Who will own the farm?

Just a few short months ago the voters of North Dakota overwhelmingly defeated a proposed amendment to the state’s constitution which would have set aside funds from the oil boom for conservation projects. One of the most widely used talking points against the amendment was that nonprofit environmental groups would use the funds to buy up farms and drive the price of land out of the reach of existing and beginning farmers. Speaking out against the proposed amendment, North Dakota Farmers Union President Mark Watne said, “One of the most alarming aspects of this measure is that the massive conservation funding it would provide could be used to buy farm land. It would drive up land prices and make it more difficult for agricultural producers to compete, especially new farmers and ranchers.”

Apparently, the specter of evil, out-of-state environmental and conservation organizations buying up all the land in the state touched a nerve among voters. The amendment was soundly defeated.

Now the legislature and the governor have opened the door to a new group of out-of-state buyers into the farmland market place. Under the guise of helping the dwindling number of hog farmers and dairies in the state, the North Dakota legislature has created a new exemption in our anti-corporate farming law. Supporters of the new section of the law claim it has adequate restrictions and is narrow enough to protect the integrity of the ban on corporations from owning farmland in the state. Sponsors of the bill, Senators Terry Wanzek and Joe Miller, point to the need for young farmers to have access to the capital that corporate investors can bring as well as all the feed and other supplies these large operations will buy. Why only hog and dairy farms? There are other struggling sectors in the farming community. Why not allow exemptions for sheep producers, goat, llama, and emu ranches? All of these kinds of livestock operations have seen declining numbers in recent years as well. One doesn’t have to do much research to know that huge corporate operations often do not buy supplies locally unless they are the cheapest available. Nor do they often hire local workers, but use immigrant labor instead. How will this help beginning farmers?

North Dakota Farmers Union, true to it’s policy statements, is launching a referral petition to undo the most recent corporate exemptions.NDFU has a long history of fighting for the restrictions on corporate farming in the state since the laws passage by initiated measure in 1932. Since then there have been frequent attempts to poke holes in the law. In 1981 an exemption was granted for family owned and controlled corporations actively engaged in farming.

Agriculture Commissioner, Doug Goehring, has voiced his opposition to the referral attempt. At a recent press conference, Goehring said if the North Dakota Legislature’s recent action to loosen the law comes before voters, a lawsuit is likely by supporters of the exemptions, and the entire ban could be declared unconstitutional.  Mr. Goehring claims to support the anti-corporate farming law, except in the case of hog farms and dairies.

His logic seems flawed. In 2009 North Dakota’s law was found constitutional by District Judge James Bekken in a case between the state and Crosslands, LLC which had bought up several parcels of land around the state. Crosslands argued that the state’s ban on their owning farmland violated the US Constitution’s protections of interstate commerce and was therefore unconstitutional. Judge Bekken stated in his decision, “The court agrees with the state’s analysis that North Dakota’s prohibition on corporate land ownership is essentially all-encompassing, not selective, and not discriminatory,” Could the law now be considered selective and discriminatory and therefore unconstitutional? Have our state’s lawmakers opened the hole that allows the entire law to unravel? That outcome seems more likely than any possible lawsuit resulting from repeal of the new section of the law.

Publications as diverse as “Wall Street Journal,” “Business Week,” and the Oakland Institute’s “Down on the Farm” are pointing to a growing interest in farmland as an investment. According to the Oakland Institute, “…this is the beginning, not the end, of a land rush that could literally change who owns the country and our food and agricultural systems. Not only is there space in the market for institutional investors to expand, but there are also major financial incentives for them to do so. Like gold, it can be bought to preserve the value of money during times when profitable investments are scarce; unlike gold, it has the added benefit of generating profits through rental payments and crop sales.” Hedge funds, retirement funds and investment groups see land as a secure place to park their money after the crash of 2008. Predictions are that with the retirement of aging farmers in the next few years, as much as half of all farmland in the US will change hands. This flood of land available to buy and projected food shortages resulting from climate change make owning farmland an attractive investment for corporate dollars.

Is this the kind of agriculture we want to see in this state? Do you want a hog barn on the section next to you? There are no limits in the law on the maximum number of animals that can be housed on 640 acres, only a minimum. Do you want your children to follow their dreams to be farmers by hiring on as a worker or manager in corporately owned farm? Do you want to compete with Smithfield Foods, Inc. (part of a Chinese owned corporation which recorded revenues of $4.1 billion in 2014), the Hartford Agriculture Investment Division, or Goldman Sachs to buy land?

Who really will benefit from these changes in our anti-corporate farming law which was passed by the people of the state 83 years ago to protect struggling farmers from having to compete with banks and corporations for land? Once the law is gone, it will never be reenacted.

This legislation needs to be referred.

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One thought on “Who will own the farm?

  1. Marcy Svenningsen

    Well said, Janet, as always! I can’t wait to get my hands on the petition – I know we will not have any problem getting the signatures required to refer this law to a vote of the people. Unfortunately we cannot vote on it until June of next year but in the same vein, the law cannot be enacted until after the vote. Thanks again for an excellent article!

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