Limitations on ownership of agricultural or forestry land in this state by foreign persons. (FE)

1. An exploration mining lease and land used for certain mining and associated activities.

2. Certain manufacturing activities.

3. Certain mercantile activities.

4. A lease for exploration or production of oil, gas, coal, shale, and related hydrocarbons, including by-products of the production, and land used in connection with the exploration or production.

Those exceptions have been interpreted to be “extremely broad, embracing almost every conceivable business activity [other than a]ctivities relating to agriculture and forestry.” See Wis. Op. Att'y Gen. OAG 11-14, ¶5, available at https://www.doj.state.wi.us. In other words, under current law, foreign persons may acquire, own, and hold unlimited amounts of land for most nonagricultural and nonforestry purposes, but certain foreign persons may not acquire, own, or hold more than 640 acres of land for agricultural or forestry purposes.

The bill eliminates the four exceptions enumerated under current law and instead provides that the limitation on foreign ownership of land applies only to land that is classified, for property tax purposes, as agricultural, agricultural forest, or productive forest land (agricultural or forestry land).

Amount of land foreign persons may acquire The bill reduces the maximum amount of agricultural or forestry land that certain foreign persons may acquire, own, or hold from 640 acres to 50 acres (acreage limit).

Covered foreign persons Under current law, the following persons generally are subject to the acreage limit:

1. An alien not a resident of a state of the United States (nonresident alien).

2. A corporation that is not created under federal law or the laws of any state (foreign entity).

3. A corporation, limited liability company, partnership, or association having more than 20 percent of its stock, securities, or other indicia of ownership held or owned by nonresident aliens or foreign entities (foreign-owned entity).

4. A trust having more than 20 percent of the value of its assets held for the benefit of nonresident aliens or foreign entities (foreign beneficiary trust).

The bill specifies that the acreage limit also applies to a foreign government.

Divestiture period Under current law, if a covered foreign person acquires an interest in agricultural or forestry land that causes the foreign person to exceed the acreage limit, the foreign person must divest itself of that interest. Specifically, the foreign person must divest itself within four years after:

1. Acquiring the interest, if the foreign person is a nonresident alien or foreign entity and the interest is acquired by devise, inheritance, or in the good faith collection of debts by due process of law.

2. Acquiring the interest or becoming a foreign-owned entity or foreign beneficiary trust, whichever is later, if the foreign person is a foreign-owned entity or foreign beneficiary trust.

The bill reduces the divestiture period from four years to two years. The bill also specifies that the divestiture requirement described under item 1. applies to a foreign government.

Enforcement authority Current law provides that the attorney general must enforce the limitations and requirements related to the acquisition, ownership, and holding of agricultural or forestry land by foreign persons. Among other things, current law provides that interests in land acquired or held in violation of those limitations are forfeited to the state. The bill transfers enforcement authority, including enforcement of the forfeiture penalty, to DATCP.