SB 242: DOA; Agricultural Land; Foreign Entities; Lease Limitations; Appropriations

A BILL FOR AN ACT

RELATING TO FOREIGN OWNERSHIP OF AGRICULTURAL LAND.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that the State's agricultural land is a vital resource that must be preserved for the benefit of local farmers, communities, and food security.  In 2022, the State had the second-highest percentage of foreign‑held agricultural land in the United States, with 12.8 per cent of its agricultural land under foreign ownership.  Such a high level of foreign ownership raises concerns about land access for local farmers and the economic resilience of the State's food systems.

     The legislature further finds that the 2023 Consolidated Appropriations Act directs the United States Department of Agriculture to report to Congress on foreign investments in agricultural land in the United States, including the impact foreign ownership has on family farms, rural communities, and the domestic food supply.  This federal directive underscores the need for states like Hawaiʻi to examine and address the implications of foreign-held agricultural land.

     The purpose of this Act is to ensure that the State's agricultural lands remain available and accessible to local farmers and agricultural enterprises by limiting foreign ownership of agricultural land and establishing transparency requirements.

     SECTION 2.  The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

limitations on the PURCHASE OF agricultural lands BY FOREIGN entities

     §   -1  Definitions.  As used in this chapter:

     "Agricultural land" means any real property within the agricultural district established pursuant to section 205-2(d).

     "Foreign entity" means a corporation, business association, partnership, trust, society, or any other entity or group that is not incorporated or organized to do business in the United States, including foreign governments and any agency or subdivision of foreign governments.

     "Real property" means lands, structures, and any interest therein, and natural resources, including water, minerals, and all things connected with land, including lands under water and riparian rights, space rights, air rights, and any and all other things and rights usually included with the term.

     §   -2  Restrictions on foreign ownership of agricultural lands.  (a)  Except as provided in this chapter, no foreign entity shall own, lease, or hold a controlling interest in more than      acres of agricultural land within the State.

     (b)  No agricultural land within the State shall be sold, transferred, or leased for a period exceeding five years to a foreign entity.

     (c)  This section shall not apply to:

     (1)  Inheritance or transfer to family members as part of an estate;

     (2)  Land used for non-agricultural purposes, with approval from the department of agriculture;

     (3)  Leaseholds of five years or less for non-controlling interests in agricultural land; or

     (4)  Agricultural lands owned, leased, or in which a controlling interest is held by a foreign entity before July 1, 2025.

     §   -3  Disclosure and transparency requirements.  (a)  All foreign entities with ownership or leasehold interest in agricultural land within the State shall file an annual report to the department of agricultural detailing:

     (1)  Total acreage and location of land owned or leased;

     (2)  Types of agricultural production or land use; and

     (3)  Any material changes in ownership or leasehold status.

     (b)  The department of agriculture shall maintain an online public registry of foreign-owned agricultural lands, including land ownership, acreage, and type of use, within the State.

     §   -4  Enforcement and penalties.  (a)  Any foreign entity in violation of this chapter shall be subject to a fine in an amount not exceeding $           per acre owned, leased, or held in excess of the allowable acreage pursuant to section    -2(a).

     (b)  Any foreign entity failing to comply with reporting requirements under section    -3 shall be subject to a fine of $           for each day the report is overdue or incomplete.

     (c)  Any land transaction made in violation of this chapter shall be deemed void, and:

     (1)  Ownership or lease of the land subject to the transaction and any funds used in the land transaction shall revert to the transferor; and

     (2)  Any consideration exchanged as part of a transaction in violation of this chapter shall revert to the respective parties."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the department of agriculture to maintain a public registry of foreign-owned agricultural lands.

     The sums appropriated shall be expended by the department of agriculture for the purposes of this Act.

     SECTION 4.  This Act shall not be applied so as to impair any contract existing as of the effective date of this Act in a manner violative of either the Constitution of the State of Hawaii or Article I, Section 10, of the United States Constitution.

     SECTION 5.  This Act shall take effect on July 1, 2050.

Report Title:

DOA; Agricultural Land; Foreign Entities; Lease Limitations; Appropriations

Description:

Prohibits foreign entities from owning, leasing, or holding a controlling interest in more than an unspecified number of acres of agricultural land.  Limits the lease term for agricultural land by foreign entities.  Requires foreign entities that own or lease interest in agricultural lands to file an annual report with the Department of Agriculture.  Appropriates funds.  Effective 7/1/2050.  (SD2)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

RELATING TO FOREIGN OWNERSHIP OF AGRICULTURAL LAND.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that Hawaii's agricultural land is a vital resource that must be preserved for the benefit of local farmers, communities, and food security.  In 2022, Hawaii had the second-highest percentage of foreign‑held agricultural land in the United States, with 12.8 per cent of its agricultural land under foreign ownership.  Such a high level of foreign ownership raises concerns about land access for local farmers and the economic resilience of Hawaii's food systems.

     The legislature further finds that the 2023 Consolidated Appropriations Act directs the United States Department of Agriculture to report to Congress on foreign investments in agricultural land in the United States, including the impact foreign ownership has on family farms, rural communities, and the domestic food supply.  This federal directive underscores the need for states like Hawaii to examine and address the implications of foreign-held agricultural land.

     The purpose of this Act is to ensure that Hawaii's agricultural lands remain available and accessible to local farmers and agricultural enterprises by limiting foreign ownership of agricultural land and establishing transparency requirements.

     SECTION 2.  The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

limitations on the PURCHASE OF agricultural lands BY FOREIGN entities

     §   -1  Definitions.  As used in this chapter:

     "Agricultural land" means any real property within the agricultural district established pursuant to section 205-2(d).

     "Foreign entity" means a corporation, business association, partnership, trust, society, or any other entity or group that is not incorporated or organized to do business in the United States, including foreign governments and any agency or subdivision of foreign governments.

     "Real property" means lands, structures, and any interest therein, and natural resources, including water, minerals, and all things connected with land, including lands under water and riparian rights, space rights, air rights, and any and all other things and rights usually included with the term.

     §   -2  Restrictions on foreign ownership of agricultural lands.  (a)  Except as provided in this chapter, no foreign entity shall own, lease, or hold a controlling interest in more than      acres of agricultural land within the State.

     (b)  No agricultural land within the State shall be sold, transferred, or leased for a period exceeding five years to a foreign entity.

     (c)  This section shall not apply to:

     (1)  Inheritance or transfer to family members as part of an estate;

     (2)  Land used for non-agricultural purposes, with approval from the department of agriculture;

     (3)  Leaseholds of five years or less for non-controlling interests in agricultural land; or

     (4)  Agricultural lands owned, leased, or in which a controlling interest is held by a foreign entity before July 1, 2025.

     §   -3  Disclosure and transparency requirements.  (a)  All foreign entities with ownership or leasehold interest in agricultural land within the State shall file an annual report to the department of agricultural detailing:

     (1)  Total acreage and location of land owned or leased;

     (2)  Types of agricultural production or land use; and

     (3)  Any material changes in ownership or leasehold status.

     (b)  The department of agriculture shall maintain an online public registry of foreign-owned agricultural lands, including land ownership, acreage, and type of use, within the State.

     §   -4  Enforcement and penalties.  (a)  Any foreign entity in violation of this chapter shall be subject to a fine in an amount not exceeding $           per acre owned, leased, or held in excess of the allowable acreage pursuant to section    -2(a).

     (b)  Any foreign entity failing to comply with reporting requirements under section    -3 shall be subject to a fine of $           for each day the report is overdue or incomplete.

     (c)  Any land transaction made in violation of this chapter shall be deemed void, and ownership or lease of the land subject to the transaction and any funds used in the land transaction shall revert to the transferor."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the department of agriculture to maintain a public registry of foreign-owned agricultural lands.

     The sums appropriated shall be expended by the department of agriculture for the purposes of this Act.

     SECTION 4.  This Act shall take effect on July 1, 2050.

Report Title:

DOA; Agricultural Land; Foreign Entities; Lease Limitations; Appropriations

Description:

Prohibits foreign entities from owning, leasing, or holding a controlling interest in more than an unspecified number of acres of agricultural land.  Limits the lease term for agricultural land by foreign entities.  Requires foreign entities that own or lease interest in agricultural lands to file an annual report with the Department of Agriculture.  Appropriates funds.  Effective 7/1/2050.  (SD1)

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

A BILL FOR AN ACT

relating to foreign ownership of agricultural land.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

     SECTION 1.  The legislature finds that Hawaii's agricultural land is a vital resource that must be preserved for the benefit of local farmers, communities, and food security.  In 2022, Hawaii had the second-highest percentage of foreign‑held agricultural land in the United States, with 12.8 per cent of its agricultural land under foreign ownership.  Such a high level of foreign ownership raises concerns about land access for local farmers and the economic resilience of Hawaii's food systems.

     The legislature further finds that the 2023 Consolidated Appropriations Act directs the United States Department of Agriculture to report to Congress on "foreign investments in agricultural land in the United States, including the impact foreign ownership has on family farms, rural communities, and the domestic food supply."  This federal directive underscores the need for states like Hawaii to examine and address the implications of foreign-held agricultural land.

     The purpose of this Act is to ensure that Hawaii's agricultural land remains available and accessible to local farmers and agricultural enterprises by limiting foreign ownership of agricultural land and establishing transparency requirements.

     SECTION 2.  The Hawaii Revised Statutes is amended by adding a new chapter to be appropriately designated and to read as follows:

"Chapter

limitations on the PURCHASE OF agricultural lands BY FOREIGN entities

     §   -1  Definitions.  As used in this chapter, unless the context otherwise requires:

     "Agricultural land" means any real property within the agricultural district established pursuant to section 205-2(d).

     "Foreign entity" means a corporation, business association, partnership, trust, society, or any other entity or group that is not incorporated or organized to do business in the United States, including foreign governments and any agency or subdivision of foreign governments.

     "Real property" means lands, structures, and interest therein and natural resources, including water, minerals, and all things connected with land, including lands under water and riparian rights, space rights, air rights, and any and all other things and rights usually included with the term.

     §   -2  Restrictions on foreign ownership of agricultural lands.  (a)  Except as provided in this chapter, no foreign entity shall own, lease, or hold a controlling interest in more than      acres of agricultural land within the State.

     (b)  No agricultural land within the State shall be sold, transferred, or leased for a period exceeding five years to a foreign entity.

     (c)  This section shall not apply to:

     (1)  Inheritance or transfer to family members as part of an estate;

     (2)  Land used for non-agricultural purposes, with approval from the department of agriculture;

     (3)  Leaseholds of five years or less for non-controlling interests in agricultural land; or

     (4)  Agricultural lands owned, leased, or in which a controlling interest is held by a foreign entity before July 1, 2025.

     §   -3  Disclosure and transparency requirements.  (a)  All foreign entities with ownership or leasehold interest in agricultural land within the State shall file an annual report to the department of agricultural detailing:

     (1)  Total acreage and location of land owned or leased;

     (2)  Types of agricultural production or land use; and

     (3)  Any material changes in ownership or leasehold status.

     (b)  The department of agriculture shall maintain an online public registry of foreign-owned agricultural lands, including land ownership, acreage, and type of use, within the State.

     §   -4  Enforcement and penalties.  (a)  Any foreign entity in violation of this chapter shall be subject to a fine not exceeding $           per acre owned in excess of the allowable acreage pursuant to section    -2(a).

     (b)  Foreign entities failing to comply with reporting requirements under section    -3 shall be subject to a fine of $           for each day the report is overdue or incomplete.

     (c)  Any land transaction made in violation of this chapter shall be deemed void, and ownership of the land subject to the transaction and any funds used in the land transaction shall revert to the transferor or department of the attorney general, as applicable."

     SECTION 3.  There is appropriated out of the general revenues of the State of Hawaii the sum of $           or so much thereof as may be necessary for fiscal year 2025-2026 and the same sum or so much thereof as may be necessary for fiscal year 2026-2027 for the department of agriculture to maintain a public registry of foreign-owned agricultural lands.

     The sums appropriated shall be expended by the department of agriculture for the purposes of this Act.

     SECTION 4.  This Act shall take effect on July 1, 2025.

Report Title:

Agricultural Land; Foreign Entities; Lease Limitations; Appropriation

Description:

Prohibits foreign entities from owning, leasing, or holding a controlling interest in more than an unspecified number of acres of agricultural land.  Limits the lease term for agricultural land by foreign entities.  Requires foreign entities that own or lease interest in agricultural lands to file an annual report with the Department of Agriculture.  Appropriates funds.

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.

STAND. COM. REP. NO. 1054

Honolulu, Hawaii

RE:    S.B. No. 242

       S.D. 2

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committees on Judiciary and Ways and Means, to which was referred S.B. No. 242, S.D. 1, entitled:

"A BILL FOR AN ACT RELATING TO FOREIGN OWNERSHIP OF AGRICULTURAL LAND,"

beg leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Prohibit foreign entities from owning, leasing, or holding a controlling interest in more than an unspecified number of acres of agricultural land;

     (2)  Limit the lease term for agricultural land by foreign entities;

     (3)  Require foreign entities that own or lease interest in agricultural lands to file an annual report with the Department of Agriculture; and

     (4)  Appropriate funds.

     Your Committees received testimony in support of this measure from Lāhainā Strong, Wailua Nui Kalo Farm, Hawaiian Islands Republican Women, Aloha Freedom Coalition, and numerous individuals.

     Your Committees received testimony in opposition to this measure from the Hawaii Crop Improvement Association, Hawaiʻi Farm Bureau, Biotechnology Innovation Organization, Land Use Research Foundation of Hawaii, Hawaii Food Industry Association, and seven individuals.

     Your Committees received comments on this measure from the Department of the Attorney General, Department of Agriculture, and Chamber of Commerce Hawaii.

     Your Committees find that the State's agricultural land is a vital resource that must be preserved for the benefit of local farmers and communities.  Your Committees further find that in 2022, the State had the second-highest percentage of foreign-held agricultural land in the United States, with 12.8 percent of its agricultural land under foreign ownership.  Your Committees believe that this high level of foreign ownership raises concerns about land access for local farmers and the economic resilience of the State's food systems.  This measure will ensure that the State's agricultural land remains available and accessible to local farmers and agricultural enterprises.

     Your Committees have amended this measure by:

     (1)  Specifying that any consideration exchanged as part of a transaction in violation of the limitations on the purchase of agricultural lands by foreign entities established by this measure is required to revert to the respective parties;

     (2)  Inserting a non-impairment clause to clarify that this measure shall not be applied in a manner that impairs any existing contract in violation of the Hawaii State Constitution or United States Constitution; and

     (3)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     As affirmed by the records of votes of the members of your Committees on Judiciary and Ways and Means that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 242, S.D. 1, as amended herein, and recommend that it pass Third Reading in the form attached hereto as S.B. No. 242, S.D. 2.

Respectfully submitted on behalf of the members of the Committees on Judiciary and Ways and Means,

STAND. COM. REP. NO. 527

Honolulu, Hawaii

RE:    S.B. No. 242

       S.D. 1

Honorable Ronald D. Kouchi

President of the Senate

Thirty-Third State Legislature

Regular Session of 2025

State of Hawaii

Sir:

     Your Committees on Agriculture and Environment and Transportation and Culture and the Arts, to which was referred S.B. No. 242 entitled:

"A BILL FOR AN ACT RELATING TO FOREIGN OWNERSHIP OF AGRICULTURAL LAND,"

beg leave to report as follows:

     The purpose and intent of this measure is to:

     (1)  Prohibit foreign entities from owning, leasing, or holding a controlling interest in more than an unspecified number of acres of agricultural land;

     (2)  Limit the lease term for agricultural land by foreign entities; and

     (3)  Require foreign entities that own or lease interest in agricultural lands to file an annual report with the Department of Agriculture.

     Your Committees received testimony in support of this measure from the Office of the Mayor of the County of Maui; Hawaiʻi Farmers Union United; Hawaii Cattlemen's Council, Inc.; Hawaiʻi Alliance for Progressive Action; Animal Rights Hawaiʻi; Malama Kauaʻi; and numerous individuals.

     Your Committees received testimony in opposition to this measure from the Hawaiʻi Farm Bureau, Biotechnology Innovation, Organization, Hawaiʻi Association of REALTORS, Hawaii Crop Improvement Association, and five individuals. 

     Your Committees received comments on this measure from the Department of the Attorney General and Hawaii Food Industry Association.

     Your Committees recognize that, in 2022, the State had the second-highest percentage of foreign‑held agricultural land in the United States.  The 2023 Consolidated Appropriations Act, which directs the United States Department of Agriculture to report to Congress on foreign investments in agricultural land, underscores the need for states like Hawaii to examine and address the implications of foreign-held agricultural land.  This measure reaffirms the State's policy that access to agricultural land must be preserved for the benefit of local farmers, communities, and food security. 

     Your Committees further recognize that twenty-four other states have adopted and implemented various restrictions on the foreign ownership of agricultural lands.  Accordingly, this measure aligns with a category of policies of those states, such as a limit on the foreign ownership of agricultural lands based on the acreage of the land and the term of the lease.

     Your Committees have amended this measure by:

     (1)  Deleting language that would have required the ownership of any land that was transferred to a foreign entity after July 1, 2025, and any funds used in that transaction, in violation of the measure to revert to the Department of the Attorney General;

     (2)  Inserting an effective date of July 1, 2050, to encourage further discussion; and

     (3)  Making technical, nonsubstantive amendments for the purposes of clarity and consistency.

     Your Committees have heard concerns from numerous testifiers about the potential unintended consequences of this measure, particularly those regarding investment, land availability, and the viability of Hawaii's agricultural industry.  Your Committees find that these issues merit further consideration and examination by your Committees on Judiciary and Ways and Means, should it choose to deliberate on this measure.

     As affirmed by the records of votes of the members of your Committees on Agriculture and Environment and Transportation and Culture and the Arts that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 242, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 242, S.D. 1, and be referred to your Committees on Judiciary and Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Agriculture and Environment and Transportation and Culture and the Arts,