1 SB14
2 215062-1
3 By Senator Melson
4 RFD: Agriculture, Conservation and Forestry
5 First Read: 11-JAN-22
6 PFD: 12/07/2021
Page 0 1 215062-1:n:10/14/2021:SLU/ma LSA2021-1989
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8 SYNOPSIS: Existing law provides that an alien, whether
9 resident or nonresident, may own, hold, or dispose
10 of real property with the same rights as a native
11 citizen.
12 This bill would restrict ownership of
13 agricultural land to United States citizens and
14 resident aliens only, subject to certain limited
15 exceptions.
16 This bill would further provide a civil
17 penalty for violation of certain registration
18 requirements.
19
20 A BILL
21 TO BE ENTITLED
22 AN ACT
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24 Relating to ownership of agricultural land; to
25 restrict ownership of agricultural land to United States
26 citizens and resident aliens only, subject to certain limited
Page 1 1 exceptions; and to provide a civil penalty for violation of
2 certain registration requirements.
3 BE IT ENACTED BY THE LEGISLATURE OF ALABAMA:
4 Section 1. As used in this act, the following terms
5 have the following meanings:
6 (1) AGRICULTURAL LAND. Land suitable for use in
7 farming.
8 (2) FARMING. The cultivation of land for the
9 production of agricultural crops, the raising of poultry, the
10 production of eggs, the production of milk, the production of
11 fruit or other horticultural crops, and grazing or production
12 of livestock. The term includes the production of timber,
13 forest products, nursery products, or sod. The term does not
14 include a contract where a processor or distributor of farm
15 products or supplies provides spraying, harvesting, or other
16 farm services.
17 (3) FOREIGN BUSINESS. A corporation incorporated
18 under the laws of a foreign country, or a business entity
19 whether or not incorporated, in which a majority interest is
20 owned directly or indirectly by nonresident aliens. Legal
21 entities, including, but not limited to, trusts, holding
22 companies, multiple corporations, and other business
23 arrangements, do not affect the determination of ownership or
24 control of a foreign business.
25 (4) FOREIGN GOVERNMENT. A government other than the
26 government of the United States, its states, territories, or
27 possessions.
Page 2 1 (5) NONRESIDENT ALIEN. An individual who is not any
2 of the following:
3 a. A citizen of the United States.
4 b. An individual lawfully admitted into the United
5 States for permanent residence by the United States
6 Immigration and Naturalization Service. An individual is
7 lawfully admitted for permanent residence, regardless of
8 whether the individual's lawful permanent resident status is
9 conditional.
10 Section 2. An alien, resident or nonresident, may
11 take and hold property, real and personal, in this state,
12 either by purchase, descent, or devise, and may dispose of and
13 transmit the same by sale, descent, or devise as a native
14 citizen.
15 Section 3. (a) Notwithstanding Section 35-5-1, Code
16 of Alabama 1975, a nonresident alien, foreign business, or
17 foreign government, or an agent, trustee, or fiduciary
18 thereof, may not purchase or otherwise acquire agricultural
19 land in this state. A nonresident alien, foreign business, or
20 foreign government, or an agent, trustee, or fiduciary
21 thereof, that owns or holds agricultural land in this state on
22 the effective date of this act, may continue to own or hold
23 the land, but shall not purchase or otherwise acquire
24 additional agricultural land in this state.
25 (b) The restriction set forth in subsection (a) does
26 not apply to the following:
27 (1) Agricultural land acquired by devise or descent.
Page 3 1 (2) A bona fide encumbrance on agricultural land
2 taken for purposes of security.
3 (3) Agricultural land acquired by a process of law
4 in the collection of debts, by a deed in lieu of foreclosure,
5 pursuant to a forfeiture of a contract for deed, or by any
6 procedure for the enforcement of a lien or claim on the land,
7 whether created by mortgage or otherwise. However,
8 agricultural land so acquired shall be sold or otherwise
9 disposed of within two years after title is transferred.
10 Pending the sale or disposition, the land shall not be used
11 for any purpose other than farming, and the land shall not be
12 used for farming except under lease to an individual, trust,
13 corporation, partnership, or other business entity.
14 (c) A person who acquires agricultural land in
15 violation of this act, remains in violation for as long as the
16 person holds an interest in the land.
17 Section 4. A nonresident alien, foreign business, or
18 foreign government, or an agent, trustee, or fiduciary
19 thereof, that acquires agricultural land or an interest in
20 agricultural land, by devise or descent after the effective
21 date of this act, shall divest itself of all right, title, and
22 interest in the land within two years following the date of
23 acquiring the land or interest.
24 Section 5. A person or business that purchases or
25 otherwise acquires agricultural land in this state, except by
26 devise or descent, following the date of this act, and whose
27 status changes so that it becomes a foreign business or
Page 4 1 nonresident alien subject to this act, shall divest itself of
2 all right, title, and interest in the land within two years
3 following the date that its status changed.
4 Section 6. A nonresident alien, foreign business, or
5 foreign government, or an agent, trustee, or fiduciary
6 thereof, that owns an interest in agricultural land shall
7 register with the Secretary of State. The registration shall
8 be made not later than 60 days after the effective date of
9 this act or not later than 60 days after acquiring the land or
10 the interest in land, whichever time is later. The
11 registration shall be in the form and manner prescribed by the
12 Secretary of State and shall contain the name of the owner and
13 the location and number of acres of the agricultural land by
14 municipality and county. If the owner of the agricultural land
15 or owner of the interest in agricultural land is an agent,
16 trustee, or fiduciary of a nonresident alien, foreign
17 business, or foreign government, the registration shall also
18 include the name of any principal for whom that land, or
19 interest in that land, was purchased as agent.
20 Section 7. (a) If a court of competent jurisdiction
21 finds that the land in question has been acquired in violation
22 of this act, the court shall declare the land escheated to the
23 state. When escheat is decreed by the court, the clerk of
24 court shall notify the Governor that the title to the real
25 estate is vested in the state by decree of the court.
26 (b) Any real estate, the title to which is acquired
27 by the state under this act, shall be sold in the manner
Page 5 1 provided by law for the foreclosure of a mortgage on real
2 estate for default of payment. The proceeds of the sale shall
3 be used to pay court costs, and the remaining funds, if any,
4 shall be paid to the person divested of the property, but only
5 in an amount not exceeding the actual cost paid by the person
6 for that property. Proceeds remaining after the payment of
7 court costs and the payment to the person divested of the
8 property shall become a part of the funds of the county or
9 counties in which the land is located, in proportion to the
10 part of the land in each county.
11 Section 8. A civil penalty of not more than two
12 thousand dollars ($2,000) shall be imposed for each offense
13 upon a nonresident alien, foreign business, or foreign
14 government, or an agent, trustee, or other fiduciary thereof,
15 who fails to timely file the registration as required by
16 Section 6.
17 Section 9. This act shall become effective on the
18 first day of the third month following its passage and
19 approval by the Governor, or its otherwise becoming law.
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