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| 12 | 12 | | Introduced by: Representative Auch |
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| 13 | 13 | | |
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| 14 | 14 | | Underscores indicate new language. |
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| 15 | 15 | | Overstrikes indicate deleted language. |
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| 16 | 16 | | An Act to prohibit natural asset companies. 1 |
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| 17 | 17 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 2 |
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| 18 | 18 | | Section 1. That a NEW SECTION be added to a NEW CHAPTER in title 5: 3 |
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| 19 | 19 | | Terms in this chapter mean: 4 |
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| 20 | 20 | | (1) "Natural asset," arable soil, air quality, biodiversity, drainage management, 5 |
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| 21 | 21 | | extractive resources, natural disaster resilience, pollution sinks, and water quality; 6 |
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| 22 | 22 | | (2) "Natural asset company," a corporation, limited liability company, or any other 7 |
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| 23 | 23 | | entity or affiliate of an entity that: 8 |
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| 24 | 24 | | (a) Holds the rights to the ecological performance of a defined area and has the 9 |
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| 25 | 25 | | authority to manage the area for conservation, restoration, or sustainable 10 |
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| 26 | 26 | | management; 11 |
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| 27 | 27 | | (b) Has a primary purpose of actively growing, maintaining, managing, or 12 |
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| 34 | | - | (3) "State" each agency and political subdivision of this state, except the South Dakota 19 |
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| 35 | | - | Retirement System and the State Investment Council. 20 |
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| 36 | | - | Section 2. That a NEW SECTION be added to a NEW CHAPTER in title 5: 21 |
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| 37 | | - | The state may not: 22 |
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| 38 | | - | (1) Encumber, grant easements or liens to, lease, license, or sell public land or state 23 |
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| 39 | | - | resources to or in favor of a natural asset company; or 24 25.620.10 2 1107 |
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| 34 | + | (3) "State" each agency and political subdivision of this state. 19 |
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| 35 | + | Section 2. That a NEW SECTION be added to a NEW CHAPTER in title 5: 20 |
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| 36 | + | The state may not: 21 |
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| 37 | + | (1) Encumber, grant easements or liens to, lease, license, or sell public land or state 22 |
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| 38 | + | resources, including land or resources owned by the state retirement system, to or 23 |
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| 39 | + | in favor of a natural asset company; or 24 25.620.9 2 1107 |
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| 40 | 40 | | Underscores indicate new language. |
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| 41 | 41 | | Overstrikes indicate deleted language. |
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| 42 | 42 | | (2) Otherwise engage in business, whether directly or indirectly, with a natural asset 1 |
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| 43 | 43 | | company in a way that would grant the natural asset company a direct or indirect 2 |
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| 44 | 44 | | interest in, or right to, public land or state resources. 3 |
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| 45 | 45 | | Section 3. That a NEW SECTION be added to a NEW CHAPTER in title 5: 4 |
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| 46 | 46 | | The investment of any state moneys in a natural asset company is prohibited. Any 5 |
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| 47 | 47 | | money allocated to, controlled by, or managed by the state may not be invested in: 6 |
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| 48 | 48 | | (1) Securities or other interests of a natural asset company; 7 |
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| 49 | 49 | | (2) Mutual funds or other funds invested in a natural asset company; or 8 |
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| 50 | 50 | | (3) Private placements, partnerships, or other investments in a natural asset company. 9 |
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| 51 | 51 | | The state may not approve, guarantee, issue, sponsor, or otherwise engage with 10 |
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| 52 | 52 | | any bond offering involving a natural asset company or any project in which a natural 11 |
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| 53 | 53 | | asset company holds an interest or exercises control. 12 |
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| 54 | 54 | | Any person overseeing investment or bonding activities in violation of this Act shall 13 |
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| 55 | 55 | | immediately arrange for the disposition of any prohibited investment or use of moneys. 14 |
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| 56 | 56 | | Section 4. That a NEW SECTION be added to a NEW CHAPTER in title 5: 15 |
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| 57 | 57 | | A natural asset, including real property and any associated easement, 16 |
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| 58 | 58 | | encumbrance, lien, or other interest or right, may not be used for the benefit of, 17 |
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| 59 | 59 | | transferred or promised to, or created for later transfer to or use by, a natural asset 18 |
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| 60 | 60 | | company. 19 |
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| 61 | 61 | | The Governor, attorney general, any agency of this state, any member of the 20 |
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| 62 | 62 | | Legislature, any political subdivision within this state, or any private citizen who is 21 |
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| 63 | 63 | | adversely affected by a violation of this Act may file an action in the circuit court in the 22 |
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| 64 | 64 | | county in which the affected natural asset is located. 23 |
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| 65 | 65 | | If a natural asset company acquires an ownership interest in a natural asset, 24 |
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| 66 | 66 | | ownership of the natural asset must revert to the prior owner and any associated 25 |
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| 67 | 67 | | easement, encumbrance, or lien is void and unenforceable. 26 |
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| 68 | 68 | | If the court finds a violation of this Act has occurred, the court may award attorney 27 |
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| 69 | 69 | | fees and costs to the plaintiff. 28 |
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| 70 | 70 | | Section 5. That a NEW SECTION be added to a NEW CHAPTER in title 5: 29 |
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| 71 | 71 | | A natural asset company may not operate, conduct business, or acquire assets, 30 |
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| 73 | 73 | | Underscores indicate new language. |
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| 74 | 74 | | Overstrikes indicate deleted language. |
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| 75 | 75 | | organization, privately held farm, or company that contracts with government entities to 1 |
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| 76 | 76 | | actively manage ecosystem health by providing physical services. 2 |
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| 77 | 77 | | Section 6. That a NEW SECTION be added to a NEW CHAPTER in title 5: 3 |
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| 78 | 78 | | The secretary of state shall rescind authority to transact business in this state from 4 |
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| 79 | 79 | | any entity that becomes a natural asset company. 5 |
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| 80 | 80 | | The secretary of state shall revoke any certificate of authority already issued to a 6 |
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| 81 | 81 | | foreign natural asset company. 7 |
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| 82 | 82 | | The secretary of state may not: 8 |
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| 83 | 83 | | (1) Accept for filing any articles of incorporation or other organizational documents of 9 |
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| 84 | 84 | | a natural asset company; 10 |
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| 85 | 85 | | (2) Grant authority to a natural asset company to transact business in this state; 11 |
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| 86 | 86 | | (3) Accept any amendment of an existing entity's articles of incorporation or other 12 |
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| 87 | 87 | | organizational documents for the purpose of converting the existing company into 13 |
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| 88 | 88 | | a natural asset company; 14 |
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| 89 | 89 | | (4) Accept filing fees from a natural asset company; 15 |
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| 90 | 90 | | (5) Permit a natural asset company to enjoy good standing, transact business, or 16 |
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| 91 | 91 | | otherwise operate in this state; or 17 |
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| 92 | 92 | | (6) Issue a certificate of authority to a foreign natural asset company. 18 |
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| 93 | 93 | | Section 7. That a NEW SECTION be added to a NEW CHAPTER in title 5: 19 |
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| 94 | 94 | | Any contract with a natural asset company entered into on or after July 1, 2025, 20 |
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| 95 | 95 | | by the state or by any other entity in violation of the provisions of this Act is void and 21 |
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| 96 | 96 | | unenforceable. 22 |
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