For many new and beginning farmers, buying land to farm is a long, and challenging process, involving raising funds, acquiring land, and then setting down roots to do the difficult, but fulfilling work of working the land. For the growing number of corporations and investment firms who see farmland as an “asset class,” it’s an entirely different story. Instead of purchasing land to farm, these companies value land for its rapidly inflating price on the marketplace and for the ability to extract regular rent from farmers and subsidies from the US government.
Fran Miller, Agrarian Trust Board member and Senior Staff Attorney and Adjunct Professor at Center for Agriculture and Food Systems at Vermont Law and Graduate School, has been working to curb corporate ownership of land. Recently, Fran collaborated with National Family Farm Coalition in drafting the Farmland for Farmers Act, an exciting new piece of legislation, introduced by Senator Cory Booker in July, that aims to ban pension funds and other investment companies from owning farmland. We recently had a chance to connect with Fran, and learn more about her work on the Farmland for Farmers Act. The following interview has been edited for length and clarity.
How did you get involved in the work with NFFC on corporate land grabs, which led to the drafting of the Farmland for Farmers Act?
I met Lisa Griffith from the National Family Farm Coalition (NFFC), at one of the first conferences that I went to as a CAFS staff person. That was in the fall of 2019. She connected me to Jordan Treakle, the National Program Coordinator at NFFC. Since then, I’ve had multiple students work with me on a variety of briefs and memos to provide legal support to the policy work that NFFC the national family farm coalition has been developing to deal with corporate land grabs in the US. NFFC has a series of briefs on their website right now that come from the work that me and my students have done over the past few years.
Politically, what role do you see the Farmland for Farmers Act playing?
On the state and federal level, there has been a lot of political rhetoric about foreign investment in agricultural land. There are numerous bills that have been introduced in the states to prevent China and Iran and North Korea from owning land in the US. Much of this discourse gets very xenophobic very quickly, for example, banning citizens of the United States who are of Chinese heritage from owning land in Florida.
Part of my interest in developing this bill is to counter this narrative, and to say, wait a minute, when it comes to countering food insecurity and lack of land access in America, the issue is not the extent of foreign ownership of land. In fact, Canada owns the most farmland of any foreign country. The issue is land grabs by domestic pension funds and investment firms who are exclusively concerned with extracting profit and not caring for the land in the way that it needs to be cared for.
These land grabs prevent people who actually want to farm from farming. They prevent America from redressing past injustices by giving land to Black and Brown people. Because there’s only so much land. For me, it raises these issues and allows us to have a conversation about it.
How much land is owned by domestic versus foreign corporations?
It’s easy to have a sense of how much land is owned by foreign entities because there is a federal law on the books called AFIDA, Agricultural Foreign Investment Disclosure Act, which requires voluntary disclosure when a foreign entity purchases ag land. So it’s not ironclad because it’s voluntary, but there is a database that USDA keeps. And so you can tell how much land is owned.
In terms of land owned by domestic corporations, there is no way of knowing because no one keeps track. This is one of the things that the Farmland for Farmers Act would do; any corporate entity buying land would be required to report the transaction to the federal government.
Still, even without a clear means of tracking corporate ownership, there is a lot of evidence that pension funds and investment companies are purchasing tons of land. Academic scholars have been studying the issue. Loka Ashwood, a rural sociologist, wrote a paper on this called “What owns the land: the corporate organization of farmland investment.” Madeleine Fairbairn is another academic who worked with Jordan Treakle and Elsa Calderon to write a paper about corporate ownership of farmland in the Delta region called “Selling Out the Delta: Farmland Investment and Small Farmer Land Access in Mississippi.”
Why are corporations looking at farmland as an asset?
It’s happening more now because land has become a stable investment. If you look at the websites of investment funds that are buying up lands they promise returns that are stable, and good. After all, the price of prime agricultural land has gone up tremendously in the past twenty years. They’re not making any more of it. Additionally, as an investor, if you own the land you can apply for USDA subsidies and commodity payments.
What does farming on a piece of corporate owned land look like for farmers?
If an owner of a piece of land only cares about profit, they’re going to extract as much rental income as they can. This leaves the farmer really only focused on yield as opposed to investing in healthy soil, or mitigating against climate change, or creating habitats for birds, or any of the other things that land provides in the ecosystem. It’s more about profit than anything else, and the farmer that’s renting that land is going to have to respond in that way.
How does corporate land ownership affect prices and farmers’ ability to access land?
While it’s difficult to establish a causal relationship because of the lack of data, we know that it has contributed. Farmland prices have nearly doubled since 2005. Those higher prices make it easier for corporate investors to outbid new and beginning farmers, farmers without a lot of capital, farmers who are farming but want to expand their land base. They just don’t have that kind of money.
How do you define “corporations” in the Farmers for Farmland Act?
The purpose of the bill is to restrict multi-layered subsidiaries. This is how pension funds and investors hide who owns what. An LLC might own an LLC that owns another LLC, and there might be five members of that LLC. This ownership structure makes it really difficult to know who owns what. And so it bans those, and it bans pension funds and investment funds.
The purpose of the bill is to ban ownership of agricultural land by those who intend to use it as an investment vehicle. Because if you use land as an investment vehicle, you’re really going to extract as much profit as possible out of it. In this moment when climate change is so clearly on the horizon, and farmers need to be incentivized to do activity that will mitigate against climate change,extracting as much profit as possible is not a good idea.
Would the ban on corporate ownership of land apply to nonprofits, cooperatives, and other organizations that hold land as institutions, rather than as individuals or family farms?
There are exceptions to the ban. Nonprofits are exempted. Cooperatives are exempted. Ag land acquired for research is exempted. Ag land owned by a public institution for higher education is exempted. City owned land that is agricultural is exempted. Agricultural land that’s owned by a legal entity formed by the owners of heirs property is exempted. We attempted to include exceptions for businesses that are not extractive. We also exempted certain corporations that are owned by people who are actively engaged in farming.
Learn more about the Farmland for Farmers Act on NFFC’s website.