Should NH ban Chinese companies from buying land in the state?

From the proposed TikTok ban to the infamous "Chinese spy balloon" that drifted across the United States last year, many American lawmakers have called for new laws defending against the threat of Chinese espionage. While much of this conversation has taken place at the federal level, Granite State legislators are considering a broad bill to prevent Chinese companies from buying land near U.S. military installations, farmland, critical infrastructure, and even restaurants and banks. The bill sailed through the Senate, but now state representatives have raised some red flags.

Restricting land purchases near sensitive areas

SB 366 would prohibit any company based in China or linked to the Chinese government from owning, leasing, or controlling property within 10 miles of military installations or "critical infrastructure." The bill’s definition of "critical infrastructure" offers insight into its intent:

"Critical infrastructure" means systems and assets, whether physical or virtual, so vital to the United States or the state of New Hampshire that the incapacity or destruction of such systems and assets would have a debilitating impact on security, national economic security, national public health or safety, or any combination of those matters.

The examples of "critical infrastructure" given in the bill text are broad; it includes facilities related to energy, water, healthcare, transportation, and communications systems. The bill also includes less-predictable examples, like restaurants, banks, and national monuments.

State lawmakers take national security into their own hands

SB 366 is just one of many state-level bills across the country aimed at restricting domestic land purchases by Chinese-owned companies. In fact, more than two thirds of states have enacted or are considering such laws. The largely Republican-led effort posits that land purchases "are not being adequately controlled by the federal government, so states are acting on their own," as Indiana Republican state Rep. Kendell Culp put it. His bill, introduced in the Indiana state Senate, lists several foreign countries in its land purchase ban, including China, North Korea, and Iran, among others.

While the U.S. Department of Agriculture’s 2021 statistics showed that just 1% of the 3.4 million acres of U.S. farmland in foreign ownership was Chinese-owned, proponents of such legislation point to recent acquisitions of farmland near military bases in North Dakota and Michigan by Chinese companies.

The Biden administration has taken note of the concerns; in May, the federal Committee on Foreign Investment in the United States adopted President Biden’s proposal to review land sales made to foreign investors within 100 miles of eight high-priority U.S. military installations.

Broad language could carry unintended consequences

At the bill’s most recent public hearing on May 1, legislators teased out significant possible consequences of passing the bill. Since the bill concerns property within 10 miles of not only military bases but also restaurants, banks, and other commonplace establishments, it would effectively ban Chinese investment anywhere in the state, not just near military bases. Similar legislation enacted in Florida, which is now being challenged in federal court, has caused confusion over who can and can’t purchase property in the state.

Robert Johnson, Policy Director for the New Hampshire Farm Bureau Federation, also urged caution when he spoke in opposition to the bill. He pointed out that there are legitimate agricultural research companies and high value log storage operations owned by Chinese companies that bring significant revenue to the industry. While he acknowledged importance protecting military installations from potential espionage, he suggested the bill should be held for further study.

Upcoming vote in the House

Though SB 366 passed the Senate with a unanimous vote, the House Commerce and Consumer Affairs committee agreed the bill was too broad in its current form and would need significant changes. It was sent to a work session, but legislators there decided to recommend killing the bill rather than trying to salvage it. Now the bill will go before the full House for a vote on May 23. If you have an opinion on this bill, find out who represents you and let them know where you stand by visiting the Elected Officials page on our website.