The amendment removes the exemption for agricultural land acquired by devise or inheritance from the 160-acre ownership limit for foreign entities, thereby **strengthening** the restriction on foreign agricultural land ownership by closing a loophole that previously allowed foreign persons to own unlimited acreage through inheritance. The amendment also updates the reference to federal law from January 1, 2024 to January 1, 2026 in the reporting requirements section.
26.445.16 26.445.17 101st Legislative Session 40 2026 South Dakota Legislature Senate Bill 40 Introduced by: The Chair of the Committee on Agriculture and Natural Resources at the request of the Department of Agriculture and Natural Resources Underscores indicate new language. Overstrikes indicate deleted language. ENROLLED AN ACT ENTITLED An Act to revise the compliance requirements for limitations on foreign ownership 1 of agricultural land. 2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 3 Section 1. That § 43-2A-2 be AMENDED: 4 43-2A-2. The following provisions apply to the ownership or leasing of agricultural 5 land in this state: 6 (1) A prohibited entity may not own agricultural land in this state; 7 (2) A prohibited entity may not lease or hold an easement on agricultural land in this 8 state, unless: 9 (a) The lease is exclusively for agricultural research purposes and encumbers 10 no more than three hundred and twenty acres; or 11 (b) The lease is exclusively for contract feeding of livestock, at an animal 12 feeding operation, by a family farm unit, a family farm corporation, or an 13 authorized farm corporation; 14 (3) Excluding a prohibited entity, a foreign entity, foreign government, or foreign 15 person may not own more than one hundred and sixty acres of agricultural land in 16 this state, provided this limitation does not include: 17 (a) Agricultural land acquired by devise or inheritance; or 18 (b) Agricultural include agricultural land held as security for indebtedness; and 19 (4) Excluding a prohibited entity, there is no restriction on easements or the number 20 of acres of agricultural land that a foreign entity, foreign government, or foreign 21 person may lease. 22 This section does not apply to a foreign entity, foreign government, or foreign 23 person whose right to hold land is secured by treaty. 24 Section 2. That § 43-2A-6 be AMENDED: 25 26.445.16 26.445.17 2 40 Underscores indicate new language. Overstrikes indicate deleted language. SB40 ENROLLED 43-2A-6. Any agricultural land owned in violation of this chapter is forfeited to the 1 state. Any agricultural land lease, or easement, held by a prohibited entity in violation of 2 this chapter, is terminated. 3 Any agriculture land acquired by devise or descent, wherein a minority owner is in 4 violation of this chapter, is subject to forfeiture of the violating minority owner’s interest 5 share, plus an additional civil penalty in an amount equal to the fair market value of the 6 violating minority owner's interest share. 7 The attorney general shall enforce the forfeiture or the termination of a lease or 8 easement. A forfeiture or a termination of a lease or easement may not be adjudged 9 unless the action to enforce is brought within three years after evidence of a violation of 10 this chapter is referred to the attorney general, as provided for in § 43-2A-6.1. No title to 11 land is invalid or liable to forfeiture by reason of the alienage of any former owner or 12 interested person. 13 Any fractional interest in any land forfeited to the state must first be made available 14 to the other equitable owners of the land at fair market value. The attorney general may 15 determine fair market value under this section by an appraisal or a value of two times the 16 assessed taxable valuation of the land. 17 Section 3. That § 43-2A-7.1 be AMENDED: 18 43-2A-7.1. Any person required to submit a report to the United States 19 Department of Agriculture in accordance with the Agricultural Foreign Investment 20 Disclosure Act of 1978, 7 U.S.C. § 3501 et seq. (January 1, 2024) §§ 3501 to 3508 21 inclusive (January 1, 2026), shall file a copy of the required report with the secretary of 22 the Department of Agriculture and Natural Resources, within the time period required for 23 submission under 7 U.S.C. § 3501. 24 If the person fails to report as required under this section, the attorney general 25 may impose a civil penalty, not to exceed ten percent of the fair market value of the 26 agricultural land interest held on the date the penalty was assessed. The attorney general 27 shall forward any civil penalty collected under this section to the state treasurer, for 28 deposit in the general fund. 29 The attorney general may bring an action to collect the civil penalty in the Sixth 30 Judicial Circuit Court in Pierre or in the circuit court of any county of this state in which 31 any portion of the relevant agricultural land is located. 32 26.445.17 3 40 SB40 ENROLLED An Act to revise the compliance requirements for limitations on foreign ownership of agricultural land. I certify that the attached Act originated in the: Senate as Bill No. 40 Secretary of the Senate President of the Senate Attest: Secretary of the Senate Speaker of the House Attest: Chief Clerk of the House Senate Bill No. 40 File No. ____ Chapter No. ______ Received at this Executive Office this _____ day of _____________, 2026 at ____________M. By for the Governor The attached Act is hereby approved this ________ day of ______________, A.D., 2026 Governor STATE OF SOUTH DAKOTA, ss. Office of the Secretary of State Filed ____________, 2026 at _________ o'clock __M. Secretary of State By Asst. Secretary of State