North Dakota livestock farms will be able to “aggregate capital the way every other business does,” Gov. Doug Burgum said, just before signing a bill to loosen restrictions on corporate farming in the state.
Burgum has lamented that the state’s producers were handcuffed by the state’s anti-corporate farming laws, with North Dakota falling far behind neighboring states in animal agriculture.
“We had the land, we have the water, we got the feed, we got the work ethic,” Burgum said. “The only thing that was missing was that we had restrictive laws that prevented farmers from having access, the ability to access capital, and aggregate capital the way every other business does in the state.”
Burgum signed House Bill 1371 on Friday, April 28, in a ceremony at the Capitol. The bill to "modernize" state law passed both houses of the Legislature easily on Monday, Aug. 24.
The bill has an emergency provision, taking effect immediately after signing.
The new law will allow livestock operations to be able to attract outside investment, much needed to help build modern but very expensive livestock facilities, but with several limitations, such as ensuring that farmers make up the majority of partners in any corporate structure.
For corporations, shareholders holding 75% or more of the shares must be actively engaged in farming or ranching; for an LLC, the percentage is 51%. Shareholders must be U.S. citizens, and no corporation or LLC may own, lease or have an interest in more than 160 acres of farmland or ranchland.
North Dakota lags behind its neighboring states in every form of livestock production. Burgum noted that the state, which once had a million dairy cows, is down to 12,000 dairy cows, fewer than some individual commercial dairies not far away in Minnesota.
There have been several failed attempts at changing North Dakota’s corporate farming law.
A bill passed in 2015 to promote dairy and swine operations was overturned in a statewide referendum, with North Dakota Farmers Union, the largest farm group in the state leading the opposition to preserve family farms.
Burgum noted that this year, Farmers Union, along with other ag groups, was at the table during negotiations.
“North Dakota is still securely and safely family farms,” Burgum said. “But now we have finally given farmers the freedom to be able to do the things that they can do in other states. It's going to allow capital investment to flow into our state.
“It's going to create opportunities for the next generation of family farms; it's going to help rural communities and schools in North Dakota thrive once again.”
Source: inforum.com
Photo Credit: GettyImages-Bobex-73
Categories: North Dakota, Business