Today, I submitted written testimony for the House Committee on Appropriations, Subcommittee on Agriculture, Rural Development, Food and Drug Administration, and Related Agencies. Click here to download a full PDF of the testimony.
Chairman Andy Harris, Ranking Member Sanford Bishop, and Members of the Subcommittee:
My name is Lars Erik Schönander. I am a Policy Technologist at Lincoln Network, a think tank working to bridge the gap between Silicon Valley and D.C. by applying technology and technical talent to governance and policy challenges. I write to encourage the Subcommittee to protect American farmland and critical infrastructure from malign foreign influence by directing the Department of Agriculture (USDA), and specifically the Farm Service Agency to enforce compliance with the Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA) and provide them sufficient appropriations to do so.
USDA received $25.2 billion in discretionary funding in FY2023, a $737 million increase from FY2022.[1] While the Department mainly focuses on supporting American farmers, USDA also has the responsibility to enforce federal law to track foreign agricultural investment in the United States. As Congress begins the FY2024 appropriations cycle, the Subcommittee should require USDA to reform AFIDA, following up on the reforms contained in the FY2023 Omnibus.[2]
AFIDA requires USDA to track foreign investment in American agriculture due to concerns in the 1970’s of OPEC investors buying up large amounts of American farmland, and the U.S. government not having any data on that subject. By collecting data, USDA was able to prove then that OPEC countries were not buying up large amounts of American farmland. The tracking is done by requiring foreign investors who buy, sell, or hold interest in American agricultural land to disclose these transactions to USDA.[3] Under the law, foreign investors submit an FSA-153 form no later than 90 days after a given transaction occurs and then afterward on an annual basis for each individual holding. AFIDA also requires USDA to produce an annual report on foreign agricultural investment in the U.S., and to fine investors who improperly report their foreign agricultural investments. To track the investment data and generate the annual reports, USDA stores the submitted FSA-153 forms in an internal database.[4]
Since 1978, foreign investors have bought 40 million acres of U.S. agricultural land, representing 3.1 percent of all privately owned agricultural land in America.[5] The total value of foreign investments in U.S. agricultural land has risen from $34 billion in 2010, when USDA started reporting property value in its annual reports, to $74 billion in 2021.[6]
AFIDA enforcement has historically been lax as the result of limited resourcing and basic administrative problems.[7] These problems include:
- Failure to properly track investments: USDA historically has been unable to fully track all foreign agricultural investment in the United States. In 1989, when the Government Accountability Office (GAO) audited the AFIDA program, it found that the program did not completely track all foreign agricultural investment in the United States.[8] The problem remains today.[9] Without proper tracking, it is impossible to know what else is owned by foreign investors and missing from the AFIDA database.
- Limited enforcement capabilities: According to internal USDA documentation, USDA did not assess fines related to AFIDA from 2015 to 2018 as the result of a surge in foreign agricultural investment.[10]
- Short Staffing: Until 2022, the number of staff working on AFIDA varied from only two to three people.[11] Only in 2022 did USDA hire more staff to work on AFIDA, and the majority of the hired staff is temporary.
- Reduced accuracy: Spokespeople for AFIDA have stated on record that they are unable to review filings for accuracy due to being short of staff.[12]
- Unclear spending: It is unknown how much money is spent each year on enforcing AFIDA.[13]
- Data access and quality issues: The AFIDA database, which provides the data underlying the annual reports, requires Freedom of Information Act requests to access. The database provides far more detailed data than the annual reports themselves. The annual report data is in PDF format, which is cumbersome to analyze compared to a spreadsheet.
Today, lax enforcement is most concerning regarding land purchases from Chinese investors. Through AFIDA, we know that Chinese investment in American agricultural land has risen from $80 million in 2010 to $1.8 billion in 2021.[14] In recent years, there have been at least two troubling examples of Chinese purchases of American agricultural land. In 2017, Sun Guangxin, a Chinese billionaire directly connected to the CCP, bought over 140,000 acres of land on the Texas-Mexico border right next to Laughlin Air Force Base in Texas.[15] Furthermore, until 2022, USDA did not track all the properties Sun Guangxin bought, because he did not fully report his holdings to USDA. In another case, in 2021, the Chinese agricultural company Fufeng Group attempted to buy property next to Grand Forks Air Force Base in North Dakota.[16] Both deals were condemned by members of Congress out of concern that, given both entities’ connection to the CCP connections, the CCP could use the properties to spy on military bases.[17]
The FY2023 Omnibus required USDA to update AFIDA management. Required changes include requiring USDA to produce a report on the impact of foreign investment in American farmland on American farmers, and digitizing the FSA-153 submission process.[18] In this light, continued support to the AFIDA program should be predicated on reforms based on the FY2023 Omnibus.
In the 118th Congress, Congress should provide additional resources to USDA for updating the management and enforcement of AFIDA. In FY2024 appropriations, Congress should provide USDA with sufficient resources to effectively enforce AFIDA and modernize the program by including report language that encourages the Department to do the following:
- Have the Office of the Inspector General for USDA audit USDA about unreported investments and ways that foreign investors evade reporting along with requiring the report in the FY2023 Omnibus required to be published on an annual basis up until FY 2030.
- Require USDA to update the AFIDA database when FSA-153 forms are submitted, instead of only once a year. The database and annual reports should be shared in more accessible formats, such as a spreadsheet. USDA should also provide quarterly updates on the state of the digitization of the submission process.
- Include AFIDA activities in future Congressional Budget Justifications to inform Congress and the public what resources are being dedicated to enforcing the law and monitoring foreign investments.
Without proper transparency into how foreign countries invest in American agricultural land, it is difficult to know if any given investment is for benign or malign purposes. Improving the enforcement of AFIDA would allow the American people and Congress to fully understand the extent of foreign investment in American agriculture.
[1] House Appropriations Committee, Summary of Appropriations Provisions by Subcommittee (2023), https://appropriations.house.gov/sites/democrats.appropriations.house.gov/files/FY23%20Summary%20of%20Appropriations%20Provisions.pdf.
[2] See “Agricultural Foreign Investment Disclosure Act (AFIDA),” Farm Service Agency, USDA, accessed March 27, 2023, https://www.fsa.usda.gov/programs-and-services/economic-and-policy-analysis/afida/index.
[3] 7 C.F.R. § 781.1 (1984),
https://www.ecfr.gov/current/title-7/subtitle-B/chapter-VII/subchapter-D/part-781.
[4] The database is informally called the “AFIDA Database.”
[5] “Foreign Holdings of U.S. Agricultural Land,” USDA Farm Service Agency, 2021, https://www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/EPAS/PDF/2021_afida_annual_report_through_12_31_2021.pdf.
[6] “Foreign Holdings of U.S. Agricultural Land,” USDA Farm Service Agency, 2010, https://www.fsa.usda.gov/Assets/USDA-FSA-Public/usdafiles/EPAS/PDF/2010_afida_9_21_11.pdf.; “Foreign Holdings of U.S. Agricultural Land,” USDA Farm Service Agency, 2021,
[7] See Johnathan Hettinger, “USDA Fails to Monitor Foreign Owners of Farmland,” Midwest Center for Investigative Reporting, September 25, 2017, https://investigatemidwest.org/2017/09/25/usda-has-not-enforced-act-tracking-foreign-investment-in-farmland-since-2014/.
[8] Government Accountability Office, NSIAD-90-25BR, “Foreign Investment: Federal Data Collection on Foreign
Investment in the United States” (1989), https://www.gao.gov/products/nsiad-90-25br.; Johnathan Hettinger, “USDA Fails to Monitor Foreign Owners of Farmland.”
[9]Jamie Grey, Emily Featherston, Lee Zurik, Jon Decker and Cory Johnson, “Secret Acres: Foreign-owned agricultural land inaccurately tracked by government,” Investigate TV, January 24, 2022, https://www.investigatetv.com/2022/01/24/secret-acres-foreign-owned-agricultural-land-inaccurately-tracked-by-government/.
[10] Montaño Greene, Gloria,“Agricultural Foreign Investment Disclosure Act (AFIDA) Economic and Policy Analysis Division/FPAC,” 2022, https://www.agri-pulse.com/ext/resources/2023/AFIDA-memo.pdf.
[11] Personal correspondence with USDA representatives. See “Org charts for AFIDA and associated branches by selected years 20221006,” USDA, accessed April 3, 2023,
https://docs.google.com/spreadsheets/d/1ClFidHsBqDrCMrdxeUwOczST4EsEldA8.
[12] Johnathan Hettinger, “USDA Fails to Monitor Foreign Owners of Farmland.” Until the Consolidated Appropriations Act of 2023, data was sent to USDA through paper forms. Now, USDA is required to digitize the process.
[13] Ibid.
[14] “Foreign Holdings of U.S. Agricultural Land,” USDA Farm Service Agency, 2010; “Foreign Holdings of U.S. Agricultural Land,” USDA Farm Service Agency, 2021.
[15] John Hyatt, “Why a Secretive Chinese Billionaire Bought 140,000 Acres of Land in Texas,” Forbes, August 9, 2021, https://www.forbes.com/sites/johnhyatt/2021/08/09/why-a-secretive-chinese-billionaire-bought-140000-acres-ofland-in-texas/?sh=5208712a78c3.
[16] Chris Clayton, “Chinese Corn Mill Likely Halted in North Dakota,” Progressive Farmer, February 1, 2023, https://www.dtnpf.com/agriculture/web/ag/news/business-inputs/article/2023/02/01/grand-forks-mayor-moves-halt-corn
[17] “Sens. Cruz, Cornyn, Rep. Hurd Highlight National Security Concerns With Chinese Investment In Val Verde Project,” Office of Senator Ted Cruz, July 10, 2020, https://www.cruz.senate.gov/newsroom/press-releases/sens-cruz-cornyn-rep-hurd-highlight-national-security-concerns-with-chinese-investment-in-val-verde-project; Letter from Andrew P. Hunter to Kevin Kramer, January 27, 2023, https://senatorkevincramer.app.box.com/s/l4v3ss15sru21z8ifmkwec229dxt1k9x.
[18]Congress.gov. "H.R.2617 - 117th Congress (2021-2022): Consolidated Appropriations Act, 2023." December 29, 2022. https://www.congress.gov/bill/117th-congress/house-bill/2617.
