HOUSE BILL NO. 4283

March 14, 2023, Introduced by Rep. Johnsen and referred to the Committee on Government Operations.

A bill to amend 1846 RS 66, entitled

"Of estates in dower, by the curtesy, and general provisions concerning real estate,"

by amending the title and sections 35 and 36 (MCL 554.135 and 554.136) and by adding section 36a.

the people of the state of michigan enact:

TITLE

Of estates in dower, estates by the curtesy, and general provisions concerning real estate, prohibitions on certain foreign ownership of certain real estate, and the prescription of remedies and civil sanctions.

Sec. 35. (1) Any Except as otherwise provided in section 36a, an alien may acquire and hold lands, land, or any right thereto or interest therein, in land, by purchase, devise, or descent, and he may convey, mortgage, and devise the same, and if he shall die that land or right or interest in land. If an alien dies intestate, the same shall alien's land or right or interest in land must descend to his the alien's heirs. ; and in all cases such lands shall

(2) Except as otherwise provided in section 36a, land or a right or interest in land described in subsection (1) must be held, conveyed, mortgaged, or devised, or shall must descend in like manner, and with like effect, as if such the alien were a native citizen of this state , or of the United States.

Sec. 36. The Except as otherwise provided in section 36a, the title to any lands heretofore land conveyed shall must not be questioned, nor or in any manner affected, by reason because of the alienage of any person from or through whom such that title may have been was derived.

Sec. 36a. (1) Beginning on the effective date of the amendatory act that added this section, except as otherwise provided in this section, a foreign person shall not purchase or otherwise acquire agricultural land in this state. A foreign person that owns or holds agricultural land in this state on the effective date of the amendatory act that added this section may continue to own or hold the agricultural land, but shall not purchase or otherwise acquire additional agricultural land in this state.

(2) Subsection (1) does not apply to the following:

(a) Agricultural land that is acquired by devise or descent if that agricultural land is sold or otherwise disposed of no later than 2 years after the date of acquisition.

(b) A bona fide encumbrance on agricultural land taken for security.

(c) Agricultural land that is acquired by a process of law in the collection of a debt, by a deed in lieu of foreclosure, under a forfeiture of a contract for deed, or by any procedure for the enforcement of a lien or claim on the agricultural land, whether created by mortgage or otherwise if all of the following conditions are met:

(i) The agricultural land is sold or otherwise disposed of no later than 2 years after the date of acquisition.

(ii) Pending the sale or disposition, the agricultural land is not used for a purpose other than farming, and the agricultural land is not used for farming except under lease to a person not subject to the restriction under subsection (1).

(3) A person that purchases or otherwise acquires agricultural land in this state after the effective date of the amendatory act that added this section, and whose status changes so that the person becomes a foreign person shall divest itself of all right, title, and interest in the agricultural land no later than 2 years after the date of the change in status.

(4) A foreign person that owns agricultural land on or after the effective date of the amendatory act that added this section shall register the agricultural land with the secretary of state within 60 days after the effective date of the amendatory act that added this section or within 60 days after acquiring the agricultural land, whichever is later. The registration must be in a form and manner prescribed by the secretary of state and contain all of the following information:

(a) The name of the owner of the agricultural land.

(b) If the owner of the agricultural land is an agent, trustee, or fiduciary of a foreign business or foreign government, the name of any principal for whom that agricultural land was acquired as agent, trustee, or fiduciary.

(c) The location and number of acres of the agricultural land by municipality and county.

(d) The date the agricultural land was acquired.

(5) If a foreign person acquires or holds agricultural land in violation of this section, the secretary of state shall report the violation to the attorney general.

(6) On receipt of the report under subsection (5), the attorney general shall do all of the following:

(a) Initiate an action in the circuit court of any county in which the agricultural land is located.

(b) File notice of the pendency of the action initiated under subdivision (a) with the register of deeds in each county in which any of the agricultural land is located.

(7) In any action initiated under subsection (6), if the court finds that the foreign person violated this section, the court shall do 1 of the following, as applicable:

(a) If the court finds that the agricultural land at issue was acquired or held in violation of this section, do both of the following:

(i) Enter an order declaring that the agricultural land has been acquired or held in violation of this section and file a copy of that order with the register of deeds in each county in which any portion of the agricultural land is located.

(ii) Declare the agricultural land escheated to this state and order the sale of the agricultural land in the same manner as provided by law for the foreclosure of a mortgage on real estate for default of payment. The proceeds of this sale must be used to pay court costs and the remaining funds, if any, must be paid to the person divested of the agricultural land.

(b) If the court finds that a foreign person failed to timely register the agricultural land under subsection (4), impose a civil fine of not more than $2,000.00 for each violation.

(8) A person that acquires or holds agricultural land in violation of this section remains in violation of this section for as long as the person holds an interest in the agricultural land.

(9) As used in this section:

(a) "Agricultural land" means land suitable for use in farming and includes any right or interest in such land.

(b) "Business entity" means a business as that term is defined in section 2 of the Michigan campaign finance act, 1976 PA 388, MCL 169.202.

(c) "Farming" means that term as defined in section 2 of the Michigan family farm development act, 1982 PA 220, MCL 285.252.

(d) "Foreign business" means a corporation incorporated under the laws of a foreign country, or a business entity, whether or not incorporated, in which a majority interest is owned directly or indirectly by a foreign government. Legal entities, including, but not limited to, trusts, holding companies, multiple corporations, and other business arrangements, do not affect the determination of ownership or control of a foreign business.

(e) "Foreign government" means a government other than the government of the United States, its states, territories, or possessions.

(f) "Foreign person" means a foreign business or foreign government, or an agent, trustee, or fiduciary of a foreign business or foreign government.