TOPEKA — Republican Sen. Jeff Longbine says a bill passed by the Legislature stripping Kansas property from companies and individuals tied to China, Iran, North Korea and other adversarial nations was so profoundly unconstitutional that $10 million should be set aside in the budget to defend against lawsuits.
The bill would prohibit people or entities from “countries of concern” from acquiring nonresidential property within a 100-mile radius of Kansas military installations or comparable facilities in adjacent states. Anyone holding substantial property within the security zones must register with the attorney general and divest of the property unless granted an exemption by federal officials.
Attorney General Kris Kobach would be responsible for investigating reports of illegal ownership and for seeking court orders to force divestiture of property held by national security risks. A separate provision would allow those forced to sell property to file claims against the state for compensation if fire-sale transactions generated prices below fair-market value.
“There is nothing constitutional about this bill,” Longbine said. “You cannot take legally owned land away from somebody. In fact, this is so unconstitutional that we’re going to bribe the affected party by paying them back their losses.”
Sen. Ethan Corson, a Johnson County Democrat and an attorney, said the state-sanctioned dragnet would trigger a landslide of lawsuits. Flipping a switch to redefine legal ownership of property to illegal possession of property would justifiably raise due process claims and inspire breach of contract suits, he said.
In the Senate, the vote for Senate Bill 172 was 24-14. The tally in the House was 86-39. A veto by Gov. Laura Kelly would be a possibility. She rejected a related bill blocking government agencies in Kansas from acquiring drones made from parts manufactured in the same countries of concern.
‘I’m here to spy on you’
Rep. Sean Tarwater, a Stilwell Republican who led House negotiations on the bill, said it was among the important pieces of legislation considered by the 2024 Legislature. He said he was part of closed-door briefings hosted by the Kansas Bureau of Investigation that outlined consequential threats posed by foreign nationals.
“The exposure and the risk are very real,” Tarwater said. “This could be the most important bill that we look at this year, and probably in the last five years and maybe the next several. This is very serious to me.”
He said the Legislature should follow the lead of Congress, which delivered bipartisan support for legislation challenging ownership of the video-sharing app TikTok. A bill signed by President Joe Biden offered TikTok’s Beijing-based parent company ByteDance one year to sell the company or deal with a U.S. ban.
Shawnee Republican Mike Thompson, the Republican who negotiated on behalf of the Senate, said covert operatives from China, Cuba, Iran, North Korea, Russia and Venezuela had set their sights on harming the United States. Targets included value-rich military installations and other national security infrastructure. Beyond Fort Riley, Fort Leavenworth and McConnell Air Force Base, Thompson said the state had to protect Kansas National Guard or U.S. Army Reserve facilities as well as infrastructure that included the National Bio and Agro-Defense Facility in Manhattan.
Advocates of the bill expressed alarm with construction of a $94.7 million plant in Johnson County by Cnano Technology USA. The American company, owned by a company in China, would operate a 330,000-square-foot manufacturing facility, with nearly 100 employees, to produce liquid conductive paste used in power tools, cell phones and vehicle batteries.
“Understand that China is a communist country,” Thompson said. “There may be some people here in the United States from China that do not have any nefarious intent. It’s very difficult to identify the ones that are. They’re not going to hold up a sign and say, ‘Hey, by the way, I’m here to spy on you.’”
Thompson speculated securing a U.S. Department of Commerce exemption from the state law could be as easy as filling out an online form, but an attorney with expertise in work of the federal Committee on Foreign Investment in the United States said a review by CFIUS was a lengthy and expensive process.
“Do we just ignore the threats?” Thompson said. “With more and more of the open borders, we’ve got tens of thousands of military-age Chinese men crossing the southern border. Do we ignore that?”
Heart of the bill
The bill, known as the Kansas Land and Military Installation Protection Act, would exempt anyone with a CFIUS clearance or a national security agreement with the U.S. Department of Defense. It wouldn’t apply to citizens or companies associated with a country of concern unless ownership exceeded 10% of the value of a business or land in Kansas.
If divesture was mandated, the owner must register with the attorney general within 30 days of the divesture’s effective date. The foreign principal would have 360 days to sell the property.
The attorney general would be responsible for establishing by Jan. 1, 2025, procedures for reporting divesture actions in Kansas. In addition to annual reports by the attorney general, Kansas State University would compile a summary of foreign holdings of real property in the state.
Property protected by the 100-mile shield — an earlier version of the bill set the distance at 150 miles — would be defined as land, buildings or other structures owned or controlled by military departments as well as “any other federal or state agency that is critical to the safety and security of Kansas or the United States.”
The list of foreign adversary countries would be set by the U.S. government and include organizations on the federal terrorist list. However, Taiwan would be specifically excluded from any such a list. The bill wouldn’t apply to U.S. citizens or the country’s lawful permanent residents.
Originally, opponents of the bill included Kansas Farm Bureau, Kansas Livestock Association, Syngenta, Advance Power Alliance, Kansas Agribusiness Retailers Association.
Legislative debate
Sen. Tom Holland, D-Baldwin City, said he was curious proponents of the bill included American Global Strategies and State Armor Action. He theorized they served companies poised to jump on business opportunities created by state bans on foreign property ownership.
“This, to me, is another example of why our legislative process is broke,” said Holland, who objected to the damaging influence of special interests. “It waives a banner saying, ‘If you are a foreign-owned entity and are thinking about doing business in Kansas — watch out.’”
Sen. Jeff Pittman, D-Leavenworth, said the Legislature should work with federal agencies to reshape the bill into something that effectively assisted with identification of bad actors.
Despite representing a Senate district with a strong military presence, Pittman said he hadn’t heard from any Department of Defense officials seeking intervention of the Kansas attorney general in the spy-catching business.
Hutchinson Rep. Jason Probst, a Democrat, said the bill was built on the idea Americans should acknowledge spies were in their midst and the way to deal with reality was to strip them of real property. He recalled a dangerous era when it was common for the U.S. government to interrogate people about whether they were or ever had been a member of the Communist Party.
“A lot of bad things in our history have begun with fear,” Probst said. “We don’t have a great track record of behaving responsibly when we’re afraid.”
Rep. Pat Proctor, a Leavenworth Republican who served in the U.S. Army and owns the Baan Thai Restaurant chain, said the nation’s response to foreign adversaries did lead to mistakes in the past. He included among missteps the incarceration during World War II of people with Japanese heritage.
“We do sometimes overreact and there are some dark spots in our history,” Proctor said. “I do not believe this bill falls into that category.” He said anyone who didn’t think China was interested in acquiring property near military installations to engage in spy activities was “just burying your head in the sand.”
House Majority Leader Chris Croft, a retired U.S. Army colonel and Overland Park Republican, said national security wasn’t the exclusive responsibility of the federal government and the issue shouldn’t be viewed through a partisan lens.
“In my mind, this is about an issue of survival,” he said.