Testimony of Roger Johnson
Agriculture Commissioner
House Bill 1396
House Agriculture Committee
Peace Garden Room
January 31, 2003

Chairman Nicholas and members of the House Agriculture Committee, I am Jeff Weispfenning, presenting testimony on behalf of Commissioner of Agriculture Roger Johnson. I am here today to testify against HB 1396, which seeks to eliminate the "kinship requirement" in North Dakota's anti-corporate farming law. HB 1396 would, in effect, negate the purposefulness of the anti-corporate farming law in North Dakota.

Our Anti-corporate Farming Law Serves Us Well

The anti-corporate farming law was overwhelmingly approved by North Dakota voters in 1932 and serves our state well. Seven other states have since enacted anti-corporate farming legislation. The state of Nebraska has gone further and has made an anti-corporate farming measure a part of their state constitution. Why would we weaken our anti-corporate farming law when only recently other states have enacted similar safeguards or strengthened their laws? We should be cognizant of the lessons others have learned.

Agriculture has changed dramatically since the 1930's, but the same economic principals remain in play. North Dakota is an agricultural state, and agriculture is one of our driving industries. If allowed, corporations will farm our land - either directly or with tenant farmers. The anti-corporate farming law is just as applicable today as it was seventy years ago and is responsible public policy. It is still necessary to protect the economy of our state and the welfare of our independent farmers and ranchers.

Non-family Members Can Invest in Farms Under Current Law

Further, our current anti-corporate farming statute does not prohibit non-family members from investing in farms. There are many legal channels available (e.g. partnerships, limited partnerships, etc…) for anyone - family or non-family members - to invest in a farming operation.

Supporters of this bill will likely claim that North Dakota farmers need more access to capital. While I agree that farmers and ranchers need adequate access to capital, I do not believe that HB 1396 is an appropriate or necessary way to address that need.

Changing the Anti-Corporate Farming Law Will Not Improve Prices or Economic Concentration

As we are all well aware, prices remain low for many agricultural products and commodities. Changing or eliminating the anti-corporate farming law won't do anything about the low prices farmers receive for their products. In fact, it will likely exacerbate the problem.

Another major issue facing agriculture today is economic concentration, spurred by the corporate bottom line. The driving force for economic concentration is not economic efficiency but rather economic power, the exercise of which results in lower efficiencies, poorer services and ultimately higher prices for food. This bill would exacerbate economic concentration, precisely the opposite of what independent farmers and ranchers (and our consumers) need.

On the state level, agriculture needs tools to help farmers and ranchers develop and use new technologies, to grow new crops and livestock and to invest for themselves in grower-owned agricultural production, processing and distribution cooperatives. This bill would have the opposite effect.

The bottom line is that changing North Dakota's anti-corporate farming law won't make agriculture profitable for North Dakota farmers and ranchers. It will only drive our prices lower so the corporate bottom line can improve. Chairman Nicholas and committee members, I urge you to give HB 1396 a do not pass recommendation. I would be happy to answer any questions you may have.