Relating To Ownership Of Agricultural Land.
SB245 would create a new chapter in the Hawaii Revised Statutes restricting who may own agricultural land in the state and who may conduct farming operations on that land. The bill defines “prohibited entities” to include corporations, trusts, non-resident entities, and investment funds, and generally bars those entities from acquiring or holding any interest in agricultural land or engaging in farming in Hawaii. It also creates a category of exempt nonprofit entities and a narrow exemption pathway for certain locally controlled farming entities that are majority Hawaii-resident owned, primarily engaged in farming, limited in size, and not engaged in speculative landholding.
The bill sets out enforcement, reporting, and penalty provisions. The Department of Agriculture would be responsible for enforcement, rulemaking, annual reporting oversight for exempt entities, and supervising divestiture or restructuring. Violations would trigger a minimum fine of $50,000 per year of noncompliance and require divestiture of agricultural land or cessation of farming operations. Existing prohibited entities would have a five-year transition period to comply, with no extensions allowed. The act would take effect upon approval.
If enacted, SB245 would significantly change state law governing agricultural land ownership by adding a new statutory chapter that limits land acquisition and farming participation by certain business entities and nonresident or investment-oriented owners. It would affect corporations, trusts, investment funds, and other covered entities, while preserving an exemption for qualifying nonprofits and certain small, resident-controlled farming operations. The bill would also expand the Department of Agriculture’s regulatory and enforcement role and create new reporting, penalty, and divestiture obligations.
The bill’s stated purpose and structure suggest strong support for preserving family farms, local control of agricultural land, and food security in Hawaii. Because no committee transcripts or votes were provided, there is no recorded public debate in the supplied materials, but the bill text itself frames the measure as protective of local agriculture and narrowly tailored to avoid undue burdens on interstate commerce. Overall, the available record indicates a policy direction favoring local agricultural stewardship over outside ownership and speculative investment.
The main likely points of contention are the bill’s broad restrictions on corporations, trusts, nonresident entities, and investment funds, and whether those limits could affect capital access, farm financing, or business structures used in agriculture. Another likely issue is the bill’s interaction with interstate commerce and constitutional concerns, which the text attempts to address by stating that the law applies equally regardless of state of origin and is narrowly tailored. The exemption criteria for resident-controlled entities and the mandatory five-year divestiture period may also be debated by affected landowners, agricultural businesses, and potential investors.