General Assembly: 77 (1998 Regular GA) - Chapter 1110 - Agricultural landholding restrictions and reporting requirements


Published: 1998-04-16

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231 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION CH.1110

CHAPTER 1110 AGRICULTURAL LANDHOLDING RESTRICTIONS AND REPORTING

REQUIREMENTS

H.F.2335

AN ACT relating to persons holding interests in agricultural land and providing penalties and an effective date.

Be It Enacted by the General Assembly of the State of Iowa:

DIVISION I LANDHOLDING RESTRICTIONS

SUBCHAPTER I - GENERAL

Section 101. NEW SECTION. 10.1 DEFINITIONS. As used in this chapter and in chapter lOB, unless the context otherwise requires: 1. "Actively engaged in farming" means that a natural person, including a shareholder or

an officer, director, or employee of a corporation, or a member or manager of a limited liability company, does any of the following:

a. Inspects the production activities periodically and furnishes at least half of the value of the tools used for crop or livestock production and pays at least half the direct cost of crop or livestock production.

b. Regularly and frequently makes or takes an important part in making management decisions substantially contributing to or affecting the success of the farm operation.

c. Performs physical work which significantly contributes to crop or livestock produc- tion.

2. "Agricultural land" means the same as defined in section 9H.1. 3. "Authorized entity" means an authorized farm corporation; authorized limited liability

company; limited partnership, other than a family farm limited partnership; or an autho- rized trust as defined in section 9H.l.

4. "Commodity share landlord" means a natural person or a general partnership as pro- vided in chapter 486 in which all partners are natural persons, who owns at least one hundred fifty acres of agricultural land, if the owner receives rent on a commodity share basis, which may be either a share of the crops or livestock produced on the land.

5. "Cooperative association" means an entity which is structured and operated on a coop- erative basis pursuant to 26 U.S.C. § 1381 (a) and which meets the definitional requirements of an association as provided in 12 U.S.C. § 1141 (j)(a) or 7 U.S.C. § 291.

6. "Family farm entity" means a family farm corporation, family farm limited liability company, family farm limited partnership, or family trust, as defined in section 9H.1.

7. "Farm estate" means the real and personal property of a decedent, a ward, or a trust as provided in chapter 633, if at least sixty percent of the gross receipts from the estate comes from farming.

8. "Farmers cooperative association" means a cooperative association organized under chapter 490 or 499, if all of the following conditions are satisfied:

a. All of the following apply: (1) Qualified farmers must hold at least a fifty-one percent equity interest in the coopera-

tive association, including fifty-one percent of each class of members' equity. (2) The following persons must hold at least a seventy percent equity interest in the

cooperative association, including seventy percent of each class of members' equity: (a) A qualified farmer. (b) A family farm entity. (c) A commodity share landlord.

CH.ll10 LAWS OF THE SEVENTY-SEVENTH GA., 1998 SESSION 232

b. As used in this subsection, "members' equity" includes but is not limited to issued shares, including common stock or preferred stock, regardless of a right to receive dividends or earning distributions. However, "members' equity" does not include nonvoting common stock or nonvoting membership interests. A security such as a warrant or option that may be converted to voting stock shall be considered as issued shares.

c. For purposes of this subsection, a person who was a qualified person within the last ten years shall be treated as a qualified person.

9. "Farmers cooperative limited liability company" means a limited liability company organized under chapter 490A, if cooperative associations hold one hundred percent of all membership interests in the limited liability company. Farmers cooperative associations must hold at least seventy percent of all membership interests in the limited liability com- pany. If more than one type of membership interest is established, including any series as provided in section 490A.305 or any class or group as provided in section 490A.307, farmers cooperative associations must hold at least seventy percent of all membership interests of that type.

10. "Farmers entity" means a networking farmers entity, farmers cooperative limited li- ability company, or farmers cooperative association.

11. "Farming" means the same as defined in section 9H.l. 12. "Grain" means the same as defined in section 203.1. 13. "Intra-company loan agreement" means an agreement involving a loan, if the parties

to the agreement are members of the same farmers cooperative limited liability company, and according to the terms of the loan a member which is a regional cooperative association directly or indirectly loans money to a member which is a farmers cooperative association, on condition that the money, including any interest, must be repaid by the member which is a farmers cooperative association to the regional cooperative association or another person. A loan agreement does not include an operating loan agreement, in which all of the follow- ing apply:

a. The money is required to be repaid within ninety days from the date that the farmers cooperative association receives the money, and the money is actually repaid by that date.

b. The money is used to pay for reasonable and ordinary expenses of the farmers coopera- tive association in conducting its affairs.

14. "Livestock" means an animal belonging to the bovine, caprine, equine, ovine, or por- cine species, ostriches, rheas, emus, farm deer as defined in section 481A.l, or poultry.

15. "Networking farmers corporation" means a corporation, other than a family farm corporation as defined in section 9H.l, organized under chapter 490 if all of the following conditions are satisfied:

a. All of the following apply: (1) Qualified farmers must hold at least fifty-one percent of all issued shares of the corpo-

ration. If more than one class of shares is authorized, qualified farmers must hold at least fifty-one percent of all issued shares in each class.

(2) Qualified persons must hold at least seventy percent of all issued shares of the corpo- ration. If more than one class of shares is authorized, qualified persons must hold at least seventy percent of all issued shares in each class.

b. As used in paragraph "a", "issued shares" includes but is not limited to common stock or preferred stock, or each class of common stock or preferred stock, regardless of voting rights or a right to receive dividends or earning distributions. A security such as a warrant or option that may be converted to stock shall be considered as issued shares.

16. "Networking farmers entity" means a networking farmers corporation or networking farmers limited liability company.

17. "Networking farmers limited liability company" means a limited liability company, other than a family farm limited liability company as defined in section 9H.l, organized under chapter 490A if all of the following conditions are satisfied:

a. Qualified farmers must hold at least fifty-one percent of all membership interests in the limited liability company. If more than one type of membership interest is established,

233 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION CH.ll10

including any series as provided in section 490A.305 or any class or group as provided in section 490A.307, qualified farmers must hold at least fifty-one percent of all membership interests of that type.

b. Qualified persons must hold at least seventy percent of all membership interests in the limited liability company. If more than one type of membership interest is established, including any series as provided in section 490A.305 or any class or group as provided in section 490A.307, qualified persons must hold at least seventy percent of all membership interests of that type.

18. "Operation of law" means a transfer by inheritance, devise, or bequest, court order, dissolution decree, order in bankruptcy, insolvency, replevin, foreclosure, execution sale, the execution of ajudgment, the foreclosure of a real estate mortgage, the forfeiture of a real estate contract, or a transfer resulting from a decree for specific performance.

19. "Qualified farmer" means any of the following: a. A natural person actively engaged in farming. b. A general partnership as provided in chapter 486 in which all partners are natural

persons actively engaged in farming. c. A farm estate. 20. "Qualified commodity share landlord" means a commodity share landlord, if the

owner of the agricultural land was actively engaged in farming the land or a family member of the owner is or was actively engaged in farming the land, if the family member is related to the owner as a spouse, parent, grandparent, lineal ascendant of a grandparent or spouse, or other lineal descendant of a grandparent or spouse.

21. "Qualified person" means a person who is any of the following: a. A qualified farmer. b. A family farm entity. c. A qualified commodity share landlord. 22. "Regional cooperative association" means a cooperative association other than a

farmers cooperative association.

Sec. 102. NEW SECTION. 10.2 INTERESTS DESCRIBED. As used in this chapter, the following apply: 1. A person holds an interest in agricultural land if the person either directly or indirectly

owns or leases the agricultural land in this state. 2. A person holds an interest in a farmers entity if the person holds an interest as any of

the following: a. A shareholder of a networking farmers corporation. b. A member of a networking farmers limited liability company. c. A member of a farmers cooperative association. d. A member of a farmers cooperative limited liability company.

SUBCHAPTER II - RESTRICTIONS PART 1

NETWORKING FARMERS CORPORATIONS

Sec. 103. NEW SECTION. 10.3 LANDHOLDINGS RESTRICTED. l. Notwithstanding section 9H.4, a networking farmers corporation may hold agricul-

tura1land in this state if it meets all of the following conditions: a. The networking farmers corporation does not hold an interest in agricultural land of

more than six hundred forty acres. b. At least seventy-five percent of the networking farmers corporation's gross receipts are

from the sale of livestock or livestock products. 2. a. An interest in agricultural land held by a networking farmers corporation shall be

attributable as an interest in agricultural land held by a shareholder having an interest in the networking farmers corporation. The shareholder shall be deemed to hold an interest in

CH.III0 LAWS OF THE SEVENTY-SEVENTH GA, 1998 SESSION 234

agricultural land held by the networking farmers corporation in proportion to the interest that the shareholder holds in the networking farmers corporation.

b. Except to the extent provided in this paragraph, a shareholder holding agricultural land by attribution shall be subject to landholding restrictions imposed pursuant to the Code, including sections 9H.4, 9H.5, 501.103, and 567.3. However, notwithstanding section 9H.4, a cooperative association may hold an interest in any number of farmers entities, if the total number of acres held by the farmers entities and attributable to the cooperative associa- tion is six hundred forty acres or less.

c. The shareholder's proportionate interest shall be calculated by multiplying the number of acres of agricultural land held by the networking farmers corporation by the percentage interest in the networking farmers corporation held by the shareholder.

3. In the event of a transfer of an interest in the networking farmers corporation by opera- tion of law, the corporation may disregard the transfer for purposes of determining compli- ance with subsection 1 for a period of two years after the transfer.

Sec. 104. NEW SECTION. 1 0.4 MULTIPLE INTERESTS RESTRICTED. 1. A person who holds an interest in a networking farmers corporation holding an inter-

est in agricultural land pursuant to section 10.3 shall not hold an interest in another farmers entity if any of the following applies:

a. The person holds a twenty-five percent or greater interest in a networking farmers corporation having six or fewer stockholders.

b. The person holds a fifteen percent or greater interest in a networking farmers corpora- tion having seven or more stockholders.

2. A person who holds a majority interest in an authorized entity shall not hold a major- ity interest in a networking farmers corporation.

3. A qualified commodity share landlord who owns an interest in a networking farmers corporation holding agricultural land under section 10.3 must rent an additional one hun- dred fifty acres of agricultural land on a commodity share basis for each farmers entity holding agricultural land under this chapter in which the commodity share landlord ac- quires an interest.

PART 2 NETWORKING FARMERS

LIMITED LIABILITY COMPANIES

Sec. 105. NEW SECTION. 10.5 LANDHOLDINGS RESTRICTED. 1. Notwithstanding section 9H.4, a networking farmers limited liability company may

hold agricultural land in this state if it meets all of the following conditions: a. The networking farmers limited liability company does not hold an interest in agricul-

turalland of more than six hundred forty acres. b. At least seventy-five percent of the networking farmers limited liability company's

gross receipts from farming are from the sale of livestock or livestock products. 2. a. An interest in agricultural land held by a networking farmers limited liability com-

pany shall be attributable as an interest in agricultural land held by a member having an interest in the networking farmers limited liability company. The member shall be deemed to hold an interest in agricultural land held by the networking farmers limited liability company in proportion to the interest that the member holds in the networking farmers limited liability company.

b. Except to the extent provided in this paragraph, a member holding agricultural land by attribution shall be subject to landholding restrictions imposed pursuant to the Code, in- cluding sections 9H.4, 9H.5, 501.103, and 567.3. However, notwithstanding section 9H.4, a cooperative association may hold an interest in any number of farmers entities, if the total number of acres held by the farmers entities and attributable to the cooperative association is six hundred forty acres or less.

235 LAWS OFTHE SEVENTY-SEVENTH G.A., 1998 SESSION CH. 1110

c. The member's proportionate interest shall be calculated by multiplying the number of acres of agricultural land held by the networking farmers limited liability company by the percentage interest in the networking farmers limited liability company held by the mem- ber.

3. In the event of a transfer of an interest in the networking farmers limited liability company by operation of law, the networking farmers limited liability company may disre- gard the transfer for purposes of determining compliance with subsection 1 for a period of two years after the transfer.

Sec. 106. NEW SECTION. I 0.6 MULTIPLE INTERESTS RESTRICTED. 1. A person who holds an interest in a networking farmers limited liability company

holding an interest in agricultural land pursuant to section 10.5 shall not hold an interest in another farmers entity, if any of the following applies:

a. The person holds a twenty-five percent or greater interest in a networking farmers limited liability company having six or fewer members.

b. The person holds a fifteen percent or greater interest in a networking farmers limited liability company having seven or more members.

2. A person who holds a majority interest in an authorized entity shall not hold a major- ity interest in a networking farmers limited liability company.

3. A qualified commodity share landlord who owns an interest in a networking farmers limited liability company holding agricultural land under section 10.5 must rent an addi- tional one hundred fifty acres of agricultural land on a commodity share basis for each farmers entity holding agricultural land under this chapter in which the commodity share landlord acquires an interest.

PART 3 FARMERS COOPERATIVE ASSOCIATIONS

Sec. 107. NEW SECTION. 10.7 LANDHOLDINGS RESTRICTED. 1. Notwithstanding section 9H.4, a farmers cooperative association may hold agricul-

turalland in this state if it meets all of the following conditions: a. The farmers cooperative association does not hold an interest in agricultural land of

more than six hundred and forty acres. b. The farmers cooperative association does not produce, including by planting or har-

vesting, forage or grain on agricultural land in which the farmers cooperative association holds an interest. However, the farmers cooperative association may enter into an agree- ment under a lease or production contract with a person to produce the forage or grain, if the farmers cooperative association does not receive forage or grain in payment under the agree- ment. The lease or contract may specify the type of forage or grain that must be produced and provide that the farmers cooperative association has a right to purchase the forage or grain on the same terms and conditions as the highest bona fide offer received by the person for the forage or grain, within a period agreed to by the parties to the lease or production contract.

2. a. Except as provided in this section, an interest in agricultural land held by a farmers cooperative association shall be attributable as an interest in agricultural land held by a member having an interest in the farmers cooperative association. The member shall be deemed to hold an interest in agricultural land held by the farmers cooperative association in proportion to the interest that the member holds in the farmers cooperative association.

b. Except to the extent provided in this paragraph, a member holding agricultural land by attribution shall be subject to landholding restrictions imposed pursuant to the Code, in- cluding sections 9H.4, 9H.5, 501.103, and 567.3. However, notwithstanding section 9H.4, all of the following shall apply:

(1) A cooperative association may hold an interest in any number of farmers entities, if the total number of acres held by the farmers entities and attributable to the cooperative association is six hundred forty acres or less.

CH.1110 LAWS OF THE SEVENTY-SEVENTH GA, 1998 SESSION 236

(2) An interest in agricultural land held by a farmers cooperative association shall not be attributable to a member who is an entity organized under state law, if the entity holds a five percent or less interest in the farmers cooperative association.

c. The member'S proportionate interest shall be calculated by multiplying the number of acres of agricultural land held by the farmers cooperative association by the percentage interest in the farmers cooperative association held by the member.

3. In the event of a transfer of an interest in a farmers cooperative association by opera- tion of law, the association may disregard the transfer for purposes of determining compli- ance with subsection 1 for a period of two years after the transfer.

Sec. 108. NEW SECTION. 1 0.8 MULTIPLE INTERESTS RESTRICTED. 1. A person who holds an interest in a farmers cooperative association holding an inter-

est in agricultural land pursuant to section 10.7 shall not hold an interest in another farmers entity if any of the following applies:

a. The person holds a twenty-five percent or greater interest in a farmers cooperative association having six or fewer members.

b. The person holds a fifteen percent or greater interest in a farmers cooperative associa- tion having seven or more members.

2. A person who holds a majority interest in an authorized entity shall not hold a major- ity interest in a farmers cooperative association.

Sec. 109. NEW SECTION. lO.8A PROCEDURE FOR ACQUISITION - REVERSE REF- ERENDUM; DISSENT.

A farmers cooperative association shall not acquire an interest in agricultural land or in a farmers entity, unless all of the following apply:

1. The board of directors of the farmers cooperative association adopts a resolution au- thorizing the acquisition. Except as provided in this section, the resolution shall become effective thirty-one days from the date that the resolution was adopted. The farmers coop- erative association is not required to comply with the procedures of this section for as long as the resolution remains in effect. The resolution shall contain all of the following:

a. A declaration stating that the farmers cooperative association reserves the right to acquire agricultural land or an interest in a farmers entity under this chapter.

b. A description of a planned acquisition, if any, including the location of agricultural land planned to be acquired, the identity of any farmers entity in which the farmers coopera- tive association plans to acquire an interest, and the nature of any farming operation which is planned to occur on land acquired by the farmers cooperative association or conducted by the farmers entity.

c. The date that the resolution was adopted and the date that it will take effect. 2. Within five days following the date that the resolution authorizing the farmers coop-

erative association to acquire an interest in agricultural land or acquire an interest in a farmers entity is adopted, the farmers cooperative association must provide notice of the resolution as provided in this section. The notice shall be in the following form:

NOTICE MEMBERS OF THE (INSERT NAME OF THE FARMERS

COOPERATIVE ASSOCIATION) THE (INSERT NAME OF THE FARMERS COOPERATIVE ASSOCIATION) IS PLAN-

NING ON ACQUIRING AN INTEREST IN AGRICULTURAL LAND WHICH MAY BE USED FOR FARMING OR ACQUIRING AN INTERESTIN A BUSINESS THAT OWNS AGRICUL- TURAL LAND THAT MAY BE USED FOR FARMING. UNDER IOWA CODE CHAPTER 10, THE (INSERT NAME OF THE FARMERS COOPERATIVE ASSOCIATION) IS A FARM- ERS COOPERATIVE ASSOCIATION. WITHIN A LIMITED TIME PERIOD: (1) VOTING MEMBERS MAY PETITION A FARMERS COOPERATIVE ASSOCIATION TO REQUIRE A MEMBERSHIP VOTE TO APPROVE THE ACQUISITION; AND (2) ALL HOLDERS OF MEMBERS' EQUITY MAY DEMAND PAYMENT OF THE FAIR VALUE OF THEIR INTERESTS.

237 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION CH. 1110

a. The notice must be published in a newspaper having a general circulation in the county where the farmers cooperative association is located as provided in section 618.3. The notice shall be printed as provided in section 618.17.

b. The notice shall be delivered to all holders of members' equity in the farmers coopera- tive association, including members and shareholders, by mailing the notice to the holder's last known address as shown on the books of the farmers cooperative association. The notice shall be accompanied by a copy of the resolution adopted by the board pursuant to this section, and a copy of this section.

3. Within thirty days following the date that the resolution authorizing the farmers coop- erative association to acquire an interest in agricultural land or acquire an interest in a farmers entity is adopted, at least twenty percent of the voting members of the farmers cooperative association may file a petition with the board of directors demanding a referen- dum under this subsection.

a. If a valid petition is filed, the board of directors shall call a special referendum of voting members at a regular or special meeting, as provided in section 499.27. The filing of the petition suspends the effectiveness of the resolution until a referendum is conducted as provided in this subsection.

b. The resolution shall not become effective as otherwise provided in this section, until the resolution is approved by a majority vote of the voting members of the farmers coopera- tive association casting ballots at the meeting to conduct the referendum.

4. a. Within thirty days following the date that the resolution authorizing the farmers cooperative association to acquire an interest in agricultural land or acquire an interest in a farmers entity is adopted, a holder of members' equity, including a member or shareholder, may dissent to an acquisition as expressed in the resolution adopted by the board of direc- tors under this section.

b. The holder of members' equity shall dissent by filing a demand with the board of directors. The farmers cooperative association shall pay the holder the fair value of that holder's interest as if the holder were a member dissenting to a merger or consolidation, as provided in section 499.66, upon surrender of the holder's evidence of equity in the farmers cooperative association, including a certificate of membership or shares.

c. The farmers cooperative association is not required to pay the holder of members' equity the fair value of that holder'S interest as provided in this subsection, if the resolution provided for in this section does not become effective.

PART 4 FARMERS COOPERATIVE LIMITED

LIABILITY COMPANIES

Sec. 110. NEW SECTION. 10.9 LANDHOLDINGS RESTRICTED. 1. Notwithstanding section 9H.4, a farmers cooperative limited liability company may

hold agricultural land in this state if it meets all of the following conditions: a. The farmers cooperative limited liability company does not hold an interest in agricul-

turalland of more than six hundred and forty acres. b. The farmers cooperative limited liability company does not produce, including by plant-

ing or harvesting, forage or grain on agricultural land in which the farmers cooperative limited liability company holds an interest. However, the farmers cooperative limited liabil- ity company may enter into an agreement under a lease or production contract with a person to produce the forage or grain, if the farmers limited liability company does not receive forage or grain in payment under the agreement. The lease or contract may specify the type of forage or grain that must be produced and provide that the farmers cooperative limited liability company has a right to purchase the forage or grain on the same terms and conditions as the highest bona fide offer received by the person for the forage or grain, within a period agreed to by the parties to the lease or production contract.

CH.1110 LAWS OF THE SEVENTY-SEVENTH GA, 1998 SESSION 238

c. Less than fifty percent of the interest in the farmers cooperative limited liability com- pany is held by members which are parties to intra-company loan agreements. If more than one type of membership interest is established, including any series as provided in section 490A.305 or any class or group as provided in section 490A.307, less than fifty percent of the interest in each type of membership shall be held by members which are parties to intra-company loan agreements.

d. The farmers cooperative limited liability company does not own swine or contract for the care and feeding of swine, if a member of the farmers cooperative limited liability com- pany is a regional cooperative association.

2. a. An interest in agricultural land held by a farmers cooperative limited liability com- pany shall be attributable as an interest in agricultural land held by a member cooperative association of the farmers cooperative limited liability company. The member cooperative association shall be deemed to hold an interest in agricultural land held by the farmers cooperative limited liability company in proportion to the interest that the member coopera- tive association holds in the limited liability company.

b. Except to the extent provided in this paragraph, a member holding agricultural land by attribution shall be subject to landholding restrictions imposed pursuant to the Code, in- cluding sections 9H.4, 9H.5, 501.103, and 567.3. However, notwithstanding section 9H.4, a cooperative association may hold an interest in any number of farmers entities, if the total number of acres held by the farmers entities and attributable to the cooperative association is six hundred forty acres or less.

c. The member cooperative association's proportionate interest shall be calculated by multiplying the number of acres of agricultural land held by the farmers cooperative limited liability company by the percentage interest in the limited liability company held by the cooperative association as a member.

3. In the event of a transfer of an interest in the farmers cooperative limited liability company by operation of law, the farmers cooperative limited liability company may disre- gard the transfer for purposes of determining compliance with subsection 1 for a period of two years after the transfer.

SUBCHAPTER III - PENALTIES

Sec. Ill. NEW SECTION. 10.10 LANDHOLDING RESTRICTIONS - PENALTIES. A person violating the landholding restrictions in section 10.3, 10.5, 10.7, or 10.9 shall be

assessed a civil penalty of not more than ten thousand dollars and shall divest itself of any land held in violation of the section within one year after judgment is entered ordering the farmers entity to comply with that section, as provided in section 10.12.

Sec. 112. NEW SECTION. 10.11 MULTIPLE INTERESTS RESTRICTED - PENAL- TIES.

1. A civil penalty of not more than one thousand dollars may be imposed on a person who becomes one of the following:

a. A stockholder of a networking farmers corporation as prohibited in section 10.4. b. A member of a networking farmers limited liability company as prohibited in section

10.6. c. A member of a farmers cooperative association as prohibited in section 10.8. 2. The person violating the section shall divest the interest held by the person in a farmers

entity or authorized entity as is necessary to comply with this chapter, as provided in section 10.12.

Sec. 113. NEW SECTION. 10.12 DIVESTITURE PROCEEDINGS. The court may determine the method of divesting an interest held by a person found to be

in violation ofthis chapter. A financial gain realized by a person who disposes of an interest held in violation of this chapter shall be forfeited to the state's general fund. All court costs and fees shall be paid by the person holding the interest in violation of the section.

239 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION CH. 1110

Sec. 114. NEW SECTION. 10.13 INJUNCTIVE RELIEF. The courts of this state may prevent and restrain violations of this chapter through the

issuance of an injunction. The attorney general or a county attorney shall institute suits on behalf of the state to prevent and restrain violations of this chapter.

DIVISION II REPORTS

Sec.201. NEW SECTION. 10B.1 DEFINITIONS. As used in this chapter, unless the context otheIWise requires: 1. "Agricultural land" means the same as defined in section 9H.1. 2. "Cooperative association" means any entity organized on a cooperative basis, includ-

ing an association of persons organized under chapter 497,498, or 499; an entity composed of entities organized under those chapters; or a cooperative corporation organized under chapter 501.

3. "Corporation" means a domestic or foreign corporation, including an entity organized pursuant to chapter 490, or a nonprofit corporation.

4. "Farming" means the same as defined in section 9H.1. 5. "Foreign business" means the same as defined in section 567.l. 6. "Foreign government" means the same as defined in section 567.1. 7. "Limited liability company" means a foreign or domestic limited liability company,

including a limited liability company as defined in section 490A.1 02. 8. "Limited partnership" means a foreign or domestic limited partnership, including a

limited partnership as defined in section 487.101, subsection 7. 9. "Nonprofit corporation" means any of the following: a. A corporation organized under the provisions of former chapter 504 or chapter 504A. b. A corporation which qualifies under Title 26, section 501, of the United States Code. 1 O. "Nonresident alien" means the same as defined in section 567.l. 11. "Reporting entity" means any of the following: a. A corporation, other than a family farm corporation as defined in section 9H.1, includ-

ing an authorized farm corporation as defined in section 9H.1 or networking farmers corpo- ration as defined in section 10.1, holding an interest in agricultural land in this state.

b. A cooperative association holding an interest in agricultural land in this state. c. A limited partnership, other than a family farm limited partnership as defined in sec-

tion 9H.1, holding an interest in agricultural land in this state. d. A person acting in a fiduciary capacity or as a trustee on behalf of a person, including

a corporation, cooperative association, limited liability company, or limited partnership, which holds in a trust, other than through a family trust as defined in section 9H.1, includ- ing through an authorized trust, an interest in agricultural land in this state.

e. A limited liability company, other than a family farm limited liability company as defined in section 9H.1, including an authorized limited liability company as defined in section 9H.1, or a networking farmers limited liability company or farmers cooperative limited liability company as defined in section 10.1, holding an interest in agricultural land in this state.

f. A foreign business holding an interest in agricultural land in this state as provided in chapter 567.

g. A foreign government holding an interest in agricultural land in this state as provided in chapter 567.

h. A nonresident alien holding an interest in agricultural land in this state as provided in chapter 567.

Sec. 202. NEW SECTION. 10B.2 INTERESTS DESCRIBED. A reporting entity holds an interest in agricultural land if the reporting entity directly or

indirectly owns or leases agricultural land in this state.

CH.ll10 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION 240

Sec. 203. NEW SECTION. 10B.3 PERSONS REQUIRED TO FILE REPORTS. The reports required under section 1 OB.4 shall be signed and filed by the following indi-

viduals required to submit reports pursuant to that section for their respective reporting entities:

1. A person serving as the president or other officer or authorized representative of a corporation.

2. A person serving as the president or other officer or authorized representative of a cooperative association.

3. A person acting as the general partner of a limited partnership. 4. A person acting in a fiduciary capacity or as a trustee on behalf of a person. 5. A person who is a member, manager, or authorized representative of a limited liability

company. 6. A person serving as the president or other officer or authorized representative of a

foreign business. 7. A person authorized to make the report by a foreign government. 8. A nonresident alien or an agent, trustee, or fiduciary of the nonresident alien.

Sec. 204. NEW SECTION. 10B.4 REPORTING REQUIREMENTS. 1. An annual report shall be filed by a reporting entity with the secretary of state on or

before March 31 of each year as required by rules adopted by the secretary of state pursuant to chapter 17 A. The reports shall be filed on forms prepared and supplied by the secretary of state.

2. A report required pursuant to this section shall contain information for the last year regarding the reporting entity as required by the secretary of state which shall at least include all of the following:

a. The name and address of the reporting entity. b. The name and address of the person supervising the daily operations on the agricul-

turalland in which the reporting entity holds an interest. c. The following information regarding each person who holds an interest in the report-

ing entity: (1) The name and address of the person. (2) The person's citizenship, if other than the United States. (3) The percentage interest held by the person in the reporting entity, unless the person is

a natural person who holds less than a ten percent interest in a reporting entity. d. The percentage interest that a reporting entity holds in another reporting entity, and

the number of acres of agricultural land that is attributable to the reporting entity which holds an interest in another reporting entity as provided in chapter 10.

e. A certification that the reporting entity meets all of the requirements to lawfully hold agricultural land in this state.

f. The number of acres of agricultural land held by the reporting entity, including the following:

(1) The total number of acres in the state. (2) The number of acres in each county identified by county name. (3) The number of acres owned. (4) The number of acres leased. (5) The number of acres held other than by ownership or lease. (6) The number of acres used for the production of row crops. 3. A reporting entity other than a foreign business, foreign government, or nonresident

alien shall be excused from filing a report with the secretary of state during any year in which the reporting entity holds an interest in less than twenty acres of agricultural land in this state and the gross revenue produced from all farming on the land equals less than ten thousand dollars.

241 LAWS OF THE SEVENTY-SEVENTH G.A., 1998 SESSION CH.llli

Sec. 205. NEW SECTION. IOB.5 USE OF REPORTS. 1. The secretary of state shall notify the attorney general when the secretary of state has

reason to believe a violation of this chapter has occurred. 2. Information provided in reports required in this chapter shall be made available to

members of the general assembly and appropriate committees of the general assembly in order to determine the extent that agricultural land is held in this state by corporations and other business and foreign entities and the effect of such land ownership upon the economy of this state. The secretary of state shall assist any committee of the general assembly studying these issues.

Sec. 206. NEW SECTION. IOB.6 PENALTIES. 1. The failure to timely file a report or the filing of false information in a report as provided

in section 1 OB.4 is punishable by a civil penalty not to exceed one thousand dollars. 2. The secretary of state shall notify a reporting entity which the secretary of state has

reason to believe is required to file a report and who has not filed a timely report, that the person may be in violation of section 10B.4. The secretary of state shall include in the notice a statement of the penalty which may be assessed if the required report is not filed within thirty days. The secretary of state shall refer to the attorney general any reporting entity which the secretary of state has reason to believe is required to report if, after thirty days from receipt of the notice, the reporting entity has not filed the required report. The attorney general may, upon referral from the secretary of state, file an action in district court to seek the assessment of a civil penalty of one hundred dollars for each day the report is not filed.

Sec. 207. SUSPENSION OF REPORTING REQUIREMENTS. 1. A person required to file a report with the secretary of state pursuant to this chapter is

not required to file a report with the secretary of state pursuant to section 9H.5A or 501.103, subsection 3, or section 567.8.

2. This section is repealed on July 1, 2000.

DIVISION III EFFECTIVE DATE

Sec. 301. EFFECTIVE DATE. This Act, being deemed of immediate importance, takes effect upon enactment.

Approved April 16, 1998

CHAPTER 1111 FORCIBLE FELON LIABILITY

H.F.2336

AN ACT relating to the assumption of risk by and liability of forcible felons and persons aiding and abetting in the commission of forcible felonies for damages resulting from the offenders' criminal conduct.

Be It Enacted by the General Assembly of the State of Iowa:

Section 1. NEW SECTION. 670A.l DEFINITIONS. As used in this chapter, unless the context otherwise requires: 1. "Act" means an act as defined under section 702.2. 2. "Convicted" means a finding of guilt, irrespective of imposition or execution of any