9H.5 - RESTRICTIONS ON AUTHORIZED FARM CORPORATIONS, AUTHORIZED LIMITED LIABILITY COMPANIES, AUTHORIZED TRUSTS, AND LIMITED PARTNERSHIPS -- PENALTY.
9H.5 RESTRICTIONS ON AUTHORIZED FARM CORPORATIONS,
AUTHORIZED LIMITED LIABILITY COMPANIES, AUTHORIZED TRUSTS, AND
LIMITED PARTNERSHIPS -- PENALTY.
1. An authorized farm corporation, authorized limited liability
company, or authorized trust shall not, on or after July 1, 1987, and
a limited partnership other than a family farm limited partnership
shall not, on or after July 1, 1988, either directly or indirectly,
acquire or otherwise obtain or lease agricultural land, if the total
agricultural land either directly or indirectly owned or leased by
the authorized farm corporation, authorized limited liability
company, limited partnership, or authorized trust would then exceed
one thousand five hundred acres.
a. However, the restrictions provided in this subsection do
not apply to agricultural land that is leased by an authorized farm
corporation, authorized trust, or limited partnership to the
immediate prior owner of the land for the purpose of farming, as
defined in section 9H.1. Upon cessation of the lease to the
immediate prior owner, the authorized farm corporation, authorized
trust, or limited partnership shall, within three years following the
date of the cessation, sell or otherwise dispose of the agricultural
land leased to the immediate prior owner.
b. This subsection also does not apply to land that is held
or acquired and maintained by an authorized farm corporation,
authorized trust, or limited partnership to protect significant
elements of the state's natural open space heritage, including but
not limited to significant river, lake, wetland, prairie, forest
areas, other biologically significant areas, land containing
significant archaeological, historical, or cultural value, or fish or
wildlife habitats, as defined in rules adopted by the department of
natural resources.
2. a. A person shall not, after July 1, 1988, become a
stockholder of an authorized farm corporation, a beneficiary of an
authorized trust, a member of an authorized limited liability
company, or a limited partner in a limited partnership which owns or
leases agricultural land if the person is also any of the following:
(1) A stockholder of an authorized farm corporation.
(2) A beneficiary of an authorized trust.
(3) A limited partner in a limited partnership which owns or
leases agricultural land.
(4) A member of an authorized limited liability company.
b. However, this subsection shall not apply to limited
partners in a family farm limited partnership.
3. a. An authorized farm corporation, authorized trust,
authorized limited liability company, or limited partnership
violating this section shall be assessed a civil penalty of not more
than twenty-five thousand dollars and shall divest itself of any land
held in violation of this section within one year after judgment. A
civil penalty of not more than one thousand dollars may be imposed on
a person who becomes a stockholder of an authorized farm corporation,
beneficiary of an authorized trust, member of an authorized limited
liability company, or limited partner in a limited partnership in
violation of this section. The person shall divest the interest held
by the person in the corporation, trust, limited liability company,
or limited partnership to comply with this section. The court may
determine the method of divesting an interest held by a person found
to be in violation of this 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
this chapter.
b. The courts of this state may prevent and restrain
violations of this section 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
section.
4. As used in this section, "authorized trust" does not
include a revocable trust. Section History: Recent Form
87 Acts, ch 146, § 1
CS87, § 172C.5
88 Acts, ch 1191, § 4; 91 Acts, ch 172, §5
C93, § 9H.5
93 Acts, ch 39, §14--16; 94 Acts, ch 1153, §6; 2008 Acts, ch 1032,
§ 201
Referred to in § 10.3, 10.5, 10.7, 10.10, 15A.9