Senate committee gives do-pass to bill restricting foreign principals from buying property near Arizona military sites

The Arizona Senate Military Affairs and Border Security Committee on Wednesday recommended passage of Senate Bill 11‑09, which would bar foreign principals from purchasing or holding a substantial interest in real property in Arizona if the tract is near certain military installations or critical infrastructure.

The bill, as read into the record by assistant research analyst Nicholas Gustaf, prohibits a foreign principal of a designated country from purchasing, owning, acquiring by grant or devise, or having a substantial interest of 30% or more in real property in Arizona, whether directly or indirectly. It exempts holdings where the owner divests within three years of acquisition; residential property up to two acres if it is the foreign principal’s sole property in the state; parcels at least 50 miles from military installations and critical infrastructure; and parcels at least 25 miles from Air Force ranges with total land areas between 500,000 and 2,500,000 acres. The bill also grandfathered property held on or before the effective date and bars use of the prohibition as the basis for a title‑insurance claim.

Nicholas Gustaf told the committee the measure requires the attorney general to bring superior‑court actions for violations, authorizes courts to order divestiture and directs county boards of supervisors to sell property. Sale proceeds would be used to satisfy valid liens, reimburse county treasurers and reimburse the attorney general’s costs; any remaining proceeds would be returned to the property owner, the bill states.

Senate Majority Leader Janae Shamp, who sponsored the bill, said it was developed through what she described as an extensive stakeholder process including county recorders, realtors, home builders and military retirees. Shamp said concerns arose after a reported attempt to lease a warehouse near Luke Air Force Base by an entity she characterized as linked to the Chinese government. She said the bill relies on federal designations of ‘‘designated countries’’ maintained by the federal government and the Director of National Intelligence.

Noah Schramm, policy strategist for the ACLU of Arizona, urged a no vote, arguing the bill’s language could be exploited by an aggressive attorney general and could sweep in people on weak evidence because the bill’s definition of “foreign principal” includes, he said, membership in a political party from a designated country. Michael Lucci, founder of State Armour, testified in favor, describing examples in other states where land purchases near training ranges and bases raised national security concerns and arguing the federal Committee on Foreign Investment in the United States (CFIUS) does not cover so‑called greenfield purchases.

Committee members debated civil‑liberties concerns and potential effects on legitimate foreign investment. Senator Miranda asked whether the bill could lead to racial profiling; Shamp and other supporters said the measure was aimed at national‑security threats and that complaints of unlawful profiling could be litigated. Some members said the bill had been vetted by national‑security advisers; others said the measure had failed in the House the prior session and still needed work.

A motion to give the bill a due‑pass recommendation carried on a 4‑3 vote. Members present recorded 4 ayes, 3 nos; the committee chair announced the do‑pass recommendation to the record.

The bill now heads to the Senate calendar for potential further action.