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Committee advances bill creating process for property held by foreign governments
Summary
The committee advanced Senate Bill 1149, which would allow the attorney general to investigate and seek receivership over land owned by foreign governments in violation of existing Idaho law; title-industry witnesses explained how the bill would provide a remedy and addressed concerns about lien holders and closing requirements.
The House State Affairs Committee voted to send Senate Bill 1149 to the floor with a due pass recommendation after hearing sponsor remarks and testimony from the title industry.
Representing sponsor Judy Boyle, the presenter told the committee the bill seeks to fill a gap in state law by establishing a process when a foreign government owns Idaho property in violation of the existing statute that bars foreign-government ownership of agricultural land, forest land, water rights or mineral rights.
Bob Rice, president of the Idaho Land Title Association, testified that title companies and closing agents have struggled with what to do when ownership involves a foreign government layered through multiple entities. "This bill, in our mind gives a remedy for a foreign government, if a foreign government does come into ownership, and it also takes the onus off the real estate agents, the seller and the title companies to make the determination as to who is behind the entity that is purchasing the property," Rice said.
Under the draft bill discussed in committee, the attorney general would be allowed to investigate a complaint and petition a court for a receivership so the state could seize and sell the property. The draft also describes how sale proceeds would be distributed; Rice said proceeds would be paid to lienholders in order of priority and that, in a hypothetical case where sale proceeds were insufficient, some lienholders could receive less than their recorded lien amounts.
Representative Barbieri asked whether claims or ownership would be invalidated by a violation; Rice said the bill’s language was intended to protect downstream owners by preventing past foreign ownership from disrupting current title where later buyers acquired property in good faith.
Committee members also asked about mechanics: Representative Crane asked whether the attorney general’s office would require a specific complaint form or an online portal; Rice replied he did not know of a standardized form and that a complaint would generally be any written complaint submitted to the Attorney General's office. Representative Holtzclaw asked about closing requirements; Rice said an entity must be validly created and would typically provide corporate formation documents and, if foreign, be registered as a foreign entity in Idaho.
Representative Mickelson moved that the committee send the bill to the floor with a due pass recommendation; the motion passed by voice vote.
The committee’s discussion closed with no negative testimony recorded; the bill will go next to the House calendar for further consideration.
