USDA’s Collection of Foreign Investment Data Is Flawed, GAO Says

USDA needs to improve how it collects, tracks and shares information on foreign investment in U.S. farmland, the Government Accountability Office wrote in a report released on Jan. 18.

The Agricultural Foreign Investment Disclosure Act of 1978 (AFIDA) requires foreign buyers of U.S. farmland to report their transactions to USDA. The department estimates that such investments grew to about 40 million acres in 2021, up 40% from 2016.

However, GAO questioned the reliability of USDA’s information. The department uses paper forms to collect the data at field offices and headquarters, and its instructions for ensuring the information is accurate and complete are “limited,” the report says. A GAO review found errors in the data, such as the largest China-related land holding being counted twice.

Non-compliance with AFIDA's filing requirement also is a problem. The department has begun using data mining to identify non-filers, “but without improving its internal processes, USDA cannot report reliable information to Congress or the public about where and how much U.S. agricultural land is held by foreign persons,” the GAO wrote.

USDA publishes its foreign investment information annually so that the Department of Defense and other agencies can review it for national security risks, but DOD said it needs more frequent updates and more specific information. The Consolidated Appropriations Act of 2023 requires USDA to adopt an online submission process and public database by the end of 2025, but the department does not expect to meet that deadline, partly because it has not received the necessary funding, the GAO said.

In response to a draft of the GAO report, USDA wrote that it's taking several steps to improve its processes, including updating the handbook that contains foreign investment reporting instructions. The department also said it has told Congress multiple times over the past year that it urgently needs funding to create an online submission system.

The GAO noted that members of Congress have expressed concern about foreign investment in U.S. farmland, such as purchases near military bases that could enable espionage, or transactions that could lead to foreign control of U.S. food supply chains. Lawmakers have also questioned USDA’s ability to track such transactions, especially those that are not reported to the department (see 2401160079).