Corporate Farm Ban Struck Down By Federal Court

Initiative 300

Nebraska’s ban on corporate farming, enacted in the name of the family farm, was struck down Thursday in the name of the U.S. Constitution.

A federal judge said the ban, written into the state constitution by voters in 1982, interfered with interstate commerce and violated the federal Americans with Disabilities Act.

Attorney General Jon Bruning promised to appeal the decision by U.S. District Judge Laurie Smith-Camp. The appeal will allow the ban, commonly known as Initiative 300, to remain in effect until the case winds his way through the judicial system.

Defenders of the ban said its elimination would encourage big agribusiness operations and eventually make it harder for smaller farms to survive.

Opponents said it would actually be easier for family farms and other comparatively small operations to survive if the provision were erased from the state constitution.

The striking down of the amendment was guaranteed to become an issue in the 2006 governor’s race. Incumbent Governor Dave Heineman is challenged for the GOP nomination by 3^rd District Congressman Tom Osborne and Omaha businessman Dave Nabity. Lincoln businessman and attorney David Hahn is the lone candidate for the Democratic nomination. In the 1980s, Hahn previously said, he represented numerous farmers who faced foreclosures.

Initiative 300 reached the ballot after the Legislature was unable to agree on a proposal to restrict corporate farming and ranching operations. The provision enacted by voters makes a variety of exceptions that allow for family corporations to operate.

During the economic crisis that plagued farmers in the early 1980s, popular sentiment was rallied to what was perceived as an effort to “save the family farm,” and to fend off faceless business operations, including those from outside the state.

Production costs were being fueled by runaway inflation, spiraling interest rates and inadequate crop prices. Federal farm policies, enacted early in the administration of President Ronald Reagan, helped to stem inflation. However, changes in policies for federally insured loans and other programs were blamed for contributing to the economic problems of smaller farm operations.

As farm foreclosures became common, concerns about the advent of large-scale corporate farming became a nationwide issue.

It was the specter of small farms losing economic viability that added to fears that big corporate operations would buy large quantifies of land at comparatively low prices. Larger operations would enjoy economies of scale, including investments in equipment designed for farming huge areas while requiring fewer people to do the job.

During the campaign to put the amendment on the ballot, proponents cited the land-buying trend by corporations, including insurance companies. Small towns would dry up in the face of mega-farms that would need fewer services and fewer people to operate, they said.

Debate continued after Initiative 300 was enacted, centering on whether it was properly enforced by the state Department of Justice, and whether its overall impact was good or bad for the state’s economy in general.

News accounts of the Smith-Camp decision and reaction to it:

Lincoln Journal-Star.

Associated Press.

Omaha World-Herald.

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