A federal judge in Iowa has ruled against a landholding company that sought to dismantle a long-standing wetlands law called Swampbuster. Starting in 1985, the Farm Bill put conditions on the receipt of federal subsidies: farmers must not drain wetlands (“Swampbuster”) or plant crops on highly erodible land (“Sodbuster”) if they want to receive the subsidies. Chief Judge C.J. Williams in the Northern District of Iowa dismissed CTM Holdings’ claims, saying Swampbuster falls within the spending power of Congress. Congress can attach conditions to federal funds “in pursuit of the general welfare and may require a recipient’s compliance with conditions to receive the funding."

SWCS/IDALS Photo by Lynn Betts

The lawsuit arose when CTM Holdings sought to farm a 9-acre portion of property that had previously been designated a wetland. The company, which rents the property to farmers, alleged in the complaint that the USDA “unconstitutionally” conditions its farm benefits through Swampbuster. The company also argued that the wetlands in question were dry, but the federal agency would not remove the wetland designation.

Under the Farm Bill conservation provision, the U.S. Department of Agriculture can withhold federal subsidies, like crop insurance and disaster payments, from farmers who clear, drain or convert designated wetlands. CTM Holdings, a company that owns around 800 acres in Iowa, argued that the Swampbuster law unconstitutionally restricts what farmers can do with their property.

Liberty Justice Center, one of the law firms representing CTM Holdings, said in an X post that it will appeal the decision to the Eighth Circuit Court of Appeals.