Biden administration wants reviews of foreign purchases around Michigan military bases

Real estate transactions by foreign entities within a mile of the Detroit Arsenal or within 100 miles of Camp Grayling ? including a proposed vehicle battery plant by Gotion Inc. in Big Rapids that has raised concerns of Chinese infiltration ? will now be subject to potential scrutiny by government officials under a final rule issued Friday.

A senior Treasury Department official confirmed for the Free Press on Friday that the rule expanding the authority of the Committee on Foreign Investment in the United States (CFIUS) was set to be finalized, meaning it would go into effect in a month's time, and bring under its scope the Detroit Arsenal in Warren and Camp Grayling, located in the northern Lower Peninsula and the largest National Guard training facility in the U.S.

Gotion, an American firm whose parent company is based in China and appears to have ties with the Chinese Communist Party, is building an electric vehicle battery plant about 60 miles away from Camp Grayling and Republican critics and local opponents of the project and the state backing it has received have characterized it as a security risk. Some Democrats, U.S. Rep. Elissa Slotkin, D-Holly, among them, have also called for more scrutiny of the Gotion plans but CFIUS previously said that under its current rule it didn't have the authority to review it.

In July, the Treasury Department, which serves as CFIUS chair, issued a new rule to expand its authority in coordination with the Defense Department to cover real estate transactions in proximity to more than 60 military bases in 30 states. CFIUS has the power, if it determines there is a national security risk, to put restrictions and conditions in place for proposed deals or recommend the White House block or reverse them.

When the proposal to expand CFIUS' scope was announced in July, U.S. Rep. John Moolenaar, R-Caledonia, who serves as chairman of the House committee investigating Chinese competition with the U.S., said, once finalized, Treasury's "first move... should be to deny the land purchase by (Chinese Communist Party)-backed firm Gotion, which is within 100 miles of the newly added Camp Grayling. This is also another sign that state and local leaders should withdraw their support for Gotion as well."

Moolenaar, however, also argued that the rule still leaves the door open to firms with connections to foreign adversaries to purchase U.S. properties without mandatory national security vetting. "Congress needs to close this gaping loophole to protect American national security," he said at the time.

In announcing the final rule on Friday, Treasury Secretary Janet Yellen said it "will significantly increase the ability of CFIUS to thoroughly review real estate transactions near bases and will allow us to deter and stop foreign adversaries from threatening our Armed Forces, including through intelligence gathering.”

Contact Todd Spangler: [email protected]. Follow him on Twitter@tsspangler.

This article originally appeared on Detroit Free Press: New rule: Foreign purchases around Michigan military bases need review