By Wayne Engle
The Iowa Fertilizer Company, a subsidiary of Orascom Construction Industries, broke ground this past November for construction on a state-of-the art fertilizer plant in Lee County.
The $1.6 billion required to construct the plant is nearly all private money, with no taxpayer liability. The Iowa Fertilizer Company, like many other prudent builders, is utilizing Midwest Disaster Bonds to keep interest costs as low as possible. However, neither the government nor the taxpayers have any liabilities for repayment.
The new plant will create 165 full-time jobs paying approximately $26 per hour plus benefits. In lieu of property taxes, the owner will pay Lee County approximately $1 million per year over the next 20 years for use as the county sees fit.
During the construction period, thousands of construction workers will be employed at prevailing wage scales. Contractors and subcontractors will receive millions of dollars in construction contracts, some of which have already been awarded. The benefits to Lee County will be significant; homebuyers, homebuilding, automobiles and transformation of the area will create opportunities for support companies of all types.
Remember Eddyville before Cargill?
However, there are those who attempt to demean the reputation of Orascom Construction Industries by referring to aged and irrelevant legal incidents. All I know is that Bill Gates, after having done his due diligence, has led a group of investors that put $1 billion in Orascom Construction Industries. That’s good enough for me.
We have all heard the recent rhetoric about how “Iowa paid too much,” or “we could have gotten the deal for much less.” It is sad to see so many people getting lost in these side arguments. The important topic is that the Iowa corporate tax rate is around 8 percent to 12 percent. Our competing states, Illinois and South Dakota have 3 percent and 0 percent corporate income tax respectively. The impact of those tax rates is real, and Iowa is not easily chosen over competitors for that reason.
Did we pay too much for the Iowa Fertilizer Company? Ask the 2,500 construction workers as they cash their paychecks. Ask the 165 full-time, well-paid permanent employees. Ask the Lee County supervisors as they plan with approximately $1 million to invest annually in education, transportation and other benefits.
Remember, the $200 million Iowa investment is not a handout. The delivery of that money is based on performance and job creation. I believe our Iowa team flat outfoxed the competition. As Iowans, let’s celebrate the win!
Wayne Engle, of Marion, retired, is the former CEO of The ESCO Group, Marion. Comments: email@example.com