Bandwidth Pool was awarded a $100,000 grant from the Iowa Economic Development Authority's Demonstration Fund. Ben Anderson is the founder. (Liz Martin/The Gazette)

A Cedar Rapids technology start-up company on Friday was awarded a $100,000 grant from the Iowa Economic Development Authority’s Demonstration Fund.

Bandwidth Pool was formally launched this year when founder Ben Anderson, who previously co-founded Iowa-based  X-Wires, was dealing with a poor Internet provider selection he had made years ago. Anderson learned there is an unmet need for businesses to have greater visibility of their Internet provider choices and reputations before entering into a contract.

Bandwidth Pool plans to solve the problem for businesses across the United States by uncovering ‘hidden’ Internet providers and giving users more selection. The $100,000 grant will be used by the company to continue development of the company’s website and move the site into full production.

The Iowa Economic Development Authority Board also approved tax credit assistance for Blackhawk Engineering of Cedar Falls through the state’s High Quality Jobs Program to expand its manufacturing operations by adding another production line.

Blackhawk Engineering, which creates drivetrain-related products used by companies like Deere and Caterpillar, will invest $3.5 million to increase the number and variety of components produced at its plant. The project is expected to create 16 jobs, including four resulting from the state’s incentives.

An estimated 77,800 Iowans were unemployed in April, down from 80,500 in March. Both figures represent a sharp decline from the 86,200 jobless in April 2012.

The total number of working Iowans increased for the seventh consecutive month to 1,570,900 in April, climbing from 1,562,100 in March. The level stood at 1,557,900 in April 2012.

Total non-farm employment was 1,518,000 in April, unchanged from March. Monthly gains in manufacturing and several of the service industries were offset by losses in construction and government.

Teresa Wahlert, director of Iowa Workforce Development, said the state’s unemployment rate in April was the lowest since December 2008.

“The statewide labor force also grew, a sign that individuals are feeling more confident about the job market,” Wahlert said.

Education and health services gained 1,700 jobs in April, the most of any sector. Health services contributed most of the gain with 1,400 jobs. Financial services added 1,600 jobs, bringing the sector’s employment to an all-time high of 104,300.

Trade and transportation increased by 1,400, reversing a two-month slide. Retail trade was responsible for the majority of the gains with 800 jobs, although both wholesale trade and transportation also were positive.

On the flip side, construction lost the most jobs for the second straight month with a decline of 2,500. Government pared a total of 1,700 jobs, but many of the losses stemmed from an early shedding of seasonal workers as opposed to budget issues.

Professional and business services also experienced its second consecutive monthly loss with a drop of 1,300 jobs, following a strong start to the new year.

Iowa tied with Utah for the fifth-lowest unemployment rate in the country last month. North Dakota at 3.3 percent had the lowest jobless rate and Nevada at 9.6 percent had the highest rate.

The oil and gas boom that arising from hydraulic fracturing is primarily responsible for North Dakota’s low unemployment rate. Nevada’s rate is substantially lower than the 14 percent high it recorded in September 2010.

The dollar value of Iowa farmland rose 3 percent from Jan. 1 through April 1, 2013, easing down from the 8 percent jump on the final quarter of 2012. (The Gazette)

A survey of farmland values from Federal Reserve Bank of Chicago shows the dollar value of “good” Iowa farmland rose 20 percent in the year preceding April 1, but the rate of increase began to moderate in the most recent quarter.

The dollar value of Iowa farmland rose 3 percent from Jan. 1 through April 1, 2013, easing down from the 8 percent jump on the final quarter of 2012.

But the year-over-year increase matched the 20 percent recorded from Jan. 1, 2012, through Jan. 1, 2013.

Across the entire five-state Seventh Federal Reserve District, the dollar value of farmland rose 4 percent in the first quarter of this year and 15 percent year over year, also matching the increase recorded from Jan. 1, 2012, to Jan. 1, 2013. Along with Iowa, the district includes Illinois, Indiana, Michigan and Wisconsin.

Michigan recorded the largest quarterly increase of 12 percent and the largest year-over-year jump of 24 percent.

David Opedahl, Chicago Fed business economist, said demand to purchase agricultural land increased in the final quarter of 2012 and the first quarter compared with the same period a year ago.

“Similarly, the number of farms sold, the amount of acreage sold, and the amount of farmland for sale rose during the winter and early spring of 2013 compared with a year ago,” Opedahl said. “Farmland cash rental rates in the district were 11 percent higher in 2013 compared with 2012.”

Opedahl said the rising cash rental rates and farmland values reflected higher crop prices. Prices in the first quarter of this year averaged $7.06 per bushel for corn and $14.47 per bushel for soybeans, according to the U.S. Department of Agriculture.

The survey of banks in the five-state region found agricultural credit conditions improved in the first quarter of 2013 compared with the same period of 2012.  Sixty-one percent of the survey respondents reported  their banks had more funds available to lend and under 1 percent reporting their banks had less.

Opedahl said the cool, wet weather that has delayed the planting of corn and soybeans has virtually eliminated the drought condition that sharply reduced yields in the fall harvest. He noted that the USDA recently an easing of tight crop stocks because of the anticipated record harvests of corn and soybeans in the fall.

“Lower crop prices could slow the upward trend in farmland values,” Opedahl said. “Many district bankers responding to the survey appeared to share this view.

“For the second quarter of 2013, 19 percent predicted farmland values to increase, while 4 percent expected them to decrease. The vast majority anticipated farmland values to be stable.”

An employee washes a truck in a garage at Gordon Sevig Trucking Company (GSTC) in Walford. (The Gazette)

A Walford company will construct and operate a 600,000-square-foot warehouse and distribution center for Kent Corp. in Muscatine.

GSTC Logistics will hire 29 to 35 people to staff the new facility when it is completed and fully operational by January 2014. It will serve as the distribution center for products made by three Kent Corp. subsidiaries — GPC, Kent Nutrition Group and Kent Pet Group.

Kent Corp. said construction of the distribution center is expected to begin within the new few weeks. The company said materials and labor for construction of the facility will come from area businesses.

“The new warehouse will provide us a food-grade facility to meet our customer requirements,” said Kevin Fields, executive vice president of enterprise services for Kent Corp. “This distribution center also will have a state-of-the-art warehouse management system.”

Kent Corp. is a privately owned company with approximately 1,800 employees involved in the manufacture of animal feeds and pet food.

GSTC Logistics is a division of Gordon Sevig Trucking Co. (GSTC), 400 Highway 151 E. in Walford. Founded in 1994, GSTC Logistics is a family owned and operated third-party logistics company with more than 735,000 square feet of warehouse space.

The United Fire & Casualty Company building in downtown Cedar Rapids. (Brian Ray/The Gazette)

United Fire Group is focusing on growing its business with additional agents in underrepresented markets and on new products, redirecting excess capital from its common stock repurchase program.

Randy Ramlo, president and CEO of the property-and-casualty and life insurer, told shareholders at the Cedar Rapids company’s annual meeting on Wednesday that organic growth is needed to offset a fairly flat investment environment.

“Insurance companies make a good bit of their income based on investment yield and unfortunately over the last few years it’s been trickling down,” Ramlo said. “We have to make more of our profits from the generating side, rather than relying on our investments.

“We had overall organic growth of 12.5 percent in 2012. Rate increases accounted for 6 percent of that growth, new business made up about 3.5 percent and 3 percent was based on exposure changes.”

Ramlo said payrolls and sales at many companies insured by United Fire were declining in recent years due to the economic recession, requiring United Fire Group to refund part of a premium. He said payrolls and sales have begun rising again, increasing premiums.

Ramlo said a property-and-casualty insurance product aimed at small business customers is just about ready for the market. Agents will be able to quote the annual premium to a prospective policyholder, rather than having to wait for a decision from United Fire Group’s underwriters.

“We’re also looking at writing workman’s compensation policies, particularly for larger accounts that require a little more expertise and have less competition,” Ramlo said.

“Agents really value having a company in their stable that can handle the more complicated accounts with products liability and large fire lines.

“We like to be a market for those things so we can leverage them to write some more of what we call ‘main street’  business, that’s really more innocuous and has a lower premium. Workers compensation coverage will be offered in addition to a company’s normal property and casualty package.”

Ramlo said United Fire is adding agents in markets such as St. Louis, where it only had two agents representing the company. He said the company’s United Life Insurance unit has added eight states with the acquisition of Mercer Insurance Group and will continue to look for additional opportunities to write more policies.

With regard to the Mercer acquisition, Ramlo said United Fire has repaid $45 million of debt used as part of the purchase of the New Jersey-based insurer.

United Fire’s board of directors on Wednesday voted to raise the company’s quarterly dividend to 18 cents per common share, or 72 cents per share annually. That represents a 20 percent increase from 15 cents per share, or 60 cents per share annually, that has been paid since 2007.

“The board’s actions today reflect what we believe is an appropriate means of addressing shareholder value at this time,” Ramlo said. “We believe that investors will find merit in this significant dividend increase along with our recent stock price appreciation.”

Highway 58 between the intersections of Greenhill Road and Viking Road in Cedar Falls.

The $1.1 billion program, presented Tuesday to the Iowa Transportation Commission in Ames, includes the Mount Vernon/Lisbon bypass and the Highway 100 extension from Edgewood Road NE to Highway 30. Both are multiyear corridor improvement projects that will be funded in phases.

The five-year DOT highway improvement program also includes Highway 30 from Iowa 21 to U.S. 218 in Benton County, the Highway 58 at Viking Road interchange in Cedar Falls and the Highway 218 interchange at County Road C-57 in Black Hawk County.

Separately Tuesday, the transportation commission approved a $274,000 state grant to help create 62 jobs and expand a Clinton business that manufactures concrete, main track and turnout railroad ties.

The Iowa Transportation Commission approved an application from the City of Clinton on behalf of Rail One USA Corp. The Revitalize Iowa’s Sound Economy (RISE) grant will assist with the construction of approximately 525 feet of new roadway to an industrial park.

The project, which represents a $36 million capital investment, will be completed by September.

The commission also approved a $983,000 RISE grant for the City of Pleasant Hill to construct 1,340 feet of new roadway to provide access to 64 acres for industrial, manufacturing, warehouse distribution and professional office purposes. The project is targeted for completion in November.

The former Iowa Department of Transportation district headquarters at 430 16th Ave. SW in Cedar Rapids and 2.15 acres of land will be sold at auction on June 6. The two-story, 7,680-square-foot building was constructed in about 1950 and could be rezoned from public to commercial use. (George C. Ford/The Gazette)

A June 6 auction is set for the sale of a building that formerly housed the Iowa Department of Transportation District 6 office in southwest Cedar Rapids.

Cathy Cutler, DOT area transportation planner, said 21 employees moved out of the two-story, 7,680-square-foot building at 430 16th Ave. SW in November when the office moved to 5455 Kirkwood Blvd. SW. The masonry structure with a brick exterior is located on 2.15 acres of land, which also will be sold.

Constructed in the 1930s, according to Cutler, the structure has two floors as well as a third level for storage and a partial basement. The building has central air conditioning and boiler heat.

There is a paved parking area on north side of building, and access to the building is available from 15th and 16th avenues SW. Although the building and land have been zoned for public use, rezoning for commercial use is possible.

Cutler said employees of the Cedar Rapids Public Works Department are using the parking lot. They were displaced when construction began on the new $36 million City Services Center.

Peoples Co. of Clive, which will conduct the June 6 auction, has set open houses for potential buyer inspection from 3 to 6 p.m., Thursday, May 23, and 1 to 4 p.m., Sunday, May 26.

The sale of the Cedar Rapids building is part of a five-tract auction that also includes state properties in Ankeny and Pleasant Hill.

Fifteen percent of Iowa’s corn acreage has been planted, compared with 86 percent at this time last year and the five-year average of 79 percent. This is the first year since 1993 that less than 20 percent of corn acres were planted by May 12.

Soybean planting was 1 percent compete, well behind last year’s 34 percent and the five-year average of 30 percent. It marks the latest start to soybean planting since 1995.

Oat planting was 81 percent complete; at this time last year oat planting was complete. Forty-five percent of oat acreage has emerged, well behind last year’s 94 percent and the five-year average of 77 percent.

Topsoil moisture levels were rated 1 percent very short, 4 percent short, 68 percent adequate and 27 percent surplus. Subsoil moisture levels were rated 4 percent very short, 20 percent short and 63 percent adequate and 13 percent surplus.

Temperatures for the week as a whole averaged 2.1 degrees below normal. Weekly rain totals varied from only 0.02 inches at Hamburg in far southwest Iowa to 2.58 inches near Jamaica in Guthrie County. The statewide average precipitation was 0.72 inches while normal for the week is 1.00 inches.

A total of 302 homes were sold in April, according to the Cedar Rapids Area Association of Realtors, up 3.6 percent from 291 sold in the same month last year. The average sale price of a Cedar Rapids area home was $167,669 last month, an increase of 3.7 percent from $161,645 in April 2012.

Days on the market continue to decline, dropping from an average 107 days in April 2012 to 91 days last month.

The Iowa City Area Association of Realtors reported 191 homes were sold last month, up 7.3 percent from 178 in April 2012. The average sale price of a home rose 1.6 percent to $187,926 in April from $184,595 in the same month of 2012.

There were 161 pending home sales in the Iowa City-Coralville area on April 30, up from 140 at the end of April 2012.

The Iowa Association of Realtors Housing Trends Report showed home sales climbed 6.1 percent, to 2,851, in April from 2,688 homes sold in the same month of 2012. The average sale price of an Iowa home was $146,885 in April, up 1.4 percent from $144,813 in the same month last year.

Days on the market continued to decrease, dropping 12 days or 10.8 percent from last year. The average number of days on the market in April 2012 was 111 days, while the average last month was 99 days.

The number of homes on the market across the state at the end of last month was 18,331, down 13 percent from April 30, 2012 when the statewide inventory was 21,061 homes.

“Most of the numbers we track continue to show positive movement,” said Don Marple, president of the Iowa Association of Realtors. “We have had 14 continuous months of year-over-year price growth in both the average and median sale prices.

“Although inventory levels did increase slightly in April from the prior month, more homes are still needed on the market to keep up with demand.”

Dennis Munson

Sometimes personal decisions are as important corporate planning in the strategic direction, growth and ultimate success of a company. Ask Dennis Munson.

Faced with making a career move in 1991 to Washington, D.C., Munson chose to give up a $70,000-a-year position with MCI to keep his family in Cedar Rapids.

“My sons were fairly young at the time and I just felt that moving to Washington wasn’t something we wanted to do,” said Munson, president of Linn Star Transfer.

“I bought half of Linn Star Transfer from my brother, Steve, and went to work with him. After five years, I bought the other half of the company.”

Steve Munson had purchased Linn Star Transfer from founder Sebert Cox in 1986, when the company was incorporated to facilitate the sale. Up to that time, Cox had operated the business as a sole proprietor, transporting mail between the Cedar Rapids Main Post Office and rural post offices.

“When my brother bought the company, it had three trucks,” Dennis Munson said. “We hauled mail on the postal ‘star routes,’ which became the basis for the company’s name.

“We picked up mail at the Cedar Rapids post office between 5 and 8 a.m. for delivery to the rural post offices. We brought mail back from the rural post offices in the late afternoon.”

When Sears contacted Linn Star in 1991 about handling delivery and setup of appliances, Munson said using the trucks for deliveries during the mail hauling down time initially appeared to be a logical business decision.

“When it’s 3 o’clock and you still have deliveries to do, but you need the same truck to run mail, something has to give,” Munson recalled.”Ultimately it ended up becoming two separate businesses with different trucks.

Glenn Wallace, with Linn Star Transport, unloads a delivery of kitchen appliances to a home in Marion. (Travis Bartoshek/The Gazette)

“We had to hire different drivers with primarily customer-service skills as well as installation skills. When they’re going into someone’s home, they’re making a dozen first impressions all day long.

“They have to be clean cut, presentable and professional.”

The transportation, warehousing and supply-chain management of goods represents an $8 trillion economic activity worldwide. Logistics in the United States totaled nearly $1.3 trillion last year, according to industry estimates compiled by Armstrong & Associates Inc. of Stoughton, Wis.

“It is a field that touches everything,” said Jeff Zanarini, a managing partner at private equity firm HIG Capital LLC.

The third-party logistics market surpassed $133 billion in the United States in 2011. But it is still relatively in its infancy with only a 10 percent penetration of  only potential business, according to Armstrong & Associates.

When General Electric wanted to switch so called last-mile logistics contractors for its appliances, Linn Star took on the additional business. The company later expanded into furniture delivery and some assembly for Ethan Allen Galleries and Lebeda Mattress.

“At this point, mail delivery is about 5 percent of our revenues,” Munson said. “Appliance and furniture delivery accounts for most of our revenue, with furniture delivery pretty much based in Iowa.”

Munson said 90 percent of Linn Star’s revenue comes from outside the state. A small group of ‘blue chip’ customers have requested Linn Star to grow beyond Iowa.

“In 1996, GE asked us to handle their deliveries in Des Moines when they wanted to switch providers,” Munson said. “In 1998, we entered Nebraska with appliance delivery in the Omaha market.

Linn Star Inc. employee Joe Tamayo of Cedar Rapids unloads a couple of chairs in Cedar Rapids. (The Gazette)

“The big move occurred in 2001 with Minneapolis. That was a large market and a culture change for us.”

In a relatively short period of time, Linn Star expanded into Kansas City, Mo.; Denver, Colo.; St. Louis, Mo.; Wichita, Kan.; Little Rock, Ark., and Tulsa-Springdale, Okla. Another big step occurred when Munson decided to enter the San Francisco market, followed by Detroit and later Eureka in northern California.

Linn Star’s Home Delivery division has up to 180 trucks on the road each day, handling about 6,000 home deliveries each week of household appliances and furniture.

“The business has morphed from all employees to using independent contractors, especially in the larger markets,” Munson said. “The majority of our contractors lease their trucks from a truck-leasing subsidiary of Linn Star Transfer.”

The Cedar Rapids company also recycles the appliances it hauls away after delivering new units, “de-manufacturing” them to eliminate waste going to a landfill. Munson said the decision to handle disassembly in-house grew out of his frustration with a third-party provider.

“I got tired of watching metal scrappers not properly disposing of appliances,” he said. “When we first started handling it, there was an additional cost. Over time, the metal markets have changed, and there’s an actual revenue stream from it.”

Munson and Linn Star faced a major challenge when the company’s office and warehouse was flooded in June 2008.

“We had been operating out of the old Farmstead meatpacking plant,” he said. “In the flood of 1993, we had no water at all.

“We knew we would have access issues, so we planned to move out ahead of the flood crest. We moved our corporate office to our shop behind the Cedar Rapids Police Department and took out some merchandise.”

He recalled the company wound up losing about 300 brand new appliances.

“Some of our employees kept going back in after the water went down to try and salvage some inventory, but it was impossible,” Munson recalled.

“We sustained a loss of about $100,000 for inventory, but it could have been a lot worse.”

On Wednesday, before the June 13, 2008, crest of the Cedar River, Munson had made the decision that Linn Star would never return to the Farmstead property, which was owned by the city.

“We forwarded nine inbound phone lines to two cell phones and that’s how we operated for a month,” he said. “All the dispatching for Denver, Detroit, St. Louis and other cities that we serve is handled from Cedar Rapids, and we never lost a delivery.

“We secured a year’s lease on a building on Sixth Street SW, and that took care of our warehousing needs. On Sunday after the flood (in 2008), I noticed a vacant building off Seventh Street SW and we signed a lease for it as a temporary office without ever setting foot inside.”

Knowing the company would eventually be forced to leave the Farmstead property, Munson had been looking before the June 2008 flood for land to build an office and warehouse facility. The flood and move to very temporary quarters accelerated those plans.

After securing land on Wright Brothers Court SW, Linn Star contracted with Hunter Companies for construction of an office and warehouse. The business occupied the building near The Eastern Iowa Airport in September 2010.

While agreeing that opportunities exist in additional markets, Munson has turned down expansions in Florida and Philadelphia.

“If it makes sense for us and it’s a good fit, we will consider an expansion,” he said. “We are looking for big box stores for future expansions. We’re a Midwest company operating primarily in this part of the country.

“That has served us well over the years.”

Passenger traffic through The Eastern Iowa Airport set another record in April, continuing a trend that began in February. (The Gazzette)

Passenger traffic through The Eastern Iowa Airport set another record in April, continuing a trend that began in February.

A total of 85,676 passengers traveled through the airport in April, eclipsing the previous same-month record of 85,452 travelers set in April 2007. Last month’s total passenger count included a record 42,315 departing travelers.

“This is a testament to the strength of the economy in the corridor,” said Airport Director Tim Bradshaw. “We are tremendously lucky to have such a strong community. Many airports similar to The Eastern Iowa Airport  are not seeing the continued growth that we are in Eastern Iowa.”

A total of 99,664 passengers used the airport in March, beating the previous same-month record of 98,435 passengers in March 2000. There were 48,948 departing travelers in March and 50,716 arriving passengers.

February also produced a record number of travelers with 79,359 passengers, eclipsing the previous same month record of 78,738 passengers in February 2006. There were 40,466 departing travelers in February and 38,893 arriving passengers.

The record passenger travel comes at a time when the airport is completing work with a consultant on a master plan that outlines the direction the airport will be going through the next five to 20 years. The Cedar Rapids Airport Commission is expected to receive the final plan in July for its review and approval.

The plan will reportedly recommend improvements to the 26-year-old passenger terminal, expansion of the ground transportation and rental car parking area, an expanded security check point, and additional gates.

Members of Local 308 of the International Brotherhood of Carpenters and Joiners in America voted Friday to approve a new contract with area general contractors, ending a more than week-long strike. (Brian Ray/The Gazette)

Members of Local 308 of the International Brotherhood of Carpenters and Joiners in America voted Friday to approve a new contract with area general contractors, ending a more than week-long strike.

“Our members just ratified a three-year agreement and we’re going back to work on Monday,” said Dave Hogan, business agent for Local 308.

Hogan declined to provide details of the contract, citing an agreement with the contractors.

Local 308 represents about 425 area carpenters. The strike affected construction projects in Benton, Linn, Jones and Tama counties.

Carpenters reportedly were seeking a 4 percent increase in pay, while the contractors were offering between 2 percent and 2.5 percent. Other craft unions had settled for 2 percent to 2.5 percent.

Local 308 cited the 4 percent increase negotiated by a separate carpenters union local in Iowa City. The contractors countered that Iowa City is a different market with sizable construction projects in the pipeline for the University of Iowa.

Among the Cedar Rapids projects affected by the carpenters strike are the new Cedar Rapids Public Works building, Cedar Rapids Transit office and garage, Cedar Rapids Public Library and the Central Fire Station. The U.S. Cellular Center and Double Tree by Hilton renovation and expansion projects are not affected.

Local contractors cited the winding down of major construction projects in Cedar Rapids and the lack of similar projects in the coming construction season for their decision to offer a 2 percent to 2.5 percent pay increase.

While other construction trades continued to work on projects during the carpenters’ strike, completion often hinged on work that required them. Bathroom remodeling work could be substantially completed, but city inspectors would not sign off until stall partitions were installed by the carpenters.

The USDA said Friday that farmers will produce a record 14.14 billion bushels, which will push corn stockpiles to more than 2 billion bushels at the end of the marketing year in 2014. That would be almost triple the 759 million bushels predicted by the USDA at the end of the current marketing year on Aug. 31.

The USDA is forecasting soybean production at 3.39 billion bushels with end stocks at 265 million bushels. That would be an increase of 140 million bushels from the current marketing year.

The bin-buster crops, if realized, will help replenish dangerously low stockpiles and, in the case of soybeans, allow the United States to regain its position as the world’s largest producer. Due to the effects of last year’s crippling drought, the United States has relinquished the title to Brazil.

Iowa farmers had planted just 8 percent of their corn as of May 5, according to the USDA, down from 62 percent at this time last year and a 5-year average 56 percent. Nationally, just 2 percent of the corn crop had been planted by April 28, the slowest pace since 1984, according to the USDA.

Corn-for-ethanol is expected to increase to 4.85 billion bushels this year, up 250 million bushels from 2012, but down almost 160 million bushels from 2011.

Alliant Energy, which has wind generation capacity to supply electricity to 300,000 homes, does not plan to add any new wind turbines until electric power transmission constraints are resolved. (The Gazette)

Patricia Kampling, Alliant Energy chairwoman, president and CEO, told shareholders attending the company’s annual meeting Thursday in Cedar Rapids that the electric power transmission grid in 13 Midwestern states needs to catch up with the wind farms already in operation.

“We’re working right now to get transmission constraints alleviated at Franklin County, our last wind farm,” Kampling said. “Our wind farms are operating extraordinarily well as we get these transmission constraints relieved.

“We will stop and see what our portfolio looks like at that point.”

Kampling’s comments came a day after MidAmerican Energy announced plans to add 656 wind turbines that will generate up to 1,050 megawatts of power in Iowa by the end of 2015. The $1.9 billion project represents the largest economic development investment in state history.

“MidAmerican Energy has a different generation portfolio than we do,” Kampling said. “We added wind generation back in 2007 and they are adding wind now. We are planning to add natural gas.”

Alliant Energy’s Interstate Power and Light subsidiary is seeking Iowa Utilities Board approval to construct a $700 million, 600-megawatt natural gas-fired combined cycle generation plant in Marshalltown. The utility and the Iowa Office of Consumer Advocate (OCA) recently announced a settlement regarding rate-making principles for the new plant.

Tom Aller, president of IP&L, said the concerns of four other organizations seeking to intervene will be heard by the IUB at a hearing later this month.

“We will continue to have discussions with some of our larger customers and the other organizations such as the Iowa Consumer Coalition,” Aller said. “Whether we get anywhere with them before the hearing is probably problematic.

“I think the agreement with the OCA sent a very clear signal that the proposal we have put forward is in the best interest of all of our customers. It’s one of a few times in my experience that we’ve reach agreement with the OCA on a major project without litigating it.”

Kampling said Alliant Energy and IP&L expect to receive approval from the IUB by the end of the year for the Marshalltown generating station. She said the plant is expected to go online in 2017.

As it prepares for the new generating station, Alliant Energy is moving forward with plans to demolish the former Sixth Street Generating Station in Cedar Rapids that was significantly damaged by the June 2008 flood.

“We have removed all of the asbestos from the plant, which was our first priority,” Kampling said. “Because the plant was more than 100 years old, we’re being very patient with the environmental studies that we’re doing on it.

“We have some consultants working with us to advise what to do next. We can’t take it down very quickly because of the constraints on the property.”

Aller said IP&L has invested $30 million in the construction of two new electric substations near Quaker Oats and the former Farmstead meatpacking plant property in the aftermath of the 2008 flood.

“When we saw what happened to power coming into the community, we worked very closely with ITC Midwest to create a loop system around Cedar Rapids,” Aller said. “If the flood ever happens again, Cedar Rapids is so much better prepared than it was in 2008.”

The strong stock performance in the first quarter of the year, particularly those in the S&P 500 index, created macro hedge program losses that reduced earnings by nearly two-thirds for Aegon. (Jim Slosiarek/The Gazette)

The strong stock performance in the first quarter of the year,  particularly those in the S&P 500 index, created macro hedge program losses that reduced earnings by nearly two-thirds for Aegon.

The Netherlands-based corporate parent of Transamerica in Cedar Rapids recorded net income of $268.8 million in the quarter that ended on March 31, down 61 percent from $691.8 million in the first quarter of 2012.

“The sharp rise in equity markets resulted in a loss on our equity hedging programs, which impacted net income,” said Alex Wynaendts, AEGON chief executive officer. “These hedging programs have been put in place to protect our capital position, in line with our strategy to reduce Aegon’s exposure to financial market risk.”

As the macro hedges are carried at fair value versus the fee revenue emerging over time, the strong equity performance in the first quarter created a $376.9 million loss that will be offset over time by higher earnings from higher stock values.

A Reuters poll of five analysts forecast a consensus net profit of $433.5 million.

Aegon’s quarterly underlying earnings before taxes, which assume a certain return on investments, rose 1 percent to $586.4 million, in line with analysts’ forecasts.

The United Fire & Casualty Company building in Downtown Cedar Rapids. (Brian Ray/The Gazette)

Higher first-quarter earnings and revenue were reported Tuesday by United Fire Group, a Cedar Rapids-based property and casualty and life insurance company.

United Fire reported net income of $22.4 million, or 88 cents per share, for the quarter that ended on March 31, up 16.7 percent from $19.2 million, or 75 cents per share, for the same period in 2012. First-quarter revenue was $205.3 million, a 6 percent improvement from $193.7 million in the first quarter of 2012.

United Fire President and CEO Randy Ramlo said the first quarter was solid in terms of more than just higher earnings and revenue.

“We continue to seek and receive rate increases in most lines of business, policy retention remains strong and within our comfort range, and we are seeing a fair amount of new business opportunities,” Ramlo said. “The market as a whole continues to firm due to weather-related losses in the past few years and the continuing low investment rate environment.

“We believe these economic and market trends will continue throughout 2013.”

Consolidated net unrealized investment gains, net of tax, totaled $152.7 million as of March 31, an increase of $8.6 million or 6.0 percent from Dec. 31, 2012. The increase in unrealized gains was driven by an increase in the fair value of the equity portfolios.

“We continue to see signs of improvement in the investment environment as evidenced by our equity portfolios,” Ramlo said. “Our equity portfolio return was 11.4 percent for the quarter, compared with the S&P 500 return of 10.6 percent for the quarter. However, equities are only approximately 6 percent of our total investment portfolio.”

United Fire experienced a decline in first-quarter catastrophic losses to $4.5 million, or 12 cents per share after tax, for the three-month period that ended on March 31, compared with $14.1 million, or 36 cents per share after tax, for the same period in 2012.

“Over the last decade or so, our first-quarter catastrophic losses averaged about 2.9 percentage points of the combined ratio,” Ramlo said. “First-quarter 2012 catastrophic losses included losses associated with the Branson, Mo., EF5 tornado and therefore, was well beyond the norm.”

Eight percent of Iowa’s corn crop has been planted, compared with 62 percent at this point in 2012 and the five-year average of 56 percent. Although some farmers were able to plant corn early last week before the weather turned, Iowa Secretary of Agriculture Bill Northey said the last time corn planting was this far behind was 1995.

“We will need several days of dry weather and warmer temperatures so fields can dry out before farmers can get going again,” Northey said. “Everyone is anxious to get their corn planted. Fortunately farmers can make rapid progress when conditions allow.”

(Nikole Hanna/The Gazette)

There was an average of 2.3 days suitable for fieldwork during the week that ended Sunday. Field activities included application of fertilizers and herbicides, tilling and planting.

Last week was the third of the past four with unusually heavy precipitation across the state. Temperature extremes varied from 26 degrees at Sibley on Friday to 89 degrees at Cedar Rapids, Iowa City and Stanley on Tuesday.

Topsoil moisture levels were rated 1 percent very short, 3 percent short, 59 percent adequate and 37 percent surplus.

The precipitation received during the week continued to improve subsoil moisture levels. Subsoil moisture levels were rated 4 percent very short, 24 percent short and 63 percent adequate and 9 percent surplus.

Oat planting is 67 percent complete, compared with 100 percent at this time last year. Twenty-three percent of oat acreage has emerged, well behind last year’s 88 percent and the five-year average of 62 percent.

Pasture and range condition rated 10 percent very poor, 20 percent poor, 39 percent fair and 27 percent good and 4 percent excellent. Enough moisture has been received to promote new growth in pastures, but cooler than average temperatures have limited the growth of grass.

Hay continues to command higher-than-normal prices at weekly auctions in Dyersville and Fort Atkinson.

The top sale price at the Fort Atkinson Hay Auction on Wednesday was $400 per ton for fourth and fifth crop big square bales. About 25 percent of the hay was sold for more than $300 per ton.

The overall sale average at Fort Atkinson was down about $35 per ton, primarily due to lower quality loads offered at the auction.

At Dyersville Sales, the top sale price was $340 per ton on large square bales and $315 per ton on large round bales. Overall demand was good.

The Madison, Wis.-based utility holding company posted net income of  $76.3 million, or 72 cents per share, for the quarter that ended on March 31, up 52.3 percent from $50.1 million, or 50 cents per share, in the first quarter of 2012. Analysts were expecting a profit of 61 cents per share.

Alliant recorded first-quarter revenue of $859.6 million, up 12.3 percent from $765.7 million in the same quarter of 2012. Analysts forecast revenue of $765.4 million.

The company attributed the higher first-quarter results to a number of factors, including cooler weather that had a positive impact on electric and sales and higher income from Interstate Power’s tax benefit riders. The latter use income tax benefits from certain tax initiatives to provide retail electric and gas customers in Iowa credits on their electric bills.

Alliant will hold its annual shareholders meeting Thursday at the Cedar Rapids Marriott.

The Alcoa Business Services Center in Pittsburgh, Pennsylvania. (REUTERS/Jason Cohn/Files)

Alcoa on Friday announced a second expansion of its automotive sheet manufacturing capacity as it moves toward completion later this year of a $300 million expansion of its plant in the Quad Cities.

Alcoa will invest $275 million over the next three years to expand and convert capacity at its rolling mill in Alcoa, Tenn., to manufacture aluminum sheet to support automotive producers’ plans to increase fuel efficiency, safety, durability and performance of cars and light trucks.

The Tennessee plant expansion will add 200 full-time workers when construction is completed in mid-2015. The project will convert some of the plant’s can sheet capacity to high-strength automotive aluminum capacity, as well as install incremental automotive capacity.

In 2011, Pittsburgh-based Alcoa was awarded a $3 million state incentive by the Iowa Economic Development Authority to pave the way for a $300 million expansion of its plant in Riverdale. The expansion has created 150 construction jobs and will add another 150 permanent factory jobs.

The Alcoa plant in Riversdale, near Bettendorf, employs about 2,100 workers. It produces advanced products for all major aircraft, including the Airbus A380, the world’s largest passenger plane, and Boeing’s 747-8 and 777.

In addition to aerospace, the Alcoa plant in Riverdale produces armor products for the U.S. military, including the Humvee and the MRAP or Mine-Resistant, Ambush-Protected vehicle.

With the orders, Acciona Windpower has finalized agreements that bring the total use of the AW3000 wind turbines to generate more than 1 gigawatt of electricity.

In addition to projects operating AW3000 turbines in the United States and Spain, Acciona Windpower’s footprint for the AW3000 will extend to Canada, Mexico, Brazil, Poland and South Africa.

With the orders, Acciona Windpower has finalized agreements that bring the total use of the AW3000 wind turbines to generate more than 1 gigawatt of electricity. (Cliff Jette/The Gazette)

All 1 gigawatt of new wind turbine orders are expected to be in operation by the end of 2015. The company, a subsidiary of Acciona Energy of Spain, is still taking additional orders for delivery in 2014 and future years.

“Acciona Windpower is gaining momentum in the market by focusing on technological innovations that lower the cost of energy and give our customers’ projects a competitive edge,” said Jose Luis Blanco, chief executive officer of Acciona Windpower. “The growing order book and performance of AW3000 turbines is attracting interest from customers worldwide.”

Over half the orders specify Acciona Windpower’s 120-meter concrete tower, which allows for cost-effective capture of more wind energy at taller heights. The concrete towers also can be built on-site, which increases the local content of a project.

Acciona Windpower has two assembly plants in Spain along with its North American plant in West Branch. It also has a  turbine blade manufacturing facility  in Spain.

Since 2004 Acciona Windpower has manufactured wind turbines for more than 4,000 megawatts of wind generation  installed or contracted in 17 countries.

In December 2011, the Cedar Rapids Airport Commission approved seeking expansion of the foreign trade zone from 2,000 acres to 28 counties by reorganizing under the federal Alternative Site Framework program. Similar expansions have been approved in other states.

Airport Director Tim Bradshaw said the Commerce Department’s Foreign-Trade Zone Board reviewed the application for reorganization and objected to including Johnson County and some other Eastern Iowa counties.

“The Foreign-Trade Zone Board felt they were being served by the Quad Cities foreign trade zone,” Bradshaw said. “The Quad Cities foreign trade zone also had filed to reorganize and wanted to include those counties under their new structure.

“The board said we needed to prove that what it calls the ‘convenience of commerce’ is not being met by the Quad Cities foreign trade zone. The same thing was true to our west where the Des Moines foreign trade zone serves them.

“Des Moines and the Quad Cities have an advantage over us because they are actually U.S. Customs ports of entry. They have officials there to check things.”

Bradshaw said The Eastern Iowa Airport foreign trade zone is served by the Quad Cities and Des Moines ports of entry. He said the revised application for reorganization makes the case that the counties can be included in multiple foreign trade zones.

“We’ve shown them other areas of the country like Miami, Fla., where counties are served by dual foreign trade zones,” Bradshaw said. “We’ve hired a consultant to help us overcome the ‘convenience of commerce’ clause and we’re moving forward in our desire to expand our zone.”

If reorganization ultimately is approved, it would enable any manufacturing or distribution business in the Eastern Iowa counties included in the expanded zone to reduce global supply chain costs. It would dramatically shorten the process for new companies to secure foreign trade zone status for warehousing and distribution operations, and for existing companies in the zone to expand.

The new process would take approximately 30 days from date of application. Under the existing framework, the process takes as much as a year.

Deere & Co. in Waterloo has a 1,400-acre sub-zone of The Eastern Iowa Airport foreign trade zone that saves the company as much as $2.5 million annually.

In addition to delay or elimination of duty payments, Deere also realizes savings from zone-to-zone transfers and cash flow savings on customs duties while products destined for the U.S. market are in production.

ADM, Archer Daniels Midland, corn processing plant in SW Cedar Rapids. (The Gazette)

first-quarter earnings as the company’s agricultural services unit was affected by the ongoing effects of last summer’s drought.

The Decatur, Ill., agribusiness giant posted net earnings $269 million, or 41 cents per share, for the quarter that ended on March 31, down from $399 million, or 60 cents per share, in the same quarter of 2012. Sales increased to $21.7 billion in the first quarter from $21.2 billion in the comparable period last year.

ADM said oilseeds processing profit declined $229 million due to significantly lower results from cocoa caused by industry margin pressures and weaker South American origination results. Corn Processing profit increased $20 million due to improved ethanol results.

Sweeteners and starches results were negatively impacted by a $44 million pretax charge from corn hedge timing effects, and agricultural services profit decreased $110 million as U.S. origination volumes declined.

ADM Chairwoman and CEO Patricia Woertz said the company worked its way through a “challenging” quarter.

“In oilseeds, our earnings were reduced by challenges in Brazil and depressed margins in cocoa,” Woertz said. “Our ethanol business improved as declining inventories supported overall industry margins, and we began to see positive results from the actions we’ve been taking to improve the profitability of that business.”

ADM produces corn-based sweeteners and ethanol at its Cedar Rapids facilities. The company has more than 265 processing plant and 460 crop purchasing facilities worldwide.

Miron Construction employees Kevin Jones of Cedar Rapids (center), Bob Dunn of North Liberty (right), and Ethan Smith of North Liberty (left) picket in front of the new Cedar Rapids central fire station as part of the Local 308 of the United Brotherhood of Carpenters & Joiners of America. (Brian Ray/The Gazette)

No new contract negotiations have been held to craft a new contract and settle a strike by members of Local 308 of the United Brotherhood of Carpenters and Joiners of America in Cedar Rapids.

“We left the ball in the contractors’ court to decide if they want to sit down and talk,” said Dave Hogan, business agent for Local 308. “We’ve told them that we’re open anytime today, over the weekend, or next week. All they have to do is call us and we have not heard from them.”

Hogan said the contractors are offering the union a one-year contract. Members of Local 308 voted Tuesday afternoon to reject the latest offer and went on strike at midnight when the previous contract expired.

Local 308 of the United Brotherhood of Carpenters and Joiners of America has 425 members. The strike is affecting construction projects in Linn, Benton, Jones and Tama counties, where picket lines were set up Wednesday.

Hogan declined to specify what contract issues are in dispute.

There are 15 building trades unions in the Cedar Rapids-Iowa City area. Hogan, who also serves as president of the Cedar Rapids-Iowa City Building Trades Council, said two unions are working under contract extensions, others are continuing to negotiate and still others have reached new agreements.

Hogan said many of the building trades contracts expire on May 1. The new contracts’ length varies by trade.

Ligon Industries of Birmingham, Ala., founded in 1999, owns 13 other manufacturing companies, seven of which are in the fluid power industry. Terms of the transaction were not disclosed.

Energy Manufacturing, founded in 1944, employs 167 people and has more than 115,000 square feet of manufacturing space in Monticello. The company’s main customers are North American and Latin American original equipment manufacturers producing a wide range of equipment and machinery.

Ken Rosenbecker, vice president of sales and marketing at Energy Manufacturing, said the company is pleased and excited to be acquired by Ligon Industries.

“Ligon has a wealth of experience in the fluid power industry and is well positioned to provide Energy with guidance and support,” Rosenbecker said. “Ligon also has a long-term business perspective, and a history of appropriate and timely investment within its companies.”

Rosenbecker added that the change of ownership will not affect the relationship Energy Manufacturing has with its customers and suppliers.

“Ligon has a long track record of a very de-centralized management style regarding the companies it holds. To our customers and suppliers, this change will be virtually transparent,” Rosenbecker said.

Dave Hogan, business agent of Local 308, said the members voted to strike at midnight Tuesday. Hogan said pickets will be set up at construction sites on Wednesday morning.

The union has 425 members and the strike will affect construction projects in Linn, Benton, Jones and Tama counties.

Hogan said the union is willing to meet with representatives of the general contractors to renew negotiations.

In May 2011, Local 308 members continued to work without a contract as negotiations continued. The carpenters union was the only one of seven local construction trades that was unable to reach a new contract with contractors.

The strike by carpenters union members is likely to affect a number of major construction sites in the four-county areas as well as smaller expansion or remodeling projects.

Construction projects tied to recovery from the June 2008 flood in Cedar Rapids have kept local building trades members working despite a nationwide construction slowdown due to the  economic recession.

The Dubuque-based bank holding company reported net income of $12.6 million, or 70 cents per diluted common share, for the quarter that ended on March 31, compared with $12.8 million, or 71 cents per diluted common share, for the first quarter of 2012.

Return on average common equity was 15.18 percent for the first quarter of 2013, compared with 17.27 percent for the comparable period last year. Return on average assets was 1 percent in the most recent quarter, compared with 1.12 percent for the same quarter in 2012.

Earnings for the first quarter of 2013 were positively affected by a lower provision for loan and lease losses, an increase in loan servicing income and gains on sale of loans attributable to the continued expansion of Heartland Financial’s mortgage operations, and a reduction in net losses on repossessed assets.

The first quarter of 2012 included $2 million in equity earnings from the sale of two low-income housing projects within partnerships involving Dubuque Bank and Trust.

The absence of comparable non-interest income during the first quarter of 2013, combined with a significant increase in salaries and employee benefits, offset the positive quarterly improvements.

Net interest margin, calculated as a percentage of average earning assets, was 3.77 percent during the first quarter of 2013, compared with 4.23 percent during the first quarter of 2012 and 3.81 percent during the fourth quarter of 2012.

“Net interest margin continues to hold up reasonably well given the decline in asset yields,” Fuller said. “At this point, we do not anticipate a substantial change in margin for the near future.”

Nonperforming loans, exclusive of those covered under loss sharing agreements, were $32.8 million or 1.18 percent of total loans and leases on March 31, compared with $43.2 million or 1.53 percent of total loans and leases on Dec. 31, 2012.

Approximately 42 percent, or $13.7 million, of Heartland Financial’s nonperforming loans have loan balances exceeding $1 million. These nonperforming loans, involving 7 borrowers, are primarily concentrated in the company’s banks in the western states.

The U.S. Department of Agriculture‘s weekly crop progress report indicated that farmers planted a small amount of corn over the weekend as temperatures warmed into the 70s. Planting of oats advanced but is still running well behind normal.

Iowa Agriculture Secretary Bill Northey said planting may occur in some areas of the state over the next several days. Northey noted that the weather is expected to turn much cooler, with overnight lows dipping into the upper 30s by Friday and high temperatures falling into the mid-40s on Thursday.

Corn for May delivery rose 40 cents, or 6.2 percent, to $6.84 a bushel on the Chicago Board of Trade, on concern that the cool, wet weather will reduce overall yields for the season.

Ground temperatures in the 50s are necessary for corn to germinate. Last year at this time, corn planting stood at 44 percent complete, ahead of the five-year average of 36 percent.

“This April has been the wettest we have seen in the 141 years of weather records compiled by the state climatologist, and the result has been a very slow start to the planting season,” Northey said.

There was an average of two days suitable for fieldwork during the week that ended Sunday, according to the USDA report. Field activities included tilling and application of fertilizers and herbicides.

Topsoil moisture levels were rated 3 percent very short, 7 percent short, 76 percent adequate and 14 percent surplus. Subsoil moisture levels were rated 13 percent very short, 31 percent short, 51 percent adequate and 5 percent surplus.

If the weather improves next week and soil temperatures rise, Northey said farmers have a chance to plant before May 10 — considered the end of the normal corn planting period. After that, yields may decline because the plants are unlikely to be exposed to as many days of sun and warm temperatures.

Most farmers plant soybeans after they have finished planting corn. Northey said soybean yields also could be affected.

The USDA report showed oat planting is 45 percent complete, considerably behind the 97 percent planted at this time in 2012. The five-year average is 79 percent.

Hay prices continue to be an issue for livestock producers with some second crop small square bails fetching $455 per ton last Wednesday at the Fort Atkinson Hay Auction. The USDA rated pasture and range condition 16 percent very poor, 23 percent poor, 40 percent fair, 19 percent good and 2 percent excellent.

Alliant Energy Corp.'s Interstate Power and Light subsidiary said Monday it has reached agreement with the Iowa Office of Consumer Advocate (OCA) regarding construction of a new $700 million natural gas-fired electric generating plant in Marshalltown. (contributed photo)

Alliant Energy Corp.‘s Interstate Power and Light subsidiary said Monday it has reached agreement with the Iowa Office of Consumer Advocate (OCA) regarding construction of a new $700 million natural gas-fired electric generating plant in Marshalltown.

Interstate Power previously filed for approval of eight rate-making principles before beginning construction of the 600-megawatt Marshalltown Generating Station. The OCA and the utility resolved its three remaining differences in the proposed settlement.

The agreement, which must be approved by the Iowa Utilities Board, includes an OCA-recommended return on equity of 11 percent for the project and a return on equity of 10.3 percent used to calculate the allowance for funds used during construction.

Interstate Power had asked for an 11.25 percent return on equity for the project.

The OCA and Interstate Light and Power have withdrawn their positions on double leverage and agreed that the issue can be addressed within the context of a rate case or other proceeding. Double leverage involves debt used both at the utility subsidiary and the parent holding company levels to help finance a utility.

The Iowa Utilities Board has set a May 21 hearing to consider Interstate Power’s request for a generation certificate for the Marshalltown station and to consider the utility’s proposed rate-making principles.

Interstate Power has not reached agreement with other organizations seeking to intervene in its request for a generation certificate.

The utility expects a decision from the utilities board on the Marshalltown station by the fourth quarter of this year. The decision to grant a certificate for construction of the facility would be contingent on the utility receiving all necessary permits and regulatory approvals.

The decision would include approval for construction of a natural gas pipeline to supply fuel to the Marshalltown station and an air permit from the Iowa Department of Natural Resources.

“The 600 megawatt, combined-cycle natural gas Marshalltown Generating Station is a key piece of our long-term energy resource plan,” said Tom Aller, Interstate Power president. “Reaching a fair and reasonable settlement agreement with the OCA is a significant step forward in executing our plan.”

If approved, the power plant could be put in service in spring 2017.

Beef Products Inc. (BPI), as part of a consent decree filed April 23 in U.S. District Court in Cedar Rapids, also agreed to conduct third-party audits of its compliance with the Clean Air Act’s risk management program requirements at the company’s South Sioux City, Neb., facility.

A plant worker walks through the Beef Products Inc (BPI) facility in South Sioux City, Nebraska. (REUTERS/Lane Hickenbottom)

BPI will then have 90 days to submit a plan to the U.S. Environmental Protection Agency (EPA) that will correct identified violations within a year.

The April 23 settlement stems from a 2007 incident at the now-closed Waterloo facility that released more than 1,000 pounds of anhydrous ammonia into a production area occupied by BPI workers. The anhydrous ammonia trapped two BPI employees resulting in the death of an employee and another becoming permanently disabled.

During the response to the release, BPI reportedly directed its employees to enter the facility while dangerous levels of airborne anhydrous ammonia continued to be present.

After the 2007 incident, the EPA gathered information about the ammonia release and plant operations through information requests and an inspection.  Based on its investigation, the agency determined that BPI did have a risk management program on paper, but failed to implement the program at the Waterloo plant , contributing to the 2007 incident.

Regional Administrator Karl Brooks said implementing a risk management program is integral to the safe operation of processing facilities where anhydrous ammonia is used.

“The 2007 incident in Waterloo demonstrates that having a plan only on paper increases the risk of accidental exposure to both employees and first responders,” Brooks said.

Anhydrous ammonia is considered a poisonous gas, but is commonly used in industrial refrigeration systems. Exposure to its vapors can cause temporary blindness and eye damage and irritation of the skin, mouth, throat, respiratory tract and mucous membranes.

Prolonged exposure to anhydrous ammonia vapor at high concentrations can lead to serious lung damage and death.

The BPI plant in Waterloo was closed in May 2012 after national news reports questioned the safety of its lean finely textured beef, leading McDonald’s, Burger King, Taco Bell, Wal-Mart and school lunch programs to abandon the product.

Although the product was deemed safe by the U.S. Department of Agriculture, BPI saw demand plummet from 5.5 million pounds in 2009 to 2 million pounds. The family-owned company closed three of its four processing facilities and laid off more than 700 employees.

The rate of Cedar Rapids area foreclosures among outstanding mortgage loans was 2 percent in February, a decrease of 0.17 percent from 2.17 percent in February 2012.

Activity in Cedar Rapids was lower than the national foreclosure rate, which was 2.85 percent in February.

The foreclosure rate measures the percentage of loans in some stage of the foreclosure process.

The rate represents the current inventory of loans in the foreclosure process.

The Cedar Rapids mortgage delinquency rate also decreased in February. CoreLogic reported that 3.46 percent of mortgage loans were 90 days or more delinquent in February, compared with 3.61 percent for the same period last year.

The rate of Iowa City area foreclosures was 1.06 percent for February, a reduction of 0.21 percentage points compared with 1.27 percent in February 2012.

The mortgage delinquency rate also decreased in Iowa City. CoreLogic reported 1.89 percent of mortgage loans were 90 days or more delinquent in February, compared with 2.19 percent for the same period last year.

CoreLogic announced that it has acquired Case-Shiller, which creates and publishes the widely-followed Case-Shiller Indexes, from Fiserv Inc.

The Case-Shiller Indexes will be renamed the CoreLogic Case-Shiller Indexes. The S&P/Case-Shiller Home Price Indices will retain their brand name.

David Stiff, chief economist for Case-Shiller, will continue to supervise the preparation of the CoreLogic Case-Shiller Indexes and comment on the findings of those indexes. Mark Fleming, chief economist for CoreLogic, will continue to supervise the preparation of the CoreLogic HPI reports and comment on the findings of those reports.

The corporate parent of MidWestOne Bank posted net income of $4.8 million, or 56 cents per share in the quarter that ended on March 31, up 8.1 percent from $4.4 million, or 52 cents per share, in the first quarter of 2012.

The increase in net income was attributed to a 4.1 percent increase in net interest income and a 65.5 percent decrease in the provision for loan losses. That was partially offset by a 5.2 percent decline in non-interest income.

Charles Funk, MidWestOne Financial Group president and chief executive officer, said the first-quarter results show the company is off to a good start in 2013.

“Much of our improved performance came from the strong results of our loan pools and this was a big factor in achieving growth over last year,” Funk said. “While we are exiting this line of business, we believe that the positive results attained in the first quarter is a favorable indicator of overall improvement in the general economy.

“Most of the financial indicators that we closely monitor continue to improve as well. We are especially pleased with our 11.98 percent annualized return on tangible equity and 58.56 percent efficiency ratio attained for the first quarter.”

Despite increases in loan balances, loan interest income declined $1 million, or 7.4 percent , to $12.1 million for the first quarter of 2013, compared with $13.1 million for the same period of 2012, due to the general low interest rate environment.

“The pressure on net interest margins is an industry-wide phenomenon and MidWestOne is not immune,” Funk said. “While we are pleased with the modest loan growth experienced in the first quarter, the new loans we are booking are at

historic low interest rates.

“Although we see some loan growth opportunities in our markets, the competition for each loan is intense and it seems clear that even with loan growth, asset yields will continue to come down.”

The Des Moines-based financial services and insurance provider posted first-quarter net operating earnings of $233.3 million, or 79 cents per share, up 8 percent from $215.3 million, or 71 cents per share, in the same quarter of 2012.

Analysts surveyed by Reuters expected first-quarter 2013 net operating earnings of 74 cents per share.

Principal Financial recorded operating revenue of $2.2 billion for the quarter, an increase of 6 percent from $2.1 billion for the first quarter of 2012. The company missed analysts’ average first-quarter operating revenue estimate of $2.3 billion.

Larry Zimpleman, Principal Financial chairman, president and CEO, said the company’s first-quarter results continued the momentum of several previous quarters.

“Our ability to attract and retain institutional, retirement and retail investors around the world resulted in more than $28 billion of net cash flows over the trailing 12 months,” Zimpleman said. “Our acquisition of Cuprum successfully completed in the first quarter, contributing meaningfully to our current results.”

Terry Lillis, Principal Financial senior vice president and chief financial officer, said total company fees and other revenues are growing by double digits, reflecting Principal Financial’s shift toward a fee-based business model.

“As our business model generates increasing amounts of deployable capital, we’re able to put that capital to work opportunistically for the long-term benefit to our shareholders,” Lillis said. “Since the beginning of 2012, we’ve allocated $2.4 billion on strategic acquisitions, common stock dividends and share repurchases.

“For the remainder of the year, we’ll focus on onboarding Cuprum and look at opportunities to deploy additional capital in the second half of the year.”

The Cedar Rapids avionics and communications equipment provider will close down printed circuit board production over the next six to nine months, Rockwell Collins spokesman Josh Baynes  said.

“Thorough business analysis shows that over the past several years, the volume and profitability of Collins Printed Circuits has declined steadily,” he added.

“Therefore, the business decision has been made to transition our printed wiring board business to a preferred supplier who specializes in printed wiring boards to allow us to focus on our core products while better managing costs and assets.”

Baynes said the  shutdown will affect approximately 80 employees, who will have the opportunity to apply for other open positions within the company. Employees will be given a minimum 30 days notice before their last day.

Employee notifications will begin in August, with expected last-day-worked some time between September 2013 and  January 2014.

Outsourcing printed circuit board production is fairly common in the electronics industry.

Apple, currently the most valuable company in the United States, outsources the manufacture of all the components, including printed circuit boards, which are used to create its well known products such as iPhones and iPads.

There were 170 crashes involving farm equipment and cars or trucks last year, which also resulted in 11 major injuries, 35 minor injuries and 40 other possible injuries. Of the 170 crashes, 96 only involved property damage.

The Iowa DOT is urging motorists and farm vehicle operators to exercise caution during the busy spring planting season. The agency also is asking for increasing patience on the part of motorists who will be sharing the road with slow-moving farm equipment.

Farm equipment typically displays a triangular-shaped, red and fluorescent orange slow-moving vehicle emblem. In many cases, the planters pulled by tractors are wider than a lane, requiring motorists to wait until a farmer can safely move to the shoulder of the road.

In some cases, the shoulder may not be too narrow or unable to support a heavy farm vehicle.

Katy Anderson, coordinator of Historic Hills Scenic Byways in southeastern Iowa, called attention to the lack of sufficient shoulders along the state’s secondary roads at the April 9 Iowa Transportation Commission meeting in Coralville.

“We have a lot of tourists who want to see rural Iowa and the Amish, so they drive on our secondary roads,” Anderson said. “In some cases, there’s no where for farmers or the Amish to pull off or very little area along the shoulder to get out of the way of traffic.

“There are a lot of scenic byway areas in Iowa. We’re finally working cohesively as a group to leverage our position as state-designated byways to effect some change.”

While the DOT is focused on preventing farm equipment-related accidents on Iowa roads, federal legislation to prevent children from performing certain agricultural work deemed too dangerous was scrapped last year.

Facing political pressure from Republicans and farming organizations, the U.S. Department of Labor withdrew the proposed rules due to concern from the public over how they could affect family farms. Although family farms were exempted from the proposed rules, many opponents called them as an assault on family farms and rural traditions.

They would have affected minors who were formally employed and on farm payrolls, preventing them from operating heavy machinery, handling tobacco crops, working in grain silos or performing other jobs considered potentially dangerous.

The Iowa Fiscal Partnership on Wednesday released a report analyzing the effects of the House and Senate plans on various businesses of different sizes throughout the state.

“We found that big-box stores benefit disproportionately in the House bill, while the Senate bill benefits lower-valued properties — smaller businesses — more than larger, higher-valued properties,” said Heather Milway, a research intern who conducted the study.

The House bill applies a rollback to property value in much the same way residential property is treated, while the Senate bill provides a tax credit to achieve reductions.

When fully phased in by fiscal year 2019, the House bill would reduce all businesses’ property tax payments by 22.2 percent. Savings under the Senate bill would vary by the size of the business, the report said.

A business with less than $622,500 valuation in property would receive a bigger break with the Senate bill — up to 42.8 percent — while larger businesses would receive a greater reduction under the House bill.

The report contended that the Senate bill, when fully phased in in fiscal year 2019, would provide owners of business property worth $5 million or more a reduction of less than 3 percent in property taxes. Any small business with $323,000 or less in taxable value would see a 42.8 percent reduction.

Peter Fisher, research director of the Iowa Policy Project and co-author of a policy brief on the issue for the Iowa Fiscal Partnership, said substantial property tax cuts for commercial property are not needed across-the-board.

“The biggest justification for either plan is political — not based on any inherent economic need to reduce commercial property taxes,” Fisher said. “The governor’s claim that it is needed for competitiveness purposes versus other states is exaggerated because Iowa taxes on business overall are very competitive and even low.”

Fisher and Milway contended that more than $1 billion in taxable value in Iowa is owned by seven national retail chains — Target, Walmart, Lowe’s, Home Depot, Menard’s, Kohl’s and Sears.

“No economic reason exists to subsidize these national companies, which know they must locate in Iowa to sell products to Iowans,” the researchers argued in their report. “They also compete with local businesses.”

The Iowa Fiscal Partnership is a joint public-policy analysis initiative of the Iowa Policy Project in Iowa City and the Child & Family Policy Center in Des Moines.

Dawn Ainger, president and chief executive officer of Genova Technologies. (Courtesy photo)

Dawn Ainger, president and chief executive officer of Genova Technologies in Cedar Rapids, and Bruce Lehrman, founder and CEO of Involta in Cedar Rapids, are among 29 entrepreneurs selected from 61 nominations by a panel of independent judges.

Ainger purchased majority ownership of the former Computer Solutions in 2001 and changed the name of the business to Genova Technologies. The company specializes in project management, custom software development, requirements capture and multilevel information technology consulting nationwide with clients in the private and government sectors.

Lehrman launched Involta in 2007 and opened the company’s first data center in Marion in 2008. The company provides data center facilities, and manages and protects companies’ mission-critical computer systems and data.

Under Lehrman’s leadership, Involta also has established data centers in Ohio, Minnesota, Arizona and Idaho.

The awards program recognizes high-growth entrepreneurs who demonstrate excellence and extraordinary success in such areas as innovation, financial performance and personal commitment to their businesses and communities. Award winners will be announced at a special gala event on June 13 at the Minneapolis Marriott City Center.

Bruce Lehrman, founder and CEO of Involta. (Courtesy photo)

Other Iowa entrepreneurs selected as finalists are Jerry Foster of Foster Group in West Des Moines, Jim Masterson of LightEdge Solutions in Des Moines and Jon Troen of Rock Communications and Colorfx in Newton.

The Upper Midwest region includes companies based in Iowa, Minnesota, Nebraska, North Dakota and South Dakota. Collectively, this year’s finalists created nearly 4,000 jobs over the past three years, providing employment for 19,588 at the end of 2012.

The companies generated more than $9.6 billion of revenue in 2012, and grew their employment by nearly 20 percent and revenues by 40 percent between 2010 and 2012.

Demolition work is under way on the Armstrong Center in downtown Cedar Rapids to accommodate and entrance for parking underneath the structure. (Cliff Jette/The Gazette)

Underground parking is coming to two downtown Cedar Rapids buildings that formerly housed department stores.

Armstrong Development Co., owner of Armstrong Centre at 222 Third Ave. SE, is developing underground parking spaces for building tenants. The building, constructed in the late 1950s, housed Armstrong’s department store until it closed in 1991 and was remodeled for office and retail tenants.

“We will have 55 parking spaces to offer our tenants,” said Jon Dusek, president of Armstrong Development. “We will be widening the entrance off Third Street SE to about 18 feet 8 inches at its narrowest point, which will be the last 10 feet before you get to the street.

“We will be taking part of the space leased to the library up to the columns — about two feet — as well as recapturing some of the space leased by Hills Bank.”

Dusek said an overhead exterior door will be installed to provide security. A rapidly-opening interior door will help prevent cold air from entering the parking area during the winter months.

Dusek said providing an amenity for tenants was the driving force behind the decision to install parking in an area that has housed offices before the June 2008 flood.

“I also wasn’t too excited about putting people in office space in the basement again,” Dusek said.

Underground parking is one of two major changes planned for Armstrong Centre. Dusek said the exterior canopy on the Third Street side of the building will be removed to provide a different look for the building.

“I will be working with my architect and structural engineer to finalize what I want to do,” he said. “Eventually we will be removing the Third Avenue canopy to alter the appearance of the building.”

At Town Centre, 201-221 Third Ave. SE, owner Steve Emerson has constructed a ramp off Fourth Avenue SE into the lower level of the building that housed Killian’s department store until it closed in 1982.

“Initially we will have 40 spaces and ultimately 70 spots in there,” Emerson said. “We’ve installed the ramp, the lighting and the mechanicals. We’re waiting on the delivery and installation of some air-handling equipment.

At Town Centre, 201-221 Third Ave. SE, owner Steve Emerson has constructed a ramp off Fourth Avenue SE into the lower level of the building that housed Killian's department store until it closed in 1982. (Cliff Jette/The Gazette)

“Once we get the air quality stuff done, we will be able to start parking down there.”

Emerson said tenants of the building will have first choice of the spaces. He said the parking is expected to open in 30 to 60 days, depending on the installation of the air-handling equipment.

Emerson said he typically does not try to lease office space on the lower level of any building that he owns.

“I would rather that they leased space on the main floor of another building across the street than space in my basement,” he said. “It just makes more sense and it’s better for the downtown.”

Underground parking has been available on Mays Island for the Linn County Courthouse, connected by a tunnel since the 1970s. The June 2008 flood damaged the facility, which was closed for repairs until recent months.

Data released Tuesday shows 136,400 residents of the Cedar Rapids metropolitan statistical area were working last month, up from 136,100 in February but down from 136,700 in March 2012. The unemployment rate dipped 7 percent to 5.3 percent in March from 5.7 percent in February and fell 11.7 percent from 6 percent in March 2012.

Total nonfarm employment in the Cedar Rapids metropolitan statistical area added 300 jobs from February, and stands at 139,800 jobs. This represents no change from one year ago.

Activity among the individual industries was minimal. There was some upward movement in leisure and hospitality and natural resources and construction with gains of 200 jobs in each. Financial activities added 100 jobs.

Government partially offset those gains with a loss of 200 jobs.

In the Iowa City metropolitan statistical area, 89,400 residents were working last month, up from 88,600 in February and 88,200 in March 2012. The jobless rate dropped 0.2 percent to 3.5 percent in March from 3.7 percent in February and fell 0.8 percent from 4.3 percent in March 2012.

Nonfarm employment in the Iowa City metropolitan statistical area gained 600 jobs from last month. The job gains were split among government, goods-producing and private service -providing industries. Government and goods-producing industries each added 200 jobs.

No Iowa City area industries have shed jobs from a year ago, although leisure and hospitality remains unchanged. Government has added just 100 jobs, professional and business services added 300 jobs and an additional 600 jobs were added in trade, transportation and warehousing.

The Linn County unemployment rate slipped to 5.1 percent in March from 5.5 percent in February. In Johnson County, the jobless rate edged down to 3.4 percent in March from 3.5 percent in February.

Iowa’s seasonally adjusted unemployment rate for March dropped to 4.9 percent from 5.0 percent in February, according to the state.

March’s jobless rate was significantly below the 5.4 percent recorded in March 2012.

Tyson Pet Products was approved for $1.1 million in tax credit assistance from Iowa’s High Quality Jobs Program. The approval is contingent on the review of some late information received by the state agency.

Tyson Pet Products will remodel 75,000 square feet of an unoccupied portion of the 125,000 square-foot pet treats plant to expand production capacity. The expansion essentially will triple the production capacity of chicken jerky dog treats in Independence.

Plans call for the remodeling and equipment installation to occur in August, with production beginning in September. The project is valued at $24.1 million, according to documents from the Iowa Economic Development Authority.

The dog treats manufactured in Independence are sold under the True Chews, Nudges and Top Chews brands. The treats are sold across the United States to customers of Petsmart, Costco, Wegmans, Meijer and other pet specialty stores.

Tyson Pet Products, a division of Tyson Foods, reopened the Independence plant in 2010 after the parent company shut down production of chopped ham and sliced luncheon meats in March 2006.

The closing of the Independence plant and 43,000-square-foot Tyson Foods facility in Oelwein put 371 northeast Iowa residents out of work. Tyson continued to own the shuttered Independence plant, which it reopened after receiving financial incentives from Independence and the state.

(Reuters)

With the new Southlands expansion, the Mountain View, Calif.-based Google’s investment in its Iowa facilities totals more than $1.5 billion. The data center, originally slated for a $200 million expansion, houses computer systems and associated components that support services such as Google Search, Gmail, Google Maps and GooglePlus.

Iowa Lt. Gov. Kim Reynolds said Google was a pioneer for high tech development in the state.

“The company’s first investment of $600 million was followed by investments of $300 million, $200 million and now an additional $400 million,” Reynolds said. “Google has not only invested heavily in Iowa, they’ve helped to create an atmosphere of high tech development that is the envy of the Midwest.”

The Iowa Economic Development Authority board on Tuesday amended the state’s original agreement with Google to increase sales and use tax credit benefits from $9.6 million to $16.8 million. The expanded data center will create 35 additional jobs.

“As demand for our services grows, our operations need to grow as well,” Chris Russell, Google data center operations manager, said. “We’re excited to be an integral part of Iowa’s expansion into next generation technology.”

Google’s expansion announcement came on the same day that Facebook Inc. confirmed plans for the $299.5 initial phase of a $1 billion data center in Altoona.