SPRINGFIELD — Bidding between Illinois and Iowa for a $1.2 billion fertilizer production facility apparently starts at $35 million.
According to Illinois officials, Iowa is offering Cronus Chemical LLC an estimated $35 million in taxpayer subsidies to build a plant in Mitchell County, located on the state’s northern border with Minnesota.
Although a total dollar figure for Illinois’ offer wasn’t available Friday, state lawmakers will be asked in the coming weeks to approve a series of tax breaks for the project in hopes of luring it to a site near the east central Illinois town of Tuscola.
The proposal, sponsored by state Rep. Adam Brown, R-Champaign, would qualify the Tuscola development for sales tax exemptions, investment tax credits, exemption from state gas and electric taxes and a state sales tax exemption on personal property. The legislation also would provide up to $12 million in property tax abatement for the plant.
“Project Cronus would be a huge boost to the local economy in terms of construction jobs and overall investment,” Brown said. “But Illinois needs to step up its incentive package to bring this project to the state.”
The Times Springfield Bureau first reported Thursday that a bidding war was brewing between the two states for an anhydrous ammonia and urea production facility that would bring 2,000 construction jobs and 150 full-time jobs once it is operating.
The company has kept a low profile in its search for a site and, according to the Delaware Secretary of State’s office, has been registered as a company there only since November.
It wasn’t until Friday morning that Mitchell County officials went public with the news that they have been working behind the scenes to lure the company to the area.
“Project Cronus, indeed, would bring hundreds of permanent, high-quality employment opportunities and a very large capital investment to North Central Iowa,” said Brenda Dryer, executive director for the Mitchell County Economic Development Commission. “At this time, I am not in a position to discuss further details of the project as negotiations are still under way.”
Dryer noted in a statement that the fertilizer plant would serve farmers in a tri-state area and add to the local workforce with additional transportation and maintenance jobs.
“This potential project would enhance our existing industries and have a far-reaching impact on agriculture throughout this region of the country,” Dryer said in a prepared statement.
The proposal comes a year after Illinois and Iowa went head-to-head over a different, large-scale fertilizer plant, which eventually won an estimated $100 million in subsidies to build in Lee County, Iowa. For several weeks, a site in Scott County was under consideration.
Iowa Gov. Terry Branstad has been criticized for the size of the give-aways connected to the Egyptian-owned plant. Branstad said the incentives were necessary to bring jobs to an under-developed region.
Under the proposal pending in the Illinois House of Representatives, the Cronus project must get legislative approval because it does not meet the job-creation threshold for receiving many of the subsidies the company wants.
“The General Assembly needs to pass this incentive package soon if we want to compete on a level playing field for Project Cronus,” Brown said.