The Times’ Feb. 22 editorial (“Wanted: Answers to Orascom deal”) criticizing Iowa’s efforts to bring a $1.4 billion fertilizer plant to the state misses several relevant facts and more importantly, the bigger picture of the impact of Iowa’s job creation efforts.

One project in particular — the Iowa Fertilizer Co. — has been the target of a campaign of misinformation. But why?

Is it because the project will create 165 permanent high-paying jobs and more than 3,500 construction-related jobs in the Iowa county with the highest unemployment rate in the state?

Is it because this project will save Iowa farmers $740 million annually, according to the Farm Bureau?

Is it because this project will inject over $1.4 billion in the Iowa economy?

Those facts, all true about the Iowa Fertilizer Co. project that is moving forward in southeast Iowa, are usually celebrated by members of both parties. This time though, they’re not good enough.

Never mind that the Iowa Economic Development Authority, the agency I’m in charge of, has been as transparent as possible about this project — even informing legislators beforehand about the award the board would consider, detailing for them the nuances of the project, and providing metrics to independently measure the impact.

Never mind that our due diligence process was appropriately followed with this project, as it is with all of the projects our board considers. Never mind that, if something is missed, clauses in our contracts protect the state’s investment if a material violation of law or misrepresentation of facts is made by the company. In essence, our “due diligence” process continues for the duration of the contract.

Never mind that the U.S. government, despite originally bringing the lawsuit against Contrack International in 2004 for work done in the ’90s, continues to contract with them to the tune of over $2 billion of design-build projects over the last 10 years. Currently, Contrack has $300 million of on-going work and received awards of $170 million in the fourth quarter of 2012 alone.

As for the contention that Iowa was not credibly competing against Illinois for this massive project, the Times’ own article dated Sept. 14, 2012, quotes two Illinois legislators who were directly involved in wooing the company to lure them across the river. In fact, one legislator quoted in your article said Illinois’ efforts to win the project were “enormous.” After the fact, it’s not surprising that the Illinois development agency would back track in an effort to save face on an opportunity lost.

The truth is, for political reasons, a double-standard is being applied to the Iowa Fertilizer Co., whose parent organization is Egypt-based Orascom Construction Industries. IEDA, on the other hand, treats all applicants equally and fairly, vets projects with a consistent procedure, and determines ROI quantitatively.

The last time I checked, $1.4 billion into Iowa’s economy plus 165 permanent jobs, 3,500 construction-related jobs and countless spin-off jobs, plus hundreds of millions in annual savings for Iowa farmers, plus millions in additional tax revenue (above and beyond the incentives provided) into the state coffers a good deal for Iowa.

Debi Durham is the director of the Iowa Economic Development Authority.

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docpaulsen
docpaulsen


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Egypt Bans OCI Chief From Travel Over Tax-Evasion Claim

By Nadine Marroushi and Ahmed Namatalla - Mar 3, 2013

Nassef Sawiris, chief executive of Orascom Construction Industries, has been banned from travel by Egypt and placed on an arrivals watch list, the state-run Middle East News Agency said, citing an unidentified judicial official.

Sawiris, head of Egypt’s biggest publicly traded company, and his father, Onsi, are accused by Finance Minister El-Morsi EL-Sayyed Hagazi of owing 14 billion Egyptian pounds ($2.1 billion) in back taxes, MENA said. OCI, which has construction and fertilizer units, represents about a quarter of the EGX 30 Index. OCI’s investor relations manager, Omar Darwazah, said by phone that he was unable to comment on the travel ban.

President Mohamed Mursi said in an Oct. 6 speech that the government is seeking to recover money it’s owed by companies. While not identifying any company, he said one of them avoided paying tax on a profit of about 80 billion pounds from the sale of an asset by listing it on the stock exchange two months previously.

OCI sold its cement unit, Orascom Building Materials Holding, in December 2007 to France’s Lafarge SA (LG) for 8.8 billion euros ($11.5 billion) after it was relisted on Egypt’s exchange in October of that year.

Cairo-based OCI denied any wrongdoing following Mursi’s speech. Egypt doesn’t have a capital-gains tax and any change isn’t expected to be implemented retroactively, it said at the time.

To contact the reporter on this story: Nadine Marroushi in Cairo at nmarroushi@bloomberg.net

To contact the editor responsible for this story: Tarek El-Tablawy at teltablawy@bloomberg.net

Klaatu
Klaatu

New industrial projects have become increasingly controversial. Many people would rather just see them go somewhere else. Business activity and the accompanying "pollution" are the bane of the modern liberal. It seems they would rather send out welfare checks, because after all, that's "free" money, it doesn't cost anyone anything. And so it will go until we are Guatemala North.

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