A Republican who serves in the Iowa legislature says he supports efforts to boost manufacturing in the United States, but State Senator Jeff Taylor of Sioux Center says he has concerns about the incentive package for a proposed steel plant in southeast Iowa.
“I would like to be able to support it, but the way it’s written right now, no. I won’t be able to vote for it,” Taylor said during an inteview with KSOU radio.
The legislature is set to convene tomorrow to vote on a bill that would include about $1.4 billion in tax credits for the project that was announced at the White House Monday. “Initially I was very excited about it,” Taylor said, “but as I have learned more about the proposed deal…I have serious concerns, and really on two levels, but they’re both tied to the incentive package that the state of Iowa, specifically the Reynolds administration, has come up with.”
Taylor said he’s not convinced the state would recover its investment through increased economic activity and he questions providing that much taxpayer money to a foreign company under private ownership. “We are facing a budget crunch in the state of Iowa,” Taylor said. “We will be okay in the short run, but this is a commitment of a substantial amount of money — spread out over ten years, that is true, and also it’s conditional on the factory continuing to operate…but it’s an upfront commitment that we’re going to have to factor in for the next 10 years. And $1.4 billion is a lot of money.”
According to Taylor, Governor Reynolds has told Republican legislators no changes would be allowed in the bill that outlines the deal she negotiated with the company. Other GOP lawmakers say they’re ready to vote for the package. State Representative Bob Henderson of Sioux City said the incentive package sounds large, but isn’t when compared to the overall cost of the project.
“Generally speaking, I think it’s just an excellent plan,” Henderson said. “…Just consider the fact that the projected investment into Iowa is $15 billion. That’s one-and-a-half times what the state budget happens to be for the State of Iowa right now, so the impact of that I cannot imagine.”
Henderson expects the projected 6000 people hired to build the plant and the over 1700 hired to work there once it opens would boost state tax revenue, too. “We may see impacts on things like gas and on sales tax and clearly on income tax,” Henderson said during an interview with KSCJ Radio. “Those are statewide issues where it actually turns out to be a benefit.”
The legislature is scheduled to convene in Des Moines at 8:30 a.m. tomorrow.
