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Branstad Defends Lee County Fertilizer Plant Deal

By on February 19, 2013
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A review by The Cedar Rapids Gazette finds more than 50 companies that have received grants from the State of Iowa in the past decade failed to fulfill job-creation promises.

A total of seven-and-a-half million in taxpayer-funded grants should be repaid to the state under the terms of the contracts.

The newspaper calculated that 11 percent of the economic development grants that have been handed out over the past decade went to companies that failed to meet job-creation goals. Republican Governor Terry Branstad says circumstances have changed since some of those grants were given out.

Branstad is also defending the state’s 110-million dollar incentive package for Orascom, an Egyptian company that plans to build a fertilizer plant in Lee County. Democrats in the legislature say Branstad and his aides were “asleep at the switch” by failing to find out about a lawsuit against a subsidiary of Orascom that alleges the company cheated taxpayers out of millions of dollars spent on federal construction projects.

The lawsuit alleges Orascom formed a secret partnership with an American company to win 332-million dollars in federal contracts, as only U.S. companies were eligible for the work. The fertilizer plant Orascom is building near Wever will employ 165 permanent workers once it opens. The company says the facility will cost one-point-four billion dollars to build. Federal, state and local government incentives for the project total more than half a billion dollars.