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DES MOINES, Iowa (AP) -- Iowa lawmakers passed a bill Friday to increase the ceiling on state tax incentives in an effort to secure a $15 billion steel plant project announced at the White House earlier in the week.
The bill clears the way for Mesabi Metallics, the Minnesota company owned by the India-based conglomerate Essar Group, to receive more than $1.3 billion in public dollars and tax savings as the project gets completed, a proposal even some Republicans criticized.
President Donald Trump announced the plant Monday alongside Iowa elected officials, heralding the project as a major economic and national security investment. Commerce Secretary Howard Lutnick said the "deal is done," but state and local officials in the days after suggested otherwise.
Five weeks before the midterm elections, Republicans seized on the promise of good-paying jobs and a central role for the heartland in the push for American steel manufacturing. It was celebrated as an opportunity for southeast Iowa, an area along the Mississippi River that once thrived as a hub for industry but has since suffered from shuttered facilities and dwindled populations.
The deal and state dollars it would require were met with some skepticism in rural Iowa and Des Moines alike.
Republican State Sen. Dan Dawson opposed the bill and chastised the effort on the floor, apologizing "on behalf of the state of Iowa to the White House," saying they must have been misled about the state of negotiations.
He said the project, as promised, would be a win -- but they were voting on an incentives package, not a project.
"Do I believe the Iowa taxpayer received the best deal in this proposition? Absolutely not," said Dawson, who is the chair of the Senate ways and means committee.
The bill now goes to Republican Gov. Kim Reynolds' desk for her signature.
Reynolds on Tuesday called the Republican-controlled Legislature back for the special session, asking them to increase the cap on incentives for eligible projects to up to 10% of investments paid out over 10 years, contingent on performance and jobs. It also allows the credits to be transferrable, if the state approves.
Debi Durham, director of Iowa's Economic Development Authority, told lawmakers they wouldn't have been called back if Mesabi Metallics had been willing to build the plant in Iowa under the law's current 5% over five years.
Trump announced another major investment for a battleground state this week -- a $54 billion investment by South Korea in a natural gas project in Alaska.