A debate that failed to develop

It's a real shame that the race for governor is over, otherwise we might be having an important debate over the course of economic development policies.

Sure, not a single ballot has been cast. But we've got polls, so who needs voters? A couple of recent surveys show Republican Gov. Terry Branstad with a massive lead over Democrat Jack Hatch. If this race were a novel, it would be on the clearance rack.

Or maybe not. A new poll out Monday showed Hatch trailing by just 6 percentage points. Careful not to get polling whiplash.

But let's forget the polling for a moment and consider the candidates' dueling economic development philosphies.

Hatch has proposed a plan that would at its core, replace state-centered economic development programs with ones administered regionally. He'd create four regions, roughly aligned to congressional districts, each with its own development authority calling the shots and pool of incentives funded with state dollars.

Under Branstad, the Iowa Economic Development Authority largely runs the show from Des Moines. State officials and selected private sector allies do much of the recruiting, make the deals and hand out incentives. Branstad has been operating this way since the 80s and 90s when the old Iowa Department of Economic Development created an alphabet soup of incentives programs.. The acronyms and faces change, but it's a system still aimed at putting ribbon-cutting scissors in the governor's hands.

The poster project for that approach is a $1.8 billion fertilizer plant project in Lee County being built by Orascom Construction Industries, now doing business here as Iowa Fertilizer Co. The state has delivered $83 million of a promised $100 million in tax breaks for the project, not to mention tens of millions pledged locally. The company also issued more than $1 billion in tax-exempt federal bonds available through a program aimed at aiding recovery from Iowa's natural disasters in 2008.

Hatch and Branstad bickered over the project at Saturday night's gubernatorial debate in Burlington. The governor points to 240 permanent jobs and 1,900 construction jobs. Hatch basically argues that the Branstad administration gave away the farm to get the fertilizer. That, Branstad says, makes Hatch anti-jobs.

My biggest problem with these large incentives deals is that there is almost no meaningful, independent oversight. Economic development staff hired by the governor negotiate incentives packages behind closed doors and they're approved by a board picked by the governor. Signed, sealed and delivered. All we have is the word of these folks that it's a great deal. There's no objective review. Some are announced and approved on the same day, or within a few days.

And anyone who questions or raises issues with these projects is condemned as anti-growth. Was Orascom really considering Illinois when those fedeal disaster bonds were only available in Iowa? Illinois is thr root of all evil. Next question.

So it's 'trust us,” and 'don't question us.” 'This is just how the game has to be played. By us, with your money”. Fact is, politicians on both sides of the aisle love big incentives. That's why critics are so few and far between.

I think Hatch has something with his regional approach, although I don't think congressional districts would make good development regions. We should, instead, identify real economic regions that already exist and where some development cooperation is already happening. That's where new state resources could do the most good, in the hands of leaders with a better grip on local needs and a regional vision.

Still, regional development authorities fostering local growth might miss out on the next Orascom. That would be a real shame. Or maybe not.

l Comments: (319) 398-8452; todd.dorman@thegazette.com