“As chairman of the Iowa Power Fund, Fred Hubbell wasted millions in taxpayer money on failed projects that created no jobs. An official state report found Hubbell had no strategy for handing out taxpayer dollars. Even worse, Hubbell used his government position to steer millions in taxpayer money to a billion dollar company he was personally invested in.”
Source of Claims
The claims are included in a Reynolds-Gregg gubernatorial campaign TV ad entitled “Fact” airing statewide.
Then-Gov. Chet Culver appointed Hubbell to chair the Iowa Power Fund when he created it in 2007 and Hubbell stayed in that role until Culver’s successor, Gov. Terry Branstad, ended the fund in July 2011. The fund was designed to finance research and projects to promote renewable energy in Iowa.
Claim 1: “As chairman of the Iowa Power Fund, Fred Hubbell wasted millions in taxpayer money on failed projects that created no jobs.”
This claim centers on one project: a 2009 proposal for the Iowa Stored Energy Park, a $400 million underground wind energy storage facility. The Iowa Power Fund pledged $3.2 million to the project, with Hubbell voting in favor. The group behind the project scrapped it in 2011 when a report found Iowa’s geology would not support underground energy storage.
The Iowa Economic Development Authority says the state money was not refunded because the project was considered “successfully completed.” Communications Director Jacque Matsen told us the project was exploratory research that ultimately determined the concept was not viable. But the agency considered it a success because the research was completed.
The ad implies more than one Power Fund project failed and created no jobs, but a 2010 study from the state’s Office of Energy Independence found the fund created or retained 1,428 jobs over seven years with projections to create at least 8,500 more by 2033. That number has not been updated that we can find.
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It’s true the Iowa Stored Energy Park project did not create permanent jobs, but the Reynolds campaign could cite only the one project, not several, as the ad suggests. The state considered the Energy Park project a success as a research effort, which fell within the Iowa Power Fund’s mission. That’s why this claim gets a D.
Claim 2: “An official state report found Hubbell had no strategy for handing out taxpayer dollars.”
A 2012-13 Energy Strategic Plan for the IEDA included brief mentions of the Iowa Power Fund, including a criticism that the fund’s mission was too broad.
“One of the major weaknesses of the Iowa Power Fund was that it lacked a strategy in funding projects,” the report said.
The broad focus of the fund could be blamed on the original mission set by the Culver administration but Hubbell, as chair, would have been responsible as well. This claim gets an A.
Claim 3: “Even worse, Hubbell used his government position to steer millions in taxpayer money to a billion dollar company he was personally invested in.”
This focuses on a $9 million pledge from the Iowa Power Fund in 2011 for DuPont and Danisco to build a $226 million cellulosic ethanol plant in Story County. Hubbell voted twice to approve the project, in 2010 and 2011. That plant opened in 2015, with then-Lt. Gov. Reynolds praising it at the opening. But the ethanol plant closed last year, cutting 90 jobs, with DuPont looking to sell the site.
The project also received another $5 million in other state grants and $3.5 million in state tax credits. That funding was unassociated with Hubbell.
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On a financial disclosure form required of all state board members and elected officials, Hubbell included DuPont as one of 59 companies in which he owned at least $1,000 in stock in 2010. State ethics law does not bar board members from voting on issues where they have a financial stake, only on issues where they have direct employment.
While Hubbell alone did not control the fate of the funding for the DuPont project, he did have a role in approving it. This claim gets an A.
The ad correctly notes Hubbell’s involvement with Iowa Power Fund decisions. But while the fund did spend millions on the Iowa Stored Energy Park without creating permanent jobs, that fell within the fund’s mission and the state considers it a success, not a failure. That drops this ad to a B overall.
The Fact Checker team checks statements made by an Iowa political candidate/officeholder or a national candidate/officeholder about Iowa, or in advertisements that appear in our market. Claims must be independently verifiable. We give statements grades from A to F based on accuracy and context. If you spot a claim you think needs checking, email us at email@example.com.
This Fact Checker was researched and written by Adam Carros of KCRG-TV9.