Fertilizer plant sends tax money out of Iowa

Gov. Terry Branstad was the driving force behind giving one of the wealthiest families in Egypt, if not the world, $251 million of Iowa's future income to help build a $1.4 billion fertilizer plant in southeast Iowa and buy Iowa's largest construction company. At the same time, House Speaker Kraig Paulsen “promised that no matter what lawmakers do next year under total Republican control, overall state government spending would be less.” Am I the only person in the state who thinks this is a strange combination of announcements?

All the general contractors in the state that have poured money into Branstad coffers over the years just got thrown under the bus. What are the chances that what will be one of the world's largest contractors with all kinds of new capital will give the locals a sniff of the profits on the largest project in Iowa? Going forward, what about other major projects around the state that have been shared by a consortium of contractors because none was big enough to handle the projects alone?

In Economic Development 101, we learned that you give away money in tax credits because over a certain time period you not only get all the benefits of the project, but you also recoup the money through new taxes. So my question is this: How many years will it take to recoup the $251 million of taxpayer money?

Thomas A. Martin

Iowa City