Corbett and Hiawatha City Hall in feud over jobs and incentives

CEDAR RAPIDS - War is being waged over jobs in the metro area, and for now, Mayor Ron Corbett has become Enemy #1 at City Hall in neighboring Hiawatha.

Hiawatha Mayor Tom Theis and Hiawatha City Council member Dick Olson on Wednesday afternoon accused Corbett of using “submarine” tactics and an “11th-hour giveaway” to redirect a new employer and a possible 500 new jobs from Hiawatha to downtown Cedar Rapids.

Theis said Corbett is also working on grabbing an existing company with 400 employees from Hiawatha.

“It would quite a feather if he gets the jobs,” Theis said. “ … It would be a pretty good resume-builder.”

For his part, Corbett on Wednesday said competition among cities in the metro area is good, and he said his central concern as Cedar Rapids mayor is figuring out a way to get employers to move to Cedar Rapids' flood-hit downtown.

Corbett said two numbers matter greatly to him as he wears his “flood-recovery hat”: the numbers 5 and 10. Five denotes that the city has sustained the fifth worst natural disaster in the nation's history in regard to public infrastructure; and 10 is the percent drop in the downtown's property valuation because of the flood, he said.

The employer in the middle of the intercity jobs battle that has been planning to move to Hiawatha is Go Daddy, an Internet domain registrar and web hosting company that also sells e-business related software and services. Go Daddy, founded by former Hiawatha businessman Bob Parsons, announced plans earlier this year to buy and occupy a 50,000 square foot building in Hiawatha than once housed a technology software company owned by Parsons.

Theis and Olson said that renovations at the building have been under way, and the Hiawatha officials said that the Hiawatha City Council intended to vote on a $125,000 economic-development incentive for Go Daddy at its June 15th meeting.

On Wednesday, though, representatives from Cedar Rapids Area Chamber of Commerce's economic development arm, Priority One, arrived at Hiawatha City Hall with a letter from a Go Daddy representative to Priority One. Priority One has been handling the negotiations under its name, “Project Click,” between Hiawatha and Go Daddy.

In the letter, John Lenio, managing director of “economic incentives group” CBRE of Phoenix, Ariz., states that the mayor of Cedar Rapids has offered Go Daddy a set of incentives to locate in downtown Cedar Rapids that Go Daddy now would like the city of Hiawatha “to meet or exceed.”

Lenio states that Go Daddy is putting its Hiawatha plans on hold for now.

Lenio also outlines the Mayor Corbett's offer to Go Daddy, which Hiawatha's Olson estimates is valued at $4.5 million.

“We are astounded by the offer,” Olson said. “Corbett has raised the stakes to the point that he knew we couldn't make any kind of counteroffer.”

In his letter, Lenio states that Corbett has offered to “give” Go Daddy a 60,000-square-foot building, the six-story, former MCI call center building at 323 Third St. SE, with furniture intact. The building is vacant and privately owned by Steven Dummermuth and Kay Hill.

Additionally, he states that Corbett has said Cedar Rapids will fund 100 percent of the cost of the improvements to the flood-damaged building, will provide free parking at an adjacent parking ramp and will provide a similar $125,000 job training grant as Hiawatha.

“If that mayor has that kind of money to buy a building and remodel it and give them free parking. Wow, what an incentive,” Hiawatha's Theis said.

Corbett, who from 1999 to 2005 was president/CEO of the Cedar Rapids Area Chamber of Commerce where he preached regional cooperation, said city of Cedar Rapids would not use public dollars alone to lure Go Daddy downtown. Corbett said he would count on the private sector in Cedar Rapids to help with any incentive package for Go Daddy.

Corbett said the key is to keep the Go Daddy jobs in the region, even if they land in downtown Cedar Rapids and not Hiawatha. Cedar Rapids has given Go Daddy a choice that it had not had, he said.

He noted that the public sector is making huge investments in the downtown, “but the bottom line is, we need feet on the street, and that means jobs. And as mayor, I'm going to do all I can to get jobs in the city and in the region.”

Corbett said he's also talked to an existing firm in Hiawatha, PAETEC, to try to convince it to look to downtown Cedar Rapids. He said Paytec needs more space.

“We've got to rebuild our downtown, and there isn't any regional expert around that says that the Number One city (in a metro area) can die and everybody else will be OK,” Corbett said.

Corbett said Cedar Rapids is the strong tree and Hiawatha and Marion and other cities in the metro area are the branches of the tree.

“If the center of the tree dies, some of the branches will die also,” he said.

Corbett argued, too, that the city of Cedar Rapids has lost companies to Hiawatha and Marion over the years.

“We've probably lost more than we won,” he said.

The city of Cedar Rapids currently is using Hiawatha City Hall for its formal council meetings.

Hiawatha's Theis and Olson predicted Hiawatha would take “the high ground” and not rescind the free offer to the Cedar Rapids council.