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Just a week ago, Iowa’s Governor Terry Branstad announced an incentive deal to bring Orascom Construction Industries to Iowa to build a fertilizer plant. The incentives are greater than Obama’s stimulus plan, which the National Review estimated to cost $185,000 per job.
Branstad’s package comes out to more than $700,000 per job. A separate package from Lee County Iowa comes out to $707,000 per job. On top of those two gifts, the federal government’s Midwest Disaster Area bonds will be used to save the company $360 million in interest due to lower taxes. That savings comes out to $2.1 million per job.
In all, Iowans and Americans are providing this company $3.5 million per job it creates.
When the governor announced the package, Nassef Sawiris, the head of Orascom stood next to him. Nassef’s brother had a similar photo with former dictator Kim Jung Il, after Naguib signed a deal with North Korea for telecom services in 2011.
Conservatives and conservative groups in Iowa and nearby are criticizing Branstad for the deal. They are disappointed that a Republican would use tax incentives so wastefully by making deals with this type company.
Several of those conservative critics took to the Internet on 9-11 after the coordinated attacks on U.S. embassies. Their efforts have been focused through the www.weareiowa.org.
Orascom Asks for Additional $75 Million from Iowa and Lee County
(In addition to the $400 million the company will save through flood bonds)
Sept. 4–Lee County Supervisors and the commissioners of the Iowa Economic Development Authority are holding special meetings on Sept. 5. They are discussing Orascom’s request for $75 million more in tax credits above the $32 million that the company is already receiving from Iowa and Lee County.
Orascom Construction Industries is seeking more than $900,000 per job in incentives from local, state and federal governments to build a fertilizer plant in Iowa or Illinois. Orascom is the wealthiest Egyptian company headed by a family that is worth more than $11 billion. At first they looked at Lee County south of Burlington. Then they started looking west of Burlington. Both sites are still being considered. Meanwhile they are looking at several other locations in Iowa and two in Illinois.All the Iowa locations have in common the availability of Midwest Disaster Area bonds. The state bonds would allow Orascom to borrow as if it is a government body, eliminating the interest payments from being taxed. That enables Orascom to save $120 million in interest payments while depriving the federal government of $400 million. Wherever the company shops its scheme, Orascom also wants local tax breaks, tax increment financing, state tax credits, state provided job training, and highway funds.The total benefit to Orascom comes out to more than $900,000 per job. The federal stimulus package was only $185,000 per job.
The company’s favored site in Lee County is in the flood plain, where millions of gallons of ammonia and nitorgen could be swept into the Mississippi River. The site in Scott County–near Walcott–is some the best agricultural land in Iowa. It was chosen because the environmental restrictions are so loose. To build anywhere, the company needs to draw millions of gallons into the plant and flush out half as much every day.