Principal Financial Group snagged $22.5 million in state tax credits Thursday for its massive downtown Des Moines campus renovation, one of three expansions Friday that whittled down the state’s available business credits to $1.5 million.
With the state in the hunt for projects that include an elusive $1.5 billion data center, Director Debi Durham said the agency will need to tap into next year’s pot of tax credits to land jobs and investment in Iowa.
Using next fiscal year’s credits is allowed under state law, Durham said, adding that the state is experiencing an unusual number of $1 billion-plus projects. CF Industries plans to invest $1.7 billion expanding its fertilizer plant near Sioux City, and Orascom Construction Industries is building a $1.4 billion plant in Lee County.
“No one anticipated that we’d have billion-dollar projects. We had two and have one in the wings,” Durham said.
Lawmakers have criticized the Orascom project, saying the incentives are too rich. Orascom Construction, based in Egypt, received $50 million in tax credits last year and CF Industries, $22 million. Orascom also has the option of seeking a total of $50 million over the next two years.
Durham said the state rarely provides the full amount of tax credits allowed under law, including to the fertilizer plants. “We only provide what we needed to get the deal done,” she said.
The agency is asking lawmakers to boost the $120 million cap on business tax incentives to $185 million, the state’s original cap on tax credits, beginning this fiscal year.
Durham said the state is still competing aggressively for the massive data center project, and she talks almost daily with the company involved. Nebraska also is working hard to land the project, beefing up its state incentives to match Iowa’s for high-tech development.
Principal’s nearly $285 million modernization project will cement the financial services company in Des Moines and Iowa for decades to come, leaders said. “It’s a really big upgrade and a good project for the city,” said Pete Brownell of Grinnell, a member of the Iowa Economic Development Board.
The state said the project would help retain 1,740 workers in the Des Moines area. Principal is considering upgrading three downtown buildings so they’re more appealing to knowledge workers who want high-tech, environmentally friendly spaces.
The city of Des Moines is looking to give Principal Financial 50 percent of any new property taxes generated from improvements made to its buildings for up to 15 years. The city is not yet able to estimate how much it will rebate to the company, City Manager Rick Clark said.
The city also plans to consider pushing up replacement of a parking garage near the company and beautification of Keosauqua Way, a main street leading into downtown.
With the state in the hunt for projects that include an elusive $1.5 billion data center, Director Debi Durham said the agency will need to tap into next year’s pot of tax credits to land jobs and investment in Iowa.
Using next fiscal year’s credits is allowed under state law, Durham said, adding that the state is experiencing an unusual number of $1 billion-plus projects. CF Industries plans to invest $1.7 billion expanding its fertilizer plant near Sioux City, and Orascom Construction Industries is building a $1.4 billion plant in Lee County.
“No one anticipated that we’d have billion-dollar projects. We had two and have one in the wings,” Durham said.
Lawmakers have criticized the Orascom project, saying the incentives are too rich. Orascom Construction, based in Egypt, received $50 million in tax credits last year and CF Industries, $22 million. Orascom also has the option of seeking a total of $50 million over the next two years.
Durham said the state rarely provides the full amount of tax credits allowed under law, including to the fertilizer plants. “We only provide what we needed to get the deal done,” she said.
The agency is asking lawmakers to boost the $120 million cap on business tax incentives to $185 million, the state’s original cap on tax credits, beginning this fiscal year.
Durham said the state is still competing aggressively for the massive data center project, and she talks almost daily with the company involved. Nebraska also is working hard to land the project, beefing up its state incentives to match Iowa’s for high-tech development.
Principal’s nearly $285 million modernization project will cement the financial services company in Des Moines and Iowa for decades to come, leaders said. “It’s a really big upgrade and a good project for the city,” said Pete Brownell of Grinnell, a member of the Iowa Economic Development Board.
The state said the project would help retain 1,740 workers in the Des Moines area. Principal is considering upgrading three downtown buildings so they’re more appealing to knowledge workers who want high-tech, environmentally friendly spaces.
The city of Des Moines is looking to give Principal Financial 50 percent of any new property taxes generated from improvements made to its buildings for up to 15 years. The city is not yet able to estimate how much it will rebate to the company, City Manager Rick Clark said.
The city also plans to consider pushing up replacement of a parking garage near the company and beautification of Keosauqua Way, a main street leading into downtown.
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