The Iowa City Economic Development Committee is trying to attract companies to a new industrial park in the southeast area of Iowa City.
Officials are planning to offer Good Job Incentives — in the form of property-tax relief — to companies that locate in the new area and pay wages higher than county averages.
“It makes sense for the city to be actively pursuing companies that can increase a property tax base,” said Iowa City Mayor Regenia Bailey. “Our goal is to give broad guidelines to staff so they can present them to companies in interest.”
While not completed, the proposed incentives are split into three levels. For a company to receive Level One incentives, the average starting wage for all positions must equal the average county wage. Level Two requires wages 25 percent higher than the average, and Level Three requires 60 percent higher.
There are further requirements at each level regarding starting wages and individual health-insurance premiums.
Officials from other cities have also used tax incentives. West Des Moines, for example, persuaded an international insurance group, Aviva, to build its U.S. headquarters there. It received property-tax rebates as incentive to settle there, said Clyde Evans, the city’s director of community and economic development.
Nearby, the Wells Fargo bank campus in West Des Moines also receives property tax rebates.
“Companies like to see who’s in the neighborhood,” Evans said. “And when you can say you have those two in the neighborhood, it definitely helps from an economic-development standpoint.”
Iowa City purchased the 173 acres near an existing industrial park, Scott Six, the home of the Proctor & Gamble building. Officials acquired the land early this year.
According to the proposal from Wendy Ford, the city’s economic-development coordinator, long-term goals include bringing new jobs to the area and eventually leading to tax relief for residents by building a large commercial tax base.
Ford’s letter to the Economic Development Committee calls for competitive incentive packages for surrounding areas that may offer free land or already have tax relief incentives in place.
When it comes to finding companies, incentives aren’t the only marketing point. Bailey said the city markets its wind-energy campus, noting the trend toward energy efficiency.
Bailey, also a member of the Economic Development Committee, said further discussion to solidify the incentives is on hold for now because the state is putting together some general guidelines to help cities come up with beneficial proposals. Still, she noted, the city must have some initiative to present to companies — and soon.
“Some of those decisions need to be made very quickly,” she said.