Every now and then, an issue arises locally that poses a real threat to our natural resources and subsequent standard of living. This time it is in the form of an amendment to Scott County’s Comprehensive Land Use Plan (CLUP) that currently protects our most precious asset – the richest soil in the world.
Residents will have an opportunity to be heard on this matter during a public hearing scheduled for 5 p.m. on Thursday, March 24, in the Scott County board room on the first floor of the Scott County Administration Building at 600 West Fourth Street in Davenport.
The amendment, called an “Industrial Floating Zone” and recommended by the county Planning & Zoning (P&Z) Commission, would permit spot zoning for large-scale industrial operations anywhere in the unincorporated areas of Scott County (outside city limits). At a July 2013 meeting, the Planning & Zoning Commission was told by Planning & Development Director Tim Huey that the Board of Supervisors was interested in reviewing and updating the CLUP to better reflect the county’s strategic-plan goals – with a focus on language for commercial and industrial zoning to further economic-development objectives. This was in response to losing the $1.4-billion Orascom fertilizer plant to Lee County because of the Agricultural Preservation Zoning District that protects ag land and prevented this industrial intrusion into dedicated farmland.
A community’s CLUP, at both the city and county level, provides a blueprint of permissible land use for the benefit of current and future property owners, and investors who may be considering our community for their endeavors. Currently there exists an agriculture-preservation component of Scott County’s zoning ordinance that disallows the sale of ag property for anything other than agriculture. In other words, farmers and rural property owners cannot sell their farms to industrial operators, commercial developers, etc. Property owners who are located in the ag-preservation district can’t even build a second home on their own land.
For years, rural property owners have complied with such limitations relative to their parcels, understanding that the much bigger picture of protecting the best, most-productive soil in the world is far more important. In addition, all these years ag preservation has provided a semblance of economic security to owners that the integrity of use will prevail through time in Scott County. If the amendment is approved by the Scott County Board of Supervisors on Thursday, April 7, that security vanishes with the votes of three out of the five county supervisors.
Imagine if spot zoning were allowed in or near your neighborhood, and suddenly an industrial mega-operation (potentially 1,000 acres or more) was approved close to you. It isn’t just the site itself that is transformed by such a massive operation, but all the surrounding properties in a circumference proportional to the size of the development. Property values would predictably drop through the floor, and the environmental impact would be enormous, regardless of the amount of regulation.
That would then open the door for additional industrial and/or commercial development in the area, because new operations could be shown to conform to similar use in the area, creating a snowball effect. It perpetuates the absurd any-growth-at-all-costs mentality.
Let’s take the attempt three years ago by the Egyptian company Orascom to site its $1.4-billion fertilizer facility in Scott County, with robust enthusiasm from supervisors Tom Sunderbruch (then the chair of the board) and Jim Hancock. Never mind that Orascom partakes in nearly $350 million in tax subsidies while investing only 5 percent of its own money. In the end, the only thing that kept that plant from being built here was our ag-preservation zoning policy.
The board of supervisors justified its support for Orascom with the 100-plus new jobs promised, paying median wages of $26 an hour, and an increase in the tax base and property-tax revenues. Taxing bodies were projected to gain more than $26 million in additional property-tax revenues over 15 years. That is not chump change to be sure, but there are a lot of giveaways and associated development costs borne by taxpayers that need to be accounted for before that amount can be accurately, let alone fairly, claimed.
For example, the tax incentives ultimately given to Orascom – monies set aside to attract just such mega-ventures – were $251 million, of which $133 million was given by Lee County in the form of property-tax abatement. (There are an additional $84 million in giveaways to Orascom under its other name, Iowa Fertilizer Company.) These types of incentives, in the form of tax credits, rebates, and funds for training, continue for 10 to 20 years before the property is actually billed for its full tax obligation. By then, however, the facility’s depreciation is so significant that it substantially reduces the original assessment used to sell the project to the public. While there is an eventual increase in revenue to the state and county taxing bodies, it never comes close to the increased tax revenue promised, especially in future dollars. (See RCReader.com/y/spot1.)
The more taxpayer-funded incentives given, the greater the real cost per job. And the number of jobs and actual wages rarely match the original promises. Worse, the mechanism for holding corporations to those terms is largely nonexistent. At some point, Orascom’s jobs aren’t worth the cost to bring them to a community, let alone the degradation of the community both economically and environmentally.
Bigger is not necessarily better with economic development. Mega-sites are almost always an unholy alliance between big business and big government, both heavily subsidized by taxpayers. The industrial operators, colluding with the state and county in this case, are the only meaningful financial beneficiaries. The public services alone (utilities, sewer, garbage, fire, police, and regulatory oversight) to support a mega-site are no small consideration, and are basically free for the start-up years.
Agriculture accounts for 30 percent of Iowa’s revenue, and already this sector receives taxpayer subsidies. Meanwhile, the largest employers in Iowa are our small businesses. This is true nationally, yet there is a distinct bias in government’s economic-development financial assistance toward the interests of big corporations over those of small business, as evidenced by a recent in-depth report done by Good Jobs First (RCReader.com/y/spot2).
The report demonstrates that most of Iowa’s economic-development funds go to the nation’s largest corporations, who need the assistance least. In Iowa, there are 63,720 registered businesses, with 1,754 businesses qualifying as “large” employers with 500 or more employees. Comparatively, there are nearly 62,000 registered businesses with fewer than 500 employees (RCReader.com/y/spot3). Yet, according to Good Jobs First, roughly $884 million in subsidies in recent years have been given to global giants Orascom/Iowa Fertilizer Company, DuPont, Microsoft, IBM, Rockwell Collins, Deere, and Nationwide Insurance for Iowa projects.
Imagine if those same dollars, or even a portion of those funds, went to small businesses for expansion? How much more bang for our buck would we realize with this strategy for economic growth and job creation? How many smaller businesses could generate 100 jobs with the same or higher median wages without compromising agricultural land, or requiring expensive offsetting tax abatements/credits, or consuming massive resources to operate?
And what of the opportunity costs, such as the lost acres of premium soil taken out of production, or the devaluation of the surrounding properties after a mega-site is built? The infrastructure resources required for such facilities – such as water, electricity, roads, rail, and barge traffic – are often extremely high, potentially stressing surrounding systems, especially over time. Given that and the industrial zones currently in place within city limits and nearer to transportation, efforts should certainly be directed to existing areas zoned for industrial purposes rather than sacrificing higher best uses of land presently zoned for other purposes.
There are many unintended consequences with mega-sites that need little imagination to conjure. Research shows that newer, more-modernized facilities replace a substantial amount of labor with robotics. And it is not uncommon for construction jobs to be imported from out-of-state rather than using local talent, union or not.
None of this is addressed in the language authorizing the Industrial Floating Zone, which is a creative name for spot zoning. The trouble with this mega-site allowance is that it isn’t confined to a specific location. Instead, it opens up the entire unincorporated area of Scott County, leaving all rural property owners exposed.
Also problematic is the legality of this Industrial Floating Zone, because by any other name it is spot zoning. Prudently, the P&Z commission requested a legal opinion on the proposed change to the CLUP. Assistant County Attorney Robert Cusack obliged with a reasoned opinion finding that, while the inclusion of the Industrial Floating Zone in the CLUP is legal, its implementation will likely give rise to legal challenges. His opinion is based almost exclusively on the illegality of spot zoning.
An Industrial Floating Zone is an ill-conceived recommendation, and the public needs to stand with our rural community against the special interests of county bureaucrats, bankers, real-estate developers, and the Quad Cities Chamber and its lobbyists – all of whom have a seat on the P&Z commission, leading to this recommendation getting unanimous approval. Members of the commission include Clayton Lloyd (the retired head of community and economic development for the City of Davenport), Dan Portes (CEO of Management Resources Group and chair of Iowa Growth PAC, which is affiliated with the Quad Cities Chamber), Tony Knobbe (retired president of Quad Cities’ Wells Fargo Bank), Lynn Gibson (who works in business development for Bush Construction/Real Estate Development), Carolyn Scheibe (executive director of the Eldridge-North Scott Chamber of Commerce), and Marsha Findlay (the retired vice president of Brenton Bank). The only rural voice on the commission, by design, is Hans Schnekloth of Schnekloth Farms. (See RCReader.com/y/spot4.) Over the past two years, all commission members who rejected interfering with ag preservation via re-zoning mechanisms were replaced with people who support the change.
Furthermore, County Administrator Dee Bruemmer has said publicly to the Board of Supervisors that, as a participant in the Quad Cities Chamber’s regional economic-development efforts, she has signed confidentiality agreements about businesses interested in locating here. She added that while details could not be shared, the county is falling short of meeting “big” companies’ expectations. But the Board of Supervisors’ constituents are Scott County taxpayers, and board members shouldn’t blindly go along with staff objectives without all the relevant information.
The public should weigh in with the Board of Supervisors on this matter at the March 24 public hearing. Let the supervisors know that they will not be re-elected if they vote to approve this amendment to the CLUP.
The public needs to remind this board of the near-unanimous support for ag preservation. Countywide surveys conducted several years ago as part of the county’s customer outreach revealed strong support for ag preservation. With no equivocation, one of the top priorities cited by both urban and rural residents is preserving our agricultural land due to its exceptional soil quality. Scott County residents are well aware that we are singularly blessed as a community with this precious asset. Trading down by approving the Industrial Floating Zone for any portion of Scott County ag land would be a violation of the community’s trust – not just by our elected supervisors, but also by any county staff that supports such risk-abundant land use.
Scott Countians need to internalize that standing against an Industrial Floating Zone in Scott County is first and foremost about protecting property rights, not objecting to economic development. Nothing is more central to our liberty, the rule of law, and our way of life. Big business and big government know they have to pay to play. So the only way regular folks win over the interests of big business and big government is to show up. You must be present to win.