The head of Iowa’s top job creation agency was in the hot seat at the capitol Monday. Lawmakers and union representatives grilled Iowa Economic Development Authority Director Debi Durham about mass layoffs at the Iowa Fertilizer Company plant in Lee County. But Durham says the record-breaking incentives that attracted an Egyptian company to Iowa will not be scaled back.
The pink slips last month took union workers and state lawmakers by surprise.
Durham says she found out about them from Burlington Democrat and labor supporter Senator Tom Courtney.
“My conversations started when you called me, Senator,” Durham said to Courtney around a statehouse conference table. “You said there was some unrest locally.”
The nearly $2 billion project, which went to the Egyptian firm Orascam, raised hackles from the start because of the giant incentive package the company negotiated. Now critics say the incentives were a mistake if Iowa construction workers can’t benefit.
On April 18th, Iowa Fertilizer Company fired the major subcontractor, along with its 1400 skilled tradesmen and women. Now a replacement subcontractor is recruiting non-union workers from Texas.
Durham asked Ryan Drew with the Southeast Iowa Building Trades Council for any information he’s received about the layoffs.
“That’s part of the problem,” Drew said. “The communication has stopped.”
“When did that stop?” Durham asked.
“When we checked people out the gate and they received their last paycheck,” Drew replied.
Jerry Hobart with Plumbers and Pipefitters Local Union No. 125 described their layoffs.
“We had 890 pipefitters on the project,” Hobart said. “They were let go that night. My phone started blowing up.”
Royce Peterson with a carpenters union local from Iowa City has a similar story.
“I left at four o’clock in the afternoon. My phone started ringing at 4 in the morning with our night shift getting terminated.”
Senator Courtney wants Durham to at least bring the company and union workers together for talks.
“If anyone can have input with this company it ought to be you,” Courtney said.
“Obviously we have concerns about this as well,” Durham said. “All we can offer now is good will.”
Durham says that’s because when the state puts together an incentive package with a company like Orascom, all the company promises is a certain amount of capital investment and a certain number of jobs. Durham says she doesn’t know anything about the new subcontractor recruiting non-union workers from Texas.
“But I will make a call tonight,” Durham said.
Durham says she’ll encourage the company to communicate with the unions to answer their questions.
Robins Democrat Liz Mathis wonders if that’s the only avenue left.
“Is there anything in the agreement that would halt some of the incentives at this point?” Mathis asked.
“There’s nothing in any of our agreements that trickles down to those who do the contracting work,” Durham replied.
“They're at the tail end of the construction period so things are winding down,” Durham said. “So that's the last I heard.”
A spokesman for the subcontractor who was laid off, leading to all the pink slips, would not comment, referring questions instead to his company’s legal department.
A spokeswoman for Iowa Fertilizer said in a project this size it’s common to replace subcontractors. And she added that construction is about to be wrapped up anyway.