September 4, 2015

Iowa Business Council survey shows ‘tempering of enthusiasm’

Business-councilThe latest survey of the CEOs of Iowa’s largest companies shows they’re expecting the state’s economy will be cooling off in the coming six months. Elliott Smith is executive director of the Iowa Business Council (IBC).

“The release of our third quarter survey did indicate a bit of a tempering of enthusiasm, I think, for some of the economic activity that we’ve seen lately,” Smith said. The survey employs a 100 point scale, with a score over 50 considered “positive sentiment.”

The IBC’s third quarter Overall Economic Outlook Survey Index was 59 — eight points lower than last quarter and six points lower than one year ago. “I think we are seeing some impact of international economic activity finally resonating here in the state, simply because so much of Iowa’s business activity itself rests on export trade and international business,” Smith said.

The survey shows most of the CEOs anticipate steady or increased hiring levels, sales and capital spending between September and February. But, Smith notes the numbers in all three of those categories are down from previous surveys. “Yes, the survey did back off a little bit from its previous optimism, but I think we’re still in for a decent remainder of 2015,” Smith said. ”

The numbers still remain solidly in positive sentiment territory, so I don’t know if there’s any need to raise red flags of warning yet.”



U-I presidential candidate challenged over his business background

Bruce Harreld speaks during his public forum in Iowa City.

Bruce Harreld speaks during his public forum in Iowa City.

The fourth candidate for the University of Iowa president’s job took a lot of questions Tuesday about his background during a public forum on the Iowa City campus.

That’s because Bruce Harreld comes from a mainly business background, not academic. Harreld manages a business consulting company and his past experience includes teaching at the Harvard Business school, he was a senior vice president at IBM, and president of the Boston Market food chain.

Harreld addressed the issue of his background right away, saying he believes he has experience from the business world that would help improve the university. He was asked if his approach would treat the school too much like a business.

“There’s a tendency to believe that institutions like the University of Iowa have customers, and the customers are the students. And I think part of this arms race (for students) is in that spirit,” Harreld says. “There’s something very different about an institution like this — it clearly serves the state, we have a clear role in that. And that may be more important than any set of students.”

He says he can understand how people might think his approach would treat the school simply as a business, but says that’s not what he would do. “I would fight vociferously to differ with all due respect, to the notion that I’m just going to be another corporate guy and come in here and slash and burn. I actually think part of the answer here is…going from great to greater, because we can actually start talking about outcomes and be damn proud of what’s going on, tell the story,” Harreld says.

Harreld was asked about the new Board of Regents “performance-based” funding proposal which has the University of Iowa losing funding to the other two state schools. He says he could see a scenario where he could support it because of the limited amount of state funding available. “It could actually be that there are legitimate needs at the other institutions and there may be a period of time where they need more funding,” Harreld says. “It could actually come back the other way…there might be a time when some of that money might come back to us when we need it more. I would say to the other schools scoot over and support us as we supported you. So yes, I can imagine reasons for that.”

Harreld says he doesn’t know enough about the details of the plan to take a stand on it right now. “I actually think from what I’ve read, is that the title sounds great, but there’s potential for a lot of for mischief down underneath there. And I wouldn’t put it in the context of fairness — I would put it in the context of is it right for the state?,” Harreld says.

The issue swung back to Harreld’s qualifications again when a woman named Sarah Riley who says she is an attorney in Cedar Rapids and a second-generation Hawkeye stepped to the microphone. She says she was furious to see a finalist who had never had any leadership or administrative role at an institution, and says she didn’t change her mind after hearing his remarks. “Why did you even apply for this job?,” Riley asked. “Good, question and I’ve tried to answer that question. I think I can help, and if you don’t think I can help, I totally respect that,” Harreld answered. “But why do you think you can help if you have no background?,” Riley continued. “Because I’ve worked through transformation and taking an institution from whatever the numbers are to something higher,” Harreld responded.

Harreld was the last of four finalists to visit campus. You can see the full forum on-line at the University of Iowa Presidential search page. The Board of Regents plans to interview the four candidates on Thursday and then select one as the new president.


Branstad defends state tax incentives for new Kum & Go headquarters (AUDIO)

Terry Branstad speaking at his weekly news conference.

Governor Terry Branstad speaking at his weekly news conference.

Governor Terry Branstad today called the “Kum & Go” convenience store chain a “great…family-owned”, Iowa-based business and he has no objection to the nearly $19 million in state tax incentives it will get for moving the company headquarters to downtown Des Moines.

“These decision are made by the Iowa Economic Development Authority Board and they have certain criteria in terms of job creation that they evaluate to determine who’s going to receive assistance,” Branstad said during his weekly news conference.

AUDIO of governor’s weekly news conference

Kum & Go executives have promised to create at least 90 new jobs in the new $151 million headquarters. The company’s existing headquarters is in West Des Moines. The company’s first store opened in 1959, in Hampton. Kum & Go is now the country’s fifth-largest privately-owned convenience store chain, with 432 outlets in 11 states.

(Photo by Asya Akca)

Iowa telecoms to use $53 million in federal money for broadband expansion


Michel Sadler of CenturyLink speaks at Branstad’s weekly news conference.

Governor Terry Branstad invited executives from four telecommunications companies to his weekly news conference this morning to tout recently announced federal grants that are destined to expand broadband access in rural areas. The $53 million will help 88,000 homes and business either connect to broadband for the first time or get access to higher download speeds.

“Access to broadband is critical to economic development, education, telemedicine and quality of life for all,” said Michael Sadler, a vice president with CenturyLink.

Gregory Gray, a regional manager for Windstream Communications, also spoke at today’s news conference.

“This will enable us to serve high cost areas and deliver new services to many others,” Gray said.

Frontier Communications, which serves 36 communities in western Iowa, will use its federal grant money to provide service to 5400 customers.

“Those are in the rural areas, the highest cost service areas, those that do not yet have service,” Jack Phillips of Frontier said.

Consolidated Communications serves eight northwest Iowa communities that used to get land-line service from Heartland Telephone.

“The economics associated with being able to do this would not happen without this support from the FCC,” said Mike Schultz of Consolidated.

Consolidated will offer broadband service to about 3000 customers once the expansion is complete. These companies are putting up an undisclosed amount of their own capital for these projects and each company will qualify for new state property tax credits. Governor Terry Branstad said he wants Iowa to be the “most connected” state in the Midwest.

“Obviously we want to do that as quickly as we can,” Branstad said. “And we want to get the speeds up as quickly as we can.”

The governor acknowledged it will take billions of dollars to expand broadband statewide with enough speed to download at 25 megabits a second.

MidAmerican announces plans for wind farms in Ida and O’Brien counties

Wind-PowerOfficials with Iowa’s largest utility unveiled plans today to add two new wind farms in the state. They’ll be built in Ida and O’Brien Counties, both in northwest Iowa.

Ruth Comer is a spokesperson for MidAmerican Energy. “This will be the first wind farm of any kind in Ida County, located near Ida Grove. We’re going to build 134 turbines there,” Comer said. The other project involves 104 turbines and it will be MidAmerican’s second wind farm in O’Brien County.

“We currently have the Highland wind farm under construction in O’Brien County. We’re scheduled to complete that at the end of 2015,” Comer said. “Then, in 2016, we’ll get started on a second wind farm we’re calling O’Brien.” The two new projects will add up to 552 megawatts of wind generation capacity, according to Comer. With the addition of the Ida Grove and O’Brien wind farms, MidAmerican Energy will operate wind farms in 23 Iowa counties.

“By the end of 2016, when these two newest projects are completed, we’ll have more than 2,000 wind turbines across the state,” Comer said. In 2014, Iowa generated more than 28 percent of its electricity from wind — more than any other state in the country.

Lime Springs beef plant looking for workers in 2 job fairs

The Lime Springs Beef website.

The Lime Springs Beef website.

A new meat processing plant in northern Iowa’s Howard County is holding a couple of cattle calls for workers this week.

Lime Springs Beef spokesperson, Kyle Wooters, says they are hosting job fairs on Thursday in Cresco and Saturday at the plant.

“We’re looking to hire between 50 to 60 people, that’s to fill productions jobs, as well as a few in the shipping, some maintenance, and a few office support staff as well,” Wooters says.

He says they plan to hire people in waves during the next several weeks in anticipation of opening the 15,000 square foot facility. “We’re looking to open in the beginning part of October, so we’re looking to hire our first wave employees probably at the end of September so they could start in early October,” Wooters explains. He says the Limes Springs plant, which is close to the Minnesota border, is going to be different than the mass production processing plants owned by major corporations.

“We will be processing about 112 head a day — which is drastically different. So the pace of work won’t necessarily be as fast,” Wooters says. “And employees here will have a vast variety of jobs so they won’t be doing the same thing all day long. That’s what makes us pretty much different from the big guys.” Wooters says the work will be less repetitive for employees than you find in most manufacturing plants. “They might spend half the day doing one job, half the day doing another job, instead of a full eight hours of just one cut, same thing every day,” Wooters says.

Lime Springs Beef also says it’s treatment of cattle will be more humane, with shorter travel distances. Wooters says the ownership is also different for this plant. “A lot of the investors are actually local cattle producers as well, so it kind of has a local ownership group. So the community is heavily invested in this project,” Wooters says. Members of the Crestwood FFA Chapter in Cresco have also invested 20-thousand dollars in the project.

The job fair Thursday is at the Northeast Iowa Community College Center in Cresco, and the Saturday job fair is at the plant on Highway 63.


Legislator tapped to head Iowa Association of Electric Cooperatives


Chuck Soderberg

A Republican legislator from northwest Iowa will soon resign to take over as general manager of the Iowa Association of Electric Cooperatives, which provides power to about 650,000 Iowa customers.

Representative Chuck Soderberg of Le Mars has worked for the Northern Iowa Power Cooperative for the past 36 years. Soderberg grew up on a dairy farm near Burt, Iowa, and has lived in Le Mars for the past four decades. Soderberg will move to the Des Moines area and he’ll start his new job with the state association for Rural Electric Cooperatives on September 8.

“The organization provides a number of services to the RECs and the generation transmission cooperatives throughout the state from the regulatory support, legislative support, safety support and education and communications,” Soderberg says, “Also included are the association’s health insurance plans and the retirement programs that many of the RECs participate in.”

Soderberg, who is 58 years old, has served in the Iowa House since 2005 and, for the past two years, he has been chairman of the House committee that writes the state budget. He’ll resign from his House seat soon and a special election will be held to select his replacement.

“From a timing standpoint, we’re still working through that,” Soderberg says.

Soderberg’s House district covers Plymouth County and parts of Woodbury County. It has a solid Republican voter registration edge. Soderberg ran unopposed in the district five times and easily defeated a Democratic opponent in 2008.

(Reporting by Dennis Morrice, KLEM, Le Mars; additional reporting by Radio Iowa’s O. Kay Henderson)