Two of the Democrats running for governor are launching new criticism of the state grant program their Democratic rival Mike Blouin helped create and administer when Blouin was state economic development director.
Secretary of State Chet Culver says 26 of the businesses which have received grants from the Iowa Values Fund haven’t created the jobs they promised. Eighteen businesses which received Values Fund grants have “failed completely” according to Culver, who says “that cost the Iowa taxpayers $3.2 million.”
Culver is also attacking Blouin for claiming he helped “create” 25,000 jobs through his administration of Values Fund grants. “That is factually incorrect,” Culver says. “It’s time for the taxpayers of Iowa to know the truth on the Iowa Values Fund…We need accountability. Why can’t we go to the website today of the Department of Economic Development office? We want some numbers. We want some light to be shined on this process.”
Culver says the performance of the Values Fund is an endictment of Blouin’s leadership of the agency that administered it. “This is Mike Blouin’s project. You know, I agree with the premise. I think the Iowa Values Fund could work. I think Governor Vilsack should be commended for creating it,” Culver says. “The challenge and the problem here is that under Mike Blouin’s leadership things didn’t get done and companies haven’t been held accountable and jobs aren’t being created.”
Blouin defends his record and he says businesses which fail to meet their job-creation promises will be fined, or have to repay the grant. “Chet doesn’t understand. He clearly doesn’t know what he’s talking about on this,” Blouin says. “This is an incentive to affect behavior, not an award for having done something.”
According to Blouin, over 300 companies have received Values Fund grants. “If in fact there are 18 failures, that’s a pretty good ratio,” Blouin says. Blouin, though, says he doesn’t have the “latest” figures on the Values Fund. “I haven’t been at the department for 10 months,” Blouin says. “Unlike everybody else in this race, I resigned my state job so I could eliminate any possible conflict of interest, perception of conflict of interest, so I’m not up on the details.”
Blouin suggests critics like Culver are attacking not only him but Governor Tom Vilsack, too, by raising concerns about the Values Fund and calling for posting Values Fund data on the Internet. “My God, (Secretary of State Culver) put the entire consumer credit code on-line and in the process put over 300,000 individuals at risk for identity theft. It took two months of badgering to get him to take it down and fix it…and make it password accessible,” Blouin says. “He doesn’t understand what he’s talking about and when he makes a sweeping accusation like that he doesn’t realize it’s also hitting the very guy he’s trying to emulate.”
Blouin also denies that he’s claiming he helped “create” 25-thousand jobs. Blouin says he’s always referred to jobs “created or retained” through Values Fund grants.
Ed Fallon, a State Representative from Des Moines who’s the other leading Democrat in the race for governor, is asking the State Auditor to audit the Iowa Values Fund and other state economic development programs.
Fallon has been a frequent critic of the Values Fund. “If you believe in the free market economy, then I don’t know how you can think that the state can fix the state’s economic problems by creating a fund in Des Moines and doling that money out to a hand full of lucky businesses,” Fallon says.
Fallon compares it to “trickle-down” economics. Fallon says it’s “unfortunate” that some Democrats have embraced the concept, but more and more Democrats “are beginning to wake up to the fact that this is a misuse of taxpayers’ money.”
Fallon says he’s repeatedly asked for detailed records about the Iowa Values Fund and been stymied by Vilsack Administration officials. “I’m frustrated with the lack of responsiveness,” Fallon says. “It’s clear to me that I’m not going to make any progress continuing to beat my head against the wall, trying to get them to let the public know how much accountability do we really have with these funds.”
Fallon suggests State Auditor Dave Vaudt did “excellent work” in helping uncover waste and fraud at a central Iowa job training program, and could do the same with the Iowa Values Fund.