Don’t open door to scandals in economic development (Video)

Senator Brian Schoenjahn of Arlington raises concerns about the Governor’s proposal to change Iowa’s economic development efforts (HF 590).

Transcript:

I want to thank Senator Sodders and others for working to improve House File 590. I’d like to share some basic concerns I have about this legislation today. Do we really want to run the department of economic development the same way Iowa Association of School Boards was run?

For more than a year, the Senate has fought to hold those people accountable for their lavish salaries, and to expose improper relationships between for-profit, non-profit and public organizations. Today, I’m worried the Branstad Administration about to repeat that disaster on a grand scale again.

First, the Governor wants the Iowa Department of Economic Development to become a new state entity called “Iowa Economic Development Authority.” And even though Governor says public employees are overpaid, the salaries and benefits of the top five people would be OUTSIDE the state compensation system.

Director Debbie Durham decides who gets the big bucks. She can even include herself as someone who gets special compensation. And by the way, the Director of this new authority will no longer be appointed by the Governor or confirmed by the Senate. Instead, he or she will be hired by the Authority Board of Directors.

Will this new director be paid $367,000 like Maxine Kilcrease, the former director of the Iowa School Board Association? Will the top people take paid vacations in Bora Bora? Chauffeured limousines and free tickets to Hawkeye games, who knows? We don’t know.

Secondly, the House legislation creates a private non-profit called the Iowa Economic Development Corporation. We’re supposed to funnel state contracts to it for various services. If this does not remind you of the Iowa School Board Association scams, you haven’t been paying attention.

This private organization would be free to ignore many of Iowa’s open records and open meeting laws. It would also be free to make money off its various enterprises.

Once again, a non-profit would to turn public dollars into private profit. To me, this looks like a house of cards. It does little to improve real economic development and does a lot to increase the risk of fraud and abuse.

Iowa needs an effective economic development department. But before going down this path, we should carefully and skeptically examine this proposal.

Let’s learn from past mistakes. Simply stated, I don’t think we have nearly enough safeguards to approve this proposal at this time.