Reichman "overjoyed" with MEGA bill passage

LEE COUNTY – As state legislators exhaled after a full special session at the Iowa Capitol Friday, and recover from the thorough beating the Hawkeyes took on Saturday, Sunday became a day of not only reflection, but thoughts of “what’s next.”
State Sen. Jeff Reichman (R-Montrose) ushered Senate file 2508 through the State Senate and through to its passage on Friday night. He joined Governor Kim Reynolds and other state and Lee County officials in a bill signing ceremony later that night.
Reichman said he’s “overjoyed” to see the potential for a game-changer for Lee County.
“My first four years our economy was growing pretty well, but the last few years we’ve been at 2% growth and that’s not keeping up with where we need to be. We needed something,” he said.
“I grew up here in the heyday of southeast Iowa when the populations were at their largest in Lee County. It’s crushed me to see us wither away. Company A closes, then another one. Then I worked at (General Electric) in Burlington and they were at 1,000 employees and then that was cut in half, and then sold out. Case, all these one-by-one in a domino effect.
“You can’t believe how much pride I have that this gives a resurgence to Iowa and gives people a reason to stay in Iowa. Des Moines County, Henry County, Lee County – we’re already hearing talk about people investing and wanting to put a footprint here. This will be $5.59 for every dollar invested into southeast Iowa in resource returns. It stays here and fosters growth. I’ve been overjoyed that this is moving forward.”
Reichman said there is a Memorandum of Understanding with Mesabi, but there has been no agreement signed between the state and the company. He said he doesn’t know when that will happen, but said that will be the foundation of the contract with them. But he said the Iowa Economic Development Authority will oversee that agreement. He said Lee County is still negotiating with Mesabi, as well. Even on Friday during the special session, the location site in Lee County was kept out of discussion and, in some cases, Lee County itself wasn’t specifically mentioned as the location.
However, both State Reps. Blaine Watkins (R-Donnellson) and Matt Rinker (R-Burlington) stood and spoke in support of the bill on Friday, and Reichman opened and closed floor debate in the Senate.
Reichman said he’s cognizant of the hedging on naming Lee County officially by the company and most state officials, but he said it’s not uncommon for companies to do that to protect their negotiating leverage.
“I think that’s for legal concerns, at this point. They have not signed a contract for here, yet. They do have purchase agreements here, and they do not have those anywhere else in the state.  They are trying to maintain their best footing from a negotiation standpoint.  When you negotiate a car, you shouldn’t go in and say, ‘Oh my god, I love this car, I have to have it.' You give up all your leverage,” he said.
“They have done diligence and have agreements in place here. I can say they do not have that anywhere else in the state.”
Reichman said the whole process has been guarded and, although he didn’t personally sign a Non Disclosure Agreement, there is one in place at the state level. He said he was operating under the priniples of Lee County Economic Development Group whose policy is to not discuss projects that haven’t been officially publicly announced.
“It is extremely guarded and there is a reason companies do that. They are protecting their interests and it’s a very delicate walk. It’s not about secrecy and keeping the public away. It’s a very competitive environment,” Reichman said.
He said the state legislature put the IEDA in place and approved the MEGA site incentive programs. But they appointed Debi Durham to manage those developments and they entrust that department to work out the details.

“We have and I do, and they brought this home for us.”
Lee County Supervisor Garry Seyb, who was part of the contingency at The Capitol Friday, said he’s still not comfortable talking too much about the project because there is no official designation for Lee County as the project site. Seyb did confirm that the county, along with attorneys from BrownWinick, out of Des Moines, are in negotiations with Mesabi on county incentive packages. He said he would be optimistic that an agreement could be coming within the next few weeks.
“We’re pretty close,” he said. “I think they will move with some quickly and I believe it will be this week that there will be a lot of discussion. If the company was saying Lee County… Lee County, I would be more comfortable saying more.”
But he said he was excited about the possibility of a major generational economic driver coming to Lee County.
“(Gov. Reynolds) signed the law and an offer can now be made, but I don’t know if they have signed anything with the state or not. I have not seen anything, nor has anyone said this is 100% Lee County. But there are indicators that would say that,” Seyb said.
“There’s pressure on anyone who’s negotiating. You have POTUS and the State of Iowa saying we're doing this thing. We’re the last spin in the spin cycle. But there’s not a blank check here by any means. There has been communication going back and forth for a period of time, and I think we’re very close. But it’s not done until Supervisors say it’s done.”
Reichman said he was made aware of the project in the summer, but hard work was being done by state and county officials dating back to 2025.
“Over the summer I was asked to come over, and they brought a large group from Mesabi to meet with us and we talked about this project,” Reichman said. “Negotiations went on and on and we found out we were very well suited because of the transportation outlets we have in our area. Talks continued with IEDA and LCEDG and, ultimately, we realized we may need workable project legislation crafted to meet some needs.”
Reichman reaffirmed that there are specific phases to the project and the state’s $1.36 billion incentive package is tied to completion of the phases with each incentive package spread out over 10 years.
For example, he said the company has to have 100 employees hired during phase 1 and that wouldn’t include the 4,000 construction workers that will “be all over like ants getting this project built”.
He said the state has options built into the law that allows them to reclaim some of the incentives if the project phases aren't completed per the agreement, which isn’t upfront money.
He said until the agreements are all signed, nothing is without some risk.
“Every single thing in life doesn’t go with zero risk. There’ a chance that something won’t happen. People are making multiple billion-dollar decisions that everything will go according to plan. We have set, I feel, and arguably no one could argue with me, guidelines that nothing gets paid out until phase 1 is up with people hired and in production,” he said.
On Friday night, Reynolds had a few comments but took no questions from media still hanging around the session.
“Today’s special session advances the most consequential economic development ever to come to our state,” Reynolds said. “By enacting reasonable and limited changes to the Major Economic Growth Attraction program, we’re clearing a path for Mesabi Metallics to make the largest steel investment in the U.S. right here in Iowa. This means $15 billion flowing into our economy and thousands of high-paying, family-sustaining jobs. Higher wages attract workforce, strengthen local businesses, and grow communities. This opportunity will accelerate the economic trajectory of our state, and our country, for generations.”