$15B Iowa steel mill with Minnesota ties takes step forward with tax incentive plan
Trucks and heavy equipment sit outside a Mesabi Metallics mine in Nashwauk, Minnesota. Iron ore from the mine will be used at a new $15 billion steel mill in Iowa. (Photo by Jerry Holt/The Minnesota Star Tribune) ((Photo by Jerry Holt/The Minnesota Star Tribune) / Getty Images)
FORT MADISON, Iowa - Elected officials in Lee County, Iowa agreed to tax incentive terms with Mesabi Metallics, moving ahead with plans to construct a $15 billion steel mill.
Previously, President Donald Trump said the mill, which will be located in southeast Iowa, would be the largest steel plant in U.S. history.
Iron ore used at the steel plant would be mined at a recently opened $3 billion complex in northern Minnesota.
According to a press release, the mill will produce about 10 million tons of steel a year when it's fully built out.
Mesabi expects to employ 1,750 full-time workers at the mill, along with 350 full-time workers at the Minnesota mine.
Iowa steel complex takes financial step forward
Local perspective:
The Lee County Board of Supervisors approved a term sheet with Mesabi Metallics for local tax incentives and community benefits on Nov. 10.
Likewise, the board approved a resolution of support for the project. That's an important step as officials ask for additional incentives from the Iowa Economic Development Authority.
"This is a generational investment in Iowa, and this week’s vote moves it forward," said Joe Broking, CEO of Mesabi Metallics. "Paired with our nearly $3 billion investment in Minnesota, this project creates a fully integrated American steel supply chain—iron ore mined and processed in Minnesota, high-quality steel made in Iowa."
According to Mesabi Metallics, the term sheet requires that the company:
- Pay up to $10.5 million to local and county governments to offset demand on services during construction.
- Create at least $112 million in new property value before receiving any tax rebates.
- Pay Lee County $50 million over 20 years in lieu of additional property taxes.
Dig deeper:
The massive steel mill would rely on iron ore pellets from a mine in Nashwauk, Minnesota.
Located within northern Minnesota's Iron Range, it's the first new iron ore mine built in the United States in 50 years.
That's according to Mesabi Metallics, which is based in Minnesota but owned by India-based Essar Group, a multinational conglomerate.
Meanwhile, the Iowa steel mill project was first introduced at the White House during a September press conference, where Trump touted his steel tariffs ahead of the contentious midterm elections.
"Now, our steel industry is roaring back to life," Trump said. "Everyone is building their place here because they don't want to pay tariffs."
The Source: This story uses information from a Mesabi Metallics press release, Lee County Board of Supervisors meeting, White House press releases, as well as reporting from Kevin Miller with Fox Television Stations. It was reported from Eden Prairie, Minnesota.