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Tax Structure Approved for Proposed Iowa Speedway

Sat April 23, 2005 - Midwest Edition
Construction Equipment Guide

DES MOINES, IA (AP) The Iowa House approved tax incentives for the proposed Newton Speedway, a NASCAR-style track to be built along Interstate 80 in Newton.

Under the measure, the first $12.5 million in sales taxes collected by the track would be rebated.

Rep. Danny Carroll, R-Grinnell, said the track could bring Iowa a new tourism destination, with as many as 40 percent of those attending the races coming from outside the state.

“I don’t think it would come as a surprise to anyone that auto racing is one of the fastest growing sports in this country,” Carroll said.

Backers said Newton badly needs an economic development boost because of job losses at the Maytag Corp. plants.

“We’ve had some misfortunes lately in losing some jobs,” said Rep. Paul Bell, D-Newton. “This would be a good shot in the arm.”

The House approved the measure on an 80-18 vote, sending it to the Senate where approval also is likely.

Current plans project the track’s construction cost anywhere from $60 million to $72 million. A group of Iowa investors has come together to help finance the track and NASCAR driver Rusty Wallace is slated to serve on the board overseeing the facility.

If the project falls through, the state doesn’t lose anything, Carroll said, but if the project goes forward “this is a significant opportunity to provide a boost to the central part of the state.”

Bell said city officials have stepped forward to support the project, committing $9.7 to streets and services and $3.3 million for the land.

“We are fully behind this,” said Bell.

Critics said lawmakers once again went blindly jumping after an economic development proposal.

“Sometimes we’re like a litter of kittens up here,’ said Rep. Ed Fallon, D-Des Moines.

Rep. Robert Hogg, D-Cedar Rapids, said lawmakers were once again crossing the line and meddling in private developments.

“We are not an investment firm,” said Hogg. “We shouldn’t be investing in businesses like this.”

Gov. Tom Vilsack has backed development of the track, but has raised questions about financing it with the sales tax rebate. He suggested that a direct grant would be more appropriate.

He declined to say whether he would sign the bill or not, once it reaches his desk, but said “we’re going to continue to look very closely at all tax proposals.”

Backers of the measure said a separate measure would call for a review of the effectiveness of using the sales tax rebate as an economic development tool.

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