Iowa Rain Forest Latest Snag in Energy Measure

Posted November 11, 2003 at 5:46pm

While the energy bill is already stalled over tax issues, the conference committee has also hit a snag over a nasty dispute sparked by Senate Finance Chairman Chuck Grassley’s (R) effort to build a rain forest in the middle of Iowa.

House and Senate aides said progress was made on the almost $20 billion tax portion of the energy legislation this past weekend, but not enough to free it from conference committee. As a result, House leaders canceled floor votes for the week.

In a session with reporters late last week, Speaker Dennis Hastert (R-Ill.) placed the blame on Grassley. “Right now we’re hung up over a pork project in Iowa,” Hastert said.

While some people may have thought Hastert was referring to Grassley’s long support for ethanol, a House GOP leadership aide said the Speaker was actually talking about a provision Grassley inserted in conference that would help build the Iowa Environmental/Educational Project — formerly named Iowa Child.

Senior House GOP aides threatened that House negotiators were willing to bag the entire tax portion of the bill and move just the energy boosting elements to the House and Senate floors if Grassley did not budge on the project.

“This is it: At some point in time you’ve got to say ‘enough is enough,’” said one GOP aide.

That prompted Grassley spokeswoman Jill Gerber to shoot back on Friday: “It seems like an idle threat. It also seems petty that they won’t allow Iowa an environmental and educational project but they’ll allow commercial development in four other states.”

Fed up with being painted as an obstinate conferee holding out for a pork project all weekend long, Grassley fired off a memo late Monday afternoon denying that he was to blame for the energy holdup.

“Last week, the House leadership said the Iowa green design project alone is holding up the whole bill,” Grassley stated. “That wasn’t the case last week and it isn’t the case this week.

“The House leadership received bad information,” Grassley said, adding that differences over tax credits for the nuclear, coal and nonconventional fuel industries remain.

At issue is a project that Grassley’s office says would cost taxpayers $70 million — but House sources insist could total $130 million — to build a massive educational and environmentally friendly tourist site just off Interstate 80 in Coralville, just outside Iowa City.

Supporters want to build a 20-story translucent dome that will house a rain forest, aquarium and classroom on the prairie. The habitat will be sustained by a system that will recapture the 30 million gallons of rain that fall on the 4.6-acre area annually, according to a project description.

Despite the complaints, not too much was known about the Iowa project. An explanation can be found at www.iowachild.org, along with this description from former Iowa Gov. Bob Ray (R): “In addition to its ecological core and galleries devoted to Iowa’s native prairies, geology and agriculture, it will have 60,000 square feet for classroom, computer and lab facilities — but it will be more than a learning center. It will be loaded with arts and cultural attributes, similar to the United Kingdom’s stunning Eden Project.”

A separate provision in the energy bill to provide $350 million in “green bonds” for environmentally friendly developments was also added to the conference report but seems to be drawing less ire from the House.

That’s because it contains a competitive process by which projects are selected for the bonds, whereas Grassley’s provision is written so narrowly it could only benefit the Iowa project, knowledgeable sources said.

Gerber maintains that position is inconsistent, as Grassley’s project has an educational purpose whereas the others being promoted — such as ones in Georgia, New York, Colorado and Louisiana — are commercial and residential real estate ventures.

While the threat of dumping the tax portion over the Iowa project seems to have been withdrawn with both sides pledging to craft a final report as soon as possible, it apparently left a bad taste in Grassley’s mouth.

“There are five green design projects,” Grassley said. “Several Members representing those states support their home-state projects. If the House insists on authorizing only the four for-profit projects, and not the Iowa nonprofit project, I’m willing to recede to the original House position of dropping them all. But authorizing all of the projects except for the Iowa project, as the House wanted at one point, is wrong and unfair.”

The rain forest controversy is just the latest battle between Grassley and House Ways and Means Chairman Bill Thomas (R-Calif.), who have been locked in contentious negotiations on major legislation all year.

After finishing the $350 billion tax and growth package this spring, Grassley and Thomas had to delve into devising tax cuts for a new energy policy and figuring out how to add a prescription drug component to the Medicare program.

While barbs were exchanged across the Capitol last week, Gerber said Hastert never directly told Grassley that he had a problem with the Iowa project.

“We didn’t think it was a controversial issue until the Speaker raised it,” she said. “If the Speaker has a serious problem about it, he’d talk to us.”

Hastert spokesman John Feehery said his boss’ position was clear.

“People know the Speaker’s position,” Feehery said. “It’s been clearly articulated.”

While the focus was on Grassley’s home state project, no one seemed to make much noise about the “green bonds” that could fund building projects elsewhere in the country as part of the final energy package.

For example, developers in Shreveport, La., want to build the Louisiana Riverwalk, an “urban renewal, brownfield reclamation project located on a former industrial site,” according to its project overview.

It is set to include “two new resort-style hotels, retail shopping, restaurants, professional office space, multiplex cinema” and other attractions, the document states.

In Lakewood, Colo., developers are champing at the bit to create “Belmar” on a plot that used to boast a shopping mall in downtown Lakewood. The $750 million project will be mixed use, with 1 million square feet for retail space and 800,000 square feet for office space and 1,300 residential units.

In Atlanta, a local developer wants the green bonds tax break to help launch the Atlantic Station, another mixed-use development to be built on the former Atlantic Steel Mill.

Finally there is Destiny USA in Syracuse, N.Y., a resort that its backers think will become “the preferred destination resort in North America.”

The project developers, though not guaranteed to win funding even if the green bond provision becomes law, have been lobbying hard for “green bond” legislation.

Grassley said officials at the Treasury Department and the Environmental Protection Agency would select projects based on merit.