STATE COMPARATIVE ANALYSIS

Mid Iowa Growth Partnership (MIGP) contracted Wilson Tax and Business Consulting (WTBC) to provide a detailed tax and cost of business analysis as it relates to various selected states:  Illinois, Minnesota and South Dakota. The cities selected for the study were strategically selected based on various factors including location to major roadways, population and similar business climates.  Iowa Falls, IA was compared to Rochelle, IL, Owatonna, MN and Brandon, SD.  Three business scenarios were applied to the study. These scenarios were based on three main target industries:  Light Manufacturing, Renewable Energy and Agricultural Manufacturing.  Factors analyzed include Income Tax, Sales Tax, Unemployment and Workers Compensation, Property Tax, Utilities, Building and Land Costs, Tax Credits and Incentives and Wage Comparison.

Summary of Findings

Light Manufacturing:  Iowa has the lowest annual costs of doing business for a light manufacturing company with 100 employees. The annual costs of doing business in Iowa is approximately $150,000 less than Owatonna, $250,000 less than Brandon and $350,000 less than Rochelle.  The one-time net costs for Iowa Falls are clearly an advantage over the other three localities. The training dollars and having three programs that appear accessible are the primary reason for the separation. The one-time net costs are the building and land costs minus the credits and incentives. Since they are not recurring on an annual basis, they are looked at separately from the annual costs.

Renewable Energy:  Iowa has the lowest annual costs of doing business for a renewable energy company with 50 employees. The annual costs of doing business in Iowa are approximately $150,000 less than the other three localities used in this analysis.  The one-time net costs in Iowa clearly are better than the other three locations. The training dollars and having three programs that appear accessible are the primary reason for the separation.

Agricultural Manufacturing:  As the companies get smaller, the amounts will narrow as far as the comparison. However, Iowa is still slightly better when comparing the cost of doing business between the three localities.  The cost savings for Iowa is almost double when comparing the other states in this analysis. The training dollars and having three programs that appear accessible are the primary reason for the separation, and is obvious in all three scenarios.