Iowa City Council Committee Recommends $1.2 Million in Tax Breaks for Biotechnology Company

Strategic Insights -

The Iowa City Council Economic Development Committee recommended providing up to $1.2 million in tax breaks to National Genecular Institute Inc., a biotechnology company planning to create nearly 200 jobs in the Technology Corridor. The company's facility, a 20,000-square-foot "biobank" in Northgate Corporate Park, would be one of only a few of its kind in the world, housing hundreds of thousands of samples of genetic and cellular material. The company's plans include expanding to 35 acres next to the Iowa City site, potentially bringing another 100 jobs.

Key Takeaways:

  • The City Council Economic Development Committee recommended approving up to $1.2 million in tax breaks for National Genecular Institute Inc. over seven years through tax increment financing.
  • The company's facility, a 20,000-square-foot "biobank" in Northgate Corporate Park, would cost between $5.5 million and $6 million to build.
  • The facility would employ 176 people after three years, with 36 jobs in Iowa City paying at least $14.70 an hour as part of the TIF agreement.
  • The company is planning to buy 35 acres next to the Iowa City site for future expansion, which could bring another 100 jobs.
  • National Genecular Institute Inc. is the research-and-development subsidiary of Dermacia, a California-based company specializing in pharmaceuticals and skin care for anti-aging and post-surgery treatments.
  • The company is considering sites in four other states, but Iowa City/Coralville is its top choice for the state funding comes through due to the proximity to the University of Iowa and University Hospitals.
  • The Coralville City Council approved an $800,000 loan to NGI for a 55,000-square-foot building at the UI's Oakdale Research Park, which would house wet lab space to be shared with the UI.
  • NGI hopes to have the Coralville and Iowa City buildings open by May 2008.

Statistics:

  • Up to $1.2 million in tax breaks for National Genecular Institute Inc. over seven years
  • 176 people employed after three years
  • 36 jobs in Iowa City paying at least $14.70 an hour
  • 20,000-square-foot "biobank" in Northgate Corporate Park
  • $5.5 million to $6 million to build the facility
  • 35 acres next to the Iowa City site for future expansion
  • Potential for another 100 jobs

Sources:

  • The Gazette
  • GazetteOnline.com
  • Dermacia (National Genecular Institute Inc.'s parent company)
  • University of Iowa
  • University Hospitals
  • City of Coralville
  • State of Iowa