Keokuk plant spends $27M for remodeling

Jun 23, 2010 — The Hawk Eye

Rex L. Troute

Jun. 11, 2010 (McClatchy-Tribune Regional News delivered by Newstex) -- KEOKUK -- Roquette America Inc. announced Thursday it will spend $27 million to remodel the feed house of its Keokuk corn gluten feed plant, the same building responsible for a $1 million fine the company paid in February.

The Iowa Department of Economic Development awarded Roquette tax benefits Thursday through the High Quality Jobs Program to support the remodeling project.

The feed house, where animal feed is made from byproducts of corn processing, was cited for exceeding air pollution emission limits under existing permits for particulate matter, nitrogen oxides, sulfur dioxide, volatile compounds and carbon monoxide.

Iowa Attorney General Tom Miller filed a lawsuit on behalf of the Iowa Department of Natural Resources stating Roquette did not implement required "best available control technology," and obtain a Prevention of Significant Deterioration permit when it made major plant modifications. The increased pollution emissions came from several natural gas dryers in the feed house.

"The fine resolved the past issues so we could move on," said Aliza Golan, spokesperson for Roquette in Keokuk.

Roquette already had paid the $1 million fine by the time of the Feb. 16 press release and agreed to modernize the present feed house.

"The planned investment includes the installation of new, state-of-the-art dryers incorporating the best available control technology and other environmental enhancements," said Dominique Taret, president and CEO of Roquette America Inc. back in February.

The modernization of the feed house will comply with the "new feed house stipulation" in an agreement between the state and Roquette. Taret said the project could reduce emissions by 50 percent. Operations in the feed house will continue while the new technology is brought in during the remodeling project.

"This is another example of Roquette maintaining and expanding our operation and remaining committed to Keokuk," Golan said.

To qualify for the tax benefits of the High Quality Jobs Program, Roquette had to meet wage threshold requirements. Kay Snyder, with the Iowa Department of Economic Development, said the average wage at Roquette must be 130 percent of the average wage in Lee County to meet the standards of the program, which in this case meant an hourly wage of $20.13. Roquette employs roughly 500 people at its Keokuk plant, with 48 of those employees working in the feed house.

The total value of the tax benefits package to Roquette is $2,529,850. The largest portion of the package is an investment tax credit of $1,890,000, which is 7 percent of the $27 million remodel price tag. Also included is a doubled research and development tax credit of $471,250, plus $168,600 as a refund of sales, service or taxes paid during construction.

No timeline has been set for when the upgrade will start or when it will be completed. Roquette is in the process of obtaining the necessary permits for the project.

Newstex ID: KRTB-1064-46372362