This article originally appeared in the Nov. 26, 2017 edition of the Ames Tribune.

DowDuPont’s $225 million cellulosic ethanol plant remains mostly empty weeks after the chemicals giant shut down the plant. The company’s departure from the region was sudden and swift, but the long-term implications reach across the region, from the bottom lines of farmers hoping to diversify their income to the Nevada city budget.

Stover contracts

The Tribune previously reported DowDuPont had contracted with about 500 farmers in the region to provide 275,000 tons of stover, the crop material left over from a harvest that is used to produce cellulosic ethanol.

However, the company halted collection in 2016 after reaching full capacity in its storage.

Andy Moser, the owner of a baling company in Nevada, had a contract with DowDuPont to run a baling crew. He said his net pay was around $12,000 per baler crew for three months of work per year.

One year, he had about 15 employees working part-time and was able to pay them about $5,000 each per year.

“That was awesome for them, because that’s money for Christmas,” he said. “They can spend all that money on Christmas. It worked out slick.”

Moser said he has other revenue streams to keep him afloat, but he knows of other local balers and out-of-state crews that focused solely on getting bales to the plant and now must figure out another way to make money.

“The timing was not very good,” he said. “Either before harvest or after harvest would have been okay, but not right in the middle of it … if they would have pulled the pin beforehand, they could have planned better.”

Brian Sampson, a Nevada farmer, also had a contract to provide stover for the plant. He estimated the stover contract was worth about 10 percent to 15 percent of his revenue two years ago, the last time the plant collected stover.

Initially, Sampson was hopeful on selling his stover to the plant, viewing it as another revenue stream for his operation.

“I was very confident, optimistic, looked forward to it,” he said. “We weren’t going to get rich off of selling stover, but it was just another added little thing we were going to take advantage of.”

Sampson said he’s diversified his production between corn, soybeans and cattle, so he isn’t suddenly rushing to find a new buyer for his stover.

But without the plant’s demand for stover, local farmers had less of an incentive to farm corn in back-to-back seasons, a process that reduces farmer tilling time, keeps more nutrients in the ground and reduces soil erosion.

“Adding money in my pocket, that wasn’t a big thing,” Sampson said. “But I thought it was a good value-added thing in our area, and I’m disappointed in it not working.”

Tax abatements

State and local officials pledged a total of nearly $15 million to the project in 2010, according to documents from the Iowa Economic Development Authority. The state agency granted DowDuPont a $5 million forgivable loan and $586,000 in job training funds back when Dow and DuPont hadn’t begun merger discussions.

The city offered $8.6 million in tax abatements over 10 years as a match to state support, with a 75 percent abatement in the first year, 60 percent in the second and 50 percent abatement until the tenth year of operation.

According to property records, the plant’s net tax bill before local abatements is just over $1.3 million a year since the assessor started levying taxes in 2014.