IEDC representatives Mark Wasky (left) and Brock Herr defend their agency’s decisions during questioning from Rep. Ed DeLaney at a Tuesday, June 11, 2024 meeting of the State Budget Committee. (Leslie Bonilla Muñiz/Indiana Capital Chronicle)
The Indiana Economic Development Corp. (IEDC) on Tuesday won approval to spend about $59 million buying Boone County acreage already under contract for a massive industrial park.
The quasi-public agency will use funds “repurposed” from a stalled deal to fill gaps in ownership. An additional $29 million will be used for area infrastructure improvements.
Three unnamed companies — in advanced computing, biopharmaceutical manufacturing and information technology component manufacturing and — have expressed interest in building at LEAP, according to the State Budget Committee agenda.
IEDC officials were on defense over an hour of intense questioning.
Rep. Ed DeLaney, an Indianapolis Democrat, asked why IEDC needed more land: “So, the 9,000 acres was not enough?”
IEDC Senior Vice President Mark Wasky said the land buys would be part of that total. “Some” acres are “within the site” envisioned for the Limitless Exploration/Advanced Pace (LEAP) Innovation District, he added.
“You have holes in that? … You’re trying to close that off?” DeLaney asked.
Wasky said the IEDC needed control of the land “in order to make the investments work.”
That’s despite not having “an accepted commitment” from the firms, said Brock Herr, IEDC’s senior vice president of business retention, expansion and attractions.
IEDC would spend about $500,000 on options on 1,400 new acres of land. It would use $58.5 million to buy 1,100 acres of land already under contract.
That averages out to more than $53,000 per acre — lower than the $88,000 Wasky said the IEDC has paid on average for LEAP land.
The money isn’t new.
The State Budget Committee, during a December meeting, approved $100 million to lure an advanced manufacturing project, dubbed Project Nora, to Indiana.
But that deal hasn’t come together — yet.
“It has not disappeared. Due to company and industry changes, they have delayed a decision,” Herr said. “We were very candid and clear with that company that it had an expiration date, should the project not proceed. … The funds would be de-obligated and potentially repurposed, which is what we’re here today to do.”
Wasky said the IEDC learned it should wait to seek State Budget Committee funding approval until agreements are finalized.
“The company made clear that they needed to have the confidence, and having all the legal approvals taken care of, before they made a final decision,” he added.
DeLaney said the company “didn’t have the confidence it should’ve had” in December. He said he wanted to “learn from this mistake … so we don’t do that again.”
Water worries reemerge
Skeptical lawmakers also pinned IEDC officials on water supply for LEAP.
Indiana has targeted advanced manufacturing firms for the district, like semiconductors and batteries, but they’re water-intensive industries.
Wasky, during further questioning from DeLaney, said an initial investment phase by homegrown pharmaceutical giant Eli Lilly & Co. “essentially has brought the capacity of Lebanon Utilities to its fullest.”
Lilly in 2022 said it would spend $2.1 billion into a project on 600 acres of land, but increased that to $3.7 billion at the groundbreaking in 2023.
Last month, the company added a whopping $5.3 billion — for a total of $9 billion — all on the original 600-acre lot.
Asked about projected water need on non-Lilly land, Wasky said, “We’ve been in discussion with water utilities about capacity they can bring to the area, and it’s … somewhere between 10 and 25 million gallons a day from existing water resources.”
But as other companies join LEAP, water need could increase, he said.
Across current and prospective companies, and when operating at full capacity in 18 to 20 years, LEAP could need as much as 55 to 60 million gallons of water per day, according to Herr. He said most would be “non-contact” — or used for cooling.
The state hoped to pipe up to 100 million gallons of water a day from the Wabash River in Tippecanoe County to LEAP, but residents have pushed back.
The IEDC, in early results from a study, claimed there was enough water to support the diversion. Still, Gov. Eric Holcomb directed the Indiana Finance Authority to take over the study and widen it for a more comprehensive examination.
Preliminary data were expected in late spring or summer, but IEDC officials indicated that the study’s not yet ready.
They also said electrical supply isn’t a concern, as long as utilities have enough time to build new capacity.
IEDC officials additionally requested to repurpose $29 million from Project Nora to use on infrastructure improvements at LEAP.
The money would go toward local road improvements, engineering and design for interchange improvements and road realignment, utility improvements and relocations and other site prep and planning efforts for infrastructure and sites within the district. It would support five projects, according to the meeting agenda.
The State Budget Committee approved requests by voice vote, in one lump adoption of the agenda. Rep. Greg Porter, who has been openly critical of the IEDC’s plans, abstained.
“I’ve never heard of a voting member abstaining from a vote on a State Budget Committee agenda. But I felt like I had to be the first one to abstain today,” Porter said in a statement. “I couldn’t move myself to vote for the agenda when I have no clue what I’m investing in. We’ve given the IEDC billions of state dollars for projects, but they’ve shared no information. We don’t know the investors, and we don’t have answers on the utility situation.”
“My goal is to protect the taxpayers and how their dollars are spent. Hoosier taxpayers deserve to know how we’re using their money,” he continued. “Once I get those answers, I’ll vote to approve a State Budget Committee agenda.”
Correction: This article’s first paragraph was updated to clarify that the purchases involve land already under contract.
By: Leslie Bonilla Muñiz - June 12, 2024