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Despite a tumultuous economy, the state provided nearly $33 million in direct incentives to dozens of Iowa companies seeking to expand in 2009.

However, dozens of other companies that had received awards in previous years also came before the Iowa Economic Development Board in 2009 to seek contract extensions or negotiate repayment agreements. State officials say they don’t expect a big increase in companies changing their expansion plans, though.

The board awarded $32.7 million from the Grow Iowa Values Fund to 52 companies in calendar year 2009, according to a review of press releases issued by the Iowa Department of Economic Development (IDED).

IBM Corp. received the largest Values Fund award in 2009, $11.7 million for its $93 million technology services center in Dubuque. The company has pledged to create 1,300 high-paying technical jobs in Eastern Iowa.

Awards to agricultural or bioscience-related projects garnered some of the largest awards in 2009. Among those was the biggest award to a Greater Des Moines company in 2009, $1 million to Johnston-based Pioneer Hi-Bred International Inc. for an expansion of its crop research facilities. (see table for other Central Iowa awards)

Created by the Legislature in 2003, the Grow Iowa Values Fund was born on July 1, 2003, with an initial four-year, $100 million pool of funds. The majority of those funds were set aside to provide direct economic development incentives to compete with other states for lucrative projects.

According to the IDED’s fiscal 2008 report, the department funded a total of 553 projects through the Values Fund from its inception through June 30, 2008, with direct awards to companies totaling more than $124.3 million. Of those, 337 projects were active and had reported creating nearly 24,000 new jobs.

Nineteen projects were in collections as of June 2008; those companies had received more than $6.7 million in awards from the state, of which approximately $3.5 million had been collected.

According to a review of 2009 board agendas, 76 companies sought some type of revision to their contracts over the past year. Of those: 33 sought contract amendments; 14 requested termination of approved awards; 13 sought settlement offers on amounts in collections; and nine requested extensions of their contract periods. Also, four companies requested rule waivers, and three asked for amended award amounts.

Kay Snyder, an IDED spokeswoman, said a rule change in July now brings these requests to the board rather than the director, but that IDED hasn’t seen and doesn’t anticipate a big influx of companies changing their plans and seeking contract revisions.

One of the companies seeking more time to fulfill its contract is Hershey Systems Inc., which in October 2005 received a $400,000 loan from the Values Fund after pledging to create 70 new technology jobs in Des Moines.

Hershey, which has filled just four of the pledged jobs, is seeking a 24-month contract extension. President Ron Christian said he had to initially recruit from outside the state because he couldn’t find people with the technical skills needed in Iowa. Each of the six people he recruited has since moved to other Greater Des Moines software companies, he said. Also, because it no longer assembles the products itself, it won’t need as many employees.

“It’s not so much an economic factor,” Christian said. “In fact, the company is having the best year it’s ever had.” He expects to end 2009 with 10 employees in Des Moines and double that figure in the next year.

“Obviously, we’re going to pay every dime back, that’s first and foremost,” he said. “I believe small software companies like Hershey are good for the state of Iowa.”