The Iowa Economic Development Authority (IEDA) has a new ESOP initiative program. According to the IEDA website:
“In addition to the general economic benefits, the IEDA believes that ESOPs are a promising tool for retaining businesses in Iowa communities. Across the state, there are businesses that have been operated in local communities for many years by owners committed to the welfare of the community. But when those owners wish to retire or to start a new business, they often need to sell the business. It can be a great thing for the community if the business is sold to the employees, through an ESOP, rather than to an out-of-state buyer that may shift jobs and profits out of the community. For these reasons, the State of Iowa recently passed two pieces of ESOP-related legislation.”
The ESOP Association’s Iowa/Nebraska Chapter recently hosted an ESOP Professional Roundtable where this initiative was a topic of discussion. Additional information can be found on the IEDA website including information about the ESOP formation assistance program which will help Iowa companies interested in ESOPs to defray the costs of the feasibility study.
“This is very positive evidence of a cost effective state program to promote ESOPs,” said ESOP Association President, J. Michael Keeling. “It’s very encouraging to see states considering programs to facilitate ESOP creation; clearly more state officers are seeing the benefits that employee-owned companies bring to the local economy. Iowa is certainly a leader on the local ESOP front — kudos to our Iowa Chapter leaders.”