Governor Pence Suspends State's Role in Posey Count Economic Development Project

Press Release

Governor Mike Pence suspended state support for the construction of a nitrogenous fertilizer manufacturing plant in Posey County in light of federal concerns.

Shortly after his inauguration on Jan. 14, Gov. Pence instructed the Indiana Economic Development Corporation (IEDC) to halt the project with the Midwest Fertilizer Corp. of the Fatima Group, pending further investigation. The action came immediately after the governor learned that the U.S. Department of Defense (DOD) considered Fatima Group less than cooperative with the department's efforts to eliminate improvised explosive devices (IEDs) in Central and South Asia.

"Economic development is important, but the safety and security of our troops in harm's way is more important," said Pence. "We're in the process of making a careful evaluation of the appropriateness of Indiana's involvement in this project with those priorities in mind."

The IEDC informed Fatima of the project's deferment via a letter dated Jan. 15, 2013. The letter can be read in full here. The state also began actively investigating the situation in consultation with federal authorities and the DOD at that time.

When the IEDC began working with Fatima Group last summer, the DOD had described Fatima's role as supportive, and said the company was cooperating with federal authorities. The company is not currently listed on the federal government's banned Entity List, and its executives are not prevented from travel to the United States.

On Jan. 12, the IEDC learned that the DOD's position had changed dramatically. The IEDC was informed of recent testimony from Lt. Gen. Michael Barbero, the director of the DOD's Joint Improvised Explosive Device Defeat Organization, before a subcommittee of the U.S. Senate Foreign Relations Committee where he testified that Fatima was less than cooperative with the department's efforts in the region.

"When Fatima initially approached the IEDC with their plans to create hundreds of new jobs and invest more than $1 billion in Indiana, we were thrilled. At the time, the DOD described the company's level of cooperation addressing issues as supportive," said Eric Doden, president of the IEDC. "However, as soon as we learned of the DOD's significant change in position, the state paused the project until a thorough investigation can be completed."

The Ports of Indiana and Indiana Finance Authority have also been involved in the project.

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