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Layoffs last month were expected to cut the production workforce at Maytag’s washer/dryer factory to about 1,000. The company’s takeover by rival Whirlpool Corp., which may put headquarters jobs at risk, is still under federal review by antitrust lawyers. City leaders have pursued a new motor speedway, expected to open this year, and other ventures to strengthen the local economy.

Then in February, the Newton Development Corp. unveiled an even bigger idea: To draw families to Newton, pay some or all of the college tuition for graduates of Newton High School, using a mix of tax money and private donations.
 

Education Offers Way to Combat Globalization

Kim Didier

In February, the Newton Development Corporation presented the City Council a bold new economic-development proposal — the Newton Promise, a private/public partnership that would provide college scholarships to all qualifying Newton High School graduates.

The Newton Promise would make available up to 100 percent tuition scholarships to Iowa’s three state universities and community colleges or an equivalent amount to apply toward tuition at a private college in Iowa.

The idea behind the Newton Promise is simple. It stems from the belief that there is a direct correlation between a community’s educational system, its overall vitality and its economic success.

Our sole purpose at the Newton Development Corp. is to focus on economic development in the greater Newton area. That’s why when the idea for the Newton Promise, modeled after the Kalamazoo Promise, was first presented to us, the wheels started turning. Here is an opportunity — and a bold one at that — to distinguish our community as a preferred location to raise a family, start an entrepreneurial venture, expand an existing business and locate new companies.

As Newton faces the direct impact of globalization and subsequent changes to the manufacturing landscape, we recognize that simply offering money to corporations to locate in Newton isn’t a guarantee of success. Other job-hungry communities are making such offers. While we have so much to offer with our skilled workforce, developed infrastructure and beautiful facilities, the fight to win business often ends with companies going to the community with the deepest pockets.

The Newton Development Corp. and others in our community have gone through the process of envisioning our community with the Newton Promise, and we believe it has the opportunity to provide a positive, exponential effect by retaining and attracting a high-quality workforce that cares about education. Here are some of the direct benefits we believe will result from the Newton Promise:

• Current residents choose to remain living in Newton through the transition at Maytag, providing stability even during a period of uncertainty.

• New residents move to Newton even if their employment is outside Newton, which translates to an increase in housing demand and new housing starts.

• A strengthened housing market will increase property values and the city’s tax base, which means lower property taxes for all.

• Increased student enrollment will re-energize the Newton school system. With more students, additional state and federal aid will be available for the Newton school district.

• A compelling school system will generate a community with the ability to keep and attract a high-quality workforce that cares about education.

• A growing Newton will be more successful than ever at supporting existing businesses and attracting new business.

• All of these lead to a thriving community and a great place to live, work and play!

Funding the Newton Promise program is no small task. It’s going to take both private and public funds to make it a reality. The good news is that Newton has a strong tradition of private/public partnerships that result in meeting the needs of the community.

In “The World is Flat,” Thomas L. Friedman contends that the way to meet the challenge of globalization head-on is through the education of our children and the creation of a highly qualified workforce. We believe the Newton Promise is the means by which our community will not only survive the direct impact of globalization, but thrive as a result of it.
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Kim Didier is executive director of Newton Development Corp.

Little flat-out opposition to the proposed Newton Promise has been expressed, but there are questions and doubts. "It's a good idea, but..." seems to be a common expression. Among the questions:

• Shouldn't it be entirely privately funded, like the Kalamazoo, Mich., program that inspired the Newton idea?

• Would it be right to use city tax money, since the school district stretches beyond the city's borders?

• Is it fair that the scholarships would not be available to Newton graduates who want to attend out-of-state colleges?

• Shouldn't families pay for their own children's college expenses?

• Can the promise be sustained in the future as tuition costs rise and, presumably, enrollment in Newton schools increases?

A March 28 referendum on whether to impose a local-option sales tax in Newton has become embroiled in the Newton Promise proposal, although city officials have tried to keep the issues separate.

The vote on the sales tax was set before the Newton Promise was proposed. The City Council adopted a resolution on March 10 declaring that, if voters approve the tax, none of the proceeds from it or any other public funds will be spent on the Newton Promise in the 2006-07 fiscal year.

That doesn't preclude the possibility of using some of the sales-tax revenue in future years.

As originally proposed, the city would be asked to issue $5 million in bonds to kick-start the program, while $2 million per year in private donations would be raised for two years, followed by $500,000 per year thereafter. Later, the school district would be asked to contribute $1.5 million per year from the local-option sales tax for schools.

The proposed financing was based on an estimated 154 Newton graduates applying for tuition assistance each year.

Mayor Chaz Allen said recently the city is waiting to receive a detailed request from Newton Promise before making any commitment. At that point, he said, the city will evaluate the plan like any other economic-development proposal that comes to the council.

Graduates must have attended Newton schools four years to be eligible. The amount of the grant would depend on the number of years attending. Those attending kindergarten through grade 12 in Newton would get 100 percent of tuition paid.

• For more information on the Newton Promise and Newton, see NewtonPromise.com.

• Information about the Kalamazoo, Mich., program is available at kalamazoopromise.com.

• The Newton City Council resolution regarding the use of local-option sales tax revenue can be downloaded at newtongov.org. Contact information for city officials is also available on that site.