Iowa has authorized $1.36 billion in tax incentives for a $15 billion steel mill project, moving the legislation from special session to signature in a single day. Governor Kim Reynolds signed House File 2801 on Friday, Oct. 2, just hours after lawmakers approved it, according to the Des Moines Register. The law took effect immediately.

The Iowa House passed the bill 75-17; the Senate approved it 28-19. Lawmakers had convened at 8:30 a.m., and Reynolds signed before 9 p.m.

"Today's special session advances the most consequential economic development ever to come to our state," Reynolds said in a statement.

What does the law change?

The amendment modifies Iowa's Major Economic Growth Attraction program, established in 2024 to compete for development projects exceeding $1 billion. As originally enacted, MEGA allowed tax incentives of up to 5% each for two eligible businesses. The amendment lets the state combine the two slots into one, allowing a single business investing in a rural area to claim up to 10% of its investment over 10 years.

Senator Jeff Reichman, a Republican, told a Senate Ways and Means Committee hearing that nobody had used the two original sites. He confirmed Lee County as the mill's location and called the project a "game-changer" for the state.

Who is building the mill?

The project is led by Mesabi Metallics, a Minnesota-based iron ore mining company owned by India's Essar Group. President Donald Trump announced the multi-billion-dollar project last Monday, calling it the "largest steel plant in American history."

Once operational, the company expects the facility to employ at least 1,750 people and produce low-emissions steel using direct-reduced iron and electric arc furnace technologies. Feedstock will include scrap steel and iron ore from Mesabi's recently opened mine in Nashwauk, Minnesota.

Reynolds called the special session Tuesday, the day after Trump's announcement, for the sole purpose of amending MEGA to support the deal.

"Higher wages attract workforce, strengthen local businesses, and grow communities," Reynolds said. "This opportunity will accelerate the economic trajectory of our state, and our country, for generations."

Why did some lawmakers object?

Supporters described the project as a "once-in-a-lifetime" opportunity. Several Republicans and Democrats disagreed with the pace. They argued the approval process was rushed for an investment of this size and skipped public discussion or debate.

"No input, no opportunity for an input," Senator Tony Bisignano, a Democrat, said during Friday's committee hearing. "I can't rejoice because I don't know what it is and no one that came today gave us or gave me really confidence."

Reichman said the deal had been "simmering" under a non-disclosure agreement since last year and gained momentum in August.

The Sierra Club urged lawmakers to reject the incentives. "There is no question that this subsidy is being rammed through the legislature with very little consideration of the costs, benefits, requests or any other details," the environmental group wrote in a blog post last week.

The production plan remains an announced intention, not a confirmed capacity schedule: no commissioning date, tonnage target or construction timeline accompanied the announcement. What to watch next is a formal groundbreaking date for the Lee County site, detailed capacity and hiring milestones from Mesabi, and how the state structures the 10% payout against actual investment.