torms and flooding during the spring and summer of 2008 displaced about 40,000 Iowans and caused billions of dollars in damage. The recovery will take years, but companies are already finding new opportunities.
      One such firm is Reel Deal, a holding company for Phantom EFX, the leading developer of PC-based casino and card video games; Barmuda, a multi-unit restaurant and lounge company; and Tactical 8 Technologies, a Web-based company specializing in the financial sector. When the Cedar River reached flood stage last June, it displaced Phantom and Barmuda, which were in the same building in Cedar Falls.
      "We lost our 74,000-square-foot [6,975-sq.-m.] headquarters in the flood," says Darin Beck, chairman of Reel Deal. "We decided it wasn't a good idea to rebuild in the same place and possibly lose it all again in another flood. So we began working with the city, and we will be moving into a 56,000-square-foot [5,202-sq.-m.] blended office and distribution facility with all three companies."
      Reel Deal broke ground on the building to be known as Phantom Park, in the Cedar Falls Industrial Park, in September 2008. Beck says he expects it to be fully occupied by July 2009. Beck has an ownership stake in all three companies.
      "The city stepped up to the plate and helped with a grant to buy the building, and is helping us relocate to the technology park in exchange for us abandoning the old property and deeding it to the city for park space," he says. "A lot of residents are still displaced and businesses lost. Some are closed and won't reopen. We were in an old industrial area near the river that went under water. Everyone moved out of the area or went out of business."
      Reel Deal, which is investing US$5.2 million in the project, also received a $250,000 grant from the Iowa Economic Development Board. Reel Deal employs approximately 100 people, but Beck says the company is in expansion mode and the new building will accommodate growth.
      "We will be adding people if the economy turns around, and we are building our building as if it will," Beck says.
      Iowa is not listed among the top clusters of video game development, but Phantom EFX has emerged as a leader in its field. Beck says a couple of friends wanted to start a video game company in 1998 and by 2000 it had become a full-blown video game publisher.
      "We were dumb enough that we didn't know that you aren't supposed to make video games in Iowa," Beck says. "We are a very strange company in that we are doing cutting edge work in a state not normally associated with the video game industry. But Best Buy is our largest customer and they are only two and a half hours away in Minneapolis."
      The Technology Association of Iowa recently gave Phantom its Prometheus Award for the Medium to Large Software Company of the Year.
      "We have been successful in getting people to locate here from the U.K. and California," Beck says. "We've really had no problem. There is a great little quality of life here – we just try not to interview during January or February if we can help it. The cost of living is low here, you can buy a lot more house for less money, and there's little traffic."
      The Waterloo-Cedar Falls metropolitan was one of 20 U.S. metropolitan areas with unemployment rates lower than 5 percent in February. The area's jobless rate matched the State of Iowa's rate at 4.9 percent. Iowa was one of only five states with unemployment rates lower than 5 percent. Iowa's governor Chet Culver attributes the relatively low jobless numbers to the resilience and toughness of Iowans and a preference to look forward. Nevertheless, the recovery effort will affect the state's economy far into the future.
      Culver says Iowa has secured more than $1.5 billion in state and federal funds for the rebuilding effort. That effort has involved working with 20 federal agencies and 16 state agencies to leverage as much funding as possible. The total includes nearly $250 million in state funding so far.
      "I feel good about our efforts in working with the Small Business Administration, FEMA and HUD to get the funding we need," Culver says. "But that's not going to be enough, and we will continue to make flood recovery our top priority. The bottom line is this was the fifth worst natural disaster in U.S. history, causing $1.1 billion in infrastructure damage. That's just public infrastructure like courthouses, public roads, water and sewer, and public works buildings, dikes and levees. It's going to take years to rebuild, but the process is under way and we are moving forward to rebuild about half of our state."
      Culver spoke with Site Selection on the morning of April 1 as he was en route to groundbreaking ceremonies for NextEra Energy Resources' $20-million repair facility for wind turbine electrical generation equipment. NextEra, the largest wind and solar energy producer in North America, is a subsidiary of FPL Group, and operates seven wind farms in Iowa. The repair facility will be built by expanding an existing building in Story City, about 40 miles (64 km.) north of Des Moines. It will employ 20 to 25.
      "It's a very exciting day and another step forward in our goal of becoming the country's renewable energy center," says Culver, who wants to see more wind farms in the state as well. In addition, he says, Iowa is focusing not only on the manufacturing of components for wind turbines (as evidenced by the presence of six major companies in the state – Acciona, Siemens, Clipper, Hendricks, TPI and Trinity), but is also working on getting wind power to consumers.
      "We must also invest in the grid so we can move that power across the state and perhaps across the region. With that kind of focus, I believe we will attract more companies to Iowa, not only manufacturers of component parts, but the whole supply chain. It's very exciting, and it's all happened pretty much during the last two years."
      Iowa's other major economic success story of late has been in the IT sector, with Microsoft, IBM and Google all bringing major projects to the state. Microsoft put the brakes on a planned $500-million data center in Des Moines in January as part of a company-wide cost-cutting measure, but Culver remains optimistic the project will eventually go forward. He met with Microsoft officials in Washington State on March 30.
      "We were given a commitment that it's not a matter of 'if,' but a question of 'when,' so the fact is that it's clearly a priority for Microsoft, and that is very reassuring," says Culver.
      Congressional Quarterly Press ranks Iowa second in quality-of-life issues, behind Wyoming, citing safe neighborhoods, a top education system and a strong healthcare system. Culver says that backs up what companies experience when they come to the state.
      "If there is one reason more and more companies are looking at Iowa, it's pretty simple – our quality of life is literally one of the best in the nation," he says. "Most companies will tell you those are the types of things their employees are looking for, and it's tougher and tougher to find."