(The Lena Dunham character on the show (Hannah) got into the Iowa writing program, which the real-life Lena Dunham attended.)
The linked article has quotes from Josh Schamberger, director of Iowa City/Coralville Area Conventions & Visitors Bureau:
"Gosh, can you imagine the economic impact of having HBO film crews staying in hotel rooms and bringing a greater awareness of Iowa as the best of the best, especially to a younger audience? You can’t buy that sort of exposure."The ped mall! Seriously! Iowa! The opportunity you are missing! America could witness the ped mall. I could attain greater awareness of Iowa. Schamberger seems like some guy character on the show — another one of the guys who get dirty looks from Hannah.
“It’s unlike any place in the country... I think it would be cool to see the Iowa City campus and the ped mall” on the show.
ADDED: I think the school made the right decision. They have this high-prestige writing program, and they can't subordinate the students' experience to the interests of the show. They owe it to their students not to succumb to the glamour and mystique of HBO. The students think very highly of themselves and the honor they have attending the Iowa Writer's Program. What would they think — what would they write — if their short time in the program were handed over to a TV show? Maybe some would squee. Others would — and should — feel contempt and hostility. This is not the program that brought me to Iowa. You sold out to pop culture.