In a last minute move, a state committee approved an updated map of areas included in the taxpayer-funded overhaul of downtown, despite efforts to delay the vote by Salt Lake City officials — who said they didn’t know about the potential changes until the day before.
A state board under the Governor’s Office of Economic Opportunity, or GOEO, voted 9-4 to adopt a plan that would dedicate 100% of property tax from the Salt Palace and Delta Center over the next 30 years toward rebuilding the convention center, as well as building a new entertainment district between the two sites.
The plan also calls to dedicate the “full amount of sales and tax use increment as allowed by code” from within that area to fund the redevelopment, according to the motion voted on by the board. The area poised for redevelopment is known as the Convention Center Reinvestment Zone, or CCRZ.
Originally, the Delta Center and Salt Palace were the only properties slated to be a part of the CCRZ. But an updated map shown Friday now includes an area to the south, which the board referred to as Block 67, though it’s also been dubbed the West Quarter project.
That block is between 100 South and 200 South, as well as between 300 West and 200 West. The new addition brings the land total of the CCRZ up to 49.92 acres.
Block 67 includes a luxury apartment building and a pair of hotels, and the area is also slated for further redevelopment in the coming years. The Block 67 addition to the CCRZ does not include the cultural buildings along Japantown Street, including the Salt Lake Buddhist Temple and the Japanese Church of Christ.
Blake Thomas, Mayor Erin Mendenhall’s senior advisor on real estate and capital projects, said during the Friday meeting that city officials didn’t receive the updated map with Block 67 until Thursday and didn’t receive updated financial figures until Friday morning.
Thomas said he was not aware of the pro forma behind the projected tax revenue figures, and he wanted more time to review the projections before voting on the changes, as the adjusted numbers could have a significant impact in Salt Lake City’s budget.
“Absent knowing what informed the new numbers as of hours ago, absent a budget cap, it’s really unclear what we’re voting on and what the implications are,” Thomas said. Despite his worries, Thomas emphasized the city is excited and supportive of the project.
Councilmember Dan Dugan said making last minute changes is a disservice to Salt Lake City taxpayers, adding that while the funds would be spent in the capital city alone, he still has unanswered questions.
“It would be nice to see eyes wide open on how much money is going to be spent, and how much is this,” Dugan said. “Is it really $1.8 (billion), or is it more? Yes, you’re right, it’s going to be spent in Salt Lake City, but this is our taxpayer money, and this is the same money that we would usually spend on public safety, on our parks, on our roads and our other infrastructure.”
State leaders and a Smith Entertainment Group executive argued delaying the vote would only create issues, as the state must move forward on the project in order to meet the deadlines outlined in Senate Bill 26, which made this type of redevelopment possible.
“I’m very sympathetic to the desire to have more time, and I think there’s valid reasons for doing that,” Rep. James Dunnigan, SB 26’s House sponsor, said Friday. “But … what does that change? And honestly, I don’t think it changes much.”
State leaders argued that adding Block 67 would bolster the amount of tax funds that could go toward the redevelopment.
“I appreciate GOEO adding this into there, as it substantially increases the revenue for the benefit of the CCRZ and takes away some of those questions that we have about financing and bonding with that additional revenue,” said Sen. Kirk Cullimore during the Friday meeting.
Ryan Ritchie, founder and principal of the Ritchie Group, which is a co-owner of the Block 67 properties, said Friday he intends to help fill gaps in infrastructure, and he plans on working closely with Salt Lake County, which must approve any use of CCRZ funds before they are doled out.
“We have to work with (Salt Lake) County provide infrastructure, and that is our intent, is to try to provide the additional infrastructure, one from the loss that they have by demoing the west annex — the west side of the convention center — and then there’s some additional parking that we’ll have available for that as well,” Ritchie said.
Ritchie has been waiting for clarity around the Delta Center revitalization before he moves ahead with the next phase of his development in the West Quarter, which was initially expected to include a high-rise office building.
GOEO estimates that the Salt Palace rebuild will cost around $1.27 billion, and changes to Abravanell Hall, the Utah Museum of Contemporary Art and the East Block Plaza would cost around $229.2 million.
The tax funds dedicated to the CCRZ wouldn’t go toward renovations inside the Delta Center, but Mike Maughan, an SEG executive, said the arena is on a tight schedule to start renovations, which is slated to start on April 18 after the Jazz and Utah Hockey Club seasons end. (The Utah Hockey Club hasn’t yet been eliminated from playoff contention, though it is highly unlikely to reach the playoffs.)
“We have very limited windows, and when I say we’re down and scheduled to the very hour, we’re scheduled to the very hour,” Maughan said. “So any delays can put that in some difficulty.”
Earlier this week, Salt Lake City Council members took public comment on a measure that would create a public infrastructure district to fund the area’s redevelopment, with some council members bemoaning how the process didn’t really factor public opinion and seemed predestined for approval due to conditions imposed by the state legislature. The council is slated to vote Tuesday on the resolution.
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