SALT LAKE CITY — A project that would radically reshape downtown Salt Lake City with a “sports, entertainment, cultural and convention district” surrounding a renovated Delta Center has cleared its first major hurdle.
The Salt Lake City Council voted unanimously Tuesday to approve a partnership agreement with Smith Entertainment Group, the principal owner of the Utah Jazz and Utah Hockey Club, on a downtown revitalization plan. The vote sends the proposed 136-page document to a state committee for approval before the deal can be finalized.
If the deal is finalized, the City Council will vote later this year on whether to approve a 0.5 percent sales tax increase and proposed zoning changes to accommodate the plan’s development.
“This is a good deal that brings good things to the city,” Salt Lake City Council President Victoria Petro said before the meeting. “As we move forward on this, I feel sorry for people who feel against it and are afraid, but I’ve moved from fear to determination. … It’s scary and it’s important, but it’s in the best interest of the state.”
The vote didn’t come as much of a surprise, as all the suspense leading up to it was dispelled during the city council’s work session before Tuesday’s official meeting. Petro said the city council would vote in favor of the measure in an impassioned speech to his colleagues.
The City Council vote included a lengthy notice of “legislative intent,” which outlines goals the City Council would like to see in the deal but does not constitute binding conditions. That could dictate future discussions about the deal.
In this case, the City Council is directing city staff to develop “financing options” for infrastructure improvements in Japantown. It would also like to establish mitigation and construction planning processes for the entire district, as well as prioritize transit development in the district by potentially establishing a “tickets as fares” program with the Utah Transit Authority.
In a joint statement, Salt Lake City Mayor Erin Mendenhall and Smith Entertainment Group project director Mike Maughan called the vote “a strong endorsement and positive step toward” the project.
The vote marks the first major milestone for the project since Smith Entertainment Group filed for a partnership with Salt Lake City on April 4, shortly before Ryan and Ashley Smith acquired the Arizona Coyotes in a deal that relocated the team to Utah. The partnership opportunity was created by a bill passed by the Utah Legislature in March.
“We are grateful for (the City Council’s) support of this vision that will create a more active, connected and family-friendly future for Salt Lake City,” the statement read in part.
Take a decision
The two sides have been negotiating since April, culminating in a final agreement that was released Friday. Under the agreement, Smith Entertainment Group can apply for up to $900 million in bonds for the renovation of the Delta Center and other projects in the district.
Smith Entertainment Group’s plan would focus primarily around the Delta Center and the two blocks east of it, which would house a shopping center, hotel and high-rise residential buildings. A larger area surrounding those blocks, including The Gateway, would make up the remainder of the revitalization area.
The company would receive most of the proposed sales tax increase to cover the cost of the bonds over the next 30 years. Those projects are expected to be completed around 2034.
In return, the city would introduce a new entrance fee that would go into a city account that funds affordable housing projects throughout the city. Other city benefits include new internships, job shadowing and apprenticeship programs for high school and college students, more youth programs and free or subsidized tickets for Salt Lake City-based community organizations.
Some of the money would also be earmarked for the renovation of the historic Japantown district.
If our downtown dies…it reflects in all sorts of ways on our local economy, as it attracts new businesses and good-paying jobs.
–Alejandro Puy, Salt Lake City Councilman
But the project also sparked all sorts of reactions for and against at two public hearings in May and June, which drew more than 100 comments. While several downtown business leaders spoke in favor of the project — saying it could provide a “boost” to neighborhood businesses — many residents also spoke out against it.
Some called it a “waste,” while others questioned why a billionaire needed taxpayer money to carry out the project. Also Tuesday, a group called Americans for Prosperity-Utah held a small protest outside the Salt Lake City County building before the meeting.
“It’s not the government’s job to raise taxes on (Salt Lake City) taxpayers and then subsidize someone else’s expensive entertainment,” said Kevin Greene, who helped organize the protest.
City council members spoke of “countless hours” of meetings and debate over the terms of the deal before Tuesday’s vote. Councilman Alejandro Puy added that difficult discussions took place during that time, including over measures to exempt groceries from any potential sales tax increase.
Ultimately, Puy said his colleagues agreed that the idea of redeveloping downtown, including the possibility of reopening 100 South that remains covered by the Salt Palace Convention Center, was too good to pass up. It’s those kinds of changes that city officials say could help the city’s plan work, when other stadium deals have fallen through.
“The success of downtown is the success of every neighborhood in the city,” he said. “If our downtown dies … it reflects in all sorts of ways on our local economy because it attracts new businesses and good-paying jobs.”
The next steps
The district redistricting process is far from over, even with Tuesday’s vote.
Salt Lake County properties, including the Salt Palace, Abravanel Hall and the Utah Museum of Contemporary Art, are not included in the deal. The fate of those properties will be determined by separate agreements between the county and Smith Entertainment Group. County leaders have said they would like to preserve Abravanel Hall, but it appears the museum could be torn down and rebuilt.
The deal is contingent in part on Smith Entertainment Group securing a lease with the county by mid-2025.
In the meantime, Mendenhall said she expects the agreement to go to the state Revitalization Area Committee for review Wednesday. That will trigger a 30-day period during which the committee will vote to accept or reject it, providing Salt Lake City and Smith with notes on what it would like to change.
City leaders have been told the committee is aware of the agreement document, but they are unsure what direction the committee might take.
Meanwhile, other items remain on the Salt Lake City Council’s agenda. The council is scheduled to hold a public hearing Aug. 13 on proposed zoning changes related to the project, which could open the door to buildings as tall as 600 feet. It’s not yet clear when it will vote on the proposal or the 0.5 percent sales tax increase.
“There’s a lot of work to do,” Mendenhall said. “We’re going to continue to work together.”
Contributing: Mike Headrick