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Utah gets a peek at business incentives
This is an archived article that was published on sltrib.com in 2006, and information in the article may be outdated. It is provided only for personal research purposes and may not be reprinted.

In a limited attempt to be more open about how they are spending taxpayer money, the Governor's Board of Economic Development on Friday revealed it is offering $750,000 in incentives to ViraCon Inc., an architectural glass maker that is considering putting a plant in Washington County.

Revealing the company's name before it has committed to place a facility in the St. George area represents a departure from long-standing board practice that kept such information secret from taxpayers, even if the company was willing to talk publicly about its plans.

The Salt Lake Tribune has filed open-records requests for details about the millions of dollars secretly offered to companies in the past year or so. The state has denied those requests, although Gov. Jon Huntsman Jr. in an interview with The Tribune two weeks ago pledged to make the process more open.

Board member Dell Loy Hansen, who was sitting in as chairman of the meeting on Friday, lamented having to be open about how taxpayer dollars are spent, stating that in the long run it could cost the state jobs.

"We're trying to be the most saintly people possible," Hansen said, contending that the board's policy has been to be open with the public. "But saints get killed and devils win."

Utah is competing for the ViraCon facility with Tuscon, Ariz., which is offering some $4 million in incentives to land the plant.

Although the board almost always knows what other states are offering companies - most competing states are far more open about their incentive programs than Utah - Hansen said if Utah's offers to companies get out, that would put this state at a competitive disadvantage. (It is common practice for companies to tell their suitor states what their rivals are offering.)

"Do we want to tell everyone we're competing against how bad we're losing?" he asked. "In openness our competitors gain an advantage."

That said, Hansen acknowledged that Utah would not be losing anything in this instance, because the state appears to have the inside track on landing the ViraCon facility. And board member Jerry Oldroyd noted that even though Utah might be at a disadvantage in trying to lure companies to the state when it comes to dollar-for-dollar spending on incentives, there are other benefits, such as access to a major airport, that make Utah appealing.

ViraCon, a subsidiary of the Minneapolis-based Apogee Enterprises Inc., expects to hire up to 250 employees for the plant and pay entry-level workers $23,920 a year. Those wages will represent 117 percent of the median salary in Washington County.

"We expect to make a decision fairly soon," Apogee spokeswoman Mary Ann Jackson said Friday. "Our goal is to have a new plant operating by March or April of next year."

In regard to the board's penchant for secrecy, Mike Nelson, director of incentives and recruitment for the state, said much of it is based on policies put into place years earlier. He noted that the board's Web site right up front instructs companies interested in negotiating economic development incentives to file a statement that they don't want their names disclosed.

ViraCon filed such a statement. But Nelson said when he recently contacted the company and ViraCon officials expressed their willingness to reveal their plans publicly, he asked a ViraCon executive why they had requested nondisclosure in the first place.

"He said it was because we [Utah] had asked for it," Nelson told board members.

The board's move toward more disclosure is going only so far.

Board members on Friday also approved up to $2.5 million in incentives to lure a food services distributor to expand into Cache County. The company and its proposed expansion - identified by the state only as "Project Elvis" - could bring upward of 200 jobs to the Logan area.

Listing incentive recipients only by project name has been the board's long-standing practice. And on Friday it refused to provide any other details about Project Elvis.

steve@sltrib.com

Economic development: The process of luring businesses to the state is still far from open
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