Salt Lake County is poised to put its good financial name — and AAA bond rating — behind a $105 million plan to double research space at the University of Utah’s Huntsman Cancer Institute.
Mayor Ben McAdams will ask the County Council on Tuesday to authorize issuance of a tax-exempt “conduit bond” in that amount so the Huntsman Cancer Foundation may get funding upfront to build a 220,000-square-foot research facility dedicated to studying childhood cancer.
The bond will be repaid with pledges secured by the foundation, McAdams said, and will not require use of any county tax money.
“This is an investment that will not cost the taxpayer anything” while providing high-paying jobs for the community and increasing its prestige as a center in the fight against disease, he added. “I’m honored that Salt Lake County can play a role in bringing this project to fruition.”
Industrialist Jon Huntsman Sr., a four-time cancer survivor who founded the institute in 1995 with a family gift of $125 million, announced plans for the expansion Nov. 1. He hopes to begin construction next year.
The Huntsman family is providing about half of the money for the facility, which will be known as The Primary Children’s and Families’ Research Center. The rest is coming from individual donors and large contributors, such as The Church of Jesus Christ of Latter-day Saints and the family foundation of former U. basketball coach Rick Majerus.
In a letter to the county’s Debt Review Committee, which pulls together top financial people from various divisions of county government, Foundation President and CEO David Huntsman said pledges of $80.5 million have been secured already.
One of Jon Huntsman Sr.’s sons (and younger brother of former Utah Gov. Jon Huntsman), David Huntsman added that the Legislature has provided $2.5 million so far and is expected to come up with another $17.5 million for the building, which will be wholly owned by the state.
The Debt Review Committee unanimously endorsed the bond request.
“The money is essentially in place,” McAdams said, but since it will take a decade to collect all of the pledges, bonding allows the institute to borrow the money right away, begin facility construction and repay the county on a schedule set by bondholders.
“Because we made smart financial choices in the past, we’re in a position to do this now,” he said. “We have a triple-A bond rating and our debt ratio is low so we have some capacity [to bond]. … This will support an incredibly important facility that will benefit the residents of Salt Lake County and the whole state.”
During the past 18 years, David Huntsman said his family has contributed $400 million to the institute and helped raise an additional $1 billion. About 125,000 patient visits are expected this year at the facility, which employs about 1,300 people earning an average of $80,000 annually (wages and benefits). The expanded research effort will create 300 jobs providing comparable compensation.
“For every dollar spent on cancer research at [Huntsman Cancer Institute], an additional $2.30 is generated for the local economy through out-of-state grant and contract resources,” Huntsman added.
A proposed bond issuance for the Huntsman Cancer Institute expansion will be discussed at the Salt Lake County Council’s 9 a.m. work session in Room 2003 of the North Building of the County Government Center, 2001 S. State. A formal decision is expected at a 4 p.m. meeting in the first-floor council chambers.