After initially balking at a compromise that would spare Anderson's Salt Lake City constituents a tax increase or cut in services, legislators relented Wednesday, the second day of the 2005 special session, setting aside $4 million in state money for the $80 million project.

"This is not a single-city issue or a single-county issue," said Kamas Republican Rep. David Ure. "The Salt Palace helps every county in this state. This pays for our kids in schools. It pays for our roads. It pays for Corrections. I just don't think we can afford not to fund it."

In other action, legislators agreed to bond for $4.5 million to build a veterans nursing home in Ogden and set aside $1.4 million to set up a drug treatment pilot program for inmates in Salt Lake County.

Lawmakers plucked the $4 million for the Salt Palace expansion from a bill allocating $18 million over two years to promote Utah tourism. The money will be replaced with surplus funds.

Under an interlocal agreement pounded out at a meeting of Salt Lake County, city and state leaders earlier this month, the county will pay $66.2 million, the largest portion of the cost. The city will chip in $8 million from its "innkeeper tax." And Sandy will contribute $1.8 million raised from a 50-cent surcharge on South Towne Expo center event tickets. The budget includes building a parking garage at the expo center.

Without state funding, Salt Lake City leaders were considering drastic cuts in services, a tax increase, or not paying for the Salt Palace project at all - putting the expansion at risk.

"We were really headed for a nightmare scenario," said Salt Lake City Councilman Dave Buhler. "Happy or not, they did the right thing. It is a fair deal."

In a letter to lawmakers, Gov. Jon Huntsman Jr. urged legislators to approve the funding to fulfill its commitments and contracts. "The Salt Palace expansion is about jobs, economic competitiveness, and showcasing the state of Utah as a premiere tourism and business destination," he wrote.

And during lunchtime caucus meetings, legislative leaders used a little reason and a little guilt to prod Republican lawmakers hostile to the project because Salt Lake City's outspoken Democratic mayor is involved.

House Speaker Greg Curtis told conservative legislators the state probably would be the biggest beneficiary of any increased tourism spurred by a larger convention center. He noted Utah collects nearly $5 from every $100 hotel bill. In 1991, the state paid $15 million for the first Salt Palace expansion. The expanded Salt Palace is projected to raise an additional $2 million in state tax revenue each year.

Curtis urged his colleagues to rise above partisan or personal conflicts with Salt Lake City's mayor.

"I love to poke sticks and kick cowpies as much as anyone," said Curtis. "But sometimes, you need to make a policy decision regardless of the person involved."

That high-minded ideal didn't stop the inevitable grousing on the House floor when Anderson's name was mentioned.

Rep. Mike Noel, R-Kanab, blamed Anderson for costing state taxpayers $250 million by participating in a lawsuit that delayed construction of the Legacy Highway. Rep. John Mathis, R-Naples, refused to vote for the funding because environmentalists - members of the Outdoor Retailers Association - who come to conventions at the Salt Palace have tried to stop oil shale development in the Uinta Basin.

And smarting from his own tax bill, Rep. Jim Ferrin, R-Orem, argued that lawmakers were investing others' money in a fancy new building. "If we really want to invest in economic development, I don't think it's the Salt Palace or a baseball diamond or a soccer field. I think it's jobs that create wealth."

But economic development interests persuaded most lawmakers to support the bill. Sponsoring Rep. Dave Clark, R-Santa Clara, called the Salt Palace an "economic generator."

Taking pains to avoid mentioning Anderson's name, Sen. Mike Waddoups, R-Taylorsville, said, "From a business point of view, this is an excellent investment. This was not about personalities or politics."

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Tribune reporter Thomas Burr contributed to this report.