State-owned land that was proposed for an industrial sand quarry outside Kanab soon will be owned by Best Friends Animal Society under a $6.3 million deal that puts to rest a controversy that has divided the southern Utah town for a year.

Two of the parcels are in the sweeping expanse of dunes northwest of Kanab, where Southern Red Sands held mining claims on 12,000 acres of federal land. The company proposed extracting and processing sand on state inholdings surrounding a feature called Red Knoll to sell to oil and gas operators for use in fracking wells in the Uinta Basin.

Best Friends, Kane County’s largest employer and a major tourist draw, led the charge against the mine, arguing it would threaten the water supply for the 3,700-acre animal sanctuary it operates in Angel Canyon and industrialize a landscape that would best be left open. But Kanab and Kane County leaders supported the project because it would provide rural jobs and diversify the area’s economy away from a reliance on tourists. They even voted to supply the project with water.

The controversy prompted some residents to form a new environmental group called Keep Kanab Unspoiled. It included Best Friends, which had commissioned a hydrological study that found the mine could deplete the aquifer Best Friends needs to sustain its sanctuary, where 1,600 dogs, cats and other animals reside on any given day.

The impasse broke this year when Southern Red Sands dropped its mining plans, citing “economic, transportation and other logistical issues.” Best Friends then bought out Southern Red Sands’ mineral claims on the federal land and began negotiating the purchase of 1,637 state-owned acres to ensure no one else would try to mine sand there in the future, said Best Friends CEO Julie Castle.

The mining company had leased this land from the Utah School and Institutional Trust Lands Administration, which was to get a cut of the proceeds on the 700,000 tons of sand the company planned to extract each year. At its April 9 meeting, the SITLA board signed off on the sale, which cancels those leases and transfers the land to Best Friends.

(Leah Hogsten | Tribune file photo) Best Friends Animal Sanctuary is located in Angel Canyon near Kanab.

The animal organization has no uses in mind for the land other than keeping a mine off it.

“It’s a defensive move to protect the sanctuary,” Castle said. “We don’t intend to block any grazing. Ultimately, we want to be a good partner to the community.”

She considered the sanctuary the "heart and soul" of her nonprofit organization, which has a national membership numbering in the millions. Mining sand on Red Knoll was seen as an "existential threat" to Best Friends' mission.

One of the three parcels sold was not part of the mine project but rather is located at the sanctuary’s southern entrance and had already been used by Best Friends under a lease.

Some see this outcome as a win-win, with SITLA earning a tidy sum to deposit in Utah’s school endowment and the land getting spared from development. The timing has proved particularly propitious for Southern Red Sands because demand for frack sand is now expected to evaporate due to the coronavirus-induced crash in oil prices that has slowed the pace of drilling across the country.

“Had we known COVID was coming,” Castle said, “we probably would have just sat on our hands, but, at end of the day, that industry will probably rebound."

The sales price, which was reached without the customary competitive auction, exceeds what the land would have fetched on the open market, said SITLA Executive Director David Ure. The sale was advertised, but no competing offers came in.

“We didn’t have it appraised. We are above an appraisal price by quite a ways,” Ure told his board. “We have both driven a hard bargain back and forth, but I believe it preserves [Best Friends'] mission statement on preserving the animals in that area. It’s the largest animal sanctuary in the country. They are doing a very good cause.”

In the deal, SITLA retained the land’s mineral rights but agreed not to disturb the surface if it ever extracts any minerals that might be there.

“We don’t believe there is anything there right now, but we have reserved our mineral rights in accordance with state law,” Ure said. Best Friends has held grazing privileges on the land it is buying and had previously acquired another 440 acres of state land at a SITLA auction in 2005 for $2.6 million.

(Photo courtesy of Best Friends Animal Society) Best Friends Animal Society has purchased 1,637 acres of trust lands that had been proposed for a sand mine at Red Knoll, pictured here outside Kanab. The $6.3 million deal will prevent the land from being mined, which could pose a threat to the society's famous animal sanctuary nearby.

Devoted to finding homes for unwanted and abandoned pets, Best Friends spent about $200 million last year on its programs, administration and fundraising, according to its financial disclosures. Thousands of visitors volunteer at the Kanab sanctuary, caring for the animals and learning about Best Friends’ “no kill” mission for handling homeless pets.

In addition to the sanctuary, it operates "lifesaving centers" in Salt Lake City, Atlanta, New York and Los Angeles.

The sanctuary employs 675 people, supporting a payroll worth $22.5 million, according to Castle. An economic analysis has concluded it generates $43 million in economic activity for Kane County and $8.6 million in annual tax revenues.

Best Friends is now a crucial economic driver for Kane County, outpacing agriculture and extraction by wide margins. Its opposition to the sand mine spurred ill will among some residents who saw it as a barrier to job creation in traditional rural industries.

Best Friends executives, however, stressed their opposition was premised not just on self-interest, but also on Kanab’s future prosperity.

“We want to help the local economy grow,” Castle said. “We don’t want to be a roadblock to it.”