Bill pushes plan to convert northwest Salt Lake City into an international trade hub — but city slams it as a power grab for overriding local zoning, taxing control

(Al Hartmann | The Salt Lake Tribune) Trucks with trailers dump their loads of 40-45 tons of fill dirt on the new state prison site Tuesday Feb. 27. Graders follow behind to smooth the new fill dirt in. No repeat this 300 to 350 time a day. The fill project is about a week from completion at the new prison site northwest of Salt Lake City and state and city leaders are hoping to use road and utility line improvements as an anchor for converting the area into an international trade hub.

The framework for an international trade hub in Salt Lake City that could deliver a tax windfall to Utah and redraw how overseas goods move into and around the Western United States is now in draft form in the state Capitol in a bill that the host city’s officials quickly denounced for usurping their control over taxing and zoning.

Introduced Tuesday by Sen. Jerry Stevenson, R-Layton, with broad legislative support including House and Senate leadership, SB234 would create a self-governing agency with authority to administer an area covering more than 38 square miles in northwest Salt Lake City. The area, roughly one-third the city’s total size, runs from the city’s northern and western boundaries south to 2100 South and east to Interstate 215, excluding the Salt Lake City International Airport.

The area includes all of the city’s Northwest Quadrant development area, which city officials last month designated to receive special tax financing to spur growth.

The new “Utah Inland Port Authority” would create a foreign trade zone and develop an actual port of entry facility somewhere within its jurisdiction that would accept and process inbound and outbound overseas cargo and goods, bypassing coastal entry ports and expediting inland delivery.

Arriving in Utah by rail, and transported from there by rail and truck to destinations across the country, cargo moving through the facility would make the state an intermodal hub for goods moving in both directions, attracting shipping and logistics companies and other supply chain-related businesses. Already, Amazon is building a $200 million regional fulfillment center in the area, and UPS expects to open a $275 million regional operations hub there late this year.

The northwest quadrant was also chosen as the site for the state’s new prison — bringing new roads and public utilities to the area — improvements that could kickstart commercial development.

“This is a big deal to the state of Utah. It’s very important for the future economic development of the state,” Stevenson told reporters at the Capitol Tuesday. The authority board, he said, “has the job of going out and making the inland port idea work across the country, and across the world, really.”

But the bill came down hard on city officials who, through recent zoning and development decisions, have sought to position Salt Lake as ready and able to develop such a port facility on its own. Since the latest port proposal surfaced earlier this year, city officials have advocated for more of a contractual relationship with the state for creating one.

The inland port concept has existed in one form or another since at least the early 1990s, taking on new momentum this session, with House Speaker Greg Hughes formally presenting the plan on Feb. 1.

Since then the city has lobbied and worked with the state to at least preserve a measure of control over the port’s development, acceding to arguments that an independent authority comprising all levels of government would be better suited to the project. The proposed legislation, city officials said, contains none of their proposals.

(Francisco Kjolseth | The Salt Lake Tribune) Mayor Jackie Biskupski holds a presser at the City County building on Tuesday, Feb. 27, 2018, to speak out against SB234 as written, which creates the Utah Inland Port Authority, saying it deprives the city of local control in taxing and land use decisions.

“Our ideas aren’t in the bill,” Mayor Jackie Biskupski told reporters Wednesday. “We said we would work together on a bill, but we were never brought to the table in the crafting of this bill. And when it was released, the language in it obviously was surprising.”

While the bill specifies that the new authority “does not have and may not exercise” land use control over the area, it also sets up its board as the appeal of last resort for zoning decisions within its boundaries. That means property owners or other stakeholders could appeal city zoning decisions to the port authority board.

The bill also proposes that the new authority take five percent of any area-specific tax increment financing, such as that just authorized by the city. Biskupski said a figure of tenth that amount — 0.5 percent — was more appropriate.

The authority’s nine-member board would have two members each appointed by the governor and Salt Lake City’s mayor; one member each appointed by the House and Senate leaders, the City Council, and the Salt Lake County mayor; and the chairman of the state Permanent Community Impact Fund board.The county’s economic development director would serve as a non-voting member.

Biskupski said the draft bill “strips ultimate land use authority” from Salt Lake City for an area larger than most of Utah’s cities and cedes it to a board with minimal city representation that “has no accountability to the people that live here.” It “creates a dangerous precedent in which the state could enact similar legislation and quickly take over land use authority of other cities,” she said.

The mayor and City Council Chairwoman Erin Mendenhall raised the city’s concerns with the bill sponsor Tuesday. As a result of those talks, the mayor said, a scheduled Wednesday Senate committee hearing on the bill is being postponed. Biskupski said she was “very hopeful” the bill will be rewritten to address the city’s concerns.

The City Council has scheduled a special work session on the proposed legislation Wednesday afternoon.

“The city has serious concerns about core municipal functions that would be altered under that draft bill,” Mendenhall said. “This would set a precedent for every municipality in the state that has economic development potential to lose their land use authority.”