One tiny Utah county is an economic basket case, causing some to wonder if it should be absorbed by a neighbor

Utah’s tiniest county also may be its most economically endangered.

In the past three years it has suffered the shutdown of its 80-bed jail that brought in an estimated $1.5 million in state revenue each year, as well as the loss of a federal contract to provide security for Flaming Gorge Dam, and now it faces a lawsuit from one of its own towns accusing it of diverting millions of federal dollars intended for the town’s benefit.

The numbers tell the tale — and in stark terms.

County revenue this year was half what it was a year ago. It’s a third of what it was in 2016. Expenditures have similarly been slashed to the bone — down 57 percent in the three-year period.

(Christopher Cherrington | The Salt Lake Tribune)

This alarming spiral has given new currency to a question that’s been asked before: Can Daggett County survive as a separate, independent county?

“That question gets raised regularly, and I’m going to dance a little bit and say that that would be up to the public,” said County Commissioner Jack Lytle. “At this stage of the game, I think we’re OK being independent.”

Lytle, like a good portion of those with full-time employment in the county, works for a government agency — in this case the Utah Division of Wildlife Resources. Public administration is the second most-common job for Daggett residents, behind tourism, which is limited by seasons, according to state employment data.

The commissioner doesn’t call himself an optimist but a pragmatist. He says it’s going to take some “out-of-the-box” creativity to weather the financial storm and build a sustainable economy going into the future.

One unorthodox approach is the ongoing attempt to sell the county jail. The asking price is $4.4 million. Another, perhaps more forward-looking project is construction of the county’s first fiber-optic network in the towns of Manila and Dutch John. The $3 million-plus effort will initially bring high-speed internet to schools in both towns and a Manila medical clinic.

(Rick Egan | Tribune file photo) Daggett County jail near Manila, in Daggett County, on Sept. 25, 2007.

“We’re the last of two counties — us and San Juan — that haven’t had fiber optics, so we’re looking at what can come with that kind of development,” said Lytle. In the future, “we’re trying to look at home work.” Jobs that could be done remotely online are a direct attempt to overcome Daggett’s biggest challenge: its remoteness and lack of accessibility to population centers.

The county has 1,029 permanent residents, according to updated census figures, which means it’s about two-thirds the size of the state’s second least-populated county, Piute.

Meanwhile, it’s about the same distance from Manila and Dutch John to Rock Springs, Wyo., as it is to Vernal — and the trip to Vernal is on mountain roads that can be tricky in the winter.

It was that very problem of accessibility to Vernal — the Uintah County seat — that led to the creation of Daggett County a century ago. In the days of wagons, early-model cars and dirt roads, it was, for about six months of the year, impossible for a resident of the area to exercise his or her right to petition the government.

“Small in population and isolated from their fellow Utahns by rugged mountains, the people along the northern slope of the Uintas felt like political stepchildren,” according to the book “A History of Daggett County,” published by the state Historical Society and the County Commission.

After years of frustration, the final straw came when the Uintah County Commission refused to appropriate $70 to fix some mudholes in the connecting roadway, according to the history. A petition drive led to a public vote, which overwhelmingly favored separation of the area into a new county, and Daggett County officially came into existence Jan. 7, 1918.

Emotions aside, it never should have been allowed to happen, says Dave McDonald, a Dutch John town councilman.

“Daggett County, even way back in the 1900s, when it was created, didn’t really stand a chance of being a successful county. Just, financially, [leaders were] unable to find enough revenue to keep it alive,” he said.

“They have never been financially solid since. And the basis for my saying that is the county is 89 percent state and federal land. Out of the 11 percent that’s left, one ranching family owns 7 percent, and they don’t sell their land.

“So we have 4 percent of our county on which you might be able to do development work for raising up your tax base,“ he said. ”The county will never survive, it just can’t. It’s a horrible situation. The governor should never have allowed the split of Uintah County.”

McDonald and other leaders of Dutch John are currently locked in what they see as a battle of survival with Daggett County. At issue in a federal lawsuit the town filed against the county last June is continued county ownership and control of most of the land and water in Dutch John and allegations that county leaders diverted millions from federal payments meant to smooth the transition of the town from a federal installation for Flaming Gorge Dam workers to a political subdivision of the state.

County leaders deny the allegations and have asked federal Judge Dee Benson to dismiss the suit. Lytle wouldn’t discuss the pending litigation.

County Attorney Niel Lund said he’s optimistic about the outcome of the court case.

“Our argument simply is the plain language of the statute,” Lund said. “The language says that all of the property that was not sold within two years [of Dutch John’s transition from federal ownership] will be given to the county without consideration.”

Meanwhile, McDonald says, the animosity has gotten so intense that the county “had the door locks changed and locked us out of the fire station [in Dutch John]. We haven’t been able to get in for a month.”

He predicts the judge at an upcoming hearing Jan. 10 is going to look at that and say, “Why the heck did you do that?”

Lund says the fire station closure is a completely separate issue from the claims in the lawsuit.

“They want to tie it all together and see that move as revenge, but there were very legitimate reasons that were explained for shutting the doors on the fire station there.” Primarily, he said, those have to do with the liability exposure of the county because many of the volunteer firefighters won’t sign the papers required of them.

McDonald said the town is seeking ownership of all land and water in its jurisdiction and won’t try to go after the allegedly diverted federal annual payments from 1998 to 2013.

“Be realistic. … To get that judgment against a broke county, I mean what good is it?’

Daggett County’s financial straits are very much on the radar for top state leaders, said Mike Mower, Gov. Gary Herbert’s deputy chief of staff.

“We’re all very concerned about Daggett County,” he said, pointing out that Herbert has been out there at least twice in recent years. “And you know I spent more time probably driving out there in the last few years than any other single county. We’re working with local leaders on kind of what’s the long-term solution to deal with not only the jail [closure] but overall enhanced economic development.”

(Courtesy Utah Governor's Office) Gov. Gary Herbert joins with Daggett County commissioners to sign a proclamation recognizing the 100-year anniversary of the vote that authorized creation of the county, Sept. 12, 2017. The new entity became official Jan. 7, 1918.

Calling Daggett County a “hidden gem in the state … acre for acre one of Utah’s most scenic counties,” Mower said its remoteness is part of its allure but also presents obstacles to a sustainable economy.

“It’s the blessing and the curse — the blessing is it’s located, you know, far enough away from the Wasatch Front that it’s retained an idyllic rural charm. The downside is, it’s far enough away from the Wasatch Front that it’s a challenge,” he said. “You can’t commute from there to anywhere easily to work.

“It does face legitimate challenges in its proximity and size.”

(Brian Maffly | The Salt Lake Tribune) This is a view of Flaming Gorge Reservoir from Red Canyon in Daggett County. October 2018.

With Daggett’s recent economic body blows from the jail closure and the loss of the dam security contract, not to mention the ongoing fight with Dutch John, Lytle, the county commissioner, pauses when asked whether his job is a lot harder than it was when he was first elected in 2014.

“I don’t know that it’s been harder or easier — it’s not easy.

“Yeah, I mean there’s been some things that have made it a challenge to keep the budget balanced and to make it work. Absolutely,” said Lytle.

“It won’t be without work, but I think we have the people here to to figure out a way to make it work and to continue making it work.”