The Utah Transit Authority waded through years of scandals with “transit-oriented developments” near train stations, ranging from awarding sweetheart deals to developer friends of board members to builders inviting board members who voted for their projects to invest in them.
Now, the new UTA board — which was recently restructured by the Legislature in part because of those scandals — says it has reformed rules to prevent such problems and is seeking permission from lawmakers to partner in many more such projects.
Some legislators and city mayors are excitedly backing the move, saying it may be a way to solve a lack of affordable housing along the Wasatch Front and boost transit ridership at the same time.
In transit-oriented developments, or TODs, UTA offers vacant land that it owns near transit stops for partnerships with private developers for new business and residential projects. They are designed to help increase transit ridership and provide some revenue for UTA.
State law now limits UTA to participating in no more than eight TODs at a time, which it is currently doing.
UTA board members last week told the Legislature’s Transportation Interim Committee they would like to participate in many more — and support raising or eliminating the current cap.
They reported that cities along the Wasatch Front are clamoring for more TODs — and are currently seeking as many as 18 of them — but state law prevents the agency from pursuing them.
“There is a lot of other opportunities throughout our entire region that can benefit from transit-oriented development,” UTA board member Beth Holbrook told the committee.
UTA Board Chairman Carlton Christensen acknowledged, “There have been a few missteps along the way, and UTA frankly has paid a price for that. But those have been corrected, and the processes have been improved substantially.”
To prevent more scandals, he said, UTA now requires review by more groups before approval of projects — including working with cities and a UTA advisory board. It has set up a system to rank potential projects with objective criteria.
Mark Shepherd, mayor of Clearfield, where UTA just approved partnering in one of the last available TODs under the cap, told lawmakers that until recently “I probably would have never in my life said ‘expand this process’ ” because of problems before recent reform at the agency.
“The difference in transparency now is night and day,” he said. “We know exactly what’s going on. The general public knows what’s going on.”
West Jordan Mayor Jim Riding said the new UTA board chose not to include a project his city sought among the final TODs it had available. “But you know what? The program that they put together in determining those is very fair” and should lead to trust if TODs are expanded.
He added that sites around rail stations usually are appropriate for affordable high-density housing, which may face more opposition elsewhere.
“So we’re trying to encourage the Legislature to eliminate that cap,” he said, “so that cities like us can participate with UTA in trying to improve and create that density in a location where it makes sense.”
Sen. Gregg Buxton, R-Roy, supported allowing more TODs.
“We are maintaining the cap on something that really is in the way at a time, especially now, when we are in such a crisis with housing,” he said.
Others questioned why UTA would not just sell such land and get the transit agency out of the development business.
“The problem with that is if you were to sell their properties, now they don’t develop necessarily in the way that they need to develop,” Riding said, adding continued UTA ownership would help the agency ensure projects are designed to increase ridership.
But Sen. Wayne Harper, R-Taylorsville, co-chairman of the committee, said lawmakers should carefully consider whether that is an appropriate development tool.
The committee voted to start drafting a bill that may raise the cap on TODs and said it will continue to look more closely at the matter.
Some of the past controversies about UTA transit-oriented developments include:
• A 2014 state audit criticized UTA for prepaying a developer, Jeff Vitek, $10 million to construct a parking garage — which it turns out he never built — just after he made a multimillion-dollar deal benefiting then-UTA board member Terry Diehl. It said the agency never got all the money back.
• The audit complained Vitek was chosen for another TOD even though he refused to supply required financial information. It found the resulting deal “unduly favored the developer” and was “far out of market.”
• In 2017, UTA made a deal to avoid federal prosecution by cooperating in a criminal probe into former UTA board members and others concerning possible misuse of taxpayer funds and development around train stations. Diehl later faced related charges, but all were eventually dismissed.
• UTA spent $15.6 million to build two large parking garages at the Jordan Valley TRAX station, which for years then sat mostly empty. They were erected largely to help serve an adjacent TOD, which ran into problems and was delayed.
• UTA cut ties with developer Thackeray Garn, an early partner on seven TODs, after the agency discovered the company had invited two former UTA board members — Chris Bleak and Sheldon Killpack — to invest in a hotel at a TOD that they had voted to approve.