House approves bill limiting public incentives for retail projects, with narrow exceptions

The Utah House passed House Bill 151 on Feb. 18, a measure that curtails the use of public funds for retail facility development while listing several narrowly drawn exceptions.

Representative Schultz, who moved to uncircle the first substitute of HB151, told colleagues the bill "is that public entities, that's state, local, RDA authorities, cannot provide public funds, sale[s] which is sales tax or property tax revenue for the development, construction, renovation, or operation of a retail facility." He said the provision would not apply where the retail component is ancillary to other uses and described a suite of exemptions included in the bill.

The bill’s exceptions, as explained on the floor, include public infrastructure that serves the community at large, structured parking, demolition, main-street and historic-preservation programs, general business programs, water conservation, emergency assistance, and public-safety programs. Schultz said redevelopment agencies retain exemptions for demolition and environmental mitigation. He also said cities may offer limited retail incentives when they are tied to a housing component: at least 10% of those housing units must qualify as moderate-income under the city's housing plan and incentives tied to the project may only be used for those moderate-income units.

Supporters on the floor described the bill as the result of a working-group process. Representative Schultz said the measure "came out of the economic opportunity task force and others" and reflected efforts to "reign in some of the incentives given to businesses." Representative Briscoe urged support calling the measure "an improvement over our current policy," and Representative Stankwist described it as "a great step" to realign incentives away from cities competing for sales tax revenue.

Floor debate was limited; the sponsor thanked stakeholders including the League of Cities and the Governor's Office of Economic Opportunity for working on the language. The bill was scheduled to take effect on 07/01/2022, per the sponsor.

Voting opened and concluded on the House floor. The clerk announced, "For substitute House Bill 151, passes the House, with 66 yes votes and 0 no votes," and the measure was forwarded to the Senate for consideration.

The bill will now be considered by the Senate; no Senate action or amendments are recorded in this transcript.