Utah legislator wants to limit school district tax incentives in wake of Facebook deal

Utah legislator wants to limit school district tax incentives in wake of Facebook deal

(Spenser Heaps, Deseret News)


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WEST JORDAN — Irked by the potential $240 million tax break deal to lure a Facebook data center to West Jordan, a Utah lawmaker said he plans to propose a new law that would place limitations on school district tax incentive participation.

Rep. Joel Briscoe, D-Salt Lake City, said Thursday he will propose the bill in the next legislative session, meant to "protect" school districts from deals similar to so-called Project Discus.

Briscoe joins Salt Lake County leaders in opposition to the deal, which now awaits a vote from an eight-member taxing entity committee before proceeding — though that vote, originally scheduled for Monday, will likely be postponed.

Still, the competition between West Jordan and Los Lunas, New Mexico, the other city being considered for the data center, rages on.

Thursday, the day after New Mexico approved proposals to supply electricity to a proposed Facebook data center, Utah power officials approved Rocky Mountain Power's request to service the potential data center.

As Project Discus moves on a trajectory forward, Briscoe said lawmakers need to consider measures so schoolchildren don't end up funding future corporate "giveaways."

'Lose-lose' situation?

Briscoe said the Jordan School District Board — which voted to support the deal earlier this week, despite expressing misgivings about the terms of the deal and the steep tax incentive — was placed in a "no-win situation."

"If they don't approve it, they're castigated," he said, since the data center would garner $17 million in new tax revenue over 20 years for the school district, which board members said is starving for more revenue to serve a fast-growing population of students.

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But in exchange for that $17 million, the school district would forego $94 million in 20 years in property taxes to Facebook under the tax incentive terms.

That concerns some taxpayers, especially in a year when the Jordan School District is asking taxpayers to approve a $245 million bond in the upcoming November election to help the district pay for more schools.

"I don't blame the district," he said. "They're doing what they believe they need to do. But I think there are bigger policy issues here. … We need to have a discussion about whether or not it's necessary to take dollars from school kids for economic development."

Briscoe said he doesn't know what limitations would be included in the bill, but he intends to work with school district officials to draft appropriate measures.


"I don't blame the district. They're doing what they believe they need to do. But I think there are bigger policy issues here. … We need to have a discussion about whether or not it's necessary to take dollars from school kids for economic development." — Rep. Joel Briscoe

Susan Pulsipher, president of the Jordan Board of Education, said she'd want to see exactly what limitations would be included in the bill before supporting it, but she agreed with Briscoe that the deal placed her district in a "lose-lose" scenario.

"That's extremely difficult for a district that's trying to be responsive to the public," she said. "I would welcome something that would help school districts so they don't get stuck in such a difficult situation."

Earlier this week, Jordan School Board member Matthew Young — the board's sole dissenting vote against Project Discus — criticized West Jordan for being "tone-deaf and arrogant" to the district's position.

"I wonder how we've gotten here," he said. "We are as a school district so desperate for additional funds to educate our kids, that we're willing to look at a plan that requires us to forego 85 percent of our right to property tax."

Young said Thursday school districts shouldn't be "in the business of encouraging or discouraging economic development."

"If we don't use Project Discus to have a very serious discussion, we've missed a very great opportunity," he said.

West Jordan City Manager Mark Palesh said he'd want to see the details of Briscoe's bill before commenting on it, but added tax incentive limitations could create difficulties for future economic development deals.

"If you restrict one taxing entity, you basically restrict all of them," he said.

Delayed vote

Project Discus requires a two-thirds majority to pass an eight-member taxing entity committee, which was expected to vote Monday. Since Salt Lake County officials cast two "no" votes, one more vote could stop the deal in its tracks.

However, Palesh said Monday's vote could be delayed, since the Utah Board of Education has indicated it needs more time to decide on its official position.

Emilie Wheeler, State School Board spokeswoman, said the board likely won't know when it will be making its vote until next week.

"We don't have anything scheduled right now," she said. "We're operating under the assumption that the meeting Monday will be postponed."

State School Board Chairman David Crandall has said the board will not take a position on the deal before it has solid information on the state tax incentive the deal would require and what its impacts would be.

He said the board's staff has been working on ironing out those details throughout the week.

A new date for the taxing entity committee vote had not been selected as of Thursday. Email: kmckellar@deseretnews.com Twitter: KatieMcKellar1

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