Feature

2009 Legislative Session
Was Fruitful for Economic Development

Utah's 2009 legislative session was a remarkable one for economic development initiatives.

"We achieved some huge successes, especially in light of the tough budget decisions that had to be made," says Jason Perry, executive director of the Governor's Office of Economic Development (GOED).

Perry spent a significant amount of time on Capitol Hill during the 45-day session, testifying during committee hearings and helping to shepherd a variety of bills through the legislative process.

"This is a year when it would have been easy to back away from economic development initiatives, and focus only on present needs," he says. "It took a lot of courage and forethought for the Legislature to consider the state's future and pass these important measures."

By "important measures," Perry is referring to a handful of bills that will have a dynamic impact on the state's economy for years to come. Here's a summary of the legislation to which he is referring:

HB 430 -- in effect, says Utah is open for business in the renewable energy economy. This bill allows GOED to establish renewable energy zones and offer incentives to companies located in these zones, that generate energy from renewable sources, or manufacture parts that go into renewable energy development. Perry says to think of the zones as research or technology parks for renewable energy, with an incentive program for companies innovating in clean energy or creating renewable energy-related products.

SB 76 -- sets up a quasi government authority tasked with the development of a master plan for renewable energy production and transmission infrastructure. This authority will have the ability to apply for and seek out federal grants, and bond to pay for transmission lines that will bring renewable energy to the power grid.

SB 187 -- the word is on the street -- Utah's Legislature has taken the quirkiness out of the state's liquor laws. "This is important to business recruitment," says Perry. "Previously, we spent a significant portion of time explaining the liquor laws to companies interested in Utah. We won't have to do that anymore." Among other things, the measure eliminates the private club and mandatory membership requirement. Since the bill was passed, the state has received a significant amount of good publicity and tour operators from around the world are buzzing about the changes.

SB 14 -- strengthened Utah's financial incentives for motion picture productions. "Until this legislation was passed, Utah was at a competitive disadvantage in recruiting big films to the state," says Perry. "We missed out on 'Transformers,' 'Wild Hogs,' 'GI Joe' and a host of other big budget films that wanted to come to Utah but didn't because the state's previous incentive program was not strong enough." SB 14 raises the incentive to 20 percent of a film's total expenditure in the state and removes the $500,000 cap that had been in place. The new legislation clears the way for the state to recruit the production of big films, television series, made-for-television movies and even film studios. The bill provides for motion picture incentives in the form of cash rebate incentives for small budget productions and refundable tax credits for larger budget productions. Governor Jon Huntsman put $15 million of economic stimulus money into the incentive fund to help recruit bigger budget films and in turn film studios, and Perry says he hopes to see at least one such studio to locate here because of the legislation.

SB 240 -- adds $33 million to the Utah Science Technology and Research Initiative (USTAR). Perry says USTAR is already showing great successes in technology development and transfer within the cluster areas identified by Governor Huntsman and the new money will help USTAR leaders continue to recruit some of the country's greatest minds to Utah.

HB 188, HB 165, HB 331 and SB 79 -- legislation that expands access to the health insurance market, increases market flexibility and provides greater transparency in the health insurance market. The most significant piece of the health system reform effort is the creation of a health insurance exchange. Through the Internet exchange, businesses and individuals will be able to select health insurance plans that are portable and transparent. Consumers (businesses, sole proprietors, or individuals) can sift through the plans in the exchange, comparing both costs and coverage, select the plan that's right for them and pay with pretax dollars. "In a very real sense, the insurance providers are competing with each other in an open forum designed for the consumer," says Perry. The legislation also requires insurers, providers, and the Legislature to continue efforts at health system reform. The Task Force will continue for one year and key players in the system are required to continue the process and report back to the Legislature.

SB 260 -- this measure created the "Home Run Grant," making $6,000 grants available for Utahns that purchase new homes. Governor Huntsman put $10 million of stimulus money into the grant fund, which should help move many of the 3,000 to 4,000 new homes that are currently in inventory around the state, stimulate the economy and create approximately 8,500 jobs -- the biggest weakness in jobs is in the new residential construction market. Last week the Utah Board of Realtors announced that the grants are already breathing new life into the market.

SB205 -- removes the mandate for economic development projects to set aside 20 percent of tax-revenue growth for affordable housing. The bill does not prohibit funneling economic development (EDA) funds toward affordable housing, but rather makes doing so optional.

In other important action, Perry says the Legislature approved $5 billion in transportation funding, a combination of State and Federal dollars, which should translate into 25,000 jobs. Many of Utah's road construction projects are shovel-ready, which helped the state in its application for stimulus money, and the Utah Department of Transportation is already moving forward with a number of significant projects.

The Legislature also approved bonding for capital building projects, added $1 million in one-time funds from the federal stimulus money to $6 million in ongoing funding for the Tourism Marketing Performance Fund (TMPF) which is used to encourage tourists in coming to the State. Tourism is a $7 Billion industry for Utah and is critical to our economy.

The Governor is also using $2 million in stimulus money to continue funding the state's Engineering Initiative. Utah has a critical shortage of engineers and the initiative's purpose is to put more engineers in the marketplace through expanded training at our Universities. "For every engineer we put in the marketplace, we add another five to seven supportive jobs," Perry says. "We can really stimulate the economy by producing quality engineers."

In retrospect, Perry says the 2009 Legislature has thoughtfully advanced Utah's economic development position, despite difficult economic circumstances. "Utah is a very well managed state. Actually, it is the most competitive state in the nation, according to the most recent ALEC-Laffer State Economic Competitiveness Index. There really is no good reason why a company would not want to move to Utah and our business community and government leaders should feel very good about the climate they have created -- they have been very thoughtful about planning for the future."

CALENDAR

- Apr. 13-15:  Utah City Manager Assn.
- Apr. 15:  Executive Committee (EDCUtah)
- Apr. 15-17:  Utah League of Cities and Towns (St. George)
- Apr. 14:  Senator Bennett's 8^th Annual Rural Business Conference (Heber Valley-Zermatt Resort in Midway)
- Apr. 15-17:  Utah League of Cities and Towns Midyear Conference (Dixie Center, St. George)
- Apr. 26-28:  CoreNet (Dallas, TX)
- Apr. 29-May1:  SME (San Diego, CA)
- Apr. 30:  New Investor Orientation (EDCUtah)
- May 2-6:  IAMC (Asheville, NC)
- May 4-7:  Windpower 2009 (Chicago)
- May 14 or 27 (TBD):  EDCUtah Board meeting (Hope Gallery)
- May 17-20:  ICSC (Las Vegas)
- May 18-21:  SAMPE (Baltimore)
- May 18-21:  BIO (Atlanta)
- June 3:  EDCUtah Golf for Grants Match Grant Tournament (Eaglewood Golf Course in North Salt Lake). This is the main fundraiser for EDCUtah's Community Match Grants Program. Sponsorship opportunities for 2009 are limited to investors in EDCUtah and are now available. Please call Arthur Franks, membership director for EDCUtah at (801) 323-4242 to secure your sponsorship opportunity!
- June 11:  Quarterly Investor Update (TBD)
- June 16:  New Investor Orientation (EDCUtah)
- June 17:  Executive Committee Meeting (EDCUtah)
- July 20:  OIA Thought Leader (TBD)
- July 21-24:  Outdoor Retailer Summer Market (SL Convention Center)
- Aug. 10-13:  AUVSI (Washington, D.C.)

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