If Utah lands a National Hockey League team, it would play in a new arena in downtown Salt Lake City as a key part of an ambitious endeavor to give the city center a dramatic makeover in the coming years.
“It’s the spot for it,” Senate President Stuart Adams, R-Layton, told reporters. “We think the right thing is to bring it downtown and continue that vitality, that excitement and not let our capital city go in ... disrepair like we’ve seen around the country.”
Lawmakers will consider a bill that would create a sports and entertainment project area to raise state sales tax .5% to generate an estimated $1 billion over 30 years for construction of a hockey venue. That would push the sales tax rate in Salt Lake City to 8.25%. A committee made up of members appointed by the Senate president, House speaker and governor would oversee the project area.
Titled “Capital City Reinvestment Zone Amendments,” SB272 unanimously cleared the Senate Revenue and Taxation Committee on Thursday. It now goes to the full Senate for consideration.
Proponents of the proposal, including Salt Lake City Mayor Erin Mendenhall, say the legislation would be transformative for the city’s downtown.
“This bill is very exciting in how it can transform our downtown and better connect current entertainment offerings,” the mayor told the committee.
Mendenhall, a Democrat, said it would link the east and west sides of downtown, including the Delta Center, Temple Square, the theater district, and the City Creek and Gateway malls.
“We’re not building a hockey arena, we’re building a city,” said Sen. Dan McCay, R-Riverton, the bill’s sponsor. “Think of the capital city that’s economy represents all of Utah.”
SB272 is the second piece of legislation unveiled this week that would increase taxes for construction of a sports and entertainment district.
On Tuesday, a bill came forward that would create a board with taxing authority to generate at least $900 million for construction of a Major League Baseball stadium in the Fairpark neighborhood on Salt Lake City’s west side as part of a mixed-use development proposed by the Larry H. Miller Company. HB562 would allow the board to levy a variety of taxes, including raising the state’s hotel and car rental taxes.
Rusty Cannon, president of the Utah Taxpayers Association, told the committee the group is neutral on the downtown reinvestment bill.
But, he said, small tax increases here and there can pile up.
“We can tip the boat and hurt our competitiveness if we’re not careful,” he told the committee. “We hope that everybody realizes that this is not coming for free, that it will be paid for by taxpayers through an additional sales tax in Salt Lake City.”
McCay said the state has various levers it can pull to bring in more revenue.
“In this situation, we have Major League Baseball and they’re pulling a lot of levers for a bunch of different purposes to try and accomplish a similar goal to build a sports venue. If you look at that, though, the one lever that hadn’t been pulled was sales tax increment,” he told reporters earlier Thursday.
McCay said lawmakers don’t want to stack the tax subsidies for baseball and hockey on top of each other “so that those become unlivable environments for those who are paying the tax.”
“At the same time, the sales tax was something we weren’t capitalizing on but provided the opportunity for all of us really to accomplish a very similar investment in a very simple way.”
Utah Jazz owner Ryan Smith is pursuing an NHL franchise for Salt Lake City. Last month, his Smith Entertainment Group formally requested the NHL initiate the expansion process to bring a team to the state.
Smith has said the Delta Center — configured to seat around 14,000 for hockey — could accommodate a team as early as next year, with designs on building an arena dedicated to hockey in the future. There has been speculation that Smith would look south to construct a new venue in a mixed-use development called The Point that’s in the works at the former state prison site.
Smith told the committee the bill provides for multiple sports teams in the city center for years to come.
“The idea of professional sports in a city, in a downtown is the greatest anchor tenant that a city could have, hands down,” he said. “The opportunity to have multiple sports downtown can transform and revitalize and invest and grow a city in a way that is almost irreplaceable any other way.”
Smith, Mendenhall, Salt Lake County Mayor Jenny Wilson and the Salt Lake City Council also issued a joint statement saying they are working hard together to keep the Jazz downtown long term and attract an NHL team.
“As we look toward the future, the time has come to reimagine what the city can be. A lot of work needs to be done through investment to develop new infrastructure, enhance connectivity, attract impactful activations and create a safe, welcoming environment for everyone in downtown,” the statement said.
Legislative leaders didn’t pinpoint a downtown location for a potential hockey arena, saying that SEG and Salt Lake City would have to work that out. But they did suggest it could be near the Delta Center.
“If you look at where the Delta Center is now and what’s around the Delta Center, and you look at opportunities around the Delta Center to make improvements, I think you can pretty quickly see how downtown kind of stops at the convention center. It blocks the west side,” McCay said.
That would mean tearing down or repurposing existing buildings. McCay said a lot would need to change in that area for it to function like, for example, the Staples Center or SoFi Stadium in Los Angeles.
“To accomplish something like that, you need a dramatic change of the landscape downtown,” he said.
Adams said it’s a lot easier to develop an open field but state leaders say a downtown hockey venue would keep downtown viable. McCay said legislators are committed to making sure that what happens in other metropolitan areas doesn’t happen in Utah.
“Here we have an Olympics knocking at our door in 2034. We have the NHL and we have the NBA who want to be downtown and Major League Baseball is going to be right close by,” McCay said.
Lawmakers, he said, are trying to build on Utah’s past economic success to keep Salt Lake City the vibrant entertainment, sports and cultural center of Utah in the 2020s and 2030s.
Utah lawmakers last month passed resolutions supporting efforts to bring the NHL and MLB to the state.