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Salt Lake County strikes a blow for tranparency

8/8/2018

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Quick, can you recite some of the tax breaks your local government gave to new businesses over the past several years, and do you know whether the promises those businesses made to get that money came true?
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I thought so.
Sure, you might remember something about a Facebook data center promising to come to Eagle Mountain recently. If you’re astute, you might remember that at least $150 million in tax breaks were pledged over 20 years. But 20 years from now, you might not think to question whether it all was worth the money.

And I doubt you have much idea about all the other tax breaks handed out over the last 40 years.

The debate about proposed tax giveaways, in the media or at public hearings, tends to happen only before deals are signed. No one seems to care what happens next.

What would change if everyone knew the promises would be tracked and made public for years to come?

We’re about to learn the answer, at least in Salt Lake County.

The county is unveiling a new website that keeps track of all tax incentive deals, past and present, dating to the first downtown redevelopment project in Salt Lake City in 1974.

Blake Thomas, the county’s municipal economic development director, spent two years doing the lion’s share of work on this project, under the direction of County Mayor Ben McAdams. The two of them gave me a demonstration of the site earlier this week.

When he started the work, Thomas said he asked how many such projects existed. “I would get different answers from different parties,” he said.

No one knew. Considering it’s your tax money we’re talking about, you should be more than a little upset by that.

The good news is that now you have an answer. The total is about $1.3 billion in tax incentives since that first project, and the value of land involved in all projects combined has increased by about $8.4 billion.

That $1.3 billion figure is money school districts and other taxing entities might otherwise have enjoyed.

Some would argue that point. Without an incentive, the projects in question wouldn’t have been built, they would say. But it’s reasonable to assume that, in a county of more than 1 million people, some projects would have happened regardless.

And when projects bring new people, schools are affected.

But the key to understanding it all is transparency. Without the facts, politicians and the public can’t know what worked and what didn’t.

“It’s easy to give up tomorrow’s appropriation if it doesn’t really affect you today,” McAdams said. “But it really does affect our taxpayers.”

When it debuts this week, the website will be linked to the county’s economic development page, http://slco.org/economic-development/Once there, users can scroll over a map of the county, zoom into any particular area and see the boundaries of various redevelopment, economic development or other tax incentivized areas. Then they easily can drill down, calling up original documents used as selling points for the project, and examine how much the taxable value of the land has increased since the project began. They then can compare this with the tax incentive.

The database won’t settle arguments over whether projects were worthwhile. But it will clothe those arguments with important facts.

It isn’t perfect. For example, dollar amounts are not adjusted for inflation. A project that started 30 years ago when the land was valued at $1 million, for instance, may look wildly successful when compared with the current valuation. It would seem less of a success if the original value were presented in 2018 dollars.

Transparency, however, has transformative powers. McAdams said the county is demanding more specific, measurable goals upfront.

“I hope this gives us the ability to learn from our successes, instead of flying blind,” he said. “Just knowing that this will be in the public eye indefinitely, I hope, will make us sharpen our pencils.”

In coming weeks, the county council will consider policy changes connected to the database. It also will ensure the database continues to be updated long after the current mayor is gone.

The database may be the first of its kind in the nation. It definitely is the only one in Utah. That needs to change.

Several years ago, the New York Times tried to determine how much tax money local governments gave away to businesses nationwide. It arrived at an estimate of $80.4 billion a year. More recently, Amazon has been demanding outrageous promises from cities that want to host a new headquarters campus. The Times this week said many elected officials don’t even know what their cities are offering.
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That’s not healthy for self-government. Transparency, on the other hand, most definitely is.
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    Jay Evensen is the Senior Editorial Columnist of the Deseret News. He has nearly 40 years experience as a reporter, editor and editorial writer in Oklahoma, New York City, Las Vegas and Salt Lake City. He also has been an adjunct journalism professor at Brigham Young and Weber State universities.

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