SALT LAKE CITY — The Redevelopment Agency of Salt Lake City on Tuesday approved $22.7 million in tax increment financing in support of a planned $125 million renovation effort for Vivint Smart Home Arena.
The funds represent 18 percent of the project's total cost.
The Larry H. Miller Group says project improvements will include safety and security upgrades, updating existing heating ventilation and air conditioning systems, installation of a new photovoltaic solar panel system, along with plaza, concession, seating and premium suite upgrades.
“We’re excited about the future of the renovation and what it means for our community,” said Utah Jazz President Steve Starks. “Today’s vote represents the support that the community has always had for the organization and the Miller family.”
Starks said the tax incentives “will enable us to move forward and bring the venue back to world class again.”
With financing now in place, the Miller organization will be able to update the aging 19,911-seat building — which annually hosts 1.8 million people for Utah Jazz games and numerous other events — thanks to a still-solid infrastructure and because of the meticulous upkeep it’s received since its creation.
LHM officials have been involved in a planning process with arena construction and renovation specialists, the ICON Venue Group and SCI Architects, to conduct a comprehensive review of possibilities, best practices, potential budgets and other recommendations.
Over the life of the agreement through 2040, the $22.7 million amount would be reimbursed to the Larry H. Miller Group through the agency's portion of annual property tax income.
Currently valued at $58 million, the arena is older now than the Salt Palace was when the new arena was built in 1990.
The group will pay for the renovations up front, explained Miller family spokesman Steve Miller. Reimbursement will occur as the venue meets requirements based on assessed property value and taxes generated, said Christine Richman, consultant for the LHM Group.
During a meeting at the City-County Building, the project received support from various sources, including the Salt Lake Chamber and the Utah Taxpayers Association.
“As we’ve analyzed the data around this proposal and discussed our concerns with the Jazz organization, we’ve determined not to oppose this tax increment plan,” said Billy Hesterman, vice president of the Utah Taxpayers Association. “The Utah Jazz and their arena bring significant economic activity to our state that would not occur if the team and its arena were not in place.”
He added that the state economy has benefitted over the years by the attraction of numerous concerts, corporate events and other performances staged at the arena.
“The upgrades to the arena will ensure that those types of activities will continue to take place in our state and add to our economy,” he said. “We recognize the intangible value that the Jazz brings to our community. Their presence plays a role in attracting high-paying jobs as having an NBA team increases the quality of life the state enjoys.”
However, not everyone favors the tax break.
“If we don’t give tax credits to homeowners who need them, why do we give them to corporations that can afford to pay them,” asked Evelyn Everton, state director for American for Prosperity, a conservative political advocacy group. Citing a national study, she added, “Basketball arenas don’t add economic value on their own, but are instead highly dependent upon local social and economic contacts.”
Everton said the Miller organization has the means to pay for the upgrades without taxpayer assistance and implored the city's redevelopment agency to deny the financing request.5 comments on this story
“Taxpayers should not be relied on to support a private corporation’s profits,” she said.
Ultimately, however, the RDA decided to support the project without a single opposition vote.
Meanwhile, Jazz officials were relieved that plans can now move ahead to make improvements that will start almost immediately and are scheduled to be completed by the beginning of preseason basketball for the 2017-18 NBA season, Starks said.
“We’re thrilled and feel that sense of stewardship to continue to make the venue better and stay world class,” Starks said.