Kennecott Utah Copper has long been known for its mining operations, but a recent study shows sister company Kennecott Land is also sitting on a gold mine of real estate.
According to a study released Monday by the University of Utah's Bureau of Economic Business Research, Kennecott Land's undeveloped 40,000 acres have the potential of bringing billions of dollars in taxes and hundreds of thousands of new jobs to Salt Lake County's west side by 2060.
With half of the county's remaining developable land in hand, and another 40,000 acres of undevelopable acreage on the side, Kennecott Land is poised to change the face of the west bench and influence Salt Lake County's financial future, says Jim Schulte, Kennecott Land's vice president of long-range planning.
"As we begin to think about our property and compare it to development on the east bench, we recognize we're the other side of that equation," Schulte said. "As the west side develops we would expect to see more (economic) centers develop in the west side. It's not a matter of competing with those other centers, it's a matter of providing the same ... (opportunities) closer to that population so that everyone doesn't have to drive 25 or 30 minutes to an employment center."
Kennecott paid an undisclosed amount of money to the U. to give estimates on the 40,000-acre project's economic potential. According to the study, it is estimated that local governments will collect an estimated $12 billion in taxes and fees from the development between 2010 and 2060. When the project is completed, it is estimated the west bench area Kennecott's land that reaches from northern Salt Lake County, west along the foothills of the Oquirrh Mountains and south to Herriman will generate $480 million annually in local tax revenue.
Just which local government will receive the potential money is a mystery. Currently, the majority of Kennecott's land is in unincorporated Salt Lake County, with the exception of Daybreak, which is in South Jordan.
Schulte says the development may create its own city, join with neighboring cities or stay in unincorporated county territory, depending on what works best with the "vision" of the project. Bordering cities, like South Jordan, are already envisioning annexing parts of the project, which might take 50 to 75 years to complete.
"There are areas in that west bench that are in our annexation area that we would consider, when the timing is right," said South Jordan Long-Term Planning and Sustainability director Brian Preece. "We can do what we can to sweeten the deal, but we can't just go out and grab it."
The project could generate some 260,000 jobs by 2060 and bring about 200,000 more homes and 600,0000 residents to the area, according to the study. In the next 50 years, those numbers could change, but the information is still a worthy starting point, said Bureau of Economic and Business Research Director James Wood.
"The projections are more reliable than what we had before, which was zero," Wood said. "The next study will be more reliable, but you have to start some place.... There is a lot of speculation, but it provides a context for a reference point; and when we'll be looking at this some time in the future again, probably several things will change."
Kennecott Land could start exploring new areas for development as soon as 2010, but a time line for the project is tied to the future of Kennecott Utah Copper's Bingham Canyon Mine. Kennecott Utah Copper has said the Bingham Canyon mine could stay open several decades beyond 2019, and Kennecott Land will begin to phase out the mine with other land uses when the time is right.
In the meantime, neighboring cities aren't the only entities interested in the west bench's potential. The information found in Wood's study is helpful to the Governor's Office of Planning and Budget, which forecasts state economic conditions and revenues and helps keep other organizations, like Utah's Department of Transportation, apprised of developing needs."A lot of it has to do with planning for the future," said Melissa Glosenger, research analyst for the Governor's Office of Planning and Budget. "UDOT and a lot of other planning departments use our projections to factor that into their future plans," she said. "If there is a huge area of growth, they would want to target that area."
Values when project is completed in 2060
When the Kennecott west bench project is completed in 2060, it is projected that the west bench will account for:
• Nearly 26 percent of Salt Lake County's residences
• 21.8 percent of its office space
• 12.5 percent of its industrial space
• 11.1 percent of its retail space
By 2060, the statewide economic activity generated by the west bench development will be:
• 302,200 jobs
• $16.7 billion of personal income
• This will support a statewide population increase of 288,700 peopleSource: University of Utah's Bureau of Economic and Business Research