02-27 09:56 3rd Sub. (Ivory) S.B. 129
James A. Dunnigan proposes the following substitute bill:
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Higher Education Development Areas
2025 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Chris H. Wilson
House Sponsor: Steve Eliason
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LONG TITLE
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General Description:
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This bill enacts provisions relating to the development of property owned by certain higher
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education institutions.
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Highlighted Provisions:
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This bill:
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▸ authorizes certain higher education institutions to designate a development area consisting
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of property owned by the institution;
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▸ provides a process for an institution to adopt a resolution designating a development area;
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▸ requires an institution to establish a fund for revenue from the development area and
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provides for uses of money in the fund;
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▸ provides limitations on a member of the board of trustees regarding participation in
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development actions and requires a member of a board of trustees to disclose a conflict
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before the board of trustees approves a development agreement;
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▸ requires payment of privilege tax on leased property within a development area and
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describes the method for a county treasurer to distribute privilege tax revenue to the
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institution; and
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▸ requires the board of trustees to provide an annual report to the Higher Education
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Appropriations Subcommittee for each development area.
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Money Appropriated in this Bill:
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None
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Other Special Clauses:
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This bill provides a special effective date.
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Utah Code Sections Affected:
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ENACTS:
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53B-20-108, Utah Code Annotated 1953
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Be it enacted by the Legislature of the state of Utah:
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Section 1. Section 53B-20-108 is enacted to read:
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53B-20-108 . Development of university property.
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(1) As used in this section:
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(a) "Board of trustees" means the board of trustees of an eligible university.
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(b) "Conflict" means a situation in which a board of trustees member or a family
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member of a board of trustees member will or is likely to receive a direct financial
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benefit because of the development of eligible university property within a
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development area.
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(c) "Designation resolution" means a board of trustees' resolution designating eligible
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university property as a development area.
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(d) "Development action" means:
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(i) a board of trustees' deliberations on whether to adopt a designation resolution;
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(ii) a board of trustees' adoption of a designation resolution;
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(iii) a board of trustees' deliberations on whether to approve a development
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agreement; or
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(iv) a board of trustees' approval of a development agreement.
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(e) "Development agreement" means an agreement between an eligible university and a
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development partner that governs the development of eligible university property
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within a development area.
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(f) "Development area" means a single, contiguous area that:
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(i) consists only of eligible university property;
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(ii) is no larger than 75 acres; and
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(iii) the board of trustees designates for development or redevelopment in a
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designation resolution under this section.
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(g) "Development fund" means the fund described in and established under Subsection
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(4).
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(h) "Development partner" means a person who enters into a development agreement
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with an eligible university to develop or redevelop eligible university property within
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a development area.
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(i) "Direct financial benefit":
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(i) means any form of financial benefit that accrues to an individual directly,
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including:
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(A) compensation, commission, or any other form of a payment or increase of
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money; and
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(B) an increase in the value of a business or property; and
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(ii) does not include a financial benefit that accrues to the public generally.
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(j) "Eligible university" means an institution of higher education listed in Subsection
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53B-1-102(1)(a).
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(k) "Eligible university property" means real property owned by an eligible university Ĥ→
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as of January 1, 2025 ←Ĥ .
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(l) "Family member" means a parent, spouse, sibling, child, or grandchild.
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(m) "Leased property" means eligible university property that:
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(i) is within a development area; and
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(ii) an eligible university leases to a private person.
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(n) "Privilege tax" means a tax imposed under Section 59-4-101.
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(2)(a) Except as provided in Subsection (2)(f), before January 1, 2035, an eligible
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university may, by resolution of the eligible university's board of trustees, designate
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eligible university property as a development area.
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(b) Before adopting a designation resolution, a board of trustees shall:
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(i) obtain approval from the Utah Board of Higher Education of the geographic area
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proposed to be designated as a development area; and
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(ii) after obtaining approval from the Utah Board of Higher Education under
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Subsection (2)(b)(i):
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(A) provide notice of the public hearing required under Subsection (2)(b)(ii)(B),
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as required for a class A notice under Section 63G-30-102, for at least seven
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days before the day of the public hearing; and
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(B) hold a public hearing on the proposed adoption of a designation resolution.
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(c) A notice under Subsection (2)(b)(ii)(A) shall include a copy of the proposed
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designation resolution.
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(d) A designation resolution, including a proposed designation resolution that
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accompanies a notice under Subsection (2)(b)(ii)(A), shall:
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(i) accurately describe the boundary of the proposed development area;
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(ii) describe the development that is proposed to occur in the proposed development
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area; and
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(iii) estimate the amount and sources of revenue the eligible university expects to
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receive from the development area.
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(e) Before adopting a designation resolution, a board of trustees may modify the
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proposed designation resolution to:
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(i) address concerns raised in a public hearing held under Subsection (2)(b)(ii)(B); or
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(ii) clarify or adjust provisions of the proposed designation resolution, as the board of
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trustees considers appropriate.
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(f) A board of trustees may not adopt a designation resolution if:
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(i) the board of trustees has previously adopted a designation resolution; or
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(ii) the area in the proposed development area would overlap with part or all of:
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(A) a community reinvestment project area created under Title 17C, Chapter 5,
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Part 1, Community Reinvestment Project Area Plan, as that project area exists
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on Ĥ→ [May 7, 2025] January 1, 2025 ←Ĥ ; or
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(B) a housing and transit reinvestment zone created under Title 63N, Chapter 3,
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Part 6, Housing and Transit Reinvestment Zone Act, as that zone exists on Ĥ→ [
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May ] ←Ĥ
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Ĥ→ [7, 2025] January 1, 2025 ←Ĥ .
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(3) Within 30 days after a board of trustees' adoption of a designation resolution, the board
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of trustees or the board of trustees' delegee shall deliver a copy of the designation
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resolution to:
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(a) the clerk of the municipality in which the development area that is the subject of the
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designation resolution is located; and
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(b) the assessor, treasurer, and auditor of the county in which the development area that
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is the subject of the designation resolution is located.
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(4)(a) Upon adoption of a designation resolution, a board of trustees shall establish a
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separate fund related to the development area that is the subject of the designation
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resolution.
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(b) An eligible university shall deposit into a development fund all money the eligible
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university receives from the development and lease of eligible university property
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within a development area.
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(c) Money in a development fund shall be accounted for separately from any other fund
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of the eligible university.
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(d) An eligible university may use money in a development fund for:
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(i) expenses associated with the development of the development area;
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(ii) capital facility projects of the eligible university;
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(iii) operation and maintenance costs associated with capital facilities of the eligible
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university; or
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(iv) any other eligible university-related purpose.
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(5) An eligible university may enter into a development agreement.
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(6)(a) A board of trustees member may not participate in a development action if the
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board of trustees member or a family member of the board of trustees member owns
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an interest in, is directly affiliated with, or is an employee or officer of a private firm,
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private company, or other private entity that the board of trustees member reasonably
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believes is likely to participate in or receive a direct financial benefit from the
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development of land that is the subject of a development agreement.
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(b) Before the board of trustees approves a development agreement, the board of trustees
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shall require any member with a conflict to disclose the conflict in writing to the
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board of trustees.
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(c) Nothing in this Subsection (6) affects the application or effect of any other code
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provision applicable to a board of trustees member relating to ethics or conflicts of
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interest.
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(7)(a) Beginning January 1 of the year immediately following the execution of a
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development agreement, the possession or other beneficial use enjoyed by a person of
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leased property that is located within the development area subject to the
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development agreement shall be subject to Title 59, Chapter 4, Privilege Tax, if that
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leased property is used in connection with a business conducted for profit.
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(b) The treasurer of the county in which the leased property described in Subsection
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(7)(a) is located shall, in the manner and at the time provided in Section 59-2-1365:
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(i) collect privilege tax from a lessee of the leased property; and
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(ii) distribute 80% of the privilege tax revenue to the eligible university.
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(8)(a) A board of trustees shall present a written report to the Higher Education
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Appropriations Subcommittee no later than September 30 of each year after the board
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of trustees' adoption of a designation resolution.
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(b) A report under Subsection (8)(a) shall:
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(i) describe the development taking place or expected to take place within the
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development area; and
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(ii) provide a summary of money deposited into and expended from the development
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fund for that development area.
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Section 2. Effective Date.
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This bill takes effect:
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(1) except as provided in Subsection (2), May 7, 2025; or
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(2) if approved by two-thirds of all members elected to each house:
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(a) upon approval by the governor;
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(b) without the governor's signature, the day following the constitutional time limit of
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Utah Constitution, Article VII, Section 8; or
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(c) in the case of a veto, the date of veto override.
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