The Utah state senate hearing room was filled with high paid lobbyist and business representatives in anticipation of a hearing on SB267 which creates a private-public partnership for a new downtown Salt Lake City convention hotel.
SB267 was brought to the Senate’s Economic Development and Workforce Services Committee with only days left in the legislative session as frequently occurs with bills supported by powerful business and government interests. And as all too often occurs on this type bill, the sponsor is a member of Senate leadership, Majority Whip, Stuart Adams.
After a short, extremely general description of the bill by its sponsor and a consultant representing Salt Lake County followed by a few shallow questions from committee members, the committee chair went to public comment, restricting each person to just two minutes.
Those supporting the taxpayer subsidized convention hotel, parking terrace and convention facilities stressed the economic benefits of the project to downtown businesses and its positive impact on the state’s economic development. Most of those commenting in favor of the bill had either a direct or indirect interest in the project.
Those opposing the bill:
- questioned why legislators were acting as developers rather than as legislators,
- commented on the fact that studies evaluating the impact on existing hotels were lacking and that public subsidies for the new facilities would place other hotels at a disadvantage,
- emphasized that the project had not been adequately studied and that limiting public comment to two minutes per person did not give adequate time to address the complex issues surrounding this project,
- challenged the late introduction of the bill which precludes a House hearing and forces legislators in both Houses to vote on SB267 with only minimal information, and
- asked legislators to mandate the use of E-Verify by all companies involved in the taxpayer subsidized public-private project to ensure that jobs go to legal residents and citizens.
Clint Ensign, senior vice president for the Sinclair Companies which owns the privately funded and owned Grand and Little America hotels, told the committee that Salt Lake County officials had not given him the opportunity to discuss the project with them in spite of requests to do so. He requested that the bill be delayed until next year so he could work with the county in the interim.
Ensign also pointed out that proponents of the convention hotel only looked at the most immediate benefits while failing to account for the negative costs. These include lost revenues to both the owners of existing hotels and a loss of tax revenues for all levels of government due to lower occupancy rates in other hotels.
Ensign argued that if the convention hotel is built, the Grand and Little America hotels along with other hotels in the area will have to compete unfairly with a huge, taxpayer subsidized convention hotel that will likely discount rates to maintain its occupancy rates.
Ensign also argued that a large convention hotel would not bring large conventions to Salt Lake City because of the perception that convention planners have of the state. In addition, the Salt Palace is often not available on the dates convention planners are looking at.
Following public comments, a motion was made to move the bill out with a favorable recommendation. Although a number of committee members expressed reservations about the bill they still voted to send it to the full senate.
SB267 is the type legislation that damages the legislature’s reputation and leaves the public feeling that legislators are controlled by a small group of powerful lobbyists and their business and government clients.
It was well known that the bill would be coming forward far in advance of the time that it actually had its Senate Committee hearing. However, had it come out earlier, it would have faced deeper scrutiny and it may have been held in committee until all sides were brought into the process.
As it was, the bill was introduced in the Senate on Friday March 1, assigned to a committee on Monday, March 4, heard in committee on Tuesday, March 5 and it was on the Senate’s Second Reading Calendar on Wednesday March 6. Few bills move as quickly as this.
By waiting until the waning days of the legislature, the Senate ensures that no House hearing will be held on the bill, that the time for debate on the floor of both Houses will be extremely limited and that some of the state’s highest paid and most powerful lobbyists will be able to force it through both Houses before the end of the session.
In the Senate, the bill will likely be passed under suspension of the rules allowing it to be read for the second and third time the first time that it is considered rather than having to be debated and voted on twice by the Senate. Once passed, it will be given priority by Senate leadership for House consideration.
In both houses, discussion will be limited to minutes as the Senate and House rush to pass as many bills as possible in the waning days of the legislative session. Had SB267 been heard earlier, it would have had to undergo much greater scrutiny.
As noted by Connor Boyack of the Libertas Institute, legislators should not be in the position of picking winners and losers or acting as developers but that is exactly what they are doing in this case by giving those feeding from the public trough the advantage over those who are self-sufficient and who truly contribute to the economy.
Before proceeding with this bill, legislators should take the time to read Frederic Bastiat’s That Which is Seen, and That Which is Not Seen and apply it to their analysis of this project. They should also read Bastiat’s The Law which defines and discusses legal plunder. Finally they should immerse themselves in Henry Hazlitt’s Economics in One Easy Lesson.