Economic gardening could sprout with help from new task force

Governor Gary Herbert has signed HB 28, a bill that will form an Economic Development Task Force to find ways to improve Utah’s economy. Economic gardening is one topic that the new task force may address. Watch this video to learn more from the bill sponsor Representative Brad Wilson (R-Kaysville):.


Here’s the script of the video:  Read more

Video: Sandy favors Scheels with $16.8 million tax deal

In January, we wrote about a special 25-year tax deal that Sandy has offered to Scheels, a sporting goods store. Watch this video report to hear what representatives from Sandy, Sutherland Institute, and a local business competitor had to say about the deal:


What do you think about the deal Sandy has offered to Scheels?

Here’s the script of the video:  Read more

Video: Behind Costco’s Spanish Fork deal


Photo credit: Steve F

What if your next-door neighbor were able to pay zero sales taxes for 18 months ($2,000 for the average Utahn) and zero utility bills for four years – and you had to subsidize this arrangement?

As we reported two weeks ago, Spanish Fork has offered Costco a special deal like this, while its soon-to-be competitors will continue to pay full tax rates and utility bills. We interviewed Seth Perrins of Spanish Fork and Bret Gallacher of Associated Foods to understand better how this deal will affect the city and its current businesses.

You can hear what they said in the following video report:


Here’s the script of the video:  Read more

Sandy favors retailer with a tax break – for a quarter-century


Scheels construction site in Sandy off I-15 exit at 11400 S. Photo credit: Alexis Young

Last Friday, we highlighted a special tax deal offered to Costco by Spanish Fork. Today, we highlight another deal offered in Sandy to Scheels, a sporting goods superstore, and analyze the rationale used to justify these kinds of deals.[pullquote]Government should not be in the business of providing advantages to favored companies[/pullquote]

Earlier this year, Sandy city, Salt Lake County, Canyons School District, and four smaller taxing entities agreed to rebate 100 percent of Scheels’ property taxes for 25 years for a new store in Sandy, a deal worth more than $16.8 million (see here, here, here and here).

To illustrate the magnitude of this deal, the same privilege offered to residents of Salt Lake County, including Sandy, would save each household an average of $1,817 per year in property taxes,1 or $45,425 over a 25-year period. And the same deal would save other businesses an average of $8,928 2 per year for each commercial property they own, equal to $223,205 per property over 25 years.

These numbers raise an important question: Why does Scheels, a company based in Fargo, N.D., get a tax break of mammoth proportions while Utah families and other businesses that have been paying full tax rates for years or decades get nothing?  Read more

Costco deal unfair to other Spanish Fork businesses


How would you like to pay no sales taxes for 18 months and no utility bills for four years? Sounds like a sweetheart deal, doesn’t it? Well, it is for Costco in Spanish Fork. The city has offered Costco, a multibillion-dollar corporation, these special privileges and more for building a store within city limits (see here and here).[pullquote]Favoring one company over another…is bad public policy.[/pullquote]

I wonder what Costco’s competitors in Spanish Fork think about this deal, especially the smaller, home-grown companies that have operated there for years or decades without receiving any special treatment.  Read more

To grow Utah’s economy, start at home


We have been critical of many of the state’s economic development programs designed to lure large corporations to Utah. For example, see here.

But any legitimate critique of policy should be accompanied by a reasonable alternative.

Today, Sutherland released a new paper that outlines a strategy called “economic gardening” – an approach to economic development that could lead to thousands of homegrown jobs for Utahns.

You can read the paper here:

Economic Gardening: A Proposal for Growing Utah’s Economy from the Inside Out

Let us know what thoughts you have on our proposal.  Read more

Government-created jobs? Pure fiction


Jobs are a hot topic in politics these days. President Barack Obama is pushing his jobs plan; his Republican challengers are wrangling over who can create the most jobs; and Governor Gary Herbert has announced a goal to see 100,000 Utah jobs created in 1,000 days. All this talk about jobs raises a question: Can government create jobs?

[pullquote]Government should create only what it can: a legal and policy framework in which entrepreneurs – the real job creators – can do what they do best without government getting in the way.[/pullquote]The way many presidential candidates talk, you’d think they can simply pull a lever or wave a magic wand, and poof – a new job appears out of thin air. In reality, government can do very little, if anything, to create jobs.

Governor Herbert acknowledges this. While announcing his jobs goal he declared, “In Utah, we recognize it is the private sector – operating in free markets – which produces jobs, opportunity, and prosperity for our citizens.” He understands that government cannot create jobs but can promote policies that allow businesses to expand. Read more

KCPW brinksmanship shows how businesses dupe policymakers

A very instructive interaction recently concluded in Salt Lake City between the city council and KCPW, a local nonprofit radio station. It helps illustrate how private-sector businesses can (and often do) dupe policymakers into giving them special, privileged deals that their competitors do not enjoy, and which are not even necessary to accomplish the stated goal of the deal.

It all began in the second week of October when KCPW officials approached the city because they had an outstanding loan that was about to expire and, according to KCPW’s general manager, their “backs [were] against the wall.” Without the loan from the city, KCPW would be going off the air. The city’s citizen loan committee had recommended that the city council turn down the loan because “KCPW had not proven it could repay” it. Ignoring this warning, the city council chose to override the loan committee recommendation and award the loan to KCPW anyway. Read more

The price of a blender and the market economy


The other day, I stopped at a yard sale with a friend. He had spotted a blender as we drove by and wanted to take a look at it. He picked it up, pulled out the glass jar and examined all the blender’s parts. After determining it would serve as a suitable replacement for his worn-out blender at home, he asked the homeowner how much she wanted for it.

She pondered for a moment and then threw out an offer, “How about $3?” Her manner indicated that she was likely new to the yard sale business and had little knowledge of what her blender might be worth. I thought for sure my friend would accept the offer. He replied, “OK, I’ll think about it.” Read more

Will the economics of nuclear energy work for Utah?


This morning, during part three of Sutherland’s series of policy forums called “Is Utah Ready for Nuclear Energy?” a panel of experts discussed the economics of nuclear power generation.

A Utah company is currently working to build a nuclear plant near Green River, Utah – an endeavor called Blue Castle Project. The panel at today’s forum made many interesting observations in regard to the economics of nuclear power which relate to this project. You can watch the entire forum here:


For those who can’t watch the forum, I’ll review some of the most interesting points here. Read more