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SALT LAKE CITY — Decisions about the long-term fate of the Utah Science, Technology and Research initiative were kicked down the road Tuesday, though an interim legislative committee heard an exhaustive rundown of the work being done by the Governor's Office of Economic Development as part of that process.
Lawmakers, who slashed USTAR's budget by a third in the last session and canceled the agency's long-running work to recruit top-tier researchers for the University of Utah and Utah State University, are continuing to consider whether the effort, launched in 2005 by then-Gov. Jon Huntsman, Jr., has outlived its usefulness.
In June, USTAR was called to give a similar accounting to the Business, Economic Development and Labor Appropriations Subcommittee as committee members work to evaluate if there are any redundancies or overlaps between the two efforts. USTAR presenters were peppered with questions about whether the agency's work, which is focused on supporting the pipeline that carries research innovations into for-profit commercialization, is an appropriate role for government.
"We, as policymakers, have to make policy decisions," said Rep. Marc Roberts, R-Salem. "Is the $20-25 million better spent on this … or is it better spent on roads and other infrastructure that are more, in my mind, justifiable government operations?"
On Tuesday, Sen. Jake Anderegg, R-Lehi, raised a similar question about the Governor's Office of Economic Development.
"Is this the proper role of government," Anderegg questioned. "Is this something we should even be doing? Giving taxpayer dollars to a business and expecting a return?"
The office's executive director, Val Hale, and his team spent two hours providing details of the agency's work in hopes of providing lawmakers with evidence upon which to answer that question. He noted the state continues to be a success story, with nation-leading job growth, the most diverse economic portfolio in the country and a business friendly regulatory and tax environment.
The economic development office oversees more than a dozen different programs aimed at bolstering the state's economy, ranging from tourism to broadband deployment to corporate recruitment.
Tourism, perhaps not surprisingly, is the most monetarily successful of the office's efforts. Visitors to Utah's five national parks, 14 ski resorts and numerous state and local attractions generated some $9.2 billion in overall spending last year, netting $1.3 billion in state revenues. Hale praised Utah Office of Tourism, Film and Global Branding Director Vicki Varela as "hands down, the best in the country."
The next most lucrative of the office's economic development efforts is the Economic Development Tax Increment Financing program, which can grant companies up to 30 percent tax rebates for as long as 20 years for either moving to Utah or making the decision to stay and expand in the state.
Last year, that program had generated over $260 million, after costs, since its launch in 2004. The beauty of the program, Hale explained, is that the tax rebates are only granted "post-performance" so if a company does not perform to its projections in terms of jobs created or revenues generated, the state does not lose money.
Lawmakers were particularly interested in hearing about two of the economic development office's programs: the Technology Commercialization and Innovation Program and statewide Business Resource Centers, which some legislators believe may represent redundancies with work that USTAR is also involved with.
While Hale and his team provided updates on both those efforts, committee co-chair Sen. Daniel Hemmert, R-Orem said the conversation about what, if any, overlap is occurring would be placed on hold until the committee's October meeting.
"The governor's office is working on a deal that covers the USTAR questions," Hemmert said. "They should have something for us to review in anticipation of (the October meeting)."
