Legislative showdown erupts over Fairpark, soccer stadium deal

(by Amy Joi O'Donoghue deseretnews.com 2-16-15)

A political impasse at the Utah Legislature has thrown the possibility of a new $18 million minor league soccer stadium at the Utah State Fairpark into question.

Fair park officials need a lease from the state for the grounds and buildings that extends up to 50 years to provide certainty for the Real Monarchs and its owner, Dell Loy Hansen. The current lease expires in 2017, and has a 30-day cancellation notice.

Although the state agency in charge of the property — the Utah Division of Facilities and Construction Management — was authorized to enter into a lease for the grounds with the state fair park board in 2010, no action was taken.

Now, five years of inaction on the lease has boiled over into urgency, with the soccer deal looming.
Sen. Scott Jenkins, R-Plain City, said his colleagues in the House are worried about a sweetheart deal.

"There seems to be some friction between the House and this proposal and I don't know why," he said. "Some think this is a sweetheart deal for the developer, but on the other hand this is the only deal that has come by in 25 years that did not expect the state to spend money."

Last week, he urged his colleagues on the Natural Resources, Agriculture and Environment Committee to sign off on a letter to the executive branch and to leadership urging the lease be signed.

House members voted no, and the proposal for the letter died.

"I am at the height of my frustration now," Jenkins said. "As Forrest Gump said, 'Stupid is as stupid does.' The fact of the matter is they are convinced there is a better deal out there...but we are going to watch this deal walk away."

Representatives of Gov. Gary Herbert's office have not said why a long-term lease has not been signed for the Utah State Fairpark but Mike Steele, fair park director, said he's been told it's up to the Utah Legislature.

"When I met with the governor's staff, they said this was a policy issue." Steele said. "The House and the Senate need to decide which way the fair goes. Does the state invest here, does the state keep the fair or does it do something else? The executive branch is looking to the Legislature to make a policy decision on what happens to this institution."

On Friday, Herbert's office released a statement after a request by the media. “The governor appreciates the thoughtful proposal put forward by a local developer and looks forward to reviewing it further," Marty Carpenter, Herbert's spokesman, said.

"The governor and his staff are working with the Legislature to ensure the ultimate resolution for the State Fairpark has buy-in from both the legislative and executive branches. The State Fair will only be successful if both branches agree on the best path forward.”

Last month, Utah State Fairpark officials and Hansen announced they had signed a short-term agreement for the construction of an $18 million, 8,000-seat soccer stadium at the fair park.

Hansen's minor league soccer team, the Monarchs, will begin its inaugural season this year, and to expedite the stadium's construction, Hansen agreed to pay the entire cost for the stadium, rather than solicit help through a private-public partnership.

Under the provisions of the short-term arrangement, Real Monarchs would pay a guaranteed $3.3 million over 20 years for lease of the space at the park and split half the net parking revenues with the State Fairpark. In addition, the state fairpark would get use of the stadium for three weeks out of the year and guarantee a certain number of parking slots. The deal is good until April 23.

At the time the deal was announced, Lowell Peterson, the fair park's vice chairman of the board, said the only major hurdle to construction of the new stadium is the extension of the lease for 40 years. The current lease is set to expire in 2017, which Steele said is already interfering with his ability to book events.

"We have a convention that wants to book. We have a motorcycle group that wants to book a rally in July 2017, but we can't sign an agreement with them," Steele said. "Everything is shrouded in a cloud of uncertainty."

The Utah Legislature has been struggling with what to do with the State Fairpark site. Although the 11-day fair makes money, it is not enough to keep the entire facility operationally viable. A planned rodeo stadium was never completed, and buildings have fallen into disrepair because of decades of neglected maintenance.

A consultant's study looked at a variety of possible "best" uses for the site, reaching out to a number of stakeholder groups that include West side neighborhoods, potential developers, the Utah Farm Bureau and others.

The land use study concluded if the state wanted to move the state fair and replace the buildings at a comparable level, it would cost up to $160 million. To hang onto the facility would require an investment of $47 million long-term.

The state fair park corporation is an independent nonprofit public corporation created in the 2011 legislative session as an entity outside of state government so it could pursue profitable ventures for the site.

"Our committee cannot continue to subsidize this with general funds, which is the reason it was spun off. It was designed to be a self-sustaining operation," said Sen. Dave Hinkins, R-Orangeville and co-chair of the Natural Resources, Agriculture and Environmental Quality Appropriations Subcommittee.

"We can't tell them they need to be stand alone and not allow them the flexibility to do that. We have got to give them the flexibility to make a decision and make it profitable so they aren't subsidized by the general fund."

Hinkins said the lease is being "held hostage" which frustrates him because he believes most lawmakers want a viable state fair to continue at its current location.

"We have all agreed we want to bring rural Utah here," he said. "We want to bring rural Utah here because the people who live in the cities are not going to go out to the farms. We want to showcase rural Utah in the metropolitan area."

Hansen, for his part, has resisted any temptation to get involved in the politics on the Hill, turning down lobbyist offers to shop the stadium before legislators.

"The proposal stands on its own merits," he said.

Rep. Stephen Handy, R-Layton, was one of the no-votes on the committee, even though he said he likes the idea of a soccer stadium at the fairgrounds.

"There are some internal problems. It is in a holding pattern. We are going to retain the state fair, but we were just told to put the brakes on this for now. It is one of those political things. It kinda stinks, but you just go with it temporarily."