Council Provided Information - 12/12/2023 (2)1
BOARD STAFF REPORT
THE REDEVELOPMENT AGENCY of SALT LAKE CITY
TO:RDA Board Members
FROM: Allison Rowland
Budget & Policy Analyst
DATE:December 12, 2023
RE: RESOLUTION: 900 SOUTH HOUSING AND TRANSIT REINVESTMENT ZONE AND
INTERLOCAL AGREEMENT
ISSUE AT-A-GLANCE
The Board will receive a briefing on a proposed 900 South Housing and Transit Reinvestment Zone (HTRZ),
along with the corresponding draft Interlocal Agreement between the RDA and Salt Lake City Corporation. This
first HTRZ would include the rapidly growing areas of the Granary District, Central Ninth, and part of
Downtown, totaling 175 non-contiguous parcels on nearly 98 acres. The 200 West/900 South HTRZ Proposal
(transmittal Attachment B) was initially submitted to the State HTRZ Committee in April 2023 and was
resubmitted in July after a request to include additional acreage. It was conditionally approved on November 8.
RDA support for this project area would help create denser, transit-oriented development, resulting in an
improved mixed-use neighborhood with varying levels of housing affordability. The estimated number of new
housing units would reach 10,214 and include over 2,000 new units affordable at 60% AMI or less. (AMI refers
to Average Median Income, which is set annually by HUD, the U.S. Department of Housing and Urban
Development). RDA involvement would also result in better air quality for the neighborhood—and the whole
region—than would be the case without it.
Next steps:
•At the date of this writing, the RDA continues to discuss a provision of the HTRZ Committee approval
with the Utah Tax Commission, Salt Lake County, and other taxing entities (see section A3 below). Final
Committee approval is contingent on identifying a “workable collection and assessment process” for the
partnership agreements. The RDA must also submit a partnership agreement to the Governor’s Office of
Economic Opportunity which includes removal of taxing levies from multi-county and Salt Lake County
assessing and collecting.
Item Schedule:
Briefing: December 12, 2023
Set Date: n/a
Public Hearing: n/a
Potential Action: TBD
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•For a future RDA Board meeting, RDA staff plans to transmit a final version of a resolution to approve
the 900 South HTRZ interlocal agreement between the City and RDA for the Board’s consideration; a
draft is included in Attachment A of the transmittal for the December meeting.
•Following RDA adoption of the interlocal agreement, an ordinance approving the interlocal agreement
would be transmitted to the Council.
Goal of the briefing: Review and discuss plans for the proposed 900 South HTRZ (Housing and Transit
Reinvestment Zone), and the corresponding draft interlocal agreement.
ADDITIONAL INFORMATION
A.Background
1.New State Law. In recent years, State law was modified to allow municipalities to establish Housing
and Transit Reinvestment Zone (HTRZ) project areas around public transit facilities. The goal is to
facilitate construction of denser mixed-use affordable housing, beyond what market conditions would
typically encourage, and increase public transit use. Taxing entities would continue to receive the same
amount of tax revenue that was generated before the creation of the HTRZ, and a share of the growing
tax receipts can be used by the City to help fund increased infrastructure, other transportation needs,
and water conservation in the area. These project areas are subject to different requirements than
traditional RDA project areas and regulated by a separate section of State Code.
2.State Conditions on RDA Proposal. The 200 West/900 South HTRZ Proposal (transmittal
Attachment B) was submitted to the State HTRZ Committee in July 2023, and was conditionally
approved in November. Staff note: These items are technical steps that are a result of this application
being one of the first HTRZ applications to go through the full implementation process. The conditions
include:
a. That RDA staff comes to agreement with the Utah Tax Commission, Salt Lake County, and other
taxing entities, identifying a “workable collection and assessment process” for the partnership
agreements. If an agreement is not reached before the January RDA meeting, staff will delay the
Board and City Council approval of the interlocal agreement to a subsequent meeting.
b. That RDA staff submits a partnership agreement to the Governor’s Office of Economic
Opportunity which includes removal of taxing levies from multi-county and Salt Lake County
assessing and collecting.
In addition, the HTRZ Committee requested that, in contrast to the three-phase plan submitted for
review, the RDA wait until after 2025 to begin to collect increment, so that collection can be in one
phase rather than three. For now, the plan’s base year remains 2022, but the Tax Commission and
County may request further conversation about this. Finally, depending on when the HTRZ is triggered,
developers that enter tax increment reimbursement agreements with the RDA may begin collection in a
different year than they had initially anticipated.
3.Participating Entities. The taxing entities that are participating in the 900 South HTRZ, as of the
date of the transmittal, include the following:
Salt Lake City
Salt Lake County
Salt Lake City School District
Salt Lake City Library
Salt Lake Metropolitan Water District
Salt Lake City Mosquito Abatement District
Central Utah Water Conservancy District
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B.The 900 South HTRZ Proposal
1.Area Description and Plans. The RDA’s first HTRZ application includes the Granary District,
Central Ninth and part of Downtown and would include 175 non-contiguous parcels on nearly 98 acres.
(Staff notes: Unlike HTRZs, in traditional RDA Community Redevelopment Areas, parcels must be
contiguous. Also, the 900 South HTRZ Plan in the transmittal mentions 177 parcels, but RDA staff
indicated that the correct number is 175.) This area has a lower density than other downtown-adjacent
neighborhoods, but it is currently undergoing rapid growth and change.
Because it was historically a warehouse and industrial area, it does not contain the infrastructure typical
of residential and commercial parts of the City, like sidewalks, street trees, curbs, and gutters. In
addition, many streets need to be rebuilt, and water lines expanded, to meet additional demands that
will be caused by new uses and greater residential populations. Funding would also be needed for the
planned Grand Boulevard improvements and sections of the Green Loop “linear park” in this proposed
HTRZ. RDA staff commented that other City departments are leading on these projects, but they
anticipate that some HTRZ tax increment will be requested to financially support them.
Many of the public projects needed to transform this area were identified in City plans adopted in a
number of years ago, including the Downtown Plan (2016) and the Granary District Alliance’s Rails to
Revitalization report (2019). Another is the Utah Transit Authority Future of Light Rail Study (2022).
The transmittal’s Exhibit C: Granary Infrastructure Improvements (page 33) includes a map of where
pavement, water mains and overhead transmission lines are targeted for improvement. The transmittal
notes that in this area, limited funding for public infrastructure projects has resulted in these not being
completed at the rate needed to support transit-oriented development.
➢Policy Question: The Board may wish to ask for additional detail on the timing for
these major City projects, including current budget estimates.
➢Policy Question: The Board may wish to request updated analyses of pavement and
utility provision needs, along with estimated costs and funding sources for
improvements.
2.Future Land Uses. City support in the form of an HTRZ would ensure additional affordable housing
opportunities, transit-oriented development centered on the existing light rail stop at 200 West and 900
South, and better connections to other parts of the city. Current estimates are that 10,214 new housing
units will be built by private developers, using approximately 54% of the developable acreage. The
HTRZ Plan incorporates a mix of studios, one-bedroom, two-bedroom, three-bedroom units, and
townhomes with up to four bedrooms. Under existing policy, the City could leverage support to ensure
that 2,034 or more of these units are affordable to households earning 60% or less of Area Median
Income (AMI). For example, it could tap the Housing Development Loan Program to support the
development of affordable housing within the HTRZ.
Other land uses for the area would include commercial, office, hotel, and structured parking. The
Construction Gap Analysis (page 7 of the Proposal) provides specific information on a potential benefit
of public support for structured parking, which is a relatively expensive project element:
“[…] without tax increment support, at least 30% of the total land area within the
HTRZ would need to be reserved for right-of-way area and surface parking, as
opposed to only 15% if public funds were available to support the increased costs
associated with building more efficient parking structures. Structured parking [as
opposed to surface parking] allows for more efficient land use as well as increased
green space.”
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C.Terms of the 900 South HTRZ Proposal
1.Tax Increment. Under the proposed interlocal agreement between the City and the RDA, the latter
would receive a maximum of 80% of the tax increment from the project area for a term of 15 years. This
would be used according to the HTRZ Plan approved by the State Housing and Transit Reinvestment
Zone Committee. The tax increment collection period may be extended for a total of 17 years should
State law be amended to allow for this longer collection period.
Tax increment collection would be triggered when the City provides notice to the State that collection is
beginning, and it would use 2022 as the base taxable value. RDA staff proposes that a project which
meets the threshold criteria (see attachment C1) would provide the developer 60% of the tax increment
collected. An additional 10% increment, reaching up to 90%, could be included to reflect each additional
public benefit incorporated into the project. This would include those related to the level and amount of
affordable housing in a project. Non-housing projects would have to meet at least two of the RDA’s
qualifying livability benchmarks.
➢Policy Question: The Board may wish to ask RDA staff whether and how a later
implementation date than originally planned for the HTRZ may impact potential tax
increment agreements and developers who may have anticipated a more immediate
implementation schedule.
2.Public Benefits. The public benefits provided by private development projects must meet RDA
standards, including its Sustainable Development Policy, which requires the use of on-site renewable
energy to supply at least 50% of the building’s annual energy consumption. They must also include
activated ground floor space.
Examples of additional potential public benefits include:
- Affordable housing (see details below)
- Structured parking
- Public art and enhanced building design
-Livability: incorporation of public green space, affordable commercial space, or adaptive
reuse of historic structures.
3.Affordable Housing. For the 900 South HTRZ, the RDA proposes to exceed the State-mandated
minimum of 10% of housing units being deed-restricted to 80% AMI. Instead, 20% of the 10,214
dwelling units projected to be constructed within the area (2,043) would be affordable at 60% AMI, and
mixed-income projects would have even higher shares of affordable units.
ATTACHMENT
Attachment C1. Threshold Criteria. (Staff note: These criteria are listed in the December 12, 2023, staff report
entitled Proposed Housing and Transit Reinvestment Zone (HTRZ) Tax Increment Reimbursement Policy, and
subject to change until adopted by the Board.)
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Attachment C1. Threshold Criteria.
(Staff note: These criteria are listed in the December 12, 2023, staff report entitled Proposed Housing and
Transit Reinvestment Zone (HTRZ) Tax Increment Reimbursement Policy, and subject to change until adopted
by the Board.)
A.Project Thresholds. Two different thresholds would apply, depending on whether a project would
incorporate housing or not.
1.Projects that Incorporate Housing. To be eligible for HTRZ tax increment revenue, projects must
comply with all of the following. Additional requirements for affordable housing are found in section C,
below.
a. meet all applicable standards and objectives of the HTRZ Act and the approved HTRZ.
b. include at least 10% of housing units that are affordable to those earning 60% of the Area
Median Income (AMI) or less. Alternatively, 20% of units must be affordable to those earning
80% AMI and below. Income averaging of units within a single project is permitted to achieve
AMI thresholds.
c. include activated ground floor space (a minimum of 50% of all ground floor, street-facing
building facades), or a private residence.
d. comply with the RDA’s Sustainable Development Policy.
e. provide sufficient evidence that tax increment funding is necessary for the project to succeed
and to verify that the request is reasonable.
2.Threshold Requirements of Projects that Do Not Incorporate Housing. These projects would
be required to:
a. meet all applicable standards and objectives of the HTRZ Act and the approved HTRZ.
b. meet at least two of the RDA’s qualifying livability benchmarks:
•permanent job
creation
•affordable
commercial spaces
•ownership
•transportation
opportunities
•neighborhood safety
•community engagement
and support
•public art
•public space
•walkability
•building preservation,
rehabilitation, or adaptive
reuse.
c. include activated ground floor space.
d. comply with the RDA’s Sustainable Development Policy.
e. provide sufficient evidence that tax increment funding is necessary for the project to succeed
and to verify that the request is reasonable.
B.Affordable Housing Requirements.
1.Deed Restriction. A restriction would require continued use of the specified units as affordable
housing for at least 30 years. Both rent and income restrictions would be included.
2.Bedroom Count Mix. The affordable units must be located on different floors of the building and be
spread among bedroom counts (1-bedroom, 2-bedroom, 3-bedroom, etc.) in the same proportion as the
units available within the rest of the project.
9 0 0 S O U T H H T R Z
I N T E R L O C A L A G R E E M E N T
R D A B O A R D M E E T I N G
D E C E M B E R 1 2 , 2 0 2 3
9 0 0 S o u t h H T R Z : C o n d i t i o n a l A p p r o v a l
CONDITIONAL APPROVAL:
The Housing and Transit Reinvestment Zone
Committee approves the project, as presented to
the committee, located within ½ mile of the TRAX
stop at 200 West and 900 South for the duration of
15 years or up to 17 years as allowed by statute for
a maximum capture of 80% property, sales and use
tax increment with the requirement of 20% of
affordable housing, averaging 60% of AMI,
estimated at $357 million.
Contingent on Salt Lake City will work with County
Auditors, Utah State Tax Commission and other
taxing partners to identify a workable collection and
assessment process and submits a partnership
agreement to the Governor’s Office of Economic
Opportunity. Includes the removal of taxing levies
of the increment of multi county assessing and
collecting and county assessing and collecting.
9 0 0 S o u t h H T R Z : T e r m s & P l a n O v e r v i e w
HTRZ TERMS:
Light Rail Stop: 200 West & 900 South
Acreage: 97.72
Base Year: 2022
Base Year Value: $212.3 million
Participation Rate: 80%
Collection Period: 1 phase of 15 years*
Use of Funds:
Private Development Support (60%)
Public Development Support (39%)
RDA Administrative Costs (1%)
PLANS INCORPORATED IN THE 900 SOUTH HTRZ:
The Downtown Plan
UTA Light Rail Strategic Plan
Rails to Revitalization
9 0 0 S o u t h H T R Z : D e v e l o p m e n t S u p p o r t
PROJECTED LAND USES:
Commercial: 1.1 million SF
Office: 1.9 million SF
Hotel Rooms: 2022
Structured Parking Stalls: 3,596
Housing Units: 10,214
Affordable Housing Units: 2,043
FOCUS OF DEVELOPMENT SUPPORT:
Affordable Housing
Utility Improvements
Streetscape & Safety Improvements
Sustainable Building Construction
Structured Parking
Public Art & Enhanced Building Design
Public Transit Support
Additional Public Benefits
900 South HTRZ: Tentative Schedule
DECEMBER 2023:
RDA Board: Briefing regarding the 900 South HTRZ Interlocal Agreement
JANUARY 2024:
Negotiations continue with Salt Lake County and the Utah State Tax Commission
FUTURE MEETINGS:
RDA Board: Resolution transmitted to RDA Board to consider approving 900 South HTRZ
Interlocal Agreement between the City and the RDA
City Council: Ordinance transmitted to the City Council to consider approving the Interlocal
Agreement between the City and the RDA