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FEATURE STORY

$9 Billion in Public and Private Investment Build-out Occurring Across Utah; $330 Million in VC Investments

Utah is enjoying a massive build-out, with over $9 billion in current and announced capital infrastructure investments statewide. That's the report from the Governor's Office of Economic Development (GOED), which recently completed a state-wide capital infrastructure investment survey of state agencies, county and local governments, and private industry for the past 18-month period ending June 1, 2006.

Over the same period Utah companies captured a total of $330 million in venture capital investment involving 40 deals, according to the "Shaking the MoneyTree" report, released Monday by PricewaterhouseCoopers.

Jason Perry, GOED's executive director, says his office reviewed 10 areas for capital investment. The following table summarizes the total capital infrastructure investments, current and announced.
 

Road and rail transportation	$2.77 billion
Airports	$220.9 million
Power plants and power transmission	$949.3 million
Water and sewer	$1.1 billion
State and local capital improvements	$142.2 million
Higher education	$757.3 million
Public education	$323.1 million
Telecommunications	$547.9 million
Private sector industrial and commercial construction	$2.875 billion
Other notable	$662 million

Road and Rail Transportation Projects

Construction projects underway as reported by the Utah Department of Transportation (UDOT) and county/local governments amount to $653.9 million, with another $918 million announced (this includes the Legacy Parkway, and I-15 expansion in Weber County). The Utah Transit Authority (UTA) has invested $625.7 million in light and heavy rail expansion, with another $580 million announced.

"The major expansion undertaken by UTA is for heavy commuter rail service, branded as Frontrunner, which will run from Ogden to Salt Lake City and is expected to begin service in 2007," according to the UTA.

Airports

According to the survey, state-wide airport expansion projects over the past 18 months totaled $100.9 million. These projects included work at the Salt Lake International Airport and the new St. George airport. Another $120 million in airport projects have been announced, for a total of $220.9 million in current and announced airport projects.

Power Plants and Power Transmission

Rocky Mountain Power (formerly Utah Power & Light), has undertaken a $930.3 million expansion of its power plant, transmission, and distribution operations, according to the survey, while St. George is investing $19 million in new construction for a gas turbine power plant.

Water and Sewer

Water and sewer projects seem to be occurring in every community across the state, however the two largest projects are the Lake Powell and Bear River pipelines. Total water and sewer infrastructure investment: $1.1 billion.

State and Local Government

This category includes a wide array of infrastructure investment projects, according to the Governor's Office of Planning and Budget (GOPB): correction and court buildings, liquor stores, fish hatcheries, veteran and military services buildings, convention center and business center expansion. Total state and local government capital infrastructure investments: $142.2 million.

Higher Education

Capital infrastructure investments in higher education include new health sciences buildings at Salt Lake Community College and Dixie State College, a fine arts complex at the College of Eastern Utah, and construction at Utah State University and the University of Utah. Total capital investment: $757.3 million ($304.4 million underway and $452.8 million announced).

Public Education

The $323.1 million in public education capital infrastructure investments will add 3.4 million square feet of space for educating Utah's children. The investments include construction of elementary, middle, charter, and high schools.

"With regard to education facilities, both Higher Ed and Public Ed are clearly funding capital expansion across the state," Perry says.

Telecommunications

State-wide government and private sector telecommunications infrastructure investment projects underway total $207.9 million, with another $340 million announced. Both government and private sectors are being very careful to ensure we have adequate power and telecommunication connectivity to support the state's growing population and economic expansion, according to the survey.

Private Sector Industrial and Commercial Construction

Statewide commercial and office construction totals $1.375 billion, of which more than $1 billion is for class A office space and another $329.6 million is for general industrial space. The rebuild of Salt Lake City's central business district, including the malls, offices, and housing, is estimated at $1.5 billion, according to economic development research conducted by the U of U.

Other Notable Investments

"There are some significantly notable special projects going on," says Perry. One of which is the new, $362 million Intermountain Medical Center under construction in Murray by Intermountain Health Care. The combined construction of other notables, like the Miller Sports Park, improvements to state parks, and hotel and resort construction, total $301 million across the state.

Venture Capital Investment

Regarding venture capital investments, Joe Strain, a manager in PricewaterhouseCoopers' Salt Lake Office, says Utah companies captured $249 million in VC funding during 2005. Year to date, Utah has captured $81 million in 13 deals as compared to its neighbors: Arizona with 16 deals totaling $96 million; Nevada with three deals totaling $10 million; Wyoming with one deal for $6.5 million; Colorado with 45 deals totaling $230 million; and New Mexico with five deals totaling $10 million. Idaho has had no VC investments year-to-date.

Strain says four Utah companies received approximately $21.4 million during the second quarter 2006. Those companies were: iArchives, Inc. with $1.99 million; Oakley Networks with $12 million; Vision Bankcard, Inc. with $7 million; and Linux NetworX, Inc. with $400,000.

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IN THE NEWS

Economic Development Headlines

Scott USA Completes Move to Ogden

- Outdoor sports equipment manufacturer Scott USA has completed its move from Clearfield to Business Depot Ogden, where it has established its North American distribution headquarters in a new 400,000-square-foot building. (Standard-Examiner)

Davis Conference Site Short $1M

- Davis County needs just over $1 million from the city of Layton to expand the Davis Conference Center. The expansion, with a $13.2 million price tag, is nearly funded - through a county hotel-room tax, a legislative grant and future county bonds. But the county is short about $1 million needed to complete the financing. (Morning News)

Tourney Hits a Home Run

- An infusion of teenage softball stars on Park City's Main Street this month means millions of dollars to local businesses. As the Premier Resorts Triple Crown Girls Fastpitch World Series finishes up the second week of the three-week tournament, the 275 teams of 10- to 18-year-old girls and their families and friends will pour roughly $7 million to $8 million into Park City's economy. (Morning News)

Firms Bring Job Growth to Weber County

- The expansion plans of two manufacturing firms could bring nearly 300 new jobs to Weber County, city and state officials say. Kimberly-Clark Corp. has begun construction on a 87,000-square-foot expansion of its existing "Huggies" diaper manufacturing plant in Ogden, plant manager Phillip Senn said. (ABC 4)

U.S. Foodservice, GOED Restructure $2 Million State Incentive for Expansion

- The Business and Economic Development Board of the Governor's Office of Economic Development (GOED) approved a restructure of a previously approved state incentive of $2 million for U.S. Foodservice to expand its facility in Weber County. This expansion will generate approximately 225 new jobs for total employment between 450 and 475 jobs. (Utah Business Magazine) (Morning News) (Salt Lake Tribune)

LDS Project to Retain Woolen Mills

- Utah Woolen Mills will remain at its current South Temple location, and another piece has fallen into place in the shape-shifting puzzle called the LDS Church's downtown Salt Lake redevelopment project. (Morning News) (SL Tribune)

Southeast Asian Group Uses Visit to Build Utah Ties

- Representatives from the Association of Southeast Asian Nations visited Salt Lake City Wednesday, taking part in a trade forum to strengthen business ties between Utah and their region. (Morning News) (KUER) (SL Tribune) (Utah Business Magazine)

Panel Renews Income-Tax-Reform Hopes With a Dual-Tax Proposal

- Months after the failure of a year-long effort to get a tax-reform package through the Legislature, a committee started serious discussions Wednesday of a new effort, this time with a far less expansive proposal.
(SL Tribune)

Four Utah Tax Proposals Unveiled

- As many as three-quarters of Utah taxpayers could see a reduction in the amount of income tax they pay, but no one would suffer a tax increase under four proposals introduced Wednesday to legislators. (Star Tribune)

Volkman Starts Term as President of Park City Chamber

- The president of Park City's third largest bank is also beginning his one-year term as the president of the Park City Chamber/Bureau. (Park Record)

Will Employment Market Cool Off?

- Utah's impressive job growth rate continued to accelerate in June, climbing to 4.8 percent for the year that ended June 30, the Utah Department of Workforce Services reported Tuesday. (SL Tribune) (Standard Examiner) (Morning News)

Nominees Sought for Awards in Science

- Nominations are due by Aug. 25 for the state's annual Governor's Medal for Science and Technology Awards.
(Morning News)

Utah's Economy Strong

- One of the most talked about issues the last several months--which we have all felt in our wallets--is the high costs of oil and gasoline. And that probably won't change anytime soon, but the bad energy news has overshadowed other positive economic news. Utah has been sitting pretty for quite a while!  (KSL)

Ogden's 'Junction' Construction Revs Up

- A key piece of The Junction, the mixed-use development under way at the former downtown mall site, is starting to take shape as crews have started construction of a new movie theater complex owned by Larry H. Miller Megaplex Theatres. (Standard Examiner)

Checketts Now Eyeing Geneva Site for His Real

- Dave Checketts isn't giving up yet. The Real Salt Lake owner spent two hours in Utah County on Friday, surveying the nearly 30 acres of free land in Utah County that developers there have offered him. (Morning News) (Daily Herald)

Utah County Developers Offer a Deal for Real Salt Lake

- Developers of the former Geneva Steel site want to buy the imperiled Major League Soccer team, rename it and move it to Utah County. The team's current owner has threatened to sell Real Salt Lake and move it out of state by Aug. 12 if a soccer-specific stadium-funding plan isn't hammered out by then. (Morning News)

Booming Economy Causes Growing Pains in Utah County

- Strong growth in the Utah County's business and real estate sectors has local executives in a variety of industries enthusiastic about the area's economic outlook. Utah County business representatives met Tuesday for an Economic Outlook roundtable sponsored by Utah Business magazine. Without exception they spoke of expanding businesses and the benefits of the new construction occurring in the county. (Utah Business Magazine)

Utah's Low Unemployment Rate Could Limit Growth

- Utah's economy is under pressure, with a job-growth rate near 5 percent and an unemployment rate poised to drop below 3 percent. The workforce, at virtually full employment, may not be able to sustain further job growth. (Utah Business Magazine)

Canopy to Develop Fifth High-Tech Office Building

- Canopy Properties plans to build a 95,000-square-foot high-tech office building in Lindon. This new project, called Canopy V, will be the first new building to be added to the Canopy campus in two years. (Utah Business Magazine)

Cottonwood Medical Plaza Sold for New Medical Condominium Project

- CB Richard Ellis announced Monday the sale of Cottonwood Medical Plaza, 5801 Fashion Blvd. in Murray. (Utah Business Magazine)

Cost of Living Steadily Rising Along Wasatch Front

- For the seventh straight month, the overall cost of living along the Wasatch Front went up - rising 0.6 percent in June - according to the Wells Fargo Wasatch Front area Cost of Living Report. (Utah Business Magazine)

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CALENDAR

August 30:  EDCUTAH Annual Meeting, Salt Lake City Marriot City Center

Aug. 10-13:  Outdoor Retailer Summer Market

Sept.: 13-15: Utah League of Cities and Towns (St. George)

Nov. 12-15: CoreNet Global Summit, (Orlando, FL.)

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