House tightens redevelopment law, limits eminent domain and creates taxing-agency approval

The Utah House passed House Bill 278 on Feb. 24, a package of reforms aimed at curbing perceived abuses by redevelopment agencies while preserving tools for economic development.

Sponsor Representative Garn (presented as "Garn" on the floor) said the bill was the product of a year-long effort that tightened the state—s blight standard so that an area must be shown to be "unfit or unsafe to occupy" and added hazardous or solid waste as factors. "This bill tightens the blight definition dramatically," the sponsor said on the floor, and it also requires at least 50% of parcels in a proposed project area to have existing improvements, to prevent vacant land from being labeled blighted.

Other provisions increase notice to property owners (certified mail and notice to contiguous owners within 300 feet), require a property-owner rights summary, and reduce the period during which an agency may exercise eminent domain from seven to five years. The bill creates a seven-member taxing-agency committee (two school board members, two city members, two county members and one state school board member) to approve tax-increment budgets for new projects.

Floor debate included multiple amendments: Representative Reebing moved a substitute to shift the placement of a prohibition on eminent-domain uses; Representative Harland proposed language that places the burden of proof for blight on the redevelopment agency and creates a 30-day judicial appeal window; Representative Cunningham added a requirement that properties on the National Register receive state-historic-preservation consideration. Representative Hunter moved to delete a section authorizing up to 20% of tax-increment funds for housing, saying the provision could create a new government program; that proposed deletion failed after division. Representative Valentine and others urged the House to resist eliminating the housing flexibility, describing the bill as a compromise.

The House recorded passage of HB278; the clerk announced the bill will be sent to the Senate for further consideration. Supporters said the changes strike a balance between protecting private property and preserving limited redevelopment tools; opponents pressed limits on housing-fund flexibility and expressed concern about potential displacement and administrative scope.

Next steps include assignment to the Senate for consideration and any committee work required there.