Senate advances bill to create rural development loan/grant fund with $5 million target

SALT LAKE CITY — The Utah Senate advanced legislation on Feb. 14 to create a loan and grant fund intended to spur economic development in the state’s smaller counties.

Sen. Knudson, sponsor of Senate Bill 57, described amendments that move responsibility for managing the proposed loan/grant fund from the Division of Finance to the Department of Business and Economic Development, consistent with the bill’s aim. He said the program would target third‑through‑sixth class counties and fund infrastructure improvements designed to encourage economic development in communities with deteriorated infrastructure.

On the funding mechanics, the sponsor said the intent is a revolving $5,000,000 fund. "The appropriation of $5,000,000 is the level that we would like to see this fund kept at," he told the Senate. He described the fund as a mix of loans (to be repaid into the revolving fund) and grants that must meet specified criteria. The bill also limits an individual loan to a maximum of $750,000.

Senators pressed for detail on the fiscal note and how the appropriation and ongoing support would work. One senator noted the fiscal note was not available on the computer during floor consideration, leaving some procedural and appropriation mechanics unclear. Senator Mansell questioned whether the bill duplicated the Community Investment Board’s (CIB) work and asked why additional resources were needed instead of expanding that existing program.

Supporters said the bill targets smaller rural counties more directly than other statewide programs and provides a specific mechanism and criteria for awarding grants or loans. The sponsor agreed to clarify the fiscal language before the bill moves beyond the third‑reading calendar.

The Senate voted to consider SB 57 for third reading and then recorded a roll call indicating it would be read for the third time (27 yes, 0 no, 2 absent). The measure will return for a third‑reading vote and possible final passage.

Key details discussed on the floor included the $5,000,000 target for the revolving fund, an explanation that some awards would be loans to be repaid into the fund while others could be grants, and a maximum loan amount of $750,000 per project. The sponsor said he would follow up to ensure the fiscal note and appropriation language reflect the stated intent.

The Senate also signaled additional scrutiny ahead of final passage to determine how SB 57 would interact with existing state investment programs and whether the appropriation will be structured as an initial capital infusion plus an ongoing mechanism to maintain the $5 million level.