Lawmakers, local officials, attorneys and accountants from across Utah met privately last week to discuss the future of public infrastructure districts.
PIDs are frequently used by developers to get cheap financing for things like roads, water and wastewater infrastructure.
They do that by issuing bonds that only taxpayers within PID boundaries pay back. PIDs usually share the same boundaries as the development they’re attached to, since all the property owners must opt in.
The Utah Legislature designed PIDs so that the local governments, which create them, don’t have any liability.
But last August the unfinished golf resort in western Coalville Wohali — which has a PID — declared bankruptcy. Utah State Auditor Tina Cannon took notice.
Her office has directed Coalville to include the PID’s outstanding debt in its 2024 and 2025 financial documents, citing guidelines from the national Governmental Accounting Standards Board.
Justin Lee is the deputy director of the Utah League of Cities and Towns. Coalville’s situation has other governments concerned they’ll have to do the same.
“There's all kinds of concerns about whether or not we would be liable for something they did, or if they entered into bankruptcy, whether or not we'd have any kind of responsibility for that,” Lee told KPCW. “Our understanding was never that that would be the case.”
Wohali’s PID issued almost $35 million in debt, and the bankrupt developer had to get a court-approved loan to pay the PID. Cannon has told KPCW she’s concerned about who shoulders the responsibility for what a PID built, were it to fail.
Lee said local governments want to avoid the appearance of a liability — since state law says they’re not liable for PIDs. Some have issued hundreds of millions of dollars of debt, totalling almost $4 billion since 2019, according to Cannon.
Mayor Rory Swensen said at an April 13 city council meeting that Coalville disagrees with the auditor.
But the auditor’s office can impose its will on local governments by withholding money, such as sales tax revenue, if they don’t file correct financial reports.
“Coalville is important because it's the first time we've seen this interpretation,” Lee said. “So anyone that's got a PID certainly must be looking over the way they're reporting things and the way their audits are done to make sure they're not running the same situation.”
That’s essentially the same message the auditor sent in a March 19 memo to local governments. Cannon said she is not saying PIDs are liabilities.
Swensen said Coalville will look at reorganizing Wohali’s PID to ensure it doesn’t go down on the city’s future financial reports, including in FY2026.
“There is a growing recognition that the current interpretation may have unintended consequences for municipalities across Utah, and discussions are ongoing at multiple levels,” Swensen said.
Cannon said her office doesn’t have any financial stake in the debate over PIDs, which have exploded in popularity among developers.
Her office estimates there are more than 200 statewide, including at Deer Valley Resort’s East Village and Park City Mountain’s Canyons Village, although not all have issued debt.
“There are concerned parties in these situations who do make money off of these transactions. That's not the state auditor's office, and that's not our goal here,” Cannon said.
The bankrupt Wohali is scheduled for auction this month.
Lee said he wouldn’t be surprised to see new legislation clarifying the relationship between governments and their PIDs in a special session or the 2027 General Session.
