SI Vault
Donald L. Barlett
December 10, 2001
Thanks to Utah politicians and the 2002 Olympics, a blizzard of federal money—a stunning $1.5 billion—has fallen on the state, enriching some already wealthy businessmen
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December 10, 2001

Snow Job

Thanks to Utah politicians and the 2002 Olympics, a blizzard of federal money—a stunning $1.5 billion—has fallen on the state, enriching some already wealthy businessmen

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Robert Earl Holding, a 75-year-old oil billionaire—ranked 236th on the Forbes 400 list of richest Americans—and owner of Snowbasin, a ski area that will host the downhill, Super G and combined events.

Ian Cumming, 61, chairman of a holding company, whose family owns Park City Mountain Resort, which will be the venue for snowboarding and giant slalom skiing.

Edgar Stern Jr., a 79-year-old hotelier and majority owner of Deer Valley, site of freestyle and slalom skiing.

Roger Penske, a 64-year-old racing-car magnate and minority owner of Deer Valley.

Myers, or C.C., as he's known, may be the most colorful of the bunch. Standing 6'5" without his ostrich-skin boots on and weighing almost 300 pounds, he became a California folk hero in 1994 when his construction company rebuilt a stretch of the Santa Monica Freeway—heavily damaged by that year's Northridge earthquake—10 weeks ahead of schedule. The feat earned him deification by Rush Limbaugh and a $14.8 million bonus from the state.

In the summer of 1990 Myers took a majority stake in a newly formed partnership called the Summit Ranch Joint Venture, whose goal was to develop a 1,136-acre tract on and adjacent to a mountain at Kimball Junction in Utah. This was no ordinary mountain: Only a few weeks earlier the state had selected it as the site of a winter sports park that would include ski jumps and a bobsled and luge run. The facility would become Utah Olympic Park.

In October 1990, in what was hailed as an act of great generosity, Myers signed an agreement with Utah officials to give 386 acres of his partnership's tract to the Summit County Municipal Building Authority as the site for the sports park. The gift, however, had strings attached. In exchange for the property the Utah Sports Authority, a state agency overseeing construction of Olympic facilities, agreed to build an access road to the sports park that would run through Summit Ranch's remaining 750 acres, opening the area to the development of single-family homes and condos. In addition the sports authority pledged to install "all necessary utilities, including electrical power, natural gas, telephone, water system and sewer," to serve both the sports park and the 700 residences proposed by Myers.

But how to pay for a road for a private developer so that the funding wouldn't look like Olympic money? Or worse, wouldn't be—or even appear to be—state tax dollars? Not to worry. Cash was available from the Utah Permanent Community Impact Fund. The source of the fund's money: the federal government.

The U.S. Treasury collects royalties from mining and petroleum companies that prospect and drill on federal lands, and from individuals and businesses that buy and sell the related leases. The Treasury returns half the payments to the states where the lands are located. States generally distribute the money as grants or loans to those communities that have been socially or economically affected by prospecting or drilling. In Utah this money traditionally has gone to struggling counties to help with public needs, like purchasing a fire truck.

Now the state was going to give $2 million in federal royalties to Summit County—by far the state's richest county, and one in which a majority of the mines closed years ago—and the money would be in the form of an outright grant rather than a loan, even though the fund's rules state that grants can be made "only when the other financing mechanisms cannot be utilized, where no reasonable method of repayment can be identified, or in emergency situations regarding public health and/or safety." On top of that the grant was earmarked for construction of a road that would benefit a private developer.

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