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Draper leaders are considering offering a big carrot — worth potentially millions of dollars ­— to attract two Larry H. Miller car dealerships to the growing Salt Lake Valley city.

A proposal to the City Council offers the company 50 percent of all sales-tax revenue the city would see from the addition of the dealerships. The council is scheduled to vote on the deal Tuesday.

That tax incentive is worth up to $900,000 per year, based on owner estimates of sales — and it is about twice as generous as what cities commonly offer, according to an economic development expert familiar with such agreements. He asked not to be named because of his employment with another Utah city.

Draper Community Development Director Keith Morey declined the Tribune's interview request Monday. But in a prepared statement emailed to the newspaper, he said the "proposed incentive agreement ... would potentially attract a dealership relocation to the city. In an effort to assist in the relocation, Draper City is considering an agreement that would allow Draper to share a portion of the sales tax generated by the dealership over the next 10 years."

It's the kind of deal revenue-hungry cities strike to attract big retailers. That's because the state's tax distribution formula awards a portion of the revenue based on location of the retailer.

Critics say such deals don't really qualify as economic development, because they don't create new jobs or expand economic activity — they only lure it away from one community for the benefit of another.

"For us, this is just a zero-sum game. These cities are just looking for ways to take businesses from one another by giving these incentives," said Utah Taxpayers Association Vice President Billy Hesterman.

"They claim it's for economic good, but all they're doing is moving where economic activity is happening, you know, 10 miles down the road, into their city. And that's not for the greater benefit of all the community," he said. "We frown on this. We don't think this is beneficial."

The proposal coming before the City Council doesn't specify in which community the business is now located. Nor does it say what make of vehicle would be sold at the new dealerships.

Utah law gives existing dealerships veto power over the location of a competitor offering the same make of vehicles within a 5-mile radius.

Miller Family Real Estate LLC — listed as the developer of the project that would include two retail vehicle sales facilities and an office building — estimates the project would generate between $50 million and $180 million in annual sales. Draper's share of sales tax would be about 1 percent of that, or between $500,000 and $1.8 million.

Under the proposal, the city would turn over half the tax proceeds to the company for the 10-year period of the agreement.

The deal is contingent on construction beginning by Dec. 31, 2016, and having one dealership open for business by July 1, 2017. The second would be open by 2021.

Hesterman said the Taxpayers Association is working with some lawmakers on legislation that would prohibit local governments from approving property-tax incentives on redevelopment deals involving retail businesses. He said proposed sales-tax incentives for retail is another area that should be looked at, based on similar principles.

Such incentives make sense "when you're bringing in new major economic activity, such as plants or some type of thing that will create new jobs," Hesterman said. "That's not what we're seeing here — this is just trying to take business from one area and bring it into your town."

These concerns are similar to ones expressed recently by Draper Mayor Troy Walker when talking about his hopes for a new high-tech business center on the site of the old prison that is planned for relocation to western Salt Lake City.

The short-sighted thing for his city to do would be to push for retail business on the 680-acre site "because that's what our city's lifeblood is," Walker said last week on Trib Talk, the Tribune's online interview and discussion program.

"If you just get Costco to locate here and take it out of some other city, that doesn't really, that's not a net gain. But good-paying jobs and economic stimulation, that ultimately trickles down to us and that's why I think it's time to change the conversation," Walker said.