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The state will not provide a $33 million sales-tax subsidy for a convention-center hotel in downtown Salt Lake City.

By a 39-35 vote Thursday night, the House rejected SB267, which would have given the developer of a megahotel a rebate on all of the new sales taxes collected there for the first 20 years of its operation — about $33 million. That sum would have been matched by Salt Lake City and Salt Lake County, adding to a $100 million public investment in what was projected to be a $300 million venture adjacent to the Salt Palace Convention Center.

Opponents argued it was bad public policy to subsidize a new hotel to the detriment of its competitors, the numerous downtown hotels that have supported the community for years. Backers contended the hotel would generate enough new business that those other hotels also would benefit in the long run.

Mike Gorrell