How PIDs Are Created (In Utah)

How does one go about setting up a public infrastructure district, you ask? 

Short answer: Residents, property owners, and the local municipality unanimously agree to establish a PID and then write up and adopt a governing document and appoint a board. 

Long answer: Utah law dictates a three-step process for establishing a PID.

1. Every PID in Utah Starts with a Petition

This petition can either originate from residents or from a development authority (i.e., the Utah Inland Port Authority, the Point of the Mountain State Land Authority, or a military installation development authority).

If it comes from the residents, then it must include signatures by 100% of property owners whose land would be included in the PID and by 100% of registered voters living in the area to be included. 

If it comes from a development authority, the petition needs only signatures from 100% of the affected property owners.

This petition—and subsequent steps—is headed by a “district applicant.” The district applicant is a member of the community who agrees to front the initial costs of setting up the PID (but may be reimbursed later) and spearhead the project.

Note: The city or town clerk should send a copy of the petition to the County Recorder within five days of receipt. See Utah State Code §17D-1-209(1).

2. Municipal Approval

The “creating entity” (the city or town authorizing the creation of the PID) must approve the petition and, along with it, a governing document negotiated between the municipality and the petitioners. 

The governing document should limit the powers of the PID and, at a minimum, include the following (required by §17D-4-202(7)): 

• A boundary description and a map of the PID;
• The number of board members;
• The divisions of the PID for board election purposes (if any);
• Any property tax rate maximums in the PID (additional to those of the county).
• Any limitations on the amount of debt the PID can take on; and
• Anything else required by the creating entity (cities may want to look at the credit worthiness of the district applicant, compliance with the city or town’s master plan, the PID’s finance plan, proposed development, and the district applicant’s track record).

It should be noted that the governing document can be amended at a future date with the consent of both the PID board and the creating entity. If an amendment changes the maximum property tax levy rate in the district, however, 100% of registered voters and surface property owners in the area must approve the amendment as well (§17D-4-202(8)).

3. Getting the PID Certified

The governing document, petition, and agreement between the creating entity and the PID should be filed with the Lieutenant Governor in accordance with Utah State Code §17B-1-215(1)(b)(iii). The PID will then receive a certificate of incorporation.

Within thirty days of receiving the certificate of incorporation, the PID board should record a notice with the County Recorder describing the boundaries of the PID and the maximum PID tax rate. The notice should also include a statement that a copy of the governing document is on file at the office of the creating entity and that the PID may finance and repay infrastructure and other improvements through the levy of a property tax (§17D-4-303(3)).