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SALT LAKE CITY — Based on repercussions other states have seen following passage of legislation targeting transgender residents, Utah could be looking at both short- and long-term economic fallout following the expected veto override of its own all-out ban on transgender female students participating on girls school sports teams.
Those potential economic consequences run the gamut and could include business boycotts, travel bans, cancellation of conferences and sporting events, and the elimination of future corporate political contributions.
Utah business groups have also highlighted more subtle, but equally harmful, reputational consequences that include creating new barriers for recruiting top talent to Utah and dissuading entrepreneurs and event organizers from launching new efforts in Utah in an environment that undermines work to build diverse, equitable and inclusive environments.
Utah’s vital tourism and outdoor recreation industries could also take a hit as industry groups have already shown their willingness to lead out on boycott efforts to fight legislative policy they see as unfair or bigoted.
In the last few hours of the 2022 legislative session that concluded earlier this month, Utah GOP lawmakers ditched a compromise proposal that was aiming to create a commission to determine sports eligibility of individual transgender students, instead substituting an all-out ban and then advancing the proposal without public input. Following the 11th hour legislative coup, Utah Gov. Spencer Cox said he was “stunned” by the proceeding but noted that “some of the worst decisions get made at the last minute.”
Cox vetoed the bill earlier this week.
Equality Utah executive director Troy Williams, who was a key player in working with lawmakers to craft the original bill, said he was deeply saddened and disappointed by the last-minute pivot and noted the move flies in the face of past work he’s done with state legislators to advance important legislation on diversity and inclusion issues.
And he also predicted the override passage of HB11 would have immediate impacts on Utah businesses and their employees.
“I think that companies throughout our state and across the country have embraced their LGBTQ employees and acknowledged that diversity is a hallmark of capitalism,” Williams said. “Even before the override session, I’ve been hearing from Utah companies that are very alarmed by this bill and are looking for advice on how to navigate the consequences.”
Williams described the ban as a “mean and petty” piece of legislation that would only serve to create “moral panic and hysterics toward a threat that doesn’t exist” and undermine the goals of most Utah businesses and their employers to create, and be a part of, welcoming work environments.
“Fundamentally, HB11 is discriminatory legislation that unfairly targets minority children,” Williams said. “And it sends the message to LGBTQ employees, and the parents of LGBTQ children, that they might not be welcome in Utah. No reputable business wants to be associated with bigotry.”
Convention and tourism group Visit Salt Lake shared its concerns over HB11, noting that in addition to sizable and widespread financial losses, the legislation sends a pointedly negative message to future visitors and event organizers about what Utah stands for as a state.
“Visit Salt Lake has significant concerns about the potential for business loss due to actions taken by the Utah state legislature in the coming days,” the organization said in a statement. “For decades, Visit Salt Lake has been in the business of hosting a wide variety of conferences, shows and events. The economic impact of a bill like this could be up to and even over $50 million. More importantly, our events provide opportunities to support local hotels, restaurants, and retailers and introduce our amazing community to businesses and visitors from around the world.
“We can’t predict the specific revenue loss from the legislature’s pending action, but we anticipate it would be significant. More importantly, the legislature’s action would send a signal at an important time that we are not a welcoming community.”
Utah tech industry advocacy group Utah Tech Leads is railing against the transgender ban and, on Wednesday, launched a campaign around which Utah companies concerned about the fallout from HB11 can rally.
“We know diversity and inclusivity makes us and our companies stronger, and we support that diversity in whatever form it takes,” their statement reads. “We especially embrace our LGBTQ+ communities, workforce, customers, and their families. Supporting them means allowing them to be their authentic selves and is important to our company values.”
Utah Tech Leads also highlighted how serious the fiscal impacts have been for other states that have adopted similar legislation. Those include North Carolina, which lost billions following passage of a state law in 2017 that required transgender people to use restrooms corresponding to the sex on their birth certificates before the rule was quashed by the courts. Texas lost some $66 million just while debating a similar “bathroom ban” law, and cities in Tennessee and Kentucky have lost millions thanks to cancellations of events and planned investments following anti-LGBTQ legislation in those states.
A growing list of major U.S. corporations have rallied behind various efforts to push back on state-level legislation targeting transgender people and, last April, dozens of major corporate employers signed on to a letter opposing anti-LGBTQ state legislation, helmed by Freedom For All Americans and Human Rights Campaign.
The letter explains that “legislation promoting discrimination directly affects our businesses” by making it difficult to recruit and retain talent in states with discriminatory laws and by placing “substantial burdens on the families of our employees” in those states. A small sampling of the companies that signed on includes Amazon, American Airlines, AT&T, Dell, Google, Hilton, IKEA, Marriott, Microsoft, Nike, PepsiCo, T-Mobile, Uber, Verizon, Wells Fargo and more.
Utah-based Ancestry.com, the largest for-profit genealogy company in the world, shared its concerns about the impacts of HB11 and encouraged state leaders to continue working toward a solution that does not require banning children from participating in sports.
“At Ancestry, we stand firmly in our belief that our purpose, our people, and our products are strengthened by our unyielding pursuit of an inclusive and diverse workplace centered on equity,” Ancestry said in a statement. “We encourage the Legislature to continue working on this issue to find a solution that does not bar trans athletes from high school sports and promotes fairness for everyone. We have employees in Utah raising transgendered children, and we will always encourage public policy that fosters a welcoming and inclusive environment for all.”
Following the expected override vote on Friday, Utah may also earn a spot on California’s list of places that are banned as destinations for taxpayer-supported travel.
In 2016, California lawmakers banned nonessential travel to states with laws that discriminate against lesbian, gay, bisexual and transgender people. There are currently 18 states banned under the prohibition, according to a posting on the California Attorney General’s website.
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