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University of Utah's Red Zone stores under fire by legislative auditors

SALT LAKE CITY (ABC 4 Utah) - Legislative auditors have taken aim at the University of Utah’s Red Zone stores. A new audit claims the university is violating policies and unfairly competing with private businesses.
SALT LAKE CITY (ABC 4 Utah) - Legislative auditors have taken aim at the University of Utah’s Red Zone stores. A new audit claims the university is violating policies and unfairly competing with private businesses.

Now a member of the Pac-12 the Utes have a growing number of fans. The University of Utah says that demand is one reason why they opened the red zone stores.

Director of Communication Keith Sterling told ABC 4 Utah, “When we first looked at this issue it was in response to demand from alumni, faculty, staff and students particularly alumni who felt coming to the campus for merchandise was inconvenient."

A new audit by the legislative auditor accuses the University of Utah of violating the Board of Regents' policy of competing with private businesses. Representative Johnny Anderson brought the possible violation to the auditors’ attention.

Rep. Anderson said, "These are stores that are owned by the University of Utah, they're essentially satellite locations for the University of Utah bookstore selling officially licensed products that are also sold in other private retailers."

While their prices may be consistent with that of the private sector, and the Red Zone stores are collecting the appropriate sales taxes, Rep. Anderson says they're still competing and that means their in violation of their policy.

"The University of Utah has a humongous budget, much of which is subsidized by taxpayers, so they're maybe not undercutting even at that level it's pretty unfair competition."

The university says the creation of the Red Zone stores were approved by the Board of Trustees and it's something that many Pac-12 universities have.

Sterling told ABC 4 Utah, "Several of the schools in the Pac-12 have many locations, actually more than we do, that sell their merchandise. It's not an uncommon approach."

Sterling admits while the Board of Trustees approved of the Red Zone stores, the Board of Regents did not. He says the university is going to sit down with the Regents and the Legislature to see what it would take to address everyone’s concerns.
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