Exclusive: By the end of April, the new home of the Sundance Film Festival should be public knowledge with the Salt Lake City/Park City combo, Boulder, Colorado or Cincinnati bid picked as the host for the next decade. However, a bill heading toward Utah Gov. Spencer Cox’s desk that would ban the Pride flag in schools and other state government buildings might be an eleventh-hour obstacle to the Beehive State’s hopes of keeping the Robert Redford-founded shindig past 2026.

“What are they thinking?” a Sundance insider said late Tuesday of the bill to ban the LGBTQ+ flag after a virtual meeting between united Utah leaders and members of the festival’s selection committee. “Utah is Utah, but this goes to the heart of the community Sundance has worked years and years to develop.”

“It is a terrible law, a terrible look for the state,” the insider added of...