The Committee on Government Affairs was called to order at 10:05 a.m., on Friday, March 12, 1999. Chairman Douglas Bache presided in Room 3143 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mr. Douglas Bache, Chairman

Mr. John Jay Lee, Vice Chairman

Ms. Merle Berman

Mrs. Vivian Freeman

Ms. Dawn Gibbons

Mr. David Humke

Mr. Harry Mortenson

Mr. Roy Neighbors

Ms. Bonnie Parnell

Ms. Gene Segerblom

Mr. Kelly Thomas

Ms. Sandra Tiffany

Ms. Kathy Von Tobel

Mr. Wendell Williams

GUEST LEGISLATORS PRESENT:

Sharron E. Angle, Assembly District 29

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

Ernest Rubi, Chief of Housing and Redevelopment, city of Henderson

Prior to reopening the hearing on A.B. 306, previously recessed on March 10, 1999, Chairman Bache announced his intention to refer the bill to a subcommittee.

Charles Rosenow, Economic Development Manager, Reno Redevelopment Agency, resumed his testimony, interrupted when the previous hearing on A.B. 306 was recessed. He provided an outline of his remarks (Exhibit C) and a booklet entitled "Downtown Neighborhoods Housing Action Plan" (Exhibit D).

Mr. Rosenow stated Reno Redevelopment Agency worked in conjunction with its 13-member advisory board, which met monthly. He explained Reno was divided into seven neighborhoods, and its city council established a neighborhood advisory program, which encompassed the entire city including the city’s redevelopment area. Each neighborhood advisory board was allocated $50,000 to use for whatever projects it deemed necessary for its neighborhood. Reno’s neighborhood advisory boards reported directly to the city council.

Mr. Rosenow referred to the definition of individuals who could serve on a redevelopment agency’s advisory board, contained in A.B. 306, and said pursuant to that definition, Reno Redevelopment Agency would have to ask many members of its advisory board to abdicate their positions. He contended the definition was very narrow and would preclude many advisory board members, employed by the university or as architects, engineers, planners, historical preservation experts, or members of the artistic community, from serving on redevelopment agencies’ advisory boards.

Mr. Rosenow stated over the past 10 years, Reno Redevelopment Agency acquired information about tent-housing projects, and some such projects had been constructed while others were under construction. The city of Reno designated $3.5 million " . . . in home funds . . . " for those projects, and Reno Redevelopment Agency designated $2.5 for those projects, one of which was a tax-credit project.

Mr. Rosenow said Reno Redevelopment Agency created a housing plan for Reno’s downtown area, and the plan was scheduled for review by the city council during the upcoming week. He explained Reno’s redevelopment area was relatively small and included only 2 neighborhoods with a total of 2,500 residents. Therefore, Reno Redevelopment Agency’s efforts were directed toward small, fringe areas of Reno’s downtown area.

Ernest Rubi, Chief of Housing and Redevelopment, city of Henderson, testified. He advised Henderson opposed A.B. 306, as written.

Mr. Rubi explained because Henderson was very concerned about affordable housing, the city combined housing and redevelopment functions in one department. He said currently, the city was "leveraging" and maximizing use of Community Development Block Grant (CDBG) and U. S. Department of Housing and Urban Development (HUD) funds for a first-time homebuyers program, rehabilitation programs, and similar things. Henderson believed with respect to some of its efforts, the city was not only in compliance with the law but had exceeded progress made by other entities.

Mr. Rubi contended Henderson’s redevelopment area was very different from many other redevelopment areas in Nevada. He explained Henderson’s redevelopment area consisted of an old, town site, containing 50-year old homes, which the city hoped to revitalize and redevelop into a more civic and business oriented area. Therefore, Henderson was somewhat concerned about the "one-size-fits-all" application of A.B. 306. Mr. Rubi pointed out in sections 3 and 9 of A.B. 306, the word "may" preceded the word "shall," which was used several times. He said he believed clarifying that the provisions contained in those sections were discretionary would establish a great level of comfort. He referred to the requirement for a written finding, established by section 2, and said Henderson would like such a written finding to constitute a presumptive conclusion that a resolution passed by either a city council or redevelopment agency’s board would not be frivolously challenged in court.

Mr. Rubi expressed a desire for representatives of the city of Henderson to be allowed to testify before the subcommittee on A.B. 306.

Assemblywoman Segerblom asked whether a new development for senior citizens in Henderson was sponsored by HUD or by the city. Mr. Rubi responded the city of Henderson developed some tax-credit housing for senior citizens and was maximizing use of the limited funds it received from CDBG for residential neighborhood improvements such as street lights, curbs, gutters, and sidewalks.

Chairman Bache commented he looked forward to Mr. Rubi submitting proposed amendments to A.B. 306 to the subcommittee.

Marta Golding Brown, representing the city of North Las Vegas testified. She declared the city of North Las Vegas opposed A.B. 306 as currently written and would like to be involved in amending the bill’s language.

Ms. Brown discussed the city of North Las Vegas’ redevelopment efforts and the proactive measures the city took prior to recent changes in law. She explained the city of North Las Vegas supported North Las Vegas Neighborhood Housing Services, whose assistance the city sought, in approximately 1991 or 1992, with regard to neighborhoods immediately surrounding the city’s downtown area. When the city’s redevelopment agency was created, few housing areas were included in its redevelopment area. Therefore, the city proactively sought an organization able to assist those housing areas.

Ms. Brown stated North Las Vegas Neighborhood Housing Service became incorporated in 1992, and North Las Vegas provided $650,000 to assist the organization and to assist in upgrading housing and down payments for housing. She explained North Las Vegas Neighborhood Housing Services was a community development organization established pursuant to federal law, which essentially stated " . . . that it is run by residents in the community, and it has to have a certain number of residents that come directly out of those targeted neighborhoods."

Ms. Brown said in addition to the $650,000 she previously mentioned, North Las Vegas’ city council provided North Las Vegas Neighborhood Housing Service with several hundred thousand dollars in grant funding and recently approved an additional $100,000 for use in down payment assistance projects during FY1999-2000.

Ms. Brown said in its economic development action plan, North Las Vegas’ redevelopment agency stated it was pursuing a public-private partnership for the Lake Mead Island project, currently the largest redevelopment project in the North Las Vegas area. The redevelopment agency would not use condemnation proceedings to facilitate that project unless it first ascertained a property owner preferred to have his property taken by that means.

Ms. Brown stated North Las Vegas made relocation payments to tenants and homeowners, in connection with redevelopment projects, prior to " . . . the state law becoming effective." In 1994, to facilitate the project of widening Lake Mead, 13 homeowners and 3 tenants, all of whom entered into voluntary, relocation agreements, were relocated. Each homeowner received $3,000 and each tenant $2,000 in relocation payments.

Assemblyman Lee referred to work in progress on Interstate 15, and asked how people who lived in homes purchased to facilitate extension of the interstate highway were moved from those homes. Ms. Brown replied the project to which Mr. Lee referred was, primarily, a state project. However, the city of North Las Vegas contributed some funds to the project for things the city wanted done at a particular site. She said she did not know the answer to Mr. Lee’s question but could ascertain the answer.

Mr. Lee asked how the state handled the problem of relocating the people to whom he referred. Ms. Brown reiterated she could ascertain the answer to Mr. Lee’s question.

Chairman Bache suggested the director of NDOT could answer Mr. Lee’s question.

Chairman Bache referred to the area between Las Vegas Boulevard and Interstate 15 and asked whether businesses currently located in that area would remain or, instead, the city planned to turn the area into a beautification project. Ms. Brown replied the area would not be used for a beautification project, rather, it would be a business-enhancement redevelopment area. She said a parking structure and an office building complex were planned for the area.

Neena Laxalt, representing the city of Sparks, testified utilizing prepared text (Exhibit E). She said Sparks Redevelopment Agency had been judicious in applying redevelopment law to efforts to revitalize the city’s downtown area. In the agency’s estimation, existing law had worked well for Sparks since 1978, when the city’s redevelopment plan was first adopted. The city constructed many public improvements to enhance the core of its downtown area under existing law.

Ms. Laxalt said Sparks had not utilized the power of eminent domain until recently, when it utilized eminent domain to acquire property for its Victorian Square project. It did so only after careful consideration, after many public meetings and hearings were held, and after a specific plan for the project was adopted. Sparks offered fair market value for the properties it obtained through eminent domain and offered generous owner and tenant relocation benefits. The city acquired 35 parcels of property, and 143 property owners and tenants had to be relocated. Three of the city’s property acquisitions and three instances of relocation " . . . required a legal solution." All tenants and owners were granted 3 months free occupancy, and the city paid their moving expenses. Owners of the owner/occupant residences acquired were able to move into homes of higher value, located in better neighborhoods, than those they previously owned. Seven tenants were able to use their relocation and moving benefits to become homeowners.

Ms. Laxalt said several business owners wanted to participate in the Victorian Square project, and the city entered into a redevelopment and disposition agreement with several commercial property owners and a master developer to finish the project.

Ms. Laxalt reiterated existing community redevelopment statutes worked well for Sparks. She said since 1987, more than $121 million was invested in Sparks’ downtown area by the private business sector, and another $40 million would be invested over the next 5 years. Sparks’ redevelopment agency invested $63 million and would invest an additional $4 million over the next 5 years.

Ms. Laxalt asserted Sparks prided itself on involving citizens, business owners, and experts in the planning, decision making, and implementation process of redevelopment. Through conservative and equitable practices, the city minimized disruption and inconvenience for citizens and business owners displaced by its Victorian Square project.

Ms. Laxalt maintained the Victorian Square project caused families to return to Sparks’ downtown area, once noted for transients, crime, and blight. The city’s redevelopment efforts created an atmosphere attractive to private investors, and 100 percent of the buildings in Victorian Square were leased. The Victorian Square project was a catalyst for creation of 1,300 new jobs in an 8-block area, and the potential existed for creation of 720 additional new jobs over the next 5 years.

Ms. Laxalt stated the city of Sparks believed there was no reason to amend current redevelopment statutes and create requirements which were onerous and detrimental to existing redevelopment areas.

Chairman Bache stated he would appreciate it if any amendments to A.B. 306 proposed by the city of Sparks were presented to the subcommittee on the bill.

Mary C. Walker, representing Carson City, Douglas County, and Lyon County, testified. She said she was previously Carson City’s finance director for 12 years and its redevelopment director for 5 years. She stated three advisory boards were established in Carson City, and Douglas County recently implemented a redevelopment plan and established one citizens advisory committee.

Ms. Walker asserted several aspects of A.B. 306 were not pertinent to Nevada’s smaller rural communities. She cited Carson City as an example and pointed out the city’s redevelopment area consisted of its downtown, commercial district, a commercial district located on Highway 50, and the city’s historic district, 40 to 50 percent of which was commercial. Therefore, there were essentially no residential neighborhoods in Carson City’s redevelopment area. Ms. Walker maintained the low-income housing provisions of A.B. 306 were not applicable to smaller rural communities because most of those communities’ redevelopment areas were comprised of commercial areas.

Ms. Walker stated eminent domain was " . . . not a bad word . . . " in Carson City. She explained the city did not want to engage in first condemning properties and then rehabilitating them. An incentive program was established, through which the city’s redevelopment authority would pay up to 20 percent of the cost of rehabilitating a building, with the result the St. Charles Hotel and several other buildings were renovated.

Ms. Walker said during the 5 years she was Carson City’s redevelopment director, she conducted several surveys. One of those surveys was printed in the Carson Appeal and asked citizens to express their viewpoints on redevelopment as it related to infrastructure improvements. In response to that survey, she received many inquiries about what the redevelopment authority planned to do about two old, closed casinos. The redevelopment authority was able to work with the property owner of one of those casinos, and the building was currently being renovated.

Ms. Walker reiterated eminent domain was not a bad word in Carson City. Citizens had requested its use; however, the city attempted to resolve matters with property owners before making use of eminent domain.

Chairman Bache closed the hearing on A.B. 306 and appointed a subcommittee comprised of himself, as chairman, Assemblymen Williams and Lee, and Assemblywomen Berman and Gibbons.

Assemblywoman Sharron E. Angle, District 29, submitted a proposed amendment to A.B. 66 (Exhibit F).

Chairman Bache apologized because the committee, due to time constraints, was unable to immediately consider the proposed amendment. However, he said, the committee would consider the amendment during a future work session.

There being no further business to come before the committee, Chairman Bache adjourned the meeting at 10:30 a.m.

RESPECTFULLY SUBMITTED:

Sara Kaufman,

Committee Secretary

APPROVED BY:

Assemblyman Douglas Bache, Chairman

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