The Committee on Government Affairs was called to order at 8:29 a.m., on Tuesday, April 6, 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

Ms. Sandra Tiffany

Ms. Kathy Von Tobel

Mr. Wendell Williams

COMMITTEE MEMBERS EXCUSED:

Mr. Kelly Thomas

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

Jerry Govan, representing himself, testified in support of the bill. He submitted an outline of the proposed changes to the bill (Exhibit C). In 1993 mobile home parks began being treated as if they were housing tracts with water fees becoming a large outlay and in some cases over $5,000. He had been in the mobile home park business for over 30 years and built over 10,000 park spaces as well as 1,500 condominiums and townhouses in the State of Nevada. He was also a member of Associated General Contractors (AGC) and Southern Nevada Home Builders Association.

He was the development manager of an affordable senior’s park built in 1993 where 466 spaces were pre-rented to seniors who qualified. Under the present fee structure, that park would not have been built. It would cost almost $2.4 million more just in water fees for a park that cost $6 million and totaled a 41 percent increase. He added that would also increase the rents of the tenants, and it had been built without government assistance but still met all the standards of the Community Reinvestment Act.

Currently there were apartments having 300 units of water for under $100,000 while some mobile home parks with 300 units would pay approximately $1,587 per unit. He did not feel increases were the intent of the bill passed 2 years ago and realized there had to be some compromises as there was more than one water district in Clark County, so different individuals had to interface in making changes. He added he thought there needed to be equitable fees, as it seemed apartments were getting preferential treatment, and the current bill would basically stop future building of mobile home parks in Clark County.

Mr. Govan said another example was a 40-acre parcel would cost $60,000 an acre, which equaled $2.4 million. Water fees would run approximately $1.250 million making it very difficult for construction of affordable housing in Clark County. There was a Senate bill that recommended meters be installed at a moderate cost to the homeowner. If that occurred the issue of who read the meter had not been addressed and it would involve additional costs.

Ms. Parnell questioned what effect an individual meter would have on the mobile home owner. Mr. Govan responded the water cost to mobile home parks was out of proportion. The fact was a mobile home in a park used very little water. Most had desert landscaping and generally had bills of between $8 to $12 per month and there were problems when a $5,000 fee appeared on a long-term projection for a developer. Many condominiums, apartments, and mobile home parks had been master metered and the cost was minimal when the water bills were averaged out. He felt the issue lost perspective when rent control legislation was passed, and at the same time water went up over 50 percent and trash pickup over 100 percent. In analyzing the facts he found there had been no marked increase in rents in the low to moderate parks in the Las Vegas area, there were some increases in the higher priced neighborhoods.

Ms. Parnell asked if the issue was actually an individual rate versus a rate averaged throughout the park. Mr. Govan replied the cost of installing individual meters did not really warrant the expense. There had been no installation in apartment complexes and he felt there was no difference between that and a rental park. He pointed out park development had dropped off considerably due to the requirement of installing meters by the contractors.

Ms. Gibbons asked why the language regarding mobile home parks constructed after October 1, 1995, was being deleted. Mr. Govan responded he was not sure but thought it might be due to rent control issues and complaints about water fees. He felt when the legislation was passed both the Assembly and Senate members believed there was going to be a moderate cost of $135 to $150 for installation for individual metering. However, the subject of who would read the meter and how it was read had not been addressed. He stressed the main issue was equity between all rental properties.

Ms. Von Tobel related she had several manufactured home communities in her district, and the issue was of vital concern. She believed park residents wanted separate meters, mainly because without them the residents were charged an equal amount whether there was one person or several living in a home. As an example, she had a house with all desert landscape, a considerably larger area than a lot in a park, and her bill ran about $12 per month. If the parks were charging any more than that per month, she felt the residents were being exploited. She also wanted substantiation for the statement manufactured home community development had dropped off due to installing meters.

Mr. Govan declared a $5,200 fee per lot equated to a substantial capital outlay. He felt $1.25 million for a 300-space park was an exceptional increase when the prior cost was $59,000 for a 2-inch meter, plus a front footage allowance. That equated to under $100,000 as opposed to $1.25 million, and that made a large difference in construction costs. In turn the increase would have to be passed on to the park residents. Ms. Von Tobel believed the water district could probably better address the issue.

Mrs. Freeman asked if the bill would apply statewide. Mr. Govan explained it affected only those areas with a population of more than 400,000.

Mrs. Freeman queried if the Southern Nevada Water Authority determined the fees to be charged. Mr. Govan replied it was the Las Vegas Valley Water District.

Mrs. Freeman inquired how the cost was justified. Mr. Govan said he felt it was not justified as the mobile home was being treated as a single dwelling rather than a rental unit. He added there were manufactured homes on private lots or in subdivision settings, and then there were rental parks that were entry- level affordable housing where any additional expense would be a deterrent.

Chris Weiss, Southern Nevada Water Authority, Las Vegas Valley Water District, indicated he would do his best to address questions from the committee, it was not his area of expertise. For the record, the district opposed the bill due to the manner water was provided to manufactured home communities. One primary issue was residents were not aware of their individual water use and therefore were not taking steps to conserve water. Conservation was a major reason for individual metering in mobile home communities. Another issue was one of individual control. When the homeowner was on a master meter they were unable to conserve water because they did not know their actual consumption. There were also many instances where a person conserving water was paying the same rate as one that was not, because it was averaged out between all the tenants.

He added prior to 1995 installation of individual water meters at manufactured home communities in Las Vegas was prohibited. Communities installed master meters that monitored water consumption for all homes in common areas within the community. The total water consumption in the community was calculated and then divided equally among residents regardless of individual water usage, resulting in residents having no idea what their actual water consumption was.

In 1995 A.B. 287 of the 68^th Session passed, allowing existing manufactured home communities the ability to install individual meters but mandating it for all parks built after October 1, 1995. One benefit to individually metering communities was sound water management that the American Waterworks Association and the Environmental Protection Agency both considered one of the most basic measures that could be taken toward responsible management of the resource. Individual metering allowed water agencies to accurately quantify total consumption, characterize consumption components, and customers paid for exact usage. The link between costs of the resource created awareness in the user that was the cornerstone of any conservation program. There were also initiatives for conservation such as direct install low-flow showerheads and other water saving devices to mobile homes.

With the passage of the bill in 1995 a master meter assistance program was initiated and water-tracking devices were installed in four mobile home parks. That was done to quantify savings, as a prelude to creating potential incentives that would help existing parks in moving to individual meters. There was also a bill dealing with submetering of apartments to see if an agreement could be reached on that issue, as it was felt residents should not pay more than the actual cost of the water they were using.

He stressed repealing the current legislation would be a step back in conservation efforts in southern Nevada, and there were a number of ongoing programs to maximize existing water resources and promote conservation in the Las Vegas Valley.

Chairman Bache remarked the meters were not as big a problem as the way the hookup fees for mobile homes were charged. Mr. Weiss testified based on the concerns of the proponents of the bill he felt cost was the main issue. It was more expensive than installing master meters in the whole park. In those cases one or two large meters were typically installed and with individually metering smaller meters were installed at each site on the property. It was the only fair way to accurately measure water otherwise it was an averaging issue. In addition, mobile home parks with master metering tended to hit the higher thresholds much faster due to the inverted tiered water rate structure. Therefore, mobile home parks were actually paying more for water across the board.

Mr. Lee stated when working on a construction project on an existing building to put in an additional toilet and sink the only charge was for the fixture cost. There was a sewer drain hole where all the water flowed down, and he questioned if it was possible to install a master-meter loop system so they would only be charged for each opening because the mobile was a rental. Mr. Weiss stated it was an interesting concept, but he was not involved in construction projects. The concept could certainly be pursued.

Mr. Lee thought the process should be pursued, as it was currently very expensive for the mobile home owner.

Ms. Von Tobel thought something should be outlined indicating what a contractor paid per lot versus what a mobile park paid per lot. Most of the parks in her district had approximately 300 spaces and the overall rent they received was considerably high. Even though the space was rented the home was actually owned by the resident and when figuring in the contractors initial cost, a million dollars might sound like a lot. However, when it was broken down into how many units could be placed on an acre, the cost was probably not nearly as high as it sounded. She added she would appreciate some exact figures on costs between stick built and mobile pad communities.

Chairman Bache asked Mr. Weiss the differential between the cost for a mobile home park under the old system for master metering and a brand new park that was built for individual hookup. He felt the problem was not with the meters or the cost of the water but for the hookup in new construction.

Mr. Weiss replied he had some numbers but they had recently changed. A mobile home connecting in October of 1991 involving two 6 by 2 inch meters cost about $19,000 and one connecting in November of 1992, having a 6-by-3 inch meter cost $16,500. In October of 1997 a park involving 192 individual meters cost about $790,600. So the cost of individual metering was definitely larger but allowed each unit to have access and control of their own water.

Chairman Bache questioned if that was due to the higher individual connection fees. Mr. Weiss answered in the affirmative, as individual lines were being run and connected to meters at each point of use.

Joe Guild, representing the Mobile Home Community Owners Association, pointed out his association was the largest in Nevada representing people who owned mobile home parks. If the bill changed what was now in place he believed there would be strong opposition from the mobile home association. Individual meters used to be prohibited in mobile home parks in Nevada, and many members of the organization he represented wanted the ability to install individual meters for various reasons. He felt fairness was the main issue as a single person could be paying the same amount as a family of five in a master metered situation. An agreement had been reached in 1989 between the Las Vegas Valley Water District, a representative for the Tenants Association, and the Mobile Home Community Owners Association. The former chairman of Government Affairs Committee attempted to broker an agreement allowing individual meters to be installed in mobile home parks. The Las Vegas Valley Water District wanted it done for conservation reasons, but the tenants organization thought it would hurt them rather than help them and the deal fell apart.

Mr. Guild indicated the program to which Mr. Weiss referred had been very successful, and his organization wanted to see it continued. Costs for new park installation of water meters mentioned by the proponent of the bill were not costs associated with retrofitting a master metered park. He felt that leaving out the mandatory language beginning on line 13 of the bill and continuing through to the end of the bill would upset the retrofitting program because the park would still have the ability to switch to individual meters. If 200 meters were installed at a total cost of $790,000 it was considerably less per lot than the $5,200 as stated by the proponent of the bill.

Ms. Von Tobel believed when retrofitting was allowed would it then require meters in new parks and questioned at what point they would start retrofitting meters. She believed it sounded as if it was more expensive to retrofit than to install the meters when the park was initially built and felt the policy of installing meters during construction made sense.

Mr. Lee stated Mr. Guild’s testimony seemed to indicate protectionism. If a park was in place, and they bought the adjacent 10 acres, they could hookup to the existing system without paying the hookup fees. But if another person wanted to build an individual 10 acre park they had to go through the whole process and each person had their flow-down meter costing $150-$200, charging $5,000 per lot seemed extremely high.

Mr. Guild pointed out the people he represented wanted the option of inexpensively changing from a master meter to an individual meter. They would then have more control over the amount of water going into their parks, more fairness was associated with the charges assessed to each individual tenant, and leaks could be identified. The most important issue was conservation especially in Clark County. He was not talking about protecting anything, only preserving an option because many parks wanted to convert at their own expense. The program Mr. Weiss addressed and was supporting for conservation reasons had been proposed to several mobile home parks in Clark County. It would be in partnership with the Las Vegas Valley Water District and they would retrofit the individual meters for approximately $110.

Mr. Lee indicated he was concerned about preserving options. The option was given to the older established communities, but it was mandating individual metering in new parks which he felt was not fair. Mr. Guild explained the organization he represented would welcome 100 new mobile home parks and welcomed competition in the marketplace. If it meant that somehow the Las Vegas Valley Water District and new developers had to figure out a different way of assessing hookup fees, he agreed, as $5,200 seemed excessive.

Mr. Weiss interjected in terms of the retrofitting program under way he did not have exact numbers. In terms of the retrofit kits and other initiatives dealing with mobile homes phase I yielded about 80 million gallons per year, and phase II was estimated at 40 million gallons per year which was a significant saving.

Ms. Von Tobel thought if A.B. 65 passed it would be a step backward because new developments would not be required to install individual meters. Conservation was a key issue, and it appeared individual tenants wanted a water meter so she would suggest the proponents of the bill should approach the Las Vegas Valley Water District to see if a compromise on costs could be reached. It was the price of doing business in developing manufactured home communities and no different than a housing development. Both had to hookup to power, gas, sewer, and water.

Mr. Lee agreed with installing meters, but questioned why the whole project had to have a master meter, and then each unit acquired their own meter. There was another formula used in house construction that was not being used and thought it should be examined to see if it was feasible in manufactured housing communities.

Chairman Bache interjected one reason the bill was not heard earlier was because the water district and a couple of individuals who planned to build mobile home parks in the valley were trying to reach a satisfactory compromise. As he was not aware any progress had been made, he decided to schedule the bill for hearing but no action would be taken until a later date.

Chairman Bache turned the gavel over to Vice Chairman Lee so he could provide testimony on A.B. 222.

Doug Bache, Clark County, Assembly District 11, testified the bill came about because of his continued desire to consolidate police jurisdictions throughout the state. He indicated for members who were on the committee in the 1997 session, a bill came from the Senate side in the waning days dealing with the airport authority. It removed them from the jurisdiction of the city of Reno and made them an independent police force.

He had a problem with the bill because there was no oversight by any elected official. The airport authority was made up of people appointed by the various entities in Washoe County, they had limited jurisdiction within airport property, and were responsible to the Reno City Council. Part of why he processed the bill was because those people would have lost their peace officer status and he did not want to see the airport police in Reno losing their jobs. He felt an appropriate place for the airport police was under another governmental entity. Although he had not had any discussions with the Washoe County Sheriff’s office on whether they were in favor of the bill, he felt it would be logical for the airport police to be placed under their jurisdiction. In his opinion significant savings would be realized as well as many other problems by consolidating jurisdictions.

Mr. Lee questioned if the Metropolitan Police Department had those responsibilities at the airport in Las Vegas. Chairman Bache replied a number of years ago there was the city of Las Vegas police Department and the county sheriff’s office and those two were consolidated under chapter 280 of Nevada Revised Statutes (NRS) and became the Metropolitan Police Department.

Vice Chairman Lee asked if either of those agencies policed the airport. Chairman Bache responded he was not sure who had the responsibility before consolidation because there were no longer separate jurisdictions.

Mr. Lee wondered if they currently reported to the administrator of the airport. Chairman Bache stated there was a chief of police in the airport authority and he believed the chief reported to either the board or director of the airport authority.

Mrs. Freeman wondered since members of the airport authority were appointed would he support electing the officers of the airport authority. Chairman Bache responded he had no problem, if the Washoe County Board of Commissioners or the city councils of Reno and Sparks became members by appointing themselves to the board or were elected independently. Because then elected officials would be in charge.

Mrs. Freeman pointed out one of the problems with regard to the airport in the past few years was the issue of eminent domain. Many residents felt the airport authority had no responsibility to the people living in that area because they were appointed rather than elected. She thought perhaps it was time to take an in depth look at the issue.

Ms. Segerblom asked if the airport was located in the county or the city. Chairman Bache replied it was in the city of Reno

Mr. Williams stated the McCarran airport in Las Vegas was under the jurisdiction of the Metropolitan Police Department (Metro). However, lately, he had seen some private security people as well. He indicated it would be privatization in a sense if either Metro or the airport hired a private company.

Chairman Bache thought Mr. Williams should check with Lt. Olsen of Metro.

Mr. Williams inquired if a particular police department took over the jurisdiction and private companies started to surface, was there anything in the law that dictated how privatizing some of those services would be accomplished. He wondered if contracts allowed the governing agencies to be solely responsible for policing the areas so the public could be assured no services were privatized they did not want.

John Sande, attorney, Jones-Vargas Law Firm, representing the Airport Authority of Washoe County, spoke in opposition to the bill. The airport authority was created in 1977 by a special act in chapter 474 of the Nevada Revised Statutes. It had been created because of a perception that the city of Reno was not operating the airport in a manner approved by the citizens or legislature. At the time of creation the authority consisted of appointed officials from the city of Sparks, the city of Reno, and Washoe County.

In 1977, the airport authority was authorized under the statute to create its own police force and has had its own police force since that time. The reason a bill had been introduced in 1997 was the fact that under federal aviation rules, an airport officer must have peace officer status. Namely, the power to arrest without a warrant based upon probable cause, and the authority to carry a sidearm. Due to opposition in the 1990’s because of the proliferation of peace officers in state, instead of recognizing there had to be compliance with FAA requirements, the city of Reno deputized the police at the airport under an inter-local agreement.

Mr. Sande added police at the airport had all the same training as all other law enforcement agencies, and it was just a matter of deputizing them. Police Chief Kirkland had thought it was too costly and inconvenient to follow an inter-local government agreement.

He believed the airport authority had an outstanding police force, had their own union, were highly trained, and equipped to specifically operate in an airport atmosphere. They believed the change would greatly increase their costs if another inter-local agreement had to be entered with the sheriff’s department. He thought the policy created in 1977 should remain in place.

Mr. Humke asked who appointed the Washoe County Airport Authority board members. Mr. Sande replied the members were appointed by the city of Reno, the city of Sparks, and Washoe County, and he pointed out it was a very time- consuming position due to recent experienced growth.

Mr. Humke questioned if it would be a correct statement that all of those board members reported to a board of elected officials. Mr. Sande answered not only was that the case, at least one member was removed due to a disagreement with the city of Sparks over a certain action that was taken. It was a very politically charged board and obviously got a lot of attention by the respective bodies.

Mr. Humke indicated there had been news accounts of turmoil with the director of the airport authority in recent years and subsequently the staff director had been replaced. He wondered if during those years of controversy there had been any involving the airport authority police force. Mr. Sande stated not to his knowledge.

Chairman Bache inquired what the outcome would have been if the bill introduced in 1997 had not been processed. Mr. Sande thought another inter-local agreement would have been entered into and the city would have had them deputized so under the law they had the power to arrest and carry a sidearm, to be in compliance with FAA regulations. There was a strong possibility if the legislature did not grant peace officer status to those officers, the police force would have to be disbanded.

Mr. Bache said the reason the bill was processed in 1997 was due to the fact all the officers would have lost their jobs and there were no alternatives given at that time. He saw the present legislation as an alternative because he did not like to see expanding jurisdictions and having those little police forces here and there. He had heard some complaints from citizens from Reno about airport police officers pulling people over on Plumb Lane. Mr. Sande only knew of one incident where someone was pulled over on Plumb Lane and it was because they had been speeding through the airport. If the present bill passed the sheriff would have to provide personnel based upon what he determined to be in his best interest.

Chairman Bache felt the way the bill was written the current members of the police force of the airport authority would be transferred into the sheriff’s department as a separate division. He stressed that was not his intent with regard to the current airport authority police.

Andy Anderson, president, Las Vegas Police Protective Association Metro, Inc., testified the security people at the concourse and x-ray machines were employed by a private company contracted by the county. The Metropolitan Police Department did have police service at the airport, but they did not contract with the people working the concourse. He added prior to consolidation, the Clark County Sheriff’s Department had several officers at the airport.

As there was no further testimony Chairman Bache closed the hearing on A.B. 222.

Assemblyman David Humke, Washoe County, District 26, referred to the 1991 reapportionment and pointed out the Reno-Tahoe Airport was no longer a part of his district. He was asked to sponsor A.B. 575 by Mr. Ross de Lipkau, the counsel for the Airport Authority of Washoe County, and he would present testimony on the bill.

Ross de Lipkau, attorney with Marshall, Hill, Cassas & de Lipkau, explained the bill was basically a 1993 bill affecting NRS 534.350. The history was a mandamus action being brought against the Nevada State Engineer and required him to make regulations. The legal proceedings did not progress, but the state engineer did draft regulations, and hearings had been held in the fall of 1998, but the final regulations had not been promulgated. The main parties involved in the hearings were Sierra Pacific Power Co., and Washoe County Regional Water Planning.

He believed everyone knew 98 percent of citizens in Nevada lived within a basin as designated by the state engineer. As designated the basin meant that the ground water had been fully appropriated which also meant the state engineer would not grant any further water rights. Therefore, in order for communities to expand there must be a conversion or use of existing rights. Sierra Pacific Power Co. had been acquiring water rights since approximately 1964 and as indicated in his outline (Exhibit D) the bill was not intended to create a water right nor to acquire water where water was not available.

The wells the airport authority was seeking to convert were exempt pursuant to the water laws in NRS 534.180. The bill with the amendments would allow the state engineer to make regulations for each particular basin, because one set of regulations did not fit all of the approximately 258 ground water basins in the State of Nevada. The State Department of Transportation was in the process of acquiring or condemning property for the bypass freeway around Carson City. Many of those homes were served by individual domestic wells so the source and benefit would accrue to the department of transportation.

Mr. De Lipkau added in the event that the State of Nevada built a new office building upon agreement with Carson City, the city could then give the state the right to use their water. It would not be creating a new water right nor would any additional water be pumped from the ground water basin. Over the years the airport authority acquired or condemned approximately 190 homes, all with individual domestic wells. If the bill was not approved, the airport authority could find itself in the position of giving away 190 units worth of water rights and then would have to buy it back on the open market. The airport authority would like to utilize water based on realistic figures, and the state engineer’s regulation power would be the place where the amount of water pumped from the 190 unites would be given to the state engineer. Regulations would then be promulgated to assure there was no excess pumping and it was a modern trend of using older water rights for newer uses. There would be no additional cost to the public or a greater demand on ground water basin withdrawal. In a particular basin, if the community well field was being pumped to its maximum, water credits would not have to be accepted by a particular water company. There were several safety factors in place so there could not be a forcible delivery of water, nor would it create an additional demand. He urged the committee to pass the bill as written.

Marlene Schultz, interim manager of the Business Development and Property Administration Department of the Airport Authority, explained when the airport property was actually transferred to the airport authority, all water rights were stripped from the property. During the interim years properties adjacent to the airport were purchased because of incompatibility with the airport. Those homes were purchased with appurtenant water and well rights. Ninety-five percent of those purchases came from federal funds. The Federal Government currently required the airport to return those properties to the benefit of public use, and to do that water rights needed to be dedicated to the public system for industrial and aviation related purposes.

If the bill did not pass, it would force the airport authority to try and purchase additional water rights on the public market. That would place the airport in a unconscionable position with our constituency, as they represented the cities of Reno and Sparks, and also Washoe County. The airport created several billion dollars worth of economic benefit to the Washoe County area and they did not want to see the airport artificially limited in its ability to grow. She believed the fact that the airport would not be allowed to use those water rights, the property originally acquired would be virtually worthless and unusable.

Ms. Gibbons thought the airport had purchased a bank of water rights. Ms. Schultz responded in the 20 years that the airport authority had expanded, water rights were acquired with the purchased properties. As those lands were being put back into use, the water rights would be dedicated to the water purveyor, which was Sierra Pacific Power Co., but there was no bank of water rights.

Ms. Gibbons said she was curious because during the last administration they had stated they would be acquiring water rights for the future. Ms. Schultz did not believe that was the case. There were 1,400 acres of property in the city of Reno and another 5,000 acres in Stead so the airport water rights amounted to about 270-acre feet of water. She added that was hardly enough to irrigate any domestic property, let alone industrial usage.

Ms. Gibbons inquired about the golf course that was being planned at the airport. Ms. Schultz replied a golf course was planned to the south and was a compatible development with the former subdivision called Home Gardens. Over 110 one-acre lot homes were purchased, all with well rights. If there was no available water, the developer would have to purchase water elsewhere which in turn would increase the fees charged residents for the use of the golf course.

Ms. Gibbons indicated 10 to 15 years ago eminent domain was used to seize property in Home Gardens, and it was actually worse than the Rowana Farms situation. She remembered the airport was desperate to acquire that property and nothing had been done with the land, therefore, she had some real concerns with the bill.

Janet Carson, director of Water Policy for Sierra Pacific Power Co., stated they were in support of the bill and felt it was a positive step forward. Sierra Pacific was the major water purveyor in the Reno-Sparks area, operating 25 commercial wells comprising about 20 percent of the water supply with the majority coming from the Truckee River. If A.B. 575 passed it would save customers money, preserve the finite supply of water rights in northern Nevada, and keep the area aquifer whole. As described by the airport authority all customers applying for new water service or expanded water service must dedicate water rights. It was an expensive proposition and one affecting not only the airport authority but it could also impact NDOT, the redevelopment agency, or the Washoe School District.

The water rights in the Truckee River basin were finite as no more rights were being created to the extent that if parties like the airport authority were unable to benefit from the bill, the authority would have to purchase water rights. In a regional sense it depleted the water supply from the region by taking up water rights unnecessarily and used it up in a way that allowed those domestic credits to be used for commercial purposes. The aquifer in the Truckee Meadows was pumped by various entities but the water did not know where it was being pumped, and the idea that some of those credits should only be used for a house seemed silly. She felt instead of using credits for a house at the same location there should be an allowance for it to be used for other purposes.

Mike Buschelman, chairman of the Washoe County Regional Water Planning Commission, spoke in favor of A.B. 575. The commission was legislatively created in 1995 due to a need to have advisors looking at the waste water and flood needs of the Washoe County region. The commission was an advisory body to the board of county commissioners and in that capacity they looked at a number of issues and then made recommendations to the board. When it came to domestic well credits an order was being examined by the state engineer’s office to create a district within Washoe Valley. When conversions were done the credits could be used as a substitute for a hookup if the water purveyor agreed. From the standpoint of the water planning commission they unanimously supported the concept of converting domestic wells to a credit that could be supplied by a utility. That recommendation had been forwarded to the board of county commissioners who supported the recommendation, as they felt the conversion of the domestic credit was a good policy.

Part of the reason they felt the bill was needed was that future water supplies were constantly being scrutinized as water rights were a big issue within the Truckee Meadows and Washoe County. If domestic well credits were not accepted it would force any domestic wellowner to go out and buy a water right in order to hookup to a utility. The credit allowed a hookup and utilization of existing water demands in the form of a credit to the utility and they believed it was a better solution than creating an increased demand on existing water rights.

Mike Turnipseed, Nevada state engineer, testified they were in opposition to the bill. In Lemon Valley, the basin was over-appropriated and many domestic wellowners had deepened their wells three or four times. Additionally, the prior state engineer called for beneficial use on all of the permits in Lemon Valley. Therefore, there were empty lots within the Black Springs service area and the Horizon Hills subdivision that could have drilled a domestic well. There were also residents on domestic wells that wanted to hookup to the municipal system supplied by Washoe County. He felt the procedure worked very well and in his opinion an amendment was not needed.

Mr. Turnipseed said his office was asked to provide the same kind of rules in the Truckee Meadows. After hearings, final rules were drafted but not yet released; however, A.B. 575 was totally different than what was intended in the original bill. He pointed out there was a response to comments made at those hearings (Exhibit E) and it gave a little history of why the legislation was needed, because of the declining water table in Lemon Valley. The Truckee Meadows was different than Lemon Valley as there was no wholesale decline in the water table, and there were water rights available for purchase. Domestic use was the only exemption from the ground water law and had been effect since 1939. Mr. de Lipkau had stated it was not an attempt of the bill to create a new water right, but by the very virtue of changing it to another use that was exactly what had happened. If it was changed to a commercial use such as a golf course, a water right was created where one never existed

As indicated in prior testimony the airport authority condemned homes in Rowana Farms and Home Gardens for future expansion. The testimony presented indicated the people were compensated for their property and ground water rights were selling between $7,000 and $8,000 per acre-foot. Under the domestic well exemption up to 1,800 gallons could be pumped per day and equated to approximately 2-acre feet, he doubted the homeowner was paid an extra $16,000 for their right to have a domestic well. There were no figures available substantiating how much water was pumped from those homes, if any. Truckee River rights were purchased and transferred and the subject of a prior transfer application had been protested and was currently the subject of ongoing litigation.

He added there was no way to tell if the homes used 150 gallons per day or 1,800 gallons per day. If they were given credit what amount could be placed on it, because there was no way to track usage. When state lands bought a piece of sensitive property in the Lake Tahoe basin they were not compensated in addition to the appraised value of the land. There were some internal conflicts with the bill particularly line 16, page 2, where it stated, "agrees that they will provide water service to the same land." That might be the case for the airport authority but now instead of what the bill was intended to do which was to supply water to the house that was on that land, they were going to supply the water to the golf course that was on that land. Subsection (c), line 33, stated, "may not be converted to an appropriate right" but, in fact, that was what it did. If you gave them a credit for something other than service to the house, then it automatically became an appropriation right.

Mr. Turnipseed stated the law was intended to replace the water service to a house that existed or an empty lot that could have a house built on it and a domestic well could be drilled. Ms. Carson had stated that no more additional permits were being granted in the Truckee Meadows; however, there were 40,000 acre feet of permitted water rights not counting domestic wells in the basin. Additional water rights could be purchased to provide additional expansion of any municipality that operated in the Truckee Meadows or for single commercial usage. There was no way the amount of water any single family pumped could be quantified; however, it was hard to argue the drilling when the same amount of water would be pumped out of the ground under both the old and new bills.

Forfeiture was another issue as there were strict forfeiture laws regarding permitted water rights as 5 years of nonuse constituted forfeiture. He had the authority to regulate a ground water basin if it was being over pumped and that had been done on many occasions. His office tended to get more restrictive on issuing permits and forfeiture of existing rights and the domestic well credit did not have any priority associated with it. If he was required to regulate the ground water pumpage out of all the permitted rights he questioned who would be cut off first.

Mr. Humke asked about the statement there was doubt the authority paid the going rate for water rights as part of that condemnation. Mr. Turnipseed replied, surface water rights were purchased but in the case of the Home Gardens area he did not know how many surface water rights came with that subdivision. Those were subject to a prior change application filed by Sierra Pacific Power Co., rather than the airport authority, but those were the ones subjected to the ongoing litigation.

Mr. Humke asked if the well permits granted under 1939 law were considered a water right. To which Mr. Turnipseed replied yes.

Mr. Humke questioned if it was appropriate to take the usage of 1,800 gallons a day as a norm. Mr. Turnipseed responded permits were not issued for domestic wells as those had been exempted under the law since 1939. If the owner had the appropriate size lot they were entitled to drill a domestic well as long as the proper setbacks and septic tanks were in place. There was also the opportunity for a homeowner to hookup to a municipal system when it was available. It was a change from existing domestic use or potential domestic use in making the domestic well credit available for any new use within the basin.

Mr. Humke pointed out it appeared there was no authorization to increase the total amount of ground water pumped in a ground water basin and was already stated in law. Mr. Turnipseed said it was in existing law that a person that owned a lot could waive the right to drill a well and hook onto a municipal system assuming the water line ran in front of their house. What A.B. 575 proposed was to give the credit somewhere else in the basin for other usage.

Mr. Humke asked if the point he was making was the permitted well right could be transferred anywhere in the Truckee Meadows, because the bill did not say that. Mr. Turnipseed said as an example if a person owned an acre or 5 acres in the Virginia Highlands, they had a right to drill a domestic well. Under existing law if there was a water line accessible to the property, the right to drill a domestic well could be waived and they could hook up to the municipal system. What was proposed was to change that domestic well credit so it could be used for commercial, industrial, or municipal projects anywhere in the basin.

Mr. Humke remarked he did not see anything about basin usage. Terms of the new language talked about combined credits being used within an area served by the public water system. Mr. Turnipseed noted it was within Sierra Pacific’s service area or another water purveyor in the basin. So instead of drilling a domestic well in the Virginia Highlands the homeowner could go to Sierra Pacific to hookup to the municipal system and the water would be pumped out of the Truckee Meadows ground water basin.

Mr. Humke said testimony was given that the credits were going to be used very close to their own land. Mr. Turnipseed replied the bill would not restrict it in some other basin such as Lovelock Valley. Mr. Humke asked if it was an "inter-basin" transfer. Mr. Turnipseed stressed it was an intra-basin transfer.

Mr. Humke questioned if the bill could be amended. Mr. Turnipseed stated the bill deviated from the intent of the 1993 legislation. An amendment would be fine if the rights were for a new use on the same land, assuming the amount of water pumped by the domestic well could be quantified. He added he did not monitor domestic wells but Sierra Pacific did within their service area.

Chairman Bache closed the hearing on A.B. 575.

Andy Anderson, president of Nevada Conference of Police and Sheriffs, presented an amendment to the bill (Exhibit F). NRS 617.135 was the section dealing with worker’s compensation and occupational diseases. They were attempting to identify and increase coverage for individuals under the plan. The amendments would clarify employees in the division of the Department of Motor Vehicles, school police officers, and also investigators employed by the attorney general and the district attorney’s office. In talking with the legislative police officers they elected to opt out because they did not want to have the annual physicals, and the demands on them were lower. The term "security" was being deleted as there were security officers employed by various counties, and he felt they should not be included. The crux of the bill was to assure Police Officer Standards Training (POST) had certified those covered.

Chairman Bache asked if the intent of the bill was to tie peace officer status together for heart and lung disease and also for Public Employees Retirement System (PERS) for early retirement. Mr. Anderson replied two different bills had been submitted, but they more or less contradicted each other. The thrust was to consolidate definition of a peace officer, address early retirement, and deal with occupational diseases and worker’s compensation.

Robert Francke, chief of Field Operations and Maintenance, Nevada Division of State Parks, presented testimony in support of the bill but submitted an amendment to include the Nevada Division of State Parks peace officers (Exhibit G). He felt the division was probably omitted because most people did not realize they performed peace officer duties, and if they were included by definition, it would make them eligible for coverage by the occupational diseases act. The officers in the division were category 1 performing the same duties as officers identified in NRS 617.135. It should be noted it would fiscally impact the division and not was covered in the proposed 2000/2001 budget for the division. In comparing the public safety role of state park peace officers and other law enforcement specialists, they both met the same standards and should be afforded coverage under the occupational diseases act. State park peace officers must meet the same Nevada Peace Officer Standard Training (POST) background training and physical requirements of other category 1 peace officers within the state. They had general powers of arrest and issued citations just as any other peace officer in the state. State parks law enforcement specialists and park rangers worked in uniform, carried firearms, and drove marked police radio equipped vehicles.

He added they were the primary enforcement agency on lands controlled and operated by the division and conducted initial response with follow-up investigations of motor vehicle accidents, crimes against persons, assault, and a myriad of other crimes. They also enforced driving while intoxicated (DWI) problems, boating accidents, as well as hunting and fishing regulations, and other park problems. State park peace officers also responded to emergency medical situations in rural areas as most were certified Emergency Medical Technicians. Because they were involved in search and rescue operations, there was a chance of being exposed to contagious diseases because of the close contact with patients.

There was a fiscal note attached, and it was fairly costly. Although, there were no firm figures in conversing with risk management it appeared the division’s Employees Insurance of Nevada would increase in excess of $30,000 per year. There were also associated costs with the required medical examinations performed on those employees that would be covered. He introduced Steve Silva the senior law enforcement specialist for the division who would answer questions.

Mr. Lee stated he did not want to diminish the state parks responsibility for enforcement, but in looking at the bill, he understood there was a high level of stress in police work and enforcing laws 8 hours a day. He felt the argument could be made that a youth counselor was hired to keep order and the entire idea was becoming too watered down. He realized there were times when state parks had to protect "life and limb," but he had a hard time understanding their amount of stress time.

Steve Silva, senior law enforcement specialist, Division of State Parks, indicated the majority of the rangers lived in housing located within the parks making them available 24 hours to respond to any emergencies, whether for injury accidents or law enforcement incidents. It was true there were a variety of needs between parks for law enforcement services as there were water based recreation areas such as Lahonton, Lake Tahoe, and Washoe Lake where there seemed to be a high demand for law enforcement services. In comparison the historic parks had a much lower incident rate, but the fact remained the officers had to be in place and available to provide service.

He stated in 1990 he was involved in the first shooting concerning a park ranger, when he responded to a burglary in progress call at the Las Vegas Gun Club where he was confronted by a suspect armed with a 12-gauge shotgun. In 1991, two of park rangers arrested an individual at Lahonton who was armed with a sawed off shotgun. The suspect eventually contracted with an individual and attempted to murder the two officers in order to avoid their testimony at his trial in federal court. With intervention by law enforcement the down payment on the contract was made to a Bureau of Alcohol, Tobacco, and Firearms (BATF) agent and that suspect was now sitting in federal prison under a 15-year sentence.

Alex Ortiz, representing Clark County, alluded to a concern with the section relating to investigators employed by a district attorney, and they would like to suggest amending the bill to remove that provision.

Chairman Bache questioned if Mr. Anderson had problems with any of the proposed changes from state parks or Clark County. Mr. Anderson felt the job descriptions of peace officers had increased over time as even 10 years ago, school police would not fit in the category. As time went by responsibilities and pressure increased on all law enforcement agencies. He was not familiar with the actual duties of the park police but felt from the description before the committee, he would agree they needed to be included in the bill.

Ms. Von Tobel asked if there would be fiscal impact on anyone else beside the park police, as it was not mentioned in the bill. Mr. Anderson responded anytime a benefit was increased there was going to be impact on the employer. As an example if the district attorney’s employees were involved, that office may be required to provide annual physicals. So that would be an increased cost to the agencies. Part of the requirement for worker’s compensation was having annual physicals and it was also part of the POST certification requirements.

Ms. Von Tobel stated if there was a fiscal impact, she assumed the bill would have to be referred to the Committee on Ways and Means. Chairman Bache agreed if state parks were included in the bill, as there would be a fiscal note.

Chairman Bache indicated the proposed amendments were from Mr. Anderson, state parks, and Mr. Ortiz.

THE MOTION CARRIED UNANIMOUSLY.

Vivian Freeman, Assembly District 24, explained the bill resulted from a park fee bill passed many years ago. At one time it was 2 percent of the cost of a home for a fee for parks in the area, and then reduced to 1 percent but it did not raise enough money to address the issue of parks for many of the municipalities. She indicated large sections of the bill, regarding libraries, was being deleted because of differing descriptions in the statutes. Also she was deleting the part regarding impact fees for schools, even though she was convinced it could be amended in such a way it could be used for high-end repairs for old schools. What remained in the bill was the neighborhood park issue and park fee. It also raised the cap from $1,000 to $2,000 per dwelling which allowed low-income areas the option of charging whatever was less, based on the value of the home. The bill only dealt with neighborhood parks and defined as a site not exceeding 25 acres.

Dave Ziegler, Legislative Counsel Bureau Research Division, said it was his understanding that under current statute, the residential construction tax was authorized to be as much as 1 percent or $1,000 to simplify the cost of the home. That would keep it at 1 percent but would raise the cap to $2,000. The effect of that was a home under $100,000 would not be changed but a home assessed over $100,000 would go to 1 percent with a cap of $2,000.

Mrs. Freeman said there would be provisions allowing the local entities to impose a formula for use by low-income residents, the amount of land going to parks, and the ideal mix as compared in municipalities throughout the county.

Irene Porter, executive director, Southern Nevada Homebuilders Association, spoke in opposition to the bill. She appreciated the fact that Mrs. Freeman had removed the libraries and school impact fee issues and elected only to the increase on the cap on the park tax. However, the increase could mean a 100 percent tax increase to some homeowners when they bought a new home as it was done on the basis of valuation set by each local government. In southern Nevada that valuation was being raised to $36 a square foot, and some other parts of the state may even be as high as $80 a square foot for park tax. Parks were important, but when the tax law was first put in place it was only meant to supplement the park fund of the local government.

The intent was not supposed to be the only funding in new parks and certainly not replacement money in the old areas of a community. Unfortunately, over the years local government had financial constraints in their communities. Ms. Porter added that too often park tax money became a replacement for general fund funding in all communities. The tax funding was to be used in the new communities for the parks, and there were a number of years it was used for maintenance and rehabilitation in the older areas. That was not the intent unless there was a nexus between new and old housing in the area.

She felt the bill did not really solve the problems that Mrs. Freeman had in the older areas. The only real solution was probably a commitment of general fund money or a bond issue in the community for an enhanced park program. There was a bill coming over from the Senate allowing impact fees for parks in lieu of residential construction tax. Then the money could be used within those districts in a wider area of capital improvements and both new construction and existing residents would pay their fair share. It was felt that the park tax had actually damaged park programs in the state and she opposed increasing the cap to $2,000.

Mrs. Freeman stated she only became aware of the Senate bill a day or two before the meeting. Dan Musgrove, city of Las Vegas, acknowledged it was S.B. 457, and was presently scheduled for a work session. The impact fees tended to spread the burden over all of the residents who would actually use the park and benefit from it. The bill as written would affect the entire state and added parks to fire suppression in existing statute.

Ms. Porter pointed out when looking at how park tax was administered statewide there were park tax districts consisting of 8 square miles with one new development at one end. That district was paying for a park or upgrading an old park that might be 7 or 8 miles away and the new development would not derive any benefit for their tax dollar.

Mrs. Freeman understood Ms. Porter’s point, but given her district where there were no parks in the newer part of town, the parks in the older part of town experienced so much use, and there was no money to rehabilitate them. She stressed there had to be a way to address those issues.

Ms. Porter thought if there was an area where there may not be a lot of development then funding should come from the general fund or bond issues should be considered. Mrs. Freeman said she would check to see if the senate bill accomplished her intent with A.B. 510.

Mr. Lee thought Mrs. Freeman brought up a good issue as in the older sections of town the only time there was money available for upgrading was when a resident within the park district added onto their home. When a permit was received, a percentage of the fee went into the park fund. In looking at the bill he wondered if there was a way to make a small increase to the residential add-on permit.

As there was no further testimony Chairman Bache closed the hearing on A.B. 510.

Maddy Shipman, representing Washoe County, testified in support of the bill, and would only affect Washoe County by virtue of the program of annexation, which only Washoe County had. All the entities involved totally agreed to the bill despite the annexation issues in the north. What the bill did was make it clear that when annexation took place, it was done along a parcel line so there would not be any confusion over whether the parcel was in the city or county, or for voting purposes, whether the resident voted for city offices or not.

Ms. Tiffany questioned where it was designated that it only affected Washoe County. Ms. Shipman said it was specified under NRS 268 but only related to certified programs of annexation and only counties having a regional plan that was set up in those specific sections of NRS 278.

ASSEMBLYMAN NEIGHBORS MOVED TO DO PASS A.B. 640.

ASSEMBLYWOMAN GIBBONS SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY.

Chairman Bache announced there would be a work session both Thursday and Friday. As there was no further business the meeting adjourned at 11:00 a.m.

RESPECTFULLY SUBMITTED:

Virginia Letts,

Committee Secretary

APPROVED BY:

Assemblyman Douglas Bache, Chairman

DATE: