The Committee on Government Affairs was called to order at 8:20 a.m., on Friday, May 7, 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

Senator Jon Porter, Representing Clark County Senatorial District 1

Senator Raymond Shaffer, Representing Clark County Senatorial District 2

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

Jeff Harris, Manager, Parks Planning, Clark County Parks and Recreation

Bill Thornton, Board of Directors, Sierra Development Company

Roberta Ross, Owner, The Ross Manor

Bob Rusk, General Partner, Truckee River Lodge

Fred Hillerby, Representing the American Institute of Architects (AIA)

Phil Rosenquist, Assistant Director, Clark County Comprehensive Planning

Toby Lamuraglia, Representing himself

Jeff Ceccarelli, Vice President of Distribution, Sierra Pacific Power Company

Stephen Smith, Associate General Counsel, Nevada Power Company

Carole Vilardo, Representing Nevada Taxpayers Association

John Sande, Representing Basic Management, Incorporated

Mary Walker, Representing Carson City

The following meeting was simultaneously videoconferenced in Las Vegas.

Senator Jon Porter, representing Clark County Senatorial District 1, said S.B. 377 would provide for 20 acres of property in Laughlin to be transferred to the county for park development. He then deferred time to Jeff Harris, manager, Parks Planning, Clark County Parks and Recreation.

Mr. Harris read from prepared text (Exhibit C). In 1987, the legislature had authorized the Department of Conservation and Natural Resources to prepare a development plan, in cooperation with Clark County, for the Big Bend State Recreation Area. The 20-acre parcel of land to be developed by the county for a regional facility included an area for organized sports; however, the transference of land had never commenced until the proposal of S.B. 377.

Mr. Harris provided information on the population of Laughlin. It had been anticipated the population would grow from the current status of 8,000 to 30,000 over time. Currently there were 16 acres of developed park that serviced the entire community.

Responding to Ms. Berman’s question, Mr. Harris said the 20-acre parcel of land had always been targeted for a park. Referring to page 2 of Exhibit C, he pointed out the map had been taken from a 1992 improvement plan for the state park. The map indicated the county park site (highlighted in green). The map on page 3 depicted how the county desired to develop the parcel of land. He assured the committee the 20-acre parcel of land would be obtained and developed strictly for a park site.

Ms. Berman asked how many people in the area would utilize the park, to which Mr. Harris replied currently there were 8,000 people who resided in Laughlin; however, the population was anticipated to grow to 30,000.

Ms. Berman asked how frequently the proposed park would be utilized for an area that was basically a visitation area. Mr. Harris replied the existing 16-acre park experienced tremendous utilization. An additional park site would relieve the burden of use for the existing park, as well as provide extra recreational space for the anticipated population growth. Because the department did not have the foresight to select park sites in anticipation of future growth and development, they were presently in the position of having to find those sites quickly.

Ms. Berman commented her problem with the bill was she had as many, if not more, people in her Assembly district, and there had been no attempt to swap land for parks in that area.

Mrs. Freeman asked Mr. Harris to comment on the expenses anticipated to be incurred by the state land registrar, which the county would pay. Mr. Harris replied he was not familiar with the costs involved, but the county would pay any expenses incurred.

Pamela Wilcox, administrator, Department of Conservation and Natural Resources, Division of State Lands Registrar, called the committee’s attention to the division’s deed when land had been received from the Colorado River Commission (Exhibit D). Referring to page 2, Ms. Wilcox indicated the land was acquired under the provision it be utilized for recreational purposes only and would not be subject to subsequent sale. The land would be transferred to the county at no cost on the condition it would be used for that strict purpose. Because Ms. Wilcox did not have the authority to transfer the land under statute, S.B. 377 was required for legislative examination. She did not anticipate any costs and appraisal of the land was not necessary.

Ms. Segerblom remarked as a co-sponsor of S.B. 377, she wanted to assure Ms. Berman of the necessity for the 20 acres. The land for the proposed park site was near a state park, which was currently being utilized to a great extent.

Responding to Ms. Berman’s question regarding item 1, page 2 of Exhibit D, Ms. Wilcox said verbiage included in the item would be a restriction on the deed. Language was taken from NRS 321.120, which was a statute allowing the state to accept lands from any of those indicated parties, but on the condition any land accepted was used for recreational purposes. When the land was transferred to the county, that same language would be used and would include a provision prohibiting any subsequent sale of the land. Ms. Wilcox said she would provide Ms. Berman with a copy of the verbiage to be included on the deed of transfer to the county; however, at the present time, she did not have the deed because the division did not yet have the legislative authorization to proceed.

Ms. Wilcox understood Ms. Berman’s skepticism, and added, since the state park would remain an immediate neighbor to the 20-acre county park, the division would aggressively enforce the deed restriction.

Mr. Humke asked if it was the intent of the Colorado River Commission the land should be used for recreation in that area and if it was logical for that land to be granted to the county. Ms. Wilcox replied affirmatively. The land granted to the county by the commission was ideally suited for recreational purposes.

Responding to Mr. Humke’s question, Ms. Wilcox said the restrictive covenant would run with the land and was enforceable.

Mr. Humke asked if the county tried to sell the land to a developer, how would a citizen obtain a redress or grievance for enforcement of the restrictive covenant. Ms. Wilcox did not want to comment if a citizen would have standing in court; however, her agency would have standing to sue.

By request of Mr. Humke, Ms. Wilcox described the state’s inventory of land and associated locations and the policy of transferring lands for recreational use. The Division of State Lands held title to all of the state’s lands with the exception of land held by the Department of Transportation by the University System. Lands were held in trust for various purposes on behalf of people in Nevada. A variety of different deed restrictions applied to each piece of land, and it was the duty of the division to track all those restrictions in order to ensure the enforcement of restrictions, as they might be applicable to specific pieces of land.

Mr. Humke asked if that particular situation was not unusual for the State Lands Registrar, to which Ms. Wilcox replied it was a very common practice.

Mr. Mortenson asked if there were situations in which a citizen did not have court standing. Ms. Wilcox replied she was unsure and refrained from commenting any further.

Wayne Perock, administrator, Department of Conservation and Natural Resources, Division of State Parks, assured the committee all the state parks had federal encumbrances. Numerous county parks were included in 6-F jurisdiction including Big Bend of the Colorado State Recreational Division. Mr. Perock said he was bound by agreements with the National Park Service to enforce those jurisdictional regulations. He strongly supported S.B. 377.

Responding to Ms. Segerblom’s question, Mr. Perock said Big Bend was one of the division’s newest parks with regard to development. Visitation to the park numbered approximately 40,000 per year, and a great deal of those visitors utilized the river for boating and water activities.

Continuing, Mr. Perock said state parks were part of the tourism equation. Not only did those parks encourage tourists outside Nevada to visit, but also state residents living in other parts of Nevada, as well. The proposed park would greatly benefit Laughlin’s economy. No further discussion ensued.

William Osgood, representing Downtown Improvement Association, expressed support for S.B. 530. The reason cited was Nevada was the only state that did not have enabling legislation allowing for municipalities to create business or commercial improvement districts. S.B. 530 would allow property owners in a commercial or business area to assess themselves. The assessments would then be gathered and contracted with a nonprofit organization accountable to the property owners. The creation of a business or commercial improvement district would bring about efficiencies in marketing, cleanliness, security, and promotion in order to keep businesses alive. Times Square was an example of such a business district and was a continuing success.

Mr. Osgood said a business district in the downtown Reno area would allow a steady revenue stream that would provide much needed services and would address specific problems, such as panhandling. He said S.B. 530 would be applicable statewide, and would be instrumental in bringing about urban rebirth. He urged the committee’s support.

Ms. Parnell asked if the assessment would be equal to all business. Mr. Osgood replied the assessment would be based on linear frontage. The larger the linear frontage, the greater the benefit to the property.

Responding to Ms. Parnell’s question, Mr. Osgood said the assessment would not be harmful to small businesses. Referring to section 8, subsection 2, he said the property of a single owner may not be counted as constituting more than 10 percent of the basis for assessment.

With regard to section 11, subsection 2, Mrs. Freeman asked if Mr. Osgood was satisfied with the verbiage that proposed to protect the funds in order to make improvement districts possible. Mr. Osgood replied he was very satisfied. He did not feel anything less than stated was desired.

Mrs. Freeman asked if there would be an internal auditor involved in the entire process, or would the governing body be responsible for periodic audits. Mr. Osgood replied the intent would be to have an internal auditor to ensure strict accountability the ratepayers’ funds were utilized according to their directions.

Mrs. Freeman asked if the local governing bodies who were in support had reviewed the bill. Mr. Osgood said he not aware of all the governing bodies; however, he was aware of some located in Las Vegas, Reno, and other communities.

Mrs. Freeman commented she supported the concept proposed by S.B. 530, and added she wanted assurance the required controls were in place in order for communities to benefit. Mr. Osgood said the governmental body determined there was public interest in the creation of the improvement district.

Chairman Bache commented he received calls from individuals whose homes were interspersed with commercial areas and had been concerned with being pulled into the improvement district. He did not see a provision in the bill that would prohibit those residences from being included in the commercial improvement district and asked if an amendment was needed. Mr. Osgood replied the petition would not be developed by parcel but by linear footage. The improvement district would be strictly for promoting business and commercial matters. Residential properties could be excluded.

Mr. Humke asked if the petition that created the improvement was based on linear footage, to which Mr. Osgood replied that was correct. In terms of a percentage requirement, the assessment would be based on the linear footage. He reiterated one property could not constitute more than 10 percent, which would cap a large property’s impact.

With regard to a small business versus larger casinos, Mr. Humke asked how would the district provide for the minority business purposes. Mr. Osgood said in order to initiate the improvement district, property owners within the district would need to be sold on the idea. Surveys conducted in the downtown Reno area had determined the services most desired by business owners were cleanliness and security. The plan would then be tailored to those needs.

Mr. Humke asked if, in the downtown district in Reno, there was a special assessment of additional police services, provided by the Reno Police Department that the businesses currently paid, and would the security service be in addition to existing police services. Mr. Osgood replied currently within Reno there was a police tax assessment district, which provided $905,000 for 14 additional police officers. The district was located over the core of downtown Reno extending to the Gold Dust West casino. Within the composition of the Reno downtown business improvement district, the intent of the bill would be to offer alternatives to security.

Mr. Mortenson asked if Mr. Osgood would comment on several other projects that had accomplished the development of a business district whereby the outcome had been extremely successful. Mr. Osgood replied those business districts that had been successful included: Times Square, Denver, San Diego (which had a multitude of business improvement districts), and the Baltimore wharf area. The business improvement district would also manage the environment. By effectively managing the environment, the incentive for more development was provided.

Mr. Mortenson remarked he supported S.B. 530 because it saved a great deal of the taxpayers’ money.

Mr. Freeman asked if there would be any cost to local government with the passage of S.B. 530. Mr. Osgood replied if there was a cost it would be the local government’s role to collect the assessment and contract out with a nonprofit association.

David Howard, representing Greater Reno-Sparks Chamber of Commerce, testified the chamber of commerce was in support of S.B. 530. The creation of a business or commercial improvement district would provide a tool in which to help revitalize cities. He felt there was an adequate amount of safeguards against dissolution should the districts prove unsuccessful.

With regard to residents concerned with interspersion of commercial districts, Mr. Howard said those individuals should be advised of the benefits some residential areas would experience from S.B. 530. He provided an example to the committee of a particular residential area that would benefit from the proposed intent. No further discussion ensued.

Dan Edgington, senior director of operations, Fitzgerald’s Casino, said he had been involved in redevelopment and economic development of downtown Reno for 22 years. He provided the committee with information on various boards on which he presently sat as a member, which included the Citizen Advisory Committee for the city of Reno, the Task District Board, the Fire Department Museum Committee, and downtown maintenance. He believed S.B. 530 was critical for downtown development. It would allow for private sector assessments so assistance from the public sector would not be required for downtown improvement. He urged the committee’s support.

Mike Forche, president, Las Vegas City Center Development Committee, testified in support of S.B. 530. He believed business improvement districts allowed for self-determination by the businessowners within the district. The creation of improvement districts had been determined to decrease crime and increase cleanliness. He echoed some of the sentiments previously expressed.

Peter Thomas, member, Las Vegas City Center Development Committee, expressed support of the board for the proposed legislation. He provided the committee with a reason for support of S.B. 530, which included the shortage of funding the redevelopment effort of Las Vegas experienced. If enacted, the bill would allow for private capital to be received for the redevelopment effort. Another reason cited was involvement of the citizens within the district furthered the redevelopment effort.

Mr. Thomas said the board was concerned with section 8, subsection 2, whereby written remonstrances received by the governing body by the owners of tracts constituting one-third or more would halt the plan to initiate a business improvement district. He suggested an amendment that would allow the supermajority of the city council to proceed with the plan should the council determine the improvement district would benefit the city.

Bill Thornton, board of directors, Sierra Development Company, provided background information on the company’s operations and the life of the business. Recently, Sierra Development Company had purchased and taken over two businesses, the Virginian Hotel and the Riverboat Hotel and Casino, which had previously been closed. For the last several years, the company had participated in two self-assessment districts with other downtown property owners. Mr. Thornton said the development company had also participated by voluntarily allocating employees in order to help the city with the street cleanliness program. S.B. 530 would allow formalization and establishment of procedures for those types of self-assessments. He urged the passage of S.B. 530.

Roberta Ross, owner, The Ross Manor, provided the committee with some information on her 163-unit residential hotel and apartment complex. She informed the committee of the boards on which she served, which included the chamber of commerce and Redevelopment Citizens Advisory Committee, in order for the committee to understand additional reasons she presented testimony.

Ms. Ross recently presented testimony to Arlington Towers board members during a meeting. The safe security policing of downtown would be beneficial to the residents of Arlington Towers, and she believed their support of S.B. 530 was needed. She concurred with previous testimony.

Mrs. Freeman asked Ms. Ross to comment on the suggestion for an amendment provided by Mr. Peter Thomas, to which Ms. Ross replied any opposition to the plan should return to the property owners for another vote, rather than to a city council.

Chairman Bache said those calls he received were from residents of Arlington Towers who were concerned if their complex was included in the development of the business improvement district they would experience an increase in rent. Those residents had no problem with the development of the district; however, they preferred to be excluded. Ms. Ross explained those residents did not realize the dangers associated with walking unsafe streets at night and how greatly each would benefit from the improvement district.

Mr. Mortenson remarked if the downtown area improved, those condominium owners’ property values would increase greatly.

Bob Rusk, general partner, Truckee River Lodge, stated he had represented downtown Reno for a number of years and had served as the minority leader in the Assembly during the 1981 Legislative Session, he then provided the committee with personal and background information related to being a business owner. He said the proposed enabling legislation would assist those businessowners who desired to govern their own destiny, and urged the passage of S.B. 530.

Mr. Humke remarked the efforts made by Mr. Rusk, Mr. Thornton, and Ms. Ross with regard to downtown Reno development effort had been tireless and much appreciated.

Fred Hillerby, representing the American Institute of Architects (AIA), stated the institute’s growth committee viewed the bill as a good vehicle to encourage infill development. The institute supported S.B. 530, and he added previous testimony was appreciated.

In answer to Mrs. Freeman’s question with regard to the suggested amendment, Mr. Hillerby said the institute did not have a position at the present time.

Responding to Mrs. Freeman’s question, Mr. Hillerby said he would review the information proposed by the amendment and the institute’s position, and get back to her.

Karen Zaustinsky, executive director, Downtown Central Development Committee (DCDC), Las Vegas, provided information on the committee which was composed of small businessowners, residents, staff from various city departments, and other professionals all working together to speak on critical issues in the downtown area. The members had expressed a great deal of support for the bill. The small businessowners realized individually they would not be able to fund the revitalization of their business areas; however, collaborating with business neighbors would enable not only the improvement of the downtown business district but would also provide for greater economic viability.

Helena Garcia, president, Downtown Central Development Committee (DCDC) Las Vegas, testified in addition to being on the committee, she was also a downtown business owner. In partnership with the city of Las Vegas Neighborhood Services, the DCDC was in the process of developing recommendations, recommending policy, and development activities in order to revitalize downtown Las Vegas. The organization was well educated on the benefits associated with S.B. 530 and believed it provided a significant tool for small businesses to share in the cost of improving their commercial area. She thanked the committee for the opportunity to speak on behalf of the development committee, the community, and small businessowners. She urged the support of S.B. 530.

Virginia Valentine, city manager, city of Las Vegas, echoed the sentiments previously expressed.

With regard to Mrs. Freeman’s concerns about a supermajority of the city council, David Howard, representing Greater Reno-Sparks Chamber of Commerce, stated the downtown redevelopment district had been created in the 1983 Legislative Session. A provision in the bill stated the unanimous vote of the city council had been required in order to expend any funds for the development of a project. In 1985, the chamber of commerce returned to the legislature in order to get that provision amended due the refusal of one member to participate in the first redevelopment project. That particular action had cost the city of Reno and its taxpayers approximately $4 million. He recommended if the committee was considering an amendment, to make it a supermajority of the council.

Carole Vilardo, representing Nevada Taxpayers Association, stated she had not intended to speak on S.B. 530; however, she was concerned about city council being able to override what the businessowners wanted and opposed the amendment suggested by Mr. Peter Thomas.

Mr. Thomas returned in order to provide clarification if the proposed amendment to S.B. 530 was going to be considered. The amendment intended to allow for the supermajority of a city council to proceed with the development of a business improvement district if it was felt to greatly benefit the city and businessowners, despite the fact one-third of the property owners objected to the plan. In the bill’s current form, if one-third of the property owners objected to the development of the district, two-thirds of the majority’s efforts were thwarted.

Chairman Bache asked if, in that case, would the proponent of the business district redraw district lines in order to exclude those objectors. Mr. Thomas replied that was a possibility, but if those businesses were excluded to the extent the exclusion included a significant percentage of people who would benefit from the creation of the business district, economics would set in and the bill would die.

Chairman Bache remarked 30 percent of property owners was not a significant portion objecting, and there would be quite a bit of aggravation in being forced to pay taxes for a development some individuals and residents did not want. Mr. Thomas said the committee had to decide if 30 percent was really enough to stop 70 percent from proceeding with the creation of the business district. He proposed rather than letting the plan die, allow the elected officials to examine the issue one additional time before a final decision was rendered.

Mr. Osgood returned to explain those initiating the creation of the district had the burden to bring forth a petition to which the majority of business were in agreement. A district needed to be crafted in such a way there was a real buy-in; therefore, he felt 30 percent was an adequate percentage for remonstrance.

There being no further testimony, Chairman Bache closed the hearing on S.B. 530. He informed the committee S.B. 530 would be taken up in work session for a vote in the next week.

James Spinello, representing Clark County, informed the committee testimony provided on May 6, 1999, regarding the regional planning coalition’s position on S.B. 191 was erroneous. He introduced Phil Rosenquist, assistant director, Clark County Comprehensive Planning, to explain the issue.

Mr. Rosenquist apologized to the committee and the sponsor of S.B. 191 for any misrepresentation that might have occurred. He said he wrote the testimony for S.B. 191 based on the recollection of the April 8, 1999, meeting of the Southern Nevada Regional Planning Coalition. The specific point of concern was testimony had indicated the planning coalition was opposed to S.B. 191. The minutes indicated the planning coalition moved to not take a position on S.B. 191.

Mr. Spinello added he appreciated the opportunity to set the record straight.

Chairman Bache appreciated the honesty of both gentlemen, thanked them for their appearance, and opened the hearing on S.B. 384.

Senator Raymond Shaffer, representing Clark County Senatorial District 2, clarified S.B. 384 involved only electrical utilities, and prohibited high voltage lines, over 50,000 volts, from being placed on property without the owner’s consent or knowledge. Problems arose when an owner of a piece of property on which the power company had located a high voltage power line without consent tried to gain compensation for the taking of, or damage to, that property. S.B. 384 would require compensation to be paid to the owner of that property.

Senator Shaffer explained if the statute of limitations (5 years) had expired, the power company was able to get out of having to compensate the owner. The bill would increase the statute of limitations to 15 years. The legislation also addressed who was responsible for attorney’s fees should litigation become a requirement. He urged support of S.B. 384 as a remedy to help those anguished by the damage to personal property.

Toby Lamuraglia, representing himself, related some personal information to the committee and added over the years he had purchased 15 to 20 pieces of property in outlying areas. Upon visitation to one of the pieces of properties he had purchased, he had discovered power poles had been placed without his consent. He then contacted the power company in order to speak with someone regarding those power lines placed on his land and could not get an appointment for a meeting, and because the statute of limitations had expired, he would not be compensated for the loss.

Upon hearing S.B. 384 would be presented in the Assembly, Mr. Lamuraglia had received a letter from the attorney for the power company who gave him a settlement amount, to which Mr. Lamuraglia made a counteroffer. He requested $130,000 (the amount the land was currently worth), but would decrease the amount to $105,000. At that point, he had been informed the negotiations were concluded.

Continuing, Mr. Lamuraglia stated because people speculated all over the country, it was possible to be unaware of foreign objects on personal property for years; however, because of the records kept by the state, property owners could easily be located. He stated it had taken him 3 years to gain compensation for the taking of his property and had lost three or four lots because of the power lines running through the land.

Mr. Lamuraglia remarked if power companies did indeed contact all property owners before placing high voltage power lines, they should not have any problems with S.B. 384.

Vice Chairman Lee clarified for the committee 240 volts was written in error. The verbiage should read 50,000 volts.

Mr. Humke was concerned with the time period of 15 years after the time of discovery. There was a concept in the law of adverse possession whereby if someone was altering another person’s land in an open and notorious fashion, it was the duty of the landowner to inform that person to leave; however, buried wires were harder to discover, and thus not "open and notorious."

With the provided background information, Mr. Humke asked Mr. Lamuraglia for the reason behind the discovery period of 15 years. Mr. Lamuraglia replied some individuals purchased land great distances away. In some occasions, those individuals did not examine property for many years.

Mrs. Segerblom asked for what amount Mr. Lamuraglia purchased the property, to which Mr. Lamuraglia replied he purchased the property at an auction for approximately $8,000.

Mrs. Segerblom asked if it was worth the amount for which he requested he be compensated. Mr. Lamuraglia replied affirmatively. He could sell the land for $300,000. He had already been offered that amount; however, because of a current contract with a sign company he could not sell the property.

In response to Mrs. Segerblom’s question, Mr. Lamuraglia said he had already obtained a settlement from the power company regarding another piece of land so he did know enough to look out for his other properties.

Mr. Lee related a story for the benefit of the committee regarding a friend who had purchased property and upon visitation to the property, it had been determined the actual piece he owned was in back of another individuals piece of property. Small parcels in and amongst a larger piece of property could, at times, be difficult to locate.

Ms. Von Tobel commented the original version of the bill contained verbiage that referenced 90 days in which to purchase disrupted land had been changed to 15 years in which to recover compensation for land that had been disrupted. She asked what was the reasoning behind such a tremendous difference. Mr. Lamuraglia replied in the original version of S.B. 384 the power company was required to purchase the land that had been disrupted from the property owner. Senator Shaffer then amended the verbiage to state the property owner had 15 years in which to recover compensation from the power company, either in back rent or outright compensation.

In response to Ms. Von Tobel’s question, Mr. Lamuraglia said the time period for compensation did not necessarily have to be 15 years; however, there needed to be a time period for discovery and claim submission.

Mr. Mortenson remarked it was an individual’s fundamental right to gain compensation for infringement upon a piece of property. Because the property was owned indefinitely, he did not see the reason for any statute of limitations for recovery of compensation. No further discussion ensued.

Steven Rigazio, vice president of finance, chief financial officer, Nevada Power Company stated both Nevada Power and Sierra Pacific Power Company were opposed to S.B. 384. He pointed out that the power companies did not take private property without due process or just compensation, and power lines were not placed wherever the company thought fit to place them.

Mr. Rigazio explained S.B. 384 was special legislation for one specific situation, but it had significant and serious policy consequences as written, or even as amended. If passed, the bill would have a serious impact on economic development, the ability to provide access into developments in which to provide new service, and cost consequences to customers and ratepayers in the state.

Mr. Rigazio pointed out for the record the power line had been placed on Mr. Lamuraglia’s property prior to his purchasing the land. He remarked the company did have a permit and provided a copy to the committee (Exhibit E). In reference to remarks that had been made regarding discussions with the company and compensation for previous property, a letter had been provided to the committee from Mr. Charles Lenzie, chairman of the board, chief executive office, Nevada Power Company, that described the situation (Exhibit F). He deferred time to Mr. Roullier.

Bill Roullier, director of land services, Nevada Power Company, provided the committee with details relating to his responsibilities regarding his position as director of land services with the Nevada Power Company, which included locating positions for transmission lines and acquiring property rights, and permits for running transmission lines. An extensive process in order to site the line and acquire rights for those lines was upheld by the both Nevada and Sierra Pacific Power Company. He stated S.B. 384 presumed the company did not perform those acquisitional duties.

In addition, Mr. Roullier stated both companies underwent an open house process in which the public was invited to voice concerns, provide input, determine suitable locations, and aid in the design of the transmission lines that would benefit the community. The companies were involved in the local land-use planning guides for locations in which proposed power lines were to be placed. Approval was sought from the community prior to seeking approval from the governmental entities before the placement process was started. He stressed by the completion of the approval process there had been at least two public notices.

Continuing, Mr. Roullier said land rights were acquired after approval had been obtained from local jurisdictions and the state. Numerous entities were dealt with in order to acquire those rights, such as the Federal Government, Bureau of Land Management (BLM), and other property owners. Each and every parcel owned by a private entity was then appraised for its worth. Based on the information received from the independent appraiser, the power companies then negotiated with property owners of record at that time. He explained the companies negotiated to a conclusion or, on occasion, the value was settled in court. He explained the easement right needed to be acquired in order to place the power lines.

Mr. Roullier reiterated power lines had already been present prior to Mr. Lamuraglia’s purchase of the property. In 1968, the company had acquired a BLM permit in order to place power lines on a piece of property. Unfortunately, before the permit had been physically handed over to the power company, BLM had sold the land. In 1974, Mr. Lamuraglia had purchased that same piece of land encumbered with the present power lines.

With regard to the permit attained from the Nevada Department of Transportation (NDOT), Mr. Roullier said Nevada Power Company had paid a one-time sum commensurate with the value of the land for the right to place the power line. Because Nevada Department of Power had already given compensation for the taking of the land, they felt it was unnecessary to compensate Mr. Lamuraglia any further. He stressed it had been alluded the company did not attempt good-faith negotiations with those individuals on whose land power lines had been placed; however, they did negotiate in good-faith with all property owners, including Mr. Lamuraglia.

Mr. Roullier said all property owners had rights and responsibilities to the land they owned or would soon purchase; therefore, they should take it upon themselves to examine any property they were going to procure. In both cases presented by Mr. Lamuraglia, there were power line access roads on the property.

Jeff Ceccarelli, vice president of distribution, Sierra Pacific Power Company, was concerned about the potential impacts to Sierra Pacific Power Company and their customers if S.B. 384 was implemented as written. In his 20 years of distribution experience, he could recall only two incidents whereby there had been a property conflict. Those conflicts had since been resolved on a one-on-one situation. Commenting on its current form and referring to section 1, subsection 3 of S.B. 384, Mr. Ceccarelli said if left in the form of 240 volts, there would be problems because there were service drops provided to all commercial customers or residents whereby voltage exceeded that amount. In those situations there were no specific rights-of-way or easements, as those services were provided only through an application process and could be contested. He was also concerned with the power company being able to extend facilities relating to current public utility easements without having to obtain express written permission of the property owners. As written, S.B. 384 could block the power companies’ obligations to serve, thereby delaying a project.

With regard to section 1, subsection 1, Mr. Ceccarelli was unsure what the phrase "…any hazard resulting from the presence…" meant. The power companies were in the business for reliability and public safety and there were specific federal and local requirements that needed to be met in order to put facilities into place.

Mr. Ceccarelli concluded by stating he felt S.B. 384 was unnecessary and urged the committee’s defeat of the bill.

Stephen Smith, associate general counsel, Nevada Power Company, pointed out both Sierra Pacific Power Company and Nevada Power Company felt S.B. 384 was special and private legislation intended to benefit a single property owner who had not pursued action in court. There were existing remedies within the law for Mr. Lamuraglia including filing an action for inverse condemnation seeking just compensation. He cited a prior case in which the same action had been filed, the plaintiff withdrew his case; however, Nevada Power Company was able to settle amicably.

Mr. Smith provided the committee with information relating to the various types of easements, which included written, implied, necessity, and prescriptive easements. S.B. 384 seemed to focus on requiring written easements. In many cases, the utility department would not be able to produce a written-recorded easement of record. All electric facilities were erected with the permission of either the government or the BLM. The facilities when turned over to private landowners then accrued property interest. He felt it would not be fair to customers for a property owner to ask that the lines be moved at the expense of the power company. He felt S.B. 384 would weaken prescriptive easement rights, which were available to any entity attaining rights by adverse possession. S.B. 384 would increase the period of adverse possession from 5 to 15 years.

Mr. Smith concluded his presentation by pointing out the statute of limitations in action for inverse condemnation, under a case decided by the Nevada Supreme Court was 15 years in order to ascertain if there had been a taking of property. He believed the bill would negatively impact the power of the utility department to exercise eminent domain and would be used to tie up property acquisition.

Mr. Mortenson remarked he concurred with the sentiments of Mr. Roullier, and provided the committee with a personal story of his attendance at a public meeting with Nevada Power Company. He asked if established property rights for a particular property purchased by Mr. Lamuraglia would be included in the deed to the property. Mr. Smith replied the power lines existed on both pieces of property prior to being purchased by Mr. Lamuraglia. He was unsure if there was a statement on the deed indicating the existence of power lines.

Because S.B. 384 was a prospective bill in for consideration, Mr. Lee requested Mr. Smith meet with Mr. Lamuraglia in effort to consider future parties that may be adversely affected by placement of high voltage power lines on their property.

There being no further testimony, Chairman Bache closed the hearing on S.B. 384.

Referring to section 1, Carole Vilardo, representing Nevada Taxpayers Association, said that particular verbiage would ensure the integrity of the bonds and would be added into statute; however, she wanted to make it clear it only added into statute what already existed in other areas.

The verbiage of section 3, subsection 2, had been added in order to address a problem that had occurred when a county decided to utilize redevelopment law for economic development. Economic development was used with the intent of creating an area to which business would be attracted. The increment would then be used to pay those bonds, and additional funding would not be available for police and fire services. She said the verbiage was not as originally presented, but it had been accepted by the redevelopment agencies in the area.

John Sande, representing Basic Management, Incorporated, read from prepared text (Exhibit G). He clarified "improved land," as defined in section 3, subsection 5, was broadly construed. He wanted to ensure it was understood that "structures" included in the bill would include industrial wastewater ponds and similar improvements.

Ms. Vilardo added the concern arose because it had been mentioned 75 percent of the area included within a redevelopment area must be improved land (section 3, subsection 2). The Basic Management area had been developed land for a number of years, but it contained more land and types of infrastructure that might not be considered for redevelopment such as wastewater ponds.

Mary Walker, representing Carson City, stated she had worked with Ms. Vilardo for many months developing the bill’s verbiage. She added she had no problem with Mr. Sande’s disclosure that the term "structures" would include industrial wastewater ponds. No further discussion ensued.

There being no further testimony or business, Chairman Bache closed the hearing on S.B. 528 and adjourned the meeting at 10:35 a.m.

RESPECTFULLY SUBMITTED:

Rachel Baker,

Committee Secretary

APPROVED BY:

Assemblyman Douglas Bache, Chairman

DATE: