SENATE JOINT RESOLUTION NO

Senate Joint Resolution No. 12 of the 69th Session–Committee on Finance

FILE NUMBER........

SENATE JOINT RESOLUTION—Proposing to amend the Nevada constitution to allow the

investment of state money to stimulate economic development.

Whereas, Emerging competition in other states and federally regulated

territories threatens the long-term growth of the State of Nevada in its vital

gaming industry; and

Whereas, Financial programs necessary to ensure business expansion and

high-quality job growth do not currently provide the business sector of this

state with adequate access to the types of money and capital essential to

support the growth of a diversified economic base; and

Whereas, The Nevada constitution currently contains restrictions, based

on conditions existing in the 19th century, that have prevented the Legislature

from considering legislation similar to laws enacted in several other states

which would permit prudently managed investments in public-private

partnerships and corporations designed to provide needed sources of capital

for high-quality, job-creating businesses and low-cost housing programs

within this state that cannot feasibly obtain such financing from existing

private financial markets in an easily accessible and efficient manner; and

Whereas, The State of Nevada must remain competitive with other states

in providing the necessary financial tools to attract the types of businesses and

industries that would diversify the economic base of this state and improve the

standard of living for the residents of this state; and

Whereas, The benefits to be derived from an effort toward strong

economic development throughout this state may be jeopardized if current

restrictions in the Nevada constitution are not replaced with more flexible and

contemporary standards that both protect public investments in economic

development projects and provide access to the type of financing needed to

stimulate the growth of businesses and industries throughout this state which

will provide the high-quality jobs, increased property values and enhanced

standard of living desired by Nevadans; now, therefore, be it

Resolved by the Senate and Assembly of the State of Nevada,

Jointly, That section 9 of article 8 of the constitution of the State of Nevada

be amended to read as follows:

[~~Sec: 9. The]~~

Sec. 9. 1. Except as otherwise provided in subsections 2 and 3, the

State shall not donate or loan money [,] or its credit [,] to, or subscribe to or

be [,] interested in the Stock of any company, association, or corporation . [,

~~except]~~
2. The legislature may enact legislation, approved by a vote of two

-thirds of the members of each house, to authorize the investment of state

money in any company, association or corporation for the purpose of

stimulating the economic diversification or development of this state and the

creation of new employment opportunities for the residents of this state,

subject to the following conditions:

(a) Before any such investment is authorized, a determination must be

made by a person or entity designated in the authorizing legislation that:

(1) The investment is for the economic development of this state or the

creation of new employment opportunities in this state; and

(2) This state can reasonably expect to achieve a reasonable rate of

return on the investment, adjusted for the relative degree of risk.

(b) Each such investment by this state must be made through a

cooperative venture with private investors of reasonable sophistication who

participate in the venture on terms that are the same as or less favorable

than the terms on which this state is participating.

Revenue received from investments pursuant to this subsection may be

reinvested subject to the same conditions.

3. The provisions of this section do not apply to corporations formed for

educational or charitable purposes.