SB553_EN

Senate Bill No. 553–Committee on Government Affairs

CHAPTER..........

AN ACT relating to governmental administration; establishing certain requirements for the use of installment-purchase agreements by local governments; removing the requirement that local governments create funds for certain extraordinary maintenance, repair or improvements; creating certain exceptions to the Uniform Commercial Code—Secured Transactions; authorizing the committee on local government finance to adopt certain regulations; requiring the committee on local government finance to adopt certain regulations; prohibiting the use of the proceeds from certain obligations issued by a local government to pay operating expenses; requiring the Nevada tax commission to appoint a subcommittee to conduct a public hearing concerning the management of a local government in a severe financial emergency; requiring the publication of certain regulations in the Nevada Administrative Code; and providing other matters properly relating thereto.

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 350 of NRS is hereby amended by adding thereto

the provisions set forth as sections 2 to 9, inclusive, of this act.

Sec. 2. As used in this chapter, unless the context otherwise

requires, the words and terms defined in sections 3 to 7, inclusive, of this

act have the meanings ascribed to them in those sections.

Sec. 3. “General obligation debt” means debt that is legally payable

from general revenues, as a primary or secondary source of repayment,

and is backed by the full faith and credit of a governmental entity, and if

the governmental entity is authorized to levy taxes, by those taxes. The

term includes, without limitation, debt represented by local government

securities issued pursuant to this chapter and installment-purchase

agreements described in subsection 1 of section 4 of this act. The term

does not include, without limitation:

1. Installment-purchase agreements described in subsection 2 of

section 4 of this act;

2. Special obligations; and

3. Obligations with a term of less than 1 year that are payable in full

from money appropriated for the same fiscal year in which the

obligations are incurred.

Sec. 4. “Installment-purchase agreement” means an agreement for

the purchase of real or personal property by installment or lease or

another transaction that is described in NRS 350.800 which:

1. Is required to be counted against any limit upon the debt of a local

government pursuant to subsection 1 of NRS 350.800; or

2. Is not required to be counted against any limit upon the debt of a

local government and:

(a) Exceeds $100,000 for a local government in a county whose

population is 100,000 or more; or

(b) Exceeds $50,000 for a local government in a county whose

population is less than 100,000.

The term “installment-purchase agreement” does not include an

obligation to pay rent pursuant to a lease which contains no option or

right to purchase or which contains only an option or right to purchase

the property without any credit towards the purchase price for lease or

rental payments.

Sec. 5. “Local government” has the meaning ascribed to it in

NRS 354.474.

Sec. 6. “Medium-term obligation” means an obligation to repay

borrowed money evidenced by a note or bond which is authorized to be

issued pursuant to NRS 350.087 to 350.095, inclusive, and which has a

term of 10 years or less. The term does not include an obligation which

has a term of less than 1 year and which is payable in full from money

appropriated for the same fiscal year that the obligation is incurred.

Sec. 7. “Special obligation” means a municipal security issued

pursuant to NRS 350.582.

Sec. 8. For the purposes of this chapter, the term of an installment

-purchase agreement must be determined as the period from the date the

agreement is entered into by a local government to the date that the

purchase price will be paid in full and must include the term of the

original agreement and the term of any renewal, including, without

limitation, an optional renewal, of the agreement.

Sec. 9. 1. The committee on local government finance may adopt

such regulations as are necessary for the administration of this chapter.

2. Any regulations adopted by the committee on local government

finance must be adopted in the manner prescribed for state agencies in

chapter 233B of NRS.

Sec. 10. NRS 350.001 is hereby amended to read as follows:

350.001 As used in NRS 350.001 to 350.006, inclusive, and sections 2

and 3 of Senate Bill No. 123 of this [act,] session, unless the context

otherwise requires:

1. “Commission” means a debt management commission created

pursuant to NRS 350.002.

2. [“General obligation debt” means debt which is legally payable

from general revenues, as a primary or secondary source of repayment,

and is backed by the full faith and credit of a governmental entity. The

term includes debt represented by local government securities issued

pursuant to this chapter except debt created for medium-term obligations

pursuant to NRS 350.085 to 350.095, inclusive.

3.] “Special elective tax” means a tax imposed pursuant to NRS

354.59817, 354.5982, 387.197, 387.3285 or 387.3287.

Sec. 11. NRS 350.0035 is hereby amended to read as follows:

350.0035 1. Except as otherwise provided in this section, on or

before July 1 of each year, the governing body of a municipality which

proposes to issue or has outstanding any general obligation debt, other

general obligations or special obligations, or which levies or proposes to

levy any special elective tax, shall submit to the department of taxation

and the commission:

(a) A complete statement of current general obligation debt and special

elective taxes, and a report of current debt and special assessments and

retirement schedules, in the detail and form established by the committee

on local government finance.

(b) A complete statement, in the detail and form established by the

committee on local government finance, of general obligation debt and

special elective taxes contemplated to be submitted to the commission

during the fiscal year.

municipality, which must include, without limitation:

(1) A discussion of its ability to afford existing general obligation

debt, authorized future general obligation debt and proposed future general

obligation debt;

(2) A discussion of its capacity to incur authorized and proposed

future general obligation debt without exceeding the applicable debt limit;

(3) A discussion of its general obligation debt that is payable from

property taxes per capita as compared with such debt of other

municipalities in this state;

(4) A discussion of its general obligation debt that is payable from

property taxes as a percentage of assessed valuation of all taxable property

within the boundaries of the municipality;

(5) Policy regarding the manner in which the municipality expects to

sell its debt;

(6) A discussion of its sources of money projected to be available to

pay existing general obligation debt, authorized future general obligation

debt and proposed future general obligation debt; and

(7) A discussion of its operational costs and revenue sources, for the

ensuing 5 fiscal years, associated with each project included in its plan for

capital improvement submitted pursuant to paragraph (d), if those costs

and revenues are expected to affect the property tax rate.

(d) Either:

(1) Its plan for capital improvement for the ensuing 5fiscal years,

which must include any contemplated issuance of general obligation debt

during this period and the sources of money projected to be available to

pay the debt[.] ; or

(2) A statement indicating that no changes are contemplated in its

plan for capital improvement for the ensuing 5 fiscal years.

(e) A statement containing the name, title, mailing address and

telephone number of the chief financial officer of the municipality.

2. The governing body of a municipality may combine a statement or

plan required by subsection 1 with the corresponding statement or plan of

another municipality if both municipalities have the same governing body

or the governing bodies of both municipalities agree to such a

combination.

3. Except as otherwise provided in subsection 4, the governing body of

each municipality shall update all statements and plans required by

subsection 1 not less frequently than once each fiscal year.

4. In a county whose population is 100,000 or more, the governing

body of each municipality shall update all statements and plans required

by subsection 1 not less often than once each fiscal year and not more

often than twice each fiscal year, except that a municipality may update a

statement or plan required by subsection 1 more often than twice each

fiscal year:

(a) If the governing body determines, by a two-thirds vote, that an

emergency requires that a statement or plan be updated;

(b) To include an item related to:

(1) An installment purchase that does not count against a debt limit;

(2) An obligation for which no additional property tax is expected;

rate of the special elective tax; or

(d) To comply with the requirements of subsection 5 of NRS 268.625 or

subsection 1 of NRS 350.091.

5. The provisions of this section do not apply to the Airport Authority

of Washoe County so long as the authority does not have any general

obligation bonds outstanding and does not issue or propose to issue any

such bonds. At least 30 days before each annual meeting of the

commission, the authority shall submit to the department of taxation a

written statement regarding whether the authority is planning to propose to

issue any general obligation bonds before the next following annual

meeting of the commission.

Sec. 12. NRS 350.004 is hereby amended to read as follows:

350.004 1. Before any proposal to incur a general obligation debt or

levy a special elective tax may be submitted to the electors of a

municipality, before any issuance of general obligation bonds pursuant to

subsection 4 of NRS 350.020 , before entering into an installment

-purchase agreement with a term of more than 10 years or , before any

other formal action may be taken preliminary to the incurrence of any

general obligation debt, the proposed incurrence or levy must receive the

favorable vote of two-thirds of the members of the commission of each

county in which the municipality is situated.

2. Before the board of trustees of a district organized or reorganized

pursuant to chapter 318 of NRS whose population within its boundaries is

less than 5,000[,] incurs a medium-term obligation or otherwise borrows

money or issues securities to evidence such borrowing, other than

securities representing a general obligation debt[,] or installment

-purchase agreements with a term of 10 years or less, the proposed

borrowing or issuing of securities must receive the favorable vote of a

majority of the members of the commission of each county in which the

district is situated.

3. When any municipality other than a general improvement district

whose population within its boundaries is less than 5,000[,] issues any

special obligations, it shall so notify in its annual report the commission of

each county in which any of its territory is situated.

4. The commission shall not approve any proposal submitted to it

pursuant to this section by a municipality:

(a) Which, if the proposal is for the financing of a capital improvement,

is not included in its plan for capital improvement submitted pursuant to

NRS 350.0035, if such a plan is required to be submitted;

(b) If, based upon:

(1) Estimates of the amount of tax revenue from property taxes

needed for the special elective tax, or to repay the general obligation debt,

and the dates that revenue will be needed, as provided by the municipality;

(2) Estimates of the assessed valuation of the municipality for each of

the years in which tax revenue is needed, as provided by the municipality;

(3) The amount of any other required levies of property taxes, as

shown on the most recently filed final budgets of each entity authorized to

levy property taxes on any property within the municipality submitting the

proposal; and

(4) Any other factor the municipality discloses to the

commission,

the proposal would result in a combined property tax rate in any of the

overlapping entities within the county which exceeds the limit provided in

NRS 361.453, unless the proposal also includes an agreement which

complies with NRS 361.457 and which is approved by the governing

bodies of all affected municipalities within the area as to how the

combined property tax rates will be brought into compliance with the

statutory limitation or unless the commission adopts a plan that is

approved by the executive director of the department of taxation

pursuant to which the combined property tax rate will be in compliance

with the statutory limitation; or

inclusive, of paragraph (b), the proposal will affect the ability of an

affected governmental entity to levy the maximum amount of property

taxes that it may levy pursuant to NRS 354.59811, unless:

(1) The proposal includes a resolution approving the proposal

pursuant to subsection 3 of section 3 of Senate Bill No. 123 of this [act]

session from each affected governmental entity whose ability to levy

property taxes will be affected by the commission’s approval of the

proposal; or

(2) The commission has resolved all conflicts between the

municipality and all affected governmental entities and has approved the

increase in property taxes resulting from the proposal pursuant to section 3

of Senate Bill No. 123 of this [act.] session.

5. Except as otherwise provided in subsection 6, ifgeneral obligation

debt is to be incurred more than 36 months after the approval of that debt

by the commission, the governing body of the municipality shall obtain

[the] additional approval of the [executive director of the department of

taxation] commission before incurring the general obligation debt. The

[executive director] commission shall only approve [the] a proposal that is

submitted pursuant to this subsection if, based on the information set

forth in paragraph (b) of subsection 4 that is accurate as of the date on

which the governing body submits , pursuant to this subsection, its

request for approval to the [executive director:] commission:

(a) Incurrence of the general obligation debt will not result in a

combined property tax rate in any of the overlapping entities within the

county which exceeds the limit provided in NRS 361.453; [or]

(b) The proposal includes an agreement approved by the governing

bodies of all affected municipalities within the area as to how the

combined tax rates will be brought into compliance with the statutory

limitation[.] ; or

director of the department of taxation pursuant to which the

combined property tax rate will be in compliance with the statutory

limitation.

The approval of the [executive director] commission pursuant to this

subsection is effective for 18 months. The governing body of the

municipality may renew that approval for successive periods of 18 months

by filing an application for renewal with the [executive director.]

commission. Such an application must be accompanied by the information

set forth in paragraph (b) of subsection 4 that is accurate as of the date the

governing body files the application for renewal.

6. The executive director of the department of taxation may not

approve a proposal pursuant to subsection 5 which, based upon the factors

listed in subparagraphs (1) to (4), inclusive, of paragraph (b) of subsection

4, will affect the ability of an affected governmental entity to levy the

maximum amount of property taxes that it may levy pursuant to NRS

354.59811, unless:

(a) The proposal includes a resolution approving the proposal pursuant

to subsection 3 of section 3 of Senate Bill No. 123 of this [act] session

from each affected governmental entity whose ability to levy property

taxes will be affected by the commission’s approval of the proposal; or

(b) The commission has resolved all conflicts between the municipality

and all affected governmental entities and has approved the increase in

property taxes resulting from the proposal pursuant to section 3 of Senate

Bill No. 123 of this [act.] session.

7. [If the executive director does not approve a proposal submitted to

him pursuant to subsection 5, the governing body of the municipality may

appeal his decision to the Nevada tax commission.

8.] As used in this section, “affected governmental entity” has the

meaning ascribed to it in subsection 9 of section 3 of Senate Bill No. 123

of this [act.] session.

Sec. 13. NRS 350.005 is hereby amended to read as follows:

350.005 1. The governing body of the municipality proposing to

incur general obligation debt , to enter an installment-purchase

agreement with a term of more than 10 years or to levy a special elective

tax and the board of trustees of a general improvement district whose

population within its boundaries is less than 5,000[,] who proposes to

issue a medium-term obligation or otherwise borrow money and issue

any securities other than securities representing a general obligation debt

[,] or installment-purchase agreements with terms of 10 years or less,

shall notify the secretary of each appropriate commission, and shall submit

a statement of its proposal in sufficient number of copies for each member

of the commission. The secretary, with the approval of the chairman, shall,

within 10 days, give notice of a meeting, in the manner required by

chapter 241 of NRS, to be held not more than 20 days thereafter. He shall

provide a copy of the proposal to each member with the notice of the

meeting, and mail notice of the meeting to the chief financial officer of

each municipality in the county which has complied with subsection 1 of

NRS 350.0035 within the past year.

2. The commission may grant a conditional or provisional approval of

such proposal. Such conditions or provisions are limited to [the] :

(a) The scheduling of:

[(a)] (1) The issuance and retirement of securities, if the proposal is to

incur general obligation debt; or

[(b)] (2) The imposition of the tax, if the proposal is to levy a special

elective tax[.] ; and

(b) If the proposal would result in a combined property tax rate in any

of the overlapping entities within the county which exceeds 90 percent of

the limit provided in NRS 361.453, a condition requiring a reduction in

the amount of the proposed debt, installment-purchase agreement or

special elective tax.

3. If the proposal is from a municipality, the commission may not

approve any portion of the proposal that is not included in the statement

filed pursuant to paragraph (b) of subsection 1 of NRS 350.0035, as

updated pursuant to subsection 3 or 4 of NRS 350.0035.

4. The commission may adjourn a meeting called to consider a

particular proposal no more than once, for no more than 10 days.

Notification of the approval or disapproval of its proposal must be sent to

the governing body within 3 days after the meeting.

Sec. 14. NRS 350.0051 is hereby amended to read as follows:

350.0051 1. In determining whether to approve, conditionally or

provisionally approve, or disapprove a proposal to incur debt , to enter an

installment-purchase agreement with a term of more than 10 years or to

levy a special elective tax, the commission shall not, except as otherwise

provided in paragraph (d) and section 3 of Senate Bill No. 123 of this

[act,] session, initiate a determination as to whether the proposed debt ,

installment-purchase agreement or special elective tax is sought to

accomplish a public purpose or to satisfy a public need. The commission

shall consider, but is not limited to, the following criteria:

(a) If the proposal is to incur debt, the amount of debt outstanding on

the part of the municipality proposing to incur the debt.

(b) The effect of the tax levy required for debt service on the proposed

debt[,] or to repay an installment-purchase agreement with a term of

more than 10 years, or of the proposed levy of a special elective tax, upon

the ability of the municipality proposing to incur the general obligation

debt , enter the installment-purchase agreement or levy the special

elective tax and of other municipalities to raise revenue for operating

purposes.

-purchase agreements or levies of special elective taxes by the

municipality proposing to incur the debt , enter the installment-purchase

agreement or levy the special elective tax and other municipalities whose

tax-levying powers overlap, as shown by the county or regional master

plan, if any, and by other available information.

(d) If the information set forth in paragraph (b) of subsection 4 of NRS

350.004 indicates that the proposal would result in a combined property

tax rate in any of the overlapping entities within the county which exceeds

the specified percentage, pursuant to subsection 1 of section 2 of Senate

Bill No. 123 of this [act,] session, of the limit provided in NRS 361.453:

(1) The public need to be served by the proceeds from the proposed

debt or tax levy in accordance with the priorities established pursuant to

subsection 2 of section 2 of Senate Bill No. 123 of this [act;] session; and

(2) A comparison of that public need and other public needs that

appear on the statements of current and contemplated general obligation

debt and special elective taxes submitted pursuant to paragraphs (a) and (b)

of subsection 1 of NRS 350.0035 that may affect the combined property

tax rate in any of the overlapping entities within the county.

2. If the commission approves the proposal, the amount received from

the sale of the general obligation debt or from the special elective tax may

be expended only for the purposes described in the proposal.

3. The commission may make reasonable requests from a

municipality for information relating to the criteria described in

paragraphs (a) to (d), inclusive, of subsection 1. A municipality shall use

its best efforts to comply with information requests from the commission

in a timely manner.

Sec. 15. NRS 350.006 is hereby amended to read as follows:

350.006 The provisions of NRS 350.001 to 350.0052, inclusive, do not

apply to:

1. Any general obligation debt incurred or special elective tax levied

before July 1, 1995;

2. Any general obligation debt or special elective tax approved at an

election held before July 1, 1995, whether or not the debt is incurred or tax

is levied before that date;

3. Any general obligation debt authorized to be incurred, or special

elective tax authorized to be levied, by a special act adopted and approved

before July 1, 1995; [and]

4. Any debt incurred for the purpose of refunding any outstanding

general obligation debt[.] ; and

5. Any medium-term obligation, except a medium-term obligation

issued after July 1, 2001, by a general improvement district whose

population within its boundaries is less than 5,000.

Sec. 16. NRS 350.020 is hereby amended to read as follows:

350.020 1. Except as otherwise provided by subsections 3 and 4, if a

municipality proposes to issue or incur general obligations, the proposal

must be submitted to the electors of the municipality at a special election

called for that purpose or the next general municipal election or general

state election.

2. Such a special election may be held:

(a) At any time, including, without limitation, on the date of a primary

municipal election or a primary state election, if the governing body of the

municipality determines, by a unanimous vote, that an emergency exists;

(b) On the first Tuesday after the first Monday in June of an odd

-numbered year.

The determination made by the governing body is conclusive unless it is

shown that the governing body acted with fraud or a gross abuse of

discretion. An action to challenge the determination made by the

governing body must be commenced within 15 days after the governing

body’s determination is final. As used in this subsection, “emergency”

means any occurrence or combination of occurrences which requires

immediate action by the governing body of the municipality to prevent or

mitigate a substantial financial loss to the municipality or to enable the

governing body to provide an essential service to the residents of the

municipality.

3. If payment of a general obligation of the municipality is additionally

secured by a pledge of gross or net revenue of a project to be financed by

its issue, and the governing body determines, by an affirmative vote of

two-thirds of the members elected to the governing body, that the pledged

revenue will at least equal the amount required in each year for the

payment of interest and principal, without regard to any option reserved by

the municipality for early redemption, the municipality may, after a public

hearing, incur this general obligation without an election unless, within 60

days after publication of a resolution of intent to issue the bonds, a petition

is presented to the governing body signed by not less than 5 percent of the

registered voters of the municipality who together with any corporate

petitioners own not less than 2 percent in assessed value of the taxable

property of the municipality. Any member elected to the governing body

whose authority to vote is limited by charter, statute or otherwise may vote

on the determination required to be made by the governing body pursuant

to this subsection. The determination by the governing body becomes

conclusive on the last day for filing the petition. For the purpose of this

subsection, the number of registered voters must be determined as of the

close of registration for the last preceding general election and assessed

values must be determined from the next preceding final assessment roll.

An authorized corporate officer may sign such a petition whether or not he

is a registered voter. The resolution of intent need not be published in full,

but the publication must include the amount of the obligation and the

purpose for which it is to be incurred. Notice of the public hearing must be

published at least 10 days before the day of the hearing. The publications

must be made once in a newspaper of general circulation in the

municipality. When published, the notice of the public hearing must be at

least as large as 5 inches high by 4 inches wide.

4. The board of trustees of a school district may issue general

obligation bonds which are not expected to result in an increase in the

existing property tax levy for the payment of bonds of the school district

without holding an election for each issuance of the bonds if the qualified

electors approve a question submitted by the board of trustees that

authorizes issuance of bonds for a period of 10 years after the date of

approval by the voters. If the question is approved, the board of trustees of

the school district may issue the bonds for a period of 10 years after the

date of approval by the voters, after obtaining the approval of the debt

management commission in the county in which the school district is

located and, in a county whose population is 100,000 or more, the

approval of the oversight panel for school facilities established pursuant to

NRS 393.092 in that county, if the board of trustees of the school district

finds that the existing tax for debt service will at least equal the amount

required to pay the principal and interest on the outstanding general

obligations of the school district and the general obligations proposed to

be issued. The finding made by the board of trustees is conclusive in the

absence of fraud or gross abuse of discretion. As used in this subsection,

“general obligations” does not include medium-term obligations issued

pursuant to NRS [350.085] 350.087 to 350.095, inclusive.

5. At the time of issuance of bonds authorized pursuant to subsection

4, the board of trustees shall establish a reserve account in its debt service

fund for payment of the outstanding bonds of the school district. The

reserve account must be established and maintained in an amount at least

equal to the lesser of the amount of principal and interest payments due on

all of the outstanding bonds of the school district in the next fiscal year or

10 percent of the outstanding principal amount of the outstanding bonds of

the school district. If the amount in the reserve account falls below the

amount required by this subsection:

(a) The board of trustees shall not issue additional bonds pursuant to

subsection 4 until the reserve account is restored to the level required by

this subsection; and

(b) The board of trustees shall apply all of the taxes levied by the school

district for payment of bonds of the school district that are not needed for

payment of the principal and interest on bonds of the school district in the

current fiscal year to restore the reserve account to the level required

pursuant to this subsection.

6. A municipality may issue special or medium-term obligations

without an election.

Sec. 17. NRS 350.087 is hereby amended to read as follows:

350.087 1. If the public interest requires a medium-term obligation

[,] or installment-purchase agreement, the governing body of any local

government, by a resolution adopted by two-thirds of its members, may

authorize a medium-term obligation[.] or installment-purchase

agreement. For the purposes of the issuance of a medium-term obligation

pursuant to NRS 280.266, a metropolitan police committee on fiscal

affairs shall be deemed the governing body of a local government.

2. The resolution must contain:

(a) A finding by the governing body that the public interest requires the

medium-term obligation[;] or installment-purchase agreement;

(b) A statement of the facts upon which the finding required pursuant to

paragraph (a) is based; [and]

(1) Each source of revenue of the local government that is anticipated

to be used to repay the medium-term obligation[;] or installment

-purchase agreement; and

(2) The dollar amount that is anticipated to be available to repay the

medium-term obligation or installment-purchase agreement from each

such source[.] ; and

(d) If the resolution is for an installment-purchase agreement with a

term of more than 10 years:

(1) A statement comparing the cost of installment-purchase

financing with other available methods of financing, including, without

limitation, financing with general obligation bonds or revenue bonds;

and

(2) If such statement concludes that installment-purchase financing

is more expensive than other available methods of financing, a

statement explaining the reasons for choosing installment-purchase

financing instead of a less expensive alternative.

3. Except as otherwise provided in subsection 4, before the adoption of

any such resolution, the governing body shall publish notice of its

intention to act thereon in a newspaper of general circulation for at least

one publication. No vote may be taken upon the resolution until 10 days

after

the publication of the notice. The cost of publication of the notice required

of an entity is a proper charge against its general fund.

4. If such a resolution will be adopted by a metropolitan police

committee on fiscal affairs, the sheriff of the county in which the

metropolitan police department is located shall publish the notice required

pursuant to subsection 3.

Sec. 18. NRS 350.089 is hereby amended to read as follows:

350.089 Except as otherwise provided in NRS 280.266 and 496.155:

1. Upon the adoption by a local government of a resolution for a

medium-term obligation[,] or installment-purchase agreement, as

provided in NRS 350.087, [by a local government,] a certified copy

thereof must be forwarded to the executive director of the department of

taxation. As soon as is practicable, the executive director of the

department of taxation shall, after consideration of the tax structure of the

local government concerned, the probable ability of the local government

to repay the requested medium-term obligation or installment-purchase

agreement and the compliance of the local government with the applicable

provisions of law, including, without limitation, the provisions of chapter

354 of NRS, approve or disapprove the resolution in writing to the

governing board. No such resolution is effective until approved by the

executive director of the department of taxation. The written approval of

the executive director of the department of taxation must be recorded in

the minutes of the governing board.

2. If the executive director of the department of taxation does not

approve the resolution for the medium-term obligation[,] or installment

-purchase agreement, the governing board of the local government may

appeal the executive director’s decision to the Nevada tax commission.

Sec. 19. NRS 350.091 is hereby amended to read as follows:

350.091 1. Whenever the governing body of any local government is

authorized to enter into a medium-term obligation or installment

-purchase agreement as provided in NRS 280.266 or 350.089[, the

governing body:

(a) If the medium-term obligation] that is intended to finance a capital

project, the governing body shall update its plan for capital improvement

in the same manner as is required for general obligation debt pursuant to

NRS 350.0035.

[(b) May]

2. Whenever the governing body of any local government is

authorized to enter into a medium-term obligation as provided in NRS

350.089, the governing body may issue, as evidence thereof, negotiable

notes[, leases, other evidence of a transaction described in NRS 350.800,

or short-time] or medium-term negotiable bonds[.

2. Except] that, except as otherwise provided in subsection 5 of NRS

496.155 : [, the negotiable notes or bonds:]

(a) Must mature not later than 10 years after the date of issuance ; [.]

(b) Must bear interest at a rate or rates which do not exceed by more

than 3 percent the Index of Twenty Bonds which was most recently

published before the bids are received or a negotiated offer is accepted[.] ;

and

which allows redemption of the notes or bonds before maturity, upon such

terms as the governing body determines.

3. Whenever the governing body of any local government is

authorized to enter into an installment-purchase agreement as provided

in NRS 280.266 or 350.089, the governing body may issue, as evidence

thereof, an installment-purchase agreement, lease or other evidence of a

transaction described in NRS 350.800. An installment-purchase

agreement, lease or other evidence of a transaction described in NRS

350.800 issued pursuant to this subsection:

(a) Must have a term that is 30 years or less;

(b) Must bear interest at a rate or rates that do not exceed by more

than 3 percent the Index of Revenue Bonds which was most recently

published before the local government enters into the installment

-purchase agreement; and

that allows prepayment of the purchase price upon such terms as are

provided in the agreement.

4. If the [maximum term of the financing is more than 5 years, the]

term of the medium-term obligation or installment-purchase agreement

is more than 5 years, the weighted average term of the medium-term

obligation or installment-purchase agreement may not exceed the

estimated weighted average useful life of the [asset to be purchased with

the proceeds from the financing.] assets being financed with the medium

-term obligation or installment-purchase agreement.

5. For the purposes of subsection 4, the committee on local

government finance may adopt regulations that provide guidelines for

the useful life of various types of assets and for calculation of the

weighted average useful life of assets.

Sec. 20. NRS 350.093 is hereby amended to read as follows:

350.093 1. After a medium-term obligation has been authorized as

provided in NRS 350.089 and if, in the judgment of the governing board

of the local government, the fiscal affairs of the local government can be

carried on without impairment and there is sufficient money in the general

fund or a surplus in any other fund, with the exception of the bond interest

and redemption fund, of the local government, the governing board may

transfer from the general fund or from the surplus appearing in any fund,

with the exception of the bond interest and redemption fund, money

sufficient to meet the purpose of the medium-term obligation.

2. When such a transfer is made, the governing board of the local

government shall comply with the provisions of NRS 350.095, and when

the special tax is thereafter collected, the amount so collected must be

placed immediately in the fund from which the loan was made.

3. In cases where the fund from which the loan was made, at the time

of the transfer of funds therefrom, contains a surplus that in the judgment

of the executive director of the department of taxation is or will not be

needed for the purposes of the fund in the ordinary course of events, the

special tax need not be levied, collected and placed in the fund from which

the loan was made, but the transfer shall be deemed refunded for all

purposes of NRS [350.085] 350.087 to 350.095, inclusive.

Sec. 21. NRS 350.115 is hereby amended to read as follows:

350.115 “Bond” means any evidence of [indebtedness of] borrowing

by a municipality that is issued pursuant to the provisions of this chapter or

chapter 244, 244A, 268, 269, 271, 318[, 354] or 387 of NRS, whether

general or special obligations, including, without limitation, bonds, notes,

debentures, warrants and certificates.

Sec. 22. NRS 350.800 is hereby amended to read as follows:

350.800 1. A transaction whereby a municipality acquires real or

personal property and another person acquires or retains a security interest

in that or other property creates a general obligation of the municipality

which must be counted against any limit upon its debt unless:

(a) The obligation by its terms is extinguished by failure of the

governing body to appropriate money for the ensuing fiscal year for

payment of the amounts then due; or

(b) The budget of the municipality for the fiscal year in which the

transaction occurs includes a provision for the discharge of the obligation

in full.

2. Any member of the governing body may vote upon such a

transaction whether or not the obligation incurred is expected to extend

beyond his term of office, without any special notice or other formality.

3. Any such transaction is subject to the requirements of this chapter

for an election if it must be counted against a debt limit, but , except as

otherwise provided in NRS 350.001 to 350.006, inclusive, and 350.087 to

350.095, inclusive, is not subject to any other requirement of this chapter.

4. In addition to or as a substitute for granting a security interest in the

property being acquired in a transaction described in subsection 1, the

municipality may grant a security interest in other property if the

governing body finds that:

(a) Granting the security interest in the other property will result in

lower financing costs to the municipality; and

(b) The value of all property in which a security interest is granted does

not, at the time the security interest is granted, exceed an amount equal

to one and one-half times the value of the property being

acquired.

The finding and determination of values by the governing body are

conclusive in the absence of fraud or gross abuse of discretion.

Sec. 23. NRS 104.9109 is hereby amended to read as follows:

104.9109 1. Except as otherwise provided in subsections 3 and 4,

this article applies to:

(a) A transaction, regardless of its form, that creates a security interest

in personal property or fixtures by contract;

(b) An agricultural lien;

notes;

(d) A consignment;

(e) A security interest arising under NRS 104.2401, 104.2505,

subsection 3 of NRS 104.2711 or subsection 5 of NRS 104A.2508, as

provided in NRS 104.9110; and

(f) A security interest arising under NRS 104.4210 or 104.5118.

2. The application of this article to a security interest in a secured

obligation is not affected by the fact that the obligation is itself secured by

a transaction or interest to which this article does not apply.

3. This article does not apply to the extent that:

(a) A statute, regulation or treaty of the United States preempts this

article; or

(b) The rights of a transferee beneficiary or nominated person under a

letter of credit are independent and superior under NRS 104.5114.

4. This article does not apply to:

(a) A landlord’s lien, other than an agricultural lien;

(b) A lien, other than an agricultural lien, given by statute or other rule

of law for services or materials, but NRS 104.9333 applies with respect to

priority of the lien;

an employee;

(d) A sale of accounts, chattel paper, payment intangibles or promissory

notes as part of a sale of the business out of which they arose;

(e) An assignment of accounts, chattel paper, payment intangibles or

promissory notes which is for the purpose of collection only;

(f) An assignment of a right to payment under a contract to an assignee

that is also obligated to perform under the contract;

(g) An assignment of a single account, payment intangible or

promissory note to an assignee in full or partial satisfaction of a

preexisting indebtedness;

(h) A transfer of an interest in or an assignment of a claim under a

policy of insurance, other than an assignment by or to a health-care

provider of a health-care-insurance receivable and any subsequent

assignment of the right to payment, but NRS 104.9315 and 104.9322

apply with respect to proceeds and priorities in proceeds;

(i) An assignment of a right represented by a judgment, other than a

judgment taken on a right to payment that was collateral;

(j) A right of recoupment or set-off, but:

(1) NRS 104.9340 applies with respect to the effectiveness of rights

of recoupment or set-off against deposit accounts; and

(2) NRS 104.9404 applies with respect to defenses or claims of an

account debtor;

(k) The creation or transfer of an interest in or lien on real property,

including a lease or rents thereunder, except to the extent that provision is

made for:

(1) Liens on real property in NRS 104.9203 and 104.9308;

(2) Fixtures in NRS 104.9334;

(3) Fixture filings in NRS 104.9501, 104.9502, 104.9512, 104.9516

and 104.9519; and

(4) Security agreements covering personal and real property in NRS

104.9604;

(l) An assignment of a claim arising in tort, other than a commercial tort

claim, but NRS 104.9315 and 104.9322 apply with respect to proceeds and

priorities in proceeds;

(m) An assignment of a deposit account in a consumer transaction, but

NRS 104.9315 and 104.9322 apply with respect to proceeds and priorities

in proceeds; or

(n) A transfer by a government or governmental unit.

Sec. 24. NRS 233B.062 is hereby amended to read as follows:

233B.062 1. It is the policy of this state that every regulation of an

agency be made easily accessible to the public and expressed in clear and

concise language. To assist in carrying out this policy:

(a) The attorney general must develop guidelines for drafting

regulations; and

(b) Every permanent regulation must be incorporated, excluding any

forms used by the agency, any publication adopted by reference, the title,

any signature and other formal parts, in the Nevada Administrative Code,

and every emergency or temporary regulation must be distributed in the

same manner as the Nevada Administrative Code.

2. The legislative counsel shall treat regulations adopted by entities

other than agencies, in the same manner as regulations adopted by

agencies if the entity is required by statute to adopt the regulation in the

manner prescribed by this chapter.

3. The legislative commission may authorize inclusion in the Nevada

Administrative Code of the regulations of an agency otherwise exempted

from the requirements of this chapter.

Sec. 25-27. (Deleted by amendment.)

Sec. 28. NRS 244.3661 is hereby amended to read as follows:

244.3661 1. Except as otherwise provided in NRS 704.664, a board

of county commissioners may, by ordinance, impose an excise tax on the

use of water in an amount sufficient to ensure the payment, wholly or in

part, of obligations incurred by the county to acquire and construct a new

facility for the treatment of water for public or private use, or both. The

tax must be imposed on customers of suppliers of water that are capable of

using the water treatment services provided by the facility to be financed

with the proceeds of the tax.

2. An excise tax imposed pursuant to subsection 1 may be levied at

different rates for different classes of customers or to take into account

differences in the amount of water used or estimated to be used or the size

of the connection.

3. The ordinance imposing the tax must provide the:

(a) Rate or rates of the tax;

(b) Procedure for collection of the tax;

(d) Rate of interest that will be charged on late payments.

4. Late payments of the tax must bear interest at a rate not exceeding 2

percent per month, or fraction thereof. The tax due is a perpetual lien

against the property served by the water on whose use the tax is imposed

until the tax and any interest which may accrue thereon are paid. The

county shall enforce the lien in the same manner as provided in NRS

[361.565] 361.5648 to 361.730, inclusive, for property taxes.

5. A county may:

(a) Acquire and construct a new facility for the treatment of water for

public or private use, or both.

(b) Finance the project by the issuance of general obligation bonds,

medium-term obligations or revenue bonds or other securities issued

pursuant to chapter 350 of NRS, or by [installment purchase] installment

-purchase financing pursuant to [NRS 350.800.] that chapter.

(1) Water treatment services provided by the facility will be made

available to the public utility; or

(2) The public utility will operate and maintain the facility,

or both. An agreement entered into pursuant to this paragraph may extend

beyond the terms of office of the members of the board of county

commissioners who voted upon it.

6. A county may pledge any money received from the proceeds of a

tax imposed pursuant to this section for the payment of general or special

obligations issued for a new facility for the treatment of water for public or

private use, or both. Any money pledged by the county pursuant to this

subsection may be treated as pledged revenues of the project for the

purposes of subsection 3 of NRS 350.020.

7. As used in this section, “public utility” has the meaning ascribed to

it in NRS 704.020 and does not include the persons excluded by NRS

704.030.

Sec. 29. NRS 280.266 is hereby amended to read as follows:

280.266 1. Upon the adoption of a resolution pursuant to NRS

350.087, the committee may issue a medium-term obligation to purchase

capital equipment or enter into a lease-purchase agreement for capital

equipment.

2. The committee is not required to comply with the provisions of

NRS 350.089 if it [issues a medium-term obligation for] enters a lease

-purchase agreement for capital equipment.

Sec. 30. Chapter 354 of NRS is hereby amended by adding thereto the

provisions set forth as sections 31 and 32 of this act.

Sec. 31. 1. The committee on local government finance may adopt

such regulations as are necessary for the administration of this chapter.

2. Any regulations adopted by the committee on local government

finance must be adopted in the manner prescribed for state agencies in

chapter 233B of NRS.

Sec. 32. The proceeds from any obligation issued by a local

government that has a term which is more than 1 year must not be used

to pay operating expenses, except that:

1. The proceeds of any obligation issued to construct or acquire a

facility may be used to pay operating expenses for the period provided in

subsection 7 of NRS 350.516.

2. The proceeds of a medium-term obligation issued by a local

government with respect to which the Nevada tax commission has

determined that a financial emergency exists pursuant to NRS 354.685

may be used to pay operating expenses with the approval of the executive

director of the department of taxation.

Sec. 33. NRS 354.475 is hereby amended to read as follows:

354.475 1. All special districts subject to the provisions of the Local

Government Budget Act with annual total expenditures of less than

$100,000 may petition the department of taxation for exemption from the

requirements of the Local Government Budget Act for the filing of certain

budget documents and audit reports. Such districts may further petition to

return to a cash method of accounting. The minimum required of such

districts is the filing with the department of taxation of an annual budget

on or before April 15 of each year and the filing of quarterly reports in

accordance with NRS 354.602. Such petitions must be received by the

department of taxation before December 31 to be effective for the

succeeding fiscal year or, in a case of an annual audit exemption, to be

effective for the current fiscal year. A board of county commissioners may

request the department of taxation to audit the financial records of such an

exempt district.

2. Such districts are exempt from all publication requirements of the

Local Government Budget Act, except that the department of taxation by

regulation shall require an annual publication of a notice of budget

adoption and filing. The [department of taxation] committee on local

government finance shall adopt regulations pursuant to NRS 354.594

which are necessary to carry out the purposes of this section.

3. The revenue recorded in accounts that are kept on a cash basis must

consist of cash items.

4. As used in this section, “cash basis” means the system of accounting

under which revenues are recorded only when received and expenditures

or expenses are recorded only when paid.

Sec. 34. NRS 354.535 is hereby amended to read as follows:

354.535 “General long-term debt” means debt which is legally payable

from general revenues and is backed by the full faith and credit of a

governmental unit. The term includes debt represented by local

government securities issued pursuant to chapter 350 of NRS and debt

created for medium-term obligations pursuant to NRS [350.085] 350.087

to 350.095, inclusive.

Sec. 35. NRS 354.594 is hereby amended to read as follows:

354.594 The [department of taxation] committee on local government

finance shall determine and advise local government officers of

regulations, procedures and report forms for compliance with NRS

354.470 to 354.626, inclusive. [It shall make such determinations after

hearing the advice and recommendations of the committee on local

government finance.]

Sec. 36. NRS 354.598 is hereby amended to read as follows:

354.598 1. At the time and place advertised for public hearing, or at

any time and place to which the public hearing is from time to time

adjourned, the governing body shall hold a public hearing on the tentative

budget, at which time interested persons must be given an opportunity to

be heard.

2. At the public hearing, the governing body shall indicate changes, if

any, to be made in the tentative budget, and shall adopt a final budget by

the favorable votes of a majority of all members of the governing body.

Except as otherwise provided in this subsection, the final budget must be

adopted on or before June 1 of each year. The final budgets of school

districts must be adopted on or before June 8 of each year and must be

accompanied by copies of the written report and written procedure

prepared pursuant to subsection 3 of NRS 385.351. Should the governing

body fail to adopt a final budget that complies with the requirements of law

and the regulations of the [department of taxation] committee on local

government finance on or before the required date, the budget adopted

and approved by the department of taxation for the current year, adjusted

as to content and rate in such a manner as the department of taxation may

consider necessary, automatically becomes the budget for the ensuing

fiscal year. When a budget has been so adopted by default, the governing

body may not reconsider the budget without the express approval of the

department of taxation. If the default budget creates a combined ad

valorem tax rate in excess of the limit imposed by NRS 361.453, the

Nevada tax commission shall adjust the budget as provided in NRS

361.4547 or 361.455.

3. The final budget must be certified by a majority of all members of

the governing body and a copy of it, together with an affidavit of proof of

publication of the notice of the public hearing, must be transmitted to the

Nevada tax commission. If a tentative budget is adopted by default as

provided in subsection 2, the clerk of the governing body shall certify the

budget and transmit to the Nevada tax commission a copy of the budget,

together with an affidavit of proof of the notice of the public hearing, if

that notice was published. Certified copies of the final budget must be

distributed as determined by the department of taxation.

4. Upon the adoption of the final budget or the amendment of the

budget in accordance with NRS 354.606, the several amounts stated in it

as proposed expenditures are appropriated for the purposes indicated in the

budget.

5. No governing body may adopt any budget which appropriates for

any fund any amount in excess of the budget resources of that fund.

6. On or before January 1 of each school year, each school district

shall adopt an amendment to its final budget after the count of pupils is

completed pursuant to subsection 1 of NRS 387.1233. The amendment

must reflect any adjustments necessary as a result of the completed count

of pupils.

Sec. 37. NRS 354.59811 is hereby amended to read as follows:

354.59811 1. Except as otherwise provided in NRS 354.59813,

354.59815, 354.5982, 354.5987, 354.59871, 354.705, 354.723, 450.425,

450.760, 540A.265 and 543.600, and section 4 of Senate Bill No. 203 of

this [act,] session, for each fiscal year beginning on or after July 1, 1989,

the maximum amount of money that a local government, except a school

district, a district to provide a telephone number for emergencies[,] or a

redevelopment agency, may receive from taxes ad valorem, other than

those attributable to the net proceeds of minerals or those levied for the

payment of bonded indebtedness and interest thereon incurred as general

long-term debt of the issuer, or for the payment of obligations issued to

pay the cost of a water project pursuant to NRS 349.950, or for the

payment of obligations under a capital lease executed before April 30,

1981, must be calculated as follows:

(a) The rate must be set so that when applied to the current fiscal year’s

assessed valuation of all property which was on the preceding fiscal year’s

assessment roll, together with the assessed valuation of property on the

central assessment roll which was allocated to the local government, but

excluding any assessed valuation attributable to the net proceeds of

minerals, assessed valuation attributable to a redevelopment area and

assessed valuation of a fire protection district attributable to real property

which is transferred from private ownership to public ownership for the

purpose of conservation, it will produce 106 percent of the maximum

revenue allowable from taxes ad valorem for the preceding fiscal year,

except that the rate so determined must not be less than the rate allowed

for the previous fiscal year, except for any decrease attributable to the

imposition of a tax pursuant to NRS 354.59813 in the previous year.

(b) This rate must then be applied to the total assessed valuation,

excluding the assessed valuation attributable to the net proceeds of

minerals and the assessed valuation of a fire protection district attributable

to real property which is transferred from private ownership to public

ownership for the purpose of conservation , but including new real

property, possessory interests and mobile homes, for the current fiscal year

to determine the allowed revenue from taxes ad valorem for the local

government.

2. As used in this section, “general long-term debt” does not include

debt created for medium-term obligations pursuant to NRS [350.085]

350.087 to 350.095, inclusive.

Sec. 38. NRS 354.59817 is hereby amended to read as follows:

354.59817 1. In addition to the allowed revenue from taxes ad

valorem determined pursuant to NRS 354.59811, upon the approval of a

majority of the registered voters of a county voting upon the question, the

board of county commissioners may levy a tax ad valorem on all taxable

property in the county at a rate not to exceed 15 cents per $100 of the

assessed valuation of the county. A tax must not be levied pursuant to this

section for more than 10 years.

2. The board of county commissioners shall direct the county treasurer

to distribute quarterly the proceeds of any tax levied pursuant to the

provisions of this section among the county and the cities and towns

within that county in the proportion that the supplemental city-county

relief tax distribution factor of each of those local governments for the

1990-1991 fiscal year bears to the sum of the supplemental city-county

relief tax distribution factors of all of the local governments in the county

for the 1990-1991 fiscal year.

3. The board of county commissioners shall not reduce the rate of any

tax levied pursuant to the provisions of this section without the approval of

each of the local governments that receives a portion of the tax, except

that, if a local government declines to receive its portion of the tax in a

particular year the levy may be reduced by the amount that local

government would have received.

4. The governing body of each local government that receives a

portion of the revenue from the tax levied pursuant to this section shall

establish a separate fund for capital projects for the purposes set forth in

this section. All interest and income earned on the money in the fund must

also be deposited in the fund. The money in the fund may only be used

for:

(a) The purchase of capital assets including land, improvements to land

and major items of equipment;

(b) The construction or replacement of public works; and

normal recurring maintenance.

The money in the fund must not be used to finance the issuance or the

repayment of bonds or other obligations, including medium-term

obligations[.] and installment-purchase agreements.

5. Money may be retained in the fund for not more than 10 years to

allow the funding of projects without the issuance of bonds or other

obligations. For the purpose of determining the length of time a deposit of

money has been retained in the fund, all money withdrawn from the fund

shall be deemed to be taken on a first-in, first-out basis. No money in the

fund at the end of the fiscal year may revert to any other fund, nor may the

money be a surplus for any other purpose than those specified in this

section.

6. The annual budget and audit report of each local government must

specifically identify this fund and must indicate in detail the projects that

have been funded with money from the fund. Any planned accumulation

of the money in the fund must also be specifically identified.

7. The projects on which money raised pursuant to this section will be

expended must be approved by the voters in the question submitted

pursuant to subsection 1 or in a separate question submitted on the ballot

at a [primary,] general or special election.

Sec. 39. NRS 354.59891 is hereby amended to read as follows:

354.59891 1. As used in this section:

(a) “Building permit” means the official document or certificate issued

by the building officer of a local government which authorizes the

construction of a structure.

(b) “Building permit basis” means the combination of the rate and the

valuation method used to calculate the total building permit fee.

the issuance of a building permit, including without limitation, all permit

fees and inspection fees. The term does not include, without limitation,

fees relating to water, sewer or other utilities, residential construction tax,

tax for the improvement of transportation imposed pursuant to NRS

278.710, any fee imposed pursuant to NRS 244.386 or any amount

expended to change the zoning of the property.

(d) “Current asset” means any cash maintained in an enterprise fund and

any interest or other income earned on the money in the enterprise fund

that, at the end of the current fiscal year, is anticipated by a local

government to be consumed or converted into cash during the next

ensuing fiscal year.

(e) “Current liability” means any debt incurred by a local government to

provide the services associated with issuing building permits that, at the

end of the current fiscal year, is determined by the local government to

require payment within the next ensuing fiscal year.

(f) “Operating cost” means the amount paid by a local government for

supplies, services, salaries, wages and employee benefits to provide the

services associated with issuing building permits.

(g) “Working capital” means the excess of current assets over current

liabilities, as determined by the local government at the end of the current

fiscal year.

2. Except as otherwise provided in subsections 3 and 4, a local

government shall not increase its building permit basis by more than an

amount equal to the building permit basis on June 30, 1989, multiplied by

a percentage equal to the percentage increase in the consumer price index

from January 1, 1988, to the January 1 next preceding the fiscal year for

which the calculation is made.

3. A local government may submit an application to increase its

building permit basis by an amount greater than otherwise allowable

pursuant to subsection 2 to the Nevada tax commission. The Nevada tax

commission may allow the increase only if it finds that:

(a) Emergency conditions exist which impair the ability of the local

government to perform the basic functions for which it was created; or

(b) The building permit basis of the local government is substantially

below that of other local governments in the state and the cost of providing

the services associated with the issuance of building permits in the

previous fiscal year exceeded the total revenue received from building

permit fees, excluding any amount of residential construction tax

collected, for that fiscal year.

4. Upon application by a local government, the Nevada tax

commission shall exempt the local government from the limitation on the

increase of its building permit basis if:

(a) The local government creates an enterprise fund exclusively for

building permit fees;

(b) Any interest or other income earned on the money in the enterprise

fund is credited to the fund;

maintains a balance of unreserved working capital in the enterprise fund

that does not exceed an amount equal to 9 months’ operating costs for the

program for the issuance of building permits of the local government; and

(d) The local government does not use any of the money in the

enterprise fund for any purpose other than the actual direct and indirect

costs of the program for the issuance of building permits, including

without limitation, the cost of checking plans, issuing permits, inspecting

buildings and administering the program. The [executive director of the

department of taxation] committee on local government finance shall

adopt regulations governing the permissible expenditures from an

enterprise fund pursuant to this paragraph.

5. In addition to the balance of unreserved working capital authorized

pursuant to subsection 4, the local government may maintain in an

enterprise fund created pursuant to this section an amount of working

capital for the following purposes:

(a) An amount sufficient to pay the debt service for 1 year on any debt

incurred by the local government to provide the services associated with

issuing building permits;

(b) An amount that does not exceed the total amount of expenditures for

the program for the issuance of building permits of the local government

set forth in the capital improvement plan of the local government prepared

pursuant to NRS 354.5945 for the current fiscal year; and

costs of the program for the issuance of building permits of the local

government which must be used to pay for unanticipated capital

replacement.

6. Any amount in an enterprise fund created pursuant to this section

that is designated for special use, including, without limitation, prepaid

fees and any other amount subject to a contractual agreement, must be

identified as a restricted asset and must not be included as a current asset

in the calculation of working capital.

7. If a balance in excess of the amount authorized pursuant to

subsections 4 and 5 is maintained in an enterprise fund created pursuant to

this section at the close of 2 consecutive fiscal years, the local government

shall reduce the building permit fees it charges by an amount that is

sufficient to ensure that the balance in the enterprise fund at the close of

the fiscal year next following those 2 consecutive fiscal years does not

exceed the amount authorized pursuant to subsections 4 and 5.

Sec. 40. NRS 354.6105 is hereby amended to read as follows:

354.6105 1. A local government [in a county whose population is

100,000 or more shall] may establish a fund for the extraordinary

maintenance, repair or improvement of capital projects. [The local

government shall establish within that fund a separate account for each

capital project it undertakes, except a capital project for the:

(a) Construction of public roads;

(b) Control of floods; or

The local government shall allocate an amount equal to one-half of 1

percent of the total amount of the bonds sold for each capital project and

deposit that amount in the separate account established for that capital

project. The proceeds from the sale of those bonds or any other money of

the local government may be used to carry out the provisions of this

subsection.]

2. Any interest and income earned on the money in [an account within]

the fund in excess of any amount which is reserved for rebate payments to

the Federal Government pursuant to 26 U.S.C. § 148, as amended, or is

otherwise required to be applied in a specific manner by the Internal

Revenue Code of 1986, as amended, must be credited to [that account.

3. The] the fund.

3. Except as otherwise provided in NRS 374A.020, the money in

[each account within] the fund may be used only for the extraordinary

maintenance, repair or improvement of [the capital project or a facility

which replaces that capital project.] capital projects or facilities that

replace capital projects of the entity that made the deposits in the fund.

The money in [each account within] the fund at the end of the fiscal year

may not revert to any other fund or be a surplus for any purpose other than

the purpose specified in this subsection. [If the local government sells any

capital project for which an account within the fund was established, any

balance remaining in that account must be used to reduce the debt of the

local government.

4. The annual budget and audit report of the local government

prepared pursuant to NRS 354.624 must specifically identify:

(a) Each fund and every account within that fund established pursuant

to this section and indicate in detail any extraordinary maintenance, repairs

or improvements of the capital project that have been paid for with money

from the fund; and

(b) Any planned accumulation of money in each fund and every account

within the fund.

The audit report must include a statement by the auditor whether the local

government has complied with the provisions of this subsection.]

4. As used in this section, “extraordinary maintenance, repair or

improvement” means all expenses ordinarily incurred not more than

once every 5 years to maintain a local governmental facility or capital

project in a fit operating condition.

Sec. 41. NRS 354.6116 is hereby amended to read as follows:

354.6116 A local government, except a school district, that receives

revenue from taxes ad valorem from a lessee or user of property which is

taxable pursuant to NRS 361.157 or 361.159 shall deposit the revenue in

or transfer the revenue to one or more of the funds established by the local

government pursuant to NRS [354.611,] 354.6113 or 354.6115 and use

that revenue only for the purposes authorized by those sections if the

revenue was received in:

1. A fiscal year after the fiscal year the taxes were owed; or

2. The fiscal year the taxes are owed and the taxes were excluded from

the estimate of revenue from taxes ad valorem for the local government

pursuant to NRS 354.597.

Sec. 42. NRS 354.6117 is hereby amended to read as follows:

354.6117 1. Except as otherwise provided in subsection 2, the total

amount of money which may be transferred in a fiscal year from the

general fund of a local government to the funds established pursuant to

NRS [354.611,] 354.6113 and 354.6115 must not exceed 10 percent of the

total amount of the budgeted expenditures of the general fund, plus any

money transferred from the general fund, other than the money transferred

to those funds, for that fiscal year.

2. Any money that a local government, pursuant to NRS 354.6116,

deposits in or transfers to one or more of the funds established by the local

government pursuant to NRS [354.611,] 354.6113 or 354.6115:

(a) Is not subject to the limitation on the amount of money that a local

government may transfer to those funds pursuant to subsection 1.

(b) Must not be included in the determination of the total amount of

money transferred to those funds for the purposes of the limitation set

forth in subsection 1.

Sec. 43. NRS 354.626 is hereby amended to read as follows:

354.626 1. No governing body or member thereof, officer, office,

department or agency may, during any fiscal year, expend or contract to

expend any money or incur any liability, or enter into any contract which

by its terms involves the expenditure of money, in excess of the amounts

appropriated for that function, other than bond repayments, medium-term

obligation repayments, and any other long-term contract expressly

authorized by law. Any officer or employee of a local government who

willfully violates NRS 354.470 to 354.626, inclusive, is guilty of a

misdemeanor, and upon conviction thereof ceases to hold his office or

employment. Prosecution for any violation of this section may be

conducted by the attorney general, or, in the case of incorporated cities,

school districts or special districts, by the district attorney.

2. Without limiting the generality of the exceptions contained in

subsection 1, the provisions of this section specifically do not apply to:

(a) Purchase of comprehensive general liability policies of insurance

which require an audit at the end of the term thereof.

(b) Long-term cooperative agreements as authorized by chapter 277 of

NRS.

authorized by NRS 278.010 to 278.630, inclusive.

(d) Long-term contracts for the purchase of utility service such as, but

not limited to, heat, light, sewerage, power, water and telephone service.

(e) Contracts between a local government and an employee covering

professional services to be performed within 24 months following the date

of such contract or contracts entered into between local government

employers and employee organizations.

(f) Contracts between a local government and any person for the

construction or completion of public works, money for which has been or

will be provided by the proceeds of a sale of bonds , [or] medium-term

obligations or an installment-purchase agreement and that are entered

into by the local government after:

(1) Any election required for the approval of the bonds or

installment-purchase agreement has been held;

(2) Any approvals by any other governmental entity required to be

obtained before the bonds , [or] medium-term obligations or installment

-purchase agreement can be issued have been obtained; and

(3) The ordinance or resolution that specifies each of the terms of the

bonds , [or] medium-term obligations[,] or installment-purchase

agreement, except those terms that are set forth in paragraphs (a) to (e),

inclusive, of subsection 2 of NRS 350.165, has been adopted.

Neither the fund balance of a governmental fund nor the equity balance in

any proprietary fund may be used unless appropriated in a manner

provided by law.

(g) Contracts which are entered into by a local government and

delivered to any person solely for the purpose of acquiring supplies and

equipment necessarily ordered in the current fiscal year for use in an

ensuing fiscal year, and which, under the method of accounting adopted by

the local government, will be charged against an appropriation of a

subsequent fiscal year. Purchase orders evidencing such contracts are

public records available for inspection by any person on demand.

(h) Long-term contracts for the furnishing of television or FM radio

broadcast translator signals as authorized by NRS 269.127.

(i) The receipt and proper expenditure of money received pursuant to a

grant awarded by an agency of the Federal Government.

(j) The incurrence of obligations beyond the current fiscal year under a

lease or contract for installment purchase which contains a provision that

the obligation incurred thereby is extinguished by the failure of the

governing body to appropriate money for the ensuing fiscal year for the

payment of the amounts then due.

Sec. 44. NRS 354.705 is hereby amended to read as follows:

354.705 1. As soon as practicable after the department takes over the

management of a local government, the executive director shall:

(a) Determine the total amount of expenditures necessary to allow the

local government to perform the basic functions for which it was created;

(b) Determine the amount of revenue reasonably expected to be

available to the local government; and

government.

2. If the executive director determines that the available revenue is not

sufficient to provide for the payment of required debt service and

operating expenses, he may submit his findings to the committee who

shall review the determinations made by the executive director. If the

committee determines that additional revenue is needed, it shall prepare a

recommendation to the Nevada tax commission as to which one or more

of the following additional taxes or charges should be imposed by the

local government:

(a) The levy of a property tax up to a rate which when combined with

all other overlapping rates levied in the state does not exceed $4.50 on

each $100 of assessed valuation.

(b) An additional tax on transient lodging at a rate not to exceed 1

percent of the gross receipts from the rental of transient lodging within the

boundaries of the local government upon all persons in the business of

providing lodging. Any such tax must be collected and administered in the

same manner as all other taxes on transient lodging are collected by or for

the local government.

(d) If the local government is a county or has boundaries that are

conterminous with the boundaries of the county:

(1) An additional tax on the gross receipts from the sale or use of

tangible personal property not to exceed one quarter of 1 percent

throughout the county. The ordinance imposing any such tax must include

provisions in substance which comply with the requirements of

subsections 2 to 5, inclusive, of NRS 377A.030.

(2) An additional governmental services tax of not more than 1 cent

on each $1 of valuation of the vehicle for the privilege of operating upon

the public streets, roads and highways of the county on each vehicle based

in the county except those vehicles exempt from the governmental

services tax imposed pursuant to chapter 371 of NRS or a vehicle subject

to NRS 706.011 to 706.861, inclusive, which is engaged in interstate or

intercounty operations. As used in this subparagraph, “based” has the

meaning ascribed to it in NRS 482.011.

3. Upon receipt of the plan from the committee, a panel consisting of

three members of the committee appointed by the committee and three

members of the Nevada tax commission appointed by the Nevada tax

commission shall hold a public hearing at a location within the boundaries

of the local government in which the severe financial emergency exists

after giving public notice of the hearing at least 10 days before the date on

which the hearing will be held. In addition to the public notice, the

[Nevada tax commission] panel shall give notice to the governing body of

each local government whose jurisdiction overlaps with the jurisdiction of

the local government in which the severe financial emergency exists.

4. After the public hearing[,] conducted pursuant to subsection 3, the

Nevada tax commission may adopt the plan as submitted or adopt a

revised plan. Any plan adopted pursuant to this section must include the

duration for which any new or increased taxes or charges may be collected

which must not exceed 5 years.

5. Upon adoption of the plan by the Nevada tax commission, the local

government in which the severe financial emergency exists shall impose

or cause to be imposed the additional taxes and charges included in the

plan for the duration stated in the plan or until the severe financial

emergency has been determined by the Nevada tax commission to have

ceased to exist.

6. The allowed revenue from taxes ad valorem determined pursuant to

NRS 354.59811 does not apply to any additional property tax levied

pursuant to this section.

Sec. 45. NRS 355.170 is hereby amended to read as follows:

355.170 1. Except as otherwise provided in this section, NRS

354.750 and section 1 of Assembly Bill No. 96 of this [act,] session, a

board of county commissioners, a board of trustees of a county school

district or the governing body of an incorporated city may purchase for

investment the following securities and no others:

(a) Bonds and debentures of the United States, the maturity dates of

which do not extend more than 10 years after the date of purchase.

(b) Farm loan bonds, consolidated farm loan bonds, debentures,

consolidated debentures and other obligations issued by federal land banks

and federal intermediate credit banks under the authority of the Federal

Farm Loan Act, formerly 12 U.S.C. §§ 636 to 1012, inclusive, and §§

1021 to 1129, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§

2001 to 2259, inclusive, and bonds, debentures, consolidated debentures

and other obligations issued by banks for cooperatives under the authority

of the Farm Credit Act of 1933, formerly 12 U.S.C. §§ 1131 to 1138e,

inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259,

inclusive.

which is not more than 10 years after the date of purchase.

(d) Obligations of an agency or instrumentality of the United States of

America or a corporation sponsored by the government, the maturity date

of which is not more than 10 years after the date of purchase.

(e) Negotiable certificates of deposit issued by commercial banks,

insured credit unions or savings and loan associations.

(f) Securities which have been expressly authorized as investments for

local governments or agencies, as defined in NRS 354.474, by any

provision of Nevada Revised Statutes or by any special law.

(g) Nonnegotiable certificates of deposit issued by insured commercial

banks, insured credit unions or insured savings and loan associations,

except certificates that are not within the limits of insurance provided by

an instrumentality of the United States, unless those certificates are

collateralized in the same manner as is required for uninsured deposits by

a county treasurer pursuant to NRS 356.133. For the purposes of this

paragraph, any reference in NRS 356.133 to a “county treasurer” or “board

of county commissioners” shall be deemed to refer to the appropriate

financial officer or governing body of the county, school district or city

purchasing the certificates.

(h) Subject to the limitations contained in NRS 355.177, negotiable

notes or [short-time negotiable bonds] medium-term obligations issued by

local governments of the State of Nevada pursuant to NRS [350.091.]

350.087 to 350.095, inclusive.

(i) Bankers’ acceptances of the kind and maturities made eligible by law

for rediscount with Federal Reserve Banks, and generally accepted by

banks or trust companies which are members of the Federal Reserve

System. Eligible bankers’ acceptances may not exceed 180 days’ maturity.

Purchases of bankers’ acceptances may not exceed 20 percent of the

money available to a local government for investment as determined on

the date of purchase.

(j) Obligations of state and local governments if:

(1) The interest on the obligation is exempt from gross income for

federal income tax purposes; and

(2) The obligation has been rated “A” or higher by one or more

nationally recognized bond credit rating agencies.

(k) Commercial paper issued by a corporation organized and operating

in the United States or by a depository institution licensed by the United

States or any state and operating in the United States that:

(1) Is purchased from a registered broker-dealer;

(2) At the time of purchase has a remaining term to maturity of no

more than 270 days; and

(3) Is rated by a nationally recognized rating service as “A-1,” “P-1”

or its equivalent, or better,

except that investments pursuant to this paragraph may not, in aggregate

value, exceed 20 percent of the total portfolio as determined on the date of

purchase, and if the rating of an obligation is reduced to a level that does

not meet the requirements of this paragraph, it must be sold as soon as

possible.

(l) Money market mutual funds which:

(1) Are registered with the Securities and Exchange Commission;

(2) Are rated by a nationally recognized rating service as “AAA” or

its equivalent; and

(3) Invest only in:

(I) Securities issued by the Federal Government or agencies of the

Federal Government;

(II) Master notes, bank notes or other short-term commercial paper

rated by a nationally recognized rating service as “A-1,” “P-1” or its

equivalent, or better, issued by a corporation organized and operating in

the United States or by a depository institution licensed by the United

States or any state and operating in the United States; or

(III) Repurchase agreements that are fully collateralized by the

obligations described in sub-subparagraphs (I) and (II).

2. Repurchase agreements are proper and lawful investments of money

of a board of county commissioners, a board of trustees of a county school

district or a governing body of an incorporated city for the purchase or sale

of securities which are negotiable and of the types listed in subsection 1 if

made in accordance with the following conditions:

(a) The board of county commissioners, the board of trustees of the

school district or the governing body of the city shall designate in advance

and thereafter maintain a list of qualified counterparties which:

(1) Regularly provide audited and, if available, unaudited financial

statements;

(2) The board of county commissioners, the board of trustees of the

school district or the governing body of the city has determined to have

adequate capitalization and earnings and appropriate assets to be highly

[credit worthy;] creditworthy; and

(3) Have executed a written master repurchase agreement in a form

satisfactory to the board of county commissioners, the board of trustees of

the school district or the governing body of the city pursuant to which all

repurchase agreements are entered into. The master repurchase agreement

must require the prompt delivery to the board of county commissioners,

the board of trustees of the school district or the governing body of the city

and the appointed custodian of written confirmations of all transactions

conducted thereunder, and must be developed giving consideration to the

Federal Bankruptcy Act.

(b) In all repurchase agreements:

(1) At or before the time money to pay the purchase price is

transferred, title to the purchased securities must be recorded in the name

of the appointed custodian, or the purchased securities must be delivered

with all appropriate, executed transfer instruments by physical delivery to

the custodian;

(2) The board of county commissioners, the board of trustees of the

school district or the governing body of the city must enter a written

contract with the custodian appointed pursuant to subparagraph (1) which

requires the custodian to:

(I) Disburse cash for repurchase agreements only upon receipt of

the underlying securities;

(II) Notify the board of county commissioners, the board of

trustees of the school district or the governing body of the city when the

securities are marked to the market if the required margin on the

agreement is not maintained;

(III) Hold the securities separate from the assets of the custodian;

and

(IV) Report periodically to the board of county commissioners, the

board of trustees of the school district or the governing body of the city

concerning the market value of the securities;

(3) The market value of the purchased securities must exceed 102

percent of the repurchase price to be paid by the counterparty and the

value of the purchased securities must be marked to the market weekly;

(4) The date on which the securities are to be repurchased must not

be more than 90 days after the date of purchase; and

(5) The purchased securities must not have a term to maturity at the

time of purchase in excess of 10 years.

3. The securities described in paragraphs (a), (b) and (c) of subsection

1 and the repurchase agreements described in subsection 2 may be

purchased when, in the opinion of the board of county commissioners, the

board of trustees of a county school district or the governing body of the

city, there is sufficient money in any fund of the county, the school district

or city to purchase those securities and the purchase will not result in the

impairment of the fund for the purposes for which it was created.

4. When the board of county commissioners, the board of trustees of a

county school district or the governing body of the city has determined

that there is available money in any fund or funds for the purchase of

bonds as set out in subsection 1 or 2, those purchases may be made and the

bonds paid for out of any one or more of the funds, but the bonds must be

credited to the funds in the amounts purchased, and the money received

from the redemption of the bonds, as and when redeemed, must go back

into the fund or funds from which the purchase money was taken

originally.

5. Any interest earned on money invested pursuant to subsection 3,

may, at the discretion of the board of county commissioners, the board of

trustees of a county school district or the governing body of the city, be

credited to the fund from which the principal was taken or to the general

fund of the county, school district or incorporated city.

6. The board of county commissioners, the board of trustees of a

county school district or the governing body of an incorporated city may

invest any money apportioned into funds and not invested pursuant to

subsection 3 and any money not apportioned into funds in bills and notes

of the United States Treasury, the maturity date of which is not more than

1 year after the date of investment. These investments must be considered

as cash for accounting purposes, and all the interest earned on them must

be credited to the general fund of the county, school district or

incorporated city.

7. This section does not authorize the investment of money

administered pursuant to a contract, debenture agreement or grant in a

manner not authorized by the terms of the contract, agreement or grant.

8. As used in this section:

(a) “Counterparty” means a bank organized and operating or licensed to

operate in the United States pursuant to federal or state law or a securities

dealer which is:

(1) A registered broker-dealer;

(2) Designated by the Federal Reserve Bank of New York as a

“primary” dealer in United States government securities; and

(3) In full compliance with all applicable capital requirements.

(b) “Repurchase agreement” means a purchase of securities by a board

of county commissioners, the board of trustees of a county school district

or the governing body of an incorporated city from a counterparty which

commits to repurchase those securities or securities of the same issuer,

description, issue date and maturity on or before a specified date for a

specified price.

Sec. 46. NRS 360.750 is hereby amended to read as follows:

360.750 1. A person who intends to locate or expand a business in

this state may apply to the commission on economic development for a

partial abatement of one or more of the taxes imposed on the new or

expanded business pursuant to chapter 361, 364A or 374 of NRS.

2. The commission on economic development shall approve an

application for a partial abatement if the commission makes the following

determinations:

(a) The business is consistent with:

(1) The state plan for industrial development and diversification that

is developed by the commission pursuant to NRS 231.067; and

(2) Any guidelines adopted pursuant to the state plan.

(b) The applicant has executed an agreement with the commission

which states that the business will, after the date on which a certificate of

eligibility for the abatement is issued pursuant to subsection 5, continue in

operation in this state for a period specified by the commission, which

must be at least 5 years, and will continue to meet the eligibility

requirements set forth in this subsection. The agreement must bind the

successors in interest of the business for the specified period.

applicant commits to obtain a valid business license and all other permits

required by the county, city or town in which the business operates.

(d) Except as otherwise provided in NRS 361.0687, if the business is a

new business in a county or city whose population is 50,000 or more, the

business meets at least two of the following requirements:

(1) The business will have 75 or more full-time employees on the

payroll of the business by the fourth quarter that it is in operation.

(2) Establishing the business will require the business to make a

capital investment of at least $1,000,000 in this state.

(3) The average hourly wage that will be paid by the new business to

its employees in this state is at least 100 percent of the average statewide

hourly wage as established by the employment security division of the

department of employment, training and rehabilitation on July 1 of each

fiscal year and:

(I) The business will provide a health insurance plan for all

employees that includes an option for health insurance coverage for

dependents of the employees; and

(II) The cost to the business for the benefits the business provides

to its employees in this state will meet the minimum requirements for

benefits established by the commission by regulation pursuant to

subsection 9.

(e) Except as otherwise provided in NRS 361.0687, if the business is a

new business in a county or city whose population is less than 50,000, the

business meets at least two of the following requirements:

(1) The business will have 25 or more full-time employees on the

payroll of the business by the fourth quarter that it is in operation.

(2) Establishing the business will require the business to make a

capital investment of at least $250,000 in this state.

(3) The average hourly wage that will be paid by the new business to

its employees in this state is at least 100 percent of the average statewide

hourly wage as established by the employment security division of the

department of employment, training and rehabilitation on July 1 of each

fiscal year and:

(I) The business will provide a health insurance plan for all

employees that includes an option for health insurance coverage for

dependents of the employees; and

(II) The cost to the business for the benefits the business provides

to its employees in this state will meet the minimum requirements for

benefits established by the commission by regulation pursuant to

subsection 9.

(f) If the business is an existing business, the business meets at least two

of the following requirements:

(1) The business will increase the number of employees on its payroll

by 10 percent more than it employed in the immediately preceding fiscal

year or by six employees, whichever is greater.

(2) The business will expand by making a capital investment in this

state in an amount equal to at least 20 percent of the value of the tangible

property possessed by the business in the immediately preceding fiscal

year. The determination of the value of the tangible property possessed by

the business in the immediately preceding fiscal year must be made by the:

(I) County assessor of the county in which the business will

expand, if the business is locally assessed; or

(II) Department, if the business is centrally assessed.

(3) The average hourly wage that will be paid by the existing

business to its new employees in this state is at least 100 percent of the

average statewide hourly wage as established by the employment security

division of the department of employment, training and rehabilitation on

July 1 of each fiscal year and:

(I) The business will provide a health insurance plan for all new

employees that includes an option for health insurance coverage for

dependents of the employees; and

(II) The cost to the business for the benefits the business provides

to its new employees in this state will meet the minimum requirements for

benefits established by the commission by regulation pursuant to

subsection 9.

3. Notwithstanding the provisions of subsection 2, the commission on

economic development may:

(a) Approve an application for a partial abatement by a business that

does not meet the requirements set forth in paragraph (d), (e) or (f) of

subsection 2;

(b) Make the requirements set forth in paragraph (d), (e) or (f) of

subsection 2 more stringent; or

a partial abatement,

if the commission determines that such action is necessary.

4. If a person submits an application to the commission on economic

development pursuant to subsection 1, the commission shall provide

notice to the governing body of the county and the city or town, if any, in

which the person intends to locate or expand a business. The notice

required pursuant to this subsection must set forth the date, time and

location of the hearing at which the commission will consider the

application.

5. If the commission on economic development approves an

application for a partial abatement, the commission shall immediately

forward a certificate of eligibility for the abatement to:

(a) The department;

(b) The Nevada tax commission; and

chapter 361 of NRS, the county treasurer.

6. An applicant for a partial abatement pursuant to this section or an

existing business whose partial abatement is in effect shall, upon the

request of the executive director of the commission on economic

development, furnish the executive director with copies of all

records necessary to verify that the applicant meets the requirements of

subsection 2.

7. If a business whose partial abatement has been approved pursuant to

this section and is in effect ceases:

(a) To meet the requirements set forth in subsection 2; or

(b) Operation before the time specified in the agreement described in

paragraph (b) of subsection 2,

the business shall repay to the department or, if the partial abatement was

from the property tax imposed pursuant to chapter 361 of NRS, to the

county treasurer, the amount of the exemption that was allowed pursuant

to this section before the failure of the business to comply unless the

Nevada tax commission determines that the business has substantially

complied with the requirements of this section. Except as otherwise

provided in NRS 360.232 and 360.320, the business shall, in addition to

the amount of the exemption required to be paid pursuant to this

subsection, pay interest on the amount due at the rate most recently

established pursuant to NRS 99.040 for each month, or portion thereof,

from the last day of the month following the period for which the payment

would have been made had the partial abatement not been approved until

the date of payment of the tax.

8. A county treasurer:

(a) Shall deposit any money that he receives pursuant to subsection 7 in

one or more of the funds established by a local government of the county

pursuant to NRS [354.611,] 354.6113 or 354.6115; and

(b) May use the money deposited pursuant to paragraph (a) only for the

purposes authorized by NRS [354.611,] 354.6113 and 354.6115.

9. The commission on economic development:

(a) Shall adopt regulations relating to:

(1) The minimum level of benefits that a business must provide to its

employees if the business is going to use benefits paid to employees as a

basis to qualify for a partial abatement; and

(2) The notice that must be provided pursuant to subsection 4.

(b) May adopt such other regulations as the commission on economic

development determines to be necessary to carry out the provisions of this

section.

10. The Nevada tax commission:

(a) Shall adopt regulations regarding:

(1) The capital investment that a new business must make to meet the

requirement set forth in paragraph (d) or (e) of subsection 2; and

(2) Any security that a business is required to post to qualify for a

partial abatement pursuant to this section.

(b) May adopt such other regulations as the Nevada tax commission

determines to be necessary to carry out the provisions of this section.

11. An applicant for an abatement who is aggrieved by a final decision

of the commission on economic development may petition for judicial

review in the manner provided in chapter 233B of NRS.

Sec. 47. NRS 374A.020 is hereby amended to read as follows:

374A.020 1. The collection of the tax imposed by NRS 374A.010

must be commenced on the first day of the first calendar quarter that

begins at least 30 days after the last condition in subsection 1 of NRS

374A.010 is met.

2. The tax must be administered, collected and distributed in the

manner set forth in chapter 374 of NRS.

3. The board of trustees of the school district shall transfer the

proceeds of the tax imposed by NRS 374A.010 from the county school

district fund to the fund described in NRS [354.611 which has been]

354.6105 which must be established by the board of trustees. The money

deposited in the fund described in NRS [354.611] 354.6105 pursuant to

this subsection must be accounted for separately in that fund and must

only be expended by the board of trustees for the cost of the extraordinary

maintenance, extraordinary repair and extraordinary improvement of

school facilities within the county.

Sec. 48. NRS 387.335 is hereby amended to read as follows:

387.335 1. The board of trustees of a county school district may

issue its general obligations to raise money for the following purposes, and

no others:

(a) Construction, design or purchase of new buildings for schools,

including, but not limited to, teacherages, dormitories, dining halls,

gymnasiums and stadiums.

(b) Enlarging, remodeling , [or] repairing or replacing existing

buildings or grounds for schools, including, but not limited to,

teacherages, dormitories, dining halls, gymnasiums and stadiums.

necessary purposes related to schools, including, but not limited to,

playgrounds, athletic fields and sites for stadiums.

(d) Paying expenses relating to the acquisition of school facilities which

have been leased by a school district pursuant to NRS 393.080.

(e) Purchasing necessary furniture and equipment for schools [.] ,

including, without limitation, equipment used in educating pupils,

furniture for school buildings and equipment used for the transportation

of pupils. If money from the issuance of general obligations is used to

purchase furniture and equipment to replace existing furniture and

equipment, and that existing furniture and equipment subsequently is sold,

the proceeds from the sale must be applied toward the retirement of those

obligations. If equipment used for the transportation of pupils is

purchased pursuant to this paragraph, only the following equipment

may be purchased:

(1) Motor vehicles that use biodiesel, compressed natural gas or a

similar fuel formulated to reduce emissions from the amount of

emissions produced from traditional fuels such as gasoline and diesel

fuel;

(2) Equipment to retrofit motor vehicles to use biodiesel,

compressed natural gas or a similar fuel formulated to reduce emissions

from the amount of emissions produced from traditional fuels such as

gasoline and diesel fuel; or

(3) Equipment for the transportation, storage or dispensing of

biodiesel, compressed natural gas or similar fuels formulated to reduce

emissions from the amount of emissions produced from traditional fuels

such as gasoline and diesel fuel.

2. Any one or more of the purposes enumerated in subsection 1 may,

by order of the board of trustees entered in its minutes, be united and voted

upon as one single proposition.

3. Any question submitted pursuant to this section and any question

submitted pursuant to NRS 387.3285 may, by order of the board of

trustees entered in its minutes, be united and voted upon as a single

proposition.

4. As used in this section, “biodiesel” has the meaning ascribed to it

in 42 U.S.C. § 13220.

Sec. 49. NRS 387.516 is hereby amended to read as follows:

387.516 1. The board of trustees of a school district may apply to the

state treasurer for a guarantee agreement whereby money in the state

permanent school fund is used to guarantee the payment of the debt

service on bonds that the school district will issue. The amount of the

guarantee for bonds of each school district outstanding at any one time

must not exceed $25,000,000.

2. The application must be on a form prescribed by the state treasurer.

The state treasurer shall develop the form in consultation with the

executive director.

3. Medium-term obligations entered into pursuant to the provisions of

NRS [350.085] 350.087 to 350.095, inclusive, are not eligible for

guarantee pursuant to NRS 387.513 to 387.528, inclusive.

4. Upon receipt of an application for a guarantee agreement from a

school district, the state treasurer shall provide a copy of the application

and any supporting documentation to the executive director. As soon as

practicable after receipt of a copy of an application, the executive director

shall investigate the ability of the school district to make timely payments

on the debt service of the bonds for which the guarantee is requested. The

executive director shall submit a written report of his investigation to the

state board of finance indicating his opinion as to whether the school

district has the ability to make timely payments on the debt service of

the bonds.

Sec. 50. NRS 387.526 is hereby amended to read as follows:

387.526 1. If a school district fails to make a timely payment on the

debt service of bonds that are guaranteed pursuant to the provisions of

NRS 387.513 to 387.528, inclusive, the state treasurer shall:

(a) Withdraw from the state permanent school fund the amount of

money due for the payment on the debt service;

(b) Make the payment on the debt service; and

2. The amount of money withdrawn pursuant to subsection 1 shall be

deemed a loan to the school district from the state permanent school fund.

The state treasurer shall determine the rate of interest on the loan, which

must not exceed 1 percent above the average rate of interest yielded on

investments in the state permanent school fund on the date that the loan is

made. A loan that is made to a school district pursuant to this subsection is

a special obligation of the school district and is payable only from the

sources specified in NRS 387.528.

3. A school district that receives a loan pursuant to this section shall

not:

(a) Include the loan as a general obligation of the school district when

determining any limit on the debt of the school district.

(b) Unless the school district obtains the written approval of the

executive director, for the period during which the loan is unpaid, enter

into any medium-term obligations or installment-purchase agreement

pursuant to the provisions of NRS [350.085] 350.087 to 350.095,

inclusive, or otherwise borrow money.

4. If the executive director receives notice that a loan has been made

pursuant to this section, he shall proceed pursuant to the provisions of

NRS 354.685.

Sec. 51. NRS 387.528 is hereby amended to read as follows:

387.528 1. If a loan is made from the state permanent school fund

pursuant to NRS 387.526, the loan must be repaid[:

1. By] by the school district from the money that is available to the

school district to pay the debt service on the bonds that are guaranteed

pursuant to the provisions of NRS 387.513 to 387.528, inclusive, unless

payment from that money would cause the school district to default on

other outstanding bonds , [or] medium-term obligations or installment

-purchase agreements entered into pursuant to the provisions of NRS

[350.085] 350.087 to 350.095, inclusive; and

2. If the school district is not able to repay fully the loan, including any

accrued interest, in a timely manner pursuant to subsection 1 or by any

other lawful means, the state treasurer shall withhold the payments of

money that would otherwise be distributed to the school district from:

(a) The interest earned on the state permanent school fund that is

distributed among the various school districts;

(b) Distributions of the local school support tax, which must be

transferred by the state controller upon notification by the state treasurer;

and

until the loan is repaid, including any accrued interest on the loan. The

state treasurer shall apply the money first to the interest on the loan and,

when the interest is paid in full, then to the balance. When the interest and

balance on the loan are repaid, the state treasurer shall resume making the

distributions that would otherwise be due to the school district.

Sec. 52. NRS 496.155 is hereby amended to read as follows:

496.155 1. Subject to the provisions of NRS 496.150 and subsections

2 and 3 of this section, for any undertaking authorized in NRS 496.150,

the governing body of a municipality, as it determines from time to time,

may, on the behalf and in the name of the municipality, borrow money,

otherwise become obligated, and evidence the obligations by the issuance

of bonds and other municipal securities, and in connection with the

undertaking or the municipal airport, including, without limitation, air

navigation facilities and other facilities appertaining to the airport, the

governing body may otherwise proceed as provided in the Local

Government Securities Law or as provided in subsections 4 and 5.

2. General obligation bonds, whether or not their payment is

additionally secured by a pledge of net revenues, must be sold as provided

in the Local Government Securities Law.

3. Revenue bonds may be sold at a public sale as provided in the Local

Government Securities Law or at a private sale.

4. The governing body may by resolution acquire real property for the

expansion of airport or air navigation facilities by entering into contracts

of purchase, of a type and duration and on such terms as the governing

body determines, including, without limitation, contracts secured by a

mortgage or other security interest in the real property. The governing

body may not use any revenue derived from taxes ad valorem to pay for

the acquisition, and the obligation under the contract does not constitute a

general obligation of the municipality or apply against any debt limitation

pertaining to the municipality.

5. The governing body may by resolution enter into a medium-term

obligation or installment-purchase agreement for any undertaking

authorized in NRS 496.150 and issue negotiable instruments without

regard to the requirements specified in:

(a) Paragraphs (a) and (b) of subsection 2 of NRS 350.091; and

(b) Subsections 1 and 2 of NRS 350.089, unless the financing is to be

repaid from the proceeds of a special tax exempt from limitations on taxes

ad valorem.

Sec. 53. NRS 555.215 is hereby amended to read as follows:

555.215 1. Upon the preparation and approval of a budget in the

manner required by the Local Government Budget Act, the board of

county commissioners of each county having lands situated in the district

shall, by resolution, levy an assessment upon all real property in the

county which is in the weed control district.

2. Every assessment so levied is a lien against the property assessed.

3. Amounts collected in counties other than the county having the

larger or largest proportion of the area of the district must be paid over to

the board of county commissioners of that county for the use of the

district.

4. The county commissioners of that county may obtain medium-term

obligations pursuant to NRS [350.085] 350.087 to 350.095, inclusive, of

an amount of money not to exceed the total amount of the assessment, to

pay the expenses of controlling the weeds in the weed control district. The

loans may be made only after the assessments are levied.

Sec. 54. Section 12 of chapter 227, Statutes of Nevada 1975, as

amended by chapter 351, Statutes of Nevada 1997, at page 1280, is hereby

amended to read as follows:

Sec. 12. 1. The provisions of the Local Government Budget

Act, NRS 354.470 to 354.626, inclusive, as now and hereafter

amended, apply to the Authority as a local government, and the

Authority shall, for purposes of that application, be deemed a district

other than a school district.

2. The provisions of NRS [350.085] 350.087 to 350.095,

inclusive, apply to the Authority.

Sec. 55. Section 20 of chapter 474, Statutes of Nevada 1977, as last

amended by chapter 203, Statutes of Nevada 1997, at page 567, is hereby

amended to read as follows:

Sec. 20. The authority may enter into medium-term obligations

and installment-purchase obligations in compliance with NRS

350.087 to 350.095, inclusive.

Sec. 56. Section 8A.140 of the charter of Carson City, being chapter

16, Statutes of Nevada 1997, at page 45, is hereby amended to read as

follows:

Sec. 8A.140 Types of securities; pledged revenue.

1. For the acquisition, development, construction, equipping,

operation, maintenance, improvement and management of open

spaces, parks, trails and recreational facilities authorized by this

article, the board may issue:

(a) General obligation bonds;

(b) General obligation bonds for which payment is additionally

secured by a pledge of the proceeds of the tax imposed pursuant to

this article, and if so determined by the board, further secured by a

pledge of the gross or net revenues derived from the operation of the

recreational facilities, and any other project of the city which

produces income, or from any license fees or other excise taxes

imposed for revenue by the city, or otherwise, as may be legally

made available for payment of the bonds;

pledge of the proceeds of the tax imposed pursuant to this article, and

if so determined by the board, further secured by a pledge of the

gross or net revenues derived from the operation of the recreational

facilities, and any other project of the city which produces income, or

from any license fees or other excise taxes imposed for revenue by

the city, or otherwise, as may be legally made available for payment

of the bonds; and

(d) Medium-term obligations pursuant to NRS [350.085] 350.087

to 350.095, inclusive.

2. Money pledged to the payment of bonds or other securities

pursuant to subsection 1 may be treated for the purposes of

subsection 3 of NRS 350.020 as pledged revenue for the uses

authorized by this article.

Sec. 57. Section 24 of chapter 37, Statutes of Nevada 1999, at page

85, is hereby amended to read as follows:

Sec. 24. 1. To acquire, develop, construct, equip, improve and

manage libraries, airports, and facilities and services for senior

citizens located in the county, the board may issue:

(a) General obligation bonds;

(b) General obligation bonds for which payment is additionally

secured by a pledge of the proceeds of the tax imposed pursuant to

this act, and if so determined by the board, further secured by a

pledge of the gross or net revenues derived from the operation of

libraries, airports or facilities and services for senior facilities or any

other project of the county which produces income, or from any

license fees or other excise taxes imposed for revenue by the county,

or otherwise, as may be legally made available for payment of the

bonds;

pledge of the proceeds of the tax imposed pursuant to this act, and if

so determined by the board, further secured by a pledge of the gross

or net revenues derived from the operation of the libraries, airports or

facilities for senior citizens or any other project of the county which

produces income, or from any license fees or other excise taxes

imposed for revenue by the county, or otherwise, as may be legally

made available for payment of the bonds; and

(d) Medium-term obligations pursuant to NRS [350.085] 350.087

to 350.095, inclusive.

2. Money pledged to the payment of bonds or other securities

pursuant to subsection 1 may be treated for the purposes of

subsection 3 of NRS 350.020 as pledged revenue for the uses

authorized by this act.

Sec. 58. NRS 350.085, NRS 354.5235, 354.6107 and 354.611 are

hereby repealed.

Sec. 59. 1. Except as otherwise provided in subsection 2, all money

in an extraordinary maintenance fund created pursuant to NRS 354.6107

or 354.611 must be transferred to an extraordinary maintenance fund

established pursuant to NRS 354.6105 and must be used for the purposes

set forth in that section.

2. Money in an extraordinary maintenance fund created pursuant to

NRS 354.611 that was collected pursuant to NRS 374A.020 must be:

(a) Transferred to an extraordinary maintenance fund created pursuant

to NRS 354.6105;

(b) Accounted for separately in that fund; and

NRS 374A.020.

Sec. 59.5. A board of trustees of a county school district that issues

general obligations on or after the effective date of this act for purchases

of necessary furniture and equipment for schools pursuant to paragraph (e)

of subsection 1 of NRS 387.335, as amended by section 48 of this act,

shall submit to the director of the legislative counsel bureau for

transmission to the legislative commission on or before February 1, 2003,

a report which itemizes those purchases made through December 31,

2002.

Sec. 60. 1. This section, sections 48 and 59.5 of this act become

effective upon passage and approval.

2. Sections 1 to 22, inclusive, 24 to 36, inclusive, 38, 40 to 43,

inclusive, 46, 47 and 49 to 59, inclusive, of this act become effective on

July 1, 2001.

3. Sections 37, 39, 44 and 45 of this act become effective at 12:01 a.m.

on July 1, 2001.

4. Section 23 of this act becomes effective at 12:02 a.m. on July 1,

2001.

5. Section 48 of this act expires by limitation on July 1, 2003.

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