MINUTES OF THE meeting
of the
ASSEMBLY Committee on Commerce and Labor
Seventy-Second Session
February 19, 2003
The Committee on Commerce and Laborwas called to order at 2:13 p.m., on Wednesday, February 19, 2003. Chairman David Goldwater presided in Room 4100 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Mr. David Goldwater, Chairman
Ms. Barbara Buckley, Vice Chairman
Mr. Morse Arberry Jr.
Mr. Bob Beers
Mr. David Brown
Mrs. Dawn Gibbons
Ms. Chris Giunchigliani
Mr. Josh Griffin
Mr. Lynn Hettrick
Mr. Ron Knecht
Ms. Sheila Leslie
Mr. John Oceguera
Mr. David Parks
Mr. Richard Perkins
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
None
STAFF MEMBERS PRESENT:
Vance Hughey, Committee Policy Analyst
Wil Keane, Committee Counsel
Diane Thornton, Committee Policy Analyst
Corey Fox, Committee Secretary
OTHERS PRESENT:
Judy Cook, Real Estate Educator
Melody Luetkehans, General Counsel for the Nevada Association of Realtors
Marshall Schultz, President Residents Information Center Inc.
Mike Veatch, Owner and Broker for Valley Realty and Management
Chairman Goldwater called the meeting to order at 2:13 p.m. and indicated that Mr. Beers would be tardy; all other members were present and there was a quorum present.
Senate Bill 13: Revises provision requiring landlord to disclose emergency telephone number to tenant at or before commencement of tenancy. (BDR 10-662)
Chairman Goldwater stated that S.B. 13 was on the agenda for the day and its purpose was to revise landlord matters. He then indicated that one of his favorite chapters from his earlier years as a legislator was NRS 118A. He stated a few people had signed in to speak on behalf of the bill and called Judy Cook, Real Estate Educator, up to testify. Chairman Goldwater then asked if all speakers wanted to approach the testimony stand together, that would be acceptable. He then indicated that Senator McGinness had sponsored S.B. 13, but he would not be present for the hearing of that bill.
Melody Luetkehans, General Counsel, Nevada Association of Realtors, explained that her association had approximately 13,000 members, and around 2,000 to 3,000 of those members held property manager certificates. Ms. Luetkehans indicated that as property managers, she and her company were in support of this bill because it gave members, landlords, and the tenants greater flexibility. Ms. Luetkehans then introduced Judy Cook, Real Estate Educator. Ms. Cook began and stated that as part of her duties she taught property management, pre-licensing, and continuing education courses. She explained that she also held a broker salesman license and property management permit and had been in the business for over 25 years. She expressed her support of S.B. 13 because it took into consideration the needs of property managers in the more rural areas.
Marshall Schultz, President, Residents Information Center Inc., stated his organization was a tax-exempt organization. He then apologized for the header of the exhibit (Exhibit C) he had brought in because it stated the exhibit was intended for the Committee on Judiciary on the Senate side. He indicated that it was just a mistake on his part. Mr. Schultz explained his corporation was known in the state of Nevada as Nevada Renters Hotline. He explained that his was the only office in Nevada where tenants, landlords, and real estate agents could call for information on the rental laws. Mr. Schultz indicated that his corporation was the only office in Nevada that collected and collated information on a rental problem for all of the state. He explained that many state and government offices referred callers to his hotline. Mr. Schultz stated that even the Governor’s Office and the Attorney General’s office referred calls to his hotline. He explained that his company did not give legal advice; they only gave practical guidance. Mr. Schultz explained his company did not receive money from the government or any other funding organization; their revenue came entirely from people who called their hotline. He then stated that a small amount of people, approximately 5 percent, donated small amounts of money to his company. Mr. Schultz then expressed that this was enough for his company to render the services that they provided, which they had been doing since 1995.
Mr. Schultz pointed out the main concern his company had was that S.B. 13 lacked a device that enforced landlords’ cooperation with the statute. He explained the original legislation that had incorporated a fee for violation was NRS 118A.260.1(b), and it stated that the penalty, enacted in 1977, was that a tenant could recover the greater amount of actual damages or $25. He then explained that even in 1977 that amount of money had not been large enough for anyone to take it seriously. Mr. Schultz explained that he would like to propose an amendment that penalized the many landlords who did not comply with that statute. He also explained that his company would like to propose an amendment that provided a method of imposing the penalty without requiring tenants to go to court. Mr. Schultz proposed a $500 penalty, which corresponded to penalties that the Real Estate Division could impose on property managers under NRS 645.633 and NAC 645.605. He believed that a state agency should be authorized to investigate claims of a landlord’s failure to comply with the statute. He also wanted to make sure a penalty would be imposed. Mr. Schultz indicated that he had researched this issue extensively with the Attorney General’s Office and the Real Estate Division, and together they believed the Real Estate Division was the only agency even remotely prepared to do this.
Chairman Goldwater reminded Mr. Schultz that this was a Senate bill and asked him if he had proposed these amendments on the Senate side.
Mr. Schultz indicated he had not made it to the Senate hearing because he had been misinformed as to when it occurred. Mr. Schultz explained he had left the information on these amendments with Senator McGinness’s office. Mr. Schultz explained that the last portion of his testimony was on the document (Exhibit C), which had been handed out earlier. He then offered to answer any questions.
Ms. Giunchigliani asked Mr. Schultz for confirmation that his organization did not give out legal advice but merely provided simple referrals and explanations of the tenant law. Mr. Schultz stated this was correct and further commented that most people in the state of Nevada were not aware of the Landlord and Tenant Law. He explained that his company provided tenants with that information and would inform them on how to get a copy of that law. Mr. Schultz explained the easiest way to get copies of the law was from the Internet or a local public library. He then stated that if tenants did not have Internet access, they would instruct them to put all information and correspondence in writing.
Ms. Giunchigliani asked Mr. Schultz for clarification on his proposal, and he replied that his recommendation was a substantial increase in the penalty and it also provided for a method to impose the penalty. He explained the only current way of imposing the penalty was if tenants went to court, and very few tenants would do that for fear of rental problems in the future.
Chairman Goldwater asked if Ms. Cook and Ms. Luetkehans concurred with Mr. Schultz on the proposed amendment. Ms. Luetkehans indicated she and Ms. Cook had no prior knowledge of this amendment. Ms. Giunchigliani followed with a question concerning NRS 118A.410, which was a penalty for failure to disclose. She then asked if anyone testifying knew how to define “actual damages” and asked for clarification on actual damages for not disclosing information and what type of information was covered.
Mr. Schultz answered that in the seven years the Nevada Renters Hotline had operated, there was absolutely no way to prove actual damages. Nobody could prove actual damages for failure to supply that information as required under the section of NRS 118A.260.
Ms. Giunchigliani asked the others testifying if they had any suggestions that might help to tighten up the language in the statute. Ms. Luetkehans stated she would work with Mr. Schultz for a modification at some other time. She indicated that NRS 118.410 did not touch upon that statute and there were several other landlord and tenant bills currently in process that had not been heard in their houses of origin. She respectfully suggested that Mr. Schultz and the Residential Information Center make offers of amendments to bills not already in process, since S.B. 13 already was.
Assemblywoman Giunchigliani asked for clarification for penalties in NRS 118A.260, and Ms. Luetkehans indicated there were none. Ms. Giunchigliani then asked if co-ops would be covered under this statute. Ms. Luetkehans asked if she meant actual cooperatives or condominiums. Ms. Giunchigliani said that to her knowledge, a co-op was a remodeled four-plex that did not include homeowner’s dues. Ms. Luetkehans replied that NRS 118A described a variety of housing exempt from statute. She believed some exemptions would be modified in S.B. 128. Ms. Luetkehans stated some government buildings and mobile homes were not covered under that statute, including any residences of a 124-unit building that were managed and owned by an individual. She then indicated that once a property manager was involved, NRS 118A would take effect.
Ms. Giunchigliani indicated that this could lead to a circumstance where an owner might call their residence a co-op and they would not have any rights as a tenant. Ms. Luetkehans confirmed this was correct and stated that in some buildings in the eastern United States there was more often a cooperative situation in which the portions of the complex were bought out. She stated in that case, the tenant did not actually own the unit. Ms. Giunchigliani then reiterated that the opportunity to tighten up this legislation could still be possible. She expressed her concern that definitions were lacking something, and she thought that rent control for senior citizens was something that still needed consideration.
Chairman Goldwater explained to Mr. Schultz that the common method of legislation was to contact the sponsor of the bill to propose any amendments. Mr. Schultz then stated he would have done that earlier that day but had misunderstood information on the hearings. Chairman Goldwater suggested that he go to Senator McGinness’s office at that time and Mr. Schultz stated that he intended to do so.
Chairman Goldwater then called Mike Veatch, Owner and Broker, Valley Realty and Management, who gave his support for S.B. 13. Mr. Veatch expressed his astonishment of the provision established two years prior for a need of a contact outside the county line in which the rental property existed. He believed this was a hardship and very impractical. He expressed that putting a 60-mile perimeter route around a rental property made a lot more sense then any political boundary. He then reiterated his support for S.B. 13.
There being no further business before the Committee, Chairman Goldwater closed the hearing on S.B. 13 and adjourned the meeting at 2:29 p.m.
RESPECTFULLY SUBMITTED:
Corey Fox
Committee Secretary
APPROVED BY:
Assemblyman David Goldwater, Chairman
DATE: