MINUTES OF THE meeting
of the
ASSEMBLY Committee on Government Affairs
Subcommittee
Seventy-Second Session
March 11, 2003
The Committee on Government Affairs Subcommittee on A.B. 196was called to order at 7:00 a.m., on Tuesday, March 11, 2003. Chairman Bob McCleary presided in Room 3143 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
Note: These minutes are compiled in the modified verbatim style. Bracketed material indicates language used to clarify and further describe testimony. Actions of the Committee are presented in the traditional legislative style.
COMMITTEE MEMBERS PRESENT:
Mr. Bob McCleary, Chairman
Mr. Tom Collins
Mr. Tom Grady
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
None
STAFF MEMBERS PRESENT:
Susan Scholley, Committee Policy Analyst
Rosemary Zienter, Committee Secretary
OTHERS PRESENT:
Gary Milliken, Government Relations, Public Affairs, GEM Consulting
Kami Dempsey, Government Relations Manager, City of Las Vegas
Terry Graves, Graves Communications
Mike Lynch, Government Affairs Director, The Builders
K. Neena Laxalt, Government Relations Consultant
John J. Slaughter, AICP, Legislative Affairs Program Manager, Washoe County
Karen Mullen, Director, Washoe County Parks and Recreation Department
Mary Walker, President, Walker and Associates
Russell Rowe, Attorney at Law, Kummer, Kaempfer, Bonner, and Renshaw
Rick DeMar, Executive Officer, Builders Association of Western Nevada
Good morning, everybody. Welcome to our Subcommittee on Government Affairs on Assembly Bill 196. I would ask the secretary to please call the roll. [Roll called]
Assembly Bill 196: Authorizes certain local governments to require dedication of certain land or impose tax on nonresidential construction projects for regional parks. (BDR 22-653)
Chairman McCleary:
We are really surprised to see such a great turn out this morning. I mingled with a few of you, and I really didn’t hear anything new that needs to be brought up. If that is so, we are just going to go ahead and start our work session.
Assemblyman Collins:
Thank you, Mr. Chairman. A couple of issues that have been brought up is whether this should just be in Clark County, or statewide. I think the greatest need with all the growth is that it be in Clark County, and leave the rest of the people to figure out where they want to go, whether they want to do something or not. They can energize folks from the north and the rest of the state to help them with that. From what I understand, there are two issues. Terry Graves and Gary Milliken still have issues. Have those been resolved? Terry’s has not been resolved, Gary? Mr. Chairman, could we have those two individuals come up?
Gary Milliken, Government Relations, Public Affairs, GEM Consulting:
Mr. Chairman and Committee members, for the record, Gary Milliken, representing the Associated General Contractors. I guess for discussion purposes, I’d like to go to page 3, Section 5, [paragraph] 2, sub[section] c. I know, Assemblyman Collins, you and I have had this discussion before. Are we talking about the $20,000? Does that apply to one project regardless of how many permits there are, or is that limitation of $20,000 per permit?
Assemblyman Collins:
Let me ask Kami [Dempsey], from the City of Las Vegas. Do you have that chart with you this morning? Have you got copies of that? Gary, have you seen this [copy of the chart Exhibit C]?
Gary Milliken:
No, I haven’t.
Kami Dempsey, Government Relations Manager, City of Las Vegas:
Kami Dempsey, with the City of Las Vegas, just for the record, our bill drafter is working also with Howard Hughes bill drafters. We have drafted the language so the fee is for the total building, not based on the permit which would then, of course, be excessive in cost. So it has been limited.
Assemblyman Collins:
So that amendment is proposed, correct?
Kami Dempsey:
I think how it states in the law right now, it has been interpreted that is how it is now.
Assemblyman Collins:
Are you comfortable with that, Terry?
Terry Graves, Graves Communications:
Yes, if you say that is what it means. I just want to get on the record to be certain that instead of $20,000 per permit, and you did ten permits, you would be at $200,000. Yet one guy can have a bigger project with one permit, and he pays $20,000. We had this discussion a long time ago, and I just want to make certain that we are talking about $20,000 is the top, per project.
Assemblyman Collins:
The City developed a chart [Exhibit C], for the record, Mr. Chairman, [that shows] in the year 2002, commercial construction values in the City of Las Vegas were approximately $182 million. Based on the language of the proposed legislation, if that were in place, the 1 percent-per-project average would be $10,643.27. In the year 2001, the commercial construction valuation in Las Vegas was $164 million, and the 1 percent-per-project average was $9,761.90. Does that solve your issues, too, Gary?
Gary Milliken:
[He indicated yes.]
Assemblyman Collins:
The intent is there and we will carry forward with that intent.
Gary Milliken:
That is fine. I just wanted it on the record. The only other comment I will make is I still think it is a tax increase, and it is just not a great year for tax increases.
Assemblyman Collins:
There is never a great year, but there is always a need. It is just like when you go and get a side job because you have a child in college.
Terry Graves:
Mr. Chairman, I guess I had the understanding that it was the way the amendment is proposing. I don’t know that it changes my position. It emotionally pains me to be opposed to you, Mr. Collins. But I am having trouble with this bill, and I haven’t seen this [Exhibit C].
Assemblyman Collins:
We are down to Dan Stewart in the south [Las Vegas, Nevada area]. Is there any other opposition in the south? [no response]
Chairman McCleary:
Do the Subcommittee members have any questions for the two gentlemen that are here? [no response]
Terry Graves:
I’ll just remind the Committee of the other problem we had that was the cap and the competitive issue between large and small projects.
Chairman McCleary:
Is Mike Lynch here? [Mike Lynch raised his hand from the audience]. Did you want to say a few words?
Mike Lynch, Government Affairs Director, The Builders:
Mr. Chairman, my name is Mike Lynch, representing the Builders Association of Northern Nevada. It is my understanding that northern Nevada may, for the time being, be exempt from the provisions of this bill. We will reserve our comments until the time that issue is resolved.
Chairman McCleary:
Thank you, Mike. Are there any questions for Mike?
Assemblyman Collins:
Just for clarification, the difference between neighborhood park and regional park would be addressed differently from your impact fees and this legislation. I think there would possibly be some areas that might overlap if it was a PUD [Public Utility District], for example. So there would be some regional impact, but primarily there are going to be times when Sparks, which is what your are talking about, has an impact fee that is for neighborhood parks. If this were to pass, including the north [northern Nevada], I believe some of that would overlap and some would not. Does that make sense? Your impact fee is not on commercial, is that right?
Mike Lynch:
Mr. Collins, it is only on residential.
Assemblyman Collins:
The residential projects are impacted by an impact fee, currently, and if this came in, it would be on the non-residential projects. There would not be a double taxation on any square inch of dirt. Is that your understanding, and does that make sense?
Mike Lynch:
Yes, it does. There is a gap, though. Projects up to 25 acres can be funded. Those are [inaudible] the neighborhood parks with the residential construction tax currently enabled. This proposed change would allow local governments to tax commercial development for projects over 50 acres which they are describing as the regional parks. Impact fees can be used for parks, both neighborhood or regional parks up to 50 acres. There is a gap there because I would encourage addressing that issue enabling both impact fees and the construction taxes for parks to cover both scenarios without the gap, regional parks of any size over 25 acres, and neighborhood parks of 25 acres and under. The double taxation issue was raised by questioning what the Legislature intended in 2001 when they implemented the impact fee process for parks. It clearly states that if an owner is required to pay a residential construction tax pursuant to the [Nevada Revised Statutes]NRS 278, that they would receive a credit against any impact fee for parks under [NRS] 278B. We would just want to re-verify that that was the Legislature’s intent regardless of whether the money was used for regional parks or neighborhood parks.
Assemblyman Collins:
[Question addressed to Susan Scholley, Committee Policy Analyst]. Can you get that researched? And you will fix that if it needs to be?
Susan Scholley:
Northern Nevada, as I understand it, is going to be excluded by the amendment. So this would be an anticipated issue?
Assemblyman Collins:
Yes, it would be. The last thing I am going to suggest is taking everybody out but Clark County. I am seeing how big this armament is out here.
Mike Lynch:
For the record, the Builders Association supports the installation and funding of these facilities, both the regional parks and the neighborhood parks because we like kids a lot.
Chairman McCleary:
The Committee is entertaining a proposal to make this include Clark County only. Ms. Laxalt, do you still want to speak?
K. Neena Laxalt, Government Relations Consultant:
Neena Laxalt on behalf of the City of Sparks. I just wanted to say that I just talked to the Washoe representatives and the Reno representatives, and we do agree, for now, to be exempted from this piece of legislation. We do have outstanding issues, specifically the City of Sparks, with the Nevada Home Builders. We would like to continue to work on that, but in the attitude of moving this bill along, for now we would like to agree. However, if we continue to stay in, we still want to see the gap on the acreage addressed. We believe that would help everyone, the 25.1 to 49.9 acres. If you have any questions, I would be happy to answer them.
Assemblyman Grady:
I think at the last meeting we had some conversations over how this would affect Washoe County if they were included in this, because of their caps override. Could John [Slaughter] come up and explain that to us.
Assemblyman Collins:
It’s enabling. If they do not implement it, it doesn’t do anything.
Assemblyman Grady:
They already have a tax implemented. That is what I’m asking, if they want this one on top of it. If they are opted out of it then I have no problem with it.
John J. Slaughter, AICP, Legislative Affairs Program Manager, Washoe County:
[Introduced himself] Thank you, Mr. Chairman. I have our Parks Director, Karen Mullen, here to assist in the discussion.
Karen Mullen, Director, Washoe County Parks and Recreation Department:
[Introduced herself] Thank you. We don’t have a tax implemented. What we had done previously was a bond issue. I do want to say that every time we do a bond issue, it seems that we have more projects to accomplish, that the community would like to see, than we can fund. The last bond issue we had over $40 million worth of projects that we weren’t able to fund. It is always a quandary for us to find funding sources for these projects, and for the community. Thank you.
Chairman McCleary:
One quick question, so was that you’re in favor of this thing?
Karen Mullen:
We are in favor of it.
Mary Walker, President, Walker and Associates:
Thank you, Mr. Chairman. For the record, Mary Walker, representing Carson City, Douglas County, and Lyon County. With me this morning is Scott Morgan, Douglas County Parks and Recreation Director. We do support this bill. We would very much like to have it pertain to rurals. I think one of the important things about it in the rural communities, and Lyon County is a perfect example, you have separate areas. For example, Fernley and Yerington that are 45 minutes or an hour away from each other as far as driving, and if you were able to implement some tax resources which stays within that area, then you don’t have county-wide tax resources going towards regional parks. For example, people in Yerington paying for parks in Fernley that they never use. This is a real good way to have the area that is being served by trying to serve that population actually being funded from that population, and not the rest of the county. So I think as far as the taxation issue, I think it’s a more equalized type of use. So we really do support this. I think it’s—a lot of times in the rurals we don’t have a lot of opportunities to build our parks, and I think this is a good opportunity to allow them to do so. Of course it is enabling, but it is one more tool for them, and they don’t have a lot of them in the rurals.
Assemblyman Grady:
Thank you. Mary, did you have a chance to talk to Commissioner Goodman?
Mary Walker:
No.
Assemblyman Grady:
He e-mailed me yesterday, and he has some concerns, and I think I answered his concerns. One of them is the big park, like 90 acres, that they are going to do in Fernley, and it is right on the border. It’s BLM [Bureau of Land Management] ground on the border of Lyon [County] and Washoe County. His question is how would this affect it if it was in both counties. The way I read the bill, Mr. Collins, if I may address you also, it’s the governing body, so I would assume that it would be the governing body of Lyon County who would be the one that would call the shots on it.
Mary Walker:
And they would only be able to tax within Lyon County. They can’t tax--
Assemblyman Grady:
You might want to touch base with him on that.
Mary Walker:
Sure, I will, and again, this is just enabling for them.
Assemblyman Collins:
You know, Mr. Chairman, with clarifying the intent—Do you have a heartburning issue? Mr. Chairman, you’ve got one more.
Russell Rowe, Attorney at Law, Kummer, Kaempfer, Bonner, and Renshaw:
[Introduced himself] We represent Focus Commercial Group in Las Vegas, [Nevada]. We just have a clarifying question really on non-residential construction projects. Is the intent of that to include all construction that is non-residential, including if you put up a fence or sign or any other structure that’s not habitable?
Assemblyman Collins:
If somebody’s not going to live under that fence, yes. If they are not going to live under that billboard sign that there’s too many of, yes. Did I help you?
Russell Rowe:
No.
Assemblyman Collins:
We are not going to tax the pigeons that reside on your signs, though. Just the building.
Mr. Rowe:
Ok, so any construction that’s non-residential would be taxed even if it’s not occupiable? Ok, so you have to get a permit even if it’s not an occupiable building?
Assemblyman Collins:
So if a billboard sign costs $20,000 you are going to pay $20. You guys can afford that.
Mr. Rowe:
That does clarify it. Thank you very much.
Chairman McCleary:
Is there anybody else that has a burning desire to speak? Step forward.
Rick DeMar, Executive Officer, Builders Association of Western Nevada:
[Introduced himself] I just want to reaffirm that we adamantly oppose this bill [A.B. 196]. We don’t feel that it is necessary, and it is another form of taxation. Briefly, that is what I have to say, Mr. Chairman. Thank you.
Chairman McCleary:
Thank you, Rick.
Assemblyman Collins:
Mr. Chairman, I might just remind you, as well as this Committee, we had a tour yesterday of Douglas County, and we met folks who had people walk up and sit on the porch of their home, thinking it was a park. We had people walking in and taking pictures of their cows and getting harmed by that, because they thought it was a damned park. You don’t have enough parks, obviously, and there’s no signage on them, or those people wouldn’t be walking on private property, would they? But we oppose parks. Thank you. Just more of my editorial.
Chairman McCleary:
If there is no one else that absolutely has to speak, we are going to close the conversation on that. Not that we actually officially opened it yet. Nobody else has any questions that we want to ask anybody else this morning? With that, what I’m going to do is ask, starting with Assemblyman Collins, some closing remarks and thoughts, after which I’m going to ask Mr. Grady the same, and then I’ll offer mine.
Assemblyman Collins:
Mr. Chairman, when you’re ready, I’d like to make a motion with the understanding of the intent of the language that was presented by this chart [Exhibit C] showing what the actual tax would be on a project. Clarifying some of the issues of multiple taxes, or multiple permit fees, and with that intent I think we have answered some of those questions, and I would also say that the primary, well . . . up until this morning, and I think that was clarified the other day, and I think this intent clarifies most of the opposition in southern Nevada. I think Clark County is where this needs to be passed with the—I say this based on the time limit of this session, and on the fact that we’re not going to get amendments out until March 24 or 25 as a starting point, and it might be the first part of April before we even get amendments out of the bill drafting because the issues of getting all of the original bills drafted by the 24th of March. Just the timeliness of this session, rather than trying to please people, I think we should go where the need is the most initially by recommending that this bill be amended to Clark County. And then when Washoe County’s bond runs out, they might want to come back and ask for it to be—legislation by then, or before. They could start tomorrow or whatever, but I think I feel really sad, because I can tell you from the fairgrounds in Yerington to the fairgrounds in Fernley is about an hour. And this would really benefit you folks up north. This would really benefit Lyon County. This would benefit Elko County. This would benefit even Eureka. Given that opportunity when some mining comes into those areas with some new development as a cycle that—Well, rather than say anything nasty, I just won’t say anymore.
Chairman McCleary:
Thank you, Mr. Collins. Mr. Grady.
Assemblyman Grady:
Thank you, Mr. Chairman. I will support, with the amendment that Mr. Collins offered, and I support parks 100 percent. My question the other day, and still, I look at it a little bit as how are we going to maintain these parks. I’ve been assured by many of the local governments that that would not be a problem. So, with the thought that they can maintain them, if Mr. Graves and Mr. Milliken’s questions, I believe, were partially answered, although I know they still do not like the additional taxes, but if it is reserved at this time for Clark County, I would support Mr. Collins’ bill with one question. Are you accepting Dan Musgrove’s amendment [Exhibit D] on the bill?
Assemblyman Collins:
Yes, I think that was ok with everybody. No, it wasn’t. Just reclarify neighborhood, that one sentence that he had in that. It doesn’t matter either way. No, we don’t have time for that.
Chairman McCleary:
Just for those, I don’t know who knows about this, but Dan Musgrove proposes [Exhibit D] the language should be changed on Section 3, page 2, detailing lines 7 and 8, inserting, taking out some language, inserting “neighborhoods, regions, or communities of interest, within the city or county.” I don’t think that is controversial. I want to make some of my reservations known. I live in North Las Vegas in one of the older communities. Matter-of-fact, part of my district, a quarter of my district, is in North Las Vegas. The other three-quarters of my district is in Las Vegas, but all of it is an older part of town. And something I’ve noticed over the years, I’ve lived there for 22 years, is the older communities don’t, their parks don’t get taken care of. And that is my real concern with this. The language in this says not only to maintain parks, but to establish new ones. And with the money that Las Vegas shows, they estimate they would probably get about $1.8 million. That’s not a lot of money. It wouldn’t be a lot of money to maintain it, much less to establish new ones. I don’t think it’s going to be a great burden upon the industry either. I believe in home rule as much as possible. The municipal governments are requesting this. They are the ones that want this, and I’m going to support their—Them having that ability to enable this, if they want, and that is something that you could take up with them. I will be looking at this two years from now to see what progress has happened. If they actually, in fact, have not maintained the parks that are existing presently, and I will make an issue of that because that affects my constituents. That is my concerns. I can support the Clark County only for now, and I can support Dan Musgrove’s language, and at this time I’ll entertain a motion.
ASSEMBLYMAN COLLINS MOVED TO AMEND AND DO PASS A.B. 196.
ASSEMBLYMAN GRADY SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
Chairman McCleary:
Is there anything else that the Subcommittee needs to do? I appreciate all of you showing up. Thank you so much for your participation. This hearing is closed.
RESPECTFULLY SUBMITTED:
Rosemary Zienter
Committee Secretary
APPROVED BY:
Assemblyman Bob McCleary, Chairman
DATE: