MINUTES OF THE meeting

of the

ASSEMBLY Committee on Judiciary

 

Seventy-Second Session

March 21, 2003

 

 

The Committee on Judiciarywas called to order at 8:10 a.m., on Friday, March 21, 2003.  Chairman Bernie Anderson presided in Room 3138 of the Legislative Building, Carson City, Nevada, and, via simultaneous videoconference, in Room 4401 of the Grant Sawyer State Office Building, Las Vegas, 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. Bernie Anderson, Chairman

Mr. John Oceguera, Vice Chairman

Mrs. Sharron Angle

Mr. David Brown

Ms. Barbara Buckley

Mr. John C. Carpenter

Mr. Jerry D. Claborn

Mr. Marcus Conklin

Mr. Jason Geddes

Mr. Don Gustavson

Mr. William Horne

Mr. Garn Mabey

Mr. Harry Mortenson

Ms. Genie Ohrenschall

Mr. Rod Sherer


GUEST LEGISLATORS PRESENT:

 

Speaker Richard D. Perkins, District No. 23, Clark County

Assemblywoman Dawn Gibbons, District No. 25, Washoe County

Assemblyman David Goldwater, District No. 10, Clark County

Assemblywoman Ellen Koivisto, District No. 14, Clark County

 

STAFF MEMBERS PRESENT:

 

Allison Combs, Committee Policy Analyst

Risa B. Lang, Committee Counsel

Deborah Rengler, Committee Secretary

 

OTHERS PRESENT:

 

Anthony M. Goldstein, attorney, Las Vegas, Nevada

Larry Spitler, Associate State Director for Advocacy, American Association of Retired Persons-Nevada (AARP), Las Vegas, Nevada

C. Joseph Guild, attorney, Reno, Nevada, representing Mobile Home Community Owners, Reno, Nevada

Steve Marzullo, attorney, Las Vegas, Nevada

David L. Howard, President, Gallo Nero Strategies, LLC, Reno, Nevada, representing the Northern Nevada Apartment Association and the Southern Nevada Multiple Housing Association

Misty Davies, representing Northern Nevada Apartment Association and Southern Nevada Multiple Housing Association, Reno, Nevada

Shelly Baker, Property Manager, ERGS, Inc., Reno, Nevada

Roberta A. Ross, The Ross Manor, Reno, Nevada

Natasha Larsen, representing Carefree Senior Living, Las Vegas, Nevada

Vicki Young, President, Northern Nevada Apartment Association, Reno, Nevada

Patricia Law, American Settlement Corporation, Gilbert, Arizona

Randy Dyer, Executive Vice President, National Structured Settlements Trade Association, Washington, D.C.

Matthew Sharp, Nevada Trial Lawyers Association, Reno, Nevada

Alfredo T. Alonso, representing the National Association of Settlement Purchasers, Reno, Nevada

Sue Germeroth, education advocate, Las Vegas, Nevada

James Kent, attorney, Las Vegas, Nevada

May Shelton, Consultant, representing Washoe County Social Services, Sparks, Nevada

Pam Becker, Organizational Analyst, The Children’s Cabinet Inc., Reno Nevada

Stu Fredlund, Social Welfare Manager, Division of Child and Family Services, Nevada Department of Human Resources, Las Vegas, Nevada

 

 

Chairman Anderson:

[The Chair reminded the Committee members and those present in the audience of the Standing Rules and appropriate meeting etiquette.  Roll called.]

 

There are ten present; a quorum is present.  Anyone arriving late should be marked as present.

 

Please note the sign on the [witness] table concerning the legality of misrepresenting facts before the Committee or the Legislature on any legislative matter which makes it a misdemeanor or gross [misdemeanor].

 

I am going to change the order of the business today, slightly.  We are going to hear A.B. 274 first so that we can send Assemblyman Goldwater back to finish the budgets.  So, please, turn your attention to Assembly Bill 274.

 

Assembly Bill 274:  Increases length of notice before persons 55 years of age or older may be evicted from certain periodic tenancies under certain circumstances. (BDR 3-1128)

 

Assemblyman David Goldwater, District No. 10, Clark County:

[Introduced himself.]  The reason I asked for your indulgence to go first is because in Las Vegas I have a constituent representative who, I think, can represent anecdotally the reason for A.B. 274.  If Mr. Goldstein is there, if you would call him up to the table.

 

Anthony Goldstein, attorney:

[Introduced himself.]  My involvement in matters relating to A.B. 274 began when I was contacted by Mr. Bill Goshen, a 67-year-old retired career army officer and 15-year resident of Las Vegas.  Mr. Goshen had received a 30-day no-cause eviction notice and contacted my law office to represent him in the eviction matter.  After realizing the effect of Nevada Revised Statutes (NRS) 40.251 as currently written and the effect it had on Mr. Goshen, I felt it necessary to write a letter to the state legislators who represent Mr. Goshen’s constituency.  Please note that the purpose of my letter was not to request any sort of assistance or intervention for my client, Mr. Goshen, involving the pending eviction matter.  Rather, I was simply calling their attention to the statute that continues, in my opinion, to cause a significant burden in the lives of many of the elderly constituents of Nevada, including Mr. Goshen.

 

Specifically, NRS 40.251 provides that “A tenant of real property, a recreational vehicle or a mobile home for a term less than life is guilty of an unlawful detainer when having leased…” when “the term of the rental agreement or its termination and, except as otherwise provided…the expiration of a notice of at least 7 days for tenancies from week to week and 30 days for all other periodic tenancies…”  This type of eviction for which this statute provides is commonly preferred to as a “no-cause eviction,” since the landlord may pursue this eviction even without just cause.  That is, once a periodic tenancy has been established, even though the tenant has not violated any of the terms of the rental agreement, the landlord may still evict him or her after the notice period has expired; in this case it was 30 days.  I do not dispute the underlying policies of the statute; as I understand, there are legitimate state goals that this statute promotes.  However, I do take issue with its application to elderly members of our community.  Thirty days is simply not a reasonable amount of time for an elderly person to locate a new place to live and to move his or her personal property from the previous residence to the new. 

 

Allow me to demonstrate the practical affect of the statute as applied to the case of my client, Mr. Goshen.  As I mentioned earlier, Mr. Goshen is a 67‑year-old retired career army officer who currently resides in a very modest studio apartment in Las Vegas near the intersection of Sahara and Valley View.  Mr. Goshen had been a model tenant of this facility, this apartment complex, for approximately four years when he all of a sudden received this 30-day no-cause eviction notice.  In Nevada, when somebody receives a 30-day no-cause eviction notice, the statute only provides four possible defenses to a tenant:

 

  1. Procedural due process, meaning they did not receive proper notice.  In this case Mr. Goshen did receive proper notice.  Fulfilling the requirement of proper notice is not difficult, it is merely providing them with a written sheet indicating that they are being evicted based on a 30-day no-cause eviction.

 

  1. The lease has not expired.  If the tenant had signed a lease for one year, and in the eighth month of the tenancy, the tenant had received a 30-day notice, then that would be a defense.  This never happens, a 30-day notice exclusively applied to when the tenant is in a month-to-month status even after a yearlong tenancy has been established.

 

  1. Eviction was retaliatory in nature.  If the landlord is trying to get back at the tenant for previous actions.

 

  1. If the eviction is being pursued for discriminatory purposes.

 

[Anthony Goldstein continued.]  In other words, unless one of the four aforementioned defenses is available, the tenant has no choice but to move from the residence after the statutory notice period has expired.  At this point, Mr. Goshen or any other elderly person in his position would be forced to find another apartment complex on this extremely short notice and to move all of his personal property into a new residence.  Though 30 days may be sufficient time and reasonable time for a younger more physically able person, it seems to me to place an immense burden on the elderly of our community.

 

In summation, NRS 40.251 as currently written creates an undue burden to the elderly of our community.  As such, I would recommend that the statute be amended so that the period of notice for those 55 years of age and older should be increased to 60 days as Mr. Goldwater has currently written in A.B. 274.  Thank you kindly for your time and your attention; I would be glad to answer any questions that any of you might have at this time.

 

Assemblyman Mortenson:

We are having a bunch of age-related laws; I see no reason why everybody should not get a 60-day notice.  It does not make a lot of sense to me to discriminate for age one way or another.

 

Assemblyman Gustavson:

Did Mr. Goshen give any indication as to why he though he might have been being evicted from this place after being a model tenant for so long? 

 

Anthony Goldstein:

Yes, in this particular case, how I defeated the two eviction proceedings that his landlord attempted to pursue against him was that it was a retaliatory eviction based on the fact that he complained to HUD [United States Department of Housing & Urban Development] about certain health conditions that existed around the property.  He actually sent a letter to HUD in September 2002, and he received his eviction notice on October 1, 2002.  Both evictions were defeated in Las Vegas Justice Court with me representing Mr. Goshen.  We are also pursuing action against the landlord under NRS 118A.590, which allows an action based on retaliatory eviction.  For this particular case we did have a viable defense; one of the four defenses I mentioned earlier was available.  But in my opinion, even if one weren’t available to a tenant, the notice period still should be raised at least another 30 days for the elderly members of our community.


Assemblyman Gustavson:

If we were to extend this to 60 days instead of 30 days, does that just give that tenant the option to not his pay rent for 60 days instead of 30 days; therefore the landlord would be out more money?

 

Anthony Goldstein:

No, the tenant would still be required to pay the amount of the monthly rent, whatever it may be.  The only difference it would make it would require the landlord to give the tenant an extra month’s notice prior to pursuing any eviction proceedings against them.  The landlord would not be out any additional money, and would not have to pursue any kind of small claims action to collect that money; it would just be a matter of forcing the landlord to decide an extra 30 days earlier whether or not the landlord is going to evict that particular tenant. 

 

Assemblyman Gustavson:

If the tenant should decide not to pay the rent once he received the 60-day notice, could a 5-day notice be submitted to him for not paying the rent at that time, then forcing him out earlier? 

 

Anthony Goldstein:

Absolutely, at any point under any lease agreement in Nevada, as soon as the tenant fails to pay or meet the obligations under the lease agreement, which is generally just to pay the rent, the landlord at any time could file the 5-day notice.  But once again, that is a different type of eviction than a 30-day no-cause eviction.  Assembly Bill 274 is merely addressing, as I understand it, the 30-day no-cause eviction provision, not the standard 5-day non-payment of rent provision.

 

Assemblyman Geddes:

Beyond this case, how often do you see this occurring?  I mean, this is an interesting example, but I have never heard of this issue before.  Granted, I don’t hear about a lot of issues, but it doesn’t seem that it is that big of an issue, or that there is a big outcry for this.  I am just wondering how often this does happen.

 

Assemblyman Goldwater:

It happens more often than you think.  A member of this Committee works at a firm in Las Vegas called Clark County Legal Services and the reason you don’t hear about it is because these are the silent minority of people that rely, I have always thought, on us to represent them.  The district I represent at one time was upwards of 70 percent apartments.  Most of the time the relationship between tenants and landlords is a good one, but every now and again you look at a landlord or property manager, more likely, that rules with an iron fist and is relatively unreasonable.  In those cases, you will find that the stories are sad stories, and they look to the statutes to protect them.  It happens more often than you would think.  It depends on where you represent, where you live, and where it is occurring.  But it is occurring quite a bit in southern Nevada and particularly in recessionary times, when homeownership is down, rents seem to go up, and incomes are down.

 

Assemblyman Geddes:

Do you see it happening more with the people over 55 [years of age] or is it more of an income-based issue?

 

Assemblyman Goldwater:

Just to build on what Mr. Mortenson said and your question too, Mr. Geddes, I have done tenants’ rights bills before and I have been roundly defeated.  But we have improved NRS 118A over the course of time to be reasonable.  The 30‑day no-cause [notice] in Nevada is there for a reason.  I do not intend to change the 30-day no-cause [notice] because that is the policy that this state wants to adopt; I will settle for the reasons that it is there.  For people 55 and older, or older people, everything we do, as we get older, I know I am not nearly as fleet of foot as I use to be, I know when I move it’s a long arduous process.  I cannot imagine doing it with any sort of disability.  It is getting more and more difficult as I get older.  Senior citizens have unique needs, transportation needs, just finding a pal to help you move, [and] income needs that are restrictive.  I have always felt the 30-day no-cause [notice] was something we could improve on, we aren’t going to.  Let’s at least say for this state, if you are above a certain age, we will give you a little extra time.

 

Chairman Anderson:

Quickly, we have quite a few people who want to speak on the bill, and I want to try to give everybody an opportunity.

 

Anthony Goldstein:

Another issue is that many of the senior citizens live in communities and desire to live in communities that are specifically designed for those 55 and older.  Therefore, the pool of possible residences is tremendously limited, particularly those of limited financial means, to those 55 years or older who specifically desire to live in a place, a community, that’s limited to those 55 and older.  That creates an extra difficulty and requires extra time to find such a suitable residence.


Chairman Anderson:

Mr. Goldwater and Mr. Goldstein, being over 55 years of age myself and clearly in the category that applies, the question is, if we are really trying to protect that particular group, that segment of the population that may have difficulty with moving, would it not be better to, if you are trying to create this, look toward those people who have disabilities or infirmities rather than a “bright mark” age of 55?  I noticed on my agenda, I have someone who wishes to speak who might consider 50 [years] to be the magic age for it.  Why would we not, if we are going to extend this, include those people who may have some other kinds of disabilities, who may have a difficulty of trying to find and relocate to better lodging because they may be discriminated against in some way?

 

Assemblyman Goldwater:

I think the reason is that age is an objective determinant.  Disability is at times a subjective determinant and at times something that can be disputed.  We see it often in the caseworker’s office, but age was something here that we said was an objective determinant.  You are either 55 and older or you’re not. 

 

Larry Spitler, Associate State Director for Advocacy, American Association of Retired Persons-Nevada (AARP):

[Introduced himself and provided a written statement (Exhibit C).]  We are here today to lend our support to A.B. 274.  Housing affordability remains a major problem for many older people, especially those who rent.  For many older renters, high rents and low incomes add up to high housing cost burdens.  A late 1990s report indicated that 55 percent of older renter households incurred excessive expenditures for housing, with excessive defined as housing costs in excess of 30 percent of income.  The affordability crunch experienced by older renters is part of a larger affordability problem, affecting renters of all ages who have low incomes, particularly those with very low and extremely low incomes.

 

In addition, the nation’s housing stock may prove inappropriate as the population ages, especially for those people experiencing increased frailty, catastrophic illness, or sudden unexpected loss of work.  With that as a background, we thought of the monumental logistical pressures that must be facing older persons experiencing eviction from their homes.  As was indicated in earlier testimony, it is not always easy to find new housing, there is always the question of transportation, packing, the process of moving from one location to another, and all the additional new expenses associated with deposits on new housing.

 

Looking at just a few of those questions makes it easy for others and us to support A.B. 274.  Many seniors do not have the close circle of friends they once had when they were healthy, strong, and willing to assist them when they moved.  Consequently, additional time is warranted.  We encourage the Committee to look favorably on this measure. 

 

In conclusion, with a different hat on, at one point when I was in the Legislature, my district went right up against Assemblyman Goldwater’s district.  I can tell you that this occurs far more often than what is documented or what is documentable.  Seniors frequently just simply accept these things and do the very best they can in finding new housing.  Thank you very much for the opportunity to share these thoughts with you and to support this bill.

 

Chairman Anderson:

Any members of the Committee, questions for Mr. Spitler?  Anybody else in the south wishing to speak in support of the legislation?  Anybody here in the north in Carson City wishing to speak in support of A.B. 274?  Mr. Goldwater, it appears I have quite a few people on the other side of the question.  

 

Assemblyman Goldwater:

I appreciate the Committee’s indulgence and consideration of A.B. 274.  It seems reasonable to me.

 

C. Joseph Guild, attorney, representing Mobile Home Community Owners:

[Introduced himself.]  In the south is a colleague of mine, Steve Marzullo, an attorney and practitioner in this field of mobile home tenancy.  I put down on your sign-in sheet that I was against this bill, and when I heard the testimony in favor of it, the reason you saw me come up and talk to Mr. Goldwater was that I realized, or at least I think, that this bill is not intended to deal with the area of mobile home park tenancy/eviction situations.  Under NRS 118B, which is the landlord/tenant law related to mobile home parks, there is no provision for a no-cause eviction.  If a mobile home is owned by a mobile home park and it is rented to a tenant in that mobile home park, there is a provision, or it would be subject rather to a no-cause eviction if the landlord decided to do that. 

 

Where a mobile home is owned by a tenant and that mobile home is located on the real property owned by the landlord in a mobile home park, the eviction procedures are governed by NRS 118B, not NRS 118A.  In so far as, or as long as, A.B. 274 does not inadvertently draw into its provisions the eviction proceedings governed by NRS 118B, we do not oppose A.B. 274.  However, if that happened, in some inadvertent way, we would have to draw the distinction because mobile home park tenancy is different than apartment tenancy.  With that, I would like to “toss the ball” 425 miles south and see if Mr. Marzullo can catch it.


Chairman Anderson:

Mr. Marzullo, Mr. Guild hypothesizes that this may not apply to mobile home parks.

 

Steve Marzullo, attorney:

It is more than a hypothesis, I believe it is absolutely the law under NRS 118B.200; we have express statutory language that prohibits a mobile home park from engaging in a no-cause eviction.  That’s an important determination… the other attorney before me… those terminations or evictions premised on nothing more than the fact that the tenancy has expired.  Now in mobile home parks, the vast majority are month-to-month tenancies.  Nonetheless, a mobile home park landlord is not permitted to initiate such a termination just simply based on the termination of the tenancy under the express language of NRS 118B.200. 

 

That being said, however, and now understanding the laudable goal that is trying to be achieved here, that is, to give seniors…  I agree with the other Assemblyperson, it should be broader than seniors.  I probably process 300 evictions a year, and an equal hardship, perhaps even more, occurs in the no-cause eviction when you have families with school-age children.  As you can imagine, their schools, their locations become very problematic.  Briefly I would like to suggest, this to the Committee.  Initially, trying to create a different statutory period for notice could be attacked legally as discriminatory and violative of the Fair Housing Act, which is also implemented by NRS 118.  In other words, you cannot create two different notice periods or unequal protection, one for seniors and one that does not apply to families, in my opinion.  If you do that clearly, members of legal aid representing a family, when given a 30-day no-cause eviction, would argue that they are entitled to the same treatment under the law as seniors.  I think they would prevail. 

 

That being said, I do think, as a practical matter, that the courts and landlord attorneys down here in the south are accommodating hardships for no-cause evictions.  It happens all the time.  The way you accommodate it, rather than increasing the notice period, I would strongly suggest that you go into NRS 118A and vest the court with discretion to extend entry of either summary eviction, summary orders, or writs of restitution, in those events where it can be shown the landlord’s rent is being paid, no breach of the lease is occurring, and circumstances exist relative to relocation for seniors and/or families, thereby overcoming the constitutional hurdles.  I think that such an approach would implement the policy that Assemblyman Goldwater is trying to accomplish. 

 

I think it would also overcome any kind of constitutional arguments because it not only applied to seniors but other households with family members.  And it would merely do what the courts are already doing when a tenant comes before a judge and says, “I need more time to move.  I have to find another place.”  As a practical matter, the courts are almost invariably allowing that, especially when the tenants are willing to pay the rent and the landlord has no other reason other than  he is closing down the building or whatever would precipitate a no-cause eviction.  Hopefully, that approach would be more helpful.

 

Chairman Anderson:

You are indicating to the Committee that we should take a much broader “swack” at this then the narrow confines that Mr. Goldwater has suggested, and you raised constitutional issues.  Of course, the reason I hypothesize is because I have legal counsel on my right who will tell me whether that is correct or not.  Have you thought about putting your information in writing for us so that if we proceed with this bill we might be able to see some hard copy?

 

Joseph Guild:

We would be happy to present my remarks and Mr. Marzullo’s remarks on behalf of our client in writing to the Committee and any other help we can provide to accomplish Mr. Goldwater’s goals.  We would be happy to provide that too.

 

Chairman Anderson:

Questions for Mr. Marzullo or Mr. Guild from members of the Committee?

 

Assemblyman Horne:

Your suggestion of attacking this through the statute NRS 118A, are we asking the tenant to go to court to ask deference of the judge for this relief when we can accomplish that right now in statute?  It would seem that would add an additional burden on the time when someone is asking him to change their home and the like.  Also, we already have overburdened courts as well; it seems like we are just adding another layer to their problem by doing that.

 

Steve Marzullo:

Absolutely perceptive on your part, it certainly would create another layer.  You are correct; we have to be intellectually honest, but I think it is important to balance all interests.  To just automatically create a burden on landlords or property owners without a judge having some type of discretion to make sure that the equities are balanced on both sides is manifestly unfair.  I do not think that extra procedural burden is much, especially when you understand how the summary eviction process works.  It is a mere piece of paper that is filed to create a hearing.  It can be very informal, and the system works very well.  Again, judges, as a practical matter, are doing this all the time.

 

Assemblyman Horne:

But generally it is not uncommon for a public policy to give deference to our seniors in certain circumstances.  When weighing burdens, looking for equity, don’t we generally look to see who is best able to bear that burden?  In this circumstance if we’re talking that the tenant is still paying the rent during this time they are seeking new accommodations, the landlord is not out much other than another 30 days of continuing getting the rent.  What would be the harm in that?  What additional burden would that be adding to the landlord that would require us to add this other layer, to instead go to court? 

 

Steve Marzullo:

I think it’s simple.  I think creating the 60 days up front would not change the fact that the resident—and again I think I need to go backwards.  To suggest that we continue to implement policy that favors seniors over familial households would be incorrect.  In fact, I think we have all had to take a couple of steps back.  Once again, I reiterate, the Fair Housing Act, which was made part of NRS 118, prohibits any discrimination based on familial status.  The whole idea of adult parks, for example, or even senior accommodations, has strict limitations now because of the federal law and state law.  The policy objectives that reward seniors and don’t equally treat families are under strict scrutiny and, I think, subject to attack.  That would be the first thing I would challenge about what you are saying. 

 

That being said, though, creating 60 days on one side on the notice period, would open up the argument clearly that to other tenants, they are entitled to same 60-day period, and then once we do arrive at court, or once we do try to terminate, then they would ask for more time.  I think as a practical matter, just simply vesting the courts with the discretion that they already are exercising to protect seniors and families, I mean, again, I don’t see this, especially in my experience where I am processing at least 300 evictions a year, that seniors are being victimized by no-cause evictions.  What I see, more often than not, are seniors being victimized by members of their own household.  I just process that many of them, that no-cause evictions promulgated against seniors are not the norm; they are very unusual, at least in my practice.

 

Assemblyman Sherer:

I have a question on the physically or mentally impaired persons, is it also an issue with them as far as these notices also, especially since Mr. Goldwater brought up about the fact of moving and getting 60 days?  Do they have that same issue?


Steve Marzullo:

Indeed I think you are very correct, and any discretion to ameliorate the effects of a no-cause eviction should encompass all members, households with disabilities, seniors, and/or family status.  I agree it would have to be even‑handedly applied.

 

Assemblyman Goldwater:

Mr. Marzullo, there are some wonderful legal minds, in fact, one of the best legal minds in here is Ms. Buckley [on the Committee], who is not here, relating to landlord/tenant stuff.  But I will tell you as a matter of practical purpose, Mr. Spitler identified it perfectly.  For every one of these eviction cases that actually makes it to court, there are 10 or 15 others, more I would say, that never get that far.  What they get is a note on their door that says, “You have 30 days to move.”  All I am saying in this bill is as a practical matter and, Mr. Marzullo makes good points, and I think tenants’ advocates makes good points as well, but if you’re a little bit older, that note on the door says, “60 days,” and then they move in 60 days.

 

Chairman Anderson:

I appreciate you coming back up and trying to argue the importance of your bill, Mr. Goldwater.  Questions for Mr. Guild and Mr. Marzullo.

 

David L. Howard, President, Gallo Nero Strategies, LLC, representing the Northern Nevada Apartment Association and the Southern Nevada Multiple Housing Association:

[Introduced himself.]  We are here this morning, Mr. Chairman, in opposition to A.B. 274.  I would like to put on the record we have, both the Association in southern Nevada and the northern Association, worked with Mr. Goldwater now for three sessions, and we want to say how grateful we are for some of the things we have done in the past three sessions.  He has been gracious and understanding.  This is a very difficult subject for the Legislature to work on, and I just want to put it on the record that we are grateful for his past help.  We have indicated to him already that we are willing to work with him on this bill.  However, we do have some concerns and we want to put those on the record this morning. 

 

In skiing terms, this bill is a black diamond.  We are concerned about getting into the area of law; we have had some legal testimony already this morning that proves just exactly what I am trying to say here.  You open this area of the law up, you’ve got lots of concerns, and you have lots of legal opinions.  We would rather not get into that area.  The 30-day no-cause [notice] has been put into Nevada law for a very important reason.  It has been debated here for almost ten years that I am aware of; I don’t want to go into that this morning.  We just want to talk specifically to this bill. 

 

I think points have been made already that this is discriminatory and it is going to cause some practical problems for those people who operate and own properties for rent.  I will close with just this, seniors, and I think I can speak for seniors, really are a stable product for people who own and manage properties.  These are people who are stable, pay their rent, and very seldom is there a cause for an eviction.  We talked about no-cause [evictions] and I think we are going to have some people talk to you this morning about the other side of that coin.  I will close now and I would like Misty [Davies] to read into the record just a short message from a lady in Reno.  [Mr. Howard submitted Exhibit D, a statement from Scott Brenneke, without further testimony.]

 

Misty Davies, representing Northern Nevada Apartment Association and Southern Nevada Multiple Housing Association:

[Introduced herself.]  I have a letter here from Judy Cook (Exhibit E) of Cook Company Limited in Reno, and it says she is opposed to bill A.B. 274.

 

This bill proposes to double the length of notice time required by a landlord who wishes to terminate a month-to-month tenancy.  As the bill is written, it would affect both residential and commercial real estate properties.

 

·        The month-to-month rental contract, whether residential or commercial, is intended to be a bilateral contract, with rights to terminate being equal between both parties.

·        A requirement that gives the landlord greater notice than is required of the tenant to terminate places an unfair burden on the landlord.

·        The requirement that a landlord somehow determine the age of the tenant, whether residential or commercial, before giving notice to terminate the tenancy places an additional unfair burden upon the landlord.

·        The provisions of this bill may be considered discriminatory in nature, using age as a basis for determining the terms of a contract.

 

Shelly Baker, Property Manager, ERGS, Inc., representing the Northern Nevada Apartment Association:

[Introduced herself.]  I am against this change, as well.  Currently, under NRS 118A.220, “Rental agreements: Prohibited provisions,” the statute makes an indirect reference to the fact that a renter shall give a no-cause notice to move, which is the same as a landlord’s no-cause notice to move found in NRS 40.251.  Contractually, my view, a month-to-month contract means a series of 30-day terms.  A 30-day notice is the term of a month-to-month contract. 

 

A change to a 60-day notice to move would essentially change all senior citizen contracts to a series of 60-day terms.  This would be confusing and burdensome to single out a group of people based on their age and treat them differently from everyone else.  Misty Davies’ letter (Exhibit E) made a reference to how would we determine the age of these folks.  On a rental application, that’s an optional question, we cannot ask that.  They can provide it, but we cannot ask it.  The way the law is written under NRS 40.251 is fair and equal to residents and landlords.  The renter can give a 30-day notice to move and the landlord can give a 30-day notice to move.  I believe this bill draft before us today is being used as a back door to circumvent the 30-day notice to move.

 

I ask you, and the question has been posed several times before, why make an exception to senior citizens?  Why 55 years or older?  What if a senior is disruptive to the community?  Bad behavior is not exclusive to the younger generations.  Why not an exception for single parents?  Why not an exception for major medical illness? 

 

I have used a 30-day no-cause [notice] once in the last year, and I oversee almost 600 apartments.  The local justice court judge would not grant me the eviction on non-payment of rent because every time we got before this particular judge in court, the folks had the money to pay.  I gave a 30-day no-cause [notice] because of these folks’ inability to pay the rent every month for the year; I was filing a 5-day “payor quit on rent.”  It is a huge burden to take up our court’s time to go through this.  I urge you to keep this fair.  A 60-day notice to move, if we put it across the board when buying a home for anyone, a senior or otherwise, is a long period of time.  Moving out of state, a 60-day notice is a long time. 

 

Chairman Anderson:

Ms. Baker, I was under the impression that if somebody was causing problems in your area, was disruptive to the property in some way or to the overall, that would be cause for action to have them removed, and thus would not fit under the 30-day [no-cause notice] and would be reason for termination.  I have to say I am not big into this discussion; however, I have been through it a couple of times now.  The no-cause action was generally predicated by  some other reason than the right of the owner of the property to have control of his property just as the tenant does, and that was why the 30-30.  But if you had a disruptive person, would you not be able to have them removed anyway? 

 

Shelly Baker:

Yes, there are other statutes available to proceed under.

 

Chairman Anderson:

So then this would not apply.

 

Shelly Baker:

No, sir.

 

Chairman Anderson:

If someone does not pay their rent, then you can remove them, obviously.

 

Shelly Baker:

Yes, in this particular circumstance where I had filed a 5-day payor quit, every month, I did not bring a ledger and maybe I should have to present before this body, they were paying their rent late every month, I was filing the 5-day payor quit through the justice court, it was going to the lock-out stage, they would come and have the money at the last moment.  The way the law is written, they can pay the rent, they did before the judge, and I was not getting relief.  They were not following the contract.  Do you see what I am saying?  Every month they put the court under this burden, so what I did was give them a 30‑day no-cause once that lease was expired because they could not afford it.  I do not know what their issues were, but it needed to change.

 

Chairman Anderson:

Just as a good business practice, if you had followed this 30-day rule, if I were in your business and I had somebody who did that two or three times for me I would give them notice and then give them the 30 days if they happened to be over 55 or I had reason to believe they were over 55.  I think Mr. Goldwater is asking us now that it would be extended, but they still have to make the payment because if they don’t make the payment then they are gone.  I am a little confused in part.  You are the person who does this, am I not following the steps to go through?  Wouldn’t you get them out anyway when they don’t pay?

 

Shelly Baker:

Yes, but they are given an opportunity up to the end of this process to pay the rent, which stays the eviction.

 

Assemblyman Conklin:

I have a small point of contention, if we set age aside and many of the other things we have talked about, and we just talk about 60 days for a moment, or 30 days.  There is a big difference between 30-day eviction for cause and a 30‑day no-cause [eviction].  Let me give you an example.  You had mentioned that in most contracts you have a termination right of 30 days, particularly in a month-to-month contract.  I have been a tenant of many apartments in my lifetime, as I am sure other members of the Committee have.  We notify an apartment for 30 days but we may have taken the previous 60 days to find suitable housing, maybe waiting for a house to be built.  When this 30-day no‑cause eviction notice comes in, all of those steps we would have taken cannot be done in 30 days.  You cannot buy a house in 30 days, very rarely unless you are paying cash, and even then it is a struggle, particularly in Las Vegas.  I disagree with your comment that 30 days is ample time, particularly if it is a surprise for those folks, and it should not be surprise if they are not paying their rent, if they are violating the contract in other means.  Just a little point of contention; if you have a comment on it.

 

Shelly Baker:

My comment would be is that I am imploring you to keep this fair.  Sixty days or 30 days by either party, whether no-cause or not.  If we are going to change the terms of a contract from month-to-month to 60-day terms, I might be misunderstanding what this evolving into.  That would be my point; if we were going to be going in the direction of 60 days, let’s do it across the board.

 

Roberta A. Ross, owner/operator of The Ross Manor:

[Introduced herself.]  I am a landlord and the owner/operator of a 162-unit residential hotel and apartment in downtown Reno.  We do both weekly and monthly rentals.  Out of the 162 units that I have, 58 of them are seniors which we usually approximately carry 40 percent seniors.  The majority of those seniors have lived there for 5 to 20 years.  The other 60 percent is comprised of residents under the age of 55, tenants with disabilities, veterans, students, casino worker families, and retired persons who are also under the age of 55 years old. 

 

The previous statements that have been made against A.B. 274, I will concur with and will not go forward and repeat.  One of the questions that I do have is that, when you look at an unlawful detainer and a cause and for no-cause is that one of the things that I would want to make sure that the term “unlawful detainer” does not include a for cause eviction.  When you have someone that is for cause evictions, we would like to have it say it like it is now.  As proposed, if you were to give someone 55 years or older a 60-day cause to move, there is an element of destruction that has not been addressed here.  When you give a person a no-cause to move, they are usually not happy about it and there is a destruction period in your apartments at that time that could very well fall into that, and to push that out to 60 days would make a hardship on the landlord.  It is a point that I would like for all to think about.  The age situation that was brought up is also very difficult; where will we fall in fair housing and what laws will we be crossing over at that time?

 

I do not want to repeat what was said, I do concur with it.  I believe that there are seniors out there and the age of 55 is kind of puzzling to me that will make our situation much worse to spread it out for 60 days.

 

Assemblyman Conklin:

Can you explain to me what just reasons you have for a no-cause eviction?  Give me some examples.

 

Roberta Ross:

For a no-cause eviction?  A no-cause eviction is common if you are going into a certain part of a building to repair it.  I have a building built in 1907, it’s not…a no-cause is just that, it is a no-cause.  You don’t come up with reasons for your eviction.  It is no-cause, that is what it goes for, it means exactly that term.  If it were for cause, we would go to the other side.

 

Assemblywoman Buckley:

I have not practiced law in this area for a long time.  The other time you would use a 30-day eviction is if you don’t want to use the 3-day nuisance or 5-day lease violation and go through the burden of proving it.  You just skip that and do a 30-day no-cause.

 

Assemblyman Conklin:

I have a concern about taking away somebody’s dwelling for no-cause.  It is just a personal matter, I guess.

 

Chairman Anderson:

We currently allow that again because if they are going to remodel, as Ms. Ross has indicated, if they are going to remodel a section of the building and they want to make sure that anybody is not in that particular section.  Maybe they are going to change one apartment into two or something.  I guess it would be a change in physical structure, maybe a changing two apartments into one.  Those things would possibly happen. 

 

Anybody else, questions for Ms. Ross?  I need to move to the south for those people down there waiting and indicated on the sheet that they wanted to speak against A.B. 274.

 

Natasha Larsen, representing Carefree Senior Living:

[Introduced herself.]  We have over nine communities that are 55 [years of age] and older, with a total of over 2,000 apartment units.  [Ms. Larsen read a prepared statement (Exhibit F) from Carrie Barone, Vice President, Carefree Senior Living.]

 

We respectfully submit our opposition to A.B. 274 as presented.  As a 55-plus senior housing provider who does not offer assisted living, our stance is that a 60-day notice would not be in the best interest of our residents.  Service of the existing 30-day notice typically transpires as a need for the resident to relocate due to health issues.  Quite often, our residents are challenged by diminishing health.  Either they have no family members to assist them, or their family won’t assist and we, as managers, are placed in an awkward position.  It is at times like this we involve the Adult Protection Services and/or the Nevada Division of Aging, who will assess the resident and determine their ability to care for themselves. 

 

Frequently, the resident is resistant to this recommendation and this is when the 30-day notice to terminate or no-cause [notice] is served.  This entire process usually transpires over 3 to 6 months.  The resident in the meantime is at risk of injuring themselves or others until they receive the care they deserve and require.  Prolonging this notice to 60 days will enhance their risk and puts our residents in harm’s way.  Therefore, for the health of our seniors, we ask that you deny A.B. 274.

 

Chairman Anderson:

I am a little concerned about how—you don’t think that, you believe that you speak for your residents of your apartment program?  This is not in their best interests to go for 60 days?  I want to make sure that particular point is clear.  Not in your best interests, but theirs.

 

Natasha Larsen:

It is in their best interests not to extend it to 60 days.  Often because of the fact their health diminishes so quickly, that if they are left alone in an apartment for 60 days with no medical attention, because, again, we don’t offer assisted living, then oftentimes we find that they can’t cook for themselves, care for themselves, oftentimes they are requiring additional assistance with medications.  Our staff is not licensed to do this.  Therefore, when we have no family members or they are against moving, because often, they are denying the fact that they need further assistance and they don’t want to admit that is has come to that.  But if you leave them in apartment for 60 days, they are put in harm’s way because they honestly can’t care for themselves and then we do have to get Adult Protective Services and Nevada’s Division of Aging to come in to assist us to get them out quicker because they do need medical attention.  It often does take 3 to 6 months as it is to get them assessed and because of that it is even more crucial that we are still allowed to have the 30-day notice to get them out and get them to a proper assisted living facility.

 

Chairman Anderson:

Is there anyone else in the south that intended to speak but did not check the right box?  I don’t want anyone in the south to feel that they did not get a chance to speak.

 

Vicki Young, President, Northern Nevada Apartment Association:

[Introduced herself.]  As the bill is written, I am opposed at this time to A.B. 274.  It raises the question of putting the landlord in the position of looking at age, which right now we are unable to do.  We have many fair housing laws that we have to abide by, I believe that this will be constitutionally challenged, and if we are going to be fair, let’s just make it fair for both sides.  If indeed we need to make a change, make it fair both ways, take out age discrimination, take out special needs, because those are protected by ADA (Americans with Disabilities Act) and HUD.  We have strict guidelines that we have to follow every day.  So I think the question needs to be, do we just go to an across-the-board 60-day notice on both sides?  That would be my suggestion today because it looks like many members of the Committee have quite a few questions and are very concerned about the 30-day no-cause [eviction notice].  I do believe it needs to be fair on both sides; I do believe if you go with age, it will be challenged.  There will be a lot more time spent in court because of the decision on age.  So let’s find a solution and work together with Mr. Goldwater on finding a different avenue to where people feel it is fair for both sides, whether it be 60 days or 30 days.

 

Chairman Anderson:

Ms. Young, were you here when Mr. Howard spoke?  [Ms. Young replied affirmatively.]  You did not think he made his point?

 

Vicki Young:

I felt it needed to be reiterated.  It was not strongly made.

 

Chairman Anderson:

Let me try to explain.  The point is made once.  The Committee has now heard it three times from your Association and this is not a good move.

 

Vicki Young:

I apologize if I have taken longer.

 

Chairman Anderson:

Anybody who has an issue that has not been addressed?  Let me close the hearing on A.B. 274.  And move to the next bill on our agenda, A.B. 166.  Let’s turn our attention to A.B. 166

 

Assembly Bill 166:  Makes various changes concerning transfer of right to receive payment pursuant to structured settlements. (BDR 3-231)

 

Assemblyman David Brown, District No. 22, Clark County:

[Introduced himself.]  Assembly Bill 166 deals with structured settlements.  I received a telephone call from Patricia Law, who sits to my left, who requested that I bring this legislation.  I can tell you, after I had a chance to speak with her and look over the issues, it was something that very rapidly and readily, I happily embraced.  I have Ms. Law here to testify, as well as Randy Dyer, who is the Executive Vice President of the National Structured Settlements Trade Association (NSSTA).  While I was excited about this because it is a bill that I think, as I described it, all of the good and none of the bad.  It is an excellent bill.  I think the Committee will be pleased to hear it.  They have come from afar.  I was excited to really lay out the arguments but since they have come from afar, and as I indicated to the Chairman, I have a telephone conference call at 9:30 a.m. that a judge invited me to participate in, and I wish to comply with that, I think that Ms. Law and Mr. Dyer will more than adequately present the details and facts and so would like to, Mr. Chairman with your indulgence, turn it over to Ms. Law.

 

Patricia Law, American Settlement Corporation:

I am a structured settlement professional and I have been in the business for about 16 years, I have been working in the state of Nevada for about 10 years, and I am a resident of the state of Nevada.  The main thing about structured settlements, a real quick overview on what they are and how they are helpful to society.  In a personal injury claim with catastrophic illnesses, we supply a product known as periodic payments or a structured settlement instead of giving a total lump sum to the claimant.  In these instances, many times they are severely injured and they need this income to continue living and keep their families together.  In this instance, all of these payments would be tax-free to the individual.  We work directly with the victims as well as with the defense side, and the interesting thing about this bill is, right now everyone is on the same page:  the Nevada Trial Lawyers Association, the American Insurance Association, the Alliance of Insurers, and hosts of disability groups.  In other words, it is a good bill; it’s for the benefit of the public. 

 

Assemblyman Brown and his co-sponsors brought this important legislation regarding this issue because we are going to try to safeguard the catastrophic injury payments to these people, instead of the factoring companies at this point, which is what we term them.  They have the capability of going to these claimants and Mr. Dyer has handed out a statement (Exhibit G) on the victims.  They become victims because they go to them and request that they factor their monies.  In other words, they say, “We will give you a lump sum for your future periodic payments,” and many times it is a pittance compared to what they would be getting otherwise.  The factoring is a national problem and the NSSTA has been involved in most states working on this problem. 

 

Randy Dyer, Executive Vice President, National Structured Settlements Trade Association:

I have provided you with some background information in the form of a handout (Exhibit G), I would direct you to the article that appeared in the U.S. News & World Report in January 1999, in which you can see some of the people who have been victims of factoring companies in the past.  The first picture you see is Jerry Magee, a Mississippi workers’ compensation recipient.  All 50 states severely restrict or prohibit the sale of workers’ compensation payments, and yet factoring companies have been going around attempting to buy these payments from people. 

 

Christopher Hicks, a teenage quadriplegic, lost all of his money he lives on to these factoring companies. 

 

The third person is Raymond White; let me stop on Raymond White for a moment.  Raymond White is a homeless person living on the streets of New York for seven years who was involved in a tragic accident in which he lost a leg.  In the settlement of that claim, Mr. White received structured settlement payments extending over his lifetime.  With that money, Mr. White turned his life around.  He has an apartment in New York, he is married, and he has a four-year-old child.  Unfortunately, he also has an eighth-grade education, and when the factoring companies descended on him over the course of five transactions, they took everything that he has.  Raymond White now lives on the charity of Abyssinian Baptist Church of Queens. 

 

The last picture is Davinia Willis, a teenage paraplegic. 

 

Let me explain how factoring works.  Let’s assume that you were receiving as a result of a catastrophic injury, for purposes of this example, $2,000 per month for the rest of your life.  That money would be guaranteed by a triple-A rated insurance company, you would receive that money, and with that money as Ms. Law said, you could hold your life and your family together.  Let’s assume that for some good reason you wanted to cash in some of those payments, take an advance on some of those payments for some worthwhile purpose.  The factoring companies would come to you and say they don’t want to buy your whole payment, they just want to buy $500 of your payment.  You sign this 20-page contract that they offer you, and they are going to give you a lump sum.  In exchange for that lump sum, they take $500 a month of your $2,000.  To do that, they ask the company paying you the $2,000 to send the check to the factoring company.  As part of the contract, they take the right to cash your check.  They take $500 and send you the $1,500. 

 

Now, you have been receiving your $2,000 on the 1st of the month.  Now the factoring company receives it on the 1st of the month and sends you your $1,500 on the 5th of the month, the 6th of the month, the 8th of the month, the 10th of the month.  With each delay they put economic pressure on you.  When you call the factoring company to say, “Where’s my money?” they say there are problems; the check was late, this and that.  Over time, they have put enough economic pressure on you that you have gotten yourself in debt.  So they say, “Maybe you would like to sell a little bit more of your payment to me.” 

 

As part of the 20-page contract, they have taken the right of first refusal against you selling payments to anyone else.  On the first deal, you could talk to a number of factoring companies, and they know that, so they have given you the best deal that you are probably ever going to get.  They still may have given only 80 percent of the worth of the payments; that’s a good deal in this world.  On the second transaction, they are not going to be so nice to you.  Now they are only going to give you half of what it’s worth, on the third deal maybe 20 percent of what it’s worth.  We have seen cases in which people have received as little as 13 percent of the value of the payments they have sold.  These transactions are outrageous.  We have provided you a list of the 35 states that have taken action against this.  In January of last year [2002], the federal government enacted legislation.  What you have before you is a bill that will put the rules behind these transactions back in the hands the Nevada court system, which is where we think they belong.  This is an excellent bill that Assemblyman Brown and his co-sponsors have brought before you.  I would be happy to take any questions that you may have.

 

Assemblywoman Buckley:

What ends up being the value that the consumer gets?  Is there a set amount in here?

 

Randy Dyer:

There are no fixed amounts.  The way the bill works is, the factoring company has to provide to the person interested in selling payments a disclosure, first and foremost.  The disclosure would include the true present value of the payments that are being sold, as derived using a federally mandated discount rate for that purpose.  The federally mandated discount rate is the rate used to evaluate all annuities, so that the individual can compare what they are getting with the true present value of the payments. 

 

Assemblywoman Buckley:

How is an everyday consumer able to, what does that actually look like?  Truth and lending uses an APR; how does this look like to a consumer?

 

Randy Dyer:

There is a list of, if you look at the bill, disclosures required under the law.  What it would look like, it would simply say, “Your stream of payment you are worth is $X” using the federally mandated discount rate.

 

Assemblywoman Buckley:

And what you are getting is this [amount of money].

 

Randy Dyer:

And is that a good deal for you.  So, the individuals can make some decisions for themselves in this realm.  All this material is then brought before a judge and the judge can make a determination based on a hardship standard. 

 

Chairman Anderson:

This really puts the judge, the courts into the system where they have not been in the system before as an oversight protective function.  Is that what the outcome of this will be?

 

Assemblywoman Buckley:

Does it make sense, someone could have settled for a lump sum, and instead of doing a lump sum they did a structured settlement?  So now they are getting a lump sum from their structured settlement.  And probably they would have made out better if they had just taken a lump sum settlement as opposed to now letting some company get a piece of their money.  So why are we doing all this?

 

Randy Dyer:

In fact, people do not do better with a lump sum.  Studies that have looked into this area show that individuals who take a lump sum unfortunately dissipate the money long before its intended use. 

 

Assemblywoman Buckley:

No, that wasn’t my question.  I am not looking at how they use their money.  I am just looking at the hard numbers.  If they had taken a lump sum compared to what that lump sum is going to look like after they sell their structured settlement.  Which number is going to be bigger?

 

Randy Dyer:

If at the time they settle their case, they take a lump sum, they then bear the burden of making that lump sum last under a taxable…

 

Assemblywoman Buckley:

I just want the answer to my question.  If you compare those two numbers, which one is bigger?

 

Randy Dyer:

The original lump sum to the fractional amount they would get for selling a portion of their payments?  The original lump sum would be larger.

 

Chairman Anderson:

So, for us non-attorneys, I have this accident, I am offered a lump sum or now I am going to get paid over time because I rejected the lump sum.  I go on my merry way and somebody approaches me because they recognize that I have the potential of a windfall guaranteed from an insurance company or from whomever.  They approach me and say, “You are in this situation, we’ll guarantee now the dollars that you have, that you have need of, so we can get you over your short-term problem because we know you have these coming in down the road.”  Then by their actions, those payments are delayed in such a way to put that person financially at risk, which is obviously wrong.  Now I become in greater financial need, so they come back to me again and offer me the rest of it out.  So, they shove me into the pond to be taken advantage of.  And the reason [the bill proposes] going to court is because it hasn’t been done this way, at least in Nevada, it is not currently done this way.  The factoring company could approach me on its own without any kind of court relationship.  I understand, I think.  Questions from members of the Committee other than Ms. Buckley?  You want to think about it? 

 

Matthew Sharp, Nevada Trial Lawyers Association:

[Introduced himself.]  What I would like to do a little bit is explain the practical realities of how clients are involved in structured settlements.  But first, I would like to commend Assemblyman Brown, Pat Law, Mr. Dyer, [and] Mr. Alonso’s clients, for I think what is important consumer protection.  When I explain to you the context in which our clients go into structured settlements, I think you will appreciate why this type of bill is important. 

 

When we go through the process of litigation and arrive at a settlement through negotiation, oftentimes we are representing people severely injured, lifetime medical problems; in the case of my practice, I often represent people who have been financially ruined by insurance companies.  So we are in a position where part of our responsibility is to ensure that the work we have done to get our clients compensated does not go to waste.  And what we like to do, a lot of us, is work with our clients in providing them a structured settlement.  People of my association work with Pat Law, I work with other brokers, and we work together to provide our clients a structured annuity which will allow them for a time to receive set payments every month. 

 

The benefit to that is that the consumer, the plaintiff, is entitled to the set money in a relatively conservative investment with a guaranteed rate of return.  Their funds are protected, they don’t get a second chance in the court, we know that.  This is their last chance, they’ve got their settlement, and they are in a situation where they can protect it.  We know there are people out there that would like to invest on their own, and that’s fine, they can do that.  This is a situation where we’re in a position to protect our clients and their best interests.  That structured settlement is set up through the work of the attorney, the client, and the broker.  Then years down the road you might end up in a situation where your client is targeted by one of these what I would term unethical groups that would target people with large structured settlements, expose them to get some money from them, and turn them into a bad deal. 

 

Right now, there is no real regulation over this process.  I am not here to say that every person out there targeting these plaintiffs and trying to buy out their structured settlements are doing a bad business.  Mr. Alonso is representing people who are doing that for valid reasons.  Health issues can come up and more money needs to be gathered than is currently available under the structured [settlement].  This bill targets the people who are doing things unethically.  I think that any way that we can, as a body, protect those people who need our assistance, who are tragically injured, who need this money to continue in their process of getting medical care, is a positive thing.  I would be happy to answer any specific questions the Committee may have on how the structured settlement works, but just so we all understand, the initial structured settlement that is purchased as a result of the settlement is typically done at the request of the plaintiff.

 

Assemblywoman Buckley:

I think this is a good bill, I think it is a good step to have court oversight of these settlement agreements.  I guess what I am still a little bit bothered by is the person could have gotten more money if they would have settled for a lump sum up front and now we let more for-profit companies in the middle take these injured victims’ funds.  It was like when we legalized payday lending with 1000 percent interest.  I am just wondering, are we legalizing folks who might be vultures?  There was a good reason to enter into the structured settlement. 

 

Matthew Sharp:

Your concerns are valid.  I think there is a portion of this business, the people buying the structured settlements, that is not all bad.  There are a large percentage of people out there, in my opinion, I don’t want to cross over, I don’t know everybody in the industry.  My experience has been that when these companies target plaintiffs to buy out their structured settlement it is usually not a good deal for the plaintiff.  But they are doing it right now. 

 

So, how do we address that?  I think that we have to provide some protection.  The proposals that I have seen are reasonable.  Mr. Alonso will be talking about a model act that allows court intervention.  What I would also suggest, and I believe Mr. Alonso and Mr. Dyer had no objections, is that any sale of this annuity provides the attorney who represented the plaintiff with notice, because that is critical in that process.  I certainly as an attorney would want to know if my client was entering into this deal and why.  

 

But there are situations and on the other side of the house right now we are debating in Senate Bill 97 the use of mandatory periodic payment.  One of our concerns in that situation is it doesn’t allow for any situation where you have a special need, a medical catastrophe where that plaintiff needs more money up front quickly.  Those situations do arise and it makes sense to have a marketplace to help those people.  But I think your concerns are certainly valid, we don’t want to put this in a situation where we are making it worse than it is already.  I don’t think this bill does that; I don’t think the model act that Mr. Alonso has proposed will do that either.

 

Alfredo T. Alonso, representing the National Association of Settlement Purchasers:

[Introduced himself.]  We have submitted copies of the “Model State Structured Settlement Protection Act” (Exhibit H), which is a bill that has been passed in part in over 35 states, and it is my understanding that this specific legislation has been [passed] in its entirety in 21 states.  We have discussed this with Mr. Brown and the other parties, and everyone has agreed.  This essentially became the model legislation when this issue first began.  

 

As others have said, there are some bad players in this game and nobody wants these individuals being taken advantage of.  I think that probably the most significant issue here is that times change, circumstances change for people, and whether that be a situation where an individual has a chance to get into business for he or herself, or simply the economic issues change for them, sometimes there are some very legitimate reasons for needing that lump sum.  I think this is a matter of which we can regulate, get the bad players out of the game, at least a good attempt at it, and I think the model legislation goes into the issue a little bit more specifically.  Again, this is something that has been discussed and agreed to by all parties, and is being currently done in several states.  If you have any questions, I would be glad to answer them.

 

Chairman Anderson:

The [“Model State] Structured Settlement Protection Act” that you have handed out to us was used in the drafting of this piece [A.B. 166] that we have in front of us or not?

 

Alfredo Alonso:

It is my understanding that it [A.B. 166] was based upon it simply because it has been used in other states.  But I have discussed this with Mr. Brown, as well, and he and others agree that, I think, [the “Model State Structured Settlement Protection Act”] goes a little further.  I think it takes some parties out of the mix, for example, the insurance companies, that probably should not be there and probably don’t want to be there, for that matter.  We agree with Mr. Sharp that in circumstances where these individuals move out of the state, we have absolutely no problem with a mechanism where Mr. Sharp or the attorney for the individual are informed that this is happening.  I think that would be a good added counseling to this individual under those circumstances.  I think that their attorney obviously ought to discuss this with them before they enter into such an agreement.

 

Chairman Anderson:

Has the National Structured Settlement Trade Association, to your knowledge, submitted this to the National Uniform Commission [National Conference of Commissioners on Uniform State Laws]?  We have Ms. Ohrenschall, who is a member of the Commission, and I am curious as to whether there had been any review of this by the Uniform Law Commissioners.

 

Randy Dyer:

In answer to your question, no, we have not gone before the National Conference of Commissioners on Uniform State Laws.  There have been several versions of this model legislation.  The one that Mr. Alonso handed you is sort of the compromise language that all parties have agreed to most recently.  NCOIL (National Conference of Insurance Legislators) has their own model, there are other models floating around.  But, this is the latest one and this is the one that everyone thinks is going to work the best.


Assemblywoman Buckley:

Questions for Mr. Sharp?  Are there any more consumer protection measures in the NCOIL model as opposed to this model? 

 

Matthew Sharp:

I don’t know, I have not reviewed that bill, I have reviewed the Model Act this morning and I am relying principally on Mr. Dyer saying that he is in agreement with the Act.  Again, my major concern was providing notice to the attorney because I think that allows your concerns to start working.

 

Randy Dyer:

The NCOIL bill was the result of debates held at the NCOIL meetings between our organization and the factoring companies.  In fact, I think the NCOIL legislation is somewhat weaker than the bill you have before you.  I think the bill you have before you has more consumer protections.

 

Assemblywoman Buckley:

Which ones?

 

Randy Dyer:

I would have to go from memory and I am afraid I did not bring that material with me.  I can provide you with that, though.  I have done a detailed comparison of the two bills and would be happy to send that to you.

 

Assemblywoman Ohrenschall:

I was just wondering if you are planning to do any interaction with the [National Conference of] Commissioners on Uniform State Laws?

 

Randy Dyer:

No, we did not.

 

Assemblywoman Ohrenschall:

Are you planning to at this point, while this is going through our Legislature, perhaps?

 

Randy Dyer:

If that would be helpful, we would be happy to do that, but we did not have that planned.

 

Assemblywoman Ohrenschall:

I think it might be.


Chairman Anderson:

Other questions for these gentlemen?  Anybody else wishing to speak on A.B. 166?  The suggestion, if we are going to move with the bill, looks like we are going to need some additional information from Mr. Dyer to satisfy Ms. Buckley.  We would ask Mr. Sharp for some language, some suggestions where he would think that we would want to put this amendment relative to notification.  We will get our legal counsel to do that too, without too much problem. 

 

Matthew Sharp:

Under…the bill I am working off of is the “Model State Structured Settlement Protection Act,” which is the handout that Mr. Alonso provided.

 

Chairman Anderson:

I don’t think we are using that.

 

Matthew Sharp:

In the course of this hearing, that is where I am a little confused, because I was understanding that all the parties on our side of the table are in agreement that the “Model State Structured Settlement Protection Act” should be the vehicle and should not require an amendment.

 

Chairman Anderson:

…and not A.B. 166?

 

Matthew Sharp:

That’s correct, that’s my understanding.  To address Assemblywoman Buckley’s concern, I think there was some confusion.  As I understand the NCOIL act has less protection than the Model Act that we have in front of you.  So, if you want me to work off of that Act, I can tell you where my provisions would need to be inserted.

 

Chairman Anderson:

Since we only saw this [“Model State Structured Settlement Protection Act”] when it was handed out, I don’t know whether it was shared with Mr. Brown.  Mr. Alonso did you share this with Mr. Brown ahead of time?

 

Alfredo Alonso:

Yes, we discussed this with Mr. Brown, and he was in agreement as well.

 

Chairman Anderson:

…and had you shared it with our legal counsel?

 

Alfredo Alonso:

No, we just handed it out and I think it is the first that she has seen it.

 

Chairman Anderson:

Well, obviously, we will all have to take a look at it.  Mr. Sharp, if you wish to make some suggestions to where…if we are going to move with the legislation, then the suggestion is we will have to take a look at the “Model State Structured Settlement Protection Act” as it was submitted here and where our good protection is and whether or not Mr. Dyer is going to point out those particular points to us before we can do that.  I would indicate to you that time is of the essence, as in not later than a week; by Wednesday would be great.

 

Matthew Sharp:

I can provide a written proposed amendment to the Committee.

 

Chairman Anderson:

If you would.  Please share that with Legal and Research, Ms. Combs and Ms. Lang in addition.  [Close the hearing on A.B. 166.]

 

Let’s turn to the third bill of the day, A.B. 302.  Let’s hang on for a second, then.  Let’s move to the last bill of the day, A.B. 385.  Open the hearing on A.B. 385, Mrs. Koivisto’s bill.

 

Assembly Bill 385:  Makes various changes concerning civil actions involving physical acts committed against incapacitated minors. (BDR 3-54)

 

Assemblywoman Ellen Koivisto, District No. 14, Clark County:

[Introduced herself.]  This bill was brought to me by a lady who I hope is down in southern Nevada to give us some details.  It is really anti-bullying bill.  We mainstream children in our public schools, children who, in this bill are called “incapacitated minors,” or children who are mentally or physically disabled who are mainstreamed into our school system.  These children are given an IEP (Individual Education Plan), which spells out how their education is to be dealt with.  When these children are injured by other children in school, my understanding is that there is no recourse for the parents of the injured child.  That’s why Ms. Germeroth came to me and asked if I would do this bill.  I am not going to say it’s a simple bill, because it isn’t.  I think that since we mainstream these children and put them in a public school, we also bear the responsibility for those children’s safety while they are there.  I see Ms. Germeroth is in Las Vegas.


Sue Germeroth, education advocate:

[Introduced herself.]  I go into the schools and help parents with “special needs kids” to do programming and planning.  My attention came to this when I helped a family with had a daughter who has Down Syndrome, who was molested on the campus because her plan that Ellen [Koivisto] talked about had not been followed, and also because the boy who had molested her was just recently put back in school and he had a propensity and he wasn’t being watched, either.  As the whole situation evolved, the school district stipulated to the fact that they needed to have escorts.  Then the parents went to an attorney, the attorney said no damages were available to them because the daughter who had Down Syndrome could not articulate the damages.  So that was a concern to me, that when a child can’t articulate damages, if there is no physical damages, then damages that are social or behavioral need to be articulated to have any recourse.  And these children can’t do that in most cases. 

 

So she is OK in middle school, she goes to high school, high school fails to provide what her plan called for, and within the first two weeks of her high school attendance she was once again molested, not by the same boy, because he had gone to a detention center, but by the boy’s friends, who knew this girl had an inability to stop this.  So there was a pattern established.  Because this isn’t right, we pursued with what we might do to alleviate this problem. 

 

Chairman Anderson:

Questions from members of the Committee?  I see none at this time.  I guess the question is, there were some criminal penalties that were available.  Obviously, the parents did take advantage of the criminal element of the child being taken advantage of at school, and that is why the first individual…  Did the school follow up on the other molesters?

 

Sue Germeroth:

In her high school years, no.  The parents did not either.  The parents are immigrants, there is a language problem, and I think they are very shy about the whole situation.  I do have a question, because this is totally out of my element, in the wording of what’s proposed.  The concern was not necessarily the liability on the parent’s part.  I am under the understanding that is already incorporated that the parents are liable for the child.  The concern was if the supervising agency, whether it would be the school or a recreational center or someone is already aware of the propensities, and they don’t address the issue and there are no preventative measures taken.  And then this damage occurs, but there really isn’t damage in the eyes of the law because the child can’t articulate the social or moral or behavioral damages done.  Then there needs to be some sanctions [to create] an accountability so that this doesn’t occur.  Yes, the school district did file on the boy, and the boy did go into a detention center.  But it did not stop another occurrence happening.  Had this little girl been able to “have her day in court,” maybe there would have been more attention paid to this.  This shouldn’t happen. 

 

Chairman Anderson:

How will this bill then give her a “full day in court”?  If the parents failed to identify to the school this particular event having taken place, and the school, the agency was not notified of it, how then will this bill help alleviate the initial criminal activity?

 

Sue Germeroth:

You are talking about the high school situation?  It was brought to the high school’s attention.  The girl does now have an escort and she is being supervised in all areas of the school environment.  How I think this would help is if the damages don’t have to be articulated.  If the damages can be assumed and then the child can have a spokesperson, then the parents have some recourse against agencies when they are not protecting their disabled children.

 

Chairman Anderson:

So if a special needs child is in the educational setting and makes an allegation against another student in the class, the assumption will be that the special needs child is correct right from the start? 

 

Sue Germeroth:

If there is an allegation, I think that is different if indeed it had occurred.  I don’t know how to answer that particular scenario.  With the one I am familiar with, there was no question that this had happened in both the junior high and high school.  There was just no recourse for the parents so that closer attention would be paid.  If there are no consequences, then there is more of an aloofness about having these children supervised.  They stipulate, “Yes, sorry, she wasn’t supervised, she got molested, we will do it better next time.”  That was end of that.

 

Assemblyman Horne:

I am a little confused now.  I am not sure if you are looking for relief from the schools for lack of supervision or from the parent of the perpetrating student.  And if it is the school, I think that there is already recourse or liability for when schools fail to protect their students.  If it is the student, would this cover if the perpetrating student was another incapacitated minor?  Would those parents, you see what I am saying, for instance, in the scenario you told us about, if the perpetrating student was also a Down Syndrome boy, would this statute cover them, and would be seeking retribution from his parents or guardian?

 

Sue Germeroth:

This particular boy had been expelled for deviant behaviors, including being sexually aggressive.  He came back; he was not supervised in this particular case.  He needed supervision.  My opinion is, probably if something was on the books, maybe his parents could have sanctioned the school a little bit for not providing supervision for him so that he was allowed to do this, I don’t know.  I am not an attorney; this is out of my field.  My understanding is that there were no sanctions against the school district in this case because there was no physical damage, so there had to be some other kind of damage to establish negligence on the school’s part.  And there was no damage that could be articulated by the child because she does not have the cognitive capacity to understand the moral and social impact of being molested.  That’s where the problem came in; there was no negligence because there was no damage that could be established.  Obviously, the child molested is damaged in some capacity.  Whether they can cognitively process that or not is according to if they can, if their disability is such an extent that it won’t be allowable.  But that was the problem.  My feeling is because there was no sanction against what had happened, they were careless, and it happened to the girl again.  I don’t know if that answers your question or not.

 

Assemblyman Horne:

Not really.  What concerns me is that we would be taking this assumption and maybe I make a mistake in focusing on the case you presented to us here.  But this second charge of molestation at high school, I am uncertain in this particular instance if this high school girl, having Down Syndrome, they make choices to go with boys all the time.  Are we making the assumption that because she has Down Syndrome she must have been molested, because she couldn’t have agreed to this herself?  Because she can’t articulate it or won’t articulate it, we are just going to assume that it was molestation and we are going to go from that.  I don’t know, I just seems a huge jump.

 

Sue Germeroth:

I don’t know, the fact of the matter is, if her plan would have been implemented, she would have had an escort, she would have been in view of some supervising adult at all times, and there would have been some intervention so that nothing would have occurred.

 

Assemblywoman Koivisto:

It might simplify things a little bit, if I am understanding Ms. Germeroth correctly, lines 14 and 15, page 1, instead of referring to the parent or guardian of the perpetrating student, it should put the responsibility on the school district who failed to take responsibility and live up to the IEP that was in place. 

 

Sue Germeroth:

I do not know if this is appropriate, but I do have James Kent with me, an attorney that does school law.

 

James Kent, attorney:

I believe Assemblyman Horne was accurate in the sense that the avenues to seek compensation or damages or hold a party responsible are there.  If in fact an act occurred on the school grounds and it was proven that the school was negligent in supervision or if a parent was negligent or if a student committed a criminal act, I believe the avenues are there to allow the victim to pursue [sanctions] against them.  What we are falling into the problem of, is we have a victim that cannot communicate damages.  If in fact somebody got punched in the eye and had a black eye, the bruising is very evident and you can see the damages and you see the act committed.  But if somebody is molested, like in the case Ms. Germeroth was talking about, this child cannot communicate how it has psychologically damaged her, how it may have physically damaged her, unless there were some other physical aspects to it.  And without somebody being able to indicate how they were harmed, that’s where the lawsuit is going to come to a problem because now somebody can’t actually vocalize or explain to a judge or a jury or other fact finder how they have been harmed.  I think to say that we have to write in something so that the school district is automatically held liable or anything like that, I think the focus is really getting off from what the bill was intended to do.  I don’t know if everybody had a chance, there was a memorandum dated March 5, 2003 to Assemblywoman Koivisto on this bill draft request.  On the third page of that…

 

Chairman Anderson:

I am sorry, that is not germane because if we don’t have that, it’s not been distributed to us, nor does the Assemblywoman [Koivisto] appear to have it.

 

James Kent:

I apologize.

 

Assemblywoman Koivisto:

I don’t have the memo and I don’t believe I have even seen it.

 

James Kent:

When Ms. Germeroth came with her concern to us, the crux of what we were looking for, is to indicate that if a child who is incapacitated or has a disability and is otherwise unable to communicate damages, and there is a perpetrator that is found to have committed an act that would otherwise be criminal in nature, then damages can be presumed just by the fact that the perpetrator was found to have committed the criminal act.  So that we do not have to have the victim up there trying to explain the emotional trauma that he or she was put through or the damages that he or she felt she sustained.  What we are looking for is when a person is unable to communicate that, then if the act is proven that would be otherwise criminal, then the damages would be presumed. 

 

Chairman Anderson:

Currently, under NRS 41.470, “Imposition of liability for minor’s willful misconduct,” you can sue the parent or guardian having custody or control of the minor directly for the minor’s willful misconduct.  So the question, I guess, while the joint and several liabilities are only $10,000, now you are going to move to a presumption that immediately… I guess I have some questions about what’s going to happen.

 

James Kent:

Again, I am not simply stating that if a person makes an allegation that there is a presumption they are accurate or that it is 100 percent truthful.  As you have indicated, there is an avenue to seek recourse or damages for the act of the child against that child’s parents, but in the process of doing that, just as if that child came over and hit me with a brick and broke a leg or something like that, I could show medical bills and things like that that would justify the damages.  What we are running into, if we were to pursue an action under NRS 41.470 and go against the parents, eventually a fact finder is going to ask you, “How were you harmed or how were you damaged?”  And that’s where we then have the victim unable to communicate their damages.

 

Chairman Anderson:

…in this particular case.

 

James Kent.

Yes.  We are looking at a fairly specific situation where we are dealing simply with handicapped people and in this instance, handicapped children that can’t otherwise communicate damages.

 

Assemblywoman Buckley:

What level of damages would then be presumed?  Have any other states in statute created such a level of presumption where a plaintiff is unable to articulate their injuries?

 

James Kent:

I am not familiar with how any other states have handled that.  I’ve just not had the time or the depth to do that research on it.  As to the extent of the damages, I guess, I am not looking at putting a level on there.  I don’t even know if it is appropriate to put a maximum cap or anything like that.  Just as in any other situation, if you are in a car accident, an intentional tort done against you, it may go to a jury or a judge or a fact finder.  They will determine how it offended them and what they think somebody should be compensated for.  In this instance, if in fact, an act is otherwise criminal, such as a molestation or even unfortunately a rape, occurred, then there is a presumption that this person was in fact damaged and then it would be up to the jury or the judge or the fact finder to say, “This is how much we think the act that was proven would damage such a person.”

 

Assemblywoman Buckley:

I know that in Clark County that there is a lot of concern with the school district and its treatment of students with disabilities.  And the concerns are everything from failure to implement IEPs and bad things happen, or children being bruised and not enough being done.  We have a little task force that has been meeting with Carlos Garcia [Superintendent of Clark County School District] about it and trying to get more parental involvement to follow up on A.B. 280 [of the Seventieth Legislative Session] that prohibited aversive techniques on students with disabilities.  I just wanted to say I would be happy, we have Karen Taycher with PEP (Parents Educating Parents) and some other groups working on this.  It sounds as if maybe your advocate who testified, Assemblywoman Koivisto, might find that an avenue to redress some of these things, because I don’t think the bill matches the problem.  I am sorry, I would be happy to get that information to her.

 

James Kent:

With regards to the groups that Ms. Buckley mentioned, I know that Ms. Germeroth is familiar with them.  I am not certain if she’s familiar with the bill; but we appreciate that information.  I kind of agree, because when we read the draft of the bill, it seemed like the concept was getting away from what the original problem was.  That’s why we both came this morning to try to clarify what the concerns were that were being presented and what we wanted the bill to address. 

 

Assemblyman Mortenson:

As I read this, it seems to me that two minors could interact in an amorous totally willing manner into an amorous act, in which the parent or guardian, in which there is no injury to either party, but the parent or guardian is mentally injured, in other words they are outraged because this happened and then we have a suit going on.  It can be read that way, against an incapacitated minor which causes a mental injury to the parent or guardian, if you take out all the “are.”  It seems a little excessive to me.

 


Chairman Anderson:

An observation from Mr. Mortenson.  Ms. Koivisto, anything you want to add to our discussion before we move on to those in opposition?  Or have concerns about the bill in other areas?

 

Assemblywoman Koivisto:

No, thank you, Mr. Chairman.

 

James Kent:

May I make one last comment?  Although the incident that Ms. Germeroth talked about in the example we have been using has been in the school district area, the concern is not just that this happens in the school district.  It may happen in a doctor-patient relationship where a psychologist or medical doctor is dealing with a child who is mentally challenged and is taken advantage of.  It may happen in a street neighborhood; it may happen in a family relationship.  So we are not just looking at things that happen at the school district.  The protection we are trying to have is for these people who may not be otherwise to express their damages or their hurt.  We just want to be able to give an avenue to protect them in all circumstances.

 

Chairman Anderson:

I have no one who wishes to speak against the bill but I have some concerns; there are some issues that need to be raised relative to the bill.

 

May Shelton, consultant, representing Washoe County Social Services:

[Introduced herself.]  Some of the questions and issues raised by Mr. Horne, Mr. Mortenson, and Ms. Buckley were things that we also had concerns about.  After having listened to Ms. Germeroth and Mr. Kent, our read on the bill originally is not what apparently they intended.  It is very confusing to us.  Let me tell you some of our concerns. 

 

The bill allows an instant cause of action, and I am told that that means the first time an incident occurs, the perpetrator and his parents can be sued.  There are no interim steps such as mediation, referral to juvenile services, treatment, counseling, therapy, et cetera.  Resolving these situations in court we don’t think would change the behavior.  We thought it was an anti-bullying bill, but apparently it is more than that.  The bullying behavior of the child, in fact, will send the wrong message to both children, the victim and the perpetrator, and that this is all about money.  That would be not a good message.

 

Secondly, we noticed that in the bill, “licensed foster parents and group home operators” would be exempt from liability.  But legal guardians and relatives, with whom we place children from the child welfare system, would not be exempt.  That could be a chilling effect on permanency planning for children in the system.

 

Finally, our attorneys tell me that the county, which might have physical and legal custody of children who might be the perpetrator, would not be exempt and that lots of people might come after us under the “deep pocket” theory.  That was a concern.  If you are inclined to consider amendments, we would be happy to participate.

 

Pam Becker, Organizational Analyst, The Children’s Cabinet Inc.:

[Introduced herself.]  Our concern with this bill is that it is characterized as an anti-bullying bill and it pertains to children ten years and younger.  Even though the example that was given was of school-aged children, it does concern us that the implication could go into child care centers.  When you are dealing with children ten years and younger, they are still very developmentally appropriate to give them skills.  We don’t believe that this bill provides for any interim steps, such as Ms. Shelton said, of giving some tools, some workshops perhaps to the parents and to the children, and then allowing them to be monitored over a period of time to see if they have acquired those skills and that they can change their behavior that might have been observed at one time.  These would be our objections to the way that this is written.

 

Chairman Anderson:

Any questions for Ms. Becker from The Children’s Cabinet?

 

Stu Fredlund, Social Welfare Manager, Division of Child and Family Services, Nevada Department of Human Resources:

[Introduced himself.]  I just want to read a short message into the record.

 

Chairman Anderson:

If you could send that to us, it would be helpful.

 

Stu Fredlund:

[inaudible testimony] foster home recruitment when these people eventually want to become guardians and/or adopt foster children.  The liability issues could be huge.  The Division could be sued and/or foster parent, and we cannot get insurance now to adequately cover foster parents.  This would only make our quest for more foster homes more difficult to obtain.  Many times we keep kids out of our care by getting voluntary agreements in the form of temporary guardianships.  If this bill were passed we would have a very difficult time getting families to accept guardianship, as it could mean liability for an occurrence somewhere, such as at a school when a guardian had no way to prevent the injury.  Our biggest concern is it will mean many more kids in the Division’s custody and fewer foster homes to care for them.  Basically, that is our concern on the impact on all those caretakers we depend upon.

 

Chairman Anderson:

Sir, have you read the bill at line 10, page 1, which excludes at NRS 424.085, foster parents? 

 

Stu Fredlund:

Yes.

 

Chairman Anderson:

Thank you.  You want to make sure that you send your remarks up so that we can get them in the record.  Anybody else who hasn’t had an opportunity to be heard on A.B. 385?  Close the hearing on A.B. 385.

 

The Chair has two bill drafts that need Committee introduction:

 

·        BDR 10-870 — Revises various provisions governing contractors and claims and transactions relating to real property.  (A.B. 449)

 

ASSEMBLYWOMAN BUCKLEY MOVED FOR COMMITTEE INTRODUCTION OF BDR 10-870.

 

ASSEMBLYMAN CLABORN SECONDED THE MOTION.

 

THE MOTION CARRIED UNANIMOUSLY.

 

·        BDR 3-448 — Clarifies provisions governing arrest involving violation of order for protection against domestic violence.  (A.B. 448)

 

This is from the Attorney General’s Office, an agency bill.

 

ASSEMBLYWOMAN OHRENSCHALL MOVED FOR COMMITTEE INTRODUCTION OF BDR 3-448.

 

ASSEMBLYWOMAN BUCKLEY SECONDED THE MOTION.

 

THE MOTION CARRIED UNANIMOUSLY.

 

We will try to speed those down to the [Assembly] Floor.

 

Let’s turn our attention, finally, to A.B. 302.

 

Assembly Bill 302:  Repeals duplicative provision concerning penalty for sale of imitation controlled substances. (BDR 40-1284)

 

Assembly Bill 302 is the issue of removing something from the statute because we don’t need it anymore.  We requested this on behalf of the Committee to address a Nevada Supreme Court decision in Washington v. State.  The penalty for this activity under NRS 453.332, which was enacted in 1983, is a misdemeanor; the penalty under NRS 453.323, which was enacted in 1977, is a felony. 

 

Kristin Erickson and Jim Nadeau have both indicated interest in the bill, and I see Ben Graham sitting in the back. 

 

We have a handout (Exhibit I) here for us.  The court indicated that the 1977 statute with the felony penalty was repealed by implication since the later statute, which imposes a misdemeanor penalty, covers its substance.  The Legislature may choose to address the decision with one of the following options, as set forth by Ms. Lang.  Ms. Lang, could you explain it a little bit further so that we understand what we are going to do?

 

Risa Lang, Committee Counsel:

This was one of the cases that we discussed during our first week of the Committee, where we discussed the cases that held some of the laws unconstitutional during this past interim.  In this particular case, they held that there were two statutes that covered the same conduct, so the Court repealed by implication one of the statutes.  They held that the statute that was passed later in time was the statute that would remain and the other one they deemed to be repealed.  So you can see the two sections.  The repealed section is there for you under the text of repealed sections; it provides a Category C felony, whereas NRS 453.3345, which in the first section of the bill though makes it a…  I am sorry; it is not even in this bill.  The first section is removing that reference.  So the section that would remain makes it a misdemeanor for the same conduct.

 

Chairman Anderson:

It would appear that our choices are that we can either do [option] “A” (Exhibit I), which is what this bill does, or if we feel that it is necessary to amend the bill in some stronger statute, we can do that too.  Option “a” is to leave us with the felony statute?  That is what I was going to recommend.

 

If we agree with the interpretation of the Nevada Supreme Court, if we officially repeal, we would officially repeal the felony section [NRS 453.323].  If we believe a greater penalty should be imposed, we would repeal [NRS 453.332] with the misdemeanor, so only the felony provisions remained.  (Exhibit I)

 

Am I to understand that if we take the bill, we remove the felony and leave the misdemeanor?

 

We all understand what we are doing?  We are going from a potential felony; we are going to agree with the Nevada Supreme Court. 

 

ASSEMBLYWOMAN OHRENSCHALL MOVED TO DO PASS A.B. 302.

 

ASSEMBLYMAN MORTENSON SECONDED THE MOTION.

 

Questions from members of the Committee?  [A voice vote was called, roll call vote was required.  Roll call vote was taken.]

 

THE MOTION CARRIED WITH ASSEMBLYMAN HORNE AND ASSEMBLYMAN OCEGUERA VOTING NO. (Mrs. Angle and Mr. Carpenter were absent for the vote.)

 

Eleven in the affirmative, two in the negative, and two absent; the bill has passed.  Let me ask Mr. Gustavson to read the bill on the Assembly Floor.

 

Anything else that needs to come before us?  We got the green sheets. 

 

Let me indicate to you, as we grow tighter here in terms of time, I am contemplating some Saturdays and I am going to try to keep us away from a weekend or evening meeting until the last week.  We are about three weeks away from that.  While you guys may not be thinking in that vein, I already am there.  The problem is that things become very difficult to schedule.  From this point forward, the chances of moving away from a bill or getting it moved from one place to another becomes very difficult.  We may be having to use a couple of evening meetings in that first week of April to facilitate, I am looking at, in addition, April 1, 2, and 3 as the potential days we would be doing that in the evening and doing some of our work sessions in that time period.  Oops, I am putting myself a week early.  April 8, 9, and 10 and possibly Saturday, April 5 as a date we might need to begin to schedule one or two bills on or a work session on. 

 

So recognizing that we are getting close to the end, the deadline for Committee passage, of course, is April 11, so I need to have enough time to try, if I have created for you some unusual set of problems, which I have for Mr. Brown already, I apologize for that.  Please notify me as quickly as possible so if there is any opportunity that I can move something about or tweak it just a little bit, I will try to accommodate everybody.  I know that sometimes it is very difficult to get people notified that we are going to be here and that we are ready to do this.  They think we just hang out; that is not the case. 

 

Anything else that needs to come before us?  This is the last Monday we will be starting at 9 a.m.  I want you to note that we will be starting on March 31 we will be moving to an 8 a.m. start time; it has been suggested that I move to a 7:30 a.m. start time, but I am kind of rejecting that for the time being.

 

 

We are adjourned [at 10:40 a.m.].

 

RESPECTFULLY SUBMITTED:

 

 

 

                                                           

Deborah Rengler

Committee Secretary

 

 

APPROVED BY:

 

 

 

                                                                                         

Assemblyman Bernie Anderson, Chairman

 

 

 DATE: