MINUTES OF THE

SENATE Committee on Judiciary

 

Seventy-second Session

May 2, 2003

 

 

The Senate Committee on Judiciary was called to order by Vice Chairman Maurice E. Washington, at 8:00 a.m., on Friday, May 2, 2003, in Room 2149 of the Legislative Building, Carson City, Nevada. The meeting was videoconferenced to the Grant Sawyer State Office Building, Room 4406, 555 East Washington Avenue, Las Vegas, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

 

COMMITTEE MEMBERS PRESENT:

 

Senator Maurice E. Washington, Vice Chairman

Senator Mike McGinness

Senator Dina Titus

Senator Dennis Nolan

Senator Valerie Wiener

Senator Terry Care

 

COMMITTEE MEMBERS ABSENT:

 

Senator Mark E. Amodei, Chairman (Excused)

 

GUEST LEGISLATORS PRESENT:

 

Assemblywoman Peggy Pierce, Assembly District No. 3

Assemblyman David Goldwater, Assembly District No. 10

Assemblyman William Horne, Assembly District No. 34

Assemblywoman Vonne Stout Chowning, Assembly District No. 28

 

STAFF MEMBERS PRESENT:

 

Nicolas Anthony, Committee Policy Analyst

Bradley Wilkinson, Committee Counsel

Jo Greenslate, Committee Secretary

 

OTHERS PRESENT:

 

Robert E. Roshak, Sergeant, Lobbyist, Las Vegas Metropolitan Police, and Nevada Sheriff’s and Chief’s Association/South

Ernest E. Adler, Lobbyist, Nevada Housing Coalition

Larry L. Spitler, Lobbyist, American Association of Retired Persons

Jon L. Sasser, Lobbyist, Nevada Legal Services

Charisse Earhart, Southern Nevada Multi-Housing Association

Kris Bellister, Washoe County Senior Law Project

Robert Desruisseaux, Assistant Technology Specialist, Northern Nevada Center for Independent Living

David Howard, Lobbyist, Northern Nevada Apartment Association, and Southern Nevada Multi-Housing Association

Valerie Hand, Gaston and Wilkerson Management Company

Shelly Baker, Northern Nevada Apartment Association

Natasha Larsen, Carefree Senior Living

Donna Harris

Roberta Ross, Owner, Ross Manor

Ruth Wheeler, Wheeler Enterprises

James J. Leavitt, Attorney

Laura Fitzsimmons, Attorney

Donna Aimee Tucker

Gregory J. Walch, Attorney

John Sande III, Lobbyist, Airport Authority of Washoe County

Michael Alonso, Lobbyist, Airport Authority of Washoe County

Michael G. Chapman, Attorney

John Madole, Lobbyist, Associated General Contractors, Nevada Chapter

Stephanie Barker, Attorney, Civil Division, Clark County District Attorney’s Office

Heidi Mireles, Chief of Right-of-Way, Director’s Office, Department of Transportation

Brian Hutchins, Chief Deputy Attorney General, Transportation and Public Safety Division, Office of the Attorney General

Zev Kaplan, General Counsel, Regional Transportation Commission of Southern Nevada

Leslie Nielsen, Chief Deputy City Attorney, City of North Las Vegas

 

Vice Chairman Washington:

We have three bills to hear this morning. Assemblyman Horne requested to introduce his bill last, Assembly Bill (A.B.) 397. We will open the hearing on A.B. 419.

 

ASSEMBLY BILL 419 (1st Reprint): Provides that landlord of dwelling units intended and operated exclusively for persons 55 years of age and older may not employ person to perform work on premises unless person has work card issued by sheriff. (BDR 10-833)

 

Assemblywoman Peggy Pierce, Assembly District No. 3:

We all know Nevada has the fastest growing population in the nation today. In Clark County, the growth is 65,000 new residents per year. A significant portion of the growth is attributable to the senior population. As more and more seniors move into our communities, it becomes critical for this body to take steps to protect seniors from those who prey on them. I believe A.B. 419 is one of those steps.

 

Section 1 of A.B. 419 states a landlord will not employ any person on the premises of an apartment complex designated for those 55 years or older unless that person has been issued a work card. Section 2 states the sheriff of a county shall issue a work card, and the work card will be for 5 years unless that person moves to another complex not within the same corporation. Section 3 outlines the method required for issuing the work card, including a check of the person through the central repository and submitting fingerprints to the Federal Bureau of Investigation (FBI). It also allows for a temporary work card to be issued, pending the background check, so no one is unemployed during that period. If the fingerprint return indicates the person should not receive a permanent card, the sheriff will notify the person of the cancellation of the temporary card.

 

Section 4 covers those persons who are not required to obtain work cards. Each of us knows family members, friends, or constituents who are elderly. We also know many of these citizens are cheated, abused, or victimized. Assembly Bill 419 will make it more difficult for those who work at senior apartment complexes to victimize our citizens. This bill came out of a situation that was not brought to me, specifically, but to someone else, regarding an ex‑felon working in one of the senior complexes in my area. That did not seem to me to be a good idea, and this bill addresses the situation. I worked out some problems the apartment association had, and we amended the bill. I was just now told there is a problem with the fact low-income housing uses inmates to do maintenance work. I am willing to sit down with those concerned and work out some kind of amendment.

 

Vice Chairman Washington:

You mentioned the directors of low-income housing. In A.B. 419 there is a provision in section 1, subsection 4, paragraph (b), dealing with independent contractors. If we proceed with this bill, perhaps this section could be amended to accommodate those working on behalf of the prison, on grounds maintenance.

 

Assemblywoman Pierce:

Yes.

 

Robert E. Roshak, Sergeant, Lobbyist, Las Vegas Metropolitan Police, and Nevada Sheriff’s and Chief’s Association/South:

We are here to testify in support of A.B. 419. As you know, Nevada is getting grayer. We are having an increase in the senior population. What this bill affords to people 55 years or older and living in apartment complexes specifically geared toward them are the same protections of senior citizens in a care center. Individuals working in senior care centers must have work cards; we believe this will afford the same protection to senior residents living in apartment complexes others receive.

 

Senator McGinness:

Sergeant Roshak, what are the restrictions for receiving work cards? If you are a convicted felon, can you get a work card?

 

Assemblywoman Pierce:

If you are a convicted felon, you cannot get a work card.

 

Senator McGinness:

Even if it was a while-collar crime, you could not get a work card? I can see why you would not want violent offenders working in those settings.

 

Sergeant Roshak:

A convicted person can get a work card. If the person is initially denied, he or she can appeal to either the city council or the county commission and a hearing is held, at which the circumstances surrounding the conviction are weighed and a determination is made.

 

Senator Care:

Sergeant Roshak, where are the other locations in which the population is generally senior and work cards are required?

 

Sergeant Roshak:

An adult care facility requires work cards, as well as childcare facilities. Also, work cards are required with restricted licenses.

 

Senator Care:

Would you elaborate again regarding someone with a felony on his or her record? What would he have to do to obtain a work card? The reason I ask is because next week we will be hearing a bill regarding the restoration of civil rights for felons. I will be asked during that hearing what regaining civil rights entails for everything from being able to sit on a jury to seeking employment.

 

Sergeant Roshak:

If an individual applies for a work card, he or she goes through various background checks. If it is determined he or she is a convicted felon, the work card request can be denied. He or she has the right to appeal to the city or the county, and one of our officers would testify as to why we do not want them to have the card. They have the right to bring up the circumstances surrounding their need for a work card, and a decision will be made to either allow or deny the work card.

 

Senator Care:

Discretion falls upon two things: first, whether they admitted they had a felony on their record; and second, the nature of the felony, and perhaps, how recently the crime was committed.

 

Sergeant Roshak:

Yes, plus if a person did not admit up front and we find through the background investigation he or she had committed a felony, we would deny issuance of a work card.

 

Vice Chairman Washington:

In your testimony, you indicated people who work in adult care centers are required to have work cards. Are there specifications regarding which felonies would exclude the person from getting a work card, or are all felonies included?

 

Sergeant Roshak:

I do not know the exact crimes preventing someone from getting a work card, but I can obtain that information for you.

 

Vice Chairman Washington:

Assemblywoman Pierce, in A.B. 419, are you trying to protect individuals 55 or older who live in residences specifically for them to prevent additional felonies, or are you looking for specific felonies? The reason I am asking is the definition is broad.

 

Assemblywoman Pierce:

I also believe there are restrictions as to which felonies would prevent an ex‑felon from obtaining a work card, but I do not know what they are. I will get that information to you.

 

Vice Chairman Washington:

I will ask staff to look into that, and if you would not mind, perhaps we can narrow the scope to, perhaps, those crimes perpetrated against senior citizens, so we are not making a blanket statement against all felons.

 

Assemblywoman Pierce:

That would be fine.

 

Sergeant Roshak:

I will get that information for you, sir.

 

Ernest E. Adler, Lobbyist, Nevada Housing Coalition:

The Nevada Housing Coalition is generally in support of A.B. 419. Some of the housing projects for senior citizens, especially in rural Nevada, are funded by the U.S. Department of Housing and Urban Development (HUD) or rural development dollars, and utilize Nevada Department of Corrections work crews to do everything from mow the lawns to paint the units. I believe they are currently putting siding on a building in Fallon. I tried to read this bill so they would not be prohibited from doing such work, but the way it currently reads, we lose all the inmate and jail work crews. They are paid approximately $3 an hour, and some of the money goes back to the State. This is pretty important. I guess we could have a simple amendment, exempting inmate and jail work crews.

 

I believe there are county restitution programs, because a lot of these are quasi‑public, nonprofit organizations. I do not believe these people are a threat to senior citizens, because if they are from the prison, they are wearing a blue shirt, blue jeans, and have a supervisor. If they are from the jail, similarly, they are marked so the senior citizens know they are convicted felons. We have never had any complaints concerning inmate crews mowing laws and so forth from the senior citizen population.

 

I believe this bill has a good purpose, which is essentially to keep those people who are trying to scam senior citizens from being in a position of authority. As most of you know, residents of honor camps cannot have committed violent felonies. I would like an exemption for those three classes of workers, because they will be unable to obtain work cards.

 

Senator Care:

Mr. Adler, do you know off hand what kind of background check, if any, your clients may require of the property manager? I know A.B. 419 exempts someone who holds a permit to be a property manager. It would almost seem to me in a case like this, there might even be a duty on the landlord in the first instance.

 

Mr. Adler:

Most of these are HUD-funded projects, and HUD requires a background check before appointing a manager of an apartment complex receiving federal funds. I do not believe this will be a problem for federally funded, low-income housing projects. The only problem I have had with the background check is the amount of time it takes to do the FBI check through the State; it is extremely backed up.

 

As Senator Washington stated, I have one client who has a different problem, but it could relate to this. He has a 25-year-old marijuana conviction out of Hawthorne, which was a felony there 25 years ago. He works as a janitor. This person is about as harmless an individual as I can think of. I do not believe A.B. 419 was meant to apply to people like that individual. I do not know how to write around it, except to perhaps have a time limit or types of felonies to distinguish which felons would be exempt.

 

Vice Chairman Washington:

I was just looking at A.B. 419, and I believe in subsection 4, section 1, there may be an opportunity to put a paragraph (c) for another exemption into the bill.

 

Mr. Adler:

Yes, I agree, for inmate work crews, jail work crews, or people performing restitution work.

 

Vice Chairman Washington:

Perhaps we could classify them as independent contractors.

 

Mr. Adler:

Although they are not really independent contractors, they are employed through the Department of Corrections.

 

Vice Chairman Washington:

Perhaps the people who do public works as part of their restitution could be exempted.

 

Mr. Adler:

I believe it would be cleaner just to list the categories: prison, jail, or restitution, because they are all supervised, and we have not had a problem in 20 years.

 

Vice Chairman Washington:

Please get together with Mr. Anthony or Mr. Wilkinson to work out the changes.

 

Mr. Wilkinson:

Mr. Vice Chairman, I just had one point I wished to make regarding A.B. 419 and its applicability. This goes into chapter 118A of Nevada Revised Statutes (NRS), which does not apply to low-rent housing, anyway. It also would only apply to employees of the landlord who worked full-time, 36 hours or more per week, and who have access to all dwelling units.

 

Mr. Adler:

These individuals work 40 hours per week, and they do enter apartments to clean the carpets. I do not know whether that is access.

 

Vice Chairman Washington:

Please get together with Mr. Wilkinson and work through this concern.

 

We will close the hearing on A.B. 419 and open the hearing on A.B. 274. I would like to note for the record, the committee received a letter from Marshall L. Schultz, who was unable to attend, addressed to Assemblyman Goldwater, expressing support of A.B. 274 by Residents Information Center, Incorporated (Exhibit C).

 

ASSEMBLY BILL 274 (1st Reprint): Increases length of notice before person who is 60 years of age or older or who has disability may be evicted from certain periodic tenancies under certain circumstances. (BDR 3-1128)

 

Assemblyman David Goldwater, Assembly District No. 10:

I would like to give you a little of the genesis of A.B. 274, which I am proud to present to you today. I was contacted in Las Vegas by an attorney, who was retained by a constituent of mine and Senator Wiener’s, who said his client was being evicted and was all right with the eviction, but needed a little more time. He was being evicted from a senior housing apartment complex. The tenant needed extra time because 30 days was not long enough for somebody who is a little slower and needs time to find another dwelling with all the amenities that serve seniors. He had lived in the complex for quite some time, and the simple task of moving was difficult for somebody of advanced age, and sometimes, disabled. I know when I moved, I could call my friends, and I might have two or three out of the thousands of those who pretend to be my friends, show up to help me move. When you get over the age of 60 or 65, your friends do not rush over to help you move.

 

I believe we can stipulate it takes a little more time to move when you are older. My intent with A.B. 274 is not to address no-cause evictions in this State. I have attempted to do that in the past, and I have been unsuccessful. However, I have reached some reasonable compromises in chapter 118A of NRS in past legislative sessions. This happened to be a unique situation, which pointed out a very simple fact: a senior citizen needs a little more time to move on. I did not believe I would have any opposition to A.B. 274 because it seems so simple. For your benefit, the two arguments against the bill in the Assembly Committee on Judiciary were first, its potential violation of the Fair Housing Act, because there are age discrimination issues, testified to by an attorney in Las Vegas. The director of the Fair Housing Coalition, as well as a number of attorneys, reviewed A.B. 274, in that form, and said it was not a violation of the Fair Housing Act.

 

The next argument I found bizarre. Opponents said they needed a 30-day eviction for the benefit of the senior citizen. According to their argument, there were senior citizens who would not leave and it was hurting them to not be evicted. It was not to the seniors’ benefit for them to stay any longer than they could. They needed to be evicted in 30 days. I reviewed that with a number of advocates for seniors, and we came to the conclusion if a senior citizen was harmful to himself or herself and to others, we would recommend they be evicted in 1 day. We would change that 30 days to 1 day. Additionally, if landlords are having trouble with seniors who are harmful to themselves or to others, we recommend something other than the eviction statutes to deal with the problem. The eviction statutes are not a place to deal with incompetent, disabled, or severely disabled senior citizens who are harmful to themselves or to others.

 

What A.B. 274 says, and the compromise reached in Assembly Judiciary, was not that a landlord had to allow a senior citizen or a disabled person to remain 30 days extra in his or her apartment, simply the senior citizen could ask for 30 extra days, and the landlord has every right to say, “No.” Upon that denial, the senior then has the right to go to court, where he or she can ask the judge for 30 additional days. The judge would have the discretion to grant an extra 30 days. If that is not reasonable, I do not know what is. All of you have senior citizens as constituents. Hopefully, this is never an issue. The incident I pointed out may have been an isolated incident, but most of the time, somebody gets a 30-day notice on his or her door, and they just shut up and leave. When the person is older and receives an eviction notice, it is a pain in the neck. An extra 30 days to find an accommodating place to live would be to their benefit, to your constituents’ benefit. I have a group of people with me today who would like to testify as well.

 

Senator Nolan:

A landlord’s interest, obviously, is in seeing he or she has full occupancy of the dwelling he or she is trying to rent. In some cases, evictions do not come easily. There is usually some type of cause for them. I also understand there are some seniors who have issues and problems which may create a safety hazard, which is one thing; but in some cases, they may become a nuisance. If the landlord, whose interest is keeping good tenants in his or her building, decides to evict somebody, should he or she not have the right to evict that person?

 

Assemblyman Goldwater:

That is an excellent question. You are right; they do have the right, and they would have the right under A.B. 274. In this State, when a lease or another arrangement governs you, this statute does not apply. These are no‑cause evictions, which are allowed in this State. When a landlord seeks a good tenant, even if he or she is the worst tenant in the world, even under current law, he or she has 30 days to be evicted, or 5 days in some instances. That would not change. Assembly Bill 274 just says in the case of a 30-day eviction, the tenant has the right to ask to stay in his or her dwelling 30 more days than they would under current law; not the right to stay there, but the right to ask.

 

Vice Chairman Washington:

I was just reading the background. The bill was amended for “no cause.” Give us an example of a no-cause eviction.

 

Assemblyman Goldwater:

A good example is you are living in an apartment; I do not like you because of whatever reason. I do not have to give a reason. I put a pink notice on your door that says, “Move out of here in 30 days.” Senator Washington, you, probably more than anybody else, can understand how sometimes in this State the landlord does not have to give a reason to evict tenants, and does so for a number of reasons, using the 30-day, no-cause eviction rule.

 

Senator Care:

What we are talking about, of course, is where you do not have a lease for a term of years, or 6 months, or whatever. You have a periodic tenancy, and for no cause, you can tell somebody, “I want you gone by such and such a date.” There are a couple of things I need to know. First of all, I am somewhat reluctant to endorse legislation based on a single incident. Perhaps Mr. Spitler can testify the problem is more pervasive than what I am aware of. Secondly, in your case, Mr. Sasser, the reality is when you get into justice court, when you think about the scenario and the landlord says no. Now the senior has to get an attorney, file some sort of complaint, and the landlord will have a few days to answer. The matter will be set for a hearing, and there may be an order to show cause. I am just wondering how many days it will take to get in front of the judge, when you are only seeking a 30-day extension. Those are the two issues I need addressed.

 

Larry L. Spitler, Lobbyist, American Association of Retired Persons (AARP):

I am the associate State director for advocacy. I do not believe we have statistics in terms of the number of days. In the testimony I plan to present, I actually went back to the days when I was an Assemblyman, and prior to the most recent reapportionment redistricting, Assemblyman Goldwater and I represented, I believe, districts with the largest concentration of apartments in the State. Therefore, we have a lot of experience in terms of knowing the problem exists, in terms of walking door-to-door and walking in complexes. I am not sure anyone has a hard number they can cite, “This is quantifiably what it is.” When I would go door-to-door or when constituents would call me, it was amazing how many times senior citizens would leave items behind in a friend’s apartment, and then the friend would never see that person again. It concerns you as far as caring about other people, and not knowing what happened to the person. I cannot give you a number, but in those two districts, we often shared constituents because people living close to the borders were not certain who represented them; I believe the problem is more common than most people realize.

 

Assemblyman Goldwater:

It is not an isolated incident. There are some great landlords, and if you passed ten bills like A.B. 274, it would not affect any of the landlords who work with tenants and understand their needs. The problem is, once in a while, you run into the situation of an abusive property manager. Usually it is an out-of-state owner who hires a dictatorial property manager, which happens a lot. You can see patterns. I get calls all the time. It is not even the calls I get or the people who retain attorneys, because that usually is 10 percent of the problem, or one person out of ten. It is the nine other people who do not even know my name, who get an eviction notice on their doors and realize they must get out.

 

Senator Care:

Do you know the name of the complex where this has happened?

 

Assemblyman Goldwater:

I do not want to mention any names.

Senator Care:

I am just the opposite. I like to give them publicity because I believe a responsible landlord will work with a tenant, usually. That is obviously the simple way out.

 

Jon L. Sasser, Lobbyist, Nevada Legal Services:

In response to Senator Care’s question as to the need, I would like to defer to two witnesses who will follow me, one with the Center for Independent Living, who works daily with clients with disabilities, and the other with the Washoe County Senior Law Project, who works daily with seniors who are served with 30-day eviction notices. I believe they will be able to well document the need and give you a number of examples. As to your second question of how to get in front of a judge, there are a couple of ways. The way the law currently works is if I get a 30-day, no-cause eviction notice, at the end of the 30 days, if I am still there, the landlord then gives me a 5-day notice to either get out or file an affidavit with the court saying I have a right to be there. A tenant without an attorney would use the self-help forms and say, “I am still here because I want an extra 30 days, and the landlord did not give them to me.”

 

In addition, the way A.B. 274 is worded, the tenant could also petition the court. I assume the justice courts would work out some self-help forms, as they currently do with most landlord-tenant matters, to allow the tenant to get in front of the judge and deal with the issue in an expedited manner. At least in Washoe County, there are self-help forms for everything in the landlord-tenant arena, and I assume they would cover this as well. I believe the chairman of the committee received an e-mail from Judge Dannan of the Reno Justice Court, saying the justices would have no problem dealing with their roles in this bill. I do not know if other committee members received it yet.

 

Senator Care:

That is the particular language: “the tenant may petition.” You have a senior who may or may not have dealt with the courts before. Landlord-tenant cases are not always that cut-and-dried. It can be a little confusing. Tenants may not be aware of the self-help form, which is another thing we need to talk about. If we enact A.B. 274, how do we make the information available? I do not know if we could require the landlord to make the form available. We could do this, but we would still have the other half of the process, which is going before the court.

 

Mr. Sasser:

I believe the way the bill is worded in the 30-day notice, the landlord must give the tenant the right of notice to request the extra 30 days. I believe it could be expanded to say, “If the landlord says no, you have the right to ask the court to review it.” That would be one way to deal with it. Also, in terms of getting advice, the Washoe County Senior Law Project is here to advise senior tenants in these situations. If they do not appear in court, they can at least give guidance regarding how the system works. There is a similar project to assist tenants in Las Vegas.

 

Senator Care:

I believe the 30-day notice, pay or quit, has something like that in it. I guess you could do it that way.

 

Charisse Earhart, Southern Nevada Multi-Housing Association:

Mr. Chairman, I hope both you and your committee members received the letters and information we sent via e-mail with regards to our opposition to A.B. 274, I wanted to point out a couple of things and then turn it back over to the people we have in Carson City. First, in reference to what Senator Nolan said, I can assure you we, as landlords, want full occupancy and do not use the 30-day, no-cause in any type of way as far as to decrease occupancy. That being said, the 30-day, no-cause can only be given at the end of a lease and/or if the resident chooses to go on a month-to-month basis, where they also have the right to give us 30 days’ notice. It works both ways; it is not available to us on an interim basis throughout their lease term.

 

As far as the residents going to court and only having an extra 30 days available to them if they ask for it, court does take time. As an association, anytime a resident calls our office, we do give the self-help number out, so we do provide that type of information. However, I worry if they assume they are going to be given an extension, they would not begin to prepare to find another place to live, causing them to further delay looking for another residence. Secondly, we failed to address a couple of other issues addressed in the bill. One, the age is 60 years or older or a mental or physical handicap. Mental and physical handicaps have not been addressed at all. That is what we believe may put the landlord into a precarious situation, actually due to federal fair housing, where landlords do not have the right to ask if there is a disability of anyone protected by federal fair housing, whether the issue is race, religion, color, sex, handicap, or whatever. They do not have to disclose that either, if they choose not to. In dealing with that aspect, I believe we are, at best, walking the line with federal housing law.

 

We have sent many letters to you. There are many people here representing our association and the Department of Industry, in opposition to A.B. 274, and I hope you will take that under consideration.

 

Kris Bellister, Washoe County Senior Law Project:

I am a paralegal at the Washoe County Senior Law Project. We work with low‑income and disabled seniors during their eviction processes. I am here to give you an idea of the kinds of problems that make seniors’ issues different from those of the younger population when they receive a 30-day, no-cause eviction. If you or I receive a no-cause eviction, we jump in the car, go find a place to live, take money out of the bank, and move. The senior we had last month was 81 years old. She received a no-cause eviction because her condominium was being sold. She had osteoarthritis and could barely move, she had no transportation or money for moving, and had nowhere to go. These are the kinds of problems a 60-day notice or additional time frame would solve, by giving seniors time to locate money, transportation, and appropriate housing.

 

The senior also has a value system that was being challenged by an eviction notice. When seniors receive an eviction notice, it can make them believe they are something less than human; they are devastated, humiliated, and lose their self-esteem. They go through a grieving process, consisting of denial, anger, and acceptance before they can even begin to address the eviction notice. By this time, you and I have already located a place to live, taken money out of the bank, and are well on our way to moving. The senior is still trying to deal with his or her loss of self-esteem for his or her generation’s value system. Once they are ready to act, they encounter four problems we do not believe are faced by the younger generation. They are slower to deal with problems because they are emotionally overwhelmed, or they are physically impaired. They have no transportation, no money, and there is little affordable housing.

 

Seniors and the disabled need time to think things out and to locate help. The 30-day notice does not give them enough time. The result is they become so stressed they do not know what to think. This takes up valuable time they should be using to formulate a plan. The 60-day notice, or an additional 30-day notice is kinder and acknowledges their need for time to develop a plan. Transportation issues faced by seniors are: most of them do not drive, so they have to facilitate a move on a bus or city lift. Failing that, the senior must impose on someone to take him or her around, which is also a challenge to the senior's generational value system. It is difficult to find housing this way. Aside from the inconvenience of not driving, transportation costs are not usually a part of seniors’ budgets. Our office frequently has to give out free bus passes and taxi vouchers just so seniors can go look at housing options. An additional 30 days would accommodate the transportation problem. Once the senior finds a place, he or she cannot throw his or her possessions into a car, because he or she does not have one. Nor can he or she move his or her possessions by city lift. There is no moving assistance for people on low incomes. Many have no family, friends, or support groups. An additional 30-day notice would give these people time to find transportation help.

 

People on fixed incomes mostly do not have savings or other money to fall back on. When they pay their rent and receive a 30-day notice, they are not prepared financially to move. They need additional time to find resources for the credit report, deposit, and first and last months’ rent. When there is not enough time to save for such an event, the senior either taps into community resources for rent money or must find a landlord willing to spread out the deposit and last month’s rent over time. An additional 30-day notice would give them time to find these resources. For seniors and the disabled on fixed incomes, affordable rental units in Reno are hard to find. The affordable housing complexes usually have a 2- to 6-month waiting list; sometimes the wait is 2 years. Other factors concerning seniors looking for housing are proximity to bus lines, grocery stores, the ability to stay in the area they are familiar with, and remaining in a good neighborhood. They consider all these things when trying to find housing within 30 days.

 

There are helping agencies in the community, but it takes time to get needed help organized. A 30-day notice creates a crisis situation for all the social workers and agencies involved because they have to prioritize the eviction over their normal, heavy caseload. An additional 30 days would diminish the crisis situation considerably. It would allow those in the trenches to help seniors find transportation, money, and appropriate housing. We would appreciate your consideration of an additional 30 days because it is kinder on the elderly and disabled, and because it is the right thing to do.

 

Vice Chairman Washington:

You make it sound as if there is a tremendous crisis, but I am wondering if most landlords are not sympathetic to senior citizens, and would grant extended time without going through this provision or putting it into statute.

 

Ms. Bellister:

I believe a lot of landlords would grant an extension.

 

Vice Chairman Washington:

Perhaps landlords would even aid and assist seniors in their move.

 

Ms. Bellister:

Right, but it is the ones who do not allow them an extension with whom we are concerned. It creates a terrible nightmare, both for the tenant and the agencies trying to help them. If they have to do it all in 30 days, along with their regular caseloads, it is almost impossible.

 

Vice Chairman Washington:

How often does your agency run into the problem?

 

Ms. Bellister:

Quite frequently; this month we had five such cases. When you try to manage a regular caseload of about 200 cases, plus devote the necessary time to helping these people and organizing agencies to help, it is a nightmare.

 

Robert Desruisseaux, Northern Nevada Center for Independent Living:

Everyone else who has testified has done a good job of explaining the difficulties that go along with moving when you have additional circumstances such as a disability. I believe Assemblyman Goldwater addressed one of the things people with disabilities must do, which is find amenities within their new housing that will meet their needs. As far as accessible housing stock, I am not even going to address affordability; the amenities needed by disabled individuals are not readily available. A person may be evicted from a dwelling in which he has installed amenities and would be required to remove them. This is complicated by the disability, transportation, travel, and the manual labor required to remove and replace amenities. Once a disabled person finds new housing, if it is not accessible, the amenities will have to be reinstalled. I have conducted the independent living program for the last 6 years for the Center for Independent Living and have worked with contractors in making home modifications. Trying to get a contractor to show up at your house to put in a grab bar is like pulling teeth. It is a small job, and even under the best of circumstances, 30 days is a nearly impossible time frame.

 

I have moved several times in the last 12 years. I am actually pretty young, healthy, and not too limited in my mobility. I have had a difficult time moving within 30 days. Generally, I have left a piece of the puzzle out, normally the amenities I would need in my new accommodations. So, there are safety risks involved as well. I would like to address Ms. Earhart’s comments regarding asking for disability information when requesting an additional 30 days. I would like to point out, it is voluntary. When a person requests 30 days, he or she submits that information; the landlord is not requesting it and it is not a violation of fair housing law. It is also not a requirement the tenant be given the 30 days. It is optional, and the information is voluntarily provided.

 

I would also like to point out there are many factors, in northern Nevada specifically, that complicate things, such as the lack of accessible housing. There is not a lot of available accessible housing. Generally, the accessible housing is filled. I believe, under the best of circumstances, 30 days makes a move nearly impossible. I would challenge anyone in this room to try to accomplish what it takes to move a person with a disability in 30 days.

 

Mr. Sasser:

I just want to briefly address the fair housing question, as to whether A.B. 274 would violate the fair housing law. In my opinion, the answer is no for a couple of reasons. One, age discrimination is not a suspect class under fair housing, so that is not an issue on the seniors’ side. Secondly, for both seniors and people with disabilities, the way the bill is now worded, there is no issue where the landlord has to seek or ask for information. Disabled people or seniors who want to avail themselves of this process voluntarily seek and ask for it. I do not believe there is any problem with the federal fair housing law, and I believe Mr. Howard has a letter from the Fair Housing Center in Las Vegas to that effect.

 

David Howard, Lobbyist, Northern Nevada Apartment Association, and Southern Nevada Multi-Housing Association:

We are before you this morning to oppose A.B. 274. We have, as Assemblyman Goldwater suggested to you, the past three sessions, made every effort to work with him on issues concerning the tenant-landlord section of the law. I believe we have been doing that in good faith, and I am pleased with the success we have had. However, this bill troubles us for a number of reasons. The original version of A.B. 274 spoke to periodic tenancies where the tenant is 55 or older. The reprint and amendments, in which we did not have the opportunity to participate, go into other areas. I believe it is unfortunate we have to bring in old age, mental and physical disabilities to do what we are convinced this bill is trying to do. We disagree with Assemblyman Goldwater’s contention this does not address the 30-day, no-cause notice. This bill, if passed, will make it a 60‑day notice.

 

Assemblyman Goldwater made the point the court has discretion once it goes to court; that is not the case. In line 41, page 2, of A.B. 274, it says the court shall grant the petition if the tenant submits proof he is entitled to such an extension pursuant to subsection 2. To me, it is not discretionary; it is mandatory. All a person would have to do is go to court and show his driver’s license indicating he is 61 years old, and it would be granted. We disagree this is not a foray into the 30-day, no-clause issue of the law. We believe it is a step toward that direction. It is unfortunate we have to bring in issues this Legislature has addressed time and time again, taking care of the elderly through elder abuse laws, mental and physical handicaps, which you address in many other areas of the law. This is not the part of the law in which you should be addressing those issues.

 

We have some people who would like to speak, but before they do, I would like to make one single point about seniors, being one myself. We are some of the best tenants landlords have. In fact, some landlords will give a discount on the deposit to attract seniors because they are, in fact, our very best clients. Keep that in mind as we bring up people who have practical experience I hope they will share with you on this bill.

 

Senator Care:

What happens when you have cotenants, such as someone who is 61 years of age living with someone who is 58 years old? The second issue, unless there is already a provision in law addressing this, the worst-case scenario would be if the judge says, “I hereby find the senior has to go.” Does that mean the senior has to vacate the dwelling immediately, within 72 hours? I would think the senior would have to have time to pack and prepare to go, or would he or she be tossed out on the sidewalk?

 

Valerie Hand, Gaston and Wilkerson Management Company:

I manage a 300-unit property in Reno, and I am here on behalf of my management company, Gaston and Wilkerson. As far as two different age groups, if you do any kind of eviction, you are doing it for all people in a dwelling; you are not separating them out. If one would get the extension, they would all get it, as far as age goes. As far as giving a 30-day, no-cause eviction, Assemblyman Goldwater pointed out to you, Senator Washington, that I could give you a no-cause just because I do not like you. I guess I could, but if you went to court and said, “It is because I am black,” I had better have some good documentation proving that was not the reason for your eviction. Number 1, a no-cause is not really a no-cause eviction, because if I have to go in front of a judge and give my reasons, they had better be good or I will probably lose. Number 2, I am not clear on the difference between a senior who is getting a 30-day, no-cause eviction notice, and a senior that did not pay his or her rent and gets evicted.

 

Assembly Bill 274 states seniors and people with disabilities need extra time. First of all, if I gave a no-cause, and somebody needed extra time, I would work with the senior, and I believe a judge would work with the senior. Beyond that, if this was a non-payment issue, the judge has no way of giving the person extra time. If it is a lease violation, the lessee does not get extra time, so what is the difference between those issues and a 30-day no cause? They are all the same thing. If a senior needs more time, he or she needs more time, regardless. I do not know why this is being singled out, and proponents are saying if a senior gets a no-cause, he or she is going to be devastated. If the senior gets a 5-day pay or quit and does not have the money, he or she is going to be devastated, and would not get extra time under those circumstances.

 

Another concern I would like to address is A.B. 274 does say an additional 30 days, not up to 30 days. If we went before a judge, and this passed, we would automatically have to give the person 30 days, when maybe he or she only needed 7 extra days. I believe most landlords would do that for the tenant anyway. I would do that for anybody. Finally, I would like to address the fact A.B. 274 says any physical or mental disabilities. What is defined as a mental disability? Is it a person with attention deficit disorder, or a person who is bipolar? Almost anybody, if the definition were broad enough, would qualify under something. I am sure I could go to the doctor and get some kind of mental disorder diagnosed if I needed to. I believe it is too broad, and it is unfair to the landlords. That is why we had the 30-day, no-cause, not so it could be made a 60-day, no-cause.

 

Vice Chairman Washington:

I just saw something in here that was pointed out, the court shall grant the petition if the tenant submits proof he is entitled to such an extension pursuant to subsection 4, page 2 of A.B. 274, which says the court may grant such other relief as is deemed appropriate. So the 30 days could be extended to 60, 90, or 120 days, or it could only be a week, depending upon what the court decides. Am I reading that correctly?

 

Mr. Howard:

I am not sure it goes beyond the additional 30 days the way subsection 4 was written, but to grant such other relief as it deems appropriate is pretty wide‑open. I do not know what that would mean to a judge.

 

Vice Chairman Washington:

I would assume if we are dealing with an extension, the judge could go beyond the 30 days, if he or she deemed it necessary, or the judge could go under 30 days.

 

Mr. Howard:

In response to Senator Care’s earlier questions, regarding dual age in tenancy, it would be the perfect opportunity for someone to get rid of his or her spouse. In all seriousness, I believe it is a problem not addressed by this bill. What was your second question?

 

Senator Care:

The second question, let us say 3 days prior to the expiration of the periodic tenancy, the petition is filed and the court denies it. My concern is about seniors who find themselves on the sidewalk right then and there. I am thinking the court has some sort of plenary powers to give the person 72 or 96 hours to pack up, but I do not know if there is already a provision in the law addressing that situation.

 

Mr. Howard:

It is not in this law. There is reasonableness here I believe was overlooked when we started looking at the laws between tenant and landlord. There is a relationship between tenants and landlords that I do not believe was chronicled enough, but it is a business, and there are property rights. There are also personal things that go on between tenants and landlords that are good and are never heard here. We only hear about, as Assemblyman Goldwater said, the unique situations. There are many nonunique situations that go on every day in which people are good to each other, and I believe they are overlooked too often.

 

Shelly Baker, Northern Nevada Apartment Association:

I represent the Northern Nevada Apartment Association and my employer, ERGS, Incorporated. I agree with those testifying in Las Vegas, and with what Mr. Howard said. I would like to share with this body that I manage two apartment communities in the Reno basin, which have 470 apartments. I advertise, “No deposits” for seniors. I purposely want them to move into my communities. A current situation I have involves a household with a husband and wife. The husband is 60 years old. A month after moving in, complaints from the neighbors, who have been there for an average of 2 years each, started coming in. They can hear the husband cursing extremely loudly and using foul language against his wife, generally against her gender. I finally filed a breach of contract after sending four notices to this household asking them to keep their voices down and not force the neighbors to hear. We ended up in court before a Reno Justice Court judge, who heard the husband’s testimony, which was that his wife needed medication for her depression. He said his wife was now taking medication and would be better. He claimed it was not him cursing at his wife and degrading her, but it was her cursing at herself and the cat.

 

The neighbors provided testimony to the effect that was not what was happening. They said they heard the male’s voice saying these things, and they heard the muffled, whimpering cries of a female. The judge stayed the conviction for 2 weeks, and said if there were no other complaints from the neighbors, the couple would not have to move. Two and one-half weeks later the complaints started again. When his lease is up, we intend to give him a 30‑day, no-cause eviction for disturbing the neighbors. The neighbors are not happy in their current environment, and I face losing three apartment rentals instead of one.

 

Mr. Howard:

We have people who have traveled from Las Vegas to be with us this morning.

 

Ms. Earhart:

With regards to the 30-day notice and the extension to a 60-day notice, I believe we failed to take into account, if the tenant has not moved at the end of his or her 30-day notice, there is a law already in place requiring us to give a 5-day notice. It would go through the court system. The law does provide for additional time if the tenant chooses not to move. We understand we cannot, with a 24-hour notice at the end of the 30-day time frame, just kick them out.

 

Natasha Larsen, Carefree Senior Living:

I am here on behalf of Carefree Senior Living in Las Vegas, and I am also associated with the Southern Nevada Multi-Housing Association. As a 55 plus senior housing provider, our stance is A.B. 274, as amended, is a detriment to residents in our communities. In our course of business, service of the existing 30-day notice typically transpires as a need for the resident to relocate due to health issues. Often seniors are with us for several years, and their health diminishes. At the end of their leases, often we realize they are not able to care for themselves, and unfortunately, many times they do not have family in the state. They seldom have anyone to turn to. Therefore, we serve the 30-day notice because they can no longer care for themselves or provide for their daily needs. Unfortunately, the only way to make sure they understand they need to move on and get further care, because we do not have any medical assistance in our apartment facilities or care facilities in which a caregiver could check on them, is to serve them with a 30-day, no-cause eviction.

 

The elderly residents always deny they have reached the stage at which they need to move on and get further assistance. Oftentimes we have to get adult protective services and/or Aging Services Division involved to assist us. They will come out to assess the individual. Unfortunately, frequently the aging person diminishes so quickly, or was an elderly person who had been hospitalized and often back in the hospital after 2 weeks. Passing A.B. 274, and making the time limit 60 days, will only cause the person to be in an unsafe situation for a longer period of time. In one case, we attached letters showing there had been a situation in which a resident was served a 30-day, no-cause because he did not have any family, and needed further assistance. Unfortunately, 2 weeks later we found the individual passed away in his apartment.

 

Extension of the 30-day notice could be a detriment to these individuals’ safety and the safety of our other residents. They are trying to cook for themselves, take care of their medical needs, and so forth. A couple of months ago, a resident served a 30-day, no-cause eviction notice had a small kitchen fire 2 days after receiving the notice. Thankfully, a maintenance worker was close enough to put the fire out before it spread to the entire building.

 

Assembly Bill 274 states an additional 30 days would be allowed if the tenant provides proof of his physical or mental disability. As a senior apartment provider, our largest turnover demographic is from medical situations. Residents can obtain a doctor’ note for any reason, justified or not. The proposed bill places the housing provider in a position of further judging the resident’s health based on an, often false, doctors note. Apartment communities do not have licensed medical professionals on staff and are not qualified to assume this responsibility. As we have presented, passage of A.B. 274 is not conducive to the well-being of our seniors, or to the processes necessary to provide them with quality living.

 

Senator Nolan:

You indicated probably the most prevalent reason why you would evict somebody is based upon reasons of their health care, whether physical or mental. They have been deteriorating and now they need to seek some type of further care. Is there anything that compels you, either by ordinance or law, to help somebody when you realize they have deteriorated in their medical functions or capacities, find assistance? I believe you testified you do that, but is there anything that compels you, or is that something you take on yourself?

 

Ms. Larsen:

Unfortunately, there is no law stating we have to assist a medically deteriorating resident. As a senior housing provider, and because of the fact we have over 2000 apartments, we contact adult care services, Aging Services Division, and adult protective services and let them know the individual has no family, and we need State assistance. One of those services comes in and evaluates the person’s situation. Often they come in and perform an assessment after quite a bit of time has passed, since they have large caseloads. While I am waiting for someone to come and assess the individual, I still have a resident living alone on a daily basis, which puts us into the predicament of having to check on the individual and become caregivers. Again, we have no medical staff, and it puts us into a quandary as to whether to call 911 every day, or try to contact adult protective services every day, and explain we are in a bad situation and need someone here. Oftentimes, we are lucky because there are family members in the state. They often do not realize mom or dad has deteriorated to such a point. We contact relatives even out of state to advise of their relative’s condition and request their assistance. Often the children of elderly residents with medical problems do not want to come to assist their parents because it is a detriment to them as well.

 

Senator Nolan:

We realize State services are pretty strapped, and you said sometimes you are lucky to get them to respond. Are there times within the 30-day period they do not get assistance, and the tenant just has to pack up and meet the terms of the eviction?

 

Ms. Larsen:

Yes. Oftentimes when they realize the State is not going to assist them or the fact they have no family, again, because we are such a large senior community, we have personal transportation to take the senior and help him or her find another apartment. We are not going to throw them out into the street; we assist as much as possible. We will help with moving and scheduling movers to come out and help them. We take it on a case-by-case situation. Unfortunately, if it means leaving them in the apartment, and we know they are not safe, we have no other opportunity other than to go with the 30-day, no-cause eviction.

 

Senator Care:

How long have you been with Carefree Senior Living?

 

Ms. Larsen:

I have been with them over 1 year. I actually have been in the apartment industry for over 7 years.

 

Senator Care:

Do you know whether Carefree Senior Living engages in the practice of having seniors enter into leases for a term of years, and at the same time promising them if they do, there would not be a rent increase for a period of 5 years?

 

Ms. Larsen:

What we have are year-to-year leases; we have a 12-month lease cycle, and with that, we have a 5-year rent freeze addendum stating they are allowed to renew their lease on a yearly basis, and if they do so for 5 years, we give them a rent freeze, but it is not a 5-year lease.

Senator Care:

Do you think some of them might think it is a 5-year lease?

 

Ms. Larsen:

We are working on clearing that up. We had one case of confusion. Everyone else had it explained to him or her when they moved in. Oftentimes a rent freeze is not even offered to them until after their first year of being a resident because it is a lease-up property. Therefore, often the 5-year rent addendum is not offered to them until after their initial lease terminates.

 

Senator Care:

Do you know of any other entities in Las Vegas that engage in that practice?

 

Ms. Larsen:

No, I do not.

 

Assemblyman Goldwater:

I am outraged. You have an advocate for AARP, who works every day, not only as a policy maker, but now is a full-time, paid employee of the Association of Retired People, who gets up every morning thinking of how to help senior citizens. He is not up here saying, “I want to help senior citizens by evicting them.” We do not help senior citizens by evicting them, necessarily. If they need help, we have a number of places they can get help. Chapter 118A of NRS, the no-cause eviction statutes, are not where you help seniors. Giving them a little more time helps them. This entire conversation has gotten so bizarre I cannot even believe it. The argument is, “We are helping them by evicting them.” We should shorten the period, then. I would be the first one to say, if I truly believe eviction helps seniors, “Let’s not make it 30 days, let’s make it 2 days.”

 

The other argument is, we cannot go into the no-cause, we cannot do this, and we cannot do that. There is not one landlord I can think of, if he or she is doing his or her job right, to whom this bill, if passed, would even matter. If this bill was passed into law, and you were a decent landlord, you would never know it was there.

 

Donna Harris:

I am a landlord. I own property here in Carson City. I do not own one of those huge conglomerate apartment complexes; I am a little, small guy, and I own 34 town homes. I have worked very hard to get where I am today. I oppose A.B. 274, because I believe a 30-day, no-cause allows plenty of time for any person at any age to move. I have been in this business 10 years, and I have not met one person who is so incapacitated they cannot move in 30 days. I rent to an 85‑year-old lady, who is as sweet as can be. If she had to move today, I know she could. There are many apartment complexes and conglomerates that have a lot of money, but I am a little guy. Here is a scenario, let us say this bill is passed. As a property owner of two houses, I may need my house back because I lost my job. Does that mean I have to, for 60 days, go live on the street because I cannot move back into my house because I have rented it to somebody else? Is that fair? I do not believe that is fair.

 

Also, who says senior citizens are good tenants? They are, for the most part, but I have rented to bad tenant senior citizens, too. There is a lot of fraud that goes on. You can get senior citizens who move in and put their name on the lease, and then they move out, have their grandchildren move in, or their mother, or sister, or someone younger. I believe Assemblyman Goldwater is responding to one person who had an unfortunate incident, and I do not believe that happens all the time. I personally do not give a 30-day, no-cause because I do not like someone. I have never done that. If I give a 30-day, no-cause eviction notice, or a reason to move, it is because the tenant has done something wrong.

 

Roberta Ross, Owner, Ross Manor:

I am a landlord at the Ross Manor Residential Hotel and Apartments in downtown Reno. I have worked in the business since 1985. I do both weekly and monthly rentals. I want to say there are a lot of bizarre circumstances. There are a lot of senior agencies that work hard to help senior people. One senior died while I was working hard with senior agencies to come in and help him. It was within a matter of hours of when I called and asked them to come and help this person I had been working with for months, that he died. The people came with notebooks within the next 2 hours. They wanted to be there to cover themselves for the person who died, but they could not be there earlier, when I started making phone calls at 4 a.m. I am a decent landlord. There are a lot of decent landlords. Right now, I have an 86‑year old woman tenant, and if I had been a little more aware, I would have taken films of her yesterday. She was sitting in my lobby, crying, and planning to walk in front of a truck to kill herself. This was not the first time I have dealt with this; I have been dealing with Marie for years. I have called social services for years.

 

The woman from social services is right. She called them people in the trenches with a lot of work. They cannot get to these people fast enough, but is it the landlord’s responsibility to become a social worker when our social agencies are so booked they cannot come here? I am not blaming the social agencies for not being able to come soon enough, because I know of their huge workload. I can respect that, but as a landlord, these situations happen. I invite each and every one of you here to come to the Ross Manor today. I will introduce you to Marie. I will show you the records from the Fire Department from when Marie accidentally started a fire in her apartment. I can show you my logbooks that were months old showing that Marie would not leave her room when there was smoke in it. So, yes, these circumstances do happen. Please come and visit the Ross Manor. I am proud of my business and my tenants. Please do not force me to become a social worker in regard to taking this out 30 days further.

 

I have read A.B. 274, and maybe I do not understand it. It sounds like the bill is for 30-day, no-cause eviction notices only. In section 1, line 3, the bill talks about an unlawful detainer. My understanding is unlawful detainer goes for cause and for no-cause evictions. This is not, as far as I can determine, for no‑cause only. I ask that you review the bill and look at that section closer to see if that is actually the issue. There are a lot of people 60 years and older who are smart, coherent, and know what they are doing. If they are in an apartment situation and they have been there for sometime, or if they are just there now, usually at that time in their lives, they may be struggling to get through.

 

Do not discount this 30-day, going into a 60-day notice, will become a tool for these people to use to get free rent longer if they go back to court. They currently have the ability to go to court, when they get their eviction notice on the door, and refute it at that time. If we, as landlords, were wrong, the tenant can try to prove we were wrong, and take senior services with them to court to show we were wrong. The judge will commonly ask if the tenant needs more time, or if the landlord will give the tenant more time. That is a common question for the few times I have taken my tenants into eviction court. There is already a law in place to help these people.

 

Ruth Wheeler, Wheeler Enterprises:

I have 150 rental units in downtown Reno, and I will try not to repeat what everybody else has said. Seniors and disabled persons are sought after tenants. I go out of my way to recruit tenants from these groups. If there is a problem on a normal, no-cause eviction, such as the apartment has to be given up for some reason through no fault of the tenant, and the tenant needed 30 additional days, obviously, I am going to work with those people. Unfortunately, we are talking about unlawful detainers. Unlawful detainers have to be filed after either a no‑cause eviction or a nuisance eviction. Non-payment, as far as I can tell in reading A.B. 274, does not even enter into this.

 

Of particular concern is the nuisance eviction. I have served it for illegal behavior, threatening, or bad behavior, and health hazards. They do not just affect me; they affect all the tenants surrounding them. You are not just asking me to put up with this problem, you are asking a lot of people, who live around the offender, to also put up with him or her. Very likely I am going to lose tenants if A.B. 274 passes. That has certainly happened to me in the past. Being over 60 or being disabled, unfortunately, does not mean they are all right renters. Drug users are considered disabled due to their inability to work. Everyone needs a roof over his or her head, but these people can be a threat to their neighbors by virtue of their traffic if they are active. Everyone would agree no one should have to live next door to a nuisance, such as this. Oftentimes, you would say, “Just call the police.” I am sorry, it does not work that way because it has to be witnessed, and that sort of thing. A nuisance eviction for continual traffic problems is often the easier way of dealing with drug trafficking.

 

I have disabled people who are participants. This bill was never aimed at those people, obviously, but these are the kinds of people who could take advantage of it. I believe for the seniors we are talking about, the ones who really need help, we are already doing that. We do it on a voluntary basis because we are human beings and do not need a bill to tell us who needs help and if they need extra time. I am against passage of A.B. 274.

 

Vice Chairman Washington:

We will close the hearing on A.B. 274. We will now open the hearing on A.B. 397.

 

ASSEMBLY BILL 397 (1st Reprint): Makes various changes concerning proceedings in actions concerning eminent domain. (BDR 3-1082)

 

Assemblyman William Horne, Assembly District No. 34:

I will read my prepared testimony (Exhibit D). Here to make a more thorough presentation are Jim Leavitt and Laura Fitzsimmons, attorneys who practice in this area. There will also be testimony from Assemblywoman Vonne Chowning and Aimee Tucker, who have personal experiences with the chilling effects of offers of judgment. I would like to state as an amendment, which was not done on the Assembly side, the word “person” should be changed to “party,” on page 2, line 4, of A.B. 397.

 

Senator Nolan:

I probably should disclose Assemblyman Horne and I were in the same fraternity together, and although we lived in a house that should have been condemned, or we wish would have been taken under eminent domain, I do not believe this will affect me any differently than it would any other member of the Tau Kappa Epsilon fraternity, so I will participate in the discussion.

 

Assemblywoman Vonne Stout Chowning, Assembly District No. 28:

This is a very serious issue to me, and I am appearing in strong support of A.B. 397. Let me tell you my personal story. A few years ago, my husband, Elmer Chowning and I owned a property at the corner of Cheyenne and Civic Center in North Las Vegas. The reason we had purchased the property a few years before was for the purpose of an investment property that, hopefully in the future, we might use as a small real estate office. There are hundreds of thousands of cars that come down Cheyenne from the interstate trying to get to the community college. Day and night, the din of traffic noise was unbearable. It was absolutely not habitable any longer for use as a residence. Directly to the east of the property was the North Las Vegas Fire Station. Add to the din of the traffic noise the constant movement of fire trucks. That further prevented it from being optimal for residential use. You can imagine going out into the front yard, where none of your children or pets would be able to be because of the constant noise and travel. We hung onto the property, thinking we would use it as our real estate office. Along came the State of Nevada who said the property was going to be taken under eminent domain for expansion of the freeway.

 

Imagine my situation, being an Assemblywoman and chairman of the transportation committee. I never said a word. Never, until the horrible experience was finished, did I ever say a word. This was a three-bedroom, two‑bathroom property, with a fireplace, two outside patios, and approximately 1200 square feet, if I remember correctly. At that time, the market value, even just as a residence, would have been approximately $100,000. Dealing in real estate, I sell properties all the time. The offer given to us was $65,000, with errors you could not believe, in the appraisal. My husband and I said, no. This was not acceptable and noted the various problems with the appraisal. The appraisal did not even list the fireplace or patios; I am convinced the appraisal was a drive-by. No one could have entered the property without seeing and noting the upgrades to the property.

 

This went on for a few years, as I remember. I try to block negative things out of my mind, and this was a very negative experience. Ultimately, after three appraisals, I believe because of the many errors, the final offer made was approximately $101,000. We believed the property was worth much more because of the commercial, professional office potential, but we were told the property would never be approved for professional use.

 

Let us fast-forward to today, May 2, 2003. The fire station that was directly to the east is now closed. The property is for sale with the City of North Las Vegas. It is prime commercial property. The property directly to the north is now a hotel casino, Ramada Inn Speedway Casino, prime commercial property directly across the street. We were told if we did not take the final offer, we would have to pay attorneys’ fees, in an amount of which we were unsure. We could have walked away with next to nothing. It was a chilling, coercive effect on my husband and me. Our neighbors, with property to the west, were people who, in my mind, settled for much less than the value of their property. They were, as Assemblyman Horne stated, of the opinion they could not fight city hall.

 

Being a professional, I know exactly how they felt. It felt even worse for us because we thought, “Gee, we are college educated, we understand, we deal with properties all the time, we have trust and faith in the government. This couldn’t happen to us.” But this did happen to us, and the reason we were forced to accept the settlement was because of the potential costs we might have had to incur. We could not do that; we could not just buckle under and accept a settlement then of who knows what, as I said, next to nothing. We also did not want to endure the time and traumatic effects of a trial. It went on for probably 3 years, and who knows how long it would have gone on. To add insult to injury, the statement was made, “I can hardly wait for this case to come forward. Imagine, a real estate broker and an Assemblywoman.”

 

That has nothing to do with this bill, but that is the type of pressure put on people. To my husband and me, who are professional and honest people, it was extremely chilling. You can imagine the everyday person faced with this type of trauma and decision-making, and then being told he or she will have to pay tens of thousands or hundreds of thousands of dollars in attorneys’ fees. What do people do? Naturally, they settle and walk away thinking, “This is the best I can get, and I am darn lucky to get this.” The government should not be so heavy‑handed or intimidating in using tactics such as these. I ask you to support A.B. 397 on behalf of all the people who have to endure these experiences.

 

Senator Nolan:

Assemblywoman Chowning, I am very familiar with the area you are talking about. I was wondering, did your property ultimately become condemned and used as part of the freeway off-ramp project, or is it still vacant?

 

Assemblywoman Chowning:

The property was razed, as they say. It was destroyed; it was torn down. Because a corner of the property was needed for the pavement for the freeway, the property now has a big Cyclone fence around it and a few desert plants planted by the Nevada Department of Transportation. It is totally inaccessible. People can kind of see the gravel and the desert plants, but that is all there is.

 

Senator Nolan:

In your opinion, with your background in real estate, since they did utilize that property as part of the off-ramp project, should the property have been appreciated more? I understand also, the fronts on Cheyenne are becoming commercial projects, and who would have thought they would have had a decent, large hotel right across the street? At the time they were taking your property, that was not happening there. I am just wondering, in light of the fact they took your property, razed it, and used it for its intended purpose, you have given me pause to consider some aspects of the bill. I will not ask you to answer that.

 

Assemblywoman Chowning:

That is all right, Senator Nolan. The value of the property simply as a residence would have been at least $100,000, and we received an offer of $60,000. That was inaccurate, insulting, and offensive. It was the first experience. The property of the people, who ultimately settled for approximately $80,000, was worth much more than offered. This particular property was worth much more because of the potential professional use. In both instances, the appraisals were flawed. It was undervalued as an existing residence, and naturally, with the professional use, it was undervalued as well. In both instances, it was not a fair appraisal.

 

James J. Leavitt, Attorney:

Our practice in the Law Offices of Kermitt L. Waters is primarily limited to eminent domain. Our office has represented over 100 landowners in these types of cases in the past. I am here to strongly support A.B. 397. Let me explain how Nevada law currently works in regard to offers of judgment. The government comes in and takes a landowner’s property and tells the landowner, “Here is a sum certain we are going to offer you.” If they make that offer a judgment, and the landowner does not accept it, the landowner could be liable for the government’s attorneys’ fees and litigation costs. What we are seeing often in these cases is the government is hiring outside counsel instead of using city and district attorneys. They are hiring counsel where the attorneys’ fees and litigation costs are upwards of $50,000, $100,000, or $150,000. If the landowner is held liable for attorneys’ fees and litigations costs, those fees and costs would be subtracted from the landowner’s just compensation award.

 

The landowner does not receive just compensation. The landowner receives just compensation minus the government’s attorneys’ fees and litigation costs. In some cases, attorneys’ fees and litigation costs exceed the entire verdict. The landlord loses his or her land, does not get paid anything for the property, yet receives a bill from the government for the privilege of having his or her property taken. This is extremely coercive. It violates the Fifth Amendment to the Constitution of the United States of America. The Fifth Amendment and Article 1, section 8, to the Constitution of the State of Nevada, clearly provide private property shall not be taken without payment of just compensation. Our Nevada Supreme Court has defined just compensation two ways: that amount of compensation which is real, full, ample, and substantial; and secondly, that amount of compensation which puts the landowner in the same position monetarily as he or she was prior to the taking. If, at the end of the day, the landowner’s property was taken and he or she had to pay the government money, that was not real, full, ample, and substantial compensation, and it certainly does not put the landowner back into the position in which he or she would have been if the property had not been taken.

 

The second reason we believe current law is coercive is because it gives the government an unfair advantage. As you heard from Assemblywoman Chowning, what often happens is the government will make an offer and say, “If you do not take it, you will end up having to pay our attorneys’ fees and litigation costs.” That is a big hammer over the landowners because the government has many more resources to expend in these cases and because the landowner could face economic devastation if he or she does not accept the government’s offer. The landowner does not have the same hammer to put over the government when they do an offer of judgment on the government because they do not have the same resources to expend. If the government does not accept the offer of judgment, it is not faced with economic devastation. These offer-of-judgment rules, as they currently exist in Nevada, work to the gross advantage of the government and to the gross disadvantage of landowners.

 

There have been many questions raised as to why this bill should only apply to eminent domain actions. I will give you two reasons: first, an eminent domain action is based in the constitutions. As I stated, the Fifth Amendment to the Constitution of the United States of America, and Article 1, section 8, of the Constitution of the State of Nevada, provides just compensation must be paid. Just compensation should not be impaired or abridged in any manner whatsoever by a procedural rule or any statute, such as those currently existing in Nevada. That is a constitutional right, which should be unbridled. Landowners should be entitled to present their cases and receive what they believe, or allow the court to decide what is just compensation.

 

Second, a landowner is unwillingly brought into court. This is probably the most important reason why this rule should be adopted in eminent domain actions and not in other actions. The landowner is in court only because he or she owns something the government wants. They have done nothing wrong to be there.

 

The power to take a landowner’s property and take the landowner to court has been described as the most intrusive and harshest aspect of sovereignty, not a violation of the Fourth Amendment, but the right to take property from a landowner. This is because property is the cornerstone of our freedom, and if the cornerstone is taken, we lose our rights. It would be blatantly unfair, unjust, and inequitable, after the government exercises that harsh and intrusive aspect of sovereignty, to allow the government to then dictate to the landowner how much he or she will be paid for the property. If the landowner does not accept it, he or she is going to have to pay the government’s attorneys’ fees and litigation costs.

 

Vice Chairman Washington:

I take it you practice in this area?

 

Mr. Leavitt:

That is correct.

 

Vice Chairman Washington:

How many of your cases, or those you know of, have settled the judgment based on the fact the landowner has a potential of losing because of the incurred attorney and court fees?

 

Mr. Leavitt:

I will answer in a couple of ways. Since I have been with the law firm of Kermitt L. Waters, close to 100 cases. We have settled most of them. The ones we have settled have been done without offers of judgment. There have been a handful of cases that have settled with this course of effect. As Assemblywoman Chowning stated earlier, Ms. Fitzsimmons, while at our office, represented her; that is one instance. Ms. Tucker, who is going to testify here today, is another instance. If you would like, I could go back through our records and pull the information for you, and probably by tomorrow or Monday, have the exact statistics. As I sit here today, I cannot tell you exactly how many cases.

 

Vice Chairman Washington:

It would be interesting to know. If you could give the information to either Mr. Anthony or Mr. Wilkinson, that would be fine.

 

Mr. Leavitt:

Absolutely, I will certainly do that. In response to the question, when that does happen, I have personally observed how landowners respond. They look at me and ask, “How can the government do this? How can they apply these rules to me?” The only answer I have is it is inequitable and it is unconstitutional. Assembly Bill 397 corrects the unconstitutionality and inequity of current offer‑of-judgment rules as they apply to landowners. I would like to tell you all the arguments I am giving you today are mine and are unique, but they are not. They are arguments that have been raised and accepted in other states, from Colorado to Alaska to California. They have accepted these arguments and held these offers of judgment should not apply to landowners in eminent domain proceedings for the exact reasons I gave you here today.

 

Senator Care:

The record of eminent domain in this State is not anything of which to be proud, and oftentimes it is even a matter of due process, not even a good faith offer of judgment. Regarding the Fremont Street experience, we had a few cases in Las Vegas in the shadow of the Stratosphere Tower. An offer of judgment is supposed to be made in good faith, and I would like to know the experience you have had with the discrepancy between the offer made and the market value of that land when the offer was made. What I am hearing is there is an intention to lowball, which is an affront to the rule in statute that governs offers of judgment.

 

Mr. Leavitt:

Through the experiences I have had, and Ms. Fitzsimmons can also address this, in the majority of cases, the government starts out low. That is my opinion, and I am saying that cautiously. When the government constructed the beltway through the Las Vegas Valley, they took approximately 1000 properties. In my opinion, nearly every one of the first appraisal reports completed was extremely low. They were based upon low values in the area. In my opinion, they did not represent fair market value. The offers of judgment typically made in this case are raised a little above those appraisal reports. The thinking behind those offers is, “We will go to court, and if the jury comes back on our low number, then we will impose the attorneys’ fees and litigation costs on the opposing party.” Many times they will apply an offer of judgment, which splits the difference between the government’s appraisal report and the landowner’s appraisal report. As I said, there have just been a handful of cases where this has occurred. In my opinion, as Assemblywoman Chowning stated today, if one person loses his or her constitutional right to payment of just compensation, that is one too many.

 

Senator Care:

Let me get into the coercion aspects. When we say the government, we mean states, counties, and municipalities. In your experience, does the offer of judgment come first? There is an offer made, then they go into negotiations, so you would expect that to be a little lower, I imagine, than the offerer knows the property is worth. The offer of judgment follows at some point afterwards. Usually, how long afterwards is the offer of judgment?

 

Mr. Leavitt:

It depends. Typically, we have cases where the offer of judgment was made 1 year afterward; we have had cases when the offer was made 10 days before trial, because there is a 10-day limitation in which to accept the offer of judgment. It depends upon the case and the attorney.

 

Senator Care:

At that point, let us take residential properties for example, do most property owners have an attorney?

 

Mr. Leavitt:

I would say the landowner typically has an attorney at the point where the offer of judgment is made.

 

Senator McGinness:

Help me go through this process. I have a piece of property that a unit of government wants. Do they send you a notice that says, for example, “Your property is in the way of a proposed freeway project and we offer you $100,000?” How many days do you have to respond?

 

Mr. Leavitt:

Typically, what the government will do is hire a right-of-way agent, usually a professional negotiator. The agent approaches the landowner and presents the appraisal report, which was initially prepared by the government’s appraiser. The agent will ask the landowner to accept it, and will then present the landowner an offer and acceptance. If the landowner accepts the offer and acceptance, the case is over. If the landowner does not accept the offer and acceptance, a complaint in eminent domain is filed, and a motion for immediate possession is filed.

 

Senator McGinness:

What time frame are you talking about?

 

Mr. Leavitt:

Typically, negotiations last 4 to 6 months. We have seen cases where they have lasted 1 year and longer. A lot of times it is difficult to answer the question because it depends upon the size of the project. On a project such as the Las Vegas Beltway, the negotiations would last longer. On a project such as a small drainage channel, negotiations would be shorter, because there are only a few landowners with which to deal. After that negotiation occurs, the government files a complaint and condemns the property. At that point in time, the landowner is forced to get an attorney, litigate the case, hire his or her own appraiser, and proceed accordingly.

 

Senator McGinness:

I decide not to accept the offer. I hire you as an attorney, and a date is set for, is it a trial or a hearing?

 

Mr. Leavitt:

What would occur is we would go through the normal discovery proceedings. A bill adopted in 1999, allows landowners to have a preferential trial setting. Typically, between 1 and 2 years, the case is set for trial. In the meantime, in that 1- or 2-year period, discovery proceeds and experts are hired. If the parties cannot agree upon a settlement, the case will proceed to trial. It could take 1 to 2 years before the landowner gets a resolution of the case.

 

Senator McGinness:

For example, it is 10 days before the trial is expected to open. You are my representative at this point, and you get an offer of $125,000.

 

Mr. Leavitt:

Typically, yes, it will either be 10 days prior to trial, or it will be 1 year prior to trial, depending upon which attorney is handling the case and what type of offer of judgment they would make. Yes, that is correct.

 

Senator McGinness:

We decide not to accept the offer.

 

Mr. Leavitt:

We would then proceed to trial.

 

Senator McGinness:

Give me a scenario.

 

Mr. Leavitt:

There are two different scenarios. We could get more than the $125,000 offer. Under those circumstances, we would not be subject to attorneys’ fees and costs. If we got less than $125,000, we would be subject to attorneys’ fees and litigation costs at that point in time. The attorneys’ fees and litigation costs would only be incurred after the date the offer of judgment was rejected.

 

Senator McGinness:

If we get more, does the State have to pay your fees?

 

Mr. Leavitt:

No, not if we get more than the State’s offer of judgment. There is another statute, NRS 18.005, which allows the prevailing party to recover costs. That is not at issue in this case. The only issue we are addressing today is the offers of judgment as they apply to landowners. Under that scenario, I would go out into the hallway with our client, and I would tell him or her what could occur. “You could get less than $125,000, and the attorneys’ fees and litigation costs could be upwards of $50,000 to $100,000, and you could have to pay those.” A landowner who has a 9-to-5 job, and does not have a lot of money, is going to fold. He is going to say, “I cannot face economic devastation. I will take it,” even if his appraisal report says he is entitled to $300,000.

 

Vice Chairman Washington:

Within that scenario, if Senator McGinness came to you, based on the offer of judgment, how are your fees paid? Do you take the assignment based on a contingency or is it up front? How would the client pay you?

 

Mr. Leavitt:

We do all of our work on a contingency fee basis, and I believe Ms. Fitzsimmons does also. The client would owe us nothing.

 

Vice Chairman Washington:

What happens if the settlement is less?

 

Mr. Leavitt:

If we achieved a settlement, it would depend upon how our attorneys’ fees were structured. Typically, we take the case for a percentage above what the government offers. The landowner can get the money without us. If we confer a benefit upon the landowner, we take a percentage.

 

Vice Chairman Washington:

Whether it goes to trial or not?

 

Mr. Leavitt:

Yes, whether it goes to trial or not.

 

Laura Fitzsimmons, Attorney:

I want to briefly explain one of the main problems of offers of judgment in condemnation cases. Offers of judgment apply in all civil cases, and under current law, as well, in condemnation cases. You heard Mr. Leavitt tell you there were questions about when the offer of judgment is filed. Mr. Leavitt responded correctly, saying it depends upon the lawyer who is representing the government. It can be early after the case is filed in court, or it can be at the last minute on the eve of trial. The timing of the filing of an offer of judgment is totally controlled by the party making the offer. The problem with this is you have 10 days to accept or reject the offer. If an offer is made early in the proceedings, and it is rejected simply because the landowner does not have enough information at that point to make a decision, the landowner is going to be responsible for the fees and costs incurred from the time of the rejection through long pre-trial proceedings. This matters a lot because, as you heard from Assemblywoman Chowning, that was certainly one of the low points in my career.

 

Individuals cannot afford to risk fees and costs, the total amount of which is unknown to them. We currently see a pattern of government agencies hiring outside law firms. In a recent case in which I tried against Clark County, they hired Jones Vargas. I just received Jones Vargas’ bill, which fortunately does not have to be paid, since we won the case. Their bill is $700,000. Their costs were many hundreds of thousands of dollars higher than those of a government agency. The disparity of resources between individuals who are going to have their property taken, and government entities and utilities, is absolutely unheard of in other civil cases.

 

Former Assemblywoman Segerblom and I worked on an eminent domain bill two sessions ago. This was a provision in that bill. There was a point and time during a hearing on the bill where I was in a room, and there were over 40 lobbyists from governmental agencies and utilities against me. The reason was the group of people this bill will protect, such as landowners, property owners, and people who have invested in Nevada, is not an organized group. We do not have a trial lawyers association or construction defects bars. We have people who do not know when that bull’s eye is going to turn to them, and they are going to have land the government needs to take.

 

I believe, as you noticed in your materials, there is a groundswell of support for this bill. If you look at the editorial in the Las Vegas Review-Journal, and at what is really going on here, we are coming to you and asking for fairness. We have heard some personal experiences this morning. I want to tell you about one case I have right now. It is a case many of you may have read about, the Lompa Ranch in Carson City. An 87-year old woman has a ranch in the center of town. She has a little place where she bottle-feeds lambs outside her door. Carson City has built up around her. For over 60 years, she and her family have lived on the property. For 20 years, the Nevada Department of Transportation (NDOT) has been saying they are going to put a bypass through the property. For 20 years she has been waiting, every morning waking up on that ranch, wondering when this is going to happen.

 

The NDOT, which has a full legal staff of its own, paid for with taxpayer money, hired a major law firm in California to represent the State in this case. The NDOT delayed filing this complaint until they had all their “ducks in a row.” Since the complaint has been filed, I have not gotten a single document in discovery, although I requested them 6 months ago. The State of Nevada is going to come to Mrs. Lompa with a new appraisal, and they will have all their “ducks lined up,” because they control everything. They control the timing and the information. They have the resources to get whatever information they want, and she will have 10 days to decide whether to accept or reject the offer. There are so many instances of unfairness.

 

When you hear the lobbyists testify in this hearing, whereas they did not come before the Assembly, keep in mind very few of the people you will hear testifying actually try these cases. You are going to hear paid employees from public entities and lobbyists for utilities. Mr. Chapman is going to tell you he represents landowners as well as government agencies. If you ask, he will also tell you he has never tried a case for a landowner. It is difficult to look into a landowner’s eyes, when he or she has invested in property, or his or her home is at stake, or he or she owns a carwash that is being taken by U.S. Highway 95, and say, “You know this is not fair, I know this is not fair, but I am obligated to tell you it is your risk if you turn this offer down.”

 

There is a concept of other people’s money, and the disparity of parties in this case is so different than in other civil cases, because there are no ramifications for the government if they turn down an offer of judgment. Nobody gets fired, nobody loses a home, nobody declares bankruptcy; it is water off a duck’s back to pay the landowner’s costs and fees. It is so different for individuals, on whose behalf we are here.

 

Vice Chairman Washington:

Assemblyman Horne indicated Senator Care offered an amendment. I am not sure if you have had a chance to review the amendment or talk to him about it. What cause would the amendment have in the case with which you are now dealing?

 

Ms. Fitzsimmons:

I did talk to Senator Care about his suggested amendment. I believe the amendment is a good idea. He was talking about the concept of good faith in rejecting an offer. In the case I have now, I believe an offer of judgment must not be made in a condemnation case until the landowner has had ample opportunity to obtain an appraisal. We are quite a ways from that for Mrs. Lompa. Once the landowner has obtained a certified appraisal with a different value, I do not believe anyone can view the landowner’s determination to assert his or her constitutional rights, as bad faith. Does that answer your question?

 

Senator Care:

The rationale, Mr. Vice Chairman, is an offer of judgment in a tort context, with a jury, is a gamble. There is an incentive for all parties to want to settle because it is a real wild card. To a degree, that applies in contract actions. When you get into eminent domain, there is no disputing this is the property and this is what we are talking about. It would seem to me if you were going to refuse an offer of judgment for real property, it would be a good faith basis to refuse it if you had an appraisal. We know 1 year, 2 years, or 5 years from now, this will be the subject of the litigation. We just have a concept here, which I have discussed with Assemblyman Horne, the punitive measures that might kick in for refusal of offers of judgment would not apply if the refusal were made based upon the good faith alliance of an appraisal.

 

Ms. Fitzsimmons:

Mr. Vice Chairman, I agree. I believe your question was about my case, where all the ducks were in a row on the other side. If, for instance, NDOT was to make an offer to Mrs. Lompa today, she does not have an appraisal for the reasons I have told you. I think when we are talking about this working concept, there has to be a provision in the bill giving the landowner an adequate opportunity to obtain an appraisal.

 

Vice Chairman Washington:

In your testimony you mentioned utilities. I take it utilities operate under a different scenario because most utilities are either above ground or buried, so we are talking about a right-of-way that is so many feet or yards wide, and underground. In that case, we are dealing with the right-of-way, or those issues concerning the buried utilities, as opposed to the entire land parcel. How would that work?

 

Ms. Fitzsimmons:

You are correct. Utilities normally take easements, something above or below the ground. The law does not differentiate between a right-of-way taking, an easement taking, and various other kinds of takings. The reason I mentioned utilities is because I know a number of their lobbyists are appearing in opposition to A.B. 397. Utilities tend not to litigate to the same extent. If someone is taking an easement, chances are much less likely there will be litigation, because they are not doing, for example, what happened to Assemblywoman Chowning. The law does apply equally to those takings.

 

Donna Aimee Tucker:

I live in Las Vegas. I owned property, which was taken by the government, on the corner of Simmons Street and Red Coach Avenue in North Las Vegas. The government took part of my property and paid me only $12,600. I believed their offer was undervalued, so I proceeded to trial and pursued my rights to just compensation. Just prior to trial the government tendered an offer of judgment to me for only $34,000. My Member of the Appraisal Institute (MAI) appraiser determined the value of the taking was much greater, over $200,000. However, the government took my property, and if I had not accepted the offer and gotten less at trial, I would have had to pay the government’s attorneys’ fees and costs and outside counseling, in an amount greater than $50,000. My family and I live on a fixed income. I could not afford to take the risk and become a debtor of over $50,000. Therefore, I chose to settle out of court for an amount I believe was less than just compensation.

 

Vice Chairman Washington:

How much were you looking for?

 

Ms. Tucker:

My appraiser appraised it at over $200,000.

 

Vice Chairman Washington:

You said the government took your property, so I assume that was the City of North Las Vegas?

 

Ms. Tucker:

That is correct.

 

Vice Chairman Washington:

Can you describe your parcel?

 

Ms. Tucker:

I had a corner acre on Simmons and Red Coach Avenue. They made it a drainage ditch, and came back and took another corner to go down Craig Road with a drainage ditch to outfall for the channel.

 

Vice Chairman Washington:

Did you have any specific purposes for the land?

 

Ms. Tucker:

It was master-planned commercial, and I was waiting for the development in that area before doing anything.

 

Vice Chairman Washington:

So, you lost an egress?

 

Ms. Tucker:

Yes.

Vice Chairman Washington:

Was your appraisal certified?

 

Ms. Tucker:

It was by an MAI appraiser from my attorney’s office.

 

Vice Chairman Washington:

Before you leave, Mr. Walch sent a letter to the committee stating he would like an opportunity to testify on behalf of the City of North Las Vegas regarding the case. We will allow Mr. Walch to testify, and if you have any comments afterward in rebuttal, we will allow that also.

 

Gregory J. Walch, Attorney:

My firm and I, in particular, represent parties in condemnation actions, both private litigants and public entities. I will say I have taken cases to trial on behalf of both. I am here today at the request of the City of North Las Vegas to do two things; one is to clarify what has been made part of the record relative to the City of North Las Vegas v. Donna Aimee Tucker case. That case has been offered as justification for throwing out what we consider a valuable tool of compromise, the offer of judgment rule. Second, I am here to outline some policy concerns I have regarding A.B. 397. I have forwarded a letter to the committee, which I respectfully request be made a part of the record (Exhibit E). There was a lot of newspaper coverage of Ms. Tucker’s case, again, as justification for A.B. 397. I just want to highlight a few of the issues in the case, and I will be brief as to why I believe the case demonstrates why offers of judgment are a valuable tool.

 

If Ms. Tucker, in my opinion, was compelled to settle this matter because she might have to reimburse the City of North Las Vegas for attorneys’ fees or costs, I believe she has the existing rules of Nevada Rules of Civil Procedure 68 and NRS 17.115 to thank for saving her quite a bit of time and money. By way of background information, what this case was about was taking less than one‑tenth of an acre, about 3500 square feet, of her property. The dispute, as she has noted, was between the parties as to the value of the take area. The City’s estimate was $12,600, and her appraiser’s estimate was that value plus the value of a separate easement, for a total of $41,438.

 

The $220,000 number she mentioned deals with a separate issue, and I believe that is the source of her frustration. The separate issue regarded a channel north of her property that had been there for approximately 14 years. In 1984, Ms. Tucker’s predecessor in interest in the property conveyed the channel, by virtue of a dedication to the city, in exchange for the ability to subdivide his lots. In 1991, the same dedicator attended the meeting at which the City of North Las Vegas described its plans to improve the drainage ditch, and he indicated he had no objection to how the ditch would be developed. We are not talking about a corner lot as of 1984, and certainly not by 1991. The city constructed the channel in 1991 and 1992. Ms. Tucker did not obtain title to her property until 1993, approximately 2 years after the channel was constructed, which clearly implied she had notice of the improvement. There were two fatal flaws to the concept in Ms. Tucker’s MAI-approved appraisal stating she would be entitled to inverse condemnation damages for the channel improvement, consisting of about one acre.

 

First, there was a statute of limitations problem that was a hurdle she could not surmount. There was also the fact she did not own the property. It had been conveyed to the city in 1984, nearly 20 years ago. Looking at those two things, the parties nevertheless persisted and made it to the courtroom door before settling the matter. The city formulated an offer of judgment in the case, taking into account what we believe was the exceedingly low risk she could recover on the $220,000 claim. Ms. Tucker herself, which you have not heard about, formulated an offer of judgment in the case. She, in fact, compromised what she believed to be the fair value by about $125,000 and offered us $125,000 for resolving the action. Importantly, neither party accepted the offer of judgment. Most interesting for this committee’s resolution of this matter, ultimately, if you took both offers of judgment, added them together and divided by two, you would end up with the figure of $73,500. As it turned out, the parties settled almost right on that number, for $70,000.

 

In the settlement papers, Ms. Tucker acknowledged she had not owned the property since 1984. I believe, had the parties proceeded to trial in this matter, all sides would have incurred significant additional cost to go through the weeklong trial. The likelihood of a verdict greater than $70,000 was almost nonexistent, and we would have wasted and exhausted judicial resources. Accordingly, the forced review of the merits of the case, the facts, and legal conclusions, narrowed the focus of both parties to the point where we could settle the matter. We settled at a number significantly above what we thought would be approved at trial, and she came down.

 

I would like to address a couple of thoughts with respect to what Mr. Leavitt said, which is what the court looks at when actually determining whether to grant attorneys’ fees. This has not yet been articulated to this committee. Even though, in Ms. Tucker’s matter, our offer was $22,600, let us say she had only received $20,000 as a judgment. To award our attorneys’ fees in the case, the court does not just look at the $22,000 and the $20,000, and decide the landowner did worse, and therefore she should pay the city’s attorneys’ fees. Her refusal to accept the offer, by Nevada Supreme Court precedent, has to be grossly unreasonable or in bad faith. The protection is there. I have heard a thought here that maybe by amendment to this bill, an MAI appraisal might be a safe harbor. In other words, if an owner has an MAI appraisal, they would not be paying attorneys’ fees and costs to the other side, or to the condemning authority for refusing to accept a number that was below their MAI appraisal number. My concern is we have seen absolutely preposterous theories advanced, even in MAI appraisals. A note for the record, in fact, the appraiser Ms. Tucker hired, and the person who calculated the $220,000 damages, has now lost his license, not as a result of this particular appraisal, but for other reasons. The fact a MAI appraiser might have made a statement in an appraisal does not, necessarily, mean it is a reasonable number.

 

I believe Mr. Hutchins is going to comment about a memo his office had drafted that argues some policy points. However, stepping away from my hat as a North Las Vegas attorney, for a second, I will argue three quick policy points why I believe A.B. 397 should not pass out of this committee. Let us talk about disparity and power. The landowner more easily uses an offer of judgment tool or device in condemnation actions. The reason for that is quite simple. In fact, I believe in every case I have ever had on behalf of a landowner, I did present an offer of judgment to the condemning authority. On the other hand, having represented condemning authorities, as well, it is much more difficult to, first, get authority to issue an offer of judgment at a number that is higher than the appraised value, because you have to tell the board, “We believe it is only worth $50,000, but we have to offer $75,000.” Second, it is difficult in a public forum to disclose your theories of the case. There is a debate about whether it has to be made in a public forum, and the exercise of caution would dictate it be done in a public forum. The problem is you do not often see offers of judgment coming from condemning authorities that are enforceable.

 

I would like to make one last point on Assemblyman Horne’s first comment. One of the arguments advanced by the opponents is this does not happen very often. In my practice, I have been informed of one instance where attorneys’ fees were granted to a condemning authority, and that was anecdotal. I have never actually seen the case. The reason is because the standard is so high. The rejection has to be grossly unreasonable or in bad faith. I have, again, litigated these cases side-by-side with Mr. Leavitt, and I have litigated them on the other side of the table from Mr. Leavitt. Taking my North Las Vegas hat off again, I believe this is probably a good bill for attorneys. More cases will get to trial, there are more chances to advance what I will call flyers, with impunity, and there are ultimately more fees, contingent or otherwise, paid to attorneys. Unfortunately, while it might be helpful to me personally, I do not believe A.B. 397 actually helps the people it is designed to protect. Therefore, I would respectfully request the bill not pass out of committee.

 

Mr. Leavitt:

I would like to respond to a couple of points raised by Mr. Walch, and Ms. Fitzsimmons would then like to respond. One of the arguments Mr. Walch made was there were fatal flaws to Ms. Tucker’s case. The two fatal flaws were a statute of limitations problem, and the fact Ms. Tucker did not own the property at the time it was taken. Those arguments were presented to a district court judge, who rejected them and allowed the case to proceed to trial. The judge held they were not fatal flaws. The second point was Ms. Tucker, herself, made an offer of judgment. Her offer of judgment was made only after the government made their offer of judgment. That rule did not help her in this case.

 

Mr. Walch stated, in the settlement papers, Ms. Tucker recognized she did not own this property, which was taken for the drainage channel, referred to earlier. Of course that would be put into the settlement papers; the government was purchasing the property. For the government to say Ms. Tucker recognized she never owned it is baseless. Mr. Walch said the settlement was good because Ms. Tucker got $70,000. She had an appraisal report for $220,000 and was forced to settle for $70,000. I personally sat in the hallway with her during that time and saw her struggle with what to do. She knew she was entitled to more. She knew she was entitled to just compensation, but she did not go for it, because she could not subject herself to liability. She has worked for 15 years at Smith’s Food King. She cannot face economic devastation because of the case.

 

Vice Chairman Washington:

Mr. Leavitt, between you and Mr. Walch, we are not a court of law. You can get into the particulars and technicalities of the law and what transpired in court with him. Our position is to determine the merits of A.B. 397. I want to know, and I am sure the committee wants to know, how this bill would aid and assist Ms. Tucker, if implemented into statute.

 

Mr. Leavitt:

In other words, if this bill had existed at the time, would Ms. Tucker’s case have proceeded? She would have been out in the hallway, and when they made the offer of judgment, if indeed Senator Care’s amendment was added to the bill, I would have said, “We have an appraisal report, which is valid and enforceable, according to the bill, and therefore, we can proceed without the risk of you having to pay attorneys’ fees and litigation costs of the government.” We could have proceeded to trial, like we wanted to do, and had the jury, eight independent members of the community, decide the amount of just compensation.

 

Vice Chairman Washington:

Mr. Walch commented, at the end of his testimony, he believes this would be a bill for attorneys.

 

Mr. Leavitt:

I do not believe that to be true. Mr. Walch, himself, stated very few of these cases settle because of offers of judgment. We sit down and work these cases out. Our goal is to settle these cases; it is not to try to stick it to the government. It is to try to receive a fair judgment for the landowners. If we settle the case, as we said before, typically our fee agreement is based upon the amount the government offers and a percentage of any amount above the asking amount. It is not a bill for the attorneys. By the way, the appraiser in Ms. Tucker’s case did not lose his license.

 

Ms. Fitzsimmons:

I believe a couple of points need to be made in light of the statements you have heard from an agent for the condemners and others you will hear. I have gone through the legislative history of the eminent domain bills passed by this Legislature for the past 20 years. Normally, this phalanx of agencies, who spend a great deal of time and effort on various endeavors, comes in and proposes bills and they pass. In past legislative history, when it suited their purposes, the condemners stated whatever their takings are, let us say they are building a roadway, a very small percentage, I believe less than 5 percent of the people, do not just take their offer in the first place. The 5 percent, let us say that is the working number, say, “No, we want to go to court.” Of the 5 percent that goes to court, almost all of the cases settle.

 

A very small number of condemnation cases go to trial. Nobody is clogging the court system. You do not see judges in here, you do not see anyone in here except condemners talking about the reasons they do not want this bill. A tiny percentage of cases pending in any district in this State are condemnation cases. The reason these cases are going to trial is because there are substantial differences of opinion based upon the kinds of things we have heard. Those things need to be fleshed out so people are fairly heard.

 

I want to say one more thing since it was brought up. I was not involved with Ms. Tucker’s case, and I do not know to which appraiser Mr. Walch referred. I will tell you one thing, the people coming before you today have immense power. The NDOT is currently prosecuting an appraiser because he testified on a case for a landowner. The jury believed him, the judge believed him; they came in at the appraiser’s number, and NDOT, who lost the case, is prosecuting the appraiser through the same attorney general’s office.

 

We are having an attack on every front. People who are not here and do not have voices before you, other than our voices, are asking you for protection, because you have no idea how different these cases are. They are constitutional, and have the awesome power and resources of government against individuals.

 

Senator Care:

Ms. Fitzsimmons, what is the name of the appraiser?

 

Ms. Fitzsimmons:

His name is Jim Hines, and he testified here in a case involving the taking of property. The Lompas had intended to hire him, and NDOT, after realizing they could not hire him to represent them, filed a complaint with another State agency against him to take his license. They are trying to take these appraisers out. I have a former employee in the NDOT office who will say it is a policy. They have vehicles and powers that individuals do not have. We are fighting in the trenches. This is a tiny bill. I will provide to you a brief, which shows every state and every court that has considered this issue, has determined the Constitution requires landowners be allowed one shot in front of one forum to get an independent determination of the compensation due to them. They cannot be coerced by the threat of paying attorneys’ fees and costs in their one shot.

 

Mr. Walch:

I would like to make two quick clarifications for the record. One is, it is still our understanding the appraiser’s license in the Tucker matter was suspended. Two, Judge Parraguirre, in our case, did not reject our claims, and instead, simply denied the motion for summary judgment and let those claims proceed to trial.

 

John Sande III, Lobbyist, Airport Authority of Washoe County:

I am with the law firm of Jones Vargas, and here today on behalf of the Airport Authority of Washoe County. Michael Alonso is here to testify, and I believe he is more familiar with this matter, and will therefore lead the testimony.

 

Michael Alonso, Airport Authority of Washoe County:

With me is Mike Chapman, who also represents the Airport Authority of Washoe County, in addition to some other parties. I believe Mr. Walch did a good job of putting forth our points, but I want to reiterate something I believe is important regarding Senator Care’s proposed amendment. As I understand it, and I am not an expert on eminent domain, but in the Nevada Supreme Court cases on whether or not a trial court can grant attorneys’ fees based on offer of judgment and the factors that must be considered, I believe is where you are going, either bad faith or whether the offer was reasonable. I am going to reiterate them because I believe they are important. There are four parts to the test: whether the plaintiff’s claim was brought in good faith; whether the offer of judgment was brought in good faith; whether the offeree’s decision to reject the offer and proceed to trial was grossly unreasonable or in bad faith; and whether fees sought by the offeror were a reasonable and justified amount.

 

I believe if the offeree on either side is relying upon an appraisal, and the judgment comes in lower than the offer of judgment, it is one of the issues that will go before the trial court and potentially, on appeal, to the Nevada Supreme Court, whether the offeree’s decision to reject the offer and proceed to trial is grossly unreasonable or in bad faith. Clearly, if they have an appraisal that is done correctly and close to the offer of judgment, I do not believe the district court, under these standards, would call that unreasonable in rejecting the offer. I believe this is what we are talking about. Maybe, in listening to the testimony, the amendment should be to put those four things into statute, to codify what the Nevada Supreme Court has done. I believe those protections are important and they are there.

 

The proponents talked about people unwillingly being brought into court, and how that is somehow an important factor. In every case I know of, the defendant is unwillingly brought into court. It does not matter what type of case it is; you are unwillingly brought into court. Offers of judgment are allowed in all civil cases. I agree with Mr. Walch on this. I am a member of Jones Vargas and so is John Sande. On the airport cases Ms. Fitzsimmons was talking about, I would like to know, since she brought up our attorneys’ fees, what hers were in that case. I believe, from our standpoint, if offers of judgment were not allowed in these cases, maybe the $700,000 would be a lot higher. There is no motivation to settle, and I believe these cases are going to go to trial, and attorneys’ fees and costs are going to continue to go up.

 

Mike Chapman, Attorney:

I have been practicing eminent domain law for approximately 19 years, 10 of which were with the attorney general working with NDOT. For the last 9 years, I have had an office in Reno and have practiced mainly in Reno and Las Vegas, representing not only condemning agencies, but also property owners. Ms. Fitzsimmons asked me if I had ever actually taken a case on behalf of a landowner to a jury trial. The answer is no, because I was successful in settling every one of the cases, in which I have represented a landowner, by using the offer of judgment process on behalf of the landowner. That would include the largest settlement, as far as I am aware, ever negotiated on behalf of a landowner in Nevada, in which we received $17 million from the State. In my opinion, the offer of judgment process is a valuable tool for landowners and for condemning agencies.

 

I believe Senator Care mentioned the process for settlement is to reach a reasonable number, and would not the offer of judgment process, if it were done properly, encourage both sides to be reasonable and perhaps even exceed the value of its appraisal? I would like to show a chart. What I am holding up is an aerial photograph of Las Vegas; north is at the top. What you can see in the photograph is the southern beltway, the Interstate 215 beltway at the corner of Valley Verde Drive. Outlined in red is the Monument Point subdivision, which is approximately 14 acres in size. This is a case we tried last year in Las Vegas, which is now on appeal to the Nevada Supreme Court. Mr. Waters, Mr. Leavitt, and others, represented the property owner. I represented Clark County Public Works in the case.

 

The taking is what the landowner’s appraiser refers to as a sliver at the very corner where the on-ramp toward Henderson is located, 549 square feet out of 14 acres. It’s less than one ten-thousandth of the entire land area of the ownership was acquired for this turning movement, mainly for sight distance. No house was taken. The backyard was made a little smaller. In the after condition, the property was still the largest in the subdivision.

 

All of the appraisers, on both sides, agreed the value of the land was less than $9,000. The landowners, however, had a claim we believed to be spurious, but nevertheless it got to court as evidence. Their appraisals were in the vicinity of $1.7 million for damages to the remainder of the subdivision, which we thought was not going to work. However, based upon my advice and the judgment of county officials, we made a stand, by way of an offer of judgment, 10 months before trial, to alleviate the county’s cost to try this case. We knew trial costs would exceed $400,000. We made an offer of $407,100, 10 months before trial. Bear in mind, this was before a lot of money was spent by either side doing depositions and so forth. We were trying to save everybody fees. I think everyone would agree it was a significant gesture upward toward reaching a fair number, simply based, not upon our opinion of the land value or our agreement with their position, but the exposure to the taxpayer. Given that exposure and given the cost of defeating the landowner’s claims, it merits an effort to settle the case.

 

The offer was rejected and the case went to trial. The landowner, even though he told us in deposition his testimony would be $3.5 million, surprised everyone by testifying, “Now I need $4.6 million to make myself whole in this case,” for a 549 square foot take, which is probably about half the size of this room. The verdict came back at $104,600. We had an offer of judgment. The district judge, even in this case on these egregious facts, did not make the landowner pay the attorneys’ fees, which were substantial, for the condemning agency. Our bill, including expert witnesses and so forth, was over $600,000. It would have been cheaper for the county to take our offer, even though we thought it was more money than it should have been. The judge, who is part of the offer of judgment rule, did not allow the property owner to recover his costs from the county. They asked for over $130,000 in costs they had incurred for us to pay, even though they rejected our offer, we believe, unreasonably. There is no constitutional right for a landowner to refuse a good offer and then make the government pay their costs. That is what the offer of judgment rule prevents, and it also prevents the person from getting interest on his or her money from the time of the offer. They could have had $400,000, but they insisted on going to court, and it took 10 more months to get there. They are not going to get interest on the $100,000 difference minus the $8,600 we deposited.

 

We believe this illustrates the offer of judgment process actually helps both sides reach an answer, and costs can be allocated to where they ought to be. When someone refuses a reasonable settlement offer, what they are actually doing is not incurring a penalty, they are transferring a burden to the other side by forcing the other party to go to court and incur a lot of expense. The offer‑of‑judgment rule is to give people pause to think about the fact they may not get their costs, and perhaps have to pay costs on the other side, if they are unreasonable. In other words, it encourages people not to place a burden on the opposing party, but rather to be reasonable. I have used the offer of judgment rule very successfully on behalf of landowners.

 

When I represent condemning authorities, I like to use the offer of judgment because I think it works equally well for both sides. Testifiers in favor of A.B. 397 commented the timing of the offer of judgment is important. In other words, if the condemning agency makes its offer too early, it is an imposition on the landowner. Typically, the government is required by law to make a fair offer to begin with. That is the goal. There is always a possibility the appraisal could be wrong. A licensed appraiser, usually an MAI appraiser, appraises the property. The appraisal is reviewed by a second person. If you are at the State level, NDOT, for example, federal highways will review the appraisal, as well. I am also handling the re-track cases for the City of Reno. The city hires not only an appraiser to do the work, but also another appraiser to review the first appraiser’s work. The offer is presented to the property owner, who typically has 30 days or more to review it. If the parties cannot agree through the negotiation process, it will go to court. The offer of judgment is usually not made at that early stage. Generally, there is a period of time that goes by because the courts have rules and procedures to follow to get a case to trial.

 

I have not seen the amendment, but I believe requiring an appraisal needs to be given more thought. The landowner will always have an appraisal, eventually. It has been my experience the landowner’s appraisal makes the scene close to the trial date, or after quite a bit of time has gone by. While all of that needs to be done 45 days prior to trial, it seems in many cases, we are up toward the end where a lot of the benefit of the settlement discussion is gone by the wayside because all the work has been done. I believe the offer of judgment can be done earlier in the process for the fairness of all. That simply encourages people to prepare their cases sooner and not wait until the trial date.

 

Senator Care:

Was the initial figure $1.7 million, and the offer of judgment $407,000?

 

Mr. Chapman:

Yes, and the landowner appraisals were in the range of $1.7 million. The owner, who can testify in court, told us before trial he would testify to $3.5 million, and during trial he said $4.6 million.

 

Senator Care:

The appraisal was $1.7 million? What was the basis for saying $1.7 million unless the appraiser was coached in some way? I do not know how an appraiser could come up with $1.7 million for 549 square feet.

 

Mr. Chapman:

I can explain very briefly how they did.

 

Senator Care:

The reason I asked is because I am the one who came up with the idea of perhaps using an appraisal in the amendment. You are not talking about an appraisal for $9,000; you are talking about an appraisal for $1.7 million.

 

Mr. Chapman:

Yes, a significant difference, and we had two completely different theories of the case. Our theory was this case was filed in 1997. When you file this type of case, under the statutory scheme in Nevada, you get a date of value. The date of value was September 1997. The landowner had an alternate theory. The landowner said during a planning meeting in 1995, there was a discussion about what the interchange would be like. It is what they call a single-point urban design interchange. They can also go with a diamond interchange, which takes more land. Some of the preliminary plans, which were shown to the public at the time, indicated if they built a big interchange it could affect some of the houses in the subdivision, perhaps as many as 8 to16 units. Even when the design was final, it was just this insignificant sliver.

 

The landowner clung to the theory his property had somehow been damaged because of those public discussions. As you know, as members of an elected body, trying to do anything without the public being involved does not work well in these modern times. The public has to be involved. The property owners said because of that, the ability to sell their houses took longer and led to other types of damages, which in our judgment were not valuing the property any longer, but trying to value the business. We have counterproof there were other reasons for house sales to slow down at that time, but you can see with these cases, one leads to another, creating a ripple effect, and they become very expensive. That is the difference in the appraisals. They were based on two completely different approaches and theories.

 

John Madole, Lobbyist, Associated General Contractors, Nevada Chapter:

We just want to express our opposition to A.B. 397. Primarily, we are concerned if we were to change this, it might inflate the cost of obtaining rights-of-way for needed roads and using the funds for purchasing property instead of for building roads.

 

Stephanie Barker, Attorney, Civil Division, Clark County District Attorney’s Office:

I handle some condemnation cases for the county. In that process, we condemn property for beltways, roadways, rights-of-way, and flood control. We spend money in that process, funded by several public entities. I believe it is important for the committee to understand the government is not here to pick on private landowners. The money that gets spent for government projects, including the portion for eminent domain, is taxpayer money. We have an obligation to the taxpayers, whose money we spend, to spend it wisely. When you utilize an offer of judgment tool in a condemnation setting, you have to make a determination of a reasonable value for the property. I differ in this because I believe it is a gamble. The appraisals are vastly different in their values. They will all be done by MAI appraisals. People with a significant amount of experience may take a different approach. They will look at it, and one will say, “I am going to be conservative in my approach,” and the other may be a little more creative in his or her approach.

 

That is how you get disparate appraisals. The disparity may be a couple of hundred dollars; it may be a couple of million dollars. They are significantly far apart on an increasingly frequent basis. The difficulty comes when the landowners decide to roll the dice and go to trial to see whether they can get a jury, who cannot be advised it is taxpayer money they are spending, to come in at a high number. The government should not be required to finance that gamble. The benefit of the offer of judgment rule, as Mr. Chapman has talked about, is it cuts off that possibility. If you sit down and appropriately evaluate what is a good offer, it needs to be a highball offer and not a lowball offer. As the attorney looking at a landowner’s appraisal, I cannot make a good decision about an offer of judgment if I do not have it. I have to look at their appraisal, and the government’s appraisal, and I have to decide reasonably how a jury is going to receive the information. What is a jury of normal, everyday citizens, many of whom are landowners, just like the person represented in the eminent domain process, going to decide this is reasonably worth, based on significantly differing expert opinions? I have to figure what I believe will be their high number. Then I must do the offer of judgment slightly above that number, because if we go to trial and we do not come in under that number, we can be on the hook for the landowner’s attorneys’ fees.

 

When I say “we,” I am not just talking about big government. I am talking about taxpayer money that funds eminent domain purchases. Not only do we end up paying what the jury determines is the reasonable, just compensation for the property, but we end up paying for the landowner to go to trial to roll those dice. That is not a good decision in terms of how we spend the money. We make an offer of judgment to try to short-circuit the process and to ensure the money is spent to purchase land instead of to finance litigation. The benefit of this rule is it enables us to do that. Based upon my research in the last 10 years, there has never been a time where an offer of judgment has resulted in money being paid by a landowner to Clark County, because the county was able to come in under the offer of judgment. The reason is, the judge must make a determination the landowner’s decision to say “No,” to roll the dice and go to court, was grossly unreasonable. The judge makes that determination. If you have a landowner who comes in and says, “I had an appraisal that said it was worth more than this, and I wanted my chance to come to court and be able to get a jury to say whether or not my appraiser is right,” it is extremely unlikely, and I do not know of any case involving Clark County, for a judge to say it was unreasonable for the landowner to choose to do that. This is why the Nevada Supreme Court has built in that standard.

I would like to submit to the committee you need to be aware, this is a gamble, and the purpose of this is to cut off public funding to the rolling of the dice.

 

Senator Titus:

I appreciate all your gaming analogies. I am not sure they are appropriate. I just wonder how much of the taxpayers’ money Clark County spent hiring private lawyers like Jones Vargas to fight condemnation cases when the person does not accept your settlement offer, let us say in the last year. That must be public record.

 

Ms. Barker:

It might be, Senator. I cannot respond to that. I do not have that data in front of me. I know we have historically handled a significant portion of that in-house through the district attorney’s office.

 

Senator Titus:

Could we get that information? It would be helpful.

 

Ms. Barker:

I will be happy to request it.

 

Heidi Mireles, Chief of Right-of-Way, Department of Transportation:

I am here today on behalf of NDOT to indicate we are in opposition to A.B. 397. The comments I intended to make this morning have already been made by a number of individuals, and I do not want to take more of your time.

 

Brian Hutchins, Chief Deputy Attorney General, Transportation and Public Safety Division, Office of the Attorney General:

I am chief counsel for the Nevada Department of Transportation. I am with the Office of the Attorney General, and I will echo Ms. Mireles’ comments. I do not believe I can add to what has been stated today. I will note I distributed to the committee a position statement (Exhibit F) against A.B. 397. I take responsibility for that, and I did work in collaboration with a few of the other attorneys you have heard today to ensure we had some of the basic law as succinct and as plain as possible for your perusal.

 

Zev Kaplan, General Counsel, Regional Transportation Commission of Southern Nevada:

I would like to echo the comments made in opposition to A.B. 397 by the other representatives who have appeared today.

 

Leslie Nielsen, Chief Deputy City Attorney, City of North Las Vegas:

The City of North Las Vegas opposes A.B. 397, and I also concur in the statements made by Mr. Walch this morning, in particular, on behalf of the City of North Las Vegas and the position statement presented by Mr. Hutchins, and statements made by Mr. Chapman and Ms. Barker.

 

Assemblyman Horne:

I would like to get copies of the submitted rebuttal because they never came to me prior to today’s hearing. Secondly, I find it interesting nearly everyone in rebuttal was saying there is no harm here, it does not happen, yet they have come out in force, saying, “Please do not take our hammer away.” Why? Because they know it does exist, if only for the reason of all those people from whom you do not hear, who have put their tails between their legs and have taken what was offered and moved on. In my district, Clark County Assembly District No. 34, Interstate 95 was widened and homes were taken. These were middle class homes in the neighborhood in which I grew up. Those people were there when I was a little kid and are people who had the government before them saying, “We are going to take your home. We can do that.” I know the government can do that, and that is not what we are trying to change. They said, “We are going to take your home, and here is what we are going to offer you.” If they were wise enough to go to an attorney, the attorney had to tell them, “If you lose, this is what you are in fear of having to pay.”

 

You have heard the testimony. The government is not too shy to spend hundreds of thousands of dollars for property they do not even believe is worth it because they know they can possibly go and get it elsewhere. Now you have the average “Joe American Six-pack” at home, maybe looking forward to retirement, having to dip into retirement money to pay attorneys’ fees and court costs, all because he wants to say to a jury, “Are they right or am I right, or can you come up with a figure?” All I am asking for, and all A.B. 397 is asking for is to remove the hammer from the government’s hand over the citizens’ heads and allow them to proceed in good faith and discover the true value of their land.

 

Vice Chairman Washington:

We will close the hearing on A.B. 397. If there is any additional information you wish to submit, please give it to Mr. Anthony, Mr. Wilkinson, or the chairman of this committee before work session. We are adjourned at 11:38 a.m.

 

 

RESPECTFULLY SUBMITTED:

 

 

 

                                                           

Jo Greenslate,

Committee Secretary

 

 

APPROVED BY:

 

 

 

                                                                                         

Senator Mark E. Amodei, Chairman

 

 

DATE: