2005 Statutes of Nevada, Pages 2479-2632

[Rev. 2/8/2019 9:32:38 AM]

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ê2005 Statutes of Nevada, Page 2479 (CHAPTER 483, AB 380)ê

by the person or agency or transmitted by an agent of such a person or agency. An order for a controlled substance listed in schedule II must be made pursuant to NRS 453.251.

3. A pharmacy, institutional pharmacy or other person licensed by the Board to furnish controlled substances and dangerous drugs may sell to:

(a) The holder of a permit issued pursuant to the provisions of NRS 450B.200 or 450B.210;

(b) The holder of a permit issued by another state which is substantially similar to a permit issued pursuant to the provisions of NRS 450B.200 or 450B.210; and

(c) An agency of the Federal Government that provides emergency care or transportation and is registered with the Drug Enforcement Administration pursuant to 21 C.F.R. Part 1301.

4. A pharmacy, institutional pharmacy or other person licensed by the Board to furnish dangerous drugs who sells supplies pursuant to this section shall maintain a record of each sale which must contain:

(a) The date of sale;

(b) The name, address and signature of the purchaser or the person receiving the delivery;

(d) The name and address of the authorizing practitioner; and

(e) The name, strength and quantity of each drug sold.

5. A pharmacy, institutional pharmacy or other person licensed by the Board to furnish dangerous drugs who supplies the initial stock for an ambulance or other emergency vehicle shall comply with any applicable regulations adopted by the State Board of Health, or a [county or] district board of health, pursuant to NRS 450B.120.

6. The Board shall adopt regulations regarding the records a pharmacist shall keep of any purchase made pursuant to this section.

Sec. 34. 1. This section and sections 1 to 24, inclusive, and 26 to 33, inclusive, of this act become effective on July 1, 2005.

2. Section 24 of this act expires by limitation on the date of the repeal of the federal law requiring each state to establish procedures for withholding, suspending or restricting the use of professional, occupational and recreational licenses for child support arrearages and for noncompliance with certain processes relating to paternity or child support proceedings.

3. Section 25 of this act becomes effective on the date of the repeal of the federal law requiring each state to establish procedures for withholding, suspending or restricting the use of professional, occupational and recreational licenses for child support arrearages and for noncompliance with certain processes relating to paternity or child support proceedings.

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CHAPTER 484, AB 554

Assembly Bill No. 554–Committee on Commerce and Labor

CHAPTER 484

AN ACT relating to taxation; clarifying the definition of “employer” for the purpose of the tax on business; revising the provisions governing the applicability and administration of the tax on live entertainment; clarifying the provisions governing the administration of the use taxes on certain personal property acquired free of charge at public events; expanding the exemptions from the taxes on the transfer of real property; revising the provisions governing the application of sales and use taxes to retail sales of vehicles for which used vehicles are taken in trade; revising the provisions governing the application of sales and use taxes to retail sales of farm machinery and equipment; providing for the submission to the voters of the question whether the Sales and Use Tax Act of 1955 should be amended to provide an exemption from the tax for sales of vehicles for which used vehicles are taken in trade and for farm machinery and equipment; providing exemptions from certain analogous taxes; and providing other matters properly relating thereto.

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events; expanding the exemptions from the taxes on the transfer of real property; revising the provisions governing the application of sales and use taxes to retail sales of vehicles for which used vehicles are taken in trade; revising the provisions governing the application of sales and use taxes to retail sales of farm machinery and equipment; providing for the submission to the voters of the question whether the Sales and Use Tax Act of 1955 should be amended to provide an exemption from the tax for sales of vehicles for which used vehicles are taken in trade and for farm machinery and equipment; providing exemptions from certain analogous taxes; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 363B.030 is hereby amended to read as follows:

363B.030 “Employer” means any employer who is required to pay a contribution pursuant to NRS 612.535 for any calendar quarter, except a financial institution, an Indian tribe, a nonprofit organization , [or] a political subdivision [.] or any person who does not supply a product or service, but who only consumes a service. For the purposes of this section:

1. “Financial institution” has the meaning ascribed to it in NRS 363A.050.

2. “Indian tribe” includes any entity described in subsection 10 of NRS 612.055.

3. “Nonprofit organization” means a nonprofit religious, charitable, fraternal or other organization that qualifies as a tax-exempt organization pursuant to 26 U.S.C. § 501(c).

4. “Political subdivision” means any entity described in subsection 9 of NRS 612.055.

Sec. 2. Chapter 368A of NRS is hereby amended by adding thereto the provisions set forth as sections 3, 4 and 5 of this act.

Sec. 3. “Casual assemblage” includes, without limitation:

1. Participants in conventions, business meetings or tournaments governed by chapter 463 of NRS, and their guests; or

2. Persons celebrating a friend’s or family member’s wedding, birthday, anniversary, graduation, religious ceremony or similar occasion that is generally recognized as customary for celebration.

Sec. 4. “Shopping mall” includes any area or premises where multiple vendors assemble for the primary purpose of selling goods or services, regardless of whether consideration is collected for the right or privilege of entering that area or those premises.

Sec. 5. “Trade show” means an event of limited duration primarily attended by members of a particular trade or industry for the purpose of exhibiting their merchandise or services or discussing matters of interest to members of that trade or industry.

Sec. 6. NRS 368A.010 is hereby amended to read as follows:

368A.010 As used in this chapter, unless the context otherwise requires, the words and terms defined in NRS 368A.020 to 368A.110, inclusive, and sections 3, 4 and 5 of this act have the meanings ascribed to them in those sections.

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inclusive, and sections 3, 4 and 5 of this act have the meanings ascribed to them in those sections.

Sec. 7. NRS 368A.020 is hereby amended to read as follows:

368A.020 “Admission charge” means the total amount, expressed in terms of money, of consideration paid for the right or privilege to have access to a facility where live entertainment is provided. The term includes, without limitation, an entertainment fee, a cover charge, a table reservation fee, or a required minimum purchase of food, refreshments or merchandise.

Sec. 8. NRS 368A.060 is hereby amended to read as follows:

368A.060 1. “Facility” means:

[1.] (a) Any area or premises where live entertainment is provided and for which consideration is collected for the right or privilege of entering that area or those premises if the live entertainment is provided at:

[(a)] (1) An establishment that is not a licensed gaming establishment; or

[(b)] (2) A licensed gaming establishment that is licensed for less than 51 slot machines, less than six games, or any combination of slot machines and games within those respective limits.

[2.] (b) Any area or premises where live entertainment is provided if the live entertainment is provided at any other licensed gaming establishment.

2. “Facility” encompasses, if live entertainment is provided at a licensed gaming establishment that is licensed for:

(a) Less than 51 slot machines, less than 6 games, or any combination of slot machines and games within those respective limits, any area or premises where the live entertainment is provided and for which consideration is collected, from one or more patrons, for the right or privilege of entering that area or those premises, even if additional consideration is collected for the right or privilege of entering a smaller venue within that area or those premises; or

(b) At least 51 slot machines or at least 6 games, any designated area on the premises of the licensed gaming establishment within which the live entertainment is provided.

Sec. 9. NRS 368A.090 is hereby amended to read as follows:

368A.090 1. “Live entertainment” means any activity provided for pleasure, enjoyment, recreation, relaxation, diversion or other similar purpose by a person or persons who are physically present when providing that activity to a patron or group of patrons who are physically present.

2. The term:

(a) Includes, without limitation, any one or more of the following activities:

(1) Music or vocals provided by one or more professional or amateur musicians or vocalists;

(2) Dancing performed by one or more professional or amateur dancers or performers;

(3) Acting or drama provided by one or more professional or amateur actors or players;

(4) Acrobatics or stunts provided by one or more professional or amateur acrobats, performers or stunt persons;

(5) Animal stunts or performances induced by one or more animal handlers or trainers, except as otherwise provided in subparagraph (7) of paragraph (b);

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(6) Athletic or sporting contests, events or exhibitions provided by one or more professional or amateur athletes or sportsmen;

(7) Comedy or magic provided by one or more professional or amateur comedians, magicians, illusionists, entertainers or performers;

(8) A show or production involving any combination of the activities described in subparagraphs (1) to (7), inclusive; and

(9) A performance involving one or more of the activities described in this paragraph by a disc jockey who presents recorded music. For the purposes of this subsection, a disc jockey shall not be deemed to have engaged in a performance involving one or more of the activities described in this paragraph if the disc jockey generally limits his interaction with patrons to introducing the recorded music, making announcements of general interest to patrons, and explaining, encouraging or directing participatory activities between patrons.

(b) Excludes, without limitation, any one or more of the following activities:

(1) Instrumental or vocal music, which may or may not be supplemented with commentary by the musicians, in a restaurant, lounge or similar area if such music does not routinely rise to the volume that interferes with casual conversation and if such music would not generally cause patrons to watch as well as listen;

(2) Occasional performances by employees whose primary job function is that of preparing, selling or serving food, refreshments or beverages to patrons, if such performances are not advertised as entertainment to the public;

(3) Performances by performers of any type if the performance occurs in a licensed gaming establishment other than a licensed gaming establishment that is licensed for less than 51 slot machines, less than 6 games, or any combination of slot machines and games within those respective limits, as long as the performers stroll continuously throughout the facility;

(4) Performances in areas other than in nightclubs, lounges, restaurants or showrooms, if the performances occur in a licensed gaming establishment other than a licensed gaming establishment that is licensed for less than 51 slot machines, less than 6 games, or any combination of slot machines and games within those respective limits, which enhance the theme of the establishment or attract patrons to the areas of the performances, as long as any seating provided in the immediate area of the performers is limited to seating at slot machines or gaming tables;

(5) Television, radio, closed circuit or Internet broadcasts of live entertainment;

(6) Entertainment provided by a patron or patrons, including, without limitation, singing by patrons or dancing by or between patrons;

(7) Animal behaviors induced by animal trainers or caretakers primarily for the purpose of education and scientific research; and

(8) An occasional activity, including, without limitation, dancing, that:

(I) Does not constitute a performance;

(II) Is not advertised as entertainment to the public;

(III) Primarily serves to provide ambience to the facility; and

(IV) Is conducted by an employee whose primary job function is not that of an entertainer.

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Sec. 10. NRS 368A.200 is hereby amended to read as follows:

368A.200 1. Except as otherwise provided in this section, there is hereby imposed an excise tax on admission to any facility in this State where live entertainment is provided. If the live entertainment is provided at a facility with a maximum seating capacity of:

(a) Less than 7,500, the rate of the tax is 10 percent of the admission charge to the facility plus 10 percent of any amounts paid for food, refreshments and merchandise purchased at the facility.

(b) At least 7,500, the rate of the tax is 5 percent of the admission charge to the facility.

2. Amounts paid for gratuities directly or indirectly remitted to persons employed at a facility where live entertainment is provided or for service charges, including those imposed in connection with the use of credit cards or debit cards, which are collected and retained by persons other than the taxpayer are not taxable pursuant to this section.

3. A business entity that collects any amount that is taxable pursuant to subsection 1 is liable for the tax imposed, but is entitled to collect reimbursement from any person paying that amount.

4. Any ticket for live entertainment must state whether the tax imposed by this section is included in the price of the ticket. If the ticket does not include such a statement, the taxpayer shall pay the tax based on the face amount of the ticket.

5. The tax imposed by subsection 1 does not apply to:

(a) Live entertainment that this State is prohibited from taxing under the Constitution, laws or treaties of the United States or the Nevada Constitution.

(b) Live entertainment that is provided by or entirely for the benefit of a nonprofit religious, charitable, fraternal or other organization that qualifies as a tax-exempt organization pursuant to 26 U.S.C. § 501(c) [.] or a nonprofit corporation organized or existing under the provisions of chapter 82 of NRS.

(d) Live entertainment that is not provided at a licensed gaming establishment if the facility in which the live entertainment is provided has a maximum seating capacity of less than [300.] 200.

(e) Live entertainment that is provided at a licensed gaming establishment that is licensed for less than 51 slot machines, less than six games, or any combination of slot machines and games within those respective limits, if the facility in which the live entertainment is provided has a maximum seating capacity of less than [300.] 200.

(f) Merchandise sold outside the facility in which the live entertainment is provided, unless the purchase of the merchandise entitles the purchaser to admission to the entertainment.

(g) Live entertainment that is provided at a trade show.

(h) Music performed by musicians who move constantly through the audience if no other form of live entertainment is afforded to the patrons.

(i) Live entertainment that is provided at a licensed gaming establishment at private meetings or dinners attended by members of a particular organization or by a casual assemblage if the purpose of the event is not primarily for entertainment.

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(j) Live entertainment that is provided in the common area of a shopping mall, unless the entertainment is provided in a facility located within the mall.

(k) Live entertainment that is incidental to an amusement ride, a motion simulator or a similar digital, electronic, mechanical or electromechanical attraction. For the purposes of this paragraph, live entertainment shall be deemed to be incidental to an amusement ride, a motion simulator or a similar digital, electronic, mechanical or electromechanical attraction if the live entertainment is:

(1) Not the predominant element of the attraction; and

(2) Not the primary purpose for which the public rides, attends or otherwise participates in the attraction.

(l) Live entertainment that is provided to the public in an outdoor area, without any requirements for the payment of an admission charge or the purchase of any food, refreshments or merchandise.

(m) An outdoor concert, unless the concert is provided on the premises of a licensed gaming establishment.

(n) Beginning July 1, 2007, race events scheduled at a race track in this State as a part of the National Association for Stock Car Auto Racing Nextel Cup Series, or its successor racing series, and all races associated therewith.

(o) Live entertainment provided in a restaurant which is incidental to any other activities conducted in the restaurant or which only serves as ambience so long as there is no charge to the patrons for that entertainment.

6. The Nevada Gaming Commission may adopt regulations establishing a procedure whereby a taxpayer that is a licensed gaming establishment may request an exemption from the tax pursuant to paragraph (o) of subsection 5. The regulations must require the taxpayer to seek an administrative ruling from the Chairman of the Board, provide a procedure for appealing that ruling to the Nevada Gaming Commission and further describe the forms of incidental or ambient entertainment exempted pursuant to that paragraph.

7. As used in this section, “maximum seating capacity” means, in the following order of priority:

(a) The maximum occupancy of the facility in which live entertainment is provided, as determined by the State Fire Marshal or the local governmental agency that has the authority to determine the maximum occupancy of the facility;

(b) If such a maximum occupancy has not been determined, the maximum occupancy of the facility designated in any permit required to be obtained in order to provide the live entertainment; or

(c) If such a permit does not designate the maximum occupancy of the facility, the actual seating capacity of the facility in which the live entertainment is provided.

Sec. 11. NRS 368A.220 is hereby amended to read as follows:

368A.220 1. Except as otherwise provided in this section:

(a) Each taxpayer who is a licensed gaming establishment shall file with the Board, on or before the 24th day of each month, a report showing the amount of all taxable receipts for the preceding month [.] or the month in which the taxable events occurred. The report must be in a form prescribed by the Board.

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(b) All other taxpayers shall file with the Department, on or before the last day of each month, a report showing the amount of all taxable receipts for the preceding month. The report must be in a form prescribed by the Department.

2. The Board or the Department, if it deems it necessary to ensure payment to or facilitate the collection by the State of the tax imposed by NRS 368A.200, may require reports to be filed not later than 10 days after the end of each calendar quarter.

3. Each report required to be filed by this section must be accompanied by the amount of the tax that is due for the period covered by the report.

4. The Board and the Department shall deposit all taxes, interest and penalties it receives pursuant to this chapter in the State Treasury for credit to the State General Fund.

Sec. 12. Chapter 372 of NRS is hereby amended by adding thereto a new section to read as follows:

In its administration of the use tax imposed by NRS 372.185, the Department shall not consider the storage, use or other consumption in this State of tangible personal property which is:

1. Worth $100 or less; and

2. Acquired free of charge at a convention, trade show or other public event.

Sec. 13. NRS 372.7263 is hereby amended to read as follows:

372.7263 1. In administering the provisions of NRS 372.335, the Department shall apply the exemption for the sale of tangible personal property delivered by the vendor to a forwarding agent for shipment out of State to include:

(a) The sale of a vehicle to a nonresident to whom a special movement permit has been issued by the Department of Motor Vehicles pursuant to subsection 1 of NRS 482.3955;

(b) The sale of farm machinery and equipment to a nonresident who submits proof to the vendor that the farm machinery and equipment will be delivered out of State not later than 15 days after the sale; and

(c) The sale of a vessel to a nonresident who submits proof to the vendor that the vessel will be delivered out of State not later than 15 days after the sale.

2. As used in this section:

(a) [“Agricultural use” has the meaning ascribed to it in NRS 361A.030.

(b)] “Farm machinery and equipment” means a farm tractor, implement of husbandry, piece of equipment used for irrigation, or a part used in the repair or maintenance of farm machinery and equipment. The term does not include:

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for [the agricultural use of real property.

(c)] agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

[(d)] (c) “Implement of husbandry” means a vehicle that is designed, adapted or used for agricultural purposes, including, without limitation, a plow, machine for mowing, hay baler, combine, piece of equipment used to stack hay, till, harvest, handle agricultural commodities or apply fertilizers, or other heavy, movable equipment designed, adapted or used for agricultural purposes.

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or other heavy, movable equipment designed, adapted or used for agricultural purposes.

Sec. 14. NRS 372.7263 is hereby amended to read as follows:

372.7263 [1.] In administering the provisions of NRS 372.335, the Department shall apply the exemption for the sale of tangible personal property delivered by the vendor to a forwarding agent for shipment out of State to include:

[(a)] 1. The sale of a vehicle to a nonresident to whom a special movement permit has been issued by the Department of Motor Vehicles pursuant to subsection 1 of NRS 482.3955;

[(b)] 2. The sale of farm machinery and equipment , as defined in section 30 of this act, to a nonresident who submits proof to the vendor that the farm machinery and equipment will be delivered out of State not later than 15 days after the sale; and

[(c)] 3. The sale of a vessel to a nonresident who submits proof to the vendor that the vessel will be delivered out of State not later than 15 days after the sale.

[2. As used in this section:

(a) “Farm machinery and equipment” means a farm tractor, implement of husbandry, piece of equipment used for irrigation, or a part used in the repair or maintenance of farm machinery and equipment. The term does not include:

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

(c) “Implement of husbandry” means a vehicle that is designed, adapted or used for agricultural purposes, including, without limitation, a plow, machine for mowing, hay baler, combine, piece of equipment used to stack hay, till, harvest, handle agricultural commodities or apply fertilizers, or other heavy, movable equipment designed, adapted or used for agricultural purposes.]

Sec. 15. Chapter 374 of NRS is hereby amended by adding thereto the provisions set forth as sections 16 and 17 of this act.

Sec. 16. In its administration of the use tax imposed by NRS 374.190, the Department shall not consider the storage, use or other consumption in a county of tangible personal property which is:

1. Worth $100 or less; and

2. Acquired free of charge at a convention, trade show or other public event.

Sec. 17. 1. There are exempted from the taxes imposed by this chapter the gross receipts from the sale, storage, use or other consumption in a county of farm machinery and equipment.

2. As used in this section:

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

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(2) Machinery or equipment only incidentally employed for agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

Sec. 18. NRS 374.030 is hereby amended to read as follows:

374.030 1. “Gross receipts” means the total amount of the sale or lease or rental price, as the case may be, of the retail sales of retailers, valued in money, whether received in money or otherwise, without any deduction on account of any of the following:

(a) The cost of the property sold. However, in accordance with such rules and regulations as the Department may prescribe, a deduction may be taken if the retailer has purchased property for some other purpose than resale, has reimbursed his vendor for tax which the vendor is required to pay to the county or has paid the use tax with respect to the property, and has resold the property before making any use of the property other than retention, demonstration or display while holding it for sale in the regular course of business. If such a deduction is taken by the retailer, no refund or credit will be allowed to his vendor with respect to the sale of the property.

(b) The cost of the materials used, labor or service cost, interest paid, losses or any other expense.

2. The total amount of the sale or lease or rental price includes all of the following:

(a) Any services that are a part of the sale.

(b) All receipts, cash, credits and property of any kind.

3. “Gross receipts” does not include any of the following:

(a) Cash discounts allowed and taken on sales.

(b) The sale price of property returned by customers when the full sale price is refunded either in cash or credit, but this exclusion does not apply in any instance when the customer, in order to obtain the refund, is required to purchase other property at a price greater than the amount charged for the property that is returned.

(d) The amount of any tax, not including any manufacturers’ or importers’ excise tax, imposed by the United States upon or with respect to retail sales, whether imposed upon the retailer or the consumer.

[(e) The amount of any allowance against the selling price given by a retailer for the value of a used vehicle which is taken in trade on the purchase of another vehicle.]

4. For purposes of the sales tax, if the retailers establish to the satisfaction of the Department that the sales tax has been added to the total amount of the sale price and has not been absorbed by them, the total amount of the sale price shall be deemed to be the amount received exclusive of the tax imposed.

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of the sale price shall be deemed to be the amount received exclusive of the tax imposed.

Sec. 19. NRS 374.070 is hereby amended to read as follows:

374.070 1. “Sales price” means the total amount for which tangible property is sold, valued in money, whether paid in money or otherwise, without any deduction on account of any of the following:

(a) The cost of the property sold.

(b) The cost of the materials used, labor or service cost, interest charged, losses, or any other expenses.

2. The total amount for which property is sold includes all of the following:

(a) Any services that are a part of the sale.

(b) Any amount for which credit is given to the purchaser by the seller.

3. “Sales price” does not include any of the following:

(a) Cash discounts allowed and taken on sales.

(b) The amount charged for property returned by customers when the entire amount charged therefor is refunded in cash or credit, except that this exclusion does not apply in any instance when the customer, in order to obtain the refund, is required to purchase other property at a price greater than the amount charged for the property that is returned.

(e) The amount of any tax imposed by the State of Nevada upon or with respect to the storage, use or other consumption of tangible personal property purchased from any retailer.

(f) The amount of any allowance against the selling price given by a retailer for the value of a used [vehicle or] vessel which is taken in trade on the purchase of another [vehicle or] vessel.

Sec. 20. NRS 375.090 is hereby amended to read as follows:

375.090 The taxes imposed by NRS 375.020, 375.023 and 375.026 do not apply to:

1. A mere change in identity, form or place of organization, such as a transfer between a corporation and its parent corporation, a subsidiary or an affiliated corporation if the affiliated corporation has identical common ownership.

2. A transfer of title to the United States, any territory or state or any agency, department, instrumentality or political subdivision thereof.

3. A transfer of title recognizing the true status of ownership of the real property.

4. A transfer of title without consideration from one joint tenant or tenant in common to one or more remaining joint tenants or tenants in common.

5. A transfer of title between spouses, including gifts, or to effect a property settlement agreement or between former spouses in compliance with a decree of divorce.

6. A transfer of title to or from a trust without consideration if a certificate of trust is presented at the time of transfer.

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7. Transfers, assignments or conveyances of unpatented mines or mining claims.

8. A transfer, assignment or other conveyance of real property to a corporation or other business organization if the person conveying the property owns 100 percent of the corporation or organization to which the conveyance is made.

9. A transfer, assignment or other conveyance of real property if the owner of the property is related to the person to whom it is conveyed within the first degree of lineal consanguinity or affinity.

10. A conveyance of real property by deed which becomes effective upon the death of the grantor pursuant to NRS 111.109.

11. The making, delivery or filing of conveyances of real property to make effective any plan of reorganization or adjustment:

(a) Confirmed under the Bankruptcy Act, as amended, 11 U.S.C. §§ 101 et seq.;

(b) Approved in an equity receivership proceeding involving a railroad, as defined in the Bankruptcy Act; or

Ê if the making, delivery or filing of instruments of transfer or conveyance occurs within 5 years after the date of the confirmation, approval or change.

12. The making or delivery of conveyances of real property to make effective any order of the Securities and Exchange Commission if:

(a) The order of the Securities and Exchange Commission in obedience to which the transfer or conveyance is made recites that the transfer or conveyance is necessary or appropriate to effectuate the provisions of section 11 of the Public Utility Holding Company Act of 1935, 15 U.S.C. § 79k;

(b) The order specifies and itemizes the property which is ordered to be transferred or conveyed; and

13. A transfer to an educational foundation. As used in this subsection, “educational foundation” has the meaning ascribed to it in subsection 3 of NRS 388.750.

14. A transfer to a university foundation. As used in this subsection, “university foundation” has the meaning ascribed to it in subsection 3 of NRS 396.405.

Sec. 21. NRS 374.265 is hereby amended to read as follows:

374.265 “Exempted from the taxes imposed by this chapter,” as used in NRS 374.265 to 374.355, inclusive, and section 17 of this act means exempted from the computation of the amount of taxes imposed.

Sec. 22. NRS 374.286 is hereby amended to read as follows:

374.286 1. There are exempted from the taxes imposed by this chapter the gross receipts from the sale , [of, and the] storage, use or other consumption in a county of [,] farm machinery and equipment . [employed for the agricultural use of real property.]

2. As used in this section:

(a) [“Agricultural use” has the meaning ascribed to it in NRS 361A.030.

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(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for [the agricultural use of real property.

(c)] agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

Sec. 23. NRS 374.7273 is hereby amended to read as follows:

374.7273 1. In administering the provisions of NRS 374.340, the Department shall apply the exemption for the sale of tangible personal property delivered by the vendor to a forwarding agent for shipment out of State to include:

(a) The sale of a vehicle to a nonresident to whom a special movement permit has been issued by the Department of Motor Vehicles pursuant to subsection 1 of NRS 482.3955;

(c) The sale of a vessel to a nonresident who submits proof to the vendor that the vessel will be delivered out of State not later than 15 days after the sale.

2. As used in this section:

(a) [“Agricultural use” has the meaning ascribed to it in NRS 361A.030.

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for [the agricultural use of real property.

(c)] agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

Sec. 24. NRS 374.7273 is hereby amended to read as follows:

374.7273 [1.] In administering the provisions of NRS 374.340, the Department shall apply the exemption for the sale of tangible personal property delivered by the vendor to a forwarding agent for shipment out of State to include:

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[(a)] 1. The sale of a vehicle to a nonresident to whom a special movement permit has been issued by the Department of Motor Vehicles pursuant to subsection 1 of NRS 482.3955;

[(c)] 3. The sale of a vessel to a nonresident who submits proof to the vendor that the vessel will be delivered out of State not later than 15 days after the sale.

[2. As used in this section:

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

Sec. 25. Section 64 of Chapter 400, Statutes of Nevada 2003, at page 2374, is hereby amended to read as follows:

Sec. 64. NRS 374.070 is hereby amended to read as follows:

374.070 1. “Sales price” means the total amount for which tangible property is sold, valued in money, whether paid in money or otherwise, without any deduction on account of any of the following:

(a) The cost of the property sold.

(b) The cost of the materials used, labor or service cost, interest charged, losses, or any other expenses.

2. The total amount for which property is sold includes all of the following:

(a) Any services that are a part of the sale.

(b) Any amount for which credit is given to the purchaser by the seller.

3. “Sales price” does not include any of the following:

(a) Cash discounts allowed and taken on sales.

(b) The amount charged for property returned by customers when the entire amount charged therefor is refunded either in cash or credit; but this exclusion does not apply in any instance when the customer, in order to obtain the refund, is required to purchase other property at a price greater than the amount charged for the property that is returned.

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ê2005 Statutes of Nevada, Page 2492 (CHAPTER 484, AB 554)ê

(d) The amount of any tax , [(] not including [, however,] any manufacturers’ or importers’ excise tax , [)] imposed by the United States upon or with respect to retail sales, whether imposed upon the retailer or the consumer.

(e) The amount of any tax imposed by the State of Nevada upon or with respect to the storage, use or other consumption of tangible personal property purchased from any retailer.

(f) The amount of any allowance against the selling price given by a retailer for the value of a used vehicle which is taken in trade on the purchase of another vehicle.

[4. For the purpose of a sale of a vehicle by a seller who is not required to be registered with the Department of Taxation, the sales price is the value established in the manner set forth in NRS 374.112.]

Sec. 26. Section 138 of Chapter 400, Statutes of Nevada 2003, at page 2409, is hereby amended to read as follows:

Sec. 138. NRS [374.107,] 374.112, 374.113, 374.286, 374.291, 374.2911, 374.322 and 374.323 are hereby repealed.

Sec. 27. Section 139 of Chapter 400, Statutes of Nevada 2003, at page 2409, is hereby amended to read as follows:

Sec. 139. 1. This section and section 102 of this act become effective upon passage and approval.

2. Sections 103 to 135, inclusive, of this act become effective on July 1, 2003.

3. Sections 1 to 29, inclusive, 32 to 38, inclusive, 40 to 50, inclusive, 52 to 57, inclusive, 66, 67, 69 to 72, inclusive, 74 to 80, inclusive, 83, 84, 85, 87 to 92, inclusive, 94 to 101, inclusive, 136 and 137 of this act become effective:

(a) Upon passage and approval for the purposes of adopting regulations and performing any other preparatory administrative tasks that are necessary to carry out the provisions of this act; and

(b) On January 1, 2006, for all other purposes.

4. Sections 30 and 39 of this act become effective on January 1, 2006, only if the proposal submitted pursuant to sections 103 to 107, inclusive, of this act is approved by the voters at the General Election on November 2, 2004.

5. Sections 31, 51, [58] 60 to 65, inclusive, 68, 73, 81, 82, 86, 93 and 138 of this act become effective on January 1, 2006, only if the proposal submitted pursuant to sections 103 to 107, inclusive, of this act is not approved by the voters at the General Election on November 2, 2004.

Sec. 28. At the General Election on November 7, 2006, a proposal must be submitted to the registered voters of this State to amend the Sales and Use Tax Act, which was enacted by the 47th session of the Legislature of the State of Nevada and approved by the Governor in 1955, and subsequently approved by the people of this State at the General Election held on November 6, 1956.

Sec. 29. At the time and in the manner provided by law, the Secretary of State shall transmit the proposed Act to the several county clerks, and the county clerks shall cause it to be published and posted as provided by law.

Sec. 30. The proclamation and notice to the voters given by the county clerks pursuant to law must be in substantially the following form:

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ê2005 Statutes of Nevada, Page 2493 (CHAPTER 484, AB 554)ê

Notice is hereby given that at the General Election on November 7, 2006, a question will appear on the ballot for the adoption or rejection by the registered voters of the State of the following proposed Act:

AN ACT to amend an Act entitled “An Act to provide revenue for the State of Nevada; providing for sales and use taxes; providing for the manner of collection; defining certain terms; providing penalties for violation, and other matters properly relating thereto.” approved March 29, 1955, as amended.

THE PEOPLE OF THE STATE OF NEVADA DO ENACT AS FOLLOWS:

Section 1. The above-entitled Act, being Chapter 397, Statutes of Nevada 1955, at page 762, is hereby amended by adding thereto a new section to be designated as section 18.2, immediately following section 18.1, to read as follows:

Sec. 18.2. “Vehicle” has the meaning ascribed to it in NRS 482.135.

Sec. 2. The above-entitled Act, being Chapter 397, Statutes of Nevada 1955, at page 762, is hereby amended by adding thereto a new section to be designated section 55.5, immediately following section 55 to read as follows:

Sec. 55.5. 1. There are exempted from the taxes imposed by this Act the gross receipts from the sale, storage, use or other consumption in a county of farm machinery and equipment.

2. As used in this section:

(1) A vehicle required to be registered pursuant to the provisions of chapter 482 or 706 of NRS; or

(2) Machinery or equipment only incidentally employed for agricultural purposes.

(b) “Farm tractor” means a motor vehicle designed and used primarily for drawing an implement of husbandry.

Sec. 3. Section 11 of the above-entitled Act, being Chapter 397, Statutes of Nevada 1955, at page 764, is hereby amended to read as follows:

Sec. 11. 1. “Sales price” means the total amount for which tangible property is sold, valued in money, whether paid in money or otherwise, without any deduction on account of any of the following:

(a) The cost of the property sold.

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ê2005 Statutes of Nevada, Page 2494 (CHAPTER 484, AB 554)ê

(b) The cost of materials used, labor or service cost, interest charged, losses, or any other expenses.

2. The total amount for which property is sold includes all of the following:

(a) Any services that are a part of the sale.

(b) Any amount for which credit is given to the purchaser by the seller.

3. “Sales price” does not include any of the following:

(a) Cash discounts allowed and taken on sales.

(b) The amount charged for property returned by customers when the entire amount charged therefor is refunded either in cash or credit [; but] , except that this exclusion [shall] does not apply in any instance when the customer, in order to obtain the refund, is required to purchase other property at a price greater than the amount charged for the property that is returned.

(e) The amount of any allowance against the selling price given by a retailer for the value of a used vehicle which is taken in trade on the purchase of another vehicle.

Sec. 4. Section 12 of the above-entitled Act, being Chapter 397, Statutes of Nevada 1955, at page 764, is hereby amended to read as follows:

Sec. 12. 1. “Gross receipts” means the total amount of the sale or lease or rental price, as the case may be, of the retail sales of retailers, valued in money, whether received in money or otherwise, without any deduction on account of any of the following:

(a) The cost of the property sold. However, in accordance with such rules and regulations as the Tax Commission may prescribe, a deduction may be taken if the retailer has purchased property for some other purpose than resale, has reimbursed his vendor for tax which the vendor is required to pay to the State or has paid the use tax with respect to the property, and has resold the property [prior to] before making any use of the property other than retention, demonstration or display while holding it for sale in the regular course of business. If such a deduction is taken by the retailer, no refund or credit will be allowed to his vendor with respect to the sale of the property.

(b) The cost of the materials used, labor or service cost, interest paid, losses [,] or any other expense.

2. The total amount of the sale or lease or rental price includes all of the following:

(a) Any services that are a part of the sale.

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ê2005 Statutes of Nevada, Page 2495 (CHAPTER 484, AB 554)ê

(b) All receipts, cash, credits [,] and property of any kind.

3. “Gross receipts” [do] does not include any of the following:

(a) Cash discounts allowed and taken on sales.

(b) [Sale] The sale price of property returned by customers when the full sale price is refunded either in cash or credit , [;] but this exclusion [shall] does not apply in any instance when the customer, in order to obtain the refund, is required to purchase other property at a price greater than the amount charged for the property that is returned.

(d) The amount of any tax , [(] not including [, however,] any manufacturers’ or importers’ excise tax , [)] imposed by the United States upon or with respect to retail sales , whether imposed upon the retailer or the consumer.

(e) The amount of any allowance against the selling price given by a retailer for the value of a used vehicle which is taken in trade on the purchase of another vehicle.

4. For purposes of the sales tax, if the retailers establish to the satisfaction of the Tax Commission that the sales tax has been added to the total amount of the sale price and has not been absorbed by them, the total amount of the sale price shall be deemed to be the amount received exclusive of the tax imposed.

Sec. 5. This Act becomes effective on January 1, 2007.

Sec. 31. The ballot page assemblies and the paper ballots to be used in voting on the question must present the question in substantially the following form:

Shall the Sales and Use Tax Act of 1955 be amended to exempt from the taxes imposed by this Act on the gross receipts from the sale and the storage, use or other consumption of tangible personal property, the value of any used vehicle taken in trade on the purchase of another vehicle and to exempt from the taxes imposed by this Act on the gross receipts from the sale and the storage, use or other consumption of tangible personal property, the value of farm machinery and equipment?

Yes ¨ No ¨

Sec. 32. The explanation of the question which must appear on each paper ballot and sample ballot and in every publication and posting of notice of the question must be in substantially the following form:

(Explanation of Question)

The proposed amendment to the Sales and Use Tax Act of 1955 would exempt from the taxes imposed by this Act on the gross receipts from the sale and the storage, use or other consumption of tangible personal property, the value of any used vehicle taken in trade on the purchase of another vehicle and the value of farm machinery and equipment. The Legislature has amended the Local School Support Tax Law and the City-County Relief Tax Law to provide the same exemption for farm machinery and equipment if this proposal is adopted.

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ê2005 Statutes of Nevada, Page 2496 (CHAPTER 484, AB 554)ê

provide the same exemption for farm machinery and equipment if this proposal is adopted.

Sec. 33. If a majority of the votes cast on the question submitted to the voters is yes, the amendment to the Sales and Use Tax Act of 1955 becomes effective on January 1, 2007. If less than a majority of votes cast on the question submitted to the voters is yes, the question fails and the amendment to the Sales and Use Tax Act of 1955 does not become effective.

Sec. 34. All general election laws not inconsistent with this act are applicable.

Sec. 35. Any informalities, omissions or defects in the content or making of the publications, proclamations or notices provided for in this act and by the general election laws under which this election is held must be so construed as not to invalidate the adoption of the act by a majority of the registered voters voting on the question if it can be ascertained with reasonable certainty from the official returns transmitted to the Office of the Secretary of State whether the proposed amendment was adopted by a majority of those registered voters.

Sec. 36. 1. NRS 368A.130 and 368A.210 are hereby repealed.

2. NRS 374.107 is hereby repealed.

3. Sections 58 and 59 of Chapter 400, Statutes of Nevada 2003, at page 2371, are hereby repealed.

Sec. 37. 1. This section becomes effective upon passage and approval.

2. Section 22 of this act:

(a) Becomes effective upon passage and approval for the purpose of adopting regulations and on July 1, 2005, for all other purposes; and

(b) Expires by limitation on December 21, 2005.

3. Sections 1 to 12, inclusive, 15, 16, 20 and subsection 1 of section 36 of this act become effective on July 1, 2005.

4. Sections 25 to 35, inclusive, and subsection 3 of section 36 of this act become effective on October 1, 2005.

5. Sections 13 and 23 of this act become effective on January 1, 2006.

6. Sections 14, 17, 21 and 24 of this act become effective on January 1, 2007, only if the proposal submitted pursuant to sections 28 to 35, inclusive, of this act is approved by the voters at the General Election on November 7, 2006.

7. Sections 18, 19 and subsection 2 of section 36 of this act become effective on January 1, 2007, only if the proposal submitted pursuant to sections 28 to 35, inclusive, of this act is not approved by the voters at the General Election on November 7, 2006.

________

CHAPTER 485, SB 347

Senate Bill No. 347–Senators Wiener, Titus, Raggio and Townsend

Joint Sponsor: Assemblyman Anderson

CHAPTER 485

AN ACT relating to personal identifying information; prohibiting the establishment or possession of a financial forgery laboratory; enhancing the penalties for crimes involving personal identifying information that are committed against older persons and vulnerable persons; requiring the issuer of a credit card to provide a notice including certain information concerning its policies regarding identity theft and the rights of cardholders when issuing a credit card to a cardholder; requiring data collectors to provide notification concerning any breach of security involving system data; making various other changes concerning personal identifying information; providing penalties; and providing other matters properly relating thereto.

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ê2005 Statutes of Nevada, Page 2497 (CHAPTER 485, SB 347)ê

persons; requiring the issuer of a credit card to provide a notice including certain information concerning its policies regarding identity theft and the rights of cardholders when issuing a credit card to a cardholder; requiring data collectors to provide notification concerning any breach of security involving system data; making various other changes concerning personal identifying information; providing penalties; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 205 of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 6, inclusive, of this act.

Sec. 2. “Artificial person” means any corporation, limited-liability company, limited-liability partnership, limited partnership, limited-liability limited partnership, business trust or municipal corporation or any comparable entity which is created and existing under the laws of this State, any other state, territory or foreign government, or the Government of the United States and which is doing business in this State.

Sec. 3. “Older person” means a person who is 60 years of age or older.

Sec. 4. “Vulnerable person” means a person who:

1. Suffers from a condition of physical or mental incapacitation because of a developmental disability, organic brain damage or mental illness; or

2. Has one or more physical or mental limitations that restrict the ability of the person to perform the normal activities of daily living.

Sec. 5. In any case in which a person is convicted of violating any provision of NRS 205.461 to 205.4657, inclusive, and sections 2 to 5, inclusive, of this act, the court records must clearly reflect that the violation was committed by the person convicted of the violation and not by the person whose personal identifying information forms a part of the violation.

Sec. 6. 1. A person shall not establish or possess a financial forgery laboratory with the intent to commit any unlawful act.

2. Unless a greater penalty is provided pursuant to specific statute, a person who violates this section is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

3. For the purposes of prosecuting a violation of this section, the prosecuting attorney may present expert testimony to provide a prima facie case that any computer, system, program or electronic or mechanical device, or any combination thereof, is specifically configured for any purpose set forth in subparagraph (1) or (2) of paragraph (b) of subsection 4.

4. As used in this section:

(a) “Computer” has the meaning ascribed to it in NRS 205.4735.

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ê2005 Statutes of Nevada, Page 2498 (CHAPTER 485, SB 347)ê

(b) “Financial forgery laboratory” means any computer, system, program or other electronic or mechanical device, or any combination thereof, that is specifically configured for the purpose of unlawfully:

(1) Obtaining personal identifying information of another person to commit an unlawful act; or

(2) Manufacturing any forged or fraudulent financial instrument, document or item, including, without limitation, any negotiable instrument, check, draft, bond, credit card, debit card, stock certificate, annuity, bank bill or note, draft, bill of exchange, contract, promissory note, traveler’s check or money order.

(d) “Program” has the meaning ascribed to it in NRS 205.475.

(e) “System” has the meaning ascribed to it in NRS 205.476.

Sec. 7. NRS 205.461 is hereby amended to read as follows:

205.461 As used in NRS 205.461 to 205.4657, inclusive, and sections 2 to 5, inclusive, of this act, unless the context otherwise requires, the words and terms defined in NRS 205.4613 to 205.4627, inclusive, and sections 2, 3 and 4 of this act have the meanings ascribed to them in those sections.

Sec. 8. NRS 205.4617 is hereby amended to read as follows:

205.4617 [“Personal]

1. Except as otherwise provided in subsection 2, “personal identifying information” means any information designed, commonly used or capable of being used, alone or in conjunction with any other information, to identify a living or deceased person, including, without limitation:

[1.] (a) The current or former name, driver’s license number, identification card number, social security number, checking account number, savings account number, credit card number, debit card number, financial services account number, date of birth, place of employment and maiden name of the mother of a person . [; and

2.] (b) The unique biometric data of a person, including, without limitation, the fingerprints, facial scan identifiers, voiceprint, retina image and iris image of a person.

(c) The electronic signature, unique electronic identification number, address or routing code, telecommunication identifying information or access device of a person.

(d) The personal identification number or password of a person.

(e) The alien registration number, government passport number, employer identification number, taxpayer identification number, Medicaid account number, food stamp account number, medical identification number or health insurance identification number of a person.

(f) The number of any professional, occupational, recreational or governmental license, certificate, permit or membership of a person.

(g) The number, code or other identifying information of a person who receives medical treatment as part of a confidential clinical trial or study, who participates in a confidential clinical trial or study involving the use of prescription drugs or who participates in any other confidential medical, psychological or behavioral experiment, study or trial.

(h) The utility account number of a person.

2. To the extent that any information listed in subsection 1 is designed, commonly used or capable of being used, alone or in conjunction with any other information, to identify an artificial person, “personal identifying information” includes information pertaining to an artificial person.

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ê2005 Statutes of Nevada, Page 2499 (CHAPTER 485, SB 347)ê

identifying information” includes information pertaining to an artificial person.

Sec. 9. NRS 205.463 is hereby amended to read as follows:

205.463 1. Except as otherwise provided in [subsection 2,] subsections 2 and 3, a person who knowingly:

(a) Obtains any personal identifying information of another person; and

(b) Uses the personal identifying information to harm that other person or for any unlawful purpose, including, without limitation, to obtain credit, a good, a service or anything of value in the name of that person,

Ê is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

2. [A] Except as otherwise provided in subsection 3, a person who knowingly:

(a) Obtains any personal identifying information of another person; and

(b) Uses the personal identifying information to avoid or delay being prosecuted for an unlawful act,

Ê is guilty of a category [E] C felony and shall be punished as provided in NRS 193.130.

3. A person who violates:

(a) Subsection 1 or 2 by obtaining and using the personal identifying information of an older person or a vulnerable person; or

(b) Subsection 2 to avoid or delay being prosecuted for an unlawful act that is punishable as a category A felony or category B felony,

Ê is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 3 years and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

4. In addition to any other penalty, the court shall order a person convicted of violating subsection 1 to pay restitution, including, without limitation, any attorney’s fees and costs incurred to:

(a) Repair the credit history or rating of the person whose personal identifying information he obtained and used in violation of subsection 1; and

(b) Satisfy a debt, lien or other obligation incurred by the person whose personal identifying information he obtained and used in violation of subsection 1.

Sec. 10. NRS 205.464 is hereby amended to read as follows:

205.464 1. [A] Except as otherwise provided in subsection 2, a public officer or public employee who knowingly:

(a) Obtains any personal identifying information of another person from any document, file, database, source or process used by a public body to collect, store, maintain, transfer, reproduce, manage or administer personal identifying information; and

Ê is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 5 years and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

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ê2005 Statutes of Nevada, Page 2500 (CHAPTER 485, SB 347)ê

2. [In addition to any other penalty, the court shall order a public officer or public employee convicted of violating subsection 1 to pay restitution, including, without limitation, any attorney’s fees and costs incurred to:

(a) Repair the credit history or rating of the person whose personal identifying information the public officer or public employee obtained and used in violation of subsection 1; and

(b) Satisfy a debt, lien or other obligation incurred by the person whose personal identifying information the public officer or public employee obtained and used in violation of subsection 1.

3.] A public officer or public employee who violates subsection 1 by obtaining and using the personal identifying information of an older person or a vulnerable person is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 7 years and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

3. Except as otherwise provided in subsection 4, a public officer or public employee who knowingly:

(b) Possesses, sells or transfers the personal identifying information for the purpose of establishing a false status, occupation, membership, license or identity for himself or any other person,

Ê is guilty of a category C felony and shall be punished as provided in NRS 193.130.

4. A public officer or public employee who violates subsection 3 by obtaining and possessing, selling or transferring the personal identifying information of an older person or a vulnerable person is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

5. Except as otherwise provided in subsection 6, a public officer or public employee who knowingly aids another public officer or public employee to commit a violation of any provision of this section is guilty of a category C felony and shall be punished as provided in NRS 193.130.

[5.] 6. A public officer or public employee who violates subsection 5 by knowingly aiding another public officer or public employee in committing a violation of this section by obtaining the personal identifying information of an older person or a vulnerable person is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

7. The provisions of this section do not prohibit the possession or use of any personal identifying information by officers of local police, sheriff and metropolitan police departments and by agents of the Investigation Division of the Department of Public Safety while engaged in undercover investigations related to the lawful discharge of their duties.

8. In addition to any other penalty, the court shall order a public officer or public employee convicted of violating any provision of this section to pay restitution, including, without limitation, any attorney’s fees and costs incurred to:

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ê2005 Statutes of Nevada, Page 2501 (CHAPTER 485, SB 347)ê

section to pay restitution, including, without limitation, any attorney’s fees and costs incurred to:

(a) Repair the credit history or rating of the person whose personal identifying information the public officer or public employee obtained and used in violation of subsection 1; and

(b) Satisfy a debt, lien or other obligation incurred by the person whose personal identifying information the public officer or public employee obtained and used in violation of this section.

Sec. 11. NRS 205.465 is hereby amended to read as follows:

205.465 1. It is unlawful for a person to possess, sell or transfer any document or personal identifying information for the purpose of establishing a false status, occupation, membership, license or identity for himself or any other person.

2. [A] Except as otherwise provided in subsection 3, a person who:

(a) Sells or transfers any such document or personal identifying information in violation of subsection 1; or

(b) Possesses any such document or personal identifying information in violation of subsection 1 to commit any of the crimes set forth in NRS 205.085 to 205.217, inclusive, 205.473 to 205.513, inclusive, or 205.610 to 205.810, inclusive,

Ê is guilty of a category C felony and shall be punished as provided in NRS 193.130.

3. A person who violates subsection 2 by selling or transferring the personal identifying information of an older person or a vulnerable person is guilty of a category B felony and shall be punished by imprisonment in the state prison for a minimum term of not less than 1 year and a maximum term of not more than 20 years, and may be further punished by a fine of not more than $100,000.

4. Except as otherwise provided in this subsection and [subsection 2,] subsections 2 and 3, a person who possesses any such document or personal identifying information in violation of subsection 1 is guilty of a category E felony and shall be punished as provided in NRS 193.130. If a person possesses any such document or personal identifying information in violation of subsection 1 for the sole purpose of establishing false proof of age, including, without limitation, establishing false proof of age to game, purchase alcoholic beverages or purchase cigarettes or other tobacco products, the person is guilty of a misdemeanor.

[4.] 5. Subsection 1 does not:

(a) Preclude the adoption by a city or county of an ordinance prohibiting the possession of any such document or personal identifying information; or

(b) Prohibit the possession or use of any such document or personal identifying information by officers of local police, sheriff and metropolitan police departments and by agents of the Investigation Division of the Department of Public Safety while engaged in undercover investigations related to the lawful discharge of their duties.

Sec. 12. NRS 205.4653 is hereby amended to read as follows:

205.4653 A person who violates any provision of NRS 205.461 to 205.4657, inclusive, and sections 2 to 5, inclusive, of this act may be prosecuted for the violation whether or not the person whose personal identifying information forms a part of the violation [is] :

1. Is living or deceased during the course of the violation or the prosecution.

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ê2005 Statutes of Nevada, Page 2502 (CHAPTER 485, SB 347)ê

2. Is an artificial person.

3. Suffers financial loss or injury as the result of the violation.

Sec. 13. NRS 205.4657 is hereby amended to read as follows:

205.4657 1. In any prosecution for a violation of any provision of NRS 205.461 to 205.4657, inclusive, and sections 2 to 5, inclusive, of this act, the State is not required to establish and it is no defense that:

[1.] (a) An accessory has not been convicted, apprehended or identified; or

[2.] (b) Some of the acts constituting elements of the crime did not occur in this State or that where such acts did occur they were not a crime or elements of a crime.

2. In any prosecution for a violation of any provision of NRS 205.461 to 205.4657, inclusive, and sections 2 to 5, inclusive, of this act, the violation shall be deemed to have been committed and may be prosecuted in any jurisdiction in this State in which:

(a) The person whose personal identifying information forms a part of the violation currently resides or is found; or

(b) Any act constituting an element of the crime occurred, regardless of whether the defendant was ever physically present in that jurisdiction.

Sec. 14. Chapter 97A of NRS is hereby amended by adding thereto a new section to read as follows:

1. When issuing a credit card to a cardholder in this State, an issuer shall provide the cardholder with the written notice in the form prescribed by the Commissioner of Financial Institutions pursuant to this section.

2. The Commissioner of Financial Institutions shall adopt regulations prescribing the form of the written notice required pursuant to this section. The regulations must provide that the written notice must:

(a) Include, without limitation, the following information:

(1) The policies and procedures adopted by the issuer to protect the personal identifying information and credit information of the cardholder from any unlawful use by another person; and

(2) The legal rights and responsibilities of the cardholder if another person unlawfully uses the personal identifying information and credit information of the cardholder; and

(b) Be printed in a separate box created by bold lines that includes:

(1) A heading indicating the general subject matter of the notice that is printed in at least 12-point type; and

(2) The text of the notice that is printed in at least 10-point type.

3. An issuer that is subject to and complies with the privacy and security provisions of the Gramm-Leach-Bliley Act, 15 U.S.C. §§ 6801 et seq., shall be deemed to be in compliance with the notification requirements of this section.

4. As used in this section:

(a) “Credit information” means any information that is related to credit and derived from a consumer credit report, found on a consumer credit report or provided on an application for a credit card.

(b) “Personal identifying information” has the meaning ascribed to it in NRS 205.4617.

Sec. 15. NRS 97A.140 is hereby amended to read as follows:

97A.140 1. An issuer located in this State shall not issue a credit card to a cardholder unless [he first receives] the issuer first:

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ê2005 Statutes of Nevada, Page 2503 (CHAPTER 485, SB 347)ê

(a) Provides the written notice required pursuant to section 14 of this act to the cardholder; and

(b) Receives a written or oral request from the cardholder for the issuance of the credit card.

2. An issuer shall provide the cardholder with the terms and conditions that govern the use of the credit card, in writing, before or at the time of the receipt of the credit card. A cardholder shall be deemed to have accepted the written terms and conditions provided by the issuer upon subsequent actual use of the credit card.

3. The rate of interest charged, and any other fees or charges imposed for the use of the credit card, must be in an amount agreed upon by the issuer and cardholder.

4. An issuer may unilaterally change any term or condition for the use of a credit card without prior written notice to the cardholder unless the change will adversely affect or increase the costs to the cardholder for the use of the credit card. If the change will increase such costs, the issuer shall provide notice to the cardholder of the change at least 30 days before the change becomes effective.

5. Unless otherwise stated as a term or condition, the law of this State governs all transactions relating to the use of a credit card if an issuer, or the service provider of an issuer, is located in this State.

Sec. 16. Chapter 239B of NRS is hereby amended by adding thereto a new section to read as follows:

1. If a public body maintains a website on the Internet, the public body shall not disclose on that website personal information unless the disclosure is required by a federal or state statute or regulation.

2. If it appears that a public body has engaged in or is about to engage in any act or practice which violates subsection 1, the Attorney General or the appropriate district attorney may file an action in any court of competent jurisdiction for an injunction to prevent the occurrence or continuance of that act or practice.

3. An injunction:

(a) May be issued without proof of actual damage sustained by any person.

(b) Does not preclude the criminal prosecution and punishment of an act or practice that may otherwise be prohibited by law.

4. As used in this section:

(a) “Personal information” has the meaning ascribed to it in section 21 of this act.

(b) “Public body” has the meaning ascribed to it in NRS 205.462.

Sec. 17. Title 52 of NRS is hereby amended by adding thereto a new chapter to consist of the provisions set forth as sections 18 to 28, inclusive, of this act.

Sec. 18. As used in this chapter, unless the context otherwise requires, the words and terms defined in sections 19, 20 and 21 of this act have the meanings ascribed to them in those sections.

Sec. 19. “Breach of the security of the system data” means unauthorized acquisition of computerized data that materially compromises the security, confidentiality or integrity of personal information maintained by the data collector. The term does not include the good faith acquisition of personal information by an employee or agent of the data collector for a legitimate purpose of the data collector, so long as the personal information is not used for a purpose unrelated to the data collector or subject to further unauthorized disclosure.

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ê2005 Statutes of Nevada, Page 2504 (CHAPTER 485, SB 347)ê

as the personal information is not used for a purpose unrelated to the data collector or subject to further unauthorized disclosure.

Sec. 20. “Data collector” means any governmental agency, institution of higher education, corporation, financial institution or retail operator or any other type of business entity or association that, for any purpose, whether by automated collection or otherwise, handles, collects, disseminates or otherwise deals with nonpublic personal information.

Sec. 21. “Personal information” means a natural person’s first name or first initial and last name in combination with any one or more of the following data elements, when the name and data elements are not encrypted:

1. Social security number or employer identification number.

2. Driver’s license number or identification card number.

3. Account number, credit card number or debit card number, in combination with any required security code, access code or password that would permit access to the person’s financial account.

Ê The term does not include publicly available information that is lawfully made available to the general public.

Sec. 22. 1. A business that maintains records which contain personal information concerning the customers of the business shall take reasonable measures to ensure the destruction of those records when the business decides that it will no longer maintain the records.

2. As used in this section:

(a) “Business” means a proprietorship, corporation, partnership, association, trust, unincorporated organization or other enterprise doing business in this State.

(b) “Reasonable measures to ensure the destruction” means any method that modifies the records containing the personal information in such a way as to render the personal information contained in the records unreadable or undecipherable, including, without limitation:

(1) Shredding of the record containing the personal information; or

(2) Erasing of the personal information from the records.

Sec. 23. 1. A data collector that maintains records which contain personal information of a resident of this State shall implement and maintain reasonable security measures to protect those records from unauthorized access, acquisition, destruction, use, modification or disclosure.

2. A contract for the disclosure of the personal information of a resident of this State which is maintained by a data collector must include a provision requiring the person to whom the information is disclosed to implement and maintain reasonable security measures to protect those records from unauthorized access, acquisition, destruction, use, modification or disclosure.

3. If a state or federal law requires a data collector to provide greater protection to records that contain personal information of a resident of this State which are maintained by the data collector and the data collector is in compliance with the provisions of that state or federal law, the data collector shall be deemed to be in compliance with the provisions of this section.

Sec. 24. 1. Any data collector that owns or licenses computerized data which includes personal information shall disclose any breach of the security of the system data following discovery or notification of the breach to any resident of this State whose unencrypted personal information was, or is reasonably believed to have been, acquired by an unauthorized person.

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ê2005 Statutes of Nevada, Page 2505 (CHAPTER 485, SB 347)ê

security of the system data following discovery or notification of the breach to any resident of this State whose unencrypted personal information was, or is reasonably believed to have been, acquired by an unauthorized person. The disclosure must be made in the most expedient time possible and without unreasonable delay, consistent with the legitimate needs of law enforcement, as provided in subsection 3, or any measures necessary to determine the scope of the breach and restore the reasonable integrity of the system data.

2. Any data collector that maintains computerized data which includes personal information that the data collector does not own shall notify the owner or licensee of the information of any breach of the security of the system data immediately following discovery if the personal information was, or is reasonably believed to have been, acquired by an unauthorized person.

3. The notification required by this section may be delayed if a law enforcement agency determines that the notification will impede a criminal investigation. The notification required by this section must be made after the law enforcement agency determines that the notification will not compromise the investigation.

4. For purposes of this section, except as otherwise provided in subsection 5, the notification required by this section may be provided by one of the following methods:

(a) Written notification.

(b) Electronic notification, if the notification provided is consistent with the provisions of the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. §§ 7001 et seq.

(c) Substitute notification, if the data collector demonstrates that the cost of providing notification would exceed $250,000, the affected class of subject persons to be notified exceeds 500,000 or the data collector does not have sufficient contact information. Substitute notification must consist of all the following:

(1) Notification by electronic mail when the data collector has electronic mail addresses for the subject persons.

(2) Conspicuous posting of the notification on the Internet website of the data collector, if the data collector maintains an Internet website.

(3) Notification to major statewide media.

5. A data collector which:

(a) Maintains its own notification policies and procedures as part of an information security policy for the treatment of personal information that is otherwise consistent with the timing requirements of this section shall be deemed to be in compliance with the notification requirements of this section if the data collector notifies subject persons in accordance with its policies and procedures in the event of a breach of the security of the system data.

(b) Is subject to and complies with the privacy and security provisions of the Gramm-Leach-Bliley Act, 15 U.S.C. §§ 6801 et seq., shall be deemed to be in compliance with the notification requirements of this section.

6. If a data collector determines that notification is required to be given pursuant to the provisions of this section to more than 1,000 persons at any one time, the data collector shall also notify, without unreasonable delay, any consumer reporting agency, as that term is defined in 15 U.S.C. § 1681a(p), that compiles and maintains files on consumers on a nationwide basis, of the time the notification is distributed and the content of the notification.

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ê2005 Statutes of Nevada, Page 2506 (CHAPTER 485, SB 347)ê

nationwide basis, of the time the notification is distributed and the content of the notification.

Sec. 25. A data collector who provides the notification required pursuant to section 24 of this act may commence an action for damages against a person that unlawfully obtained or benefited from personal information obtained from records maintained by the data collector. A data collector that prevails in such an action may be awarded damages which may include, without limitation, the reasonable costs of notification, reasonable attorney’s fees and costs and punitive damages when appropriate. The costs of notification include, without limitation, labor, materials, postage and any other costs reasonably related to providing the notification.

Sec. 26. In addition to any other penalty provided by law for the breach of the security of the system data maintained by a data collector, the court may order a person who is convicted of unlawfully obtaining or benefiting from personal information obtained as a result of such breach to pay restitution to the data collector for the reasonable costs incurred by the data collector in providing the notification required pursuant to section 24 of this act, including, without limitation, labor, materials, postage and any other costs reasonably related to providing such notification.

Sec. 27. Any waiver of the provisions of this chapter is contrary to public policy, void and unenforceable.

Sec. 28. If the Attorney General or a district attorney of any county has reason to believe that any person is violating, proposes to violate or has violated the provisions of this chapter, he may bring an action against that person to obtain a temporary or permanent injunction against the violation.

Sec. 29. Chapter 597 of NRS is hereby amended by adding thereto a new section to read as follows:

1. A business in this State shall not transfer any personal information of a customer through an electronic transmission other than a facsimile to a person outside of the secure system of the business unless the business uses encryption to ensure the security of electronic transmission.

2. As used in this section:

(a) “Encryption” has the meaning ascribed to it in NRS 205.4742.

(b) “Personal information” has the meaning ascribed to it in section 21 of this act.

Sec. 30. 1. This section and sections 1 to 13, inclusive, of this act become effective on October 1, 2005.

2. Sections 14 to 28, inclusive, of this act become effective on January 1, 2006.

3. Section 29 of this act becomes effective on October 1, 2008.

________

CHAPTER 486, AB 334

Assembly Bill No. 334–Assemblywoman Buckley

CHAPTER 486

AN ACT relating to privacy; requiring a governmental entity, except in certain circumstances, to ensure that social security numbers in its books and records are maintained in a confidential manner; prohibiting the inclusion of social security numbers in certain documents that are recorded, filed or otherwise submitted to a governmental agency; requiring a governmental agency or certain persons who do business in this State that own, license or maintain computerized data to notify certain persons if personal information included in that data was, or is reasonably believed to have been, acquired by an unauthorized person; expanding the types of prohibited computer contaminants to include spyware; requiring the Chief of the Hearings Division of the Department of Administration to adopt regulations to provide for the redaction of personal identifying information of a person filing a claim for certain compensation from certain documents; and providing other matters properly relating thereto.

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ê2005 Statutes of Nevada, Page 2507 (CHAPTER 486, AB 334)ê

documents that are recorded, filed or otherwise submitted to a governmental agency; requiring a governmental agency or certain persons who do business in this State that own, license or maintain computerized data to notify certain persons if personal information included in that data was, or is reasonably believed to have been, acquired by an unauthorized person; expanding the types of prohibited computer contaminants to include spyware; requiring the Chief of the Hearings Division of the Department of Administration to adopt regulations to provide for the redaction of personal identifying information of a person filing a claim for certain compensation from certain documents; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 239 of NRS is hereby amended by adding thereto a new section to read as follows:

Except as otherwise required to carry out a specific statute, a governmental agency shall ensure that the social security number of a person in its books and records is maintained in a confidential manner.

Sec. 2. Chapter 239B of NRS is hereby amended by adding thereto the provisions set forth as sections 3 and 4 of this act.

Sec. 3. 1. Except as otherwise provided in subsection 2, a person shall not include and a governmental agency shall not require a person to include the social security number of a person on any document that is recorded, filed or otherwise submitted to the governmental agency on or after January 1, 2007.

2. If the social security number of a person is required to be included in a document that is recorded, filed or otherwise submitted to a governmental agency on or after January 1, 2007, pursuant to a specific state or federal law, for the administration of a public program or for an application for a federal or state grant, a governmental agency shall ensure that the social security number is maintained in a confidential manner and may only disclose the social security number as required:

(a) To carry out a specific state or federal law; or

(b) For the administration of a public program or an application for a federal or state grant.

3. A governmental agency shall take necessary measures to ensure that notice of the provisions of this section is provided to persons with whom it conducts business. Such notice may include, without limitation, posting notice in a conspicuous place in each of its offices.

4. A governmental agency may require a person who records, files or otherwise submits any document to the governmental agency to provide an affirmation that the document does not contain the social security number of any person. A governmental agency may refuse to record, file or otherwise accept a document which does not contain such an affirmation when required and any document which contains the social security number of a person.

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ê2005 Statutes of Nevada, Page 2508 (CHAPTER 486, AB 334)ê

5. On or before January 1, 2017, each governmental agency shall ensure that any social security number contained in a document that has been recorded, filed or otherwise submitted to the governmental agency before January 1, 2007, which the governmental agency continues to hold is maintained in a confidential manner or is obliterated or otherwise removed from the document. Any action taken by a governmental agency pursuant to this subsection must not be construed as affecting the legality of the document.

6. As used in this section, “governmental agency” means an officer, board, commission, department, division, bureau, district or any other unit of government of the State or a local government.

Sec. 4. 1. Except as otherwise provided in subsection 4, upon discovery of any breach of the security of any of its computer systems, a governmental agency that:

(a) Owns or licenses computerized data that includes personal information shall notify, in the manner set forth in subsection 2, any resident of this State whose personal information included in that data was, or is reasonably believed to have been, acquired by an unauthorized person.

(b) Maintains computerized data that includes personal information that the governmental agency does not own shall notify, in the manner set forth in subsection 2, the owner or licensee of the data if the personal information included in that data was, or is reasonably believed to have been, acquired by an unauthorized person.

2. Except as otherwise provided in subsection 3, the notice required pursuant to subsection 1 must be provided as soon as practicable, but not less than 30 days after the governmental agency knows or should have known of the breach, by:

(a) Written notice;

(b) If the notice is consistent with the provisions regarding electronic records and signatures set forth in 15 U.S.C. § 7001, electronic notice; or

(c) Any other method established by the governmental agency as part of a policy for the security of its computer systems that provides for notification as soon as practicable, but not less than 30 days after the governmental agency knows or should have known of the breach, to the owner or licensee of the data that includes the personal information, or to persons whose personal information included in that data was, or is reasonably believed to have been, acquired by another person.

3. If the governmental agency determines that it would have to provide the notice required pursuant to subsection 1 to more than 500,000 persons, if the governmental agency does not have sufficient contact information to provide the notice by the methods described in subsection 2 or if the cost to the governmental agency of providing the notice by the methods described in subsection 2 would be more than $250,000, the governmental agency may provide the notice required pursuant to subsection 1 by:

(a) If the governmental agency has an electronic mail address for the owner or licensee of the data containing the personal information, or the person whose personal information was, or is reasonably believed to have been, acquired by another person, electronic mail;

(b) If the governmental agency maintains an Internet website, posting the notice in a conspicuous place on its Internet website; and

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ê2005 Statutes of Nevada, Page 2509 (CHAPTER 486, AB 334)ê

4. If a law enforcement agency determines that the notice required pursuant to subsection 1 may impede a criminal investigation, the governmental agency shall delay such notice until the law enforcement agency determines that the notice will not compromise the criminal investigation.

5. A person who has suffered injury as the proximate result of a violation of this section may commence an action against the governmental agency for the recovery of his actual damages, costs and reasonable attorney’s fees, subject to any applicable limitations set forth in NRS 41.0305 to 41.039, inclusive. An action described in this subsection must be commenced not later than 2 years after the person who suffered the injury discovers the facts constituting the violation of this section.

6. As used in this section:

(a) “Governmental agency” means an officer, board, commission, department, division, bureau, district or any other unit of government of the State or a local government.

(b) “Personal information” means the name of a person and one or more of the following types of information:

(1) The social security number of the person.

(2) The driver’s license number or identification card number of the person.

(3) The bank account number, credit card number or debit card number of the person in combination with any required security code, access code or password that would allow access to the related account or other personal information of the person.

Sec. 5. NRS 205.4737 is hereby amended to read as follows:

205.4737 1. “Computer contaminant” means any data, information, image, program, signal or sound that is designed or has the capability to:

(a) Contaminate, corrupt, consume, damage, destroy, disrupt, modify, record or transmit; or

(b) Cause to be contaminated, corrupted, consumed, damaged, destroyed, disrupted, modified, recorded or transmitted,

Ê any other data, information, image, program, signal or sound contained in a computer, system or network without the knowledge or consent of the person who owns the other data, information, image, program, signal or sound or the computer, system or network.

2. The term includes, without limitation:

(a) A virus, worm or Trojan horse; [or]

(b) Spyware that tracks computer activity and is capable of recording and transmitting such information to third parties; or

(c) Any other similar data, information, image, program, signal or sound that is designed or has the capability to prevent, impede, delay or disrupt the normal operation or use of any component, device, equipment, system or network.

3. As used in this section:

(a) “On-line bidding” has the meaning ascribed to it in NRS 332.047.

(b) “Spyware” does not include:

(1) An Internet browser;

(2) Software for transmitting messages instantly that informs the user whether other users are on-line at the same time;

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ê2005 Statutes of Nevada, Page 2510 (CHAPTER 486, AB 334)ê

(3) Software that is designed to detect or prevent the use of computer contaminants;

(4) Software that is designed to detect fraudulent on-line bidding;

(5) Software that is designed to prevent children from accessing pornography on the Internet;

(6) Software that conducts remote maintenance or repair of a computer or its systems;

(7) Software that is designed to manage or to perform maintenance on a network of computers;

(8) Software for media players; and

(9) Software that authenticates a user.

Sec. 6. Chapter 603 of NRS is hereby amended by adding thereto a new section to read as follows:

1. Except as otherwise provided in subsections 4 and 6, upon discovery of any breach of the security of his computer system, a person doing business in this State that:

(a) Owns or licenses computerized data that includes personal information shall notify, in the manner set forth in subsection 2, any resident of this State whose personal information contained in that data was, or is reasonably believed to have been, acquired by an unauthorized person.

(b) Maintains computerized data that includes personalized information that the person doing business in this State does not own shall notify, in the manner set forth in subsection 2, the owner or licensee of the data if personal information contained in that data was, or is reasonably believed to have been, acquired by an unauthorized person.

(a) Written notice;

(b) If the notice is consistent with the provisions regarding electronic records and signatures set forth in 15 U.S.C. § 7001, electronic notice; or

(c) Any other method established by the person doing business in this State as part of a policy for the security of his computer system that provides for notification as soon as practicable, but not less than 30 days after the governmental agency knows or should have known of the breach, to the owner or licensee of the data containing the personal information and to persons whose personal information was, or is reasonably believed to have been, acquired by another person.

3. If the person doing business in this State determines that he would have to provide the notice required pursuant to subsection 1 to more than 500,000 persons, the person does not have sufficient contact information to provide the notice by the methods described in subsection 2 or the cost of providing the notice by the methods described in subsection 2 would be more than $250,000, the person doing business in this State may provide the notice required pursuant to subsection 1 by:

(a) If the person doing business in this State has an electronic mail address for the owner or licensee of the information, or the person whose personal information was, or is reasonably believed to have been, acquired by another person, electronic mail;

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ê2005 Statutes of Nevada, Page 2511 (CHAPTER 486, AB 334)ê

(b) If the person doing business in this State maintains an Internet website, posting the notice in a conspicuous place on his Internet website; and

4. If a law enforcement agency determines that the notice required pursuant to subsection 1 may impede a criminal investigation, the person doing business in this State shall delay such notice until the law enforcement agency determines that the notice will not compromise the criminal investigation.

5. In addition to the notification required pursuant to subsection 1, if a person doing business in this State determines that he must provide such notification to more than 1,000 persons as a result of the breach, the person doing business in this State must, without unreasonable delay, inform each consumer reporting agency, as defined in 15 U.S.C. § 1681a(p), in writing, of the timing, distribution and contents of that notification.

6. The provisions of this section do not apply to any person doing business in this State that is subject to the provisions of the Gramm-Leach-Bliley Act, 15 U.S.C. §§ 6801 et. seq., or any regulations adopted pursuant thereto.

7. A person who has suffered injury as the proximate result of a violation of this section may commence an action against the person doing business in this State for the recovery of his actual damages, costs and reasonable attorney’s fees and, if the violation of this section was willful or intentional, for any punitive damages that the facts may warrant. An action described in this subsection must be commenced not later than 2 years after the person who suffered the injury discovers the facts constituting the violation of this section.

8. As used in this section, “personal information” means the name of a person and one or more of the following types of information:

(a) The social security number of the person.

(b) The driver’s license number or identification card number of the person.

(c) The bank account number, credit card number or debit card number of the person in combination with any required security code, access code or password that would allow access to the related account or other personal information of the person.

Sec. 7. NRS 616C.310 is hereby amended to read as follows:

616C.310 1. The Chief of the Hearings Division of the Department of Administration:

(a) May by regulation provide for specific procedures for the determination of contested cases.

(b) Shall develop a format to be used by hearing officers to indicate their findings in contested cases.

(c) Shall adopt regulations to provide for the redaction of personal identifying information of a person filing a claim for compensation from a document relating to the contested case of the person, unless the identity of the person is at issue. As used in this paragraph, “personal identifying information” means any information which would identify a person, including, without limitation, an address, a birth date or a social security number.

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ê2005 Statutes of Nevada, Page 2512 (CHAPTER 486, AB 334)ê

2. An insurer or employer may be represented in a contested case by private legal counsel or by any other agent.

Sec. 8. This act becomes effective on January 1, 2007.

________

CHAPTER 487, AB 555

Assembly Bill No. 555–Assemblyman Mabey

CHAPTER 487

AN ACT relating to medical professionals; requiring a physician licensed to practice medicine or osteopathic medicine to report annually to the appropriate licensing board information concerning certain office-based surgery performed by him; providing that the failure to submit a report or knowingly filing false information in a report constitutes grounds for initiating disciplinary action; requiring the licensing boards of such physicians biennially to compile and report such information to the Governor and the Legislature; making various other changes to the provisions governing certain medical professionals; expanding the medical review committees that may refuse to disclose and to prevent other persons from disclosing certain information from their proceedings; providing that the proceedings and records of those medical review committees are not subject to discovery proceedings; revising the provisions limiting the liability of certain medical providers who render gratuitous care or assistance for certain entities; providing for the imposition of certain civil penalties; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 630 of NRS is hereby amended by adding thereto a new section to read as follows:

1. The Board shall require each holder of a license to practice medicine to submit annually to the Board, on a form provided by the Board, and in the format required by the Board by regulation, a report:

(a) Stating the number and type of surgeries requiring conscious sedation, deep sedation or general anesthesia performed by the holder of the license at his office or any other facility, excluding any surgical care performed:

(1) At a medical facility as that term is defined in NRS 449.0151; or

(2) Outside of this State; and

(b) Reporting the occurrence of any sentinel event arising from any such surgery.

2. Failure to submit a report or knowingly filing false information in a report constitutes grounds for initiating disciplinary action.

3. The Board shall:

(a) Collect and maintain reports received pursuant to subsection 1; and

(b) Ensure that the reports, and any additional documents created from the reports, are protected adequately from fire, theft, loss, destruction and other hazards, and from unauthorized access.

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ê2005 Statutes of Nevada, Page 2513 (CHAPTER 487, AB 555)ê

4. A report received pursuant to subsection 1 is confidential, not subject to subpoena or discovery, and not subject to inspection by the general public.

5. The provisions of this section do not apply to surgical care requiring only the administration of oral medication to a patient to relieve the patient’s anxiety or pain, if the medication is not given in a dosage that is sufficient to induce in a patient a controlled state of depressed consciousness or unconsciousness similar to general anesthesia, deep sedation or conscious sedation.

6. As used in this section:

(a) “Conscious sedation” means a minimally depressed level of consciousness, produced by a pharmacologic or nonpharmacologic method, or a combination thereof, in which the patient retains the ability independently and continuously to maintain an airway and to respond appropriately to physical stimulation and verbal commands.

(b) “Deep sedation” means a controlled state of depressed consciousness, produced by a pharmacologic or nonpharmacologic method, or a combination thereof, and accompanied by a partial loss of protective reflexes and the inability to respond purposefully to verbal commands.

(c) “General anesthesia” means a controlled state of unconsciousness, produced by a pharmacologic or nonpharmacologic method, or a combination thereof, and accompanied by partial or complete loss of protective reflexes and the inability independently to maintain an airway and respond purposefully to physical stimulation or verbal commands.

(d) “Sentinel event” means an unexpected occurrence involving death or serious physical or psychological injury or the risk thereof, including, without limitation, any process variation for which a recurrence would carry a significant chance of serious adverse outcome. The term includes loss of limb or function.

Sec. 2. NRS 630.007 is hereby amended to read as follows:

630.007 “Administrative physician” means a physician who is licensed only to act in an administrative capacity as an:

1. Officer or employee of a state agency; [or]

2. Independent contractor pursuant to a contract with the State [.] ; or

3. Officer, employee or independent contractor of a private insurance company, medical facility or medical care organization, and who does not examine or treat patients in a clinical setting.

Sec. 3. NRS 630.103 is hereby amended to read as follows:

630.103 1. The Board shall employ a person as the Executive [Secretary] Director of the Board.

2. The Executive [Secretary] Director serves as the chief administrative officer of the Board at a level of compensation set by the Board.

3. The Executive [Secretary] Director is an at-will employee who serves at the pleasure of the Board.

Sec. 4. NRS 630.130 is hereby amended to read as follows:

630.130 1. In addition to the other powers and duties provided in this chapter, the Board shall, in the interest of the public, judiciously:

(a) Enforce the provisions of this chapter;

(b) Establish by regulation standards for licensure under this chapter;

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ê2005 Statutes of Nevada, Page 2514 (CHAPTER 487, AB 555)ê

(d) Investigate the character of each applicant for a license and issue licenses to those applicants who meet the qualifications set by this chapter and the Board; and

(e) Institute a proceeding in any court to enforce its orders or the provisions of this chapter.

2. On or before February 15 of each odd-numbered year, the Board shall submit to the Governor and to the Director of the Legislative Counsel Bureau for transmittal to the next regular session of the Legislature a written report compiling:

(a) Disciplinary action taken by the Board during the previous biennium against physicians for malpractice or negligence; and

(b) Information reported to the Board during the previous biennium pursuant to NRS 630.3067, 630.3068, subsections 2 and 3 of NRS 630.307 and NRS 690B.250 and 690B.260 [.] and section 1 of this act.

Ê The report must include only aggregate information for statistical purposes and exclude any identifying information related to a particular person.

3. The Board may adopt such regulations as are necessary or desirable to enable it to carry out the provisions of this chapter.

Sec. 5. NRS 630.254 is hereby amended to read as follows:

630.254 1. Each licensee shall maintain a permanent mailing address with the Board to which all communications from the Board to the licensee must be sent. A licensee who changes his permanent mailing address shall notify the Board of his new permanent mailing address within 30 days after the change. If a licensee fails to notify the Board of a change in his permanent mailing address within 30 days after the change, the Board:

(a) Shall impose upon the licensee a fine not to exceed $100; and

(b) May initiate disciplinary action against the licensee as provided pursuant to subsection 9 of NRS 630.306.

2. Any licensee who changes the location of his office in this State shall notify the Board of the change before practicing at the new location.

[2.] 3. Any licensee who closes his office in this State shall:

(a) Notify the Board of this occurrence within 14 days after the closure; and

(b) For a period of 5 years thereafter keep the Board apprised of the location of the medical records of his patients.

Sec. 6. NRS 630.255 is hereby amended to read as follows:

630.255 1. Any licensee who changes the location of his practice of medicine from this State to another state or country, has never engaged in the practice of medicine in this State after licensure or has ceased to engage in the practice of medicine in this State for 12 consecutive months may be placed on inactive status by order of the Board.

2. Each inactive registrant shall maintain a permanent mailing address with the Board to which all communications from the Board to the registrant must be sent. An inactive registrant who changes his permanent mailing address shall notify the Board of his new permanent mailing address within 30 days after the change. If an inactive registrant fails to notify the Board of a change in his permanent mailing address within 30 days after the change, the Board shall impose upon the registrant a fine not to exceed $100.

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ê2005 Statutes of Nevada, Page 2515 (CHAPTER 487, AB 555)ê

3. Before resuming the practice of medicine in this State, the inactive registrant must:

(a) Notify the Board of his intent to resume the practice of medicine in this State;

(b) File an affidavit with the Board describing his activities during the period of his inactive status;

(d) Pay the applicable fee for biennial registration; and

(e) Satisfy the Board of his competence to practice medicine.

[3.] 4. If the Board determines that the conduct or competence of the registrant during the period of inactive status would have warranted denial of an application for a license to practice medicine in this State, the Board may refuse to place the registrant on active status.

Sec. 7. NRS 630.259 is hereby amended to read as follows:

630.259 1. A person may apply to the Board to be licensed as an administrative physician if the person meets all of the statutory requirements for licensure in effect at the time of application except the requirements of paragraph (d) of subsection 2 of NRS 630.160.

2. A person who is licensed as an administrative physician pursuant to this section:

(a) May not engage in the practice of clinical medicine;

(b) Shall comply with all of the statutory requirements for continued licensure pursuant to this chapter; and

Sec. 8. NRS 630.299 is hereby amended to read as follows:

630.299 1. If the Board has reason to believe that a person has violated, is violating or is about to violate any provision of this chapter, the Board or any investigative committee of the Board may issue to the person a letter of warning, a letter of concern or a nonpunitive admonishment at any time before the Board has initiated any disciplinary proceedings against the person.

2. The issuance of such a letter or admonishment:

(a) Does not preclude the Board from initiating any disciplinary proceedings against the person or taking any disciplinary action against the person based on any conduct alleged or described in the letter or admonishment or any other conduct; and

(b) Does not constitute a final decision of the Board and is not subject to judicial review.

Sec. 9. Chapter 633 of NRS is hereby amended by adding thereto a new section to read as follows:

1. The Board shall require each holder of a license issued pursuant to this chapter to submit annually to the Board, on a form provided by the Board, and in the format required by the Board by regulation, a report:

(1) At a medical facility as that term is defined in NRS 449.0151; or

(2) Outside of this State; and

(b) Reporting the occurrence of any sentinel event arising from any such surgery.

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ê2005 Statutes of Nevada, Page 2516 (CHAPTER 487, AB 555)ê

2. Failure to submit a report or knowingly filing false information in a report constitutes grounds for initiating disciplinary action.

3. The Board shall:

(a) Collect and maintain reports received pursuant to subsection 1; and

(b) Ensure that the reports, and any additional documents created from the reports, are protected adequately from fire, theft, loss, destruction and other hazards, and from unauthorized access.

4. A report received pursuant to subsection 1 is confidential, not subject to subpoena or discovery, and not subject to inspection by the general public.

6. As used in this section:

Sec. 10. NRS 633.286 is hereby amended to read as follows:

633.286 1. On or before February 15 of each odd-numbered year, the Board shall submit to the Governor and to the Director of the Legislative Counsel Bureau for transmittal to the next regular session of the Legislature a written report compiling:

(a) Disciplinary action taken by the Board during the previous biennium against osteopathic physicians for malpractice or negligence; and

(b) Information reported to the Board during the previous biennium pursuant to NRS 633.526, 633.527, subsections 2 and 3 of NRS 633.533 and NRS 690B.250 and 690B.260 [.] and section 9 of this act.

2. The report must include only aggregate information for statistical purposes and exclude any identifying information related to a particular person.

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ê2005 Statutes of Nevada, Page 2517 (CHAPTER 487, AB 555)ê

Sec. 11. NRS 652.210 is hereby amended to read as follows:

652.210 No person other than a licensed physician, a licensed optometrist, a licensed practical nurse, a registered nurse, a licensed physician assistant, a certified osteopathic physician’s assistant, a certified intermediate emergency medical technician, a certified advanced emergency medical technician , a practitioner of respiratory care licensed pursuant to chapter 630 of NRS or a licensed dentist may manipulate a person for the collection of specimens, except that technical personnel of a laboratory may collect blood, remove stomach contents, perform certain diagnostic skin tests or field blood tests or collect material for smears and cultures.

Sec. 12. NRS 41.505 is hereby amended to read as follows:

41.505 1. Any physician or registered nurse who in good faith gives instruction or provides supervision to an emergency medical attendant or registered nurse, at the scene of an emergency or while transporting an ill or injured person from the scene of an emergency, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, in giving that instruction or providing that supervision. An emergency medical attendant, registered nurse or licensed practical nurse who obeys an instruction given by a physician, registered nurse or licensed practical nurse and thereby renders emergency care, at the scene of an emergency or while transporting an ill or injured person from the scene of an emergency, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, in rendering that emergency care.

2. Except as otherwise provided in subsection 3, any person licensed under the provisions of chapter 630, 632 or 633 of NRS and any person who holds an equivalent license issued by another state, who renders emergency care or assistance in an emergency, gratuitously and in good faith, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by him in rendering the emergency care or assistance or as a result of any failure to act, not amounting to gross negligence, to provide or arrange for further medical treatment for the injured or ill person. This section does not excuse a physician or nurse from liability for damages resulting from his acts or omissions which occur in a licensed medical facility relative to any person with whom there is a preexisting relationship as a patient.

3. Any person licensed under the provisions of chapter 630, 632 or 633 of NRS and any person who holds an equivalent license issued by another state who renders emergency obstetrical care or assistance to a pregnant woman during labor or the delivery of the child is not liable for any civil damages as a result of any act or omission by him in rendering that care or assistance if:

(a) The care or assistance is rendered in good faith and in a manner not amounting to gross negligence or reckless, willful or wanton conduct;

(b) The person has not previously provided prenatal or obstetrical care to the woman; and

Ê A licensed medical facility in which such care or assistance is rendered is not liable for any civil damages as a result of any act or omission by the person in rendering that care or assistance if that person is not liable for any civil damages pursuant to this subsection and the actions of the medical facility relating to the rendering of that care or assistance do not amount to gross negligence or reckless, willful or wanton conduct.

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ê2005 Statutes of Nevada, Page 2518 (CHAPTER 487, AB 555)ê

facility relating to the rendering of that care or assistance do not amount to gross negligence or reckless, willful or wanton conduct.

4. Any person licensed under the provisions of chapter 630, 632 or 633 of NRS and any person who holds an equivalent license issued by another state who:

(a) Is retired or otherwise does not practice on a full-time basis; and

(b) Gratuitously and in good faith, renders medical care within the scope of his license to an indigent person,

Ê is not liable for any civil damages as a result of any act or omission by him, not amounting to gross negligence or reckless, willful or wanton conduct, in rendering that care.

5. Any person licensed to practice medicine under the provisions of chapter 630 or 633 of NRS or licensed to practice dentistry under the provisions of chapter 631 of NRS who renders care or assistance to a patient [at a health care facility of] for a governmental entity or a nonprofit organization is not liable for any civil damages as a result of any act or omission by him in rendering that care or assistance if the care or assistance is rendered gratuitously, in good faith and in a manner not amounting to gross negligence or reckless, willful or wanton conduct.

6. As used in this section:

(a) “Emergency medical attendant” means a person licensed as an attendant or certified as an emergency medical technician, intermediate emergency medical technician or advanced emergency medical technician pursuant to chapter 450B of NRS.

(b) “Gratuitously” has the meaning ascribed to it in NRS 41.500.

[(c) “Health care facility” has the meaning ascribed to it in NRS 449.800.]

Sec. 13. NRS 49.117 is hereby amended to read as follows:

49.117 As used in NRS 49.117 to 49.123, inclusive, unless the context otherwise requires, “review committee” means:

1. An organized committee of:

(a) A hospital;

(b) An ambulatory surgical center;

(d) An organization that provides emergency medical services pursuant to the provisions of chapter 450B of NRS; or

(e) A medical facility as defined in NRS 449.0151,

Ê which has the responsibility of evaluating and improving the quality of care rendered by the parent organization; [or]

2. A peer review committee of a medical or dental society [.] ; or

3. A medical review committee of a county or district board of health that certifies, licenses or regulates providers of emergency medical services pursuant to the provisions of chapter 450B of NRS, but only when functioning as a peer review committee.

Sec. 14. NRS 49.265 is hereby amended to read as follows:

49.265 1. Except as otherwise provided in subsection 2:

(a) The proceedings and records of:

(1) Organized committees of hospitals, and organized committees of organizations that provide emergency medical services pursuant to the provisions of chapter 450B of NRS, having the responsibility of evaluation and improvement of the quality of care rendered by those hospitals or organizations; [and]

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ê2005 Statutes of Nevada, Page 2519 (CHAPTER 487, AB 555)ê

(2) Review committees of medical or dental societies [,] ; and

(3) Medical review committees of a county or district board of health that certifies, licenses or regulates providers of emergency medical services pursuant to the provisions of chapter 450B of NRS, but only when such committees function as peer review committees,

Ê are not subject to discovery proceedings.

(b) No person who attends a meeting of any such committee may be required to testify concerning the proceedings at the meeting.

2. The provisions of subsection 1 do not apply to:

(a) Any statement made by a person in attendance at such a meeting who is a party to an action or proceeding the subject of which is reviewed at the meeting.

(b) Any statement made by a person who is requesting staff privileges at a hospital.

(c) The proceedings of any meeting considering an action against an insurance carrier alleging bad faith by the carrier in refusing to accept a settlement offer within the limits of the policy.

(d) Any matter relating to the proceedings or records of such committees which is contained in health care records furnished in accordance with NRS 629.061.

Sec. 15. NRS 440.415 is hereby amended to read as follows:

440.415 1. A physician who anticipates the death of a patient because of an illness, infirmity or disease may authorize a specific registered nurse or physician assistant or the registered nurses or physician assistants employed by a medical facility or program for hospice care to make a pronouncement of death if they attend the death of the patient.

2. Such an authorization is valid for 120 days. Except as otherwise provided in subsection 3, the authorization must:

(a) Be a written order entered on the chart of the patient;

(b) State the name of the registered nurse or nurses or physician assistant or assistants authorized to make the pronouncement of death; and

3. If the patient is in a medical facility or under the care of a program for hospice care, the physician may authorize the registered nurses or physician assistants employed by the facility or program to make pronouncements of death without specifying the name of each nurse [.] or assistant, as applicable.

4. If a pronouncement of death is made by a registered nurse [,] or physician assistant, the physician who authorized that action shall sign the medical certificate of death within 24 hours after being presented with the certificate.

5. If a patient in a medical facility is pronounced dead by a registered nurse or physician assistant employed by the facility, the registered nurse or physician assistant may release the body of the patient to a licensed funeral director pending the completion of the medical certificate of death by the attending physician if the physician or the medical director or chief of the medical staff of the facility has authorized the release in writing.

6. The Board may adopt regulations concerning the authorization of a registered nurse or physician assistant to make pronouncements of death.

7. As used in this section:

(a) “Medical facility” means:

(1) A facility for skilled nursing as defined in NRS 449.0039;

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ê2005 Statutes of Nevada, Page 2520 (CHAPTER 487, AB 555)ê

(2) A facility for hospice care as defined in NRS 449.0033;

(3) A hospital as defined in NRS 449.012;

(4) An agency to provide nursing in the home as defined in NRS 449.0015; or

(5) A facility for intermediate care as defined in NRS 449.0038.

(b) “Physician assistant” means a person who holds a license as a physician assistant pursuant to chapter 630 of NRS or a certificate as an osteopathic physician’s assistant pursuant to chapter 633 of NRS.

[(c)] (d) “Pronouncement of death” means a declaration of the time and date when the cessation of the cardiovascular and respiratory functions of a patient occurs as recorded in the patient’s medical record by the attending provider of health care in accordance with the provisions of chapter 440 of NRS.

Sec. 16. 1. This section becomes effective upon passage and approval.

2. Sections 2, 3, 5 to 8, inclusive, 11 and 15 of this act become effective on July 1, 2005.

3. Sections 1, 4, 9, 10, 12, 13 and 14 of this act become effective on October 1, 2005.

________

CHAPTER 488, AB 44

Assembly Bill No. 44–Committee on Government Affairs

CHAPTER 488

AN ACT relating to employment practices; making employees who earn one and one-half times minimum wage or more per hour subject to the jurisdiction of the Labor Commissioner for disputes regarding overtime; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 608.018 is hereby amended to read as follows:

608.018 1. [Except as otherwise provided in this section, an] An employer shall pay one and one-half times an employee’s regular wage rate whenever an employee who receives compensation for employment at a rate less than one and one-half times the minimum rate prescribed pursuant to NRS 608.250 works:

(a) More than 40 hours in any scheduled week of work; or

(b) More than 8 hours in any workday unless by mutual agreement the employee works a scheduled 10 hours per day for 4 calendar days within any scheduled week of work.

2. An employer shall pay one and one-half times an employee’s regular wage rate whenever an employee who receives compensation for employment at a rate not less than one and one-half times the minimum rate prescribed pursuant to NRS 608.250 works more than 40 hours in any scheduled week of work.

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ê2005 Statutes of Nevada, Page 2521 (CHAPTER 488, AB 44)ê

3. The provisions of [subsection] subsections 1 and 2 do not apply to:

(a) Employees who are not covered by the minimum wage provisions of NRS 608.250;

(b) [Employees who receive compensation for employment at a rate not less than one and one-half times the minimum rate prescribed pursuant to NRS 608.250;

(c)] Outside buyers;

[(d)] (c) Salesmen earning commissions in a retail business if their regular rate is more than one and one-half times the minimum wage, and more than one-half their compensation comes from commissions;

[(e)] (d) Employees who are employed in bona fide executive, administrative or professional capacities;

[(f)] (e) Employees covered by collective bargaining agreements which provide otherwise for overtime;

[(g)] (f) Drivers, drivers’ helpers, loaders and mechanics for motor carriers subject to the Motor Carrier Act of 1935, as amended;

[(h)] (g) Employees of a railroad;

[(i)] (h) Employees of a carrier by air;

[(j)] (i) Drivers or drivers’ helpers making local deliveries and paid on a trip-rate basis or other delivery payment plan;

[(k)] (j) Drivers of taxicabs or limousines;

[(l)] (k) Agricultural employees;

[(m)] (l) Employees of business enterprises having a gross sales volume of less than $250,000 per year; and

[(n)] (m) Any salesman or mechanic primarily engaged in selling or servicing automobiles, trucks or farm equipment.

[3. The provisions of this section do not apply to a]

(n) A mechanic or workman for any hours to which the provisions of subsection 3 or 4 of NRS 338.020 apply.

Sec. 2. This act becomes effective on July 1, 2005.

________

CHAPTER 489, AB 208

Assembly Bill No. 208–Assemblymen Horne, Conklin, Allen, Arberry Jr., Atkinson, Christensen, Denis, Gansert, Gerhardt, Giunchigliani, Grady, Hardy, Hettrick, Kirkpatrick, Koivisto, Leslie, Mabey, Manendo, Marvel, McClain, McCleary, Mortenson, Munford, Oceguera, Parks, Parnell, Pierce, Sherer, Sibley, Smith and Weber

Joint Sponsors: Senators Care, Horsford and Titus

CHAPTER 489

AN ACT relating to medical professions; requiring an applicant for a license to practice medicine to submit to a criminal background check; requiring physicians and osteopathic physicians against whom disciplinary action is initiated to submit to criminal background checks; expanding the grounds for initiating disciplinary action against physicians and osteopathic physicians; requiring, upon request, an agency of criminal justice to disseminate records of criminal history to the Board of Medical Examiners and the State Board of Osteopathic Medicine; creating the Nevada Institutional Review Board and defining its powers and duties; requiring the Board of Homeopathic Medical Examiners to make recommendations to the Legislature regarding alternative and complementary integrative medicine; and providing other matters properly relating thereto.

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ê2005 Statutes of Nevada, Page 2522 (CHAPTER 489, AB 208)ê

Board of Homeopathic Medical Examiners to make recommendations to the Legislature regarding alternative and complementary integrative medicine; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 630 of NRS is hereby amended by adding thereto the provisions set forth as sections 2 and 3 of this act.

Sec. 2. In addition to any other requirements set forth in this chapter, each applicant for a license to practice medicine shall submit to the Board a complete set of his fingerprints and written permission authorizing the Board to forward the fingerprints to the Central Repository for Nevada Records of Criminal History for submission to the Federal Bureau of Investigation for its report.

Sec. 3. 1. Any physician against whom the Board initiates disciplinary action pursuant to this chapter shall, within 30 days after the physician’s receipt of notification of the initiation of the disciplinary action, submit to the Board a complete set of his fingerprints and written permission authorizing the Board to forward the fingerprints to the Central Repository for Nevada Records of Criminal History for submission to the Federal Bureau of Investigation for its report.

2. The willful failure of a physician to comply with the requirements of subsection 1 constitutes additional grounds for disciplinary action and the revocation of the license of the physician.

3. The Board has additional grounds for initiating disciplinary action against a physician if the report from the Federal Bureau of Investigation indicates that the physician has been convicted of:

(a) An act that is a ground for disciplinary action pursuant to NRS 630.301 to 630.3066, inclusive; or

(b) A violation of NRS 630.400.

Sec. 4. NRS 630.301 is hereby amended to read as follows:

630.301 The following acts, among others, constitute grounds for initiating disciplinary action or denying licensure:

1. Conviction of a felony relating to the practice of medicine or the ability to practice medicine. A plea of nolo contendere is a conviction for the purposes of this subsection.

2. Conviction of violating any of the provisions of NRS 616D.200, 616D.220, 616D.240, 616D.300, 616D.310, or 616D.350 to 616D.440, inclusive.

3. The revocation, suspension, modification or limitation of the license to practice any type of medicine by any other jurisdiction or the surrender of the license or discontinuing the practice of medicine while under investigation by any licensing authority, a medical facility, a branch of the Armed Services of the United States, an insurance company, an agency of the Federal Government or an employer.

4. Malpractice, which may be evidenced by claims settled against a practitioner, but only if such malpractice is established by a preponderance of the evidence.

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ê2005 Statutes of Nevada, Page 2523 (CHAPTER 489, AB 208)ê

5. The engaging by a practitioner in any sexual activity with a patient who is currently being treated by the practitioner.

6. Disruptive behavior with physicians, hospital personnel, patients, members of the families of patients or any other persons if the behavior interferes with patient care or has an adverse impact on the quality of care rendered to a patient.

7. The engaging in conduct that violates the trust of a patient and exploits the relationship between the physician and the patient for financial or other personal gain.

8. The failure to offer appropriate procedures or studies, to protest inappropriate denials by organizations for managed care, to provide necessary services or to refer a patient to an appropriate provider, when such a failure occurs with the intent of positively influencing the financial well-being of the practitioner or an insurer.

9. The engaging in conduct that brings the medical profession into disrepute, including, without limitation, conduct that violates any provision of a [national] code of ethics adopted by the Board by regulation [.] based on a national code of ethics.

10. The engaging in sexual contact with the surrogate of a patient or other key persons related to a patient, including, without limitation, a spouse, parent or legal guardian, which exploits the relationship between the physician and the patient in a sexual manner.

11. Conviction of:

(a) Murder, voluntary manslaughter or mayhem;

(b) Any felony involving the use of a firearm or other deadly weapon;

(d) Sexual assault, statutory sexual seduction, incest, lewdness, indecent exposure or any other sexually related crime;

(e) Abuse or neglect of a child or contributory delinquency;

(f) A violation of any federal or state law regulating the possession, distribution or use of any controlled substance or any dangerous drug as defined in chapter 454 of NRS; or

(g) Any offense involving moral turpitude.

Sec. 5. Chapter 630A of NRS is hereby amended by adding thereto the provisions set forth as sections 5.2 to 10, inclusive, of this act.

Sec. 5.2. As used in sections 5.2 to 10, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 5.4, 5.5 and 5.6 of this act have the meanings ascribed to them in those sections.

Sec. 5.4. “Practitioner” means:

1. A homeopathic physician licensed pursuant to this chapter;

2. A physician licensed pursuant to chapter 630 of NRS; or

3. An osteopathic physician licensed pursuant to chapter 633 of NRS.

Sec. 5.5. 1. “Researcher” means a practitioner who intends to undertake or is undertaking a research study.

2. The term does not include a practitioner who intends to undertake or is undertaking any research, study or trial described in section 5.8 of this act.

Sec. 5.6. 1. “Research study” means any research, study or trial using devices, therapies or substances regulated by the Board of Homeopathic Medical Examiners, or any combination of those devices, therapies or substances, in a manner that is considered to be a form of alternative or complementary integrative medicine.

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ê2005 Statutes of Nevada, Page 2524 (CHAPTER 489, AB 208)ê

therapies or substances, in a manner that is considered to be a form of alternative or complementary integrative medicine.

2. The term does not include any research, study or trial described in section 5.8 of this act.

Sec. 5.8. The provisions of sections 5.2 to 10, inclusive, of this act do not apply to any research, study or trial that is conducted under the auspices of a federally qualified institutional review board and in accordance with applicable federal statutes.

Sec. 6. 1. The Nevada Institutional Review Board is hereby created.

2. The Nevada Institutional Review Board shall be under the supervision of the Board of Homeopathic Medical Examiners.

3. The Nevada Institutional Review Board consists of seven members appointed as follows:

(a) After consultation with organizations in Nevada representing medical disciplines, the Board of Homeopathic Medical Examiners shall appoint four members who represent various medical disciplines in Nevada.

(b) Three members who are lay members of the general public and residents of Nevada and who are not licensed in any medical discipline must be appointed as follows:

(1) One member appointed by the Governor;

(2) One member appointed by the Majority Leader of the Senate; and

(3) One member appointed by the Speaker of the Assembly.

4. The members of the Nevada Institutional Review Board serve at the pleasure of the appointing authority. A vacancy on the Nevada Institutional Review Board must be filled by the appointing authority in the same manner as the original appointment.

5. The members of the Nevada Institutional Review Board are entitled to receive, out of the money coming into the possession of the Nevada Institutional Review Board, a per diem allowance and travel expenses, as fixed by the Nevada Institutional Review Board.

6. Four members of the Nevada Institutional Review Board constitute a quorum. A quorum may exercise all the power and authority conferred on the Nevada Institutional Review Board.

7. The Nevada Institutional Review Board shall elect officers from within its membership, fix the time and place of its meetings and adopt rules of procedure as it deems necessary to carry out its duties.

Sec. 7. Before entering upon the duties of his office, each member of the Nevada Institutional Review Board shall take:

1. The constitutional oath or affirmation of office; and

2. An oath or affirmation that he is legally qualified to serve on the Nevada Institutional Review Board.

Sec. 7.3. 1. The Nevada Institutional Review Board shall adopt regulations to carry out the provisions of sections 5.2 to 10, inclusive, of this act.

2. All regulations adopted by the Nevada Institutional Review Board must be approved by the Board of Homeopathic Medical Examiners.

Sec. 7.7. 1. A researcher who intends to undertake a research study must submit a proposal for the research study to the Nevada Institutional Review Board for its review and approval.

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ê2005 Statutes of Nevada, Page 2525 (CHAPTER 489, AB 208)ê

2. A researcher shall not undertake a research study unless the proposal for the research study has been approved by the Nevada Institutional Review Board.

Sec. 8. 1. The Nevada Institutional Review Board shall:

(a) Review proposals for research studies and oversee, review and control all research studies it has approved;

(b) Evaluate, determine and act upon the safety, efficacy, reimbursement and availability of diagnostic devices, substances, other modalities, therapies and methods of treatment used in such research studies; and

(c) Analyze, coordinate and integrate the diagnostic techniques and treatments related to alternative and complementary integrative medicine with the diagnostic techniques and treatments of other health care practices.

2. The Nevada Institutional Review Board shall oversee, review and control any research studies which it has approved and which involve the use of human research subjects and any related issues, including, without limitation:

(a) The qualifications required for conducting such research studies;

(b) The proper clinical outcome to be attributed to such research studies; and

(c) The safety, efficacy, reimbursement and availability of diagnostic devices, substances, other modalities, therapies and methods of treatment used in such research studies.

3. The Nevada Institutional Review Board shall evaluate:

(a) The social and economic impact of the research studies it has approved; and

(b) The relationship between alternative and complementary integrative medicine and other health care practices.

4. The Nevada Institutional Review Board shall:

(a) Keep a record of all transactions and provide the Board of Homeopathic Medical Examiners, the Board of Medical Examiners and the State Board of Osteopathic Medicine with quarterly reports of all transactions; and

(b) Make any additional reports or recommendations to the Board of Homeopathic Medical Examiners as the Board of Homeopathic Medical Examiners requires.

5. The Nevada Institutional Review Board is accountable to the Board of Homeopathic Medical Examiners for all the activities of the Nevada Institutional Review Board.

Sec. 9. 1. All money received by the Nevada Institutional Review Board must be deposited in financial institutions in this State that are federally insured or insured by a private insurer approved pursuant to NRS 678.755. The money must be kept separate from any money to be used by or for the Board of Homeopathic Medical Examiners.

2. The deposited money must only be used to carry out the activities of the Nevada Institutional Review Board and to pay the expenses incurred by the Nevada Institutional Review Board in the discharge of its duties.

Sec. 10. 1. Except as otherwise provided in subsection 3, the Nevada Institutional Review Board may be funded by:

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ê2005 Statutes of Nevada, Page 2526 (CHAPTER 489, AB 208)ê

(a) A nonprofit organization, created by the Board of Homeopathic Medical Examiners, which is exempt from taxation pursuant to 26 U.S.C. § 501(c)(3); and

(b) Grants, gifts, appropriations or donations to assist the Nevada Institutional Review Board in carrying out its duties pursuant to the provisions of sections 5.2 to 10, inclusive, of this act.

2. Any money received by the Nevada Institutional Review Board must be placed with the financial institutions described in section 9 of this act.

3. The Nevada Institutional Review Board may not be funded by any money from:

(a) The sponsor of any research study; or

(b) The manufacturer of any device, drug or other substance regulated by the Board of Homeopathic Medical Examiners.

Sec. 11. NRS 630A.090 is hereby amended to read as follows:

630A.090 1. [This] Except as otherwise provided in sections 5.2 to 10, inclusive, of this act, this chapter does not apply to:

(a) The practice of dentistry, chiropractic, Oriental medicine, podiatry, optometry, respiratory care, faith or Christian Science healing, nursing, veterinary medicine or fitting hearing aids.

(b) A medical officer of the Armed Services or a medical officer of any division or department of the United States in the discharge of his official duties.

(d) Homeopathic physicians who are called into this State, other than on a regular basis, for consultation or assistance to any physician licensed in this State, and who are legally qualified to practice in the state or country where they reside.

2. This chapter does not repeal or affect any statute of Nevada regulating or affecting any other healing art.

3. This chapter does not prohibit:

(a) Gratuitous services of a person in case of emergency.

(b) The domestic administration of family remedies.

4. This chapter does not authorize a homeopathic physician to practice medicine, including allopathic medicine, except as otherwise provided in NRS 630A.040.

Sec. 12. NRS 630A.155 is hereby amended to read as follows:

630A.155 The Board shall:

1. Regulate the practice of homeopathic medicine in this State and any activities that are within the scope of such practice, to protect the public health and safety and the general welfare of the people of this State.

2. Determine the qualifications of, and examine, applicants for licensure or certification pursuant to this chapter, and specify by regulation the methods to be used to check the background of such applicants.

3. License or certify those applicants it finds to be qualified.

4. Investigate, hear and decide all complaints made against any homeopathic physician, advanced practitioner of homeopathy, homeopathic assistant or any agent or employee of any of them, or any facility where the primary practice is homeopathic medicine. If a complaint concerns a practice which is within the jurisdiction of another licensing board [, including, without limitation, spinal manipulation, surgery, nursing or allopathic medicine,] or any other possible violation of state law, the Board shall refer the complaint to the other licensing board.

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ê2005 Statutes of Nevada, Page 2527 (CHAPTER 489, AB 208)ê

medicine,] or any other possible violation of state law, the Board shall refer the complaint to the other licensing board.

5. Supervise the Nevada Institutional Review Board created by section 6 of this act, including, without limitation, approving or denying the regulations adopted by the Nevada Institutional Review Board.

6. Submit an annual report to the Legislature and make recommendations to the Legislature concerning the enactment of legislation relating to alternative and complementary integrative medicine, including, without limitation, homeopathic medicine.

Sec. 13. Chapter 633 of NRS is hereby amended by adding thereto a new section to read as follows:

1. Any osteopathic physician against whom the Board initiates disciplinary action pursuant to this chapter shall, within 30 days after the osteopathic physician’s receipt of notification of the initiation of the disciplinary action, submit to the Board a complete set of his fingerprints and written permission authorizing the Board to forward the fingerprints to the Central Repository for Nevada Records of Criminal History for submission to the Federal Bureau of Investigation for its report.

2. The willful failure of an osteopathic physician to comply with the requirements of subsection 1 constitutes additional grounds for disciplinary action and the revocation of the license of the osteopathic physician.

3. The Board has additional grounds for initiating disciplinary action against an osteopathic physician if the report from the Federal Bureau of Investigation indicates that the osteopathic physician has been convicted of:

(a) An act that is a ground for disciplinary action pursuant to NRS 633.511; or

(b) A felony set forth in NRS 633.741.

Sec. 14. NRS 633.328 is hereby amended to read as follows:

633.328 [1.] In addition to any other requirements set forth in this chapter, each applicant for a license to practice osteopathic medicine, except a temporary or special license, or each osteopathic physician’s assistant for whom an application to employ an osteopathic physician’s assistant is submitted to the Board must submit to the Board a complete set of his fingerprints and written permission authorizing the Board to forward the fingerprints to the Central Repository for Nevada Records of Criminal History for submission to the Federal Bureau of Investigation for its report.

[2. The Board may issue a provisional license pending receipt of the report of the Federal Bureau of Investigation if the Board determines that the applicant is otherwise qualified.

3. The Board shall revoke a provisional license upon receipt of the report from the Federal Bureau of Investigation if the report indicates that:

(a) The applicant or the osteopathic physician’s assistant has been convicted of an act that is a ground for disciplinary action pursuant to NRS 633.511;

(b) The applicant or the osteopathic physician’s assistant has been convicted of a felony set forth in NRS 633.741; or

(c) A warrant for the arrest of the applicant or the osteopathic physician’s assistant has been issued by a court of competent jurisdiction.]

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ê2005 Statutes of Nevada, Page 2528 (CHAPTER 489, AB 208)ê

Sec. 15. NRS 633.511 is hereby amended to read as follows:

633.511 The grounds for initiating disciplinary action pursuant to this chapter are:

1. Unprofessional conduct.

2. Conviction of:

(a) A violation of any federal or state law regulating the possession, distribution or use of any controlled substance or any dangerous drug as defined in chapter 454 of NRS;

(b) A felony relating to the practice of osteopathic medicine;

(d) Murder, voluntary manslaughter or mayhem;

(e) Any felony involving the use of a firearm or other deadly weapon;

(f) Assault with intent to kill or to commit sexual assault or mayhem;

(g) Sexual assault, statutory sexual seduction, incest, lewdness, indecent exposure or any other sexually related crime;

(h) Abuse or neglect of a child or contributory delinquency; or

(i) Any offense involving moral turpitude.

3. The suspension of the license to practice osteopathic medicine by any other jurisdiction.

4. Gross or repeated malpractice, which may be evidenced by claims of malpractice settled against a practitioner.

5. Professional incompetence.

6. Failure to comply with the requirements of NRS 633.527.

Sec. 16. NRS 179A.100 is hereby amended to read as follows:

179A.100 1. The following records of criminal history may be disseminated by an agency of criminal justice without any restriction pursuant to this chapter:

(a) Any which reflect records of conviction only; and

(b) Any which pertain to an incident for which a person is currently within the system of criminal justice, including parole or probation.

2. Without any restriction pursuant to this chapter, a record of criminal history or the absence of such a record may be:

(a) Disclosed among agencies which maintain a system for the mutual exchange of criminal records.

(b) Furnished by one agency to another to administer the system of criminal justice, including the furnishing of information by a police department to a district attorney.

3. An agency of criminal justice shall disseminate to a prospective employer, upon request, records of criminal history concerning a prospective employee or volunteer which:

(a) Reflect convictions only; or

(b) Pertain to an incident for which the prospective employee or volunteer is currently within the system of criminal justice, including parole or probation.

4. In addition to any other information to which an employer is entitled or authorized to receive, the Central Repository shall disseminate to a prospective or current employer the information described in subsection 4 of NRS 179A.190 concerning an employee, prospective employee, volunteer or prospective volunteer who gives his written consent to the release of that information if the employer submits a request in the manner set forth in NRS 179A.200 for obtaining a notice of information.

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ê2005 Statutes of Nevada, Page 2529 (CHAPTER 489, AB 208)ê

179A.200 for obtaining a notice of information. The Central Repository shall search for and disseminate such information in the manner set forth in NRS 179A.210 for the dissemination of a notice of information. Except as otherwise provided in this subsection, the provisions of NRS 179A.180 to 179A.240, inclusive, do not apply to an employer who requests information and to whom information is disseminated pursuant to this subsection.

5. Records of criminal history must be disseminated by an agency of criminal justice , upon request, to the following persons or governmental entities:

(a) The person who is the subject of the record of criminal history for the purposes of NRS 179A.150.

(b) The person who is the subject of the record of criminal history or his attorney of record when the subject is a party in a judicial, administrative, licensing, disciplinary or other proceeding to which the information is relevant.

(d) The State Board of Nursing.

(e) The Private Investigator’s Licensing Board to investigate an applicant for a license.

(f) A public administrator to carry out his duties as prescribed in chapter 253 of NRS.

(g) A public guardian to investigate a ward or proposed ward or persons who may have knowledge of assets belonging to a ward or proposed ward.

(h) Any agency of criminal justice of the United States or of another state or the District of Columbia.

(i) Any public utility subject to the jurisdiction of the Public Utilities Commission of Nevada when the information is necessary to conduct a security investigation of an employee or prospective employee, or to protect the public health, safety or welfare.

(j) Persons and agencies authorized by statute, ordinance, executive order, court rule, court decision or court order as construed by appropriate state or local officers or agencies.

(k) Any person or governmental entity which has entered into a contract to provide services to an agency of criminal justice relating to the administration of criminal justice, if authorized by the contract, and if the contract also specifies that the information will be used only for stated purposes and that it will be otherwise confidential in accordance with state and federal law and regulation.

(l) Any reporter for the electronic or printed media in his professional capacity for communication to the public.

(m) Prospective employers if the person who is the subject of the information has given written consent to the release of that information by the agency which maintains it.

(n) For the express purpose of research, evaluative or statistical programs pursuant to an agreement with an agency of criminal justice.

(o) An agency which provides child welfare services, as defined in NRS 432B.030.

(p) The Welfare Division of the Department of Human Resources or its designated representative.

(q) An agency of this or any other state or the Federal Government that is conducting activities pursuant to Part D of Subchapter IV of Chapter 7 of Title 42 of the Social Security Act, 42 U.S.C. §§ 651 et seq.

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ê2005 Statutes of Nevada, Page 2530 (CHAPTER 489, AB 208)ê

(r) The State Disaster Identification Team of the Division of Emergency Management of the Department.

(s) The Commissioner of Insurance.

(t) The Board of Medical Examiners.

(u) The State Board of Osteopathic Medicine.

6. Agencies of criminal justice in this State which receive information from sources outside this State concerning transactions involving criminal justice which occur outside Nevada shall treat the information as confidentially as is required by the provisions of this chapter.

Sec. 17. 1. As soon as practicable, each appointing authority responsible for the appointment of members to the Nevada Institutional Review Board shall make its initial appointments to the Nevada Institutional Review Board.

2. The Nevada Institutional Review Board shall adopt regulations pursuant to section 7.3 of this act on or before October 1, 2005.

Sec. 18. 1. This section and section 17 of this act become effective upon passage and approval.

2. Sections 1 to 16, inclusive, of this act become effective on July 1, 2005.

________

CHAPTER 490, AB 180

Assembly Bill No. 180–Committee on Education

CHAPTER 490

AN ACT relating to education; revising the provisions governing the review of applications to form charter schools submitted to the board of trustees of a school district and the State Board of Education; requiring the governing body of a charter school sponsored by the board of trustees of a larger school district to enroll pupils who reside in the district before enrolling pupils who reside outside the district; revising the provisions governing the licensed personnel of a charter school; revising provisions governing the use of certain accountability information; revising the provisions governing the reporting of accountability information for charter schools sponsored by the State Board of Education; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 385.347 is hereby amended to read as follows:

385.347 1. The board of trustees of each school district in this State, in cooperation with associations recognized by the State Board as representing licensed personnel in education in the district, shall adopt a program providing for the accountability of the school district to the residents of the district and to the State Board for the quality of the schools and the educational achievement of the pupils in the district, including, without limitation, pupils enrolled in charter schools in the school district. The board of trustees of [a] each school district shall [report] :

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ê2005 Statutes of Nevada, Page 2531 (CHAPTER 490, AB 180)ê

(a) Report the information required by subsection 2 for each charter school that is located within the school district, regardless of the sponsor of the charter school.

(b) For the information that is reported in an aggregated format, include the data that is applicable to the charter schools sponsored by the school district but not the charter schools that are sponsored by the State Board.

(c) Denote separately in the report those charter schools that are located within the school district and sponsored by the State Board.

2. The board of trustees of each school district shall, on or before August 15 of each year, prepare an annual report of accountability concerning:

(a) The educational goals and objectives of the school district.

(b) Pupil achievement for each school in the district and the district as a whole, including, without limitation, each charter school in the district. The board of trustees of the district shall base its report on the results of the examinations administered pursuant to NRS 389.015 and 389.550 and shall compare the results of those examinations for the current school year with those of previous school years. The report must include, for each school in the district, including, without limitation, each charter school in the district, and each grade in which the examinations were administered:

(1) The number of pupils who took the examinations;

(2) [An explanation of instances in which a school was exempt from administering or a pupil was exempt from taking an examination;

(3)] A record of attendance for the period in which the examinations were administered, including an explanation of any difference in the number of pupils who took the examinations and the number of pupils who are enrolled in the school;

[(4)] (3) Except as otherwise provided in this paragraph, pupil achievement, reported separately by gender and reported separately for the following subgroups of pupils:

(I) Pupils who are economically disadvantaged, as defined by the State Board;

(II) Pupils from major racial and ethnic groups, as defined by the State Board;

(III) Pupils with disabilities;

(IV) Pupils who are limited English proficient; and

(V) Pupils who are migratory children, as defined by the State Board;

[(5)] (4) A comparison of the achievement of pupils in each subgroup identified in paragraph (b) of subsection 1 of NRS 385.361 with the annual measurable objectives of the State Board;

[(6)] (5) The percentage of pupils who were not tested;

[(7)] (6) Except as otherwise provided in this paragraph, the percentage of pupils who were not tested, reported separately by gender and reported separately for the subgroups identified in subparagraph [(4);] (3);

[(8)] (7) The most recent 3-year trend in pupil achievement in each subject area tested and each grade level tested pursuant to NRS 389.015 and 389.550, which may include information regarding the trend in the achievement of pupils for more than 3 years, if such information is available;

[(9)] (8) Information that compares the results of pupils in the school district, including, without limitation, pupils enrolled in charter schools in the district, with the results of pupils throughout this State.

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ê2005 Statutes of Nevada, Page 2532 (CHAPTER 490, AB 180)ê

district, with the results of pupils throughout this State. The information required by this subparagraph must be provided in consultation with the Department to ensure the accuracy of the comparison; and

[(10)] (9) For each school in the district, including, without limitation, each charter school in the district, information that compares the results of pupils in the school with the results of pupils throughout the school district and throughout this State. The information required by this subparagraph must be provided in consultation with the Department to ensure the accuracy of the comparison.

Ê A separate reporting for a subgroup of pupils must not be made pursuant to this paragraph if the number of pupils in that subgroup is insufficient to yield statistically reliable information or the results would reveal personally identifiable information about an individual pupil. The State Board shall prescribe the mechanism for determining the minimum number of pupils that must be in a subgroup for that subgroup to yield statistically reliable information.

(c) The ratio of pupils to teachers in kindergarten and at each grade level for each elementary school in the district and the district as a whole, including, without limitation, each charter school in the district, and the average class size for each core academic subject, as set forth in NRS 389.018, for each secondary school in the district and the district as a whole, including, without limitation, each charter school in the district.

(d) Information on the professional qualifications of teachers employed by each school in the district and the district as a whole, including, without limitation, each charter school in the district. The information must include, without limitation:

(1) The percentage of teachers who are:

(I) Providing instruction pursuant to NRS 391.125;

(II) Providing instruction pursuant to a waiver of the requirements for licensure for the grade level or subject area in which the teachers are employed; or

(III) Otherwise providing instruction without an endorsement for the subject area in which the teachers are employed;

(2) The percentage of classes in the core academic subjects, as set forth in NRS 389.018, that are not taught by highly qualified teachers; [and]

(3) The percentage of classes in the core academic subjects, as set forth in NRS 389.018, that are not taught by highly qualified teachers, in the aggregate and disaggregated by high-poverty compared to low-poverty schools, which for the purposes of this subparagraph, means schools in the top quartile of poverty and the bottom quartile of poverty in this State [.] ;

(4) For each middle school, junior high school and high school:

(I) On and after July 1, 2005, the number of persons employed as substitute teachers for 20 consecutive days or more in the same classroom or assignment, designated as long-term substitute teachers, including the total number of days long-term substitute teachers were employed at each school, identified by grade level and subject area; and

(II) On and after July 1, 2006, the number of persons employed as substitute teachers for less than 20 consecutive days, designated as short-term substitute teachers, including the total number of days short-term substitute teachers were employed at each school, identified by grade level and subject area; and

(5) For each elementary school:

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ê2005 Statutes of Nevada, Page 2533 (CHAPTER 490, AB 180)ê

(e) The total expenditure per pupil for each school in the district and the district as a whole, including, without limitation, each charter school in the district. If this State has a financial analysis program that is designed to track educational expenditures and revenues to individual schools, each school district shall use that statewide program in complying with this paragraph. If a statewide program is not available, each school district shall use its own financial analysis program in complying with this paragraph.

(f) The curriculum used by the school district, including:

(1) Any special programs for pupils at an individual school; and

(2) The curriculum used by each charter school in the district.

(g) Records of the attendance and truancy of pupils in all grades, including, without limitation:

(1) The average daily attendance of pupils, for each school in the district and the district as a whole, including, without limitation, each charter school in the district.

(2) For each elementary school, middle school and junior high school in the district, including, without limitation, each charter school in the district that provides instruction to pupils enrolled in a grade level other than high school, information that compares the attendance of the pupils enrolled in the school with the attendance of pupils throughout the district and throughout this State. The information required by this subparagraph must be provided in consultation with the Department to ensure the accuracy of the comparison.

(h) The annual rate of pupils who drop out of school in grades 9 to 12, inclusive, for each such grade, for each school in the district and for the district as a whole, excluding pupils who:

(1) Provide proof to the school district of successful completion of the examinations of general educational development.

(2) Are enrolled in courses that are approved by the Department as meeting the requirements for an adult standard diploma.

(3) Withdraw from school to attend another school.

(i) Records of attendance of teachers who provide instruction, for each school in the district and the district as a whole, including, without limitation, each charter school in the district.

(j) Efforts made by the school district and by each school in the district, including, without limitation, each charter school in the district, to increase:

(1) Communication with the parents of pupils in the district; and

(2) The participation of parents in the educational process and activities relating to the school district and each school, including, without limitation, the existence of parent organizations and school advisory committees.

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ê2005 Statutes of Nevada, Page 2534 (CHAPTER 490, AB 180)ê

(k) Records of incidents involving weapons or violence for each school in the district, including, without limitation, each charter school in the district.

(l) Records of incidents involving the use or possession of alcoholic beverages or controlled substances for each school in the district, including, without limitation, each charter school in the district.

(m) Records of the suspension and expulsion of pupils required or authorized pursuant to NRS 392.466 and 392.467.

(n) The number of pupils who are deemed habitual disciplinary problems pursuant to NRS 392.4655, for each school in the district and the district as a whole, including, without limitation, each charter school in the district.

(o) The number of pupils in each grade who are retained in the same grade pursuant to NRS 392.033 or 392.125, for each school in the district and the district as a whole, including, without limitation, each charter school in the district.

(p) The transiency rate of pupils for each school in the district and the district as a whole, including, without limitation, each charter school in the district. For the purposes of this paragraph, a pupil is not transient if he is transferred to a different school within the school district as a result of a change in the zone of attendance by the board of trustees of the school district pursuant to NRS 388.040.

(q) Each source of funding for the school district.

(r) A compilation of the programs of remedial study that are purchased in whole or in part with money received from this State, for each school in the district and the district as a whole, including, without limitation, each charter school sponsored by the district. The compilation must include:

(1) The amount and sources of money received for programs of remedial [education] study for each school in the district and the district as a whole, including, without limitation, each charter school in the district.

(2) An identification of each program of remedial study, listed by subject area.

(s) For each high school in the district, including, without limitation, each charter school in the district, the percentage of pupils who graduated from that high school or charter school in the immediately preceding year and enrolled in remedial courses in reading, writing or mathematics at a university or community college within the University and Community College System of Nevada.

(t) The technological facilities and equipment available at each school, including, without limitation, each charter school, and the district’s plan to incorporate educational technology at each school.

(u) For each school in the district and the district as a whole, including, without limitation, each charter school in the district, the number and percentage of pupils who received:

(1) A standard high school diploma.

(2) An adjusted diploma.

(3) A certificate of attendance.

(v) For each school in the district and the district as a whole, including, without limitation, each charter school in the district, the number and percentage of pupils who did not receive a high school diploma because the pupils failed to pass the high school proficiency examination.

(w) The number of habitual truants who are reported to a school police officer or law enforcement agency pursuant to paragraph (a) of subsection 2 of NRS 392.144 and the number of habitual truants who are referred to an advisory board to review school attendance pursuant to paragraph (b) of subsection 2 of NRS 392.144, for each school in the district and for the district as a whole.

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ê2005 Statutes of Nevada, Page 2535 (CHAPTER 490, AB 180)ê

of NRS 392.144 and the number of habitual truants who are referred to an advisory board to review school attendance pursuant to paragraph (b) of subsection 2 of NRS 392.144, for each school in the district and for the district as a whole.

(x) The amount and sources of money received for the training and professional development of teachers and other educational personnel for each school in the district and for the district as a whole, including, without limitation, each charter school in the district.

(y) Whether the school district has made adequate yearly progress. If the school district has been designated as demonstrating need for improvement pursuant to NRS 385.377, the report must include a statement indicating the number of consecutive years the school district has carried that designation.

(z) Information on whether each public school in the district, including, without limitation, each charter school in the district, has made adequate yearly progress, including, without limitation:

(1) The number and percentage of schools in the district, if any, that have been designated as needing improvement pursuant to NRS 385.3623; and

(2) The name of each school, if any, in the district that has been designated as needing improvement pursuant to NRS 385.3623 and the number of consecutive years that the school has carried that designation.

(aa) Information on the paraprofessionals employed by each public school in the district, including, without limitation, each charter school the district. The information must include:

(1) The number of paraprofessionals employed at the school; and

(2) The number and percentage of all paraprofessionals who do not satisfy the qualifications set forth in 20 U.S.C. § 6319(c). The reporting requirements of this subparagraph apply to paraprofessionals who are employed in positions supported with Title I money and to paraprofessionals who are not employed in positions supported with Title I money.

(bb) For each high school in the district, including, without limitation, each charter school that operates as a high school, information that provides a comparison of the rate of graduation of pupils enrolled in the high school with the rate of graduation of pupils throughout the district and throughout this State. The information required by this paragraph must be provided in consultation with the Department to ensure the accuracy of the comparison.

(cc) An identification of the appropriations made by the Legislature that are available to the school district or the schools within the district and programs approved by the Legislature to improve the academic achievement of pupils.

(dd) Such other information as is directed by the Superintendent of Public Instruction.

3. The records of attendance maintained by a school for purposes of paragraph (i) of subsection 2 must include the number of teachers who are in attendance at school and the number of teachers who are absent from school. A teacher shall be deemed in attendance if the teacher is excused from being present in the classroom by the school in which he is employed for one of the following reasons:

(a) Acquisition of knowledge or skills relating to the professional development of the teacher; or

(b) Assignment of the teacher to perform duties for cocurricular or extracurricular activities of pupils.

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ê2005 Statutes of Nevada, Page 2536 (CHAPTER 490, AB 180)ê

4. The annual report of accountability prepared pursuant to subsection 2 must:

(a) Comply with 20 U.S.C. § 6311(h)(2) and the regulations adopted pursuant thereto; and

(b) Be presented in an understandable and uniform format and , to the extent practicable, provided in a language that parents can understand.

5. The Superintendent of Public Instruction shall:

(a) Prescribe forms for the reports required pursuant to subsection 2 and provide the forms to the respective school districts.

(b) Provide statistical information and technical assistance to the school districts to ensure that the reports provide comparable information with respect to each school in each district and among the districts throughout this State.

(1) Nevada State Education Association;

(2) Nevada Association of School Boards;

(3) Nevada Association of School Administrators;

(4) Nevada Parent Teacher Association;

(5) Budget Division of the Department of Administration; and

(6) Legislative Counsel Bureau,

Ê concerning the program and consider any advice or recommendations submitted by the representatives with respect to the program.

6. The Superintendent of Public Instruction may consult with representatives of parent groups other than the Nevada Parent Teacher Association concerning the program and consider any advice or recommendations submitted by the representatives with respect to the program.

7. On or before [April 1] August 15 of each year, the board of trustees of each school district shall submit to [:

(a) Each] each advisory board to review school attendance created in the county pursuant to NRS 392.126 the information required in paragraph (g) of subsection 2.

[(b) The Commission on Educational Technology created by NRS 388.790 the information prepared by the board of trustees pursuant to paragraph (t) of subsection 2.]

8. On or before August 15 of each year, the board of trustees of each school district shall:

(a) [Submit] Provide written notice that the report required pursuant to subsection 2 is available on the Internet website maintained by the school district, if any, or otherwise provide written notice of the availability of the report. The written notice must be provided to the:

(1) Governor;

(2) State Board;

(3) Department;

(4) Committee; and

(5) Bureau.

(b) Provide for public dissemination of the annual report of accountability prepared pursuant to subsection 2 in the manner set forth in 20 U.S.C. § 6311(h)(2)(E) by posting a copy of the report on the Internet website maintained by the school district, if any. If a school district does not maintain a website, the district shall otherwise provide for public dissemination of the annual report by providing a copy of the report to the schools in the school district, including, without limitation, each charter school in the district, the residents of the district, and the parents and guardians of pupils enrolled in schools in the district, including, without limitation, each charter school in the district.

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ê2005 Statutes of Nevada, Page 2537 (CHAPTER 490, AB 180)ê

schools in the school district, including, without limitation, each charter school in the district, the residents of the district, and the parents and guardians of pupils enrolled in schools in the district, including, without limitation, each charter school in the district.

9. Upon the request of the Governor, an entity described in paragraph (a) of subsection 8 or a member of the general public, the board of trustees of a school district shall provide a portion or portions of the report required pursuant to subsection 2.

10. As used in this section:

(a) “Highly qualified” has the meaning ascribed to it in 20 U.S.C. § 7801(23).

(b) “Paraprofessional” has the meaning ascribed to it in NRS 391.008.

Sec. 2. NRS 386.525 is hereby amended to read as follows:

386.525 1. Upon approval of an application by the Department, a committee to form a charter school may submit the application to the board of trustees of the school district in which the proposed charter school will be located [. If applicable,] , or a committee may submit an application directly to the Subcommittee on Charter Schools pursuant to subsection 4. If the board of trustees of a school district receives an application to form a charter school, it shall consider the application at a regularly scheduled meeting that must be held not later than 30 days after the receipt of the application [,] or a period mutually agreed upon by the committee to form the charter school and the board of trustees of the school district, and ensure that notice of the meeting has been provided pursuant to chapter 241 of NRS. The board of trustees, the Subcommittee on Charter Schools or the State Board, as applicable, shall review an application to determine whether the application:

(a) Complies with NRS 386.500 to 386.610, inclusive, and the regulations applicable to charter schools; and

(b) Is complete in accordance with the regulations of the Department.

2. The Department shall assist the board of trustees of a school district in the review of an application. The board of trustees may approve an application if it satisfies the requirements of paragraphs (a) and (b) of subsection 1. The board of trustees shall provide written notice to the applicant of its approval or denial of the application.

3. If the board of trustees denies an application, it shall include in the written notice the reasons for the denial and the deficiencies in the application. The applicant must be granted 30 days after receipt of the written notice to correct any deficiencies identified in the written notice and resubmit the application.

4. If the board of trustees denies an application after it has been resubmitted pursuant to subsection 3, the applicant may submit a written request for sponsorship by the State Board to the Subcommittee on Charter Schools created pursuant to NRS 386.507 not more than 30 days after receipt of the written notice of denial. [If an applicant proposes to form a charter school exclusively for the enrollment of pupils who receive special education pursuant to NRS 388.440 to 388.520, inclusive, the] An applicant may also submit the written request and application directly to the Subcommittee without first seeking approval from the board of trustees of a school district. Any request that is submitted pursuant to this subsection must be accompanied by the application to form the charter school.

5. If the Subcommittee on Charter Schools receives a request pursuant to subsection 4, it shall hold a meeting to consider the request and the application.

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ê2005 Statutes of Nevada, Page 2538 (CHAPTER 490, AB 180)ê

application. The meeting must be held not later than 30 days after receipt of the application. Notice of the meeting must be posted in accordance with chapter 241 of NRS. The Subcommittee shall review the application in accordance with the factors set forth in paragraphs (a) and (b) of subsection 1. The Subcommittee [shall] may approve an application if it satisfies the requirements of paragraphs (a) and (b) of subsection 1.

6. The Subcommittee on Charter Schools shall transmit the application and the recommendation of the Subcommittee for approval or denial of the application to the State Board. Not more than 14 days after the date of the meeting of the Subcommittee pursuant to subsection 5, the State Board shall hold a meeting to consider the recommendation of the Subcommittee. Notice of the meeting must be posted in accordance with chapter 241 of NRS. The State Board shall review the application in accordance with the factors set forth in paragraphs (a) and (b) of subsection 1. The State Board [shall] may approve an application if it satisfies the requirements of paragraphs (a) and (b) of subsection 1. Not more than 30 days after the meeting, the State Board shall provide written notice of its determination to the applicant.

7. If the State Board denies the application [, the] :

(a) It shall include in the written notice the reasons for the denial and the deficiencies in the application; and

(b) The applicant may, not more than 30 days after the receipt of the written notice from the State Board, appeal the final determination to the district court of the county in which the proposed charter school will be located.

Sec. 3. NRS 386.527 is hereby amended to read as follows:

386.527 1. If the State Board or the board of trustees of a school district approves an application to form a charter school, it shall grant a written charter to the applicant. The State Board or the board of trustees, as applicable, shall, not later than 10 days after the approval of the application, provide written notice to the Department of the approval and the date of the approval. If the board of trustees approves the application, the board of trustees shall be deemed the sponsor of the charter school. If the State Board approves the application:

(a) The State Board shall be deemed the sponsor of the charter school.

(b) Neither the State of Nevada, the State Board nor the Department is an employer of the members of the governing body of the charter school or any of the employees of the charter school.

2. Except as otherwise provided in subsection 4, a written charter must be for a term of 6 years unless the governing body of a charter school renews its initial charter after 3 years of operation pursuant to subsection 2 of NRS 386.530. A written charter must include all conditions of operation set forth in paragraphs (a) to (o), inclusive, of subsection 2 of NRS 386.520 and include the kind of school, as defined in subsections 1 to 4, inclusive, of NRS 388.020 for which the charter school is authorized to operate. If the State Board is the sponsor of the charter school, the written charter must set forth the responsibilities of the sponsor and the charter school with regard to the provision of services and programs to pupils with disabilities who are enrolled in the charter school in accordance with the Individuals with Disabilities Education Act, 20 U.S.C. §§ 1400 et seq., and NRS 388.440 to 388.520, inclusive. As a condition of the issuance of a written charter pursuant to this subsection, the charter school must agree to comply with all conditions of operation set forth in NRS 386.550.

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ê2005 Statutes of Nevada, Page 2539 (CHAPTER 490, AB 180)ê

3. The governing body of a charter school may submit to the sponsor of the charter school a written request for an amendment of the written charter of the charter school. Such an amendment may include, without limitation, the expansion of instruction and other educational services to pupils who are enrolled in grade levels other than the grade levels of pupils currently enrolled in the charter school if the expansion of grade levels does not change the kind of school, as defined in NRS 388.020, for which the charter school is authorized to operate. If the proposed amendment complies with the provisions of this section, NRS 386.500 to 386.610, inclusive, and any other statute or regulation applicable to charter schools, the sponsor [shall] may amend the written charter in accordance with the proposed amendment. If a charter school wishes to expand the instruction and other educational services offered by the charter school to pupils who are enrolled in grade levels other than the grade levels of pupils currently enrolled in the charter school and the expansion of grade levels changes the kind of school, as defined in NRS 388.020, for which the charter school is authorized to operate, the charter school must submit a new application to form a charter school.

4. The State Board shall adopt objective criteria for the issuance of a written charter to an applicant who is not prepared to commence operation on the date of issuance of the written charter. The criteria must include, without limitation, the:

(a) Period for which such a written charter is valid; and

(b) Timelines by which the applicant must satisfy certain requirements demonstrating its progress in preparing to commence operation.

Ê A holder of such a written charter may apply for grants of money to prepare the charter school for operation. A written charter issued pursuant to this subsection must not be designated as a conditional charter or a provisional charter or otherwise contain any other designation that would indicate the charter is issued for a temporary period.

5. The holder of a written charter that is issued pursuant to subsection 4 shall not commence operation of the charter school and is not eligible to receive apportionments pursuant to NRS 387.124 until the sponsor has determined that the requirements adopted by the State Board pursuant to subsection 4 have been satisfied and that the facility the charter school will occupy has been inspected and meets the requirements of any applicable building codes, codes for the prevention of fire, and codes pertaining to safety, health and sanitation. Except as otherwise provided in this subsection, the sponsor shall make such a determination 30 days before the first day of school for the:

(a) Schools of the school district in which the charter school is located that operate on a traditional school schedule and not a year-round school schedule; or

(b) Charter school,

Ê whichever date the sponsor selects. The sponsor shall not require a charter school to demonstrate compliance with the requirements of this subsection more than 30 days before the date selected. However, it may authorize a charter school to demonstrate compliance less than 30 days before the date selected.

Sec. 4. NRS 386.549 is hereby amended to read as follows:

386.549 1. The governing body of a charter school must consist of at least three teachers, as defined in subsection 4, and may consist of, without limitation, parents and representatives of nonprofit organizations and businesses.

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ê2005 Statutes of Nevada, Page 2540 (CHAPTER 490, AB 180)ê

limitation, parents and representatives of nonprofit organizations and businesses. A majority of the members of the governing body must reside in this State. If the membership of the governing body changes, the governing body shall provide written notice to the sponsor of the charter school within 10 working days after such change. A person may serve on the governing body only if he submits an affidavit to the Department indicating that the person [has] :

(a) Has not been convicted of a felony relating to serving on the governing body of a charter school or any offense involving moral turpitude.

(b) Has read and understands material concerning the roles and responsibilities of members of governing bodies of charter schools and other material designed to assist the governing bodies of charter schools, if such material is provided to the person by the Department.

2. The governing body of a charter school is a public body. It is hereby given such reasonable and necessary powers, not conflicting with the Constitution and the laws of the State of Nevada, as may be requisite to attain the ends for which the charter school is established and to promote the welfare of pupils who are enrolled in the charter school.

3. The governing body of a charter school shall, during each calendar quarter, hold at least one regularly scheduled public meeting in the county in which the charter school is located.

4. As used in subsection 1, “teacher” means a person who:

(a) Holds a current license to teach issued pursuant to chapter 391 of NRS; and

(b) Has at least 2 years of experience as an employed teacher.

Ê The term does not include a person who is employed as a substitute teacher.

Sec. 5. NRS 386.580 is hereby amended to read as follows:

386.580 1. An application for enrollment in a charter school may be submitted to the governing body of the charter school by the parent or legal guardian of any child who resides in this State. Except as otherwise provided in this subsection and subsection 2, a charter school shall enroll pupils who are eligible for enrollment in the order in which the applications are received. If the board of trustees of the school district in which the charter school is located has established zones of attendance pursuant to NRS 388.040, the charter school shall, if practicable, ensure that the racial composition of pupils enrolled in the charter school does not differ by more than 10 percent from the racial composition of pupils who attend public schools in the zone in which the charter school is located. If a charter school is sponsored by the board of trustees of a school district located in a county whose population is 100,000 or more, except for a program of distance education provided by the charter school, the charter school shall enroll pupils who are eligible for enrollment who reside in the school district in which the charter school is located before enrolling pupils who reside outside the school district. Except as otherwise provided in subsection 2, if more pupils who are eligible for enrollment apply for enrollment in the charter school than the number of spaces which are available, the charter school shall determine which applicants to enroll pursuant to this subsection on the basis of a lottery system.

2. [A] Before a charter school enrolls pupils who are eligible for enrollment, a charter school that is dedicated to providing educational programs and opportunities to pupils who are at risk may enroll a child who:

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ê2005 Statutes of Nevada, Page 2541 (CHAPTER 490, AB 180)ê

(a) Is a sibling of a pupil who is currently enrolled in the charter school; or

(b) Resides within the school district and within 2 miles of the charter school if the charter school is located in an area that the sponsor of the charter school determines includes a high percentage of children who are at risk . [,

Ê before the charter school enrolls other pupils who are eligible for enrollment.] If space is available after the charter school enrolls pupils pursuant to this paragraph, the charter school may enroll children who reside outside the school district but within 2 miles of the charter school if the charter school is located within an area that the sponsor determines includes a high percentage of children who are at risk.

Ê If more pupils described in this subsection who are eligible apply for enrollment than the number of spaces available, the charter school shall determine which applicants to enroll pursuant to this subsection on the basis of a lottery system.

3. Except as otherwise provided in subsection 7, a charter school shall not accept applications for enrollment in the charter school or otherwise discriminate based on the:

(a) Race;

(b) Gender;

(d) Ethnicity; or

(e) Disability,

Ê of a pupil.

4. If the governing body of a charter school determines that the charter school is unable to provide an appropriate special education program and related services for a particular disability of a pupil who is enrolled in the charter school, the governing body may request that the board of trustees of the school district of the county in which the pupil resides transfer that pupil to an appropriate school.

5. Except as otherwise provided in this subsection, upon the request of a parent or legal guardian of a child who is enrolled in a public school of a school district or a private school, or a parent or legal guardian of a homeschooled child, the governing body of the charter school shall authorize the child to participate in a class that is not otherwise available to the child at his school or home school or participate in an extracurricular activity at the charter school if:

(a) Space for the child in the class or extracurricular activity is available; and

(b) The parent or legal guardian demonstrates to the satisfaction of the governing body that the child is qualified to participate in the class or extracurricular activity.

Ê If the governing body of a charter school authorizes a child to participate in a class or extracurricular activity pursuant to this subsection, the governing body is not required to provide transportation for the child to attend the class or activity. A charter school shall not authorize such a child to participate in a class or activity through a program of distance education provided by the charter school pursuant to NRS 388.820 to 388.874, inclusive.

6. The governing body of a charter school may revoke its approval for a child to participate in a class or extracurricular activity at a charter school pursuant to subsection 5 if the governing body determines that the child has failed to comply with applicable statutes, or applicable rules and regulations.

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ê2005 Statutes of Nevada, Page 2542 (CHAPTER 490, AB 180)ê

pursuant to subsection 5 if the governing body determines that the child has failed to comply with applicable statutes, or applicable rules and regulations. If the governing body so revokes its approval, neither the governing body nor the charter school is liable for any damages relating to the denial of services to the child.

7. This section does not preclude the formation of a charter school that is dedicated to provide educational services exclusively to pupils:

(a) With disabilities;

(b) Who pose such severe disciplinary problems that they warrant an educational program specifically designed to serve a single gender and emphasize personal responsibility and rehabilitation; or

Ê If more eligible pupils apply for enrollment in such a charter school than the number of spaces which are available, the charter school shall determine which applicants to enroll pursuant to this subsection on the basis of a lottery system.

Sec. 6. NRS 386.590 is hereby amended to read as follows:

386.590 1. Except as otherwise provided in this subsection, at least 70 percent of the teachers who provide instruction at a charter school must be licensed teachers. If a charter school is a vocational school, the charter school shall, to the extent practicable, ensure that at least 70 percent of the teachers who provide instruction at the school are licensed teachers, but in no event may more than 50 percent of the teachers who provide instruction at the school be unlicensed teachers.

2. A governing body of a charter school shall employ:

(a) If the charter school offers instruction in kindergarten or grade 1, 2, 3, 4 , [or] 5, 6, 7 or 8, a licensed teacher to teach pupils who are enrolled in those grades. If required by subsection 3 or 4, such a teacher must possess the qualifications required by 20 U.S.C. § 6319(a).

(b) [Except as otherwise provided in subsections 3 and 4, if] If the charter school offers instruction in grade [6, 7, 8,] 9, 10, 11 or 12, a licensed teacher to teach pupils who are enrolled in those grades for the [following courses of study:

(1) English, including reading, composition and writing;

(2) Mathematics;

(3) Science; and

(4) Social studies, which includes only the subjects of history, geography, economics and government.] subjects set forth in subsection 4. If required by subsection 3 or 4, such a teacher must possess the qualifications required by 20 U.S.C. § 6319(a).

(1) If a charter school specializes in arts and humanities, physical education or health education, a licensed teacher to teach those courses of study.

(2) If a charter school specializes in the construction industry or other building industry, licensed teachers to teach courses of study relating to the industry if those teachers are employed full time.

(3) If a charter school specializes in the construction industry or other building industry and the school offers courses of study in computer education, technology or business, licensed teachers to teach those courses of study if those teachers are employed full time.

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ê2005 Statutes of Nevada, Page 2543 (CHAPTER 490, AB 180)ê

3. A person who is initially hired by the governing body of a charter school on or after January 8, 2002, to teach in a program supported with money from Title I must possess the qualifications required by 20 U.S.C. § 6319(a). For the purposes of this subsection, a person is not “initially hired” if he has been employed as a teacher by another school district or charter school in this State without an interruption in employment before the date of hire by his current employer.

4. A teacher who is employed by a charter school, regardless of the date of hire, must, on or before July 1, 2006, possess the qualifications required by 20 U.S.C. § 6319(a) if he teaches one or more of the following subjects:

(a) English, reading or language arts;

(b) Mathematics;

(d) Foreign language;

(e) Civics or government;

(f) Economics;

(g) Geography;

(h) History; or

(i) The arts.

5. A charter school may employ a person who is not licensed pursuant to the provisions of chapter 391 of NRS to teach a course of study for which a licensed teacher is not required pursuant to subsections 2, 3 and 4 if the person has:

(a) A degree, a license or a certificate in the field for which he is employed to teach at the charter school; and

(b) At least 2 years of experience in that field.

6. A charter school may employ such administrators for the school as it deems necessary. A person employed as an administrator must possess:

(a) A valid teacher’s license issued pursuant to chapter 391 of NRS with an administrative endorsement;

(b) A master’s degree in school administration, public administration or business administration; or

[(b)] (c) If the person has at least 5 years of experience in administration, a baccalaureate degree.

7. A charter school shall not employ a person pursuant to this section if his license to teach or provide other educational services has been revoked or suspended in this State or another state.

8. On or before November 15 of each year, a charter school shall submit to the Department, in a format prescribed by the Superintendent of Public Instruction, the following information for each licensed employee who is employed by the governing body on October 1 of that year:

(a) The amount of salary of the employee; and

(b) The designated assignment, as that term is defined by the Department, of the employee.

Sec. 7. NRS 386.595 is hereby amended to read as follows:

386.595 1. All employees of a charter school shall be deemed public employees.

2. Except as otherwise provided in this subsection, the provisions of the collective bargaining agreement entered into by the board of trustees of the school district in which the charter school is located apply to the terms and conditions of employment of employees of the charter school who are on a leave of absence from the school district pursuant to subsection 5, including, without limitation, any provisions relating to representation by the employee organization that is a party to the collective bargaining agreement of the school district in a grievance proceeding or other dispute arising out of the agreement.

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ê2005 Statutes of Nevada, Page 2544 (CHAPTER 490, AB 180)ê

without limitation, any provisions relating to representation by the employee organization that is a party to the collective bargaining agreement of the school district in a grievance proceeding or other dispute arising out of the agreement. The provisions of the collective bargaining agreement apply to each employee for the first 3 years that he is on a leave of absence from the school district. After the first 3 years : [that the employee is on a leave of absence:]

(a) If he is subsequently reassigned by the school district pursuant to subsection 5, he is covered by the collective bargaining agreement of the school district.

(b) If he continues his employment with the charter school, he is covered by the collective bargaining agreement of the charter school, if applicable.

3. Except as otherwise provided in subsection 2, the governing body of a charter school may make all employment decisions with regard to its employees pursuant to NRS 391.311 to 391.3197, inclusive, unless a collective bargaining agreement entered into by the governing body pursuant to chapter 288 of NRS contains separate provisions relating to the discipline of licensed employees of a school.

4. Except as otherwise provided in this subsection, if the written charter of a charter school is revoked or if a charter school ceases to operate as a charter school, the employees of the charter school must be reassigned to employment within the school district in accordance with the applicable collective bargaining agreement. A school district is not required to reassign an employee of a charter school pursuant to this subsection if the employee:

(a) Was not granted a leave of absence by the school district to teach at the charter school pursuant to subsection 5; or

(b) Was granted a leave of absence by the school district and did not submit a written request to return to employment with the school district in accordance with subsection 5.

5. The board of trustees of a school district that is a sponsor of a charter school shall grant a leave of absence, not to exceed [6] 3 years, to any employee who is employed by the board of trustees who requests such a leave of absence to accept employment with the charter school. After the first school year in which an employee is on a leave of absence, he may return to his former teaching position with the board of trustees. [After the third school year, an employee who is on a leave of absence may submit a written request to the board of trustees to return to a comparable teaching position with the board of trustees.] After the [sixth] third school year, an employee shall either submit a written request to return to a comparable teaching position or resign from the position for which his leave was granted. The board of trustees shall grant a written request to return to a comparable position pursuant to this subsection even if the return of the employee requires the board of trustees to reduce the existing workforce of the school district. The board of trustees may require that a request to return to a teaching position submitted pursuant to this subsection be submitted at least 90 days before the employee would otherwise be required to report to duty.

6. An employee who is on a leave of absence from a school district pursuant to this section shall contribute to and be eligible for all benefits for which he would otherwise be entitled, including, without limitation, participation in the Public Employees’ Retirement System and accrual of time for the purposes of leave and retirement. The time during which such an employee is on leave of absence and employed in a charter school does not count toward the acquisition of permanent status with the school district.

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ê2005 Statutes of Nevada, Page 2545 (CHAPTER 490, AB 180)ê

employee is on leave of absence and employed in a charter school does not count toward the acquisition of permanent status with the school district.

7. Upon the return of a teacher to employment in the school district, he is entitled to the same level of retirement, salary and any other benefits to which he would otherwise be entitled if he had not taken a leave of absence to teach in a charter school.

8. An employee of a charter school who is not on a leave of absence from a school district is eligible for all benefits for which he would be eligible for employment in a public school, including, without limitation, participation in the Public Employees’ Retirement System.

9. For all employees of a charter school:

(a) The compensation that a teacher or other school employee would have received if he were employed by the school district must be used to determine the appropriate levels of contribution required of the employee and employer for purposes of the Public Employees’ Retirement System.

(b) The compensation that is paid to a teacher or other school employee that exceeds the compensation that he would have received if he were employed by the school district must not be included for the purposes of calculating future retirement benefits of the employee.

10. If the board of trustees of a school district in which a charter school is located manages a plan of group insurance for its employees, the governing body of the charter school may negotiate with the board of trustees to participate in the same plan of group insurance that the board of trustees offers to its employees. If the employees of the charter school participate in the plan of group insurance managed by the board of trustees, the governing body of the charter school shall:

(a) Ensure that the premiums for that insurance are paid to the board of trustees; and

(b) Provide, upon the request of the board of trustees, all information that is necessary for the board of trustees to provide the group insurance to the employees of the charter school.

Sec. 8. NRS 386.605 is hereby amended to read as follows:

386.605 1. On or before July 15 of each year, the governing body of [each] a charter school that is sponsored by the board of trustees of a school district shall submit the information concerning the charter school that is required pursuant to subsection 2 of NRS 385.347 to the board of trustees [of the school district in which] that sponsors the charter school [is located, regardless of the sponsor of the charter school,] for inclusion in the report of the school district pursuant to that section. The information must be submitted by the charter school in a format prescribed by the board of trustees.

2. On or before [August 15 of each year, the governing body of each charter school shall submit the information applicable to the charter school that is contained in the report pursuant to paragraph (t) of subsection 2 of NRS 385.347 to the Commission on Educational Technology created pursuant to NRS 388.790.] July 15 of each year, the governing body of a charter school that is sponsored by the State Board shall submit the information described in subsection 2 of NRS 385.347 to the Department in a format prescribed by the Department. The Department shall forward the information to the school district in which the charter school is located for inclusion in the report that is prepared by the school district pursuant to NRS 385.347.

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ê2005 Statutes of Nevada, Page 2546 (CHAPTER 490, AB 180)ê

3. The Legislative Bureau of Educational Accountability and Program Evaluation created pursuant to NRS 218.5356 may authorize a person or entity with whom it contracts pursuant to NRS 385.359 to review and analyze information submitted by charter schools pursuant to this section and NRS 385.357, consult with the governing bodies of charter schools and submit written reports concerning charter schools pursuant to NRS 385.359.

Sec. 9. NRS 386.610 is hereby amended to read as follows:

386.610 1. On or before [July 1] August 15 of each year, if the board of trustees of a school district sponsors a charter school, the board of trustees shall submit a written report to the State Board. The written report must include an evaluation of the progress of each charter school sponsored by the board of trustees in achieving its educational goals and objectives.

2. The governing body of a charter school shall, after 3 years of operation under its initial charter, submit a written report to the sponsor of the charter school. The written report must include a description of the progress of the charter school in achieving its educational goals and objectives. If the charter school submits an application for renewal in accordance with the regulations of the Department, the sponsor may renew the written charter of the school pursuant to subsection 2 of NRS 386.530.

Sec. 10. NRS 386.650 is hereby amended to read as follows:

386.650 1. The Department shall establish and maintain an automated system of accountability information for Nevada. The system must:

(a) Have the capacity to provide and report information, including, without limitation, the results of the achievement of pupils:

(1) In the manner required by 20 U.S.C. §§ 6301 et seq., and the regulations adopted pursuant thereto, and NRS 385.3469 and 385.347; and

(2) In a separate reporting for each subgroup of pupils identified in paragraph (b) of subsection 1 of NRS 385.361;

(b) Include a system of unique identification for each pupil:

(1) To ensure that individual pupils may be tracked over time throughout this State; and

(2) That, to the extent practicable, may be used for purposes of identifying a pupil for both the public schools and the University and Community College System of Nevada, if that pupil enrolls in the System after graduation from high school;

(c) Have the capacity to provide longitudinal comparisons of the academic achievement, rate of attendance and rate of graduation of pupils over time throughout this State;

(d) Have the capacity to perform a variety of longitudinal analyses of the results of individual pupils on assessments, including, without limitation, the results of pupils by classroom and by school;

(e) Have the capacity to identify which teachers are assigned to individual pupils and which paraprofessionals, if any, are assigned to provide services to individual pupils;

(f) Have the capacity to provide other information concerning schools and school districts that is not linked to individual pupils, including, without limitation, the designation of schools and school districts pursuant to NRS 385.3623 and 385.377, respectively, and an identification of which schools, if any, are persistently dangerous;

(g) Have the capacity to access financial accountability information for each public school, including, without limitation, each charter school, for each school district and for this State as a whole; and

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ê2005 Statutes of Nevada, Page 2547 (CHAPTER 490, AB 180)ê

(h) Be designed to improve the ability of the Department, school districts and the public schools in this State, including, without limitation, charter schools, to account for the pupils who are enrolled in the public schools, including, without limitation, charter schools.

Ê The information maintained pursuant to paragraphs (c), (d) and (e) must be used for the purpose of improving the achievement of pupils and improving classroom instruction but must not be used for the purpose of evaluating an individual teacher or paraprofessional.

2. The board of trustees of each school district shall:

(a) Adopt and maintain the program prescribed by the Superintendent of Public Instruction pursuant to subsection 3 for the collection, maintenance and transfer of data from the records of individual pupils to the automated system of information, including, without limitation, the development of plans for the educational technology which is necessary to adopt and maintain the program;

(b) Provide to the Department electronic data concerning pupils as required by the Superintendent of Public Instruction pursuant to subsection 3; and

3. The Superintendent of Public Instruction shall:

(a) Prescribe a uniform program throughout this State for the collection, maintenance and transfer of data that each school district must adopt, which must include standardized software;

(b) Prescribe the data to be collected and reported to the Department by each school district and each sponsor of a charter school pursuant to subsection 2 ; [, including, without limitation, data relating to each charter school located within a school district regardless of the sponsor of the charter school;]

(d) Prescribe the date by which each school district shall report the data;

(e) Prescribe the date by which each charter school [located within a school district] shall report the data to the [school district for incorporation into the report of the school district, regardless of the] sponsor of the charter school;

(f) Prescribe standardized codes for all data elements used within the automated system and all exchanges of data within the automated system, including, without limitation, data concerning:

(1) Individual pupils;

(2) Individual teachers and paraprofessionals;

(3) Individual schools and school districts; and

(4) Programs and financial information;

(g) Provide technical assistance to each school district to ensure that the data from each public school in the school district, including, without limitation, each charter school located within the school district, is compatible with the automated system of information and comparable to the data reported by other school districts; and

(h) Provide for the analysis and reporting of the data in the automated system of information.

4. The Department shall establish, to the extent authorized by the Family Educational Rights and Privacy Act of 1974, 20 U.S.C. § 1232g, and any regulations adopted pursuant thereto, a mechanism by which persons or entities, including, without limitation, state officers who are members of the Executive or Legislative Branch, administrators of public schools and school districts, teachers and other educational personnel, and parents and guardians, will have different types of access to the accountability information contained within the automated system to the extent that such information is necessary for the performance of a duty or to the extent that such information may be made available to the general public without posing a threat to the confidentiality of an individual pupil.

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ê2005 Statutes of Nevada, Page 2548 (CHAPTER 490, AB 180)ê

entities, including, without limitation, state officers who are members of the Executive or Legislative Branch, administrators of public schools and school districts, teachers and other educational personnel, and parents and guardians, will have different types of access to the accountability information contained within the automated system to the extent that such information is necessary for the performance of a duty or to the extent that such information may be made available to the general public without posing a threat to the confidentiality of an individual pupil.

5. The Department may, to the extent authorized by the Family Educational Rights and Privacy Act of 1974, 20 U.S.C. § 1232g, and any regulations adopted pursuant thereto, enter into an agreement with the University and Community College System of Nevada to provide access to data contained within the automated system for research purposes.

Sec. 11. NRS 386.655 is hereby amended to read as follows:

386.655 1. The Department, the school districts and the public schools, including, without limitation, charter schools, shall, in operating the automated system of information established pursuant to NRS 386.650, comply with the provisions of:

(a) For all pupils, the Family Educational Rights and Privacy Act, 20 U.S.C. § 1232g, and any regulations adopted pursuant thereto; and

(b) For pupils with disabilities who are enrolled in programs of special education, the provisions governing access to education records and confidentiality of information prescribed in the Individuals with Disabilities Education Act, 20 U.S.C. § 1417(c), and the regulations adopted pursuant thereto.

2. Except as otherwise provided in 20 U.S.C. § 1232g(b) and any other applicable federal law, a public school, including, without limitation, a charter school, shall not release the education records of a pupil to a person or an agency of a federal, state or local government without the written consent of the parent or legal guardian of the pupil.

3. In addition to the record required pursuant to 20 U.S.C. § 1232g(b)(4)(A), each school district and each sponsor of a charter school shall maintain within the automated system of information an electronic record of all persons and agencies who have requested the education record of a pupil or obtained access to the education record of a pupil, or both, pursuant to 20 U.S.C. § 1232g. The electronic record must be maintained and may only be disclosed in accordance with the provisions of 20 U.S.C. § 1232g. A charter school shall provide to the sponsor of the charter school [district in which the charter school is located] such information as is necessary for the [school district] sponsor to carry out the provisions of this subsection . [, regardless of the sponsor of the charter school.]

4. The right accorded to a parent or legal guardian of a pupil pursuant to subsection 2 devolves upon the pupil on the date on which he attains the age of 18 years.

5. As used in this section, unless the context otherwise requires, “education records” has the meaning ascribed to it in 20 U.S.C. § 1232g(a)(4).

Sec. 12. Section 1 of Assembly Bill No. 206 of this session is hereby amended to read as follows:

Section 1. NRS 391.019 is hereby amended to read as follows:

391.019 1. Except as otherwise provided in NRS 391.027, the Commission:

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ê2005 Statutes of Nevada, Page 2549 (CHAPTER 490, AB 180)ê

(a) Shall adopt regulations:

(1) Prescribing the qualifications for licensing teachers and other educational personnel, including, without limitation, the qualifications for a license to teach middle school or junior high school education, and the procedures for the issuance and renewal of such licenses.

(2) Identifying fields of specialization in teaching which require the specialized training of teachers.

(3) Except as otherwise provided in NRS 391.125, requiring teachers to obtain from the Department an endorsement in a field of specialization to be eligible to teach in that field of specialization.

(4) Setting forth the educational requirements a teacher must satisfy to qualify for an endorsement in each field of specialization.

(5) Setting forth the qualifications and requirements for obtaining a license or endorsement to teach American Sign Language, including, without limitation, being qualified to engage in the practice of interpreting pursuant to subsection 3 of NRS 656A.100.

(6) Except as otherwise authorized by subsection 4 of NRS 656A.100, requiring teachers and other educational personnel to satisfy the qualifications set forth in subsection 3 of NRS 656A.100 if they:

(I) Provide instruction or other educational services; and

(II) Concurrently engage in the practice of interpreting, as defined in NRS 656A.060.

(7) Providing for the issuance and renewal of a special qualifications license to an applicant who holds a master’s degree or a doctoral degree from an accredited degree-granting postsecondary educational institution in a field for which the applicant will provide instruction in a classroom and who has:

(I) At least 2 years of experience teaching at an accredited degree-granting postsecondary educational institution in a field for which the applicant will provide instruction in a classroom and at least 3 years of experience working in that field; or

(II) At least 5 years of experience working in a field for which the applicant will provide instruction in a classroom.

(8) Requiring an applicant for a special qualifications license to:

(I) Pass each examination required by NRS 391.021 for the specific subject or subjects in which the applicant will provide instruction; or

(II) Hold a valid license issued by a professional licensing board of any state that is directly related to the subject area of the master’s degree or doctoral degree held by the applicant.

(9) Setting forth the subject areas that may be taught by a person who holds a special qualifications license, based upon the subject area of the master’s degree or doctoral degree held by that person.

(b) May adopt such other regulations as it deems necessary for its own government or to carry out its duties.

2. Any regulation which increases the amount of education, training or experience required for licensing:

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ê2005 Statutes of Nevada, Page 2550 (CHAPTER 490, AB 180)ê

(a) Must, in addition to the requirements for publication in chapter 233B of NRS, be publicized before its adoption in a manner reasonably calculated to inform those persons affected by the change.

(b) Must not become effective until at least 1 year after the date it is adopted by the Commission.

3. A person who is licensed pursuant to subparagraph (7) of paragraph (a) of subsection 1:

(a) Shall comply with all applicable statutes and regulations.

(b) Except as otherwise provided by specific statute, is entitled to all benefits, rights and privileges conferred by statutes and regulations on licensed teachers.

(c) Except as otherwise provided by specific statute, if he is employed as a teacher by the board of trustees of a school district or the governing body of a charter school, is entitled to all benefits, rights and privileges conferred by statutes and regulations on the licensed employees of a school district or charter school, as applicable.

Sec. 13. Section 2 of this act applies to each application to form a charter school that is pending before the Subcommittee on Charter Schools or the State Board of Education on and after the effective date of this act, regardless of whether the application was submitted to the Subcommittee or State Board before the effective date of this act.

Sec. 14. The amendatory provisions of section 7 of this act do not apply to a teacher who is on an approved leave of absence from a school district and is employed by the governing body of a charter school before July 1, 2005.

Sec. 15. 1. This section and sections 2, 12 and 13 of this act become effective upon passage and approval.

2. Sections 1, 3 to 11, inclusive, and 14 of this act become effective on July 1, 2005.

________

CHAPTER 491, AB 39

Assembly Bill No. 39–Assemblyman Parks

CHAPTER 491

AN ACT relating to government; providing a procedure for a bidder to file a notice of protest regarding certain contracts; expanding the criteria that may be used to select the lowest responsive and responsible bidder on certain contracts; expanding the types of contracts which by nature are not adapted to award by competitive bidding; requiring the Attorney General to defend a state officer or employee alleged to have committed an ethical violation under certain circumstances; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

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ê2005 Statutes of Nevada, Page 2551 (CHAPTER 491, AB 39)ê

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 332 of NRS is hereby amended by adding thereto a new section to read as follows:

1. A person who submits a bid on a contract that is required to be advertised pursuant to paragraph (a) of subsection 1 of NRS 332.039 may, after the bids are opened and within the period specified by the governing body or its authorized representative, file with the governing body or its authorized representative a notice of protest regarding the awarding of the contract.

2. A notice of protest must include a written statement setting forth with specificity the reasons the person filing the notice believes the applicable provisions of law were violated.

3. A person filing a notice of protest may be required by the governing body or its authorized representative, at the time the notice of protest is filed, to post a bond with a good and solvent surety authorized to do business in this State or submit other security, in a form approved by the governing body or its authorized representative, to the governing body or its authorized representative who shall hold the bond or other security until a determination is made on the protest. A bond posted or other security submitted with a notice of protest must be in an amount equal to the lesser of:

(a) Twenty-five percent of the total value of the bid submitted by the person filing the notice of protest; or

(b) Two hundred fifty thousand dollars.

4. A notice of protest filed in accordance with the provisions of this section operates as a stay of action in relation to the awarding of any contract until a determination is made by the governing body or its authorized representative on the protest.

5. A person who submits an unsuccessful bid may not seek any type of judicial intervention until the governing body or its authorized representative has made a determination on the protest and awarded the contract.

6. A governing body or its authorized representative is not liable for any costs, expenses, attorney’s fees, loss of income or other damages sustained by a person who submits a bid, whether or not the person files a notice of protest pursuant to this section.

7. If the protest is upheld, the bond posted or other security submitted with the notice of protest must be returned to the person who posted the bond or submitted the security. If the protest is rejected, a claim may be made against the bond or other security by the governing body or its authorized representative in an amount equal to the expenses incurred by the governing body or its authorized representative because of the unsuccessful protest. Any money remaining after the claim has been satisfied must be returned to the person who posted the bond or submitted the security.

Sec. 2. NRS 332.039 is hereby amended to read as follows:

332.039 1. Except as otherwise provided by specific statute:

(a) A governing body or its authorized representative shall advertise all contracts for which the estimated amount required to perform the contract exceeds $25,000.

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ê2005 Statutes of Nevada, Page 2552 (CHAPTER 491, AB 39)ê

(b) A governing body or its authorized representative may enter into a contract of any nature without advertising if the estimated amount required to perform the contract is $25,000 or less.

(c) If the estimated amount required to perform the contract is more than $10,000 but not more than $25,000, requests for bids must be submitted or caused to be submitted by the governing body or its authorized representative to two or more persons capable of performing the contract, if available. The governing body or its authorized representative shall maintain a record of all requests for bids and all bids received for the contract for at least 7 years after the date of execution of the contract.

2. This section does not prohibit a governing body or its authorized representative from advertising for or requesting bids regardless of the estimated amount to perform the contract.

Sec. 3. NRS 332.045 is hereby amended to read as follows:

332.045 1. The advertisement required by paragraph (a) of subsection 1 of NRS 332.039 must be published at least once and not less than 7 days before the opening of bids. The advertisement must be by notice to bid [,] and must be published in a newspaper [published and having] qualified pursuant to chapter 238 of NRS that has a general circulation within the county wherein the local government, or a major portion thereof, is situated. [If no such newspaper is published in the county, then publication must be in any newspaper published in the State having general circulation in the county.]

2. The notice must state:

(a) The nature, character or object of the contract.

(b) If plans and specifications are to constitute part of the contract, where the plans and specifications may be seen.

(d) Such other matters as may properly pertain to giving notice to bid.

Sec. 4. NRS 332.047 is hereby amended to read as follows:

332.047 1. A governing body or its authorized representative may use on-line bidding to receive bids submitted in response to a request for bids. The governing body or its authorized representative shall not use on-line bidding as the exclusive means of receiving bids for the request for bids.

2. A request for bids for which bids may be submitted pursuant to subsection 1 must designate a date and time at which bids may be submitted and may designate a date and time after which bids will no longer be received.

3. A governing body or its authorized representative may require bidders to:

(a) Register before the date and time at which bids may be submitted; and

(b) Agree to terms, conditions or requirements of the request for bids to facilitate on-line bidding.

4. The procedures established by a governing body or its authorized representative for the purposes of conducting on-line bidding must not conflict with the provisions of this chapter.

5. As used in this section, “on-line bidding” means a process by which bidders submit bids for a contract on a secure website on the Internet or its successor, if any, which is established and maintained for that purpose.

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ê2005 Statutes of Nevada, Page 2553 (CHAPTER 491, AB 39)ê

Sec. 5. NRS 332.061 is hereby amended to read as follows:

332.061 1. Except as otherwise provided in this subsection, proprietary information [regarding a trade secret] does not constitute public information and is confidential. A person shall not disclose proprietary information [regarding a trade secret unless the] unless:

(a) The disclosure is made for the purpose of a civil, administrative or criminal investigation or proceeding [, and the] ; and

(b) The person receiving the information represents in writing that protections exist under applicable law to preserve the integrity, confidentiality and security of the information.

2. A bid which contains a provision that requires negotiation or evaluation by the governing body or an evaluator may not be disclosed until the bid is recommended for the award of a contract.

Sec. 6. NRS 332.065 is hereby amended to read as follows:

332.065 1. If a governing body or its authorized representative has advertised for or requested bids in letting a contract, the governing body or its authorized representative must, except as otherwise provided in subsection 2, award the contract to the lowest responsive and responsible bidder. The lowest responsive and responsible bidder may be judged on the basis of:

(a) Price;

(b) Conformance to specifications;

(d) Past performance;

(e) Performance or delivery date;

(f) Quality and utility of services, supplies, materials or equipment offered and the adaptability of those services, supplies, materials or equipment to the required purpose of the contract; [and]

(g) The best interests of the public [.] ; and

(h) Such other criteria as may be set forth by the governing body or its authorized representative in the advertisement or request for bids, as applicable, that pertains to the contract.

2. The governing body or its authorized representative:

(a) Shall give preference to recycled products if:

(1) The product meets the applicable standards;

(2) The product can be substituted for a comparable nonrecycled product; and

(3) The product costs no more than a comparable nonrecycled product.

(b) May give preference to recycled products if:

(1) The product meets the applicable standards;

(2) The product can be substituted for a comparable nonrecycled product; and

(3) The product costs no more than 5 percent more than a comparable nonrecycled product.

(1) Available at a price which is not more than 10 percent higher than that of paper products made from virgin material;

(2) Of adequate quality; and

(3) Available to the purchaser within a reasonable period.

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ê2005 Statutes of Nevada, Page 2554 (CHAPTER 491, AB 39)ê

3. If after the lowest responsive and responsible bidder has been awarded the contract, during the term of the contract he does not supply goods or services in accordance with the bid specifications, or if he repudiates the contract, the governing body or its authorized representative may reaward the contract to the next lowest responsive and responsible bidder without requiring that new bids be submitted. Reawarding the contract to the next lowest responsive and responsible bidder is not a waiver of any liability of the initial bidder awarded the contract.

4. As used in this section:

(a) “Postconsumer waste” means a finished material which would normally be disposed of as a solid waste having completed its life cycle as a consumer item.

(b) “Recycled paper product” means all paper and wood-pulp products containing in some combination at least 50 percent of its total weight:

(1) Postconsumer waste; and

(2) Secondary waste,

Ê but does not include fibrous waste generated during the manufacturing process such as fibers recovered from wastewater or trimmings of paper machine rolls, wood slabs, chips, sawdust or other wood residue from a manufacturing process.

(c) “Secondary waste” means fragments of products or finished products of a manufacturing process which has converted a virgin resource into a commodity of real economic value.

Sec. 7. NRS 332.115 is hereby amended to read as follows:

332.115 1. Contracts which by their nature are not adapted to award by competitive bidding, including contracts for:

(a) Items which may only be contracted from a sole source;

(b) Professional services;

(c) Additions to and repairs and maintenance of equipment which may be more efficiently added to, repaired or maintained by a certain person;

(d) Equipment which, by reason of the training of the personnel or of an inventory of replacement parts maintained by the local government is compatible with existing equipment;

(e) Perishable goods;

(f) Insurance;

(g) Hardware and associated peripheral equipment and devices for computers;

(h) Software for computers;

(i) Books, library materials and subscriptions;

(j) Motor vehicle fuel purchased by a local law enforcement agency for use in an undercover investigation;

(k) Motor vehicle fuel for use in a vehicle operated by a local law enforcement agency or local fire department if such fuel is not available within the vehicle’s assigned service area from a fueling station owned by the State of Nevada or a local government;

(l) Purchases made with money in a store fund for prisoners in a jail or local detention facility for the provision and maintenance of a canteen for the prisoners;

(m) Supplies, materials or equipment that are available pursuant to an agreement with a vendor that has entered into an agreement with the General Services Administration or another governmental agency located within or outside this State;

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ê2005 Statutes of Nevada, Page 2555 (CHAPTER 491, AB 39)ê

(n) Items for resale through a retail outlet operated in this State by a local government or the State of Nevada;

(o) Commercial advertising within a recreational facility operated by a county fair and recreation board; [and]

(p) Goods or services purchased from organizations or agencies whose primary purpose is the training and employment of handicapped persons [,] ; and

(q) The design of, and equipment and services associated with, systems of communication,

Ê are not subject to the requirements of this chapter for competitive bidding, as determined by the governing body or its authorized representative.

2. The purchase of equipment for use by a local law enforcement agency in the course of an undercover investigation is not subject to the requirements of this chapter for competitive bidding, as determined by the governing body or its authorized representative, if:

(a) The equipment is an electronic or mechanical device which by design is intended to monitor and document in a clandestine manner suspected criminal activity; or

(b) Purchasing the equipment pursuant to such requirements would limit or compromise the use of such equipment by an agency authorized to conduct such investigations.

3. The purchase of personal safety equipment for use by a local fire department or local law enforcement agency is not subject to the requirements of this chapter for competitive bidding, as determined by the governing body or its authorized representative, if:

(a) The personal safety equipment will be used by personnel of the fire department or law enforcement agency in responding to emergencies in which the health, safety or welfare of those personnel may be compromised, impaired or otherwise threatened; and

(b) The cost of the personal safety equipment is comparable to the cost of similar personal safety equipment that is available for purchase by the public.

4. The governing body of a hospital required to comply with the provisions of this chapter, or its authorized representative, may purchase goods commonly used by the hospital, under a contract awarded pursuant to NRS 332.065, without additional competitive bidding even if at the time the contract was awarded:

(a) The vendor supplying such goods to the person awarded the contract was not identified as a supplier to be used by the person awarded the contract; or

(b) The vendor was identified as a supplier but was not identified as the supplier of such goods.

Ê The governing body of the hospital shall make available for public inspection each such contract and records related to those purchases.

5. This section does not prohibit a governing body or its authorized representative from advertising for or requesting bids.

6. As used in this section, “personal safety equipment” means safety equipment that is worn or otherwise carried on a regular basis by personnel of a fire department or law enforcement agency. The term includes, but is not limited to, firearms, boots, bulletproof vests or other types of body armor, protective garments, gloves and helmets.

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ê2005 Statutes of Nevada, Page 2556 (CHAPTER 491, AB 39)ê

Sec. 8. NRS 332.195 is hereby amended to read as follows:

332.195 1. A governing body or its authorized representative and the State of Nevada may join or use the contracts of [other] local governments located within or outside this State with the authorization of the contracting vendor. The originally contracting local government is not liable for the obligations of the [local government] governmental entity which joins or uses the contract.

2. A governing body or its authorized representative may join or use the contracts of the State of Nevada or another state with the authorization of the contracting vendor. The State of Nevada or other state is not liable for the obligations of the local government which joins or uses the contract.

Sec. 9. NRS 332.820 is hereby amended to read as follows:

332.820 1. Any agreement or collusion among bidders or prospective bidders in restraint of freedom of competition by agreement to bid a fixed price, or otherwise, shall render the bids of such bidders void.

2. Advance disclosures of proprietary information or any other information to any particular bidder which would give that particular bidder any advantage over any other interested bidder in advance of the opening of bids, whether in response to advertising or an informal request for bids, made or permitted by a member of the governing body or an employee or representative thereof, shall operate to void all bids received in response to that particular request for bids.

Sec. 10. Chapter 281 of NRS is hereby amended by adding thereto a new section to read as follows:

1. If a request for an opinion is submitted to or initiated by the Commission concerning a present or former state officer or employee, unless the state officer or employee retains his own legal counsel or the Attorney General tenders the defense of the state officer or employee to an insurer who, pursuant to a contract of insurance, is authorized to defend the state officer or employee, the Attorney General shall defend the state officer or employee or employ special counsel to defend the state officer or employee in any proceeding relating to the request for the opinion if:

(a) The state officer or employee submits a written request for defense in the manner provided in NRS 41.0339; and

(b) Based on the facts and allegations known to the Attorney General, the Attorney General determines that the act or omission on which the alleged violation is based:

(1) Appears to be within the course and scope of public duty or employment of the state officer or employee; and

(2) Appears to have been performed or omitted in good faith.

2. The Attorney General shall create a written record setting forth the basis for his determination of whether to defend the state officer or employee pursuant to paragraph (b) of subsection 1. The written record is not admissible in evidence at trial or in any other judicial or administrative proceeding in which the state officer or employee is a party, except in connection with an application to withdraw as the attorney of record.

Sec. 11. NRS 281.431 is hereby amended to read as follows:

281.431 As used in NRS 281.411 to 281.581, inclusive, and section 10 of this act, unless the context otherwise requires, the words and terms defined in NRS 281.432 to 281.4375, inclusive, have the meanings ascribed to them in those sections.

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ê2005 Statutes of Nevada, Page 2557 (CHAPTER 491, AB 39)ê

Sec. 12. The provisions of section 10 of this act do not apply to any present or former state officer or employee concerning to whom a request for an opinion was submitted or initiated by the Commission on Ethics pursuant to NRS 281.411 to 281.581, inclusive, before July 1, 2005.

Sec. 13. This act becomes effective on July 1, 2005.

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CHAPTER 492, AB 327

Assembly Bill No. 327–Committee on Health and Human Services

CHAPTER 492

AN ACT relating to medical services; authorizing the board of hospital trustees of a county hospital to compensate physicians for providing certain services to indigent persons; revising the provisions relating to limiting the liability of a person who renders gratuitous medical care involving the use of an automated external defibrillator; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 450.180 is hereby amended to read as follows:

450.180 The board of hospital trustees may:

1. Appoint a chief executive officer and necessary assistants, and fix their compensations.

2. Employ physicians and interns, either full-time or part-time, as the board determines necessary, and fix their compensations.

3. Remove those appointees and employees.

4. Control the admission of physicians and interns to the staff by promulgating appropriate rules, regulations and standards governing those appointments.

5. Contract with individual physicians or private medical associations for the provision of certain medical services as may be required by the hospital. [The compensation provided for in the contract must not include compensation to the physician for services rendered to indigent patients.]

Sec. 2. NRS 450.440 is hereby amended to read as follows:

450.440 1. The board of hospital trustees shall organize a staff of physicians composed of each regular practicing physician, podiatric physician and dentist in the county in which the hospital is located who requests staff membership and meets the standards set forth in the regulations prescribed by the board of hospital trustees.

2. The staff shall organize in a manner prescribed by the board so that there is a rotation of service among the members of the staff to give proper medical and surgical attention and service to the indigent sick, injured or maimed who may be admitted to the hospital for treatment.

3. [No member of the staff or any other physician who attends an indigent patient may receive any compensation for his services except as otherwise provided in NRS 450.180 or to the extent that the medical care is paid for by any governmental authority or any private medical care program.

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ê2005 Statutes of Nevada, Page 2558 (CHAPTER 492, AB 327)ê

4.] The board of hospital trustees or the board of county commissioners may offer the following assistance to members of the staff to attract and retain them:

(a) Establishment of clinic or group practice;

(b) Malpractice insurance coverage under the hospital’s policy of professional liability insurance;

(d) The opportunity to rent office space in facilities owned or operated by the hospital, as the space is available, if this opportunity is offered to all members of the staff on the same terms and conditions.

Sec. 3. NRS 41.500 is hereby amended to read as follows:

41.500 1. Except as otherwise provided in NRS 41.505, any person in this State who renders emergency care or assistance in an emergency, gratuitously and in good faith, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by him in rendering the emergency care or assistance or as a result of any act or failure to act, not amounting to gross negligence, to provide or arrange for further medical treatment for the injured person.

2. Any person in this State who acts as a driver of an ambulance or attendant on an ambulance operated by a volunteer service or as a volunteer driver or attendant on an ambulance operated by a political subdivision of this State, or owned by the Federal Government and operated by a contractor of the Federal Government, and who in good faith renders emergency care or assistance to any injured or ill person, whether at the scene of an emergency or while transporting an injured or ill person to or from any clinic, doctor’s office or other medical facility, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by him in rendering the emergency care or assistance, or as a result of any act or failure to act, not amounting to gross negligence, to provide or arrange for further medical treatment for the injured or ill person.

3. Any appointed member of a volunteer service operating an ambulance or an appointed volunteer serving on an ambulance operated by a political subdivision of this State, other than a driver or attendant, of an ambulance, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by him whenever he is performing his duties in good faith.

4. Any person who is a member of a search and rescue organization in this State under the direct supervision of any county sheriff who in good faith renders care or assistance in an emergency to any injured or ill person, whether at the scene of an emergency or while transporting an injured or ill person to or from any clinic, doctor’s office or other medical facility, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by him in rendering the emergency care or assistance, or as a result of any act or failure to act, not amounting to gross negligence, to provide or arrange for further medical treatment for the injured or ill person.

5. Any person who is employed by or serves as a volunteer for a public fire-fighting agency and who is authorized pursuant to chapter 450B of NRS to render emergency medical care at the scene of an emergency is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by that person in rendering that care or as a result of any act or failure to act, not amounting to gross negligence, to provide or arrange for further medical treatment for the injured or ill person.

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ê2005 Statutes of Nevada, Page 2559 (CHAPTER 492, AB 327)ê

6. Any person who:

(a) Has successfully completed a course in cardiopulmonary resuscitation according to the guidelines of the American National Red Cross or American Heart Association;

(b) Has successfully completed the training requirements of a course in basic emergency care of a person in cardiac arrest conducted in accordance with the standards of the American Heart Association; or

(c) Is directed by the instructions of a dispatcher for an ambulance, air ambulance or other agency that provides emergency medical services before its arrival at the scene of the emergency,

Ê and who in good faith renders cardiopulmonary resuscitation in accordance with his training or the direction, other than in the course of his regular employment or profession, is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by that person in rendering that care.

7. For the purposes of subsection 6, a person who:

(a) Is required to be certified in the administration of cardiopulmonary resuscitation pursuant to NRS 391.092; and

(b) In good faith renders cardiopulmonary resuscitation on the property of a public school or in connection with a transportation of pupils to or from a public school or while on activities that are part of the program of a public school,

Ê shall be presumed to have acted other than in the course of his regular employment or profession.

8. Any person who [:

(a) Has successfully completed a course in cardiopulmonary resuscitation and training in the operation and use of an automated external defibrillator that were conducted in accordance with the standards of the American Heart Association or the American National Red Cross; and

(b) Gratuitously] gratuitously and in good faith renders emergency medical care involving the use of an automated external defibrillator [in accordance with his training,

Ê] is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by that person in rendering that care.

9. [A person or governmental entity that provided the requisite training set forth in subsection 8 to a person who renders emergency care in accordance with subsection 8 is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by the person rendering such care.

10.] A business or organization that has placed an automated external defibrillator for use on its premises is not liable for any civil damages as a result of any act or omission, not amounting to gross negligence, by the person rendering such care or for providing the automated external defibrillator to the person for the purpose of rendering such care if the business or organization:

(a) Complies with all current federal and state regulations governing the use and placement of an automated external defibrillator;

(b) [Ensures that only a person who has at least the qualifications set forth in subsection 8 uses the automated external defibrillator to provide care;

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ê2005 Statutes of Nevada, Page 2560 (CHAPTER 492, AB 327)ê

(c)] Ensures that the automated external defibrillator is maintained and tested according to the operational guidelines established by the manufacturer; and

[(d) Establishes and maintains a program to ensure compliance with current regulations, requirements for training,]

(c) Establishes requirements for the notification of emergency medical assistance and guidelines for the maintenance of the equipment.

10. As used in this section, “gratuitously” means that the person receiving care or assistance is not required or expected to pay any compensation or other remuneration for receiving the care or assistance.

Sec. 4. 1. This act becomes effective on July 1, 2005.

2. The amendatory provisions of section 3 of this act apply only to a cause of action that accrues on or after July 1, 2005.

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CHAPTER 493, SB 62

Senate Bill No. 62–Senator Rhoads

CHAPTER 493

AN ACT relating to water; clarifying provisions governing the duties of the State Engineer concerning water rights; revising the provisions concerning the approval or rejection of an application to change the point of diversion of water in certain circumstances; creating a fund to be used to protect existing water rights; eliminating the Division of Water Planning of the State Department of Conservation and Natural Resources; creating the Water Planning Section of the Division of Water Resources of the Department; transferring the former duties of the Division of Water Planning to the Water Planning Section; making an appropriation; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. NRS 533.024 is hereby amended to read as follows:

533.024 The Legislature declares that [it] :

1. It is the policy of this State:

[1.] (a) To encourage and promote the use of effluent, where that use is not contrary to the public health, safety or welfare, and where that use does not interfere with federal obligations to deliver water of the Colorado River.

[2.] (b) To recognize the importance of domestic wells as appurtenances to private homes, to create a protectible interest in such wells and to protect their supply of water from unreasonable adverse effects which are caused by municipal, quasi-municipal or industrial uses and which cannot reasonably be mitigated.

2. The procedures in this chapter for changing the place of diversion, manner of use or place of use of water, and for confirming a report of conveyance, are not intended to have the effect of quieting title to or changing ownership of a water right and that only a court of competent jurisdiction has the power to determine conflicting claims to ownership of a water right.

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ê2005 Statutes of Nevada, Page 2561 (CHAPTER 493, SB 62)ê

jurisdiction has the power to determine conflicting claims to ownership of a water right.

Sec. 2. NRS 533.360 is hereby amended to read as follows:

533.360 1. Except as otherwise provided in subsection 4, NRS 533.345 and subsection [4] 5 of NRS 533.370, when an application is filed in compliance with this chapter, the State Engineer shall, within 30 days, publish or cause to be published once a week for 4 consecutive weeks in a newspaper of general circulation and printed and published in the county where the water is sought to be appropriated, a notice of the application which sets forth:

(a) That the application has been filed.

(b) The date of the filing.

(d) The name of the source from which the appropriation is to be made.

(e) The location of the place of diversion, described by legal subdivision or metes and bounds and by a physical description of that place of diversion.

(f) The purpose for which the water is to be appropriated.

Ê The publisher shall add thereto the date of the first publication and the date of the last publication.

2. Except as otherwise provided in subsection 4, proof of publication must be filed within 30 days after the final day of publication. The State Engineer shall pay for the publication from the application fee. If the application is cancelled for any reason before publication, the State Engineer shall return to the applicant that portion of the application fee collected for publication.

3. If the application is for a proposed well:

(a) For municipal, quasi-municipal or industrial use; and

(b) Whose reasonably expected rate of diversion is one-half cubic foot per second or more,

Ê the applicant shall mail a copy of the notice of application to each owner of real property containing a domestic well that is within 2,500 feet of the proposed well, to his address as shown in the latest records of the county assessor. If there are not more than six such wells, notices must be sent to each owner by certified mail, return receipt requested. If there are more than six such wells, at least six notices must be sent to owners by certified mail, return receipt requested. The return receipts from these notices must be filed with the State Engineer before he may consider the application.

4. The provisions of this section do not apply to an environmental permit.

Sec. 3. NRS 533.370 is hereby amended to read as follows:

533.370 1. Except as otherwise provided in this section and NRS 533.345, 533.371, 533.372 and 533.503, the State Engineer shall approve an application submitted in proper form which contemplates the application of water to beneficial use if:

(a) The application is accompanied by the prescribed fees;

(b) The proposed use or change, if within an irrigation district, does not adversely affect the cost of water for other holders of water rights in the district or lessen the efficiency of the district in its delivery or use of water; and

(1) His intention in good faith to construct any work necessary to apply the water to the intended beneficial use with reasonable diligence; and

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ê2005 Statutes of Nevada, Page 2562 (CHAPTER 493, SB 62)ê

(2) His financial ability and reasonable expectation actually to construct the work and apply the water to the intended beneficial use with reasonable diligence.

2. Except as otherwise provided in this subsection and [subsection 7,] and subsections 3 and 8, the State Engineer shall approve or reject each application within 1 year after the final date for filing a protest. The State Engineer may:

(a) Postpone action upon written authorization to do so by the applicant or, if an application is protested, by the protestant and the applicant.

(b) Postpone action if the purpose for which the application was made is municipal use.

(c) In areas where studies of water supplies have been determined to be necessary by the State Engineer pursuant to NRS 533.368 or where court actions are pending, withhold action until it is determined there is unappropriated water or the court action becomes final.

3. Except as otherwise provided in subsection 8, the State Engineer shall approve or reject, within 6 months after the final date for filing a protest, an application filed to change the point of diversion of water already appropriated when the existing and proposed points of diversion are on the same property for which the water has already been appropriated under the existing water right or the proposed point of diversion is on real property that is proven to be owned by the applicant and is contiguous to the place of use of the existing water right. The State Engineer may:

(a) Postpone action upon written authorization to do so by the applicant or, if the application is protested, by the protestant and the applicant.

(b) In areas where studies of water supplies have been determined to be necessary by the State Engineer pursuant to NRS 533.368 or where court actions are pending, withhold action until it is determined there is unappropriated water or the court action becomes final.

4. If the State Engineer does not act upon an application within 1 year after the final date for filing a protest, the application remains active until acted upon by the State Engineer.

[4.] 5. Except as otherwise provided in subsection [7,] 8, where there is no unappropriated water in the proposed source of supply, or where its proposed use or change conflicts with existing rights or with protectible interests in existing domestic wells as set forth in NRS 533.024, or threatens to prove detrimental to the public interest, the State Engineer shall reject the application and refuse to issue the requested permit. If a previous application for a similar use of water within the same basin has been rejected on those grounds, the new application may be denied without publication.

[5.] 6. In determining whether an application for an interbasin transfer of groundwater must be rejected pursuant to this section, the State Engineer shall consider:

(a) Whether the applicant has justified the need to import the water from another basin;

(b) If the State Engineer determines that a plan for conservation of water is advisable for the basin into which the water is to be imported, whether the applicant has demonstrated that such a plan has been adopted and is being effectively carried out;

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ê2005 Statutes of Nevada, Page 2563 (CHAPTER 493, SB 62)ê

(d) Whether the proposed action is an appropriate long-term use which will not unduly limit the future growth and development in the basin from which the water is exported; and

(e) Any other factor the State Engineer determines to be relevant.

[6.] 7. If a hearing is held regarding an application, the decision of the State Engineer must be in writing and include findings of fact, conclusions of law and a statement of the underlying facts supporting the findings of fact. The written decision may take the form of a transcription of an oral ruling. The rejection or approval of an application must be endorsed on a copy of the original application, and a record must be made of the endorsement in the records of the State Engineer. The copy of the application so endorsed must be returned to the applicant. Except as otherwise provided in subsection [8,] 9, if the application is approved, the applicant may, on receipt thereof, proceed with the construction of the necessary works and take all steps required to apply the water to beneficial use and to perfect the proposed appropriation. If the application is rejected, the applicant may take no steps toward the prosecution of the proposed work or the diversion and use of the public water while the rejection continues in force.

[7.] 8. The provisions of subsections 1 to [5,] 6, inclusive, do not apply to an application for an environmental permit.

[8.] 9. The provisions of subsection [6] 7 do not authorize the recipient of an approved application to use any state land administered by the Division of State Lands of the State Department of Conservation and Natural Resources without the appropriate authorization for that use from the State Land Registrar.

[9.] 10. As used in this section, “interbasin transfer of ground water” means a transfer of groundwater for which the proposed point of diversion is in a different basin than the proposed place of beneficial use.

Sec. 4. NRS 533.386 is hereby amended to read as follows:

533.386 1. The State Engineer shall confirm that the report of conveyance required by paragraph (a) of subsection 1 of NRS 533.384 includes all material required by that subsection and that:

(a) The report is accompanied by the prescribed fee;

(b) No conflict exists in the chain of title that can be determined by the State Engineer from the conveyance documents or [from] other information on file in the Office of the State Engineer; and

(c) The State Engineer is able to determine the rate of diversion and the amount of water conveyed in acre-feet or million gallons from the conveyance documents or [from] other information on file in the Office of the State Engineer.

2. If the State Engineer confirms a report of conveyance pursuant to subsection 1, he shall in a timely manner provide a notice of the confirmation to the person who submitted the report of conveyance. The notice must include, without limitation [, a] :

(a) A statement indicating that neither the confirmation of the report of conveyance nor the report of conveyance, if the report sets forth the amount of water conveyed, guarantees that:

[(a)] (1) The water right is in good standing with the Office of the State Engineer; or

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[(b)] (2) The amount of water referenced in the notice or in the report of conveyance is the actual amount of water that a person is entitled to use upon conveyance of the application or permit to appropriate any of the public waters, the certificate of appropriation, the adjudicated or unadjudicated water right, or the application or permit to change the place of diversion, manner of use or place of use of water.

(b) A statement that the confirmation of the report of conveyance is not a determination of ownership and that only a court of competent jurisdiction may adjudicate conflicting claims to ownership of a water right.

3. If the State Engineer determines that the report of conveyance is deficient, he shall reject the report of conveyance and return it to the person who submitted it , together with:

(a) An explanation of the deficiency; and

(b) A notice stating that the State Engineer will not confirm a report of conveyance that has been rejected unless the report is resubmitted with the material required to cure the deficiency. The notice must also include a statement of the provisions of subsection [4.] 5.

4. If, from the conveyance documents or other information in the Office of the State Engineer, it appears to the State Engineer that there is a conflict in the chain of title, the State Engineer shall reject the report of conveyance and return it to the person who submitted it, together with:

(a) An explanation that a conflict appears to exist in the chain of title; and

(b) A notice stating that the State Engineer will not take further action with respect to the report of conveyance until a court of competent jurisdiction has determined the conflicting claims to ownership of the water right and the determination has become final or until a final resolution of the conflicting claims has otherwise occurred. The notice must also include a statement of the provisions of subsection 5.

5. The State Engineer shall not consider or treat the person to whom:

(a) An application or permit to appropriate any of the public waters;

(b) A certificate of appropriation;

(d) An application or permit to change the place of diversion, manner of use or place of use of water,

Ê is conveyed as the owner or holder of the application, right, certificate or permit for the purposes of this chapter, including, without limitation, all advisements and other notices required of the State Engineer and the granting of permits to change the place of diversion, manner of use or place of use of water, until a report of the conveyance is confirmed pursuant to subsection 1.

6. If the State Engineer is notified that a court of competent jurisdiction has entered a judgment confirming ownership of a water right or resolving a conflict in a chain of title, and that the judgment has become final, the State Engineer shall take such administrative action as is appropriate or necessary to conform the records of the Office of the State Engineer with the judgment of the court, including, without limitation, amending or withdrawing a permit or certificate that was previously approved by the State Engineer.

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ê2005 Statutes of Nevada, Page 2565 (CHAPTER 493, SB 62)ê

Sec. 5. Chapter 534 of NRS is hereby amended by adding thereto a new section to read as follows:

1. There is hereby created in the State Treasury a fund to be designated as the Water Rights Technical Support Fund to be administered by the Board for Financing Water Projects.

2. The Water Rights Technical Support Fund is a continuing fund without reversion. Money in the Fund must be invested as the money in other funds is invested. The interest and income earned on the money in the Fund, after deducting any applicable charges, must be credited to the Fund. Claims against the Fund must be paid as other claims against the State are paid.

3. The Board for Financing Water Projects may accept gifts, grants and donations from any source for deposit in the Water Rights Technical Support Fund.

4. Except as otherwise provided in subsection 5, money in the Water Rights Technical Support Fund must be used by the Board for Financing Water Projects only to make grants to a local government to:

(a) Obtain and provide expert and technical assistance to gather data to protect its existing water rights; or

(b) Fund projects to enhance or protect its existing water rights.

5. Any grant of money from the Water Rights Technical Support Fund must not be used by a local government to pay for any assistance or projects as set forth in subsection 4 if the only purpose of the assistance or project is to obtain evidence, including, without limitation, technical evidence and oral testimony or to pay for expert witnesses or attorney’s fees for or in anticipation of any administrative or judicial proceeding, including, without limitation, hearings before the State Engineer or in any state or federal court.

Sec. 6. NRS 538.171 is hereby amended to read as follows:

538.171 1. The Commission shall receive, protect and safeguard and hold in trust for the State of Nevada all water and water rights, and all other rights, interests or benefits in and to the waters described in NRS 538.041 to 538.251, inclusive, and to the power generated thereon, held by or which may accrue to the State of Nevada under and by virtue of any Act of the Congress of the United States or any agreements, compacts or treaties to which the State of Nevada may become a party, or otherwise.

2. Except as otherwise provided in this subsection, applications for the original appropriation of such waters, or to change the place of diversion, manner of use or place of use of water covered by the original appropriation, must be made to the Commission in accordance with the regulations of the Commission. In considering such an application, the Commission shall use the criteria set forth in subsection [4] 6 of NRS 533.370. The Commission’s action on the application constitutes the recommendation of the State of Nevada to the United States for the purposes of any federal action on the matter required by law. The provisions of this subsection do not apply to supplemental water.

3. The Commission shall furnish to the State Engineer a copy of all agreements entered into by the Commission concerning the original appropriation and use of such waters. It shall also furnish to the State Engineer any other information it possesses relating to the use of water from the Colorado River which the State Engineer deems necessary to allow him to act on applications for permits for the subsequent appropriation of these waters after they fall within the State Engineer’s jurisdiction.

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ê2005 Statutes of Nevada, Page 2566 (CHAPTER 493, SB 62)ê

to act on applications for permits for the subsequent appropriation of these waters after they fall within the State Engineer’s jurisdiction.

4. Notwithstanding any provision of chapter 533 of NRS, any original appropriation and use of the waters described in subsection 1 by the Commission or by any entity to whom or with whom the Commission has contracted the water is not subject to regulation by the State Engineer.

Sec. 7. Chapter 540 of NRS is hereby amended by adding thereto a new section to read as follows:

1. The Section consists of the Chief and any other necessary personnel.

2. The Chief is appointed by the State Engineer and is in the unclassified service of the State.

Sec. 8. NRS 540.021 is hereby amended to read as follows:

540.021 As used in this chapter:

1. [“Administrator”] “Chief” means the [Administrator] Chief of the [Division.] Section.

2. “Department” means the State Department of Conservation and Natural Resources.

3. “Division” means the Division of Water [Planning in the State Department of Conservation and Natural Resources.] Resources of the Department.

4. “Section” means the Water Planning Section of the Division.

Sec. 9. NRS 540.031 is hereby amended to read as follows:

540.031 The [Division of] Water Planning Section of the [State Department of Conservation and Natural Resources] Division is hereby created.

Sec. 10. NRS 540.041 is hereby amended to read as follows:

540.041 1. The [Administrator:] Chief:

(a) Must be selected with special reference to his training, experience, capability and interest in the field of water resource planning.

(b) [Except as otherwise provided in NRS 284.143, shall devote his entire time and attention to the business of his office and shall not pursue any other business or occupation or hold any other office of profit.

(c)] Shall coordinate the activities of the [Division.] Section.

2. The [Administrator] Chief is responsible for the administration of all provisions of law relating to the functions of the [Division.] Section.

3. The [Administrator] Chief, with the approval of the State Engineer, may employ, within the limits of legislative appropriations, such staff as is necessary to the performance of his duties.

4. The [Administrator] Chief, through the State Engineer, shall, not later than the fifth calendar day of each regular session of the Legislature, submit to the Director of the Legislative Counsel Bureau for distribution to the Legislature a written report summarizing the actions of the [Division] Section taken pursuant to the provisions of NRS 540.051 [and 540.101] during the preceding biennium.

Sec. 11. NRS 540.051 is hereby amended to read as follows:

540.051 The [Division] Section shall:

1. [Provide political subdivisions and private enterprises in arid regions with information, alternatives and recommendations bearing upon regional shortages of water including feasible selections or courses of planning and action for acquiring additional water or for conserving water now available, or both.

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ê2005 Statutes of Nevada, Page 2567 (CHAPTER 493, SB 62)ê

2.] Include in its planning:

(a) [The investigation of new sources of water such as desalinization, importation and conservation, and means of transporting existing water;

(b)] Recognition and protection of existing water rights consistent with chapters 533 and 534 of NRS; and

[(c)] (b) Consideration of the factors relating to the quality of water in this State and the importance of considering the issues of quantity and quality simultaneously, but the State Environmental Commission and Division of Environmental Protection of the [State Department of Conservation and Natural Resources] Department retain full responsibility for the management of water quality.

[3. Evaluate previous studies and compile existing information to assist in determining the suitability of potential sites as facilities for the storage of water upstream.

4. Develop forecasts of supply and demand for future needs.

5. Advise the State Department of Conservation and Natural Resources and the Legislature concerning economic and social effects of water policy.

6.] 2. Suggest to the Legislature changes in water policy which may be necessary to meet new requirements of law or of the people of the State.

[7. Cooperate with]

3. Assist the State Engineer in dealings with the Federal Government and other states, but the State Engineer is solely responsible for the allocation of water resources and litigation.

[8. Provide the Board for Financing Water Projects and the Director of the Department of Business and Industry with necessary technical and clerical assistance in financing water projects.]

4. Review local and federal documents regarding water planning that are relevant to the use of water in Nevada, including, without limitation, local water and resource plans. Reviews conducted pursuant to this subsection must consider, without limitation:

(a) The accuracy of information relating to water use and water planning;

(b) Compliance with the water law of this State; and

5. Compile and update summarized data relating to hydrographic basins to support decisions that the State Engineer makes regarding such basins, and provide summarized information regarding such basins to the public. The Section shall cause to be generated and updated a summary for each hydrographic basin to show critical information regarding that basin, including, without limitation:

(a) Whether the basin is designated;

(b) All appurtenant or associated studies related to the availability of water;

(d) The availability of crop and pumpage inventories;

(e) The availability of data regarding water levels; and

(f) Current commitments of water from the basin that are attributable to existing water rights.

Ê The information described in this subsection must, insofar as practicable, be provided in an electronic format and made available on the website of the State Engineer on the Internet or its successor.

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ê2005 Statutes of Nevada, Page 2568 (CHAPTER 493, SB 62)ê

6. Upon request, provide technical assistance to the Board for Financing Water Projects created by NRS 349.957, including, without limitation, the review of letters of intent and applications for grants.

7. Promote water conservation by:

(a) Consulting with suppliers of water concerning:

(1) Community water conservation plans; and

(2) The content and scope of water plans; and

(b) Reviewing plans for compliance with the applicable provisions of NRS 540.121 to 540.151, inclusive.

8. Assist federal, state and local governments and the general public in obtaining information regarding water planning, the availability of water and issues relating to water rights.

9. Support activities in response to drought as provided for under the drought plan established for the State.

10. Administer the statewide program established for the management of floodplains.

11. Upon request, provide updates to local governments on water issues relevant to this State, changes in policy and the availability of new information concerning water resources.

Sec. 12. NRS 540.061 is hereby amended to read as follows:

540.061 It is the intent of the Legislature, in accordance with the state policy set forth in NRS 540.011, to provide for the reporting of all projects to the [Administrator] Chief to ensure effective coordination by the State in its effort to plan water use.

Sec. 13. NRS 540.091 is hereby amended to read as follows:

540.091 1. A local governmental officer or agency that is required to approve a project shall file a report of each project the officer or agency approves on a form provided by the [Administrator.] Chief.

2. Each report of an approved project must include:

(a) The name and mailing address of the owner or developer of the project;

(b) A legal description of the location of the project;

(d) A statement concerning how the water will be supplied; and

(e) If the water is self-supplied, the source of the water and identification of the water rights.

3. A local governmental officer or agency may require the owner or developer of an approved project to fill out the report.

4. The local governmental officer or agency shall file all reports for projects approved during a quarter of a calendar year on or before 15 days after the last day of the quarter. The local governmental officer or agency shall submit a fee with each report in the amount of $75 plus 50 cents per acre-foot of water, or fraction thereof, required by the project. The local governmental officer or agency shall collect the fee from the owner or developer of the project, plus an additional administrative fee of $10 which may be retained by the local government.

5. The [Administrator] Chief shall deposit all fees he receives pursuant to this section with the State Treasurer for credit to the State General Fund.

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ê2005 Statutes of Nevada, Page 2569 (CHAPTER 493, SB 62)ê

Sec. 14. NRS 540.111 is hereby amended to read as follows:

540.111 1. The Advisory Board on Water Resources Planning and Development, consisting of 15 members appointed by the Governor, is hereby created within the Division.

2. The Governor shall appoint to the Advisory Board:

(a) [Six] Five members who are representatives of the governing bodies of the county with the largest population in the State and the cities in that county;

(b) One member who is a representative of the largest water utility in the county with the largest population in the State;

(c) Two members who are representatives of the county with the second largest population in the State and the cities in that county;

(d) One member who is a representative of the largest water utility in the county with the second largest population in the State;

(e) One member who is a representative of the governing body of a county whose population is less than 50,000;

(f) One member who is representative of the general public; and

[(f)] (g) Four members, each of whom represents a different one of the following interests:

(1) Farming;

(2) Mining;

(3) Ranching; and

(4) Wildlife.

Ê The Governor shall make the appointments required by this subsection so that at least [seven] six members of the Advisory Board are residents of the county with the largest population in the State, at least three members are residents of the county with the second largest population in the State and at least [three] four members are residents of a county whose population is less than 100,000.

3. The members of the Advisory Board serve at the pleasure of the Governor.

4. All vacancies on the Advisory Board must be filled in the same manner of appointment as the member who created the vacancy.

5. The members of the Advisory Board are entitled to receive a salary of $60 for each day’s attendance at a meeting of the Advisory Board and the travel and subsistence allowances provided by law for state officers and employees generally.

6. The Advisory Board shall, at its first meeting and annually thereafter, elect a Chairman from among its members.

7. The Advisory Board may meet at least once in each calendar quarter and at other times upon the call of the Chairman or a majority of the members.

8. A majority of the members of the Advisory Board constitutes a quorum. A quorum may exercise all of the powers and duties of the Advisory Board.

9. The Advisory Board shall:

(a) Advise the [Administrator] Chief on matters relating to the planning and development of water resources;

(b) Be informed on and interested in the administrative duties of the [Division] Section and any legislation recommended by the [Division;] Section;

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ê2005 Statutes of Nevada, Page 2570 (CHAPTER 493, SB 62)ê

(c) Advise and make recommendations through the Section and the Division [and the State Department of Conservation and Natural Resources] to the Governor and the Legislature concerning policies for water planning ; and [the development of water resources in this State;]

(d) Advise the [Administrator] Chief concerning the policies of the [Division] Section and areas of emphasis for the planning of water resources . [; and

(e) Review, and provide written recommendations to the Division regarding, the plan developed pursuant to NRS 540.101.]

Sec. 15. NRS 540.131 is hereby amended to read as follows:

540.131 1. Except as otherwise provided in subsection 5, each supplier of water which supplies water for municipal, industrial or domestic purposes shall, on or before July 1, 1992, adopt a plan of water conservation based on the climate and the living conditions of its service area in accordance with the provisions of NRS 540.141 [.] , and shall update the plan pursuant to paragraph (c) of subsection 4. The provisions of the plan must apply only to the supplier’s property and its customers. The supplier of water [may request assistance from the Division to develop the plan.] shall submit the plan to the Section for review by the Section pursuant to subsection 3.

2. As part of the procedure of adopting a plan, the supplier of water shall provide an opportunity for any interested person, including, but not limited to, any private or public entity that supplies water for municipal, industrial or domestic purposes, to submit written views and recommendations on the plan.

3. The plan must be reviewed by the [Division] Section within 30 days after its submission and approved for compliance with this section before it is adopted by the supplier of water.

4. The plan:

(a) Must be available for inspection by members of the public during office hours at the offices of the supplier of water; [and]

(b) May be revised from time to time to reflect the changing needs and conditions of the service area. Each such revision must be made available for inspection by members of the public [.] ; and

5. Suppliers of water:

(a) Who are required to adopt a plan of water conservation pursuant to this section; and

(b) Whose service areas are located in a common geographical area,

Ê may adopt joint plans of water conservation based on the climate and living conditions of that common geographical area. Such a plan must comply with the requirements of this section and NRS 540.141.

6. The board of county commissioners of a county, the governing body of a city and the town board or board of county commissioners having jurisdiction of the affairs of a town shall:

(a) Adopt any ordinances necessary to carry out a plan of conservation adopted pursuant to this section which applies to property within its jurisdiction;

(b) Establish a schedule of fines for the violation of any ordinances adopted pursuant to this subsection; and

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ê2005 Statutes of Nevada, Page 2571 (CHAPTER 493, SB 62)ê

(c) Hire such employees as it deems necessary to enforce the provisions of any ordinances it adopts pursuant to this subsection.

Sec. 16. NRS 540.141 is hereby amended to read as follows:

540.141 1. A plan or joint plan of water conservation submitted to the [Division] Section for review must include provisions relating to:

(a) Methods of public education to:

(1) Increase public awareness of the limited supply of water in this State and the need to conserve water.

(2) Encourage reduction in the size of lawns and encourage the use of plants that are adapted to arid and semiarid climates.

(b) Specific conservation measures required to meet the needs of the service area, including, but not limited to, any conservation measures required by law.

(1) Identify and reduce leakage in water supplies, inaccuracies in water meters and high pressure in water supplies; and

(2) [Increase] Where applicable, increase the reuse of effluent.

(d) A contingency plan for drought conditions that ensures a supply of potable water.

(e) A schedule for carrying out the plan.

(f) Measures to evaluate the effectiveness of the plan.

2. A plan or joint plan submitted for review must be accompanied by an analysis of the feasibility of charging variable rates for the use of water to encourage the conservation of water.

3. The [Division] Section shall review any plan or joint plan submitted to it within 30 days after its submission and approve the plan if it is based on the climate and living conditions of the service area and complies with the requirements of this section.

4. The [Administrator] Chief may exempt wholesale water purveyors from the provisions of this section which do not reasonably apply to wholesale supply.

Sec. 17. NRS 540.151 is hereby amended to read as follows:

540.151 1. Except as otherwise provided in subsection 5, each supplier of water which supplies water for municipal, industrial or domestic purposes shall adopt a plan to provide incentives:

(a) To encourage water conservation in its service area;

(b) To retrofit existing structures with plumbing fixtures designed to conserve the use of water; and

Ê The supplier of water may request assistance from the [Division] Section to develop [the] its plan.

2. As part of the procedure of adopting a plan, the supplier of water shall provide an opportunity for any interested person to submit written views and recommendations on the plan.

3. The supplier of water shall file a copy of the plan with the [Division] Section for informational purposes.

4. The plan:

(a) Must be available for inspection by members of the public during office hours at the offices of the supplier of water; and

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ê2005 Statutes of Nevada, Page 2572 (CHAPTER 493, SB 62)ê

(b) May be revised from time to time to reflect the changing needs and conditions of the service area. Each such revision must be made available for inspection by members of the public.

5. Suppliers of water:

(a) Who are required to adopt a plan for incentives pursuant to this section; and

(b) Whose service areas are located in a common geographical area,

Ê may adopt joint plans.

Sec. 18. NRS 540A.090 is hereby amended to read as follows:

540A.090 In addition to the voting members, the commission includes the following nonvoting members:

1. One member appointed by the Public Utilities Commission of Nevada;

2. One member appointed by the Consumer’s Advocate [for Customers of Public Utilities] of the Bureau of Consumer Protection in the Office of the Attorney General;

3. One member appointed by the Administrator of the Division of Environmental Protection of the State Department of Conservation and Natural Resources;

4. One member appointed by the State Engineer;

5. One member appointed by the [Administrator] Chief of the [Division of] Water Planning Section of the Division of Water Resources of the State Department of Conservation and Natural Resources;

6. One member appointed by the board of directors of the water conservancy district which is largest in area which includes any part of the region;

7. One member appointed by the county or district board of health;

8. One member of the public at large appointed by the affirmative vote of a majority of the voting members; and

9. Additional members with expertise in an area that the majority of the voting members determines is necessary, appointed by the affirmative vote of a majority of the voting members.

Sec. 19. NRS 232.090 is hereby amended to read as follows:

232.090 1. The Department consists of the Director and the following divisions:

(a) The Division of Water Resources.

(b) The Division of State Lands.

(d) The Division of State Parks.

(e) The Division of Conservation Districts.

(f) The Division of Environmental Protection.

(g) [The Division of Water Planning.

(h)] Such other divisions as the Director may from time to time establish.

2. The State Environmental Commission, the State Conservation Commission, the Commission for the Preservation of Wild Horses, the Nevada Natural Heritage Program and the Board to Review Claims are within the Department.

Sec. 20. NRS 232.137 and 540.101 are hereby repealed.

Sec. 21. There is hereby appropriated from the State General Fund to the Water Rights Technical Support Fund, created by section 5 of this act, the sum of $1,000,000.

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ê2005 Statutes of Nevada, Page 2573 (CHAPTER 493, SB 62)ê

Sec. 22. The Legislature declares that it intends by sections 1 and 4 of this act to clarify rather than change the operation of chapter 533 of NRS with respect to the ownership of water rights.

Sec. 23. As soon as practicable after July 1, 2005, the Governor shall:

1. Terminate the appointment of one of the six persons whom the Governor appointed to the Advisory Board on Water Resources Planning and Development pursuant to paragraph (a) of subsection 2 of NRS 540.111. The six existing members of the Board who were appointed pursuant to that paragraph shall draw lots to determine which member’s appointment will be terminated.

2. Appoint to the Advisory Board on Water Resources Planning and Development a new member of the Board who is a representative of the governing body of a county whose population is less than 50,000, as described in paragraph (e) of subsection 2 of NRS 540.111, as amended by this act.

Sec. 24. The Legislative Counsel shall:

1. In preparing the reprint and supplements to the Nevada Revised Statutes, appropriately change any references to an officer, agency or other entity whose name is changed or whose responsibilities are transferred pursuant to the provisions of this act to refer to the appropriate officer, agency or other entity.

2. In preparing supplements to the Nevada Administrative Code, appropriately change any references to an officer, agency or other entity whose name is changed or whose responsibilities are transferred pursuant to the provisions of this act to refer to the appropriate officer, agency or other entity.

Sec. 25. 1. This section and sections 1, 4 and 22 of this act become effective upon passage and approval and apply retroactively.

2. Sections 2, 3 and 5 to 21, inclusive, 23 and 24 of this act become effective on July 1, 2005.

________

CHAPTER 494, SB 325

Senate Bill No. 325–Senator Schneider

CHAPTER 494

AN ACT relating to common-interest communities; requiring persons who act as community managers to hold certificates; requiring persons who conduct studies of the reserves of associations to hold permits; providing for the regulation of such persons by the Commission for Common-Interest Communities; revising provisions governing the management of associations; requiring the Commission to adopt certain regulations relating to associations; making certain technical changes to the organization of the provisions governing common-interest communities; making various other changes related to common-interest communities; providing penalties; and providing other matters properly relating thereto.

[Approved: June 17, 2005]

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ê2005 Statutes of Nevada, Page 2574 (CHAPTER 494, SB 325)ê

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Title 10 of NRS is hereby amended by adding thereto a new chapter to consist of the provisions set forth as sections 2 to 35, inclusive, of this act.

Sec. 2. As used in this chapter, unless the context otherwise requires, the words and terms defined in sections 3 to 14, inclusive, of this act have the meanings ascribed to them in those sections.

Sec. 3. “Administrator” means the Real Estate Administrator.

Sec. 4. “Association” has the meaning ascribed to it in NRS 116.011.

Sec. 5. “Certificate” means a certificate for the management of a common-interest community issued by the Division pursuant to this chapter.

Sec. 6. “Commission” means the Commission for Common-Interest Communities created by NRS 116.600.

Sec. 7. “Common-interest community” has the meaning ascribed to it in NRS 116.021.

Sec. 8. “Community manager” means a person who provides for or otherwise engages in the management of a common-interest community.

Sec. 9. “Division” means the Real Estate Division of the Department of Business and Industry.

Sec. 10. “Executive board” has the meaning ascribed to it in NRS 116.045.

Sec. 11. “Hearing panel” means a hearing panel appointed by the Commission pursuant to section 32 of this act.

Sec. 12. “Management of a common-interest community” means the physical, administrative or financial maintenance and management of a common-interest community, or the supervision of those activities, for a fee, commission or other valuable consideration.

Sec. 13. “Permit” means a permit to conduct a study of the reserves of an association pursuant to NRS 116.31152 issued by the Division pursuant to this chapter.

Sec. 14. “Reserve study specialist” means a person who conducts a study of the reserves of an association pursuant to NRS 116.31152.

Sec. 15. 1. The provisions of this chapter must be administered by the Division, subject to the administrative supervision of the Director of the Department of Business and Industry.

2. The Commission and the Division may do all things necessary and convenient to carry out the provisions of this chapter, including, without limitation, prescribing such forms and adopting such procedures as are necessary to carry out the provisions of this chapter.

3. The Commission or the Administrator, with the approval of the Commission, may adopt such regulations as are necessary to carry out the provisions of this chapter.

4. The Commission may by regulation delegate any authority conferred upon it by the provisions of this chapter to the Administrator to be exercised pursuant to the regulations adopted by the Commission.

5. When regulations are proposed by the Administrator, in addition to other notices required by law, the Administrator shall provide copies of the proposed regulations to the Commission not later than 30 days before the next meeting of the Commission.

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ê2005 Statutes of Nevada, Page 2575 (CHAPTER 494, SB 325)ê

next meeting of the Commission. The Commission shall approve, amend or disapprove any proposed regulations at that meeting.

6. All regulations adopted by the Commission, or adopted by the Administrator with the approval of the Commission, must be published by the Division, posted on its website and offered for sale at a reasonable fee.

7. The Division may publish or supply a reference manual or study guide for community managers and for reserve study specialists and may offer such documents for sale at a reasonable fee.

Sec. 16. 1. Except as otherwise provided in this section and within the limits of legislative appropriations, the Division may employ experts, attorneys, investigators, consultants and other personnel as are necessary to carry out the provisions of this chapter.

2. The Attorney General shall act as the attorney for the Division in all actions and proceedings brought against or by the Division pursuant to the provisions of this chapter.

3. The Attorney General shall render to the Commission and the Division opinions upon all questions of law relating to the construction or interpretation of this chapter, or arising in the administration thereof, that may be submitted to him by the Commission or the Division.

Sec. 17. The Division shall maintain in each district office a public docket or other record in which it shall record, from time to time as made:

1. The rulings or decisions upon all complaints filed with that district office.

2. All investigations instituted by that district office in the first instance, upon or in connection with which any hearing has been held, or in which the person charged has made no defense.

3. Denials of applications made to that district office for examination or issuance of a certificate or permit.

Sec. 18. 1. Except as otherwise provided in this section, a complaint filed with the Division alleging a violation of this chapter or chapter 116 of NRS, all documents and other information filed with the complaint and all documents and other information compiled as a result of an investigation conducted to determine whether to initiate disciplinary action are confidential.

2. The complaint or other charging documents filed with the Commission to initiate disciplinary action and all documents and other information considered by the Commission or a hearing panel when determining whether to impose discipline are public records.

Sec. 19. The Commission and its members, each hearing panel and its members, the Administrator, the Division, and the experts, attorneys, investigators, consultants and other personnel of the Commission and the Division are immune from any civil liability for any decision or action taken in good faith and without malicious intent in carrying out the provisions of this chapter.

Sec. 20. Any notice or other information that is required to be served upon the Commission pursuant to the provisions of this chapter may be delivered to the principal office of the Division.

Sec. 21. 1. The Administrator may adopt regulations which establish procedures for the Division to conduct business electronically pursuant to title 59 of NRS with persons who are regulated pursuant to this chapter and with any other persons with whom the Division conducts business. The regulations may include, without limitation, the establishment of fees to pay the costs of conducting business electronically with the Division.

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establishment of fees to pay the costs of conducting business electronically with the Division.

2. In addition to the process authorized by NRS 719.280, if the Division is conducting business electronically with a person and a law requires a signature or record to be notarized, acknowledged, verified or made under oath, the Division may allow the person to substitute a declaration that complies with the provisions of NRS 53.045 to satisfy the legal requirement.

3. The Division may refuse to conduct business electronically with a person who has failed to pay money which the person owes to the Division or the Commission.

Sec. 22. 1. Except as otherwise provided in subsection 2, all money received by the Commission, a hearing panel or the Division pursuant to this chapter must be deposited into the Account for Common-Interest Communities created pursuant to NRS 116.630.

2. If the Commission imposes a fine or penalty, the Commission shall deposit the money collected from the imposition of the fine or penalty with the State Treasurer for credit to the State General Fund. If the money is so deposited, the Commission may present a claim to the State Board of Examiners for recommendation to the Interim Finance Committee if money is required to pay attorney’s fees or the costs of an investigation, or both.

3. Money for the support of the Commission and Division in carrying out the provisions of this chapter must be provided by direct legislative appropriation and be paid out on claims as other claims against the State are paid.

Sec. 23. 1. Except as otherwise provided in this section, a person shall not act as a community manager unless the person holds a certificate.

2. The Commission shall by regulation provide for the standards of practice for community managers who hold certificates.

3. The Division may investigate any community manager who holds a certificate to ensure that the community manager is complying with the provisions of this chapter and chapter 116 of NRS and the standards of practice adopted by the Commission.

4. In addition to any other remedy or penalty, if the Commission or a hearing panel, after notice and hearing, finds that a community manager who holds a certificate has violated any provision of this chapter or chapter 116 of NRS or any of the standards of practice adopted by the Commission, the Commission or the hearing panel may take appropriate disciplinary action against the community manager.

5. In addition to any other remedy or penalty, the Commission may:

(a) Refuse to issue a certificate to a person who has failed to pay money which the person owes to the Commission or the Division.

(b) Suspend, revoke or refuse to renew the certificate of a person who has failed to pay money which the person owes to the Commission or the Division.

6. The provisions of this section do not apply to:

(a) A financial institution that is engaging in an activity permitted by law.

(b) An attorney who is licensed to practice in this State and who is acting in that capacity.

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(d) A receiver with respect to property subject to the receivership.

(e) A member of an executive board or an officer of an association who is acting solely within the scope of his duties as a member of the executive board or an officer of the association.

Sec. 24. 1. The Commission shall by regulation provide for the issuance by the Division of certificates. The regulations:

(a) Must establish the qualifications for the issuance of such a certificate, including, without limitation, the education and experience required to obtain such a certificate.

(b) May require applicants to pass an examination in order to obtain a certificate. If the regulations require such an examination, the Commission shall by regulation establish fees to pay the costs of the examination, including any costs which are necessary for the administration of the examination.

(c) May require an investigation of an applicant’s background. If the regulations require such an investigation, the Commission shall by regulation establish fees to pay the costs of the investigation.

(d) Must establish the grounds for initiating disciplinary action against a person to whom a certificate has been issued, including, without limitation, the grounds for placing conditions, limitations or restrictions on a certificate and for the suspension or revocation of a certificate.

(e) Must establish rules of practice and procedure for conducting disciplinary hearings.

2. The Division may collect a fee for the issuance of a certificate in an amount not to exceed the administrative costs of issuing the certificate.

Sec. 25. 1. Except as otherwise provided in this section, a person shall not act as a reserve study specialist unless the person holds a permit.

2. The Commission shall by regulation provide for the standards of practice for reserve study specialists who hold permits.

3. The Division may investigate any reserve study specialist who holds a permit to ensure that the reserve study specialist is complying with the provisions of this chapter and chapter 116 of NRS and the standards of practice adopted by the Commission.

4. In addition to any other remedy or penalty, if the Commission or a hearing panel, after notice and hearing, finds that a reserve study specialist who holds a permit has violated any provision of this chapter or chapter 116 of NRS or any of the standards of practice adopted by the Commission, the Commission or the hearing panel may take appropriate disciplinary action against the reserve study specialist.

5. In addition to any other remedy or penalty, the Commission may:

(a) Refuse to issue a permit to a person who has failed to pay money which the person owes to the Commission or the Division.

(b) Suspend, revoke or refuse to renew the permit of a person who has failed to pay money which the person owes to the Commission or the Division.

6. The provisions of this section do not apply to a member of an executive board or an officer of an association who is acting solely within the scope of his duties as a member of the executive board or an officer of the association.

Sec. 26. 1. The Commission shall by regulation provide for the issuance by the Division of permits to reserve study specialists. The regulations:

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(a) Must establish the qualifications for the issuance of such a permit, including, without limitation, the education and experience required to obtain such a permit.

(b) May require applicants to pass an examination in order to obtain a permit. If the regulations require such an examination, the Commission shall by regulation establish fees to pay the costs of the examination, including any costs which are necessary for the administration of the examination.

(d) Must establish the grounds for initiating disciplinary action against a person to whom a permit has been issued, including, without limitation, the grounds for placing conditions, limitations or restrictions on a permit and for the suspension or revocation of a permit.

(e) Must establish rules of practice and procedure for conducting disciplinary hearings.

2. The Division may collect a fee for the issuance of a permit in an amount not to exceed the administrative costs of issuing the permit.

Sec. 27. 1. An applicant for a certificate or permit shall submit to the Division:

(a) The social security number of the applicant; and

(b) The statement prescribed by the Welfare Division of the Department of Human Resources pursuant to NRS 425.520. The statement must be completed and signed by the applicant.

2. The Division shall include the statement required pursuant to subsection 1 in:

(a) The application or any other forms that must be submitted for the issuance of the certificate or permit; or

(b) A separate form prescribed by the Division.

3. A certificate or permit may not be issued if the applicant:

(a) Fails to submit the statement required pursuant to subsection 1; or

(b) Indicates on the statement submitted pursuant to subsection 1 that he is subject to a court order for the support of a child and is not in compliance with the order or a plan approved by the district attorney or other public agency enforcing the order for the repayment of the amount owed pursuant to the order.

4. If an applicant indicates on the statement submitted pursuant to subsection 1 that he is subject to a court order for the support of a child and is not in compliance with the order or a plan approved by the district attorney or other public agency enforcing the order for the repayment of the amount owed pursuant to the order, the Division shall advise the applicant to contact the district attorney or other public agency enforcing the order to determine the actions that the applicant may take to satisfy the arrearage.

Sec. 28. 1. If the Division receives a copy of a court order issued pursuant to NRS 425.540 that provides for the suspension of all professional, occupational and recreational licenses, certificates and permits issued to the holder of a certificate or permit, the Division shall deem the certificate or permit to be suspended at the end of the 30th day after the date the court order was issued unless the Division receives a letter issued to the holder of the certificate or permit by the district attorney or other public agency pursuant to NRS 425.550 stating that the holder of the certificate or permit has complied with a subpoena or warrant or has satisfied the arrearage pursuant to NRS 425.560.

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or other public agency pursuant to NRS 425.550 stating that the holder of the certificate or permit has complied with a subpoena or warrant or has satisfied the arrearage pursuant to NRS 425.560.

2. The Division shall reinstate a certificate or permit that has been suspended by a district court pursuant to NRS 425.540 if the Division receives a letter issued by the district attorney or other public agency pursuant to NRS 425.550 to the holder of the certificate or permit that he has complied with the subpoena or warrant or has satisfied the arrearage pursuant to NRS 425.560.

Sec. 29. The expiration or revocation of a certificate or permit by operation of law or by order or decision of any agency or court of competent jurisdiction, or the voluntary surrender of such a certificate or permit by the holder of the certificate or permit does not:

1. Prohibit the Commission or the Division from initiating or continuing an investigation of, or action or disciplinary proceeding against, the holder of the certificate or permit as authorized pursuant to the provisions of this chapter or chapter 116 of NRS or the regulations adopted pursuant thereto; or

2. Prevent the imposition or collection of any fine or penalty authorized pursuant to the provisions of this chapter or chapter 116 of NRS or the regulations adopted pursuant thereto against the holder of the certificate or permit.

Sec. 30. 1. To carry out the purposes of this chapter, the Commission, or any member thereof acting on behalf of the Commission or acting on behalf of a hearing panel, may issue subpoenas to compel the attendance of witnesses and the production of books, records and other papers.

2. If any person fails to comply with a subpoena issued by the Commission or any member thereof pursuant to this section within 20 days after the date of service of the subpoena, the Commission may petition the district court for an order of the court compelling compliance with the subpoena.

3. Upon such a petition, the court shall enter an order directing the person subpoenaed to appear before the court at a time and place to be fixed by the court in its order, the time to be not more than 20 days after the date of service of the order, and show cause why he has not complied with the subpoena. A certified copy of the order must be served upon the person subpoenaed.

4. If it appears to the court that the subpoena was regularly issued by the Commission or any member thereof pursuant to this section, the court shall enter an order compelling compliance with the subpoena, and upon failure to obey the order the person must be dealt with as for contempt of court.

Sec. 31. 1. Each witness who is subpoenaed and appears at a hearing is entitled to receive for his attendance the same fees and mileage allowed by law to a witness in a civil case.

2. The fees and mileage for the witness:

(a) Must be paid by the party at whose request the witness is subpoenaed; or

(b) If the appearance of the witness is not requested by any party but the witness is subpoenaed at the request of the Commission or a hearing panel, must be paid by the Division.

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Sec. 32. 1. The Commission may appoint one or more hearing panels. Each hearing panel must consist of one or more independent hearing officers.

2. The Commission may by regulation delegate to one or more hearing panels the power of the Commission to conduct hearings and other proceedings, determine violations, impose fines and penalties and take other disciplinary action authorized by the provisions of this chapter.

3. While acting under the authority of the Commission, a hearing panel and its members are entitled to all privileges and immunities and are subject to all duties and requirements of the Commission and its members.

4. A final order of a hearing panel:

(a) May be appealed to the Commission if, not later than 20 days after the date that the final order is issued by the hearing panel, any party aggrieved by the final order files a written notice of appeal with the Commission.

(b) Must be reviewed and approved by the Commission if, not later than 40 days after the date that the final order is issued by the hearing panel, the Division, upon the direction of the Chairman of the Commission, provides written notice to all parties of the intention of the Commission to review the final order.

Sec. 33. The Commission or a hearing panel may conduct a hearing by means of an audio or video teleconference to one or more locations if the audio or video technology used at the hearing provides the persons present at each location with the ability to hear and communicate with the persons present at each other location.

Sec. 34. 1. In addition to any other remedy or penalty, the Commission may impose an administrative fine against any person who knowingly:

(a) Engages or offers to engage in any activity for which a certificate or permit is required pursuant to this chapter or chapter 116 of NRS, or any regulation adopted pursuant thereto, if the person does not hold the required certificate or permit or has not been given the required authorization; or

(b) Assists or offers to assist another person to commit a violation described in paragraph (a).

2. If the Commission imposes an administrative fine against a person pursuant to this section, the amount of the administrative fine may not exceed the amount of any gain or economic benefit that the person derived from the violation or $5,000, whichever amount is greater.

3. In determining the appropriate amount of the administrative fine, the Commission shall consider:

(a) The severity of the violation and the degree of any harm that the violation caused to other persons;

(b) The nature and amount of any gain or economic benefit that the person derived from the violation;

(d) Any other facts or circumstances that the Commission deems to be relevant.

4. Before the Commission may impose the administrative fine, the Commission must provide the person with notice and an opportunity to be heard.

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5. The person is entitled to judicial review of the decision of the Commission in the manner provided by chapter 233B of NRS.

6. The provisions of this section do not apply to a person who engages or offers to engage in activities within the purview of this chapter or chapter 116 of NRS if:

(a) A specific statute exempts the person from complying with the provisions of this chapter or chapter 116 of NRS with regard to those activities; and

(b) The person is acting in accordance with the exemption while engaging or offering to engage in those activities.

Sec. 35. 1. If the Commission or the Division has reasonable cause to believe, based on evidence satisfactory to it, that any person has violated or is about to violate any provision of this chapter, any regulation adopted pursuant thereto or any order, decision, demand or requirement of the Commission or the Division or a hearing panel, the Commission or the Division may bring an action in the district court for the county in which the person resides or, if the person does not reside in this State, in any court of competent jurisdiction within or outside this State, to restrain or enjoin that person from engaging in or continuing to commit the violations or from doing any act in furtherance of the violations.

2. The action must be brought in the name of the State of Nevada. If the action is brought in a court of this State, an order or judgment may be entered, when proper, issuing a temporary restraining order, preliminary injunction or final injunction. A temporary restraining order or preliminary injunction must not be issued without at least 5 days’ notice to the opposite party.

3. The court may issue the temporary restraining order, preliminary injunction or final injunction without:

(a) Proof of actual damages sustained by any person.

(b) The filing of any bond.

Sec. 36. Chapter 116 of NRS is hereby amended by adding thereto the provisions set forth as sections 37 to 47.6, inclusive, of this act.

Sec. 37. “Major component of the common elements” means any component of the common elements, including, without limitation, any amenity, improvement, furnishing, fixture, finish, system or equipment, that may, within 30 years after its original installation, require repair, replacement or restoration in excess of routine annual maintenance which is included in the annual operating budget of an association.

Sec. 38. (Deleted by amendment.)

Sec. 39. 1. At the time of each close of escrow of a unit in a converted building, the declarant shall deliver to the association the amount of the converted building reserve deficit allocated to that unit.

2. The allocation to a unit of the amount of any converted building reserve deficit must be made in the same manner as assessments are allocated to that unit.

3. As used in this section, “converted building reserve deficit” means the amount necessary to replace the major components of the common elements needing replacement within 10 years after the date of the first sale of a unit.

Sec. 40. 1. Except as otherwise limited by subsection 4 of NRS 116.2117, if:

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(a) To approve an amendment to the declaration pursuant to NRS 116.2117, the declaration requires:

(1) In a single-class voting structure, more than a majority of the total number of votes allocated to the single class to be cast in favor of the amendment; or

(2) In a multiclass voting structure, more than a majority of the total number of votes allocated to one or more of the multiple classes to be cast in favor of the amendment; and

(b) An amendment fails to receive the number of votes required by the declaration to be approved but:

(1) In a single-class voting structure, receives a majority of the total number of votes allocated to the single class; or

(2) In a multiclass voting structure, receives in each of the multiple classes a majority of the total number of votes allocated to that class,

Ê the association or any unit’s owner may file a petition with the district court in any county in which any portion of the common-interest community is located asking for an order waiving the supermajority requirements of the declaration and confirming the amendment as validly approved.

2. If the association or any unit’s owner files a petition pursuant to subsection 1, the petition:

(a) Must contain sufficient information specifying:

(1) The actions that have been taken to obtain the number of votes required to approve the amendment under the declaration and whether those actions have conformed with the procedures set forth in the declaration;

(2) The amount of time that has been allowed for the units’ owners to vote upon the amendment;

(3) The number and percentage of affirmative votes required in each voting class to approve the amendment under the declaration;

(4) The number and percentage of affirmative and negative votes actually received in each voting class with regard to the amendment; and

(5) Any other matters the petitioner considers relevant to the court’s determination; and

(b) Must include, as exhibits to the petition, copies of:

(1) The governing documents;

(2) The complete text of the amendment and a statement explaining the need for the amendment and its purposes and objectives;

(3) All notices and materials used in the effort to persuade the units’ owners to approve the amendment; and

(4) Any other documents the petitioner considers relevant to the court’s determination.

3. Upon receiving the petition, the court shall:

(a) Set the matter for hearing; and

(b) Issue an ex parte order setting forth the manner in which the petitioner must give written notice of the hearing to all the units’ owners in the association.

4. The court may grant the petition if it finds that the petitioner has presented evidence establishing that:

(a) The petitioner has given at least 15 days’ written notice of the hearing to:

(1) All the units’ owners in the association;

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(2) Each city, if any, and each county in which any portion of the common-interest community is located; and

(3) All other persons or entities that are entitled to notice under the declaration;

(b) The voting process regarding the amendment was conducted in accordance with all applicable provisions of the governing documents and state law;

(c) A reasonably diligent effort was made to allow all eligible units’ owners and, if required by the governing documents, all lenders to vote on the amendment;

(d) The amendment:

(1) In a single-class voting structure, received a majority of the total number of votes allocated to the single class; or

(2) In a multiclass voting structure, received in each of the multiple classes a majority of the total number of votes allocated to that class; and

(e) The amendment is reasonable.

5. If the court grants the petition, the court shall enter an order waiving the supermajority requirements of the declaration and confirming the amendment as validly approved.

6. An amendment confirmed by a final court order pursuant to this section is not effective until a certified copy of the amendment and the final court order have been recorded in each county in which any portion of the common-interest community is located. The amendment must be prepared, executed, recorded and certified on behalf of the association by any officer of the association designated for that purpose or, in the absence of designation, by the president of the association, and the final court order must be recorded along with the amendment.

7. After the amendment and the final court order have been recorded pursuant to this section, the declaration, as amended, has the same force and effect as if the amendment had been approved in compliance with every requirement imposed by the governing documents.

8. Not later than 30 days after the date on which the amendment and the final court order are recorded pursuant to this section, the association shall mail to all the units’ owners in the association:

(a) A copy of the amendment and the final court order; and

(b) A statement explaining that the amendment and the final court order have been recorded and that the declaration has been amended pursuant to this section.

Sec. 41. 1. The executive board shall not and the governing documents must not prohibit a unit’s owner from installing or maintaining drought tolerant landscaping within such physical portion of the common-interest community as that owner has a right to occupy and use exclusively, except that:

(a) Before installing drought tolerant landscaping, the unit’s owner must submit a detailed description or plans for the drought tolerant landscaping for architectural review and approval in accordance with the procedures, if any, set forth in the governing documents of the association; and

(b) The drought tolerant landscaping must be selected or designed to the maximum extent practicable to be compatible with the style of the common-interest community.

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2. Installation of drought tolerant landscaping within any common element or conversion of traditional landscaping or cultivated vegetation, such as turf grass, to drought tolerant landscaping within any common element shall not be deemed to be a change of use of the common element unless:

(a) The common element has been designated as a park, open play space or golf course on a recorded plat map; or

(b) The traditional landscaping or cultivated vegetation is required by a governing body under the terms of any applicable zoning ordinance, permit or approval or as a condition of approval of any final subdivision map.

3. As used in this section, “drought tolerant landscaping” means landscaping which conserves water, protects the environment and is adaptable to local conditions.

Sec. 42. 1. Except as otherwise provided in the declaration, an association may not require a unit’s owner to secure or obtain any approval from the association in order to rent or lease his unit.

2. The provisions of this section do not prohibit an association from enforcing any provisions which govern the renting or leasing of units and which are contained in this chapter or in any other applicable federal, state or local laws or regulations.

Sec. 43. 1. The Commission shall adopt regulations prescribing the requirements for the preparation and presentation of financial statements of an association pursuant to this chapter.

2. The regulations adopted by the Commission must include, without limitation:

(a) The qualifications necessary for a person to prepare and present financial statements of an association; and

(b) The standards and format to be followed in preparing and presenting financial statements of an association.

Sec. 44. 1. Except as otherwise provided in subsection 2, the executive board shall:

(a) If the annual budget of the association is less than $75,000, cause the financial statement of the association to be audited by an independent certified public accountant at least once every 4 fiscal years.

(b) If the annual budget of the association is $75,000 or more but less than $150,000, cause the financial statement of the association to be:

(1) Audited by an independent certified public accountant at least once every 4 fiscal years; and

(2) Reviewed by an independent certified public accountant every fiscal year for which an audit is not conducted.

(c) If the annual budget of the association is $150,000 or more, cause the financial statement of the association to be audited by an independent certified public accountant every fiscal year.

2. For any fiscal year for which an audit of the financial statement of the association will not be conducted pursuant to subsection 1, the executive board shall cause the financial statement for that fiscal year to be audited by an independent certified public accountant if, within 180 days before the end of the fiscal year, 15 percent of the total number of voting members of the association submit a written request for such an audit.

3. The Commission shall adopt regulations prescribing the requirements for the auditing or reviewing of financial statements of an association pursuant to this section.

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association pursuant to this section. Such regulations must include, without limitation:

(a) The qualifications necessary for a person to audit or review financial statements of an association; and

(b) The standards and format to be followed in auditing or reviewing financial statements of an association.

Sec. 45. 1. In a common-interest community which is not gated or enclosed and the access to which is not restricted or controlled by a person or device, the executive board shall not and the governing documents must not provide for the regulation of any road, street, alley or other thoroughfare the right-of-way of which is accepted by the State or a local government for dedication as a road, street, alley or other thoroughfare for public use.

2. The provisions of subsection 1 do not preclude an association from adopting, and do not preclude the governing documents of an association from setting forth, rules that reasonably restrict the parking or storage of recreational vehicles, watercraft, trailers or commercial vehicles in the common-interest community to the extent authorized by law.

Sec. 46. 1. The executive board shall not and the governing documents must not prohibit a unit’s owner or an occupant of a unit from exhibiting a political sign within such physical portion of the common-interest community as that owner or occupant has a right to occupy and use exclusively if the political sign is not larger than 24 inches by 36 inches.

2. The provisions of this section establish the minimum rights of a unit’s owner or an occupant of a unit to exhibit a political sign. The provisions of this section do not preempt any provisions of the governing documents that provide greater rights and do not require the governing documents or the executive board to impose any restrictions on the exhibition of political signs other than those established by other provisions of law.

3. As used in this section, “political sign” means a sign that expresses support for or opposition to a candidate, political party or ballot question.

Sec. 47. 1. The association shall provide written notice to each unit’s owner of a meeting at which the commencement of a civil action is to be considered at least 21 calendar days before the date of the meeting. Except as otherwise provided in this subsection, the association may commence a civil action only upon a vote or written agreement of the owners of units to which at least a majority of the votes of the members of the association are allocated. The provisions of this subsection do not apply to a civil action that is commenced:

(a) To enforce the payment of an assessment;

(b) To enforce the declaration, bylaws or rules of the association;

(d) To proceed with a counterclaim; or

(e) To protect the health, safety and welfare of the members of the association. If a civil action is commenced pursuant to this paragraph without the required vote or agreement, the action must be ratified within 90 days after the commencement of the action by a vote or written agreement of the owners of the units to which at least a majority of votes of the members of the association are allocated. If the association, after making a good faith effort, cannot obtain the required vote or agreement to commence or ratify such a civil action, the association may thereafter seek to dismiss the action without prejudice for that reason only if a vote or written agreement of the owners of the units to which at least a majority of votes or the members of the association are allocated was obtained at the time the approval to commence or ratify the action was sought.

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commence or ratify such a civil action, the association may thereafter seek to dismiss the action without prejudice for that reason only if a vote or written agreement of the owners of the units to which at least a majority of votes or the members of the association are allocated was obtained at the time the approval to commence or ratify the action was sought.

2. At least 10 days before an association commences or seeks to ratify the commencement of a civil action, the association shall provide a written statement to all the units’ owners that includes:

(a) A reasonable estimate of the costs of the civil action, including reasonable attorney’s fees;

(b) An explanation of the potential benefits of the civil action and the potential adverse consequences if the association does not commence the action or if the outcome of the action is not favorable to the association; and

3. No person other than a unit’s owner may request the dismissal of a civil action commenced by the association on the ground that the association failed to comply with any provision of this section.

4. If any civil action in which the association is a party is settled, the executive board shall disclose the terms and conditions of the settlement at the next regularly scheduled meeting of the executive board after the settlement has been reached. The executive board may not approve a settlement which contains any terms and conditions that would prevent the executive board from complying with the provisions of this subsection.

Sec. 47.3. 1. Each witness who is subpoenaed and appears at a hearing is entitled to receive for his attendance the same fees and mileage allowed by law to a witness in a civil case.

2. The fees and mileage for the witness:

(a) Must be paid by the party at whose request the witness is subpoenaed; or

(b) If the appearance of the witness is not requested by any party but the witness is subpoenaed at the request of the Commission or a hearing panel, must be paid by the Division.

Sec. 47.6. 1. Except as otherwise provided in this section, a written affidavit filed with the Division pursuant to NRS 116.760, all documents and other information filed with the written affidavit and all documents and other information compiled as a result of an investigation conducted to determine whether to file a formal complaint with the Commission are confidential.

2. A formal complaint filed with the Commission and all documents and other information considered by the Commission or a hearing panel when determining whether to impose discipline or take other administrative action pursuant to NRS 116.745 to 116.795, inclusive, are public records.

Sec. 48. NRS 116.003 is hereby amended to read as follows:

116.003 As used in this chapter and in the declaration and bylaws of an association, unless the context otherwise requires, the words and terms defined in NRS 116.005 to 116.095, inclusive, and section 37 of this act have the meanings ascribed to them in those sections.

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Sec. 49. NRS 116.013 is hereby amended to read as follows:

116.013 “Certificate” means a certificate for the management of a common-interest community issued by the Division [.] pursuant to sections 2 to 35, inclusive, of this act.

Sec. 50. NRS 116.047 is hereby amended to read as follows:

116.047 “Financial statement” means a [balance sheet showing profit and loss of an association and the funds held in reserve by the association.] financial statement of an association that is prepared and presented in accordance with the requirements established by the Commission pursuant to section 43 of this act.

Sec. 51. NRS 116.049 is hereby amended to read as follows:

116.049 “Governing documents” means [the declaration,]

1. The declaration for the common-interest community;

2. The articles of incorporation, articles of association, articles of organization, certificate of registration, certificate of limited partnership, certificate of trust or other documents that are used to organize the association for the common-interest community;

3. The bylaws and rules of [an] the association ; and [any]

4. Any other documents that govern the operation of [a] the common-interest community or the association.

Sec. 52. NRS 116.1106 is hereby amended to read as follows:

116.1106 1. A building code may not impose any requirement upon any structure in a common-interest community which it would not impose upon a physically identical development under a different form of ownership.

2. In condominiums and cooperatives, no zoning, subdivision or other law, ordinance or regulation governing the use of real estate may prohibit the condominium or cooperative as a form of ownership or impose any requirement upon a condominium or cooperative which it would not impose upon a physically identical development under a different form of ownership.

3. Except as otherwise provided in subsections 1 and 2, the provisions of this chapter do not invalidate or modify any provision of any building code or zoning, subdivision or other law, ordinance, rule or regulation governing the use of real estate.

4. The provisions of this section do not prohibit a local government from imposing different requirements and standards regarding design and construction on different types of structures in common-interest communities. For the purposes of this subsection, a townhouse in a planned community is a different type of structure from other structures in common-interest communities, including, without limitation, other structures that are or will be owned as condominiums or cooperatives.

Sec. 53. NRS 116.11085 is hereby amended to read as follows:

116.11085 If a matter governed by this chapter is also governed by chapter 78 [or] , 81, 82 , 86, 87, 88 or 88A of NRS [or NRS 81.010 to 81.160, inclusive,] and there is a conflict between the provisions of this chapter and the provisions of [chapter 78 or 82 of NRS or NRS 81.010 to 81.160, inclusive,] those other chapters, the provisions of this chapter prevail.

Sec. 54. NRS 116.1201 is hereby amended to read as follows:

116.1201 1. Except as otherwise provided in this section and NRS 116.1203, this chapter applies to all common-interest communities created within this State.

2. This chapter does not apply to:

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(a) [Associations created for the limited purpose of maintaining:

(1) The landscape of the common elements of a common-interest community;

(2) Facilities for flood control; or

(3) Except as otherwise provided in NRS 116.31075,] A limited-purpose association, except that a limited-purpose association:

(1) Shall pay the fees required pursuant to NRS 116.31155;

(2) Shall register with the Ombudsman pursuant to NRS 116.31158;

(3) Shall comply with the provisions of:

(I) NRS 116.31038, 116.31083 and 116.31152; and

(II) NRS 116.31075, if the limited-purpose association is created for a rural agricultural residential common-interest community;

(4) Shall comply with the provisions of NRS 116.4101 to 116.412, inclusive, as required by the regulations adopted by the Commission pursuant to paragraph (b) of subsection 5; and

(5) Shall not enforce any restrictions concerning the use of units by the units’ owners, unless the limited-purpose association is created for a rural agricultural residential common-interest community.

(b) A planned community in which all units are restricted exclusively to nonresidential use unless the declaration provides that this chapter does apply to that planned community. This chapter applies to a planned community containing both units that are restricted exclusively to nonresidential use and other units that are not so restricted only if the declaration so provides or if the real estate comprising the units that may be used for residential purposes would be a planned community in the absence of the units that may not be used for residential purposes.

(c) Common-interest communities or units located outside of this State, but the provisions of NRS 116.4102 to 116.4108, inclusive, apply to all contracts for the disposition thereof signed in this State by any party unless exempt under subsection 2 of NRS 116.4101.

(d) A common-interest community that was created before January 1, 1992, is located in a county whose population is less than 50,000, and has less than 50 percent of the units within the community put to residential use, unless a majority of the units’ owners otherwise elect in writing.

(e) Except as otherwise provided in this chapter, time shares governed by the provisions of chapter 119A of NRS.

3. The provisions of this chapter do not:

(a) Prohibit a common-interest community created before January 1, 1992, from providing for separate classes of voting for the units’ owners ; [of the association;]

(b) Require a common-interest community created before January 1, 1992, to comply with the provisions of NRS 116.2101 to 116.2122, inclusive;

(c) Invalidate any assessments that were imposed on or before October 1, 1999, by a common-interest community created before January 1, 1992; or

(d) Prohibit a common-interest community created before January 1, 1992, or a common-interest community described in NRS 116.31105 from providing for a representative form of government.

4. The provisions of chapters 117 and 278A of NRS do not apply to common-interest communities.

5. The Commission shall establish, by regulation [, the] :

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(a) The criteria for determining whether an association , a limited-purpose association or a common-interest community satisfies the requirements for an exemption or limited exemption from any provision of this chapter [.] ; and

(b) The extent to which a limited-purpose association must comply with the provisions of NRS 116.4101 to 116.412, inclusive.

6. As used in this section, “limited-purpose association” means an association that:

(a) Is created for the limited purpose of maintaining:

(1) The landscape of the common elements of a common-interest community;

(2) Facilities for flood control; or

(3) A rural agricultural residential common-interest community; and

(b) Is not authorized by its governing documents to enforce any restrictions concerning the use of units by units’ owners, unless the limited-purpose association is created for a rural agricultural residential common-interest community.

Sec. 54.5. NRS 116.1203 is hereby amended to read as follows:

116.1203 1. Except as otherwise provided in subsection 2, if a planned community contains no more than 12 units and is not subject to any developmental rights, it is subject only to NRS 116.1105, 116.1106 and 116.1107 unless the declaration provides that this entire chapter is applicable.

2. Except for NRS 116.3104, 116.31043, 116.31046 and 116.31138, the provisions of NRS 116.3101 to 116.3119, inclusive, and sections 41 to 47, inclusive, of this act, and the definitions set forth in NRS 116.005 to 116.095, inclusive, to the extent that such definitions are necessary in construing any of those provisions, apply to a residential planned community containing more than six units.

Sec. 55. NRS 116.2117 is hereby amended to read as follows:

116.2117 1. Except as otherwise provided in section 40 of this act, and except in cases of amendments that may be executed by a declarant under subsection 6 of NRS 116.2109 or NRS 116.211, or by the association under NRS 116.1107, subsection 4 of NRS 116.2106, subsection 3 of NRS 116.2108, subsection 1 of NRS 116.2112 or NRS 116.2113, or by certain units’ owners under subsection 2 of NRS 116.2108, subsection 1 of NRS 116.2112, subsection 2 of NRS 116.2113 or subsection 2 of NRS 116.2118, and except as otherwise limited by subsection 4, the declaration, including any plats and plans, may be amended only by vote or agreement of units’ owners of units to which at least a majority of the votes in the association are allocated, or any larger majority the declaration specifies. The declaration may specify a smaller number only if all of the units are restricted exclusively to nonresidential use.

2. No action to challenge the validity of an amendment adopted by the association pursuant to this section may be brought more than one year after the amendment is recorded.

3. Every amendment to the declaration must be recorded in every county in which any portion of the common-interest community is located and is effective only upon recordation. An amendment, except an amendment pursuant to NRS 116.2112, must be indexed in the grantee’s index in the name of the common-interest community and the association and in the grantor’s index in the name of the parties executing the amendment.

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and in the grantor’s index in the name of the parties executing the amendment.

4. Except to the extent expressly permitted or required by other provisions of this chapter, no amendment may change the boundaries of any unit, the allocated interests of a unit or the uses to which any unit is restricted, in the absence of unanimous consent of the units’ owners affected and the consent of a majority of the owners of the remaining units.

5. Amendments to the declaration required by this chapter to be recorded by the association must be prepared, executed, recorded and certified on behalf of the association by any officer of the association designated for that purpose or, in the absence of designation, by the president of the association.

Sec. 56. NRS 116.3101 is hereby amended to read as follows:

116.3101 1. A unit-owners’ association must be organized no later than the date the first unit in the common-interest community is conveyed.

2. The membership of the association at all times consists exclusively of all units’ owners or, following termination of the common-interest community, of all owners of former units entitled to distributions of proceeds under NRS 116.2118, 116.21183 and 116.21185, or their heirs, successors or assigns.

3. The association must:

(a) Be organized as a profit or nonprofit corporation, association, limited-liability company, trust or partnership;

(b) Include in its articles of incorporation, articles of association, articles of organization, certificate of registration [or certificates] , certificate of limited partnership, certificate of trust or other documents of organization, or any [certificate of] amendment thereof, that the purpose of the corporation , association, limited-liability company, trust or partnership is to operate as an association pursuant to this chapter;

(c) Contain in its name the words “common-interest community,” “community association,” “master association,” “homeowners’ association” or “unit-owners’ association”; and

(d) Comply with the provisions of chapters 78, 81, 82, 86, 87 , [and] 88 and 88A of NRS when filing with the Secretary of State its articles of incorporation, [certificates] articles of association, articles of organization, certificate of registration [or certificates] , certificate of limited partnership, certificate of trust or other documents of organization, or any [certificate of] amendment thereof . [, with the Secretary of State.]

Sec. 57. NRS 116.3102 is hereby amended to read as follows:

116.3102 1. Except as otherwise provided in subsection 2, and subject to the provisions of the declaration, the association may [:] do any or all of the following:

(a) Adopt and amend bylaws, rules and regulations . [;]

(b) Adopt and amend budgets for revenues, expenditures and reserves and collect assessments for common expenses from the units’ owners . [;]

(d) Institute, defend or intervene in litigation or administrative proceedings in its own name on behalf of itself or two or more units’ owners on matters affecting the common-interest community . [;]

(e) Make contracts and incur liabilities . [;]

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(f) Regulate the use, maintenance, repair, replacement and modification of common elements . [;]

(g) Cause additional improvements to be made as a part of the common elements . [;]

(h) Acquire, hold, encumber and convey in its own name any right, title or interest to real estate or personal property, but:

(1) Common elements in a condominium or planned community may be conveyed or subjected to a security interest only pursuant to NRS 116.3112; and

(2) Part of a cooperative may be conveyed, or all or part of a cooperative may be subjected to a security interest, only pursuant to NRS 116.3112 . [;]

(i) Grant easements, leases, licenses and concessions through or over the common elements . [;]

(j) Impose and receive any payments, fees or charges for the use, rental or operation of the common elements, other than limited common elements described in subsections 2 and 4 of NRS 116.2102, and for services provided to the units’ owners . [;]

(k) Impose charges for late payment of assessments . [;]

(l) Impose construction penalties when authorized pursuant to NRS 116.310305 . [;]

(m) Impose reasonable fines for violations of the governing documents of the association only if the association complies with the requirements set forth in NRS 116.31031 . [;]

(n) Impose reasonable charges for the preparation and recordation of any amendments to the declaration [, the information required by NRS 116.4109] or any statements of unpaid assessments [;] , and impose reasonable fees, not to exceed the amounts authorized by NRS 116.4109, for preparing and furnishing the documents and certificate required by that section.

(o) Provide for the indemnification of its officers and executive board and maintain directors’ and officers’ liability insurance . [;]

(p) Assign its right to future income, including the right to receive assessments for common expenses, but only to the extent the declaration expressly so provides . [;]

(q) Exercise any other powers conferred by the declaration or bylaws . [;]

(r) Exercise all other powers that may be exercised in this State by legal entities of the same type as the association . [;]

(s) Direct the removal of vehicles improperly parked on property owned or leased by the association, as authorized pursuant to NRS 487.038 [; and] , or improperly parked on any road, street, alley or other thoroughfare within the common-interest community in violation of the governing documents. In addition to complying with the requirements of NRS 487.038 and any requirements in the governing documents, if a vehicle is improperly parked as described in this paragraph, the association must post written notice in a conspicuous place on the vehicle or provide oral or written notice to the owner or operator of the vehicle at least 48 hours before the association may direct the removal of the vehicle, unless the vehicle:

(1) Is blocking a fire hydrant, fire lane or parking space designated for the handicapped; or

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(2) Poses an imminent threat of causing a substantial adverse effect on the health, safety or welfare of the units’ owners or residents of the common-interest community.

(t) Exercise any other powers necessary and proper for the governance and operation of the association.

2. The declaration may not impose limitations on the power of the association to deal with the declarant which are more restrictive than the limitations imposed on the power of the association to deal with other persons.

Sec. 58. NRS 116.3103 is hereby amended to read as follows:

116.3103 1. Except as otherwise provided in the declaration, the bylaws, this section or other provisions of this chapter, the executive board may act in all instances on behalf of the association. In the performance of their duties, the officers and members of the executive board are fiduciaries. The members of the executive board are required to exercise the ordinary and reasonable care of directors of a corporation, subject to the business-judgment rule.

2. The executive board may not act on behalf of the association to amend the declaration, to terminate the common-interest community, or to elect members of the executive board or determine their qualifications, powers and duties or terms of office, but the executive board may fill vacancies in its membership for the unexpired portion of any term.

[3. Within 30 days after adoption of any proposed budget for the common-interest community, the executive board shall provide a summary of the budget to all the units’ owners, and shall set a date for a meeting of the units’ owners to consider ratification of the budget not less than 14 nor more than 30 days after mailing of the summary. Unless at that meeting a majority of all units’ owners or any larger vote specified in the declaration reject the budget, the budget is ratified, whether or not a quorum is present. If the proposed budget is rejected, the periodic budget last ratified by the units’ owners must be continued until such time as the units’ owners ratify a subsequent budget proposed by the executive board.]

Sec. 59. NRS 116.31031 is hereby amended to read as follows:

116.31031 1. Except as otherwise provided in this section, if a unit’s owner or a tenant or guest of a unit’s owner violates any provision of the governing documents of an association, the executive board [of the association] may, if the governing documents so provide:

(a) Prohibit, for a reasonable time, the unit’s owner or the tenant or guest of the unit’s owner from:

(1) Voting on matters related to the common-interest community.

(2) Using the common elements. The provisions of this subparagraph do not prohibit the unit’s owner or the tenant or guest of the unit’s owner from using any vehicular or pedestrian ingress or egress to go to or from the unit, including any area used for parking.

(b) Impose a fine against the unit’s owner or the tenant or guest of the unit’s owner for each violation, except that a fine may not be imposed for a violation that is the subject of a construction penalty pursuant to NRS 116.310305. [The] If the violation poses an imminent threat of causing a substantial adverse effect on the health, safety or welfare of the units’ owners or residents of the common-interest community, the amount of the fine must be commensurate with the severity of the violation and must be determined by the executive board in accordance with the governing documents.

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documents. If the violation does not pose an imminent threat of causing a substantial adverse effect on the health, safety or welfare of the units’ owners or residents of the common-interest community, the amount of the fine must be commensurate with the severity of the violation [,] and must be determined by the executive board in accordance with the governing documents, but the amount of the fine must not exceed $100 for each violation or a total amount of [$500,] $1,000, whichever is less. The limitations on the amount of the fine do not apply to any interest, charges or costs that may be collected by the association pursuant to this section if the fine becomes past due.

2. The executive board may not impose a fine pursuant to subsection 1 unless:

(a) Not less than 30 days before the violation, the person against whom the fine will be imposed had been provided with written notice of the applicable provisions of the governing documents that form the basis of the violation; and

(b) Within a reasonable time after the discovery of the violation, the person against whom the fine will be imposed has been provided with:

(1) Written notice specifying the details of the violation, the amount of the fine, and the date, time and location for a hearing on the violation; and

(2) A reasonable opportunity to contest the violation at the hearing.

3. The executive board must schedule the date, time and location for the hearing on the violation so that the person against whom the fine will be imposed is provided with a reasonable opportunity to prepare for the hearing and to be present at the hearing.

4. The executive board must hold a hearing before it may impose the fine, unless the person against whom the fine will be imposed:

(a) Pays the fine;

(b) Executes a written waiver of the right to the hearing; or

5. If a fine is imposed pursuant to subsection 1 and the violation is not cured within 14 days, or within any longer period that may be established by the executive board, the violation shall be deemed a continuing violation. Thereafter, the executive board may impose an additional fine for the violation for each 7-day period or portion thereof that the violation is not cured. Any additional fine may be imposed without notice and an opportunity to be heard.

6. If the governing documents so provide, the executive board may appoint a committee, with not less than three members, to conduct hearings on violations and to impose fines pursuant to this section. While acting on behalf of the executive board for those limited purposes, the committee and its members are entitled to all privileges and immunities and are subject to all duties and requirements of the executive board and its members.

7. The provisions of this section establish the minimum procedural requirements that the executive board must follow before it may impose a fine. The provisions of this section do not preempt any provisions of the governing documents that provide greater procedural protections.

8. Any past due fine:

(a) Bears interest at the rate established by the association, not to exceed the legal rate per annum.

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(b) May include any costs of collecting the past due fine at a rate established by the association. If the past due fine is for a violation that does not threaten the health, safety or welfare of the residents of the common-interest community, the rate established by the association for the costs of collecting the past due fine:

(1) May not exceed $20, if the outstanding balance is less than $200.

(2) May not exceed $50, if the outstanding balance is $200 or more, but is less than $500.

(3) May not exceed $100, if the outstanding balance is $500 or more, but is less than $1,000.

(4) May not exceed $250, if the outstanding balance is $1,000 or more, but is less than $5,000.

(5) May not exceed $500, if the outstanding balance is $5,000 or more.

9. As used in this section:

(a) “Costs of collecting” includes, without limitation, any collection fee, filing fee, recording fee, referral fee, fee for postage or delivery, and any other fee or cost that an association may reasonably charge to the unit’s owner for the collection of a past due fine. The term does not include any costs incurred by an association during a civil action to enforce the payment of a past due fine.

(b) “Outstanding balance” means the amount of a past due fine that remains unpaid before any interest, charges for late payment or costs of collecting the past due fine are added.

Sec. 60. NRS 116.31034 is hereby amended to read as follows:

116.31034 1. Except as otherwise provided in subsection 5 of NRS 116.212, not later than the termination of any period of declarant’s control, the units’ owners shall elect an executive board of at least three members, at least a majority of whom must be units’ owners. Unless the governing documents provide otherwise, the remaining members of the executive board do not have to be units’ owners. The executive board shall elect the officers of the association. The members of the executive board and the officers of the association shall take office upon election.

2. The term of office of a member of the executive board may not exceed 2 years, except for members who are appointed by the declarant. Unless the governing documents provide otherwise, there is no limitation on the number of terms that a person may serve as a member of the executive board.

3. The governing documents of the association must provide for terms of office that are staggered in such a manner that, to the extent possible, an equal number of members of the executive board are elected at each election. The provisions of this subsection do not apply to:

(a) Members of the executive board who are appointed by the declarant; and

(b) Members of the executive board who serve a term of 1 year or less.

4. Not less than 30 days before the preparation of a ballot for the election of members of the executive board, the secretary or other officer specified in the bylaws of the association shall cause notice to be given to each unit’s owner of his eligibility to serve as a member of the executive board. Each unit’s owner who is qualified to serve as a member of the executive board may have his name placed on the ballot along with the names of the nominees selected by the members of the executive board or a nominating committee established by the association.

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executive board may have his name placed on the ballot along with the names of the nominees selected by the members of the executive board or a nominating committee established by the association.

5. Each person whose name is placed on the ballot as a candidate for a member of the executive board must [make] :

(a) Make a good faith effort to disclose any financial, business, professional or personal relationship or interest that would result or would appear to a reasonable person to result in a potential conflict of interest for the candidate if the candidate were to be elected to serve as a member of the executive board [.] ; and

(b) Disclose whether the candidate is a member in good standing. For the purposes of this paragraph, a candidate shall not be deemed to be in “good standing” if the candidate has any unpaid and past due assessments or construction penalties that are required to be paid to the association.

Ê The candidate must make [the disclosure,] all disclosures required pursuant to this subsection in writing to the association with his candidacy information. The association shall distribute the disclosures to each member of the association with the ballot in the manner established in the bylaws of the association.

6. Unless a person is appointed by the declarant:

(a) A person may not be a member of the executive board [of an association] or an officer of [that] the association if the person, his spouse or his parent or child, by blood, marriage or adoption, performs the duties of a community manager for that association.

(b) A person may not be a member of the executive board of a master association or an officer of that master association if the person, his spouse or his parent or child, by blood, marriage or adoption, performs the duties of a community manager for:

(1) That master association; or

(2) Any association that is subject to the governing documents of that master association.

7. An officer, employee, agent or director of a corporate owner of a unit, a trustee or designated beneficiary of a trust that owns a unit, a partner of a partnership that owns a unit, a member or manager of a limited-liability company that owns a unit, and a fiduciary of an estate that owns a unit may be an officer of the association or a member of the executive board. In all events where the person serving or offering to serve as an officer of the association or a member of the executive board is not the record owner, he shall file proof in the records of the association that:

(a) He is associated with the corporate owner, trust, partnership, limited-liability company or estate as required by this subsection; and

(b) Identifies the unit or units owned by the corporate owner, trust, partnership, limited-liability company or estate.

8. The election of any member of the executive board must be conducted by secret written ballot unless the declaration of the association provides that voting rights may be exercised by delegates or representatives as set forth in NRS 116.31105. If the election of any member of the executive board is conducted by secret written ballot:

(a) The secretary or other officer specified in the bylaws of the association shall cause a secret ballot and a return envelope to be sent, prepaid by United States mail, to the mailing address of each unit within the common-interest community or to any other mailing address designated in writing by the unit’s owner.

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common-interest community or to any other mailing address designated in writing by the unit’s owner.

(b) Each unit’s owner must be provided with at least 15 days after the date the secret written ballot is mailed to the unit’s owner to return the secret written ballot to the association.

(d) Only the secret written ballots that are returned to the association may be counted to determine the outcome of the election.

(e) The secret written ballots must be opened and counted at a meeting of the association. A quorum is not required to be present when the secret written ballots are opened and counted at the meeting.

(f) The incumbent members of the executive board and each person whose name is placed on the ballot as a candidate for a member of the executive board may not possess, be given access to or participate in the opening or counting of the secret written ballots that are returned to the association before those secret written ballots have been opened and counted at a meeting of the association.

9. Each member of the executive board shall, within 90 days after his appointment or election, certify in writing to the association, on a form prescribed by the Administrator, that he has read and understands the governing documents of the association and the provisions of this chapter to the best of his ability. The Administrator may require the association to submit a copy of the certification of each member of the executive board of that association at the time the association registers with the Ombudsman pursuant to NRS 116.31158.

Sec. 61. NRS 116.31036 is hereby amended to read as follows:

116.31036 1. Notwithstanding any provision of the declaration or bylaws to the contrary, [the units’ owners, by a two-thirds vote of all persons entitled to vote at any meeting of the units’ owners at which a quorum is present, may remove] any member of the executive board , [with or without cause,] other than a member appointed by the declarant [.] , may be removed from the executive board, with or without cause, if at a removal election held pursuant to this section the number of votes cast in favor of removal constitutes:

(a) At least 35 percent of the total number of voting members of the association; and

(b) At least a majority of all votes cast in that removal election.

2. The removal of any member of the executive board must be conducted by secret written ballot unless the declaration of the association provides that voting rights may be exercised by delegates or representatives as set forth in NRS 116.31105. If the removal of a member of the executive board is conducted by secret written ballot:

(b) Each unit’s owner must be provided with at least 15 days after the date the secret written ballot is mailed to the unit’s owner to return the secret written ballot to the association.

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(d) The secret written ballots must be opened and counted at a meeting of the association. A quorum is not required to be present when the secret written ballots are opened and counted at the meeting.

(e) The incumbent members of the executive board, including, without limitation, the member who is subject to the removal, may not possess, be given access to or participate in the opening or counting of the secret written ballots that are returned to the association before those secret written ballots have been opened and counted at a meeting of the association.

3. If a member of an executive board is named as a respondent or sued for liability for actions undertaken in his role as a member of the board, the association shall indemnify him for his losses or claims, and undertake all costs of defense, unless it is proven that he acted with willful or wanton misfeasance or with gross negligence. After such proof, the association is no longer liable for the cost of defense, and may recover costs already expended from the member of the executive board who so acted. Members of the executive board are not personally liable to the victims of crimes occurring on the property. Punitive damages may not be recovered against the association, but may be recovered from persons whose activity gave rise to the damages.

4. The provisions of this section do not prohibit the Commission from taking any disciplinary action against a member of an executive board pursuant to NRS 116.745 to 116.795, inclusive.

Sec. 62. NRS 116.31038 is hereby amended to read as follows:

116.31038 [Within] In addition to any applicable requirement set forth in section 39 of this act, within 30 days after units’ owners other than the declarant may elect a majority of the members of the executive board, the declarant shall deliver to the association all property of the units’ owners and of the association held by or controlled by him, including:

1. The original or a certified copy of the recorded declaration as amended, the [association’s] articles of incorporation [if the association is incorporated,] , articles of association, articles of organization, certificate of registration, certificate of limited partnership, certificate of trust or other documents of organization for the association, the bylaws, minute books and other books and records of the association and any rules or regulations which may have been adopted.

2. An accounting for money of the association and audited financial statements for each fiscal year and any ancillary period from the date of inception of the association [received money] to the date the period of the declarant’s control ends. The financial statements must fairly and accurately report the association’s financial [condition prepared in accordance with generally accepted accounting principles.] position.

3. A complete study of the reserves of the association, conducted by a person [qualified by training and experience] who holds a permit to conduct such a study [.] issued pursuant to sections 2 to 35, inclusive, of this act. At the time the control of the declarant ends, he shall:

(a) Except as otherwise provided in this paragraph, deliver to the association a reserve account that contains the declarant’s share of the amounts then due, and control of the account. If the declaration was recorded before October 1, 1999, and, at the time the control of the declarant ends, he has failed to pay his share of the amounts due, the executive board shall authorize the declarant to pay the deficiency in installments for a period of 3 years, unless the declarant and the executive board agree to a shorter period.

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authorize the declarant to pay the deficiency in installments for a period of 3 years, unless the declarant and the executive board agree to a shorter period.

(b) Disclose, in writing, the amount by which he has subsidized the association’s dues on a per unit or per lot basis.

4. The association’s money or control thereof.

5. All of the declarant’s tangible personal property that has been represented by the declarant as property of the association or, unless the declarant has disclosed in the public offering statement that all such personal property used in the common‑interest community will remain the declarant’s property, all of the declarant’s tangible personal property that is necessary for, and has been used exclusively in, the operation and enjoyment of the common elements, and inventories of these properties.

6. A copy of any plans and specifications used in the construction of the improvements in the common-interest community which were completed within 2 years before the declaration was recorded.

7. All insurance policies then in force, in which the units’ owners, the association, or its directors and officers are named as insured persons.

8. Copies of any certificates of occupancy that may have been issued with respect to any improvements comprising the common-interest community other than units in a planned community.

9. Any renewable permits and approvals issued by governmental bodies applicable to the common-interest community which are in force and any other permits and approvals so issued and applicable which are required by law to be kept on the premises of the community.

10. Written warranties of the contractor, subcontractors, suppliers and manufacturers that are still effective.

11. A roster of owners and mortgagees of units and their addresses and telephone numbers, if known, as shown on the declarant’s records.

12. Contracts of employment in which the association is a contracting party.

13. Any contract for service in which the association is a contracting party or in which the association or the units’ owners have any obligation to pay a fee to the persons performing the services.

Sec. 63. NRS 116.3108 is hereby amended to read as follows:

116.3108 1. A meeting of the units’ owners [of an association] must be held at least once each year. If the governing documents [of a common-interest community] do not designate an annual meeting date of the units’ owners, a meeting of the units’ owners must be held 1 year after the date of the last meeting of the units’ owners. If the units’ owners have not held a meeting for 1 year, a meeting of the units’ owners must be held on the following March 1.

2. Special meetings of the units’ owners [of an association] may be called by the president, a majority of the executive board or by units’ owners [having] constituting at least 10 percent, or any lower percentage specified in the bylaws, of the [votes in] total number of voting members of the association.

[2.] The same number of units’ owners may also call a removal election pursuant to NRS 116.31036. To call a special meeting or a removal election, the units’ owners must submit a written petition which is signed by the required percentage of the total number of voting members of the association pursuant to this section and which is mailed, return receipt requested, or served by a process server to the executive board or the community manager for the association.

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ê2005 Statutes of Nevada, Page 2599 (CHAPTER 494, SB 325)ê

community manager for the association. If the petition calls for a special meeting, the executive board shall set the date for the special meeting so that the special meeting is held not less than 15 days or more than 60 days after the date on which the petition is received. If the petition calls for a removal election and:

(a) The voting rights of the units’ owners will be exercised by delegates or representatives as set forth in NRS 116.31105, the executive board shall set the date for the removal election so that the removal election is held not less than 15 days or more than 60 days after the date on which the petition is received; or

(b) The voting rights of the units’ owners will be exercised through the use of secret written ballots pursuant to NRS 116.31036, the secret written ballots for the removal election must be sent in the manner required by NRS 116.31036 not less than 15 days or more than 60 days after the date on which the petition is received, and the executive board shall set the date for the meeting to open and count the secret written ballots so that the meeting is held not more than 15 days after the deadline for returning the secret written ballots.

3. Not less than [10 nor] 15 days or more than 60 days in advance of any meeting of the units’ owners , [of an association,] the secretary or other officer specified in the bylaws shall cause notice of the meeting to be hand-delivered, sent prepaid by United States mail to the mailing address of each unit or to any other mailing address designated in writing by the unit’s owner or, if the association offers to send notice by electronic mail, sent by electronic mail at the request of the unit’s owner to an electronic mail address designated in writing by the unit’s owner. The notice of the meeting must state the time and place of the meeting and include a copy of the agenda for the meeting. The notice must include notification of the right of a unit’s owner to:

(a) Have a copy of the minutes or a summary of the minutes of the meeting provided to the unit’s owner upon request and, if required by the executive board, upon payment to the association of the cost of providing the copy to the unit’s owner.

(b) Speak to the association or executive board, unless the executive board is meeting in executive session.

[3.] 4. The agenda for a meeting of the units’ owners must consist of:

(a) A clear and complete statement of the topics scheduled to be considered during the meeting, including, without limitation, any proposed amendment to the declaration or bylaws, any fees or assessments to be imposed or increased by the association, any budgetary changes and any proposal to remove an officer of the association or member of the executive board.

(b) A list describing the items on which action may be taken and clearly denoting that action may be taken on those items. In an emergency, the units’ owners may take action on an item which is not listed on the agenda as an item on which action may be taken.

(c) A period devoted to comments by units’ owners and discussion of those comments. Except in emergencies, no action may be taken upon a matter raised under this item of the agenda until the matter itself has been specifically included on an agenda as an item upon which action may be taken pursuant to paragraph (b).

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ê2005 Statutes of Nevada, Page 2600 (CHAPTER 494, SB 325)ê

[4.] 5. If the association adopts a policy imposing fines for any violations of the governing documents of the association, the secretary or other officer specified in the bylaws shall prepare and cause to be hand-delivered or sent prepaid by United States mail to the mailing address of each unit or to any other mailing address designated in writing by the unit’s owner, a schedule of the fines that may be imposed for those violations.

[5.] 6. The secretary or other officer specified in the bylaws shall cause minutes to be recorded or otherwise taken at each meeting of the units’ owners. Not more than 30 days after each such meeting, the secretary or other officer specified in the bylaws shall cause the minutes or a summary of the minutes of the meeting to be made available to the units’ owners. A copy of the minutes or a summary of the minutes must be provided to any unit’s owner upon request and, if required by the executive board, upon payment to the association of the cost of providing the copy to the unit’s owner.

[6.] 7. Except as otherwise provided in subsection [7,] 8, the minutes of each meeting of the units’ owners must include:

(a) The date, time and place of the meeting;

(b) The substance of all matters proposed, discussed or decided at the meeting; and

(c) The substance of remarks made by any unit’s owner at the meeting if he requests that the minutes reflect his remarks or, if he has prepared written remarks, a copy of his prepared remarks if he submits a copy for inclusion.

[7.] 8. The executive board may establish reasonable limitations on materials, remarks or other information to be included in the minutes of a meeting of the units’ owners.

[8.] 9. The association shall maintain the minutes of each meeting of the units’ owners until the common-interest community is terminated.

[9.] 10. A unit’s owner may record on audiotape or any other means of sound reproduction a meeting of the units’ owners if the unit’s owner, before recording the meeting, provides notice of his intent to record the meeting to the other units’ owners who are in attendance at the meeting.

[10.] 11. The units’ owners may approve, at the annual meeting of the units’ owners, the minutes of the prior annual meeting of the units’ owners and the minutes of any prior special meetings of the units’ owners. A quorum is not required to be present when the units’ owners approve the minutes.

12. As used in this section, “emergency” means any occurrence or combination of occurrences that:

(a) Could not have been reasonably foreseen;

(b) Affects the health, welfare and safety of the units’ owners or residents of the [association;] common-interest community;

(d) Makes it impracticable to comply with the provisions of subsection [2 or 3.] 3 or 4.

Sec. 64. NRS 116.31083 is hereby amended to read as follows:

116.31083 1. A meeting of the executive board [of an association] must be held at least once every 90 days.

2. Except in an emergency or unless the bylaws of an association require a longer period of notice, the secretary or other officer specified in the bylaws of the association shall, not less than 10 days before the date of a meeting of the executive board, cause notice of the meeting to be given to the units’ owners.

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ê2005 Statutes of Nevada, Page 2601 (CHAPTER 494, SB 325)ê

meeting of the executive board, cause notice of the meeting to be given to the units’ owners. Such notice must be:

(a) Sent prepaid by United States mail to the mailing address of each unit within the common-interest community or to any other mailing address designated in writing by the unit’s owner;

(b) If the association offers to send notice by electronic mail, sent by electronic mail at the request of the unit’s owner to an electronic mail address designated in writing by the unit’s owner; or

3. In an emergency, the secretary or other officer specified in the bylaws of the association shall, if practicable, cause notice of the meeting to be sent prepaid by United States mail to the mailing address of each unit within the common-interest community. If delivery of the notice in this manner is impracticable, the notice must be hand-delivered to each unit within the common-interest community or posted in a prominent place or places within the common elements of the association.

4. The notice of a meeting of the executive board [of an association] must state the time and place of the meeting and include a copy of the agenda for the meeting or the date on which and the locations where copies of the agenda may be conveniently obtained by the units’ owners . [of the association.] The notice must include notification of the right of a unit’s owner to:

(b) Speak to the association or executive board, unless the executive board is meeting in executive session.

5. The agenda of the meeting of the executive board [of an association] must comply with the provisions of subsection [3] 4 of NRS 116.3108. The period required to be devoted to comments by the units’ owners and discussion of those comments must be scheduled for the beginning of each meeting. In an emergency, the executive board may take action on an item which is not listed on the agenda as an item on which action may be taken.

6. At least once every 90 days, unless the declaration or bylaws of the association impose more stringent standards, the executive board shall review , at a minimum, the following financial information at one of its meetings:

(a) A current [reconciliation of the operating account] year-to-date financial statement of the association;

(b) A current year-to-date schedule of revenues and expenses for the operating account and the reserve account, compared to the budget for those accounts;

(d) A current reconciliation of the reserve account of the association;

[(c) The actual revenues and expenses for the reserve account, compared to the budget for that account for the current year;

(d)] (e) The latest account statements prepared by the financial institutions in which the accounts of the association are maintained;

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ê2005 Statutes of Nevada, Page 2602 (CHAPTER 494, SB 325)ê

[(e) An income and expense statement, prepared on at least a quarterly basis, for the operating and reserve accounts of the association;] and

(f) The current status of any civil action or claim submitted to arbitration or mediation in which the association is a party.

7. The secretary or other officer specified in the bylaws shall cause minutes to be recorded or otherwise taken at each meeting of the executive board. Not more than 30 days after each such meeting, the secretary or other officer specified in the bylaws shall cause the minutes or a summary of the minutes of the meetings to be made available to the units’ owners. A copy of the minutes or a summary of the minutes must be provided to any unit’s owner upon request and, if required by the executive board, upon payment to the association of the cost of providing the copy to the unit’s owner.

8. Except as otherwise provided in subsection 9 and NRS 116.31085, the minutes of each meeting of the executive board must include:

(a) The date, time and place of the meeting;

(b) Those members of the executive board who were present and those members who were absent at the meeting;

(d) A record of each member’s vote on any matter decided by vote at the meeting; and

(e) The substance of remarks made by any unit’s owner who addresses the executive board at the meeting if he requests that the minutes reflect his remarks or, if he has prepared written remarks, a copy of his prepared remarks if he submits a copy for inclusion.

9. The executive board may establish reasonable limitations on materials, remarks or other information to be included in the minutes of its meetings.

10. The association shall maintain the minutes of each meeting of the executive board until the common-interest community is terminated.

11. A unit’s owner may record on audiotape or any other means of sound reproduction a meeting of the executive board, unless the executive board is meeting in executive session, if the unit’s owner, before recording the meeting, provides notice of his intent to record the meeting to the members of the executive board and the other units’ owners who are in attendance at the meeting.

12. As used in this section, “emergency” means any occurrence or combination of occurrences that:

(a) Could not have been reasonably foreseen;

(b) Affects the health, welfare and safety of the units’ owners or residents of the [association;] common-interest community;

(d) Makes it impracticable to comply with the provisions of subsection 2 or 5.

Sec. 65. NRS 116.31085 is hereby amended to read as follows:

116.31085 1. Except as otherwise provided in this section, a unit’s owner may attend any meeting of the units’ owners [of the association] or of the executive board and speak at any such meeting. The executive board may establish reasonable limitations on the time a unit’s owner may speak at such a meeting.

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ê2005 Statutes of Nevada, Page 2603 (CHAPTER 494, SB 325)ê

2. An executive board may not meet in executive session to enter into, renew, modify, terminate or take any other action regarding a contract, unless it is a contract between the association and an attorney.

3. An executive board may meet in executive session only to:

(a) Consult with the attorney for the association on matters relating to proposed or pending litigation if the contents of the discussion would otherwise be governed by the privilege set forth in NRS 49.035 to 49.115, inclusive, or to enter into, renew, modify, terminate or take any other action regarding a contract between the association and the attorney.

(b) Discuss the character, alleged misconduct, professional competence, or physical or mental health of a community manager or an employee of the association.

(c) Except as otherwise provided in subsection 4, discuss a violation of the governing documents, including, without limitation, the failure to pay an assessment.

(d) Discuss the alleged failure of a unit’s owner to adhere to a schedule required pursuant to NRS 116.310305 if the alleged failure may subject the units’ owner to a construction penalty.

4. An executive board shall meet in executive session to hold a hearing on an alleged violation of the governing documents unless the person who may be sanctioned for the alleged violation requests in writing that [the] an open hearing be conducted by the executive board . [at an open meeting. The] If the person who may be sanctioned for the alleged violation [is] requests in writing that an open hearing be conducted, the person:

(a) Is entitled to attend [the hearing and testify concerning the alleged violation, but the person may be excluded by the executive board from any other portion] all portions of the hearing [,] related to the alleged violation, including, without limitation, the presentation of evidence and the testimony of witnesses; and

(b) Is not entitled to attend the deliberations of the executive board.

5. Except as otherwise provided in this subsection, any matter discussed by the executive board when it meets in executive session must be generally noted in the minutes of the meeting of the executive board. The executive board shall maintain minutes of any decision made pursuant to subsection 4 concerning an alleged violation and, upon request, provide a copy of the decision to the person who was subject to being sanctioned at the hearing or to his designated representative.

6. Except as otherwise provided in subsection 4, a unit’s owner is not entitled to attend or speak at a meeting of the executive board held in executive session.

Sec. 66. NRS 116.3115 is hereby amended to read as follows:

116.3115 1. Until the association makes an assessment for common expenses, the declarant shall pay all common expenses. After an assessment has been made by the association, assessments must be made at least annually, based on a budget adopted at least annually by the association in accordance with the requirements set forth in NRS 116.31151. Unless the declaration imposes more stringent standards, the budget must include a budget for the daily operation of the association and [the money] a budget for the [reserve] reserves required by paragraph (b) of subsection 2.

2. Except for assessments under subsections 4 to 7, inclusive:

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ê2005 Statutes of Nevada, Page 2604 (CHAPTER 494, SB 325)ê

(a) All common expenses, including [a reserve,] the reserves, must be assessed against all the units in accordance with the allocations set forth in the declaration pursuant to subsections 1 and 2 of NRS 116.2107.

(b) The association shall establish [an adequate reserve,] adequate reserves, funded on a reasonable basis, for the repair, replacement and restoration of the major components of the common elements. The [reserve] reserves may be used only for those purposes, including, without limitation, repairing, replacing and restoring roofs, roads and sidewalks, and must not be used for daily maintenance. The association may comply with the provisions of this paragraph through a funding plan that is designed to allocate the costs for the repair, replacement and restoration of the major components of the common elements over a period of years if the funding plan is designed in an actuarially sound manner which will ensure that sufficient money is available when the repair, replacement and restoration of the major components of the common elements are necessary.

3. Any past due assessment for common expenses or installment thereof bears interest at the rate established by the association not exceeding 18 percent per year.

4. To the extent required by the declaration:

(a) Any common expense associated with the maintenance, repair, restoration or replacement of a limited common element must be assessed against the units to which that limited common element is assigned, equally, or in any other proportion the declaration provides;

(b) Any common expense or portion thereof benefiting fewer than all of the units must be assessed exclusively against the units benefited; and

(c) The costs of insurance must be assessed in proportion to risk and the costs of utilities must be assessed in proportion to usage.

5. Assessments to pay a judgment against the association may be made only against the units in the common‑interest community at the time the judgment was entered, in proportion to their liabilities for common expenses.

6. If any common expense is caused by the misconduct of any unit’s owner, the association may assess that expense exclusively against his unit.

7. The association of a common‑interest community created before January 1, 1992, is not required to make an assessment against a vacant lot located within the community that is owned by the declarant.

8. If liabilities for common expenses are reallocated, assessments for common expenses and any installment thereof not yet due must be recalculated in accordance with the reallocated liabilities.

9. The association shall provide written notice to [the owner of each unit] each unit’s owner of a meeting at which an assessment for a capital improvement [or the commencement of a civil action] is to be considered or action is to be taken on such an assessment at least 21 calendar days before the date of the meeting. [Except as otherwise provided in this subsection, the association may commence a civil action only upon a vote or written agreement of the owners of units to which at least a majority of the votes of the members of the association are allocated. The provisions of this subsection do not apply to a civil action that is commenced:

(a) To enforce the payment of an assessment;

(b) To enforce the declaration, bylaws or rules of the association;

(d) To protect the health, safety and welfare of the members of the association. If a civil action is commenced pursuant to this paragraph without the required vote or agreement, the action must be ratified within 90 days after the commencement of the action by a vote or written agreement of the owners of the units to which at least a majority of votes of the members of the association are allocated.

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ê2005 Statutes of Nevada, Page 2605 (CHAPTER 494, SB 325)ê

the required vote or agreement, the action must be ratified within 90 days after the commencement of the action by a vote or written agreement of the owners of the units to which at least a majority of votes of the members of the association are allocated. If the association, after making a good faith effort, cannot obtain the required vote or agreement to commence or ratify such a civil action, the association may thereafter seek to dismiss the action without prejudice for that reason only if a vote or written agreement of the owners of the units to which at least a majority of votes of the members of the association are allocated was obtained at the time the approval to commence or ratify the action was sought.

10. At least 10 days before an association commences or seeks to ratify the commencement of a civil action, the association shall provide a written statement to all units’ owners that includes:

(a) A reasonable estimate of the costs of the civil action, including reasonable attorney’s fees;

11. No person other than a unit’s owner may request the dismissal of a civil action commenced by the association on the ground that the association failed to comply with any provision of this section.]

Sec. 67. NRS 116.31151 is hereby amended to read as follows:

116.31151 1. Except as otherwise provided in subsection 2 and unless the declaration of a common-interest community imposes more stringent standards, the executive board [of an association] shall, not less than 30 days or more than 60 days before the beginning of the fiscal year of the association, prepare and distribute to each unit’s owner a copy of:

(a) The budget for the daily operation of the association. The budget must include, without limitation, the estimated annual revenue and expenditures of the association and any contributions to be made to the reserve account of the association.

(b) The budget to [maintain the reserve] provide adequate funding for the reserves required by paragraph (b) of subsection 2 of NRS 116.3115. The budget must include, without limitation:

(1) The current estimated replacement cost, estimated remaining life and estimated useful life of each major component of the common elements;

(2) As of the end of the fiscal year for which the budget is prepared, the current estimate of the amount of cash reserves that are necessary, and the current amount of accumulated cash reserves that are set aside, to repair, replace or restore the major components of the common elements;

(3) A statement as to whether the executive board has determined or anticipates that the levy of one or more special assessments will be [required] necessary to repair, replace or restore any major component of the common elements or to provide adequate funding for the reserves designated for that purpose; and

(4) A general statement describing the procedures used for the estimation and accumulation of cash reserves pursuant to subparagraph (2), including, without limitation, the qualifications of the person responsible for the preparation of the study of the reserves required by NRS 116.31152.

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ê2005 Statutes of Nevada, Page 2606 (CHAPTER 494, SB 325)ê

2. In lieu of distributing copies of the budgets of the association required by subsection 1, the executive board may distribute to each unit’s owner a summary of those budgets, accompanied by a written notice that:

(a) The budgets are available for review at the business office of the association or some other suitable location within the county where the common-interest community is situated or, if it is situated in more than one county, within one of those counties; and

(b) Copies of the budgets will be provided upon request.

3. Within 60 days after adoption of any proposed budget for the common-interest community, the executive board shall provide a summary of the proposed budget to each units’ owner and shall set a date for a meeting of the units’ owners to consider ratification of the proposed budget not less than 14 days or more than 30 days after the mailing of the summaries. Unless at that meeting a majority of all units’ owners, or any larger vote specified in the declaration, reject the proposed budget, the proposed budget is ratified, whether or not a quorum is present. If the proposed budget is rejected, the periodic budget last ratified by the units’ owners must be continued until such time as the units’ owners ratify a subsequent budget proposed by the executive board.

Sec. 68. NRS 116.31152 is hereby amended to read as follows:

116.31152 1. The executive board [of an association] shall:

(a) [Cause] At least once every 5 years, cause to be conducted [, at least once every 5 years,] a study of the reserves required to repair, replace and restore the major components of the common elements;

(b) [Review] At least annually, review the results of that study [at least annually] to determine [if] whether those reserves are sufficient; and

(c) [Make] At least annually, make any adjustments [it] to the association’s funding plan which the executive board deems necessary to [maintain] provide adequate funding for the required reserves.

2. The study of the reserves required by subsection 1 must be conducted by a person who [is qualified by training and experience to conduct such a study, including, without limitation, a member of the executive board, a unit’s owner or a community manager who is so qualified.] holds a permit issued pursuant to sections 2 to 35, inclusive, of this act.

3. The study of the reserves must include, without limitation:

(a) A summary of an inspection of the major components of the common elements that the association is obligated to repair, replace or restore;

(b) An identification of the major components of the common elements that the association is obligated to repair, replace or restore which have a remaining useful life of less than 30 years;

(c) An estimate of the remaining useful life of each major component of the common elements identified pursuant to paragraph (b);

(d) An estimate of the cost of repair, replacement or restoration of each major component of the common elements identified pursuant to paragraph (b) during and at the end of its useful life; and

(e) An estimate of the total annual assessment that may be [required] necessary to cover the cost of repairing, replacement or restoration of the major components of the common elements identified pursuant to paragraph (b), after subtracting the reserves of the association as of the date of the study [.

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ê2005 Statutes of Nevada, Page 2607 (CHAPTER 494, SB 325)ê

3. The results] , and an estimate of the funding plan that may be necessary to provide adequate funding for the required reserves.

4. A summary of the study of the reserves required by subsection 1 must be submitted to the [Commission] Division not later than 45 days after the date that the executive board [of the association] adopts the results of the study.

[4. The Commission shall adopt by regulation the qualifications required for conducting the study of the reserves required by subsection 1.]

5. If a common-interest community was developed as part of a planned unit development pursuant to chapter 278A of NRS and is subject to an agreement with a city or county to receive credit against the amount of the residential construction tax that is imposed pursuant to NRS 278.4983 and 278.4985, the association that is organized for the common-interest community may use the money from that credit for the repair, replacement or restoration of park facilities and related improvements if:

(a) The park facilities and related improvements are identified as major components of the common elements of the association; and

(b) The association is obligated to repair, replace or restore the park facilities and related improvements in accordance with the study of the reserves required by subsection 1.

Sec. 69. NRS 116.31155 is hereby amended to read as follows:

116.31155 1. [An] Except as otherwise provided in subsection 2, an association shall:

(a) If the association is required to pay the fee imposed by NRS 78.150, 82.193 , [or] 86.263, 87.531 or 88.591, pay to the Administrator a fee established by regulation of the Administrator for every unit in the association used for residential use.

(b) If the association is organized as a trust or partnership, or as any other authorized business entity, pay to the Administrator a fee established by regulation of the Administrator for each unit in the association.

2. If an association is subject to the governing documents of a master association, the master association shall pay the fees required pursuant to this section for each unit in the association that is subject to the governing documents of the master association, unless the governing documents of the master association provide otherwise. The provisions of this subsection do not relieve any association that is subject to the governing documents of a master association from its ultimate responsibility to pay the fees required pursuant to this section to the Administrator if they are not paid by the master association.

3. The fees required to be paid pursuant to this section must be:

(a) Paid at such times as are established by the Division.

(b) Deposited with the State Treasurer for credit to the Account for Common-Interest Communities created by NRS 116.630.

(c) Established on the basis of the actual costs of administering the Office of the Ombudsman and the Commission and not on a basis which includes any subsidy beyond those actual costs. In no event may the fees required to be paid pursuant to this section exceed $3 per unit.

[3. The Administrator may by regulation establish]

4. The Division shall impose an administrative penalty [to be imposed] against an association or master association that violates the provisions of this section by failing to pay the fees owed by the association or master association within the times established by the Division. The administrative penalty that is imposed for each violation [may not exceed] must equal 10 percent of the amount of the fees owed by the association or master association or $500, whichever amount is less.

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ê2005 Statutes of Nevada, Page 2608 (CHAPTER 494, SB 325)ê

penalty that is imposed for each violation [may not exceed] must equal 10 percent of the amount of the fees owed by the association or master association or $500, whichever amount is less.

[4.] The amount of the unpaid fees owed by the association or master association bears interest at the rate set forth in NRS 99.040 from the date the fees are due until the date the fees are paid in full.

5. A unit’s owner may not be required to pay any portion of the fees or any administrative penalties or interest required to be paid pursuant to this section to [a] both an association and a master association . [and to an association organized pursuant to NRS 116.3101.

5.] 6. An association that is subject to the governing documents of a master association may not be required to pay any portion of the fees or any administrative penalties or interest required to be paid pursuant to this section to the extent they have already been paid by the master association.

7. A master association may not be required to pay any portion of the fees or any administrative penalties or interest required to be paid pursuant to this section to the extent they have already been paid by an association that is subject to the governing documents of the master association.

8. Upon the payment of the fees and any administrative penalties and interest required by this section, the Administrator shall provide to the association or master association evidence that it paid the fees and the administrative penalties and interest in compliance with this section.

Sec. 70. NRS 116.31162 is hereby amended to read as follows:

116.31162 1. Except as otherwise provided in subsection 4, in a condominium, in a planned community, in a cooperative where the owner’s interest in a unit is real estate under NRS 116.1105, or in a cooperative where the owner’s interest in a unit is personal property under NRS 116.1105 and the declaration provides that a lien may be foreclosed under NRS 116.31162 to 116.31168, inclusive, the association may foreclose its lien by sale after [:] all of the following occur:

(a) The association has mailed by certified or registered mail, return receipt requested, to the unit’s owner or his successor in interest, at his address if known and at the address of the unit, a notice of delinquent assessment which states the amount of the assessments and other sums which are due in accordance with subsection 1 of NRS 116.3116, a description of the unit against which the lien is imposed and the name of the record owner of the unit . [;]

(b) Not less than 30 days after mailing the notice of delinquent assessment pursuant to paragraph (a), the association or other person conducting the sale has executed and caused to be recorded, with the county recorder of the county in which the common-interest community or any part of it is situated, a notice of default and election to sell the unit to satisfy the lien [, which contains] which must contain the same information as the notice of delinquent assessment [, but] and which must also [describe] comply with the following:

(1) Describe the deficiency in payment . [and]

(2) State the name and address of the person authorized by the association to enforce the lien by sale . [and;]

(3) Contain, in 14-point bold type, the following warning:

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ê2005 Statutes of Nevada, Page 2609 (CHAPTER 494, SB 325)ê

WARNING! IF YOU FAIL TO PAY THE AMOUNT SPECIFIED IN THIS NOTICE, YOU COULD LOSE YOUR HOME, EVEN IF THE AMOUNT IS IN DISPUTE!

(c) The unit’s owner or his successor in interest has failed to pay the amount of the lien, including costs, fees and expenses incident to its enforcement, for 90 days following the recording of the notice of default and election to sell.

2. The notice of default and election to sell must be signed by the person designated in the declaration or by the association for that purpose or, if no one is designated, by the president of the association.

3. The period of 90 days begins on the first day following [the later of:] :

(a) The [day] date on which the notice of default is recorded; or

(b) The [day] date on which a copy of the notice of default is mailed by certified or registered mail, return receipt requested, to the unit’s owner or his successor in interest at his address, if known, and at the address of the unit [.] ,

Ê whichever date occurs later.

4. The association may not foreclose a lien by sale based on a fine or penalty for a violation of the governing documents of the association unless:

(a) The violation [threatens] poses an imminent threat of causing a substantial adverse effect on the health, safety or welfare of the units’ owners or residents of the common-interest community; or

(b) The penalty is imposed for failure to adhere to a schedule required pursuant to NRS 116.310305.

Sec. 71. NRS 116.31163 is hereby amended to read as follows:

116.31163 The association or other person conducting the sale shall also mail, within 10 days after the notice of default and election to sell is recorded, a copy of the notice by first-class mail to:

1. Each person who has requested notice pursuant to NRS 107.090 or 116.31168;

2. Any holder of a recorded security interest encumbering the unit’s owner’s interest who has notified the association, 30 days before the recordation of the notice of default, of the existence of the security interest; and

3. A purchaser of the unit, if the unit’s owner has notified the association, 30 days before the recordation of the notice, that the unit is the subject of a contract of sale and the association has been requested to furnish the certificate required by [subsection 2 of] NRS 116.4109.

Sec. 72. NRS 116.311635 is hereby amended to read as follows:

116.311635 1. The association or other person conducting the sale shall also, after the expiration of the 90 days and before selling the unit:

[1.] (a) Give notice of the time and place of the sale in the manner and for a time not less than that required by law for the sale of real property upon execution, except that [a] in lieu of following the procedure for service on a judgment debtor pursuant to NRS 21.130, service must be made on the unit’s owner as follows:

(1) A copy of the notice of sale must be mailed, on or before the date of first publication or posting, by certified or registered mail, return receipt requested, to the unit’s owner or his successor in interest at his address, if known, and to the address of the unit [.

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ê2005 Statutes of Nevada, Page 2610 (CHAPTER 494, SB 325)ê

2.] ; and

(2) A copy of the notice of sale must be served, on or before the date of first publication or posting, in the manner set forth in subsection 2; and

(b) Mail, on or before the date of first publication or posting, a copy of the notice by first-class mail to:

[(a)] (1) Each person entitled to receive a copy of the notice of default and election to sell notice under NRS 116.31163;

[(b)] (2) The holder of a recorded security interest or the purchaser of the unit, if either of them has notified the association, before the mailing of the notice of sale, of the existence of the security interest, lease or contract of sale, as applicable; and

[(c)] (3) The Ombudsman.

2. In addition to the requirements set forth in subsection 1, a copy of the notice of sale must be served:

(a) By a person who is 18 years of age or older and who is not a party to or interested in the sale by personally delivering a copy of the notice of sale to an occupant of the unit who is of suitable age; or

(b) By posting a copy of the notice of sale in a conspicuous place on the unit.

3. Any copy of the notice of sale required to be served pursuant to this section must include:

(a) The amount necessary to satisfy the lien as of the date of the proposed sale; and

(b) The following warning in 14-point bold type:

WARNING! A SALE OF YOUR PROPERTY IS IMMINENT! UNLESS YOU PAY THE AMOUNT SPECIFIED IN THIS NOTICE BEFORE THE SALE DATE, YOU COULD LOSE YOUR HOME, EVEN IF THE AMOUNT IS IN DISPUTE. YOU MUST ACT BEFORE THE SALE DATE. IF YOU HAVE ANY QUESTIONS, PLEASE CALL (name and telephone number of the contact person for the association). IF YOU NEED ASSISTANCE, PLEASE CALL THE FORECLOSURE SECTION OF THE OMBUDSMAN’S OFFICE, NEVADA REAL ESTATE DIVISION, AT (toll-free telephone number designated by the Division) IMMEDIATELY.

4. Proof of service of any copy of the notice of sale required to be served pursuant to this section must consist of:

(a) A certificate of mailing which evidences that the notice was mailed through the United State Postal Service; or

(b) An affidavit of service signed by the person who served the notice stating:

(1) The time of service, manner of service and location of service; and

(2) The name of the person served or, if the notice was not served on a person, a description of the location where the notice was posted on the unit.

Sec. 73. NRS 116.31164 is hereby amended to read as follows:

116.31164 1. The sale must be conducted in the county in which the common-interest community or part of it is situated, and may be conducted by the association, its agent or attorney, or a title insurance company or escrow agent licensed to do business in this State, except that the sale may be made at the office of the association if the notice of the sale so provided, whether the unit is located within the same county as the office of the association or not.

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ê2005 Statutes of Nevada, Page 2611 (CHAPTER 494, SB 325)ê

escrow agent licensed to do business in this State, except that the sale may be made at the office of the association if the notice of the sale so provided, whether the unit is located within the same county as the office of the association or not. The association or other person conducting the sale may from time to time postpone the sale by such advertisement and notice as it considers reasonable or, without further advertisement or notice, by proclamation made to the persons assembled at the time and place previously set and advertised for the sale.

2. On the day of sale originally advertised or to which the sale is postponed, at the time and place specified in the notice or postponement, the person conducting the sale may sell the unit at public auction to the highest cash bidder. Unless otherwise provided in the declaration or by agreement, the association may purchase the unit and hold, lease, mortgage or convey it. The association may purchase by a credit bid up to the amount of the unpaid assessments and any permitted costs, fees and expenses incident to the enforcement of its lien.

3. After the sale, the person conducting the sale shall [make,] :

(a) Make, execute and, after payment is made, deliver to the purchaser, or his successor or assign, a deed without warranty which conveys to the grantee all title of the unit’s owner to the unit [, and shall apply] ;

(b) Deliver a copy of the deed to the Ombudsman within 30 days after the deed is delivered to the purchaser, or his successor or assign; and

[(a)] (1) The reasonable expenses of sale;

[(b)] (2) The reasonable expenses of securing possession before sale, holding, maintaining, and preparing the unit for sale, including payment of taxes and other governmental charges, premiums on hazard and liability insurance, and, to the extent provided for by the declaration, reasonable attorney’s fees and other legal expenses incurred by the association;

[(c)] (3) Satisfaction of the association’s lien;

[(d)] (4) Satisfaction in the order of priority of any subordinate claim of record; and

[(e)] (5) Remittance of any excess to the unit’s owner.

Sec. 74. NRS 116.31168 is hereby amended to read as follows:

116.31168 1. The provisions of NRS 107.090 apply to the foreclosure of an association’s lien as if a deed of trust were being foreclosed. The request must identify the lien by stating the names of the unit’s owner and the common-interest community.

2. An association may, after recording a notice of default and election to sell, waive the default and withdraw the notice or any proceeding to foreclose. The association is thereupon restored to its former position and has the same rights as though the notice had not been recorded.

Sec. 74.5. NRS 116.31185 is hereby amended to read as follows:

116.31185 [A]

1. Except as otherwise provided in subsection 2, a member of an executive board, an officer of an association or a community manager shall not solicit or accept any form of compensation, gratuity or other remuneration that:

[1.] (a) Would improperly influence or would appear to a reasonable person to improperly influence the decisions made by those persons; or

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ê2005 Statutes of Nevada, Page 2612 (CHAPTER 494, SB 325)ê

[2.] (b) Would result or would appear to a reasonable person to result in a conflict of interest for those persons.

2. Notwithstanding the provisions of subsection 1, a member of an executive board, an officer of an association, a community manager or any person working for a community manager shall not accept, directly or indirectly, any gifts, incentives, gratuities, rewards or other items of value from:

(a) An attorney, law firm or vendor, or any person working directly or indirectly for the attorney, law firm or vendor, which total more than the amount established by the Commission by regulation, not to exceed $100 per year per such attorney, law firm or vendor; or

(b) A declarant, an affiliate of a declarant or any person responsible for the construction of the applicable community or association which total more than the amount established by the Commission by regulation, not to exceed $100 per year per such declarant, affiliate or person.

3. An attorney, law firm or vendor, or any person working directly or indirectly for the attorney, law firm or vendor, shall not provide, directly or indirectly, any gifts, incentives, gratuities, rewards or other items of value to a member of the executive board, an officer of the association, the community manager or any person working for the community manger which total more than the amount established by the Commission by regulation, not to exceed $100 per year per such member, officer, community manager or person.

4. A declarant, an affiliate of a declarant or any person responsible for the construction of a community or association, shall not provide, directly or indirectly, any gifts, incentives, gratuities, rewards or other items of value to a member of the executive board, an officer of the association, the community manager or any person working for the community manger which total more than the amount established by the Commission by regulation, not to exceed $100 per year per such member, officer, community manager or person.

Sec. 75. NRS 116.4103 is hereby amended to read as follows:

116.4103 1. Except as otherwise provided in NRS 116.41035, a public offering statement must set forth or fully and accurately disclose each of the following:

(a) The name and principal address of the declarant and of the common‑interest community, and a statement that the common‑interest community is either a condominium, cooperative or planned community.

(b) A general description of the common‑interest community, including to the extent possible, the types, number and declarant’s schedule of commencement and completion of construction of buildings, and amenities that the declarant anticipates including in the common‑interest community.

(d) Copies of the declaration, bylaws, and any rules or regulations of the association, but a plat or plan is not required.

(e) A current year-to-date financial statement , including the most recent audited or reviewed financial statement, and the projected budget for the association, either within or as an exhibit to the public offering statement, for 1 year after the date of the first conveyance to a purchaser, and thereafter the current budget of the association. The budget must include, without limitation:

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ê2005 Statutes of Nevada, Page 2613 (CHAPTER 494, SB 325)ê

(1) A statement of the amount included in the budget as [a reserve] reserves for repairs, replacement and restoration [;] pursuant to NRS 116.3115; and

(2) The projected monthly assessment for common expenses for each type of unit, including the amount established as [a reserve] reserves pursuant to NRS 116.3115.

(f) A description of any services or subsidies being provided by the declarant or an affiliate of the declarant, not reflected in the budget.

(g) Any initial or special fee due from the purchaser at closing, together with a description of the purpose and method of calculating the fee.

(h) The terms and significant limitations of any warranties provided by the declarant, including statutory warranties and limitations on the enforcement thereof or on damages.

(i) A statement that unless the purchaser or his agent has personally inspected the unit, the purchaser may cancel, by written notice, his contract for purchase until midnight of the fifth calendar day following the date of execution of the contract, and the contract must contain a provision to that effect.

(j) A statement of any unsatisfied judgments or pending suits against the association, and the status of any pending suits material to the common-interest community of which a declarant has actual knowledge.

(k) Any current or expected fees or charges to be paid by units’ owners for the use of the common elements and other facilities related to the common‑interest community.

(l) The information statement set forth in NRS 116.41095.

2. A declarant is not required to revise a public offering statement more than once each calendar quarter, if the following warning is given prominence in the statement: “THIS PUBLIC OFFERING STATEMENT IS CURRENT AS OF (insert a specified date). RECENT DEVELOPMENTS REGARDING (here refer to particular provisions of NRS 116.4103 and 116.4105) MAY NOT BE REFLECTED IN THIS STATEMENT.”

Sec. 75.5. NRS 116.4106 is hereby amended to read as follows:

116.4106 1. The public offering statement of a common‑interest community containing any converted building must contain, in addition to the information required by NRS 116.4103 and 116.41035:

(a) A statement by the declarant, based on a report prepared by an independent registered architect or licensed professional engineer, describing the present condition of all structural components and mechanical and electrical installations material to the use and enjoyment of the building;

(b) [A statement by the declarant of the expected useful life of each item reported in paragraph (a) or a statement that no representations are made in that regard; and

(c)] A list of any outstanding notices of uncured violations of building codes or other municipal regulations, together with the estimated cost of curing those violations [.] ; and

(c) The budget to maintain the reserves required pursuant to paragraph (b) of subsection 2 of NRS 116.3115 which must include, without limitation:

(1) The current estimated replacement cost, estimated remaining life and estimated useful life of each major component of the common elements;

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ê2005 Statutes of Nevada, Page 2614 (CHAPTER 494, SB 325)ê

(2) As of the end of the fiscal year for which the budget was prepared, the current estimate of the amount of cash reserves that are necessary to repair, replace and restore the major components of the common elements and the current amount of accumulated cash reserves that are set aside for such repairs, replacements and restorations;

(3) A statement as to whether the declarant has determined or anticipates that the levy of one or more special assessments will be required within the next 10 years to repair, replace and restore any major component of the common elements or to provide adequate reserves for that purpose;

(4) A general statement describing the procedures used for the estimation and accumulation of cash reserves described in subparagraph (2), including, without limitation, the qualifications of the person responsible for the preparation of the study of reserves required pursuant to NRS 116.31152; and

(5) The funding plan that is designed to allocate the costs for the repair, replacement and restoration of the major components of the common elements over a period of years.

2. This section applies only to a common-interest community comprised of a converted building or buildings containing more than 12 units that may be occupied for residential use.

Sec. 76. NRS 116.4109 is hereby amended to read as follows:

116.4109 1. Except in the case of a sale in which delivery of a public offering statement is required, or unless exempt under subsection 2 of NRS 116.4101, a unit’s owner or his authorized agent shall furnish to a purchaser [before an offer to purchase a unit becomes binding on the purchaser:] a resale package containing all of the following:

(a) A copy of the declaration, other than any plats and plans, the bylaws, the rules or regulations of the association and the information statement required by NRS 116.41095;

(b) A statement setting forth the amount of the monthly assessment for common expenses and any unpaid assessment of any kind currently due from the selling unit’s owner;

(c) [The] A copy of the current operating budget of the association and [a] current year-to-date financial statement for the association, which must include a summary of the [financial components of the study of the] reserves of the association required by NRS 116.31152 [;] and which must include, without limitation, a summary of the information described in paragraphs (a) to (e), inclusive, of subsection 3 of NRS 116.31152; and

(d) A statement of any unsatisfied judgments or pending legal actions against the association and the status of any pending legal actions relating to the common-interest community of which the unit’s owner has actual knowledge.

2. The [association, within] purchaser may, by written notice, cancel the contract of purchase until midnight of the fifth calendar day following the date of receipt of the resale package described in subsection 1, and the contract for purchase must contain a provision to that effect. If the purchaser elects to cancel a contract pursuant to this subsection, he must hand deliver the notice of cancellation to the unit’s owner or his authorized agent or mail the notice of cancellation by prepaid United States mail to the unit’s owner or his authorized agent. Cancellation is without penalty, and all payments made by the purchaser before cancellation must be refunded promptly.

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ê2005 Statutes of Nevada, Page 2615 (CHAPTER 494, SB 325)ê

cancellation must be refunded promptly. If the purchaser has accepted a conveyance of the unit, the purchaser is not entitled to:

(a) Cancel the contract pursuant to this subsection; or

(b) Damages, rescission or other relief based solely on the ground that the unit’s owner or his authorized agent failed to furnish the resale package, or any portion thereof, as required by this section.

3. Within 10 days after receipt of a written request by the unit’s owner or his authorized agent, the association shall furnish [a certificate containing the] all of the following to the unit’s owner or his authorized agent for inclusion in the resale package:

(a) Copies of the documents required pursuant to paragraphs (a) and (c) of subsection 1; and

(b) A certificate containing the information necessary to enable the unit’s owner to comply with paragraphs (b) and (d) of subsection 1. [A unit’s owner providing a]

4. If the association furnishes the documents and certificate pursuant to subsection [1 is not] 3:

(a) The unit’s owner or his authorized agent shall include the documents and certificate in the resale package provided to the purchaser, and neither the unit’s owner nor his authorized agent is liable to the purchaser for any erroneous information provided by the association and included in the documents and certificate.

[3.] (b) The association may charge the unit’s owner a reasonable fee to cover the cost of preparing the certificate furnished pursuant to subsection 3. Such a fee must be based on the actual cost the association incurs to fulfill the requirements of this section in preparing the certificate. The Commission shall adopt regulations establishing the maximum amount of the fee that an association may charge for preparing the certificate.

(c) The association may charge the unit’s owner a reasonable fee, not to exceed 25 cents per page, to cover the cost of copying the other documents furnished pursuant to subsection 3.

(d) Except for the fees allowed pursuant to paragraphs (b) and (c), the association may not charge the unit’s owner any other fees for preparing or furnishing the documents and certificate pursuant to subsection 3.

5. Neither a purchaser nor the purchaser’s interest in a unit is liable for any unpaid assessment or fee greater than the amount set forth in the documents and certificate prepared by the association. If the association fails to furnish the documents and certificate within the 10 days allowed by [subsection 2,] this section, the seller is not liable for the delinquent assessment.

[4.] 6. Upon the request of a unit’s owner [,] or his authorized agent, or upon the request of a purchaser to whom the unit’s owner has provided a resale package pursuant to [subsection 1] this section, or his authorized agent , [of the unit’s owner or the purchaser] the association shall make the entire study of the reserves of the association which is required by NRS 116.31152 reasonably available for the unit’s owner, purchaser or authorized agent to inspect, examine, photocopy and audit. The study must be made available at the business office of the association or some other suitable location within the county where the common-interest community is situated or, if it is situated in more than one county, within one of those counties.

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ê2005 Statutes of Nevada, Page 2616 (CHAPTER 494, SB 325)ê

Sec. 77. NRS 116.41095 is hereby amended to read as follows:

116.41095 The information statement required by NRS 116.4103 and 116.4109 must be in substantially the following form:

BEFORE YOU PURCHASE PROPERTY IN A

COMMON-INTEREST COMMUNITY

DID YOU KNOW . . .

1. YOU GENERALLY HAVE 5 DAYS TO CANCEL THE PURCHASE AGREEMENT?

When you enter into a purchase agreement to buy a home or unit in a common-interest community, in most cases you should receive either a public offering statement, if you are the original purchaser of the home or unit, or a resale package, if you are not the original purchaser. The law generally provides for a 5-day period in which you have the right to cancel the purchase agreement. The 5-day period begins on different starting dates, depending on whether you receive a public offering statement or a resale package. Upon receiving a public offering statement or a resale package, you should make sure you are informed of the deadline for exercising your right to cancel. In order to exercise your right to cancel, the law generally requires that you hand deliver the notice of cancellation to the seller within the 5-day period, or mail the notice of cancellation to the seller by prepaid United States mail within the 5-day period. For more information regarding your right to cancel, see Nevada Revised Statutes 116.4108, if you received a public offering statement, or Nevada Revised Statutes 116.4109, if you received a resale package.

2. YOU ARE AGREEING TO RESTRICTIONS ON HOW YOU CAN USE YOUR PROPERTY?

These restrictions are contained in a document known as the Declaration of Covenants, Conditions and Restrictions [(C, C & R’s) that should be provided for your review before making your purchase. The C, C & R’s] . The CC&Rs become a part of the title to your property. They bind you and every future owner of the property whether or not you have read them or had them explained to you. The [C, C & R’s,] CC&Rs, together with other “governing documents” (such as association bylaws and rules and regulations), are intended to preserve the character and value of properties in the community, but may also restrict what you can do to improve or change your property and limit how you use and enjoy your property. By purchasing a property encumbered by [C, C & R’s,] CC&Rs, you are agreeing to limitations that could affect your lifestyle and freedom of choice. You should review the [C, C & R’s,] CC&Rs, and other governing documents before purchasing to make sure that these limitations and controls are acceptable to you.

[2.] 3. YOU WILL HAVE TO PAY OWNERS’ ASSESSMENTS FOR AS LONG AS YOU OWN YOUR PROPERTY?

As an owner in a common-interest community, you are responsible for paying your share of expenses relating to the common elements, such as landscaping, shared amenities and the operation of any [homeowner’s] homeowners’ association. The obligation to pay these assessments binds you and every future owner of the property. Owners’ fees are usually assessed by the [homeowner’s] homeowners’ association and due monthly. You have to pay dues whether or not you agree with the way the association is managing the property or spending the assessments. The executive board of the association may have the power to change and increase the amount of the assessment and to levy special assessments against your property to meet extraordinary expenses.

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ê2005 Statutes of Nevada, Page 2617 (CHAPTER 494, SB 325)ê

association may have the power to change and increase the amount of the assessment and to levy special assessments against your property to meet extraordinary expenses. In some communities, major components of the common elements of the community such as roofs and private roads must be maintained and replaced by the association. If the association is not well managed or fails to [maintain] provide adequate funding for reserves to repair, replace and restore common elements, you may be required to pay large, special assessments to accomplish these tasks.

[3.] 4. IF YOU FAIL TO PAY OWNERS’ ASSESSMENTS, YOU COULD LOSE YOUR HOME?

If you do not pay these assessments when due, the association usually has the power to collect them by selling your property in a nonjudicial foreclosure sale. If fees become delinquent, you may also be required to pay penalties and the association’s costs and attorney’s fees to become current. If you dispute the obligation or its amount, your only remedy to avoid the loss of your home may be to file a lawsuit and ask a court to intervene in the dispute.

[4.] 5. YOU MAY BECOME A MEMBER OF A [HOMEOWNER’S] HOMEOWNERS’ ASSOCIATION THAT HAS THE POWER TO AFFECT HOW YOU USE AND ENJOY YOUR PROPERTY?

Many common-interest communities have a [homeowner’s] homeowners’ association. In a new development, the association will usually be controlled by the developer until a certain number of units have been sold. After the period of developer control, the association may be controlled by property owners like yourself who are elected by homeowners to sit on an executive board and other boards and committees formed by the association. The association, and its executive board, are responsible for assessing homeowners for the cost of operating the association and the common or shared elements of the community and for the day to day operation and management of the community. Because homeowners sitting on the executive board and other boards and committees of the association may not have the experience or professional background required to understand and carry out the responsibilities of the association properly, the association may hire professional community managers to carry out these responsibilities.

[Homeowner’s] Homeowners’ associations operate on democratic principles. Some decisions require all homeowners to vote, some decisions are made by the executive board or other boards or committees established by the association or governing documents. Although the actions of the association and its executive board are governed by state laws, the [C, C & R’s] CC&Rs and other documents that govern the common-interest community, decisions made by these persons will affect your use and enjoyment of your property, your lifestyle and freedom of choice, and your cost of living in the community. You may not agree with decisions made by the association or its governing bodies even though the decisions are ones which the association is authorized to make. Decisions may be made by a few persons on the executive board or governing bodies that do not necessarily reflect the view of the majority of homeowners in the community. If you do not agree with decisions made by the association, its executive board or other governing bodies, your remedy is typically to attempt to use the democratic processes of the association to seek the election of members of the executive board or other governing bodies that are more responsive to your needs. If [persons controlling the association or its management are not complying with state laws or the governing documents, your remedy is typically to seek] you have a dispute with the association, its executive board or other governing bodies, you may be able to resolve the dispute through the complaint, investigation and intervention process administered by the Office of the Ombudsman for Owners in Common-Interest Communities, the Nevada Real Estate Division and the Commission for Common Interest Communities.

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ê2005 Statutes of Nevada, Page 2618 (CHAPTER 494, SB 325)ê

laws or the governing documents, your remedy is typically to seek] you have a dispute with the association, its executive board or other governing bodies, you may be able to resolve the dispute through the complaint, investigation and intervention process administered by the Office of the Ombudsman for Owners in Common-Interest Communities, the Nevada Real Estate Division and the Commission for Common Interest Communities. However, to resolve some disputes, you may have to mediate or arbitrate the dispute and, if mediation or arbitration is unsuccessful, you may have to file a lawsuit and ask a court to resolve the dispute. In addition to your personal cost in mediation or arbitration, or to prosecute a lawsuit, you may be responsible for paying your share of the association’s cost in defending against your claim. [There is no government agency in this State that investigates or intervenes to resolve disputes in homeowner’s associations.

5.] 6. YOU ARE REQUIRED TO PROVIDE PROSPECTIVE [BUYERS] PURCHASERS OF YOUR PROPERTY WITH INFORMATION ABOUT LIVING IN YOUR COMMON-INTEREST COMMUNITY?

The law requires you to provide [to] a prospective purchaser of your property [, before you enter into a purchase agreement,] with a copy of the community’s governing documents, including the [C, C & R’s,] CC&Rs, association bylaws, and rules and regulations, as well as a copy of this document. You are also required to provide a copy of the association’s current year-to-date financial statement, including, without limitation, the most recent audited or reviewed financial statement, a copy of the association’s operating budget and information regarding the amount of the monthly assessment for common expenses, including the amount set aside as reserves for the repair, replacement and restoration of common elements. You are also required to inform prospective purchasers of any outstanding judgments or lawsuits pending against the association of which you are aware. [You are also required to provide a copy of the minutes from the most recent meeting of the homeowner’s association or its executive board.] For more information regarding these requirements, see Nevada Revised Statutes [116.4103 and] 116.4109.

[6.] 7. YOU HAVE CERTAIN RIGHTS REGARDING OWNERSHIP IN A COMMON-INTEREST COMMUNITY THAT ARE GUARANTEED YOU BY THE STATE?

Pursuant to provisions of chapter 116 of Nevada Revised Statutes, you have the right:

(a) To be notified of all meetings of the association and its executive board, except in cases of emergency.

(b) To attend and speak at all meetings of the association and its executive board, except in some cases where the executive board is authorized to meet in closed, executive session.

(d) To inspect, examine, photocopy and audit financial and other records of the association.

(e) To be notified of all changes in the community’s rules and regulations and other actions by the association or board that affect you.

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ê2005 Statutes of Nevada, Page 2619 (CHAPTER 494, SB 325)ê

[7.] 8. QUESTIONS?

Although they may be voluminous, you should take the time to read and understand the documents that will control your ownership of a property in a common-interest community. You may wish to ask your real estate professional, lawyer or other person with experience to explain anything you do not understand. You may also request assistance from the Office of the Ombudsman for Owners in Common-Interest Communities, Nevada Real Estate Division, at (telephone number).

Buyer or prospective buyer’s initials:_____

Date:_____

Sec. 78. NRS 116.600 is hereby amended to read as follows:

116.600 1. The Commission for Common-Interest Communities is hereby created.

2. The Commission consists of five members appointed by the Governor. The Governor shall appoint to the Commission:

(a) One member who is a unit’s owner residing in this State and who has served as a member of an executive board in this State;

(b) One member who is in the business of developing common-interest communities in this State;

(d) One member who is a certified public accountant licensed to practice in this State pursuant to the provisions of chapter 628 of NRS; and

(e) One member who is an attorney licensed to practice in this State.

3. Each member of the Commission must be a resident of this State. At least three members of the Commission must be residents of a county whose population is 400,000 or more.

4. Each member of the Commission must have resided in a common-interest community or have been actively engaged in a business or profession related to common-interest communities for not less than 3 years immediately preceding the date of his appointment.

5. After the initial terms, each member of the Commission serves a term of 3 years. Each member may serve not more than two consecutive full terms. If a vacancy occurs during a member’s term, the Governor shall appoint a person qualified under this section to replace the member for the remainder of the unexpired term.

6. While engaged in the business of the Commission, each member is entitled to receive:

(a) A salary of not more than $80 per day, as established by the Commission; and

(b) The per diem allowance and travel expenses provided for state officers and employees generally.

Sec. 79. NRS 116.615 is hereby amended to read as follows:

116.615 1. The provisions of this chapter [shall] must be administered by the Division, subject to the administrative supervision of the [Commission.] Director of the Department of Business and Industry.

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ê2005 Statutes of Nevada, Page 2620 (CHAPTER 494, SB 325)ê

3. The Commission or the Administrator, with the approval of the Commission, may adopt such regulations as are necessary to carry out the provisions of this chapter.

6. All regulations adopted by the Commission, or adopted by the Administrator with the approval of the Commission, must be published by the Division , posted on its website and offered for sale at a reasonable fee.

[7. The Division may publish or supply a reference manual or study guide for community managers and may offer it for sale at a reasonable fee.]

Sec. 79.5. NRS 116.745 is hereby amended to read as follows:

116.745 As used in NRS 116.745 to 116.795, inclusive, and section 47.6 of this act, unless the context otherwise requires, “violation” means a violation of any provision of this chapter, any regulation adopted pursuant thereto or any order of the Commission or a hearing panel.

Sec. 80. NRS 116.750 is hereby amended to read as follows:

116.750 1. In carrying out the provisions of NRS 116.745 to 116.795, inclusive, and section 47.6 of this act, the Division and the Ombudsman have jurisdiction to investigate and the Commission and each hearing panel has jurisdiction to take appropriate action against any person who commits a violation, including, without limitation:

(a) Any association and any officer, employee or agent of an association.

(b) Any member of an executive board.

(d) Any person who holds a permit to conduct a study of the reserves of an association issued pursuant to sections 2 to 35, inclusive, of this act.

(e) Any declarant or affiliate of a declarant.

[(e)] (f) Any unit’s owner.

[(f)] (g) Any tenant of a unit’s owner if the tenant has entered into an agreement with the unit’s owner to abide by the governing documents of the association and the provisions of this chapter and any regulations adopted pursuant thereto.

2. The jurisdiction set forth in subsection 1 applies to any officer, employee or agent of an association or any member of an executive board who commits a violation and who:

(a) Currently holds his office, employment, agency or position or who held his office, employment, agency or position at the commencement of proceedings against him.

(b) Resigns his office, employment, agency or position:

(1) After the commencement of proceedings against him; or

(2) Within 1 year after the violation is discovered or reasonably should have been discovered.

Sec. 81. NRS 116.760 is hereby amended to read as follows:

116.760 1. Except as otherwise provided in this section, a person who is aggrieved by an alleged violation may, not later than 1 year after the person discovers or reasonably should have discovered the alleged violation, file with the Division a written affidavit that sets forth the facts constituting the alleged violation.

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ê2005 Statutes of Nevada, Page 2621 (CHAPTER 494, SB 325)ê

person discovers or reasonably should have discovered the alleged violation, file with the Division a written affidavit that sets forth the facts constituting the alleged violation. The affidavit may allege any actual damages suffered by the aggrieved person as a result of the alleged violation.

2. An aggrieved person may not file such an affidavit unless the aggrieved person has [, on at least two separate occasions,] provided the respondent by certified mail, return receipt requested, with written [notices] notice of the alleged violation set forth in the affidavit. The [notices] notice must:

(a) Be mailed to the respondent’s last known address.

(b) [Be mailed at least 15 days apart.

(c)] Specify, in reasonable detail, the alleged violation, any actual damages suffered by the aggrieved person as a result of the alleged violation, and any corrective action proposed by the aggrieved person.

3. A written affidavit filed with the Division pursuant to this section must be:

(a) On a form prescribed by the Division.

(b) Be accompanied by evidence that:

(1) The respondent has been given a reasonable opportunity after receiving the written [notices] notice to correct the alleged violation; and

(2) Reasonable efforts to resolve the alleged violation have failed.

4. The Commission or a hearing panel may impose an administrative fine of not more than $1,000 against any person who knowingly files a false or fraudulent affidavit with the Division.

Sec. 82. NRS 116.790 is hereby amended to read as follows:

116.790 1. If the Commission or a hearing panel, after notice and hearing, finds that the executive board [of an association] or any person acting on behalf of the association has committed a violation, the Commission or the hearing panel may take any or all of the following actions:

[1.] (a) Order an audit of the association.

[2.] (b) Require the executive board to hire a community manager who holds a [permit or] certificate.

2. The Commission or the Division, with the approval of the Commission, may apply to a court of competent jurisdiction for the appointment of a receiver for an association if, after notice and a hearing, the Commission or a hearing officer finds that any of the following violations occurred:

(a) The executive board, or any member thereof, has been guilty of fraud or collusion or gross mismanagement in the conduct or control of its affairs;

(b) The executive board, or any member thereof, has been guilty of misfeasance, malfeasance or nonfeasance; or

(c) The assets of the association are in danger of waste or loss through attachment, foreclosure, litigation or otherwise.

3. In any application for the appointment of a receiver pursuant to this section, notice of a temporary appointment of a receiver may be given to the association alone, by process as in the case of an application for a temporary restraining order or injunction. The hearing thereon may be had after 5 days’ notice unless the court directs a longer or different notice and different parties.

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ê2005 Statutes of Nevada, Page 2622 (CHAPTER 494, SB 325)ê

4. The court may, if good cause exists, appoint one or more receivers pursuant to this section to carry out the business of the association. The members of the executive board who have not been guilty of negligence or active breach of duty must be preferred in making the appointment.

5. The powers of any receiver appointed pursuant to this section may be continued as long as the court deems necessary and proper. At any time, for sufficient cause, the court may order the receivership terminated.

6. Any receiver appointed pursuant to this section has, among the usual powers, all the functions, powers, tenure and duties to be exercised under the direction of the court as are conferred on receivers and as provided in NRS 78.635, 78.640 and 78.645, whether or not the association is insolvent. Such powers include, without limitation, the powers to:

(a) Take charge of the estate and effects of the association;

(b) Appoint an agent or agents;

(c) Collect any debts and property due and belonging to the association and prosecute and defend, in the name of the association, or otherwise, any civil action as may be necessary or proper for the purposes of collecting debts and property;

(d) Perform any other act in accordance with the governing documents of the association and this chapter that may be necessary for the association to carry out its obligations; and

(e) By injunction, restrain the association from exercising any of its powers or doing business in any way except by and through a receiver appointed by the court.

Sec. 82.3. NRS 116.795 is hereby amended to read as follows:

116.795 1. If the Commission or the Division has reasonable cause to believe, based on evidence satisfactory to it, that any person [has committed a violation or will continue to commit violations,] violated or is about to violate any provision of this chapter, any regulation adopted pursuant thereto or any order, decision, demand or requirement of the Commission or Division or a hearing panel, the Commission or the Division may bring an action in the district court for the county in which the person resides or, if the person does not reside in this State, in any court of competent jurisdiction [in] within or outside this State, to restrain or enjoin that person from engaging in or continuing to commit the violations or from doing any act in furtherance of the violations.

3. The court may issue the temporary restraining order, preliminary injunction or final injunction without:

(a) Proof of actual damages sustained by any person.

(b) The filing of any bond.

Sec. 82.6. Chapter 119 of NRS is hereby amended by adding thereto a new section to read as follows:

It is unlawful for a developer to sell any lot, parcel, unit or interest in a subdivision without complying with the provisions of NRS 116.4106, if applicable.

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ê2005 Statutes of Nevada, Page 2623 (CHAPTER 494, SB 325)ê

Sec. 83. NRS 78.045 is hereby amended to read as follows:

78.045 1. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the laws of this State which provides that the name of the corporation contains the word “bank” or “trust,” unless:

(a) It appears from the articles or the certificate of amendment that the corporation proposes to carry on business as a banking or trust company, exclusively or in connection with its business as a bank, savings and loan association or thrift company; and

(b) The articles or certificate of amendment is first approved by the Commissioner of Financial Institutions.

2. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the provisions of this chapter if it appears from the articles or the certificate of amendment that the business to be carried on by the corporation is subject to supervision by the Commissioner of Insurance or by the Commissioner of Financial Institutions, unless the articles or certificate of amendment is approved by the Commissioner who will supervise the business of the corporation.

3. Except as otherwise provided in subsection 6, the Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the laws of this State if the name of the corporation contains the words “engineer,” “engineered,” “engineering,” “professional engineer,” “registered engineer” or “licensed engineer” unless:

(a) The State Board of Professional Engineers and Land Surveyors certifies that the principals of the corporation are licensed to practice engineering pursuant to the laws of this State; or

(b) The State Board of Professional Engineers and Land Surveyors certifies that the corporation is exempt from the prohibitions of NRS 625.520.

4. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed pursuant to the laws of this State which provides that the name of the corporation contains the word “accountant,” “accounting,” “accountancy,” “auditor” or “auditing” unless the Nevada State Board of Accountancy certifies that the corporation:

(a) Is registered pursuant to the provisions of chapter 628 of NRS; or

(b) Has filed with the Nevada State Board of Accountancy under penalty of perjury a written statement that the corporation is not engaged in the practice of accounting and is not offering to practice accounting in this State.

5. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing pursuant to the laws of this State which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

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ê2005 Statutes of Nevada, Page 2624 (CHAPTER 494, SB 325)ê

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

6. The provisions of subsection 3 do not apply to any corporation, whose securities are publicly traded and regulated by the Securities Exchange Act of 1934, which does not engage in the practice of professional engineering.

7. The Commissioner of Financial Institutions and the Commissioner of Insurance may approve or disapprove the articles or amendments referred to them pursuant to the provisions of this section.

Sec. 84. Chapter 81 of NRS is hereby amended by adding thereto the provisions set forth as sections 85, 86 and 87 of this act.

Sec. 85. 1. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed under the provisions of this section and NRS 81.010 to 81.160, inclusive, which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment of articles of incorporation that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

2. Upon notification from the Administrator of the Real Estate Division of the Department of Business and Industry that a corporation which is a unit-owners’ association as defined in NRS 116.011 has failed to register pursuant to NRS 116.31158 or failed to pay the fees pursuant to NRS 116.31155, the Secretary of State shall deem the corporation to be in default. If, after the corporation is deemed to be in default, the Administrator notifies the Secretary of State that the corporation has registered pursuant to NRS 116.31158 and paid the fees pursuant to NRS 116.31155, the Secretary of State shall reinstate the corporation if the corporation complies with the requirements for reinstatement as provided in this section and NRS 78.180 and 78.185.

Sec. 86. 1. The Secretary of State shall not accept for filing any articles of association or any certificate of amendment of articles of association of any association formed under the provisions of NRS 81.170 to 81.270, inclusive, and this section which provides that the name of the association contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of association or certificate of amendment of articles of association that the purpose of the association is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the association has:

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ê2005 Statutes of Nevada, Page 2625 (CHAPTER 494, SB 325)ê

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

2. Upon notification from the Administrator of the Real Estate Division of the Department of Business and Industry that an association which is a unit-owners’ association as defined in NRS 116.011 has failed to register pursuant to NRS 116.31158 or failed to pay the fees pursuant to NRS 116.31155, the Secretary of State shall deem the association to be in default. If, after the association is deemed to be in default, the Administrator notifies the Secretary of State that the association has registered pursuant to NRS 116.31158 and paid the fees pursuant to NRS 116.31155, the Secretary of State shall reinstate the association if the association complies with the requirements for reinstatement as provided in this section and NRS 78.180 and 78.185 and pays the fees required pursuant to NRS 82.193.

Sec. 87. 1. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed under the provisions of NRS 81.410 to 81.540, inclusive, and this section which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment of articles of incorporation that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

Sec. 88. NRS 81.010 is hereby amended to read as follows:

81.010 1. Nonprofit cooperative corporations may be formed by the voluntary association of any three or more persons in the manner prescribed in NRS 81.010 to 81.160, inclusive [.] , and section 85 of this act. A majority of the persons must be residents of this State, and such a corporation has and may exercise the powers necessarily incident thereto. Except as otherwise provided in subsection 2, the provisions of chapter 78 of NRS govern each nonprofit cooperative corporation organized pursuant to NRS 81.010 to 81.160, inclusive [.]

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ê2005 Statutes of Nevada, Page 2626 (CHAPTER 494, SB 325)ê

NRS 81.010 to 81.160, inclusive [.] , and section 85 of this act. If such a nonprofit cooperative corporation is organized without shares of stock, the members shall be deemed to be “shareholders” or “stockholders” as these terms are used in chapter 78 of NRS.

2. If the term for which a nonprofit cooperative corporation was to exist has expired but the corporation has continued to perform the activities authorized by its original articles of incorporation or any amendment thereto, revival of its corporate existence does not require the consent of its members or stockholders. Each required action to accomplish a revival may be taken by a majority of the surviving directors. The revival is effective as of the date of expiration of the original term.

Sec. 89. NRS 81.170 is hereby amended to read as follows:

81.170 1. NRS 81.170 to 81.270, inclusive, and section 86 of this act being passed to promote association for mutual welfare, the words “lawful business” extend to every kind of lawful effort for business, education, industrial, benevolent, social or political purposes, whether conducted for profit or not.

2. NRS 81.170 to 81.270, inclusive, and section 86 of this act must not be strictly construed, but their provisions must at all times be liberally construed with a view to effect their object and to promote their purposes.

Sec. 90. NRS 81.200 is hereby amended to read as follows:

81.200 1. Each association formed under NRS 81.170 to 81.270, inclusive, and section 86 of this act shall prepare articles of association in writing, setting forth:

(a) The name of the association.

(b) The purpose for which it is formed.

(c) The name of the person designated as the resident agent, the street address for service of process, and the mailing address if different from the street address.

(d) The term for which it is to exist, which may be perpetual.

(e) The names and addresses, either residence or business, of the directors selected for the first year.

(f) The amount which each member is to pay upon admission as a fee for membership, and that each member signing the articles has actually paid the fee.

(g) That the interest and right of each member therein is to be equal.

(h) The name and address, either residence or business, of each of the persons signing the articles of association.

2. The articles of association must be signed by the original associates or members.

3. The articles so signed must be filed, together with a certificate of acceptance of appointment signed by the resident agent for the association, in the Office of the Secretary of State . [, who shall furnish a certified copy thereof.] From the time of the filing in the Office of the Secretary of State, the association may exercise all the powers for which it was formed.

Sec. 91. NRS 81.410 is hereby amended to read as follows:

81.410 1. Nonprofit cooperative corporations may be formed by the voluntary association of any three or more persons in the manner prescribed in NRS 81.410 to 81.540, inclusive [.] , and section 87 of this act.

2. Except as otherwise provided in subsection 3, the provisions of chapter 82 of NRS govern a nonprofit cooperative corporation organized pursuant to NRS 81.410 to 81.540, inclusive, and section 87 of this act, except to the extent that the provisions of chapter 82 of NRS are inconsistent with NRS 81.410 to 81.540, inclusive [.]

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ê2005 Statutes of Nevada, Page 2627 (CHAPTER 494, SB 325)ê

except to the extent that the provisions of chapter 82 of NRS are inconsistent with NRS 81.410 to 81.540, inclusive [.] , and section 87 of this act.

3. NRS 82.081 and 82.136 do not apply to a nonprofit cooperative corporation organized pursuant to NRS 81.410 to 81.540, inclusive [.] , and section 87 of this act.

Sec. 92. NRS 82.106 is hereby amended to read as follows:

82.106 1. The Secretary of State shall not accept for filing pursuant to this chapter any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing pursuant to this chapter if the name of the corporation contains the words “trust,” “engineer,” “engineered,” “engineering,” “professional engineer” or “licensed engineer.”

2. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing under this chapter when it appears from the articles or the certificate of amendment that the business to be carried on by the corporation is subject to supervision by the Commissioner of Insurance.

3. The Secretary of State shall not accept for filing pursuant to this chapter any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing pursuant to this chapter if the name of the corporation contains the word “accountant,” “accounting,” “accountancy,” “auditor” or “auditing.”

4. The Secretary of State shall not accept for filing any articles of incorporation or any certificate of amendment of articles of incorporation of any corporation formed or existing pursuant to the laws of this State which provides that the name of the corporation contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of incorporation or certificate of amendment that the purpose of the corporation is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the corporation has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

Sec. 93. NRS 86.171 is hereby amended to read as follows:

86.171 1. The name of a limited-liability company formed under the provisions of this chapter must contain the words “Limited-Liability Company,” “Limited Liability Company,” “Limited Company,” or “Limited” or the abbreviations “Ltd.,” “L.L.C.,” “L.C.,” “LLC” or “LC.” The word “Company” may be abbreviated as “Co.”

2. The name proposed for a limited-liability company must be distinguishable on the records of the Secretary of State from the names of all other artificial persons formed, organized, registered or qualified pursuant to the provisions of this title that are on file in the Office of the Secretary of State and all names that are reserved in the Office of the Secretary of State pursuant to the provisions of this title. If a proposed name is not so distinguishable, the Secretary of State shall return the articles of organization to the organizer, unless the written, acknowledged consent of the holder of the name on file or reserved name to use the same name or the requested similar name accompanies the articles of organization.

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ê2005 Statutes of Nevada, Page 2628 (CHAPTER 494, SB 325)ê

the name on file or reserved name to use the same name or the requested similar name accompanies the articles of organization.

3. For the purposes of this section and NRS 86.176, a proposed name is not distinguishable from a name on file or reserved name solely because one or the other contains distinctive lettering, a distinctive mark, a trademark or a trade name, or any combination thereof.

4. The name of a limited-liability company whose charter has been revoked, which has merged and is not the surviving entity or whose existence has otherwise terminated is available for use by any other artificial person.

5. The Secretary of State shall not accept for filing any articles of organization for any limited-liability company if the name of the limited-liability company contains the word “accountant,” “accounting,” “accountancy,” “auditor” or “auditing” unless the Nevada State Board of Accountancy certifies that the limited-liability company:

(a) Is registered pursuant to the provisions of chapter 628 of NRS; or

(b) Has filed with the Nevada State Board of Accountancy under penalty of perjury a written statement that the limited-liability company is not engaged in the practice of accounting and is not offering to practice accounting in this State.

6. The Secretary of State shall not accept for filing any articles of organization or certificate of amendment of articles of organization of any limited-liability company formed or existing pursuant to the laws of this State which provides that the name of the limited-liability company contains the word “bank” or “trust” unless:

(a) It appears from the articles of organization or the certificate of amendment that the limited-liability company proposes to carry on business as a banking or trust company, exclusively or in connection with its business as a bank, savings and loan association or thrift company; and

(b) The articles of organization or certificate of amendment is first approved by the Commissioner of Financial Institutions.

7. The Secretary of State shall not accept for filing any articles of organization or certificate of amendment of articles of organization of any limited-liability company formed or existing pursuant to the provisions of this chapter if it appears from the articles or the certificate of amendment that the business to be carried on by the limited-liability company is subject to supervision by the Commissioner of Insurance or by the Commissioner of Financial Institutions unless the articles or certificate of amendment is approved by the Commissioner who will supervise the business of the foreign limited-liability company.

8. Except as otherwise provided in subsection 7, the Secretary of State shall not accept for filing any articles of organization or certificate of amendment of articles of organization of any limited-liability company formed or existing pursuant to the laws of this State which provides that the name of the limited-liability company contains the words “engineer,” “engineered,” “engineering,” “professional engineer,” “registered engineer” or “licensed engineer” unless:

(a) The State Board of Professional Engineers and Land Surveyors certifies that the principals of the limited-liability company are licensed to practice engineering pursuant to the laws of this State; or

(b) The State Board of Professional Engineers and Land Surveyors certifies that the limited-liability company is exempt from the prohibitions of NRS 625.520.

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ê2005 Statutes of Nevada, Page 2629 (CHAPTER 494, SB 325)ê

9. The Secretary of State shall not accept for filing any articles of organization or certificate of amendment of articles of organization of any limited-liability company formed or existing pursuant to the laws of this State which provides that the name of the limited-liability company contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the articles of organization or certificate of amendment of articles of organization that the purpose of the limited-liability company is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the limited-liability company has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

10. The Secretary of State may adopt regulations that interpret the requirements of this section.

Sec. 94. NRS 86.272 is hereby amended to read as follows:

86.272 1. Each limited-liability company which is required to make a filing and pay the fee prescribed in NRS 86.263 and 86.264 and which refuses or neglects to do so within the time provided is in default.

2. Upon notification from the Administrator of the Real Estate Division of the Department of Business and Industry that a limited-liability company which is a unit-owners’ association as defined in NRS 116.011 has failed to register pursuant to NRS 116.31158 or failed to pay the fees pursuant to NRS 116.31155, the Secretary of State shall deem the limited-liability company to be in default. If, after the limited-liability company is deemed to be in default, the Administrator notifies the Secretary of State that the limited-liability company has registered pursuant to NRS 116.31158 and paid the fees pursuant to NRS 116.31155, the Secretary of State shall reinstate the limited-liability company if the limited-liability company complies with the requirements for reinstatement as provided in this section and NRS 86.276.

3. For default there must be added to the amount of the fee a penalty of $75. The fee and penalty must be collected as provided in this chapter.

Sec. 95. NRS 87.450 is hereby amended to read as follows:

87.450 1. The name proposed for a registered limited-liability partnership must contain the words “Limited-Liability Partnership” or “Registered Limited-Liability Partnership” or the abbreviation “L.L.P.” or “LLP” as the last words or letters of the name and must be distinguishable on the records of the Secretary of State from the names of all other artificial persons formed, organized, registered or qualified pursuant to the provisions of this title that are on file in the Office of the Secretary of State and all names that are reserved in the Office of the Secretary of State pursuant to the provisions of this title. If the name of the registered limited-liability partnership on a certificate of registration of limited-liability partnership submitted to the Secretary of State is not distinguishable from a name on file or reserved name, the Secretary of State shall return the certificate to the person who signed it unless the written, acknowledged consent of the holder of the name on file or reserved name to use the name accompanies the certificate.

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ê2005 Statutes of Nevada, Page 2630 (CHAPTER 494, SB 325)ê

2. For the purposes of this section, a proposed name is not distinguishable from a name on file or reserved name solely because one or the other contains distinctive lettering, a distinctive mark, a trademark or a trade name, or any combination thereof.

3. The Secretary of State shall not accept for filing any certificate of registration or certificate of amendment of a certificate of registration of any registered limited-liability partnership formed or existing pursuant to the laws of this State which provides that the name of the registered limited-liability partnership contains the word “accountant,” “accounting,” “accountancy,” “auditor” or “auditing” unless the Nevada State Board of Accountancy certifies that the registered limited-liability partnership:

(a) Is registered pursuant to the provisions of chapter 628 of NRS; or

(b) Has filed with the Nevada State Board of Accountancy under penalty of perjury a written statement that the registered limited-liability partnership is not engaged in the practice of accounting and is not offering to practice accounting in this State.

4. The Secretary of State shall not accept for filing any certificate of registration or certificate of amendment of a certificate of registration of any registered limited-liability partnership formed or existing pursuant to the laws of this State which provides that the name of the registered limited-liability partnership contains the word “bank” or “trust” unless:

(a) It appears from the certificate of registration or the certificate of amendment that the registered limited-liability partnership proposes to carry on business as a banking or trust company, exclusively or in connection with its business as a bank, savings and loan association or thrift company; and

(b) The certificate of registration or certificate of amendment is first approved by the Commissioner of Financial Institutions.

5. The Secretary of State shall not accept for filing any certificate of registration or certificate of amendment of a certificate of registration of any registered limited-liability partnership formed or existing pursuant to the provisions of this chapter if it appears from the certificate of registration or the certificate of amendment that the business to be carried on by the registered limited-liability partnership is subject to supervision by the Commissioner of Insurance or by the Commissioner of Financial Institutions, unless the certificate of registration or certificate of amendment is approved by the Commissioner who will supervise the business of the registered limited-liability partnership.

6. Except as otherwise provided in subsection 5, the Secretary of State shall not accept for filing any certificate of registration or certificate of amendment of a certificate of registration of any registered limited-liability partnership formed or existing pursuant to the laws of this State which provides that the name of the registered limited-liability partnership contains the words “engineer,” “engineered,” “engineering,” “professional engineer,” “registered engineer” or “licensed engineer” unless:

(a) The State Board of Professional Engineers and Land Surveyors certifies that the principals of the registered limited-liability partnership are licensed to practice engineering pursuant to the laws of this State; or

(b) The State Board of Professional Engineers and Land Surveyors certifies that the registered limited-liability partnership is exempt from the prohibitions of NRS 625.520.

7. The Secretary of State shall not accept for filing any certificate of registration or certificate of amendment of a certificate of registration of any registered limited-liability partnership formed or existing pursuant to the laws of this State which provides that the name of the registered limited-liability partnership contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the certificate of registration or certificate of amendment that the purpose of the registered limited-liability partnership is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the registered limited-liability partnership has:

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ê2005 Statutes of Nevada, Page 2631 (CHAPTER 494, SB 325)ê

registered limited-liability partnership formed or existing pursuant to the laws of this State which provides that the name of the registered limited-liability partnership contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the certificate of registration or certificate of amendment that the purpose of the registered limited-liability partnership is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the registered limited-liability partnership has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

8. The name of a registered limited-liability partnership whose right to transact business has been forfeited, which has merged and is not the surviving entity or whose existence has otherwise terminated is available for use by any other artificial person.

9. The Secretary of State may adopt regulations that interpret the requirements of this section.

Sec. 96. NRS 88.320 is hereby amended to read as follows:

88.320 1. Except as otherwise provided in NRS 88.6065, the name proposed for a limited partnership as set forth in its certificate of limited partnership:

(a) Must contain the words “Limited Partnership,” or the abbreviation “LP” or “L.P.”;

(b) May not contain the name of a limited partner unless:

(1) It is also the name of a general partner or the corporate name of a corporate general partner; or

(2) The business of the limited partnership had been carried on under that name before the admission of that limited partner; and

(c) Must be distinguishable on the records of the Secretary of State from the names of all other artificial persons formed, organized, registered or qualified pursuant to the provisions of this title that are on file in the Office of the Secretary of State and all names that are reserved in the Office of the Secretary of State pursuant to the provisions of this title. If the name on the certificate of limited partnership submitted to the Secretary of State is not distinguishable from any name on file or reserved name, the Secretary of State shall return the certificate to the filer, unless the written, acknowledged consent to the use of the same or the requested similar name of the holder of the name on file or reserved name accompanies the certificate of limited partnership.

2. For the purposes of this section, a proposed name is not distinguished from a name on file or reserved name solely because one or the other contains distinctive lettering, a distinctive mark, a trademark or a trade name, or any combination thereof.

3. The Secretary of State shall not accept for filing any certificate of limited partnership for any limited partnership formed or existing pursuant to the laws of this State which provides that the name of the limited partnership contains the word “accountant,” “accounting,” “accountancy,” “auditor” or “auditing” unless the Nevada State Board of Accountancy certifies that the limited partnership:

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(a) Is registered pursuant to the provisions of chapter 628 of NRS; or

(b) Has filed with the Nevada State Board of Accountancy under penalty of perjury a written statement that the limited partnership is not engaged in the practice of accounting and is not offering to practice accounting in this State.

4. The Secretary of State shall not accept for filing any certificate of limited partnership for any limited partnership formed or existing pursuant to the laws of this State which provides that the name of the limited partnership contains the word “bank” or “trust” unless:

(a) It appears from the certificate of limited partnership that the limited partnership proposes to carry on business as a banking or trust company, exclusively or in connection with its business as a bank, savings and loan association or thrift company; and

(b) The certificate of limited partnership is first approved by the Commissioner of Financial Institutions.

5. The Secretary of State shall not accept for filing any certificate of limited partnership for any limited partnership formed or existing pursuant to the provisions of this chapter if it appears from the certificate of limited partnership that the business to be carried on by the limited partnership is subject to supervision by the Commissioner of Insurance or by the Commissioner of Financial Institutions, unless the certificate of limited partnership is approved by the Commissioner who will supervise the business of the limited partnership.

6. Except as otherwise provided in subsection 5, the Secretary of State shall not accept for filing any certificate of limited partnership for any limited partnership formed or existing pursuant to the laws of this State which provides that the name of the limited partnership contains the words “engineer,” “engineered,” “engineering,” “professional engineer,” “registered engineer” or “licensed engineer” unless:

(a) The State Board of Professional Engineers and Land Surveyors certifies that the principals of the limited partnership are licensed to practice engineering pursuant to the laws of this State; or

(b) The State Board of Professional Engineers and Land Surveyors certifies that the limited partnership is exempt from the prohibitions of NRS 625.520.

7. The Secretary of State shall not accept for filing any certificate of limited partnership for any limited partnership formed or existing pursuant to the laws of this State which provides that the name of the limited partnership contains the words “common-interest community,” “community association,” “master association,” “unit-owners’ association” or “homeowners’ association” or if it appears in the certificate of limited partnership that the purpose of the limited partnership is to operate as a unit-owners’ association pursuant to chapter 116 of NRS unless the Administrator of the Real Estate Division of the Department of Business and Industry certifies that the limited partnership has:

(a) Registered with the Ombudsman for Owners in Common-Interest Communities pursuant to NRS 116.31158; and

(b) Paid to the Administrator of the Real Estate Division the fees required pursuant to NRS 116.31155.

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