MINUTES OF THE ASSEMBLY COMMITTEE ON GOVERNMENT AFFAIRS Sixty-eighth Session April 3, 1995 The Committee on Government Affairs was called to order at 9:35 a.m., on Monday, April 3, 1995, Chairman Lambert presiding in Room 330 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Douglas A. Bache, Chairman Mrs. Joan A. Lambert, Chairman Mrs. Deanna Braunlin, Vice Chairman Mr. Max Bennett Mrs. Marcia de Braga Mr. Pete Ernaut Mrs. Vivian L. Freeman Mr. William Z. (Bill) Harrington Ms. Saundra (Sandi) Krenzer Mr. Dennis Nolan Mrs. Gene Wines Segerblom Mrs. Patricia A. Tripple COMMITTEE MEMBERS EXCUSED: Mr. P.M. Roy Neighbors Mr. Wendell Williams STAFF MEMBERS PRESENT: Denice Miller, Senior Research Analyst Ted Zuend, Fiscal Analyst OTHERS PRESENT: Howard Barrett, Nevada Taxpayers Association; John Swendseid, Clark County; Pat Fries, Sierra Winnemucca PTA; Terri Thomas, City of Sparks Finance Director; Carole Vilardo, Nevada Taxpayers Association; Marvin Leavitt, City of Las Vegas. ASSEMBLY BILL 355 - Provides in skeleton form for limitation on authority to levy property taxes for support of certain districts with single or limited purposes. (BDR 20-953) Ted Zuend, Fiscal Analyst for the Legislative Counsel Bureau, was the staff person on the interim study on taxing districts. He said the bill was drafted in skeleton form as a recommendation from that study. The intent of the bill was to preclude future single purpose districts from participating in the tax rate because this has created problems in the past due to small districts having a tax rate which is the result of the way rates are added on top of each other to reach a cap. Often this has presented problems in governments getting under the cap. The reason the bill was in skeleton form was there were really no provisions for creating an assessment district for operation and maintenance. There has to be something there to levy a fee against such as water or sewage that can be measured. A user fee can then be assessed on those services. Chairman Lambert asked Mr. Zuend if he recalled any positive testimony for this bill in the committee. Mr. Zuend answered no, he could not remember. A number of these bills were recommendations gleaned from testimony from one side or from surveys of governmental entities or private parties who make recommendations. These bills were agendized at least twice, once in a hearing before the final work session and there was not a lot of commentary on some of these bills. The subcommittee's recommendation was to draft the bills for subsequent comment during the legislative session. Mrs. Lambert reiterated the bill was created to explore the idea of having small taxing districts to provide selected services for areas or should general government be the only government we have. The committee never got around to dealing with that policy issue. John Swendseid, representing Clark County, spoke in opposition to A.B. 355. He said the bill needed to be fleshed out, so to speak, to be effective for local governments. One of the problems with this legislation is special assessments. To levy an assessment, the property has to be benefitted by the amount of the assessment. This bill does not spell out the assessment procedure at all, it does not state whether hearings are required and does not specify what the special benefits would be. Some of the services discussed in the bill as being available for special assessments are really not appropriate for special assessment. Fire protection, 911 districts and cemeteries do not benefit property so it would be difficult to do special assessments for those districts. In addition, for some of these, a user fee cannot be easily charged. He was sure some things would surely need to be changed in order for the bill to be effective. Marvin Leavitt, representing the city of Las Vegas, saw several problems with the bill in its current form. He concurred with Mr. Swendseid. There was a great deal of work to do on the measure to come up with a workable bill. Carole Vilardo, Nevada Taxpayers Association, stated their opposition to the bill. ASSEMBLYMAN ERNAUT MOVED TO INDEFINITELY POSTPONE A.B. 355. ASSEMBLYMAN BENNETT SECONDED THE MOTION. THE MOTION PASSED UNANIMOUSLY. ASSEMBLY BILL 359 - Makes various changes regarding creation of certain taxing districts. (BDR 25-951) Howard Barrett, Nevada Taxpayers Association, stated this bill also came from an interim study by the Taxpayers Association on local government infrastructure, particularly special districts. Most of these districts were formed only after a negative vote or action; unless a certain number of people oppose it, it cannot be done. He felt that was bad policy and any unit of government should be formed only if a majority vote for it. This bill was an attempt to change those districts to make them from positive votes rather than negative ones. Mrs. Lambert pointed out a couple of things in the bill that were also recommendations; the ten year review and making sure the district is financially feasible. Mr. Barrett indicated those were not part of their original study, but he should have mentioned them anyway. Those items did come up during the committee meeting and they would support their inclusion. Too often, improvement districts are formed without enough background information to the taxpayer in the district regarding the financing, purpose and economic feasibility of the districts. The additional information given to the voter or petitioner before hand will enable him to make a better decision. Mr. Bennett asked if this was such a good piece of legislation, why would it not be effective until 2001. Mr. Barrett did not know. He did not draft the measure. Then he pointed out that was one particular provision. He mentioned it would be effective October 1 of that year. Mrs. Segerblom asked Mr. Barrett if there were special taxing districts in operation at the present time. Yes, he answered, but this bill did not add or repeal any districts. It simply changed the method by which they can be organized. Districts must now be organized according to a majority vote for the district rather than against it. Mrs. Segerblom wanted an example and Mrs. Lambert suggested he discuss how a common assessment district is formed. Mr. Barrett did not have the details on the formation of all types of districts but offered an overall view. He started with section 13, line 42, and said they are taking out the language ..."than 10% of the taxpayers..." . Line 47 would also remove the reference to 10%. Page nine, line 29, indicates the approval of majority, taking out the negative and replacing it with positive terminology. John Swendseid, representing Clark County, spoke in opposition of the bill. Marvin Leavitt, representing Las Vegas, agreed with the objective of the bill, but was primarily concerned with chapter 271, the portion that deals with special assessment districts and special improvement districts. The bill in its present form calls for an election by a majority of registered voters in the proposed district. The property owners in the district will be the ones who have to pay the assessment. The property owner may not live in the district for a variety of reasons. It seemed to Mr. Leavitt an election was not the appropriate method to determine whether or not it should be approved by people in the district. He said there was a question about the negative/positive vote business. From a practical standpoint a substantial portion of property is owned by people from out-of-state. These people tend not to respond to information cards in the mail. Most of the people who live in the districts do want the improvements, but because of these out-of-state property owners, it could be difficult to get a positive majority vote. The final decision remains with the property owners who ultimately have to pay for the improvements. Mr. Leavitt stated the second part on page six, lines 37-44 was really not designed for special assessment districts. They did not see any reason for it being in the bill. John Swendseid, representing Clark County, had similar views to Mr. Leavitt. He said the concept of the bill was not a problem but just certain provisions. Section one, requiring a hearing by the board of county commissioners on each special district. He thought it would be more appropriate for the special district itself to hold the hearing. Section 3B talks about petitions proposed by the majority of property owners. He wanted clarification as to how this was measured; by the number of people or by the amount of property. The county's main problems were sections 9,10, and 11. Section nine deals with districts for parks and their funding. Sections 10 and 11 are focused on special assessment districts. He echoed Mr. Leavitt's concerns regarding both areas. He pointed out section ten would require a vote on each ordinance in a special assessment district. There can be up to four ordinances in any district. In the past it was thought the property owners should have the negative vote instead of the residents. In a real election, however, the residents would have the vote, not the property owners. Section 12 would require a vote on the ordinance creating the special assessment district. The remainder of the bill was not a problem. Mrs. Lambert sat on the interim study and brought out there was no intention to have a formal election. It was more of a positive referendum rather that a negative where you had to mail your postcard in saying yes instead of no. Terri Thomas of the city of Sparks opposed the bill. She was concerned because the city of Sparks is trying to formulate a special assessment district to repair a particular area. She indicated a meeting with the property owners was well- attended which evidences the notice does go to the proper people and they are interested in the special assessment district. They wish there were an alternative funding source, but there is not. Due to the fact that many property owners live out-of-state, elections could possibly result in the situation which would prevent needed repairs and installation of necessary infrastructure. Barbara McKenzie, city of Reno, was also concerned about the ability to contact citizens to respond to surveys and return postcards. The number of people who would cooperate would not be high. She felt the election procedure would kill special assessments. Mrs. Lambert closed the hearing on A.B. 359. Mr. Ernaut reminded the committee of the subcommittee meeting on A.B. 189 immediately following the meeting. Mrs. Lambert said there were two BDR's before the committee. BDR R-1949 - Expresses vehement opposition to storage of radioactive waste in Nevada. This is an Assembly Joint Resolution. ASSEMBLYMAN BACHE MOVED TO INTRODUCE BDR R-1949. ASSEMBLYMAN DE BRAGA SECONDED THE MOTION. Mr. Ernaut questioned if this had anything to do with the events of the past few days. Mr. Bache indicated the democratic floor leader gave it to him as the government affairs committee was the appropriate place to introduce the bill. Mr. Neighbors requested a repetition of the summary. Mrs. Lambert offered to get him a copy. Mr. Neighbors assumed if the resolution was introduced or passed they would not be recalled. Mr. Bennett asked if it specified high or low level nuclear waste. Mrs. Lambert answered high level. She was not sure it was in the right committee. THE MOTION PASSED. ASSEMBLYMAN BENNETT VOTED NO. BDR S-748 - Makes various changes to the charter of the City of Henderson. ASSEMBLYMAN NOLAN MOVED TO INTRODUCE BDR S-748. ASSEMBLYMAN SEGERBLOM SECONDED THE MOTION. THE MOTION PASSED UNANIMOUSLY. Mrs. Lambert had some amendments back from bill draft and passed them out for the committee. The meeting was adjourned at 10:10 a.m. RESPECTFULLY SUBMITTED: ____________________________ Denise Sins, Committee Secretary APPROVED BY: Assemblyman Douglas A. Bache, Chairman Assemblyman Joan A. Lambert, Chairman Assembly Committee on Government Affairs April 3, 1995 Page