Senate Bill No. 452–Committee on Government Affairs

 

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AN ACT relating to local governments; revising the provisions governing enterprise funds for building permit fees; and providing other matters properly relating thereto.

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1. NRS 354.59891 is hereby amended to read as

 follows:

    354.59891  1.  As used in this section:

    (a) “Barricade permit” means the official document issued by

 the building officer of a local government which authorizes the

 placement of barricade appurtenances or structures within a

 public right-of-way.

    (b)“Building permit” means the official document or certificate

 issued by the building officer of a local government which

 authorizes the construction of a structure.

    [(b)] (c) “Building permit basis” means the combination of the

 rate and the valuation method used to calculate the total building

 permit fee.

    [(c)] (d) “Building permit fee” means the total fees that must be

 paid before the issuance of a building permit, including , without

 limitation, all permit fees and inspection fees. The term does not

 include, without limitation, fees relating to water, sewer or other

 utilities, residential construction tax, tax for the improvement of

 transportation imposed pursuant to NRS 278.710, any fee imposed

 pursuant to NRS 244.386 or any amount expended to change the

 zoning of the property.

    [(d)] (e) “Current asset” means any cash maintained in an

 enterprise fund and any interest or other income earned on the

 money in the enterprise fund that, at the end of the current fiscal

 year, is anticipated by a local government to be consumed or

 converted into cash during the next ensuing fiscal year.

    [(e)] (f) “Current liability” means any debt incurred by a local

 government to provide the services associated with issuing building

 permits that, at the end of the current fiscal year, is determined by

 the local government to require payment within the next ensuing

 fiscal year.

    [(f)] (g) “Encroachment permit” means the official document

 issued by the building officer of a local government which

 authorizes construction activity within a public right-of-way.

    (h) “Operating cost” means the amount paid by a local

 government for supplies, services, salaries, wages and employee

benefits to provide the services associated with issuing building

permits.

    [(g)] (i) “Working capital” means the excess of current assets

 over current liabilities, as determined by the local government at

 the end of the current fiscal year.

    2.  Except as otherwise provided in subsections 3 and 4, a local

 government shall not increase its building permit basis by more

 than an amount equal to the building permit basis on June 30, 1989,

 multiplied by a percentage equal to the percentage increase in the

 Western Urban Nonseasonally Adjusted Consumer Price Index ,

 as published by the United States Department of Labor from

January 1, 1988, to the January 1 next preceding the fiscal year for

 which the calculation is made.

    3.  A local government may submit an application to increase

 its building permit basis by an amount greater than otherwise

 allowable pursuant to subsection 2 to the Nevada Tax Commission.

 The Nevada Tax Commission may allow the increase only if it

 finds that:

    (a) Emergency conditions exist which impair the ability of the

 local government to perform the basic functions for which it was

 created; or

    (b) The building permit basis of the local government is

 substantially below that of other local governments in the State and

 the cost of providing the services associated with the issuance of

 building permits in the previous fiscal year exceeded the total

 revenue received from building permit fees, excluding any amount

 of residential construction tax collected, for that fiscal year.

    4.  Upon application by a local government, the Nevada Tax

 Commission shall exempt the local government from the limitation

 on the increase of its building permit basis if:

    (a) The local government creates an enterprise fund exclusively

 for building permit fees [;] , fees imposed for the issuance of

 barricade permits and fees imposed for encroachment permits;

    (b) Any interest or other income earned on the money in the

 enterprise fund is credited to the fund;

    (c) Except as otherwise provided in subsection 5, the local

 government maintains a balance of unreserved working capital in

 the enterprise fund that does not exceed an amount equal to 9

 months’ operating costs for the program for the issuance of

 barricade permits, encroachment permits and building permits of

 the local government; and

    (d) The local government does not use any of the money in the

 enterprise fund for any purpose other than the actual direct and

 indirect costs of the program for the issuance of barricade permits,

 encroachment permits and building permits, including, without

 limitation, the cost of checking plans, issuing permits, inspecting

buildings and administering the program. The Committee on Local

Government Finance shall adopt regulations governing the

 permissible expenditures from an enterprise fund pursuant to this

 paragraph.

    5.  In addition to the balance of unreserved working capital

 authorized pursuant to subsection 4, the local government may

 maintain in an enterprise fund created pursuant to this section an

 amount of working capital for the following purposes:

    (a) An amount sufficient to pay the debt service for 1 year on

 any debt incurred by the local government to provide the services

 associated with issuing barricade permits, encroachment permits

 and building permits;

    (b) An amount that does not exceed the total amount of

 expenditures for the program for the issuance of barricade permits,

 encroachment permits and building permits of the local

 government set forth in the capital improvement plan of the local

 government prepared pursuant to NRS 354.5945 for the current

 fiscal year; and

    (c) An amount that does not exceed 4 percent of the annual

 operating costs of the program for the issuance of barricade

 permits, encroachment permits and building permits of the local

 government which must be used to pay for unanticipated capital

 replacement.

    6.  Any amount in an enterprise fund created pursuant to this

 section that is designated for special use, including, without

 limitation, prepaid fees and any other amount subject to a

 contractual agreement, must be identified as a restricted asset and

 must not be included as a current asset in the calculation of working

 capital.

    7.  If a balance in excess of the amount authorized pursuant to

 subsections 4 and 5 is maintained in an enterprise fund created

 pursuant to this section at the close of 2 consecutive fiscal years,

 the local government shall reduce the [building permit] fees for

 barricade permits, encroachment permits and building permits it

 charges by an amount that is sufficient to ensure that the balance in

 the enterprise fund at the close of the fiscal year next following

 those 2 consecutive fiscal years does not exceed the amount

 authorized pursuant to subsections 4 and 5.

    Sec. 2.  This act becomes effective on July 1, 2003.

 

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