SB495_EN

Senate Bill No. 495–Senators Townsend,
Washington and Mathews

CHAPTER..........

AN ACT relating to local improvements; authorizing under certain circumstances the acquisition of art and tourism and entertainment projects pursuant to the Consolidated Local Improvements Law; authorizing under certain circumstances the pledge of certain sales and use tax proceeds and state funding for the acquisition of projects pursuant to the Consolidated Local Improvements Law; and providing other matters properly relating thereto.

Whereas, The State Legislature recognizes the importance of economic development and tourism to the State of Nevada and the need to compete effectively with other states in the promotion of economic development and tourism; and

Whereas, It is the intention of the State Legislature for the provisions of this act to be carried out for the promotion of economic development and tourism in the State of Nevada and for no other purpose; now, therefore,

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

Section 1. Chapter 271 of NRS is hereby amended by adding

thereto the provisions set forth as sections 2 to 7, inclusive, of this

act.

Sec. 2. “Art project” means any works of art which are:

1. Selected through a public process; and

2. Displayed within the boundaries of an improvement district

at a location which is:

(a) Accessible to the public; and

(b) On property:

(1) Owned by a governmental entity; or

(2) Over which a governmental entity has a permanent

easement for public access.

Sec. 3. “Tourism and entertainment project” means any

publicly owned building or complex of buildings to accommodate

or house public and private activities as a part of a multi-faceted

center for tourism, including, without limitation, library facilities,

museum facilities, theater facilities, aquarium facilities, art

galleries, picture galleries, auditorium facilities, exposition

facilities, athletic facilities, racing facilities and any other

structures, fixtures, appurtenances and property and other

incidentals which are necessary, useful or desirable for such a

project, or any combination thereof.

Sec. 4. 1. Except as otherwise provided in subsection 2, the

governing body of a municipality in a county whose population is

less than 400,000 may include in an assessment ordinance for a

project the pledge of a single percentage specified in the

ordinance, which must not exceed 75 percent, of:

(a) An amount equal to the proceeds of the taxes imposed

pursuant to NRS 372.105 and 372.185 with regard to tangible

personal property sold at retail, or stored, used or otherwise

consumed, in the improvement district during a fiscal year, after

the deduction of a sum equal to 0.75 percent of the amount of

those proceeds; and

(b) The amount of the proceeds of the taxes imposed pursuant

to NRS 374.110, 374.190 and 377.030 with regard to tangible

personal property sold at retail, or stored, used or otherwise

consumed, in the improvement district during a fiscal year, after

the deduction of 0.75 percent of the amount of those proceeds.

2. The governing body of a municipality shall not include a

pledge authorized by subsection 1 in an assessment ordinance for

a project unless:

(a) The governing body determines that no retailers have

maintained a fixed place of business in the improvement district at

any time from the first day of the fiscal year in which the

assessment ordinance is adopted until the date of the adoption of

the ordinance;

(b) Except as otherwise provided in subsection 3, the board of

county commissioners of each county in which the improvement

district is located determines, at a public hearing conducted at

least 15 days after providing notice of the hearing by publication,

that:

(1) As a result of the project:

(I) Retailers will locate their businesses as such in the

improvement district; and

(II) There will be a substantial increase in the proceeds

from sales and use taxes remitted by retailers with regard to

tangible personal property sold at retail, or stored, used or

otherwise consumed, in the improvement district; and

(2) A preponderance of that increase in the proceeds from

sales and use taxes will be attributable to transactions with tourists

who are not residents of this state;

hearing conducted at least 15 days after providing notice of the

hearing by publication, that a preponderance of the increase in

the proceeds from sales and use taxes identified pursuant to

paragraph (b) will be attributable to transactions with tourists who

are not residents of this state; and

(d) The Governor determines that the project and the pledge of

money authorized by subsection 1 will contribute significantly to

economic development and tourism in this state. Before making

that determination, the Governor:

(1) Must consider the fiscal effects of the pledge of money

on educational funding, including any fiscal effects described in

comments provided pursuant to section 6 of this act by the school

district in which the improvement district is located, and for that

purpose may require the Department of Education or the

Department of Taxation, or both, to provide him with an

appropriate fiscal report; and

(2) If the Governor determines that the pledge of money

will have a substantial adverse fiscal effect on educational

funding, may require a commitment from the municipality for the

provision of specified payments to the school district in which the

improvement district is located during the term of the pledge of

money. The payments may be provided pursuant to agreements

authorized by section 6 of this act or from sources other than the

owners of property within the improvement district. Such a

commitment by a municipality is not subject to the limitations of

subsection 1 of NRS 354.626 and, notwithstanding any other law

to the contrary, is binding on the municipality for the term of the

pledge of money authorized by subsection 1.

3. Any determination or approval made pursuant to

subsection 2 is conclusive in the absence of fraud or gross abuse

of discretion. If an improvement district is created by a

municipality that is not a county and the board of county

commissioners refuses to make the determinations required by

paragraph (b) of subsection 2, the governing body of the

municipality may request the Commission on Tourism to make

those determinations. The Commission on Tourism shall make

those determinations if a majority of the members of the

Commission on Tourism agree that the refusal was unreasonable.

If those determinations are made by the Commission on Tourism

pursuant to this subsection, those determinations shall be deemed

to be as conclusive as determinations made by the board of county

commissioners pursuant to paragraph (b) of subsection 2, and to

satisfy the requirements of that paragraph.

4. As used in this section, “retailer” has the meaning ascribed

to it in NRS 374.060.

Sec. 5. After the adoption of an assessment ordinance in

accordance with section 4 of this act, the governing body of the

municipality and the Department of Taxation shall enter into an

agreement specifying the dates and procedure for distribution to

the municipality of the amounts pledged pursuant to subsection 1

of section 4 of this act. The distributions must:

1. Be made not less frequently than once each calendar

quarter; and

2. Cease on the date that all assessments imposed pursuant to

the assessment ordinance have been paid in full, including any

applicable payments of principal, interest and penalties.

Sec. 6. 1. After the adoption of an assessment ordinance in

accordance with section 4 of this act, the governing body of a

municipality may, except as otherwise provided in subsection 2,

enter into an agreement with one or more of the owners of any

interest in property within the improvement district, pursuant to

which that owner would agree to make payments to the

municipality or to another local government that provides services

in the improvement district, or to both, to defray, in whole or in

part, the cost of local governmental services during the term of the

pledge authorized pursuant to subsection 1 of section 4 of this act.

Such an agreement must specify the amount to be paid by the

owner of the property interest, which may be stated as a particular

amount per year or as an amount based upon any formula upon

which the municipality and owner agree.

2. The governing body of a municipality shall not enter into

an agreement pursuant to subsection 1 unless the governing body

determines that the project and the assessment of property within

the improvement district will not have a positive fiscal effect on the

provision of local governmental services, after considering:

(a) The amount of the proceeds of all taxes and other

governmental revenue projected to be received as a result of the

properties and businesses expected to be located in the

improvement district;

(b) The use of the amounts pledged pursuant to subsection 1 of

section 4 of this act; and

governmental services, including, without limitation, services for

police protection and fire protection, as a result of the project and

the development of land within the improvement district.

3. Before making any determination pursuant to

subsection 2, the governing body of a municipality shall provide to

the board of trustees of the school district in which the

improvement district is located, at least 45 days before making the

determination:

(a) Written notice of the time and place of the meeting at

which the governing body will consider making the determination;

and

(b) Each analysis prepared by or for or presented to the

governing body regarding the fiscal effect of the project and the

pledge authorized pursuant to section 4 of this act on the provision

of local governmental services, including education.

After the receipt of that notice and before the date of that meeting

of the governing body of the municipality, the board of trustees

shall conduct a hearing regarding the fiscal effect, if any, of the

project and the pledge authorized pursuant to section 4 of this act

on the school district, and submit to the governing body any

comments regarding that fiscal effect. The governing body shall

consider those comments when making any determination

pursuant to subsection 2 and may consider those comments when

determining the terms of any agreement pursuant to subsection 1.

4. Any determination made pursuant to subsection 2 is

conclusive in the absence of fraud or gross abuse of discretion.

Sec. 7. If the governing body of a municipality adopts an

assessment ordinance in accordance with section 4 of this act:

1. None of the bonds, if any, issued for the improvement

district may be secured by a pledge of the taxing power or general

fund of the municipality; and

2. NRS 271.495 and 271.500 do not apply to any bonds issued

for the improvement district.

Sec. 8. NRS 271.030 is hereby amended to read as follows:

271.030 As used in this chapter, unless the context otherwise

requires, the words and terms defined in NRS 271.035 to 271.250,

inclusive, and sections 2 and 3 of this act have the meanings

ascribed to them in those sections.

Sec. 9. NRS 271.265 is hereby amended to read as follows:

271.265 1. The governing body of a county, city or town,

upon behalf of the municipality and in its name, without any

election, may from time to time acquire, improve, equip, operate

and maintain, within or without the municipality, or both within and

without the municipality:

(a) A commercial area vitalization project;

(b) A curb and gutter project;

(d) An off-street parking project;

(e) An overpass project;

(f) A park project;

(g) A sanitary sewer project;

(h) A security wall;

(i) A sidewalk project;

(j) A storm sewer project;

(k) A street project;

(l) A street beautification project;

(m) A transportation project;

(n) An underpass project;

(o) A water project; and

(p) Any combination of such projects.

2. In addition to the power specified in subsection 1, the

governing body of a city having a commission form of government

as defined in NRS 267.010, upon behalf of the municipality and in

its name, without any election, may from time to time acquire,

improve, equip, operate and maintain, within or without the

municipality, or both within and without the municipality:

(a) An electrical project;

(b) A telephone project;

project;

(d) A combination of an electrical project or a telephone project

with any of the projects, or any combination thereof, specified in

subsection 1; and

(e) A combination of an electrical project and a telephone

project with any of the projects, or any combination thereof,

specified in subsection 1.

3. In addition to the power specified in subsections 1 and 2, the

governing body of a municipality, on behalf of the municipality and

in its name, without an election, may finance an underground

conversion project with the approval of each service provider that

owns the overhead service facilities to be converted.

4. In addition to the power specified in subsections 1, 2 and 3,

if the governing body of a municipality in a county whose

population is less than 400,000 complies with the provisions of

section 4 of this act, the governing body of the municipality, on

behalf of the municipality and in its name, without any election,

may from time to time acquire, improve, equip, operate and

maintain, within or without the municipality, or both within and

without the municipality:

(a) An art project; and

(b) A tourism and entertainment project.

Sec. 10. NRS 271.431 is hereby amended to read as follows:

271.431 As used in NRS 271.431 to 271.434, inclusive,

“revenue” means any money pledged wholly or in part for crediting

to or payment of assessments, subject to any existing pledges or

other contractual limitations and may include:

1. Moneys derived from one, all or any combination of revenue

resources appertaining to any facilities of the municipality, financed

in whole or in part with the proceeds of assessments levied pursuant

to the assessment ordinance, including , but not limited to , use and

service charges, rents, fees and any other income derived from the

operation or ownership of, from the use or services of, or from the

availability of or services appertaining to, the lease of, any sale or

other disposal of, any contract or other arrangement, or otherwise

derived in connection with such facilities or all or any part of any

property appertaining to the facilities.

2. Any loans, grants or contributions to the municipality from

the Federal Government, the State or any public body for the

payment of all or any portion of the cost of the project for which the

assessments were levied.

3. The proceeds of any excise taxes levied and collected by the

municipality or otherwise received by it and authorized by law to be

pledged for the payment of the project for which the assessments

were levied or for the payment of the assessments levied to finance

the cost of the project but excluding the proceeds of any general (ad

valorem) taxes.

4. Any money pledged pursuant to an assessment ordinance

adopted in accordance with section 4 of this act.

Sec. 11. NRS 271.4315 is hereby amended to read as follows:

271.4315 1. The governing body may apply any revenues to

the payment of assessments and in so doing may pledge the revenue

to such payment. The revenues [shall] must be credited in the

proportion which each individual assessment or installment of

principal bears to the total of all individual assessments in the

assessment to which the revenues are to be credited. The application

of revenues [shall] must be made pursuant to the provisions set forth

in the assessment ordinance.

2. If an individual assessment, or any installment of principal

and interest has been paid in cash, the credit [shall] must be returned

in cash to the person or persons paying the same upon their

furnishing satisfactory evidence of payment. Where all or any part

of an individual assessment remains unpaid and is payable in

installments of principal, the credit [shall] must be applied to the

installment, and if after the payment of the installment there remains

an unused portion of the credit, the unused portion [shall] must be

applied to the payment of interests, and if after the payment of such

principal and interest there remains an unused portion of the credit,

the unused portion [shall] must be :

(a) Except as otherwise provided in paragraph (b), applied to

the next ensuing installment or installments of principal and interest

; or

(b) If the credit is derived from money pledged pursuant to an

assessment ordinance adopted in accordance with section 4 of this

act, remitted to the State Controller for distribution in the manner

set forth in subsection 2 of section 12 of this act, until the credit is

applied in its entirety.

Sec. 12. Chapter 360 of NRS is hereby amended by adding

thereto a new section to read as follows:

1. The State Controller, acting upon the collection data

furnished by the Department, shall remit to the governing body of

a municipality that adopts an assessment ordinance in accordance

with section 4 of this act, in the manner provided pursuant to an

agreement made pursuant to section 5 of this act:

(a) From the State General Fund the amount of money

pledged pursuant to the ordinance in accordance with paragraph

(a) of subsection 1 of section 4 of this act, which amount is hereby

appropriated for that purpose; and

(b) From the Sales and Use Tax Account in the State General

Fund the amount of the proceeds pledged pursuant to the

ordinance in accordance with paragraph (b) of subsection 1 of

section 4 of this act.

2. The governing body of a municipality that adopts an

assessment ordinance in accordance with section 4 of this act shall

promptly remit to the State Controller any amount received

pursuant to this section in excess of the amount required to carry

out the provisions of NRS 271.4315 with regard to the project for

which the assessment ordinance was adopted. The State Controller

shall deposit any money received from a governing body of a

municipality pursuant to this subsection in the appropriate

account in the State General Fund for distribution and use as if

the money had not been pledged pursuant to an assessment

ordinance adopted in accordance with section 4 of this act, in the

following order of priority:

(a) First, to the credit of the county school district fund for the

county in which the improvement district is located to the extent

that the money would have been transferred to that fund, if not for

the pledge of the money pursuant to the assessment ordinance,

pursuant to paragraph (e) of subsection 3 of NRS 374.785 for the

fiscal year in which the State Controller receives the money;

(b) Second, to the State General Fund to the extent that the

money would not have been appropriated, if not for the pledge of

the money pursuant to the assessment ordinance, pursuant to

paragraph (a) of subsection 1 for the fiscal year in which the State

Controller receives the money; and

which the money would have been distributed, if not for the pledge

of the money pursuant to the assessment ordinance, for the fiscal

year in which the State Controller receives the money.

3. The Nevada Tax Commission may adopt such regulations

as it deems appropriate to ensure the proper collection and

distribution of any money pledged pursuant to an assessment

ordinance adopted in accordance with section 4 of this act.

Sec. 13. NRS 374.785 is hereby amended to read as follows:

374.785 1. All fees, taxes, interest and penalties imposed and

all amounts of tax required to be paid to counties under this chapter

must be paid to the Department in the form of remittances payable

to the Department.

2. The Department shall deposit the payments in the State

Treasury to the credit of the Sales and Use Tax Account in the State

General Fund.

3. The State Controller, acting upon the collection data

furnished by the Department, shall, each month, from the Sales and

Use Tax Account in the State General Fund:

(a) Transfer .75 percent of all fees, taxes, interest and penalties

collected in each county during the preceding month to the

appropriate account in the State General Fund as compensation to

the State for the costs of collecting the tax.

(b) Transfer .75 percent of all fees, taxes, interest and penalties

collected during the preceding month from out-of-state businesses

not maintaining a fixed place of business within this state to the

appropriate account in the State General Fund as compensation to

the State for the costs of collecting the tax.

fees, taxes, interest and penalties collected in the county pursuant to

this chapter during the preceding month , less the amount transferred

pursuant to paragraph (a).

(d) Transfer the total amount of taxes collected pursuant to this

chapter during the preceding month from out-of-state businesses not

maintaining a fixed place of business within this state, less the

amount transferred pursuant to paragraph (b)[,] and excluding any

amounts required to be remitted pursuant to section 12 of this act,

to the State Distributive School Account in the State General Fund.

(e) Except as otherwise provided in NRS 387.528[,] or as

required to carry out section 12 of this act, transfer the amount

owed to each county to the Intergovernmental Fund and remit the

money to the credit of the county school district fund.

4. For the purpose of the distribution required by this section,

the occasional sale of a vehicle shall be deemed to take place in the

county to which the governmental services tax payable by the buyer

upon that vehicle is distributed.

Sec. 14. NRS 377.050 is hereby amended to read as follows:

377.050 1. All fees, taxes, interest and penalties imposed and

all amounts of tax required to be paid to counties under this chapter

must be paid to the Department in the form of remittances made

payable to the Department.

2. The Department shall deposit the payments with the State

Treasurer for credit to the Sales and Use Tax Account in the State

General Fund.

3. The State Controller, acting upon the collection data

furnished by the Department, shall , before making the

distributions required by NRS 377.055 and 377.057 and section 12

of this act, monthly transfer from the Sales and Use Tax Account

.75 percent of all fees, taxes, interests and penalties collected

pursuant to this chapter during the preceding month to the

appropriate account in the State General Fund[, before making the

distributions required by NRS 377.055 and 377.057,] as

compensation to the State for the cost of collecting the tax.

Sec. 15. NRS 377.055 is hereby amended to read as follows:

377.055 1. The Department shall monthly determine for each

county an amount of money equal to the sum of:

(a) Any fees and any taxes, interest and penalties which derive

from the basic city-county relief tax collected in that county

pursuant to this chapter during the preceding month, less the

corresponding amount transferred to the State General Fund

pursuant to subsection 3 of NRS 377.050; and

(b) That proportion of the total amount of taxes which derive

from that portion of the tax levied at the rate of one-half of 1 percent

collected pursuant to this chapter during the preceding month from

out-of-state businesses not maintaining a fixed place of business

within this state, less the corresponding amount transferred to the

State General Fund pursuant to subsection 3 of NRS 377.050, which

the population of that county bears to the total population of all

counties which have in effect a city-county relief tax

ordinance,

and , except as otherwise required to carry out section 12 of this

act, deposit the money in the Local Government Tax Distribution

Account created by NRS 360.660 for credit to the respective

subaccounts of each county.

2. For the purpose of the distribution required by this section,

the occasional sale of a vehicle shall be deemed to take place in the

county to which the governmental services tax payable by the buyer

upon that vehicle is distributed.

Sec. 16. NRS 377.057 is hereby amended to read as follows:

377.057 1. The State Controller, acting upon the relevant

information furnished by the Department, shall distribute monthly

from the fees, taxes, interest and penalties which derive from the

supplemental city-county relief tax collected in all counties and

from out-of-state businesses during the preceding month, excluding

any amounts required to be remitted pursuant to section 12 of this

act and except as otherwise provided in subsection 2, to:

(a) Douglas, Esmeralda, Eureka, Lander, Lincoln, Lyon,

Mineral, Nye, Pershing, Storey and White Pine counties, an amount

equal to one-twelfth of the amount distributed in the immediately

preceding fiscal year multiplied by one plus:

(1) The percentage change in the total receipts from the

supplemental city-county relief tax for all counties and from out-of-

state businesses, from the fiscal year 2 years preceding the

immediately preceding fiscal year to the fiscal year preceding the

immediately preceding fiscal year; or

(2) Except as otherwise provided in this paragraph, the

percentage change in the population of the county, as certified by

the Governor pursuant to NRS 360.285, added to the percentage

change in the Consumer Price Index for the year ending on

December 31 next preceding the year of distribution,

whichever is less, except that the amount distributed to the county

must not be less than the amount specified in subsection 5. If the

Bureau of the Census of the United States Department of Commerce

issues population totals that conflict with the totals certified by the

Governor pursuant to NRS 360.285, the percentage change

calculated pursuant to subparagraph (2) for the ensuing fiscal year

must be an estimate of the change in population for the calendar

year, based upon the population totals issued by the Bureau of the

Census.

(b) All other counties, the amount remaining after making the

distributions required by paragraph (a) to each of these counties in

the proportion that the amount of supplemental city-county relief tax

collected in the county for the month bears to the total amount of

supplemental city-county relief tax collected for that month in the

counties whose distribution will be determined pursuant to this

paragraph.

2. If the amount of supplemental city-county relief tax

collected in a county listed in paragraph (a) of subsection 1 for the

12 most recent months for which information concerning the actual

amount collected is available on February 15 of any year exceeds by

more than 10 percent the amount distributed pursuant to paragraph

(a) to that county for the same period, the State Controller shall

distribute that county’s portion of the proceeds from the

supplemental city-county relief tax pursuant to paragraph (b) of

subsection 1 in all subsequent fiscal years, unless a waiver is

granted pursuant to subsection 3.

3. A county which, pursuant to subsection 2, is required to

have its portion of the proceeds from the supplemental city-county

relief tax distributed pursuant to paragraph (b) of subsection 1 may

file a request with the Nevada Tax Commission for a waiver of the

requirements of subsection 2. The request must be filed on or before

February 20 next preceding the fiscal year for which the county will

first receive its portion of the proceeds from the supplemental city-

county relief tax pursuant to paragraph (b) of subsection 1 and must

be accompanied by evidence which supports the granting of the

waiver. The Commission shall grant or deny a request for a waiver

on or before March 10 next following the timely filing of the

request. If the Commission determines that the increase in

the amount of supplemental city-county relief tax collected in the

county was primarily caused by:

(a) Nonrecurring taxable sales, it shall grant the request.

(b) Normal or sustainable growth in taxable sales, it shall deny

the request.

A county which is granted a waiver pursuant to this subsection is

not required to obtain a waiver in any subsequent fiscal year to

continue to receive its portion of the proceeds from the

supplemental city-county relief tax pursuant to paragraph (a) of

subsection 1 unless the amount of supplemental city-county relief

tax collected in the county in a fiscal year again exceeds the

threshold established in subsection 2.

4. The amount apportioned to each county must be deposited in

the Local Government Tax Distribution Account created by NRS

360.660 for credit to the respective accounts of each county.

5. The minimum amount which may be distributed to the

following counties in a month pursuant to paragraph (a) of

subsection 1 is as follows:

Douglas......................................... $580,993

Esmeralda.......................................... 53,093

Lander.............................................. 155,106

Lincoln............................................... 72,973

Lyon................................................. 356,858

Mineral............................................. 118,299

Nye................................................... 296,609

Pershing............................................. 96,731

Storey................................................. 69,914

White Pine....................................... 158,863

6. As used in this section, unless the context otherwise

requires:

(a) “Enterprise district” has the meaning ascribed to it in

NRS 360.620.

(b) “Local government” has the meaning ascribed to it in

NRS 360.640.

in NRS 360.650.

Sec. 17. NRS 387.1235 is hereby amended to read as follows:

387.1235 1. Except as otherwise provided in subsection 2,

local funds available are the sum of:

(a) The amount computed by multiplying .0025 times the

assessed valuation of the school district as certified by the

Department of Taxation for the concurrent school year; and

(b) The proceeds of the local school support tax imposed by

chapter 374 of NRS[.] , excluding any amounts required to be

remitted pursuant to section 12 of this act. The Department of

Taxation shall furnish an estimate of these proceeds to the

Superintendent of Public Instruction on or before July 15 for the

fiscal year then begun, and the Superintendent shall adjust the final

apportionment of the current school year to reflect any difference

between the estimate and actual receipts.

2. The amount computed under subsection 1 that is attributable

to any assessed valuation attributable to the net proceeds of minerals

must be held in reserve and may not be considered as local funds

available until the succeeding fiscal year.

Sec. 18. Notwithstanding any other provision of this act and

the terms of any ordinance adopted in accordance with section 4 of

this act, the provisions of this act do not require the distribution of

any money remitted to the State before July 1, 2005, unless the

Department of Taxation determines that it is reasonably feasible to

make such a distribution.

Sec. 19. The governing body of a municipality which before

January 1, 2007, pledges any money pursuant to an assessment

ordinance adopted in accordance with section 4 of this act shall, on

or before February 1, 2007, submit to the Director of the Legislative

Counsel Bureau for transmittal to the next regular session of the

Legislature a written report regarding:

1. The project for which the money was pledged; and

2. The fiscal effect of the project and the pledge of money on

the provision of local governmental services, including education,

within the county in which the municipality is located.

Sec. 20. This act becomes effective on July 1, 2003.

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