MINUTES OF THE
SENATE Committee on Natural Resources
Seventy-second Session
April 30, 2003
The Senate Committee on Natural Resources was called to order by Chairman Dean A. Rhoads, at 1:36 p.m., on Wednesday, April 30, 2003, in Room 2144 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Senator Dean A. Rhoads, Chairman
Senator Mike McGinness, Vice Chairman
Senator Raymond C. Shaffer
Senator Mark Amodei
Senator Bob Coffin
Senator Maggie Carlton
COMMITTEE MEMBERS ABSENT:
Senator Michael Schneider (Excused)
GUEST LEGISLATORS PRESENT:
Assemblyman Harry Mortenson, Assembly District No. 42
Senator Alice Costandina (Dina) Titus, Clark County Senatorial District No. 7
Assemblyman Lynn Hettrick, Assembly District No. 39
STAFF MEMBERS PRESENT:
Fred Welden, Committee Policy Analyst
Lee-Ann Keever, Committee Secretary
OTHERS PRESENT:
Robert Crowell, Lobbyist, Nevada Well Owners Association
Raymond E. Preston, Lobbyist, President, Nevada Well Owners Association
Hugh Ricci, P.E., State Engineer, Division of Water Resources, State Department of Conservation and Natural Resources
Andy Belanger, Lobbyist, Southern Nevada Water Authority
Don Henderson, Acting Director, State Department of Agriculture
Christopher J. Mason, Ph.D., Section Chief, Registration and Laboratory Services, Division of Plant Industry, State Department of Agriculture
Pamela B. Wilcox, Acting Administrator, Division of Conservation Districts, and Administrator and State Land Registrar, Division of State Lands, State Department of Conservation and Natural Resources
Kevin Piper, Dayton Valley Conservation District
James Settlemeyer, Owner, Settlemeyer Ranches; Chairman, Carson Valley Conservation District, and Chairman, State Conservation Commission, Department of Conservation; and Natural Resources
Dan Musgrove, Lobbyist, Clark County
Dan Kaffer, Western Nevada Resource Conservation and Development Council
Steve K. Walker, Lobbyist, Douglas County
Allen Biaggi, Administrator, Division of Environmental Protection, State Department of Conservation and Natural Resources
Terry Graves, Lobbyist, Landwell Company
Dan H. Stewart, President and CEO, Landwell Company
Steve Rice, General Counsel, Landwell Company
Tony F. Sanchez, Lobbyist, Landwell Company
Barry C. Duncan, Lobbyist, Southern Nevada Homebuilders Association
Stephanie D. Garcia-Vause, Lobbyist, City of Henderson
Chairman Rhoads opened the hearing on Assembly Bill (A.B.) 213.
ASSEMBLY BILL 213 (1st Reprint): Makes various changes concerning domestic wells and temporary permits for appropriation of ground water. (BDR 47‑654)
Assemblyman Harry Mortenson, Assembly District No. 42, said A.B. 213 involved many parties who worked to pass the measure through the Assembly. Assemblyman Mortenson introduced Robert Crowell, Lobbyist, Nevada Well Owners Association, and Raymond E. Preston, Lobbyist, President, Nevada Well Owners Association.
Mr. Crowell said A.B. 213 received unanimous approval from the Assembly and was a consent bill between the Nevada Well Owners Association (NWOA), the Southern Nevada Water Authority (SNWA), and the State engineer’s office.
Mr. Crowell explained Nevada Revised Statutes (NRS) 534.120 addressed the State engineer’s authority to revoke temporary well permits issued for residential use. The law currently said the State engineer could revoke the temporary well permits if the user is located within 180 feet of a municipal water system; if a drill rig is required to facilitate repairs to a well; or when financial assistance equaling 50 percent to 85 percent of the hookup fee to a municipal water system is offered to a well owner by a government entity.
The provisions of NRS 534.120 expired in 2005. The bill removed the sunset provision of NRS 534.120 and transferred responsibility for the financial assistance provided by the statute to the SNWA’s enabling legislation. Mr. Crowell said he believed the bill worked well and had been used to hookup 120 well owners voluntarily and 5 well owners involuntarily to the southern Nevada municipal water system.
Section 1, subsection 7 clarified the State engineer’s authority to revoke a
well permit if the permit holder resided on a parcel of land which was
connected to a municipal water system.
Section 5 authorized the State engineer to conduct a 2-year study to determine whether there was sufficient authority to regulate water usage by southern Nevada well owners. Should the State engineer conclude his power to regulate the efficient use of well water was insufficient, the results of the study would be reported to the 73rd Legislative Session. The State engineer agreed to section 5.
Mr. Crowell encouraged the committee members to pass A.B. 213.
Raymond E. Preston, Lobbyist, President, Southern Nevada Well Owners Association, said all parties involved with the passage of A.B. 213 worked hard on the measure and agreed on it. He said the bill was a good bill.
Chairman Rhoads asked how much money was available to fund the well hookup program. Andy Belanger, Lobbyist, Southern Nevada Water Authority, stated the SNWA collected and expended approximately $2 million a year. The balance, if any, was used to connect people to the SNWA’s system. More people were being voluntarily connected than there were funds available. Reserve funds from past years were being use to pay connection fees.
Senator Carlton said she remembered the hookup issue as being contentious and wanted clarification on a few points. She asked how the fee was collected. Mr. Belanger replied in August of every year, bills were mailed out to the well owners. The fee ranged from $30 for a domestic home to $30 per acre-foot per year for all well types.
Senator Carlton referred to section 2, subsection 6, and asked whether the fee structure would have to be modified to fund the activities mentioned in that provision. Mr. Belanger said section 2, subsection 5 had been moved to the SNWA’s enabling legislation from NRS 534.120. No additional costs would be incurred. The cost of well plugging was currently included in the connection costs. The SNWA paid all costs associated with plugging a well and 85 percent of the connection costs.
Chairman Rhoads asked Senator Carlton whether she was reading from the first reprint of the bill. Senator Carlton replied, “yes,” adding she had not previously realized section 2, subsection 6 was part of the bill.
Senator Carlton asked why the sunset provision of the bill had been changed. Mr. Crowell said the sunset provision would be eliminated through operational law. He added if the sunset provision were not removed through statute, it and the associated financing would expire in June 2005.
Hugh Ricci, P.E., State Engineer, Division of Water Resources, State Department of Conservation and Natural Resources, said he agreed with Mr. Crowell’s synopsis. He stated section 5 of the bill applied to all well permits issued in southern Nevada.
Chairman Rhoads said the well hookup program was working well especially when compared to the program’s past operation. Mr. Ricci agreed with the chairman.
Chairman Rhoads closed the hearing on A.B. 213 and opened the hearing on A.B. 91.
ASSEMBLY BILL 91 (1st Reprint): Revises provisions governing regulation of pesticides. (BDR 51-568)
Don Henderson, Acting Director, State Department of Agriculture, said he needed to leave due to a time conflict. Mr. Henderson introduced Christopher J. Mason, Ph.D., Section Chief, Registration and Laboratory Services, Division of Plant Industry, State Department of Agriculture, who would present testimony on A.B. 91 in Mr. Henderson’s absence.
Dr. Mason spoke from prepared text (Exhibit C).
Chairman Rhoads asked Dr. Mason whether the State’s pesticide registration program received federal funding. Dr. Mason said the program received federal funding for the testing of pesticide residues and misuse.
Senator Carlton asked for a comparison between the revenue currently generated by the pesticide registration program and the revenue which would be generated if the registration fees were changed. Dr. Mason said the current registration fees were estimated to be $10,000.
Senator Carlton asked if the fees were capped or set by regulation. Dr. Mason
said the fees had been set by regulation since the 71st Legislative Session. He
said he did not believe the statutes capped the fees.
Chairman Rhoads closed the hearing on A.B. 91 and opened the hearing on A.B. 215.
ASSEMBLY BILL 215 (1st Reprint): Revises provisions governing conservation districts. (BDR 49-780)
Pamela B. Wilcox, Acting Administrator, Division of Conservation Districts, and Administrator and State Land Registrar, Division of State Lands, State Department of Conservation and Natural Resources, explained Nevada’s conservation districts were created in the 1930s. Conservation districts were created in most states during the 1930s in response to the dust blowing off the Great Plains.
The federal government and President Roosevelt created the U.S. Soil Conservation Service to assist ranchers and farmers in the use of their land. At the same time, a model state conservation district law was created and distributed to all 48 states. The federal government suggested the states should pass the model legislation and create conservation districts, the federal government would work with the states in providing voluntarily assistance to local landowners. Nevada enacted the conservation districts law in 1937 and was one of the first states to enact the legislation.
When Nevada enacted the conservation districts law, the conservation districts could and did own land. The statute allowing conservation districts to own land was never removed from the NRS. When the statutes were codified in the 1950s, the provision allowing the conservation districts to own land disappeared from the statutes. Despite extensive research, the reason for the omission had never been determined.
Ms. Wilcox asked the committee members to restore the conservation districts’ ability to own land by reinstating the missing statutory provision.
Ms. Wilcox said the Assembly added section 2 to the bill. As government entities do not pay taxes, section 2, subsections 2 and 3, mandated conservation districts who owned land to pay the county in which the land was located an annual fee in lieu of property taxes.
Ms. Wilcox said she had two conservation district members who would provide testimony. Kevin Piper, Dayton Valley Conservation District, said he fully supported A.B. 215 and its amendments. Mr. Piper said officials in Lyon County felt it appropriate to let the counties determine whether or not to accept annual fees in lieu of taxes from conservation districts.
Chairman Rhoads asked what type of land the conservation districts would purchase. Mr. Piper said most of the property purchased would be for conservation easements. The issue of whether or not conservation districts could own land was a legal gray area.
James Settlemeyer, Owner, Settlemeyer Ranches, and Chairman, Carson Valley Conservation District and Chairman, State Conservation Commission, State Department of Conservation and Natural Resources, explained the reason for the bill. Mr. Settlemeyer said Nevada’s conservation districts were interested in obtaining conservation easements, but could not own easements unless permitted to own real property.
Mr. Settlemeyer discussed the effect of urban sprawl and growth on agricultural land. The farmers and ranchers do not want to sell their property and the communities do not want the land developed. However, development rights of the agricultural property are very valuable. Ranchers and farmers wanted the ability to sell the development rights and enter in conservation easements in perpetuity. Different agencies provided funding in the past for conservation easements. Those agencies did not want the responsibility of policing the conservation easements.
Chairman Rhoads asked which agencies provided funding for conservation easements in Nevada. Mr. Settlemeyer told him the U.S. Department of the Interior (USDI), Bureau of Land Management, the U.S. Department of Agriculture (USDA) Forest Service and the Nature Conservancy had provided funding in the past. Different agencies were interested in different pieces of property.
In 2000, the residents of Carson Valley attempted to fund the purchase of conservation easements by passing an additional tax. The measure failed at the polls. Mr. Settlemeyer said some members of the agricultural community did not trust government agencies. Because of the mistrust, those individuals preferred to have the conservation districts control the conservation easements. The conservation districts agreed to provide oversight for the conservation easements, but could not since the conservation districts were not permitted to own real property.
Chairman Rhoads asked whether or not conservation easements already existed in Carson Valley. Mr. Settlemeyer said there were a couple situations in Carson Valley, which he termed “extremely unique.” One situation developed when a property owner donated his development rights and received a tax write off for the donation. Traditional agriculturists could not afford to donate their development rights. A county’s version of a conservation easement did not qualify for a tax write off from the Internal Revenue Service (IRS). The reason for that being conservation easements were not ironclad and could be easily changed. The IRS did not permit farmers and ranchers to lower their tax base for death taxes by donating their development rights for conservation easements.
Ms. Wilcox said:
If I could add for the record, there are two districts who currently hold land. They’ve held it for a long time, since before we realized they couldn’t. The Lamoille Conservation District owns, what I guess, was the old school building and now is kind of a community hall. And, they have it open for people to meet in. The Lincoln County District also owns a small, modular office building which is the county’s agricultural services center. So, I mean, we need to straighten this out one way or the other.
Chairman Rhoads said he wanted to know whether A.B. 215 had been amended. Ms. Wilcox said Clark County provided an amendment to the bill and she had no objections to the amendment.
Chairman Rhoads said the committee members would vote on A.B. 215 on Monday, May 5, 2003.
Dan Musgrove, Lobbyist, Clark County, spoke on behalf of the Clark County assessor’s office. Mr. Musgrove said the first reprint of the bill contained a technical problem. Section 3 mandated the county assessors mail out tax bills for property owned by Nevada conservation districts. Mr. Musgrove explained it was the county treasurer’s responsibility to mail the tax bills, not the county assessor’s. Mr. Musgrove’s proposed amendment (Exhibit D) corrected the error. Mr. Musgrove said he discussed Exhibit D with Assemblyman Lynn Hettrick who had no problems with the amendment.
Senator McGinness asked whether the term “ex officio tax receiver” is a legal term for “treasurer.” Mr. Musgrove replied the term “ex officio tax receiver” is used in the statutes and refers to a county treasurer.
Dan Kaffer, Western Nevada Resource Conservation and Development Council, said he supported A.B. 215. He stated the council is comprised of 20 elected officials from Nevada’s six western counties. The members felt it important for the conservation districts to own real property and/or conservation easements.
Mr. Kaffer said he also represented the USDA’s Natural Resources Conservation Service which provided oversight for the federal Farm and Ranch Protection Program. Funds from that program might be available for Nevada’s ranchers and farmers. If available, the funding would provide millions of dollars toward the purchase of conservation easements in Nevada.
The funding for the federal Farm and Ranch Protection Program was contained in the 2002 federal Farm Bill. The bill has $650 million available nationwide. If funding were made available to Nevada’s conservation districts through the USDA, an organization needed to be responsible for the management of the conservation easements. Mr. Kaffer said the conservation districts were the likely candidates to provide management and oversight for the conservation easements.
Steve K. Walker, Lobbyist, Douglas County, said Douglas County had been neutral on the bill until amended. He said Douglas County did not like the original language in the bill referring to tax collection by the counties. The language had been modified and Douglas County now supported the measure.
Chairman Rhoads closed the hearing on A.B. 215 and opened the hearing on A.B. 485. He announced the committee members would vote May 5, 2003, on all measures heard April 29, 2003.
ASSEMBLY BILL 485 (2nd Reprint): Revises provisions relating to relief from liability for certain persons regarding certain real property at which hazardous substance has been or may have been released. (BDR 40-776)
Allen Biaggi, Administrator, Division of Environmental Protection (DEP), State Department of Conservation and Natural Resources, read from prepared text (Exhibit E).
Chairman Rhoads asked whether the cleanup of the 7-Eleven on Carson Street in Carson City would be considered a Brownsfield site as described in Exhibit E. He noted the project had been underway for an extended period of time.
Mr. Biaggi told him the 7-Eleven project is an ongoing cleanup by the DEP through the division’s Underground Storage Tank program. There were approximately 220 cleanup sites throughout Nevada.
Chairman Rhoads asked whether funding is available for such cleanup projects. He said he thought the Legislature appropriated funding for cleanup projects. Mr. Biaggi said there were two funds to pay for cleanup projects: the federal government’s Leaking Underground Storage Tank Fund (LUST) and Nevada’s Petroleum Fund. The LUST fund is used when an owner and/or operator could not or would not do the required cleanup. The State’s program operates much like an insurance program and provides reimbursement to owners and/or operators for cleanup costs.
Senator Alice Costandina (Dina) Titus, Clark County Senatorial District No. 7, said she sponsored the original Brownfields bill in the Nevada Legislature. She previously appeared before the Senate Committee on Natural Resources testifying in favor of a bill creating a revolving fund in the DEP. The fund would accept federal dollars and regrant those dollars to qualified applicants to assist in the cleanup of contaminated land. She reiterated previously presented testimony stating it is very important to provide positive incentives to companies and individuals to encourage the cleanup of contaminated land. Reclaimed land is good for businesses, the health of the State, and the environment.
Senator Titus said protection from liability was one incentive the State could provide the owners and/or operators of contaminated lands. A balance had to be provided; public hazards could not be ignored for the sake of good business nor could businesses be hamstrung in case of potential future harm.
Assembly Bill 485 is an extension of the liability protection contained in the original Brownfields bill and allowed a company that would otherwise not be qualified to receive protection from liability.
Senator Titus said she was generally supportive of protecting companies from liability and wanted another built-in safeguard. Senator Titus distributed a proposed amendment to A.B. 485 (Exhibit F) which provided the safeguard.
Senator Titus said federal statutes mandated the reporting of migratory hazardous materials. Information concerning real property with hazardous materials, both stationary and migratory, needed to be available at the State level. The reporting mechanism is important especially when real property slated for development is exempted from liability. Senator Titus said she would let DEP determine the level of hazardous material which had to be reported.
Chairman Rhoads closed the hearing on A.B. 485 and reopened the hearing on A.B. 215.
Assemblyman Lynn C. Hettrick, Assembly District No. 39, said two of Nevada’s conservation districts already owned real property. Mr. Hettrick reiterated previous testimony detailing the fact conservation districts were once allowed to own real property, but the statutory provision disappeared during codification in the 1950s. Assembly Bill 215 codified the original legislation passed in 1937. It had been amended to permit the counties to decide whether a conservation district should pay property taxes on real property owned by the district. Members of the Assembly Committee on Natural Resources were concerned about property taxes potentially owed by conservation districts. The committee members wanted county commissions to have the ability to make such a decision.
Chairman Rhoads said Mr. Hettrick’s constituents provided the committee members with excellent testimony on that point.
Senator McGinness asked whether Mr. Hettrick had seen the amendment contained in Exhibit D. Mr. Hettrick stated he had seen the amendment and had no problems with it. He said he thought the amendment was a technical one.
Chairman Rhoads closed the hearing on A.B. 215 and reopened the hearing on A.B. 485.
Mr. Biaggi stated the DEP supported Senator Titus’ amendment (Exhibit F).
Senator Amodei referred to section 1, subsection 3, paragraph (a) and said the provision mentioned property liens. He asked Mr. Biaggi who owned the property mentioned in that provision. Mr. Biaggi said the provision referred to property falling under the provisions of the cleanup program. The provision was not a blanket-wide provision.
Senator Amodei asked how the provision affected the State’s ability to condemn property for a legally authorized public purpose. Mr. Biaggi said the issue of potential liens on real property had been brought up by the Nevada Department of Transportation. Mr. Biaggi said he and his staff were trying to understand the implications of the provision mentioned by Senator Amodei. The lien provision of the bill placed in A.B. 485 was based on a federal law which ensured property owners did not receive a windfall from the federal government. Mr. Biaggi explained when the federal government cleaned a contaminated property, the property’s value often increased. The federal agency responsible for the cleanup could be reimbursed the cleanup costs. Federal law did not allow a private property owner to benefit financially from the cleanup.
Mr. Biaggi said the lien provision in A.B. 485 mirrored federal law. He cited an example where the provision might apply in Nevada. He said the Division of State Lands, State Department of Conservation and Natural Resources, wanted to recoup the cleanup costs when it cleaned a contaminated property. The division did not want to make a profit off the cleanup. Mr. Biaggi said people needed to understand the implication the lien provision would have on NDOT property, State-owned property, and condemned lands. Senator Amodei asked whether the implications could be addressed through regulation. Mr. Biaggi said he thought the implications could be addressed through regulation.
Mr. Biaggi stated he would make a commitment to the committee members, NDOT, and the Division of State Lands to work with them to address the lien provision of A.B. 485 and its potential effect on Nevada through regulation.
Senator Amodei asked whether the proposed amendment added substance to an existing statutory provision instead of duplicating an existing statute or bill. Mr. Biaggi replied he thought Exhibit F added value by inserting the reporting requirement into the revised brownfield provisions. Mr. Biaggi said he was not sure if the existing reporting requirement contained in State law and regulations applied to the revised brownfield provisions. The amendment was a good one and would add value to the Brownfields program.
Senator Amodei asked whether Mr. Biaggi’s department had been the prime sponsor of A.B. 485 in the Assembly. He said he thought the Assembly might recede to the amendment. Mr. Biaggi said Landwell Company had requested the bill.
Terry Graves, Lobbyist, Landwell Company, introduced the following individuals who testified on A.B. 485: Dan H. Stewart, President and CEO, Landwell Company; Steve Rice, General Counsel Landwell Company, and Tony F. Sanchez, Lobbyist, Landwell Company. Mr. Graves said the bill further advanced the cleanup of Brownfields sites. Mr. Graves provided the committee members with a brief history of A.B. 485 (Exhibit G). The measure had been unanimously approved by the Assembly and sent to the Senate on April 22, 2003. The Assembly amended the bill twice. The amendments provided clarification and did not substantively change the bill. The first amendment clarified the lien provision while the other amendment clarified the liability issue. He said Assemblywoman Barbara Buckley requested the liability amendment.
Mr. Rice said in January 2002 Congress passed the Brownfields Revitalization and Environmental Restoration Act. The act presented potential opportunities for developers and municipalities. The federal legislation provided grants and opportunities for developers who purchased contaminated property after appropriate due diligence to apply for liability protection. A number of states had proposed or passed legislation modeled after the federal act which provided the same opportunities for environmental protection.
Mr. Rice explained Exhibit G which outlined what the bill would and would not do.
Chairman Rhoads asked in what activities the Landwell Company was engaged. Mr. Stewart said the Landwell Company is the development arm of BMI Industries and is engaged in Brownfields redevelopment. Mr. Stewart noted A.B. 485 did not release either BMI Industries or Landwell Company from any liability.
Senator Carlton said she wanted to know if Mr. Stewart had objections to Senator Titus’ proposed amendment to the bill (Exhibit F). Mr. Stewart said he had no objections to the proposed amendment.
Barry C. Duncan, Lobbyist, Southern Nevada Homebuilders Association, said he fully supported A.B. 485 as it provided a balanced approach to environmental cleanup. He said he appreciated Senator Titus’ work on the bill.
Chairman Rhoads asked whether Mr. Duncan supported Senator Titus’ amendment to the bill. Mr. Duncan said due to his lack of involvement in the legislation, he would have to defer to his colleagues on the amendment.
Stephanie D. Garcia-Vause, Lobbyist, City of Henderson, said she supported the bill. She had not had an opportunity to review the amendment and deferred to the Landwell Company on the amendment. Ms. Garcia-Vause said passage of A.B. 485 would bring State regulations into alignment with federal regulations, which could potentially lead to a more expedited annexation and development of the Landwell Company’s property in Henderson.
There being no further business, Chairman Rhoads adjourned the Senate Committee on Natural Resources at 2:26 p.m.
RESPECTFULLY SUBMITTED:
Lee-Ann Keever,
Committee Secretary
APPROVED BY:
Senator Dean A. Rhoads, Chairman
DATE: