S.B. 402
- *SB402*
SENATE BILL NO. 402–SENATOR FLORES
MARCH 17, 2025
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JOINT SPONSORS: ASSEMBLYMEMBERS WATTS AND DELONG
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Referred to Committee on Government Affairs
SUMMARY—Provides for the creation of restoration improvement
districts for building restoration projects.
(BDR 22-332)
FISCAL NOTE: Effect on Local Government: May have Fiscal Impact.
Effect on the State: Yes.
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EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.
AN ACT relating to taxation; authorizing the governing body of a
county or city to create a restoration improvement district
for the purpose of a project to restore certain buildings
that are at least 50 years of age; authorizing under certain
circumstances the governing body of a county or city to
pledge certain property tax proceeds for the costs of such
a project; establishing certain requirements for contracts
or agreements for construction work performed on such a
project; and providing other matters properly relating
thereto.
Legislative Counsel’s Digest:
This bill authorizes the governing body of a county or city in which a building 1
restoration project is or is expected to be located to create a restoration 2
improvement district that includes the project, or a part of the project, within its 3
boundaries. Section 3 of this bill defines the criteria for a project to qualify as a 4
building restoration project. Under section 7 of this bill, the governing body of a 5
county or city which creates a restoration improvement district is authorized to 6
pledge a portion of the property taxes collected in the district during a fiscal year. 7
Section 8 of this bill provides that the amount of the property taxes pledged is equal 8
to the property tax revenue, excluding certain property tax rates, collected in the 9
district in excess of the property tax revenue collected in the district before the 10
creation of the district. Sections 9 and 12 of this bill exclude a district created 11
pursuant to section 7 from certain limitations on the amount of revenue that a local 12
government is authorized to collect from property taxes. Section 10 of this bill 13
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provides that such money would be pledged to the developer of the project for 14
certain costs of the project pursuant to an agreement entered into by the county or 15
city in which the project is located. Section 11 of this bill provides that work 16
performed on a project after the effective date of an ordinance creating a district, 17
pursuant to a contract for construction of the project, is subject to the prevailing 18
wage requirements set forth in existing law. Sections 3-6 of this bill define terms 19
for the purposes of this bill, and section 2 of this bill specifies the applicability of 20
those definitions. 21
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN
SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1. Title 22 of NRS is hereby amended by adding 1
thereto a new chapter to consist of the provisions set forth as 2
sections 2 to 11, inclusive, of this act. 3
Sec. 2. As used in this chapter, unless the context otherwise 4
requires, the words and terms defined in sections 3 to 6, inclusive, 5
of this act have the meanings ascribed to them in those sections. 6
Sec. 3. “Building restoration project” or “project” means a 7
project to improve, rehabilitate, repair, equip, maintain and 8
operate a building, and the site surrounding the building, if: 9
1. The building and the surrounding site are located, in 10
whole or in part, in the municipality creating a restoration 11
improvement district pursuant to section 7 of this act with respect 12
to the district; 13
2. The original structure of the building, excluding any 14
additions, is at least 50 years of age; 15
3. The owner of the building may hold a business license to 16
operate a business at the site of the building, whether or not the 17
owner holds such a license; 18
4. The building has not been open to the public or had any 19
business operated at the site for at least 10 years; and 20
5. As a result of the project, the building will be restored in a 21
manner consistent with the original character of the building. 22
Sec. 4. “Developer” means the person or entity that proposes 23
to undertake a building restoration project. 24
Sec. 5. “District” means a restoration improvement district 25
created pursuant to section 7 of this act. 26
Sec. 6. “Municipality” means any county or city in this State. 27
Sec. 7. 1. The governing body of a municipality may: 28
(a) Create a restoration improvement district for the purposes 29
of carrying out this chapter by adopting an ordinance describing 30
the boundaries of the district, which must be the geographic 31
boundaries of a building restoration project in the municipality, 32
and generally describing the purposes within the district for which 33
money pledged pursuant to this chapter may be used. An 34
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ordinance adopted pursuant to this paragraph must include the 1
findings of the governing body of the municipality that the project 2
qualifies as a building restoration project. 3
(b) For the purposes of carrying out paragraph (a), include in 4
an ordinance adopted pursuant to that paragraph the pledge of the 5
proceeds of any taxes levied for a fiscal year upon taxable real 6
property in the district each year by or for the benefit of the State, 7
the municipality and any public body, in the amount determined 8
pursuant to paragraph (b) of subsection 1 of section 8 of this act. 9
2. A district created pursuant to this section by: 10
(a) A city must be located entirely within the boundaries of 11
that city. 12
(b) A county must be located entirely within the boundaries of 13
that county and, when the district is created, entirely outside of the 14
boundaries of any city. 15
Sec. 8. 1. After the effective date of an ordinance adopted 16
pursuant to section 7 of this act, any taxes levied upon the taxable 17
real property in the district each year by or for the benefit of the 18
State, the municipality and any public body must be divided as 19
follows: 20
(a) That portion of the taxes that would be produced by the 21
rate upon which the tax is levied each year by or for each of those 22
taxing agencies upon the total sum of the assessed value of the 23
taxable real property in the district as shown upon the last 24
equalized assessment roll used in connection with the taxation of 25
the real property by the taxing agency, must be allocated to and 26
when collected must be paid into the funds of the respective taxing 27
agencies as taxes by or for the taxing agencies on all other real 28
property are paid. 29
(b) Except as otherwise provided in this section, the portion of 30
the taxes levied on taxable real property each year in excess of the 31
amount determined pursuant to paragraph (a) must be allocated 32
to, and when collected must be paid into, the restoration 33
improvement district account pertaining to the project to pay 34
money pledged pursuant to paragraph (b) of subsection 1 of 35
section 7 of this act. Unless the total assessed valuation of the 36
taxable real property in the restoration improvement district 37
exceeds the total assessed value of the taxable real property in the 38
district as shown by the last equalized assessment roll referred to 39
in this subsection, all of the taxes levied and collected upon the 40
taxable real property in the district must be paid into the funds of 41
the respective taxing agencies. When all payments required by any 42
agreement entered into pursuant to section 10 of this act have 43
been paid, all money thereafter received from taxes upon the 44
taxable real property in the restoration improvement district must 45
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be paid into the funds of the respective taxing agencies as taxes on 1
all other real property are paid. 2
2. The portion of the taxes levied each year in excess of the 3
amount determined pursuant to paragraph (a) of subsection 1 4
which is attributable to any tax rate levied by a taxing agency: 5
(a) To produce revenue in an amount sufficient to make 6
annual repayments of the principal of, and the interest on, any 7
bonded indebtedness that was approved by a majority of the 8
registered voters within the area of the taxing agency voting upon 9
the question, must be allocated to, and when collected must be 10
paid into, the debt service fund of that taxing agency. 11
(b) In excess of any tax rate of that taxing agency applicable to 12
the last taxation of the real property before the effective date of the 13
ordinance, if that additional rate was approved by a majority of the 14
registered voters within the area of the taxing agency voting upon 15
the question, must be allocated to, and when collected must be 16
paid into, the appropriate fund of that taxing agency. 17
(c) Pursuant to NRS 387.3285 or 387.3287, if that rate was 18
approved by a majority of the registered voters within the area of 19
the taxing agency voting upon the question, must be allocated to, 20
and when collected must be paid into, the appropriate fund of that 21
taxing agency. 22
(d) For the support of the public schools within a county 23
school district pursuant to NRS 387.195, must be allocated to, and 24
when collected must be paid into, the State Education Fund. 25
3. The provisions of paragraph (a) of subsection 2 include, 26
without limitation, a tax rate approved for bonds of a county 27
school district issued pursuant to NRS 350.020, including, without 28
limitation, amounts necessary for a reserve account in the debt 29
service fund. 30
4. As used in this section, the term “last equalized assessment 31
roll” means the assessment roll in existence on the 15th day of 32
March immediately preceding the effective date of the ordinance. 33
Sec. 9. The allowed revenue from taxes ad valorem 34
determined pursuant to NRS 354.59811 does not apply to a district 35
created pursuant to this chapter. 36
Sec. 10. 1. Except as otherwise provided in this section, if 37
the governing body of a municipality adopts an ordinance 38
pursuant to section 7 of this act, the municipality may enter into 39
an agreement with the developer of the building restoration 40
project for the cost of improving, rehabilitating, repairing, 41
equipping, maintaining or operating, or any combination thereof, 42
the project, which may contain such terms as are determined to be 43
desirable by the governing body of the municipality, including the 44
payment of reasonable interest and other financing costs for the 45
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project. Any such reimbursements may be secured by a pledge of, 1
and be payable from, any money pledged pursuant to section 7 of 2
this act and received with respect to the district. If such an 3
agreement is entered into, the agreement must provide for an 4
annual payment to the developer of the money pledged pursuant to 5
section 7 of this act and received by the municipality not later than 6
15 days after the date for such an annual payment specified in the 7
agreement. An agreement entered into pursuant to this section is 8
not subject to the limitations of subsection 1 of NRS 354.626 and 9
may, at the option of the governing body, be binding on the 10
municipality beyond the fiscal year in which it was made, only if 11
the agreement pertains solely to the project. 12
2. No agreement entered into pursuant to this section may be 13
secured by or payable from the general fund of the municipality, 14
the power of the municipality to levy ad valorem property taxes, or 15
any source other than any money pledged pursuant to section 7 of 16
this act and received by the municipality with respect to the 17
district, or any combination thereof. No agreement entered into 18
pursuant to this section may ever become a general obligation of 19
the municipality or a charge against its general credit or taxing 20
powers, nor may any such agreement become a debt of the 21
municipality for purposes of any limitation on indebtedness. 22
3. Any agreement entered pursuant to this section 23
automatically terminates at the end of the fiscal year in which the 24
20th anniversary of the adoption of the ordinance creating the 25
district occurs. 26
Sec. 11. The provisions of NRS 338.013 to 338.090, 27
inclusive, apply to any construction work related to a building 28
restoration project performed after the effective date of an 29
ordinance creating a district adopted pursuant to section 7 of this 30
act with respect to the project, under a contract awarded or an 31
agreement entered into with respect to the project, whether or not 32
the contract was awarded or the agreement was entered into on or 33
after the effective date of that ordinance. If, pursuant to this 34
subsection, the provisions of NRS 338.013 to 338.090, inclusive, 35
are applicable, the governing body, the developer, any contractor 36
who is awarded such a contract or enters into such an agreement 37
to perform the construction work and any subcontractor who 38
performs any portion of the construction work related to such a 39
project shall comply with the provisions of NRS 338.013 to 40
338.090, inclusive, in the same manner as if the governing body 41
had undertaken the project or had awarded the contract. 42
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Sec. 12. NRS 354.59811 is hereby amended to read as 1
follows: 2
354.59811 1. Except as otherwise provided in NRS 244.377, 3
278C.260, 354.59813, 354.59815, 354.59818, 354.5982, 354.5987, 4
354.705, 354.723, 450.425, 450.760, 540A.265 and 543.600, and 5
section 9 of this act, for each fiscal year beginning on or after 6
July 1, 1989, the maximum amount of money that a local 7
government, except a school district, a district to provide a 8
telephone number for emergencies or a redevelopment agency, may 9
receive from taxes ad valorem, other than those attributable to the 10
net proceeds of minerals or those levied for the payment of bonded 11
indebtedness and interest thereon incurred as general long-term debt 12
of the issuer, or for the payment of obligations issued to pay the cost 13
of a water project pursuant to NRS 349.950, or for the payment of 14
obligations under a capital lease executed before April 30, 1981, 15
must be calculated as follows: 16
(a) The rate must be set so that when applied to the current fiscal 17
year’s assessed valuation of all property which was on the preceding 18
fiscal year’s assessment roll, together with the assessed valuation of 19
property on the central assessment roll which was allocated to the 20
local government, but excluding any assessed valuation attributable 21
to the net proceeds of minerals, assessed valuation attributable to a 22
redevelopment area and assessed valuation of a fire protection 23
district attributable to real property which is transferred from private 24
ownership to public ownership for the purpose of conservation, it 25
will produce 106 percent of the maximum revenue allowable from 26
taxes ad valorem for the preceding fiscal year, except that the rate so 27
determined must not be less than the rate allowed for the previous 28
fiscal year, except for any decrease attributable to the imposition of 29
a tax pursuant to NRS 354.59813 in the previous year. 30
(b) This rate must then be applied to the total assessed valuation, 31
excluding the assessed valuation attributable to the net proceeds of 32
minerals and the assessed valuation of a fire protection district 33
attributable to real property which is transferred from private 34
ownership to public ownership for the purpose of conservation, but 35
including new real property, possessory interests and mobile homes, 36
for the current fiscal year to determine the allowed revenue from 37
taxes ad valorem for the local government. 38
2. As used in this section, “general long-term debt” does not 39
include debt created for medium-term obligations pursuant to NRS 40
350.087 to 350.095, inclusive. 41
Sec. 13. This act becomes effective upon passage and 42
approval. 43
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