AB131 - Provides an exemption from property taxation for accessory dwelling units rented or leased to certain tenants. (BDR 32-694)

EXEMPT (Reprinted with amendments adopted on April 17, 2025) FIRST REPRINT A.B. 131 - *AB131_R1* ASSEMBLY BILL NO. 131–ASSEMBLYMEMBER JACKSON PREFILED JANUARY 28, 2025 ____________ Referred to Committee on Government Affairs SUMMARY—Provides an exemption from property taxation for accessory dwelling units rented or leased to certain tenants. (BDR 32-694) FISCAL NOTE: Effect on Local Government: May have Fiscal Impact. Effect on the State: No. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to housing; providing an exemption from property taxation for accessory dwelling units rented or leased to tenants receiving certain tenant-based housing assistance; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing federal law authorizes the Secretary of the United States Department 1 of Housing and Urban Development to provide assistance to public housing 2 agencies for tenant-based assistance through the Housing Choice Voucher Program. 3 (Section 8 of the United States Housing Act of 1937, 42 U.S.C. § 1437f) Section 6 4 of this bill provides an exemption from property taxes for an accessory dwelling 5 unit if the accessory dwelling unit: (1) is rented or leased to a tenant receiving 6 assistance under the Program pursuant to a lease which is for a period of not less 7 than 12 consecutive months; (2) is located on the same parcel as a single-family 8 residence which is the primary residence of the owner of the accessory dwelling 9 unit; (3) complies with all applicable local zoning laws; and (4) if the parcel is 10 located within a common-interest community, complies with all applicable 11 covenants, conditions and restrictions of the community. Section 6 requires a 12 person claiming the exemption to annually file with the county assessor: (1) certain 13 verifications from the appropriate public housing authority; and (2) a copy of the 14 lease. Section 6 also: (1) prohibits the exemption from being granted for more than 15 one accessory dwelling unit per parcel; and (2) requires the county assessor to 16 determine the value of the accessory dwelling unit based on the cost of replacing 17 the accessory dwelling unit. Section 7 of this bill makes a conforming change to 18 indicate the proper placement of section 6 in the Nevada Revised Statutes. 19 – 2 – - *AB131_R1* THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. (Deleted by amendment.) 1 Sec. 2. (Deleted by amendment.) 2 Sec. 3. (Deleted by amendment.) 3 Sec. 4. (Deleted by amendment.) 4 Sec. 5. (Deleted by amendment.) 5 Sec. 6. Chapter 361 of NRS is hereby amended by adding 6 thereto a new section to read as follows: 7 1. An accessory dwelling unit is exempt from taxation if, for 8 the year in which the exemption applies, the accessory dwelling 9 unit: 10 (a) Is rented or leased to a qualified tenant receiving 11 assistance under the Housing Choice Voucher Program pursuant 12 to a written lease which is for a period of not less than 12 13 consecutive months; 14 (b) Is located on the same parcel as a single-family residence 15 which is the primary residence of the owner of the accessory 16 dwelling unit; 17 (c) Complies with all applicable local zoning laws; and 18 (d) If the parcel is located within a common-interest 19 community, complies with all applicable covenants, conditions and 20 restrictions of the common-interest community. 21 2. Any person claiming an exemption pursuant to this section 22 must file annually with the county assessor: 23 (a) Verification from the appropriate public housing authority 24 that: 25 (1) The person has entered into a housing assistance 26 payment contract with the public housing authority to receive 27 tenant-based assistance payments under the Housing Choice 28 Voucher Program for the accessory dwelling unit; 29 (2) The qualified tenant to whom the accessory dwelling 30 unit is rented or leased is receiving assistance under the Housing 31 Choice Voucher Program pursuant to a written lease which is for 32 a period of not less than 12 consecutive months; and 33 (3) The accessory dwelling unit, at the time it was last 34 inspected, met the housing quality standards set forth in 42 U.S.C. 35 1437f(o); and 36 (b) A copy of the lease for the accessory dwelling unit, which 37 must set forth, without limitation, the total square footage of the 38 accessory dwelling unit. 39 3. The person may claim an exemption pursuant to this 40 section for one accessory dwelling unit per parcel. 41 – 3 – - *AB131_R1* 4. To determine the value of the accessory dwelling unit for 1 the purposes of an exemption claimed pursuant to this section, the 2 value is equal to the cost of replacing the accessory dwelling unit, 3 which must be calculated by the county assessor in accordance 4 with the regulations adopted by the Nevada Tax Commission 5 pursuant to subsection 6 of NRS 361.227. 6 5. A county assessor may prescribe forms and adopt 7 procedures for claiming the exemption pursuant to this section not 8 inconsistent with any regulations, forms and procedures 9 prescribed or adopted by the Department or the Nevada Tax 10 Commission. 11 6. As used in this section: 12 (a) “Accessory dwelling unit” means an ancillary or secondary 13 living unit that has a separate egress, kitchen, bathroom and 14 sleeping area existing on the same lot as a single-family residence. 15 (b) “Housing Choice Voucher Program” means the federal 16 tenant-based assistance program established under 42 U.S.C. 17 1437f(o). 18 (c) “Qualified tenant” means a person who is not employed by 19 or related to the owner of the property on which the accessory 20 dwelling unit is located by consanguinity or affinity within the 21 third degree. 22 Sec. 7. NRS 361.160 is hereby amended to read as follows: 23 361.160 1. Personal property in transit through this State is 24 personal property: 25 (a) Which is moving in interstate commerce through or over the 26 territory of the State of Nevada; or 27 (b) Which was consigned to a warehouse, public or private, 28 within the State of Nevada from outside the State of Nevada for 29 storage in transit to a final destination outside the State of Nevada, 30 whether specified when transportation begins or afterward. 31  Such property is deemed to have acquired no situs in Nevada for 32 purposes of taxation. Such property is not deprived of exemption 33 because while in the warehouse the property is assembled, bound, 34 joined, manufactured, processed, disassembled, divided, cut, broken 35 in bulk, relabeled or repackaged, or because the property is being 36 held for resale to customers outside the State of Nevada. The 37 exemption granted shall be liberally construed to effect the purposes 38 of NRS 361.160 to 361.185, inclusive. 39 2. Personal property within this State as mentioned in NRS 40 361.030 and 361.045 to 361.155, inclusive, and section 6 of this act 41 does not include personal property in transit through this State as 42 defined in this section. 43 Sec. 8. The Legislature hereby finds that the exemption 44 provided by this act from any ad valorem tax on property: 45 – 4 – - *AB131_R1* 1. Will achieve a bona fide social or economic purpose and that 1 the benefits of the exemption are expected to exceed any adverse 2 effect of the exemption on the provision of services to the public by 3 the State or a local government that would otherwise receive 4 revenue from the tax from which the exemption would be granted; 5 and 6 2. Will not impair adversely the ability of the State or a local 7 government to pay, when due, all interest and principal on any 8 outstanding bonds or any other obligations for which revenue from 9 the tax from which the exemption would be granted was pledged. 10 Sec. 9. 1. This section becomes effective upon passage and 11 approval. 12 2. Sections 1 to 8, inclusive, of this act become effective: 13 (a) Upon passage and approval for the purpose of adopting any 14 regulations and performing any other preparatory administrative 15 tasks that are necessary to carry out the provisions of this act; and 16 (b) On July 1, 2026, for all other purposes. 17 H