AB528 - Revises provisions relating to property tax abatements for certain buildings and structures which meet certain energy efficiency standards. (BDR 58-425)

REQUIRES TWO-THIRDS MAJORITY VOTE (§ 2) A.B. 528 - *AB528* ASSEMBLY BILL NO. 528–COMMITTEE ON GROWTH AND INFRASTRUCTURE (ON BEHALF OF THE JOINT INTERIM STANDING COMMITTEE ON GROWTH AND INFRASTRUCTURE) MARCH 24, 2025 ____________ Referred to Committee on Growth and Infrastructure SUMMARY—Revises provisions relating to property tax abatements for certain buildings and structures which meet certain energy efficiency standards. (BDR 58-425) FISCAL NOTE: Effect on Local Government: May have Fiscal Impact. Effect on the State: Yes. ~ EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted. AN ACT relating to energy; authorizing the Director of the Office of Energy to accept new applications for property tax abatements for certain buildings and structures which meet certain energy efficiency standards; revising requirements for the Green Building Rating System adopted by the Director; revising the duration and amount of partial abatements that are available; requiring the Director to adopt certain regulations; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing law requires the Director of the Office of Energy to grant a partial 1 abatement of certain property taxes for a building or other structure that meets 2 certain energy efficiency standards under the Green Building Rating System 3 adopted by the Director. However, existing law prohibits the Director from: (1) 4 approving applications for the partial tax abatement submitted on or after July 1, 5 2021; and (2) altering or amending the Green Building Rating System after that 6 date. (NRS 701A.100, 701A.110) Section 2 of this bill removes the prohibition on 7 the Director approving applications on or after July 1, 2021, thereby allowing the 8 Director to begin approving applications for the partial abatement again. Section 2 9 revises the amount and duration of the partial abatement available to buildings and 10 other structures meeting certain requirements to provide: (1) a partial abatement of 11 20-35 percent annually for a duration of not more than 10 years for a building or 12 – 2 – - *AB528* other structure that is new; (2) a partial abatement of 20-35 percent annually for a 13 duration of not more than 5 years for an existing building or other structure which 14 did not receive a partial abatement before July 1, 2021; and (3) a partial abatement 15 of 5 percent annually for a duration of not more than 3 years for an existing 16 building or structure that previously received a partial abatement before July 1, 17 2021, and which is recertified under the Green Building Rating System. 18 Existing law requires the Green Building Rating System adopted by the 19 Director to include standards and ratings equivalent to the standards and ratings 20 provided pursuant to the Leadership in Energy and Environmental Design (LEED) 21 Green Building Rating System or an equivalent rating system. (NRS 701A.100) 22 Section 1 of this bill revises the requirements for the Green Building Rating System 23 adopted by the Director. Section 1 requires the Green Building Rating System 24 adopted by the Director to require a building or other structure which did not 25 receive an abatement before July 1, 2021, to obtain certain resilience credits to meet 26 the equivalent of the silver, gold, platinum or zero carbon level. The amount of the 27 partial abatement which a building or other structure is eligible to receive pursuant 28 to section 2 relates to which of these levels the building or other structure meets. 29 Section 1 requires the Director to adopt regulations identifying the credits under the 30 LEED Green Building Rating System or equivalent rating system that are deemed 31 resilience credits for the purposes of the Green Building Rating System adopted by 32 the Director. Section 1 requires the Green Building Rating System to require a new 33 building or other structure to have energy performance which exceeds the 34 applicable building code by certain percentage amounts to meet the equivalent of 35 the silver, gold or platinum level. Section 1 requires the Green Building Rating 36 System to require an existing building or other structure that has not previously 37 received a partial abatement to: (1) qualify for the alternative deduction for energy 38 efficient building retrofit property under the Internal Revenue Code; and (2) to 39 achieve net zero carbon emissions to meet the equivalent of the zero carbon level. 40 Section 1 requires the Green Building Rating System to require a building or other 41 structure that received a partial abatement before July 1, 2021, to obtain 42 recertification under the LEED Green Building Rating System or its equivalent and 43 either have energy performance which meets the requirements of the building code 44 of the applicable jurisdiction with respect to new buildings or qualify for the 45 alternative deduction for energy efficient building retrofit property. Section 1 46 requires the Green Building Rating System to require a building or other structure 47 that includes connected parking to obtain certain certifications with respect to such 48 parking. 49 Section 2 requires the Director to adopt regulations: (1) prescribing a procedure 50 for the State or a local government to obtain a partial abatement and, in exchange 51 for compensation, assign it to another building or other structure in the same county 52 that has also received a partial abatement; and (2) requiring recipients of a partial 53 abatement to annually report to the Office of Economic Development the energy 54 and water consumption of the building or other structure that is subject to a partial 55 abatement and such other information as the Director requires. Section 2 requires 56 the Director to include information relating to energy and water savings by 57 buildings and other structures that received a partial abatement in the annual report 58 the Director is required to submit to the Office. 59 – 3 – - *AB528* THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS: Section 1. NRS 701A.100 is hereby amended to read as 1 follows: 2 701A.100 1. The Director of the Office of Energy shall adopt 3 a Green Building Rating System for the purposes of determining the 4 eligibility of a building or other structure for a tax abatement 5 pursuant to NRS 701A.110. [The Director shall not alter or amend 6 the Green Building Rating System adopted pursuant to this section 7 after July 1, 2021, and the standards and ratings in effect on that 8 date shall remain in effect.] 9 2. The Green Building Rating System must include standards 10 and ratings equivalent to the standards and ratings provided pursuant 11 to the Leadership in Energy and Environmental Design Green 12 Building Rating System or an equivalent rating system, except that 13 the standards adopted by the Director: 14 (a) Except as otherwise provided in paragraphs (b) [and (c),] to 15 (e), inclusive, must not include: 16 (1) Any standard that has not been included in the 17 Leadership in Energy and Environmental Design Green Building 18 Rating System or the equivalent rating system for at least 2 years; or 19 (2) Standards for homes; 20 (b) Must provide reasonable exceptions based on the size of the 21 area occupied by the building or other structure; [and] 22 (c) Must require a building or other structure , except for a 23 building or other structure that is subject to paragraph (f), to 24 obtain: 25 (1) At least [5 points] 1 point in [the Optimize Energy 26 Performance] resilience credit [, or its equivalent,] to meet the 27 equivalent of the silver level; 28 (2) At least [7] 2 points in [the Optimize Energy 29 Performance] resilience credit [, or its equivalent,] to meet the 30 equivalent of the gold level; and 31 (3) At least [11] 3 points in [the Optimize Energy 32 Performance] resilience credit [, or its equivalent,] to meet the 33 equivalent of the platinum or zero carbon level. 34 (d) Must require a building or other structure, except for a 35 building or other structure that is subject to paragraph (e) or (f), 36 to have energy performance which is: 37 (1) At least 5 percent more efficient than the applicable 38 building code, to meet the equivalent of the silver level; 39 (2) At least 10 percent more efficient than the applicable 40 building code, to meet the equivalent of the gold level; and 41 – 4 – - *AB528* (3) At least 15 percent more efficient than the applicable 1 building code, to meet the equivalent of the platinum level. 2 (e) Must require a building or other structure that qualifies for 3 an abatement under the Leadership in Energy and Environmental 4 Design “Existing Buildings: Operations and Maintenance” rating 5 system, or its equivalent, except for a building or structure that is 6 subject to paragraph (f): 7 (1) To qualify for the alternative deduction for energy 8 efficient building retrofit property described in 26 U.S.C. § 9 179D(f); and 10 (2) To achieve net zero carbon emissions, to meet the 11 equivalent of the zero carbon level. 12 (f) Must require a building or other structure that received a 13 partial abatement pursuant to NRS 701A.110 before July 1, 2021, 14 to obtain recertification under the Leadership in Energy and 15 Environmental Design “Existing Buildings: Operations and 16 Maintenance” rating system or its equivalent and: 17 (1) Have energy performance which meets the 18 requirements of the building code in the applicable jurisdiction 19 with respect to new buildings or structures; or 20 (2) Qualify for the alternative deduction for energy efficient 21 building retrofit property described in 26 U.S.C. § 179D(f). 22 (g) Must require a building or other structure which includes 23 connected parking to obtain: 24 (1) If the connected parking is a parking structure, 25 certification pursuant to the Parksmart Certification Standard 26 administered by Green Business Certification Inc. or an 27 equivalent certification system; or 28 (2) If the connected parking is a parking lot, certification 29 pursuant to the SITES Rating System administered by Green 30 Business Certification Inc. or an equivalent certification system. 31 3. The Director shall adopt regulations identifying the credits 32 provided pursuant to the Leadership in Energy and 33 Environmental Design Green Building Rating System or an 34 equivalent rating system which are deemed resilience credits for 35 the purposes of paragraph (c) of subsection 2. In selecting such 36 credits, the Director shall consider the potential benefits such 37 credits will have on building, site and community resilience, 38 including, without limitation, in reducing the heat island effect, 39 improving flood management and increasing indoor and outdoor 40 water efficiency. Such credits may include, without limitation: 41 (a) Energy and Atmosphere, Renewable Energy credit; 42 (b) Sustainable Sites, Heat Island Reduction credit; 43 (c) Sustainable Sites, Enhanced Resilient Site Design credit; 44 (d) Water Efficiency, Enhanced Water Efficiency credit; 45 – 5 – - *AB528* (e) Water Efficiency, Water Metering and Leak Detection 1 credit; or 2 (f) Indoor Environmental Quality, Resilient Spaces credit. 3 4. As used in this section [, “home”] : 4 (a) “Connected parking” means a parking structure or 5 parking lot that is physically connected to and serves a building or 6 other structure and is owned or leased by the owner of the 7 building or other structure or a subsidiary of the owner. A parking 8 structure or parking lot may be physically connected to a building 9 or other structure by an elevated or ground-level walkway or 10 sidewalk, by an elevator or by direct entry. 11 (b) “Home” means a building or other structure for which the 12 principal use is as a residential dwelling for not more than four 13 families. 14 Sec. 2. NRS 701A.110 is hereby amended to read as follows: 15 701A.110 1. Except as otherwise provided in this section, the 16 Director, in consultation with the Office of Economic Development, 17 shall grant a partial abatement from the portion of the taxes imposed 18 pursuant to chapter 361 of NRS, other than any taxes imposed for 19 public education, on a building or other structure that is determined 20 to meet the equivalent of the silver level or higher by an 21 independent contractor authorized to make that determination in 22 accordance with the Green Building Rating System adopted by the 23 Director pursuant to NRS 701A.100 [,] or, in the case of a building 24 or other structure that received an abatement pursuant to this 25 section before July 1, 2021, that is recertified under the Green 26 Building Rating System adopted by the Director, if: 27 (a) [No] Except in the case of a building or other structure that 28 is owned by the State or a local government, no funding is 29 provided by any governmental entity in this State for the acquisition, 30 design, construction or renovation of the building or other structure 31 or for the acquisition of any land therefor. For the purposes of this 32 paragraph: 33 (1) Private activity bonds must not be considered funding 34 provided by a governmental entity. 35 (2) The term “private activity bond” has the meaning 36 ascribed to it in 26 U.S.C. § 141. 37 (b) The owner of the property: 38 (1) Submits an application for the partial abatement to the 39 Director . [before July 1, 2021.] If such an application is submitted 40 for a project that has not been completed on the date of that 41 submission and there is a significant change in the scope of the 42 project after that date, the application must be amended to include 43 the change or changes. 44 – 6 – - *AB528* (2) Except as otherwise provided in this subparagraph, 1 provides to the Director, within 48 months after applying for the 2 partial abatement, proof that the building or other structure meets 3 the equivalent of the silver level or higher, as determined by an 4 independent contractor authorized to make that determination in 5 accordance with the Green Building Rating System adopted by the 6 Director pursuant to NRS 701A.100 [.] or, the case of a building or 7 other structure that received an abatement pursuant to this section 8 before July [Text truncated for display. Full text available on LegiScan.]