AB540 - Revises provisions relating to governmental administration. (BDR 25-1036)

- 83rd Session (2025) Assembly Bill No. 540–Committee on Government Affairs CHAPTER.......... AN ACT relating to governmental administration; creating the Nevada Attainable Housing Account and setting forth the allowable uses of money in the Account; requiring an eligible entity to provide or secure certain matching funds as a condition of receiving money from the Account; requiring the Administrator of the Housing Division of the Department of Business and Industry to adopt annually an allocation plan for attainable housing; requiring the Division to submit a report to the Interim Finance Committee relating to the Account; creating and setting forth the duties of the Nevada Attainable Housing Council; renaming the position of Housing Advocate within the Division as the Housing Liaison; revising provisions relating to the statewide low- income housing database maintained by the Division; revising provisions relating to the Account for Affordable Housing; authorizing the Division to establish programs for the reporting of rental payments to credit reporting agencies; revising provisions governing the sale, lease or conveyance of certain real property by the governing body of a county or city; requiring the governing body of a county or city to adopt certain expedited processes relating to attainable housing; revising provisions relating to the tiers of affordable housing; revising provisions relating to certain reports submitted to the Division by certain local governments relating to affordable housing; requiring, under certain circumstances, the State Contractors’ Board to issue licenses by endorsement or provisional licenses to certain persons to perform work on attainable housing projects in certain rural areas; requiring, under certain circumstances, the State Contractors’ Board to waive certain fees relating to contractor’s licenses in certain rural areas; requiring the issuance of certain bonds; making various other changes relating to housing; making an appropriation; and providing other matters properly relating thereto. Legislative Counsel’s Digest: Existing law charges the Housing Division of the Department of Business and Industry with certain duties relating to low-income housing and affordable housing. (Chapter 319 of NRS) Section 9 of this bill creates the Nevada Attainable Housing Account in the State General Fund, to be administered by the Division. Section 10 of this bill authorizes the Division to distribute money in the Account to eligible – 2 – - 83rd Session (2025) entities for certain expenditures relating to attainable housing. Section 50 of this bill appropriates $133,000,000 to the Account. Section 11 of this bill requires the Administrator of the Division to adopt an annual allocation plan for disbursing money from the Account. Section 50.5 of this bill requires the Division to include in the initial allocation plan adopted pursuant to section 11 certain allocations of money from the Account for certain purposes authorized by section 10. Section 22 of this bill exempts the Division from complying with the provisions of the Administrative Procedures Act in adopting the annual allocation plan. Section 12 of this bill requires that an eligible entity provide or secure matching funds in an amount not less than the amount of the money awarded to the eligible entity from the Account. Section 14.5 of this bill requires the Division to submit a report of certain information to the Interim Finance Committee at the last meeting of each fiscal year and the last meeting of each calendar year relating to the Account. Section 15 of this bill: (1) creates the Nevada Attainable Housing Council to provide oversight and strategic guidance for the administration and allocation of the Account; and (2) sets forth the membership of the Council. Section 16 of this bill requires the Division to establish procedures to ensure that any member of the Council discloses any direct or indirect financial interest in any attainable housing project or eligible entity that applies for or receives funding from the Account. Section 17 of this bill requires the Council to: (1) review and comment on certain housing reports; and (2) provide recommendations to the Division regarding the allocation and use of money from the Account. Existing law creates the position of Housing Advocate within the Division and establishes the duties for the position, which include providing information and assistance to persons who reside in affordable housing and manufactured housing. (NRS 319.141) Section 17.3 of this bill renames the position of Housing Advocate as the Housing Liaison. Existing law requires the Division to create and maintain a statewide low- income housing database. The database is required to include certain information relating to low-income housing, including compilations and analysis of demographic, economic and housing data from a variety of sources. (NRS 319.143) Section 17.6 of this bill requires the inclusion of any survey conducted by the Division in the database. Section 17.6 also revises the data that is required to be included in the database by: (1) changing the measure for determining the number of households in various population groups experiencing high housing costs from 50 percent to 30 percent of household income; (2) increasing from 2 years to 3 years the length of the planning period for identifying when subsidized units are forecast to convert to market-rate units; and (3) adding information regarding certain multi-family residential housing. Section 17.6 further requires the Division, on or before December 31 of each year, to analyze the data in the database and prepare and post on its website a report of its analysis. Existing law authorizes, with certain exceptions, the Division to: (1) establish certain funds or accounts; and (2) invest or deposit its money, but does not require the Division to keep any of its money in the State Treasury. (NRS 319.170) Section 18 of this bill creates an additional exception to these provisions for the Account created by section 9. Existing law creates the Account for Affordable Housing in the State General Fund, which is required to be administered by the Division, and prescribes the distribution and use of money in the Account. (NRS 319.500, 319.510) Under – 3 – - 83rd Session (2025) existing law, the costs to create and maintain the statewide low-income housing database are required to be paid from the Account up to a maximum of $175,000 per year. (NRS 319.143, 319.510) Sections 17.6 and 18.5 of this bill: (1) require payment from the Account of the costs to prepare the new annual report required by section 17.6; and (2) change the maximum annual amount authorized from the Account for the payment of costs related to the database from the fixed amount of $175,000 to not more than 6 percent of the money deposited in the Account in each fiscal year. Existing law also authorizes the Division to expend not more than $40,000 per year or an amount equal to 6 percent of money received pursuant to the federal HOME Investment Partnerships Act, whichever is greater, as reimbursement for administering the Account and that federal money. (NRS 319.510; 42 U.S.C. §§ 12701 et seq.) Section 18.5: (1) eliminates the authority of the Division to receive reimbursement from the Account for administering that federal money; and (2) changes the maximum amount authorized from the Account as reimbursement for administering the Account to not more than 6 percent of the money deposited in the Account in each fiscal year. Existing law requires the Division to distribute a certain portion of the remaining money in the Account to the Division of Welfare and Supportive Services of the Department of Health and Human Services for a program to provide emergency assistance to needy families with children. (NRS 319.510) Section 18.5 eliminates this required distribution to the Division for this program, but specifically authorizes the use of money in the Account for the same purpose. With the elimination of this distribution to the Division, all of the remaining money in the Account will effectively be distributed to the other authorized recipients in existing law, which are certain charitable organizations, housing authorities and local governments for the acquisition, construction and rehabilitation of affordable housing for eligible families, subject to certain requirements. One such eligibility requirement in existing law is that not less than 15 percent of the units acquired, constructed or rehabilitated be affordable to persons whose income is at or below the federally designated level signifying poverty. (NRS 319.510) Section 18.5: (1) changes the income level for that requirement to be at or below 30 percent of the median monthly gross household income for the applicable county; and (2) clarifies that the money is authorized to be distributed to one or more of the types of entities that are eligible recipients. Section 18.5 also eliminates the eligibility requirement in existing law that a local government sponsor such a project. Sections 2-8 of this bill define certain terms relating to the provisions of sections 2-17. Sections 19 and 20 of this bill authorize the Division to establish a program for the reporting of rental payments to a credit reporting agency. Existing law sets forth certain procedures for a board of county commissioners or governing body of a city to sell or lease real property. (NRS 244.281, 268.061) Sections 23 and 26 of this bill require, before approving the sale or lease of real property for the development of attainable housing, in addition to other procedures, the board or governing body to evaluate the capacity and commitment of the developer to provide long-term benefits to the county in a manner that promotes transparency and does not interfere with equitable competition. Sections 23 and 26 also require the developer to submit certain information to the board or governing body. Existing law authorizes a nonprofit organization to submit to a board of county commissioners or governing body of a city an application for conveyance of certain property that is owned by the county or city, as applicable. The board or governing body may approve such an application if the nonprofit organization demonstrates – 4 – - 83rd Session (2025) that the organization or its assignee will use the property to develop affordable housing. (NRS 244.287, 268.058) Sections 24 and 25 of this bill: (1) instead authorize the board or governing body to approve such an application for attainable housing; and (2) require an application to include certain information. Existing law establishes three tiers of affordable housing for various purposes in existing law and defines “affordable housing” as housing that falls within any of the three tiers. (NRS 232.860, 244.189, 244.287, 268.058, 268.190, 278.0105, 279.385, 279A.020, 279B.020, 315.9625, 319.042) Section 33 of this bill revises the term “affordable housing” to be “attainable housing.” Under existing law, the tiers are based on both household income and the costs of housing as a percentage of that income. With respect to household income: (1) “tier one affordable housing” is housing for a household which has a total monthly gross income that is equal to not more than 60 percent of the median monthly gross household income for the county in which the housing is located, which is commonly known as the area median household income; (2) “tier two affordable housing” is housing for a household which has a total monthly gross income that is equal to more than 60 percent but not more than 80 percent of the area median household income; and (3) “tier three affordable housing” is housing for a household which has a total monthly gross income that is equal to more than 80 percent but not more than 120 percent of the area median household income. In addition, with respect to the costs of housing, affordable housing under existing law is housing that costs not more than 30 percent of the total monthly gross household income of the household with an income at the maximum percentage of the area median household income for the tier. (NRS 278.01902, 278.01904, 278,01906) Section 29.5 of this bill creates a new tier of affordable housing, to be known as “tier one affordable housing,” that addresses housing for a household that has a total monthly gross income that is equal to not more than 30 percent of the area median household income. As a result of the creation of this new tier of affordable housing, section 34 of this bill renames “tier one affordable housing” in existing law as “tier two affordable housing” and changes the percentage range for median income for that tier to more than 30 percent but not more than 60 percent of the area median household income. Section 36 of this bill renames “tier two affordable housing” in existing law for which the percentage range for median income is more than 60 percent, but not more than 80 percent of the area median household income, as “tier three affordable housing.” Section 35 of this bill renames “tier three affordable housing” in existing law, for which the percentage range for median income is more than 80 percent but not more than 120 percent of the area median household income, as “tier four affordable housing.” Section 29 of this bill creates a new tier of affordable housing, to be known as “tier five affordable housing,” that addresses housing for a household that has a total monthly gross income that is equal to not more than 120 percent but not more than 150 percent of the area median household income. Section 37.5 of this bill makes a conforming change to reflect the changes in the tiers. Existing law sets forth an approval process for the subdivision of land that requires a subdivider to submit a tentative map to the planning commission or governing body of a county or city, as applicable. (NRS 278.330) Existing law also requires the tentative map to be forwarded to certain state agencies and local governments for review. (NRS 278.335) Section 31 of this bill requires each reviewing agency to adopt a process for the expedited review of and comment on a tentative map that includes attainable housing. Existing law requires the governing body of each county and city, on or before July 1, 2024, to enact by ordinance an expedited process for the consideration and – 5 – - 83rd Session (2025) approval of projects for affordable housing. (Section 12 of Assembly Bill No. 213, chapter 200, Statutes of Nevada 2023, at p. 1171) Section 30 of this bill requires the governing body of each county and the go [Text truncated for display. Full text available on LegiScan.]