Link to Page 2118

 

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ê2001 Statutes of Nevada, Page 2119 (Chapter 417, SB 530)ê

 

    Sec. 6.  Section 8 of chapter 489, Statutes of Nevada 1999, at page 2530, is hereby amended to read as follows:

    Sec. 8.  1.  The coalition must be governed by a board consisting of 10 members.

    2.  The members of the board must be appointed as follows:

    (a) Two members appointed by the Board of County Commissioners of Clark County from its membership, one of whom is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002;

    (b) Two members appointed by the City Council of the City of Las Vegas from its membership, one of whom is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002;

    (c) Two members appointed by the City Council of the City of North Las Vegas from its membership, one of whom is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002;

    (d) Two members appointed by the City Council of the City of Henderson from its membership, one of whom is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002;

    (e) One member appointed by the City Council of Boulder City from its membership who is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002; and

    (f) One member appointed by the Board of Trustees of the Clark County School District from its membership who is a member of the debt management commission established pursuant to subsection 1 of NRS 350.002.

    3.  The term of each member of the board is coterminous with his term of elected office unless the public entity that appointed him revokes his appointment to the board.

    4.  [If a member fails to attend three consecutive meetings or fails to attend five meetings during a calendar year, his appointment is automatically revoked.

    5.]  If a member is unable to serve for the duration of his term or has his membership revoked, his position becomes vacant. A vacancy on the board must be filled by the authority which was entitled to appoint the member whose position is vacant. A vacancy must be filled within 45 days after the departure of the member. The term of a member appointed by the board to fill a vacancy is the remainder of the term of the member whose position is vacant.

    Sec. 7.  Section 11 of chapter 489, Statutes of Nevada 1999, at page 2531, is hereby amended to read as follows:

    Sec. 11.  The board shall:

    1.  Adopt rules or bylaws that govern its management and affairs [.] , including, without limitation, rules or bylaws pertaining to the attendance of members of the board at meetings of the board.

    2.  Prepare and adopt an annual budget.

    Sec. 8.  This act becomes effective on July 1, 2001.

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ê2001 Statutes of Nevada, Page 2120ê

 

CHAPTER 418, SB 552

Senate Bill No. 552–Committee on Government Affairs

 

CHAPTER 418

 

AN ACT relating to affordable housing; expanding the powers of the housing division of the department of business and industry; exempting the housing division from the state purchasing act; removing certain requirements for loans made by the housing division; and providing other matters properly relating thereto.

 

[Approved: June 5, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 319 of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  Upon the approval of the state board of finance, the division may enter into instruments, agreements and other such transactions for one or more of the following purposes:

    (a) Reducing or modifying the amount or duration of any payment, interest rate, spread or similar risk;

    (b) Lowering the cost of borrowing when used in combination with the issuance or carrying of bonds or investments; or

    (c) Enhancing the relationship between risk and return with respect to the programs of the division for lending or investment or any portion thereof.

    2.  In entering into such instruments, agreements or other such transactions, the division shall consider the creditworthiness of the counterparties and other relevant criteria relating to the objectives of the programs of the division.

    Sec. 2.  NRS 319.140 is hereby amended to read as follows:

    319.140  1.  The division shall administer the provisions of this chapter. The administrator may adopt, amend or rescind regulations, consistent with the provisions of this chapter, appropriate to carry out its purposes.

    2.  The administrator may make copies of all proceedings and other records and documents of the division and issue certificates under the seal of the division to the effect that the copies are true copies, and all persons dealing with the division may rely upon such certificates.

    3.  The division has perpetual succession, subject to termination in accordance with statute, and may [employ] :

    (a) Sue and be sued in its own name, subject to chapter 41 of NRS;

    (b) Adopt an official seal and alter the same at the pleasure of the division;

    (c) Maintain such offices at any place or places within the state as it determines necessary to carry out the provisions of this chapter;

    (d) Adopt, amend and repeal regulations as provided in chapter 233B of NRS, consistent with the provisions of this chapter and appropriate to carry out its purposes;

    (e) Maintain records, proceedings and documents of the division, subject to chapters 239, 239A and 239B of NRS;

    (f) Make and execute contracts and all other instruments necessary or convenient for the exercise of its powers and functions pursuant to this chapter with any governmental agency, private corporation or other entity, or natural person;


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ê2001 Statutes of Nevada, Page 2121 (Chapter 418, SB 552)ê

 

chapter with any governmental agency, private corporation or other entity, or natural person;

    (g) Enter into agreements or other transactions with, and accept grants from and cooperate with, any governmental agency or other source in furtherance of the purposes of this chapter;

    (h) Acquire real or personal property or any interest therein, by gift, purchase, foreclosure, deed in lieu of foreclosure, lease, option or otherwise;

    (i) Hold, sell, assign, lease, encumber, mortgage, release or otherwise dispose of any real or personal property or any interest therein, by public or private sale, with or without public bidding, notwithstanding any other provision of law;

    (j) Employ or contract for the services of attorneys, accountants, financial experts and any other advisers, employees, consultants and agents as the administrator may determine to be necessary [.] ;

    (k) Create or cause to be created legal entities, including nonprofit corporations, grantor trusts and other legal entities, which the division determines are necessary or convenient for the exercise of its powers and duties pursuant to this chapter, provided, however, that the issuance of bonds, notes or other evidence of indebtedness by any legal entity controlled by the division is subject to the approval of the state board of finance;

    (l) Provide advice, technical information, training and educational services related to the development of housing, building technologies and related fields;

    (m) Conduct research, make grants, and promote the development of housing, building technologies and related fields; and

    (n) Do any and all things necessary or appropriate to carry out its purposes and exercise the powers expressly granted pursuant to this chapter.

    4.  Before September 1 of each even-numbered year , the division shall submit a report of its activities for the biennium ending June 30 of that year to the governor, state treasurer and the legislature. Each such report shall set forth a complete operating and financial statement of the division during such biennium. The division shall cause an audit of its books and accounts to be made at least once in each fiscal year by a certified public accountant. The certified public accountant may audit the division’s books and accounts for consecutive audit periods as requested by the division.

    5.  The division is exempt from the provisions of chapter 333 of NRS.

    Sec. 3.  NRS 319.190 is hereby amended to read as follows:

    319.190  [1.]  The division may make, undertake commitments to make and participate with lending institutions in the making of mortgage loans, make temporary loans and advances in anticipation of mortgage loans, and issue letters of credit [pursuant to subsection 2] to finance the acquisition, construction [or] , development, renewal, redevelopment, rehabilitation or refinancing of residential housing, including multifamily housing [. Any loan made by the division pursuant to this section must be insured or guaranteed unless it is financed by an issue of obligations of the division that are insured or secured by surety bonds, letters of credit not issued by the division, guaranties or other means of assuring repayment of those obligations. Such loans may be made or letters of credit issued only after a determination by the administrator that mortgage loans or letters of credit are not otherwise available from private lenders upon reasonable equivalent terms and conditions.


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ê2001 Statutes of Nevada, Page 2122 (Chapter 418, SB 552)ê

 

not otherwise available from private lenders upon reasonable equivalent terms and conditions.

    2.  The division may issue a letter of credit only if sufficient reserves in the funds established by the division are deposited in a separate account to be used to pay any liabilities that may be incurred by issuing the letter of credit. The aggregate amount of outstanding letters of credit issued by the division must not exceed $5,000,000.] , within this state.

    Sec. 4.  NRS 319.200 is hereby amended to read as follows:

    319.200  Any [insured] mortgage loan made by the division [shall:

    1.  Not exceed the amount permitted under the insurance program under which the mortgage is insured.

    2.  Be] must be secured in such manner, be repaid in such period and bear interest at [a] such rate or rates as are determined by the division . [and permitted under the insurance program under which the mortgage is insured. In addition to such interest charges, the division may charge and collect such fees and charges, including reimbursement of the division’s operating expenses, financing costs, service charges, insurance premiums and mortgage insurance premiums as the division determines to be reasonable.]

    Sec. 5.  NRS 319.210 is hereby amended to read as follows:

    319.210  1.  The division may:

    (a) Invest in, purchase or make commitments to purchase, and take assignments from lending institutions of mortgage loans and promissory notes accompanying such mortgage loans, including [federally insured] mortgage loans or participations with lending institutions in such promissory notes and mortgage loans, for the construction, rehabilitation, purchase, leasing or refinancing of residential housing within this state.

    (b) Sell, at public or private sale, with or without public bidding, any mortgage or other obligation held by the division.

    2.  At or before the time of purchase, the lending institution shall certify to the division with respect to all mortgage loans transferred to the division:

    (a) That the mortgage loans transferred to the division are for residential housing for eligible families within this state; or

    (b) That the proceeds of sale or its equivalent will be reinvested in mortgage loans for residential housing for eligible families within this state in an aggregate principal amount equal to the amount of such sale proceeds.

    Sec. 6.  NRS 333.020 is hereby amended to read as follows:

    333.020  As used in this chapter, unless the context otherwise requires:

    1.  “Chief” means the chief of the purchasing division.

    2.  “Director” means the director of the department of administration.

    3.  “Invitation to bid” means a written statement which sets forth the requirements and specifications of a contract to be awarded by competitive selection.

    4.  “Proprietary information” means:

    (a) Any trade secret or confidential business information that is contained in a bid or proposal submitted on a particular contract; or

    (b) Any other trade secret or confidential business information submitted in a bid or proposal and designated as proprietary by the chief.

As used in this subsection, “confidential business information” means any information relating to the amount or source of any income, profits, losses or expenditures of a person, including data relating to cost or price submitted in support of a bid or proposal. The term does not include the amount of a bid or proposal.


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ê2001 Statutes of Nevada, Page 2123 (Chapter 418, SB 552)ê

 

    5.  “Purchasing division” means the purchasing division of the department of administration.

    6.  “Purchasing officer” means a person who is authorized by the chief or a using agency to participate in:

    (a) The evaluation of bids or proposals for a contract;

    (b) Any negotiations concerning a contract; or

    (c) The development, review or approval of a contract.

    7.  “Request for proposals” means a written statement which sets forth the requirements and specifications of a contract to be awarded by competitive selection.

    8.  “Trade secret” has the meaning ascribed to it in NRS 600A.030.

    9.  “Using agencies” means all officers, departments, institutions, boards, commissions and other agencies in the executive department of the state government which derive their support from public money in whole or in part, whether the money is provided by the State of Nevada, received from the Federal Government or any branch, bureau or agency thereof, or derived from private or other sources. The term does not include the Nevada rural housing authority, the housing division of the department of business and industry, local governments as defined in NRS 354.474, conservation districts, irrigation districts and the University and Community College System of Nevada.

    10.  “Volunteer fire department” means a volunteer fire department which pays premiums for industrial insurance pursuant to the provisions of chapters 616A to 616D, inclusive, or chapter 617 of NRS.

    Sec. 7.  NRS 319.080, 319.150, 319.160, 319.165, 319.175 and 319.180 are hereby repealed.

    Sec. 8.  This act becomes effective on July 1, 2001, and expires by limitation on July 1, 2003.

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CHAPTER 419, SB 569

Senate Bill No. 569–Senator Amodei

 

CHAPTER 419

 

AN ACT relating to telephone systems; providing for the imposition of surcharges on telephone services by certain counties for the enhancement of telephone systems for reporting emergencies in those counties; providing for the deposit of certain fees imposed by cities and counties on providers of personal wireless service into a special revenue fund; revising the purposes for which money in the special revenue fund may be used; prohibiting the governing body of every incorporated city from imposing certain requirements upon a provider of telecommunications service; and providing other matters properly relating thereto.

 

[Approved: June 5, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 244A of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  If the board of county commissioners of a county whose population is less than 100,000 imposes a surcharge pursuant to NRS 244A.7643 and:


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ê2001 Statutes of Nevada, Page 2124 (Chapter 419, SB 569)ê

 

    (a) The board also imposes a fee on a provider of personal wireless service and the fee is a fee for a business license which is regulated pursuant to NRS 354.59881 to 354.59889, inclusive, the county treasurer shall, except as otherwise provided in this section, deposit the money generated from that fee, including any penalty and interest assessed pursuant to NRS 354.59887, into the special revenue fund.

    (b) A city located within the county imposes a fee on a provider of personal wireless service and the fee is a fee for a business license which is regulated pursuant to NRS 354.59881 to 354.59889, inclusive, the governing body of the city shall transfer the money generated from that fee, including any penalty and interest assessed pursuant to NRS 354.59887, to the county treasurer for deposit into the special revenue fund.

    2.  A county treasurer shall not deposit any money into the special revenue fund pursuant to this section if the deposit of the money would cause the unencumbered balance in the special revenue fund to exceed the maximum allowable balance for the special revenue fund set forth in NRS 244A.7645.

    3.  If the governing body of a city transfers to the county treasurer for deposit into the special revenue fund pursuant to this section money generated from fees for business licenses which fees are regulated by NRS 354.59881 to 354.59889, inclusive, and the deposit of that money into the special revenue fund would cause the unencumbered balance of the special revenue fund to exceed the maximum allowable balance for the special revenue fund set forth in NRS 244A.7645, the county treasurer shall refund to the governing body of the city that amount of such money which, if so deposited, would cause the unencumbered balance of the special revenue fund to exceed its maximum allowable balance.

    4.  As used in this section:

    (a) “Personal wireless service” has the meaning ascribed to it in NRS 354.598816.

    (b) “Special revenue fund” means the special revenue fund created pursuant to NRS 244A.7645.

    Sec. 2.  NRS 244A.7641 is hereby amended to read as follows:

    244A.7641  As used in NRS 244A.7641 to 244A.7647, inclusive, and section 1 of this act, unless the context otherwise requires:

    1.  “Mobile telephone service” means cellular or other service to a telephone installed in a vehicle or which is otherwise portable.

    2.  “Supplier” means a person authorized by the Federal Communications Commission to provide mobile telephone service.

    Sec. 3.  NRS 244A.7643 is hereby amended to read as follows:

    244A.7643  1.  [The] Except as otherwise provided in this section, the board of county commissioners in a county whose population is 20,000 or more [than 100,000] but less than 400,000 may, by ordinance, impose a surcharge on:

    (a) Each access line or trunk line of each customer to the local exchange of any telephone company providing those lines in the county; and

    (b) The mobile telephone service provided to each customer of that service [who resides] whose place of primary use is in the county,

for the enhancement of the telephone system for reporting an emergency in the county.


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ê2001 Statutes of Nevada, Page 2125 (Chapter 419, SB 569)ê

 

    2.  The board of county commissioners of a county whose population is less than 100,000 may not impose a surcharge pursuant to this section unless the board first adopts a 5-year master plan for the enhancement of the telephone system for reporting emergencies in the county. The master plan must include an estimate of the cost of the enhancement of the telephone system and all proposed sources of money for funding the enhancement.

    3.  The surcharge imposed by a board of county commissioners pursuant to [subsection 1:] this section:

    (a) For each access line to the local exchange of a telephone company, must not exceed 25 cents each month;

    (b) For each trunk line to the local exchange of a telephone company, must equal 10 times the amount of the surcharge imposed for each access line to the local exchange of a telephone company pursuant to paragraph (a); and

    (c) For each telephone number assigned to a customer by a supplier of mobile telephone service, must equal the amount of the surcharge imposed for each access line to the local exchange of a telephone company pursuant to paragraph (a).

    [3.] 4.  A telephone company which provides access lines or trunk lines in a county which imposes a surcharge pursuant to this section or a supplier which provides mobile telephone service to a customer in such a county, shall collect the surcharge from its customers each month. Except as otherwise provided in NRS 244A.7647, the telephone company or supplier shall remit the surcharge it collects to the treasurer of the county [where] in which the surcharge is imposed not later than the 15th day of the month after the month it receives payment of the surcharge from its customers.

    [4.] 5.  An ordinance adopted pursuant to subsection 1 may include a schedule of penalties for the delinquent payment of amounts due from telephone companies or suppliers pursuant to this section. Such a schedule:

    (a) Must provide for a grace period of not less than 90 days after the date on which the telephone company or supplier must otherwise remit the surcharge to the county treasurer; and

    (b) Must not provide for a penalty that exceeds 5 percent of the cumulative amount of surcharges owed by a telephone company or a supplier.

    [5.] 6.  As used in this section, “trunk line” means a line which provides a channel between a switchboard owned by a customer of a telephone company and the local exchange of the telephone company.

    Sec. 4.  NRS 244A.7645 is hereby amended to read as follows:

    244A.7645  If a surcharge is imposed in a county pursuant to NRS 244A.7643, the board of county commissioners of that county shall:

    1.  Establish, by ordinance, an advisory committee to develop a plan to enhance the telephone system for reporting an emergency in that county and to oversee any money allocated for that purpose. The advisory committee must consist of not less than five members who:

    (a) Are residents of the county;

    (b) Possess knowledge concerning telephone systems for reporting emergencies; and

    (c) Are not elected public officers.

If the county in which the surcharge is being imposed pursuant to NRS 244A.7643 has a population of less than 100,000, the advisory committee must include a representative of an incumbent local exchange carrier which provides service to persons in that county.


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ê2001 Statutes of Nevada, Page 2126 (Chapter 419, SB 569)ê

 

must include a representative of an incumbent local exchange carrier which provides service to persons in that county. As used in this subsection, “incumbent local exchange carrier” has the meaning ascribed to it in 47 U.S.C. § 251(h)(1), as that section existed on October 1, 1999, and includes a local exchange carrier that is treated as an incumbent local exchange carrier pursuant to that section.

    2.  Create a special revenue fund of the county for the deposit of the money collected pursuant to NRS 244A.7643. The money in the fund must be used only to [:

    (a) Enhance] enhance the telephone system for reporting an emergency so that the number and address from which a call received by the system is made may be determined [; and

    (b) Make any other improvements to the services provided by the telephone system for reporting an emergency.] , including only:

    (a) Paying recurring and nonrecurring charges for telecommunication services necessary for the operation of the enhanced telephone system;

    (b) Paying costs for personnel and training associated with the routine maintenance and updating of the database for the system;

    (c) Purchasing, leasing or renting the equipment and software necessary to operate the enhanced telephone system; and

    (d) Paying costs associated with any maintenance, upgrade and replacement of equipment and software necessary for the operation of the enhanced telephone system.

    3.  If the balance in the fund created pursuant to subsection 2 which has not been committed for expenditure exceeds $500,000 at the end of any fiscal year, reduce the amount of the surcharge imposed during the next fiscal year by the amount necessary to ensure that the unencumbered balance in the fund at the end of the next fiscal year does not exceed $500,000.

    Sec. 5.  NRS 268.088 is hereby amended to read as follows:

    268.088  The governing body of an incorporated city [whose population is 25,000 or more] shall not:

      1.  Impose any terms or conditions on a franchise for the provision of telecommunications service or interactive computer service other than terms or conditions concerning the placement and location of the telephone or telegraph lines and fees imposed for a business license or the franchise, right or privilege to construct, install or operate such lines.

      2.  Require a company that provides telecommunications service or interactive computer service to obtain a franchise if it provides telecommunications service over the telephone or telegraph lines owned by another company.

      3.  Require a person who holds a franchise for the provision of telecommunications service to place its facilities in ducts or conduits or on poles owned or leased by the city.

      4.  As used in this section:

      (a) “Interactive computer service” has the meaning ascribed to it in 47 U.S.C. § 230(e)(2), as that section existed on July 16, 1997.

    (b) “Telecommunications service” has the meaning ascribed to it in 47 U.S.C. § 153(46), as that section existed on July 16, 1997.

    Sec. 6.  This act becomes effective on July 1, 2001.

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ê2001 Statutes of Nevada, Page 2127ê

 

CHAPTER 420, AB 581

Assembly Bill No. 581–Committee on Judiciary

 

CHAPTER 420

 

AN ACT relating to orders; making various changes concerning orders for protection against domestic violence; providing that certain orders for protection issued in another state are not subject to certain requirements to be given full faith and credit in this state; and providing other matters properly relating thereto.

 

[Approved: June 5, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 33 of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  Except as otherwise provided in subsection 2, an order for protection against domestic violence issued by the court of another state, territory or Indian tribe within the United States, including, without limitation, any provisions in the order related to custody and support, is valid and must be accorded full faith and credit and enforced by the courts of this state as if it were issued by a court in this state, regardless of whether the order has been registered in this state, if the court in this state determines that:

    (a) The issuing court had jurisdiction over the parties and the subject matter under the laws of the state, territory or Indian tribe in which the order was issued; and

    (b) The adverse party was given reasonable notice and an opportunity to be heard before the order was issued or, in the case of an ex parte order, the adverse party was given reasonable notice and an opportunity to be heard within the time required by the laws of the issuing state, territory or tribe and, in any event, within a reasonable time after the order was issued.

    2.  If the order for protection against domestic violence issued by the court of another state, territory or Indian tribe is a mutual order for protection against domestic violence and:

    (a) No counter or cross-petition or other pleading was filed by the adverse party; or

    (b) A counter or cross-petition or other pleading was filed and the court did not make a specific finding of domestic violence by both parties,

the court shall refuse to enforce the order against the applicant and may determine whether to issue its own temporary or extended order.

    3.  A law enforcement officer shall enforce an order for protection against domestic violence issued by the court of another state, territory or Indian tribe and shall make an arrest for a violation thereof in the same manner that a law enforcement officer would make an arrest for a violation of a temporary or extended order issued by a court of this state unless it is apparent to the officer that the order is not authentic on its face. An officer shall determine that an order is authentic on its face if the order contains:

    (a) The names of the parties;

    (b) Information indicating that the order has not expired; and


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ê2001 Statutes of Nevada, Page 2128 (Chapter 420, AB 581)ê

 

    (c) Information indicating that the court which issued the order had legal authority to issue the order as evidenced by a certified copy of the order, a file-stamped copy of the order, an authorized signature or stamp of the court which issued the order or another indication of the authority of the court which issued the order.

An officer may determine that any other order is authentic on its face.

    4.  In enforcing an order for protection against domestic violence issued by the court of another state, territory or Indian tribe or arresting a person for a violation of such an order, a law enforcement officer may rely upon:

    (a) A copy of an order for protection against domestic violence that has been provided to the officer;

    (b) An order for protection against domestic violence that is included in the repository for information concerning orders for protection against domestic violence pursuant to NRS 33.095 or in any national crime information database;

    (c) Oral or written confirmation from a law enforcement agency or court in the jurisdiction in which the order for protection against domestic violence was issued that the order is valid and effective; or

    (d) An examination of the totality of the circumstances concerning the existence of a valid and effective order for protection against domestic violence, including, without limitation, the statement of a person protected by the order that the order remains in effect.

    5.  The fact that an order has not been registered or included in the repository for information concerning orders for protection against domestic violence pursuant to NRS 33.095 or in any national crime information database is not grounds for a law enforcement officer to refuse to enforce the terms of the order unless it is apparent to the officer that the order is not authentic on its face.

    6.  A court or law enforcement officer who enforces an order for protection against domestic violence issued by the court of another state, territory or Indian tribe based upon a reasonable belief that the order is valid or who refuses to enforce such an order based upon a reasonable belief that the order is not valid and the employer of such a law enforcement officer are immune from civil and criminal liability for any action taken or not taken based on that belief.

    Sec. 2.  NRS 33.017 is hereby amended to read as follows:

    33.017  As used in NRS 33.017 to 33.100, inclusive, and section 1 of this act, unless the context otherwise requires:

    1.  “Extended order” means an extended order for protection against domestic violence.

    2.  “Temporary order” means a temporary order for protection against domestic violence.

    Sec. 3.  NRS 33.050 is hereby amended to read as follows:

    33.050  1.  The payment of all costs and official fees must be deferred for any applicant for a temporary or extended order. After any hearing and no later than final disposition of the application or order, the court shall assess the costs and fees against the adverse party, except that the court may reduce them or waive them, as justice may require.

    2.  The clerk of the court shall provide each party, free of cost, with information about the:

    (a) Availability of temporary and extended orders;


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ê2001 Statutes of Nevada, Page 2129 (Chapter 420, AB 581)ê

 

    (b) Procedure for filing an application for an order; and

    (c) Right to proceed without legal counsel.

    3.  The clerk of the court or other person designated by the court shall assist any party in completing and filing the application, affidavit , and any other paper or pleading necessary to initiate or respond to an application for a temporary or extended order. This assistance does not constitute the practice of law, but the clerk shall not render any advice or service that requires the professional judgment of an attorney.

    4.  The clerk of the court shall not charge an applicant for a temporary or extended order for providing the applicant with a certified copy of the temporary or extended order.

    Sec. 4.  NRS 33.060 is hereby amended to read as follows:

    33.060  1.  The court shall transmit, by the end of the next business day after the order is issued, a copy of the temporary or extended order to the appropriate law enforcement agency which has jurisdiction over the residence, school, child care facility or other provider of child care, or place of employment of the applicant or the minor child.

    2.  The court [may] shall order the appropriate law enforcement agency to serve , without charge, the adverse party personally with the temporary order [if it finds that such service is necessary to avoid any act of violence] and to file with or mail to the clerk of the court proof of service by the end of the next business day after service is made. Service of an application for an extended order and the notice of hearing thereon must be served upon the adverse party pursuant to the Nevada Rules of Civil Procedure.

    3.  A law enforcement agency shall enforce a temporary or extended order without regard to the county in which the order was issued.

    4.  The clerk of the court shall issue, without fee, a copy of the temporary or extended order to the applicant and the adverse party.

    Sec. 5.  NRS 33.090 is hereby amended to read as follows:

    33.090  1.  [A valid order for protection against domestic violence issued by a court of another state, territory or Indian tribe within the United States must be accorded full faith and credit by the courts of this state and enforced as if it were issued by a court in this state, regardless of whether the order has been registered in this state.

    2.] A person may [apply to a court of this state to] register an order for protection against domestic violence issued by the court of another state, territory or Indian tribe within the United States by presenting a certified copy of the order to the clerk of the court in a judicial district in which the person believes that enforcement may be necessary.

    [3.  Except as otherwise provided in subsection 5, upon application by the protected party pursuant to subsection 2, a court of competent jurisdiction in this state shall register such an order if:

    (a) The court determines that the issuing court had proper jurisdiction over the parties and the subject matter under the laws of the state, territory or tribe; and

    (b) The court determines that the adverse party was given reasonable notice and an opportunity to be heard before the order was issued or, in the case of an ex parte order, the adverse party was given reasonable notice and an opportunity to be heard as soon as possible after the order was issued.

    4.  An order that is registered has the same effect and must be enforced in like manner as an order for protection against domestic violence issued by a court of this state.


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ê2001 Statutes of Nevada, Page 2130 (Chapter 420, AB 581)ê

 

    5.  If the order for protection against domestic violence issued by the court of another state, territory or Indian tribe was a mutual order for protection against domestic violence and:

    (a) No counter or cross-petition was filed seeking such protection order;

    (b) A counter or cross-petition was filed and the court did not make a specific finding of domestic violence by both parties; or

    (c) The person who is applying to register the order has violated a law of the State of Nevada relating to a different protection order issued against him,

the court may refuse to register and enforce the order and may determine whether to issue its own temporary or extended order.

    6.  A temporary or extended order of another state, territory or Indian tribe presented pursuant to this section which appears authentic on its face must be presumed valid.

    7.  A court, law enforcement officer or any other person who enforces an order for protection against domestic violence based upon a reasonable belief that the order is valid is immune from civil liability for any action taken based on that belief.

    8.] 2.  The clerk of the court shall [maintain] :

    (a) Maintain a record of each order registered pursuant to this section [.

    9.  The clerk shall not charge a fee for an application to register or for registering an order pursuant to this section.

    10.  The clerk shall inform] ;

    (b) Provide the protected party with a certified copy of the order registered pursuant to this section bearing proof of registration with the court;

    (c) Forward, by the end of the next business day, a copy of an order registered pursuant to this section to the appropriate law enforcement agency which has jurisdiction over the residence, school, child care facility or other provider of child care, or place of employment of the protected party or the child of the protected party; and

    (d) Inform the protected party upon the successful transfer of information concerning the registration to the central repository for Nevada records of criminal history as required pursuant to NRS 33.095.

    3.  The clerk of the court shall not:

    (a) Charge a fee for registering an order or for providing a certified copy of an order pursuant to this section.

    (b) Notify the party against whom the order has been made that an order for protection against domestic violence issued by the court of another state, territory or Indian tribe has been registered in this state.

    4.  A person who registers an order pursuant to this section must not be charged to have the order served in this state.

    Sec. 6.  NRS 4.060 is hereby amended to read as follows:

    4.060  1.  Except as otherwise provided in this section [,] and NRS 33.017 to 33.100, inclusive, and section 1 of this act, each justice of the peace shall charge and collect the following fees:

    (a) On the commencement of any action or proceeding in the justice’s court, other than in actions commenced pursuant to chapter 73 of NRS, to be paid by the party commencing the action:


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ê2001 Statutes of Nevada, Page 2131 (Chapter 420, AB 581)ê

 

If the sum claimed does not exceed $1,000................................................................................................... $28.00

If the sum claimed exceeds $1,000 but does not exceed $2,500................................................................. 50.00

If the sum claimed exceeds $2,500 but does not exceed $4,500............................................................... 100.00

If the sum claimed exceeds $4,500 but does not exceed $6,500............................................................... 125.00

If the sum claimed exceeds $6,500 but does not exceed $7,500............................................................... 150.00

In all other civil actions......................................................................................................................................... 28.00

    (b) For the preparation and filing of an affidavit and order in an action commenced pursuant to chapter 73 of NRS:

If the sum claimed does not exceed $1,000..................................................................................................... 25.00

If the sum claimed exceeds $1,000 but does not exceed $2,500................................................................. 45.00

If the sum claimed exceeds $2,500 but does not exceed $5,000................................................................. 65.00

    (c) On the appearance of any defendant, or any number of defendants answering jointly, to be paid him or them on filing the first paper in the action, or at the time of appearance:

In all civil actions................................................................................................................................................... 12.00

For every additional defendant, appearing separately..................................................................................... 6.00

    (d) No fee may be charged where a defendant or defendants appear in response to an affidavit and order issued pursuant to the provisions of chapter 73 of NRS.

    (e) For the filing of any paper in intervention................................................................................................. 6.00

    (f) For the issuance of any writ of attachment, writ of garnishment, writ of execution or any other writ designed to enforce any judgment of the court.................................................................................................. 6.00

    (g) For filing a notice of appeal, and appeal bonds..................................................................................... 12.00

One charge only may be made if both papers are filed at the same time.

    (h) For issuing supersedeas to a writ designed to enforce a judgment or order of the court.. 12.00

    (i) For preparation and transmittal of transcript and papers on appeal.................................................. 12.00

    (j) For celebrating a marriage and returning the certificate to the county recorder............................... 35.00

    (k) For entering judgment by confession......................................................................................................... 6.00

    (l) For preparing any copy of any record, proceeding or paper, for each page........................................... .30

    (m) For each certificate of the clerk, under the seal of the court................................................................ 3.00

    (n) For searching records or files in his office, for each year........................................................................ 1.00

    (o) For filing and acting upon each bail or property bond ........................................................................ 40.00

    2.  A justice of the peace shall not charge or collect any of the fees set forth in subsection 1 for any service rendered by him to the county in which his township is located.

    3.  A justice of the peace shall not charge or collect the fee pursuant to paragraph (j) of subsection 1 if he performs a marriage ceremony in a commissioner township.


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ê2001 Statutes of Nevada, Page 2132 (Chapter 420, AB 581)ê

 

    4.  Except as otherwise provided by an ordinance adopted pursuant to the provisions of NRS 244.207, the justice of the peace shall, on or before the fifth day of each month, account for and pay to the county treasurer all fees collected during the preceding month, except for the fees he may retain as compensation and the fees he is required to pay to the state treasurer pursuant to subsection 5.

    5.  The justice of the peace shall, on or before the fifth day of each month, pay to the state treasurer [half] one-half of the fees collected pursuant to paragraph (o) of subsection 1 during the preceding month. The state treasurer shall deposit the money in the fund for the compensation of victims of crime.

    Sec. 7.  NRS 17.340 is hereby amended to read as follows:

    17.340  As used in NRS 17.330 to 17.400, inclusive, unless the context otherwise requires, “foreign judgment” means any judgment of a court of the United States or of any other court which is entitled to full faith and credit in this state, except [a] :

    1.  A judgment to which chapter 130 of NRS applies [.] ; and

    2.  An order for protection issued for the purpose of preventing violent or threatening acts or harassment against, or contact or communication with or physical proximity to, another person, including temporary and final orders.

    Sec. 8.  This act becomes effective on July 1, 2001.

________

 

CHAPTER 421, SB 219

Senate Bill No. 219–Committee on Transportation

 

CHAPTER 421

 

AN ACT relating to property; revising the manner in which the department of transportation is required to dispose of certain property; and providing other matters properly relating thereto.

 

[Approved: June 5, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 408.533 is hereby amended to read as follows:

    408.533  1.  All real property, interests therein or improvements thereon and personal property acquired before, on or after April 1, 1957, in accordance with the provisions of NRS 408.487 and 408.489 must, after approval by the board and if no longer needed for highway purposes, be disposed of by the director in accordance with the provisions of subsection 2, except that:

    (a) When the property was originally donated to the state, no charge may be made if it is returned to the original owner or to the holder of the reversionary right.

    (b) When the property has been wholly or partially paid for by towns, cities or counties, disposal of the property and of money received therefor must be agreed upon by the governing bodies of the towns, cities and counties and the department.


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ê2001 Statutes of Nevada, Page 2133 (Chapter 421, SB 219)ê

 

    (c) When the title to the real property has been acquired in fee pursuant to NRS 408.487 and 408.489 and, in the opinion of the board, a sale by means of a public auction or sealed bids is uneconomical or impractical because:

         (1) There is no access to the property;

         (2) The property has value or an increased value only to a single adjoining property owner; or

         (3) Such a sale would work an undue hardship upon a property owner as a result of a severance of the property of that owner or a denial of access to a public highway,

the board may enter into a direct sale of the property with such an owner or any other person for its fair market value.

    (d) When the property has been acquired and [:

         (1) The proposed purpose for which it was acquired is later abandoned by the department; or

         (2) Part] the property or any portion of the property is no longer needed for highway purposes , [and] the department [determines that the property was acquired for less than its fair market value,

the department] shall give notice of its intention to dispose of the property by publication in a newspaper of general circulation in the county where the property is situated. The notice must include the department’s appraisal of the fair market value of the property. Any person from whom the property was purchased or his heir or grantee may purchase the property at its fair market value by direct sale from the department within 60 days after the notice is published. If more than one person qualified to purchase the property by direct sale pursuant to this paragraph so requests, the person with the superior claim, as determined by the department in its sole discretion, is entitled to purchase the property by direct sale. If [no] a person who is entitled to purchase the property by direct sale pursuant to this paragraph reasonably believes that the department’s appraisal of the property is greater than the fair market value of the property, the person may file an objection to the appraisal with the department. The department shall set forth the procedure for filing an objection and the process under which a final determination will be made of the fair market value of the property for which an objection is filed. The department shall sell the property in the manner provided in subsection 2 if:

         (1) No person requests to purchase the property by direct sale within 60 days after the notice is published pursuant to this paragraph [, the department shall sell the property in the manner provided in subsection 2.]; or

         (2) A person who files an objection pursuant to this paragraph fails, within 10 business days after he receives a written notice of the final determination of the fair market value of the property, to notify the department in writing that he wishes to purchase the property at the fair market value set forth in the notice.

    (e) When the property is sought by another public agency for a reasonable public use, the department may first offer the property to the public agency at its fair market value.

    2.  All property, interests or improvements not [falling] included within the provisions of subsection 1 must first be offered for sale by the department singly or in combination at public auction or by sealed bids. If the highest bid received is 90 percent or more of the department’s appraisal of the fair market value of the property, the property may be sold to the highest bidder. The notice and the terms of the sale must be published in a newspaper of general circulation in the county where the property is situated.


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ê2001 Statutes of Nevada, Page 2134 (Chapter 421, SB 219)ê

 

general circulation in the county where the property is situated. [Those] The auctions and openings of bids must be conducted by the department. If the property cannot be sold for 90 percent or more of its fair market value, the department may enter into a written listing agreement with a person licensed pursuant to chapter 645 of NRS to sell or lease the property for 90 percent or more of its fair market value.

    3.  It is conclusively presumed in favor of the department and any purchaser for value that the department acted within its lawful authority in acquiring and disposing of the property, and that the director acted within his lawful authority in executing any conveyance vesting title in the purchaser. All such conveyances must be quitclaim in nature and the department shall not warrant title, furnish title insurance or pay the tax on transfer of real property.

    4.  No person has a right of action against the department or its employees for a violation of this section. This subsection does not prevent an action by the attorney general on behalf of the State of Nevada or any aggrieved person.

    5.  All sums of money received by the department for the sale of real and personal property must be deposited with the state treasurer to be credited to the state highway fund, unless the Federal Highway Administration participated in acquisition of the property, in which case a pro rata share of the money obtained by disposal of the property must be paid to the Federal Highway Administration.

    6.  The department may reserve and except easements, rights or interests from the conveyance of any real property disposed of in accordance with this section or exchanged pursuant to subsection 5 of NRS 408.489. [Those] The easements, rights or interests include, but are not limited to:

    (a) Abutter’s rights of light, view or air.

    (b) Easements of access to and from abutting land.

    (c) Covenants prohibiting the use of signs, structures or devices advertising activities not conducted, services not rendered or goods not produced or available on the real property.

    Sec. 2.  The amendatory provisions of section 1 of this act do not apply to any property for which the department of transportation publishes a notice of its intention to dispose of the property pursuant to NRS 408.533 before the effective date of this act.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2135ê

 

CHAPTER 422, SB 527

Senate Bill No. 527–Committee on Taxation

 

CHAPTER 422

 

AN ACT relating to cigarettes; exempting duty-free sales enterprises and persons importing cigarettes for personal use from provisions governing the licensing of cigarette dealers and the taxation of cigarettes; providing that cigarette revenue stamps must identify the dealer who affixed the stamps; requiring certain dealers to file certificates regarding cigarettes imported into the United States; expanding the scope of prohibited acts by cigarette dealers; revising the provisions governing the disposal of certain contraband cigarettes; providing for a private right of action for injunctive relief regarding certain violations of chapter 370 of NRS; providing a penalty; and providing other matters properly relating thereto.

 

[Approved: June 5, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 370 of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  Except as otherwise provided in subsection 2, a person may institute a civil action in a court of competent jurisdiction for appropriate injunctive relief if the person:

    (a) Sells, distributes or manufactures cigarettes; and

    (b) Sustains direct economic or commercial injury as a result of a violation of subsection 4 of NRS 370.240 or NRS 370.385.

    2.  Nothing in this section authorizes an action against this state, a political subdivision of this state, or an officer, employee or agency thereof.

    Sec. 2.  NRS 370.070 is hereby amended to read as follows:

    370.070  The provisions of NRS 370.001 to 370.430, inclusive, do not apply to [common] :

    1.  Common carriers while engaged in interstate commerce which sell or furnish cigarettes on their trains, buses or airplanes [.] ;

    2.  A person entering this state with a quantity of cigarettes for household or personal use which is exempt from federal import duty; and

    3.  A duty-free sales enterprise as defined in 19 U.S.C. § 1555(b)(8)(D) that:

    (a) Operates pursuant to the provisions of 19 U.S.C. § 1555(b); and

    (b) To the extent it sells cigarettes, only sells cigarettes that are duty-free merchandise as defined in 19 U.S.C. § 1555(b)(8)(E).

    Sec. 3.  NRS 370.180 is hereby amended to read as follows:

    370.180  1.  The department shall:

    (a) Design [a suitable stamp or] suitable stamps for the purpose of this chapter [.] which meet the requirements of this section; and

    (b) From time to time, have as many revenue stamps printed as may be required.

    2.  Each stamp must be designed to permit the identification of the dealer who affixed the stamp to a package or other container of cigarettes. The dealer must be identified by a number or other mark on the stamp. The department shall maintain, for not less than 3 years after the date the stamp is provided to the dealer, a record of the information necessary to identify the dealer by examining the stamp. Upon request, the department shall provide to any person the information maintained pursuant to this subsection.


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ê2001 Statutes of Nevada, Page 2136 (Chapter 422, SB 527)ê

 

shall provide to any person the information maintained pursuant to this subsection.

    3.  The use of a metered stamping machine approved by and registered with the department shall be subject to such regulations as prescribed by the department.

    Sec. 4.  NRS 370.240 is hereby amended to read as follows:

    370.240  1.  Each dealer authorized to purchase or affix cigarette revenue stamps shall report to the department:

    (a) The inventory of all cigarettes in his possession or control at the close of business on the last day of each month.

    (b) The total value of all cigarette revenue stamps affixed by him upon cigarette packages sold in or shipped into the state by him during the preceding month.

    2.  The report must be made by the 25th day of the month following shipments upon forms to be provided by the department.

    3.  The dealer may be allowed 5 additional days to file his report, if he makes prior written application to the department and the department finds good cause for extension.

    4.  If, during the preceding month, the dealer affixed cigarette revenue stamps upon cigarette packages imported into the United States, he shall file with the report a copy of each certificate submitted pursuant to 19 U.S.C. § 1681a(c) with regard to the cigarette packages.

    Sec. 5.  NRS 370.385 is hereby amended to read as follows:

    370.385  1.  A wholesale or retail dealer shall not affix a Nevada cigarette revenue stamp or a metered machine impression upon a package, carton, packet or other container of cigarettes which:

    (a) Does not meet the requirements of the Federal Cigarette Labeling and Advertising Act, 15 U.S.C. §§ 1331 et seq., for the placement of labels, warnings or any other information required by that Act to be placed upon a container of cigarettes sold within the United States;

    (b) Is labeled as “for export only,” “U.S. tax exempt,” “for use outside the U.S.” or with similar wording indicating that the manufacturer did not intend for the product to be sold in the United States;

    (c) Has been altered by the unauthorized addition or removal of wording, labels or warnings described in paragraph (a) or (b);

    (d) Has been exported from the United States after January 1, 2000, and imported into the United States in violation of 26 U.S.C. § 5754; [or]

    (e) Has been imported into the United States in violation of 19 U.S.C. § 1681a;

    (f) Was manufactured, packaged or imported by a person who has not complied with 15 U.S.C. § 1335a with regard to the cigarettes;

    (g) Violates a federal trade-mark or copyright law [.] ; or

    (h) Violates any other federal statute or regulation or with respect to which any federal statute or regulation has been violated.

    2.  A wholesale or retail dealer shall not:

    (a) Affix Nevada cigarette revenue stamps or metered machine impressions on;

    (b) Sell or distribute in this state; or

    (c) Possess in this state with the intent to sell or distribute in this state,

cigarettes manufactured for export outside the United States.


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ê2001 Statutes of Nevada, Page 2137 (Chapter 422, SB 527)ê

 

    3.  The department may impose a penalty on a wholesale or retail dealer who violates subsection 1 or 2 as follows:

    (a) For the first violation, a penalty of $5,000.

    (b) For each subsequent violation, a penalty of $10,000.

    4.  Notwithstanding any other provision of law, the department [may seize, destroy or sell to the manufacturer, for export only, a container of] shall seize and destroy cigarettes upon which a revenue stamp or metered machine impression was placed in violation of subsection 1 or 2.

    5.  As used in this section, “cigarettes manufactured for export outside the United States” means cigarettes contained in a package or carton which indicates that the cigarettes are tax exempt and for use outside the United States.

    Sec. 6.  NRS 370.415 is hereby amended to read as follows:

370.415  1.  The department, its agents, sheriffs within their respective counties and all other peace officers of the State of Nevada shall seize any contraband cigarettes found or located in the State of Nevada.

    2.  A sheriff or other peace officer who seizes cigarettes pursuant to this section shall provide written notification of the seizure to the department not later than 5 working days after the seizure. The notification must include the reason for the seizure.

    3.  After consultation with the department, the sheriff or other peace officer shall transmit the cigarettes to the department if:

    (a) The cigarettes, except for revenue stamps or metered machine impressions being properly affixed as required by this chapter, comply with all state and federal statutes and regulations; and

    (b) The department approves the transmission of the cigarettes.

    4.  Upon receipt of the cigarettes, the department shall dispose of the cigarettes as provided in subsection 4 of NRS 370.270.

    5.  If the sheriff or other peace officer does not transmit the cigarettes to the department, he shall destroy the cigarettes.

    Sec. 7.  The amendatory provisions of this act do not apply to offenses committed before July 1, 2001.

    Sec. 8.  This act becomes effective on July 1, 2001.

________

 

CHAPTER 423, AB 187

Assembly Bill No. 187–Committee on Ways and Means

 

CHAPTER 423

 

AN ACT making an appropriation to the legislative fund for additional equipment and software for information systems for the Legislative Counsel Bureau and the Nevada Legislature; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the legislative fund created by NRS 218.085 the sum of $700,000 for additional equipment and software for information systems for the Legislative Counsel Bureau and the Nevada Legislature.


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2138 (Chapter 423, AB 187)ê

 

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 424, AB 189

Assembly Bill No. 189–Committee on Ways and Means

 

CHAPTER 424

 

AN ACT making an appropriation to the legislative fund for certain maintenance and rehabilitation projects on the legislative building; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the legislative fund created by NRS 218.085 the sum of $715,700 for the following maintenance and rehabilitation projects on the legislative building:

    1.  Rebuilding the west entry to the legislative building to remove the roof over the first floor and enclose the entry;

    2.  Maintaining and repairing the exterior surface of the legislative building;

    3.  Replacing the heating, ventilation and air-conditioning system in the Sedway Office Building; and

    4.  Resurfacing the floor of the main level of the parking garage.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after the projects are completed and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2139ê

 

CHAPTER 425, AB 285

Assembly Bill No. 285–Assemblymen Parnell, Bache, Smith, Gibbons, Koivisto, McClain, Oceguera and Parks

 

CHAPTER 425

 

AN ACT relating to the state personnel system; creating the committee on catastrophic leave to hear appeals from decisions of appointing authorities regarding the use of such leave; prescribing the powers and duties of the committee; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 284 of NRS is hereby amended by adding thereto the provisions set forth as sections 2, 3 and 4 of this act.

    Sec. 2.  1.  There is hereby created within the department the committee on catastrophic leave composed of five members appointed by the governor.

    2.  The committee must be composed of:

    (a) Three members who are executive officers of state agencies; and

    (b) Two members who are representatives of labor.

    3.  The members of the committee serve at the pleasure of the governor.

    4.  After the initial terms, each member of the committee serves for a term of 3 years. Each member of the committee continues in office until his successor is appointed. Any member of the committee may be reappointed.

    5.  A vacancy in the membership of the committee must be filled in the same manner as the original appointment for the remainder of the unexpired term.

    6.  The members of the committee serve without compensation, except that the members are entitled to receive the per diem allowance and travel expenses provided for state officers and employees generally while engaged in the official business of the committee.

    Sec. 3.  1.  The members of the committee shall elect a chairman and vice chairman from among their members. After the initial election, the chairman and vice chairman serve in the office for a term of 1 year beginning on July 1 of each year. If a vacancy occurs in the chairmanship or vice chairmanship, the members of the committee shall elect a chairman or vice chairman from among their members to serve for the remainder of the unexpired term.

    2.  Any three members of the committee constitute a quorum, and a majority vote of the quorum is required to take action with respect to any matter.

    3.  The committee shall adopt:

    (a) Rules for its own management; and

    (b) Such rules of practice and procedure as are necessary to carry out its duties.

    4.  The committee shall hold such hearings as are necessary to carry out the provisions of section 4 of this act.

    5.  The director or his designee shall act as the nonvoting recording secretary of the committee.


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ê2001 Statutes of Nevada, Page 2140 (Chapter 425, AB 285)ê

 

    Sec. 4.  1.  An employee aggrieved by any decision of an appointing authority made pursuant to NRS 284.362 to 284.3626, inclusive, may appeal from the decision by filing a written notice of appeal with the committee within 10 days after the date of the decision.

    2.  The committee shall:

    (a) Within 5 days after receiving a notice of appeal, schedule a hearing on the merits of the appeal for a date not later than 20 days after its receipt of the notice.

    (b) Cause notice of the date and time of the hearing to be given to the employee and the appointing authority by mail or by personal service.

    (c) Conduct the hearing expeditiously and informally. Technical rules of evidence do not apply at the hearing.

    3.  The employee may file a written request with the committee to give preference in scheduling the hearing. The request must set forth facts showing that the seriousness of the alleged catastrophe requires an expedited appeal.

    4.  The employee may represent himself at the hearing or be represented by an attorney or other person of the employee’s own choosing.

    5.  The committee shall:

    (a) Render a decision in writing within 10 days after the hearing, setting forth the reasons therefor.

    (b) Cause notice of the decision to be given to the employee and the appointing authority by mail or by personal service.

    6.  The decision of the committee is final and is not subject to judicial review or the procedure for the adjustment of grievances pursuant to NRS 284.384.

    7.  A meeting or hearing held by the committee to carry out the provisions of this section and the committee’s deliberations on the information or evidence received are not subject to any provision of chapter 241 of NRS.

    Sec. 5.  NRS 284.362 is hereby amended to read as follows:

    284.362  1.  As used in NRS 284.362 to 284.3626, inclusive, [“catastrophe” means:

    1.] and sections 2, 3 and 4 of this act:

    (a) “Catastrophe” means:

         (1) The employee is unable to perform the duties of his position because of a serious illness or accident which is life threatening or which will require a lengthy convalescence;

    [2.] (2) There is a serious illness or accident which is life threatening or which will require a lengthy convalescence in the employee’s immediate family; or

    [3.] (3) There is a death in the employee’s immediate family.

    (b) “Committee” means the committee on catastrophic leave created pursuant to section 2 of this act.

    2.  The commission shall adopt regulations further defining “catastrophe” to ensure that the term is limited to serious calamities.

    Sec. 6.  NRS 284.3623 is hereby amended to read as follows:

    284.3623  [1.]  The appointing authority may approve the transfer of a specified number of hours of leave from the account for catastrophic leave to the account of any employee who the appointing authority determines is eligible to receive such leave.


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ê2001 Statutes of Nevada, Page 2141 (Chapter 425, AB 285)ê

 

    [2.  The decision of the appointing authority concerning the approval of leave pursuant to subsection 1 is final and is not subject to judicial review or the procedure for the adjustment of grievances pursuant to NRS 284.384.]

    Sec. 7.  As soon as practicable after July 1, 2001, the governor shall appoint to the committee on catastrophic leave created pursuant to section 2 of this act:

    1.  One member who is an executive officer of a state agency and one member who is a representative of labor whose terms expire on July 1, 2002.

    2.  One member who is an executive officer of a state agency and one member who is a representative of labor whose terms expire on July 1, 2003.

    3.  One member who is an executive officer of a state agency whose term expires on July 1, 2004.

    Sec. 8.  This act becomes effective on July 1, 2001.

________

 

CHAPTER 426, AB 454

Assembly Bill No. 454–Assemblymen Arberry, Giunchigliani, Collins, Anderson, Berman, Buckley, Dini, Goldwater, Manendo, Mortenson, Neighbors, Price and Tiffany

 

CHAPTER 426

 

AN ACT relating to the University and Community College System of Nevada; requiring the Board of Regents of the University of Nevada to appoint a committee to study the organizational structure of certain community colleges; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  1.  The Board of Regents of the University of Nevada shall appoint a committee to conduct a study of the organizational structure of any community college within the University and Community College System of Nevada that has an enrollment of more than 20,000 students.

    2.  The committee appointed pursuant to subsection 1 must consist of members of the Board of Regents, members of each community in which the campus of each such community college is located, and any other persons deemed appropriate for membership by the Board of Regents.

    3.  The committee shall:

    (a) Review the administrative structure of each such community college; and

    (b) Determine whether the administrative structure allows each campus of the community college to operate at maximum effectiveness and whether the needs of each campus for executive leadership are being met.

    4.  The Board of Regents shall, not later than January 1, 2003, submit a report of the findings of the committee, including any recommended legislation, to the Director of the Legislative Counsel Bureau for transmittal to the 72nd session of the Nevada Legislature.

    Sec. 2.  This act becomes effective on July 1, 2001.

________

 


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ê2001 Statutes of Nevada, Page 2142ê

 

CHAPTER 427, AB 507

Assembly Bill No. 507–Committee on Ways and Means

 

CHAPTER 427

 

AN ACT making an appropriation to the State Department of Conservation and Natural Resources for a radio connection between the Nevada State Park System and the Department of Motor Vehicles and Public Safety; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the State Department of Conservation and Natural Resources the sum of $193,323 for a radio connection between the Nevada State Park System and the Department of Motor Vehicles and Public Safety.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 428, AB 517

Assembly Bill No. 517–Committee on Ways and Means

 

CHAPTER 428

 

AN ACT making an appropriation to the Department of Human Resources for furnishings and equipment for the Division of Child and Family Services; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $117,244 for furnishings and equipment for the Division of Child and Family Services.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2143ê

 

CHAPTER 429, AB 524

Assembly Bill No. 524–Committee on Ways and Means

 

CHAPTER 429

 

AN ACT making an appropriation to the Department of Information Technology for phase IIA of the digital microwave upgrade; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Information Technology the sum of $4,641,986 for phase IIA of the digital microwave upgrade.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 430, AB 527

Assembly Bill No. 527–Committee on Ways and Means

 

CHAPTER 430

 

AN ACT making an appropriation to the Legislative Counsel Bureau for new and replacement equipment and various maintenance projects; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the legislative fund created by NRS 218.085 the sum of $747,823 for new and replacement equipment and various maintenance projects for the Legislative Counsel Bureau.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2144ê

 

CHAPTER 431, AB 529

Assembly Bill No. 529–Committee on Ways and Means

 

CHAPTER 431

 

AN ACT making an appropriation to the Department of Human Resources for software and computer equipment for the Nevada rural health communications system; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $236,490 for software and computer equipment for the Nevada rural health communications system.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 432, AB 531

Assembly Bill No. 531–Committee on Ways and Means

 

CHAPTER 432

 

AN ACT making an appropriation to the Department of Human Resources for a vehicle, furnishings and equipment for the Nevada Youth Training Center within the Division of Child and Family Services; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $73,144 for a vehicle, furnishings and equipment for the Nevada Youth Training Center within the Division of Child and Family Services.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2145ê

 

CHAPTER 433, AB 532

Assembly Bill No. 532–Committee on Ways and Means

 

CHAPTER 433

 

AN ACT making an appropriation to the Department of Human Resources for a vehicle, office equipment and remodeling for the Northern Nevada Child and Adolescent Services; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $72,892 for a vehicle, office equipment and remodeling for the Northern Nevada Child and Adolescent Services.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 434, AB 533

Assembly Bill No. 533–Committee on Ways and Means

 

CHAPTER 434

 

AN ACT making an appropriation to the Department of Business and Industry for the replacement of computers in the Consumer Affairs Division; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Business and Industry the sum of $15,150 for the replacement of computers in the Consumer Affairs Division.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2146ê

 

CHAPTER 435, AB 598

Assembly Bill No. 598–Committee on Ways and Means

 

CHAPTER 435

 

AN ACT making an appropriation to the Department of Human Resources for an enhanced health clinic for the Jan Evans Juvenile Justice Center; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $250,000 for an enhanced health clinic for the Jan Evans Juvenile Justice Center.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 436, AB 627

Assembly Bill No. 627–Committee on Commerce and Labor

 

CHAPTER 436

 

AN ACT relating to trade practices; authorizing the public utilities commission of Nevada to adopt regulations governing the disclosures that must be made by a provider of a telecommunications service to a customer before the customer is charged for the service; expanding the definition of “deceptive trade practice” to include certain advertising practices relating to goods or services; revising the provisions governing certificates of registration issued to certain registrants by the consumer affairs division; requiring the renewal of those certificates of registration; increasing the amount of the security that certain dance studios and health clubs are required to deposit with the consumer affairs division; requiring certain sellers of travel to register and deposit security with the consumer affairs division; authorizing certain consumers to bring and maintain actions to recover against the security; providing for the release of the security within a certain period after the seller of travel ceases to operate; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  (Deleted by amendment.)

    Sec. 2.  Chapter 598 of NRS is hereby amended by adding thereto the provisions set forth as sections 3 to 13, inclusive, of this act.

    Sec. 3.  As used in sections 3 to 12, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 4 to 8, inclusive, of this act have the meanings ascribed to them in those sections.

    Sec. 4.  “Commissioner” means the commissioner of the consumer affairs division of the department of business and industry.


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ê2001 Statutes of Nevada, Page 2147 (Chapter 436, AB 627)ê

 

    Sec. 5.  “Division” means the consumer affairs division of the department of business and industry.

    Sec. 6.  “Seller of travel” means a person who offers for sale, directly or indirectly, transportation by air, land, rail or water, travel services, vacation certificates or any combination thereof, to a person or group of persons for a fee, commission or other valuable consideration. The term:

    1.  Includes any person who offers membership in a travel club or any services related to travel for an advance fee or payment.

    2.  Does not include:

    (a) A hotel that provides or arranges travel services for its patrons or guests;

    (b) A person who, for compensation, transports persons or property by air, land, rail or water; or

    (c) A tour broker or tour operator who is subject to the provisions of sections 2 to 14, inclusive, of Assembly Bill No. 245 of this session.

    Sec. 7.  “Travel services” includes, without limitation:

    1.  Short-term leases of passenger cars;

    2.  Lodging;

    3.  Transfers;

    4.  Sightseeing tours other than sightseeing tours for which a tour broker or tour operator is regulated pursuant to sections 2 to 14, inclusive, of Assembly Bill No. 245 of this session; and

    5.  Any other services that are related to travel by air, land, rail or water or any other method of transportation.

    Sec. 8.  “Vacation certificate” means any document received by a person for consideration paid in advance which evidences that the holder of the document is entitled to:

    1.  Transportation by air, land, rail or water; or

    2.  The use of lodging or other facilities for a specified period,

during the period for which the certificate is valid.

    Sec. 9.  1.  Before advertising its services or conducting business in this state, a seller of travel must register with the division by:

    (a) Submitting to the division an application for registration on a form prescribed by the division;

    (b) Paying to the division a fee of $25; and

    (c) Depositing the security required pursuant to section 10 of this act, if any, with the division.

    2.  The division shall issue a certificate of registration to the seller of travel upon receipt of:

    (a) The security in the proper form if the seller of travel is required to deposit security pursuant to section 10 of this act; and

    (b) The payment of the fee required by this section.

    3.  A certificate of registration:

    (a) Is not transferable or assignable; and

    (b) Expires 1 year after it is issued.

    4.  A seller of travel must renew a certificate of registration issued pursuant to this section before the certificate expires by:

    (a) Submitting to the division an application for the renewal of the certificate on a form prescribed by the division; and

    (b) Paying to the division a fee of $25.

    Sec. 10.  1.  Except as otherwise provided in subsection 8, each seller of travel shall deposit with the division:


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ê2001 Statutes of Nevada, Page 2148 (Chapter 436, AB 627)ê

 

    (a) A bond executed by a corporate surety approved by the commissioner and licensed to do business in this state;

    (b) An irrevocable letter of credit for which the seller of travel is the obligor, issued by a bank whose deposits are federally insured; or

    (c) A certificate of deposit in a financial institution which is doing business in this state and which is federally insured or insured by a private insurer approved pursuant to NRS 678.755. The certificate of deposit may be withdrawn only on the order of the commissioner, except that the interest may accrue to the seller of travel.

    2.  The term of the bond, letter of credit or certificate of deposit, or any renewal thereof, must be not less than 1 year.

    3.  The amount of the bond, letter of credit or certificate of deposit, or any renewal thereof, must be $50,000.

    4.  If the seller of travel deposits a bond, the seller of travel shall keep accurate records of the bond and the payments made on the premium. The records must be open to inspection by the division during business hours. The seller of travel shall notify the division not later than 30 days before the date of expiration of the bond and provide written proof of the renewal of the bond to the division.

    5.  The commissioner may reject any bond, letter of credit or certificate of deposit that fails to comply with the requirements of this chapter.

    6.  A seller of travel may change the form of security that he has deposited with the division. If the seller of travel changes the form of the security, the commissioner may retain for not more than 1 year any portion of the security previously deposited by the seller of travel as security for claims arising during the time the previous security was in effect.

    7.  If the amount of the deposited security falls below the amount required by this chapter for that security, the seller of travel shall be deemed not to be registered as required by section 9 of this act for the purposes of this chapter.

    8.  The provisions of this section do not apply to a seller of travel who is accredited by and appointed as an agent of the Airlines Reporting Corporation.

    Sec. 11.  1.  The security required to be deposited by a seller of travel pursuant to section 10 of this act must be held in trust for consumers injured as a result of:

    (a) Any act of fraud or misrepresentation by the seller of travel acting in his capacity as a seller of travel;

    (b) The bankruptcy of the seller of travel; or

    (c) The breach of any contract entered into by the seller of travel in his capacity as a seller of travel.

    2.  A consumer so injured may bring and maintain an action in any court of competent jurisdiction to recover against the security.

    3.  The division may bring an action for interpleader against all claimants upon the security. If the division brings such an action, the division shall publish notice of the action at least once each week for 2 weeks in a newspaper of general circulation in the county in which the seller of travel has its principal place of business. The division may deduct its costs of the action, including the costs of the publication of the notice, from the amount of the security. All claims against the security have equal priority. If the security is insufficient to pay all the claims in full, the claims must be paid pro rata.


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ê2001 Statutes of Nevada, Page 2149 (Chapter 436, AB 627)ê

 

claims must be paid pro rata. If the seller of travel has posted a bond with the division, the surety is then relieved of all liability under the bond.

    4.  The division may, in lieu of bringing an action for interpleader pursuant to subsection 3, conduct a hearing to determine the distribution of the security to claimants. The division shall adopt regulations to provide for adequate notice and the conduct of the hearing. If the seller of travel has posted a bond with the division, distribution pursuant to this subsection relieves the surety of all liability under the bond.

    5.  If the security is sufficient to pay all claims against the security in full, the division may deduct from the amount of the security, the cost of any investigation or hearing it conducted to determine the distribution of the security.

    Sec. 12.  1.  If no claims have been filed against the security deposited with the division pursuant to section 10 of this act within 6 months after the seller of travel ceases to operate or his registration expires, whichever occurs later, the commissioner shall release the security to the seller of travel and shall not audit any claims filed against the security thereafter by consumers.

    2.  If one or more claims have been filed against the security within 6 months after the seller of travel ceases to operate or his registration expires, whichever occurs later, the proceeds must not be released to the seller of travel or distributed to any consumer earlier than 1 year after the seller of travel ceases to operate or his registration expires, whichever occurs later.

    3.  For the purposes of this section, the commissioner shall determine the date on which a seller of travel ceases to operate.

    Sec. 13.  The public utilities commission of Nevada may adopt regulations governing the disclosures that must be made by a provider to a customer before the customer may be charged for a telecommunications service.

    Sec. 14.  NRS 598.0915 is hereby amended to read as follows:

    598.0915  A person engages in a “deceptive trade practice” if, in the course of his business or occupation, he:

    1.  Knowingly passes off goods or services for sale or lease as those of another [.] person.

    2.  Knowingly makes a false representation as to the source, sponsorship, approval or certification of goods or services for sale or lease.

    3.  Knowingly makes a false representation as to affiliation, connection, association with or certification by another [.] person.

    4.  Uses deceptive representations or designations of geographic origin in connection with goods or services for sale or lease.

    5.  Knowingly makes a false representation as to the characteristics, ingredients, uses, benefits, alterations or quantities of goods or services for sale or lease or a false representation as to the sponsorship, approval, status, affiliation or connection of a person therewith.

    6.  Represents that goods for sale or lease are original or new if he knows or should know that they are deteriorated, altered, reconditioned, reclaimed, used or secondhand.

    7.  Represents that goods or services for sale or lease are of a particular standard, quality or grade, or that such goods are of a particular style or model, if he knows or should know that they are of another [.] standard, quality, grade, style or model.


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ê2001 Statutes of Nevada, Page 2150 (Chapter 436, AB 627)ê

 

    8.  Disparages the goods, services or business of another person by false or misleading representation of fact.

    9.  Advertises goods or services with intent not to sell or lease them as advertised.

    10.  Advertises goods or services for sale or lease with intent not to supply reasonably expectable public demand, unless the advertisement discloses a limitation of quantity.

    11.  Advertises goods or services as being available free of charge with intent to require payment of undisclosed costs as a condition of receiving the goods or services.

    12.  Advertises under the guise of obtaining sales personnel when [in fact] the purpose is to first sell or lease goods or services to the sales personnel applicant.

    [12.] 13.  Makes false or misleading statements of fact concerning the price of goods or services for sale or lease, or the reasons for, existence of or amounts of price reductions.

    [13.] 14.  Fraudulently alters any contract, written estimate of repair, written statement of charges or other document in connection with the sale or lease of goods or services.

    [14.] 15.  Knowingly makes any other false representation in a transaction.

    [15.] 16.  Knowingly falsifies an application for credit relating to a retail installment transaction, as defined in NRS 97.115.

    Sec. 15.  NRS 598.0999 is hereby amended to read as follows:

    598.0999  1.  A person who violates a court order or injunction issued pursuant to the provisions of NRS 598.0903 to 598.0999, inclusive, and section 1 of Assembly Bill No. 337 of this session upon a complaint brought by the commissioner, the director, the district attorney of any county of this state or the attorney general shall forfeit and pay to the state general fund a civil penalty of not more than $10,000 for each violation. For the purpose of this section, the court issuing the order or injunction retains jurisdiction over the action or proceeding. Such civil penalties are in addition to any other penalty or remedy available for the enforcement of the provisions of NRS 598.0903 to 598.0999, inclusive, and section 1 of Assembly Bill No. 337 of this session.

    2.  In any action brought pursuant to the provisions of NRS 598.0903 to 598.0999, inclusive, and section 1 of Assembly Bill No. 337 of this session, if the court finds that a person has willfully engaged in a deceptive trade practice, the commissioner, the director, the district attorney of any county in this state or the attorney general bringing the action may recover a civil penalty not to exceed $2,500 for each violation. The court in any such action may, in addition to any other relief or reimbursement, award reasonable attorney’s fees and costs.

    3.  A natural person, firm, or any officer or managing agent of any corporation or association who knowingly and willfully engages in a deceptive trade practice : [, other than a deceptive trade practice described in NRS 598.992:]

    (a) For the first offense, is guilty of a misdemeanor.

    (b) For the second offense, is guilty of a gross misdemeanor.

    (c) For the third and all subsequent offenses, is guilty of a category D felony and shall be punished as provided in NRS 193.130.


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ê2001 Statutes of Nevada, Page 2151 (Chapter 436, AB 627)ê

 

    4.  Any offense which occurred within 10 years immediately preceding the date of the principal offense or after the principal offense constitutes a prior offense for the purposes of subsection 3 when evidenced by a conviction, without regard to the sequence of the offenses and convictions.

    5.  If a person violates any provision of NRS 598.0903 to 598.0999, inclusive, and section 1 of Assembly Bill No. 337 of this session, 598.100 to 598.2801, inclusive, 598.281 to 598.289, inclusive, 598.840 to 598.966, inclusive, sections 2 to 14, inclusive, of Assembly Bill No. 245 of this [act or 598.992,] session or sections 3 to 12, inclusive, of this act, fails to comply with a judgment or order of any court in this state concerning a violation of such a provision, or fails to comply with an assurance of discontinuance or other agreement concerning an alleged violation of such a provision, the commissioner or the district attorney of any county may bring an action in the name of the State of Nevada seeking:

    (a) The suspension of the person’s privilege to conduct business within this state; or

    (b) If the defendant is a corporation, dissolution of the corporation.

The court may grant or deny the relief sought or may order other appropriate relief.

    Sec. 16.  NRS 598.2806 is hereby amended to read as follows:

    598.2806  1.  Each credit service organization, organization for buying goods or services at a discount, dance studio and health club regulated by the provisions of this chapter shall apply for registration on the form prescribed by the division.

    2.  At the time of application for registration, the applicant [shall] must pay to the division an administrative fee of $25 and deposit the required security with the division.

    3.  Upon receipt of the security in the proper form and the payment of the administrative fee required by this section, the division shall issue a certificate of registration to the applicant. A certificate of registration [is] :

    (a) Is not transferable or assignable [.] ; and

    (b) Expires 1 year after it is issued.

    4.  A registrant must renew a certificate of registration issued pursuant to this section before the certificate expires by submitting to the division an application for the renewal of the certificate on a form prescribed by the division.

    Sec. 17.  NRS 598.2808 is hereby amended to read as follows:

    598.2808  1.  The security required to be deposited by a registrant pursuant to NRS 598.2807 must be held in trust for consumers injured by the bankruptcy of the registrant or the registrant’s breach of any agreement entered into in his capacity as a registrant.

    2.  A consumer so injured may bring and maintain an action in any court of competent jurisdiction to recover against the security.

    3.  The division may bring an action for interpleader against all claimants upon the security. If the division brings such an action, the division shall publish notice of the action at least once each week for 2 weeks in a newspaper of general circulation in the county in which the organization has its principal place of business. The division may deduct its costs of the action, including the costs of the publication of the notice, from the amount of the security. All claims against the security have equal priority. If the security is insufficient to pay all the claims in full, the claims must be paid pro rata.


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ê2001 Statutes of Nevada, Page 2152 (Chapter 436, AB 627)ê

 

pro rata. If the registrant has posted a bond with the division, the surety is then relieved of all liability under the bond.

    4.  The division may, in lieu of bringing an action for interpleader pursuant to subsection 3, conduct a hearing to determine the distribution of the security to claimants. The division shall adopt regulations to provide for adequate notice and the conduct of the hearing. If the registrant has posted a bond with the division, distribution pursuant to this subsection relieves the surety of all liability under the bond.

    5.  If the security is sufficient to pay all claims against the security in full, the division may deduct from the amount of the security, the cost of any investigation or hearing it conducted to determine the distribution of the security.

    Sec. 18.  NRS 598.946 is hereby amended to read as follows:

    598.946  1.  Except as otherwise provided in subsection 5, before advertising its services or conducting business in this state, the owner of a dance studio or a health club must register pursuant to NRS 598.2806 and 598.944 and deposit security with the division pursuant to NRS 598.2807. The security must [be] :

    (a) Be conditioned on compliance by the owner with the provisions of NRS 598.940 to 598.966, inclusive, and the terms of the contract with a buyer [.] ; and

    (b) Remain on deposit with the division until the release of the security is authorized or required pursuant to NRS 598.2809, except that the dance studio or health club may change the form of the security as provided in NRS 598.2807.

    2.  Except as otherwise provided in subsection 3, the amount of the security to be deposited must be:

    (a) Ten thousand dollars, if the dance studio or health club has less than 400 members;

    (b) Fifteen thousand dollars, if the dance studio or health club has 400 members or more but less than 800 members;

    (c) Twenty thousand dollars, if the dance studio or health club has 800 members or more but less than 1,200 members;

    (d) Twenty-five thousand dollars, if the dance studio or health club has 1,200 members or more but less than 1,500 members;

    (e) Thirty-five thousand dollars, if the dance studio or health club has 1,500 members or more but less than 4,000 members; [and]

    (f) Fifty thousand dollars, if the dance studio or health club has 4,000 members or more but less than 25,000 members [.] ; and

    (g) Two hundred and fifty thousand dollars, if the dance studio or health club has 25,000 or more members.

    3.  If a dance studio or health club conducts any pre-sale of dance lessons, the use of facilities or other services, the amount of the security required by this section is $100,000 [.] unless a greater amount is required pursuant to paragraph (g) of subsection 2.

    4.  A dance studio or health club shall report to the division on a quarterly basis the size of its membership and shall, on the basis of any change in the size of that membership, adjust accordingly the amount of the security deposited with the division.

    5.  [If a dance studio or health club has actively conducted business for not less than 4 consecutive years and has not changed ownership or, in the case of a corporation, not more than 25 percent of its authorized shares have been transferred, it is not required to deposit security with the division pursuant to NRS 598.2807.]


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ê2001 Statutes of Nevada, Page 2153 (Chapter 436, AB 627)ê

 

been transferred, it is not required to deposit security with the division pursuant to NRS 598.2807.] If , on October 1, 2001, a dance studio or health club [does not deposit such security, it shall] has not deposited security with the division pursuant to NRS 598.2807 because it was not required to do so pursuant to this section, the dance studio or health club:

    (a) Is not required to deposit security with the division pursuant to NRS 598.2807; and

    (b) Shall obtain a written acknowledgment from each member and prominently post a notice on its premises stating that no security for refunds or reimbursement has been deposited with the State of Nevada.

    Sec. 19.  NRS 598.968 is hereby amended to read as follows:

    598.968  As used in NRS 598.968 to 598.9694, inclusive, and section 13 of this act, unless the context otherwise requires, the words and terms defined in NRS 598.9682 and 598.9684 have the meanings ascribed to them in those sections.

    Sec. 20.  NRS 598.992 is hereby repealed.

    Sec. 21.  1.  Notwithstanding the provisions of section 16 of this act, a registrant that:

    (a) Is doing business in this state; and

    (b) Has a certificate of registration that was issued by the division pursuant to NRS 598.2806 before October 1, 2000,

must submit to the division an application for the renewal of the certificate of registration on a form prescribed by the division not later than October 1, 2001.

    2.  A registrant that:

    (a) Is doing business in this state; and

    (b) Has a certificate of registration that was issued by the division pursuant to NRS 598.2806 on or after October 1, 2000,

must submit to the division an application for the renewal of the certificate of registration on a form prescribed by the division not later than 1 year after the certificate of registration was issued by the division.

    3.  As used in this section, “registrant” has the meaning ascribed to it in NRS 598.2805.

    Sec. 22.  1.  This section, sections 1 to 13, inclusive, and 16 to 21, inclusive, of this act become effective on October 1, 2001.

    2.  Sections 14 and 15 of this act become effective at 12:01 a.m. on October 1, 2001.

________

 


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ê2001 Statutes of Nevada, Page 2154ê

 

CHAPTER 437, AB 115

Assembly Bill No. 115–Committee on Ways and Means

 

CHAPTER 437

 

AN ACT relating to the state department of agriculture; expanding the types of fees that must be used in the plant industry program and expanding the purposes for which expenditures for the plant industry program may be made; abolishing the apiary inspection account; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 561.355 is hereby amended to read as follows:

    561.355  1.  The plant industry program is hereby established.

    2.  The following fees and money [shall] must be used in the plant industry program:

    (a) Fees and money collected pursuant to the provisions of chapters 552, 555, 581, 582 and 587 of NRS.

    (b) Laboratory fees collected for the diagnosis of infectious, contagious and parasitic diseases of bees, as authorized by NRS 561.305, and as are necessary pursuant to the provisions of chapter 552 of NRS.

    (c) Laboratory fees collected for the diagnosis of infectious, contagious and destructive diseases of agricultural commodities, and infestations thereof by pests, as authorized by NRS 561.305, and as may be necessary [under] pursuant to the provisions of NRS 554.010 to 554.240, inclusive.

    [(c)] (d) Laboratory fees collected for the survey and identification of insect pests, plant diseases and noxious weeds, as authorized by NRS 561.305, and as may be necessary [under] pursuant to the provisions of NRS 555.010 to 555.249, inclusive.

    [(d)] (e) Laboratory fees collected for the testing of the purity and germinating power of agricultural seeds, as authorized by NRS 561.305, and as may be necessary [under] pursuant to the provisions of NRS 587.015 to 587.123, inclusive.

    3.  Expenditures for the plant industry program [shall] must be made only for the purposes of carrying out the provisions of this chapter and chapters 552, 554, 555, 581, 582 and 587 of NRS . [, and the provisions of this chapter.]

    Sec. 2.  NRS 552.300 is hereby amended to read as follows:

    552.300  1.  Upon presentation of satisfactory evidence by the state quarantine officer, the chief inspector or any deputy inspector of the violation of any of the provisions of this chapter, any district attorney shall, without delay, prosecute the person who has violated any of the provisions of this chapter.

    2.  The department may employ counsel to assist in the prosecution of any person charged with the violation of any of the provisions of this chapter and compensate the counsel so employed from the [apiary inspection account.] plant industry program.

    Sec. 3.  NRS 561.365 is hereby repealed.

    Sec. 4.  This act becomes effective on July 1, 2001.

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ê2001 Statutes of Nevada, Page 2155ê

 

CHAPTER 438, AB 503

Assembly Bill No. 503–Committee on Ways and Means

 

CHAPTER 438

 

AN ACT making an appropriation to the Department of Business and Industry for the replacement of certain computers in the Office of the Labor Commissioner; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Business and Industry the sum of $15,867 for the replacement of certain computers in the Office of the Labor Commissioner.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 439, AB 506

Assembly Bill No. 506–Committee on Ways and Means

 

CHAPTER 439

 

AN ACT making an appropriation to the State Department of Conservation and Natural Resources for maintenance projects at state parks; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the State Department of Conservation and Natural Resources the sum of $593,928 for maintenance projects at state parks.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2156ê

 

CHAPTER 440, AB 514

Assembly Bill No. 514–Committee on Ways and Means

 

CHAPTER 440

 

AN ACT making an appropriation to the Interim Finance Committee for allocation to the Department of Human Resources for an electronic application process for the Nevada Check Up program and Medicaid assistance; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  1.  There is hereby appropriated from the state general fund to the Interim Finance Committee the sum of $500,000 for allocation to the Department of Human Resources for the costs of developing and converting to an electronic application process for the Nevada Check Up program and Medicaid assistance.

    2.  The Department of Human Resources may submit a request to the Interim Finance Committee for the allocation of all or any part of the money appropriated by subsection 1 at any time. Any such request must include a plan for the development of and conversion to the new electronic application process, in addition to a description of the proposed new process.

    3.  Upon receipt of a request from the Department of Human Resources for the allocation of money appropriated by subsection 1, the Interim Finance Committee shall consider the request and may require any additional information that it determines is necessary to make a final decision.

    4.  Upon considering a request submitted by the Department of Human Resources, and any additional information requested, the Interim Finance Committee shall determine whether to allocate all or any portion of the money appropriated by subsection 1. The Interim Finance Committee is not required to approve the entire funding in any request or to allocate the entire amount appropriated. If the Interim Finance Committee makes an allocation of money pursuant to this section, it shall require such documentation and reporting as it deems necessary. Any change from the plans for the development of or conversion to the new process that were submitted with the request for the allocation must be approved by the Interim Finance Committee before money is committed for expenditure on the portion that is changed.

    5.  Any remaining balance of the appropriation made by subsection 1 must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 2.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2157ê

 

CHAPTER 441, AB 516

Assembly Bill No. 516–Committee on Ways and Means

 

CHAPTER 441

 

AN ACT making an appropriation to the Department of Human Resources for the Medicaid Management Information System; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources the sum of $2,090,840 for the Medicaid Management Information System.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 442, AB 523

Assembly Bill No. 523–Committee on Ways and Means

 

CHAPTER 442

 

AN ACT making appropriations to the Motor Pool Division of the Department of Administration and the Investigation Division of the Department of Motor Vehicles and Public Safety for the purchase of additional vehicles; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  1.  There is hereby appropriated from the state general fund to the Motor Pool Division of the Department of Administration the sum of $1,749,874 for the purchase of additional vehicles.

    2.  Any remaining balance of the appropriation made by subsection 1 must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 2.  1.  There is hereby appropriated from the state general fund to the Investigation Division of the Department of Motor Vehicles and Public Safety the sum of $274,012 for the purchase of motor vehicles.

    2.  Any remaining balance of the appropriation made by subsection 1 must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.


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ê2001 Statutes of Nevada, Page 2158 (Chapter 442, AB 523)ê

 

    Sec. 3.  1.  There is hereby appropriated from the state highway fund to the Investigation Division of the Department of Motor Vehicles and Public Safety the sum of $22,341 for the purchase of a motor vehicle.

    2.  Any remaining balance of the appropriation made by subsection 1 must not be committed for expenditure after June 30, 2003, and reverts to the state highway fund as soon as all payments of money committed have been made.

    Sec. 4.  This act becomes effective upon passage and approval.

________

 

CHAPTER 443, AB 525

Assembly Bill No. 525–Committee on Ways and Means

 

CHAPTER 443

 

AN ACT making an appropriation to the Supreme Court of Nevada for security system upgrades, a system-wide website and communications infrastructure, and new and replacement equipment; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Supreme Court of Nevada the sum of $395,028 for security system upgrades, a system-wide website and communications infrastructure, and new and replacement equipment.

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 444, AB 526

Assembly Bill No. 526–Committee on Ways and Means

 

CHAPTER 444

 

AN ACT making an appropriation to the Department of Taxation for the purchase of new and replacement equipment; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Taxation the sum of $454,173 for the purchase of new and replacement equipment.


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ê2001 Statutes of Nevada, Page 2159 (Chapter 444, AB 526)ê

 

    Sec. 2.  Any remaining balance of the appropriation made by section 1 of this act must not be committed for expenditure after June 30, 2003, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 

CHAPTER 445, AB 554

Assembly Bill No. 554–Committee on Government Affairs

 

CHAPTER 445

 

AN ACT relating to higher education; requiring the state treasurer to adopt regulations to establish and carry out the Nevada college savings program as authorized by federal law; creating the Nevada college savings trust fund and providing for its administration; eliminating the prospective expiration of various provisions governing the program for the prepayment of tuition at an institution of higher education; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 353B of NRS is hereby amended by adding thereto the provisions set forth as sections 2 to 13, inclusive, of this act.

    Sec. 2.  As used in this chapter, unless the context otherwise requires, “board” means the board of trustees of the college savings plans of Nevada created by section 3 of this act.

    Sec. 3.  1.  There is hereby created a board of trustees of the college savings plans of Nevada.

    2.  The board consists of five members composed of:

    (a) The state treasurer, who may name a designee to serve on the board on his behalf.

    (b) The director of the department of administration, who may name a designee to serve on the board on his behalf.

    (c) The chancellor of the system, who may name a designee to serve on the board on his behalf.

    (d) Two members appointed by the governor. A member who is appointed by the governor must possess knowledge, skill and experience in the field of:

         (1) Accounting;

         (2) Finance;

         (3) Investment management; or

         (4) Marketing.

    3.  A member of the board who is appointed by the governor:

    (a) Serves for a term of 4 years;

    (b) Except as otherwise provided in paragraph (c), may be reappointed by the governor; and

    (c) Except as otherwise provided in this paragraph, may serve for only two terms. A member who is appointed to fill a vacancy in an unexpired term that is not longer than 3 years may serve two terms in addition to the unexpired term.


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ê2001 Statutes of Nevada, Page 2160 (Chapter 445, AB 554)ê

 

    4.  The state treasurer or his designee shall serve as the chairman of the board.

    5.  Each member of the board serves without compensation, except that each member is entitled to receive:

    (a) The per diem allowance and travel expenses provided for state officers and employees generally; and

    (b) Reimbursement for any other actual and reasonable expense incurred while performing his duties.

    6.  As used in this section, the term “college savings plans of Nevada” includes the Nevada higher education prepaid tuition program set forth in NRS 353B.010 to 353B.810, inclusive, and the Nevada college savings program set forth in sections 6 to 13, inclusive, of this act.

    Sec. 4.  Notwithstanding the provisions of any specific statute to the contrary, no money on deposit in a prepaid tuition contract pursuant to NRS 353B.010 to 353B.810, inclusive, or a savings trust account pursuant to sections 6 to 13, inclusive, of this act may be considered an asset of a parent, guardian or student for the purpose of determining the eligibility of a person for a grant, scholarship or work opportunity that is based on need and offered or administered by a state agency, except as otherwise required by the source of the funding of the grant, scholarship or work opportunity.

    Sec. 5.  The board may endorse insurance coverage written exclusively to protect prepaid tuition contracts, and purchasers and beneficiaries of prepaid tuition contracts pursuant to NRS 353B.010 to 353B.810, inclusive, and the regulations adopted pursuant thereto, and savings trust accounts and account owners, and beneficiaries of savings trust accounts pursuant to sections 6 to 13, inclusive, of this act, and the regulations adopted pursuant thereto, which may be issued in the form of a group life policy. The provisions of Title 57 of NRS are not applicable to the board in carrying out the provisions of this section.

    Sec. 6.  As used in sections 6 to 13, inclusive, of this act, unless the context otherwise requires, “trust fund” means the Nevada college savings trust fund created by section 8 of this act.

    Sec. 7.  1.  The state treasurer shall adopt regulations to establish and carry out the Nevada college savings program, which must comply with the requirements of a qualified state tuition program pursuant to 26 U.S.C. § 529.

    2.  The regulations must be consistent with the provisions of the Internal Revenue Code set forth in Title 26 of the United States Code, and the regulations adopted pursuant thereto, to ensure that the Nevada college savings program meets all criteria for federal tax-deferred or tax-exempt benefits, or both.

    3.  The regulations must provide for the use of savings trust agreements and savings trust accounts to apply distributions toward qualified higher education expenses at eligible educational institutions in accordance with 26 U.S.C. § 529.

    4.  The regulations may include any other provisions not inconsistent with federal law that the state treasurer determines are necessary for the efficient and effective administration of the Nevada college savings program and the trust fund.


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ê2001 Statutes of Nevada, Page 2161 (Chapter 445, AB 554)ê

 

    Sec. 8.  1.  The Nevada college savings trust fund is hereby created.

    2.  The trust fund is an instrumentality of this state, and its property and income are exempt from all taxation by this state and any political subdivision thereof.

    3.  The trust fund consists of:

    (a) All legislative appropriations made thereto;

    (b) All money acquired by or for the use of the trust fund from:

         (1) Any other governmental source, including, without limitation, any grant from the Federal Government, or a state or local government; or

         (2) Any private source, including, without limitation, any gift, bequest, devise or endowment;

    (c) All money deposited in accordance with savings trust agreements; and

    (d) All earnings on the money in the trust fund.

    4.  All money deposited in accordance with savings trust agreements and all earnings on such money:

    (a) Are not the property of this state, and this state has no claim to or interest in such money; and

    (b) Must not be commingled with money of this state.

    5.  A savings trust agreement or any other contract entered into by or on behalf of the trust fund does not constitute a debt or obligation of this state, and no account owner is entitled to any money in the trust fund except for that money on deposit in or accrued to his account.

    6.  The money in the trust fund must be preserved, invested and expended solely pursuant to and for the purposes authorized by sections 6 to 13, inclusive, of this act and must not be loaned or otherwise transferred or used by this state for any other purpose.

    Sec. 9.  1.  The trust fund must be administered by the state treasurer.

    2.  The state treasurer shall establish such accounts within the trust fund as he determines necessary, including, without limitation, a program account, an administrative account and an endowment account.

    3.  The program account must be used for the receipt, investment and disbursement of money pursuant to savings trust agreements.

    4.  The administrative account must be used for the deposit and disbursement of money to administer and market the Nevada college savings program and to supplement the administration and marketing of the Nevada higher education prepaid tuition program set forth in NRS 353B.010 to 353B.810, inclusive.

    5.  The endowment account must be used for the deposit of any money received by the trust fund that is not received pursuant to a savings trust agreement and, in the determination of the state treasurer, is not necessary for the use of the administrative account. The money in the endowment account may be expended for any purpose related to the Nevada college savings program or otherwise to assist the residents of this state to attain post-secondary education.

    Sec. 10.  The state treasurer may accept and expend on behalf of the trust fund money provided by private entities for direct expenses or marketing. Such money is not a part of the trust fund.

    Sec. 11.  1.  The board shall establish a comprehensive investment plan for the money in the trust fund.

    2.  Notwithstanding the provisions of any specific statute to the contrary, the board may invest or cause to be invested any money in the trust fund, including, without limitation, the money in the program account, in any manner reasonable and appropriate to achieve the objectives of the Nevada college savings program, exercising the discretion and care of a prudent person in similar circumstances with similar objectives.


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ê2001 Statutes of Nevada, Page 2162 (Chapter 445, AB 554)ê

 

trust fund, including, without limitation, the money in the program account, in any manner reasonable and appropriate to achieve the objectives of the Nevada college savings program, exercising the discretion and care of a prudent person in similar circumstances with similar objectives. The board shall consider the risk, expected rate of return, term or maturity, diversification of total investments, liquidity and anticipated investments in and withdrawals from the trust fund.

    3.  The board may establish criteria and select investment managers, mutual funds or other such entities to act as investment managers for the Nevada college savings program.

    4.  The board may employ or contract with investment managers, evaluation services or other services as determined by the board to be necessary for the effective and efficient operation of the Nevada college savings program.

    5.  The board may employ personnel and contract for goods and services necessary for the effective and efficient operation of the Nevada college savings program.

    6.  The marketing plan and materials for the Nevada college savings program must be approved by the board.

    7.  The board may prescribe terms and conditions of savings trust agreements.

    8.  The board may contract with one or more qualified entities for the day-to-day operations of the Nevada college savings program as the program administrator for the management of the marketing of the program, the administration of the comprehensive investment plan and trust fund, the selection of investment managers for the Nevada college savings program, and the performance of similar activities.

    9.  All contracts authorized by this section are subject to the requirements of chapter 333 of NRS, except that:

    (a) Notwithstanding the provisions of subsection 1 of NRS 333.165 to the contrary, the board shall contract for all services regardless of the estimated value of the services; and

    (b) Notwithstanding the provisions of NRS 333.335 to the contrary, each proposal received by the board concerning services must be evaluated by the board at a public meeting and each contract for services must be awarded by the board at a public meeting.

    Sec. 12.  Savings trust accounts and agreements entered into pursuant to sections 6 to 13, inclusive, of this act are not guaranteed by the full faith and credit of the State of Nevada.

    Sec. 13.  The board may delegate to the state treasurer any of its administrative powers and duties specified in sections 6 to 13, inclusive, of this act, if the board determines that such delegation is necessary for the efficient and effective administration of the Nevada college savings program and the trust fund.

    Sec. 14.  NRS 353B.010 is hereby amended to read as follows:

    353B.010  As used in [this chapter,] NRS 353B.010 to 353B.810, inclusive, unless the context otherwise requires, the words and terms defined in NRS [353B.020] 353B.030 to 353B.070, inclusive, have the meanings ascribed to them in those sections.

    Sec. 15.  NRS 353B.070 is hereby amended to read as follows:

    353B.070  “Trust fund” means the Nevada higher education prepaid tuition trust fund created pursuant to NRS 353B.140.


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ê2001 Statutes of Nevada, Page 2163 (Chapter 445, AB 554)ê

 

    Sec. 16.  NRS 353B.090 is hereby amended to read as follows:

    353B.090  1.  The board shall develop [a] the Nevada higher education prepaid tuition program for the prepayment of tuition at a guaranteed rate which is established based on the annual actuarial study required pursuant to NRS 353B.190 for undergraduate studies at a university or community college that is a member of the system.

    2.  The board shall [establish rules] adopt regulations for the implementation of the program, including, without limitation, [rules] regulations setting forth requirements for residency, a limit on the number of qualified beneficiaries, the termination, withdrawal and transfer of money paid into the trust fund, the time within which the money paid into the trust fund must be used, and payment schedules.

    Sec. 17.  NRS 353B.140 is hereby amended to read as follows:

    353B.140  1.  The Nevada higher education prepaid tuition trust fund is hereby created within the state treasury to allow the cost of tuition to be paid in advance of enrollment at an institution of higher education.

    2.  The trust fund consists of payments received pursuant to:

    (a) A prepaid tuition contract;

    (b) A bequest, endowment or grant from the Federal Government; or

    (c) Any other public or private source of money.

    3.  Money in the trust fund that is not expended during any biennium does not revert to the state general fund at any time.

    Sec. 18.  NRS 353B.150 is hereby amended to read as follows:

    353B.150  1.  The state treasurer shall administer the trust fund.

    2.  As administrator of the trust fund, the state treasurer:

    (a) Shall maintain the financial records of the trust fund;

    (b) Shall invest the property in the trust fund pursuant to the policies for investment established by the board pursuant to NRS 353B.160;

    (c) Shall manage any account associated with the trust fund;

    (d) Shall maintain any instruments that evidence investments made with property from the trust fund;

    (e) May contract with vendors for any good or service that is necessary to carry out the provisions of [this chapter;] NRS 353B.010 to 353B.810, inclusive;

    (f) May hire such employees as are necessary to carry out the provisions of [this chapter,] NRS 353B.010 to 353B.810, inclusive, who must be paid out of the assets of the trust fund; and

    (g) May perform any other duties necessary to administer the trust fund.

    Sec. 19.  NRS 353B.160 is hereby amended to read as follows:

    353B.160  1.  The board shall create a comprehensive plan that specifies the policies for investment which the state treasurer shall follow in his administration of the trust fund.

    2.  The board may authorize the state treasurer to invest the property of the trust fund in:

    (a) A bond, note, certificate or other general obligation of the State of Nevada, or of a county, city, general improvement district or school district of the State of Nevada.

    (b) A corporate bond of a corporation created by or existing under the laws of the United States or of a state, district or territory of the United States with a rating not lower than “A” or its equivalent by a nationally recognized rating service. The total amount invested in such bonds must not exceed 50 percent of the book value of the total fixed income investments of the trust fund.


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ê2001 Statutes of Nevada, Page 2164 (Chapter 445, AB 554)ê

 

percent of the book value of the total fixed income investments of the trust fund.

    (c) Commercial paper of a corporation created by or existing under the laws of the United States or of a state, district or territory of the United States or of a wholly owned subsidiary of such a corporation with a rating not lower than A-3 or P-3 by a nationally recognized rating service.

    (d) A bond, note, debenture or other valid obligation that is issued by the Treasury of the United States.

    (e) A bond, note, debenture or other security that is issued by an agency or instrumentality of the United States or that is fully guaranteed by the United States in:

         (1) The Federal Farm Credit Bank;

         (2) The Federal National Mortgage Association;

         (3) The Federal Home Loan Bank;

         (4) The Federal Home Loan Mortgage Corporation; or

         (5) The Government National Mortgage Association.

    (f) A bond, note, debenture or other security in the Student Loan Marketing Association, regardless of whether it is guaranteed by the United States.

    (g) Collateralized mortgage obligations that are rated “AAA” or its equivalent by a nationally recognized rating service.

    (h) Asset-backed securities that are rated “AAA” or its equivalent by a nationally recognized rating service.

    (i) Money market mutual funds that:

         (1) Are registered with the Securities and Exchange Commission;

         (2) Are rated by a nationally recognized rating service as “A” or its equivalent, or better; and

         (3) Invest only in securities issued by the Federal Government or agencies of the Federal Government or in repurchase agreements fully collateralized by such securities.

The total dollar amount invested in such mutual funds must not exceed 20 percent of the total dollar amount of the trust fund that is invested.

    (j) Common or preferred stock of a corporation created by or existing under the laws of the United States or of a state, district or territory of the United States, if:

         (1) The stock of the corporation is:

             (I) Listed on a national stock exchange; or

             (II) Traded in the over-the-counter market, if the price quotations for the over-the-counter stock are quoted by the National Association of Securities Dealers Automated Quotations System [(NASDAQ);] , NASDAQ;

         (2) The outstanding shares of the corporation have a total market value of not less than $50,000,000;

         (3) The maximum investment in stock is not greater than 60 percent of the book value of the total investments of the trust fund;

         (4) Except for investments made pursuant to paragraph (m), the amount of an investment in a single corporation is not greater than 3 percent of the book value of the assets of the trust fund; and

         (5) Except for investments made pursuant to paragraph (m), the total amount of shares owned by the trust fund is not greater than 5 percent of the outstanding stock of a single corporation.

    (k) A covered call or put option on securities that are traded on one or more of the regulated exchanges in the United States.


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ê2001 Statutes of Nevada, Page 2165 (Chapter 445, AB 554)ê

 

    (l) A pooled or commingled real estate fund or a real estate security that is managed by a corporate trustee or by an investment advisory firm that is registered with the Securities and Exchange Commission, either of which may be retained by the board as an investment manager. The shares and the pooled or commingled fund must be held in trust. The total book value of an investment made under this paragraph must not at any time be greater than 5 percent of the total book value of all investments of the trust fund.

    (m) Mutual funds or common trust funds that consist of any combination of the investments listed in paragraphs (a) to (l), inclusive.

    3.  The state treasurer shall exercise the standard of care in investing the property of the fund that a person of prudence, discretion and intelligence would exercise in the management of his own affairs, given the prevailing circumstances, not in regard to speculation but rather to the permanent disposition of the property, considering the potential income from and the probable safety of his capital.

    4.  Subject to the terms, conditions, limitations and restrictions set forth in this section, the state treasurer may sell, assign, transfer or dispose of the property and investments of the trust fund upon the approval of a majority of the board.

    5.  The assets of the trust fund:

    (a) Must be maintained, invested and expended solely for the purposes of [this chapter;] NRS 353B.010 to 353B.810, inclusive; and

    (b) Must not be loaned, transferred or otherwise used for a purpose other than the purposes of [this chapter.] NRS 353B.010 to 353B.810, inclusive.

    6.  The state treasurer shall credit any income derived from an investment or a gain from a sale or exchange of an investment to the trust fund.

    7.  The state treasurer shall acquire each investment for the trust fund at a price not to exceed the prevailing market value for such an investment.

    8.  Each investment in the trust fund must be clearly marked to indicate ownership by the trust fund.

    9.  The state treasurer, an employee of the state treasurer, or a member or employee of the board shall not:

    (a) Have a direct or indirect interest in the income, gain or profit of an investment that the state treasurer makes;

    (b) Receive pay or emolument for his services in connection with an investment that the state treasurer makes; or

    (c) Become an endorser, surety or obligor for money that is borrowed from the trust fund.

    10.  If the annual actuarial study performed pursuant to NRS 353B.190 reveals that there is insufficient money to ensure the actuarial soundness of the trust fund, the board shall modify the terms of subsequent prepaid tuition contracts.

    11.  The terms, conditions, limitations and restrictions regarding investments of the trust fund listed in this section apply only at the time an investment is originally acquired and must not be construed to require the liquidation of an investment at any time.

    Sec. 20.  NRS 353B.810 is hereby amended to read as follows:

    353B.810  The provisions of [this chapter] NRS 353B.010 to 353B.810, inclusive, must not be construed as a promise or guarantee that a qualified beneficiary:

    1.  Will be admitted to, allowed to continue enrollment at or graduated from a community college or university; or


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ê2001 Statutes of Nevada, Page 2166 (Chapter 445, AB 554)ê

 

    2.  Will have the full cost of his tuition paid at a community college, college or university that is not a member of the system.

    Sec. 21.  Section 25 of chapter 687, Statutes of Nevada 1997, at page 3489, is hereby amended to read as follows:

    Sec. 25.  [1.]  This act becomes effective on October 1, 1997 . [, and, except as otherwise provided in subsection 2, expires by limitation when the board notifies the governor pursuant to subsection 1 of section 24 of this act that it has performed all duties and obligations pursuant to any prepaid tuition contract entered into before July 1, 2001.

    2.  Sections 12, 13 and 14 of this act expire by limitation on July 1, 2001.]

    Sec. 22.  Section 5 of chapter 141, Statutes of Nevada 1999, at page 803, is hereby amended to read as follows:

    Sec. 5.  [1.]  This act becomes effective upon passage and approval.

    [2.  The amendatory provisions of section 1 of this act expire by limitation when the board notifies the governor pursuant to subsection 1 of section 24 of chapter 687, Statutes of Nevada 1997, that it has performed all duties and obligations pursuant to any prepaid tuition contract entered into before July 1, 2001.]

    Sec. 23.  1.  NRS 353B.020 and 353B.080 are hereby repealed.

    2.  Section 24 of chapter 687, Statutes of Nevada 1997, at page 3489, is hereby repealed.

    Sec. 24.  This act becomes effective upon passage and approval.

________

 

CHAPTER 446, AB 618

Assembly Bill No. 618–Committee on Commerce and Labor

 

CHAPTER 446

 

AN ACT relating to insurance; providing for the regulation of the business of viatical settlements; requiring the commissioner of insurance to adopt regulations governing the use of electronic records and signatures; temporarily authorizing the adoption of regulations to enforce federal law concerning a bill of rights for patients; limiting the disclosure of certain information concerning consumers; providing for the conversion of domestic mutual insurers into domestic stock insurers; providing for the reorganization of domestic mutual insurers into mutual insurance holding companies; making various other changes concerning the regulation of insurance; providing penalties; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Title 57 of NRS is hereby amended by adding thereto a new chapter to consist of the provisions set forth as sections 2 to 52, inclusive, of this act.

    Sec. 2.  As used in sections 2 to 52, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 3 to 16, inclusive, of this act have the meanings ascribed to them in those sections.


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ê2001 Statutes of Nevada, Page 2167 (Chapter 446, AB 618)ê

 

    Sec. 3.  “Advertising” means a written, electronic or printed communication or a communication by recorded telephone message, radio, television, the Internet or a similar medium of communication, including a film strip, motion picture or videotape, published, communicated or otherwise placed before the public to create an interest in, or induce a person to sell a policy of life insurance pursuant to, a viatical settlement.

    Sec. 4.  “Broker of viatical settlements” means a person who on behalf of a viator and for a fee, commission or other valuable consideration offers or attempts to negotiate a viatical settlement between the viator and one or more providers of viatical settlements. The term does not include an attorney at law, certified public accountant or financial planner accredited by a nationally recognized accrediting agency who is retained by the viator and whose compensation is not paid by a provider or purchaser of viatical settlements.

    Sec. 5.  “Business of viatical settlements” means the offering, solicitation, negotiation, procurement, effectuation, purchasing, financing, monitoring, tracking, underwriting, selling, transferring, pledging or otherwise hypothecating viatical settlements.

    Sec. 6.  “Chronically ill” means:

    1.  Being unable to perform at least two activities of daily living, such as eating, moving from one place to another, bathing, dressing, continence, defecation or urination;

    2.  Requiring substantial supervision for protection from threats to health and safety because of cognitive impairment; or

    3.  Having a level of disability similar to that described in subsection 1 as determined by the Secretary of Health and Human Services.

    Sec. 7.  1.  “Financing agent” means an underwriter, agent for placement, enhancer of credit, lender, purchaser of securities, purchaser of a policy from a provider of viatical settlements or other person that may enter into a viatical settlement and has direct ownership in a policy that is the subject of the viatical settlement but:

    (a) Whose principal activity related to the transaction is providing money to effect the viatical settlement; and

    (b) Who has an agreement in writing with one or more licensed providers of viatical settlements to finance the acquisition of one or more viatical settlements.

    2.  The term does not include a nonaccredited investor or a purchaser of viatical settlements.

    Sec. 8.  “Policy” means an individual or group policy, group certificate, contract or arrangement of life insurance affecting the rights of a person, whether or not delivered or issued for delivery in this state.

    Sec. 9.  “Provider of viatical settlements” means a person other than a viator who enters into or effectuates a viatical settlement. The term does not include:

    1.  A bank, savings and loan association, thrift company, credit union or other licensed lender that takes an assignment of a policy as security for a loan;

    2.  The issuer of a policy that provides accelerated benefits pursuant to the contract;

    3.  An authorized or eligible insurer that provides stop-loss coverage to a provider or purchaser of viatical settlements;


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ê2001 Statutes of Nevada, Page 2168 (Chapter 446, AB 618)ê

 

    4.  A natural person who enters into no more than one agreement in a calendar year for the transfer of policies for a value less than the expected death benefit;

    5.  A financing agent;

    6.  A special organization;

    7.  A trust for a related provider; or

    8.  A purchaser of viatical settlements.

    Sec. 10.  “Purchaser of viatical settlements” means a person who gives a sum of money as consideration for a policy or an interest in the death benefits of a policy, or a person who owns or acquires or is entitled to a beneficial interest in a trust that owns a viatical settlement contract or is the beneficiary of a policy that has been or will be the subject of a viatical settlement contract, for the purpose of deriving an economic benefit. The term does not include:

    1.  A person licensed pursuant to sections 2 to 52, inclusive, of this act;

    2.  An accredited investor or qualified institutional buyer as defined respectively in Regulation D, Rule 501 or Rule 144A of the Federal Securities Act of 1933, as amended;

    3.  A financing agent;

    4.  A special organization; or

    5.  A trust for a related provider.

    Sec. 11.  “Special organization” means an organization formed by a licensed provider of viatical settlements solely to enable the provider to gain access to institutional markets for capital.

    Sec. 12.  “Terminally ill” means having an illness that can reasonably be expected to result in death within 24 months.

    Sec. 13.  “Trust for a related provider” means a trust established by a licensed provider of viatical settlements solely to hold the ownership of or beneficial interests in purchased policies in connection with financing.

    Sec. 14.  “Viatical settlement” means a written agreement for the payment of money, or anything else of value, which is less than the expected death benefit of a policy, in exchange for the viator’s assignment, sale, transfer or devise of the death benefit or ownership of any portion of the policy. The term includes:

    1.  An agreement for a loan or other financing secured primarily by a policy, other than a loan by an insurer pursuant to or secured by the cash value of a policy; and

    2.  An agreement to transfer ownership or change the beneficiary, in the future, regardless of the date of payment to the viator.

    Sec. 15.  “Viaticated policy” means a policy that has been acquired by a provider of viatical settlements pursuant to a viatical settlement.

    Sec. 16.  “Viator” means the owner of a policy or the holder of a certificate of insurance under a policy of group insurance. The term is not limited to an owner who is terminally or chronically ill except where that limitation is expressly provided.

    Sec. 17.  The trustee of a trust for a related provider must agree in writing with the provider of viatical settlements that the provider is responsible for ensuring compliance with all statutory and regulatory requirements and that the trustee will make all records and files related to viatical settlements available to the commissioner as if those records and files were maintained directly by the provider.


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ê2001 Statutes of Nevada, Page 2169 (Chapter 446, AB 618)ê

 

    Sec. 18.  If there is more than one viator with respect to a single policy and they are residents of different states, the legal effect of a viatical settlement is governed by the law of the state in which the viator having the largest fractional ownership resides. If the viators own equal fractions, they may agree in writing to choose the state in which one resides.

    Sec. 19.  1.  A person shall not, without first obtaining a license from the commissioner, operate in or from this state as a provider or broker of viatical settlements.

    2.  Application for a license must be made to the commissioner on a form prescribed by him, accompanied by the prescribed fee. A license may be renewed from year to year on its anniversary by payment of the prescribed fee. The license expires if the fee is not paid by that date.

    3.  An applicant shall provide information on forms required by the commissioner, who may at any time require the applicant to disclose the identity of all stockholders, partners, members, officers and employees. The commissioner may refuse to issue a license to an organization if he is not satisfied that a stockholder, partner, member or officer who may materially influence the applicant’s conduct satisfies the requirements of this chapter.

    4.  A license issued to an organization authorizes all partners, members, officers and designated employees to act as providers or brokers of viatical settlements. Those persons must be named in the application or a supplement to it.

    Sec. 20.  1.  Upon the filing of an application and payment of the fee, the commissioner shall investigate the applicant, and issue a license if he finds that the applicant:

    (a) If a provider of viatical settlements, has set forth a detailed plan of operation;

    (b) Is competent and trustworthy and intends to act in good faith in the capacity for which the license is sought;

    (c) Has a good reputation in business and, if a natural person, has had experience, training or education which qualifies him in that capacity;

    (d) If an organization, provides a certificate of good standing from the state of its domicile; and

    (e) If a provider or broker of viatical settlements, has included a plan to prevent fraud which satisfies the requirements of section 50 of this act.

    2.  The commissioner shall not issue a license to a nonresident unless a written designation of an agent for service of process, or an irrevocable written consent to the commencement of an action against the applicant by service of process upon the commissioner, accompanies the application.

    3.  A provider or broker of viatical settlements shall furnish to the commissioner new or revised information concerning partners, members, officers, holders of more than 10 percent of its stock, and designated employees within 30 days after a change occurs.

    Sec. 21.  After notice, and after a hearing if requested, the commissioner may suspend, revoke, refuse to issue or refuse to renew a license under this chapter if he finds that:

    1.  There was material misrepresentation in the application for the license;

    2.  The licensee or an officer, partner, member or significant managerial employee has been convicted of fraudulent or dishonest practices, is subject to a final administrative action for disqualification, or is otherwise shown to be untrustworthy or incompetent;


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ê2001 Statutes of Nevada, Page 2170 (Chapter 446, AB 618)ê

 

    3.  A provider of viatical settlements has engaged in a pattern of unreasonable payments to viators;

    4.  The applicant or licensee has been found guilty of, or pleaded guilty or nolo contendere to, a felony or a misdemeanor involving fraud, forgery, embezzlement, obtaining money under false pretenses, larceny, extortion, conspiracy to defraud or any crime involving moral turpitude, whether or not a judgment of conviction has been entered by the court;

    5.  A provider of viatical settlements has entered into a viatical settlement in a form not approved pursuant to section 22 of this act;

    6.  A provider of viatical settlements has failed to honor obligations of a viatical settlement;

    7.  The licensee no longer meets a requirement for initial licensure;

    8.  A provider of viatical settlements has assigned, transferred or pledged a viaticated policy to a person other than another provider licensed under this chapter, a purchaser of the viatical settlement, a special organization or a trust for a related provider;

    9.  The applicant or licensee has provided materially untrue information to an insurer that issued a policy that is the subject of a viatical settlement; or

    10.  The applicant or licensee has violated a provision of this chapter.

    Sec. 22.  A person shall not use a form of viatical settlement or of disclosure in this state unless the form has been filed with and approved by the commissioner. The commissioner shall disapprove such a form if, in his opinion, the settlement or any of its terms is unreasonable, contrary to the interests of the public or otherwise misleading or unfair to the viator. The commissioner may require the submission of advertising material before its use.

    Sec. 23.  1.  Each licensee under this chapter shall file with the commissioner on or before March 1 of each year an annual statement containing such information as the commissioner prescribes by regulation.

    2.  Except as allowed or required by a statute other than this chapter, a provider or broker of viatical settlements, an insurer, a producer of insurance, an information bureau, a rating agency or any other person knowing the identity of an insured shall not disclose that identity as an insured to any other person unless the disclosure is:

    (a) Necessary to effect a viatical settlement between the viator and a provider of viatical settlements and the viator and the insured have given prior written consent to the disclosure;

    (b) Furnished in response to an investigation or examination by the commissioner or another governmental officer or agency;

    (c) A term of or condition to the transfer of a policy by one provider of viatical settlements to another provider; or

    (d) Necessary to permit a financing agent to finance the purchase of a policy by a provider of viatical settlements and the insured has given prior written consent to the disclosure.

    Sec. 24.  The commissioner may examine or investigate a licensee under this chapter as often as he considers appropriate. An examination will be conducted in the manner provided in NRS 679B.230 to 679B.300, inclusive. The commissioner may also examine or investigate any other person or business insofar as he considers necessary or material to the examination or investigation of the licensee. Instead of an examination or investigation under this chapter of a foreign or alien person licensed under this chapter, the commissioner may accept a report on examination or investigation of the licensee by the equivalent authority of the licensee’s state of domicile or port of entry.


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ê2001 Statutes of Nevada, Page 2171 (Chapter 446, AB 618)ê

 

this chapter, the commissioner may accept a report on examination or investigation of the licensee by the equivalent authority of the licensee’s state of domicile or port of entry.

    Sec. 25.  1.  A person required to be licensed under this chapter shall retain for 5 years copies of all:

    (a) Contracts, underwriting documents, forms of policy and applications, from the date of the proposal, offer or execution, whichever is latest;

    (b) Checks, drafts and other evidence or documentation relating to the payment, transfer or release of money, from the date of the transaction; and

    (c) Records and documents related to the requirements of this chapter.

    2.  This section does not relieve a person of the obligation to produce a document described in subsection 1 to the commissioner after the expiration of the relevant period if the person has retained the document.

    3.  Records required by this section to be retained must be legible and complete. They may be retained in any form or by any process that accurately reproduces or is a durable medium for the reproduction of the record.

    Sec. 26.  1.  With each application for a viatical settlement, a provider or broker of viatical settlements shall furnish to the viator at least the following disclosures no later than the time the application for the settlement is signed by all the parties, in a separate document signed by the viator and the provider or broker:

    (a) The possible alternatives to viatical settlement, including any accelerated death benefits or loans offered under the viator’s policy.

    (b) Some or all of the proceeds of the viatical settlement may be taxable under the federal income tax or a state franchise or income tax, and assistance should be sought from a professional tax adviser.

    (c) Proceeds of the viatical settlement may be subject to the claims of creditors.

    (d) Receipt of proceeds of a viatical settlement may adversely affect the viator’s eligibility for Medicaid or other governmental benefits, and advice should be sought from the appropriate governmental agencies.

    (e) The viator has a right to terminate a viatical settlement within 15 days after his receipt of the proceeds, as provided in section 31 of this act, and if the insured dies during that period, the settlement is terminated and all proceeds must be repaid to the provider.

    (f) Money will be sent to the viator within 3 business days after the provider has received the insurer’s or group administrator’s acknowledgment that ownership of or interest in the policy has been transferred and the beneficiary has been designated.

    (g) Entering into a viatical settlement may cause other rights, including conversion and waiver of premium, that may exist under the policy to be forfeited by the viator, and assistance should be sought from a financial adviser.

    (h) A brochure is provided which describes the process of viatical settlement, in the form prescribed by the National Association of Insurance Commissioners unless the commissioner prescribes a different form.

    2.  The document in which the disclosures required by paragraphs (a) to (g), inclusive, of subsection 1 are made must also contain the following:

All medical, financial and personal information solicited or obtained by a provider or broker of viatical settlements about an insured, including his identity and that of members of his family, a spouse or other relationship, may be disclosed as necessary to effect the viatical settlement between the viator and the provider.


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ê2001 Statutes of Nevada, Page 2172 (Chapter 446, AB 618)ê

 

All medical, financial and personal information solicited or obtained by a provider or broker of viatical settlements about an insured, including his identity and that of members of his family, a spouse or other relationship, may be disclosed as necessary to effect the viatical settlement between the viator and the provider. If you are asked to provide this information, you will be asked to consent to the disclosure. Failure to consent may affect your ability to viaticate your policy. The information may be furnished to someone who buys the policy or provides money for the purchase.

 

    Sec. 27.  A provider of viatical settlements shall furnish to the viator, no later than the date the viatical settlement is signed by all parties, at least the following disclosures, conspicuously displayed in the viatical settlement or in a separate document signed by the viator and the provider or broker of viatical settlements:

    1.  The affiliation, if any, between the provider and the issuer of the policy to be viaticated.

    2.  The name, address and telephone number of the provider.

    3.  The amount and method of calculating the broker’s commission, including anything of value paid or given to the broker for placing the policy.

    4.  If the policy to be viaticated was issued as a joint policy, contains family riders or covers a life other than that of the insured under it, any possible loss of coverage on the other lives under the policy, and that the viator should consult the producer of the insurance or the issuer of the policy for advice concerning the settlement.

    5.  The monetary amount of the current death benefit payable to the provider under the policy and, if known, the availability of any other guaranteed benefit, the monetary amount of any benefit for accidental death or dismemberment, and the provider’s interest in those benefits.

    6.  The name, business address and telephone number of the escrow agent, and the right of the viator or owner to inspect or receive copies of the relevant escrow or trust agreements or related documents.

    Sec. 28.  If a provider of viatical settlements transfers ownership or changes the beneficiary of a viaticated policy, he shall inform the insured of the transfer or change within 20 days after it occurs.

    Sec. 29.  1.  A provider of viatical settlements who enters into a settlement shall first obtain:

    (a) If the viator is the insured, a written statement from a licensed attending physician that the viator is of sound mind and under no constraint or undue influence to enter into a settlement;

    (b) A witnessed document in which the viator represents that he has a full and complete understanding of the settlement and of the benefits of the policy, acknowledges that he has entered into the settlement freely and voluntarily and, if applicable to determine a payment to a person terminally or chronically ill, acknowledges that he is terminally or chronically ill and that the illness was diagnosed after the policy was issued; and

    (c) A document in which the insured consents to the release of his medical records to a provider or broker of viatical settlements and the insurer that issued the policy covering him.


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ê2001 Statutes of Nevada, Page 2173 (Chapter 446, AB 618)ê

 

    2.  Within 20 days after a viator executes documents necessary to transfer rights under a policy, or enters into an agreement in any form, express or implied, to viaticate the policy, the provider of viatical settlements shall give written notice to the issuer of the policy that the policy has or will become viaticated. The notice must be accompanied by a copy of the release of medical records and the application for the viatical settlement.

    Sec. 30.  All medical information solicited or obtained by a licensee under this chapter is subject to other laws of this state relating to the confidentiality of the information.

    Sec. 31.  A viatical settlement entered into in this state must reserve to the viator an unconditional right to terminate the settlement within 15 days after he receives the proceeds of the settlement. If the insured dies during that period, the settlement is terminated, but the proceeds must be repaid to the provider of the viatical settlement.

    Sec. 32.  1.  A provider of viatical settlements shall instruct the viator to send the executed documents required to effect the change in ownership or assignment or change of beneficiary of the affected policy to a designated independent escrow agent. Within 3 business days after the date the escrow agent receives the documents, or within 3 business days after the provider receives the documents if by mistake they are sent directly to him, the escrow agent shall deposit the proceeds of the settlement into an escrow or trust account maintained in a regulated financial institution whose deposits are insured by the Federal Deposit Insurance Corporation.

    2.  Upon deposit of the proceeds in that account, the escrow agent shall deliver to the provider the original documents executed by the viator. Upon the provider’s receipt from the insurer of an acknowledgment of the change in ownership or assignment or change of beneficiary of the affected policy, he shall instruct the escrow agent to pay the proceeds of the settlement to the viator.

    3.  Payment to the viator must be made within 3 business days after the date the provider received the acknowledgment from the insurer. Failure to make the payment within that time makes the viatical settlement voidable by the viator for lack of consideration until payment is tendered to and accepted by the viator.

    Sec. 33.  1.  Contact with an insured to determine the status of his health after a viatical settlement may be made only by a provider or broker of viatical settlements who is licensed in this state, or its authorized representative, and no oftener than once every 3 months if the insured has a life expectancy of 1 year or more, or once every month if the insured has a life expectancy of less than 1 year. The provider or broker shall explain the procedure for those contacts at the time the settlement is entered into.

    2.  The limitations of subsection 1 do not apply to contacts for purposes other than determining status of health.

    3.  A provider or broker is responsible for the acts of his authorized representative.

    Sec. 34.  1.  A viator may not enter into a viatical settlement within 2 years after the issuance of the policy to which the settlement relates unless one or more of the following conditions is or has been satisfied:

    (a) The policy was issued upon the owner’s exercise of a right of conversion arising out of a group policy.


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ê2001 Statutes of Nevada, Page 2174 (Chapter 446, AB 618)ê

 

    (b) The owner of the policy is a charitable organization exempt from taxation under 26 U.S.C. § 501(c)(3).

    (c) The owner of the policy is a business organization.

    (d) The viator or owner submits to the provider of viatical settlements independent evidence that within the 2-year period:

         (1) The owner or insured has been diagnosed to have an illness or condition that is life-threatening or requires a course of treatment for at least 2 years, long-term care or health care at home, or any combination of these;

         (2) The spouse of the owner or insured has died;

         (3) The owner or insured has divorced his spouse;

         (4) The owner or insured has retired from full-time employment;

         (5) The owner or insured has become physically or mentally disabled and a physician determines that the disability precludes him from maintaining full-time employment;

         (6) The owner of the policy was the employer of the insured and that relationship has terminated;

         (7) A final judgment or order has been entered or issued by a court of competent jurisdiction, on the application of a creditor or owner of the insured, adjudging the owner or insured bankrupt or insolvent, or approving a petition for reorganization of the owner or insured or appointing a receiver, trustee or liquidator for all or a substantial part of the assets of the owner or insured;

         (8) The owner of the policy experiences a significant decrease in income which is unexpected by him and impairs his reasonable ability to pay the premium on the policy; or

         (9) The owner or insured disposes of his ownership in a closely held corporation.

    2.  The independent evidence must be submitted to the insurer when the provider of viatical settlements submits a request to the insurer to effect transfer of the policy to him. The insurer shall respond timely to the request. This section does not prohibit an insurer from exercising its right to contest a policy on the ground of fraud.

    3.  If a provider of viatical settlements submits to an insurer a copy of the owner’s or insured’s certification that one of the events described in paragraph (d) of subsection 1 has occurred, the certification conclusively establishes that the viatical settlement is valid, and the insurer shall timely respond to the provider’s request to effect a transfer of the policy.

    Sec. 35.  Sections 35 to 43, inclusive, of this act apply to advertising of viatical settlements or related services intended for dissemination in this state, including advertising on the Internet which is viewed by persons in this state. To the extent that federal regulation establishes requirements for disclosure, those sections must be so interpreted as to eliminate or minimize conflict with the federal requirements.

    Sec. 36.  Each licensee under this chapter shall establish and continuously maintain a system of control over the content, form and method of dissemination of all advertisements of its contracts and services. Each advertisement is the responsibility of the licensee as well as the person who creates or presents it. A system of control must include notification to persons authorized by the licensee who disseminate advertisements, at least annually, of the requirements and procedures for approval before use of any advertisements not furnished by the licensee.


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ê2001 Statutes of Nevada, Page 2175 (Chapter 446, AB 618)ê

 

    Sec. 37.  An advertisement must be truthful and not misleading in fact or by implication. The form and content of an advertisement for viatical settlements must be sufficiently complete and clear to avoid deception. An advertisement may not have a capacity or tendency to mislead or deceive, as determined by the commissioner from the overall impression it may reasonably be expected to create upon a person of average education or intelligence in the segment of the public to which it is directed.

    Sec. 38.  1.  The information required to be disclosed under sections 35 to 43, inclusive, of this act may not be minimized, obscured, presented ambiguously or so intermingled with other text of an advertisement as to be confusing or misleading.

    2.  An advertisement may not omit material information or use language or illustrations if the omission or use has a capacity or tendency to, or does, mislead viators as to the nature or extent of any benefit, loss covered, premium payable or effect on federal or state taxes. Making a viatical settlement available for inspection before it is consummated, or offering to refund payment if the viator is not satisfied within the period prescribed in section 31 of this act, does not remedy misleading statements.

    3.  An advertisement may not use the name or title of an insurer or policy unless the advertisement has been approved by the insurer.

    4.  An advertisement may not state or imply that interest charged on an accelerated death benefit or loan on a policy is unfair or in any way improper.

    5.  The words “free,” “no additional cost” or words of similar import may not be used with respect to any benefit or service unless true.

    Sec. 39.  1.  A testimonial, appraisal or analysis used in an advertisement must be genuine, represent the present opinion of the author, apply to the viatical settlement advertised, if any, and be reproduced with sufficient completeness to avoid misleading viators. In using a testimonial, appraisal or analysis, a licensee under this chapter makes the statements contained his own, and the statements must satisfy the requirements of sections 35 to 43, inclusive, of this act.

    2.  If the person making a testimonial, appraisal, analysis or endorsement has a financial interest in the provider of viatical settlements or a related organization, or receives a benefit other than required wages, that fact must be prominently disclosed in the advertisement.

    3.  An advertisement may not state or imply that a viatical settlement, benefit or service has been approved or endorsed by a group, society or other organization unless that is the fact and any relationship between the organization and the provider of viatical settlements is disclosed. If the organization is owned, controlled or managed by the provider, or receives any payment or other consideration from the provider for making the endorsement or testimonial, that fact must be disclosed in the advertisement.

    4.  An advertisement may not contain statistical information unless it accurately reflects recent and relevant facts. The source of all statistics used in an advertisement must be identified.

    Sec. 40.  An advertisement may not disparage insurers, providers of insurance, other providers or brokers of viatical settlements, policies, services or methods of marketing.


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ê2001 Statutes of Nevada, Page 2176 (Chapter 446, AB 618)ê

 

    Sec. 41.  1.  The name of the provider of viatical settlements must be clearly identified in an advertisement about him or his viatical settlements. If a viatical settlement is advertised, it must be identified by number or other appropriate description. If an application is part of an advertisement, the name of the provider must be shown on the application.

    2.  An advertisement may not use a trade name, designation of a group, name of a parent or particular division of a provider of viatical settlements, service mark, slogan or other device or reference without disclosing the identity of the provider of viatical settlements licensed under this chapter if the advertisement would have the capacity or tendency to mislead as to his true identity or create the impression that an organization other than the licensee would have a responsibility for the financial obligation under a viatical settlement. The name of the licensee must be stated in all advertisements.

    Sec. 42.  1.  An advertisement may not use a combination of words, symbols or physical materials that by their content, phraseology, shape, color or other characteristic are so similar to a combination of words, symbols or physical materials used by a governmental program or agency, or otherwise appear to be of such a nature, that they tend to mislead viators into believing that the solicitation is connected with a governmental program or agency. An advertisement may not create the impression that a provider of viatical settlements, his financial condition or business practices, the payment of his claims or the merit, desirability or advisability of his viatical settlements is recommended or endorsed by a governmental authority.

    2.  An advertisement may state that a provider of viatical settlements is licensed in the state in which the advertisement appears, if it does not imply that competing providers are not so licensed. The advertisement may suggest consulting the licensee’s web site or communicating with the commissioner to ascertain whether the state requires licensing and, if so, whether a particular provider or broker of viatical settlements is licensed.

    Sec. 43.  1.  If an advertiser emphasizes the speed with which viatication will occur, the advertisement must disclose the average time from completed application to date of offer and from acceptance of offer to receipt of funds by the viator.

    2.  If an advertiser emphasizes the monetary amounts available to viators, the advertisement must disclose the average purchase price as a fraction of face value obtained by viators who contracted with the advertiser during the preceding 6 months.

    Sec. 44.  It is a category D felony, and the offender shall be punished as provided in NRS 193.130, for any person, knowingly or with intent to defraud, to do any of the following acts in order to deprive another of property or for his own pecuniary gain:

    1.  Present, cause to be presented or prepare with knowledge or belief that it will be presented, false information to or by a provider or broker of viatical settlements, a financing agent, an insurer, a provider of insurance or any other person, or to conceal information, as part of, in support of or concerning a fact material to:

    (a) An application for the issuance of a policy or viatical settlement;

    (b) The underwriting of a policy or viatical settlement;

    (c) A claim for payment or other benefit under a policy or viatical settlement;


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    (d) A premium paid on a policy;

    (e) A payment or change of beneficiary or ownership pursuant to a policy or viatical settlement;

    (f) The reinstatement or conversion of a policy;

    (g) The solicitation, offer or effectuation of a policy or viatical settlement; or

    (h) The issuance of written evidence of a policy or viatical settlement.

    2.  In furtherance of a fraud or to prevent detection of a fraud:

    (a) Remove, conceal, alter, destroy or sequester from the commissioner assets or records of a licensee under this chapter or other person engaged in the business of viatical settlements;

    (b) Misrepresent or conceal the financial condition of a licensee, a financing agent, an insurer or other person;

    (c) Transact the business of viatical settlements in violation of this chapter; or

    (d) File with the commissioner or analogous officer of another jurisdiction a document containing false information or otherwise conceal information about a material fact from the commissioner or other officer.

    3.  Present, cause to be presented or prepare with knowledge or belief that it will be presented to or by a provider or broker of viatical settlements, a financing agent, an insurer, a provider of insurance or any other person, in connection with a viatical settlement or transaction of insurance, a policy fraudulently by the insured or owner or an agent of either.

    4.  Embezzle, steal, misappropriate or convert money, premiums, credits or other property of a provider of viatical settlements, a viator, an insurer, an insured, an owner of a policy or other person engaged in the business of viatical settlements or insurance.

    5.  Attempt to commit, assist, aid, abet or conspire to commit an act or omission described in subsections 1 to 4, inclusive.

    Sec. 45.  It is unlawful knowingly or intentionally:

    1.  For any person to interfere with the enforcement of the provisions of this chapter or an investigation of a possible violation of those provisions.

    2.  For a person engaged in the business of viatical settlements to permit any person convicted of a felony involving dishonesty or breach of trust to participate in that business.

    Sec. 46.  An application or contract for a viatical settlement, however transmitted, must contain a settlement substantially as follows: “ A person who knowingly presents false information in an application for a viatical settlement is guilty of insurance fraud and subject to fine and imprisonment.” The lack of such a statement is not a defense in a prosecution for violation of section 44 of this act.

    Sec. 47.  1.  A person engaged in the business of viatical settlements who knows or reasonably believes that a violation of section 44 of this act is being, has been or will be committed shall promptly report the facts and circumstances pertaining to the violation to the commissioner.

    2.  Any other person who knows or reasonably believes that a violation of section 43 of this act is being, has been or will be committed may furnish to the commissioner the information required by the commissioner.


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    Sec. 48.  1.  Except as otherwise provided in subsection 2, a person furnishing information of the kind described in section 47 of this act is immune from liability and civil action if the information is furnished to or received from:

    (a) The commissioner or his employees, agents or representatives;

    (b) Another federal, state or local law enforcement or regulatory officer or his employees, agents or representatives;

    (c) Another person involved in the prevention or detection of violations of section 44 of this act or similar offenses or his employees, agents or representatives;

    (d) The National Association of Insurance Commissioners or other regulatory body overseeing life insurance or viatical settlements, or its employees, agents or representatives; or

    (e) The insurer that issued the policy concerned in the information.

    2.  The immunity provided in subsection 1 does not extend to a statement made with actual malice. In an action brought against a person for filing a report or furnishing other information concerning a violation of section 44 of this act, the plaintiff must plead specifically that the defendant acted with actual malice.

    3.  This section does not supplant or modify any other privilege or immunity at common law or under another statute enjoyed by a person described in subsection 1.

    Sec. 49.  1.  A document or information furnished pursuant to section 48 of this act or obtained by the commissioner in an investigation of an actual or suspected violation of section 44 of this act is confidential and privileged, is not a public record and is not subject to discovery or subpoena in a civil action or criminal prosecution.

    2.  Subsection 1 does not prohibit the commissioner from disclosing documents or evidence so furnished or obtained:

    (a) In an administrative or judicial proceeding to enforce a statute administered by him;

    (b) To another federal, state or local law enforcement or regulatory officer, another person involved in the prevention or detection of violations of section 44 of this act or similar offenses, or the National Association of Insurance Commissioners; or

    (c) To a person engaged in the business of viatical settlements who is aggrieved by the violation.

    3.  Disclosure of a document or evidence under subsection 2 does not abrogate or modify the privilege covering it under subsection 1.

    Sec. 50.  1.  Each licensee under this chapter shall establish and maintain protective measures against fraud which are reasonably calculated to prevent, detect and assist in the prosecution of violations of section 44 of this act. The commissioner may order, or a licensee may request and the commissioner may approve, modifications of the measures otherwise required under this section, more or less restrictive than those measures, as necessary to protect against fraud. Required measures are employment of or contracting with investigators and submission of a plan to the commissioner which includes:

    (a) A description of the procedures for detecting and investigating possible violations of section 44 of this act and for resolving inconsistencies between medical records and applications for insurance;


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    (b) A description of the procedures for reporting possible violations to the commissioner;

    (c) A description of the plan for educating and training underwriters and other personnel against fraud; and

    (d) A description or chart of the organizational arrangement of the personnel responsible for detecting and investigating possible violations of section 44 of this act and for resolving inconsistencies between medical records and applications for insurance.

    2.  A plan submitted to the commissioner pursuant to subsection 1 is privileged and confidential, not a public record and not subject to discovery or subpoena in a civil action or criminal prosecution.

    Sec. 51.  1.  In addition to the penalties and other means of enforcement provided under this chapter:

    (a) If a person violates a provision of this chapter or of a regulation adopted under this chapter, the commissioner may seek an injunction and apply for temporary and permanent orders he determines to be necessary to restrain the violator.

    (b) A person who violates a provision of this chapter is subject to an administrative fine of not more than $1,000 for each violation.

    (c) In addition to a criminal penalty imposed, the court shall order restitution to the person aggrieved by the violation.

    2.  A person aggrieved by a violation of this chapter may bring a civil action against the violator to recover the damages suffered.

    Sec. 52.  The commissioner may adopt regulations to:

    1.  Establish standards for evaluating the reasonableness of payments under viatical settlements to persons chronically or terminally ill, including the regulation of the rates of discount used to determine the amount paid in exchange for an assignment, transfer, sale or devise of a benefit under a policy.

    2.  Require a bond or otherwise ensure financial accountability of providers and brokers of viatical settlements.

    3.  Govern the relationship of insurers with providers and brokers of viatical settlements during the viatication of a policy.

    Sec. 53.  Chapter 679A of NRS is hereby amended by adding thereto the provisions set forth as sections 54 and 55 of this act.

    Sec. 54.  “Producer of insurance” means a person required to be licensed under the laws of this state to sell, solicit or negotiate insurance.

    Sec. 55.  “Provider of insurance” includes an insurer, producer of insurance, managing general agent, third party administrator, organization composed of or using preferred providers of health care, health maintenance organization, commercial bank, trust company, savings and loan association, credit union, thrift company, financial holding company, affiliate or subsidiary of an insurer or financial holding company, broker-dealer in securities, mortgage lender, and any other person engaged in the business of insurance.

    Sec. 56.  NRS 679A.020 is hereby amended to read as follows:

    679A.020  As used in this code, unless the context otherwise requires, the words and terms defined in NRS 679A.030 to 679A.130, inclusive, and sections 54 and 55 of this act have the meanings ascribed to them in those sections.


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    Sec. 57.  Chapter 679B of NRS is hereby amended by adding thereto the provisions set forth as sections 58 and 59 of this act.

    Sec. 58.  1.  The commissioner shall adopt regulations governing:

    (a) The use of electronic signatures, and the acceptance and transmission of electronic records, in transactions relating to insurance; and

    (b) The electronic filing of forms and payment of fees, and the storage and reproduction of records, filed with the division.

    2.  As used in this section:

    (a) “Electronic” means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities.

    (b) “Electronic record” means a record created, generated, sent, communicated, received or stored by electronic means.

    (c) “Electronic signature” means an electronic sound, symbol or process attached to or logically associated with a record and executed or adopted by a person with the intent to sign the record.

    (d) “Record” means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

    (e) “Transaction” means an action or set of actions occurring between two or more persons relating to the transaction of business, commercial or governmental affairs.

    Sec. 59.  The commissioner may adopt regulations, not inconsistent with any provision of NRS, to enforce the provisions of any federal law enacted after January 1, 2001, concerning a bill of rights for patients.

    Sec. 60.  NRS 679B.090 is hereby amended to read as follows:

    679B.090  1.  The commissioner may employ such other technical, actuarial, rating, clerical and other assistants and examiners as he may reasonably require for execution of his duties, each of whom must be in the classified service of the state.

    2.  The commissioner may contract for and procure services of examiners and other or additional specialized technical or professional assistance, as independent contractors or for a fee, as he may reasonably require. None of the persons providing those services or assistance on [a] contract or for a fee [basis] may be in the classified service of the state.

    3.  The commissioner may contract with a person outside the division for administering examinations, processing applications for licenses, and collecting fees.

    4.  The commissioner may adopt regulations to carry out the provisions of subsections 2 and 3.

    Sec. 61.  NRS 679B.150 is hereby amended to read as follows:

    679B.150  1.  The commissioner may:

    (a) Take measures to enhance the public understanding of insurance coverages purchased by consumers and encourage price competition among insurers and a public understanding of the standards promulgated under paragraph (b).

    (b) Develop, promulgate and revise as he deems appropriate, standards in each of the several areas of insurance appropriate to be applied to policies sold in the State of Nevada. The standards [shall] must seek to ensure that policies [shall not be] are not unjust, unfair, inequitable, unfairly discriminatory, misleading, deceptive, obscure or encourage misrepresentation or misunderstanding of the contract.


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    (c) Develop criteria to determine the suitability of insurance contracts and the practices used in the sale of insurance.

    2.  [Nothing in this section shall] This section does not prohibit an insurer from offering policies encompassing standards more favorable to the insured than those promulgated under this section.

    Sec. 62.  NRS 679B.152 is hereby amended to read as follows:

    679B.152  1.  Every insurer or organization for dental care which pays claims on the basis of fees for medical or dental care which are “usual and customary” shall submit to the commissioner a complete description of the method it uses to determine those fees. This information must be kept confidential by the commissioner. The fees determined by the insurer or organization to be the usual and customary fees for that care are subject to the approval of the commissioner as being the usual and customary fees in that locality. The provisions of this subsection apply to medical or dental care provided to a claimant under any contract of insurance.

    2.  Any contract for group, blanket or individual health insurance and any contract issued by a nonprofit hospital, medical or dental service corporation or organization for dental care, which provides a plan for dental care to its insureds or members which limits their choice of a dentist, under the plan to those in a preselected group, must offer its insureds or members the option of selecting a plan of benefits which does not restrict the choice of a dentist. The selection of that option does not entitle the insured or member to any increase in contributions by his employer or other organization toward the premium or cost of the optional plan over that contributed under the restricted plan.

    Sec. 63.  NRS 679B.190 is hereby amended to read as follows:

    679B.190  1.  The commissioner shall carefully preserve in the division and in permanent form all papers and records relating to the business and transactions of the division and shall hand them over to his successor in office.

    2.  Except as otherwise provided in subsections 3 [, 5 and 6,] and 5 to 9, inclusive, other provisions of this code and NRS 616B.015, the papers and records must be open to public inspection.

    3.  Any records or information in the possession of the division related to an investigation conducted by the commissioner is confidential unless:

    (a) The commissioner releases, in the manner that he deems appropriate, all or any part of the records or information for public inspection after determining that the release of the records or information:

         (1) Will not harm his investigation or the person who is being investigated; or

         (2) Serves the interests of a policyholder, the shareholders of the insurer or the public; or

    (b) A court orders the release of the records or information after determining that the production of the records or information will not damage any investigation being conducted by the commissioner.

    4.  The commissioner may destroy unneeded or obsolete records and filings in the division in accordance with provisions and procedures applicable in general to administrative agencies of this state.

    5.  The commissioner may classify as confidential [certain] :

    (a) Specified records and information obtained from a governmental agency [or] ;


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    (b) Documents obtained or received from other sources upon the express condition that they remain confidential.

    6.  All information and documents in the possession of the division or any of its employees which are related to cases or matters under investigation by the commissioner or his staff are confidential for the period of the investigation and may not be made public unless the commissioner finds the existence of an imminent threat of harm to the safety or welfare of the policyholder, shareholders or the public and determines that the interests of the policyholder, shareholders or the public will be served by publication thereof, in which event he may make a record public or publish all or any part of the record in any manner he deems appropriate.

    7.  The commissioner may classify as confidential the records of a consumer or information relating to a consumer to protect the health, welfare or safety of the consumer.

    8.  In performing his duties, the commissioner may:

    (a) Share documents, materials or other information, including any documents, materials or information classified as confidential, with other state, federal and international regulatory or law enforcement agencies or with the National Association of Insurance Commissioners and its affiliates and subsidiaries if the recipient agrees to maintain the confidentiality and privileged status of the documents, materials or other information.

    (b) May receive documents, materials or other information, including any documents, materials or information otherwise confidential and privileged, from other state, federal and international regulatory or law enforcement agencies or from the National Association of Insurance Commissioners and its affiliates and subsidiaries, and shall maintain as confidential or privileged any document, material or information received with notice or the understanding that it is confidential or privileged under the law of the jurisdiction from which it was received.

    (c) Enter into agreements, consistent with this subsection, governing the sharing and use of information.

    9.  No waiver of confidentiality or privilege with respect to any document, material or information occurs as a result of disclosure to the commissioner under this section or of sharing as authorized under this chapter.

    Sec. 64.  NRS 679B.220 is hereby amended to read as follows:

    679B.220  1.  The commissioner shall communicate on request of the regulatory officer for insurance [supervisory official of] in any state, province or country any information which it is his duty by law to ascertain respecting authorized insurers.

    2.  The commissioner may:

    (a) Be a member of the National Association of Insurance Commissioners or any successor organization;

    (b) Exchange with the association or any successor organization any information, not otherwise confidential, relating to applicants and licensees under this Title;

    (c) Communicate with the association or any successor organization concerning the business of insurance generally; [and]

    (d) Enter into compacts with the regulatory officers in other states to further the uniform treatment of insurers throughout the United States; and


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    (e) Participate in and support other cooperative activities of public officers having supervision of the business of insurance.

    Sec. 65.  NRS 679B.510 is hereby amended to read as follows:

    679B.510  As used in NRS 679B.510 to 679B.560, inclusive, and section 59 of this act, unless the context otherwise requires, the words and terms defined in NRS 679B.520, 679B.530 and 679B.540 have the meanings ascribed to them in those sections.

    Sec. 66.  NRS 680A.320 is hereby amended to read as follows:

    680A.320  1.  For the purposes of this section:

    (a) An “affiliated person” is a person controlled by any combination of the insurer, the parent corporation, a subsidiary or the principal stockholders or officers or directors of any of the foregoing.

    (b) “Depository institution” has the meaning ascribed to it in section 3 of the Federal Deposit Insurance Act, 12 U.S.C. § 1813(c)(1).

    (c) “Financial holding company” means a bank holding company that satisfies the requirements of section 4(l)(1) of the Bank Holding Company Act of 1956, 12 U.S.C. § 1841(l)(1).

    (d) “Health facility” has the meaning ascribed to it in NRS 439A.015.

    [(c)] (e) A “subsidiary” is a person of which either the insurer and the parent corporation or the insurer or the parent corporation holds practical control.

    2.  No insurer may engage directly or indirectly in any transaction or agreement with its parent corporation, a financial holding company, a depository institution, or [with] any subsidiary or affiliated person which will result or tend to result in:

    (a) Substitution contrary to the interest of the insurer and through any method of any asset of the insurer with an asset or assets of inferior quality or lower fair market value;

    (b) Deception as to the true operating results of the insurer;

    (c) Deception as to the true financial condition of the insurer;

    (d) Allocation to the insurer of a proportion of the expense of combined facilities or operations which is unfair and unfavorable to the insurer;

    (e) Unfair or excessive charges against the insurer for services, facilities, supplies or reinsurance;

    (f) Unfair and inadequate charges by the insurer for reinsurance, services, facilities or supplies furnished by the insurer to others;

    (g) Payment by the insurer for services, facilities, supplies or reinsurance not reasonably needed by the insurer;

    (h) Depletion of the insurer’s surplus, through payment of dividends or other distribution or withdrawal, below the amount thereof reasonably required for conduct of the insurer’s business and maintenance of growth with safety to policyholders; or

    (i) Payment by the insurer for services or products for which the health facility has charged less than fair market value, unless the reduced charge is reflected in the form of reduced premiums. In determining what constitutes fair market value, consideration must be given to reasonable agreements for the preferential provision of health care, in accordance with regulations adopted by the commissioner. An insurer which pays less than fair market value for services or products in a transaction which is subject to the provisions of this paragraph shall annually file a certification with the commissioner that the reduced payment has been reflected in the form of reduced premiums, together with documentation supporting the certification.


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    3.  In all transactions between the insurer and its parent corporation, or involving the insurer and any subsidiary or affiliated person, full recognition must be given to the paramount duty and obligation of the insurer to protect the interests of policyholders, both existing and future.

    4.  If a health facility is a parent, subsidiary or affiliate of an insurer or of a parent or facility of an insurer, and the insurer purchases medical or any other services or products from the health facility, the health facility may not:

    (a) Attempt artificially to reduce or increase its margin of profit by altering the charges to the insurer.

    (b) Alter its true operating results or financial condition through charges to the insurer for services or products.

This subsection does not prohibit activities authorized pursuant to paragraph (i) of subsection 2.

    5.  If a health facility is found, after notice and a hearing, to have violated the provisions of subsection 4, the commissioner may impose an administrative fine of not more than $5,000 for each violation.

    Sec. 67.  NRS 680B.010 is hereby amended to read as follows:

    680B.010  The commissioner shall collect in advance and receipt for, and persons so served must pay to the commissioner, fees and miscellaneous charges as follows:

    1.  Insurer’s certificate of authority:

    (a) Filing initial application.............................................................................................................. $2,450

    (b) Issuance of certificate:

         (1) For any one kind of insurance as defined in NRS 681A.010 to 681A.080, inclusive..... 283

         (2) For two or more kinds of insurance as so defined................................................................. 578

         (3) For a reinsurer............................................................................................................................ 2,450

    (c) Each annual continuation of a certificate................................................................................ 2,450

    (d) Reinstatement pursuant to NRS 680A.180, 50 percent of the annual continuation fee otherwise required.

    (e) Registration of additional title pursuant to NRS 680A.240........................................................ 50

    (f) Annual renewal of the registration of additional title pursuant to NRS 680A.240................. 25

    2.  Charter documents, other than those filed with an application for a certificate of authority. Filing amendments to articles of incorporation, charter, bylaws, power of attorney and other constituent documents of the insurer, each document............................................................................................. $10

    3.  Annual statement or report. For filing annual statement or report ......................................... $25

    4.  Service of process:

    (a) Filing of power of attorney................................................................................................................ $5

    (b) Acceptance of service of process..................................................................................................... 30

    5.  [Agents’ licenses,] Licenses, appointments and renewals [:] for producers of insurance:

    (a) [Resident agents and nonresident agents qualifying under subsection 3 of NRS 683A.340:

         (1)] Application and license................................................................................................ [$78] $125

         [(2) Appointment by]

    (b) Appointment fee for each insurer.............................................................................................. [5] 15

         [(3)] (c) Triennial renewal of each license............................................................................. [78] 125

         [(4)] (d) Temporary license................................................................................................................. 10

    [(b) Other nonresident agents:


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         (1) Application and license .............................................................................................................. 138

         (2) Appointment by each insurer....................................................................................................... 25

         (3) Triennial renewal of each license.............................................................................................. 138

    6.  Brokers’ licenses and renewals:

    (a) Resident brokers and nonresident brokers qualifying under subsection 3 of NRS 683A.340:

         (1) Application and license .............................................................................................................. $78

         (2) Triennial renewal of each license................................................................................................ 78

    (b) Other nonresident brokers:

         (1) Application and license .............................................................................................................. 258

         (2) Triennial renewal of each license.............................................................................................. 258

    (c) Resident surplus]

    (e) Modification of an existing license................................................................................................ 50

    6.  Surplus lines brokers:

         [(1)] (a) Application and license .......................................................................................... [78] $125

         [(2)] (b) Triennial renewal of each license............................................................................. [78] 125

    [(d) Nonresident surplus lines brokers:

         (1) Application and license............................................................................................................... 258

         (2) Triennial renewal of each license.............................................................................................. 258

    7.  Solicitors’ licenses, appointments and renewals:

    (a) Application and license .................................................................................................................. $78

    (b) Triennial renewal of each license..................................................................................................... 78

    (c) Initial appointment............................................................................................................................... 5

    8.] 7.  Managing general agents’ licenses, appointments and renewals:

    (a) [Resident managing general agents:

         (1)] Application and license ............................................................................................... [$78] $125

         [(2) Initial appointment,]

    (b) Appointment fee for each insurer.............................................................................................. [5] 15

         [(3)] Triennial renewal of each license................................................................................... [78] 125

    [(b) Nonresident managing general agents:

         (1) Application and license............................................................................................................... 138

         (2) Initial appointment, each insurer................................................................................................ 25

         (3) Triennial renewal of each license.............................................................................................. 138

    9.] 8.  Adjusters’ licenses and renewals:

    (a) Independent and public adjusters:

         (1) Application and license ................................................................................................. [$78] $125

         (2) Triennial renewal of each license...................................................................................... [78] 125

    (b) Associate adjusters:

         (1) Application and license ..................................................................................................... [78] 125

         (2) [Initial appointment......................................................................................................................... 5

         (3)] Triennial renewal of each license.................................................................................... [78] 125

    [10.] 9.  Licenses and renewals for appraisers of physical damage to motor vehicles:

    (a) Application and license ..................................................................................................... [$78] $125

    (b) Triennial renewal of each license.......................................................................................... [78] 125

    [11.] 10.  Additional title and property insurers pursuant to NRS 680A.240:

    (a) Original registration.......................................................................................................................... $50

    (b) Annual renewal................................................................................................................................... 25

    [12.] 11.  Insurance vending machines:

    (a) Application and license, for each machine..................................................................... [$78] $125


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    (b) Triennial renewal of each license.......................................................................................... [78] 125

    [13.] 12.  Permit for solicitation for securities:

    (a) Application for permit................................................................................................................... $100

    (b) Extension of permit............................................................................................................................ 50

    [14.] 13.  Securities salesmen for domestic insurers:

    (a) Application and license .................................................................................................................. $25

    (b) Annual renewal of license................................................................................................................. 15

    [15.] 14.  Rating organizations:

    (a) Application and license ................................................................................................................ $500

    (b) Annual renewal................................................................................................................................. 500

    [16.] 15.  Certificates and renewals for administrators licensed pursuant to chapter 683A of NRS:

    (a) [Resident administrators:

         (1)] Application and certificate of registration ............................................................... [$78] $125

         [(2)] (b) Triennial renewal......................................................................................................... [78] 125

    [(b) Nonresident administrators:

         (1) Application and certificate of registration .............................................................................. 138

         (2) Triennial renewal.......................................................................................................................... 138

    17.] 16.  For copies of the insurance laws of Nevada, a fee which is not less than the cost of producing the copies.

    [18.] 17.  Certified copies of certificates of authority and licenses issued pursuant to the insurance code   $10

    [19.] 18.  For copies and amendments of documents on file in the division, a reasonable charge fixed by the commissioner, including charges for duplicating or amending the forms and for certifying the copies and affixing the official seal.

    [20.] 19.  Letter of clearance for [an agent or broker] a producer of insurance or other licensee, if requested by someone other than the licensee..................................................................................... $10

    [21.] 20.  Certificate of status as a [licensed agent or broker] producer of insurance or other licensee, if requested by someone other than the licensee..................................................................................... $10

    [22.] 21.  Licenses, appointments and renewals for bail agents:

    (a) Application and license ..................................................................................................... [$78] $125

    (b) [Initial appointment by] Appointment for each surety insurer............................................ [5] 15

    (c) Triennial renewal of each license........................................................................................... [78] 125

    [23.] 22.  Licenses and renewals for bail enforcement agents:

    (a) Application and license ..................................................................................................... [$78] $125

    (b) Triennial renewal of each license.......................................................................................... [78] 125

    [24.] 23.  Licenses, appointments and renewals for general [bail agents:] agents for bail:

    (a) Application and license ..................................................................................................... [$78] $125

    (b) Initial appointment by each insurer.......................................................................................... [5] 15

    (c) Triennial renewal of each license........................................................................................... [78] 125

    [25.] 24.  Licenses and renewals for bail solicitors:

    (a) Application and license ..................................................................................................... [$78] $125

    (b) Triennial renewal of each license.......................................................................................... [78] 125

    [26.] 25.  Licenses and renewals for title agents and escrow officers:

    (a) [Resident title agents and escrow officers:

         (1)] Application and license ............................................................................................... [$78] $125

         [(2)] (b) Triennial renewal of each license............................................................................. [78] 125


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ê2001 Statutes of Nevada, Page 2187 (Chapter 446, AB 618)ê

 

    [(b) Nonresident title agents and escrow officers:

         (1) Application and license .............................................................................................................. 138

         (2) Triennial renewal of each license............................................................................................. 138]

    (c) Appointment fee for each title insurer........................................................................................... 15

    (d) Change in name or location of business or in association.......................................................... 10

    [27.] 26.  Certificate of authority and renewal for a seller of prepaid funeral contracts [$78] $125

    [28.] 27.  Licenses and renewals for agents for prepaid funeral contracts:

    (a) [Resident agents:

         (1)] Application and license ............................................................................................... [$78] $125

         [(2)] (b) Triennial renewal of each license............................................................................. [78] 125

    [(b) Nonresident agents:

         (1) Application and license............................................................................................................... 138

         (2) Triennial renewal of each license.............................................................................................. 138

    29.] 28.  Licenses, appointments and renewals for agents for fraternal benefit societies:

    (a) [Resident agents:

         (1)] Application and license ............................................................................................... [$78] $125

         [(2) Appointment.................................................................................................................................... 5

         (3)] (b) Appointment for each insurer.............................................................................................. 15

    (c) Triennial renewal of each license........................................................................................... [78] 125

    [(b) Nonresident agents:

         (1) Application and license............................................................................................................... 138

         (2) Triennial renewal of each license.............................................................................................. 138

    30.] 29.  Reinsurance intermediary broker or manager:

    (a) [Resident agents:

         (1)] Application and license ............................................................................................... [$78] $125

         [(2)] (b) Triennial renewal of each license ............................................................................ [78] 125

    [(b) Nonresident agents:

         (1) Application and license .............................................................................................................. 138

         (2) Triennial renewal of each license ............................................................................................. 138

    31.] 30.  Agents for and sellers of prepaid burial contracts:

    (a) [Resident agents and sellers:

         (1)] Application and certificate or license......................................................................... [$78] $125

         [(2)] (b) Triennial renewal......................................................................................................... [78] 125

    [(b) Nonresident agents and sellers:

         (1) Application and certificate or license....................................................................................... 138

         (2) Triennial renewal.......................................................................................................................... 138

    32.] 31.  Risk retention groups:

    (a) Initial registration and review of an application................................................................... $2,450

    (b) Each annual continuation of a certificate of registration...................................................... 2,450

    [33.] 32.  Required filing of forms:

    (a) For rates and policies....................................................................................................................... $25

    (b) For riders and endorsements............................................................................................................. 10

    33.  Viatical settlements:

    (a) Provider of viatical settlements:

         (1) Application and license....................................................................................................... $1,000

         (2) Annual renewal........................................................................................................................ 1,000

    (b) Broker of viatical settlements:

         (1) Application and license............................................................................................................. 500

         (2) Annual renewal........................................................................................................................... 500


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ê2001 Statutes of Nevada, Page 2188 (Chapter 446, AB 618)ê

 

    34.  Insurance consultants:

    (a) Application and license............................................................................................................... $125

    (b) Triennial renewal............................................................................................................................ 125

    35.  Licensee’s association with or appointment or sponsorship by an organization:

    (a) Initial appointment, association or sponsorship, for each organization............................. $50

    (b) Renewal of each association or sponsorship............................................................................... 50

    (c) Annual renewal of appointment...................................................................................................... 15

    Sec. 68.  NRS 682A.100 is hereby amended to read as follows:

    682A.100  1.  An insurer may invest in preferred or guaranteed stocks or shares of any solvent institution existing under the laws of the United States of America, Canada or Mexico, or of any state or province thereof, if all of the prior obligations and prior preferred stocks, if any, of [such] the institution at the date of acquisition of the investment by the insurer are eligible as investments under this chapter and if the net earnings of [such] the institution available for its fixed charges during either of the last 2 years have been, and during each of the last 5 years have averaged, not less than 1 1/2 times the sum of its average annual fixed charges, if any, its average annual maximum contingent interest, if any, and its average annual preferred dividend requirements. For the purposes of this section [such computation shall refer] the computation refers to the fiscal years immediately preceding the date of acquisition of the investment by the insurer, and the term “preferred dividend requirement” [shall be deemed to mean] means cumulative or noncumulative dividends, whether paid or not.

    2.  No insurer [shall] may invest in any such preferred or guaranteed stocks in an amount in excess of [10] 35 percent of [any issue or such] the particular issue of guaranteed or preferred [stocks] stock or, subject to subsection 1 of NRS 682A.050 [(diversification),] more than an amount equal to 10 percent of the insurer’s admitted assets in any one issue.

    Sec. 69.  NRS 682A.110 is hereby amended to read as follows:

    682A.110  1.  An insurer may invest up to [25] 35 percent of its assets in nonassessable [(except as to bank or trust company stocks, and except for taxes)] common stocks, other than insurance stocks, of any solvent corporation organized and existing under the laws of the United States of America, Canada or Mexico, or of any state or province thereof, except that bank or trust company stocks may be assessable and any stocks may be assessable for taxes, if [such] the corporation has had net earnings available for dividends on [such] the stock in each of the 5 fiscal years next preceding acquisition by the insurer. If the issuing corporation has not been in legal existence for [the whole of such] all of the 5 fiscal years but was formed as a consolidation or merger of two or more businesses of which at least one was in operation on a date 5 years [prior to] before the investment, the test of eligibility of its common stock under this section [shall] must be based upon consolidated pro forma statements of the predecessor or constituent institutions.

    2.  Any amount invested in a fund or trust under NRS 682A.140 must not be included in computing the amounts prescribed in subsection 1.


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ê2001 Statutes of Nevada, Page 2189 (Chapter 446, AB 618)ê

 

    Sec. 70.  NRS 682A.130 is hereby amended to read as follows:

    682A.130  1.  An insurer may invest in the stock of [its] a subsidiary insurance corporation formed or acquired by it, or in the stock of [its] a subsidiary business corporation [or corporations] formed and engaged solely in any one or more of the following businesses:

    (a) [In any] A business necessary and incidental to the convenient operation of the insurer’s insurance business or to the administration of any of its lawful affairs;

    (b) Providing any actuarial, computer, data processing, accounting, claims, appraisal, collection, sales, loss prevention or safety engineering and similar services;

    (c) Real property management and development;

    (d) Premium financing;

    (e) Financing of agents of the insurer;

    (f) Acting as investment adviser and principal underwriter or investment adviser or principal underwriter of a management company or management companies (mutual funds), registered as such under the Investment Company Act of 1940;

    (g) Financial and investment counseling services;

    (h) Administration of self-insurance plans;

    (i) Administration of self-insured pension and similar plans, or the self-insured portions of such plans;

    (j) Securities broker-dealer;

    (k) Escrow services; [or]

    (l) Trust services with respect to funds payable or paid by it under its insurance contracts [.] ;

    (m) Bank, savings and loan association or thrift company; or

    (n) Insurance agency.

    2.  For the purposes of this section a “subsidiary” is a corporation of which the insurer owns sufficient stock to give it effective control.

    3.  All of the insurer’s investments under this section shall be deemed to be common stocks for the purposes of the [25-percent-of-assets] limitation imposed by NRS 682A.110 [.] on the percentage of admitted assets which may be invested in common stock.

    Sec. 71.  NRS 682A.190 is hereby amended to read as follows:

    682A.190  An insurer may invest in share or savings accounts of thrift companies, credit unions or savings and loan associations, or in savings accounts of banks, and in any one such institution only to the extent that the investment is insured by the Federal Deposit Insurance Corporation, the National Credit Union Share Insurance Fund or a private insurer approved pursuant to NRS 677.247 or 678.755.

    Sec. 72.  NRS 682A.200 is hereby amended to read as follows:

    682A.200  1.  An insurer may make loans or investments not otherwise expressly permitted under this chapter, in an aggregate amount not over [5] 10 percent of the insurer’s admitted assets and not over 1 percent of [such] those assets as to any one such loan or investment, if [such] the loan or investment fulfills the requirements of NRS 682A.030 and otherwise qualifies as a sound investment. No such loan or investment [shall] may be represented by:

    (a) Any item described in NRS 681B.020 , [(assets not allowed),] or any loan or investment otherwise expressly prohibited.


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ê2001 Statutes of Nevada, Page 2190 (Chapter 446, AB 618)ê

 

    (b) Agents’ balances, or amounts advanced to or owing by agents, except as to policy loans, mortgage loans and collateral loans otherwise authorized under this chapter.

    (c) Any category of loans or investments expressly eligible under any other provision of this chapter.

    (d) Any asset [theretofore] acquired or held by the insurer under any other category of loans or investments eligible under this chapter.

    2.  The insurer shall keep a separate record of all loans and investments made under this section.

    Sec. 73.  NRS 682A.240 is hereby amended to read as follows:

    682A.240  1.  A domestic insurer may invest in real property only if used for the purposes or acquired in any manner, and within limits, set forth below:

    (a) The building in which it has its principal office, the land upon which the building stands, and such other real property as may be requisite for the insurer’s convenient accommodation in the transaction of its business. The amount so invested, and apportioned as to space actually so occupied or used, must not aggregate more than 15 percent of the insurer’s assets; but the commissioner may authorize an insurer to increase the investment in such amount as he may determine if, upon proper showing made upon a hearing held by him, he finds that the 15-percent limitation is insufficient to provide reasonable and convenient accommodation for the insurer’s business.

    (b) Real property acquired in satisfaction or part payment of loans, mortgages, liens, judgments, decrees or debts previously owing to the insurer in the due course of its business.

    (c) Real property acquired in part payment of the consideration on the sale of other real property owned by it, if [such] the transaction has effected a net reduction in the insurer’s investments in real property.

    (d) Real property acquired by gift or devise, or through merger, consolidation or bulk reinsurance of another insurer under this code.

    (e) Additional real property and equipment incidental thereto, if necessary or convenient for the purpose of enhancing the sale or other value of real property previously acquired or held under this section. [Such] The additional real property and equipment, together with the real property for the enhancement of which it was acquired, must be included together, for the purpose of applicable investment limits, and is subject to disposal under NRS 682A.250 at the same time and under the same conditions as apply to [such] the enhanced real property.

    (f) Real property, or any interest therein, acquired or held by purchase, lease or otherwise, other than real property to be used primarily for mining, development of oil or mineral resources, recreational, amusement, hotel, motel or club purposes, acquired as an investment for production of income, or acquired to be improved or developed for investment purposes pursuant to an existing program therefor. The insurer may hold, mortgage, improve, develop, maintain, manage, lease, sell, convey and otherwise dispose of real property acquired by it under this section. An insurer [shall] may not have at any one time invested in real property under this paragraph more than [15] 20 percent of its admitted assets.

    2.  Total investments of the insurer in real property under this section [must] may not at any time exceed [25] 35 percent of the insurer’s admitted assets.


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ê2001 Statutes of Nevada, Page 2191 (Chapter 446, AB 618)ê

 

    Sec. 74.  Chapter 683A of NRS is hereby amended by adding thereto the provisions set forth as sections 75 to 99, inclusive, of this act.

    Sec. 75.  “Business organization” means a corporation, association, partnership, limited liability company, limited liability partnership or other legal form of organization.

    Sec. 76.  “Home state” means the District of Columbia or any state or territory of the United States or Canada in which a producer of insurance maintains his principal place of residence or principal place of business and is licensed to act as a producer of insurance.

    Sec. 77.  “License” means a document issued by the commissioner authorizing a person to act as a producer of insurance for the lines of authority specified in the document.

    Sec. 78.  “Negotiate” means to confer directly with, or offer advice directly to, a purchaser or prospective purchaser of a particular contract of insurance concerning any of the substantive benefits, terms or conditions of the contract, if the person conferring or offering the advice sells insurance or obtains insurance from insurers or purchasers.

    Sec. 79.  (Deleted by amendment.)

    Sec. 80.  “Sell” means to exchange a contract of insurance, by any means, for money or its equivalent on behalf of an insurer.

    Sec. 81.  “Solicit” means to attempt to sell insurance or to ask or urge a person to apply for a particular kind of insurance from a particular insurer.

    Sec. 82.  “Terminate” means to cancel the relationship between a producer of insurance and the insurer or to terminate a producer’s authority to transact insurance.

    Sec. 83.  “Uniform application” means the uniform application for licensing of producers of insurance prepared by the National Association of Insurance Commissioners and adopted by the commissioner.

    Sec. 84.  1.  A person shall not sell, solicit or negotiate insurance in this state for any class of insurance unless he is licensed for that class of insurance.

    2.  An insurer is exempt from the requirement for licensure as a producer of insurance, but this exemption does not extend to an insurer’s officers, directors, employees, subsidiaries or affiliates.

    3.  A person required to be licensed in this state who transacts insurance without a license is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 85.  The following persons need not be licensed as producers of insurance:

    1.  An officer, director or employee of an insurer or of a producer of insurance if the officer, director or employee does not receive any commission on policies written or sold to insure risks residing, located or to be performed in this state and:

    (a) The officer, director or employee’s activities are executive, administrative, managerial, clerical or a combination of these, and are only indirectly related to the sale, solicitation or negotiation of insurance;

    (b) The officer, director or employee’s function relates to underwriting, control of losses, inspection or the processing, adjusting, investigating or settling of claims on contracts of insurance; or


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ê2001 Statutes of Nevada, Page 2192 (Chapter 446, AB 618)ê

 

    (c) The officer, director or employee is acting in the capacity of a special agent or supervisor of an agency assisting producers of insurance where his activities are limited to providing technical advice and assistance to licensed producers and do not include sale, solicitation or negotiation of insurance.

    2.  A person who secures and furnishes information for the purpose of group life insurance, group property and casualty insurance, group annuities, or group or blanket accident and health insurance, or for the purpose of enrolling natural persons under plans, issuing certificates under plans or otherwise assisting in administering plans, or who performs administrative services related to mass marketed property and casualty insurance, if no commission is paid to him for the service. As used in this subsection, “blanket accident and health insurance” has the meaning ascribed to it in NRS 689B.070.

    3.  An employer or association or its officers, directors or employees, or the trustees of an employees’ trust plan, to the extent that the employer, association, officers, directors, employees or trustees are engaged in the administration or operation of a program of employees’ benefits for the employer’s or association’s own employees or the employees of its subsidiaries or affiliates, if the program involves the use of insurance issued by an insurer and the employer, association, officers, directors, employees or trustees are not compensated by the insurer issuing the contracts.

    4.  Employees of insurers or organizations employed by insurers who are engaged in the inspection, rating or classification of risks or in the supervision of the training of producers of insurance and are not individually engaged in the sale, solicitation or negotiation of insurance.

    5.  A person whose activities in this state are limited to advertising, without the intent to solicit insurance in this state, through communications in printed publications or electronic mass media whose distribution is not limited to residents of this state, if he does not sell, solicit or negotiate insurance of risks residing, located or to be performed in this state.

    6.  A salaried full-time employee who counsels or advises his employer concerning the interests of the employer, or of the subsidiaries or affiliates of the employer, in insurance, if the employee does not sell or solicit insurance or receive a commission.

    7.  An employee of a producer of insurance or an insurer who responds to requests from holders of policies previously issued, if the employee is not directly compensated according to the volume of premiums that may result from those services and does not solicit insurance or offer advice concerning terms or conditions of policies.

    Sec. 86.  1.  A resident natural person applying for a license as a producer of insurance must pass a written examination unless exempt under section 90 of this act. The examination must test his knowledge concerning the lines of authority for which application is made, the duties and responsibilities of a producer and the laws and regulations of this state relating to insurance. The commissioner shall adopt regulations for developing and conducting examinations required by this section.

    2.  The commissioner may contract with a person outside the division for administering examinations, processing applications, collecting fees and performing any other functions he considers appropriate.


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ê2001 Statutes of Nevada, Page 2193 (Chapter 446, AB 618)ê

 

    3.  Each natural person applying for an examination shall pay a nonrefundable fee in an amount prescribed by the commissioner to defray the cost of processing the application and administering the examination.

    4.  An applicant who fails to appear for the examination as scheduled or fails to pass the examination must reapply for examination and pay the required fee in order to be scheduled for another examination.

    Sec. 87.  1.  The commissioner shall prescribe the form of application by a natural person for a license as a resident producer of insurance. The applicant must declare, under penalty of refusal to issue, or suspension or revocation of, the license, that the statements made in the application are true, correct and complete to the best of his knowledge and belief. Before approving the application, the commissioner must find that the applicant has:

    (a) Attained the age of 18 years;

    (b) Not committed any act that is a ground for refusal to issue, or suspension or revocation of, a license;

    (c) Completed a course of study for the lines of authority for which application is made, unless the applicant is exempt from this requirement;

    (d) Paid the fee prescribed for the license and a fee of $15 for deposit in the insurance recovery account, neither of which may be refunded; and

    (e) Successfully passed the examinations for the lines of authority for which application is made, unless the applicant is exempt from this requirement.

    2.  A business organization must be licensed as a producer of insurance in order to act as such. Application must be made on a form prescribed by the commissioner. Before approving the application, the commissioner must find that the applicant has:

    (a) Paid the fee prescribed for the license and a fee of $15 for deposit in the insurance recovery account, neither of which may be refunded; and

    (b) Designated a natural person licensed as a producer of insurance to be responsible for the organization’s compliance with the laws and regulations of this state relating to insurance.

    3.  A natural person who is a resident of this state applying for a license must furnish a copy of a search concerning him conducted by the Federal Bureau of Investigation in its national criminal records, and of a search concerning him of the central repository for Nevada records of criminal history. The commissioner shall adopt regulations concerning the procedures for obtaining this information.

    4.  The commissioner may require any document reasonably necessary to verify information contained in an application.

    Sec. 88.  1.  Unless the commissioner refuses to issue the license under section 93 of this act, he shall issue a license as a producer of insurance to a person who has satisfied the requirements of sections 86 and 87 of this act. A producer may qualify for a license in one or more of the lines of authority permitted by statute or regulation, including:

    (a) Life insurance on human lives, which includes benefits from endowments and annuities and may include additional benefits from death by accident and benefits for dismemberment by accident and for disability.

    (b) Health insurance for sickness, bodily injury or accidental death, which may include benefits for disability.

    (c) Property insurance for direct or consequential loss or damage to property of every kind.


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ê2001 Statutes of Nevada, Page 2194 (Chapter 446, AB 618)ê

 

    (d) Casualty insurance against legal liability, including liability for death, injury or disability and damage to real or personal property.

    (e) Surety indemnifying financial institutions or providing bonds for fidelity, performance of contracts, or financial guaranty.

    (f) Variable annuities, including coverage reflecting the results of a separate investment account.

    (g) Credit insurance, including life, disability, property, unemployment, involuntary unemployment, mortgage life, mortgage guaranty, mortgage disability, guaranteed protection of assets, and any other form of insurance offered in connection with an extension of credit that is limited to wholly or partially extinguishing the obligation which the commissioner determines should be considered as limited-line credit insurance.

    (h) Personal lines, consisting of automobile and motorcycle insurance and residential property insurance, including coverage for flood, of personal watercraft and of excess liability, written over one or more underlying policies of automobile or residential property insurance.

    (i) Fixed annuities as a limited line.

    (j) Travel and baggage as a limited line.

    (k) Rental car agency as a limited line.

    2.  A license as a producer of insurance remains in effect unless revoked, suspended, allowed to expire or otherwise terminated, if the license is renewed when due, the fee for renewal and a fee of $15 for deposit in the insurance recovery account are paid for each license and each affiliation with a business organization licensed pursuant to subsection 2 of section 87 of this act and any requirement for education is satisfied by the due date.

    3.  A natural person who allows his license as a producer of insurance to expire may reapply for the same license within 12 months after the date renewal was due without passing a written examination, but a penalty twice the unpaid renewal fee is required for any renewal fee received after the due date.

    4.  A licensed producer of insurance who is unable to renew his license because of military service, extended medical disability or other extenuating circumstance may request a waiver of the time limit and of an examination, fine or sanction otherwise required or imposed because of failure to renew.

    5.  A license must state the licensee’s name, address, personal identification number, the date of issuance, the lines of authority and the date of expiration and contain any other information the commissioner considers necessary. A resident producer shall maintain a place of business in this state which is accessible to the public and where he principally conducts transactions under his license. The place of business may be in his residence. The license must be conspicuously displayed in an area of the place of business which is open to the public.

    6.  A licensee shall inform the commissioner of a change of address, in writing or by other means acceptable to the commissioner within 30 days after the change. If a licensee changes his address without giving written notice and the commissioner is unable to locate the licensee after diligent effort, he may revoke the license without a hearing. The mailing of a letter by certified mail, return receipt requested, addressed to the licensee at his last mailing address appearing on the records of the division, and the return of the letter undelivered, constitutes a diligent effort by the commissioner.


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ê2001 Statutes of Nevada, Page 2195 (Chapter 446, AB 618)ê

 

return of the letter undelivered, constitutes a diligent effort by the commissioner.

    Sec. 89.  1.  Unless the commissioner refuses to issue the license under section 94 of this act, the commissioner shall issue a license as a producer of insurance to a nonresident person if:

    (a) He is currently licensed as a resident and in good standing in his home state;

    (b) He has made the proper request for licensure and paid the fee prescribed for the license and a fee of $15 for deposit in the insurance recovery account;

    (c) He has sent to the commissioner the application for licensure that he made in his home state, or a completed uniform application; and

    (d) His home state issues nonresident licenses as producers of insurance to residents of this state pursuant to substantially the same procedure.

    2.  The commissioner may participate with the National Association of Insurance Commissioners or a subsidiary in a centralized registry in which licensing and appointment of producers of insurance may be effected for all states that require licensing and participate in the registry. If he finds that participation is in the public interest, he may adopt by regulation any uniform standards and procedures necessary for participation, including central collection of fees for licensing and appointment that are handled through the registry.

    3.  A nonresident producer who moves from one state to another state shall file a change of address and certification from his new state of residence within 30 days after his change of legal residence. No fee or application for license is required.

    4.  A nonresident licensed as a producer for surplus lines in his home state must be issued a nonresident license of that kind in this state pursuant to subsection 1, subject in all other respects to chapter 685A of NRS. A nonresident licensed as a producer for limited lines in his home state is entitled to a nonresident license of that kind in this state pursuant to subsection 1, granting the same scope of authority as the license issued in the home state. As used in this subsection, insurance for limited lines is authority granted by the home state which is restricted to less than the total authority prescribed for the associated major lines pursuant to section 88 of this act.

    Sec. 90.  1.  An applicant for licensing in this state as a producer of insurance who was previously licensed for the same lines of authority in another state need not complete any education or examination if he is currently licensed in that state or, if the application is received within 90 days after the cancellation of his license, the other state certifies that he was in good standing at the time of cancellation. Alternatively, the exemption is available if the records of the National Association of Insurance Commissioners show that the applicant is or was licensed and in good standing for the lines of authority requested.

    2.  An examination is not required for a producer of insurance who confines his activity to insurance categorized as limited line, credit, travel, baggage or fixed annuity, or covering vehicles leased for a short term.


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ê2001 Statutes of Nevada, Page 2196 (Chapter 446, AB 618)ê

 

    3.  A person licensed in another state who moves to this state and desires to become licensed as a resident producer of insurance with the benefit of the exemption provided in subsection 1 must apply for licensing within 90 days after establishing legal residence.

    Sec. 91.  1.  An applicant for a license as a producer of insurance who desires to use a name other than his true name as shown on the license shall file with the commissioner a certified copy of the certificate filed pursuant to chapter 602 of NRS. An incorporated applicant or licensee shall file with the commissioner a document showing the corporation’s true name and all fictitious names under which it conducts or intends to conduct business. A licensee shall file promptly with the commissioner written notice of any change in or discontinuance of the use of a fictitious name.

    2.  The commissioner may disapprove in writing the use of a true name, other than the true name of a natural person who is the applicant or licensee, or a fictitious name of any applicant or licensee, on any of the following grounds:

    (a) The name interferes with or is deceptively similar to a name already filed and in use by another licensee.

    (b) Use of the name may mislead the public in any respect.

    (c) The name states or implies that the applicant or licensee is an insurer, motor club or hospital service plan or is entitled to engage in activities related to insurance not permitted under the license applied for or held.

    (d) The name states or implies that the licensee is an underwriter, but:

         (1) A natural person licensed as an agent or broker for life insurance may describe himself as an underwriter or “chartered life underwriter” if entitled to do so;

         (2) A natural person licensed for property and casualty insurance may use the designation “chartered property and casualty underwriter” if entitled thereto; and

         (3) An insurance agent or brokers’ trade association may use a name containing the word “underwriter.”

    (e) The licensee has already filed and not discontinued the use of more than two names, including the true name.

    3.  A licensee shall not use a name after written notice from the commissioner that its use violates the provisions of this section. If the commissioner determines that the use is justified by mitigating circumstances, he may permit, in writing, the use of the name to continue for a specified reasonable period upon conditions imposed by him for the protection of the public consistent with this section.

    4.  Paragraphs (a), (c) and (d) of subsection 2 do not apply to the true name of an organization which on July 1, 1965, held under that name a type of license similar to those governed by this chapter, or to a fictitious name used on July 1, 1965, by a natural person or organization holding such a license, if the fictitious name was filed with the commissioner on or before July 1, 1965.

    Sec. 92.  1.  The commissioner may issue a temporary license as a producer of insurance to any of the following for 180 days or less without requiring an examination if he believes that the temporary license is necessary to carry on the business of insurance:


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ê2001 Statutes of Nevada, Page 2197 (Chapter 446, AB 618)ê

 

    (a) The surviving spouse, personal representative or guardian of a licensed producer who dies or becomes incompetent, to allow adequate time for the sale of the business, the recovery or return of the producer, or the training and licensing of new personnel to operate the business;

    (b) A member or employee of a business organization licensed as a producer, upon the death or disability of the natural person designated in it application or license;

    (c) The designee of a licensed producer entering active service in the armed forces of the United States; or

    (d) A person in any other circumstance where the commissioner believes that the public interest will be best served by issuing the license.

    2.  The commissioner may limit by order the authority of a temporary licensee as he believes necessary to protect persons insured and the public. He may require the temporary licensee to have a suitable sponsor who is licensed as a producer of insurance or authorized as an insurer and who assumes responsibility for all acts of the temporary licensee, and may impose similar requirements to protect persons insured and the public. The commissioner may revoke a temporary license by order if the interests of persons insured or the public are endangered. A temporary license expires when the owner or his personal representative or guardian disposes of the business.

    Sec. 93.  The commissioner may refuse to issue a license or certificate pursuant to this chapter or may place any person to whom a license or certificate is issued pursuant to this chapter on probation, suspend him for not more than 12 months, or revoke or refuse to renew his license or certificate, or may impose an administrative fine or take any combination of the foregoing actions, for one or more of the following causes:

    1.  Providing incorrect, misleading, incomplete or partially untrue information in his application for a license.

    2.  Violating a law regulating insurance, or violating a regulation, order or subpoena of the commissioner or an equivalent officer of another state.

    3.  Obtaining or attempting to obtain a license through misrepresentation or fraud.

    4.  Misappropriating, converting or improperly withholding money or property received in the course of the business of insurance.

    5.  Intentionally misrepresenting the terms of an actual or proposed contract of or application for insurance.

    6.  Conviction of a felony.

    7.  Admitting or being found to have committed an unfair trade practice or fraud.

    8.  Using fraudulent, coercive or dishonest practices, or demonstrated incompetence, untrustworthiness or financial irresponsibility in the conduct of business in this state or elsewhere.

    9.  Denial, suspension or revocation of a license as a producer of insurance, or its equivalent, in any other state, territory or province.

    10.  Forging another’s name to an application for insurance or any other document relating to the transaction of insurance.

    11.  Improperly using notes or other reference material to complete an examination for a license related to insurance.

    12.  Knowingly accepting business related to insurance from an unlicensed person.


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ê2001 Statutes of Nevada, Page 2198 (Chapter 446, AB 618)ê

 

    13.  Failing to comply with an administrative or judicial order imposing an obligation of child support.

    Sec. 94.  1.  If the commissioner denies an application for, or refuses to renew, a license, he shall notify the applicant or licensee and state in writing the reason for the denial or refusal. The applicant or licensee may apply in writing, pursuant to NRS 679B.310, for a hearing before the commissioner to determine the reasonableness of the denial or refusal. The hearing must be held within 30 days and conducted pursuant to NRS 679B.330. The applicant or licensee may waive the requirement to hold the hearing within 30 days, in writing, before a hearing is held.

    2.  The commissioner may suspend, revoke or refuse to renew the license of a business organization if he finds, after hearing, that a violation by a natural person was known or should have been known by one or more of the partners, officers or managers acting on behalf of the organization, the violation was not reported to the commissioner, and no corrective action was taken.

    3.  In addition to or in lieu of a denial, suspension or revocation of, or refusal to renew, a license, an administrative fine of not less than $25 nor more than $500 may be imposed for each violation or act. An order imposing a fine must specify the date, not less than 15 days nor more than 30 days after the date of the order, before which the fine must be paid. If the fine is not paid when due, the commissioner shall immediately revoke the license of a licensee and the fine must be recovered in a civil action brought on behalf of the commissioner by the attorney general. The commissioner shall immediately deposit all such fines collected with the state treasurer for credit to the state general fund.

    4.  The commissioner retains the authority to enforce the provisions of, and impose any penalty or pursue any remedy authorized by, this Title against any person who is under investigation for or charged with a violation of a provision of this Title even if his license or registration has been surrendered or has lapsed by operation of law.

    5.  A licensee must pay all applicable fees, including renewal fees, and maintain any required education during a period of suspension of his license.

    Sec. 95.  1.  An insurer or a producer of insurance shall not pay a commission, brokerage, fee for service or other valuable consideration to a person for selling, soliciting or negotiating insurance in this state if his activities require him to be licensed under this Title and he is not so licensed.

    2.  A person shall not accept a commission, brokerage, fee for service or other valuable consideration for selling, soliciting or negotiating insurance in this state if his activities require him to be licensed under this Title and he is not so licensed.

    3.  Commissions for renewal and other deferred commissions may be paid to a person whose activities required him to be licensed under this Title at the time of the sale, solicitation or negotiation and he was so licensed at that time.

    4.  An insurer or producer of insurance may pay or assign commissions, brokerage, fees for service or other valuable considerations to an insurance agency or a person who does not sell, solicit or negotiate insurance in this state unless the payment would violate the provisions of NRS 686A.110 or 686A.120.


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ê2001 Statutes of Nevada, Page 2199 (Chapter 446, AB 618)ê

 

    Sec. 96.  1.  A producer of insurance shall not act as an agent unless he is appointed as an agent by the insurer. A producer who is not acting as an agent is a broker who does not need to be appointed.

    2.  To appoint a producer of insurance as its agent, an insurer must file, in a form approved by the commissioner, a notice of appointment within 15 days after the contract is executed or the first application for insurance is submitted. An insurer may appoint a producer to act as agent for all or some insurers within its holding company or group by filing a single notice of appointment. A notice of appointment may include several agents.

    3.  Upon receipt of a notice of appointment, the commissioner shall determine within 30 days whether the producer of insurance is eligible for appointment. If he is not, the commissioner shall so notify the insurer within 5 days after the determination is made.

    4.  An insurer shall pay an appointment fee and remit an annual renewal fee for each producer of insurance appointed as its agent. A payment or remittance may include fees for several agents.

    5.  A broker shall not place insurance, other than life insurance, health insurance, annuity contracts or coverage written pursuant to the Surplus Lines Law set forth in chapter 685A of NRS, that covers property or risks within this state unless the broker does so with a licensed agent of an authorized insurer.

    6.  A producer who is acting as an agent may also act as and be a broker with regard to insurers for which he is not acting as an agent. The sole relationship between an insurer and a broker who is appointed as an agent by the insurer as to any transactions arising during the period in which he is appointed as an agent is that of insurer and agent, and not insurer and broker.

    7.  As used in this section:

    (a) “Agent” means a producer of insurance who is compensated by the insurer and sells, solicits or negotiates insurance for the insurer.

    (b) “Broker” means a producer of insurance who:

         (1) Is not an agent of an insurer;

         (2) Solicits, negotiates or procures insurance on behalf of an insured or prospective insured; and

         (3) Does not have the power, by his own actions as a broker, to obligate an insurer upon any risk or with reference to any transaction of insurance.

    Sec. 97.  1.  An insurer or its authorized representative who terminates the appointment, employment or other relationship of a producer of insurance to the insurer for any reason shall notify the commissioner within 30 days after the effective date of the termination, in a form prescribed by the commissioner. The insurer shall provide additional information or documents if so requested in writing by the commissioner.

    2.  If the reason for termination is an activity described in section 93 of this act as a cause for disciplinary action or the insurer knows that the producer has been found to have engaged in such an activity by a court, governmental agency or self-regulatory organization authorized by law, the insurer or its authorized representative shall notify the commissioner, in a form acceptable to the commissioner, if upon further review or investigation the insurer discovers additional information that would have been reportable originally to the commissioner if the insurer had then known it.


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ê2001 Statutes of Nevada, Page 2200 (Chapter 446, AB 618)ê

 

been reportable originally to the commissioner if the insurer had then known it.

    3.  Within 15 days after notifying the commissioner under subsection 1 or 2, the insurer shall mail a copy of the notification to the producer of insurance at his last known address. If the termination was for an activity described in subsection 2, the copy must be sent by certified mail, return receipt requested, or by overnight delivery using a nationally recognized carrier.

    4.  Within 30 days after the producer has received the original or additional notification, he may file written comments concerning the substance of the notification with the commissioner. The producer shall send a copy of the comments, by the same means and at the same time, to the reporting insurer. The comments become a part of the commissioner’s file and must accompany every copy of the underlying report that is distributed or disclosed by the commissioner.

    5.  In the absence of actual malice, an insurer, its authorized representative, a producer of insurance, the commissioner, and any organization of which the commissioner is a member which compiles information and makes it available to other commissioners of insurance or to regulatory or law enforcement agencies are not subject to civil liability, and no cause of action arises against any of them or their respective agents or employees, as a result of any statement or information required by or provided pursuant to this section or any statement by a terminating insurer or a producer to another insurer or producer limited to whether a termination for a cause described in subsection 2 was reported to the commissioner, if in the latter case the propriety of termination for that cause is certified in writing by an officer or authorized representative of the insurer or by the producer.

    6.  In an action brought against a person who may have immunity under subsection 5 for making a statement or providing information required by this section or requested by the commissioner under this section, the plaintiff must plead specifically that subsection 5 does not apply because the person making the statement or providing the information did so with actual malice.

    7.  Subsections 5 and 6 do not abrogate or modify any other privilege or immunity under statute or the common law.

    Sec. 98.  An insurer or its authorized representative who fails to report as required by section 97 of this act or is found by a court of competent jurisdiction to have reported with actual malice is subject to the suspension or revocation of its license, after notice and hearing, and may be further punished by a fine under NRS 679A.180.

    Sec. 99.  A producer of insurance shall report to the commissioner:

    1.  Any administrative action taken against him in another jurisdiction or by another governmental agency in this state, within 30 days after the final disposition of the matter. The report must include a copy of the complaint filed, the order issued, and any other relevant legal documents.

    2.  Any criminal prosecution against him in any jurisdiction, within 30 days after the initial pretrial hearing. The report must include a copy of the complaint filed, the order as a result of the pretrial hearing, and other relevant legal documents.


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ê2001 Statutes of Nevada, Page 2201 (Chapter 446, AB 618)ê

 

    Sec. 100.  NRS 683A.020 is hereby amended to read as follows:

    683A.020  As used in this code, unless the context otherwise requires, the words and terms defined in NRS 683A.025 to [683A.080,] 683A.060, inclusive, and sections 75 to 83, inclusive, of this act, have the meanings ascribed to them in those sections.

    Sec. 101.  NRS 683A.025 is hereby amended to read as follows:

    683A.025  1.  Except as limited by this section, “administrator” means a person who:

    (a) Directly or indirectly underwrites or collects charges or premiums from or adjusts or settles claims of residents of this state or any other state from within this state in connection with workers’ compensation insurance, life or health insurance coverage or annuities, including coverage or annuities provided by an employer for his employees;

    (b) Administers an internal service fund pursuant to NRS 287.010;

    (c) Administers a program of self-insurance for an employer;

    (d) Administers a program which is funded by an employer and which provides pensions, annuities, health benefits, death benefits or other similar benefits for his employees; or

    (e) Is an insurance company that is licensed to do business in this state or is acting as an insurer with respect to a policy lawfully issued and delivered in a state where the insurer is authorized to do business, if the insurance company performs any act described in paragraphs (a) to (d), inclusive, for or on behalf of another insurer.

    2.  “Administrator” does not include:

    (a) An employee authorized to act on behalf of an administrator who holds a certificate of registration from the commissioner.

    (b) An employer acting on behalf of his employees or the employees of a subsidiary or affiliated concern.

    (c) A labor union acting on behalf of its members.

    (d) Except as otherwise provided in paragraph (e) of subsection 1, an insurance company licensed to do business in this state or acting as an insurer with respect to a policy lawfully issued and delivered in a state in which the insurer was authorized to do business.

    (e) A producer of life or health insurance [agent or broker] licensed in this state, when his activities are limited to the sale of insurance.

    (f) A creditor acting on behalf of his debtors with respect to insurance covering a debt between the creditor and debtor.

    (g) A trust and its trustees, agents and employees acting for it, if the trust was established under the provisions of 29 U.S.C. § 186.

    (h) A trust which is exempt from taxation under section 501(a) of the Internal Revenue Code, 26 U.S.C. § 501(a), its trustees and employees, and a custodian, his agents and employees acting under a custodial account which meets the requirements of section 401(f ) of the Internal Revenue Code, 26 U.S.C. § 401(f).

    (i) A bank, credit union or other financial institution which is subject to supervision by federal or state banking authorities.

    (j) A company which issues credit cards, and which advances for and collects premiums or charges from credit card holders who have authorized it to do so, if the company does not adjust or settle claims.

    (k) An attorney at law who adjusts or settles claims in the normal course of his practice or employment, but who does not collect charges or premiums in connection with life or health insurance coverage or with annuities.


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ê2001 Statutes of Nevada, Page 2202 (Chapter 446, AB 618)ê

 

    Sec. 102.  NRS 683A.060 is hereby amended to read as follows:

    683A.060  1.  A “managing general agent” is a person who:

    (a) Negotiates and binds ceding reinsurance contracts on behalf of an insurer or manages all or part of the insurance business of an insurer, including the management of a separate division, department of underwriting office; [and] or

    (b) Acts as an agent for [such] the insurer and with or without the authority, either separately or together with affiliates:

         (1) Produces, directly or indirectly, and underwrites an amount of gross direct written premiums equal to or more than 5 percent of the policyholder surplus as reported in the last annual statement of the insurer in any one quarter or year; and

         (2) Adjusts or pays claims in excess of an amount determined by the commissioner or negotiates reinsurance on behalf of the insurer.

    2.  A managing general agent includes a person with authority to appoint and to terminate the appointment of an agent for an insurer.

    3.  For the purposes of this chapter, the following are not managing general agents:

    (a) An employee of the insurer;

    (b) A manager of the United States branch of an alien insurer;

    (c) An attorney authorized by and acting for the subscribers of a reciprocal insurer or interinsurance exchange; and

    (d) An underwriting manager who, pursuant to a contract, manages all or part of the insurance operations of the insurer, is under common control with the insurer, is subject to the provisions of chapter 692C of NRS and whose compensation is not based on the volume of premiums written or the profit of the business written.

    Sec. 103.  NRS 683A.08522 is hereby amended to read as follows:

    683A.08522  Each application for a certificate of registration as an administrator must include or be accompanied by:

    1.  A financial statement that is certified by an officer of the applicant and must include:

    (a) The amount of money that the applicant expects to collect from or disburse to residents of this state during the next calendar year;

    (b) Financial information for the 90 days immediately preceding the date the application was filed with the commissioner; and

    (c) An income statement and balance sheet for the 2 years immediately preceding the application that are prepared in accordance with generally accepted accounting principles. The submission by the applicant of his consolidated income statement and balance sheet does not constitute compliance with the provisions of this paragraph.

    2.  The documents used to create the business association of the administrator, including [, without limitation,] articles of incorporation, articles of association, a partnership agreement, a trust agreement and a [shareholder] shareholders’ agreement.

    3.  The documents used to regulate the internal affairs of the administrator, including [, without limitation,] the bylaws, rules or regulations of the administrator.

    4.  A certificate of registration issued pursuant to NRS 600.350 for a trade name or trade-mark used by the administrator.

    5.  An organizational chart that identifies each person who directly or indirectly controls the administrator and each affiliate of the administrator.


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ê2001 Statutes of Nevada, Page 2203 (Chapter 446, AB 618)ê

 

    6.  A notarized affidavit from each person who manages or controls the administrator, including [, without limitation,] each member of the board of directors or board of trustees, each officer, partner and member of the business association of the administrator, and each shareholder of the administrator who holds not less than 10 percent of the voting stock of the administrator. The affidavit must include : [, without limitation:]

    (a) The personal history, business record and insurance experience of the affiant;

    (b) Whether the affiant has been investigated by any regulatory authority or has had any license or certificate denied, suspended or revoked in any state; and

    (c) Any other information that the commissioner may require.

    7.  The complete name and address of each office of the administrator, including offices located outside this state.

    8.  A statement that sets forth whether the administrator has:

    (a) Held a license or certificate to transact any kind of insurance in this state or any other state and whether that license or certificate has been refused, suspended or revoked;

    (b) Been indebted to any person and, if so, the circumstances of that debt; and

    (c) Had an administrative agreement canceled and, if so, the circumstances of that cancellation.

    9.  A statement that describes the business plan of the administrator. The statement must include information:

    (a) Concerning the number of persons on the staff of the administrator and the activities proposed in this state or in any other state.

    (b) That demonstrates the capability of the administrator to provide a sufficient number of experienced and qualified persons for the processing of claims, the keeping of records and, if applicable, underwriting.

    10.  If the applicant intends to solicit new or renewal business, proof that the applicant employs or has contracted with [an agent] a producer of insurance licensed in this state to solicit and take applications. An applicant who intends to solicit insurance contracts directly or to act as [an insurance agent] a producer must provide proof that he is licensed as [an insurance agent] a producer in this state.

    Sec. 104.  NRS 683A.090 is hereby amended to read as follows:

    683A.090  1.  [A person shall not in this state be, act as or hold himself out to be, with respect to subjects of insurance resident, located or to be performed in this state or elsewhere, an agent, broker or solicitor unless licensed as such under this code.] A managing general agent, whether or not located in this state, shall not be or act as such with respect to the business of an insurer in this state unless licensed as such under this code.

    2.  [An agent, broker or solicitor shall not take an application for, procure or place for others any kind of insurance as to which he is not then so licensed.

    3.  Except as otherwise provided in NRS 683A.440 concerning the sharing of commissions, an agent shall not place any insurance with any insurer as to which he does not then hold a license and an appointment as agent under this code.

    4.]  A person who acts as [an agent, broker or solicitor] a managing general agent in this state without a license may be assessed an administrative fine of not more than $1,000 for each violation.


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ê2001 Statutes of Nevada, Page 2204 (Chapter 446, AB 618)ê

 

    [5.  In addition to or in lieu of any applicable denial, suspension or revocation of license or administrative fine, any person violating this section is guilty of a misdemeanor.]

    Sec. 105.  NRS 683A.105 is hereby amended to read as follows:

    683A.105  If a short-term lessor of passenger vehicles licensed pursuant to NRS 482.363 holds a limited [agent’s] license as a producer of insurance issued pursuant to [NRS 683A.260,] section 89 of this act, an employee of the short-term lessor may engage in the solicitation and sale of insurance requested by a lessee pursuant to NRS 482.3158 without a license issued pursuant to this chapter if the solicitation and sale of such insurance is done on behalf of, and under the supervision of, the short-term lessor.

    Sec. 106.  NRS 683A.110 is hereby amended to read as follows:

    683A.110  1.  For the purposes of this section:

    (a) “Affiliate” means a person that directly, or indirectly through one or more intermediaries, is controlled by, or is under common control with, a bank.

    (b) “Bank” means any institution that accepts deposits that the depositor has a legal right to withdraw on demand.

    (c) “Financial holding company” means a bank holding company a defined in section 4(1)(1) of the Bank Holding Company Act of 1956, 12 U.S.C. § 1841(l)(1).

    (d) “Parent” means a person that owns or controls a bank, directly or indirectly, in whole or in part.

    [(d)] (e) “Subsidiary” means a person owned or controlled by a bank, directly or indirectly, in whole or in part.

    2.  A bank [must not directly or indirectly] may be licensed [to sell] as a producer of insurance in this state [except as to] :

    (a) To the extent permitted by Title V of Public Law 106-102, 15 U.S.C. §§ 6801 et seq.; and

    (b) For credit insurance, as defined in NRS 690A.015, and credit property insurance . [, or]

    3.  A bank must not be licensed or admitted as an insurer.

    [3.] 4.  The provisions of subsection [2] 3 do not prohibit the licensing by the commissioner [:

    (a) Of] of an affiliate, financial holding company, parent or subsidiary of a bank to sell insurance or be admitted as an insurer . [; or

    (b) Of a bank to sell annuities. As used in this paragraph, “annuity” has the meaning ascribed to it in NRS 688A.020.]

    Sec. 107.  NRS 683A.140 is hereby amended to read as follows:

    683A.140  1.  A firm or corporation may be licensed [only as an agent or broker, resident or nonresident, or] as a managing general agent.

    2.  A resident firm or corporation which has more than one office in this state is a single licensee for the purposes of being appointed by insurers and the authority of natural persons to act for the firm or corporation. Such a firm or corporation must obtain a copy of its license for each location, but only must obtain one original license as [an agent or broker.] a managing general agent.

    3.  For licensing as [an agent or broker,] a managing general agent, each general partner and each natural person to act for the firm, or each natural person to act for the corporation, must be named in the license [or registered with the commissioner,] and must qualify as an individual licensee. A natural person who is authorized to act for a firm or corporation and who also wishes to be licensed in an individual capacity must obtain a separate license in his own name.


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ê2001 Statutes of Nevada, Page 2205 (Chapter 446, AB 618)ê

 

to be licensed in an individual capacity must obtain a separate license in his own name. The commissioner shall charge appropriate fees for each person who is licensed to act for a firm or corporation and who is named on the license . [or registered with the commissioner.

    4.  A natural person who is not a resident of this state as provided in paragraph (a) of subsection 1 of NRS 683A.130 must not be so named or registered as to the license of a resident agent or resident broker, and shall not exercise the license powers thereof. A natural person who is a resident of this state must not be so named or registered as to the license of a nonresident agent or nonresident broker, and shall not exercise the powers thereof.

    5.  A license as a resident agent or resident broker must not be issued to a firm or corporation unless it maintains a principal place of business in this state, and the transaction of business under the license is specifically authorized in the firm’s partnership agreement or the corporation’s articles.

    6.] 4.  The licensee shall promptly notify the commissioner of all changes among its members, directors and officers, and among other persons [designated in or registered as to] named in the license. The licensee shall provide to the commissioner upon request information concerning officers or owners of the firm or corporation who are not named in the license . [or registered with the commissioner.]

    Sec. 108.  NRS 683A.150 is hereby amended to read as follows:

    683A.150  [1.]  Written application for [an agent’s, broker’s or solicitor’s] a managing general agent’s license must be filed with the commissioner by the applicant, accompanied by the applicable fee . [shown in NRS 680B.010. The application form must be accompanied by the applicant’s fingerprints, and must require full answers to questions reasonably necessary to determine the applicant’s:

    (a) Identity and residence;

    (b) Business record or occupations for not less than the 2 years next preceding, with the name and address of each employer, if any; and

    (c) Experience or instruction in the kind or kinds of insurance business he proposes to transact, and relative to the insurance laws of this state,

and other facts reasonably required by the commissioner to determine the applicant’s qualifications for the license applied for.

    2.  If for an agent’s license, the application must state the kinds of insurance proposed to be transacted, and be accompanied by a written appointment by an authorized insurer or insurers as agent for such kinds of insurance, subject to issuance of the license.

    3.  If for a solicitor’s license, the application must be accompanied by the written requisition and certification by a licensed resident general lines agent or licensed resident broker, showing that the applicant is his bona fide employee, or is so employed as a solicitor subject to issuance of the license.

    4.  If the applicant for an agent’s or broker’s license is a firm or corporation, the application must also show the names of all members, officers and directors, and must designate each natural person who is to exercise the powers of a licensee. Each person who is to exercise the power of a licensee shall furnish information as to himself as though he were applying personally for a license. The commissioner may require members, officers, directors or owners who will not exercise the powers of a licensee to submit such information.


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ê2001 Statutes of Nevada, Page 2206 (Chapter 446, AB 618)ê

 

    5.  The application must show whether and where the applicant is now or ever was previously licensed as to insurance and whether any such license was ever refused, suspended, revoked or renewal or continuance refused. The application also must indicate whether any insurer, general agent, agent or broker claims the applicant has ever had an agency contract canceled, and the facts thereof and, if the applicant is married, like information with respect to the applicant’s spouse.

    6.  The application must be verified by the applicant, and an applicant for a license under this chapter shall not knowingly misrepresent or withhold any fact or information called for in the application form or relevant thereto.]

    Sec. 109.  NRS 683A.350 is hereby amended to read as follows:

    683A.350  1.  Every nonresident licensed by this state as [an agent or broker pursuant to NRS 683A.340] a producer of insurance shall appoint the commissioner in writing as his attorney upon whom may be served all legal process issued in connection with any action or proceeding brought or pending in this state against or involving the licensee and relating to transactions under his Nevada license. The appointment is irrevocable and continues in force for so long as any such action or proceeding may arise or exist. Duplicate copies of process must be served upon the commissioner or other person in apparent charge of the division during the commissioner’s absence, accompanied by payment of the fee for service of process . [as specified in NRS 680B.010.] Upon such service the commissioner shall promptly forward a copy of the process by certified mail with return receipt requested to the nonresident licensee at his business address last of record with the division. Process served and the copy thereof forwarded as provided in this subsection constitutes for all purposes personal service thereof upon the licensee.

    2.  Every such licensee shall likewise file with the commissioner his written agreement to appear before the commissioner pursuant to notice of hearing, show cause order or subpoena issued by the commissioner and deposited, postage paid, by certified mail with the United States Postal Service, addressed to the licensee at his address last of record in the division, and that upon failure of the licensee so to appear the licensee thereby consents to any subsequent suspension, revocation or refusal of the commissioner to continue the licensee’s license.

    Sec. 110.  NRS 683A.370 is hereby amended to read as follows:

    683A.370  1.  A licensed [resident agent] producer of insurance or insurer may solicit for and issue personal travel accident insurance policies by means of mechanical vending machines supervised by the [agent] producer and placed at airports and similar places of convenience to the traveling public, if the commissioner finds that:

    (a) The policy provides reasonable coverage and benefits, is suitable for sale and issuance by vending machine, and that use of such a machine in a proposed location would be of material convenience to the public;

    (b) The type of machine proposed to be used is reasonably suitable for the purpose;

    (c) Reasonable means are provided for informing prospective purchasers of policy coverages and restrictions;

    (d) Reasonable means are provided for the refund of money inserted in defective machines and for which insurance so paid for is not received; and

    (e) The cost of maintaining such a machine at a particular location is reasonable in amount.


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ê2001 Statutes of Nevada, Page 2207 (Chapter 446, AB 618)ê

 

    2.  For each machine to be used, the commissioner shall issue to the [agent] producer upon his application a special vending machine license. [The license shall specify the name and address of the insurer and agent, the name of the policy to be sold, the serial number and operating location of the machine.] The license [shall be] is subject to annual continuation, to expiration, suspension or revocation coincidentally with that of the [agent.] producer. The commissioner shall also revoke the license of any machine as to which he finds that the license qualifications no longer exist. [The license fee shall be as specified in NRS 680B.010 (fee schedule) for each license year or part thereof for each respective machine.] Proof of the existence of a subsisting license [shall] must be displayed on or about each machine in use in such manner as the commissioner reasonably requires.

    Sec. 111.  NRS 683A.376 is hereby amended to read as follows:

    683A.376  As used in NRS 683A.375 to 683A.379, inclusive:

    1.  “Agent who performs utilization review” includes any person who performs such review except a person acting on behalf of the Federal Government, but only to the extent that the person provides the service for the Federal Government or an agency thereof.

    2.  “Insured” means a natural person who has contracted for or participates in coverage under a policy of insurance, a contract with a health maintenance organization, a plan for hospital, medical or dental services or any other program providing payment, reimbursement or indemnification for the costs of health care for himself, his dependents, or both.

    3.  “Utilization review” means a system that provides, at a minimum, for review of the necessity and appropriateness of the allocation of health care resources and services provided or proposed to be provided to an insured [.] or to any person claiming benefits against a policy of the insured. The term does not include responding to requests made by an insured for clarification of his coverage.

    Sec. 112.  NRS 683A.383 is hereby amended to read as follows:

    683A.383  1.  A natural person who applies for the issuance or renewal of a certificate of registration as an administrator or a license as [an agent, broker, solicitor] a producer of insurance or managing general agent shall submit to the commissioner the statement prescribed by the welfare division of the department of human resources pursuant to NRS 425.520. The statement must be completed and signed by the applicant.

    2.  The commissioner shall include the statement required pursuant to subsection 1 in:

    (a) The application or any other forms that must be submitted for the issuance or renewal of the certificate of registration or license; or

    (b) A separate form prescribed by the commissioner.

    3.  A certificate of registration as an administrator or a license as [an agent, broker, solicitor] a producer of insurance or managing general agent may not be issued or renewed by the commissioner if the applicant is a natural person who:

    (a) Fails to submit the statement required pursuant to subsection 1; or

    (b) Indicates on the statement submitted pursuant to subsection 1 that he is subject to a court order for the support of a child and is not in compliance with the order or a plan approved by the district attorney or other public agency enforcing the order for the repayment of the amount owed pursuant to the order.


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ê2001 Statutes of Nevada, Page 2208 (Chapter 446, AB 618)ê

 

    4.  If an applicant indicates on the statement submitted pursuant to subsection 1 that he is subject to a court order for the support of a child and is not in compliance with the order or a plan approved by the district attorney or other public agency enforcing the order for the repayment of the amount owed pursuant to the order, the commissioner shall advise the applicant to contact the district attorney or other public agency enforcing the order to determine the actions that the applicant may take to satisfy the arrearage.

    Sec. 113.  NRS 683A.385 is hereby amended to read as follows:

    683A.385  1.  If the commissioner receives a copy of a court order issued pursuant to NRS 425.540 that provides for the suspension of all professional, occupational and recreational licenses, certificates and permits issued to a person who is the holder of a certificate of registration as an administrator or a license as [an agent, broker, solicitor] a producer of insurance or managing general agent, the commissioner shall [deem] suspend the certificate of registration or license issued to that person [to be suspended] at the end of the 30th day after the date on which the court order was issued unless the commissioner receives a letter issued to the holder of the certificate of registration or license by the district attorney or other public agency pursuant to NRS 425.550 stating that the holder of the certificate of registration or license has complied with the subpoena or warrant or has satisfied the arrearage pursuant to NRS 425.560.

    2.  The commissioner shall reinstate a certificate of registration as an administrator or a license as [an agent, broker, solicitor] a producer of insurance or managing general agent that has been suspended by a district court pursuant to NRS 425.540 if the commissioner receives a letter issued by the district attorney or other public agency pursuant to NRS 425.550 to the person whose certificate of registration or license was suspended stating that the person whose certificate of registration or license was suspended has complied with the subpoena or warrant or has satisfied the arrearage pursuant to NRS 425.560.

    Sec. 114.  NRS 683A.387 is hereby amended to read as follows:

    683A.387  The application of a natural person who applies for the issuance of a certificate of registration as an administrator or a license as [an agent, broker, solicitor] a producer of insurance or managing general agent must include the social security number of the applicant.

    Sec. 115.  NRS 683A.390 is hereby amended to read as follows:

    683A.390  1.  Every [general lines agent, general lines broker, life agent and health agent] producer of insurance shall keep complete records of transactions under his license . [and those of his solicitors.] The records must show, for each insurance policy placed or countersigned by or through the licensee, not less than the names of the insurer and insured, the number and expiration date of, and premium payable as to, the policy or contract, the names of all other persons from whom business is accepted or to whom commissions are promised or paid, all premiums collected, and such additional information as the commissioner may reasonably require.

    2.  The records must be open to examination of the commissioner at all times, and the commissioner may at any time require the licensee to furnish to him, in such manner or form as he requires, any information kept or required to be kept in those records.

    3.  Records of a particular policy or contract may be destroyed 3 years after expiration of the policy or contract.


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    Sec. 116.  NRS 683A.400 is hereby amended to read as follows:

    683A.400  1.  All money of others received by any person in any way licensed or acting as [an insurance agent, broker, solicitor,] a producer of insurance, surplus lines broker, motor club agent or bail agent under any insurance policy or undertaking of bail [, are] is received and held by [the person] him in a fiduciary capacity. Any such person who diverts or appropriates such fiduciary money to his own use is guilty of embezzlement.

    2.  Each such person who does not make immediate remittance of the money to the insurer or other person entitled thereto, shall elect and follow with respect to money received for the account of a particular insurer or person either of the following methods:

    (a) Remit received premiums, less applicable commissions, if any, and return premiums to the insurer or other person entitled thereto within 15 days after receipt; or

    (b) Establish and maintain in a commercial bank, credit union or other established financial institution depositary in this state one or more accounts, separate from accounts holding his general personal, firm or corporate money, and forthwith deposit and retain in the accounts pending transmittal to the insurer or other person entitled thereto, all such premiums, net of applicable commissions, if any, and return premiums. Money belonging to more than one principal may be so deposited and held in the same such account if the amount so held for each principal is readily ascertainable from the records of the depositor. The depositor may commingle with such fiduciary money in a particular account such additional money as he may deem prudent to advance premiums, establish reserves for the payment of return commissions, or for other contingencies arising in his business of receiving and transmitting premiums or return premiums.

    3.  Such a person may commingle with his own money to an unlimited amount money of a particular principal if the principal in writing in advance has specifically waived the segregation requirements of subsection 2.

    4.  Any commingling of money with money of any such person permitted under this section does not alter the fiduciary capacity of [such] that person with respect to the money of others.

    Sec. 117.  NRS 683A.410 is hereby amended to read as follows:

    683A.410  1.  If within 30 days after the contractual due date of any premium received by him, [any agent, broker] a producer of insurance or surplus lines broker fails to remit the premium to the insurer or agency to whom it is owing, the insurer or agency, as the case may be, shall promptly report [such] the failure to the commissioner in writing.

    2.  The commissioner may suspend the licenses of [any such agent, broker] the producer or surplus lines broker so failing to remit, until the remittance has been made or the insurer or agency has filed with the commissioner a release of the indebtedness satisfactory to the commissioner.

    3.  The applicable procedures provided for in [NRS 683A.450 (suspension, revocation, refusal of license) and NRS 683A.460 (certain procedure for suspension, revocation of license)] section 93 of this act apply to suspensions of license under this section . [, except that the 12-month limit of suspension periods provided in NRS 683A.450 does not apply.]

    4.  If the commissioner, by the admission of the [agent, broker] producer or surplus lines broker, or by examination of the records of the [agent, broker] producer or surplus lines broker, determines that the charged failure to remit is true, he may suspend the license without hearing.


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ê2001 Statutes of Nevada, Page 2210 (Chapter 446, AB 618)ê

 

    Sec. 118.  Chapter 683C of NRS is hereby amended by adding thereto the provisions set forth as sections 119 to 121, inclusive, of this act.

    Sec. 119.  1.  A nonresident who is licensed by this state as an insurance consultant shall appoint the commissioner, in writing, as his attorney upon whom may be served all legal process issued in connection with any action or proceeding brought or pending in this state against or involving him and relating to transactions under his Nevada license. The appointment is irrevocable and remains in force so long as such an action or proceeding exists or may arise. Duplicate copies of process must be served upon the commissioner, or other person in apparent charge of the division during his absence, accompanied by payment of the fee for service of process. Promptly after any such service, the commissioner shall forward a copy of the process by certified mail, return receipt requested, to the nonresident licensee at his business address of most recent record with the division. Process so served and the copy so forwarded constitutes personal service upon the licensee for all purposes.

    2.  Each such nonresident licensee shall also file with the commissioner his written promise to appear before the commissioner pursuant to notice of hearing, order to show cause, or subpoena issued by the commissioner and sent by certified mail to the licensee at his business address of most recent record with the division, and that if he fails to appear, he thereby consents to any subsequent suspension, revocation or refusal to renew his license.

    Sec. 120.  1.  The commissioner may place an insurance consultant on probation, suspend his license for not more than 12 months, or revoke or refuse to renew his license, or may impose an administrative fine or take any combination of the foregoing actions, for one or more of the causes set forth in section 93 in this act.

    2.  The provisions of section 94 of this act also apply to an insurance consultant.

    Sec. 121.  1.  Upon suspension, limitation or revocation of the license of an insurance consultant, the commissioner shall immediately notify the licensee in person or by mail addressed to him at his most recent address of record with the division. Notice by mail is effective when mailed.

    2.  The commissioner shall not again issue a license under this chapter to any natural person whose license has been revoked until at least 1 year after the revocation has become final, and thereafter not until the person again qualifies for it under this chapter. A person whose license has been revoked twice is not eligible for any license under this Title.

    3.  If the license of a business organization is suspended, limited or revoked, no member, officer or director of the organization may be licensed, or designated in a license to exercise its powers, during the period of suspension or revocation, unless the commissioner determines upon substantial evidence that the member, officer or director was not personally at fault and did not knowingly aid, abet, assist or acquiesce in the matter for which the license was suspended or revoked.

    Sec. 122.  NRS 683C.040 is hereby amended to read as follows:

    683C.040  A license may be renewed for additional 3-year periods by submitting to the commissioner an application for renewal and:

    1.  If the application is made:


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    (a) On or before the expiration date of the license, [a] the applicable renewal fee [of $78] and an additional fee of $15 for deposit in the insurance recovery account; or

    (b) Not more than 30 days after the expiration date of the license, [a] the applicable renewal fee [of $117] plus any late fee required and an additional fee of $15 for deposit in the insurance recovery account;

    2.  If the applicant is a natural person, the statement required pursuant to NRS 683C.043; and

    3.  [Proof] If the applicant is a resident, proof of the successful completion of appropriate courses of study required for renewal, as established by the commissioner by regulation.

    Sec. 123.  NRS 683C.090 is hereby amended to read as follows:

    683C.090  [The qualifications required for the licensing of a natural person pursuant to subsection 1 of NRS 683A.130 also apply to an insurance consultant.]

    1.  The commissioner shall prescribe the form of application by a natural person for a license as an insurance consultant. The applicant must declare, under penalty of refusal to issue, or suspension or revocation of, the license, that the statements made in the application are true, correct and complete to the best of his knowledge and belief. Before approving the application, the commissioner must find that the applicant has:

    (a) Attained the age of 18 years.

    (b) Not committed any act that is a ground for refusal to issue, or suspension or revocation of, a license.

    (c) Paid the fee prescribed for the license and a fee of $15 for deposit in the insurance recovery account, neither of which may be refunded.

    (d) Passed each examination required for the license and successfully complete each course of instruction which the commissioner requires by regulation, unless he is a resident of another state and holds a similar license in that state.

    2.  A business organization must be licensed as an insurance consultant in order to act as such. Application must be made on a form prescribed by the commissioner. Before approving the application, the commissioner must find that the applicant has:

    (a) Paid the fee prescribed for the license and a fee of $15 for deposit in the insurance recovery account, neither of which may be refunded; and

    (b) Designated a natural person licensed as an insurance consultant to be responsible for the organization’s compliance with the laws and regulations of this state relating to insurance.

    3.  The commissioner may require any document reasonably necessary to verify information contained in an application.

    4.  A license issued pursuant to this chapter is valid for 3 years after the date of issuance or until it is suspended, revoked or otherwise terminated.

    Sec. 124.  Chapter 684A of NRS is hereby amended by adding thereto a new section to read as follows:

    An adjuster whose license expires is exempt from retaking the examination required by NRS 684A.100 if he applies and is relicensed within 6 months after the date of expiration.

    Sec. 125.  NRS 684A.040 is hereby amended to read as follows:

    684A.040  1.  No person [shall] may act as, or hold himself out to be, an adjuster or associate adjuster in this state unless then licensed as such under the applicable independent adjuster’s license, public adjuster’s license or associate adjuster’s license, as the case may be, issued under the provisions of this chapter.


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ê2001 Statutes of Nevada, Page 2212 (Chapter 446, AB 618)ê

 

associate adjuster’s license, as the case may be, issued under the provisions of this chapter.

    2.  For purposes of this chapter the commissioner may [, in his discretion,] issue a limited license to an adjuster handling claims under a contract of one or more of the kinds of insurance defined in NRS 681A.010 to 681A.080, inclusive.

    3.  Any person violating the provisions of this section is guilty of a gross misdemeanor.

    4.  A person who acts as an adjuster in this state without a license is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 126.  NRS 684A.110 is hereby amended to read as follows:

    684A.110  1.  If the commissioner finds that the application is complete, that the applicant has passed all required examinations and is otherwise eligible and qualified for the license as an adjuster, the commissioner shall promptly issue the license. If the commissioner refuses to issue the license, he shall promptly notify the applicant in writing of the refusal, stating the grounds for the refusal.

    2.  All fees paid by an applicant with his application for a license shall be deemed earned when received and may not be refunded.

    3.  An applicant for a license who desires to use a name other than his true name must comply with the provisions of [NRS 683A.240.] section 91 of this act.

    Sec. 127.  NRS 684A.200 is hereby amended to read as follows:

    684A.200  Nonresidents of this state who are granted licenses as adjusters pursuant to subsection 2 of NRS 684A.070 [shall also be] are also subject to NRS 683A.350 . [(nonresident agents, brokers: Service of process, agreement to appear).]

    Sec. 128.  NRS 684A.210 is hereby amended to read as follows:

    684A.210  1.  The commissioner may suspend, revoke, limit or refuse to continue any adjuster’s license or associate adjuster’s license:

    (a) For any cause specified in any other provision of this chapter;

    (b) For any [such] applicable cause [as] for revocation of [an agent’s or broker’s license under NRS 683A.450;] the license of a producer of insurance under section 93 of this act; or

    (c) If the licensee has for compensation represented or attempted to represent both the insurer and the insured in the same transaction.

    2.  The license of a firm or corporation may be suspended, revoked, limited or continuation refused for any cause which relates to any individual designated in or with respect to the license to exercise its powers.

    3.  The holder of any license which has been suspended or revoked shall forthwith surrender the license to the commissioner.

    Sec. 129.  NRS 684A.220 is hereby amended to read as follows:

    684A.220  NRS [683A.460 (certain procedure for suspension, revocation of license), NRS 683A.470 (procedure following suspension, revocation) and NRS 683A.480 (return of license to commissioner) shall] 683A.480 and sections 93 and 94 of this act also apply to suspension, revocation, limitation or refusal to continue adjusters’ licenses and associate adjusters’ licenses, except where in conflict with the express provisions of this chapter.

    Sec. 130.  NRS 684B.020 is hereby amended to read as follows:

    684B.020  1.  No person [shall] may act as a motor vehicle physical damage appraiser for motor vehicle physical damage claims on behalf of any insurance company or [firm or corporation] business organization engaged in the adjustment or appraisal of motor vehicle claims unless [such person] he has:


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ê2001 Statutes of Nevada, Page 2213 (Chapter 446, AB 618)ê

 

insurance company or [firm or corporation] business organization engaged in the adjustment or appraisal of motor vehicle claims unless [such person] he has:

    (a) Secured a license from the commissioner.

    (b) Paid the applicable license fee.

    2.  Any person who has been engaged in the business as a motor vehicle physical damage appraiser for a period of 2 consecutive years immediately [prior to] before January 1, 1972, [shall be granted] is entitled to a license upon application to the commissioner without further qualification.

    3.  The provisions of this section do not apply to:

    (a) A licensed insurance adjuster.

    (b) An employee of any authorized insurer, motor club, motor vehicle dealer or automobile body repair shop.

    4.  A person who acts as a motor vehicle physical damage appraiser in this state without a license, unless exempt under subsection 3, is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 131.  NRS 684B.040 is hereby amended to read as follows:

    684B.040  1.  An applicant for a license as a motor vehicle physical damage appraiser must file a written application therefor with the commissioner on forms prescribed and furnished by the commissioner. The applicant must furnish information as to his identity, personal history, experience, financial responsibility, business record and other pertinent matters as reasonably required by the commissioner to determine the applicant’s eligibility and qualifications for the license.

    2.  If the applicant is a natural person, the application must include the social security number of the applicant.

    3.  If the applicant is a [firm or corporation,] business organization, the application must include the names of all members , [of the firm, corporate] officers and [corporate] directors, and must designate each natural person who is to exercise the [license powers. Each such member, officer, director and natural person must qualify as an individual licensee.] licensee’s powers. A natural person who is authorized to act for a [firm or corporation] business organization and who also wishes to be licensed in an individual capacity must obtain a separate license in his own name.

    4.  The application must be accompanied by the applicable license fee . [specified in NRS 680B.010.] The commissioner shall charge a separate fee for each person authorized to act for a [firm or corporation.] business organization.

    5.  An applicant for a license who desires to use a name other than his true name must comply with the provisions of [NRS 683A.240.] section 91 of this act. The commissioner shall not issue a license in a trade name unless the name has been registered pursuant to NRS 600.240 to 600.450, inclusive.

    6.  An applicant for a license shall not willfully misrepresent or withhold any fact or information called for in the application form or in connection with his application. A violation of this subsection is a gross misdemeanor.

    Sec. 132.  NRS 684B.110 is hereby amended to read as follows:

    684B.110  1.  The commissioner may suspend, revoke, limit or refuse to continue any motor vehicle physical damage appraiser’s license:

    (a) For any cause specified in any other provision of this chapter;

    (b) For any such applicable cause as for revocation of [an agent’s or broker’s license under NRS 683A.450;] the license of a producer of insurance under section 93 of this act; or


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ê2001 Statutes of Nevada, Page 2214 (Chapter 446, AB 618)ê

 

    (c) If the licensee has for compensation represented or attempted to represent both the insurer and the insured in the same transaction.

    2.  The license of a [firm or corporation] business organization may be suspended, revoked, limited or continuation refused for any cause which relates to any individual designated in or with respect to the license to exercise its powers.

    3.  The holder of any license which has been suspended or revoked shall forthwith surrender the license to the commissioner.

    Sec. 133.  NRS 684B.120 is hereby amended to read as follows:

    684B.120  NRS [683A.460 (certain procedure for suspension, revocation of license), NRS 683A.470 (procedure following suspension, revocation) and NRS 683A.480 (return of license to commissioner) shall] 683A.480 and sections 93 and 94 of this act also apply to suspension, revocation, limitation or refusal to continue motor vehicle physical damage appraiser’s licenses, except where in conflict with the express provisions of this chapter.

    Sec. 134.  NRS 685A.220 is hereby amended to read as follows:

    685A.220  In addition to those referred to in other provisions of [the Surplus Lines Law,] this chapter, the following provisions of chapter 683A of NRS , [(agents, brokers and solicitors) shall,] to the extent applicable and not inconsistent with the express provisions of this chapter, also apply to surplus lines brokers:

    1.  [NRS 683A.270 (continuation, expiration of license);

    2.]  NRS 683A.400 ; [(fiduciary funds);

    3.] 2.  NRS 683A.410 ; [(failure to remit premiums);

    4.  NRS 683A.450 (suspension, revocation, refusal of license);

    5.  NRS 683A.460 (certain procedure for suspension, limitation or revocation of license);

    6.  NRS 683A.470 (procedure following suspension, revocation);

    7.  NRS 683A.480 (return of license to commissioner); and

    8.] 3.  Section 94 of this act;

    4.  Section 95 of this act;

    5.  Section 99 of this act;

    6.  NRS 683A.480; and

    7.  NRS 683A.490 . [(penalties).]

    Sec. 135.  Chapter 686A of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  Disclosure of nonpublic personal information in a manner contrary to the provisions of subchapter 1 of Title V of Public Law 106-102, 15 U.S.C. §§ 6801-6809 is an unfair act or practice in the business of insurance within the meaning of this chapter.

    2.  As used in this section “nonpublic personal information” has the meaning ascribed to it in 15 U.S.C. § 6809(4).

    3.  The commissioner shall adopt regulations necessary to carry out the provisions of this section.

    Sec. 136.  NRS 686A.010 is hereby amended to read as follows:

    686A.010  The purpose of NRS 686A.010 to 686A.310, inclusive, and section 135 of this act is to regulate trade practices in the business of insurance in accordance with the intent of Congress as expressed in the Act of Congress approved March 9, 1945, being c. 20, 59 Stat. 33, also designated as 15 U.S.C. §§ 1011 to 1015, inclusive, [by defining, or providing for the determination of, all such practices in this state which constitute unfair methods of competition or unfair or deceptive acts or


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practices and by prohibiting the trade practices so defined or determined.] and Title V of Public Law 106-102, 15 U.S.C. §§ 6801 et seq.

    Sec. 137.  NRS 686A.520 is hereby amended to read as follows:

    686A.520  1.  The provisions of NRS [683A.450 to 683A.480, inclusive, and] 683A.480 and sections 93, 94 and 99 of this act and NRS 686A.010 to 686A.310, inclusive, apply to companies.

    2.  For the purposes of subsection 1, unless the context requires that a section apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “company.”

    Sec. 137.5.  NRS 687A.033 is hereby amended to read as follows:

    687A.033  1.  “Covered claim” means an unpaid claim or judgment, including a claim for unearned premiums, which arises out of and is within the coverage of an insurance policy to which this chapter applies issued by an insurer which becomes an insolvent insurer, if one of the following conditions exists:

    (a) The claimant or insured, if a natural person, is a resident of this state at the time of the insured event.

    (b) The claimant or insured, if other than a natural person, maintains its principal place of business in this state at the time of the insured event.

    (c) The property from which the first party property damage claim arises is permanently located in this state.

    (d) The claim is not a covered claim pursuant to the laws of any other state and the premium tax imposed on the insurance policy is payable in this state pursuant to NRS 680B.027.

    2.  The term does not include:

    (a) An amount that is directly or indirectly due a reinsurer, insurer, insurance pool or underwriting association, as recovered by subrogation, indemnity or contribution, or otherwise.

    (b) That part of a loss which would not be payable because of a provision for a deductible or a self-insured retention specified in the policy.

    (c) Except as otherwise provided in this paragraph, any claim filed with the association after:

         (1) Eighteen months after the date of the order of liquidation; or

         (2) The final date set by the court for the filing of claims against the liquidator or receiver of the insolvent insurer,

whichever is earlier. The provisions of this paragraph do not apply to a claim for workers’ compensation that is reopened pursuant to the provisions of NRS 616C.390.

    (d) A claim filed with the association for a loss that is incurred but is not reported to the association before the expiration of the period specified in subparagraph (1) or (2) of paragraph (c).

    (e) An obligation to make a supplementary payment for adjustment or attorney’s fees and expenses, court costs or interest and bond premiums incurred by the insolvent insurer before the appointment of a liquidator, unless the expenses would also be a valid claim against the insured.

    (f) A first party or third party claim brought by or against an insured, if the aggregate net worth of the insured and any affiliate of the insured, as determined on a consolidated basis, is more than $25,000,000 on December 31 of the year immediately preceding the date the insurer becomes an insolvent insurer. The provisions of this paragraph do not apply to a claim for workers’ compensation.


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    Sec. 138.  NRS 689.065 is hereby amended to read as follows:

    689.065  “Net purchase price” means the [net amount of the] purchase price , including interest earned on the trust funds attributable to the buyer, remaining after deduction of the sales commission.

    Sec. 139.  NRS 689.160 is hereby amended to read as follows:

    689.160  1.  The provisions of NRS [683A.450 to 683A.480, inclusive, and] 683A.480 and sections 93, 94 and 99 of this act and NRS 686A.010 to 686A.310, inclusive, apply to agents and sellers.

    2.  For the purposes of subsection 1, unless the context requires that a section apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “agent” and “seller.”

    3.  The provisions of NRS 679B.230 to 679B.300, inclusive, apply to sellers. Unless the context requires that a provision apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “seller.”

    Sec. 140.  NRS 689.225 is hereby amended to read as follows:

    689.225  1.  It is unlawful for any person to solicit the sale of a prepaid contract in this state on behalf of a seller unless he holds a valid agent’s license issued by the commissioner.

    2.  This section does not apply to a seller who holds a valid seller’s certificate of authority.

    3.  A person who solicits the sale of a prepaid contract in this state without a license is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 141.  NRS 689.355 is hereby amended to read as follows:

    689.355  1.  Except as otherwise provided in subsection 2, if the buyer moves to another geographic area beyond the normal facilities of the seller and performers under the prepaid contract, the contract automatically terminates upon the buyer’s written notice to the seller and trustee of his move and of his desire to terminate the contract. The trustee, as soon as reasonably possible after receipt of the notice, shall refund to the buyer all money in the trust fund , including earned interest, held [to] for the buyer’s account.

    2.  If the contract continues in force and the buyer is not in default thereunder, upon the demise of the contract beneficiary, the contract automatically terminates. Upon termination, the seller shall refund to the buyer or to his representative or estate, or transfer to a substituted performer, if any, all money paid on the contract.

    Sec. 142.  NRS 689.365 is hereby amended to read as follows:

    689.365  1.  An executory prepaid contract automatically terminates if the seller or any performer under the contract goes out of business, dies, becomes insolvent or bankrupt, makes an assignment for the benefit of creditors or is otherwise unable to fulfill the obligations under the contract unless, within 30 days after the going out of business, death, insolvency or bankruptcy of the seller, or within any extension of time granted by the commissioner, the contract is assigned to a holder of a valid seller’s certificate of authority who agrees in writing to accept the liabilities under the contract and agrees to fulfill all obligations set forth therein.

    2.  Upon any such termination, the money in the trust fund , including earned interest, held by the trustee for the account of the buyer must be distributed by the trustee to the buyer or to a qualified seller or performer assuming the outstanding contractual liabilities, as authorized by the commissioner.


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assuming the outstanding contractual liabilities, as authorized by the commissioner.

    Sec. 143.  NRS 689.485 is hereby amended to read as follows:

    689.485  1.  It is unlawful for any cemetery authority, or any person on behalf of a cemetery authority, to offer or sell any burial merchandise or services under a prepaid contract unless the cemetery authority has been issued a seller’s permit by the commissioner.

    2.  Subsection 1 does not apply to cemeteries owned and operated by governmental agencies.

    3.  A person who offers or sells any burial merchandise or services under a prepaid contract in this state in violation of the provisions of this section is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 144.  NRS 689.515 is hereby amended to read as follows:

    689.515  1.  It is unlawful for any person to solicit the sale of a prepaid contract in this state on behalf of a seller unless he holds a valid agent’s license issued by the commissioner.

    2.  This section does not apply to a seller who holds a valid seller’s permit.

    3.  A person who solicits the sale of a prepaid contract in this state without a license or seller’s permit is subject to an administrative fine of not more than $1,000 for each violation.

    Sec. 145.  NRS 689.575 is hereby amended to read as follows:

    689.575  1.  Except as otherwise provided in subsection 2, if the buyer moves to another geographic area beyond the normal service facilities of the seller and performers under the prepaid burial merchandise and service contract, the contract automatically terminates upon the buyer’s written notice to the seller and trustee of his move and of his desire to terminate the contract. The trustee, as soon as reasonably possible after receipt of the notice, shall refund to the buyer all money , including earned interest, in the trust fund held [to] for the buyer’s account.

    2.  If the contract continues in force and the buyer is not in default thereunder, upon the demise of the buyer, the contract automatically terminates. Upon termination, the seller shall:

    (a) Furnish the merchandise and perform or arrange to perform the services;

    (b) Make arrangements for the fulfillment of the agreement on a dollar-for-dollar basis with another performer serving the area to which the buyer has moved; or

    (c) Refund to the buyer or his representative or estate, or transfer to a substituted performer, all money , including earned interest, in the trust fund held [to] for the buyer’s account.

    3.  The cemetery authority shall include a provision in each prepaid contract substantially stating: “If the purchaser defaults in making any payment under this contract, the cemetery authority may terminate the contract and is entitled to retain as damages not more than 40 percent of the total purchase price. The balance remaining, if any, must be refunded to the purchaser.”

    Sec. 146.  NRS 689.580 is hereby amended to read as follows:

    689.580  1.  An executory prepaid contract automatically terminates if the seller or any performer under the contract goes out of business, dies, becomes insolvent or bankrupt, makes an assignment for the benefit of creditors or is otherwise unable to fulfill the obligations under the contract, unless the successors or assignees of the business agree to accept all liability and to fulfill all obligations as originally set forth in the contract.


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ê2001 Statutes of Nevada, Page 2218 (Chapter 446, AB 618)ê

 

creditors or is otherwise unable to fulfill the obligations under the contract, unless the successors or assignees of the business agree to accept all liability and to fulfill all obligations as originally set forth in the contract.

    2.  Upon any such termination, the money in the trust fund , including earned interest, held by the trustee for the account of the buyer must be distributed by the trustee to the buyer or to a qualified seller or performer assuming the outstanding contractual liabilities, as authorized by the commissioner.

    Sec. 147.  NRS 689.595 is hereby amended to read as follows:

    689.595  1.  The provisions of NRS [683A.450 to 683A.480, inclusive, and] 683A.480 and sections 93, 94 and 99 of this act and NRS 686A.010 to 686A.310, inclusive, apply to agents and sellers.

    2.  For the purposes of subsection 1, unless the context requires that a section apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “agent” and “seller.”

    3.  The provisions of NRS 679B.230 to 679B.300, inclusive, apply to sellers. Unless the context requires that a provision apply only to insurers, any reference in those sections to “insurer” must be replaced by a reference to “seller.”

    Sec. 148.  NRS 689A.041 is hereby amended to read as follows:

    689A.041  1.  [Any] A policy of health insurance which provides coverage for the surgical procedure known as a mastectomy must also provide commensurate coverage for [at least two prosthetic devices and for reconstructive surgery incident to the mastectomy. Except as otherwise provided in subsection 2, this coverage must be subject to the same terms and conditions that apply to the coverage for the mastectomy.] :

    (a) Reconstruction of the breast on which the mastectomy has been performed;

    (b) Surgery and reconstruction of the other breast to produce a symmetrical structure; and

    (c) Prostheses and physical complications for all stages of mastectomy, including lymphedemas.

    2.  The provision of services must be determined by the attending physician and the patient.

    3.  The plan or issuer may require deductibles and coinsurance payments if they are consistent with those established for other benefits.

    4.  Written notice of the availability of the coverage must be given upon enrollment and annually thereafter. The notice must be sent to all participants:

    (a) In the next mailing made by the plan or issuer to the participant or beneficiary; or

    (b) As part of any annual information packet sent to the participant or beneficiary,

whichever is earlier.

    5.  A plan or issuer may not:

    (a) Deny eligibility, or continued eligibility, to enroll or renew coverage, in order to avoid the requirements of subsections 1 to 4, inclusive; or

    (b) Penalize, or limit reimbursement to, a provider of care, or provide incentives to a provider of care, in order to induce the provider not to provide the care listed in subsections 1 to 4, inclusive.

    6.  A plan or issuer may negotiate rates of reimbursement with providers of care.


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    7.  If reconstructive surgery is begun within 3 years after a mastectomy, the amount of the benefits for that surgery must equal the amounts provided for in the policy at the time of the mastectomy. If the surgery is begun more than 3 years after the mastectomy, the benefits provided are subject to all of the terms, conditions and exclusions contained in the policy at the time of the reconstructive surgery.

    [3.] 8.  A policy subject to the provisions of this chapter which is delivered, issued for delivery or renewed on or after October 1, [1989,] 2001, has the legal effect of including the coverage required by this section, and any provision of the policy or the renewal which is in conflict with this section is void.

    [4.] 9.  For the purposes of this section, “reconstructive surgery” means a surgical procedure performed following a mastectomy on one breast or both breasts to reestablish symmetry between the two breasts. The term includes [, but is not limited to,] augmentation mammoplasty, reduction mammoplasty and mastopexy.

    Sec. 149.  NRS 689A.500 is hereby amended to read as follows:

    689A.500  “Converted policy” means a basic or standard health benefit plan issued in accordance with NRS 689B.120 to [689B.240,] 689B.210, inclusive, and 689B.590.

    Sec. 150.  Chapter 689B of NRS is hereby amended by adding thereto the provisions set forth as sections 151, 152 and 153 of this act.

    Sec. 151.  “Blanket accident and health insurance” has the meaning ascribed to it in NRS 689B.070.

    Sec. 152.  1.  An insurer shall provide to each policyholder, or producer of insurance acting on behalf of a policyholder, on a form approved by the commissioner, a summary of the coverage provided by each policy of group or blanket health insurance offered by the insurer. The summary must disclose any:

    (a) Significant exception, reduction or limitation that applies to the policy;

    (b) Restriction on payment for care in an emergency, including related definitions of emergency and medical necessity;

    (c) Right of the insurer to change the rate of premium and the factors, other than claims experienced, which affect changes in rate;

    (d) Provisions relating to renewability;

    (e) Provisions relating to preexisting conditions; and

    (f) Other information that the commissioner finds necessary for full and fair disclosure of the provisions of the policy.

    2.  The language of the disclosure must be easily understood. The disclosure must state that it is only a summary of the policy and that the policy should be read to ascertain the governing contractual provisions.

    3.  The commissioner shall not approve a proposed disclosure that does not satisfy the requirements of this section and of applicable regulations.

    4.  In addition to the disclosure, the insurer shall provide information about guaranteed availability of basic and standard plans for benefits to an eligible person.

    5.  The insurer shall provide the summary before the policy is issued.

    Sec. 153.  An insurer providing blanket health insurance shall make all information concerning rates available to the commissioner upon request. The information is proprietary, constitutes a trade secret, and may not be disclosed by the commissioner to any person outside the division except as agreed by the insurer or ordered by a court of competent jurisdiction.


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except as agreed by the insurer or ordered by a court of competent jurisdiction.

    Sec. 154.  NRS 689B.010 is hereby amended to read as follows:

    689B.010  1.  This chapter may be cited as the Group or Blanket Health Insurance Law.

    2.  This chapter applies only to group health insurance contracts and to blanket accident and health insurance contracts as provided [for] in this chapter.

    Sec. 155.  NRS 689B.0375 is hereby amended to read as follows:

    689B.0375  1.  [Any] A policy of group health insurance which provides coverage for the surgical procedure known as a mastectomy must also provide commensurate coverage for [at least two prosthetic devices and for reconstructive surgery incident to the mastectomy. Except as otherwise provided in subsection 2, this coverage must be subject to the same terms and conditions that apply to the coverage for the mastectomy.] :

    (a) Reconstruction of the breast on which the mastectomy has been performed;

    (b) Surgery and reconstruction of the other breast to produce a symmetrical structure; and

    (c) Prostheses and physical complications for all stages of mastectomy, including lymphedemas.

    2.  The provision of services must be determined by the attending physician and the patient.

    3.  The plan or issuer may require deductibles and coinsurance payments if they are consistent with those established for other benefits.

    4.  Written notice of the availability of the coverage must be given upon enrollment and annually thereafter. The notice must be sent to all participants:

    (a) In the next mailing made by the plan or issuer to the participant or beneficiary; or

    (b) As part of any annual information packet sent to the participant or beneficiary,

whichever is earlier.

    5.  A plan or issuer may not:

    (a) Deny eligibility, or continued eligibility, to enroll or renew coverage, in order to avoid the requirements of subsections 1 to 4, inclusive; or

    (b) Penalize, or limit reimbursement to, a provider of care, or provide incentives to a provider of care, in order to induce the provider not to provide the care listed in subsections 1 to 4, inclusive.

    6.  A plan or issuer may negotiate rates of reimbursement with providers of care.

    7.  If reconstructive surgery is begun within 3 years after a mastectomy, the amount of the benefits for that surgery must equal those amounts provided for in the policy at the time of the mastectomy. If the surgery is begun more than 3 years after the mastectomy, the benefits provided are subject to all of the terms, conditions and exclusions contained in the policy at the time of the reconstructive surgery.

    [3.] 8.  A policy subject to the provisions of this chapter which is delivered, issued for delivery or renewed on or after October 1, [1989,] 2001, has the legal effect of including the coverage required by this section, and any provision of the policy or the renewal which is in conflict with this section is void.


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    [4.] 9.  For the purposes of this section, “reconstructive surgery” means a surgical procedure performed following a mastectomy on one breast or both breasts to reestablish symmetry between the two breasts. The term includes [, but is not limited to,] augmentation mammoplasty, reduction mammoplasty and mastopexy.

    Sec. 156.  NRS 689B.070 is hereby amended to read as follows:

    689B.070  “Blanket accident and health insurance” is that form of accident insurance, health insurance , or both, covering groups of persons as enumerated in one of the following subsections under a policy or contract issued to:

    1.  Any common carrier or to any operator, owner or lessee of a means of transportation, who or which shall be deemed the policyholder, covering a group of persons who may become passengers defined by reference to their travel status on [such] the common carrier or [such] means of transportation.

    2.  An employer, who shall be deemed the policyholder, covering any group of employees, dependents or guests, defined by reference to specified hazards incident to an activity or activities or operations of the policyholder.

    3.  A college, school or other institution of learning, a school district or districts, or school jurisdictional unit, or to the head, principal or governing board of any such educational unit, who or which shall be deemed the policyholder, covering students, teachers or employees.

    4.  A religious, charitable, recreational, educational or civic organization, or branch thereof, which shall be deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or activities or operations sponsored or supervised by [such] the policyholder.

    5.  A sports team, camp or sponsor thereof, which shall be deemed the policyholder, covering members, campers, employees, officials or supervisors.

    6.  A volunteer fire department, organization providing first aid, organization for emergency management or other such volunteer organization, which shall be deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or activities or operations sponsored or supervised by [such] the policyholder.

    7.  A newspaper or other publisher, which shall be deemed the policyholder, covering its carriers.

    8.  An association, including a labor union, which has a constitution and bylaws and which has been organized and is maintained in good faith for purposes other than that of obtaining insurance, which shall be deemed the policyholder, covering any group of members or participants defined by reference to specified hazards incident to an activity or activities or operations sponsored or supervised by [such] the policyholder.

    9.  Cover any other risk or class of risks which, in the discretion of the commissioner, may be properly eligible for blanket accident and health insurance. The discretion of the commissioner may be exercised on the basis of an individual risk or class of risks, or both.

    Sec. 157.  NRS 689B.080 is hereby amended to read as follows:

    689B.080  Any insurer authorized to write health insurance in this state, including a nonprofit corporation for hospital, medical or dental services that has a certificate of authority issued pursuant to chapter 695B of NRS, may issue blanket accident and health insurance. No blanket policy, except as provided in subsection 4 of NRS 687B.120, may be issued or delivered in this state unless a copy of the form thereof has been filed in accordance with NRS 687B.120.


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provided in subsection 4 of NRS 687B.120, may be issued or delivered in this state unless a copy of the form thereof has been filed in accordance with NRS 687B.120. Every blanket policy must contain provisions which in the opinion of the commissioner are not less favorable to the policyholder and the individual insured than the following:

    1.  A provision that the policy, including endorsements and a copy of the application, if any, of the policyholder and the persons insured constitutes the entire contract between the parties, and that any statement made by the policyholder or by a person insured is in the absence of fraud a representation and not a warranty, and that no such statements may be used in defense to a claim under the policy, unless contained in a written application. The insured, his beneficiary or assignee has the right to make a written request to the insurer for a copy of an application, and the insurer shall, within 15 days after the receipt of a request at its home office or any branch office of the insurer, deliver or mail to the person making the request a copy of the application. If a copy is not so delivered or mailed, the insurer is precluded from introducing the application as evidence in any action based upon or involving any statements contained therein.

    2.  A provision that written notice of sickness or of injury must be given to the insurer within 20 days after the date when the sickness or injury occurred. Failure to give notice within that time does not invalidate or reduce any claim if it is shown that it was not reasonably possible to give notice and that notice was given as soon as was reasonably possible.

    3.  A provision that the insurer will furnish to the claimant or to the policyholder for delivery to the claimant such forms as are usually furnished by it for filing proof of loss. If the forms are not furnished before the expiration of 15 days after giving written notice of sickness or injury, the claimant shall be deemed to have complied with the requirements of the policy as to proof of loss upon submitting, within the time fixed in the policy for filing proof of loss, written proof covering the occurrence, the character and the extent of the loss for which claim is made.

    4.  A provision that in the case of a claim for loss of time for disability, written proof of the loss must be furnished to the insurer within 90 days after the commencement of the period for which the insurer is liable, and that subsequent written proofs of the continuance of the disability must be furnished to the insurer at such intervals as the insurer may reasonably require, and that in the case of a claim for any other loss, written proof of the loss must be furnished to the insurer within 90 days after the date of the loss. Failure to furnish such proof within that time does not invalidate or reduce any claim if it is shown that it was not reasonably possible to furnish proof and that the proof was furnished as soon as was reasonably possible.

    5.  A provision that all benefits payable under the policy other than benefits for loss of time will be payable immediately upon receipt of written proof of loss, and that, subject to proof of loss, all accrued benefits payable under the policy for loss of time will be paid not less frequently than monthly during the continuance of the period for which the insurer is liable, and that any balance remaining unpaid at the termination of that period will be paid immediately upon receipt of proof.

    6.  A provision that the insurer at its own expense has the right and opportunity to examine the person of the insured when and so often as it may reasonably require during the pendency of claim under the policy and also the right and opportunity to make an autopsy where it is not prohibited by law.


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the right and opportunity to make an autopsy where it is not prohibited by law.

    7.  A provision, if applicable, setting forth the provisions of NRS 689B.035.

    8.  A provision for benefits for expense arising from care at home or health supportive services if that care or service was prescribed by a physician and would have been covered by the policy if performed in a medical facility or facility for the dependent as defined in chapter 449 of NRS.

    9.  A provision that no action at law or in equity may be brought to recover under the policy before the expiration of 60 days after written proof of loss has been furnished in accordance with the requirements of the policy and that no such action may be brought after the expiration of 3 years after the time written proof of loss is required to be furnished.

    Sec. 158.  NRS 689B.130 is hereby amended to read as follows:

    689B.130  Subject to the conditions set forth in NRS 689B.120 to [689B.240,] 689B.210, inclusive, the conversion privilege must also be made available:

    1.  To the surviving spouse, if any, upon the death of the employee or member, with respect to the spouse and any child whose coverage under the group policy is terminated by reason of [such] the death, or if there is no surviving spouse, to each surviving child whose coverage under the group policy terminates by reason of [such] the death, or, if the group policy provides for continuation of dependents’ coverage following the employee’s or member’s death, at the end of the continued coverage;

    2.  To the spouse of the employee or member upon termination of coverage of the spouse while the employee or member remains insured under the group policy, if the spouse ceases to be a qualified family member under the group policy, and to any child whose coverage under the group policy terminates at the same time; or

    3.  To a child solely with respect to himself upon termination of his coverage because he ceases to be a qualified family member under the group policy, if a conversion privilege is not otherwise provided with respect to the termination.

    Sec. 159.  NRS 689B.150 is hereby amended to read as follows:

    689B.150  [1.]  A person who is entitled to a converted policy must be given his choice of [at least three types of policies offering benefits on an expense-incurred basis.

    2.  At least one choice among the three types of policies must include major medical or catastrophic benefits if they were provided under the group policy.

    3.  For those insureds eligible for Medicare, the insurer may provide a supplement to Medicare as the converted policy.] a basic or standard health benefit plan in the manner provided in NRS 689B.590.

    Sec. 160.  NRS 689B.180 is hereby amended to read as follows:

    689B.180  The insurer shall:

    1.  Issue the converted policy , as described in NRS 689B.590, without evidence of insurability;

    2.  [Base] Establish the premium on the converted policies [for the first 12 months, and subsequent renewals, upon the insurer’s table of premium rates applicable to the age and class of risk of each person to be covered under the policy and to the type and amount of insurance provided. The frequency of premium payments must be the same as is customarily required by the insurer for the policy form and plan selected except that premium payments must not be required more often than quarterly;] in the manner provided in subsections 3, 4 and 5, or pursuant to subsection 6, of NRS 689B.590, and may not require that premiums be paid annually, semi-annually or quarterly unless so requested by the employee, a member or a dependent;


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ê2001 Statutes of Nevada, Page 2224 (Chapter 446, AB 618)ê

 

frequency of premium payments must be the same as is customarily required by the insurer for the policy form and plan selected except that premium payments must not be required more often than quarterly;] in the manner provided in subsections 3, 4 and 5, or pursuant to subsection 6, of NRS 689B.590, and may not require that premiums be paid annually, semi-annually or quarterly unless so requested by the employee, a member or a dependent;

    3.  Provide that the effective date of the converted policy is 12:01 a.m. on the day after the termination of insurance under the group policy; and

    4.  Provide that the converted policy covers the employee or member and his dependents who were covered by the group policy on the date of its termination. [At the option of the insurer, a] A separate converted policy may be issued to cover any dependent.

    Sec. 161.  NRS 689B.250 is hereby amended to read as follows:

    689B.250  Every insurer under a group health insurance contract or a blanket accident and health insurance contract and every state agency, for its records shall accept from:

    1.  A hospital the Uniform Billing and Claims Forms established by the American Hospital Association in lieu of its individual billing and claims forms.

    2.  An individual who is licensed to practice one of the health professions regulated by Title 54 of NRS such uniform health insurance claims forms as the commissioner shall prescribe, except in those cases where the commissioner has excused uniform reporting.

    Sec. 162.  NRS 689B.340 is hereby amended to read as follows:

    689B.340  As used in NRS 689B.340 to 689B.600, inclusive, unless the context otherwise requires, the words and terms defined in NRS 689B.350 to 689B.460, inclusive, and section 151 of this act have the meanings ascribed to them in those sections.

    Sec. 163.  NRS 689B.380 is hereby amended to read as follows:

    689B.380  “Creditable coverage” means health benefits or coverage provided to a person pursuant to:

    1.  A group health plan;

    2.  A health benefit plan;

    3.  Part A or Part B of Title XVIII of the Social Security Act, 42 U.S.C. §§ 1395c et seq., also known as Medicare;

    4.  Title XIX of the Social Security Act, 42 U.S.C. §§ 1396 et seq., also known as Medicaid, other than coverage consisting solely of benefits under section 1928 of that Title, 42 U.S.C. § 1396s;

    5.  The Civilian Health and Medical Program of Uniformed Services, CHAMPUS, 10 U.S.C. §§ 1071 et seq.;

    6.  A medical care program of the Indian Health Service or of a tribal organization;

    7.  A state health benefit risk pool;

    8.  A health plan offered pursuant to the Federal Employees Health Benefits Program, FEHBP, 5 U.S.C. §§ 8901 et seq.;

    9.  A public health plan as defined in 45 C.F.R. § 146.113, authorized by the Public Health Service Act, 42 U.S.C. § 300gg(c)(1)(I);

    10.  A health benefit plan under section 5(e) of the Peace Corps Act, 22 U.S.C. § 2504(e);

    11.  The children’s health insurance program established pursuant to 42 U.S.C. §§ 1397aa to 1397jj, inclusive;


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ê2001 Statutes of Nevada, Page 2225 (Chapter 446, AB 618)ê

 

    12.  A short-term health insurance policy; or

    13.  A blanket [student] accident and health insurance policy.

    Sec. 164.  NRS 689B.490 is hereby amended to read as follows:

    689B.490  1.  For the purpose of determining the period of creditable coverage of a person accumulated under a health benefit plan , blanket accident and health insurance or group health insurance, the insurer shall provide written certification on a form prescribed by the commissioner of coverage to the person which certifies the length of:

    (a) The period of creditable coverage that the person accumulated under the plan and any coverage under any provision of the Consolidated Omnibus Budget Reconciliation Act of 1985, as that act existed on July 16, 1997, relating to the continuation of coverage; and

    (b) Any waiting and affiliation period imposed on the person pursuant to that coverage.

    2.  The certification of coverage must be provided to the person who was insured:

    (a) At the time that he ceases to be covered under the plan, if he does not otherwise become covered under any provision of the Consolidated Omnibus Budget Reconciliation Act of 1985, as that act existed on July 16, 1997, relating to the continuation of coverage;

    (b) If he becomes covered under such a provision, at the time that he ceases to be covered by that provision; and

    (c) Upon request, if the request is made not later than 24 months after the date on which he ceased to be covered as described in paragraphs (a) and (b).

    Sec. 165.  NRS 689B.500 is hereby amended to read as follows:

    689B.500  1.  Except as otherwise provided in this section, a carrier that issues a group health plan or coverage under blanket accident and health insurance or group health insurance shall not deny, exclude or limit a benefit for a preexisting condition for:

    (a) More than 12 months after the effective date of coverage if the employee or other insured enrolls through open enrollment or after the first day of the waiting period for that enrollment, whichever is earlier; or

    (b) More than 18 months after the effective date of coverage for a late enrollee.

A carrier may not define a preexisting condition more restrictively than that term is defined in NRS 689B.450.

    2.  The period of any exclusion for a preexisting condition imposed by a group health plan or coverage under blanket accident and health insurance or group health insurance on a person to be insured in accordance with the provisions of this chapter must be reduced by the aggregate period of creditable coverage of that person, if the creditable coverage was continuous to a date not more than 63 days before the effective date of the coverage. The period of continuous coverage must not include:

    (a) Any waiting period for the effective date of the new coverage applied by the employer or the carrier; or

    (b) Any affiliation period not to exceed 60 days for a new enrollee and 90 days for a late enrollee required before becoming eligible to enroll in the group health plan.

    3.  A health maintenance organization authorized to transact insurance pursuant to chapter 695C of NRS that does not restrict coverage for a preexisting condition may require an affiliation period before coverage becomes effective under a plan of insurance if the affiliation period applies uniformly to all employees or other persons insured and without regard to any health status-related factors.


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ê2001 Statutes of Nevada, Page 2226 (Chapter 446, AB 618)ê

 

uniformly to all employees or other persons insured and without regard to any health status-related factors. During the affiliation period, the carrier shall not collect any premiums for coverage of the employee [.] or other insured.

    4.  An insurer that restricts coverage for preexisting conditions shall not impose an affiliation period.

    5.  A carrier shall not impose any exclusion for a preexisting condition:

    (a) Relating to pregnancy.

    (b) In the case of a person who, as of the last day of the 30-day period beginning on the date of his birth, is covered under creditable coverage.

    (c) In the case of a child who is adopted or placed for adoption before attaining the age of 18 years and who, as of the last day of the 30-day period beginning on the date of adoption or placement for adoption, whichever is earlier, is covered under creditable coverage. The provisions of this paragraph do not apply to coverage before the date of adoption or placement for adoption.

    (d) In the case of a condition for which medical advice, diagnosis, care or treatment was recommended or received for the first time while the covered person held creditable coverage, and the medical advice, diagnosis, care or treatment was a benefit under the plan, if the creditable coverage was continuous to a date not more than 63 days before the effective date of the new coverage.

The provisions of paragraphs (b) and (c) do not apply to a person after the end of the first 63-day period during all of which the person was not covered under any creditable coverage.

    6.  As used in this section, “late enrollee” means an eligible employee, or his dependent, who requests enrollment in a group health plan following the initial period of enrollment, if that initial period of enrollment is at least 30 days, during which the person is entitled to enroll under the terms of the health benefit plan. The term does not include an eligible employee or his dependent if:

    (a) The employee or dependent:

         (1) Was covered under creditable coverage at the time of the initial enrollment;

         (2) Lost coverage under creditable coverage as a result of cessation of contributions by his employer, termination of employment or eligibility, reduction in the number of hours of employment, involuntary termination of creditable coverage, or death of, or divorce or legal separation from, a covered spouse; and

         (3) Requests enrollment not later than 30 days after the date on which his creditable coverage was terminated or on which the change in conditions that gave rise to the termination of the coverage occurred.

    (b) The employee enrolls during the open enrollment period, as provided in the contract or as otherwise specifically provided by specific statute.

    (c) The employer of the employee offers [multiple] several health benefit plans and the employee elected a different plan during an open enrollment period.

    (d) A court has ordered coverage to be provided to the spouse or a minor or dependent child of an employee under a health benefit plan of the employee and a request for enrollment is made within 30 days after the issuance of the court order.


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    (e) The employee changes status from not being an eligible employee to being an eligible employee and requests enrollment, subject to any waiting period, within 30 days after the change in status.

    (f) The person has continued coverage in accordance with the Consolidated Omnibus Budget Reconciliation Act of 1985, Public Law 99-272, and that coverage has been exhausted.

    Sec. 166.  NRS 689B.550 is hereby amended to read as follows:

    689B.550  1.  A carrier shall not place any restriction on a person or his dependent as a condition of being a participant in or a beneficiary of a policy of blanket accident and health insurance or group health insurance that is inconsistent with the provisions of this chapter.

    2.  A carrier that offers coverage under a policy of blanket accident and health insurance or group health insurance pursuant to this chapter shall not establish rules of eligibility, including [, but not limited to,] rules which define applicable waiting periods, for the initial or continued enrollment under [the] a group health plan offered by the carrier that are based on the following factors relating to the employee or his dependent:

    (a) Health status.

    (b) Medical condition, including physical and mental illnesses, or both.

    (c) Claims experience.

    (d) Receipt of health care.

    (e) Medical history.

    (f) Genetic information.

    (g) Evidence of insurability, including conditions which arise out of acts of domestic violence.

    (h) Disability.

    3.  Except as otherwise provided in NRS 689B.500, the provisions of subsection 1 do not:

    (a) Require a carrier to provide particular benefits other than those that would otherwise be provided under the terms of the blanket health and accident insurance or group health insurance or coverage; or

    (b) Prevent a carrier from establishing limitations or restrictions on the amount, level, extent or nature of the benefits or coverage for similarly situated persons.

    4.  As a condition of enrollment or continued enrollment under a policy of blanket accident and health insurance or group health insurance, a carrier shall not require an employee to pay a premium or contribution that is greater than the premium or contribution for a similarly situated person covered by similar coverage on the basis of any factor described in subsection 2 in relation to the employee or his dependent.

    5.  [Nothing in this section:

    (a) Restricts] This section does not:

    (a) Restrict the amount that an employer or employee may be charged for coverage by a carrier;

    (b) [Prevents] Prevent a carrier from establishing premium discounts or rebates or from modifying otherwise applicable copayments or deductibles in return for adherence by the insured person to programs of health promotion and disease prevention; or

    (c) [Precludes] Preclude a carrier from establishing rules relating to employer contribution or group participation when offering health insurance coverage to small employers in this state.


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ê2001 Statutes of Nevada, Page 2228 (Chapter 446, AB 618)ê

 

    Sec. 166.5.  NRS 690C.160 is hereby amended to read as follows:

    690C.160  1.  A provider who wishes to issue, sell or offer for sale service contracts in this state must submit to the commissioner:

    (a) A registration application on a form prescribed by the commissioner;

    (b) Proof that he has complied with the requirements for security set forth in NRS 690C.170;

    (c) A copy of each type of service contract he proposes to issue, sell or offer for sale;

    (d) The name, address and telephone number of each administrator with whom the provider intends to contract; and

    (e) A fee of $1,000.

    2.  In addition to the fee required by subsection 1, a provider must pay a fee of $25 for each type of service contract he files with the commissioner.

    3.  A certificate of registration is valid for 1 year after the date the commissioner issues the certificate to the provider. A provider may renew his certificate of registration if, before the certificate expires, he submits to the commissioner an application on a form prescribed by the commissioner and a fee of [$500.] $1,000.

    Sec. 167.  NRS 692A.1045 is hereby amended to read as follows:

    692A.1045  1.  The commissioner shall establish by regulation the fees to be paid by title agents and title insurers for [the] their supervision and examination [of such agents and insurers] by the commissioner or his representative.

    2.  In establishing the fees pursuant to subsection 1, the commissioner shall consider:

    (a) The complexity of the various examinations to which the fees apply;

    (b) The skill required to conduct such examinations;

    (c) The expenses associated with conducting such examinations and preparing reports; and

    (d) Any other factors the commissioner deems relevant.

    3.  The commissioner shall, with the approval of the commissioner of financial institutions, adopt regulations prescribing the standards for determining whether a title insurer or title agent has maintained adequate supervision of a title agent or [title] escrow officer pursuant to the provisions of this chapter.

    Sec. 168.  NRS 692A.270 is hereby amended to read as follows:

    692A.270  The provisions of NRS 683A.400, 683A.410 683A.480 and [683A.450 to 683A.490, inclusive,] 683A.490, and sections 93, 94 and 99 of this act apply to title insurers, title agents and escrow officers.

    Sec. 169.  Chapter 692C of NRS is hereby amended by adding thereto a new section to read as follows:

    An insurer, financial holding company, depositary institution or affiliate of any of them which proposes an acquisition or change or continuation of control of an insurer domiciled in this state shall give notice to the commissioner of the proposed action no later than 60 days before the proposed action is to become effective. During this period the commissioner may collect, review and act upon applications and other documents or reports relating to the proposed action under his authority conferred by this Title.


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ê2001 Statutes of Nevada, Page 2229 (Chapter 446, AB 618)ê

 

    Sec. 170.  NRS 692C.140 is hereby amended to read as follows:

    692C.140  In addition to making investments in common stock, preferred stock, debt obligations and other securities permitted under chapter 682A of NRS, a domestic insurer may invest:

    1.  In common stock, preferred stock, debt obligations and other securities of one or more subsidiaries, amounts which do not exceed the lesser of [5] 10 percent of [such] the insurer’s assets or 50 percent of [such insurer’s] its surplus as regards policyholders, [provided] if the insurer’s surplus as regards policyholders remains at a reasonable level in relation to the insurer’s outstanding liabilities and adequate to its financial needs. In calculating the amount of such investments [there shall] the following must be included:

    (a) Total [moneys] money or other consideration expended and obligations assumed in the acquisition or formation of a subsidiary, including all organizational expenses and contributions to capital and surplus of [such] the subsidiary whether or not represented by the purchase of capital stock or issuance of other securities; and

    (b) All amounts expended in acquiring additional common stock, preferred stock, debt obligations and other securities and all contributions to the capital or surplus of a subsidiary [subsequent to] after its acquisition or formation.

    2.  Any amount in common stock, preferred stock, debt obligations and other securities of one or more subsidiaries, [provided] if the insurer’s total liabilities, as calculated for the National Association of Insurance [Commissioners] Commissioners’ annual statement purposes, are less than 10 percent of assets and [provided] if the insurer’s surplus remains as regards policyholders, considering such investment as if it were a disallowed asset, at a reasonable level in relation to the insurer’s outstanding liabilities and adequate to its financial needs.

    3.  Any amount in common stock, preferred stock, debt obligations and other securities of one or more subsidiaries [provided] if each subsidiary agrees to limit its investments in any asset so that [such] those investments will not cause the amount of the total investment of the insurer to exceed any of the investment limitations specified in subsection 1 or in chapter 682A of NRS. For the purpose of this subsection, “total investment of the insurer” includes any direct investment by the insurer in an asset and the insurer’s proportionate share of any investment in an asset by any subsidiary of the insurer, which [shall] must be calculated by multiplying the amount of the subsidiary’s investment by the percentage of the insurer’s ownership of [such] the subsidiary.

    4.  Any amount in common stock, preferred stock, debt obligations or other securities of one or more subsidiaries, with the approval of the commissioner, [provided] if the insurer’s surplus as regards policyholders remains at a reasonable level in relation to the insurer’s outstanding liabilities and adequate to its financial needs.

    5.  Any amount in the common stock, preferred stock, debt obligations or other securities of any subsidiary exclusively engaged in holding title to or holding title to and managing or developing real or personal property, if after considering as a disallowed asset so much of the investment as is represented by subsidiary assets which if held directly by the insurer would be considered as a disallowed asset, the insurer’s surplus as regards policyholders will remain at a reasonable level in relation to the insurer’s outstanding liabilities and adequate to its financial needs, and if [following such] after the investment all voting securities of [such] the subsidiary are owned by the insurer.


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ê2001 Statutes of Nevada, Page 2230 (Chapter 446, AB 618)ê

 

outstanding liabilities and adequate to its financial needs, and if [following such] after the investment all voting securities of [such] the subsidiary are owned by the insurer.

    Sec. 171.  NRS 692C.180 is hereby amended to read as follows:

    692C.180  1.  No person other than the issuer [shall] may make a tender for or a request or invitation for tenders of, or enter into any agreement to exchange securities for, seek to acquire or acquire in the open market or otherwise, any voting security of a domestic insurer if, after the consummation thereof, [such person] he would directly or indirectly , [(] or by conversion or by exercise of any right to acquire , [)] be in control of [such] the insurer [.

    2.  No person shall] nor may any person enter into an agreement to merge with or otherwise acquire control of a domestic insurer , unless, at the time any such offer, request or invitation is made or any such agreement is entered into, or [prior to] before the acquisition of [such] those securities if no offer or agreement is involved, [such person] he has filed with the commissioner and has sent to [such] the insurer, and [such] the insurer has sent to its shareholders, a statement containing the information required by NRS 692C.180 to 692C.250, inclusive, and [such] the offer, request, invitation, agreement or acquisition has been approved by the commissioner in the manner prescribed in this chapter.

    [3.] 2.  For purposes of this section, a domestic insurer includes any other person controlling a domestic insurer unless [such] the other person is either directly or through its affiliates primarily engaged in business other than the business of insurance. However, a person primarily engaged in another business shall file a notice of intent to acquire, on a form prescribed by the commissioner, at least 60 days before the proposed effective date of the acquisition.

    Sec. 172.  NRS 692C.210 is hereby amended to read as follows:

    692C.210  1.  The commissioner shall approve any merger or other acquisition of control referred to in NRS 692C.180 unless, after a public hearing thereon, he finds that:

    (a) After the change of control the domestic insurer referred to in NRS 692C.180 would not be able to satisfy the requirements for the issuance of a license to write the line or lines of insurance for which it is presently licensed;

    (b) The effect of the merger or other acquisition of control would be substantially to lessen competition in insurance in this state or tend to create a monopoly therein;

    (c) The financial condition of any acquiring party is such as might jeopardize the financial stability of the insurer, or prejudice the interest of its policyholders or the interests of any remaining security holders who are unaffiliated with the acquiring party;

    (d) The terms of the offer, request, invitation, agreement or acquisition referred to in NRS 692C.180 are unfair and unreasonable to the security holders of the insurer;

    (e) The plans or proposals which the acquiring party has to liquidate the insurer, sell its assets or consolidate or merge it with any person, or to make any other material change in its business or corporate structure or management, are unfair and unreasonable to policyholders of the insurer and not in the public interest; or


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ê2001 Statutes of Nevada, Page 2231 (Chapter 446, AB 618)ê

 

    (f) The competence, experience and integrity of those persons who would control the operation of the insurer are such that it would not be in the interest of policyholders of the insurer and of the public to permit the merger or other acquisition of control.

    2.  The public hearing referred to in subsection 1 must be held within [a reasonable time] 30 days after the statement required by NRS 692C.180 has been filed, and at least 20 days’ notice thereof must be given by the commissioner to the person filing the statement. Not less than 7 days’ notice of the public hearing must be given by the person filing the statement to the insurer and to such other persons as may be designated by the commissioner. The insurer shall give such notice to its security holders. The commissioner shall make a determination within 30 days after the conclusion of the hearing. If he determines that an infusion of capital to restore capital in connection with the change in control, the requirement must be met within 60 days after notification is given of the determination. At the hearing, the person filing the statement, the insurer, any person to whom notice of hearing was sent, and any other person whose interests may be affected thereby may present evidence, examine and cross-examine witnesses, and offer oral and written arguments and in connection therewith may conduct discovery proceedings in the same manner as is presently allowed in the district court of this state. All discovery proceedings must be concluded not later than 3 days before the commencement of the public hearing.

    3.  The commissioner may retain at the acquiring party’s expense attorneys, actuaries, accountants and other experts not otherwise a part of his staff as may be reasonably necessary to assist him in reviewing the proposed acquisition of control.

    4.  The period for review by the commissioner must not exceed the 60 days allowed between the filing of the notice of intent to acquire and the date of proposed acquisition if the proposed affiliation or change of control involves a financial institution, or an affiliate of a financial institution, and an insured.

    Sec. 173.  NRS 692C.363 is hereby amended to read as follows:

    692C.363  1.  A domestic insurer shall not enter into any of the following transactions with an affiliate unless the insurer has notified the commissioner in writing of its intention to enter into the transaction at least [30] 60 days previously, or such shorter period as the commissioner may permit, and the commissioner has not disapproved it within that period:

    (a) A sale, purchase, exchange, loan or extension of credit, guaranty or investment if the transaction equals at least:

         (1) With respect to an insurer other than a life insurer, the [greater of 5] lesser of 3 percent of the insurer’s admitted assets or 25 percent of surplus as regards policyholders; or

         (2) With respect to a life insurer, [5] 3 percent of the insurer’s admitted assets,

computed as of December 31 next preceding the transaction.

    (b) A loan or extension of credit to any person who is not an affiliate, if the insurer makes the loan or extension of credit with the agreement or understanding that the proceeds of the transaction, in whole or in substantial part, are to be used to make loans or extensions of credit to, to purchase assets of, or to make investments in, any affiliate of the insurer if the transaction equals at least:


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ê2001 Statutes of Nevada, Page 2232 (Chapter 446, AB 618)ê

 

         (1) With respect to insurers other than life insurers, the [greater of 5] lesser of 3 percent of the insurer’s admitted assets or 25 percent of surplus as regards policyholders; or

         (2) With respect to life insurers, [5] 3 percent of the insurer’s admitted assets,

computed as of December 31 next preceding the transaction.

    (c) An agreement for reinsurance or a modification thereto in which the premium for reinsurance or a change in the insurer’s liabilities equals at least 5 percent of the insurer’s surplus as regards policyholders as of December 31 next preceding the transaction, including an agreement which requires as consideration the transfer of assets from an insurer to a nonaffiliate, if an agreement or understanding exists between the insurer and nonaffiliate that any portion of those assets will be transferred to an affiliate of the insurer.

    (d) An agreement for management [.] , contract for service, guarantee or arrangement to share costs.

    (e) A material transaction, specified by regulation, which the commissioner determines may adversely affect the interest of the insurer’s policyholders.

    2.  This section does not authorize or permit any transaction which, in the case of an insurer not an affiliate, would be contrary to law.

    Sec. 173.5.  Chapter 693A of NRS is hereby amended by adding thereto the provisions set forth as sections 174 to 226, inclusive, of this act.

    Sec. 174.  As used in sections 174 to 202, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 175 to 180, inclusive, of this act have the meanings ascribed to them in those sections.

    Sec. 175.  “Closed block” means an allocation of assets of the converting mutual sufficient to maintain payments of guaranteed benefits and the continuation of the current dividends for eligible members.

    Sec. 176.  “Consideration” means cash, stock or other valuable compensation approved by the commissioner.

    Sec. 177.  “Converting mutual” means a domestic mutual insurance company or a mutual insurance holding company that has adopted a plan of conversion to a domestic stock insurance company pursuant to sections 174 to 202, inclusive, of this act.

    Sec. 178.  “Eligible member” means a person who has a membership interest in the converting mutual on the date on which the board of directors of the converting mutual adopts a resolution proposing a plan of conversion and an amendment to its articles of incorporation.

    Sec. 179.  “New stock insurer” means the domestic stock insurer that is created when the commissioner issues a certificate of authority to a converting mutual pursuant to section 188 of this act.

    Sec. 180.  “Policyholder” means a person who holds a policy issued by the converting mutual on the day on which the plan of conversion is initially approved by the board of directors of the converting mutual.

    Sec. 181.  A domestic mutual insurer or a mutual insurance holding company may amend its articles of incorporation to become a domestic stock insurer by complying with sections 174 to 202, inclusive, of this act and obtaining a certificate of authority from the commissioner.

    Sec. 182.  1.  The board of directors of a domestic mutual insurer or a mutual insurance holding company may adopt a resolution proposing a plan of conversion and an amendment to its articles of incorporation. The resolution must be approved by a vote of not less than two-thirds of the members of the board.


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ê2001 Statutes of Nevada, Page 2233 (Chapter 446, AB 618)ê

 

resolution must be approved by a vote of not less than two-thirds of the members of the board.

    2.  The plan of conversion must:

    (a) Require the distribution of consideration equal to not less than the fair market value of the surplus of the converting mutual to the eligible members in exchange for the extinguishment of their membership interests in the converting mutual.

    (b) Describe the manner in which the fair market value of the converting mutual and its surplus has been or will be determined.

    (c) Require the distribution of consideration to the eligible members upon extinguishment of their membership interests in the converting mutual.

    (d) Provide that membership interests in the converting mutual are extinguished as of the effective date of conversion.

    (e) Specify the structure and form of the proposed consideration, including, without limitation, the projected range of the number of shares of capital stock to be:

         (1) Issued to policyholders by the new stock insurer or the holding company of the new stock insurer; and

         (2) Sold or reserved for sale to investors by the new stock insurer or the holding company of the new stock insurer, or to the trust established pursuant to this section.

    (f) If the distribution of consideration will not be made immediately following the final order of the commissioner approving the conversion, provide for the establishment of a trust for the exclusive benefit of policyholders into which shares of the capital stock of the new stock insurer or the holding company of the new stock insurer must be placed pending distribution to the policyholders. The terms of the trust are subject to the approval of the commissioner. Such a trust may exist only for a period of 6 months after the final approval of the conversion, during which time the distribution of consideration to eligible policyholders and other persons must be completed.

    (g) Provide for the determination of the reasonable dividend expectations of eligible members and other policyholders of policies that provide for distribution of policy dividends and the preservation of such expectations through the establishment of a closed block of assets.

    (h) Provide for such other proposed conditions and provisions as the board of directors of the converting mutual determines are necessary and are not inconsistent with the provisions of sections 174 to 202, inclusive, of this act.

    Sec. 183.  A converting mutual shall file with the commissioner an application to convert to a domestic stock insurer. The application must be accompanied by a nonrefundable fee of $2,450. The application must include, without limitation:

    1.  The plan of conversion adopted by the board of directors.

    2.  A certification that the plan of conversion was duly adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual.

    3.  A certification that the plan of conversion is fair and equitable to the policyholders. This certification must be adopted by a vote of not less than two-thirds of the members of the board of directors of the converting mutual.


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ê2001 Statutes of Nevada, Page 2234 (Chapter 446, AB 618)ê

 

    4.  A statement of the reasons for the proposed conversion and why the conversion is in the best interest of the converting mutual, including, without limitation, a:

    (a) Detailed analysis of the risks and benefits of the proposed conversion to the converting mutual and its members; and

    (b) Comparison of the risks and benefits of the conversion with the risks and benefits of a reasonable alternative to the conversion.

    5.  A written opinion addressed to the board of directors of the converting mutual from a qualified, independent financial advisor attesting that the:

    (a) Consideration to be provided to the membership of the converting mutual is fair to the eligible members as a group; and

    (b) Total consideration to be provided to the membership is equal to or greater than the surplus of the converting mutual.

    6.  An opinion from a qualified actuary attesting that all methodologies and formulas used to allocate the consideration among eligible members are reasonable.

    7.  Certified copies of the proposed amendments to the articles of incorporation and bylaws to effect the conversion.

    8.  A copy of the form of the trust agreement of any trust to be used in connection with the conversion.

    9.  A plan of operation for a closed block to preserve the reasonable dividend expectations of eligible members and other policyholders of policies that provide for the distribution of policy dividends.

    10.  A form of the proposed notice to be mailed by the converting mutual to its policyholders as required by section 186 of this act.

    11.  A 5-year business plan and at least 2 years of financial projections for the new stock insurer and a parent company, if any.

    12.  A list of natural persons who are or have been selected to become directors or officers of the new stock insurer and the following information concerning each person on the list, unless the information is already on file with the commissioner:

    (a) Occupation;

    (b) Criminal convictions, other than traffic violations, during the immediately preceding 7 years;

    (c) Personal bankruptcy of the person or the spouse of the person during the immediately preceding 7 years;

    (d) Information regarding any consent decree entered into by the person; and

    (e) Whether the person has been refused a fidelity or other bond during the immediately preceding 7 years.

    13.  Any plans that the new stock insurer or its parent company, if any, may have to:

    (a) Raise additional capital through the issuance of stock or otherwise;

    (b) Sell or issue stock to any person;

    (c) Liquidate or dissolve any company or sell any material assets;

    (d) Merge, consolidate or pursue any other form of reorganization with any person; or

    (e) Make any material change in its investment policy, business, corporate structure or management.

    14.  Copies of proposed articles of incorporation and any proposed bylaws of the new stock insurer.


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ê2001 Statutes of Nevada, Page 2235 (Chapter 446, AB 618)ê

 

    15.  Such additional information as the commissioner may by regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the converting mutual, or for the protection of the public interest.

    Sec. 184.  The commissioner shall conduct a public hearing not later than 120 days after the date on which the application is filed unless, for good cause, he extends this time. Any interested person may appear or otherwise be heard at the public hearing. The commissioner may continue the hearing for a reasonable period, not to exceed 60 days. The converting mutual shall give such reasonable notice of the hearing as the commissioner requires. The hearing must be conducted pursuant to NRS 679B.320 to 679B.370, inclusive.

    Sec. 185.  1.  The commissioner shall issue an order making an initial determination of approval or disapproval of the application not later than 30 days after the public hearing.

    2.  The commissioner shall not approve the application unless he finds that the:

    (a) Plan of conversion is fair and equitable to the policyholders;

    (b) Plan of conversion does not deprive the policyholders of their property rights or due process of law;

    (c) New stock insurer meets the minimum requirements for a certificate of authority to transact the business of insurance in this state; and

    (d) Continued operation of the new stock insurer is not hazardous to future policyholders and the public.

    3.  For the purposes of this section, the commissioner may consider any relevant factor, including, without limitation:

    (a) The capital requirements of the new stock insurer;

    (b) Whether a sufficient portion of the surplus of the converting mutual was contributed by persons or entities whose policies or contracts were not in force on the date on which the plan of conversion was initially approved by the board of directors of the converting mutual to require the reduction of the consideration to policyholders to an amount equal to less than the surplus;

    (c) Whether the plan of conversion includes preemptive rights for policyholders to purchase securities offered in the initial sale of securities by the new stock insurer;

    (d) Whether the plan of conversion includes establishment of a preference account from which the payment of any shareholder dividends, including a regular, special or liquidation dividend, would be prohibited for such a reasonable period as the commissioner may require;

    (e) The suitability of the trustees of any trust created to effect the conversion; and

    (f) Whether the utilization of a trust, if included in the plan of conversion, has a material adverse effect on policyholders, other than delaying the receipt of shares of capital stock.

    4.  If the commissioner makes a determination to disapprove the application, the commissioner shall issue a final order setting forth specific findings for the disapproval.

    Sec. 186.  1.  Unless the commissioner for good cause establishes a different time, the converting mutual shall, not less than 45 days after the date of the initial determination of approval by the commissioner, hold a meeting of its policyholders at a reasonable time and place to vote upon the plan of conversion.


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ê2001 Statutes of Nevada, Page 2236 (Chapter 446, AB 618)ê

 

meeting of its policyholders at a reasonable time and place to vote upon the plan of conversion.

    2.  The converting mutual shall give notice not less than 30 days before the meeting, by first-class mail to the last known address of each policyholder, that the plan of conversion will be voted upon at a regular or special meeting of the policyholders. The notice must include, without limitation, a:

    (a) Brief description of the plan of conversion;

    (b) Statement that the commissioner has initially approved the plan of conversion; and

    (c) Written proxy permitting the policyholder to vote for or against the plan of conversion.

    3.  The commissioner shall supervise and direct the conducting of the vote on the plan of conversion as necessary to ensure that the vote is fair and consistent with the requirements of this section. Each policyholder is entitled to only one vote regardless of the number of policies owned by the policyholder.

    4.  A plan of conversion is approved only if not less than two-thirds of the policyholders voting in person or by proxy at the meeting vote in favor of the plan of conversion.

    5.  For the purposes of notice and voting, the policyholder of a policy of group insurance is the entity to which the group policy is issued and not any person covered under the group policy.

    Sec. 187.  A converting mutual may, by not less than a two-thirds vote of the members of its board of directors and with the approval of the commissioner, abandon the plan of conversion at any time before the issuance of the certificate of authority by the commissioner pursuant to section 188 of this act. Upon abandonment, all rights and obligations arising out of the plan of conversion terminate and the converting mutual shall continue to conduct its business as a domestic mutual insurer or a mutual insurance holding company as though no plan of conversion had ever been adopted.

    Sec. 188.  1.  The commissioner shall:

    (a) Enter a final order approving the application to convert to a stock insurer within 10 days after receiving a valid certification from the converting mutual setting forth the vote and certifying that the plan of conversion was approved by not less than two-thirds of the policyholders voting in person or by proxy on the plan of conversion; and

    (b) Publish notification of the issuance of the final order in a newspaper of general circulation in Carson City and in the county of domicile of the converting mutual if different from Carson City.

    2.  Except as otherwise provided in section 187 of this act, the commissioner shall issue a certificate of authority to the new stock insurer when the converting mutual files a certificate with the commissioner stating that all the conditions set forth in the plan of conversion have been satisfied.

    3.  The conversion is effective upon the issuance of the certificate of authority by the commissioner.

    4.  Upon issuance of the certificate of authority, the articles of incorporation of the insurer shall be deemed to be amended in compliance with NRS 692B.030.


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ê2001 Statutes of Nevada, Page 2237 (Chapter 446, AB 618)ê

 

    Sec. 189.  Any person aggrieved by a final order of the commissioner issued pursuant to sections 174 to 202, inclusive, of this act may petition for judicial review in the manner provided by chapter 233B of NRS.

    Sec. 190.  In determining whether a plan of conversion meets the requirements of sections 174 to 202, inclusive, of this act, or with regard to any other matters relating to the development of a plan of conversion, the commissioner may engage the services of experts. All reasonable costs related to the review of a plan of conversion or such other matters, including those costs attributable to the use of experts, must be paid by the converting mutual filing the application or initiating discussions with the commissioner about such matters.

    Sec. 191.  1.  Except as otherwise provided in subsection 2, all information and documents obtained by or disclosed to the commissioner or any other person in the course of preparing, filing and processing an application of a converting mutual, other than information and documents distributed to policyholders in connection with the meeting of policyholders pursuant to section 186 of this act or filed or submitted as evidence in connection with the public hearing pursuant to section 184 of this act, are confidential and not subject to subpoena, and must not be made public by the commissioner, the National Association of Insurance Commissioners or any other person, except to insurance departments of other states, without the prior written consent of the insurer to which such information and documents pertain.

    2.  If the commissioner, after giving the insurer and its affiliates who would be affected notice and opportunity to be heard, determines that the interests of policyholders, shareholders or the public will be best served by the publication of such information and documents, the commissioner may publish all or any part thereof in such a manner as he determines appropriate.

    Sec. 192.  Whenever it appears to the commissioner that any person or any director, officer, employee or agent of the person has committed or is about to commit a violation of any provision of sections 174 to 202, inclusive, of this act or of any regulation or order of the commissioner relating thereto, the commissioner may apply to the First Judicial District Court in and for Carson City for an order enjoining the person, director, officer, employee or agent from violating or continuing to violate any provision of sections 174 to 202, inclusive, of this act or any such regulation or order, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the insurer, or the public, may require.

    Sec. 193.  The corporate existence of a converting mutual pursuant to sections 174 to 202, inclusive, of this act does not terminate, and the new stock insurer shall be deemed to be a continuation of the converting mutual and to have been organized on the date the converting mutual was originally organized.

    Sec. 194.  The provisions of sections 174 to 202, inclusive, of this act do not prohibit the inclusion in the plan of conversion of provisions under which members of the board of directors, officers, employees or agents of the new stock insurer, and persons acting as trustees of employee stock ownership plans or other employee benefit plans may be entitled to purchase for cash capital stock of the new stock insurer at the same price initially issued by the new stock insurer under the plan of conversion, except that no such purchase may be made while any shares of capital stock are held in a trust established pursuant to the plan of conversion.


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ê2001 Statutes of Nevada, Page 2238 (Chapter 446, AB 618)ê

 

except that no such purchase may be made while any shares of capital stock are held in a trust established pursuant to the plan of conversion.

    Sec. 195.  1.  No director, officer, employee or agent of the converting mutual, or any other person, may receive any fee, commission or other valuable consideration, other than his usual regular salary and compensation, for aiding, promoting or assisting in a plan of conversion except as set forth in the plan of conversion approved by the commissioner.

    2.  Subsection 1 does not prohibit a management incentive compensation program that is contained in the plan of conversion and approved by the commissioner to be adopted upon conversion to the new stock insurer or prohibit such a program to be adopted later by the new stock insurer.

    3.  Subsection 1 does not prohibit the payment of reasonable fees and compensation to attorneys, accountants, actuaries and investment bankers for services performed in the independent practice of their professions if the person is also a member of the board of directors of the converting mutual.

    Sec. 196.  1.  Except as otherwise specifically provided in the plan of conversion, before and for a period of 5 years after the issuance of a certificate of authority to a new stock insurer pursuant to section 188 of this act, no person other than the new stock insurer may directly or indirectly offer to acquire or acquire in any manner the beneficial ownership of 5 percent or more of any class of a voting security of the new stock insurer or of any institution that owns a majority of the voting securities of the new stock insurer without the prior approval by the commissioner of an application for acquisition.

    2.  The commissioner shall not approve an application for acquisition filed pursuant to subsection 1 unless he finds that:

    (a) The acquisition will not frustrate the plan of conversion as approved by the policyholders and the commissioner;

    (b) The board of directors of the new stock insurer has approved the acquisition or extraordinary circumstances not contemplated in the plan of conversion have arisen which would warrant approval of the acquisition; and

    (c) The acquisition is consistent with the purpose of sections 174 to 202, inclusive, of this act to permit conversions on terms and conditions that are fair and equitable to the policyholders.

    3.  An application for acquisition filed pursuant to subsection 1 must describe in sufficient detail all information necessary for the approval of the application.

    4.  If any material change occurs in the facts set forth in an application for acquisition filed pursuant to subsection 1, an amendment setting forth the change, together with copies of all documents and other material relevant to the change, must be filed with the commissioner.

    5.  The commissioner may hold a public hearing on an application for acquisition filed pursuant to subsection 1. If the commissioner decides to hold a public hearing, the hearing must be held not later than 30 days after the person seeking to acquire securities files an application for acquisition with the commissioner pursuant to subsection 1. The commissioner shall give at least 20 days’ notice of the hearing to the person filing the application for acquisition. The person filing the application for acquisition shall give not less than 7 days’ notice of the hearing to the new stock insurer and to such other persons as may be designated by the commissioner.


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ê2001 Statutes of Nevada, Page 2239 (Chapter 446, AB 618)ê

 

stock insurer and to such other persons as may be designated by the commissioner. In connection with the hearing, the person filing the application for acquisition, the new stock insurer, any other person to whom notice of the hearing was given, and any other person whose interest may be affected may conduct discovery proceedings in the same manner as is allowed in the district court. All discovery proceedings must be concluded not later than 3 days before the commencement of the hearing. At the hearing the person filing the application for acquisition, the new stock insurer, any other person to whom notice of the hearing was given, and any other person whose interest may be affected may present evidence, examine and cross-examine witnesses, and offer oral and written arguments. If any acquisition referred to in the application for acquisition is proposed by means of a registration statement under the Securities Act of 1933, 15 U.S.C. §§ 77a et seq., in circumstances requiring the disclosure of similar information under the Securities Exchange Act of 1934, 15 U.S.C. §§ 78a et seq., or under a state law requiring similar registration or disclosure, the person required to file the statement may utilize such documents in furnishing the information required by the application for acquisition. The person filing the application shall serve the new stock insurer and any institution that owns a majority of the voting securities of the new stock insurer with a copy of the application for acquisition and any amendments thereto on the day the documents are filed with the commissioner.

    6.  The new stock insurer and any institution that owns a majority of the voting securities of the new stock insurer must be permitted to become parties to the hearing upon request.

    7.  The commissioner shall make a determination not later than 30 days after the conclusion of the hearing or, if no hearing is held, not later than 30 days after the date on which the application for acquisition is filed with the commissioner pursuant to subsection 1. Approval or disapproval of an application for acquisition must be by written order. Any person who is aggrieved by the order may petition for judicial review in the manner provided by chapter 233B of NRS.

    8.  The commissioner may retain, at the expense of the person filing an application for acquisition pursuant to subsection 1, any attorneys, actuaries, accountants and other experts who are not employees of the division as may be reasonably necessary to assist the commissioner in reviewing the application.

    Sec. 197.  1.  No security which is the subject of any agreement or arrangement regarding acquisition, or which is acquired or to be acquired, in contravention of section 196 of this act or of any regulation or order of the commissioner may be voted at any shareholders’ meeting or may be counted for quorum purposes, and any action of the shareholders requiring the affirmative vote of a percentage of shares may be taken as though such securities were not issued and outstanding, but no action taken at any such meeting may be invalidated by the voting of such securities unless:

    (a) The action would materially affect control of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer; or

    (b) A court of competent jurisdiction has so ordered.


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ê2001 Statutes of Nevada, Page 2240 (Chapter 446, AB 618)ê

 

    2.  If a new stock insurer or the commissioner has reason to believe that any security of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer has been or is about to be acquired in contravention of sections 174 to 202, inclusive, of this act or of any regulation or order of the commissioner, the new stock insurer or the commissioner may apply to the First Judicial District Court in and for Carson City for an order to enjoin any offer or acquisition made in contravention of section 196 of this act or any regulation or order of the commissioner to enjoin the voting of any security so acquired, to void any vote of such a security already cast at any shareholders’ meeting, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the new stock insurer, or the public, may require.

    Sec. 198.  In any case where a person has acquired or is proposing to acquire any voting securities in violation of sections 174 to 202, inclusive, of this act or any regulation or order of the commissioner, the First Judicial District Court in and for Carson City may, upon the application of the commissioner or the new stock insurer, and on such notice as the court determines appropriate, seize or sequester any voting securities of the new stock insurer or an institution that owns a majority of the voting securities of the new stock insurer owned directly or indirectly by such a person and issue any order with respect thereto as the court determines appropriate to effectuate the provisions of sections 174 to 202, inclusive, of this act. Notwithstanding any other provision of law, for the purposes of sections 174 to 202, inclusive, of this act, the situs of the ownership of such securities shall be deemed to be in this state.

    Sec. 199.  A person who offers to acquire or acquires a security in violation of subsection 1 of section 196 of this act may be required by the commissioner, after notice and hearing, to pay an administrative penalty of $100 for each day that the person remains in violation, except that the aggregate penalty pursuant to this section may not exceed $10,000.

    Sec. 200.  Any director or officer of a person, or an agent of the person, who knowingly violates or assents to or permits any officer or agent of the person to violate the requirements of section 196 of this act may be required by the commissioner, after notice and hearing, to pay, in his individual capacity, an administrative penalty of not more than $5,000 per violation. In determining the amount of the penalty, the commissioner shall take into account the appropriateness of the penalty with respect to the gravity of the violation, the history of previous violations, and such other matters as the commissioner determines are required in the interest of justice.

    Sec. 201.  1.  If the commissioner has reason to believe that any person or any director, officer, employee or agent of the person is engaged in any conduct in violation of section 196 of this act, the commissioner may order the person to cease and desist immediately from engaging in any further such conduct. The order is permanent unless the person, not later than 20 days after receipt of the order, files a written request for a hearing with the commissioner.

    2.  If, after a hearing pursuant to subsection 1, the commissioner determines that such action is in the best interest of the policyholders, the creditors or the public, the commissioner may also order the person to void any contract entered into in violation of section 196 of this act.


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ê2001 Statutes of Nevada, Page 2241 (Chapter 446, AB 618)ê

 

    3.  An order of the commissioner pursuant to this section is a final decision in a contested case for the purpose of judicial review pursuant to chapter 233B of NRS.

    Sec. 202.  The commissioner may adopt such regulations and issue such orders as he determines are necessary to carry out the provisions of sections 174 to 202, inclusive, of this act.

    Sec. 203.  As used in sections 203 to 226, inclusive, of this act, unless the context otherwise requires, the words and terms defined in sections 204 to 207, inclusive, of this act have the meanings ascribed to them in those sections.

    Sec. 204.  “Intermediate stock holding company” means a holding company of which at least a majority of the voting securities are owned by a mutual insurance holding company and which directly owns all the voting securities of a reorganized stock insurer.

    Sec. 205.  “Mutual insurance holding company” means a holding company based on a mutual plan which at all times owns a majority of the voting securities of a single intermediate stock holding company or, if no such intermediate stock holding company exists, which owns a majority of the voting securities of a reorganized stock insurer.

    Sec. 206.  “Reorganized stock insurer” means a stock insurer subsidiary that results from a reorganization of a domestic mutual insurer pursuant to sections 203 to 226, inclusive, of this act.

    Sec. 207.  “Voting securities” means securities of any class or any ownership interest having voting power for the election of directors, trustees or management, other than securities having voting power only because of the occurrence of a contingency.

    Sec. 208.  A domestic mutual insurer may, by complying with sections 203 to 226, inclusive, of this act and obtaining the approval of the commissioner, reorganize by:

    1.  Merging the membership interests of its policyholders into:

    (a) A mutual insurance holding company formed for the purpose of the reorganization; or

    (b) An existing mutual insurance holding company; and

    2.  Continuing the corporate existence of the mutual insurer as a stock insurer subsidiary of the mutual insurance holding company.

    Sec. 209.  A domestic mutual insurer shall file with the commissioner for review and approval a proposed plan of reorganization that has been approved by a vote of not less than two-thirds of the members of the board of directors of the domestic mutual insurer. The proposed plan of reorganization must be accompanied by a nonrefundable fee of $2,450. The plan of reorganization must include:

    1.  An analysis of the benefits and risks of the proposed reorganization, including, without limitation, the rationale and comparative benefits and risks of converting to a domestic stock insurer pursuant to sections 174 to 202, inclusive of this act;

    2.  A statement of how the plan is fair and equitable to the policyholders;

    3.  Information sufficient to demonstrate that the financial condition of the mutual insurer will not be diminished upon reorganization;

    4.  Provisions to ensure immediate membership in the mutual insurance holding company for all existing policyholders of the mutual insurer;


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ê2001 Statutes of Nevada, Page 2242 (Chapter 446, AB 618)ê

 

    5.  Provisions for membership interests for future policyholders of the reorganized stock insurer;

    6.  Provisions to ensure that, in the event of proceedings for rehabilitation or liquidation involving a stock insurer subsidiary of the mutual insurance holding company, the assets of the mutual insurance holding company will be available to satisfy the obligations of the stock insurer subsidiary to policyholders;

    7.  Provisions for the periodic distribution of the accumulated earnings of the mutual insurance holding company;

    8.  Certified copies of the proposed articles of incorporation and bylaws of the mutual insurance holding company, intermediate stock holding company and reorganized stock insurer, or proposed amendments thereto as necessary to carry out the reorganization;

    9.  A certification that the plan of reorganization has been duly adopted by a vote of not less than two-thirds of the members of the board of directors of the mutual insurer;

    10.  A certification adopted by not less than two-thirds of the members of the board of directors of the mutual insurer that the plan of reorganization is fair and equitable to the policyholders;

    11.  The names, addresses and occupations of all persons who are or have been selected to become directors or officers of the mutual insurance holding company;

    12.  A description of the nature and content of the annual report and financial statement to be sent by the mutual insurance holding company to each policyholder;

    13.  The number of members of the board of directors of the mutual insurance holding company who are required to be policyholders;

    14.  A description of any plans for the initial sale of stock of the intermediate stock holding company or reorganized stock insurer;

    15.  A form of the proposed notice to be mailed by the mutual insurer to its policyholders as required by section 212 of this act; and

    16.  Such additional information as the commissioner may by regulation prescribe as necessary or appropriate for the protection of policyholders and security holders of the domestic mutual insurer or for the protection of the public interest.

    Sec. 210.  Unless the commissioner, for good cause, extends the time, the commissioner shall conduct a public hearing regarding a proposed plan of reorganization not later than 120 days after the date on which the completed proposed plan of reorganization is filed pursuant to section 209 of this act. Any interested person may appear or otherwise be heard at the public hearing. The commissioner may continue the public hearing for a reasonable period, not to exceed 60 days. The mutual insurer shall give such reasonable notice of the public hearing as the commissioner requires.

    Sec. 211.  1.  The commissioner shall issue an order approving or disapproving a proposed plan of reorganization not later than 30 days after the public hearing required by section 210 of this act.

    2.  The commissioner shall not approve a proposed plan of reorganization unless he finds that the:

    (a) Plan of reorganization is fair and equitable to the policyholders;

    (b) Plan of reorganization does not deprive the policyholders of their property rights or due process of law;


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ê2001 Statutes of Nevada, Page 2243 (Chapter 446, AB 618)ê

 

    (c) Reorganized stock insurer meets the minimum requirements for a certificate of authority to transact the business of insurance in this state; and

    (d) Continued operation of the reorganized stock insurer is not hazardous to future policyholders and the public.

    3.  If the commissioner approves a plan of reorganization, the commissioner shall publish notification of the issuance of the order in a newspaper of general circulation in Carson City and in the county of domicile of the mutual insurer if different from Carson City.

    4.  If the commissioner approves a plan of reorganization, the approval expires if the reorganization is not completed within 180 days after the date of approval, unless the period is extended by the commissioner for good cause.

    5.  If the commissioner disapproves a plan of reorganization, the commissioner shall issue an order setting forth specific findings for the disapproval.

    Sec. 212.  1.  Within 45 days after the date of the commissioner’s approval of a plan of reorganization pursuant to section 211 of this act, unless extended by the commissioner for good cause, the mutual insurer shall hold a meeting of its policyholders at a reasonable time and place to vote upon the plan of reorganization. The mutual insurer shall give notice not less than 30 days before the meeting, by first-class mail to the last known address of each policyholder, that the plan of reorganization will be voted upon at a regular or special meeting of the policyholders. The notice must include a brief description of the plan of reorganization, a statement that the commissioner has approved the plan of reorganization, and a written proxy permitting the policyholder to vote for or against the plan of reorganization. For the purposes of notice and voting, the policyholder of a policy of group insurance is the entity to which the group policy is issued and not any person covered under the group policy. A plan of reorganization is approved only if not less than two-thirds of the policyholders voting in person or by proxy at the meeting vote in favor of the plan of reorganization. Each policyholder is entitled to only one vote regardless of the number of policies owned by the policyholder. The commissioner shall supervise and direct the conducting of the vote on the plan of reorganization as necessary to ensure that the vote is fair and consistent with the requirements of this section.

    2.  If a mutual insurer complies substantially and in good faith with the notice requirements of this section, the mutual insurer’s failure to give any policyholder the required notice does not impair the validity of any action taken pursuant to this section.

    3.  If the meeting of policyholders to vote upon the plan of reorganization is held coincident with the mutual insurer’s annual meeting of policyholders, only one combined notice of meeting is required.

    4.  The form of any proxy must be filed with and approved by the commissioner.

    5.  For the purposes of notice and voting, a person is not a policyholder unless he was a policyholder of the mutual insurer on the date on which the plan of reorganization was initially approved by the board of directors of the mutual insurer.


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ê2001 Statutes of Nevada, Page 2244 (Chapter 446, AB 618)ê

 

    Sec. 213.  A mutual insurer may, by not less than a two-thirds vote of the members of its board of directors and with the approval of the commissioner, abandon a plan of reorganization at any time before the issuance of the certificate of authority by the commissioner pursuant to section 214 of this act. Upon abandonment, all rights and obligations arising out of the plan of reorganization terminate and the mutual insurer shall continue to conduct its business as a domestic mutual insurer as though no plan of reorganization had ever been adopted.

    Sec. 214.  1.  The commissioner shall issue a certificate of authority to a reorganized stock insurer when the mutual insurer files with the commissioner a:

    (a) Certificate stating that all the conditions set forth in the plan of reorganization have been satisfied, so long as the board of directors of the mutual insurer has not abandoned the plan of reorganization pursuant to section 213 this act.

    (b) Certificate from the mutual insurer setting forth the vote and certifying that the plan of reorganization was approved by not less than two-thirds of the policyholders voting in person or by proxy on the plan of reorganization.

    2.  The reorganization is effective upon the issuance of a certificate of authority by the commissioner.

    3.  Upon issuance of the certificate of authority, the articles of incorporation of the mutual insurer shall be deemed to be amended in compliance with NRS 692B.030.

    Sec. 215.  Any person aggrieved by a final order of the commissioner issued pursuant to the provisions of sections 203 to 226, inclusive, of this act may petition for judicial review in the manner provided by chapter 233B of NRS.

    Sec. 216.  In determining whether a plan of reorganization meets the requirements of the provisions of sections 203 to 226, inclusive, of this act, or with regard to any other matters relating to the development of a plan of reorganization, the commissioner may engage the services of experts. All reasonable costs related to the review of a plan of reorganization or such other matters, including those costs attributable to the use of experts, must be paid by the mutual insurer filing the application or initiating discussions with the commissioner about such matters.

    Sec. 217.  1.  Except as otherwise provided in subsection 2, all information and documents obtained by or disclosed to the commissioner or any other person in the course of preparing, filing and processing an application to reorganize pursuant to section 209 of this act, other than information and documents distributed to policyholders in connection with the meeting of policyholders pursuant to section 212 of this act or filed or submitted as evidence in connection with the public hearing pursuant to section 210 of this act, are confidential and not subject to subpoena, and must not be made public by the commissioner, the National Association of Insurance Commissioners or any other person, except to insurance departments of other states, without the prior written consent of the insurer to which such information and documents pertain.

    2.  If the commissioner, after giving the insurer and its affiliates who would be affected notice and opportunity to be heard, determines that the interests of policyholders, shareholders or the public will be best served by the publication of such information and documents, the commissioner may publish all or any part thereof in such a manner as he determines appropriate.


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ê2001 Statutes of Nevada, Page 2245 (Chapter 446, AB 618)ê

 

publish all or any part thereof in such a manner as he determines appropriate.

    Sec. 218.  The corporate existence of a mutual insurer reorganizing pursuant to sections 203 to 226, inclusive, of this act does not terminate, and the reorganized stock insurer shall be deemed to be a continuation of the mutual insurer and to have been organized on the date on which the mutual insurer was originally organized.

    Sec. 219.  1.  All the initial shares of the capital stock of a reorganized stock insurer must be issued to the mutual insurance holding company or to a single intermediate stock holding company.

    2.  Policyholders of a domestic mutual insurer that has been reorganized are members of the mutual insurance holding company and their voting rights must be determined in accordance with the articles of incorporation and bylaws of the mutual insurance holding company. The mutual insurance holding company shall provide its members with the same membership rights as were provided to policyholders of the mutual insurer immediately before reorganization. The reorganization must not reduce, limit or otherwise affect the number or identity of the policyholders who may become members of the mutual insurance holding company or secure for managerial personnel any unfair advantage through or connected with the reorganization.

    3.  A mutual insurance holding company or an intermediate stock holding company formed pursuant to sections 203 to 226, inclusive, of this act:

    (a) Must not be authorized to transact the business of insurance;

    (b) Is subject to the jurisdiction of the commissioner, who shall ensure that policyholder interests are protected; and

    (c) Shall be deemed to be an insurer for the purposes of chapter 696B of NRS.

    4.  An intermediate stock holding company formed pursuant to sections 203 to 226, inclusive, of this act shall be deemed to be a mutual insurance holding company subject to the provisions of sections 174 to 202, inclusive, of this act.

    5.  A mutual insurance holding company formed pursuant to sections 203 to 226, inclusive, of this act:

    (a) Shall not issue stock.

    (b) Shall invest in insurers not less than 50 percent of its net worth as determined by generally accepted accounting practices.

    6.  The aggregate pledges and encumbrances of the assets of a mutual insurance holding company must not affect more than 49 percent of the mutual insurance holding company’s stock in an intermediate stock holding company or a reorganized stock insurer.

    7.  If any proceeding under chapter 696B of NRS is brought against a reorganized stock insurer, the mutual insurance holding company and intermediate stock holding company must be named parties to the proceeding. All the assets of the mutual insurance holding company and the intermediate stock holding company shall be deemed assets of the estate of the reorganized stock insurer to the extent necessary to satisfy claims against the reorganized stock insurer.

    8.  No distribution to members of a mutual insurance holding company may occur without the prior written approval of the commissioner. The commissioner may give such approval only if he is satisfied that the distribution is fair and equitable to policyholders as members of the mutual insurance holding company.


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ê2001 Statutes of Nevada, Page 2246 (Chapter 446, AB 618)ê

 

distribution is fair and equitable to policyholders as members of the mutual insurance holding company.

    9.  No solicitation for the sale of the stock of an intermediate stock holding company or a reorganized stock insurer may be made without the prior written approval of the commissioner.

    10.  A mutual insurance holding company or an intermediate stock holding company may not voluntarily dissolve without the approval of the commissioner.

    Sec. 220.  Nothing contained in sections 203 to 226, inclusive, of this act prohibits a mutual insurance holding company from converting to a domestic stock insurance company pursuant to sections 174 to 202, inclusive, of this act.

    Sec. 221.  A membership interest in a mutual insurance holding company does not constitute a security under the laws of this state.

    Sec. 222.  1.  No director, officer, employee or agent of the mutual insurer, or any other person, may receive any fee, commission or other valuable consideration, other than his usual regular salary and compensation, for aiding, promoting or assisting in a plan of reorganization except as set forth in the plan of reorganization approved by the commissioner.

    2.  Subsection 1 does not prohibit a management incentive compensation program that is contained in the plan of reorganization and approved by the commissioner to be adopted upon reorganization to the reorganized stock insurer or prohibit such a program to be adopted later by the reorganized stock insurer.

    3.  Subsection 1 does not prohibit the payment of reasonable fees and compensation to attorneys, accountants, actuaries and investment bankers for services performed in the independent practice of their professions if the person is also a member of the board of directors of the mutual insurer.

    Sec. 223.  1.  A mutual insurance holding company shall file with the commissioner, by March 1 of each year, an annual statement consisting of an income statement, balance sheet and cash flows prepared in accordance with generally accepted accounting practices and a confidential statement disclosing any intention to pledge, borrow against, alienate, hypothecate or in any way encumber the assets of the mutual insurance holding company.

    2.  A mutual insurance holding company shall, on or before June 1 of each year, file with the commissioner in a form approved by the commissioner a financial statement as of December 31 of the preceding calendar year that is certified by a certified public accountant.

    Sec. 224.  The commissioner may order the production of any records, books or other information and papers in the possession of a mutual insurance holding company or its affiliates as is reasonably necessary to ascertain the financial condition of the reorganized stock insurer or to determine compliance with this Title.

    Sec. 225.  Whenever it appears to the commissioner that any person or any director, officer, employee or agent of the person has committed or is about to commit a violation of any provision of sections 203 to 226, inclusive, of this act or of any regulation or order of the commissioner relating thereto, the commissioner may apply to the First Judicial District Court in and for Carson City for an order enjoining the person, director, officer, employee or agent from violating or continuing to violate any provision of sections 203 to 226, inclusive, of this act or any such regulation or order, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the insurer, or the public, may require.


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ê2001 Statutes of Nevada, Page 2247 (Chapter 446, AB 618)ê

 

regulation or order, and for such other equitable relief as the nature of the case and the interest of the policyholders, creditors and shareholders of the insurer, or the public, may require.

    Sec. 226.  The commissioner may adopt such regulations and issue such orders as he determines are necessary to carry out the provisions of sections 203 to 226, inclusive, of this act.

    Sec. 227.  NRS 693A.290 is hereby amended to read as follows:

    693A.290  1.  A stock insurer other than a title insurer may become a mutual insurer under such plan and procedure as may be approved by the commissioner after a hearing thereon.

    2.  The commissioner shall not approve any such plan, procedure or mutualization unless:

    (a) It is equitable to stockholders and policyholders;

    (b) It is subject to approval by the holders of not less than two-thirds of the insurer’s outstanding capital stock having voting rights, and by not less than two-thirds of the insurer’s policyholders who vote on [such] the plan in person, by proxy or by mail pursuant to such notice and procedure as may be approved by the [commissioners;] commissioner;

    (c) If a life insurer, the right to vote thereon is limited to holders of policies other than term or group policies, [and] whose policies have been in force for more than 1 year;

    (d) Mutualization will result in retirement of shares of the insurer’s capital stock at a price not in excess of the fair market value thereof as determined [by competent disinterested appraisers;] under a fair and reasonable formula approved by the commissioner or, if so ordered, by an examination of the insurer and all of its controlled affiliates or by an appraisal committee, consisting of at least three qualified persons, to be appointed by the commissioner;

    (e) The plan provides for the purchase of the shares of any nonconsenting stockholder in the same manner and subject to the same applicable conditions as provided by the general corporation law of the state as to rights of nonconsenting stockholders, with respect to consolidation or merger of private corporations;

    (f) The plan provides for definite conditions to be fulfilled by a designated early date upon which such mutualization will [be deemed] become effective; and

    (g) The mutualization leaves the insurer with a surplus [funds] reasonably adequate for the security of its policyholders and to enable it to continue successfully in business in the states in which it is then authorized to transact insurance, and for the kinds of insurance included in its certificates of authority in such states.

    3.  No director, officer, agent or employee of the insurer, or any other person, [shall] may receive any fee, commission or other valuable consideration whatsoever, other than his customary salary or other regular compensation, for in any manner aiding, promoting or assisting in the mutualization, except as set forth in the plan of mutualization as approved by the commissioner.

    4.  This section does not apply to mutualization under an order of court pursuant to rehabilitation or reorganization of an insurer under chapter 696B of NRS.


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ê2001 Statutes of Nevada, Page 2248 (Chapter 446, AB 618)ê

 

    Sec. 228.  NRS 693A.320 is hereby amended to read as follows:

    693A.320  1.  Any person proposing to acquire the controlling capital stock of any domestic stock insurer and thereby to change the control of the insurer, other than through merger or consolidation or affiliation as provided for in NRS 693A.310 and 693A.330, must first apply to the commissioner in writing for approval of [such] the proposed change of control. The application must state the names and addresses of the proposed new owners of the controlling stock and contain such additional information as the commissioner may reasonably require.

    2.  The commissioner shall not approve the proposed change of control if he finds that:

    (a) The proposed new owners are not qualified by character, experience and financial responsibility to control and operate the insurer, or cause the insurer to be operated, in a lawful and proper manner;

    (b) As a result of the proposed change of control the insurer may not be qualified for a certificate of authority under the provisions of NRS 680A.090;

    (c) The interests of the insurer or other stockholders of the insurer or policyholder would be materially harmed through the proposed change of control; or

    (d) The proposed change of control would tend materially to lessen competition, or to create any monopoly, in a business of insurance in this state or elsewhere.

    3.  If the commissioner does not by affirmative action approve or disapprove the proposed change of control within [30] 60 days after the date the application was so filed with him, the proposed change may be made without his approval, but if the commissioner gives notice to the parties of a hearing to be held by him with respect to the proposed change of control, and the hearing is held within the 30 days or on a date mutually acceptable to the commissioner and the parties, the commissioner has 10 days after the conclusion of the hearing within which to so approve or disapprove the proposed change. If not so approved or disapproved, the change may thereafter be made without the commissioner’s approval.

    4.  If the commissioner disapproves the proposed change he shall give written notice thereof to the parties, setting forth in detail the reasons for disapproval.

    5.  The commissioner shall suspend or revoke the certificate of authority of any insurer the control of which has been changed in violation of this section.

    6.  The commissioner may retain at the acquiring party’s expense attorneys, actuaries, accountants and other experts not otherwise a part of his staff as may be necessary only for the review of the proposed acquisition of control. Such a review may be conducted only if the parties fail to provide sufficient information to the commissioner. Expenses chargeable to the acquiring party pursuant to this subsection must not exceed 1 percent of the acquired insurer’s net revenue during the year immediately preceding the year in which the application for change of control is filed with the commissioner pursuant to subsection 1.

    Sec. 229.  NRS 695A.580 is hereby amended to read as follows:

    695A.580  1.  Any person who makes a false or fraudulent statement in or relating to an application for membership or for the purpose of obtaining money from or a benefit in any society is guilty of a gross misdemeanor.


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ê2001 Statutes of Nevada, Page 2249 (Chapter 446, AB 618)ê

 

    2.  Any person who solicits membership for, or in any manner assists in procuring membership in, any society not licensed to do business in this state is subject to an administrative fine, imposed by the commissioner, of not less than $25 nor more than $500 for each violation. In addition if the person is an insurance agent of the society, the commissioner may suspend, revoke, limit or refuse to continue his license in the manner provided in [NRS 683A.450.] sections 93 and 94 of this act.

    3.  Any person convicted of a willful violation of, or neglect or refusal to comply with, any provision of this chapter for which a penalty is not otherwise prescribed shall be punished by a fine of not more than $1,000 for each violation, and not more than $10,000 for all related violations.

    Sec. 230.  NRS 695B.191 is hereby amended to read as follows:

    695B.191  1.  [Any] A policy of health insurance, issued by a medical service corporation, which provides coverage for the surgical procedure known as a mastectomy must also provide commensurate coverage for [at least two prosthetic devices and for reconstructive surgery incident to the mastectomy. Except as otherwise provided in subsection 2, this coverage must be subject to the same terms and conditions that apply to the coverage for the mastectomy.] :

    (a) Reconstruction of the breast on which the mastectomy has been performed;

    (b) Surgery and reconstruction of the other breast to produce a symmetrical structure; and

    (c) Prostheses and physical complications for all stages of mastectomy, including lymphedemas.

    2.  The provision of services must be determined by the attending physician and the patient.

    3.  The plan or issuer may require deductibles and coinsurance payments if they are consistent with those established for other benefits.

    4.  Written notice of the availability of the coverage must be given upon enrollment and annually thereafter. The notice must be sent to all participants:

    (a) In the next mailing made by the plan or issuer to the participant or beneficiary; or

    (b) As part of any annual information packet sent to the participant or beneficiary,

whichever is earlier.

    5.  A plan or issuer may not:

    (a) Deny eligibility, or continued eligibility, to enroll or renew coverage, in order to avoid the requirements of subsections 1 to 4, inclusive; or

    (b) Penalize, or limit reimbursement to, a provider of care, or provide incentives to a provider of care, in order to induce the provider not to provide the care listed in subsections 1 to 4, inclusive.

    6.  A plan or issuer may negotiate rates of reimbursement with providers of care.

    7.  If reconstructive surgery is begun within 3 years after a mastectomy, the amount of the benefits for that surgery must equal those amounts provided for in the policy at the time of the mastectomy. If the surgery is begun more than 3 years after the mastectomy, the benefits provided are subject to all of the terms, conditions and exclusions contained in the policy at the time of the reconstructive surgery.


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ê2001 Statutes of Nevada, Page 2250 (Chapter 446, AB 618)ê

 

    [3.] 8.  A policy subject to the provisions of this chapter which is delivered, issued for delivery or renewed on or after October 1, [1989,] 2001, has the legal effect of including the coverage required by this section, and any provision of the policy or the renewal which is in conflict with this section is void.

    [4.] 9.  For the purposes of this section, “reconstructive surgery” means a surgical procedure performed following a mastectomy on one breast or both breasts to reestablish symmetry between the two breasts. The term includes [, but is not limited to,] augmentation mammoplasty, reduction mammoplasty and mastopexy.

    Sec. 231.  NRS 695C.171 is hereby amended to read as follows:

    695C.171  1.  [Any] A health maintenance plan which provides coverage for the surgical procedure known as a mastectomy must also provide commensurate coverage for [at least two prosthetic devices and for reconstructive surgery incident to the mastectomy. Except as otherwise provided in subsection 2, this coverage must be subject to the same terms and conditions that apply to the coverage for the mastectomy.

    2.] :

    (a) Reconstruction of the breast on which the mastectomy has been performed;

    (b) Surgery and reconstruction of the other breast to produce a symmetrical structure; and

    (c) Prostheses and physical complications for all stages of mastectomy, including lymphedemas.

    2.  The provision of services must be determined by the attending physician and the patient.

    3.  The plan or issuer may require deductibles and coinsurance payments if they are consistent with those established for other benefits.

    4.  Written notice of the availability of the coverage must be given upon enrollment and annually thereafter. The notice must be sent to all participants:

    (a) In the next mailing made by the plan or issuer to the participant or beneficiary; or

    (b) As part of any annual information packet sent to the participant or beneficiary,

whichever is earlier.

    5.  A plan or issuer may not:

    (a) Deny eligibility, or continued eligibility, to enroll or renew coverage, in order to avoid the requirements of subsections 1 to 4, inclusive; or

    (b) Penalize, or limit reimbursement to, a provider of care, or provide incentives to a provider of care, in order to induce the provider not to provide the care listed in subsections 1 to 4, inclusive.

    6.  A plan or issuer may negotiate rates of reimbursement with providers of care.

    7.  If reconstructive surgery is begun within 3 years after a mastectomy, the amount of the benefits for that surgery must equal those amounts provided for in the policy at the time of the mastectomy. If the surgery is begun more than 3 years after the mastectomy, the benefits provided are subject to all of the terms, conditions and exclusions contained in the policy at the time of the reconstructive surgery.


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ê2001 Statutes of Nevada, Page 2251 (Chapter 446, AB 618)ê

 

    [3.] 8.  A policy subject to the provisions of this chapter which is delivered, issued for delivery or renewed on or after October 1, [1989,] 2001, has the legal effect of including the coverage required by this section, and any provision of the policy or the renewal which is in conflict with this section is void.

    [4.] 9.  For the purposes of this section, “reconstructive surgery” means a surgical procedure performed following a mastectomy on one breast or both breasts to reestablish symmetry between the two breasts. The term includes, but is not limited to, augmentation mammoplasty, reduction mammoplasty and mastopexy.

    Sec. 232.  NRS 696A.310 is hereby amended to read as follows:

    696A.310  The commissioner may suspend, revoke or refuse to renew any club agent’s license issued under this chapter for any cause specified in any other provision of this chapter, or for any of the same applicable grounds and in the manner provided for [agents of insurers in NRS 683A.450, 683A.460 and 683A.470.] a producer of insurance in sections 93 and 94 of this act.

    Sec. 233.  Chapter 696B of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  Except as otherwise provided in subsections 2 and 4, if an order for liquidation or rehabilitation of a domestic insurer has been issued, the receiver appointed under the order may recover on behalf of the insurer:

    (a) From any parent corporation, holding company, affiliate or person who otherwise controlled the insurer, the amount of any distribution, other than a distribution of shares of the same class of stock, made by the insurer on its capital stock; and

    (b) Any payment in the form of a bonus, settlement on termination, or extraordinary adjustment of salary in a lump sum made by the insurer or a subsidiary to a director, officer or employee,

made during the year preceding the petition for liquidation, conservation or rehabilitation.

    2.  A distribution is not recoverable if the parent corporation, holding company or affiliate shows that when made the distribution was lawful and reasonable and that the insurer did not know and could not reasonably have known that the distribution might adversely affect the ability of the insurer to fulfill its contractual obligations.

    3.  A parent corporation, holding company or person who otherwise controlled the insurer or affiliate at the time the distribution or payment was made is liable up to the amount of the distribution or payment which he received. A person who otherwise controlled the insurer at the time a distribution was declared is liable up to the amount that would have been received if the distribution had been made immediately. If two or more persons are liable with respect to the same distribution, they are jointly and severally liable.

    4.  The greatest amount recoverable under this section is the amount needed in excess of all other available assets of the impaired or insolvent insurer to pay its contractual obligations and reimburse any guaranty fund.

    5.  To the extent that a person liable under subsection 3 is insolvent or otherwise fails to pay a claim due from it, a parent corporation, holding company or person who otherwise controlled it at the time the distribution was made is jointly and severally liable for any resulting deficiency in the amount recovered from the person so liable.


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ê2001 Statutes of Nevada, Page 2252 (Chapter 446, AB 618)ê

 

was made is jointly and severally liable for any resulting deficiency in the amount recovered from the person so liable.

    Sec. 234.  NRS 696B.565 is hereby amended to read as follows:

    696B.565  1.  The commissioner , as receiver, all present and former deputy receivers, special deputy receivers and their employees, and the other officers, agents, employees and attorneys of the division are [not liable for any action or omission made in good faith by the commissioner, officer, agent, employee or attorney in the performance of his duties or exercise of authority pursuant to this chapter. Nothing in this section abrogates or modifies any other privilege otherwise provided by law to the commissioner or the officers, agents, employees and attorneys of the division.] immune from liability, both personally and in their official capacities, for any claim for damage to or loss of property or personal injury or other civil liability caused by or resulting from any alleged act, error or omission of the officers, agents, employees and attorneys of the division arising out of or by reason of their duties or employment. This subsection must not be construed to hold the officers, agents, employees and attorneys of the division immune from liability for any damage, loss, injury or liability caused by actual malice.

    2.  Attorneys, accountants, auditors and other professional persons or firms who are retained by the commissioner as independent contractors and their employers must not be considered employees for the purposes of this chapter.

    3.  The commissioner, all present and former deputy receivers, special deputy receivers and their employees, and the other officers, agents, employees and attorneys of the division must be indemnified for all expenses, attorney’s fees, judgments, settlements, decrees, or amounts due or paid in satisfaction of, or incurred in the defense of, such a legal action, unless it is determined upon a final adjudication on the merits of the case that the alleged acts, error or omission of the officer, agent, employee or attorney of the division did not arise out of or by reason of his duties or employment and was caused by actual malice.

    4.  The state may seek indemnification for the payment of expenses, judgments, settlements, decrees, attorney’s fees, surety bond premiums or other amounts paid or to be paid from the insurer’s assets. Any payment pursuant to this section shall be deemed an administrative expense of the insurer.

    Sec. 235.  Chapter 697 of NRS is hereby amended by adding thereto a new section to read as follows:

    A bail agent, bail enforcement agent or bail solicitor whose license lapses is exempt from retaking the examination otherwise required under NRS 697.200 if he applies and is relicensed within 6 months after the date of lapse.

    Sec. 236.  NRS 697.090 is hereby amended to read as follows:

    697.090  1.  A person in this state shall not act in the capacity of a bail agent, bail enforcement agent or bail solicitor, or perform any of the functions, duties or powers prescribed for a bail agent, bail enforcement agent or bail solicitor under the provisions of this chapter, unless that person is qualified and licensed as provided in this chapter. The commissioner may, after notice and [a hearing, impose a] opportunity to be heard, impose an administrative fine of not more than $1,000 for each act or violation of the provisions of this subsection.


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ê2001 Statutes of Nevada, Page 2253 (Chapter 446, AB 618)ê

 

    2.  A person, whether or not located in this state, shall not act as or hold himself out to be a general agent unless qualified and licensed as such under the provisions of this chapter.

    3.  For the protection of the people of this state, the commissioner shall not issue or renew, or permit to exist, any license except in compliance with this chapter. The commissioner shall not issue or renew, or permit to exist, a license for any person found to be untrustworthy or incompetent, or who has not established to the satisfaction of the commissioner that he is qualified therefor in accordance with this chapter.

    Sec. 237.  NRS 697.120 is hereby amended to read as follows:

    697.120  This chapter does not:

    1.  Prevent [any licensed general lines agent, as defined in NRS 683A.050,] a producer of insurance from writing bail bonds for any insurer authorized to write surety for which he [represents as agent, providing the agent] is an appointed agent, but he is subject to and governed by all laws [, rules] and regulations relating to bail agents when engaged in the activities thereof.

    2.  Affect the negotiation for or the execution or delivery of a bail bond which is authorized by chapter 696A of NRS.

    Sec. 238.  NRS 697.230 is hereby amended to read as follows:

    697.230  1.  Except as otherwise provided in NRS 697.177, each license issued to a general agent, bail agent, bail enforcement agent or bail solicitor under this chapter continues in force for 3 years unless it is suspended, revoked or otherwise terminated. A license may be renewed upon payment of the applicable fee for renewal to the commissioner on or before the last day of the month in which the license is renewable. The fee must be accompanied by:

    (a) Proof that the licensee has completed a 3-hour program of continuing education that is:

         (1) Offered by the authorized surety insurer from whom he received his written appointment, if any, a state or national organization of bail agents or another organization that administers training programs for general agents, bail agents, bail enforcement agents or bail solicitors; and

         (2) Approved by the commissioner;

    (b) If the licensee is a natural person, the statement required pursuant to NRS 697.181; and

    (c) A written request for renewal of the license. The request must be made and signed:

         (1) By the licensee in the case of the renewal of a license as a general agent, bail enforcement agent or bail agent.

         (2) By the bail solicitor and the bail agent who employs the solicitor in the case of the renewal of a license as a bail solicitor.

    2.  Any license that is not renewed on or before the last day specified for its renewal expires at midnight on that day. The commissioner may accept a request for renewal received by him within 30 days after the date of expiration if the request is accompanied by a fee for renewal of 150 percent of the fee otherwise required and, if the person requesting renewal is a natural person, the statement required pursuant to NRS 697.181.

    3.  A bail agent’s license continues in force while there is in effect an appointment of him as a bail agent of one or more authorized insurers. Upon termination of all the bail agent’s appointments and his failure to replace any appointment within 30 days thereafter, his license expires and he shall promptly deliver his license to the commissioner.


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ê2001 Statutes of Nevada, Page 2254 (Chapter 446, AB 618)ê

 

appointment within 30 days thereafter, his license expires and he shall promptly deliver his license to the commissioner.

    4.  The commissioner shall terminate the license of a general agent for a particular insurer upon a written request by the insurer.

    5.  This section does not apply to temporary licenses issued under [NRS 683A.300] section 92 of this act or NRS 697.177.

    Sec. 239.  NRS 697.360 is hereby amended to read as follows:

    697.360  Licensed bail agents, bail solicitors and general agents are also subject to the following provisions of this code, to the extent reasonably applicable:

    1.  Chapter 679A of NRS.

    2.  Chapter 679B of NRS.

    3.  [NRS 683A.240.

    4.  NRS 683A.300.] Section 91 of this act.

    4.  Section 92 of this act.

    5.  NRS 683A.400.

    6.  NRS 683A.410.

    7.  NRS [683A.450 to 683A.480, inclusive.] 683A.480 and sections 93, 94, 95 and 99 of this act.

    8.  NRS 686A.010 to 686A.310, inclusive.

    Sec. 240.  NRS 179A.100 is hereby amended to read as follows:

    179A.100  1.  The following records of criminal history may be disseminated by an agency of criminal justice without any restriction pursuant to this chapter:

    (a) Any which reflect records of conviction only; and

    (b) Any which pertain to an incident for which a person is currently within the system of criminal justice, including parole or probation.

    2.  Without any restriction pursuant to this chapter, a record of criminal history or the absence of such a record may be:

    (a) Disclosed among agencies which maintain a system for the mutual exchange of criminal records.

    (b) Furnished by one agency to another to administer the system of criminal justice, including the furnishing of information by a police department to a district attorney.

    (c) Reported to the central repository.

    3.  An agency of criminal justice shall disseminate to a prospective employer, upon request, records of criminal history concerning a prospective employee or volunteer which:

    (a) Reflect convictions only; or

    (b) Pertain to an incident for which the prospective employee or volunteer is currently within the system of criminal justice, including parole or probation.

    4.  The central repository shall disseminate to a prospective or current employer, upon request, information relating to sexual offenses concerning an employee, prospective employee, volunteer or prospective volunteer who gives his written consent to the release of that information.

    5.  Records of criminal history must be disseminated by an agency of criminal justice upon request, to the following persons or governmental entities:

    (a) The person who is the subject of the record of criminal history for the purposes of NRS 179A.150.


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ê2001 Statutes of Nevada, Page 2255 (Chapter 446, AB 618)ê

 

    (b) The person who is the subject of the record of criminal history or his attorney of record when the subject is a party in a judicial, administrative, licensing, disciplinary or other proceeding to which the information is relevant.

    (c) The state gaming control board.

    (d) The state board of nursing.

    (e) The private investigator’s licensing board to investigate an applicant for a license.

    (f) A public administrator to carry out his duties as prescribed in chapter 253 of NRS.

    (g) A public guardian to investigate a ward or proposed ward or persons who may have knowledge of assets belonging to a ward or proposed ward.

    (h) Any agency of criminal justice of the United States or of another state or the District of Columbia.

    (i) Any public utility subject to the jurisdiction of the public utilities commission of Nevada when the information is necessary to conduct a security investigation of an employee or prospective employee, or to protect the public health, safety or welfare.

    (j) Persons and agencies authorized by statute, ordinance, executive order, court rule, court decision or court order as construed by appropriate state or local officers or agencies.

    (k) Any person or governmental entity which has entered into a contract to provide services to an agency of criminal justice relating to the administration of criminal justice, if authorized by the contract, and if the contract also specifies that the information will be used only for stated purposes and that it will be otherwise confidential in accordance with state and federal law and regulation.

    (l) Any reporter for the electronic or printed media in his professional capacity for communication to the public.

    (m) Prospective employers if the person who is the subject of the information has given written consent to the release of that information by the agency which maintains it.

    (n) For the express purpose of research, evaluative or statistical programs pursuant to an agreement with an agency of criminal justice.

    (o) The division of child and family services of the department of human resources and any county agency that is operated pursuant to NRS 432B.325 or authorized by a court of competent jurisdiction to receive and investigate reports of abuse or neglect of children and which provides or arranges for protective services for such children.

    (p) The welfare division of the department of human resources or its designated representative.

    (q) An agency of this or any other state or the Federal Government that is conducting activities pursuant to Part D of Title IV of the Social Security Act , [(] 42 U.S.C. §§ 651 et seq. [).]

    (r) The state disaster identification team of the division of emergency management of the department of motor vehicles and public safety.

    (s) The commissioner of insurance.

    6.  Agencies of criminal justice in this state which receive information from sources outside this state concerning transactions involving criminal justice which occur outside Nevada shall treat the information as confidentially as is required by the provisions of this chapter.


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ê2001 Statutes of Nevada, Page 2256 (Chapter 446, AB 618)ê

 

    Sec. 241.  NRS 628A.010 is hereby amended to read as follows:

    628A.010  As used in this chapter, unless the context otherwise requires:

    1.  “Client” means a person who receives advice from a financial planner.

    2.  “Compensation” means a fee for services provided by a financial planner to a client or a commission or other remuneration derived by a financial planner from a person other than the client as the result of the purchase of a good or service by the client.

    3.  “Financial planner” means a person who for compensation advises others upon the investment of money or upon provision for income to be needed in the future, or who holds himself out as qualified to perform either of these functions, but does not include:

    (a) An attorney and counselor at law admitted by the supreme court of this state;

    (b) A certified public accountant or a public accountant licensed pursuant to NRS 628.190 to 628.310, inclusive, or 628.350;

    (c) A broker-dealer or sales representative licensed pursuant to NRS 90.310 or exempt under NRS 90.320;

    (d) An investment adviser licensed pursuant to NRS 90.330 or exempt under NRS 90.340; or

    (e) [An insurance agent or broker] A producer of insurance licensed pursuant to [NRS 683A.090 to 683A.350,] sections 75 to 99, inclusive, of this act or an insurance consultant licensed pursuant to NRS 683C.010 to 683C.100, inclusive,

whose advice upon investment or provision of future income is incidental to the practice of his profession or business.

    Sec. 242.  Section 23 of chapter 620, Statutes of Nevada 1999, at page 3382, is hereby amended to read as follows:

    Sec. 23.  1.  This section and sections 1 to 18, inclusive, 20 and 22 of this act become effective upon passage and approval . [and expire by limitation on July 1, 2001.]

    2.  Sections 20.2, 20.4 and 21 of this act become effective at 12:01 a.m. on July 1, 1999 . [, and expire by limitation on July 1, 2001.]

    Sec. 243.  NRS 683A.030, 683A.040, 683A.050, 683A.070, 683A.080, 683A.100, 683A.120, 683A.130, 683A.170, 683A.180, 683A.190, 683A.200, 683A.220, 683A.230, 683A.240, 683A.260, 683A.270, 683A.280, 683A.290, 683A.300, 683A.320, 683A.330, 683A.340, 683A.360, 683A.380, 683A.420, 683A.430, 683A.440, 683A.450, 683A.460, 683A.470, 689B.160, 689B.220, 689B.230, 689B.240 and 693A.360 are hereby repealed.

    Sec. 244.  The amendatory provisions of this act do not apply to offenses committed before October 1, 2001.

    Sec. 245.  1.  This section and section 242 of this act become effective upon passage and approval.

    2.  Sections 1 to 241, inclusive, 243 and 244 of this act become effective on October 1, 2001.

    3.  Section 59 of this act expires by limitation on October 1, 2003.

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ê2001 Statutes of Nevada, Page 2257ê

 

CHAPTER 447, AB 630

Assembly Bill No. 630–Committee on Natural Resources, Agriculture, and Mining

 

CHAPTER 447

 

AN ACT relating to cancer; revising the provisions governing certain records of a health care facility relating to cancer; making a fine mandatory for a violation of such provisions; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 457.250 is hereby amended to read as follows:

    457.250  1.  The chief administrative officer of each health care facility in this state shall make available to the state health officer or his representative the records of the health care facility for every case of malignant neoplasms which are specified by the state board of health as subject to reporting.

    2.  The health division shall abstract from the records of the health care facility or shall require the health care facility to abstract from their own records such information as is required by the state board of health. The health division shall compile the information timely and not later than 6 months after it abstracts the information or receives the abstracted information from the health care facility.

    3.  The board shall by regulation adopt a schedule of fees which must be assessed to the health care facility for each case from which information is abstracted by the health division or by the health care facility pursuant to subsection 2. The fee assessed to a facility which abstracts information from its own records must not exceed one-third of the amount assessed to facilities for which the health division abstracts.

    4.  Any person who violates this section is guilty of a misdemeanor [.] and shall be punished by a fine of $1,000, and may be further punished by imprisonment in the county jail for not more than 6 months.

    Sec. 2.  The amendatory provisions of this act do not apply to offenses committed before July 1, 2001.

    Sec. 3.  This act becomes effective on July 1, 2001.

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ê2001 Statutes of Nevada, Page 2258ê

 

CHAPTER 448, SB 63

Senate Bill No. 63–Committee on Government Affairs

 

CHAPTER 448

 

AN ACT relating to public works projects; authorizing public bodies and local governments to award contracts for certain public works projects to specialty contractors; specifying that certain requirements for receiving a certificate for preference in bidding must be satisfied while licensed as a general contractor or specialty contractor; requiring the state contractors’ board to issue a certificate of eligibility to receive a preference in bidding to a specialty contractor under certain circumstances; allowing general contractors and specialty contractors to receive a preference for bidding on public works by purchasing a contractor that possesses such a preference; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 338 of NRS is hereby amended by adding thereto the provisions set forth as sections 2, 3 and 4 of this act.

    Sec. 2.  1.  A public body may award a contract for the construction, alteration or repair of a public work pursuant to NRS 338.1375 to 338.1389, inclusive, to a specialty contractor if:

    (a) The majority of the work to be performed on the project to which the contract pertains consists of specialty contracting for which the specialty contractor is licensed; and

    (b) The project to which the contract pertains is not part of a larger public work.

    2.  If a public body awards a contract to a specialty contractor pursuant to NRS 338.1375 to 338.1389, inclusive, all work to be performed on the project to which the contract pertains that is outside the scope of the license of the specialty contractor must be performed by a subcontractor who is licensed to perform such work.

    Sec. 3.  (Deleted by amendment.)

    Sec. 4.  1.  A local government may award a contract for the construction, alteration or repair of a public work to a specialty contractor pursuant to NRS 338.147 if:

    (a) The majority of the work to be performed on the project to which the contract pertains consists of specialty contracting for which the specialty contractor is licensed; and

    (b) The project to which the contract pertains is not part of a larger public work.

    2.  If a local government awards a contract to a specialty contractor pursuant to NRS 338.147, all work to be performed on the project to which the contract pertains that is outside the scope of the license of the specialty contractor must be performed by a subcontractor who is licensed to perform such work.

    Sec. 5.  NRS 338.010 is hereby amended to read as follows:

    338.010  As used in this chapter:

    1.  “Day labor” means all cases where public bodies, their officers, agents or employees, hire, supervise and pay the wages thereof directly to a workman or workmen employed by them on public works by the day and not under a contract in writing.


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ê2001 Statutes of Nevada, Page 2259 (Chapter 448, SB 63)ê

 

    2.  “Design-build contract” means a contract between a public body and a design-build team in which the design-build team agrees to design and construct a public work.

    3.  “Design-build team” means an entity that consists of:

    (a) At least one person who is licensed as a general engineering contractor or a general building contractor pursuant to chapter 624 of NRS; and

    (b) For a public work that consists of:

         (1) A building and its site, at least one person who holds a certificate of registration to practice architecture pursuant to chapter 623 of NRS.

         (2) Anything other than a building and its site, at least one person who holds a certificate of registration to practice architecture pursuant to chapter 623 of NRS or is licensed as a professional engineer pursuant to chapter 625 of NRS.

    4.  “Design professional” means a person with a professional license or certificate issued pursuant to chapter 623, 623A or 625 of NRS.

    5.  “Eligible bidder” means a person who is:

    (a) Found to be a responsible and responsive contractor by a local government which requests bids for a public work in accordance with paragraph (b) of subsection 1 of NRS 338.1373; or

    (b) Determined by a public body which awarded a contract for a public work pursuant to NRS 338.1375 to 338.1389, inclusive, to be qualified to bid on that contract pursuant to NRS 338.1379 or was exempt from meeting such qualifications pursuant to NRS 338.1383.

    6.  “General contractor” means a person who is licensed to conduct business in one, or both, of the following branches of the contracting business:

    (a) General engineering contracting, as described in subsection 2 of NRS 624.215.

    (b) General building contracting, as described in subsection 3 of NRS 624.215.

    7.  “Local government” means every political subdivision or other entity which has the right to levy or receive money from ad valorem or other taxes or any mandatory assessments, and includes, without limitation, counties, cities, towns, boards, school districts and other districts organized pursuant to chapters 244A, 309, 318, 379, 474, 541, 543 and 555 of NRS, NRS 450.550 to 450.750, inclusive, and any agency or department of a county or city which prepares a budget separate from that of the parent political subdivision.

    [7.] 8.  “Offense” means failing to:

    (a) Pay the prevailing wage required pursuant to this chapter;

    (b) Pay the contributions for unemployment compensation required pursuant to chapter 612 of NRS;

    (c) Provide and secure compensation for employees required pursuant to chapters 616A to 617, inclusive, of NRS; or

    (d) Comply with subsection 4 or 5 of NRS 338.070.

    [8.] 9.  “Prime contractor” means a person who:

    (a) Contracts to construct an entire project;

    (b) Coordinates all work performed on the entire project;

    (c) Uses his own work force to perform all or a part of the construction, repair or reconstruction of the project; and


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ê2001 Statutes of Nevada, Page 2260 (Chapter 448, SB 63)ê

 

    (d) Contracts for the services of any subcontractor or independent contractor or is responsible for payment to any contracted subcontractors or independent contractors.

    [9.]

The term includes, without limitation, a general contractor or a specialty contractor who is authorized to bid on a project pursuant to section 2 or 4 of this act.

    10.  “Public body” means the state, county, city, town, school district or any public agency of this state or its political subdivisions sponsoring or financing a public work.

    [10.] 11.  “Public work” means any project for the new construction, repair or reconstruction of:

    (a) A project financed in whole or in part from public money for:

         (1) Public buildings;

         (2) Jails and prisons;

         (3) Public roads;

         (4) Public highways;

         (5) Public streets and alleys;

         (6) Public utilities which are financed in whole or in part by public money;

         (7) Publicly owned water mains and sewers;

         (8) Public parks and playgrounds;

         (9) Public convention facilities which are financed at least in part with public funds; and

         (10) All other publicly owned works and property whose cost as a whole exceeds $20,000. Each separate unit that is a part of a project is included in the cost of the project to determine whether a project meets that threshold.

    (b) A building for the University and Community College System of Nevada of which 25 percent or more of the costs of the building as a whole are paid from money appropriated by this state or from federal money.

    [11.] 12.  “Specialty contractor” means a [contractor whose operations as such are the performance of construction work requiring special skill and whose principal contracting business involves the use of specialized building trades or crafts.

    12.] person who is licensed to conduct business as described in subsection 4 of NRS 624.215.

    13.  “Stand-alone underground utility project” means an underground utility project that is not integrated into a larger project, including, without limitation:

    (a) An underground sewer line or an underground pipeline for the conveyance of water, including facilities appurtenant thereto; and

    (b) A project for the construction or installation of a storm drain, including facilities appurtenant thereto,

that is not located at the site of a public work for the design and construction of which a public body is authorized to contract with a design-build team pursuant to subsection 2 of NRS 338.1711.

    [13.] 14.  “Wages” means:

    (a) The basic hourly rate of pay; and

    (b) The amount of pension, health and welfare, vacation and holiday pay, the cost of apprenticeship training or other similar programs or other bona fide fringe benefits which are a benefit to the workman.


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ê2001 Statutes of Nevada, Page 2261 (Chapter 448, SB 63)ê

 

    [14.] 15.  “Workman” means a skilled mechanic, skilled workman, semiskilled mechanic, semiskilled workman or unskilled workman. The term does not include a design professional.

    Sec. 6.  NRS 338.010 is hereby amended to read as follows:

    338.010  As used in this chapter:

    1.  “Day labor” means all cases where public bodies, their officers, agents or employees, hire, supervise and pay the wages thereof directly to a workman or workmen employed by them on public works by the day and not under a contract in writing.

    2.  “Eligible bidder” means a person who is:

    (a) Found to be a responsible and responsive contractor by a local government which requests bids for a public work in accordance with paragraph (b) of subsection 1 of NRS 338.1373; or

    (b) Determined by a public body which awarded a contract for a public work pursuant to NRS 338.1375 to 338.1389, inclusive, to be qualified to bid on that contract pursuant to NRS 338.1379 or was exempt from meeting such qualifications pursuant to NRS 338.1383.

    3.  “General contractor” means a person who is licensed to conduct business in one, or both, of the following branches of the contracting business:

    (a) General engineering contracting, as described in subsection 2 of NRS 624.215.

    (b) General building contracting, as described in subsection 2 of NRS 624.215.

    4.  “Local government” means every political subdivision or other entity which has the right to levy or receive money from ad valorem or other taxes or any mandatory assessments, and includes, without limitation, counties, cities, towns, boards, school districts and other districts organized pursuant to chapters 244A, 309, 318, 379, 474, 541, 543 and 555 of NRS, NRS 450.550 to 450.750, inclusive, and any agency or department of a county or city which prepares a budget separate from that of the parent political subdivision.

    [4.] 5.  “Offense” means failing to:

    (a) Pay the prevailing wage required pursuant to this chapter;

    (b) Pay the contributions for unemployment compensation required pursuant to chapter 612 of NRS;

    (c) Provide and secure compensation for employees required pursuant to chapters 616A to 617, inclusive, of NRS; or

    (d) Comply with subsection 4 or 5 of NRS 338.070.

    [5.] 6.  “Prime contractor” means a person who:

    (a) Contracts to complete an entire project;

    (b) Coordinates all work performed on the entire project;

    (c) Uses his own work force to perform all or a part of the construction, repair or reconstruction of the project; and

    (d) Contracts for the services of any subcontractor or independent contractor or is responsible for payment to any contracted subcontractors or independent contractors.

    [6.]

The term includes, without limitation, a general contractor or a specialty contractor who is authorized to bid on a project pursuant to section 2 or 4 of this act.


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ê2001 Statutes of Nevada, Page 2262 (Chapter 448, SB 63)ê

 

    7.  “Public body” means the state, county, city, town, school district or any public agency of this state or its political subdivisions sponsoring or financing a public work.

    [7.] 8.  “Public work” means any project for the new construction, repair or reconstruction of:

    (a) A project financed in whole or in part from public money for:

         (1) Public buildings;

         (2) Jails and prisons;

         (3) Public roads;

         (4) Public highways;

         (5) Public streets and alleys;

         (6) Public utilities which are financed in whole or in part by public money;

         (7) Publicly owned water mains and sewers;

         (8) Public parks and playgrounds;

         (9) Public convention facilities which are financed at least in part with public funds; and

         (10) Any other publicly owned works and property whose cost as a whole exceeds $20,000. Each separate unit that is a part of a project is included in the cost of the project to determine whether a project meets that threshold.

    (b) A building for the University and Community College System of Nevada of which 25 percent or more of the costs of the building as a whole are paid from money appropriated by this state or from federal money.

    [8.] 9.  “Specialty contractor” means a person who is licensed to conduct business as described in subsection 4 of NRS 624.215.

    10.  “Wages” means:

    (a) The basic hourly rate of pay; and

    (b) The amount of pension, health and welfare, vacation and holiday pay, the cost of apprenticeship training or other similar programs or other bona fide fringe benefits which are a benefit to the workman.

    [9.] 11.  “Workman” means a skilled mechanic, skilled workman, semiskilled mechanic, semiskilled workman or unskilled workman. The term does not include a “design professional” as that term is defined in NRS 338.155.

    Sec. 7.  NRS 338.1373 is hereby amended to read as follows:

    338.1373  1.  A local government shall award a contract for the construction, alteration or repair of a public work pursuant to the provisions of:

    (a) NRS 338.1375 to 338.1389, inclusive [;] , and sections 2 and 3 of this act; or

    (b) NRS 338.143, 338.145 and 338.147 [.] and section 4 of this act.

    2.  The provisions of NRS 338.1375 to 338.1383, inclusive, and section 2 of this act do not apply with respect to contracts for the construction, reconstruction, improvement and maintenance of highways that are awarded by the department of transportation pursuant to NRS 408.313 to 408.433, inclusive, and section 1 of Assembly Bill No. 86 of this [act.] session.

    Sec. 8.  NRS 338.1389 is hereby amended to read as follows:

    338.1389  1.  Except as otherwise provided in NRS 338.1385 and 338.1711 to 338.1727, inclusive, a public body shall award a contract for a public work to the contractor who submits the best bid.


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ê2001 Statutes of Nevada, Page 2263 (Chapter 448, SB 63)ê

 

    2.  Except as otherwise provided in subsection [8] 10 or limited by subsection [9,] 11, for the purposes of this section, a contractor who:

    (a) Has been determined by the public body to be a qualified bidder pursuant to NRS 338.1379 or is exempt from meeting such requirements pursuant to NRS 338.1373 or 338.1383; and

    (b) At the time he submits his bid, provides to the public body a copy of a certificate of eligibility to receive a preference in bidding on public works issued to him by the state contractors’ board pursuant to subsection 3 [,] or 4,

shall be deemed to have submitted a better bid than a competing contractor who has not provided a copy of such a valid certificate of eligibility if the amount of his bid is not more than 5 percent higher than the amount bid by the competing contractor.

    3.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a general contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the general contractor has [:] , while licensed as a general contractor in this state:

    (a) Paid [:] directly, on his own behalf:

         (1) The sales and use taxes imposed pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan , [for employees,] all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a general contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    4.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a specialty contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the specialty contractor has, while licensed as a specialty contractor in this state:

    (a) Paid directly, on his own behalf:

         (1) The sales and use taxes pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;


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ê2001 Statutes of Nevada, Page 2264 (Chapter 448, SB 63)ê

 

the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan, all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a specialty contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    5.  For the purposes of complying with the requirements set forth in paragraph (a) of subsection 3 [, a general] and paragraph (a) of subsection 4, a contractor shall be deemed to have paid:

    (a) Sales and use taxes and governmental services taxes that were paid in this state by an affiliate or parent company of the contractor, if the affiliate or parent company is also a general contractor [;] or specialty contractor, as applicable; and

    (b) Sales and use taxes that were paid in this state by a joint venture in which the contractor is a participant, in proportion to the amount of interest the contractor has in the joint venture.

    [5.] 6.  A contractor who has received a certificate of eligibility to receive a preference in bidding on public works from the state contractors’ board pursuant to subsection 3 or 4 shall, at the time for the annual renewal of his contractor’s license pursuant to NRS 624.283, submit to the board an affidavit from a certified public accountant setting forth that the contractor has, during the immediately preceding 12 months, paid the taxes required pursuant to paragraph (a) of subsection 3 or paragraph (a) of subsection 4, as applicable, to maintain his eligibility to hold such a certificate.

    [6.] 7.  A contractor who fails to submit an affidavit to the board pursuant to subsection [5] 6 ceases to be eligible to receive a preference in bidding on public works unless he reapplies for and receives a certificate of eligibility pursuant to subsection 3 [.

    7.] or 4, as applicable.

    8.  If a contractor holds more than one contractor’s license, he must submit a separate application for each license pursuant to which he wishes to qualify for a preference in bidding. Upon issuance, the certificate of eligibility to receive a preference in bidding on public works becomes part of the contractor’s license for which the contractor submitted the application.

    9.  If a contractor who applies to the state contractors’ board for a certificate of eligibility to receive a preference in bidding on public works submits false information to the board regarding the required payment of taxes, the contractor is not eligible to receive a preference in bidding on public works for a period of 5 years after the date on which the board becomes aware of the submission of the false information.


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ê2001 Statutes of Nevada, Page 2265 (Chapter 448, SB 63)ê

 

public works for a period of 5 years after the date on which the board becomes aware of the submission of the false information.

    [8.] 10.  If any federal statute or regulation precludes the granting of federal assistance or reduces the amount of that assistance for a particular public work because of the provisions of subsection 2, those provisions do not apply insofar as their application would preclude or reduce federal assistance for that work. The provisions of subsection 2 do not apply to any contract for a public work which is expected to cost less than $250,000.

    [9.] 11.  Except as otherwise provided in subsection 2 of NRS 338.1727, if a bid is submitted by two or more contractors as a joint venture or by one of them as a joint venturer, the provisions of subsection 2 apply only if both or all of the joint venturers separately meet the requirements of that subsection.

    [10.] 12.  The state contractors’ board shall adopt regulations and may assess reasonable fees relating to the certification of contractors for a preference in bidding on public works.

    [11.] 13.  A person or entity who believes that a contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works may challenge the validity of the certificate by filing a written objection with the public body to which the contractor has submitted a bid or proposal on a contract for the construction of a public work. A written objection authorized pursuant to this subsection must:

    (a) Set forth proof or substantiating evidence to support the belief of the person or entity that the contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works; and

    (b) Be filed with the public body at or after the time at which the contractor submitted the bid or proposal to the public body and before the time at which the public body awards the contract for which the bid or proposal was submitted.

    [12.] 14.  If a public body receives a written objection pursuant to subsection [11,] 13, the public body shall determine whether the objection is accompanied by the proof or substantiating evidence required pursuant to paragraph (a) of that subsection. If the public body determines that the objection is not accompanied by the required proof or substantiating evidence, the public body shall dismiss the objection and may proceed immediately to award the contract. If the public body determines that the objection is accompanied by the required proof or substantiating evidence, the public body shall determine whether the contractor qualifies for the certificate pursuant to the provisions of this section and may proceed to award the contract accordingly.

    Sec. 9.  NRS 338.1389 is hereby amended to read as follows:

    338.1389  1.  Except as otherwise provided in NRS 338.1385, a public body shall award a contract for a public work to the contractor who submits the best bid.

    2.  Except as otherwise provided in subsection [8] 10 or limited by subsection [9,] 11, for the purposes of this section, a contractor who:

    (a) Has been determined by the public body to be a qualified bidder pursuant to NRS 338.1379 or is exempt from meeting such requirements pursuant to NRS 338.1373 or 338.1383; and


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2266 (Chapter 448, SB 63)ê

 

    (b) At the time he submits his bid, provides to the public body a copy of a certificate of eligibility to receive a preference in bidding on public works issued to him by the state contractors’ board pursuant to subsection 3 [,] or 4,

shall be deemed to have submitted a better bid than a competing contractor who has not provided a copy of such a valid certificate of eligibility if the amount of his bid is not more than 5 percent higher than the amount bid by the competing contractor.

    3.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a general contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the general contractor has [:] , while licensed as a general contractor in this state:

    (a) Paid [:] directly, on his own behalf:

         (1) The sales and use taxes imposed pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan , [for employees,] all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a general contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    4.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a specialty contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the specialty contractor has, while licensed as a specialty contractor in this state:

    (a) Paid directly, on his own behalf:

         (1) The sales and use taxes pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;


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ê2001 Statutes of Nevada, Page 2267 (Chapter 448, SB 63)ê

 

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan, all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a specialty contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    5.  For the purposes of complying with the requirements set forth in paragraph (a) of subsection 3 [, a general] and paragraph (a) of subsection 4, a contractor shall be deemed to have paid:

    (a) Sales and use taxes and governmental services taxes that were paid in this state by an affiliate or parent company of the contractor, if the affiliate or parent company is also a general contractor [;] or specialty contractor, as applicable; and

    (b) Sales and use taxes that were paid in this state by a joint venture in which the contractor is a participant, in proportion to the amount of interest the contractor has in the joint venture.

    [5.] 6.  A contractor who has received a certificate of eligibility to receive a preference in bidding on public works from the state contractors’ board pursuant to subsection 3 or 4 shall, at the time for the annual renewal of his contractor’s license pursuant to NRS 624.283, submit to the board an affidavit from a certified public accountant setting forth that the contractor has, during the immediately preceding 12 months, paid the taxes required pursuant to paragraph (a) of subsection 3 or paragraph (a) of subsection 4, as applicable, to maintain his eligibility to hold such a certificate.

    [6.] 7.  A contractor who fails to submit an affidavit to the board pursuant to subsection [5] 6 ceases to be eligible to receive a preference in bidding on public works unless he reapplies for and receives a certificate of eligibility pursuant to subsection 3 [.

    7.] or 4, as applicable.

    8.  If a contractor holds more than one contractor’s license, he must submit a separate application for each license pursuant to which he wishes to qualify for a preference in bidding. Upon issuance, the certificate of eligibility to receive a preference in bidding on public works becomes part of the contractor’s license for which the contractor submitted the application.

    9.  If a contractor who applies to the state contractors’ board for a certificate of eligibility to receive a preference in bidding on public works submits false information to the board regarding the required payment of taxes, the contractor is not eligible to receive a preference in bidding on public works for a period of 5 years after the date on which the board becomes aware of the submission of the false information.

    [8.] 10.  If any federal statute or regulation precludes the granting of federal assistance or reduces the amount of that assistance for a particular public work because of the provisions of subsection 2, those provisions do not apply insofar as their application would preclude or reduce federal assistance for that work.


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2268 (Chapter 448, SB 63)ê

 

not apply insofar as their application would preclude or reduce federal assistance for that work. The provisions of subsection 2 do not apply to any contract for a public work which is expected to cost less than $250,000.

    [9.] 11.  If a bid is submitted by two or more contractors as a joint venture or by one of them as a joint venturer, the provisions of subsection 2 apply only if both or all of the joint venturers separately meet the requirements of that subsection.

    [10.] 12.  The state contractors’ board shall adopt regulations and may assess reasonable fees relating to the certification of contractors for a preference in bidding on public works.

    [11.] 13.  A person or entity who believes that a contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works may challenge the validity of the certificate by filing a written objection with the public body to which the contractor has submitted a bid or proposal on a contract for the construction of a public work. A written objection authorized pursuant to this subsection must:

    (a) Set forth proof or substantiating evidence to support the belief of the person or entity that the contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works; and

    (b) Be filed with the public body at or after the time at which the contractor submitted the bid or proposal to the public body and before the time at which the public body awards the contract for which the bid or proposal was submitted.

    [12.] 14.  If a public body receives a written objection pursuant to subsection [11,] 13, the public body shall determine whether the objection is accompanied by the proof or substantiating evidence required pursuant to paragraph (a) of that subsection. If the public body determines that the objection is not accompanied by the required proof or substantiating evidence, the public body shall dismiss the objection and may proceed immediately to award the contract. If the public body determines that the objection is accompanied by the required proof or substantiating evidence, the public body shall determine whether the contractor qualifies for the certificate pursuant to the provisions of this section and may proceed to award the contract accordingly.

    Sec. 10.  NRS 338.141 is hereby amended to read as follows:

    338.141  1.  Except as otherwise provided in subsection 2, each bid submitted to any officer, department, board or commission for the construction of any public work or improvement must include:

    (a) The name of each subcontractor who will provide labor or a portion of the work or improvement to the contractor for which he will be paid an amount exceeding 5 percent of the prime contractor’s total bid. Within 2 hours after the completion of the opening of the bids, the [general] contractors who submitted the three lowest bids must submit a list containing the name of each subcontractor who will provide labor or a portion of the work or improvement to the contractor for which he will be paid an amount exceeding 1 percent of the prime contractor’s total bid or $50,000, whichever is greater, and the number of the license issued to the subcontractor pursuant to chapter 624 of NRS. If a [general] contractor fails to submit such a list within the required time, his bid shall be deemed not responsive.

    (b) A description of the portion of the work or improvement which each subcontractor named in the bid will complete.


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ê2001 Statutes of Nevada, Page 2269 (Chapter 448, SB 63)ê

 

    2.  The contractor shall list in his bid pursuant to subsection 1 the name of a subcontractor for each portion of the project that will be completed by a subcontractor.

    3.  A contractor whose bid is accepted shall not substitute any person for a subcontractor who is named in the bid, unless:

    (a) The awarding authority objects to the subcontractor, requests in writing a change in the subcontractor and pays any increase in costs resulting from the change; or

    (b) The substitution is approved by the awarding authority or an authorized representative of the awarding authority. The substitution must be approved if the awarding authority or authorized representative of the awarding authority determines that:

         (1) The named subcontractor, after having a reasonable opportunity, fails or refuses to execute a written contract with the contractor which was offered to the subcontractor with the same general terms that all other subcontractors on the project were offered;

         (2) The named subcontractor files for bankruptcy or becomes insolvent; or

         (3) The named subcontractor fails or refuses to perform his subcontract within a reasonable time or is unable to furnish a performance bond and payment bond pursuant to NRS 339.025.

    4.  As used in this section, “general terms” means the terms and conditions of a contract that set the basic requirements for a project and apply without regard to the particular trade or specialty of a subcontractor, but does not include any provision that controls or relates to the specific portion of the project that will be completed by a subcontractor, including, without limitation, the materials to be used by the subcontractor or other details of the work to be performed by the subcontractor.

    Sec. 11.  NRS 338.147 is hereby amended to read as follows:

    338.147  1.  Except as otherwise provided in NRS 338.143 and 338.1711 to 338.1727, inclusive, a local government shall award a contract for a public work to the contractor who submits the best bid.

    2.  Except as otherwise provided in subsection [8] 10 or limited by subsection [9,] 11, for the purposes of this section, a contractor who:

    (a) Has been found to be a responsible and responsive contractor by the local government; and

    (b) At the time he submits his bid, provides to the local government a copy of a certificate of eligibility to receive a preference in bidding on public works issued to him by the state contractors’ board pursuant to subsection 3 [,] or 4,

shall be deemed to have submitted a better bid than a competing contractor who has not provided a copy of such a valid certificate of eligibility if the amount of his bid is not more than 5 percent higher than the amount bid by the competing contractor.

    3.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a general contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the general contractor has [:] , while licensed as a general contractor in this state:

    (a) Paid [:] directly, on his own behalf:


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2270 (Chapter 448, SB 63)ê

 

         (1) The sales and use taxes imposed pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan , [for employees,] all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a general contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    4.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a specialty contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the specialty contractor has, while licensed as a specialty contractor in this state:

    (a) Paid directly, on his own behalf:

         (1) The sales and use taxes pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan, all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a specialty contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2271 (Chapter 448, SB 63)ê

 

    5.  For the purposes of complying with the requirements set forth in paragraph (a) of subsection 3 [, a general] and paragraph (a) of subsection 4, a contractor shall be deemed to have paid:

    (a) Sales and use taxes and governmental services taxes that were paid in this state by an affiliate or parent company of the contractor, if the affiliate or parent company is also a general contractor [;] or specialty contractor, as applicable; and

    (b) Sales and use taxes that were paid in this state by a joint venture in which the contractor is a participant, in proportion to the amount of interest the contractor has in the joint venture.

    [5.] 6.  A contractor who has received a certificate of eligibility to receive a preference in bidding on public works from the state contractors’ board pursuant to subsection 3 or 4 shall, at the time for the annual renewal of his contractor’s license pursuant to NRS 624.283, submit to the board an affidavit from a certified public accountant setting forth that the contractor has, during the immediately preceding 12 months, paid the taxes required pursuant to paragraph (a) of subsection 3 or paragraph (a) of subsection 4, as applicable, to maintain his eligibility to hold such a certificate.

    [6.] 7.  A contractor who fails to submit an affidavit to the board pursuant to subsection [5] 6 ceases to be eligible to receive a preference in bidding on public works unless he reapplies for and receives a certificate of eligibility pursuant to subsection 3 [.

    7.] or 4, as applicable.

    8.  If a contractor holds more than one contractor’s license, he must submit a separate application for each license pursuant to which he wishes to qualify for a preference in bidding. Upon issuance, the certificate of eligibility to receive a preference in bidding on public works becomes part of the contractor’s license for which the contractor submitted the application.

    9.  If a contractor who applies to the state contractors’ board for a certificate of eligibility to receive a preference in bidding on public works submits false information to the board regarding the required payment of taxes, the contractor is not eligible to receive a preference in bidding on public works for a period of 5 years after the date on which the board becomes aware of the submission of the false information.

    [8.] 10.  If any federal statute or regulation precludes the granting of federal assistance or reduces the amount of that assistance for a particular public work because of the provisions of subsection 2, those provisions do not apply insofar as their application would preclude or reduce federal assistance for that work. The provisions of subsection 2 do not apply to any contract for a public work which is expected to cost less than $250,000.

    [9.] 11.  Except as otherwise provided in subsection 2 of NRS 338.1727 and subsection 2 of NRS 408.3886 if a bid is submitted by two or more contractors as a joint venture or by one of them as a joint venturer, the provisions of subsection 2 apply only if both or all of the joint venturers separately meet the requirements of that subsection.

    [10.] 12.  The state contractors’ board shall adopt regulations and may assess reasonable fees relating to the certification of contractors for a preference in bidding on public works.

    [11.] 13.  A person or entity who believes that a contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works may challenge the validity of the certificate by filing a written objection with the public body to which the contractor has submitted a bid or proposal on a contract for the completion of a public work.


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ê2001 Statutes of Nevada, Page 2272 (Chapter 448, SB 63)ê

 

objection with the public body to which the contractor has submitted a bid or proposal on a contract for the completion of a public work. A written objection authorized pursuant to this subsection must:

    (a) Set forth proof or substantiating evidence to support the belief of the person or entity that the contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works; and

    (b) Be filed with the public body at or after the time at which the contractor submitted the bid or proposal to the public body and before the time at which the public body awards the contract for which the bid or proposal was submitted.

    [12.] 14.  If a public body receives a written objection pursuant to subsection [11,] 13, the public body shall determine whether the objection is accompanied by the proof or substantiating evidence required pursuant to paragraph (a) of that subsection. If the public body determines that the objection is not accompanied by the required proof or substantiating evidence, the public body shall dismiss the objection and may proceed immediately to award the contract. If the public body determines that the objection is accompanied by the required proof or substantiating evidence, the public body shall determine whether the contractor qualifies for the certificate pursuant to the provisions of this section and may proceed to award the contract accordingly.

    Sec. 12.  NRS 338.147 is hereby amended to read as follows:

    338.147  1.  Except as otherwise provided in NRS 338.143, a local government shall award a contract for a public work to the contractor who submits the best bid.

    2.  Except as otherwise provided in subsection [8] 10 or limited by subsection [9,] 11, for the purposes of this section, a contractor who:

    (a) Has been found to be a responsible and responsive contractor by the local government; and

    (b) At the time he submits his bid, provides to the local government a copy of a certificate of eligibility to receive a preference in bidding on public works issued to him by the state contractors’ board pursuant to subsection 3 [,] or 4,

shall be deemed to have submitted a better bid than a competing contractor who has not provided a copy of such a valid certificate of eligibility if the amount of his bid is not more than 5 percent higher than the amount bid by the competing contractor.

    3.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a general contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the general contractor has [:] , while licensed as a general contractor in this state:

    (a) Paid [:] directly, on his own behalf:

         (1) The sales and use taxes imposed pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;


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ê2001 Statutes of Nevada, Page 2273 (Chapter 448, SB 63)ê

 

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan , [for employees,] all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a general contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    4.  The state contractors’ board shall issue a certificate of eligibility to receive a preference in bidding on public works to a specialty contractor who is licensed pursuant to the provisions of chapter 624 of NRS and submits to the board an affidavit from a certified public accountant setting forth that the specialty contractor has, while licensed as a specialty contractor in this state:

    (a) Paid directly, on his own behalf:

         (1) The sales and use taxes pursuant to chapters 372, 374 and 377 of NRS on materials used for construction in this state, including, without limitation, construction that is undertaken or carried out on land within the boundaries of this state that is managed by the Federal Government or is on an Indian reservation or Indian colony, of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant;

         (2) The governmental services tax imposed pursuant to chapter 371 of NRS on the vehicles used in the operation of his business in this state of not less than $5,000 for each consecutive 12-month period for 60 months immediately preceding the submission of the affidavit from the certified public accountant; or

         (3) Any combination of such sales and use taxes and governmental services tax; or

    (b) Acquired, by purchase, inheritance, gift or transfer through a stock option plan, all the assets and liabilities of a viable, operating construction firm that possesses a:

         (1) License as a specialty contractor pursuant to the provisions of chapter 624 of NRS; and

         (2) Certificate of eligibility to receive a preference in bidding on public works.

    5.  For the purposes of complying with the requirements set forth in paragraph (a) of subsection 3 [, a general] and paragraph (a) of subsection 4, a contractor shall be deemed to have paid:

    (a) Sales and use taxes and governmental services taxes that were paid in this state by an affiliate or parent company of the contractor, if the affiliate or parent company is also a general contractor [;] or specialty contractor, as applicable; and

    (b) Sales and use taxes that were paid in this state by a joint venture in which the contractor is a participant, in proportion to the amount of interest the contractor has in the joint venture.


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ê2001 Statutes of Nevada, Page 2274 (Chapter 448, SB 63)ê

 

    [5.] 6.  A contractor who has received a certificate of eligibility to receive a preference in bidding on public works from the state contractors’ board pursuant to subsection 3 or 4 shall, at the time for the annual renewal of his contractor’s license pursuant to NRS 624.283, submit to the board an affidavit from a certified public accountant setting forth that the contractor has, during the immediately preceding 12 months, paid the taxes required pursuant to paragraph (a) of subsection 3 or paragraph (a) of subsection 4, as applicable, to maintain his eligibility to hold such a certificate.

    [6.] 7.  A contractor who fails to submit an affidavit to the board pursuant to subsection [5] 6 ceases to be eligible to receive a preference in bidding on public works unless he reapplies for and receives a certificate of eligibility pursuant to subsection 3 [.

    7.] or 4, as applicable.

    8.  If a contractor holds more than one contractor’s license, he must submit a separate application for each license pursuant to which he wishes to qualify for a preference in bidding. Upon issuance, the certificate of eligibility to receive a preference in bidding on public works becomes part of the contractor’s license for which the contractor submitted the application.

    9.  If a contractor who applies to the state contractors’ board for a certificate of eligibility to receive a preference in bidding on public works submits false information to the board regarding the required payment of taxes, the contractor is not eligible to receive a preference in bidding on public works for a period of 5 years after the date on which the board becomes aware of the submission of the false information.

    [8.] 10.  If any federal statute or regulation precludes the granting of federal assistance or reduces the amount of that assistance for a particular public work because of the provisions of subsection 2, those provisions do not apply insofar as their application would preclude or reduce federal assistance for that work. The provisions of subsection 2 do not apply to any contract for a public work which is expected to cost less than $250,000.

    [9.] 11.  If a bid is submitted by two or more contractors as a joint venture or by one of them as a joint venturer, the provisions of subsection 2 apply only if both or all of the joint venturers separately meet the requirements of that subsection.

    [10.] 12.  The state contractors’ board shall adopt regulations and may assess reasonable fees relating to the certification of contractors for a preference in bidding on public works.

    [11.] 13.  A person or entity who believes that a contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works may challenge the validity of the certificate by filing a written objection with the public body to which the contractor has submitted a bid or proposal on a contract for the completion of a public work. A written objection authorized pursuant to this subsection must:

    (a) Set forth proof or substantiating evidence to support the belief of the person or entity that the contractor wrongfully holds a certificate of eligibility to receive a preference in bidding on public works; and

    (b) Be filed with the public body at or after the time at which the contractor submitted the bid or proposal to the public body and before the time at which the public body awards the contract for which the bid or proposal was submitted.


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ê2001 Statutes of Nevada, Page 2275 (Chapter 448, SB 63)ê

 

    [12.] 14.  If a public body receives a written objection pursuant to subsection [11,] 13, the public body shall determine whether the objection is accompanied by the proof or substantiating evidence required pursuant to paragraph (a) of that subsection. If the public body determines that the objection is not accompanied by the required proof or substantiating evidence, the public body shall dismiss the objection and may proceed immediately to award the contract. If the public body determines that the objection is accompanied by the required proof or substantiating evidence, the public body shall determine whether the contractor qualifies for the certificate pursuant to the provisions of this section and may proceed to award the contract accordingly.

    Sec. 13.  NRS 338.1711 is hereby amended to read as follows:

    338.1711  1.  Except as otherwise provided in this section, a public body shall contract with a prime contractor for the construction of a public work for which the estimated cost exceeds $100,000.

    2.  A public body may contract with a design-build team for the design and construction of a public work that is a discrete project if the public body determines that:

    (a) The public work is:

         (1) A plant or facility for the treatment and pumping of water or the treatment and disposal of wastewater or sewage, the estimated cost of which exceeds $100,000,000; or

         (2) Any other type of public work, except a stand-alone underground utility project, the estimated cost of which exceeds $30,000,000; and

    (b) Contracting with a design-build team will enable the public body to:

         (1) Design and construct the public work at a cost that is significantly lower than the cost that the public body would incur to design and construct the public work using a different method;

         (2) Design and construct the public work in a shorter time than would be required to design and construct the public work using a different method, if exigent circumstances require that the public work be designed and constructed within a short time; or

         (3) Ensure that the design and construction of the public work is properly coordinated, if the public work is unique, highly technical and complex in nature.

    3.  In a county whose population is 400,000 or more, a public body that is responsible for financing public works may, for its own public works and those financed by a different public body, including, without limitation, an airport if the airport is owned and operated as a department of the public body, contract with a design-build team once in each fiscal year for the design and construction of a public work if the public body determines that:

    (a) The estimated cost of the public work is at least $5,000,000 but less than $30,000,000; and

    (b) Contracting with a design-build team will enable the public body to:

         (1) Design and construct the public work at a cost that is significantly lower than the cost that the public body would incur to design and construct the public work using a different method;

         (2) Design and construct the public work in a shorter time than would be required to design and construct the public work using a different method, if exigent circumstances require that the public work be designed and constructed within a short time; or


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ê2001 Statutes of Nevada, Page 2276 (Chapter 448, SB 63)ê

 

         (3) Ensure that the design and construction of the public work is properly coordinated, if the public work is unique, highly technical and complex in nature.

    4.  Notwithstanding the provisions of subsections 1, 2 and 3, a public body may contract with:

    (a) A nonprofit organization for the design and construction of a project to restore, enhance or develop wetlands.

    (b) A prime contractor [, specialty contractor] or design-build team with respect to a public work if the public body determines that the public work is:

         (1) Not part of a larger public work; and

         (2) Limited in scope to:

             (I) Removal of asbestos;

             (II) Replacement of equipment or systems for heating, ventilation and air-conditioning;

             (III) Replacement of a roof;

             (IV) Landscaping; or

             (V) Restoration, enhancement or development of wetlands.

    Sec. 14.  NRS 338.1715 is hereby amended to read as follows:

    338.1715  1.  A public body that is required to contract with a prime contractor pursuant to subsection 1 of NRS 338.1711 or elects to contract with a [specialty] prime contractor pursuant to subsection 4 of NRS 338.1711 shall select the prime contractor [or specialty contractor, as appropriate,] in accordance with the procedures for bidding that are set forth in:

    (a) The provisions of NRS 338.1375 to 338.1389, inclusive [;] and sections 2 and 3 of this act; or

    (b) NRS 338.143, 338.145 and 338.147 [,] and section 4 of this act, if the public body is a local government that elects to award a contract for a public work in accordance with paragraph (b) of subsection 1 of NRS 338.1373.

    2.  A public body that contracts with a design-build team pursuant to NRS 338.1711 and 338.1713 shall select the design-build team in accordance with NRS 338.1721 to 338.1727, inclusive.

    Sec. 14.5.  Section 1 of Senate Bill No. 255 of this session is hereby amended to read as follows:

    Section 1.  NRS 338.010 is hereby amended to read as follows:

    338.010  As used in this chapter:

    1.  “Day labor” means all cases where public bodies, their officers, agents or employees, hire, supervise and pay the wages thereof directly to a workman or workmen employed by them on public works by the day and not under a contract in writing.

    2.  “Design-build contract” means a contract between a public body and a design-build team in which the design-build team agrees to design and construct a public work.

    3.  “Design-build team” means an entity that consists of:

    (a) At least one person who is licensed as a general engineering contractor or a general building contractor pursuant to chapter 624 of NRS; and

    (b) For a public work that consists of:

         (1) A building and its site, at least one person who holds a certificate of registration to practice architecture pursuant to chapter 623 of NRS.


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ê2001 Statutes of Nevada, Page 2277 (Chapter 448, SB 63)ê

 

         (2) Anything other than a building and its site, at least one person who holds a certificate of registration to practice architecture pursuant to chapter 623 of NRS or is licensed as a professional engineer pursuant to chapter 625 of NRS.

    4.  “Design professional” means [a person with a professional license or certificate issued pursuant to chapter 623, 623A or 625 of NRS.] :

    (a) A person who is licensed as a professional engineer pursuant to chapter 625 of NRS;

    (b) A person who is licensed as a professional land surveyor pursuant to chapter 625 of NRS;

    (c) A person who holds a certificate of registration to engage in the practice of architecture pursuant to chapter 623 of NRS;

    (d) A person who holds a certificate of registration to engage in the practice of landscape architecture pursuant to chapter 623A of NRS; or

    (e) A business entity that engages in the practice of professional engineering, land surveying, architecture or landscape architecture.

    5.  “Eligible bidder” means a person who is:

    (a) Found to be a responsible and responsive contractor by a local government which requests bids for a public work in accordance with paragraph (b) of subsection 1 of NRS 338.1373; or

    (b) Determined by a public body which awarded a contract for a public work pursuant to NRS 338.1375 to 338.1389, inclusive, to be qualified to bid on that contract pursuant to NRS 338.1379 or was exempt from meeting such qualifications pursuant to NRS 338.1383.

    6.  “General contractor” means a person who is licensed to conduct business in one, or both, of the following branches of the contracting business:

    (a) General engineering contracting, as described in subsection 2 of NRS 624.215.

    (b) General building contracting, as described in subsection 3 of NRS 624.215.

    7.  “Local government” means every political subdivision or other entity which has the right to levy or receive money from ad valorem or other taxes or any mandatory assessments, and includes, without limitation, counties, cities, towns, boards, school districts and other districts organized pursuant to chapters 244A, 309, 318, 379, 474, 541, 543 and 555 of NRS, NRS 450.550 to 450.750, inclusive, and any agency or department of a county or city which prepares a budget separate from that of the parent political subdivision.

    8.  “Offense” means failing to:

    (a) Pay the prevailing wage required pursuant to this chapter;

    (b) Pay the contributions for unemployment compensation required pursuant to chapter 612 of NRS;

    (c) Provide and secure compensation for employees required pursuant to chapters 616A to 617, inclusive, of NRS; or

    (d) Comply with subsection 4 or 5 of NRS 338.070.

    9.  “Prime contractor” means a person who:

    (a) Contracts to construct an entire project;

    (b) Coordinates all work performed on the entire project;


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ê2001 Statutes of Nevada, Page 2278 (Chapter 448, SB 63)ê

 

    (c) Uses his own work force to perform all or a part of the construction, repair or reconstruction of the project; and

    (d) Contracts for the services of any subcontractor or independent contractor or is responsible for payment to any contracted subcontractors or independent contractors.

The term includes, without limitation, a general contractor or a specialty contractor who is authorized to bid on a project pursuant to section 2 or 4 of Senate Bill No. 63 of this [act.] session.

    10.  “Public body” means the state, county, city, town, school district or any public agency of this state or its political subdivisions sponsoring or financing a public work.

    11.  “Public work” means any project for the new construction, repair or reconstruction of:

    (a) A project financed in whole or in part from public money for:

         (1) Public buildings;

         (2) Jails and prisons;

         (3) Public roads;

         (4) Public highways;

         (5) Public streets and alleys;

         (6) Public utilities which are financed in whole or in part by public money;

         (7) Publicly owned water mains and sewers;

         (8) Public parks and playgrounds;

         (9) Public convention facilities which are financed at least in part with public funds; and

         (10) All other publicly owned works and property whose cost as a whole exceeds $20,000. Each separate unit that is a part of a project is included in the cost of the project to determine whether a project meets that threshold.

    (b) A building for the University and Community College System of Nevada of which 25 percent or more of the costs of the building as a whole are paid from money appropriated by this state or from federal money.

    12.  “Specialty contractor” means a person who is licensed to conduct business as described in subsection 4 of NRS 624.215.

    13.  “Stand-alone underground utility project” means an underground utility project that is not integrated into a larger project, including, without limitation:

    (a) An underground sewer line or an underground pipeline for the conveyance of water, including facilities appurtenant thereto; and

    (b) A project for the construction or installation of a storm drain, including facilities appurtenant thereto,

that is not located at the site of a public work for the design and construction of which a public body is authorized to contract with a design-build team pursuant to subsection 2 of NRS 338.1711.

    14.  “Wages” means:

    (a) The basic hourly rate of pay; and

    (b) The amount of pension, health and welfare, vacation and holiday pay, the cost of apprenticeship training or other similar programs or other bona fide fringe benefits which are a benefit to the workman.


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ê2001 Statutes of Nevada, Page 2279 (Chapter 448, SB 63)ê

 

    15.  “Workman” means a skilled mechanic, skilled workman, semiskilled mechanic, semiskilled workman or unskilled workman. The term does not include a design professional.

    Sec. 15.  1.  This section and sections 1 to 4, inclusive, 7, 10, 13 and 14 of this act become effective on July 1, 2001.

    2.  Sections 5, 8 and 11 of this act become effective at 12:01 a.m. on July 1, 2001.

    3.  Section 14.5 of this act becomes effective at 12:02 a.m. on July 1, 2001.

    4.  Sections 6 and 9 of this act become effective at 12:02 a.m. on October 1, 2003.

    5.  Section 12 of this act becomes effective at 12:03 a.m. on October 1, 2003.

    6.  Sections 5, 8, 11, 13 and 14 of this act expire by limitation on October 1, 2003.

________

 

CHAPTER 449, SB 150

Senate Bill No. 150–Committee on Government Affairs

 

CHAPTER 449

 

AN ACT relating to county government; authorizing a board of county commissioners to designate an animal as inherently dangerous and to provide by ordinance for civil liability for a person who violates certain ordinances relating to the control of animals; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 244.359 is hereby amended to read as follows:

    244.359  1.  Each board of county commissioners may enact and enforce an ordinance or ordinances:

    (a) Fixing, imposing and collecting an annual license fee on dogs and providing for the capture and disposal of all dogs on which the license fee is not paid.

    (b) Regulating or prohibiting the running at large and disposal of all kinds of animals.

    (c) Establishing a pound, appointing a poundkeeper and prescribing his duties.

    (d) Prohibiting cruelty to animals.

    (e) Designating an animal as inherently dangerous and requiring the owner of such an animal to obtain a policy of liability insurance for the animal in an amount determined by the board of county commissioners.

    2.  Any ordinance or ordinances enacted pursuant to the provisions of paragraphs (a) and (b) of subsection 1 may apply throughout an entire county or govern only a limited area within the county which shall be specified in the ordinance or ordinances.

    3.  Except as otherwise provided in this subsection, a board of county commissioners may by ordinance provide that the violation of a particular ordinance enacted pursuant to this section imposes a civil liability to the county in an amount not to exceed $500, instead of a criminal penalty. An ordinance enacted pursuant to this section that creates an offense relating to bites of animals, vicious or dangerous animals, horse tripping or cruelty to animals must impose a criminal penalty for the offense.


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ê2001 Statutes of Nevada, Page 2280 (Chapter 449, SB 150)ê

 

ordinance enacted pursuant to this section that creates an offense relating to bites of animals, vicious or dangerous animals, horse tripping or cruelty to animals must impose a criminal penalty for the offense. As used in this subsection, “horse tripping” does not include tripping a horse to provide medical or other health care for the horse.

    Sec. 2.  This act becomes effective upon passage and approval.

________

 

CHAPTER 450, SB 247

Senate Bill No. 247–Committee on Finance

 

CHAPTER 450

 

AN ACT making appropriations to the Department of Human Resources; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  There is hereby appropriated from the state general fund to the Department of Human Resources:

    1.  For an unanticipated shortfall in money budgeted for expenses relating to group homes, foster care, Medicare and subsidized adoptions at the Division of Child and Family Services the sum of $2,743,867.

    2.  For unanticipated additional utility expenses for the new hospital and for the cost of medications at the Nevada Mental Health Institute the sum of $435,950.

This appropriation is supplemental to that made by section 19 of chapter 571, Statutes of Nevada 1999, at pages 2981 and 2982, respectively.

    Sec. 2.  1.  There is hereby appropriated from the state general fund to the Division of Mental Health and Developmental Services of the Department of Human Resources the sum of $350,000 for repairs to the Southern Nevada Adult Mental Health Services.

    2.  The State Public Works Board shall let a single contract for project number 00-M25a, life safety upgrade, smoke barrier retrofit. The contract is exempt from the provisions relating to bids in NRS 341.145 to 341.151, inclusive.

    3.  Any remaining balance of the appropriation made by subsection 1 must not be committed for expenditure after June 30, 2002, and reverts to the state general fund as soon as all payments of money committed have been made.

    Sec. 3.  This act becomes effective upon passage and approval.

________

 


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ê2001 Statutes of Nevada, Page 2281ê

 

CHAPTER 451, SB 265

Senate Bill No. 265–Committee on Government Affairs

 

CHAPTER 451

 

AN ACT relating to zoning; requiring a city or county to pay just compensation or authorize an alternative location for certain nonconforming outdoor advertising structures under certain circumstances; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  Chapter 278 of NRS is hereby amended by adding thereto a new section to read as follows:

    1.  If a city or county, through the adoption, operation or enforcement of any ordinance or code, requires the removal of a nonconforming outdoor advertising structure, the city or county shall:

    (a) Pay just compensation for the loss of the nonconforming outdoor advertising structure to the owner of the nonconforming outdoor advertising structure and to the owner of the real property upon which the nonconforming outdoor advertising structure is located; or

    (b) Authorize the owner of the nonconforming outdoor advertising structure to relocate that structure to a site which is determined to be a comparable site by the owner of the nonconforming outdoor advertising structure  and which is approved by the city or county as an appropriate site for the structure.

    2.  If a city or county prohibits the owner of a nonconforming outdoor advertising structure from engaging in routine maintenance of the nonconforming outdoor advertising structure, the city or county shall provide just compensation or authorize a comparable alternative location for the nonconforming outdoor advertising structure in the same manner as if the city or county had required the removal of the nonconforming outdoor advertising structure pursuant to subsection 1.

    3.  A city or county shall not require the removal of a nonconforming outdoor advertising structure to occur pursuant to an amortization schedule, regardless of the length of the period set forth in the amortization schedule.

    4.  The requirements of subsection 1 do not apply to a nonconforming outdoor advertising structure that is:

    (a) Required to be removed as a result of the owner of the real property upon which the nonconforming outdoor advertising structure is located terminating the lease that governs the placement of the nonconforming outdoor advertising structure on that property pursuant to the terms of that lease; or

    (b) Destroyed or damaged in excess of 50 percent of its material structural value as a result of a natural disaster, including, without limitation, a fire, flood, earthquake, windstorm, rainstorm and snowstorm.

    5.  A city or county shall not require the removal of a nonconforming outdoor advertising structure as a condition to the development or redevelopment of the property upon which the nonconforming outdoor advertising structure is located without first holding a public hearing at which the owner of the nonconforming outdoor advertising structure has an opportunity to be heard.


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2282 (Chapter 451, SB 265)ê

 

an opportunity to be heard. The requirements of subsection 1 do not apply if, after the public hearing required by this subsection, a city or county requires the removal of the nonconforming outdoor advertising structure.

    6.  If the owner of a nonconforming outdoor advertising structure or the owner of the real property upon which the nonconforming outdoor advertising structure is located disagrees with the amount of just compensation the city or county determines should be paid to him, the owner may appeal the determination to a court of competent jurisdiction. In determining the amount of just compensation that should be paid to an owner pursuant to subsection 1, the court shall consider:

    (a) The uniqueness of the location of the property upon which the nonconforming outdoor advertising structure is erected;

    (b) Whether the nonconforming outdoor advertising structure can be relocated to a comparable site;

    (c) The amount of income generated by the nonconforming outdoor advertising structure; and

    (d) The length of time remaining on any applicable term of a lease governing the nonconforming outdoor advertising structure.

    7.  As used in this section:

    (a) “Amortization schedule” means an extended period over which a person is required to remove a nonconforming outdoor advertising structure.

    (b) “Just compensation” means the most probable price that a nonconforming outdoor advertising structure would bring in a competitive and open market under the conditions of a fair sale, without the price being affected by undue stimulus.

    (c) “Material structural value” means the cost of labor and materials necessary to erect an outdoor advertising structure. The term does not include any revenue or expenses related to the lease of real property upon which the outdoor advertising structure is located.

    (d) “Nonconforming outdoor advertising structure” means an outdoor advertising structure which is constructed or erected in conformance with all applicable local ordinances and codes in effect on the date a building permit is issued for the outdoor advertising structure and which does not conform subsequently because of a change to the local ordinances or codes. The term does not include an outdoor advertising structure that is authorized by a special use permit, conditional use permit, variance, waiver, condition of zoning or other approval for the use of land if, when the special use permit, conditional use permit, variance, waiver, condition of zoning or other approval for the use of land was first approved, the special use permit, conditional use permit, variance, waiver, condition of zoning or other approval for the use of land was limited by a specific condition which allowed or required the governing body of the city or county to conduct a review of the structure.

    (e) “Outdoor advertising structure” means any sign, display, billboard or other device that is designed, intended or used to advertise or inform readers about services rendered or goods produced or sold on property other than the property upon which the sign, display, billboard or other device is erected.

    (f) “Routine maintenance” means normal repair and upkeep of the structural integrity and appearance of a nonconforming outdoor advertising structure. The term does not include any increase in the size or height of the structure or any addition or enhancement to the structure that increases the visual effect of the structure or increases the impact on the use of the land in the area around the structure.


…………………………………………………………………………………………………………………

ê2001 Statutes of Nevada, Page 2283 (Chapter 451, SB 265)ê

 

height of the structure or any addition or enhancement to the structure that increases the visual effect of the structure or increases the impact on the use of the land in the area around the structure.

    Sec. 2.  This act becomes effective upon passage and approval.

________

 

CHAPTER 452, SB 395

Senate Bill No. 395–Senator McGinness

 

Joint Sponsor: Assemblyman Neighbors

 

CHAPTER 452

 

AN ACT relating to counties; detaching certain territory from Clark County and attaching that territory to Nye County; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 243.293 is hereby amended to read as follows:

    243.293  The boundary line between Nye and Clark counties is as follows: Beginning at the point of intersection of the north line of T. 16 S., R. 54 E., M.D.B. & M. and the meridian running north-south passing through “Red Bluff Springs,” Nevada; thence west along the north boundary of section 3, T. 16 S., R. 54 E., 400 feet more or less, to the north quarter corner of section 3, T. 16 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10, 15, 22, 27 and 34 to the south quarter corner of section 34, T. 16 S., R. 54 E.; thence east along the north boundary of section 3, T. 17 S., R. 54 E. to the north quarter corner of section 3, T. 17 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10, 15, 22, 27 and 34 to the south quarter corner of section 34, T. 17 S., R. 54 E. and the north quarter corner of section 3, T. 18 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10, 15, 22, 27 and 34 to the south quarter corner of section 34, T. 18 S., R. 54 E. and the north quarter corner of section 3, T. 19 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10, 15, 22, 27 and 34 to the south quarter corner of section 34, T. 19 S., R. 54 E. and the north quarter corner of section 3, T. 20 S., R. 54 E.; thence southerly along [center 1/4 section line through sections 3, 10, 15, 27 and 34 to the south quarter corner of section 34, T. 20 S., R. 54 E.; thence east along the north boundary of section 3, T. 21 S., R. 54 E. to the north quarter corner of section 3, T. 21 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10, 15, 22, 27 and 34 to the south quarter corner of section 34, T. 21 S., R. 54 E. and north quarter corner of section 3, T. 22 S., R. 54 E.; thence southerly along the center 1/4 section line through sections 3, 10 and 15, T. 22 S., R. 54 E. to the intersection of the north boundary of tract 38, T. 22 S., R. 54 E. near the center of section 15, T. 22 S., R. 54 E.; thence southerly through tract 38, 1 mile more or less, to the south boundary of tract 38 near the center of section 22, T. 22 S., R. 54 E.; thence southerly along the center 1/4 section line of sections 22 and 27, T. 22 S., R. 54 E. to the intersection of the state line between Nevada and California at a point 1900 feet, more or less, southeast of milepost 113 and 450 feet, more or less, northwest of the closing corner on the state line common to sections 15 and 22, T. 22 N., R. 10 E., S.B.B. & M.] the center 1/4 section line through sections 3, 10, 15 and 22 to the south quarter corner of section 22, T. 20 S., R.


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ê2001 Statutes of Nevada, Page 2284 (Chapter 452, SB 395)ê

 

of milepost 113 and 450 feet, more or less, northwest of the closing corner on the state line common to sections 15 and 22, T. 22 N., R. 10 E., S.B.B. & M.] the center 1/4 section line through sections 3, 10, 15 and 22 to the south quarter corner of section 22, T. 20 S., R. 54 E. and the north quarter corner of section 27, T. 20 S., R. 54 E.; thence east along the north boundary of sections 27, 26 and 25, T. 20 S., R. 54 E. to the range line between Ranges 54 and 55 E., M.D.B. & M.; thence southerly along that range line to the intersection of the state line between Nevada and California.

    Sec. 2.  This act becomes effective on July 1, 2001.

________

 

CHAPTER 453, SB 401

Senate Bill No. 401–Senators Rawson, Neal and O’Donnell

 

CHAPTER 453

 

AN ACT relating to the office of science, engineering and technology; transferring the office from the University and Community College System of Nevada to the Office of the Governor; revising the duties of the director of the office; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 223.085 is hereby amended to read as follows:

    223.085  1.  The governor may, within the limits of available money, employ such persons as he deems necessary to provide an appropriate staff for the office of the governor, including, without limitation, the agency for nuclear projects , the office of science, innovation and technology and the governor’s mansion. Any such employees are not in the classified or unclassified service of the state and serve at the pleasure of the governor.

    2.  The governor shall:

    (a) Determine the salaries and benefits of the persons employed pursuant to subsection 1, within limits of money available for that purpose; and

    (b) Adopt such rules and policies as he deems appropriate to establish the duties and employment rights of the persons employed pursuant to subsection 1.

    Sec. 2.  Chapter 231 of NRS is hereby amended by adding thereto the provisions set forth as sections 3 to 6, inclusive, of this act.

    Sec. 3.  1.  The office of science, innovation and technology is hereby established in the office of the governor.

    2.  The governor shall appoint the director of the office of science, innovation and technology. In making the appointment, the governor:

    (a) Shall give consideration to any recommendation which is submitted by the chancellor of the University and Community College System of Nevada.

    (b) May assemble a panel of persons with appropriate experience in science and technology to make recommendations of qualified candidates for the position of director.


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ê2001 Statutes of Nevada, Page 2285 (Chapter 453, SB 401)ê

 

    3.  The director shall devote his entire time and attention to the business of his office and shall not engage in any other gainful employment or occupation.

    4.  The director is not in the classified or unclassified service of the state and serves at the pleasure of the governor.

    Sec. 4.  The director of the office of science, innovation and technology shall:

    1.  Advise the governor on matters relating to science, innovation and technology.

    2.  Work in coordination with the commission on economic development to establish criteria and goals for economic development and diversification in this state in the areas of science, innovation and technology.

    3.  As directed by the governor, identify, recommend and carry out policies related to science, innovation and technology.

    4.  Report periodically to the chairman and executive director of the commission on economic development concerning the administration of the policies and programs of the office of science, innovation and technology.

    5.  Develop and coordinate efforts to attract biotechnological companies to this state.

    6.  Establish and maintain a clearinghouse of information regarding biotechnological business in this state.

    Sec. 5.  1.  The director of the office of science, innovation and technology may:

    (a) Accept any gift, donation, bequest or devise; and

    (b) Apply for and accept any grant, loan or other source of money,

to assist him in carrying out his duties.

    2.  The director may serve as a member of the Nevada Technology Council.

    Sec. 6.  1.  The account for the office of science, innovation and technology is hereby created in the state general fund. The account must be administered by the director of the office of science, innovation and technology.

    2.  Any money accepted pursuant to section 5 of this act must be deposited in the account.

    3.  The interest and income earned on the money in the account, after deducting any applicable charges, must be credited to the account.

    4.  The money in the account must only be used to carry out the duties of the director.

    5.  Claims against the account must be paid as other claims against the state are paid.

    Sec. 7.  NRS 284.140 is hereby amended to read as follows:

    284.140  The unclassified service of the state consists of positions held by state officers or employees in the executive department of the state government as follows:

    1.  Persons chosen by election or appointment to fill an elective office.

    2.  Members of boards and commissions, and heads of departments, agencies and institutions required by law to be appointed.


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ê2001 Statutes of Nevada, Page 2286 (Chapter 453, SB 401)ê

 

    3.  At the discretion of the elective officer or head of each department, agency or institution, one deputy and one chief assistant in each department, agency or institution.

    4.  Except as otherwise provided in section 3 of this act and NRS 223.085 and 223.570, all persons required by law to be appointed by the governor or heads of departments or agencies appointed by the governor or by boards.

    5.  All employees other than clerical in the office of the attorney general and the state public defender required by law to be appointed by the attorney general or the state public defender.

    6.  Except as otherwise provided by the board of regents of the University of Nevada pursuant to NRS 396.251, officers and members of the teaching staff and the staffs of the agricultural extension department and experiment station of the University and Community College System of Nevada, or any other state institution of learning, and student employees of these institutions. Custodial, clerical or maintenance employees of these institutions are in the classified service. The board of regents of the University of Nevada shall assist the director in carrying out the provisions of this chapter applicable to the University and Community College System of Nevada.

    7.  Officers and members of the Nevada National Guard.

    8.  Persons engaged in public work for the state but employed by contractors when the performance of the contract is authorized by the legislature or another competent authority.

    9.  Patient and inmate help in state charitable, penal, mental and correctional institutions.

    10.  Part-time professional personnel who are paid for any form of medical, nursing or other professional service and who are not engaged in the performance of administrative or substantially recurring duties.

    11.  All other officers and employees authorized by law to be employed in the unclassified service.

    Sec. 8.  NRS 396.798, 396.7982, 396.7984 and 396.7988 are hereby repealed.

    Sec. 9.  The state treasurer shall transfer any balance remaining unexpended on June 30, 2001, in the account for the office of science, engineering and technology to the account for the office of science, innovation and technology which is created by section 6 of this act.

    Sec. 10.  This act becomes effective on July 1, 2001.

________

 


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ê2001 Statutes of Nevada, Page 2287ê

 

CHAPTER 454, SB 466

Senate Bill No. 466–Committee on Government Affairs

 

CHAPTER 454

 

AN ACT relating to ethics in government; revising certain provisions regarding prohibited pecuniary interests and commitments of public officers and employees; specifying a period for the retention of certain documents filed with the commission on ethics; eliminating the requirement that certain public officials and judicial officers notify the commission in writing of their intent to use previously filed financial disclosure statements to fulfill certain other duties to file financial disclosure statements; providing a maximum civil penalty for failure to file financial disclosure statements in a timely manner; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 281.230 is hereby amended to read as follows:

    281.230  1.  Except as otherwise provided in this section and NRS 218.605, the following persons shall not, in any manner, directly or indirectly, receive any commission, personal profit or compensation of any kind resulting from any contract or other significant transaction in which the employing state, county, municipality, township, district or quasi-municipal corporation is in any way directly interested or affected:

    (a) State, county, municipal, district and township officers of the State of Nevada;

    (b) Deputies and employees of state, county, municipal, district and township officers; and

    (c) Officers and employees of quasi-municipal corporations.

    2.  A member of any board, commission or similar body who is engaged in the profession, occupation or business regulated by the board, commission or body may, in the ordinary course of his business, bid on or enter into a contract with any governmental agency, except the board or commission of which he is a member, if he has not taken part in developing the contract plans or specifications and he will not be personally involved in opening, considering or accepting offers.

    3.  A full- or part-time faculty member in the University and Community College System of Nevada may bid on or enter into a contract with a governmental agency if he has not taken part in developing the contract plans or specifications and he will not be personally involved in opening, considering or accepting offers.

    4.  A public officer or employee, other than an officer or employee described in subsection 2 or 3, may bid on or enter into a contract with a governmental agency if the contracting process is controlled by rules of open competitive bidding, the sources of supply are limited, he has not taken part in developing the contract plans or specifications and he will not be personally involved in opening, considering or accepting offers.

    5.  A person who violates any of the provisions of this section shall be punished as provided in NRS 197.230 and:

    (a) Where the commission, personal profit or compensation is $250 or more, for a category D felony as provided in NRS 193.130.


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ê2001 Statutes of Nevada, Page 2288 (Chapter 454, SB 466)ê

 

    (b) Where the commission, personal profit or compensation is less than $250, for a misdemeanor.

    6.  A person who violates the provisions of this section shall pay any commission, personal profit or compensation resulting from the contract or transaction to the employing state, county, municipality, township, district or quasi-municipal corporation as restitution.

    Sec. 2.  NRS 281.236 is hereby amended to read as follows:

    281.236  1.  A public utility or parent organization or subsidiary of a public utility shall not employ a former member of the public utilities commission of Nevada for 1 year after the termination of his service on the commission.

    2.  A person who holds a license issued pursuant to chapter 463 or 464 of NRS or who is required to register with the Nevada gaming commission pursuant to chapter 463 of NRS shall not employ a former member of the state gaming control board or the Nevada gaming commission for 1 year after the termination of the member’s service on the board or commission.

    3.  In addition to the prohibitions set forth in subsections 1 and 2, a business or industry whose activities are governed by regulations adopted by a department, division or other agency of the executive branch of government shall not, except as otherwise provided in subsection 4, employ a former public officer or employee of the agency, except a clerical employee, for 1 year after the termination of his service or period of employment if:

    (a) His principal duties included the formulation of policy contained in the regulations governing the business or industry;

    (b) During the immediately preceding year he directly performed activities, or controlled or influenced an audit, decision, investigation or other action, which significantly affected the business or industry which might, but for this section, employ him; or

    (c) As a result of his governmental service or employment, he possesses knowledge of the trade secrets of a direct business competitor.

    4.  A public officer or employee may request the commission on ethics to apply the relevant facts in his case to the provisions of subsection 3 and determine whether relief from the strict application of the provisions is proper. If the commission on ethics determines that relief from the strict application of the provisions of subsection 3 is not contrary to:

    (a) The best interests of the public;

    (b) The continued integrity of state government; and

    (c) The code of ethical standards prescribed in NRS 281.481,

it may issue an [order] opinion to that effect and grant such relief. The [decision] opinion of the commission on ethics in such a case is subject to judicial review.

    5.  As used in this section, “regulation” has the meaning ascribed to it in NRS 233B.038.

    Sec. 3.  NRS 281.4365 is hereby amended to read as follows:

    281.4365  1.  “Public officer” means a person elected or appointed to a position which is established by the constitution of the State of Nevada, a statute of this state or an ordinance of any of its counties or incorporated cities and which involves the exercise of a public power, trust or duty. As used in this section, “the exercise of a public power, trust or duty” [includes:] means:


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ê2001 Statutes of Nevada, Page 2289 (Chapter 454, SB 466)ê

 

    (a) Actions taken in an official capacity which involve a substantial and material exercise of administrative discretion in the formulation of public policy;

    (b) The expenditure of public money; and

    (c) The enforcement of laws and rules of the state, a county or a city.

    2.  “Public officer” does not include:

    (a) Any justice, judge or other officer of the court system;

    (b) Any member of a board, commission or other body whose function is advisory;

    (c) Any member of a board of trustees for a general improvement district or special district whose official duties do not include the formulation of a budget for the district or the authorization of the expenditure of the district’s money; or

    (d) A county health officer appointed pursuant to NRS 439.290.

    Sec. 4.  NRS 281.491 is hereby amended to read as follows:

    281.491  In addition to the requirements of the code of ethical standards:

    1.  A member of the executive branch or public employee of the executive branch shall not accept compensation from any private person to represent or counsel him on any issue pending before the agency in which that officer or employee serves, if the agency makes decisions. Any such officer or employee who leaves the service of the agency shall not, for 1 year after leaving the service of the agency, represent or counsel for compensation a private person upon any issue which was under consideration by the agency during his service. As used in this subsection, “issue” includes a case, proceeding, application, contract or determination, but does not include the proposal or consideration of legislative measures or administrative regulations.

    2.  A member of the legislative branch, or a member of the executive branch or public employee whose public service requires less than half of his time, may represent or counsel a private person before an agency in which he does not serve. Any other member of the executive branch or public employee shall not represent a client for compensation before any state agency of the executive or legislative branch of government.

    3.  Not later than January 10 of each year, any legislator or other public officer who has, within the preceding year, represented or counseled a private person for compensation before a state agency of the executive branch shall disclose for each such representation or counseling during the previous calendar year:

    (a) The name of the client;

    (b) The nature of the representation; and

    (c) The name of the state agency.

The disclosure must be made in writing and filed with the commission [.] , on a form prescribed by the commission. The commission shall retain a disclosure filed pursuant to this subsection for 6 years after the date on which the disclosure was filed.

    Sec. 5.  NRS 281.552 is hereby amended to read as follows:

    281.552  1.  Every public officer shall acknowledge that he has received, read and understands the statutory ethical standards. The acknowledgment must be on a form prescribed by the commission and must accompany the first statement of financial disclosure that the public officer is required to file with the commission pursuant to NRS 281.561.


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ê2001 Statutes of Nevada, Page 2290 (Chapter 454, SB 466)ê

 

    2.  The commission shall retain an acknowledgment filed pursuant to this section for 6 years after the date on which the acknowledgment was filed.

    3.  Willful refusal to execute and file the acknowledgment required by this section constitutes nonfeasance in office and is a ground for removal pursuant to NRS 283.440.

    Sec. 6.  NRS 281.561 is hereby amended to read as follows:

    281.561  1.  Except as otherwise provided in subsection 2 or 3, if a candidate for public or judicial office or a public or judicial officer is entitled to receive compensation for serving in the office in question, he shall file with the commission, and with the officer with whom declarations of candidacy for the office in question are filed, a statement of financial disclosure, as follows:

    (a) A candidate for nomination, election or reelection shall file a statement of financial disclosure no later than the 10th day after the last day to qualify as a candidate for the office.

    (b) A public or judicial officer appointed to fill the unexpired term of an elected public or judicial officer shall file a statement of financial disclosure within 30 days after his appointment.

    (c) Every public or judicial officer, whether appointed or elected, shall file a statement of financial disclosure on or before March 31 of each year of the term, including the year the term expires.

    (d) A public or judicial officer who leaves office on a date other than the expiration of his term or anniversary of his appointment or election, shall file a statement of financial disclosure within 60 days after leaving office.

    2.  A statement filed pursuant to one of the paragraphs of subsection 1 may be used to satisfy the requirements of another paragraph of subsection 1 if the initial statement was filed not more than 3 months before the other statement is required to be filed. [The public or judicial officer shall notify the commission in writing of his intention to use the previously filed statement to fulfill the present requirement.]

    3.  If a person is serving in a public or judicial office for which he is required to file a statement pursuant to subsection 1, he may use the statement he files for that initial office to satisfy the requirements of subsection 1 for every other public or judicial office in which he is also serving. [The person shall notify the commission in writing of his intention to use the statement for the initial office to fulfill the requirements of subsection 1 for every other office.]

    4.  A person may satisfy the requirements of subsection 1 by filing with the commission a copy of a statement of financial disclosure that was filed pursuant to the requirements of a specialized or local ethics committee if the form of the statement has been approved by the commission.

    Sec. 7.  NRS 281.581 is hereby amended to read as follows:

    281.581  1.  A candidate or public or judicial officer who fails to file his statement of financial disclosure in a timely manner pursuant to NRS 281.561 is subject to a civil penalty and payment of court costs and attorney’s fees. [The] Except as otherwise provided in subsection 3, the amount of the civil penalty is:

    (a) If the statement is filed not more than 7 days late, $25 for each day the statement is late.


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ê2001 Statutes of Nevada, Page 2291 (Chapter 454, SB 466)ê

 

    (b) If the statement is filed more than 7 days late but not more than 15 days late, $175 for the first 7 days, plus $50 for each additional day the statement is late.

    (c) If the statement is filed more than 15 days late, $575 for the first 15 days, plus $100 for each additional day the statement is late.

    2.  The commission may, for good cause shown, waive or reduce the civil penalty.

    3.  The civil penalty imposed for a violation of this section must not exceed the annual compensation for the office for which the statement was filed.

    4.  The civil penalty must be recovered in a civil action brought in the name of the State of Nevada by the commission in a court of competent jurisdiction and deposited with the state treasurer for credit to the state general fund.

    [4.] 5.  If the commission waives a civil penalty pursuant to subsection 2, the commission shall:

    (a) Create a record which sets forth that the civil penalty has been waived and describes the circumstances that constitute the good cause shown; and

    (b) Ensure that the record created pursuant to paragraph (a) is available for review by the general public.

    Sec. 8.  1.  This section and sections 1, 2 and 4 to 7, inclusive, of this act become effective on October 1, 2001.

    2.  Section 3 of this act becomes effective at 12:01 a.m. on October 1, 2001.

________

 

CHAPTER 455, SB 487

Senate Bill No. 487–Committee on Government Affairs

 

CHAPTER 455

 

AN ACT relating to public investments; authorizing additional types of investments for money in certain public funds; and providing other matters properly relating thereto.

 

[Approved: June 6, 2001]

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

    Section 1.  NRS 355.060 is hereby amended to read as follows:

    355.060  1.  The state controller shall notify the state treasurer monthly of the amount of uninvested money in the state permanent school fund.

    2.  Whenever there is a sufficient amount of money for investment in the state permanent school fund, the state treasurer shall proceed to negotiate for the investment of the money in:

    (a) United States bonds . [;]

    (b) Obligations or certificates of the Federal National Mortgage Association, the Federal Home Loan Banks, the Federal Home Loan Mortgage Corporation, the Federal Farm Credit Banks Funding Corporation or the Student Loan Marketing Association, whether or not guaranteed by the United States . [;]

    (c) Bonds of this state or of other states . [;]

    (d) Bonds of any county of the State of Nevada . [;]


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ê2001 Statutes of Nevada, Page 2292 (Chapter 455, SB 487)ê

 

    (e) United States treasury notes . [;]

    (f) Farm mortgage loans fully insured and guaranteed by the Farmers Home Administration of the United States Department of Agriculture . [;]

    (g) Loans at a rate of interest of not less than 6 percent per annum, secured by mortgage on agricultural lands in this state of not less than three times the value of the amount loaned, exclusive of perishable improvements, of unexceptional title and free from all encumbrances . [; or]

    (h) Money market mutual funds that:

         (1) Are registered with the Securities and Exchange Commission;

         (2) Are rated by a nationally recognized rating service as “AAA” or its equivalent; and

         (3) Invest only in securities issued or guaranteed as to payment of principal and interest by the Federal Government, or its agencies or instrumentalities, or in repurchase agreements that are fully collateralized by such securities.

    (i) Common or preferred stock of a corporation created by or existing under the laws of the United States or of a state, district or territory of the United States, if:

         (1) The stock of the corporation is:

             (I) Listed on a national stock exchange; or

             (II) Traded in the over-the-counter market, if the price quotations for the over-the-counter stock are quoted by the National Association of Securities Dealers Automated Quotations System (NASDAQ);

         (2) The outstanding shares of the corporation have a total market value of not less than $50,000,000;

         (3) The maximum investment in stock is not greater than 50 percent of the book value of the total investments of the state permanent school fund;

         (4) Except for investments made pursuant to paragraph (k), the amount of an investment in a single corporation is not greater than 3 percent of the book value of the assets of the state permanent school fund; and

         (5) Except for investments made pursuant to paragraph (k), the total amount of shares owned by the state permanent school fund is not greater than 5 percent of the outstanding stock of a single corporation.

    (j) A pooled or commingled real estate fund or a real estate security that is managed by a corporate trustee or by an investment advisory firm that is registered with the Securities and Exchange Commission, either of which may be retained by the state treasurer as an investment manager. The shares and the pooled or commingled fund must be held in trust. The total book value of an investment made under this paragraph must not at any time be greater than 5 percent of the total book value of all investments of the state permanent school fund.

    (k) Mutual funds or common trust funds that consist of any combination of the investments listed in paragraphs (a) to (j), inclusive.

    3.  The state treasurer shall not invest any money in the state permanent school fund pursuant to paragraph (i), (j) or (k) of subsection 2 unless the state treasurer obtains a judicial determination that the proposed investment or category of investments will not violate the provisions of section 9 of article 8 of the constitution of the State of Nevada. The state treasurer shall contract for the services of independent contractors to manage any investments of the state treasurer made pursuant to paragraph (i), (j) or (k) of subsection 2.


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ê2001 Statutes of Nevada, Page 2293 (Chapter 455, SB 487)ê

 

pursuant to paragraph (i), (j) or (k) of subsection 2. The state treasurer shall establish such criteria for the qualifications of such an independent contractor as are appropriate to ensure that each independent contractor has expertise in the management of such investments.

    4.  In addition to the investments authorized by subsection 2, the state treasurer may make loans of money from the state permanent school fund to school districts pursuant to NRS 387.526.

    [4.] 5.  No part of the state permanent school fund may be invested pursuant to a reverse-repurchase agreement.

    Sec. 2.  NRS 355.140 is hereby amended to read as follows:

    355.140  1.  In addition to other investments provided for by a specific statute, the following bonds and other securities are proper and lawful investments of any of the money of this state, of its various departments, institutions and agencies, and of the state insurance fund:

    (a) Bonds and certificates of the United States;

    (b) Bonds, notes, debentures and loans if they are underwritten by or their payment is guaranteed by the United States;

    (c) Obligations or certificates of the United States Postal Service, the Federal National Mortgage Association, the Government National Mortgage Association, the Federal Agricultural Mortgage Corporation, the Federal Home Loan Banks, the Federal Home Loan Mortgage Corporation or the Student Loan Marketing Association, whether or not guaranteed by the United States;

    (d) Bonds of this state or other states of the Union;

    (e) Bonds of any county of this state or of other states;

    (f) Bonds of incorporated cities in this state or in other states of the Union, including special assessment district bonds if those bonds provide that any deficiencies in the proceeds to pay the bonds are to be paid from the general fund of the incorporated city;

    (g) General obligation bonds of irrigation districts and drainage districts in this state which are liens upon the property within those districts, if the value of the property is found by the board or commission making the investments to render the bonds financially sound over all other obligations of the districts;

    (h) Bonds of school districts within this state;

    (i) Bonds of any general improvement district whose population is 200,000 or more and which is situated in two or more counties of this state or of any other state, if:

         (1) The bonds are general obligation bonds and constitute a lien upon the property within the district which is subject to taxation; and

         (2) That property is of an assessed valuation of not less than five times the amount of the bonded indebtedness of the district;

    (j) Medium-term obligations for counties, cities and school districts authorized pursuant to chapter 350 of NRS;

    (k) Loans bearing interest at a rate determined by the state board of finance when secured by first mortgages on agricultural lands in this state of not less than three times the value of the amount loaned, exclusive of perishable improvements, and of unexceptional title and free from all encumbrances;

    (l) Farm loan bonds, consolidated farm loan bonds, debentures, consolidated debentures and other obligations issued by federal land banks and federal intermediate credit banks under the authority of the Federal Farm Loan Act, formerly 12 U.S.C. §§ 636 to 1012, inclusive, and §§ 1021 to 1129, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive, and bonds, debentures, consolidated debentures and other obligations issued by banks for cooperatives under the authority of the Farm Credit Act of 1933, formerly 12 U.S.C. §§ 1131 to 1138e, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive, excluding such money thereof as has been received or which may be received hereafter from the Federal Government or received pursuant to some federal law which governs the investment thereof;


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ê2001 Statutes of Nevada, Page 2294 (Chapter 455, SB 487)ê

 

Loan Act, formerly 12 U.S.C. §§ 636 to 1012, inclusive, and §§ 1021 to 1129, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive, and bonds, debentures, consolidated debentures and other obligations issued by banks for cooperatives under the authority of the Farm Credit Act of 1933, formerly 12 U.S.C. §§ 1131 to 1138e, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive, excluding such money thereof as has been received or which may be received hereafter from the Federal Government or received pursuant to some federal law which governs the investment thereof;

    (m) Negotiable certificates of deposit issued by commercial banks, insured credit unions or savings and loan associations;

    (n) Bankers’ acceptances of the kind and maturities made eligible by law for rediscount with Federal Reserve banks or trust companies which are members of the Federal Reserve System, except that acceptances may not exceed 180 days’ maturity, and may not, in aggregate value, exceed 20 percent of the total par value of the portfolio as determined on the date of purchase;

    (o) Commercial paper issued by a corporation organized and operating in the United States or by a depository institution licensed by the United States or any state and operating in the United States that:

         (1) At the time of purchase has a remaining term to maturity of not more than 270 days; and

         (2) Is rated by a nationally recognized rating service as “A-1,” “P-1” or its equivalent, or better,

except that investments pursuant to this paragraph may not, in aggregate value, exceed 20 percent of the total par value of the portfolio as determined on the date of purchase, and if the rating of an obligation is reduced to a level that does not meet the requirements of this paragraph, it must be sold as soon as possible;

    (p) Notes, bonds and other unconditional obligations for the payment of money, except certificates of deposit that do not qualify pursuant to paragraph (m), issued by corporations organized and operating in the United States or by depository institutions licensed by the United States or any state and operating in the United States that:

         (1) Are purchased from a registered broker-dealer;

         (2) At the time of purchase have a remaining term to maturity of not more than 5 years; and

         (3) Are rated by a nationally recognized rating service as “A” or its equivalent, or better,

except that investments pursuant to this paragraph may not, in aggregate value, exceed 20 percent of the total par value of the portfolio, and if the rating of an obligation is reduced to a level that does not meet the requirements of this paragraph, it must be sold as soon as possible;

    (q) Money market mutual funds which:

         (1) Are registered with the Securities and Exchange Commission;

         (2) Are rated by a nationally recognized rating service as “AAA” or its equivalent; and

         (3) Invest only in securities issued by the Federal Government or agencies of the Federal Government or in repurchase agreements fully collateralized by such securities;

    (r) Collateralized mortgage obligations that are rated by a nationally recognized rating service as “AAA” or its equivalent; and


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ê2001 Statutes of Nevada, Page 2295 (Chapter 455, SB 487)ê

 

    (s) Asset-backed securities that are rated by a nationally recognized rating service as “AAA” or its equivalent.

    2.  Repurchase agreements are proper and lawful investments of money of the state and the state insurance fund for the purchase or sale of securities which are negotiable and of the types listed in subsection 1 if made in accordance with the following conditions:

    (a) The state treasurer shall designate in advance and thereafter maintain a list of qualified counterparties which:

         (1) Regularly provide audited and, if available, unaudited financial statements to the state treasurer;

         (2) The state treasurer has determined to have adequate capitalization and earnings and appropriate assets to be highly credit worthy; and

         (3) Have executed a written master repurchase agreement in a form satisfactory to the state treasurer and the state board of finance pursuant to which all repurchase agreements are entered into. The master repurchase agreement must require the prompt delivery to the state treasurer and the appointed custodian of written confirmations of all transactions conducted thereunder, and must be developed giving consideration to the Federal Bankruptcy Act, 11 U.S.C. §§ 101 et seq.

    (b) In all repurchase agreements:

         (1) At or before the time money to pay the purchase price is transferred, title to the purchased securities must be recorded in the name of the appointed custodian, or the purchased securities must be delivered with all appropriate, executed transfer instruments by physical delivery to the custodian;

         (2) The state must enter into a written contract with the custodian appointed pursuant to subparagraph (1) which requires the custodian to:

             (I) Disburse cash for repurchase agreements only upon receipt of the underlying securities;

             (II) Notify the state when the securities are marked to the market if the required margin on the agreement is not maintained;

             (III) Hold the securities separate from the assets of the custodian; and

             (IV) Report periodically to the state concerning the market value of the securities;

         (3) The market value of the purchased securities must exceed 102 percent of the repurchase price to be paid by the counterparty and the value of the purchased securities must be marked to the market weekly;

         (4) The date on which the securities are to be repurchased must not be more than 90 days after the date of purchase; and

         (5) The purchased securities must not have a term to maturity at the time of purchase in excess of 10 years.

    3.  As used in subsection 2:

    (a) “Counterparty” means a bank organized and operating or licensed to operate in the United States pursuant to federal or state law or a securities dealer which is:

         (1) A registered broker-dealer;

         (2) Designated by the Federal Reserve Bank of New York as a “primary” dealer in United States government securities; and

         (3) In full compliance with all applicable capital requirements.


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ê2001 Statutes of Nevada, Page 2296 (Chapter 455, SB 487)ê

 

    (b) “Repurchase agreement” means a purchase of securities by the state or state insurance fund from a counterparty which commits to repurchase those securities or securities of the same issuer, description, issue date and maturity on or before a specified date for a specified price.

    4.  No money of this state may be invested pursuant to a reverse-repurchase agreement, except money invested pursuant to chapter 286 of NRS.

    Sec. 3.  NRS 355.170 is hereby amended to read as follows:

    355.170  1.  Except as otherwise provided in this section, NRS 354.750 and section 1 of [this act,] Assembly Bill No. 96 of this session, a board of county commissioners, a board of trustees of a county school district or the governing body of an incorporated city may purchase for investment the following securities and no others:

    (a) Bonds and debentures of the United States, the maturity dates of which do not extend more than 10 years after the date of purchase.

    (b) Farm loan bonds, consolidated farm loan bonds, debentures, consolidated debentures and other obligations issued by federal land banks and federal intermediate credit banks under the authority of the Federal Farm Loan Act, formerly 12 U.S.C. §§ 636 to 1012, inclusive, and §§ 1021 to 1129, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive, and bonds, debentures, consolidated debentures and other obligations issued by banks for cooperatives under the authority of the Farm Credit Act of 1933, formerly 12 U.S.C. §§ 1131 to 1138e, inclusive, and the Farm Credit Act of 1971, 12 U.S.C. §§ 2001 to 2259, inclusive.

    (c) Bills and notes of the United States Treasury, the maturity date of which is not more than 10 years after the date of purchase.

    (d) Obligations of an agency or instrumentality of the United States of America or a corporation sponsored by the government, the maturity date of which is not more than 10 years after the date of purchase.

    (e) Negotiable certificates of deposit issued by commercial banks, insured credit unions or savings and loan associations.

    (f) Securities which have been expressly authorized as investments for local governments or agencies, as defined in NRS 354.474, by any provision of Nevada Revised Statutes or by any special law.

    (g) Nonnegotiable certificates of deposit issued by insured commercial banks, insured credit unions or insured savings and loan associations, except certificates that are not within the limits of insurance provided by an instrumentality of the United States, unless those certificates are collateralized in the same manner as is required for uninsured deposits by a county treasurer pursuant to NRS 356.133. For the purposes of this paragraph, any reference in NRS 356.133 to a “county treasurer” or “board of county commissioners” shall be deemed to refer to the appropriate financial officer or governing body of the county, school district or city purchasing the certificates.

    (h) Subject to the limitations contained in NRS 355.177, negotiable notes or short-time negotiable bonds issued by local governments of the State of Nevada pursuant to NRS 350.091.

    (i) Bankers’ acceptances of the kind and maturities made eligible by law for rediscount with Federal Reserve Banks, and generally accepted by banks or trust companies which are members of the Federal Reserve System. Eligible bankers’ acceptances may not exceed 180 days’ maturity. Purchases of bankers’ acceptances may not exceed 20 percent of the money available to a local government for investment as determined on the date of purchase.


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ê2001 Statutes of Nevada, Page 2297 (Chapter 455, SB 487)ê

 

of bankers’ acceptances may not exceed 20 percent of the money available to a local government for investment as determined on the date of purchase.

    (j) Obligations of state and local governments if:

         (1) The interest on the obligation is exempt from gross income for federal income tax purposes; and

         (2) The obligation has been rated “A” or higher by one or more nationally recognized bond credit rating agencies.

    (k) Commercial paper issued by a corporation organized and operating in the United States or by a depository institution licensed by the United States or any state and operating in the United States that:

         (1) Is purchased from a registered broker-dealer;

         (2) At the time of purchase has a remaining term to maturity of no more than 270 days; and

         (3) Is rated by a nationally recognized rating service as “A-1,” “P-1” or its equivalent, or better,

except that investments pursuant to this paragraph may not, in aggregate value, exceed 20 percent of the total portfolio as determined on the date of purchase, and if the rating of an obligation is reduced to a level that does not meet the requirements of this paragraph, it must be sold as soon as possible.

    (l) Money market mutual funds which:

         (1) Are registered with the Securities and Exchange Commission;

         (2) Are rated by a nationally recognized rating service as “AAA” or its equivalent; and

         (3) Invest only in:

             (I) Securities issued by the Federal Government or agencies of the Federal Government;

             (II) Master notes, bank notes or other short-term commercial paper rated by a nationally recognized rating service as “A-1,” “P-1” or its equivalent, or better, issued by a corporation organized and operating in the United States or by a depository institution licensed by the United States or any state and operating in the United States; or

             (III) Repurchase agreements that are fully collateralized by the obligations described in sub-subparagraphs (I) and (II).

    (m) Obligations of the Federal Agricultural Mortgage Corporation.

    2.  Repurchase agreements are proper and lawful investments of money of a board of county commissioners, a board of trustees of a county school district or a governing body of an incorporated city for the purchase or sale of securities which are negotiable and of the types listed in subsection 1 if made in accordance with the following conditions:

    (a) The board of county commissioners, the board of trustees of the school district or the governing body of the city shall designate in advance and thereafter maintain a list of qualified counterparties which:

         (1) Regularly provide audited and, if available, unaudited financial statements;

         (2) The board of county commissioners, the board of trustees of the school district or the governing body of the city has determined to have adequate capitalization and earnings and appropriate assets to be highly credit worthy; and

         (3) Have executed a written master repurchase agreement in a form satisfactory to the board of county commissioners, the board of trustees of the school district or the governing body of the city pursuant to which all repurchase agreements are entered into. The master repurchase agreement must require the prompt delivery to the board of county commissioners, the board of trustees of the school district or the governing body of the city and the appointed custodian of written confirmations of all transactions conducted thereunder, and must be developed giving consideration to the Federal Bankruptcy Act.


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ê2001 Statutes of Nevada, Page 2298 (Chapter 455, SB 487)ê

 

must require the prompt delivery to the board of county commissioners, the board of trustees of the school district or the governing body of the city and the appointed custodian of written confirmations of all transactions conducted thereunder, and must be developed giving consideration to the Federal Bankruptcy Act.

    (b) In all repurchase agreements:

         (1) At or before the time money to pay the purchase price is transferred, title to the purchased securities must be recorded in the name of the appointed custodian, or the purchased securities must be delivered with all appropriate, executed transfer instruments by physical delivery to the custodian;

         (2) The board of county commissioners, the board of trustees of the school district or the governing body of the city must enter a written contract with the custodian appointed pursuant to subparagraph (1) which requires the custodian to:

             (I) Disburse cash for repurchase agreements only upon receipt of the underlying securities;

             (II) Notify the board of county commissioners, the board of trustees of the school district or the governing body of the city when the securities are marked to the market if the required margin on the agreement is not maintained;

             (III) Hold the securities separate from the assets of the custodian; and

             (IV) Report periodically to the board of county commissioners, the board of trustees of the school district or the governing body of the city concerning the market value of the securities;

         (3) The market value of the purchased securities must exceed 102 percent of the repurchase price to be paid by the counterparty and the value of the purchased securities must be marked to the market weekly;

         (4) The date on which the securities are to be repurchased must not be more than 90 days after the date of purchase; and

         (5) The purchased securities must not have a term to maturity at the time of purchase in excess of 10 years.

    3.  The securities described in paragraphs (a), (b) and (c) of subsection 1 and the repurchase agreements described in subsection 2 may be purchased when, in the opinion of the board of county commissioners, the board of trustees of a county school district or the governing body of the city, there is sufficient money in any fund of the county, the school district or city to purchase those securities and the purchase will not result in the impairment of the fund for the purposes for which it was created.

    4.  When the board of county commissioners, the board of trustees of a county school district or governing body of the city has determined that there is available money in any fund or funds for the purchase of bonds as set out in subsection 1 or 2, those purchases may be made and the bonds paid for out of any one or more of the funds, but the bonds must be credited to the funds in the amounts purchased, and the money received from the redemption of the bonds, as and when redeemed, must go back into the fund or funds from which the purchase money was taken originally.

    5.  Any interest earned on money invested pursuant to subsection 3, may, at the discretion of the board of county commissioners, the board of trustees of a county school district or governing body of the city, be credited to the fund from which the principal was taken or to the general fund of the county, school district or incorporated city.


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ê2001 Statutes of Nevada, Page 2299 (Chapter 455, SB 487)ê

 

fund from which the principal was taken or to the general fund of the county, school district or incorporated city.

    6.  The board of county commissioners, the board of trustees of a county school district or governing body of an incorporated city may invest any money apportioned into funds and not invested pursuant to subsection 3 and any money not apportioned into funds in bills and notes of the United States Treasury, the maturity date of which is not more than 1 year after the date of investment. These investments must be considered as cash for accounting purposes, and all the interest earned on them must be credited to the general fund of the county, school district or incorporated city.

    7.  This section does not authorize the investment of money administered pursuant to a contract, debenture agreement or grant in a manner not authorized by the terms of the contract, agreement or grant.

    8.  As used in this section:

    (a) “Counterparty” means a bank organized and operating or licensed to operate in the United States pursuant to federal or state law or a securities dealer which is:

         (1) A registered broker-dealer;

         (2) Designated by the Federal Reserve Bank of New York as a “primary” dealer in United States government securities; and

         (3) In full compliance with all applicable capital requirements.

    (b) “Repurchase agreement” means a purchase of securities by a board of county commissioners, the board of trustees of a county school district or the governing body of an incorporated city from a counterparty which commits to repurchase those securities or securities of the same issuer, description, issue date and maturity on or before a specified date for a specified price.

    Sec. 4.  NRS 396.926 is hereby amended to read as follows:

    396.926  1.  The millennium scholarship trust fund is hereby created in the state treasury. The state treasurer may accept gifts, grants, bequests and donations for deposit in the trust fund.

    2.  The state treasurer shall deposit in the trust fund:

    (a) Forty percent of all money received by the State of Nevada pursuant to any settlement entered into by the State of Nevada and a manufacturer of tobacco products;

    (b) Forty percent of all money recovered by the State of Nevada from a judgment in a civil action against a manufacturer of tobacco products; and

    (c) Any gifts, grants, bequests or donations specifically designated for the trust fund by the donor.

    3.  The state treasurer shall administer the trust fund. As administrator of the trust fund, the state treasurer [:] , except as otherwise provided in this section:

    (a) Shall maintain the financial records of the trust fund;

    (b) Shall invest the money in the trust fund as the money in other state funds is invested;

    (c) Shall manage any account associated with the trust fund;

    (d) Shall maintain any instruments that evidence investments made with the money in the trust fund;

    (e) May contract with vendors for any good or service that is necessary to carry out the provisions of this section; and

    (f) May perform any other duties necessary to administer the trust fund.


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ê2001 Statutes of Nevada, Page 2300 (Chapter 455, SB 487)ê

 

    4.  In addition to the investments authorized pursuant to paragraph (b) of subsection 3, the state treasurer may, except as otherwise provided in subsection 5, invest the money in the trust fund in:

    (a) Common or preferred stock of a corporation created by or existing under the laws of the United States or of a state, district or territory of the United States, if:

         (1) The stock of the corporation is:

             (I) Listed on a national stock exchange; or

             (II) Traded in the over-the-counter market, if the price quotations for the over-the-counter stock are quoted by the National Association of Securities Dealers Automated Quotations System (NASDAQ);

         (2) The outstanding shares of the corporation have a total market value of not less than $50,000,000;

         (3) The maximum investment in stock is not greater than 25 percent of the book value of the total investments of the trust fund;

         (4) Except for investments made pursuant to paragraph (c), the amount of an investment in a single corporation is not greater than 3 percent of the book value of the assets of the trust fund; and

         (5) Except for investments made pursuant to paragraph (c), the total amount of shares owned by the trust fund is not greater than 5 percent of the outstanding stock of a single corporation.

    (b) A pooled or commingled real estate fund or a real estate security that is managed by a corporate trustee or by an investment advisory firm that is registered with the Securities and Exchange Commission, either of which may be retained by the state treasurer as an investment manager. The shares and the pooled or commingled fund must be held in trust. The total book value of an investment made under this paragraph must not at any time be greater than 5 percent of the total book value of all investments of the trust fund.

    (c) Mutual funds or common trust funds that consist of any combination of the investments authorized pursuant to paragraph (b) of subsection 3 and paragraphs (a) and (b) of this subsection.

    5.  The state treasurer shall not invest any money in the trust fund pursuant to subsection 4 unless the state treasurer obtains a judicial determination that the proposed investment or category of investments will not violate the provisions of section 9 of article 8 of the constitution of the State of Nevada. The state treasurer shall contract for the services of independent contractors to manage any investments of the state treasurer made pursuant to subsection 4. The state treasurer shall establish such criteria for the qualifications of such an independent contractor as are appropriate to ensure that each independent contractor has expertise in the management of such investments.

    6.  All interest and income earned on the money in the trust fund must, after deducting any applicable charges, be credited to the trust fund. All claims against the trust fund must be paid as other claims against the state are paid.

    [5.] 7.  Not more than 2 percent of the amount of money in the trust fund may be used to pay the costs of administering the trust fund.

    [6.] 8.  The money in the trust fund remains in the fund and does not revert to the state general fund at the end of any fiscal year.

    [7.] 9.  Money in the trust fund may be used only for the purposes set forth in NRS 396.914 to 396.934, inclusive.


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ê2001 Statutes of Nevada, Page 2301 (Chapter 455, SB 487)ê

 

    Sec. 5.  NRS 439.605 is hereby amended to read as follows:

    439.605  1.  The trust fund for public health is hereby created in the st