Stripped down superpad development bill passes Senate Government Affairs: a study in corporate influence

by Brian Bahouth

Residential development, entirely dependent on automobiles, has expanded well-beyond Reno's urban core - image - Brian Bahouth/the Ally

Carson City – The original version of Senate Bill 327 was long and apparently unnecessarily detailed. An amendment effectively removed the bill’s language and replaced it with a few paragraphs that revise a subsection of the laws by which subdivisions are created in Nevada, and the amended version of the bill passed the Senate Government affairs committee unanimously on Friday, the deadline day for original committee passage. As written, the measure would enable municipalities across the state to approve massive development projects like Anthem, Inspirada, and Summerlin in southern Nevada using what is known as a “superpad” model of development.

In a broad sense, the “super pad” scheme allows a developer to sell village-sized properties to builders in one transaction, and the “super pad” will eventually be subdivided into individual home lots.

At roughly 8:45 p.m. on the evening of April 9, Aaron West, CEO of the Nevada Builders Alliance presented SB327 to the Senate Government Affairs committee. The bill’s primary sponsor  Senator Ben Kieckhefer was absent.

Hear Aaron West’s presentation of SB327 to the Senate Government Affairs committee on Tuesday April 9, 2019.

“This actually pertains to a subset, 278a, which has to do very specifically with planned unit developments, which tend to be larger master-planned communities,” West said. “What we found in the research is that because this hasn’t been addressed specifically in statute, each community is kind of left to their own devices to try and come up with a process to get to what it is that we’re seeking.”

Mr. West said approval of the bill would help address the workforce housing shortage in the region, though the Anthem development in southern Nevada which Mr. West used as an example of what this bill enables is home to the state’s highest average income level as a ZIP Code, so whether this measure would enable the construction of affordable, environmentally sustainable workforce housing or high-end sprawl is a matter of debate.

“This session we’ve been hearing about the importance of workforce housing, and while there is certainly a lot of proposals this session to address that from a regulatory perspective, as an industry we believe and will continue to contend that we have a supply problem, and that is leading to excessive demand and leading to escalations in pricing and so forth, so the purpose of SB327 is as an enabling tool as it’s related to the development of master-planned communities. Again, this is enabling legislation,” West told lawmakers.

Mr. West said during the 2008 recession, home construction in Nevada came to a standstill, and, “the thought of future development was in question.”

“As we have been able to celebrate many economic development wins, and we see our communities growing now. We’re finding that we are woefully behind in the creation of lots for residential development,” West said. “While this wouldn’t impact any of the projects currently approved, based on how its drafted, would provide an opportunity for projects going forward, so Senate Bill 327 is a mechanism should local governments choose to adopt it to improve on a duplicative process as it relates to master planned development. With the adoption of the language, there is a potential cost saving to home buyers, as the homes are able to enter the market sooner.”

Critics contend the superpad model allows for too much development to be approved at one time lacking the details needed to accurately assess environmental impact, and thereby, the superpad model circumvents the public review process when meaningful details are sorted out. During the hearing late on Tuesday evening, West said he wanted to ensure lawmakers knew the bill was not intended to skirt the public input process regarding the permitting of master planned communities.

“There still are several necessary, transparent steps for developers to go through for the required process, so we want to make it very clear at no point are we trying to remove the public process from this development tool, but it allows us to do it a little more efficiently and hopefully bring more lots or the ability to get that scrutiny underway  and bring these lots to market.”

Near the end of his presentation comments to the committee, Mr. West outlined the essential goals of the legislation.

“Essentially, here’s the goal. In a large project of the scale that we’re talking, what ends up happening, multiple villages are envisioned within a development. It’s not a single subdivision. It’s typically multiple villages that comprise different product types and so forth. The idea is, different builders would take control of a village and build out that village.

“What we’re attempting to do is create the framework for those villages in a little bit simpler process, such that the merchant builders can then take that village and take it through a separate and distinct tentative map process, so that we could have, instead of the master developer having to go through a tentative map process, and when he completes that one and then go through another tentative map process, and taking a linear function. What we’re trying to do is create the villages in an earlier stage.”

And creating these villages in an earlier stage is one of the primary criticisms levied in the Toiyabe Chapter of the Sierra Club’s letter of opposition.  From the letter:

First, this bill would allow mass grading of landscapes, and if the specific development does not proceed in a timely fashion that will lead to negative environmental impacts such as water/soil runoff and visual eyesores with no definite timeline for any development to infill the area.

Second, SB 327 allows for development approvals to be done administratively rather than through an open and public process, where the issues and impacts can be fully vetted through a collaborative approach and including interested and concerned citizens.

The desired mechanism

Currently, according to Nevada law, parcel maps are limited to four lots or fewer.

“What we would do specifically within 278a, so again, this is only as it relates to PUDs (Planned Unit Developments), as it goes through the process, the local jurisdiction would have the ability to work this into the PUD handbook that a parcel map could be brought forward creating more than four parcels,” West told lawmakers.

Testimony in support

Vidler Water Company spokesperson Steve Hartman spoke in support of the bill. Hear Mr Hartman’s comments to the Senate Government Affairs committee.

Conflict of interest?

SB327 primary sponsor Senator Ben Kieckhefer is a Republican who represents Nevada’s Senate District 16, which includes Carson City and part of Washoe County. Kieckhefer is also the director of client relations for one of Nevada’s more heavily resourced law and lobbying firms, McDonald Carano.

The McDonald Carano website outlines what a government relations client can expect from the firm.

McDonald Carano’s Government Affairs & Advocacy (GAA) team works collaboratively with clients to identify and meet their policy and business goals in the legislative and regulatory environments.  We combine the skills of attorneys and traditional lobbyists with extensive governmental experience in both the private and public sectors. Our GAA team is known for its extensive network of relationships. We leverage our knowledge, influence, and relationships to craft impactful solutions for clients doing business in Nevada, and who are subject to the laws and regulations of federal agencies, the Nevada Legislature, state regulatory agencies, and city and county authorities.

Reno Gazette Journal writer Robert DeHaven recently detailed the ways in which SB327 may benefit a McDonald Carano client in building a development north of Reno called Stonegate, but Senator Kieckhefer is on record saying the Stonegate development is already approved and that SB327 would have no effect on the project.

Is it a conflict of interest that a seated Nevada senator also works for one of the leading lobbying firms?

The National Conference of State Legislators offers a detailed review of each state’s conflict of interest laws, and Nevada law is vague and sets out a conflict of interest as defined in Nev. Rev. Stat. Ann. § 281A.420

A conflict of interest may exist when a reasonable person in the public officer’s situation would lack independence of judgment regarding a matter due to: the public officer’s acceptance of a gift or loan; a significant pecuniary interest; or the public officer’s commitment in a private capacity to the interests of another person.

The McDonald Carano client list is not public record, but an Associated Press report indicates Senator Kieckhefer has voted for McDonald Carano clients on several occasions.

Campaign contributions from those who might benefit from the passage of SB327

For some context on the unanimous passage by the Senate Committee on Government Relations of SB327, we looked to campaign contribution records of every member of the committee for industries or organizations that might benefit from the passage of SB327. The data reflects campaign contributions for the latest campaign, and repeated contributions by a single donor have been consolidated. 

Senator David Parks – chairman of Senate Government Affairs – 

Cashman Equipment – $2,000.00
Nevada Realtors PAC $7,000.00
So. Nevada Building & Construction Trades PAC $500.00
Plumbers & Pipefitters 525 $500.00
Southern Nevada Building & Construction Trades Council $1,000.00
Nevada Home Builders Association – PAC $1,000.00
Total for David Parks – $12,000.00

Senator Melanie Schible – 

Southwest Regional Council of Carpenters Political Action Funds $750.00
Southern Nevada Building and Construction Trades Political Action Fund $1,500.00
KAG Property LLC, commercial real estate investors – $1,000.00
Olympia Properties, LLC $500.00
Southern Highlands Investment Partners $1,000.00
Nevada Home Builders Association PAC $5,000.00
Nevada Realtors PAC $3,000.00
Total for Melanie Schible – $12,750.00

Senator James Ohrenschall –  

Nevada Realtors PAC $5,000.00
Construction Industry Committee $750.00
Las Vegas Paving Corp $2,000.00
Political Action Committee 525, plumbers and pipefitters $5,000.00
Southwest Regional Council of Carpenters $4,500.00
Southern Nevada Building and Construction Trades $1,500.00
Nevada Home Builders Association PAC $1,000.00
Associate General Contractors $500.00
KAG Property LLC, commercial real estate investors – $400.00
Olympia Properties, LLC $200.00
Southern Highlands Investment Partners $400.00
Nevada Subcontractors $1,500.00
Total for James Ohrenschall – $22,750.00

Senator Ben Kieckhefer – 

Granite Construction Company $1,000.00
Nevada Home Builders Association PAC $7,500.00
Associated General Contractors $1,000.00
Nevada Builders Alliance $1,000.00
Associated Builders and Contractors $1,000.00
Reno Land Inc. $1,000.00
KAG Property LLC, commercial real estate investors – $600.00
Southern Highlands Investment Partners $600.00
Nevada Subcontractors $5,000.00
Nevada Realtors PAC $3,000.00
Nevada Bankers Association $1,000.00
SR Construction $1,000.00
Total for Ben Kieckhefer – $23,700 plus $5,000.00 from his employer McDonald Carano – $28,700.00

Senator Pete Goicoechea – 

Nevada Home Builders Assoc. $6,000.00
Associated General Contractors $1,000.00
Nevada Builders Alliance $2,000.00
Total for Pete Goicoechea – $9,000.00