Formally recognized by the Nevada State Legislature in 1959¹, and as previously documented, GIDs are “political subdivisions” of the State². That is, “body corporate(s)…politic and…quasi-municipal corporation(s).”³ The arguable reason for their formation was not to create a slew of new “supplemental” local governments, each capable of exercising general municipal type police powers⁴, with the intent of “supplant(ing) the (similar) authority of…(true) general-purpose governments.”⁵ But rather, “to provide various urban type services (to real property⁶) in…areas where such services were not available and could not or would not be provided by general-purpose government(s).”⁷ Initially those services were encompassed within the five (5) limited sets of powers defined below:

1. “In the case of a district created wholly or in part for acquiring paving, (GID) board(s)…ha(d) the power to grade and regrade and to surface and to resurface streets, alleys and public highways, and parts thereof, within the district…and to acquire street and alley improvements necessary and incidental thereto;”⁸

2. “In the case of a district created wholly or in part for acquiring curb and gutter, (GID) board(s)…ha(d) the power to improve streets…by grading and regrading and by the construction and reconstruction of curb, gutter and combined curb and gutter, in combination with sidewalk or otherwise, and to acquire improvements necessary and incidental to the foregoing improvements, including, without limiting the generality thereof, drains, catch basins, valley gutters, driveway inlets and the removal of existing improvements;”⁹

3. “In the case of a district created wholly or in part for acquiring sidewalk(s),(GID) board(s)…ha(d) the power to construct, reconstruct, replace or extend sidewalks, adjacent to or in combination with curb and gutter or otherwise, within the district, and to acquire improvements necessary and incidental thereto;”¹⁰

4. “In the case of a district created wholly or in part for acquiring storm drainage improvements,(GID) board(s)…ha(d) the power to construct, reconstruct, replace or extend storm sewer and other drainage facilities and improvements necessary and incidental thereto within the district, including, without limiting the generality of the foregoing, the laying of pipes and the erection of catch basins, drains and necessary inlets and outlets;”¹¹ and,

5. “In the case of a district created wholly or in part for acquiring sanitary sewer improvements, (GID) board(s)…ha(d) the power: (1) to construct, reconstruct, improve, extend or better the sanitary sewer system or any part thereof, including, without limiting the generality of the foregoing, mains, laterals, wyes, tees, meters and collection, treatment and disposal plants;” and, (2) to sell any product or byproduct thereof and to acquire the appropriate outlets within or without the district and to extend the sewer lines of the district thereto.”¹²

In the very beginning, “there were no criteria to guide…(county Board) commissioners as to whether…a (GID) should be created” and if so, what basic powers it should be authorized to exercise¹³. Although that changed “in 1965 (when)…requirement(s) w(ere) added (to NRS 318) that…(1) public convenience and necessity require(d their) creation…and that (2) creation (be) economically sound and feasible,”¹⁴ they00000000 were not applied retroactively to the “many existing districts (like IVGID)…created prior to…passage of”¹⁵ said legislation. Thus today, “there have been a number of districts created that are not financially sound, (and)…performing services that should be provided by counties¹⁶…Two basic reasons account for this (phenomena).

First, many existing districts were created prior to…passage of the Special District Control Law.”¹⁷ As aforesaid, before 1967 county commissioners had very little guidance on when and where (GIDs) should be created. And second, there was an exception in the “Special District Control Law”¹⁸ to the service plan requirement for districts initiated by county commissioners (as opposed to those initiated by private individuals or groups). This exception (which IVGID took advantage of) has led, on a number of occasions, to”¹⁹ at least two (2) unintended consequences. First, “proposal of a district by a board of county commissioners when, in fact, the district (i)s initiated by local residents or a developer. (Thus)…when approached by citizens requesting a service from the county, (commissioners) often suggest that a (GID), which they will be willing to create, is the only way to provide the requested service. (Notwithstanding) such districts often do not have the adequate size (n)or tax base to support the (requested) service…county commissioners have (effectively) transferred…demand…from the county to the district.”²⁰

And second, even though the former NRS 308.020(2)(c) exception (referenced above²⁰) has been rescinded²¹, even today, there is no requirement a County Board find that public convenience and necessity require continuation of existing GIDs. Nor that they can be compelled to operate economically soundly and feasibly.

But today, their time has come and gone. We see this in NRS 308.010(3) which instructs that “the purpose of (today’s) Special District Control Law (is)…to encourage the extension of existing districts rather than the creation of new districts…to prevent (the) unnecessary proliferation and fragmentation of local government…and to avoid excessive diffusion of local tax sources.” As borne out by pages 9 and 17-18 of LCB Bulletin 77-11‘s which questioned whether “chapter 318 of NRS should be retained at all, a generalized problem identified very early…(on wa)s the absence of authority for boards of county commissioners to oversee the operation of general improvement districts. This absence of authority le(d) to a number of…specific problems” such as the creation of “a number of districts…performing services that should be provided by counties or that have been created in close proximity to existing districts providing the same or similar services…(or) that (we)re not financially sound.” IVGID being a prime example. But today we have the problem forewarned. “Once…in existence, GIDs are independent legal entities with their own perpetual existence (see NRS 318.105).”¹⁹ Having served their useful purposes, what do we do with them now?

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1. See page 457 of Chapter 319, SB 20, 1959 Statutes of Nevada.
2. According to NRS 281A.145, “any county, city or other local government as defined in NRS 354.474.” In other words, every “entity which has the right to levy or receive money from ad valorem or other taxes or any mandatory assessments, and (expressly) including…counties, cities, towns, boards, school districts and other districts [like the Incline Village General Improvement District (“IVGID”)] organized pursuant to chapter…318…of NRS” {see NRS 354.474(1)(a)}].
3. See NRS 318.075(1).
4. See https://www.ca-ilg.org/sites/main/files/file-attachments/local_agency_powers_and_limitations.pdf). In other words, those providing general governmental (health, safety and welfare) services (see https://www.census.gov/newsroom/cspan/govts/20120301_cspan_govts_def_3.pdf).
5. See https://canons.sog.unc.edu/special-purpose-local-governments-and-public-authorities/ (i.e., the counties which created them)
6. See footnote 8 under our discussion of What is a GID?
7. See ¶II at page 8 of Legislative Commission of the Legislative Counsel Bureau, State of Nevada (“LCB”), Bulletin No. 77-11, Creation, Financing and Governance of General Improvement Districts, September 1976 (“LCB Bulletin 77-11“).
8. See Sec. 23 at page 462, Chapter 319, SB 20, 1959 Statutes of Nevada.
9. See Sec. 24 at page 462, Chapter 319, SB 20, 1959 Statutes of Nevada.
10. See Sec. 25 at page 462, Chapter 319, SB 20, 1959 Statutes of Nevada.
11. See Sec. 26 at pages 462-463, Chapter 319, SB 20, 1959 Statutes of Nevada.
12. See Sec. 27 at page 463, Chapter 319, SB 20, 1959 Statutes of Nevada.
13. Although initially, the only basic powers which could be granted to a GID were “for paving, curb and gutters, sidewalks, storm drainage and sanitary sewer improvements within the district.”
14. See NRS 318.055(4)(c)(1)-(2).
15. See ¶II, at pages 8-9 of LCB Bulletin 77-11.
16. One of them in our opinion being IVGID.
17. See NRS 308.010(1).
18. See paragraph (c) of subsection 2 of former NRS 308.020 (see page 518 of Chapter 292, AB 163, 1977 Statutes of Nevada).
19. See pages 9-10 of LCB Bulletin 77-11.
20. See paragraph 2 of former NRS 308.020 (page 1681 of Chapter 542, SB 408, 1967 Statutes of Nevada).
21. Also see that August 21, 2015 memorandum from Paul Lipparelli, former Washoe County Assistant District Attorney, regarding the Legal Authority of General Improvement Districts in Nevada.