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Assuming Arguendo The District’s Recreation (“RFF”) and Beach (“BFF”) Facility “Fees” Are Actually “Fees,” Are They The NRS 318.197(1) “Service And Standby Service Charges” Staff And Past Boards Represent/Have Represented?

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The simple answer to the question is no they are not. And here are the reasons why not.

Listen to What Staff/Past Boards of Trustees (“Boards“) Tell/Have Told Us The RFF/BFF Pay For:

“Standby And Service Charges (For)…The Availability of The Use of IVGID‘s Beaches” And Other Delineated Public Recreation Facilities: As we’ve demonstrated elsewhere, “each year, the District establishes…annual Recreation…and Beach Facility Fee(s)…collected from property owners within the District through a levy placed on the(ir) property tax bill(s)1…As part of the annual budget process, the Board traditionally approves a resolution which outlines the billing2 (see NRS 318.197) and collection3 (see NRS 318.201) process(es) set forth in (the) Nevada Revised Statutes…which establish…the amount of the…RFF and…BFF to be collected,” and elects to have such charges collected on the county tax roll4. “At (a publicly noticed) meeting the Board…t(akes) action (via resolution5)…which…(approves a final Report6 contain(ing) a description of each parcel of real property receiving…services and facilities (from the District, and) the (final) amount of…charge(s)…for such year.”7

The resolution referenced above describes the RFF/BFF as “standby and service charges8 (for)…the availability of the use of IVGID’s beaches” and other delineated public recreation facilities9. In other words, “IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and (the) Recreation Center.”10

Up to Five Picture Passes (“PPHs“) And/Or Punch Cards: But that’s not the District’s only admission. Staff tell us the RFF/BFF pay for up to five: PPHs11 similar to Costco, Sam’s Club or now Best Buy Plus12, or punch cards13. For years staff used to accompany the District’s final budget with a letter addressed, in part, to we “Citizens of Incline Village and Crystal Bay.”14 The letter, in part, expressly answered the question: “What Privileges…Parcel Owners Get For Paying…Facility Fees.” Let us quote from page 16 of the letter accompanying the 2018-19 Budget:

“Each eligible parcel that pays the RFF can have five (5) cards issued in the form of picture passes…and/or punch cards…or a combination of both. The Picture Passholder gets preferred pricing and/or preferred access to the District’s major (recreation) venues or programming…A Punch Card Holder receives the opportunity, at designated (recreation) venues, to reduce their user fees from the (retail) rack rate to the (preferred) PPH rate.”

Nonetheless, There‘s No Such Fee Recognized by NRS 318.197(1) as a “Standby And Service Charge (For)…The Availability of The Use of IVGID‘s Beaches” And Other Delineated Public Recreation Facilities: Where Does NRS 318.197 Recognize “Charges For The Availability of Service?” Read NRS 318.197(1) carefully: “The board may fix, and from time to time increase or decrease…charges for the availability of service.” Okay. But what about charges for the availability of facilities? After all, staff and past Boards have told us15 the RFF and BFF represent charges “for the availability of use of the recreational facilities (therein) described.”16 Nowhere is a recreational facility availability of use charge recognized.

But What About The Fact NRS 318.197(1) Recognizes Other Kinds of Rates, Tolls, And Charges Other Than Those Expressly Mentioned? Stated differently, given NRS 318.197 states that “the board may fix, and from time to time increase or decrease…rates, tolls or charges…including, but not limited to…charges for the availability of service,” can a “charge for the availability of” facilities be included therein? To answer this question, we examine the rules of statutory construction.

The interpretation of a statute begins with its literal words17. Where as here the language is plain and unambiguous on its face, it is inappropriate to resort to any ancillary construction aids18. Therefore, this rule limits a court from ignoring parts of a statute in order to reach a more reasonable construction. Or “to insert words…the Court believes the legislature left out, be it intentionally or inadvertently.”19

Expressio Unius Est Exclusio Alterius: Moreover, Nevada recognizes the rule of expressio unius est exclusio alterius20. This rule states that “where a…statute specifies certain things, the designation of such things excludes all others.”21 Here “the Court may not, through judicial fiat, second-guess the legislature and decide, sua sponte, that public policy would be better served by” inferring the power to fix a type of charge not expressly stated. “In the absence of clear legislative intent, considerations of public policy must be declared by the legislature and not the Court.” Therefore, “if the glove doesn’t fit, you must acquit!”22

Moreover, There‘s Dillon‘s Rule: which instructs “that (a)…governing body…possesses and may exercise only the following powers and no others: (a) those…granted in express terms by the Nevada Constitution, statute or…charter; (b) those…necessarily or fairly implied in or incident to the powers expressly granted23; and, (c) those…(absolutely) essential to the accomplishment of the declared objects and purposes of the (local governing body at issue) and not merely convenient but indispensable.”24 And “if there (be) any fair or reasonable doubt concerning the existence of a power, that doubt is (to be) resolved against the governing body…and the power (be) denied.”25

Given the express words of NRS 318.197 fail to recognize a charge for the availability of facilities, it does not exist. And “if there (be) any fair or reasonable doubt concerning the existence of (such) a power, (here) that doubt is (to be) resolved against (IVGID)…and the power (be) denied.” Notwithstanding all of the above,

County Boards Were Not Given The Power to Grant The GIDs They Created/Had Created The Basic Power to Furnish Facilities For Public Recreation Until 1965: Although the GID Law26 was enacted in 195927, County Boards of Commissioners (“County Boards”) were not given the power to grant public recreation powers to the GIDs they created/had created. Those powers were not added to the list of basic powers County Boards could grant to GIDs until 196528.

IVGID Was Not Granted The Basic Power to Furnish Facilities For Public Recreation Until November 15, 196529:

The Powers GID Boards Could Exercise Were Enlarged in 1971 to Allow For The Fixing of “Standby Service Charges…For The Availability of Service:” Initially, County Boards were not authorized to grant the GIDs they created/had created the power to fix rates, tolls and charges for the services and facilities they were authorized to furnish but for the “construct(ion), reconstruct(ion), improve(ment), exten(sion) or better(ment of) the sanitary sewer system or any part thereof.”30 However, over the years that changed. And in 1967 former NRS 318.200(1) was modified31 to allow GID Boards “to…increase or decrease…rates, tolls or charges(, in part)…for the availability of…“public recreation.”32 And at that time, the rates, tolls and charges GIDs were permitted to fix were enlarged to “includ(e)…service charges for services or facilities furnished by the district…standby service charges…for the availability of service37

NRS 318.197(1): Finally, in 1971 the rates, tolls and charges a GID could fix were modified slightly to include, what they include today33. That is, the power to fix “standby service charges, for services or facilities furnished by the district, (and) charges for the availability of service” In other words, and for purposes of this discussion in particular, GID Boards are authorized to “fix, and from time to time increase or decrease…

1. Service charges…for services…furnished by the District;”

2. Service charges…for…facilities furnished by the District;”

3. Standby service charges, for services…furnished by the District;”

4. Standby service charges, for…facilities furnished by the District;” and,

5. Charges for the availability of service.”

So let’s examine each of these charges.

What Are “Services?” “Services are intangible, value-added activities that a (business34) provides to its customers. They…can be physical or digital. Physical services are those…you can touch, feel, or see, such as a haircut or a massage. Digital services are those that exist in the digital world, such as an app or a website…Service industries are those…that provide services to customers. These industries include…a) banking and financial services; b) professional services; healthcare; restaurants and food services; retail; transportation;”35 and as here, government. And given the context within which the question is asked (i.e., recreation), wouldn’t the answer to the question “what are services” be “recreation” services?

What Recreation Services Does The District Furnish? Given the above-definition of “service,” we can only assume that the answer to the question “what recreation services does the District furnish” is “intangible, value-added activities” which translates into “things” like recreation programming; golf, tennis, ski/snowboard lessons; etc.

What Are Charges For Services? “A service charge, also called a service fee, refers to a fee collected to pay for services that relate to a product or service (here recreation) that is being purchased36. In other words, some charge in consideration of some furnished “service.”

Given NRS 318.201(9) Allows GIDs to Collect The RFF/BFF Against “Each Parcel (Actually) Receiving…Services,” What Recreation Services Does The District Furnish to Those Parcels Which Are Assessed? The simple answer to the question is NONE! Because NRS 318.197(1) instructs GID Boards may “fix…service charges…for services…furnished by the district,” and NRS 318.201(9) instructs a GID Board may “prepare and file a final report…for inclusion on the assessment roll…which shall contain a description of each parcel receiving…services,” each year the Board passes a resolution5 which, in part, adopts the RFF/BFF. But where does the District tell the public that the adopted RFF/BFF pay for recreation services furnished to real property37? And why is this omission noteworthy? Because the District elects to collect the RFF/BFF on the Washoe County tax roll38. And as a pre-condition, NRS 318.201(9) mandates “the secretary…prepare and file a final report, which shall contain a description of each parcel receiving…services.” Therefore unless recreation services are furnished to those real properties which are assessed, there is no statutory authority for the District to collect the RFF/BFF on the county tax roll.

Moreover, exactly what services are furnished to property? When we think of services furnished to real property, we think of those delivered via some physical connection or those immediately adjacent thereto, don’t we? Services such as electricity or natural gas. Or cable internet and/or television. Or water and sewer services. Or maybe even solid waste removal and snow plowing services? All of which are delivered via public streets which are immediately adjacent to those parcels benefited or capable of being benefited. But what recreation or beach services are furnished to those real properties which are assessed? Which recreation or beach facilities are physically connected or immediately adjacent to those real properties? Unless your home is located adjacent to the fairway of one of the District’s two golf courses, we can’t think of any. Can you?

Finally, the sale of membership cards is not some “service.” Rather, it is the sale of tangible personal property, And as aforesaid, rather than real property, the beneficiaries of these membership cards are “property owners (i.e., people) of all properties” assessed10. This is another admission by means of conduct that the RFF/BFF do not pay for District recreation services. Let alone those furnished to real property.

What Are “Standby Service Charges?” Since this subject is thoroughly examined at our What is a Standby Service Charge page, we refer the reader to this linked discussion. But for purposes of definition, they represent: some sort of monetary levy against and of direct benefit to real property39; imposed for the mere availability to access and receive water and/or sewer40 service(s)41; where those services are delivered or capable of delivery to the real property assessed; and, that property is not a water and/or sewer customer. 

What Are “Facilities?” Given the context within which the question is asked (i.e., recreation), wouldn’t the answer be “a building or place used predominantly for…recreation, whether or not operated for the purposes of gain, including a squash court, indoor swimming pool, gymnasium, table tennis centre, health studio, bowling alley, ice rink…exposition buildings, museums, skating rinks, other type rinks, fieldhouses, sports arenas, bowling alleys, swimming pools, stadiums, golf courses, tennis courts, squash courts, other courts, ball fields, other athletic fields, tracks, playgrounds, bowling greens, ball parks, public parks, promenades, beaches, marinas, levees, piers, docks, wharves, boat basins, boathouses, harborages, anchorages, gymnasiums, appurtenant shower, locker and other bathhouse facilities, amusement halls, dance halls, concert halls, theaters, auditoriums, aviaries, aquariums, zoological gardens, biological gardens and vivariums,”42 or “any place of like character?”

What Recreation Facilities Does The District Furnish? Because NRS 318.197(1) instructs that GID Board(s) “may fix…service charges…for…facilities furnished by the district,” is it any surprise that the resolution the Board adopts10 each year pursuant to NRS 318.201(9) “specifically finds that: the availability of the use (as opposed to actual use) of IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center (i.e., facilities)…are all benefits?” Is it any surprise that I of the report the Board adopts51 pursuant to 6 of that resolution10 labels these amenities “recreational facilities?” And that “the (resolution) at issue was undoubtedly drafted with NRS 318.197(1)…firmly in mind?”43 Therefore the answer to the question of what recreation facilities the District furnishes, is VGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center.

Who Are The Beneficiaries of The Recreation Facilities The District Furnishes? Aren’t they people10? After all, how do real properties access and use the District’s recreation facilities described above?

What Are Charges For Facilities? As stated above44, “a service charge, also called a service fee, refers to a fee collected to pay for services that relate to a product or service (here recreation) that is being purchased.” But how does this type of charge differ from a fee collected to pay for facilities? It doesn’t!

Given NRS 318.201(9) Allows GIDs to Collect The RFF/BFF Against “Each Parcel (Actually) Receiving…Facilities,” What Recreation Facilities Does The District Furnish to Those Privately Owned Parcels Which Are Assessed? Again the answer is NONE! ¶¶4(b) and 4(c) of the resolution the Board adopts each year5 pursuant to NRS 318.201(9) finds that the availability of the facilities enumerated therein “are…benefits which inure to” people. But given those who are charged the RFF/BFF are property, and to be valid the RFF/BFF must “appl(y) to the direct beneficiar(ies) of (the) particular service(s),”44 we can’t think of any District recreation facility that is furnished to real property. Can you? Moreover, because District owned recreation facilities are public (see discussion below), aren’t they just as available to be accessed and used by anyone who pays applicable user fee(s) without payment of the RFF, as to those whose properties are assessed the RFF? And because the beaches are subject to an easement which accords that same access and use, free of payment of any fee, aren’t they available to be accessed and used by any property owner with beach access without payment of the BFF?

Moreover, how does real property access and use recreational facilities which are neither physically connected nor immediately adjacent thereto? Because NRS 318.197(3) mandates that “the board…prescribe and enforce regulations for the connection with and the disconnection from properties of the facilities of the district and the taking of its services,” doesn’t this language mean that in order to receive the recreation facilities the District represents it furnishes there must be some “physical connection” between the two45? If not, then when exactly do the consequences of NRS 318.197(3) come into play? Given here for the overwhelming majority of privately owned real properties which are assessed there is no such connection nor ability to connect, the simple fact of the matter is that no District owned recreation facility is furnished in consideration of payment of the RFF/BFF.

Yes we are mindful of the following language in ¶4(b) of the resolution5 adopted pursuant to NRS 318.201(9)9: “The Board specifically finds that…reduced rates for season passes and reduced daily rates…(at) IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center…are all benefits which inure to the owners of properties assessed hereunder.”10 However, “reduced rates” are different than no rates (i.e., user fees). And at the end of the day, picture passholders (“PPHs”), just like those who are not, end up paying user fees at essentially all District owned recreation facilities. Therefore, the RFF/BFF do not pay for the availability to access and use the District’s beach and recreation facilities which are furnished to people. Rather, they pay for nothing more than the right to be charged user fees at those facilities pursuant to a different fee schedule.

What Are Standby Facility Charges? There is no such beast. Take a long look at NRS 318.197(1). Although you will find “standby service charges,” you will not find comparable standby facility charges.

What Does The Term “Availability of“ Services or Facilities Mean? “The ordinary meaning of (the word) ‘available’ is ‘capable of use for the accomplishment of a purpose.'” Thus the provider of a service or facility must have “adequate capacity present or ready for immediate use” in order to assess a charge for the “availability” of services or facilities46.

Just Because IVGID Staff And Past Boards Have Told Us The RFF/BFF Represent “Standby And Service Charges8 (For)…The Availability of The Use9 of IVGID’s Beaches” And Other Delineated Public Recreation Facilities10, Doesn‘t Necessarily Make Them So: because “the nature of a monetary exaction must be determined by its operation rather than its specially descriptive phrase.”47 And for this reason “courts will determine and classify (monetary exactions like the RFF/BFF) on the basis of realities”48 rather than…labels, instead looking to their “operative effect.”49 So with that said, let’s examine those “realities” and their “operative effect:”

The RFF/BFF Do Not Represent Charges For Recreation Services Furnished by The District: Because NRS 318.197(1) instructs GID Board(s) “may fix…service charges…for services…furnished by the district,” one would have thought that the resolution the District adopts5 each year which adopts the RFF/BFF and elects to collect them on the county tax roll pursuant to NRS 318.201(9) would expressly recite that the RFF/BFF represent “charges for services…furnished by the district”50. But it doesn’t. Yes at ¶4(b) of that resolution and ¶I of the report adopted9 pursuant to ¶6 of that resolution51 the Board “specifically finds that the availability of the use of IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center…(or) the recreational facilities above described…are all benefits”52 for which the RFF/BFF are levied. But none of these charges pays for furnished services per se. Rather, they pay for “the (mere) availability of…use” of those facilities. And besides, staff and the Board have expressly told the public that the RFF/BFF represent “standby service charges.”8 So why would anyone doubt them? To the extent that resolution is labeled one for “service charges,”53 it is false.

Nor Do They Represent Standby Charges For Those Services49: NRS 318.197(1) instructs GID Board(s) “may fix…standby service charges for services…furnished by the district.” But because the District furnishes no “services” in consideration of payment of the RFF/BFF54, regardless of whether the RFF/BFF is paid, it is user fees which pay for the recreation services the District furnishes at those facilities. And if the RFF/BFF do not pay for the recreation services the District furnishes, how can they pay for the availability to access and receive any services, let alone water and/or sewer ones? 

And The RFF/BFF Do Not Represent Charges For Recreation Facilities Arguably Furnished by The District: Similarly, because NRS 318.197(1) instructs that GID Board(s) “may fix…service charges…for…facilities furnished by the district,” one would have thought that the resolution the District adopts5 each year pursuant to NRS 318.201(9)9 would expressly recite that the RFF/BFF represent “charges for…facilities furnished.” But again, they don’t.

Yes at ¶4(b) of that resolution and ¶I of the report adopted9 pursuant to ¶6 of that resolution62 the Board “specifically finds that the availability of the use of IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center…(or) the recreational facilities above described…are all benefits”63 for which the RFF/BFF are levied. But none of these charges pays for furnished facilities per se. Rather, they pay for “the (mere) availability of…use” of those facilities. And besides again, staff and the Board have expressly told the public that the RFF/BFF represent “standby…charges.”8 So why would anyone doubt them? To the extent that resolution is labeled one for “service charges,”53 it is false.

Yes at ¶4(b) of that resolution35 and ¶I of the report adopted via ¶6 of that resolution32 they recite that the Board “specifically finds that the availability of the use of IVGID’s beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center…(or) the recreational facilities above described…are all benefits”35 for which the RFF/BFF are levied. But none of these charges pays for furnished facilities per se. Rather according to the Board, they pay for “the (mere) availability of…use.”

And The RFF/BFF Do Not Represent Charges For The Availability of Recreation Services Arguably Furnished by The District: Although NRS 318.197(1) allows GID Boards to “fix…charges, for…the availability of service,” the District tells us that the RFF/BFF represent charges “for the availability of use of…recreational facilities.”55 Moreover, if the District furnishes no recreation services to those real properties which are assessed, how then can it legitimately assess the RFF/BFF for the alleged “availability” to access and use those services.

And The RFF/BFF Do Not Represent Charges For The Availability of Recreation Facilities Arguably Furnished by The District: If the District furnishes no recreation facilities to those real properties which are assessed, how then can it legitimately assess the RFF/BFF for the alleged “availability” to access and use those facilities25? Moreover, in order to legitimately assess standby service charges for the availability to access and use a service, the provider must have “adequate capacity present or ready for immediate use.” Where as here it doesn’t, “no standby fee c(an) lawfully be assessed”56? We don’t think it can.

Nor Do BFFs Represent “Charges For (Beach or Other42 Recreation) Services…Furnished by The District:” Putting aside differences between the availability of services versus those for facilities (see discussion below), “fees imposed by a governmental entity tend to fall into one of two principal categories: user fees, based on the rights of the entity as a proprietor of the instrumentalities used, or regulatory fees (including licensing and inspection fees), founded on the police power to regulate particular businesses or activities.”57 Because here the District is a limited purpose special district devoid of municipal police powers, nor does it have the power to impose regulatory fees58, by definition, its RFF/BFF must be a user fee. But here independent user fees are charged at most of the District’s public recreation facilities42, regardless of whether the RFF is paid38. So the fact one pays the RFF, doesn’t entitle him/her to actually receive any of the “services” offered thereat.

Since the RFF/BFF don’t pay for access to and use of any of the District’s public recreation42 facilities where user fees are charged, nor do they receive any services offered thereat, it’s disingenuous to label them “service charges.” So we won’t!

Nor Are They “Standby Charges…For The Availability of (Beach or Other42 Recreation) Service(s):” If the RFF/BFF do not pay for services furnished by the District, then how can they pay for the alleged “availability” of those services? Since they don’t, we won’t!

Nor Do BFFs Represent “Charges For…(Beach or Other42 Recreation) Facilities Furnished by The District” Where User Fees Are Charged: Assuming the RFF/BFF are the “instrumentalities used in exchange for” access to and use of the District’s breach and other public recreation facilities, just like fees to compensate for beach/other recreation services, that’s not what the RFF/BFF pay for. Because independent user fees are charged at most of the District’s public recreation facilities38, regardless of whether the RFF is paid. So the fact one pays the RFF/BFF doesn’t entitle him/her to actually use any of these facilities. And for this reason, it’s disingenuous to label them “facility charges.” And we won’t!

Nor Are They “Charges For…(Beach or Other42 Recreation) Facilities Furnished by The District” Where No User Fees Are Charged: The District does not charge user fees at every one of its public recreation facilities59. Notwithstanding, the District uses the RFF/BFF to subsidize overspending at all of those facilities. At the IVGID Board’s March 3, 2016 meeting former Finance Director Gerald Eick provided an “executive summary” in the “context…need(ed) for (then upcoming 2016-17) budget deliberations.” In that summary Mr. Eick presented a series of descriptive slides60. Those slides depicted Mr. Eick’s testimony insofar as the alleged benefits of the RFF. Insofar as recreational venues where no user fee is assessed, Mr. Eick testified that because there is essentially no other “user fee process (available) to generate a source” of revenue other than the RFF to pay for the costs associated with these facilities, the owners of those properties which are assessed should consider the RFF to be a user fee substitute61.

Since the RFF/BFF don’t pay for access to and use of any of the District’s public recreation42 facilities where no user fees are charged, it’s disingenuous to label them “facility charges.” And we won’t!

Nor Are They “Standby Charges…For The Availability of” Beach or Other Recreation Facilities: From the history above it can be seen that although GIDs have had the power to fix “standby charges” or “standby service charges” since 1967, that power really finds its genesis in rates, tolls and charges for services rather than any facilities, and sewer services rather than recreation ones. Moreover, when the power to fix “charges for the availability of service” was given to County Board, it’s noteworthy the power to fix “charges for the availability of facilities” was never given62! This omission means that the power to fix rates, tolls and charges for the “availability of facilities” was never intended to be included63 in the types of fees a GID could legitimately adopt. Since this is the alleged justification for the District’s RFF/BFF9, hopefully the reader sees there is no justification.

Nor Are They “Standby Charges…For The Availability of (Beach or Other42 Recreation) Service(s):” If the RFF/BFF do not pay for services furnished by the District, then how can they pay for the alleged “availability” of those services? Since they don’t, we won’t!

Regardless of Any of The Above, The District is Prohibited From Collecting The RFF/BFF on The County Tax Roll: Since the District’s beach and recreation services are furnished to people rather than those privately owned real properties which are assessed (see discussion above), and NRS 318.201(9) instructs that as a pre-cursor to collecting the RFF/BFF on the county tax roll those privately owned real properties which are assessed must “receiv(e) the services” furnished, the Board has no power to collect those charges on the county tax roll.

Notwithstanding Any of The Above, let’s assume for the moment, merely for argument’s sake, that the RFF/BFF are in fact “fees.” Because of the arguments and traits which follow, it’s clear they’re neither beach nor recreation “service” nor “standby service charges.” Let alone such charges for the availability to access and use the beaches and the District’s other public recreation facilities64:

Trait No. 1: The RFF Cannot Be a Legitimate Standby Service Charge When as Here it Allegedly Pays For The Availability of Recreation/Other Facilities65: Given the history of NRS 318.197(1), unsurprisingly, we’ve been unable to discover a single reported case, anywhere, which affirms assessment of a standby service charge for the availability of use of a public facility (like the jails, courts, libraries, parks, police department, district attorney’s office, city hall, etc.) equally accessible to any other member of the general public. Rather, and universally we might add, reported cases support assessment of standby service charges for the availability of services. That’s likely because the definition of standby service charges, from those jurisdictions which have defined the term, is that they pay for the availability of services66. Moreover, the fact the fact the words “availability of facilities” were omitted from the 1967 modifications to NRS 318.197(1), means that the “availability of facilities“ was intended to be excluded67.

Given the RFF/BFF arguably (according to the District) pay for “the availability of the use of IVGID’s beaches” and other delineated public recreation facilities9, rather than the services offered thereat, they cannot and do not represent legitimate standby service charges. And that should be the end of the discussion! But,

Trait No. 2: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Do Not Pay For “Special Benefits:”50 “To distinguish between a ‘fee’ and a ‘tax’ the Hawaii Supreme Court in Medeiros adopted a…test (the first pillar of)…which analyzes whether the charge…'(1) confer(s) some (type of special) benefit63‘ (to the beneficiary), direct or indirect.”68 We can and do infer that IVGID staff recognize that the RFF/BFF are not standby service charges because of the inclusive language in ¶48 and ¶4(b)9 of the resolution the Board adopts each year which fixes the RFF/BFF and orders their collection on the county tax roll6. In other words, language which incorporates the required findings “that each parcel assessed…is specifically benefited.”8 And “that the availability of the use of IVGID’s beaches (and other enumerated recreation facilities)…are all benefits which inure to the owners of properties assessed (t)hereunder.”9 Additionally, by electing to use NRS 318.201(1) and (9) to collect the RFF/BFF [where “any board which has adopted rates pursuant to this chapter…elect(s) to have such charges for the forthcoming fiscal year collected on the tax roll(, it shall)…cause a written report to be prepared…and filed…which…contain(s)…the amount of the charge for each…parcel of real property receiving…services and facilities“], IVGID staff have in essence admitted that each parcel assessed has received special benefits53.

But are these alleged benefits really benefits? Or as Medeiros instructs54, regardless of the artful language employed, does “the governmental activity (for which the RFF/BFF are assessed)…confer some (peculiar) benefit…to (the) beneficiary which is separate and apart from any benefit conferred to the public at large?” Here the facts demonstrate a resounding no!

Consider that Washoe County has granted the District the basic power to furnish facilities for public recreation69. Based upon this grant, District staff and the Board have represented that the RFF pays for the availability to access and use70 “IVGID’s…Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and (the) Recreation Center.”9 But because these facilities are public, they’re just as available to be accessed and used by any member of the general public, whether or not he/she owns real property in Incline Village/Crystal Bay, or his/her property is assessed the RFF. Therefore those who pay the RFF, or more importantly their Incline Village/Crystal Bay real properties because they’re the ones actually assessed71, realize no special “benefit” whatsoever! Let alone in a manner “not shared by other members of a society.”72.

Given the RFF fails to pay for special benefits to those properties which are assessed, it cannot and does not represent a legitimate standby service charge.

Trait No. 3: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Do Not Pay For Special Benefits Furnished to Real Property50: Those courts which have addressed the subject of standby service charges have defined the term to mean some sort of monetary levy against and of direct benefit73 to real property74. Yet here the alleged benefits furnished in consideration of payment of the RFF/BFF are to people.

For years staff have accompanied the District’s final budgets with a letter addressed, in part, to “the…Citizens of Incline Village and Crystal Bay.”75 The letter has in part expressly answered the question of “What Privileges…Parcel Owners Get For Paying…Facility Fees.” Stated differently, the letter informs citizens what the RFF/BFF actually pay for? We quote from page 16 of the letter accompanying the 2018-19 Budget:

“Each eligible parcel that pays the RFF can have five (5) cards issued in the form of picture passes…and/or punch cards…or a combination of both. The Picture Passholder76 (“PPH”) gets preferred pricing and/or preferred access to the District’s major (recreation) venues or programming…A Punch Card Holder62 receives the opportunity, at designated (recreation) venues, to reduce their user fees from the (retail) rack rate to the (preferred) PPH rate.”

In other words, staff clearly admit the RFF pays for nothing more than up to five (5) membership cards similar to those sold by Costco and Sam’s Club (see discussion of trait no. 11 below). Given the direct beneficiaries62 of the alleged benefits furnished in consideration of payment, the RFF/BFF cannot and do not represent legitimate standby service charges.

Trait No. 4: The BFF Cannot Be a Legitimate Standby Service Charge When as Here it Does Not Pay For Access to And Use of District Beaches: According to staff and the Board, the BFF is a charge for the availability to access and use the beaches. ¶4(b) of the resolution the Board passes each year6 which adopts the RFF/BFF and orders their collection on the county tax roll9, recites that “the availability of the use of IVGID’s beaches…(is a) benefit…which inure(s) to the owners of properties62 assessed (t)hereunder.” But take a close look at the beach deed [under which the District holds bare legal title to our four (4) beaches]:

“Grantor77…specifically reserves an easement…for the benefit of all…owners of property located within…the (then) constituted boundaries of the Incline Village General Improvement District…and their respective successors and assigns in such ownership…to enter upon…and…use (the beaches)…for the recreational uses and purposes specified (t)herein.”

Therefore the owners of property assessed the BFF, and we successors and assigns, have access to and use of the beaches not because of our payment, but rather, beach deed easements!

Yes we are mindful the beach deed also recites that the District’s “Board of Trustees shall have authority to levy assessments as provided by law.” However, this power does not allow IVGID to pre-condition a parcel owner’s exercise of his/her/its deed easement rights to access and use the beaches upon payment of the BFF for at least four (4) reasons.

1. First, non-payment cannot defeat a property owner’s right to exercise a grant of easement;

2. Second, because the District contends the BFF is an assessment adopted pursuant to the authority of NRS 318.197(1)78 and the beach deed, by definition, it really cannot be an “assessment,” let alone one “provided by law;”79

3. Third, a GID’s authority to make assessments is set forth in NRS 318.350. The BFF does not fit within the statutory limitations of that assessment power; and,

4. Finally, aren’t we so oftentimes told that our beaches are “private?”80 If so, NRS 318.015(2) comes into play as it instructs “the provisions of this chapter are not intended to provide a method for financing the costs of developing private property.” Which means that where as here81 the BFF is and will be used for this prohibited purpose, its validity cannot be a charge “provided by law.”

Given staff and the former Board have represented that the BFF pays for “the availability of the use of IVGID’s beaches” which are independently available to be accessed and used by those whose real properties are assessed, no special benefit is furnished in consideration of payment and for this reason, the BFF cannot and does not represent a legitimate standby service charge.

Trait No. 5: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Are Not Voluntarily Assessed50: As Emerson College instructs82, standby service charges “are paid by choice in that the party paying the fee has the option of not utilizing the governmental service and thereby avoiding the charge.”83 Although the modified version of this test84 has “weakened its adherence to th(is)” voluntariness pillar insofar as “otherwise legitimate (standby service) charge(s)”85 are concerned, here the District’s charges for the alleged availability of recreation facilities are not legitimate standby service charges. Therefore under these circumstances the required “voluntary receipt of the service” pillar requirement remains.

The Board has adopted a “Recreation Roll Policy” (see ¶1.0 of Policy No. 16.1.1) which instructs that “the Incline Village General Improvement District will charge the prescribed Recreation Fee, and if applicable…(the) Beach Fee, to all qualifying real properties!” Since ¶¶7-8 of the resolution the Board adopts each year6 which fixes the RFF/BFF and orders their collection on the county tax roll86 instructs that: “the Washoe County Treasurer shall enter the amounts of the charges (in two separate and distinct lines items identified as Recreation Facility Fee and Beach Facility Fee) against the respective lots or parcels of land as they appear on the current Washoe County tax roll,” it is evident that those who are assessed the RFF/BFF have no say in whether they consent to the assessment. Under these circumstances, the RFF/BFF cannot and do not represent legitimate standby service charges.

Trait No. 6: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here Those Real Properties Assessed Are Not Direct Beneficiaries of The Alleged Benefits Furnished50: As Medeiros instructs54, fees “are charged in exchange for a particular governmental service which benefits the party paying the fee.” In fact, this is the first pillar of the “modified version of the test…the Hawaii Supreme Court…articulated by the Massachusetts Supreme Judicial Court in Emerson College which differentiates ‘fees’ from (other types of exaction such as) ‘taxes’ (and) adopted…in” Medeiros87. In other words, “one which analyzes whether the charge: (1) applies to the direct beneficiary of a particular service.”

Yet as discussed above, the direct beneficiaries of the alleged benefits furnished in consideration of payment of the RFF/BFF62 are not the ones who directly benefited. Rather, those beneficiaries are real property88! Since ¶¶7-8 of the resolution the Board adopts each year6 which fixes the RFF/BFF and orders their collection on the county tax roll86 instructs that: “the Washoe County Treasurer shall enter the amounts of the charges (in two separate and distinct lines items identified as Recreation Facility Fee and Beach Facility Fee) against the respective lots or parcels of land as they appear on the current Washoe County tax roll,” it is clear that the direct beneficiar(ies) of (the) particular service(s)” furnished in consideration of payment are not the ones compelled to pay.

Moreover, when The Board elects to collect the RFF/BFF on the county tax roll each year, NRS 318.201(9) instructs it “prepare and file a final report…which…contain(s) a description of each parcel receiving…services (and)…the amount of the charge (therefore)…for inclusion on the (real property) assessment roll.” Since ¶4(b) of the resolution adopted pursuant to NRS 318.201(9) which incorporates that report6 “specifically finds that the availability of the use of IVGID’s (facilities; i.e.,) beaches; boat launch ramp; Championship golf course; Mountain golf course; tennis facilities; the Chateau and Aspen Grove; Diamond Peak Ski Resort, and Recreation Center…are all benefits…provided to said (real) properties,” how can parcels of real property possibly access and use any of these recreation facilities? And however one answers the question, it’s clear those assessed cannot be direct beneficiaries of the alleged benefits furnished

Finally, since the District’s public recreation facilities are just as available to be accessed and used by any member of the general public, as by the owners/occupants of those real properties which are assessed, the world’s tourists are benefited in their use notwithstanding the overwhelming majority are not the beneficiaries who pay the RFF/BFF.

For all of these reasons then, the RFF/BFF do not represent legitimate standby service charges for District owned recreation furnished to real property because the true beneficiaries are not those who make payment.

Trait No. 7: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here There is No Physical Connection or Ability to Physically Connect50 The District’s Recreation/Other Facilities And Those Real Properties Which Are Assessed: When we think of services furnished to real property, we tend to think of those physically connected to or immediately adjacent, don’t we? Like public water and sewer services where there are physical laterals connecting the public’s utility services to each parcel of real property benefited. Because NRS 318.197(3) makes the point there must be some sort of physical “connection” between “properties of the facilities of the District and the taking of its services.”89 For this reason most courts which have addressed standby service charges have declared there must be some sort of physical “connection”90/abutment or ability to connect91 between the available public service and the properties benefited therefrom. Which explains why NRS 318.197(3) goes on to mandate GIDs “prescribe and enforce regulations for (a parcel’s)…connection(s) who and…disconnection from (the)…properties of the facilities of the district and the taking of its services.” But here in Incline Village/Crystal Bay we can’t think of any privately owned parcel which is physically connected to one or more of the District’s public recreation or beach facilities. Although there are a relatively few which abut or are adjacent to the District’s public recreation or beach facilities, we can’t think of any which is capable of being physically connected to those facilities.

Given few if any of those parcels which are assessed the BFF and/or the RFF abut, are adjacent to, or are capable of being physically connected to the District’s beach or recreation facilities, the RFF/BFF cannot and do not represent legitimate standby service charges.

Trait No. 8: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Do Not Pay For The Availability of Any Type of Service Other Than One Which Advances Public Health And Sanitation92, And Here The District’s Recreation/Other Facilities Do Not: Putting aside differences between the availability of services versus facilities, in order to assess standby service charges which pay for a direct benefit furnished, that benefit must advance public health and sanitation93. Such as water, sewer or possibly solid waste disposal services. Unsurprisingly then, we’ve been unable to discover a single reported case, anywhere, which supports assessment of a standby service charge for the availability of use of a service which neither addresses public health and sanitation.

Notwithstanding the District’s beaches and public recreation facilities are allegedly facilities rather than services which are furnished in consideration of the RFF/BFF, none of those facilities address public health and sanitation. Therefore the RFF/BFF which allegedly pay for their “availability” cannot and do not represent legitimate standby service charges.

Trait No. 9: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here The Alleged Services For Which The RFF/BFF Are Assessed Are Not Immediately Available50: Putting aside differences between the availability of services versus facilities, in order to assess standby service charges therefore, 100% of the District’s public recreation facilities must exhibit the capacity to be used 100% of the time94 by all occupants of the 8,200+ parcels/dwelling units which are assessed. When the provider of a public service assesses a standby service charge, yet lacks the capacity to make 100% of those services represented available to be used by those assessed, those standby service charges are impermissible79.

Since here the District lacks the capacity to make access and use of 100% of the beaches and its various public recreation/other facilities available to be used by the occupants of 100% of the local parcels which are assessed the RFF/BFF, these exactions cannot and do not represent legitimate standby service charges.

Trait No. 10: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here Those Real Properties Which Are Allegedly Benefited Are Already Receiving That Service50: Once a property which is assessed a standby service charge becomes an actual customer of the service represented thereby, by definition, that service is no longer “standing by” nor “immediately available” to be delivered. Instead, it is actually being delivered and used80. But when a PPH pays user fees to access and use a District owned public recreation/other facility95 And the RFF is not eliminated/adjusted. Because these customers are already actual customers of the service represented, the RFF to them, represents a minimum use charge96. Although NRS 318.197(1) allows GID Boards to fix minimum use charges, the point here is that staff and the Board have labeled the RFF/BFF something different. And something different which arguably justifies those charges to be levied involuntarily.

Given the RFF represents a minimum use charge rather than a standby service charge, and those whose properties are assessed are already paying as actual customers, the RFF/BFF cannot and do not represent legitimate standby service charges.

Trait No. 11: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Allegedly Pay For Benefits to People50: As stated above, standby service charges furnish some direct benefit to real property. For this reason ¶¶4(b)-(c) of the resolution which appear at page 230 of the 5/26/2022 Board packet represent findings by the IVGID Board in support of the RFF/BFF that the alleged benefits represented in consideration of payment are not only “directly” furnished to people97, but those people are allegedly “benefited in a fair and reasonable way for the sums which they are charged” (see the discussion of trait no. 14 below insofar as “reasonably proportionate”).

Moreover, ¶4(a) of that same resolution (at page 229 of the 5/26/2022 Board packet) clarifies that “Ordinance…7 sets forth in detail the…benefits available to (those) property owners“62 whose properties are assessed. Examining Ordinance 7, ¶60 instructs that “every eligible residential Parcel may receive any combination of up to five (5) Cards98” in consideration of payment that are “IVGID Recreation Passes and/or…Punch Cards.” Given: ¶34 of Ordinance 7 defines a picture pass holder (“PPH”) as “an individual62 who has been issued an IVGID Recreation Pass;” ¶60 instructs that a PPH “may be assigned to any (property) owner’s eligible family member62…or…Tenant62 who…also qualifies under this Ordinance;” and, ¶64 instructs that a PPH “provides (people with)…reduced season pass rates at District-owned ski, and tennis facilities…reduced daily rates at District-owned golf, ski and tennis facilities…reduced yearly, quarterly, monthly, or weekly membership rates at (the) District-owned Recreation Center…reduced rates on various recreation programs and services…at the District-owned Recreation Center…reduced rates for the rental of the Chateau, Aspen Grove Community Building, Diamond Peak Ski Lodge, Recreation Center, and District owned athletic fields; and watercraft launching access at the District-owned watercraft ramp to Pass Holders62 with Beach Access, for a fee; (and,)…the ability to bring Guest(s)62 to District-owned Beaches for a fee;” all of these alleged benefits furnished in consideration of payment of the RFF/BFF represent benefits to people rather than property.

Given the RFF/BFF (at least according to the District) pay for alleged benefits to people rather than property, they cannot and do not represent legitimate standby service charges.

Trait No. 12: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Allegedly Pay For The Availability of Non-Special Alleged Benefits50: In other words, those available to the general public as a whole. Expanding upon Medeiros‘ instructions54, legitimate fees “are charged not only in exchange for a particular governmental service, but one which benefits the party paying…in a manner ‘not shared by other members of society.'” In other words, to “the party paying the fee in a manner not shared by other members of a society.”99 Thus where the service furnished benefits the entire general public as a whole, rather than just those whose properties are assessed, there is nothing “special”53 about it, and the charge cannot be sustained.

Given here the RFF allegedly pays for the availability of public recreation/other facilities upon the condition additional user fees38 are paid, and these alleged benefits are available to the general public as a whole aka “the world’s tourists,” rather than just those62 whose real properties are assessed, it cannot and does not represent a legitimate standby service charge.

Trait No. 13: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Are Not Limited to Those Sums Necessary to “Directly…Defray The Costs (Actually Incurred) in Furnishing Those Service(s)100 For Which The RFF/BFF Are Assessed101: Again, “to distinguish between a ‘fee’ and a ‘tax’ the Hawaii Supreme Court in Medeiros adopted a…test(, the second pillar of)…which analyzes whether the charge…'(2) is allocated directly to defraying the costs of providing the service‘…”54 “When it appears…that revenue is (the) main objective (of an enactment), and the amount of the tax supports that theory102, (it) is a revenue measure.”103 Here the real purpose of both the RFF/BFF is as a revenue measure which makes them both special taxes68. We come to this conclusion for at least three (3) reasons.

1. First, listen to what former IVGID Finance Director, Paul Navasio, and the Board have told us is the purpose of the RFF/BFF: “The RFF/BFF “are established based on the revenues required to (financially) support104 debt, capital expenditure and operations for the District’s various recreation and beach facilities.”105 Stated differently, “the costs of…acquisition, administration, operation, maintenance and improvement of (District owned)…recreational facilities, including the improvements thereon, and of the servicing of bonds issued or to be issued therefor.”106 When “combined with (operational) service charges collected…for facility use and program activities, (the RFF/BFF) serve to (financially) support91 the operations of the District funded by (its) Community Services…and Beach Fund(s), respectively.”107 In other words, “the costs of…acquisition, administration, operation, maintenance and improvement of (District owned)…recreational facilities, including the improvements thereon, and of the servicing of bonds issued or to be issued therefor.”93

So when staff represent that the RFF/BFF are required to (financially) support the District’s various recreation and beach facilities, please understand this is an admission these fees represent the difference between budgeted revenues (from operational “service charges collected…for facility use and program activities”) and intentional overspending [on “debt, capital expenditure(s) and operations for the District’s various recreation and beach facilities” as well as “the servicing of bonds issued or to be issued therefor“] assigned to the District’s Community Services (insofar as the RFF is concerned) and Beach (insofar as the BFF is concerned) Funds, respectively108.

2. Second, here District staff actually use the RFF/BFF as a means for collecting far more than merely the costs it incurs to make District owned recreation and beach facilities available to be used by those parcels/dwelling units which are assessed109. Given “a ‘fee’ is a payment for a special privilege or service rendered, and not a revenue measure…(i)f the ‘fee’ unreasonably exceeds the value of the specific services for which it is charged[,] it will be held (to be) invalid.”110 Although there are a number of ways to demonstrate that the RFF/BFF unreasonably exceed the value for mere “availability” to access and use the District’s public recreation/other facilities after paying individual user fees thereat, let us suggest just one.

3. Finally, massive increases in Community Services and Beach Fund balances111 over just seven (7) of the last ten (10) years! Until the brutal unsustainability of intentional overspending could no longer be hidden from the public and denied by staff, each fund balance had increased markedly.

Remember, our staff are incapable of operating, maintaining, and providing for capital at District recreation/other and beach facilities based upon the revenues they’re able to generate. That’s why we have the RFF/BFF which as aforesaid acts as a financial subsidy91. So how can there be anything left over to add to fund balance? Unless the RFF/BFF total more than the amount of the subsidy.

On July 1, 2015 the fund balance in the District’s Community Services (recreation) Fund was reported at $5,357,755112. On the same date, the fund balance in the District’s Beach Fund was reported at $1,107,786113. Seven (7) years later, on July 1, 2022, the fund balance in the District’s Community Services Fund was reported at an unbelievable $64,672,710114. On the same date, the fund balance in the District’s Beach Fund was reported at a similarly unbelievable $13,934,794115. That’s a nearly one-thousand one-hundred and seven percent (1,107%) increase in the Community Services Fund [which equates to more than a one-hundred and fifty-eight percent (158.14% to be precise) yearly increase for seven (7) consecutive years], and a nearly one-thousand one-hundred and fifty-eight percent (1,158%) increase in the Beach Fund [which equates to more than a one-hundred and sixty-five percent (165.43% to be precise) yearly increase for seven (7) consecutive years]! How could the fund balances in both of these funds increase so dramatically in so short an amount of time absent massive operational profits (which were not generated) or excessive RFF/BFF subsidies? Obviously, the RFF/BFF have totaled far, far more than the costs to directly defray the expenses the District has incurred to furnish the availability to access and use District owned recreation and beach facilities, and the represented services thereat. Where as here the fees exceed the costs the District incurs to furnish recreational or beach facilities or services, it is a tax116! The RFF/BFF are not fees! Moreover,

1. The holder of a PPH or punch card realizes no recreation benefits (alleged “preferred pricing”61) unless and until he/she elects to access and use the District’s public recreation/other facilities and pay additional user fees38. Until then these cards have no value whatsoever. Especially given ¶99 of Ordinance No. 7 “strictly forbid(s)…any IVGID Recreation Pass (or)…Punch Card Holder or other individual…(from) sell(ing) an Assignment of Recreation Privileges, or…sell(ing) individual IVGID Recreation Passes or…Punch Cards” which prevents the PPH or punch card holder from realizing their inherent value.

2. Even where a PPH or punch card holder is able to realize so called “preferred pricing” at a District public recreation/other facility, in many instances, that preference is de minimis. Two simple examples prove the point: Daily adult membership rates at the Rec Center stand at $18. But if one presents a PPH or punch card, the rate can be reduced by a whopping $4 (22.2%) to $14. Similarly, daily adult court reservation fees at the Tennis Center stand at $18. But if one presents a PPH or punch card, the rate can be reduced by a whopping $3 (16.67%) to $15. Yet the RFF is nowhere proportionate to the de minimis “preferred pricing” benefit at these two recreation facilities!

 3. Staff and past boards want local parcel owners to believe the RFF/BFF pay for the costs of capital and debt associated with the beaches and District recreation/other venues117. But staff and past boards have told the public that the RFF is a subsidy which pays for something else; the difference between revenues and operating, overhead, capital and debt service costs.

For all these reasons, the RFF/BFF are: far in excess of the reasonable and necessary costs to make the beaches and other District owned recreation facilities available to be used by those properties which are assessed; they exceed the direct costs reasonable or necessary to provide this service; the alleged benefit furnished is not reasonable; and as a consequence, they are taxes118. Stated differently, these exactions cannot and do not represent legitimate standby service charges.

Trait No. 14: The RFF/BFF Cannot Be Legitimate Standby Service Charges When as Here They Are Not “Reasonably Proportionate to The Alleged Benefit(s) Furnished:”50 Again, “to distinguish between a ‘fee’ and a ‘tax’ the Hawaii Supreme Court in Medeiros adopted a…test…(the third pillar of which) analyzes whether the charge…'(3) is reasonably proportionate to the benefit received.'”54 In other words, the RFF/BFF must be proportionate to the costs the District actually incurs to furnish the availability to access and use the recreation and beach facilities represented for which these fees are assessed119. Or stated differently, “the services for which the (RFF/BFF) are imposed (must be) sufficiently particularized as to justify distribution of the costs among a limited group (the ‘users,’ or beneficiaries of the services), rather than the general public”120 as a whole. And it is for this reason that ¶5 of the resolution the Board adopts each year which fixes the RFF/BFF and orders their collection on the county tax roll recites that the RFF/BFF6 “are reasonable in their relation to the object of the charges imposed…and that said charges have been apportioned in relation to said natural, intrinsic, fundamental and reasonable distinctions among said rates.”9

But just because staff and the Board have adopted the necessary language, doesn’t necessarily mean it is truthful. Here we’ve demonstrated that no benefits are furnished in consideration of payment of the RFF/BFF (see discussion above). And that “the (alleged) benefits of (availability to access and use District owned recreation and beach facilities)…are not limited to (just) the [parcels/dwelling units assessed (see discussion above)]…The capacity to (furnish District owned recreation and beach facilities extends to)…not only the private property interests of the owner(s), but also the(ir)…building’s occupants as well as (those of) surrounding buildings and their occupants.”121 And of course, the world’s tourists.

“If the benefits for which (the RFF/BFF) are imposed were limited to (just) the owners of (assessed parcels/dwelling units and they were)…essential to the public welfare, there would be no reason to depart from the optional character of a traditional fee.”122 But because here they are not, and the District has failed to “sufficiently particularize…the services for which the (RFF/BFF) are imposed,” there is no “reasonable proportionality” to the value of the arguable benefit(s) furnished123. And that’s what we have here.

Given the lack of reasonable proportionality insofar as the alleged benefit(s) furnished by the RFF/BFF are concerned, those exactments cannot and do not represent legitimate standby service charges.

For All of The Above Reasons, The RFF/BFF Are Neither “Service Charges;” “Standby Service Charges For…(Recreation) Facilities Furnished by The District;“ Nor “Charges For The Availability of“ Recreation Facilities: Because NRS 318.197(1) instructs GID “Board(s) may fix…service charges…for…services…furnished by the district,” wouldn’t you the reader expect the resolution the Board adopts each year pursuant to NRS 318.201(9)9 to specifically find that the RFF/BFF pay for recreation services furnished to those real properties which are assessed assuming such services were furnished? And for the same reason, wouldn’t you expect the Board to specifically find that the RFF/BFF pay for recreation facilities furnished to those real properties which are assessed assuming such facilities were furnished? So where are those findings? What recreation services do the RFF/BFF pay for which are allegedly furnished to those real properties which are assessed? What recreation facilities do the RFF/BFF pay for which are allegedly furnished to those real properties which are assessed?

Assuming the answer is “no,” and for all of the above-reasons, it seems pretty clear that the RFF/BFF do not represent NRS 318.197(1) charges for District owned recreation services and facilities allegedly furnished to real property. And they certainly don’t represent standby service charges for the availability of those real properties which are assessed to access and use District owned recreation services or facilities. And if we’re wrong, how is it that the only people assessed are those who own non-exempt real property in Incline Village/Crystal Bay and are expressly benefited? Why not every resident of Incline Village/Crystal Bay? And what is the authority for levying the RFF/BFF against real property when the benefits allegedly furnished are to people?

Conclusion: ¶4 of the resolution the Board ultimately passes each year pursuant to NRS 318.201(9)9 which declares the RFF/BFF to be recreation and beach “service” charges is false. Its declaration they are “recreation standby…charges” for the mere “availability” to access and use beach and district owned recreation facilities is false. It seems pretty clear that some creative lawyers for IVGID124, in its infancy, seized upon these artfully drafted words to justify the current, questionable funding source for essentially everything the District does. The fact of the matter is that there is no legitimate justification for the RFF/BFF, whether they be: NRS 318.197(1): “standby service charges for services…(allegedly) furnished by the district;” “standby service charges…for…facilities (allegedly) furnished by the district;” “charges for the availability of facilities;” or any other exaction given the RFF/BFF do not meet the minimum requisites for legitimate standby service charges staff/prior Boards represent/have represented. Thus, the RFF/BFF cannot be nor are they legitimate standby service charges.

  1. See page 102 of the packet of materials prepared by staff in anticipation of the Board’s May 27, 2020 meeting (“the 5/27/2020 Board packet”).
  2. Which allows general improvement district (“GID”) boards to “fix (in part)…recreational facilit(y)…service…and standby service charges, for services or facilities furnished by the district, (as well as)…the (mere) availability of service…”
  3. NRS 318.201 allows “any (GID) board which has adopted rates pursuant to…chapter (NRS 318) to…elect to have such charges for the forthcoming fiscal year collected on the tax roll.”
  4. See page 103 of the 5/27/2020 Board packet.
  5. See NRS 318.201(9). For an example of the type of resolution, see pages 185-193 of the packet of materials prepared by staff in anticipation of the Board’s May 26, 2021 meeting (“the 5/26/2021 Board packet“).
  6. An example of that report (for fiscal year 2021-22) appears at pages 188-193 of the 5/26/2022 Board packet.
  7. See NRS 318.201(8) and (9).
  8. See ¶4 at pages 185-186 of the 5/26/2021 Board packet.
  9. See ¶4(b) at page 186 as well as ¶I at page 190 of the 5/26/2021 Board packet.
  10. See page 186 of the 5/26/2021 Board packet.
  11. ¶64 of Ordinance 7 instructs that “an IVGID Recreation Pass…provides the Pass Holder (with): a. reduced season pass rates, at District-owned ski, and tennis facilities; and b. reduced daily rates at District-owned golf, ski and tennis facilities; and c. reduced yearly, quarterly, monthly, or weekly membership rates at District-owned Recreation Center; and d. reduced rates on various recreation programs and services reduced daily rates at the District-owned Recreation Center; and e. reduced rates for the rental of the Chateau, Aspen Grove Community Building, Diamond Peak Ski Lodge, Recreation Center, and District owned athletic fields; and f. watercraft launching access at the District-owned watercraft ramp to Pass Holders with Beach Access, for a fee; and g. The ability to bring Guest(s) to District-owned Beaches for a fee, when accompanying an IVGID Recreation Pass Holder with Beach Access, only as set forth in Article VII; and h. any other Recreation Privileges determined by the Board.”
  12. That’s right. Best Buy has entered the pay a fee and become a member game. It’s called My Best Buy Plus and Total Memberships. Pay a yearly fee (either $49.99 for “Plus” membership, or $179.99 for “Total” membership), become a member, and now you’re entitled to preferred (i.e., “exclusive”) access and preferred “member pricing!”
  13. ¶81 of Ordinance 7 instructs that “a Recreation Punch Card provides the Pass Holder with a face value of Recreation Privileges, determined by the Board, which may be applied toward: a. The Guest rate for daily Beach Access, daily watercraft and jet ski launching; and b. the difference between the Pass Holder rate and the non-Pass Holder rate for daily access to the District-owned golf, ski, recreation center, and tennis facilities; and c. the difference between the Pass Holder rate and the non-Pass Holder rate for any other recreation use fee or rental fee as may be determined by the Board. d. When a Recreation Punch Card is used for Beach Access, the balance of funds on the Recreation Punch Card will be applied to the Guest Fee, until the balance of funds on the Recreation Punch Card is used up, at which time the Recreation Punch Card cannot be used for Beach Access or for access or any other purpose at any other Recreation Facility or Recreation Venue.”
  14. The last such letter staff published was dated May 23, 2018, and it can be found at pages 10-18 of the 2018-19 Budget. Once members of the public learned of this admission and publicized it as evidence the RFF/BFF are “taxes” rather than standby service charges, uncoincidentally and mysteriously, it ceased to exist.
  15. See page 232 of the packet of materials prepared by staff in anticipation of the Board’s May 26, 2022 meeting (“the 5/26/2022 Board packet“).
  16. See ¶I at page 234 of the 5/26/2022 Board packet.
  17. See Arguello v. Sunset Station, Inc., 127 Nev. 365, 370, 252 P.3d 206, 209 (2011).
  18. See State Farm Mut. v. Comm’r of Ins, 114 Nev. 535, 540, 958 P.2d 733 (1998); Erwin v. State of Nevada, 111 Nev. 1535, 1538, 908 P.2d 1367, 1369 (1995) [quoting Charlie Brown Constr. Co. v. Boulder City, 106 Nev. 497, 503, 797 P.2d 946, 949 (1990)]; Washoe Med. Ctr. v. Second Jud. Dist. Ct., 122 Nev. 1298, 1302, 148 P.3d 790, 792-793 (2006).
  19. See Saint Alphonsus Reg’l Med. Ctr. v. Gooding Cty., 159 Idaho 84, 356 P.3d 377, 382 (2015).
  20. See Nunez v. Sahara Nevada Corp., 677 F. Supp. 1471, 1477 (D. Nev. 1988).
  21. See Local 1494 of the Int’l Ass’n of Firefighters v. City of Coeur d’Alene, 99 Idaho 630, 639, 586 P.2d 685, 688 (1999).
  22. Go to https://1995blog.com/2020/09/27/quote-of-the-1990s-if-it-doesnt-fit-you-must-acquit-25-years-on/.
  23. NRS 318.210 is the statutory embodiment of this portion of Dillon’s Rule: a GID “board shall have and exercise all rights and powers necessary or incidental to or implied from the specific powers granted in this chapter.”
  24. See NRS 244.137(3) and 268.001(3).
  25. See NRS 244.137(4) and 268.001(4).
  26. Now known as NRS 318.010.
  27. See 1959 Statutes of Nevada, commencing at page 457.
  28. See 1965 Statutes of Nevada, commencing at page 1088, Sec. 21.5.
  29. See Washoe County Bill No. 132, Ordinance No. 97.
  30. See former NRS 318.200(1); 1959 Statutes of Nevada, commencing at page 463, Sec 27(1).
  31. See former NRS 318.200(1), 1967 Statutes of Nevada, commencing at page 1700, Sec. 33.
  32. See former NRS 318.200(1), 1967 Statutes of Nevada, commencing at page 1693, Sec 24(13).
  33. See former NRS 318.200(1) and 1971 Statutes of Nevada, commencing at page 188, Sec 1.
  34. The District’s recreation venues are operated as commercial “for profit” business enterprises.
  35. Go to https://oboloo.com/blog/what-are-services-definition/.
  36. Go to https://corporatefinanceinstitute.com/resources/wealth-management/service-charge/.https://corporatefinanceinstitute.com/resources/wealth-management/service-charge/.
  37. See that “Report For Collection on the County Tax Roll of Recreation Standby and Service Charges.”6
  38. See ¶7 at page 190 of the 5/26/2021 Board packet.
  39. Rather than people.
  40. Rather than recreation.
  41. Rather than facilities.
  42. See NRS 318.143(3).
  43. See Rider v. County of San Diego, 1 Cal.4th 1, 15, 820 P.2d 10 (1991).
  44. Legitimate fees “are charged in exchange for a particular governmental service which benefits the party paying the fee in a manner ‘not shared by other members of society’” [see National Cable Television Ass’n, Inc. v. F.C.C., 554 F.2d 1094, 1106 (D.C. Cir. 1976); Emerson College, supra, at 391 Mass. 424; Clean Water Coalition, supra, at 127 Nev. 315]. Here the party paying the RFF/BFF (i.e., real property) is not the one benefited
  45. This view comports with the definition of standby service charge provided above. That is, that the available service must be physically connected or immediately adjacent and capable of connection to those real properties which are assessed.
  46. See McMillan v. Texas National Resources Conservation Comm’n, 983 S.W.2d 359, 363 (1998).
  47. See Emerson College v. City of Boston, 39 Mass. 415, 424, 462 N.E.2d 1098, 1105 (1984).
  48. See Hukle v. City of Huntington, 134 W.Va. 249, 58 S.E.2d 780, 783 (1950).
  49. See Emerson College, Id.
  50. After all, staff and the Board label the RFF/BFF, in part, “Recreation…Service Charges” (see pages 228 and 232-233 of the 5/26/2022 Board packet).
  51. See page 190 of the 5/26/2022 Board packet.
  52. But a “special benefit” is one particular to the payer rather than to the general public as a whole [see Silicon Valley Taxpayers Ass’n., Inc. (SVTA) v. Santa Clara County Open Space Authority, 44 Cal.4th 431, 441-442, 187 P.3d 37, 44-45 (2008)]. Here the alleged special benefit furnished is to the general public as a whole.
  53. See ¶4 of that resolution at page 229 and pages 232-233 of the 5/26/2022 Board packet.
  54. Because user fees are charged at most of the District’s public recreation facilities [see ¶104(b) of Ordinance 7].
  55. See ¶I at page 234 of the 5/26/2022 Board packet.
  56. See McMillan, supra, at 983 S.W.2d 365.
  57. See Emerson College, supra, at 391 Mass. 424; State v. Medeiros, 89 Haw. 361, 973 P.2d 736, 741 (1999); Clean Water Coalition v. The M Resort, LLC, 127 Nev. 301, 315, 255 P.3d 247 (2011).
  58. See our What Powers May GIDs Exercise discussion.
  59. Besides its public parks and athletic fields, other examples include: its disc golf course, skateboard park, mountain bike pump track, fitness track, beach overflow parking lot, The Grille Restaurant or the restaurant at the Mountain Golf Course, the Championship or Mountain Golf Course pro shops, and other miscellaneous lesser venues.
  60. See pages 127 and 129 of the packet of materials prepared by staff in anticipation of the Board’s March 3, 2016 special meeting (“the 3/3/2016 Board packet”).
  61. The Board livestreams its meetings (see http://new.livestream.com/accounts/3411104). The portion of the Board’s March 3, 2016 meeting (“the 3/3/2016 livestream”) where Mr. Eick gave the testimony represented can be viewed at 29:24-29:38 of the 3/3/2016 livestream.
  62. This distinction is noteworthy given according to staff and previous boards, the RFF/BFF allegedly represent standby services charges for the “availability of use of the recreational facilities (more particularly) described” in the Report the Board adopts each year1 pursuant to NRS 318.201(9).
  63. See the latin maxim expressio unius est exclusio alterius which means that “where a…statute specifies certain things, the designation of such things excludes all others” [see Local 1494 of Int’l Ass’n of Firefighters v. City of Coeur d’Alene, 99 Idaho 630, 639, 586 P.2d 1346, 1355 (1978)]. Thus, if a statute…mentions certain things specifically, the list is exclusive.”
  64. Such as Diamond Peak, the District’s two golf courses, the District’s tennis/pickleball center, the Recreation Center, The Chateau and Aspen Grove.
  65. As we’ve elsewhere discussed.
  66. Hence the words “service…and standby service charges” [see State v. City of Port Orange, 650 So.2d 1, 3 (1994); Chapman v. City of Albuquerque, 65 N.M. 228, 335 P.2d 558, 561 (1959)] in NRS 318.197(1).
  67. See the latin maxim expressio unius est exclusio alterius which means that “where a…statute specifies certain things, the designation of such things excludes all others” [see Local 1494 of Int’l Ass’n of Firefighters v. City of Coeur d’Alene, 99 Idaho 630, 639, 586 P.2d 1346, 1355 (1978)]. Thus, where “a statute…mentions certain things specifically, the list is exclusive.”
  68. See Medeiros, supra, at 973 P.2d 742.
  69. See Washoe County Bill No. 117 amending Ordinance No. 97 adopted November 15, 1965.
  70. In other words, the necessary alleged special benefit.
  71. See NRS 318.201(11) which states “the county treasurer shall include the amount of the charges on bills for taxes levied against the respective lots and parcels of land. Thereafter, the amount of the charges shall be collected at the same time and in the same manner and by the same persons as, together with and not separately from, the general taxes for the county.”
  72. Such as one which, “presumably, bestows a benefit on the applicant, not shared by other members of society,“ like “a request that a public agency permit an applicant to practice law or medicine. Or construct a house. Or run a broadcast station” [see National Cable Television Assn. v. U.S., 415 U.S. 336, 340-41, 94 S.Ct. 1146 (1974)].
  73. See Kennedy v. City of Ukiah, 69 Cal.App.3d 545, 553, 138 Cal.Rptr. 207 (1977) and Kellerman v. Chowchilla Water Dist., 80 Cal.App.4th 1006, 1011, 96 Cal.Rptr. 246, 250-51 (2000).
  74. See Solvang Mun. Improvement Dist. v. Board of Supervisors, 112 Cal.App.3d 545, 552, 169 Cal.Rptr. 391 (1980).
  75. The last such letter staff published was dated May 23, 2018, and the reader can find it at pages 10-18 of the 2018-19 Budget. Once members of the public learned of this admission and publicized it as evidence the RFF/BFF are “taxes,” uncoincidentally, the admission ceased to exist.
  76. I.e., person or people.
  77. “Village Development Co., formerly known as Crystal Bay Development Co.”
  78. According to Mr. Navazio, “the Board is required to approve a resolution which outlines the billing and collection process set forth in Nevada Revised Statutes 318.197 (establishing standby service charges for services).”8
  79. Although NRS 318.197(1) permits GIDs to fix rates, tolls or charges for various facilities and services, those exactions are “other than special assessments.” Given the BFF cannot be an “assessment,” it is not the type of monetary exaction permitted by law or the beach deed.
  80. According to the beach deed, the only persons entitled to beach access are those owners of real property located within the physical boundaries of IVGID on the date the beaches were deeded to the District, or their successors in title, and their tenants and guests. This deed restriction makes the beaches private as to them.
  81. As it was for the Burnt Cedar Pool, and the Incline Beach restrooms, and according to staff it will be used for the Beach House, boat launch ramp, and who knows how many other projects to come.
  82. Medeiros, supra, at 973 P.2d 741.
  83. See Vanceburg v. Federal Energy Regulatory Comm’n, 571 F.2d 630, 644 fn. 48 (D.C.Cir. 1977), cert. denied, 439 U.S. 818, 99 S. Ct. 79 (1978); Medeiros, supra, at 973 P.2d 741.
  84. See Nuclear Metal v. Low Level Radioactive Waste Mgmt. Bd., 421 Mass. 196, 656 N.E.2d 563, 570 (1995); Clean Water Coalition, supra, at 255 Pd.3d 258.
  85. In other words, where special benefit services affecting public health and sanitation are physically connected, adjacent or capable of actual connection to those real properties which are involuntarily assessed.
  86. By way of example, see pages 230-231 of the 5/26/2022 Board packet.
  87. A test embraced by the Nevada Supreme Court, no less, in Clean Water Coalition, supra, at 127 Nev. 315.
  88. As aforesaid, the Board has adopted a “Recreation Roll Policy” (see ¶1.0 of Policy No. 16.1.1) which instructs that “the Incline Village General Improvement District will charge the prescribed Recreation Fee, and if applicable…Beach Fee, to all qualifying real properties.
  89. After all, “the Board shall prescribe and enforce regulations for the connection with and the disconnection from properties of the facilities of the District and the taking of its services.”
  90. See Forest Hills Util. Co. v. Pub. Util. Com’n., 31 Ohio.St.2d 46, 57, 285 N.E.2d 702, 709 (1972); Smith v. Township of Norton, 2 Mich.App. 17, 18-19, 138 N.W.2d 522, 525 (1965).
  91. See Chapman, supra, at 335 P. 564.
  92. As stated elsewhere.
  93. See McMillan v. Texas National Resources Conservation Comm’n, 983 S.W.2d 359, 365 (1998).
  94. See City of Ukiah, supra.
  95. ¶104(b) of Ordinance 7 instructs that user fees are charged at District owned recreation facilities, and PPHs receive “discounts for daily access.” ¶4(b) of the resolution the Board passes each year which adopts the RFF/BFF and orders their collection on the county tax roll instructs that PPHs receive “reduced rates for season passes and reduced daily rates” (see page 230 of the 5/26/2022 Board packet). Thus in addition to their assessed properties’ RFF/BFF, PPHs and punch card holders are required to pay additional user fees
  96. See Graham v. City of Lakewood Village, 796 S.W.2d 800, 801 (1990).
  97. “The availability of the use of IVGID’s (recreation facilities is a)…benefit…which inure(s) to the owners of properties assessed hereunder.”
  98. The equivalent of Costco or Sam’s Club membership cards.
  99. See National Cable Television Ass’n, Inc. v. F.C.C., 554 F.2d 1094, 1106 (D.C. Cir. 1976); Emerson College, supra, at 391 Mass. 424.
  100. Emerson College, supra, at 391 Mass. 424-25.
  101. As elsewhere stated.
  102. In other words it is greater than the costs of providing a service.
  103. See Douglas Co. Contractors v. Douglas Co., 112 Nev. 1452, 1457, 929 P.2d 253, 256 (1996); Clean Water Coalition, supra, at 255 P.3d 258.
  104. That is, the amount of charges necessary to subsidize.
  105. See pages 224-225 of the 5/26/2022 Board packet.
  106. See ¶3 at page 229 of the 5/26/2022 Board packet.
  107. See page 225 of the 5/26/2022 Board packet.
  108. If not the difference between budgeted revenues and intentional overspending, please explain to us exactly what other types of overspending are not encompassed within: “debt, capital expenditure(s) and operations (required) for the District’s various recreation and beach facilities;”93 and, “required for the…proper servicing of said identified bonds and…the administration, operation, maintenance and improvement of said real properties, equipment and facilities” (see ¶II at page 235 of the 5/26/2022 Board packet).
  109. I.e., a “slush fund” which can be used by staff to spend on unbudgeted, unappropriated, and unidentified “pet” endeavors.
  110. See Executive Aircraft Consulting, Inc. v. City of Newton, 252 Kan. 421, 845 P.2d 57, 62 (1993) [quoting National Cable Television Ass’n, Inc. v. F.C.C., 554 F.2d 1094, 1106 (D.C. Cir. 1976)].
  111. Fund balance represents “the residual difference between assets and other inflows and liabilities and other outflows…for budget purposes” (see the District’s “Accounting Glossary“).
  112. See page 29 of the District’s 2016 Annual Comprehensive Financial Report (“the 2016 CAFR“).
  113. See page 30 of the 2016 CAFR.
  114. See page 56 of the District’s 2022 CAFR (“the 2022 CAFR“).
  115. See page 57 of the 2022 CAFR.
  116. See Clean Water Coalition, supra, at 127 Nev. 315; Douglas Co. Contractors, supra, at 112 Nev. 1457, 929 P.2d 256; State ex rel. City of Reno v. Boyd, 27 Nev. 249, 256, 74 P. 654, 655 (1903); 71 Am. Jur. 2d  §13, State and Local Taxation (2001).
  117. See page 606 of the packet of materials prepared by staff in anticipation of the board’s March 8, 2023 meeting (“the 3/8/2023 Board packet“) – “rates charged for…Picture Pass Holders the (are less than)…the fully-loaded cost per round of golf (because)…the discounts afforded to residents and guests recognize that facility fees are assessed…specifically to cover costs of capital and debt associated with District venues.”
  118. In other words, “if those criteria (do not) fit the charge, it is a” tax (see Medeiros, supra, at 973 P.2d 742-745; Clean Water Coalition, supra, at 255 P.3d 257.
  119. See Commonwealth v. Caldwell, 25 Mass. App. Ct. 91, 94-95 (1987).
  120. See Emerson College, supra, at 39 Mass. 425.
  121. See Emerson College, supra, at 39 Mass.425-26.
  122. See Emerson College, supra, at 39 Mass. 426.
  123. See Emerson College, supra, at 39 Mass. 417-419; National Cable Television, supra, at 554 F.2d 1106-1107; Utah Office of Property Rights Ombudsman, Advisory Opinion #101, supra, at page 9 of 9.
  124. Remember, IVGID attorney Bob McDonald was a founding partner in the powerhouse McDonald Carano law firm, a principal in Crystal Bay Development Co. (“CBDC”), one of the IVGID Board’s initial trustees, and President of the homeowners association set up by CBDC to own and operate the beaches for the benefit of all local parcel owners.

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