The CEO of the Southern Nevada Home Builders Association told commercial real estate professionals that making more federal land available for development is the group’s No. 1 priority and how there’s more optimism than ever that something will get done.
Tina Frias spoke Wednesday to the Southern Nevada chapter of CCIM outlining bipartisan efforts led by Nevada Sen. Catherine Cortez Masto that allows Clark County to develop 25,000 acres of federal land for affordable housing and business growth while setting aside 2 million acres for conservation.
Frias also talked about how the Trump Administration has a joint federal task force on land specifically for housing where it will be looking at Western states for allocating land.
Frias highlighted failed attempts by Rep. Mark Amodei of Northern Nevada as part of an amendment in the budget reconciliation bill working its way through Congress at this time included a controversial amendment to sell off more than 65,000 acres of public lands in Nevada to use for affordable housing.
“I can tell you there’s a little bit of a different perspective on Amodei’s amendment,” Frias said. “It currently preserves the current (Southern Nevada Public Land Management Act) money as well as the boundaries in the Sen. Cortez Masto bill. However, he identified additional parcels on the outer parts of Southern Nevada in which those sales would go to the U.S. Treasury to fund the federal budget. That amendment has died, and we’re currently going through the reconciliation process at the federal level.”
Frias outlined a proposed amendment from Utah Sen. Mike Lee that would have also enabled the sale of federal land across the Western states for housing. There were legal concerns raised about that being in the bill because it’s supposed to be about the budget, Frias added, and subsequently Lee withdrew it Saturday night.
The debate, meanwhile, over Western lands appears to be building momentum for something to happen in the future making more land available for development, Frias said.
“From the folks that have been involved in federal lands in the state for 30-plus years and are part of my membership, they said this is the most momentum they have seen on a lands package ever,” Frias said. “I’ll tell you in my opinion I’m both excited but also nervous because I think we will see something come to fruition.”
Frias said her understanding from the Bureau of Land Management is that the Trump Administration proposal gives the joint task force the ability to identify those lands without an act of Congress. However, the process can be so cumbersome it would not be as efficient as they would like so they would prefer to have a congressional vehicle to do that, Frias noted.
“I do think with this much momentum and this much attention, particularly in the case of housing with people hurting, it’s all going to come down to public perception,” Frias said. “I think they are going to move something, but my nerves are about what that means for the state of Nevada. Nevadans are interested in the formula (that keeps land sales money in the state), but it’s not well liked anywhere else. We just have to understand what that means at some point if it no longer becomes an option for us.”
In talking about the Nevada legislative session, Frias said the stakes were high for the residential construction industry going into it. There was a lot of attention on housing with legislators saying it was their No. 1 issue.
“Going into the session we knew what the risks were because we also understand that oftentimes when you talk about housing attainability there are some concepts that would come up that could actually have the reverse effect and that is impacting our businesses in a negative manner.”
Inclusionary zoning and rent control would increase the cost of housing while prevailing wage expansion would do the same. Construction defect legislation was also monitored, Frias said.
“These were things we were watching closely, and I’ll tell you that (with) the governor’s housing bill we had two goals which was to make sure we wouldn’t have things that would be an impediment to us so we could get additional supply out to the market,” Frias said. “Our association wanted to take a new focus, and that has been our role in wanting to drive solutions. We’ve invested in this market and care about the community. We want to be part of a solution for the economic resilience of this community.”
Gov. Joe Lombardo’s Assembly Bill 540 allocates $250 million for attainable housing and expands the definition of those who qualify up to 150 percent of the area median income.
“Legislators quickly understood that we were facing a true supply-side challenge,” Frias said. “They understood that Nevadans were at a crossroads and many Nevadans that were priced out of homes and recognized that there’s a supply issue across the nation that is compounded in our state because of our land constraints.”
Frias said expanding the definition of who qualifies was important because while they recognize some of the most vulnerable populations are those at 80 percent or below the area median income, supporters of the bill also wanted to make sure they provide an incentive for teachers, police officers, nurses and first responders.
“That 150 percent gets us to that level where we are able to get supply out,” Frias said.
The legislation designated $133 million in state funding for other incentives for housing. Some $83 million would be used for land acquisitions, $25 million for essential worker homebuyers assistance and $25 million for local governments to increase supply.
“There was also money set aside for infrastructure projects at $50 million,” Frias said. “We are still working with the governor’s office on what those regulations will look like, but we’re hopeful we will be able to access that funding for redevelopment projects.”
The housing challenges in Nevada will take a multifaceted approach, Frias said. There are a lot of issues, and the housing bill is something they are proud to be a part of but we also “need to recognize there’s an elephant in the room and that’s the land constraints. That’s going to take coming together at the federal level and working collaboratively with our delegation. That will take continued leadership from the governor’s office and local government will play a key role in that as well.”
