Nevada Administrative Code Chapter 670A - Corporations for Economic Revitalization and
Nevada Administrative Code Chapter 670A — Corporations for Economic Revitalization
1. Overview
NAC Chapter 670A governs the formation, operation, and regulation of Corporations for Economic Revitalization (CERs) in Nevada. These corporations are specially created entities designed to stimulate economic growth, development, and revitalization within designated areas of the state.
The chapter sets forth requirements for certification, governance, and compliance, aiming to foster business development, job creation, and community improvement through partnerships between private and public sectors.
2. Purpose and Scope
Facilitate economic development by enabling the creation of corporations with specific revitalization missions.
Provide a legal framework for the organization and oversight of CERs.
Promote transparency, accountability, and effective use of resources by CERs.
Encourage private investment and cooperation with government entities to improve economic conditions.
This chapter applies to all CERs organized under Nevada law and any entities seeking such status.
3. Key Provisions of NAC Chapter 670A
A. Formation and Certification
Specifies the procedure for formation of CERs, including filing articles of incorporation.
Requires submission of a detailed economic revitalization plan demonstrating how the corporation will promote economic growth in targeted areas.
The Nevada Governor’s Office of Economic Development or other designated agency reviews and certifies the corporation’s plan.
Certification grants certain benefits and recognitions necessary for operation.
B. Governance and Management
CERs must maintain a board of directors and comply with corporate governance standards.
Board members may include public officials, private sector representatives, and community leaders.
The chapter outlines requirements for meetings, recordkeeping, and reporting.
CERs must adhere to transparency and ethical standards, including disclosure of conflicts of interest.
C. Powers and Duties
Authorized to enter into contracts, acquire property, receive grants or donations, and issue bonds or notes for revitalization projects.
May collaborate with government agencies, businesses, and nonprofits.
Charged with implementing projects aligned with their revitalization plans, such as infrastructure development, business incentives, or workforce training.
D. Reporting and Accountability
CERs must submit periodic reports on activities, finances, and progress toward revitalization goals.
Subject to audits or reviews by state agencies to ensure proper use of funds.
Required to maintain transparency with stakeholders, including the public.
E. Termination and Dissolution
Provides procedures for voluntary dissolution or revocation of certification if CERs fail to meet obligations.
Upon dissolution, assets are to be distributed according to state law and any applicable agreements.
4. Relevant Case Law and Legal Principles
Case 1: Authority to Create Special Purpose Entities
Courts have consistently upheld the state’s authority to create and regulate special purpose corporations like CERs to promote economic development.
The power is considered a legitimate exercise of the state’s police and economic development powers.
Case 2: Public-Private Partnership Validity
Case law supports the validity of partnerships between CERs and government entities.
Courts recognize that such arrangements can enhance economic revitalization without violating constitutional or statutory provisions.
Case 3: Transparency and Accountability Requirements
Legal challenges have underscored the importance of transparency in CER operations.
Courts require CERs to adhere to open meeting laws, financial disclosures, and ethical standards.
Case 4: Contractual and Fiscal Responsibilities
Courts have enforced CER contracts, grants, and bond obligations, emphasizing fiduciary duty and accountability.
Misuse of funds or breach of contract by CERs may lead to legal remedies and administrative sanctions.
Case 5: Dissolution and Asset Distribution
Courts have ruled on proper procedures for CER dissolution, including asset disposition consistent with public benefit purposes.
5. Legal and Regulatory Principles
Economic Development Authority: CERs represent a strategic tool for state-led economic revitalization.
Corporate Governance: CERs must observe standard governance norms adapted to public-private hybrid status.
Transparency: Open operations and disclosures are legally mandated to maintain public trust.
Accountability: CERs are accountable for effective and lawful use of resources.
Legal Standing: CERs have the capacity to enter contracts, hold property, and engage in business activities as statutory corporations.
6. Summary
NAC Chapter 670A provides a comprehensive framework for the creation and management of Corporations for Economic Revitalization in Nevada by:
Establishing certification and formation requirements.
Defining governance, powers, and responsibilities.
Ensuring accountability through reporting and oversight.
Providing mechanisms for dissolution and orderly wind-up.
This framework supports Nevada’s efforts to stimulate economic growth and community revitalization by leveraging specialized corporate entities to implement targeted projects.
RELATED Blog
0 comments