STATE OF NEVADA

LEGISLATIVE COUNSEL BUREAU

LEGISLATIVE BUILDING

401 S. CARSON STREET

CARSON CITY, NEVADA 89701-4747

Fax No.: (775) 684-6600

RICK COMBS, Director

(775) 684-6800

LEGISLATIVE COMMISSION (775) 684-6800

MICHAEL ROBERSON, Senator, Chairman

Rick Combs, Director, Secretary

INTERIM FINANCE COMMITTEE (775) 684-6821

PAUL ANDERSON, Assemblyman. Chairman

Cindy Jones, Fiscal Analyst

Mark Krmpotic, Fiscal Analyst

BRENDA J. ERDOES, Legislative Counsel (775) 684-6830

PAUL V. TOWNSEND, Legislative Auditor (775) 684-6815

SUSAN E. SCHOLLEY, Research Director (775) 684-6825

September 11,2015

Senator Michael Roberson

P.O. Box 530940

Henderson, NV 89053-0940

Dear Senator Roberson:

Previously, you asked this office whether a local government may impose upon a

transportation network company, or any driver providing transportation services in

affiliation with a transportation network company, a tax, fee or any other requirement,

such as a background investigation or drug-testing requirement, that is not of general

applicability to any other business that operates within the jurisdiction of the local

government. In a letter dated August 24, 2015, this office stated its opinion that a local

government may not impose such a tax, fee or any other requirement unless it is generally

applicable to any other business that operates within the jurisdiction of the local

government.

Subsequent to the issuance of that letter on August 24, 2015, you have asked this

office to address two related questions. First, you have asked whether a local government

may impose a business license fee on a category that only includes a transportation

network company or a driver affiliated with such a company or which includes such a

company or driver within another specific category of business, but not to all businesses

generally. If such a special category is not allowed, you have asked whether a local

government may prevent a transportation network company or a driver affiliated with

such a company from engaging in business without a business license if the local

government does not have a business license fee that is applicable to all businesses within

its jurisdiction. As an addendum to this office's letter dated August 24, 2015, we will

address these additional questions; since a substantial portion the rationale for our

opinion was stated in the previous letter, we will only briefly refer back to our previous

discussion rather than restating the rationale in full.

Generally, local governments may "fix, impose and collect for revenues or for

regulation, or both, a license tax on all character of lawful trades, callings, industries,

(NSPO Rev. 7-15) (O) 1578E

Senator Roberson

September 11,2015

Page 2

occupations, professions and businesses conducted within" their jurisdiction. NRS

244.335, 268.095. However, as discussed in our previous letter, during the 78th Session of

the Nevada Legislature, the Legislature created a system for the comprehensive

regulation of transportation network companies by the State through the Nevada

Transportation Authority. Section 44 of Assembly Bill No. 176 (2015) specifically

delineated the authority of local governments with respect to transportation network

companies, providing:

1. Except as otherwise provided in subsection 2, a local

governmental entity shall not:

(a) Impose any tax or fee on a transportation network company

operating within the scope of a valid permit issued by the Authority

pursuant to this chapter, a driver who has entered into an agreement

with such a company or a vehicle operated by such a driver or for

transportation services provided by such a driver.

(b) Require a transportation network company operating within

the scope of a valid permit issued by the Authority pursuant to this

chapter to obtain from the local government any certificate, license or

permit to operate within that scope or require a driver who has entered

into an agreement with such a company to obtain from the local

government any certificate, license or permit to provide transportation

services.

(c) Impose any other requirement upon a transportation network

company or a driver which is not of general applicability to all persons

who operate a motor vehicle within the jurisdiction of the local

government.

2. Nothing in this section:

(a) Prohibits a local governmental entity from requiring a

transportation network company or driver to obtain from the local

government a business license or to pay any business license fee in the

same manner that is generally applicable to any other business that

operates within the jurisdiction of the local government.

(b) Prohibits an airport or its governing body from requiring a

transportation network company or a driver to:

(1) Obtain a permit or certification to operate at the airport;

(2) Pay a fee to operate at the airport; or

(3) Comply with any other requirement to operate at the

airport.

(c) Exempts a vehicle operated by a driver from any tax imposed

pursuant to NRS 354.705, 371.043 or 371.045.

3. The provisions of this chapter do not exempt any person from

the requirement to obtain a state business license issued pursuant to

chapter 76 ofNRS. A transportation network company shall notify

each driver of the requirement to obtain a state business license issued

Senator Roberson

September 11,2015

Page 3

pursuant to chapter 76 ofNRS and the penalties for failing to obtain a

state business license.

Section 44, chapter 279, Statutes ofNevada 2015, at p. 1409 (emphasis added). In

pertinent part and with certain enumerated exceptions, this section prohibits a local

government from imposing a tax or fee upon a transportation network company or a

driver affiliated with the company or requiring such a company or driver to obtain a

certificate, license or permit from the local government to engage in activities within the

scope of the permit received from the Nevada Transportation Authority. Subsection 2 of

section 44 of A.B. 176 provides the pertinent exception to that rule by expressly allowing

a local government to require a transportation network company or driver to obtain a

business license from, and pay a business license fee to, the local government in the same

manner as any other business within the jurisdiction of the local government.

The controlling factor in statutory interpretation is the intent of the Legislature.

County of Clark ex rel. Univ. Med. Ctr. v. Upchurch. 114Nev. 749, 753 (1998);

Cleghorn v. Hess. 109 Nev. 544, 548 (1993). "To determine legislative intent, [a] court

first looks at the plain language of a statute." Allstate Ins. Co. v. Fackett. 125 Nev. 132,

138 (2009); Salas v. Allstate Rent-A-Car. Inc.. 116 Nev. 1165, 1168 (2000). A court will

apply the plain meaning of the statutory language as written, unless such a meaning

violates the spirit of the act or leads to an absurd or unreasonable result. Redl v. Heller,

120 Nev. 75, 78 (2004); Anthony Lee R. v. State. 113 Nev. 1406, 1414 (1997); McKay v.

Bd.ofSuperv'rs. 102 Nev. 644, 648 (1986). "It is an accepted rule of statutory

construction that a provision which specifically applies to a given situation will take

precedence over one that applies only generally." Nev. Power Co. v. Haggerty. 115 Nev.

353, 364 (1999); Sierra Life Ins. Co. v. Rottman. 95 Nev. 654, 656 (1979).

While a local government generally has broad discretion to impose business

license fees upon businesses within its jurisdiction, the Legislature chose to specifically

curtail this discretion with respect to transportation network companies with the

enactment of A.B. 176. The plain language of section 44 of A.B. 176 limits the power of

a local government with respect to a transportation network company and any driver

affiliated with such a company. A.B. 176 only authorizes a local government to require a

business license and collect a business license fee from a transportation network company

or driver to the extent that it imposes the same general fee and requirements that apply to

all other businesses within the local government's jurisdiction. Subsection 1 of section 44

of A.B. 176 prohibits a local government from imposing an industry-specific business

license fee, and subsection 2 allows only the imposition of the same general business

license fee imposed upon all other businesses within the jurisdiction of the local

government. It is the opinion of this office that a local government may not impose

anything more.

The plain language of section 44 of A.B. 176 does not require a local government

to impose a general business license fee. In addition, A.B. 176 does nott prohibit the

Senator Roberson

September 11,2015

Page 4

imposition of industry-specific business license fees to other types of businesses.

However, with respect to a transportation network company or its affiliated drivers, it is

the opinion of this office that such a business license or fee may only be required to the

extent required of all businesses within the jurisdiction of the local government. It is the

understanding of this office that some local governments in this State either do not

impose a general business license fee or impose only a nominal application fee for a

business license, but also impose an industry-specific business license fee. However, it is

the opinion of this office that applying the plain language of section 44 of A.B. 176, such

a local government may not impose such an industry-specific business license fee upon a

transportation network company or its affiliated drivers. Rather, only a fee that is

"generally applicable to any other business that operates within the jurisdiction of the

local government" may be required of such a company or driver.

Next we consider whether a local government may prevent a transportation

network company or a driver affiliated with such a company from engaging in business

without a business license if the local government does not have a business license fee

that is applicable to all businesses within its jurisdiction. As discussed above, section 44

of A.B. 176 limits the power of local governments to regulate and tax transportation

network companies and their affiliated drivers. While a local government generally

enjoys broad discretion to regulate and tax businesses within its jurisdiction, section 44 of

A.B. 176 specifically curtailed the authority of local governments with respect to

transportation network companies, allowing only the imposition of a requirement for a

business license and the payment of a business license fee that applies to all other

businesses in the jurisdiction. Section 44, chapter 279, Statutes ofNevada 2015, at p.

1409. Section 44 expressly prohibits a local government from imposing any special

requirement on transportation network companies for the issuance of a business license or

imposing an industry-specific business license fee.

In addition, as discussed in our letter dated August 24, 2015, it is the opinion of

our office that local regulation of transportation network companies and their affiliated

drivers is preempted by state law. With A.B. 176, the Legislature has "carefully

plan[ned]" to achieve the objective of regulating the provision of transportation services

by transportation network companies and their affiliated drivers "within a statutory

scheme structured to occupy the entire field on the subject." Douglas County Contractors

Ass'n v. Douglas County. 112 Nev. 1452, 1465 (1996). The intent of the Legislature to

occupy the entire field is evident from the statutory scheme created by A.B. 176 which

provides for the comprehensive regulation of transportation network companies without

requiring the involvement of local governments. In addition, it expressly prohibits the

involvement and curtails general powers of local governments that would otherwise

apply to transportation network companies. Further, a local regulation which allows an

activity that state law prohibits directly conflicts with state law and will be preempted by

state law. See Crowlev v. Duffrin. 109 Nev. 597, 604-05 (1993); Lamb v. Mirin. 90 Nev.

329, 333 (1974). Since section 44 of A.B. 176 prohibits a local government from

imposing a tax, fee or other requirement upon a transportation network company or its

Senator Roberson

September 11,2015

Page 5

affiliated drivers which is not generally applicable to any other business within its

jurisdiction. Any local regulation or ordinance which purports to impose such a tax, fee

or requirement directly conflicts with state law and is therefore preempted. Therefore, it

is the opinion of this office that a local government that does not have a generally

applicable business license may not prevent a transportation network company or a driver

affiliated with such a company from engaging in business within the jurisdiction.

CONCLUSION

Assembly Bill No. 176 provides for the regulation of transportation network

companies by the State and expressly prohibits local governments from exercising

powers relating to the imposition of taxes, fees or requirements on transportation network

companies that are not of general applicability to all other businesses within the

jurisdiction of the local government. For these reasons, it is the opinion of this office that

a local government may only impose upon a transportation network company, or any

driver providing transportation services in affiliation with a transportation network

company, a tax, fee or requirement which is generally applicable to any other business

that operates within the jurisdiction of the local government. If a local government

chooses to rely upon industry-specific business license fees and imposes no general

business license fee, it is the opinion of this office that A.B. 176 prohibits the imposition

of an industry-specific fee as a prerequisite for the issuance of a business license to a

transportation network company or its affiliated drivers. Further, it is the opinion of this

office that, if a transportation network company has completed all of the requirements to

obtain a business license from a local government which are of general applicability to all

businesses within its jurisdiction, the local government may not withhold issuance of a

business license to the company.

If you have any further questions regarding this matter, please do not hesitate to

contact this office.

Sincerely,

Brenda J. Erdoes

Legislative Counsel

Asher A. Killian

Senior Deputy Legislative Counsel

Risa

Chief Deputy Legislative Counsel