Once a bill lands on the governor’s desk, the countdown begins. Governor Joe Lombardo has a limited window to sign or veto bills sent by the Legislature. His task is a big one as it will impact the political landscape in Nevada and the very lives of the Nevadans reading this article.

The Non-Political Guide to Gov. Lombardo’s Veto on Rent Control

Lombardo’s office revealed that 536 of the 611 bills were signed, while 75 faced the governor’s veto—setting an all-time record for vetoes in a single session.

These vetoes impact Nevadans’ everyday lives and knowing about them can better prepare you for participating in the democratic process.   This article is a non-political guide to understanding the governor’s veto of Senate Bill 275 (SB275). It aims to empower you with the information needed to make informed decisions and act.

Find out how below!

But first, let’s learn about SB275, why the governor vetoed the bill, and how it could impact you and your family.

History of SB275

SB275 aimed to implement rent control measures in manufactured home parks, limiting annual rent increases and protecting tenants from excessive hikes. The bill required the Housing Division of the Department of Business and Industry to calculate maximum rent increase percentages annually and allowed landlords to apply for exemptions under certain circumstances.

The bill, championed by Democratic state Senator Skip Daly, sought to address rising concerns over housing affordability and protect vulnerable residents from skyrocketing rents. However, housing affordability includes what every business should consist of, supply and demand. Therefore, it’s not so simple, Skip.

Why Gov. Lombardo Vetoed Rent Control Bill

Gov. Lombardo’s decision to veto SB275 was driven by concerns over the bill’s potential economic impact. He argued that rent control measures could lead to housing shortages, reduced property maintenance, and decreased property tax revenue for local governments. Lombardo emphasized the need for solutions that expand housing supply rather than distort market dynamics.

Consider a hypothetical scenario where a manufactured home park owner, faced with rent control regulations under SB275, decides to halt further property maintenance and improvement investments. Without the ability to increase rent to cover rising maintenance costs or generate profits, the owner may find it financially unsustainable to continue investing in the park’s upkeep.

As a result, essential maintenance tasks such as repairing infrastructure, upgrading amenities, or addressing safety concerns could be neglected. Over time, the deteriorating conditions of the park could lead to decreased property values and diminished quality of life for residents.

Furthermore, if the park’s condition deteriorates significantly, potential investors or developers may be deterred from acquiring or investing in the property, fearing the financial burdens imposed by rent control regulations. This reluctance to invest in or develop manufactured home parks could exacerbate housing shortages, limiting affordable housing options.

Increasing Affordable Housing in Nevada

By vetoing SB275 and emphasizing the importance of solutions that promote housing supply expansion, Gov. Lombardo aims to prevent such adverse outcomes and ensure the long-term viability of housing markets in Nevada.

The veto of SB275 echoes broader debates over housing affordability and market regulation, drawing parallels to past policies in Nevada.

For example, in the early 2000s, Nevada experienced a significant housing boom driven by lax lending practices and speculative investment. During this period, the state saw a surge in housing construction and skyrocketing property values, leading to concerns over residents’ housing affordability.

In response to these concerns, policymakers implemented various regulatory measures to curb speculative activities and promote sustainable growth. However, some of these policies inadvertently contributed to the housing market downturn during the 2008 financial crisis.

One policy even imposed strict lending standards and regulations, restricting access to mortgage financing for many potential homebuyers. While intended to prevent reckless lending practices, these regulations also limited access to credit for creditworthy borrowers, exacerbating the housing affordability crisis.

Short Term Gain, Long Term Harm

Similarly, the veto of SB275 reflects the ongoing debate over the effectiveness of rent control as a solution to housing affordability challenges. While proponents argue that rent control can provide immediate relief to tenants facing rising rents, we must raise concerns about its long-term impacts on housing supply, property maintenance, and market dynamics.

By vetoing SB275, Governor Lombardo signals a commitment to addressing housing affordability issues through policies that promote sustainable growth and expand housing supply rather than through market-distorting regulations. This decision underscores the complexity of balancing affordability concerns with the need for market-driven solutions that support long-term housing stability and economic growth in Nevada.

While well-intentioned, rent control measures like SB275 may do more harm than good in the long run. You must consider the broader economic implications of such policies and advocate for solutions that promote sustainable housing growth.

Let Your Voice Be Heard

We urge you to support the governor’s decision and voice your concerns to elected officials through Nevada Policy’s Action Center.

Together, we can ensure that policies reflect sound economic principles and serve the best interests of all Nevadans.