1. The governing body of a municipality, on behalf of the municipality and in its name, without an election, may create a district to finance one or more energy efficiency improvement projects or renewable energy projects:

(a) On qualifying commercial or industrial real property, which may include any real property other than:

(1) A residential dwelling that contains fewer than five individual dwelling units; or

(2) Property financed by a government-guaranteed financing program that prohibits the subordination of the government’s interest in the property or otherwise prohibits a contract under NRS 271.6312 to 271.6325, inclusive.

(b) That meet one of the following requirements:

(1) For an energy efficiency improvement project, the project must be determined to be appropriate through an energy audit conducted by a qualified service company. A project may be determined to be appropriate if:

(I) The energy audit includes a summary of recommendations, which for each recommendation must include existing and expected consumption and expected energy savings expressed in British thermal units, kilowatt-hours, and kilowatts, the expected annual energy savings, the cost, the payback period in years, the expected life cycle in years and the percentage of savings, as applicable; and

(II) The expected energy savings from the project exceeds the investment costs of the project.

(2) For a renewable energy project, the project must be determined to be feasible through a written feasibility study conducted by a qualified service company.

2. A bond or interim warrant issued for a district created pursuant to this section must not be secured by a pledge of the general credit or taxing power of the municipality or by the surplus and deficiency fund established pursuant to NRS 271.428.

3. The improvements to or installations within a district created pursuant to this section must not be owned by a municipality but shall be deemed to be the property of the owner of the tract upon which the improvement or installation is located.

4. The provisions of:

(a) NRS 271.275 to 271.365, inclusive, do not apply to a district which is created pursuant to this section.

(b) NRS 271.495 and 271.500 do not apply to any bonds or interim warrants issued to finance an energy efficiency improvement project or renewable energy project within a district created pursuant to this section.

5. As used in this section:

(a) “Energy audit” means a formal evaluation of the energy consumption of a permanent building or any structural improvement to real property that is consistent with the requirements of ASTM International Standard E2797, “Standard Practice for Building Energy Performance Assessment for a Building Involved in a Real Estate Transaction,” the ASHRAE Level 2 or 3 guidelines for energy audits or any comparable energy assessment guidelines.

(b) “Qualified service company” has the meaning ascribed to it in NRS 333A.060.

(Added to NRS by 2017, 1393)