By Jamie Hadden

March 5, 2021

On the 19th of January of this year, Nevada Governor Steve Sisolak delivered his State of the State address. Of particular note was his endorsement of draft legislation which would authorize the creation of so-called Innovation Zones within the state. The legislation is described as a means of attracting new technology investments and creating jobs, without utilizing the traditional method of incentive tax breaks. However, the importance and impact of this legislation would be far greater than simply growing the technology economy of the state – rather, this legislation represents a profound new system for managing county-level governmental structures within the state, with significant potential opportunities and risks. This legislation warrants our serious attention.

The draft legislation defines a process through which the owners of privately-held land within any of the sixteen counties of Nevada can unilaterally secede from their current county and form a new county, governed by a board with majority-control by the landholding company. The legislation does require that development within these new counties be aimed towards certain technology innovation, but the obligation to pursue tech innovation pales in comparison to the importance of the establishment of a novel process for the creation of new, privately-owned and privately-governed counties. As these counties grow and mature, the legislation facilitates the implementation of their own county-level schools, courts, taxation, law enforcement, elections, etc. In short, these private landholdings will become real counties, and the number of counties within Nevada will increase to seventeen, then eighteen, then higher.

Importantly for Washoe County residents, the first entity seeking to utilize this legislation to create their own county has chosen the adjacent Storey County as their foothold. Blockchains LLC has purchased 67,000 acres in the Tahoe Reno Industrial Center just east of Sparks. The development envisioned by Blockchains LLC, and its residents, would be our new neighbors.

To our knowledge, no similarly well-defined process for spawning new, privately-owned counties exists anywhere else in the nation. This idea is as novel and revolutionary as the Seasteading project – a vision for a proliferation of diverse start-up nations freed from geographic constraints by residing on large ships at sea. In this case, however, Nevada is welcoming people with the same spirit for self-governance to drop anchor in the sands of Nevada. Perhaps the Innovation Zone Bill would best be re-titled as the Sandsteading Bill.

One can imagine a future where the Great Basin of Nevada, once largely empty save for mines and small towns, is now dotted with growing metropolises, modern and clean. High-tech energy, utility and transportation systems connect the cities, and facilitate an enviously-high standard of living for their residents. Well-paying construction and support jobs attract labor from around the state and the nation, and the overall economy and tax-base of the state grows rapidly. County borders are fluid, as successful “Innovation Zones” expand, and underperforming zones are bought out and revitalized. Comparisons to Dubai abound, and Nevada is dubbed the “Miracle of the West.” Other states play catch-up by introducing their own similar legislation.

One can also imagine a future of failed early-stage construction efforts, real-estate scams, water shortages, and groans about a new crop of people displacing the Nevada we once loved and the Nevadans we once were. This proposal is not without risk. Some voices on the left have gone so far as to describe the proposal as enabling neo-feudalism – their concerns should be heard and accounted for in the detailed implementation of any such bill. We should, however, note that these novel counties and the activities within them would still be subject to all constraints and obligations borne by existing counties, including the Constitution of the State of Nevada, the Constitution of the United States of America, and all applicable local, state and federal law.

Technology innovation offers extraordinary opportunity as well as risk. Political innovation even more so. The Innovation Zone proposal is the most innovative legislation currently on the table in our state. What better place than Nevada – the freest state in the West – to experiment with innovations in local governance. Let’s give it a try.

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