MINUTES OF MEETING

ASSEMBLY COMMITTEE ON COMMERCE

Sixty-seventh Session

March 15, 1993

The Assembly Committee on Commerce was called to order by Chairman Gene T. Porter at 3:40 p.m., Monday, March 15, 1993, in Room 332 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda, Exhibit B is the Attendance Roster.

COMMITTEE MEMBERS PRESENT:

Mr. Gene T. Porter, Chairman

Mr. Morse Arberry, Jr., Vice Chairman

Ms. Kathy M. Augustine

Mr. Rick C. Bennett

Mr. John Bonaventura

Mr. Val Z. Garner

Ms. Chris Giunchigliani

Mr. Dean A. Heller

Mr. David E. Humke

Ms. Erin Kenny

Mr. Richard Perkins

Mr. Scott Scherer

Ms. Myrna T. Williams

COMMITTEE MEMBERS ABSENT:

None

GUEST LEGISLATORS PRESENT:

None

STAFF MEMBERS PRESENT:

Paul Mouritsen, Senior Staff Analyst, Legislative Counsel Bureau

OTHERS PRESENT:

Henry Etchemendy, Executive Director, Nevada Association of School Boards; Carolyne Edwards, legislative representative for the Clark County School District; Jack Jeffrey, Southern Nevada Building and Construction Trades Council; Brian Hutchins, Deputy Attorney General, counsel for the Department of Transportation; Jan Christopherson, Acting Administrative Services Officer, Department of Transportation; Gloria Armendariz, Executive Director, Nevada State Board of Architecture; Ted Fuetsch, Chairman, Nevada State Board of Architecture; Mona Joplin; Stephanie Tyler, Legislative Coalition of Interior Designers; Bruce Goff, Chairman of the Legislative Coalitiion of Interior Designers; See also Exhibit B attached hereto.

ASSEMBLY BILL 162 Revises provisions for establishing eligibility for preference given to local contractors for public works projects.

Mr. Henry Etchemendy, Executive Director, Nevada Association of School Boards, testified. He advised AB 162 resulted from a bill draft request made by the association. He stated, under present law, contractors who submitted bids for public works projects had to provide proof of timely payment of certain taxes each time they submitted a bid. He explained this requirement generated a great deal of paperwork both for a bidder, who might submit numerous bids in a short period of time, and for a public entity taking bids for many public works projects. Mr. Etchemendy directed attention to lines 25 and 26 on page 1 and lines 1 and 2 on page 2 of AB 162. He pointed out this provision would relieve a contractor of the requirement to provide proof of payment of taxes when submitting a bid if, within the previous 6 months, he had submitted such proof to the public body taking the bid.

Mr. Etchemendy stated a meeting was held by individuals representing various interests concerned about AB 162. He said the parties agreed the 6 month period specified in AB 162, on page 2, lines 1 and 35, should be changed to 3 months. He advised the reason for such change was to conform the procedure set forth in AB 162 to provisions of the NRS which governed business activities tax. He indicated those statutes required quarterly reporting of business activities and settlement of activities' taxes.

Chairman Porter advised Mr. Etchemendy the Nevada Department of Transportation (NDOT) had requested a bill which specified a time period of once a year and asked Mr. Etchemendy's position regarding that time period. Mr. Etchemendy replied a one year time period would work well as it would require a bidder to submit his proof of payment of taxes less often and would reduce the time spent by a public entity in reviewing such paperwork.

Chairman Porter asked how difficult it was to submit proof of payment of taxes. Carolyne Edwards, legislative representative for the Clark County School District, responded the paperwork involved in presenting such proof was massive.

Ms. Edwards indicated she was present at the meeting Mr. Etchemendy discussed. She stated 12 to 14 individuals were present, and the best compromise which could be reached concerning the time period specified in AB 162 was quarterly.

Jack Jeffrey, Southern Nevada Building and Construction Trades Council, testified. He advised the council would prefer quarterly to annual reporting. He stated he believed a one year time period would cause complications. Mr. Jeffrey advised most NDOT public works projects were federally funded, and for that reason, the 5 percent bid preference did not apply.

Ms. Giunchigliani asked what information bidders were required to provide in addition to tax information. Mr. Jeffrey replied no other information was required. Ms. Giunchigliani expressed the hope contractors from other states who bid on Nevada public works projects would be required to meet the same standards as Nevada contractors. Mr. Jeffrey stated Nevada's bid preference law was based solely on payment of taxes, and there were no other criteria unless set forth in other sections of the NRS for other purposes.

Mr. Brian Hutchins, Deputy Attorney General, counsel for the Nevada Department of Transportation, introduced Jan Christopherson, Acting Administrative Services Officer, Nevada Department of Transportation. Mr. Hutchins stated he was not certain the bill draft requested by NDOT was in conflict with AB 162. He explained the bill requested by NDOT would increase the time to submit qualification for bidder preference to one year. He advised the bill would specify such time provision could be allowed by a public body which already had a prequalification program. He said NDOT was one of the few public agencies, perhaps the only, which had a prequalification program. He explained the prequalification program required any contractor wishing to bid on NDOT contracts to submit, on an annual basis, extensive documentation to prove he qualified. He said the documentation must include proof the contractor was licensed, had the necessary bonding capacity, and had the ability to perform the contract. He said the purpose of NDOT's bill draft was to consolidate the functions of the bidder preference qualification and the existing prequalification. He advised AB 162 did not address a prequalification process but simply limited the requirement for bidder preference qualification. He stated bidder preference qualification covered the 5 year period immediately preceding a bid. He suggested if bidder preference qualification was limited only as to annual prequalification there would be small risk of missed information.

Jan Christopherson testified. She said the documentation contractors were required to provide NDOT each bid-opening day, which for state-funded projects was each Thursday, was voluminous. She said the department must review such documentation to ascertain invoice dates covered the preceding 5 years, invoices were for materials used on construction, and taxes for each year totalled $5,000. She declared the task was overwhelming. She stated NDOT let approximately 65 contracts each year, 1/2 of which were state-funded.

Mr. Hutchins advised NDOT probably let more contracts than any other governmental body.

Chairman Porter closed the hearing on AB 162 and assigned AB 162 to Mr. Perkins as a subcommittee of one. Chairman Porter requested Mr. Perkins report to the committee within 10 days.

ASSEMBLY BILL 311 Makes various changes relating to architecture.

ASSEMBLY BILL 234Revises penalty for first violation and increases penalty for second or subsequent violation of laws governing architects.

Chairman Porter advised provisions identical to those of AB 234 were contained at the end of AB 311 and stated the committee would hear both bills simultaneously with the focus on AB 311.

Ms. Gloria Armendariz, Executive Director, Nevada State Board of Architecture, introduced Ted Fuetsch, Chairman, Nevada State Board of Architecture, and Mona Joplin, the public member of the board. Ms. Armendariz explained the board consisted of five architects, one residential designer and one public member and was charged with "protecting health, safety and welfare through the regulation of the practice of architecture and residential design." Ms. Armendariz read from prepared text containing an explanation of each section of AB 311 (Exhibit C).

Mr Scherer suggested section 1 of AB 311 would generate a great deal of paperwork. He asked why a provision for temporary certificate was needed. Mr. Fuetsch explained the purpose was to enable an architect from another state, who was invited into Nevada by a client or governmental entity but was not licensed in Nevada, to respond in a short period of time. He advised it took much more time to process an application for reciprocity.

Mr. Scherer referred to section 2 and the proposed change in language from "and" to "or." He stated the reason given for the change was the Supreme Court had interpreted the statute defining the practice of architecture as requiring both "a holding out to the public" and "rendering or offering to render services." Mr Scherer asked why there would be concern if an individual was not rendering or offering to render services. Mr. Fuetsch replied the intent of AB 311 was to remove the linkage and make it illegal for an individual (who was not an architect) to claim he was an architect. Mr. Scherer inquired what difference it would make if an individual claimed to be an architect but neither offered to perform nor performed any architectural services. Mr. Fuetsch responded individuals were in fact doing one or the other, but based on the existing language of the statute, the courts were holding those individuals were not practicing architecture because they did not say they were architects. Mr. Scherer said he could see the need to address a situation in which an individual was engaging in architectural services but not holding himself out to be an architect, but did not see the need to address the opposite situation.

Mr. Scherer referred to the examination fee increase to $800, proposed in section 9, and asked the current fee. Ms. Armendariz replied the examination would cost the board $485 in December. She said in 1997, when the examination became computerized, the cost to the board would be $45 for each section, reducing the cost to approximately $360; however, in addition, the board would have to pay a vendor to administer the examination on the computer. She advised, at this time, the board did not know the total cost for the computerized examination. She stated the board now charged $450 for the examination.

Mr. Bonaventura asked how AB 311 would affect companies not licensed in Nevada which provided mail-order architectural plans. Mr. Fuetsch responded nothing in the provisions of AB 311 would change the illegality of such practice. Mr. Fuetsch advised approximately 1-1/2 to 2 years previously the board made an effort to identify all plan houses in the country which advertised and attempted to sell "cookbook" house plans in Nevada. He said the board informed those companies the practice of residential design was a regulated profession in Nevada, and they must cease and desist.

Mr. Arberry questioned the large increase in fine from $500 to $10,000 proposed in section 7. Ms. Armendariz responded $10,000 was the "ceiling." Mr. Arberry asked was this the norm throughout the country or had the board concluded this was a comfortable ceiling. Mr. Fuetsch replied in several cases practitioners had come into Nevada and practiced architecture without a license. He said if those practitioners charged fees of $20,000 to $200,000, a $500 fine was ineffectual. Mr. Arberry expressed concern about small companies being fined $10,000. Mr. Fuetsch stated 2 years previously the board instituted an enforcement-advisory committee system. He advised most disciplinary procedures were performed by a small committee of professional peers, which would hear any complaint and make a recommendation to the board as to any fine. He cited an instance in which the recommended fine was $50.

Mr. Arberry asked if AB 311 was generated exclusively by the board or if the board had input from other architects and residential designers. Ms. Armendariz replied the American Institute of Architects (AIA) supported AB 311. Mr. Arberry indicated Ms. Armendariz' response did not answer his question; he wished to know how architects in the field felt about the proposed legislation. Ms. Armendariz advised the board's enforcement-advisory committee consisted of approximately 85 members, comprised of architects, engineers and members of the public. She said when a complaint came before the board, an informal hearing was held. She explained the hearing normally was conducted by three architects, one engineer and one public member. She indicated the highest fine imposed to date was $1,000. She spoke of an architect who committed multiple violations and was fined $1,000 for each violation. She said the committee determined the amount of the fine based on the large sums the architect had earned through the violations. Mr. Arberry expressed his concern was whether the board was implementing something which the individuals it represented might not approve. Ms. Joplin responded. She said the AIA was a professional organization comprised of architect members who supported AB 311.

Mr. Arberry referred to the provisions governing residential designers set forth in section 2, and asked if members of the profession were in agreement with those provisions. Mr. Fuetsch replied a detailed synopsis of AB 311, with a request for response and comment, was published in the board's newspaper. He said the licensees were well aware of the provisions of AB 311, and those provisions were noncontroversial.

Ms. Giunchigliani pointed out "license" had been used in spoken testimony but in parts of AB 311, "certificate" was used. She inquired if there was a difference between the two words or if both meant the same. Ms. Armendariz replied both words meant the same.

Ms. Giunchigliani asked if the board recognized reciprocity when an architect was licensed or certified in another state. Mr. Fuetsch said the board did recognize reciprocity, but the architect licensed or certified in another state must have a certificate of qualification issued by the National Council of Architectural Registration Boards (NCARB). He stated once an architect had obtained an NCARB certificate, he could apply for licensure in any of the 55 jurisdictions and receive a license without reexamination. Ms. Giunchigliani asked the purpose of section 1 of AB 311. Mr. Fuetsch responded a reciprocal registration required board approval, and the board met only four to six times a year; therefore, there would be at least a one to two month waiting period for a reciprocal license to be approved. Mr. Fuetsch cited as an example a competition held by the Clark County Library in which nationally recognized architects were invited to participate. He advised few of the architects invited had current (Nevada) licenses. He said this resulted in an "incredible scramble" to license those individuals, because of Nevada's statute which stated holding oneself out as able to provide architectural services was the beginning of architectural practice in Nevada.

Ms. Giunchigliani referred both to the words "or use the title of architect" in section 4 and the proposed change of "and" to "or" in section 2 and requested clarification. She posed a hypothetical situation in which an architect, licensed by the national council, lived in Nevada, chose not to practice architecture in Nevada but referred to himself as an architect. Mr. Fuetsch stated an individual was not an architect in Nevada unless licensed by the Nevada government. He said such an individual could refer to himself as an architect in casual conversation but could not approach a potential client and claim to be a Nevada licensed architect.

Ms. Giunchigliani asked if architecture recognized owner-builders. Mr. Fuetsch replied affirmatively. Ms. Giunchigliani asked was it correct an owner-builder could not hold himself out as an architect even though he had designed his own building plan, and if he did hold himself out as an architect, he would be in violation of the provisions of AB 311. Mr. Fuetsch said that was correct. Ms. Armendariz pointed out the amount of education and internship required to become an architect and proposed not everyone who designed a house qualified to be called an architect. Further discussions were held between Ms. Giunchigliani and Ms. Armendariz concerning conditions under which an individual might or might not be able to refer to himself as an architect.

Mr. Perkins asked for a definition of "holding out to the public" in the context of AB 311. Mr. Fuetsch replied it meant representing to the public one was an architect licensed in the state of Nevada and could use all privileges specified in NRS 623 when, in fact, one did not hold a Nevada license.

Mr. Perkins asked if the process of issuing a temporary certificate of registration would be standardized and what would be involved in the process. Mr. Fuetsch referred Mr. Perkins to section 1, subsection 1(b) of AB 311. He pointed out the key requirement was the applicant held a certificate issued by NCARB, which meant the applicant was licensed elsewhere and his license was in good standing. Mr. Perkins asked if the fact a person held an active NCARB certificate would preclude further background investigation. Mr. Fuetsch responded affirmatively.

Mr. Arberry asked if AB 311 was the same bill lost during the last legislative session. Ms. Armendariz replied it was.

Mr. Bennett asked for an explanation of the fiscal note on AB 311. Ms. Armendariz indicated she had no knowledge of any cost to local government other than monies paid by the board to its budget analyst. Chairman Porter stated Mr. Scherer had suggested the fiscal note might pertain to the criminal provisions of the bill.

Stephanie Tyler, Legislative Coalition of Interior Designers, introduced Bruce Goff, Chairman, Legislative Coalition of Interior Designers. Mr. Goff explained the coalition was created approximately two years ago when a bill similar to AB 311 was placed before the Nevada Senate. He said the coalition had concerns about the prior bill and had concerns about AB 311, which expanded on the prior bill. He cited the provision of AB 311 concerning direct supervision, contained on page 2, line 13, as one subject of concern. He indicated many interior designers in Nevada worked as independent agents. He explained such an interior designer, if hired by an architect, would not work for the architect but as an independent consultant. He advised the coalition's second concern was the description of architecture set forth in AB 311 on page 2, commencing at line 15. He said the description encompassed many things done by interior designers, and therefore, AB 311 would make interior design illegal because doing interior design would constitute practicing architecture.

Ms. Tyler advised Marcia Berkbigler represented the engineers and had substantial concerns about AB 311 but was unable to be present at the hearing. She said Ms. Berkbigler would like an opportunity to review the bill.

Ms. Augustine said she understood interior designers were proposing a separate bill concerned with licensure and asked if her understanding was correct. Mr. Goff indicated the coalition hoped to do so.

Mrs. Williams said, with few exceptions, the language in section 2, subsection 5, was language used in the existing statute. She suggested perhaps the Board of Architecture should advise whether, by use of such words as "aesthetic" and "design," it was the board's intent to include interior designers under the provisions of that section. Mr. Goff advised interior designers incurred problems due to the existing language, some having been accused of practicing architecture. He stated adding the "and"s and "or"s would tend to increase the problems. He said there was no definition for the profession of interior design. He advised the coalition was attempting to establish a definition to eliminate conflict between what constituted interior design and what constituted architecture.

Ms. Joplin said a past problem involving interior designers and the practice of architecture arose from the fact some interior designers did space planning. She stated public health, safety and welfare were affected by space planning because of the considerations involved in the planning. Ms. Joplin advised the board met with the coalition at the request of the last legislature. She said the board agreed to present a bill to the legislature which would allow an interior designer to do space planning on condition he passed an examination to determine his knowledge of safety codes and regulations. She stated the interior designers would be allowed a period of time to meet the educational requirements. Ms. Joplin indicated problems arose because "everyone insists on being grandfathered." Ms. Joplin contended individuals who had not been educated and had not passed an appropriate examination were not qualified to design or remodel buildings when public health, safety and welfare were affected, and she expounded on her contention at some length.

Mrs. Williams said it appeared not many interior designers were involved in space planning. Ms. Joplin responded Mrs. Williams was correct. Mrs. Williams suggested a compromise between the board and the coalition which would require interior designers involved in major space planning projects to obtain the board's approval of their plans rather than go through an educational process which pertained more to architecture than interior design. Ms. Joplin said the board had hoped to have an interior designer as a member of the board. She said the board was willing to utilize the NCIDQ examination which was not an architectural examination and would be administered by interior designers.

Chairman Porter closed the hearing on AB 311 and AB 234 and assigned AB 311 and AB 234 to Mr. Scherer as a subcommittee of one.

Chairman Porter called for motions for committee introduction of the following bill draft requests:

BDR 19-393 Substitutes civil enforcement of access to public records for criminal penalty.

ASSEMBLYMAN BENNETT MOVED FOR COMMITTEE INTRODUCTION OF

BDR 19-393.

ASSEMBLYMAN ARBERRY SECONDED THE MOTION.