MINUTES OF THE ASSEMBLY
SELECT COMMITTEE ON GOVERNMENT REORGANIZATION
Sixty-seventh Session
March 17, 1993
The Assembly Select Committee on Government Reorganization was called to order by Co-Chairman Val Z. Garner, at 5:43 p.m., on Wednesday, March 17, 1993, in Room 119 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda. Exhibit B is the Attendance Roster.
ASSEMBLY COMMITTEE MEMBERS PRESENT:
Mr. Val Z. Garner, Co-Chairman
Mr. Robert Sader, Co-Chairman
Mr. Morse Arberry, Vice Chairman
Mr. Rick Bennett
Mr. Joe Dini
Mrs. Jan Evans
Mrs. Vivian L. Freeman
Ms. Chris Giunchigliani
Mr. William Gregory
Mr. Dean Heller Absent
Mrs. Joan A. Lambert
Mr. John Marvel
Mr. Gene Porter
Mr. Bob Price
Mr. Larry Spitler
Mrs. Myrna Williams
Mr. Wendell P. Williams
OTHERS PRESENT:
Judy Matteucci, Director, Dept. of Administration
Keith MacDonald, Executive Secretary,
State Board of Pharmacy
Jerry Higgins, Executive Director,
State Board of Engineers and Land Surveyors
Todd Russell, Legal Counsel, Nevada State
Board of Accountancy
Carl Cahill, Secretary, Board of Registration for Sanitarians
Joel Glover, Nevada Board of Dental Examiners
Ted Fuetsch, Chairman, State Board of Architecture
Georgianna Barrett, Nevada State Board of
Physical Therapy Examiners
Judy Ishibashi, State Board of Occupational Therapy
Michael Riley, DC., Chiropractic Board
Reenie Whitney, Executive Secretary, Nevada State
Board of Veterinary Medical Examiners
Bonnie Schultz, Chairman, Nevada State Board of Cosmetology
Margi Green, Nevada State Contractors' Board
Following roll call and opening remarks by Co-Chairman Garner, Judy Matteucci, Director of the Department of Administration, drew attention to four handouts which she said she would use for her presentation. Exhibit C was an organization chart for Business and Industry which delineated the structure proposed for regulatory boards and their designation as liaison or administrative support; Exhibit D was a chart showing the recommended status for state occupational licensing boards and a spread sheet showing the proposed assessments to be levied against the occupational boards; Exhibit E was a handout showing the proposed consolidation of various boards; and Exhibit F was a table indicating the proposed relationship for each board within the larger state agency.
Ms. Matteucci stated all the boards shown in Exhibit C were regulatory and would remain regulatory under the Governor's proposed reorganization plan. Regulatory boards, she explained, were statutorily charged with governmental or quasi judicial functions and were categorized on the Exhibit as being in a liaison relationship with the Department or as receiving administrative support from the department. Those in the liaison role were generally the larger boards sufficiently funded and adequately staffed; and those designated to receive administrative support from their related department were generally smaller boards with funding insufficient to allow for more than minimal staffing.
Explaining Exhibit D, "State Occupational Licensing Boards - Recommended Status," Ms. Matteucci said all professional occupational licensing boards were recommended to be placed in the Department of Business and Industry. This was being proposed in recognition of the licensing and regulatory role performed by the boards for the specific industry for which the board was created.
Ms. Matteucci pointed out to assist the licensing boards the Governor recommended budget included the creation of a Management Analyst position within the Department of Business and Industry Director's office and this position would be charged with maintaining ongoing communications with each board. The cost of the position was prorated to each occupational licensing board in the same manner as the charges for budget services had been in past bienniums.
Attached to the back of Exhibit D was a spread sheet summarizing the budget and department charges for the 93/95 biennium, Ms. Matteucci stated. The smaller boards, or those requiring administrative support, would also be offered services of file storage, phone services, etc., but were assessed a much smaller fee. Although they needed administrative support they were unable to fund the entire Management Analyst position. Therefore, all boards were being assessed on the same basis they were currently being assessed for budget division services.
Ms. Matteucci noted on Exhibit D the boards showing no change were virtually unchanged other than being charged an assessment to support the Management Analyst position. There were eight boards recommended for combination. She said all the boards would continue to have their own budgets, they would continue to have control over their own funds and the funds would not be brought into the state treasury.
Exhibit E, Ms. Matteucci explained, showed the current and proposed makeup of the boards being combined. She then proceeded to describe each combination as it was set forth in the Exhibit.
In response to his question, Ms. Matteucci assured Mr. Price the appointing procedure for the boards would not change.
Mrs. Evans told Ms. Matteucci she had received calls regarding the consolidation of the Hearing Aid Specialists, and Audiologists and Speech Pathologists. The concern expressed by members of the Board of Audiology and Speech Pathology was their work was to diagnose and treat hearing and speech disorders; whereas the hearing aid specialists were business people selling a product. Was this a mixed mission? Explaining the rationale, Ms. Matteucci said first, these were both licensing boards, focused primarily on hearing disorders. The consultants had felt the combination of the two brought like disciplines together resulting in administrative streamlining. Mrs. Evans maintained the Audiologists and Speech Pathologists were professionals especially educated with graduate degrees and having a different thrust from those selling hearing aids. Ms. Matteucci reiterated this was a licensing board not a treating practice. Mrs. Evans was not convinced.
Mr. Marvel asked Ms. Matteucci how much time the consultants had spent with the various boards in devising the proposals. Ms. Matteucci said the consultants had had a number of meetings and during one meeting the attending boards had voiced their opposition and outrage with the suggestion anything be done to change their structure. Specifically, she added, the Board of Pharmacy had made a significant presentation relative to its effectiveness and questioned the purpose of changing its organizational structure. She said she understood the boards had been contacted and meetings were well attended. Mr. Marvel asked if the consultants had heeded any of the recommendations. Ms. Matteucci said she believed the consultants were swayed by arguments made and had been convinced there was no purpose in bringing some of the larger boards more tightly into the bureaucratic structure. They had agreed it would be better to establish a better communication role. This was why the split between liaison and administrative support was shown; and Ms. Matteucci said the changes would be very transparent.
Mr. Arberry questioned how the board governing bodies were to be determined. Once the boards were combined would new chairpersons and vice chairpersons be elected by board members or would the boards retain their individual chairperson? Ms. Matteucci said after combining two boards into one, they would have to reelect a chairperson for that particular board. Thereafter, actions would be taken on issues related to both cosmetologists and barbers as a unified board.
Counsel authority was questioned by Mr. Spitler. He asked if the boards used private counsel or whether they used the attorney general. It depended on their present statutory authority, Ms. Matteucci replied. Some had authority for outside counsel, some were permissive and some used the attorney general. There was no thought to change the statutes requiring them to use one or the other.
In response to a question from Mr. Williams, Ms. Matteucci said the Board of Cosmetology presently licensed the manicurists. Mr. Williams thought there were inequities which gave the cosmetologists and barbers an advantage in numbers for voting purposes, etc. Ms. Matteucci opined neither the State Health Officer nor a member of the general public could be considered biased. She did not think it made sense to just combine two small boards and create one large board, thus, they had tried to balance it. She said if Mr. Williams perceived an imbalance, they would be happy to work with him on what he considered a fair balance.
Mrs. Freeman reported she had heard from several cosmetologists expressing concern regarding their function. On the other hand, Ms. Matteucci said she had received some positive comments from certain cosmetologists.
Although Mrs. Williams did not necessarily oppose the combination of the barbers and the cosmetologists, she did agree with Mrs. Evans' concern regarding the consolidation of hearing aid specialists and audiologists and speech pathologists. This appeared to be a combination of "vendor" functions with "medical" specialties. She believed the functions did belong in Business and Industry, but was not convinced they should be so combined.
Co-Chairman Garner then opened the hearing to public testimony.
State Board of Pharmacy - Coming forward to testify, Executive Secretary Keith MacDonald questioned as follows:
1) If the Department of Business and Industry Director would have administrative directive authority which would supersede the fulmination of regulations by the board.
Co-Chairman Garner said, "No."
2) If the liaison board assessments would be limited to a reasonable percentage of the board's budget or whether it would be expanded to answer future needs of the Department of Industry. For instance, Mr. MacDonald questioned, could the Department of Business and Industry require an assessment of excess monies?
Ms. Matteucci stated she could not predict it would never increase, however, it was designed to cover the cost of the Management Analyst position and operating costs relative to communication between government and the board. It would have to be directly related to services provided by the board, and would not be an usurpation of excess Pharmacy Board monies.
3) If any portion of the reorganization would cause liaison boards' executive secretaries or directors to be appointed by the Governor.
Ms. Matteucci responded this would not be the case for the occupational licensing boards. In fact, many of the other boards and commissions which currently had executive directors appointed by their commission, would be changed, but as represented, the boards and commissions would continue to appoint their executive directors.
4) Would there be a mechanism allowing the boards administrative support or liaison status to be changed at its request? For instance, Mr. MacDonald said, if something happened financially and they wished to move into the administrative support side, could this be done?
Financially, Ms. Matteucci said, neither the liaison or administrative support boards were being treated differently. If the Board of Pharmacy wished to come into the administrative support function, the board would have to be smaller.
State Board of Engineers and Land Surveyors - Executive Director, Jerry Higgins, was called forward to testify. He indicated Ms. Matteucci's testimony had allayed many of their concerns. However, his board was concerned regarding the future of his board and the competition under an umbrella agency. Although theirs was a liaison arrangement now, would it remain so in the future; and was there a possibility the board would simply be dissolved.
Mr. Higgins questioned how the Legislature planned to proceed on the proposed reorganization and if there would be a time when everyone could consider a specific bill. Co-Chairman Garner stated there was no question if reorganization did not occur there would have to be another budget. However, he did believe reorganization would occur; and there would eventually be a reorganization bill. Mr. Higgins declared they were anxious to see the bill.
Responding to Co-Chairman Garner's remarks, Mr. Price indicated there were changes he definitely intended to pursue which would, indeed, affect the budget.
Nevada State Board of Accountancy - Legal Counsel, Todd Russell, came forward to testify. Offering background remarks, he said his organization regulated approximately 1,600 licensed CPAs and PAs in the state of Nevada. Although the board had been reassured by the Department of Administration as to the future, they still had serious concerns. They were not clear what a "liaison" relationship was, nor what a "transparency" relationship was. Mr. Russell pointed out his board had been operating independently since 1913 and operating under the Public Accountancy Act since 1963. The Governor's only function was to appoint the seven-member board.
He said they had not only not seen the bill, but they were also concerned about opening the door to the uncertainties presented by being brought under the larger umbrella of the Department of Business and Industry. Mr. Russell stated adamantly the accountants wished to be regulated by their own profession. Placement within the Department of Business and Industry only opened the door to further regulation by persons not directly involved in the profession.
Mr. Russell also thought it was important to note the Commission on Government Reorganization had not recommended the larger boards be placed under Business and Industry, but had rather recommended they be kept independent. Mr. Russell said they also objected to funding a Management Analyst position for someone to further monitor their board without offering any substantial service.
Mrs. Lambert asked Mr. Russell if the Board of Accountancy was presently being assessed any fees by the budget office. Mr. Russell said, "yes," they were being assessed a fee, although there was a minimum amount of work performed for the board.
Mrs. Evans questioned Mr. Russell's remark regarding the Commission's lack of recommendation for placement within the Department of Business and Industry. Mr. Russell stated the early study had indicated they felt the smaller licensing boards should be placed under the Department of Business and Industry for administrative aid. Through discussions with the committee and with the chairman, Kenny Gwenn, Mr. Russell said it had been their understanding the larger boards were not to be brought under Business and Industry.
Responding, Ms. Matteucci indicated there had been a great deal of misinformation in this regard. The Commission did not recommend the larger boards not be brought under the Department of Business and Industry. The Commission had a number of definitions between smaller and larger boards and there was never an intention to exclude the larger boards. There was no way the smaller boards could fund the Management Analyst position by themselves.
Mr. Russell questioned whether it was, indeed, the intent to use the larger boards to fund the Management Analyst position in the Department of Business and Industry. Ms. Matteucci said she was trying to make it clear there was no onus being placed on any of the boards -- they all remained independent.
Mr. Russell remained adamant in his objection to the proposed reorganization.
Ms. Giunchigliani pointed out no board would exist without regulation and statute; and none would exist without appointment by the Governor. As she saw it, it was an accountability issue which would work equally for the board and for government.
Co-Chairman Garner called on Gary Nelson from the Nevada LP Gas Board for testimony, however, Mr. Nelson said his concerns had been answered.
Board of Registration for Sanitarians - Coming forward to testify, Secretary Carl Cahill told the committee their function was to inspect food establishments, water supplies, sewage facilities, solid waste management, hazardous waste and air quality. The concern expressed by his board, Mr. Cahill said, centered around the fee to be assessed. They did not want to be assessed to the point where they had to go out of business or lose their membership.
Nevada Board of Dental Examiners - Joel Glover commended Ms. Matteucci on her presentation which, he said, had answered many of their concerns. However, he agreed with comments made by Mr. Russell that their organizations had operated effectively and efficiently for many years and did not need support services. He said he would like to see their board placed in the category of "liaison" rather than administrative services.
State Board of Architecture - Chairman Ted Fuetsch said his board currently regulated 1,900 architects and 30 residential designers, managed a yearly budget of $400,000 and operated independently and effectively. Mr. Fuetsch expressed opposition to reduction of the board, although they were not opposed to the combination of landscape architecture and architecture. He told the committee his board had gone to the attorney general's office offering to fund a new deputy attorney general position to assist their board and this offer had been denied. Ultimately, if the proposed change was to occur, Mr. Fuetsch felt strongly the number of appointed board members should not be reduced.
Nevada State Board of Physical Therapy Examiners - Georgianna Barrett, physical therapist in private practice, indicated her board's opposition to the combination of the Nevada State Board of Physical Therapy Examiners and the Occupational Therapy Board. The professions were very different, Ms. Barrett maintained and it would represent a challenge to regulate both boards under the same umbrella. The proposal was also seen as a financial burden. If there was no choice but to accept the combination, Ms. Barrett urged that the number of board members in each profession appointed to the board be tied to the amount of licensees in the state.
State of Nevada Board of Occupational Therapy - Chairwoman, Judy Ishibashi, came forward to express opposition to the Board of Occupational Therapy being combined with the Physical Therapy Board. Ms. Ishibashi complained her board had not been notified of either this meeting nor other meetings in the past, thus, they had no written material available to reinforce their position. She said their board felt the combination would greatly curtail the amount of credible information being circulated to the public, decrease its representation and place their profession in jeopardy. She cited the many difficulties which would arise because of the differences in the professions. Basically, Ms. Ishibashi asked why the Board of Occupational Therapy was being placed in a different category from other health care professionals.
Addressing the question, Ms. Matteucci said they had not split any of the occupational licensing boards because the nature of their job was to license and regulate people in certain specific occupations. Thus, it was considered more appropriate for them all, regardless of focus of discipline, to go into Business and Industry.
Chiropractic Board - Michael Riley, DC., expressed the same opinion as his colleagues in the dental profession. He said they had no firm opposition to the reorganization, anticipating this would lead to better government; however, they did object to being referred to as an administrative support board. He told the committee this was a substantial board, with an executive director and professional staff, they had maintained budgets, fulfilled budgetary requirements, worked with the attorney general's office and generally had a well-functioning board. Mr. Riley asked that the Chiropractic Board be listed in a liaison category.
Mrs. Williams asked Ms. Matteucci how they had determined which category to place the Chiropractic Board. Ms. Matteucci said the figures indicated the Chiropractic Board was a relatively small board as compared to some of the other boards; however, Ms. Matteucci maintained it made no difference whether they were called "liaison" or "administrative support." If they were more comfortable being in a liaison category, this was entirely acceptable.
Ms. Matteucci assured Mrs. Williams the "liaison" category would require no greater assessment than "administrative support." It was simply a reflection of the size of the budget relative to other budgets and was on the same proration used to break down budget division assessments.
Ms. Matteucci told Mrs. Evans if a board was presently supporting positions, nothing in the budget would disturb that. The only change would be the additional assessment to pay for the Management Analyst position. Mrs. Evans was concerned if a board was presently paying for a position and under reorganization was required to help fund the Management Analyst position, this worked unfairly for the board. Ms. Matteucci acknowledged the point, but added it would be impossible to allow each individual board to set up their own paid positions unless they accepted that cost along with the assessment.
Nevada State Board of Veterinary Medical Examiners - Reenie Whitney, Executive Secretary, indicated their board supported the reorganization of state government, particularly the aspects of privatization. They had objected to the Peat Marwick reference to "small boards" and their obvious need for administrative support. Ms. Whitney suggested Nevada should learn from the mistakes made during the reorganization of other states. In Iowa, when Peat Marwick and Mitchell assisted with the Iowa reorganization, they had ignored small government entities like the Veterinary Board. Consequently, the Iowa taxpayers paid the bills for the Iowa State Veterinary Board plus others. The Nevada Veterinary Board's renewal fees covered all legal, administrative and investigative expenses for the veterinary board, with no major government entity paying to support the board. Ms. Whitney drew attention to Exhibit F and read the text into the record.
Ms. Whitney specifically requested that the Board of Veterinary Medical Examiners be recategorized as liaison rather than administrative support.
Nevada State Board of Cosmetology - Bonnie Schultz, Chairman of the board, said their board had remained neutral throughout the reorganization process. However, she pointed out the numbers involved and opined equal representation should be considered. The Board of Cosmetology had approximately 11,000 licensees, 3,500 of which were manicurists. There were only 350 aestheticians and approximately 600 barbers. Ms. Schultz suggested the makeup of the board representation was quite unequal.
Nevada State Contractors' Board - Representative Margi Green told the committee they were concerned about the proposed move into the Department of Business and Industry. They had been under the impression their board would not be affected in any way by the reorganization. Ms. Green opined there should be no question of their present accountability as they reported their budget on a quarterly basis to the budget division; their board members were accountable to the industry as well as the Governor; they prepared financial statements for each quarter; and provided a yearly budget. They were also concerned the funds received through contractor license fees would go to the intended destination, i.e., the protection of the public in the construction industry. Relating their past assessments and the proposed additions, Ms. Green said by the end of 1995 they would have paid $123,665 for something which had no definite merit. The question was what the public would get for this expenditure and what the contractors' board would get.
Responding to Ms. Green's remarks, Ms. Matteucci said as far as the budget division assessment, in 1985 and 1987 the Legislature had imposed the assessment. In 1989 the budget office had proposed reducing the amount of money being charged the boards and commissions and the Legislature had again raised the fee to fund a full-time position. As to the benefit, Ms. Matteucci said one of her staff members devoted his time to assuring the licensing boards complied with NRS 353; reviewed the audits submitted for the various boards to assure the dollars being paid were spent in compliance with state law; and the budget office provided state administrative manuals to keep them within the regulatory body. The additional assessment for the Management Analyst position would provide a greater communication network and would monitor the policies and ongoing activities so state government could be more informed and the boards and commissions would be more informed as to what was going on in state government.
Referring to Exhibit E, Mr. Spitler said he did not oppose the reorganization; however, he wanted to be assured the current mandates, span of control and responsibilities remained the same. He asked Ms. Matteucci to clarify the statute modifications shown. He also wanted to know if the bill would contain an "umbrella" clause which addressed the various things such as salary, qualifications for board members, what constituted a quorum, etc. Ms. Matteucci explained the statutory modifications delineated only the combination on the specific board or commission. In the combining of the boards, Ms. Matteucci said they had had to choose one set of statutes to go to and one to abandon.
Referring to the boards to be combined, Co-Chairman Sader asked Ms. Matteucci how they had derived the makeup of the combined board as shown on Exhibit E. She told him they had not looked at the number of licensees, but she thought the suggestion from Ms. Schultz (Board of Cosmetology) having to do with basing the representation on numbers of licenses, had merit. Mr. Sader suggested it would be good to solicit written comments from each of the proposed consolidated boards. Ms. Matteucci agreed, adding that comments regarding what the consolidated boards thought was fair would be helpful. To obtain this information, Ms. Matteucci said she would draft a letter directed to each of the eight boards being considered for consolidation soliciting their comments and suggestions. Mr. Sader volunteered to disburse the letter if Ms. Matteucci would draft it.
Margi Green asked to be included in discussions regarding the study. She indicated no one had personally gone to their office for first-hand information on how the board functioned or how many licensees were involved.
Representing the Attorney General's Office, Jonathan Andrews, Chief Deputy Attorney General, clarified an earlier statement by the Chairman of the Board of Architecture that the Attorney General had rejected their offer to fund a deputy attorney general position. Mr. Andrews agreed the Architecture Board had made the offer to fund part of the position. Subsequently, when the Attorney General approached the Interim Finance Committee to obtain authority to fund the position the Interim Finance Committee had chosen not to approve the funding.
Returning to testify, Mr. Fuetsch asked if Ms. Matteucci would meet with the boards being proposed for consolidation to discuss the proposal. Mr. Garner agreed to take the suggestion into consideration and make a determination on the issue.
There being no further testimony, the meeting was adjourned at 7:14 pm.
RESPECTFULLY SUBMITTED:
Iris Bellinger
Committee Secretary
APPROVED BY:
__________________________
Assemblyman Val Garner
Co-Chairman
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Assembly Select Committee on Government Reorganization
Date: March 17, 1993
Page: 1