MINUTES OF THE
ASSEMBLY COMMITTEE ON WAYS AND MEANS
Sixty-seventh Session
Friday, March 19, 1993
The Assembly Committee on Ways and Means was called to order by Chairman Morse Arberry, Jr., at 8:00 a.m., on Friday, March 19, 1993, in room 352 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda, Exhibit B is the Attendance Roster.
COMMITTEE MEMBERS PRESENT:
Mr. Morse Arberry, Jr., Chairman
Mr. Larry L. Spitler, Vice Chairman
Mrs. Vonne Chowning
Mr. Joseph E. Dini, Jr.
Mrs. Jan Evans
Ms. Christina R. Giunchigliani
Mr. Dean A. Heller
Mr. David E. Humke
Mr. John W. Marvel
Mr. Richard Perkins
Mr. Robert E. Price
Ms. Sandra Tiffany
Mrs. Myrna T. Williams
COMMITTEE MEMBERS ABSENT:
None
STAFF MEMBERS PRESENT:
Mark Stevens, Fiscal Analyst
Gary Ghiggeri, Deputy Fiscal Analyst
TAXICAB AUTHORITY - PAGE 584
Sandra Lee Pardo, Administrator, Taxicab Authority, stated the agency had reduced expenditures over the last biennium, therefore the agency's funding request was lower than the FY 93 work program request. Mrs. Pardo referred to Exhibit C and stated the Taxicab Authority received the 1991 National Clearing House on Licensure, Enforcement and Regulation Program Award. State of Nevada Taxicab Authority Taxicab Industry Statistics (Exhibit H) are on file in the Research Division. The award was for innovative and effective training programs developed for taxicab drivers and other personnel aimed at addressing significant problems confronting the taxicab industry. The programs awarded were: (1) Driver Awareness Program - an 8 hour weekly course completed by every driver; (2) Special Service Vans Training and Video - an educational program and video produced to increase awareness regarding transportation of the physically disabled; (3) Dispatcher/Telephone Personnel Training and Video - an educational program for all taxicab company dispatchers and telephone personnel on the proper procedures to follow in emergency situations and effective communication skills and phone courtesy; and (4) Technological Improvements for Driver Safety. Mrs. Pardo explained toward the goal of increased driver safety, the Taxicab Authority is involved in the continuing search for technical improvements which deter crimes against taxicab drivers. She indicated high-tech companies working closely with the Taxicab Authority and certain taxicab companies were developing systems such as "Stop Crimes Against Taxi's" (SCAT) that acts as a crime deterrent by video taping passengers. Mrs. Pardo stated all taxi's posted notice of the video camera.
Mrs. Pardo indicated the Taxicab Authority was a self-funded agency which served Clark County. The reserve would be reduced over the next biennium due to increased salaries and the addition of positions. Mrs. Pardo commented the deputy administrator position, approved during the last session, had not been filled. She indicated over the next biennium 1,100 new rooms would be available in Las Vegas which could facilitate a need for additional drivers. According to Mrs. Pardo driver attrition had been less than half of the projections from FY 91-92.
Mrs. Pardo informed the committee a report recently released by the Environmental Protection Agency had classified secondary smoke as a carcinogen. Anticipating OSHA requirements, the agency had distributed no-smoking signs to all taxi drivers. However drivers were authorized to permit smoking in the taxi's if they wished.
Chairman Arberry commented the nonsmoking signs could be overly restrictive. Mrs. Pardo replied if attempts were not made to ensure drivers workplace safety the state could be liable.
Chairman Arberry asked when the chief investigators position would be filled. According to Mrs. Pardo the position would be filled within the next 10 days. Chairman Arberry asked if any other positions were being held vacant at this time. Mrs. Pardo replied three of the five Airport Control Officers approved by the Interim Finance Committee were currently filled. She stated the positions were fully funded by the Las Vegas Airport Authority.
Chairman Arberry asked if the new taxi safety measures were failsafe. Mrs. Pardo replied no system was failsafe but safety training in combination with the new system would enhance driver safety.
Ms. Giunchigliani questioned why Clark County was the only area the Taxicab Authority regulated. Mrs. Pardo indicated formerly taxi's were regulated by the Metropolitan Police Department. She stated severe problems were occurring with taxi's in 1967 such as bombings, shootings, and verbal threats. Mrs. Pardo stated the Taxicab Authority was established, at the request of members of the industry, by the Legislature to regulate the taxicab industry in Clark County. Ms. Giunchigliani commented since Clark County was the only county served by the Taxicab Authority then did it qualify as a true state agency. Mrs. Pardo replied the statute included a provision that any county with a population over 400,000 could request the services of the agency. She stated northern Nevada was regulated by the Public Service Commission. Ms. Giunchigliani commented having two state agencies regulating the same industry was ludicrous.
Mr. Spitler commented the Public Service Commission had an enormous sphere of industries to regulate and the Taxicab Authority did an excellent job in Clark County. Mr. Spitler questioned how the average $7.00 fare was calculated. Mrs. Pardo replied the fare was the average cost of a seven mile fare. Mr. Spitler commented he was pleased to hear about the no smoking signs and was considering proposing a bill which would prevent smoking in taxi cabs. Mrs. Pardo stated legislation was probably not needed at this time. Mrs. Pardo added if the Taxicab Authority forced a driver to carry passengers who smoked the state may incur some liability problems.
Mr. Spitler asked if the agency kept the fines it assessed. Mrs. Pardo indicated the agency had declined an increase in fines recommended by the Attorney General. She indicated the agency attempted to protect the driver as well as the industry by assessing reasonable fines. Mr. Spitler asked if any of the fines had been decreased. Mrs. Pardo stated none of the fines had been decreased. Mr. Spitler commented he was concerned some of the fines were quite costly. Mrs. Pardo indicated the agency attempted to maintain fairness and balance with the fines.
Mr. Price asked the amount of the highest fine assessed by the Taxicab Authority. Mrs. Pardo indicated the highest fine was $500 and that the amount of each fine increased with the number of violations. She stated all fines were assessed by an Independent Hearing Officer and could be appealed.
Mr. Heller questioned if an unsatisfied customer could complain to the Taxicab Authority. Mrs. Pardo indicated investigators were available 24 hours a day to personally respond to complaints within 15 minutes. She indicated two avenues could be taken: (1) file a formal complaint and the driver would be charged, or (2) file a verbal complaint with the investigator and the driver's supervisor would be contacted within 15 minutes. Mr. Heller asked how many complaints were filed. Rick Boxer, Senior Auditor, stated a method of recording the number of complaints had not been established. Mrs. Pardo estimated approximately two complaints were investigated every 24 hours. Mr. Heller requested the number and time of response be included in the performance indicators. Mr. Heller asked the committee be provided the number of abuses and assaults on drivers. Mrs. Pardo stated of the 10 million trips provided in FY 92, 84 drivers had altercations and three were physically harmed. Mr. Heller requested the average wage of taxicab drivers. Mrs. Pardo stated the lowest salary was $16,000 and $45,000 was the highest. He commended the agency for their efforts.
Ms. Giunchigliani asked how often the senioride coupon books could be purchased. Mrs. Pardo indicated the value of the books was $20 but could be purchased for $10 monthly. Ms. Giunchigliani asked how much participation in this program had increased. Mrs. Pardo stated usage increased from 1,000 to 3,500 participants over the last year. Ms. Giunchigliani asked why had funding for the senioride program been reduced. Jeanne L. Botts, Program Analyst, Legislative Counsel Bureau explained page 586 of the Executive Budget showed an agency request for $11,380 in the senioride category which was not recommended by the Governor. She explained although the agency was self funded any funds which increased after FY 92 were budgeted as Enhancements by the Budget Division and were not recommended by the Governor. Ms. Giunchigliani commented the funding for the program should remain intact.
Ms. Giunchigliani asked if the agency had handicapped vehicles. Mrs. Pardo replied $35,000 lifts were installed on the handicapped accessible vehicles which were available at regular taxicab rates 24 hours a day.
Ms. Giunchigliani asked what type of training was completed by the drivers. Mrs. Pardo stated all of the drivers complete an eight- hour training course which included public and personnel safety, locations, laws, and handicapped transportation.
Ms. Giunchigliani asked if taxicab companies serviced specific areas. Mrs. Pardo stated each of the companies were issued certificates which designated specific service areas. She explained all companies were limited to specific pick-up areas but could provide delivery service to any area in Nevada.
Mr. Boxer explained the base budget was calculated based on actual expenditures from FY 92. He stated everything in excess of FY 92 actual was reflected in the Enhancements section. Mr. Boxer commented FY 92 was a recessionary year. This could easily be illustrated when one examined the issuance of driver permits, 1,200 were projected of which only 623 were issued. As a result expenses decreased in FY 92. However, based on the additional 1,100 new rooms which would become available over the next biennium, expenses were expected to increase. Mr. Boxer anticipated the need for additional drivers and commented the agency would likely return to the Interim Finance Committee for further funding authorization.
Mr. Marvel asked if the cost recovery plan which had doubled was appropriate. Mr. Boxer explained a half-time Deputy Attorney General had been reallocated into the cost recovery plan which explained the significant increase.
Mr. Marvel asked why the reserve which had been approximately $500,000 decreased to approximately $160,000. Mr. Boxer stated the 66th Legislative Session had mandated the reserve be decreased. This had been accomplished by increasing funding to the senioride program and hiring additional personnel.
Mr. Perkins asked how many peace officers were employed by the Taxicab Authority. Mrs. Pardo stated the agency employed 15 plain-clothes officers which were armed and on duty 24 hours a day as well as 25 uniformed airport officers. Mr. Perkins asked if the officers received benefits from the heart and lung bill. Mrs. Pardo stated she felt it was inconceivable that the men and women who put their lives in jeopardy were excluded from the bill. Mr. Perkins asked if the armed officers were required to carry a Peace Officers Service and Training (POST) certificate which demanded the completion of 24 hours of training per year. Mrs. Pardo affirmed the peace officers performed all duties and had all of the responsibilities of any other peace officer in the state. Mr. Perkins asked where the training funds for the officers were allocated in the budget. Mrs. Pardo indicated the agency maintained an in-house trainer certified by POST and the funds were included under both personnel expenses and instructional supplies in the operating budget. Mr. Perkins asked what steps were being taken to cover the Taxicab Authority peace officers under the heart and lung bill. Mrs. Pardo stated the agency had testified before Public Employees Retirement System (PERS) twice and been denied. The agency continues to appeal the PERS decision.
Mr. Perkins asked why funding was recommended to decrease in the second year of the biennium when Clark County had approved the construction of 1,100 new rooms. Mr. Boxer explained the reserve would be reduced but the expenditure level over the entire biennium would remain the same. Mr. Perkins asked if the agency anticipated higher revenues because of the additional demand from the 1,100 new rooms. Mr. Boxer stated higher revenues were anticipated.
Chairman Arberry instructed Mrs. Pardo to submit a revised funding request which detailed the impact of new construction on the agency.
COMMISSION ON TOURISM - PAGE 602
Thomas G. Tait, Executive Director, Commission on Tourism stated the following presentation was a continuation from Wednesday, March 10, 1993. Mr. Tait indicated the agency had projected an 8.75 percent increase in room tax revenues over the 1991-1993 biennium. However only 2.52 percent had materialized in FY 92 because of the economic impacts of the recession and the Persian Gulf War. For FY 1993 to date 6.6 percent had been realized. As a result the 1993-95 biennial budget attempted to return to the FY 1993 approved work program levels. Mr. Tait indicated the agency had been forced to reduce the work program in order to fulfill the requirements of the budget shortfall. As a result the enhancement budget was reflective of an attempt to restore the FY 1993 legislatively approved budget.
Chairman Arberry asked how the state's growth would impact the agency's budget projections. Mr. Tait stated room tax revenues had been projected to increase by 4.45 percent in FY 94 over the FY 1993 actual amount and 5 percent in FY 95. Mr. Tait indicated the projections reflected an increase in revenue from the new resorts in Las Vegas. These projections assumed some reallocation of market share between resorts. Chairman Arberry asked what percentage the room tax was presently generating. Mr. Tait replied the room tax revenue was at 6.6 percent over the actual revenue collected in FY 1992.
Chairman Arberry asked how the passport marketing concept would diversify the tourism industry in Nevada. Mr. Tait stated this was an attempt to promote rural Nevada through intra-state tourism. The agency was planning to produce 500,000 coupon books which will be distributed to Las Vegas, Reno and Lake Tahoe area residents. The coupon books would be used to promote rural Nevada and encourage Nevada residents to use rural Nevada as a weekend getaway.
Ms. Giunchigliani asked how the room tax was allocated. Mr. Tait stated if the room tax in Las Vegas was set at 8 percent the county would retain 7 5/8 percent and the state would receive 3/8 of 1 percent. Mr. Tait explained in the larger communities the proceeds went to the Convention and Visitors Authorities and in the smaller communities to the Fair and Recreation Boards. Ms. Giunchigliani commented the public perception of the room tax was that it was a high revenue generator for the redevelopment of the state when actually monies were utilized by the tourism industry alone. Ms. Giunchigliani stated she had received numerous complaints from constituents about the Las Vegas Convention and Visitors Authority's (LVCVA) use of funds. An example of this misuse was the requirement board members take two out of country trips per year accompanied by their spouses. Ms. Giunchigliani suggested the room tax revenues should be allocated directly to elected officials in the local government and county commissions, then allocated to the Visitors and Convention Authorities. Mr. Tait replied most Visitors and Convention Authorities' Boards had a preponderance of locally elected officials. Ms. Giunchigliani commented the funds were used by the LVCVA to promote their own industry when the public perceived the funds would be used in other areas.
Chairman Arberry asked for a brief explanation of the $175,000 request for the International Trade/Tourism category. Mr. Tait stated there were two overseas offices one located in Tokyo, Japan and the other in London, England. The Japan office's performance indicators included contacts with 919 tour wholesalers; 1,271 travel agents; 421 airline management personnel; 597 travel trade media; 247 contacts with consumer media; and 320 outside sales calls. The London Office performance indicators for the first year of operation included contacts with 334 travel wholesalers; 631 travel agents; 55 airline management personnel; 195 travel trade media; 154 consumer media and 904 sales calls. Mr. Tait indicated the above contracts could not have been established from the United States and would easily be five to ten times as expensive. He stated the LVCVA indicated the number of visitors from these countries were constantly rising.
Chairman Arberry asked if the LVCVA or the Reno Convention and Visitors Authorities (RCVA) were making contributions to the two overseas offices. Mr. Tait replied the LVCVA was in full cooperation and support for both of the offices. RCVA had elected not to participate in the overseas programs but did contribute to the Canadian outreach. Chairman Arberry asked how the costs were split between the Commission on Tourism and LVCVA. Mr. Tait stated the LVCVA would match $175,000 for every $75,000 the Commission provided for the Tokyo office, and $125,000 for every $100,000 contributed by the state for the office in London.
Mr. Spitler asked if the Commission on Tourism participated in special events planning such as boxing events. Mr. Spitler commented studies found such events promoted all areas of the gaming and tourism industry. Mr. Tait explained the Commission would participate in citywide events but typically boxing events were resort specific. The Commission would participate in events such as the national finals rodeo, cowboy poetry and world cup soccer. Most of the events in which the Commission participated were located in rural Nevada.
Mr. Marvel asked if the overseas activities had involved the Commission in some aspects of economic development. Mr. Tait stated only as tourism was an indicator of economic development. Mr. Marvel asked if the combination of the Commission on Economic Development and the Commission on Tourism would be beneficial. Mr. Tait stated the Lieutenant Governor had instructed him to meet with the staff of the Economic Development Commission to discuss the possibility. Mr. Marvel commented overseas travellers could also be investors which could bring industry to Nevada. Mr. Tait agreed the two agencies could work together to promote industry in Nevada, however clear areas of responsibility need to be established.
Ms. Giunchigliani asked if legislation would be needed to merge the two agencies. Mr. Tait replied the current statutes would have to be amended to merge the two commissions.
Ms. Giunchigliani questioned whether the performance indicators for the two foreign offices could include the number of trips which resulted from the contacts made by those offices. Mr. Tait commented the LVCVA's annual report stated 400,000 Japanese visitors came to Las Vegas in FY 92. He stated the Japan office had encouraged over 35,000 Japanese tourists to visit northern Nevada for the first time to ski. Mr. Tait commented Whistler, British Columbia had been marketing Japan for 10 years and had not enjoyed such a high number of Japanese tourists. Ms. Giunchigliani suggested these numbers be included in the agency's performance indicators.
NEVADA MAGAZINE - PAGE 607
Richard F. Moreno, Publisher, Nevada Magazine, remarked Nevada Magazine was established in 1936 by the state of Nevada as the Nevada Parks and Highways Magazine. Originally published by the Highway Department the intent of the publication was to encourage tourism. During the 1970's the magazine moved from a quarterly to a bimonthly publication. In 1983 the publication became part of the Nevada Commission on Tourism. Mr. Moreno stated the intent of the publication was to promote the attractions, activities and natural beauty of the state of Nevada. Mr. Moreno commented a recent survey conducted by the magazine revealed editorially balanced coverage of the state with 30 percent of the stories on Las Vegas and Laughlin, 25 percent on Reno and Lake Tahoe and 28 percent on rural Nevada. Mr. Moreno referred to the several publications Nevada Travel Update, Nevada Events and Nevada Magazine (Exhibit I) which are available for review in the Research Division of the Sedway Office Building, Carson City. Mr. Moreno stated 80 percent of the total circulation of the magazine was outside the state. Additionally Nevada Travel Update was circulated to 30,000 travel agents. Nevada Events is a comprehensive guide to all of the major events in the state. He commented the Commission on Tourism utilized Nevada Events as part of a basic information package.
Mr. Moreno explained the budget was designed to reflected very modest and realistic expenditures. The agency was proposing no new programs. He acknowledged the request for one new advertizing position which would be filled only if the funds were available. The remainder of the budget was based on the actual expenditures from FY 92 which represented a 20 percent decrease in the work program. The only enhancements included in the budget were in the travel and equipment categories. Mr. Moreno indicated the agency was in basic agreement with the Governor's recommendations.
Chairman Arberry asked the cost of a magazine subscription. Mr. Moreno explained rates were $2.95 at the newsstand and the subscription rate was $14.95 which included 6 issues and the bonus vacation planner. He commented these rates were based on the market rate and the agency did not plan to raise them over the biennium.
Mrs. Williams asked the agency if they were participating in "trade outs," which were magazine advertisements in exchange for airline travel. Mr. Moreno explained the magazine was authorized by statute to participate in up to $5,000 in in-state and out-of-state travel "trade outs." He indicated agreements had been made with America West Airlines and a proposal had been submitted to Southwest Airlines.
LABOR RELATIONS - PAGE 390
Frank MacDonald, Labor Commissioner, stated the agency was charged with the enforcement of the labor laws of the state which were not exclusively or specifically vested in any other board or commission. He stated the Labor Commission was directly responsible for regulation of private employment, issuance of producer/promoter permits, employment of minors, apprenticeship program registrations, licensing and regulation of private employment agencies, and the establishment and enforcement of prevailing wage rates on public works projects. The Commission also provided arbitrator and mediator lists to parties involved in labor disputes. The Labor Commissioner was charged with the appointment of the seven-member Nevada State Apprenticeship Counsel. Mr. MacDonald contended the Commission had a direct impact on private employees and employers of the state of Nevada. Mr. MacDonald commented uncollected wages had increased from $620,000 in 1983 to $1.4 million in 1991 and $1.3 million in 1992. He stated the agency must grow with the state and offer the highest possible level of service for the Nevada worker. Mr. MacDonald asserted nothing was more demoralizing to the family than not receiving a paycheck earned. He stated a delay in the payment of earned wages could also put an unnecessary burden on social services. Mr. MacDonald clarified the agency's purpose was to be a resource to the employee and not to be considered an instrument of punishment to the employers.
Mrs. Williams commented she had heard many objections to the proposed combination of the Employee Management Relations Board (EMRB) and the Labor Commission. She asked if the missions of both agencies could be combined since EMRB specialized in public sector employment issues and Labor Relations specialized in private sector employment issues. Mr. MacDonald said that the recommendation to combine the two agencies had come from the administration.
Mr. Spitler commented the proposed combination of the two boards would result in a net loss of two positions and a corresponding increase in work load. He asked how the agency would be able to provide services to the public without adequate staffing. Mr. MacDonald replied, "My honest opinion, I can't handle it." Mr. Spitler commented when an agency provides services to individuals who are least able to gain these services on their own, it becomes incumbent on the state to provide the agency with adequate funding. Mr. Spitler thanked Mr. MacDonald for his candid response.
Ms. Giunchigliani asked what the current backlog was on compliance investigations. Mr. MacDonald replied the agency was approximately 1,200 days behind on compliance investigations. Ms. Giunchigliani asked what the current backlog was on wage claim audits. Mr. MacDonald commented approximately 40 wage claim audits were pending. She asked if the Commission's auditors were recommended for transfer to the Department of Taxation. Mr. MacDonald clarified the agency had one auditor and the position was not recommended for transfer. Ms. Giunchigliani commented the agency obviously had not been able to adequately provide services and with the recommendation to combine the work load of the EMRB into the agency's work load the backlog could only escalate.
Ms. Giunchigliani asked the Budget Office if the regulatory function of the EMRB would remain intact. Mr. Thorne indicated the regulatory functions of the EMRB would remain intact. Ms. Giunchigliani asked Mr. Thorne if the Labor Commissioner would receive additional staff if the two commissions were combined. Mr. Thorne asserted the Labor Commission could provide the services with existing staff even after the addition of the responsibilities of the EMRB. Ms. Giunchigliani emphasized the 1,200 day backlog and maintained the situation would only become more severe if the two agencies were combined. Mr. Thorne maintained 1.6 full-time equivalent positions (FTE) would be transferred to the Labor Commission when the two agencies were combined. Ms. Giunchigliani asked if the Budget Division considered an agency's backlog when determining staffing levels. Mr. Thorne stated the Budget Division attempted to consider such items when constructing budgets, however limited funding did constrain budget allocations. Ms. Giunchigliani commented budget targets provided to the agencies by the Budget Division prevented the agencies from requesting appropriate funding without appearing to be in conflict with the Budget Division. Mr. Thorne asserted the intent of the agency's request was to reflect the needs of the agency. By contrast the governor's recommendation was to reflect both the needs of the agency and the funding available. Ms. Giunchigliani suggested altering the budget construction process in order to allow agencies to make direct requests to the Legislature. Mr. Thorne commented the way state government was currently run it was the Governor's position to propose and the Legislature's position to discuss. Ms. Giunchigliani asserted the current process did not allow for a true picture of the agency's needs.
Ms. Giunchigliani asked if insufficient staffing had limited compliance investigations to larger claims. Mr. MacDonald affirmed compliance checks were not performed. He added compliance investigations occurred only after a report was filed. Ms. Giunchigliani asked if the agency conducted outreach/education programs for private sector employers and employees. Mr. MacDonald stated the agency was not adequately staffed to enable any type of outreach program. Ms. Giunchigliani requested the agency prepare and submit an estimate of the budgetary requirements for an education/outreach program and backlog reduction.
Ms. Giunchigliani inquired whether the computer system could be utilized to compute prevailing wage estimates which would separate management and employee salaries. Mr. MacDonald explained the current computer system was extremely outdated and was not capable of complex calculations. Mr. MacDonald commented a computer hardware request had been included in the budget. Ms. Giunchigliani asked how prevailing wages were reported to the Labor Commission. Mr. MacDonald replied the agency utilized a certified payroll reporting system. Mr. MacDonald suggested the Employment Security Department may have the information Ms. Giunchigliani was looking for.
Mrs. Williams asked the Budget Office if the 1.6 positions transferred from EMRB to Labor Relations would be eliminated after October 1, 1993. Mr. Thorne affirmed the position would be eliminated after October 1, 1993. Mrs. Williams concluded if Labor Relations and EMRB were combined the responsibilities of both agencies would need to continue without additional support staff.
Mrs. Evans asked the Budget Office if public policy decisions were based strictly on numbers instead of a matter of good public policy. Mr. Thorne emphasized public policy was a major factor in determining budget allocations. However, finite revenues did constrain budget allocations and caused difficult choices to be made. Mrs. Evans commented agencies were paralyzed and ineffective when insufficiently funded. Mr. Thorne concurred this was certainly a problem and the options to the Legislature were: (1) change the funding distribution; (2) eliminate paper agencies; or (3) increase revenues. Mrs. Evans commented leadership needed to be taken in the process before The Executive Budget reached the Legislature.
Mrs. Evans asked if the Labor Relations and EMRB were combined would the board become advisory or regulatory. Mr. Thorne indicated the new board would perform the same regulatory functions. Mrs. Evans requested the Budget Office present the written information on the functions of the new board. She declared the Executive Budget in Brief publication provided by the Budget Office defined the new board as serving in an advisory capacity.
Mr. Heller cited performance indicator number 3, which listed the average number of days to close a wage claim from date of receipt. Mr. Heller asked how this could be accurate when the agency had a 1,200 day backlog. Mr. MacDonald asserted the numbers were correct. He explained an average claim was processed in 115 days in FY 92. He stated the agency's projections were formulated without reference to the EMRB consolidation impacts. Mr. Heller asked if the projections could be met if the merger of the two agencies occurred. Mr. MacDonald stated it was highly unlikely the projections would be met. Mr. Heller asked Mr. MacDonald to provide revised performance indicators which included the new caseload from the EMRB.
Mr. Perkins asked Mr. MacDonald to explain the 1,200 day backlog. Mr. MacDonald explained the estimate was cursory and composed of various types of claims pending investigation.
Mr. Perkins asked if the agency had been consulted regarding the consolidation of EMRB and Labor Relations. Mr. MacDonald stated the agency had not been consulted.
Ms. Giunchigliani asked if the Deputy Director of Labor Relations position would be filled. Mr. MacDonald explained if the merger of the two agencies occurred the Deputy Director's position would be filled with the current EMRB Commissioner.
Chairman Arberry commented because of the major concerns expressed by the committee, both the EMRB and Labor Commission would be called to testify at a later date.
Mr. Price asked if the functions of the Apprenticeship Council would continue in the same capacity. Mr. MacDonald stated the functions of the council would remain the same. Mr. Price asked the Budget Office to explain the purpose of the Labor Commission. Mr. Thorne explained the Commission's purpose was to ensure employers were in compliance with labor laws. Mr. Price agreed and concluded if the agency was understaffed and under-funded the workers of the state would suffer.
Mrs. Williams commented she shared Mrs. Evans concerns about under-funding of agencies and the resulting false expectations from the public.
RURAL HOUSING - PAGE 450
Robert Sullivan, Executive Director, Nevada Rural Housing Authority (NRHA), gave a brief review of the functions of the Rural Housing Authority Board. Mr. Sullivan explained the Board was fully accountable for the success and failures of the NRHA. He stated the NRHA was established in 1973 by the rural counties. He said the role of the Legislature was to provide personnel and certain oversight of the operations of the agency. He commented the accountability for the success or failure of NRHA remained with the Board. Mr. Sullivan commented the relationship between the Legislature and the Board was difficult to work with because the Board was held accountable for the actions of both bodies. Mr. Sullivan stated the NRHA budget had two components, the first provided by the state Budget Office and the second from the federal government. Mr. Sullivan referred to NRHA Fiscal Overview (Exhibit D and E) which displayed the federal budget which totaled approximately $6.3 million for each year of the biennium. He explained The Executive Budget funded central operations and personnel expenses which totaled approximately $700,000 in each year of the biennium.
Mr. Sullivan referred to a flow chart which explained NRHA divisions and program structure. He also referred to an NRHA pamphlet which described the clients and programs associated with the NRHA. He explained the NRHA provided assistance to approximately 1,000 rural Nevada families through low income rental assistance. He commented the rehabilitation program, funded by the federal government, required administration by a Housing Development Officer. Due to problems with the proper classification by the Department of Personnel the position remained vacant which threatened federal funding for the program. Currently services for the rehabilitation program were provided by other members of the NRHA staff to Fernley, Ely, Lovelock, and Yerington. Mr. Sullivan indicated funding was available for Wells and Hawthorne which had not been distributed due to personnel limitations.
Mr. Sullivan stated the NRHA was in a federal/state cooperative agreement which dated back to 1937. Mr. Sullivan stated the cooperative agreement had been the subject of many studies conducted by the Nevada Legislature, National Development Law Institute and federal funding agencies.
Mr. Marvel asked Mr. Sullivan to speculate whether more federal funds would be available if the agency had no state affiliation. Mr. Sullivan commented lack of state affiliation would make the agency eligible for additional federal funding. However the issue was not additional federal funding but the amount of time required to fill essential positions. For example positions approved by the 1991 Legislature remained vacant. He stated inequitable pay was another personnel issue. An example, a painter in the Nevada state system was classified at a grade 30. However, the NRHA's maintenance chief position had been recommended at a grade 27 and was responsible for air conditioning, heating, painting, and electrical repairs. He said to make matters worse the maintenance chief's assistant was also classified at a grade 27 in the state's personnel system.
Mr. Marvel asked if the NRHA employees were in favor of eliminating state affiliation. Mr. Sullivan explained the majority of the employees would prefer to remain with the state employee classification system.
Mr. Marvel commented he was sponsoring a bill which would separate the NRHA from the state. Mr. Marvel asked if NRHA would lose many staff members if they were no longer part of the state classification system. Mr. Sullivan speculated because the agency had experienced such low employee turnover, 75 percent of the employees would remain in their current positions.
Mr. Sullivan commented the purpose of the Governor's proposed reorganization had baffled the agency. In addition, Mr. Sullivan explained the NRHA was responsible for providing audit reports to federal funding agencies. Enhancement 710 would compel the NHRA to pay $5,000 per year to the state for single audit expenses. He stated this was a ludicrous proposition since the NHRA performed internal audits which were funded by the federal government. Another critical budget issue according to Mr. Sullivan was the salary compensation for the Executive Director's position. He commented the position was originally classified at grade a 37 and was changed to an unclassified position. Currently a grade 37-15 is compensated at a higher level than what is recommended for the unclassified salary of the Executive Director.
Mr. Sullivan argued the NRHA provided necessary services to the low income population of the state which alleviated some social service responsibilities from other agencies within the state. Mr. Sullivan asserted insufficient funding had curtailed the agency's ability to expand its programs. Mr. Sullivan explained most of the Governor' recommendations reflected the agency's requests. The exception was the request for additional compensation for the Executive Director's position. He commented the agency had neglected to request compensation for the NRHA Commission which was a $1,500 per year expense. Mr. Spitler requested the agency submit a revised budget request for the Commission expenses.
Mr. Spitler requested written information regarding the agency's requests and funding requirements to improve the services of NHRA. Mr. Sullivan explained the information was contained in a supplemental document titled "Background on a Path to Improved Productivity and Accountability for the Nevada Rural Housing Authority."
Jim Regan, Commissioner, Nevada Rural Housing Authority, concurred with the concerns Mr. Sullivan had expressed. Mr. Regan commented on the excellent work the Executive Director was providing to the NRHA and requested additional compensation for the position.
NEVADA ATTORNEY FOR INJURED WORKERS - PAGE 455
Nancyann Leeder, Nevada Attorney for Injured Workers (NAIW), indicated the purpose of the agency was to represent injured workers in their efforts to achieve workers compensation benefits. The agency's authority was unaffected by the reorganization. She stated the 1991 Legislature expanded the insurer's authority to include a vocational rehabilitation buy out option. The option would allow workers to waive future benefits. The injured workers required attorney services to legally waive benefits which had subsequently increased NAIW's work load (Exhibit F, page 1). Ms. Leeder stated the advisory functions of the agency had increased significantly which led to the development of "Important Points about Your Hearing Before the Hearing Officer" (Exhibit J) on file at the Research Division).
Ms. Leeder indicated because of the increased work load NAIW attorneys had been reassigned to the Carson City office. Ms. Leeder added she personally worked on any increased caseload in the Las Vegas area. Enhancement 799, would provide for the increase in in-state travel which was requested at approximately $11,000 in FY 94 and $13,000 in FY 95.
Ms. Leeder referred to page one of Exhibit F and commented the NAIW's caseload had doubled since 1989, and a 150 percent increase had occurred since 1990. She clarified the cases listed were representative of those cases the agency had been appointed to represent and did not include cases at the District or Supreme Court levels. Ms. Leeder stated the budget projections for FY 91-93 were based on a 31 percent increase in caseload. As a result the length of time required to service clients had increased. For example, four years ago a case could be prepared in two months. Now the same case would take approximately five months.
Ms. Leeder highlighted the $66,000 increase in operating would be used for library updates, training and postage. Ms. Leeder commented many of the attorneys provided office furnishings and law books at their own expense.
Mr. Spitler commended the agency for the services provided to the citizens of Nevada. Mr. Spitler asked if the new computer system had been installed. Ms. Leeder replied computers had been installed in both the Carson City and Las Vegas offices. She indicated the software was being adjusted to meet the needs of the agency. Mr. Spitler asked if the system could develop reports which detailed the amount of work produced by the agency. Ms. Leeder commented databases were being developed.
Ms. Tiffany asked if budget projections had anticipated impacts of the expanded hotel industry in the Las Vegas area. Ms. Leeder stated if the caseload remained at its current level, additional funding would have to be requested during the interim. Ms. Tiffany asked if the agency would be able to continue to service clients if staffing and caseload levels remained constant. Ms. Leeder replied the types and number of cases serviced would need adjustment. She suggested some of the caseload could be reduced if cases could be settled by a mediator and more cases could be screened out if discovery documents were delivered in a timely fashion. Ms. Leeder commented only 17 percent of the cases had been screened out over the last biennium.
Ms. Tiffany asked how the computer allocation was used. Ms. Leeder replied most was used to purchase hardware, WordPerfect and FoxPro. The FoxPro program was intended to extract data in a variety of ways. However, when the system was installed by the Department of Data Processing, it did not function in that manner and required servicing to extract data. Ms. Tiffany requested an information update on the computer system.
Ms. Giunchigliani asked what additional positions would be funded by the personnel enhancement. Ms. Leeder replied two attorneys and one accounting clerk would be funded by the enhancement. Ms. Giunchigliani asked if legislation currently under review contained provisions to allow cases to be stipulated by the mediator. Ms. Leeder confirmed legislation was pending. Ms. Giunchigliani noted none of the enhancements had been recommended by the Governor. Ms. Leeder replied with the exception of out-of-state travel all of the enhancements were required to fund the 3 requested positions. Ms. Leeder noted the requested positions had not been recommended by the Governor.
Ms. Giunchigliani asked if additional staff and in-state travel requests were denied, how would the agency service southern Nevada. Ms. Leeder replied staffing levels in the northern and southern offices would be equalized regardless of caseload. Ms. Giunchigliani asked the average caseload per attorney. Ms. Leeder replied the caseload should be 75 per attorney but had increased to 100 cases per attorney. Ms. Giunchigliani asked if the administrative duties were neglected in order to assist with the increased caseload. Ms. Leeder stated she had to do a great deal of work on her off hours.
Mrs. Evans asked the average length of time it took to process a claim. Ms. Leeder replied an injured worker at the pre-hearing officer level was mailed an information pamphlet. Vocational rehabilitation buy-out information was given in group seminars. These seminars were scheduled on an as-needed basis and the average worker waited approximately one week to attend. If the NAIW was appointed to represent an injured worker the agency was required to respond immediately. She commented discovery documents were typically not received until shortly before the hearing which severely impaired the hearing process.
Mrs. Evans asked how the agency was able to service the increased caseload. Ms. Leeder commented during an eight month period agency staff had worked full-time plus an additional 11.5 months of overtime. Mrs. Evans requested a report detailing the agency's overtime for the past year.
Mrs. Evans noted salary compensation for this agency's attorneys was $6,000 less than salaries for SIIS attorneys. Ms. Leeder asserted the agency's attorneys were paid less and had fewer staff members to assist in the preparation of the cases. Mrs. Evans asked the Budget Office if any effort had been made to parallel the attorney's salaries. Mr. Thorne stated the outcome of the SIIS reforms could have an impact on personnel expenditures for the agency. Mr. Thorne indicated a request to raise the attorney's salaries had not been submitted to the Budget Office, therefore the issue had not been addressed. Mrs. Evans asked the agency to submit a report addressing the attorney salaries.
INDIAN COMMISSION - PAGE 1013
Gerald W. Allen, Acting-Director, Indian Commission, presented a memorandum to the committee (Exhibit G), which described the mission, purpose and programs of the Indian Commission. Mr. Allen stated the Commission was formed at the request of the Indian people in 1965 to represent them in state government. Mr. Allen referred to a set of resolutions prepared by the Governing Body of the Inter-Tribal Council of Nevada which opposed the merger of the Nevada Indian Commission with the Department of Education, Health and Human Service and opposed the relocation of the Indian Commission.
Mr. Allen commented the Commission had three requests:
(1) The Executive Director's position be reinstated.
(2) Staffing levels be returned to the FY 91-93 levels, which included an Executive Director, Education and Information Officer, and a Management Assistant I. Currently the staff consists of an Acting-Director and a Management Assistant I. A full administrative staff was requested to enable the Commission to provide needed services to the Indian citizens of Nevada.
(3) The Commission location remain in Reno because it is centrally located and accessible to the Indian population.
Mr. Spitler agreed with the Commission's request for the Executive Director. Mr. Allen commented the Executive Director's position was vital because it acted as a liaison between the state and the Indian people.
Mr. Marvel asked where the new office would be located. Mr. Thorne indicated the Commission would be located in the Kinkead Building, Carson City.
Mr. Marvel asked if the Commission worked closely with the Bureau of Indian Affairs. Mr. Allen stated the Commission had a good relationship with the Bureau of Indian Affairs.
Mr. Perkins asked if the base budget included funding for the Executive Director's position. Mr. Thorne explained the position would have to remain vacant to meet the budget target assigned by the Budget Division. However, other areas of the budget would have to be reduced if the agency chose to fill the Executive Director's position. Mr. Thorne stated the Budget Office had recommended it remain a two person staff. Mr. Perkins questioned why 2.75 full-time equivalent (FTE) positions were listed in the agency's budget. Mr. Thorne explained the Executive Director position was statutorily required, therefore the position could not be eliminated.
There being no further business, the meeting was adjourned at 10:25 a.m.
RESPECTFULLY SUBMITTED:
_________________________
Courtnay Berg
Committee Secretary
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Assembly Committee on Ways and Means
March 19, 1993
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