MINUTES OF THE

      ASSEMBLY COMMITTEE ON WAYS AND MEANS

 

      Sixty-seventh Session

      April 6, 1993

 

 

The Assembly Committee on Ways and Means was called to order by Chairman Morse Arberry, Jr., at 7:34 a.m., on Tuesday, April 6, 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

     

 

ASSEMBLY BILL 97 -      Specifies amount to be paid by certain public employers for group insurance for public employees for next biennium.

 

Mr. Bob Gagnier, Executive Director, State of Nevada Employees Association (SNEA), explained SNEA had requested AB 97 in response to the action of the Committee on Benefits to increase dependent premiums and lower benefits of employee health insurance.  AB 97 was a bill to increase the state contribution for health insurance for state employees in order to increase benefits and reduce premiums to original levels.

 

Mr. Gagnier indicated the state currently contributed $213.75 per employee.  AB 97 would increase the contribution amount by $61.25 in the first year of the biennium and an additional $49.00 in the second year.  Those increases were necessary to restore most of the benefits which were cut on January 1, 1993, and to lower the family premiums which had been increased at that time.

 

Mr. Gagnier noted the Administration had proposed no increased contribution in the Executive Budget for the first year of the biennium and an increase of $12.75 in the second year of the biennium.  He said the Administration was asking state employees and their dependents to assume all of the increased costs of uncontrolled health care inflation in Nevada.  SNEA's position was the employees had already done their share.

 

Mr. Gagnier stated over the past two legislative sessions the Administration had proposed contribution amounts which were insufficient and required drawing down of health care reserves.  He noted he had warned this committee in 1991 the insufficient funding would require SNEA to request substantial increases in 1993.

 

Mr. Gagnier distributed copies of a document entitled "SNEA Information on Health Insurance" (Exhibit C).  He referred to Chart "A" of Exhibit C, a schedule of state contributions since 1987.  He pointed out the contributions for fiscal years 1991-92 (5.2%) and 1992-93 (4.9%) were considerably below the rate of medical inflation.

 

Mr. Gagnier then referred to Chart "B" of Exhibit C, which listed benefit changes and rate increases which took effect January 1, 1993.  He pointed out the Committee on Benefits had postponed $100.00 of the proposed $176.46 increase in premiums for employee, spouse and children.

 

Mr. Gagnier noted state employees had not received a cost-of-living increase since 1991 and in all probability would not receive a cost-of-living increase during the coming biennium.  If AB 97 was not passed, the Legislature and the Administration would be cutting employee compensation even further.

 

Mr. Gagnier referred to Chart "C" of Exhibit C, a comparison of state and local government salaries.  State salaries, on average, were 22 percent below entry-level salaries and 26 percent below top range salaries of local governments.  Chart "D" of Exhibit C demonstrated those averages were increasing and state salaries were falling further behind local government salaries.

 

Mr. Gagnier referred to Charts "E" and "F" of Exhibit C, which provided comparisons of amounts paid for health insurance premiums by private industry, other states and Nevada local governments.

 

Mr. Gagnier stated SNEA was aware of the high cost of passage of AB 97.  He referred to Chart "G" of Exhibit C, which demonstrated the fiscal ramifications of the bill.

 

Mr. Gagnier indicated for state employees AB 97 was the most important bill of the 1993 legislative session.  State employees were looking to the Legislature for relief from continued lost compensation.

 

Mrs. Evans said she was aware the reduced state contribution toward health insurance had been devastating to many people who were forced to drop medical insurance coverage for family members.  She noted having people go without health insurance was of grave concern to the Legislature.  She questioned how health care proposals at the national level would impact the state health plan.

 

Mr. Gagnier replied SNEA's proposal could not be predicated on what might happen at the national level.  He expressed doubt that a national health plan would help the state hold down health care costs.  Presumably, the national plan would propose helping those people without access to health insurance.

 

Mr. Perkins asked what the employee contributions toward health insurance premiums were in the local governments.  Mr. Gagnier responded in most instances there was no out-of-pocket expense for employees unless they selected an HMO plan.  Mr. Perkins inquired whether employees paid for dependent coverage.  Mr. Gagnier replied in some instances employees did not pay for dependent coverage.

 

Mr. Gagnier pointed out the $250.00 deductible for the state plan was considerably higher than the deductibles of the local government plans.

 

Mr. Fred Suwe, member of the Committee on Benefits, reported the Committee on Benefits supported AB 97.  He explained two key issues were managed care and the amount of the employee's out-of-pocket expense for dependent coverage.  He indicated the Committee on Benefits would continue to encourage managed care for plan participants.  The issue addressed by AB 97 was how much plan participants had to pay for dependent coverage as well as restoration of benefits which had been reduced due to lack of funds.  He encouraged the committee to give serious consideration to AB 97.  Without passage the Committee on Benefits would have no choice but to continue to reduce benefits and raise dependent, and possibly employee, premiums.

 

Ms. Giunchigliani inquired about single employees subsidizing dependent coverage.  Mr. Suwe responded it had always been a policy to subsidize dependent coverage from lump sum state contributions per employee.  This policy allowed the greatest flexibility in plan design.

 

Ms. Giunchigliani asked why employees had to pay out-of-pocket expenses for HMO coverage.  Mr. Suwe replied the HMO rate was higher than the self-funded plan rate.

 

Ms. Giunchigliani questioned whether HMO contracts were negotiated annually.  Mr. Suwe responded affirmatively.  He noted there was currently only one HMO provider in northern Nevada and two in southern Nevada.

 

Mr. Price asked if there were any plans which charged different base amounts for single employees and employees with dependents and whether premiums varied according to the number of dependents.  Mr. Suwe responded dependent rates were based on projections of expenses.  The reason the Committee on Benefits had distinguished between premiums for spouses and children this year was because an actuarial analysis determined the rate of use was higher for spouses than for children.  He explained there was no distinction between one child or many children because actuarially there was no significant difference.  The Committee on Benefits was attempting to keep the plan design simple.

 

Mr. Jim Richardson, Nevada Faculty Alliance, stated he was a former chairman of the State Insurance Committee and was familiar with health insurance issues.  He said he had come before the committee to plead for passage of AB 97.  He said he appreciated the budget problems which faced the committee, but it was ludicrous to assume there would be no medical inflation in the coming year and, therefore, the Executive Budget was clearly a recommendation to cut compensation to state employees.  He noted this cut was as high as five or six percent for some classified employees with dependents.

 

Mr. Richardson mentioned the state contribution subsidized retirement insurance benefits as well as dependent coverage.  Pre-funding of retirement medical insurance premiums was being seriously jeopardized by the reduced state contribution.  He noted part of the Budget Division's rationale for not increasing the medical insurance contribution in fiscal year 1993-94 could be the dramatic change of philosophy adopted by the Committee on Benefits that retirees and dependents should pay their own premiums.

 

Mr. Richardson urged the committee to look seriously at this matter.  He said he knew of no other issue which had engendered as much concern on university and community college campuses as had AB 97.

 

Chairman Arberry said the committee appreciated the concerns of the witnesses.  He indicated the committee was compassionate about this issue; however, it was difficult to fund any additional items.  He stated the committee would take a hard look at this issue but he could not make any promises.

 

Mrs. Evans stated the silence of the committee members said a great deal.  She said the amount needed to pass AB 97 was a sobering number but this was a priority item for her.

 

Mr. Wally Tarantino, representing various organizations, said he applauded SNEA for taking a leadership role in introducing AB 97.  He stated the groups he represented considered this the single most important issue of the 1993-95 biennium.  He reiterated state employees would be experiencing a three-year period without a cost-of-living increase.

 

Ms. Lori Bagwell, Nevada Highway Patrol Association, stated this was also the highest priority issue for her group.  She indicated a recent survey of her membership showed 14 of 289 members had found it necessary to drop dependent health insurance coverage as a result of rate increases.  She expressed concern the proposed increase in July 1993 would cause more members to do the same.

 

Ms. Bagwell noted the people who were dropping insurance coverage were those who were not currently utilizing the system.  Those who retained coverage were utilizing the system and causing the increases in health care costs.

 

EMPLOYEE-MANAGEMENT RELATIONS BOARD - PAGE 1717

 

Mr. Mike Garmon, Commissioner, Local Government Employee-Management Relations Board (EMRB), introduced Ms. Tamara Barengo, Vice Chairman of the Board.

 

Mr. Garmon distributed to the committee copies of a letter from EMRB Chairman Salvatore Gugino expressing the chairman's concerns about the Governor's proposed reorganization plan as it pertained to EMRB (Exhibit D).  He also distributed copies of his own letter to Chairman Arberry on the matter (Exhibit E).  He noted he had been provided only sketchy information about the proposed reorganization.  He said he was uncertain how it was contemplated the services of the EMRB would be performed following the proposed reorganization.  He expressed serious doubts about the ability of the Labor Commissioner to assume the duties of the EMRB support staff as the Governor proposed.

 

Chairman Arberry noted the Labor Commissioner had previously indicated he could not absorb the work of the EMRB.  Mr. Garmon said he had not been provided official notice to that effect.

 

Chairman Arberry asked Mr. Garmon to state his concerns regarding the proposed reorganization and if he could offer any solutions to the problems.

 

Mr. Garmon stated the Governor's proposal had been represented as the recommendation of the independent commission appointed to study reorganization.  He pointed out the consultant, KPMG Peat Marwick, had agreed with the EMRB's position that it should remain an independent, autonomous and fully-funded agency.  There was no recommendation from the consultant to change the structure of the EMRB in any way.  The Governor's proposal was contrary to the consultant's report.

 

Mr. Garmon expressed concern no adequate study had been made to determine the function of the EMRB and that information would have to be known before a determination could be made regarding the Labor Commissioner absorbing that function.  He stated he was unaware of any study to determine if the Labor Commissioner had the resources to absorb the work of the EMRB.

 

Mr. Marvel questioned whether merging the EMRB with the Labor Commission represented a conflict of missions.  He said the current arm's-length objectivity could be lost in the merger.  He questioned the objective of the proposed merger.

 

Mr. Garmon said he believed there was some misunderstanding regarding the mission and activities of the EMRB.  He indicated it was possible the Governor's proposal was based on agency reports of activities.  He noted the EMRB had been unable to meet projections of activities in recent years.  This situation could indicate to someone unfamiliar with the work of the EMRB support staff that work load had fallen off to the extent the agency could no longer be justified.  He stated this scenario was far from the truth.

 

Mr. Garmon stated the Governor should have considered the provisions of NRS 288 and the Nevada Administrative Code prior to proposing the merger.  He noted NRS 288.110 established time limits for conducting hearings and rendering decisions.  The EMRB support staff was responsible for complying with those time limits.  He questioned who would perform this function if the EMRB staff was eliminated.  Additionally, NRS 288.165 and NAC 288.147 required local government employers and employee organizations to file certain annual reports with the EMRB and without staff there would be no one to receive and maintain those records.  He cited other similar examples and questioned whether the statute and Code would have to be amended to conform with the Governor's proposal.

 

Mr. Dini stated a substantial amount of expertise and case law had been developed within the EMRB over the years and a good statute regarding local government employee-management relations was in place.  He said he had no doubt the Labor Commissioner could assume the responsibilities of the EMRB; however, the public employees throughout the state would suffer from the loss of the quality performance of the EMRB.  He suggested the committee take the position it would not support the merger of the EMRB into the Labor Commission.

 

Mr. Price said the Governor's proposed reorganization plan did not address the ethics and appropriateness of combining certain agencies.  He noted the mission of the Labor Commission was to protect Nevada workers.  The mission of the EMRB was to render timely decisions regarding labor disputes between local government employers and employees.  He said it was inappropriate to place the hearings board in the position of being represented by the representative of one of the parties to the dispute.  He indicated he concurred with Mr. Dini in opposing the proposed merger.

 

Ms. Giunchigliani said she echoed the sentiments of Messrs. Dini and Price.  She pointed out while the proposed reorganization seemed logical on paper it did not truly represent the functions of the various agencies.  What appeared to be like functions could have significantly different applications.

 

Ms. Giunchigliani expressed her opinion the Labor Commissioner's office had been understaffed and it was irresponsible to add new and different functions to its job responsibilities.

 

Mr. Perkins noted the priorities of the proposed reorganization were to create efficiency and economy in state government.  He said while there might be some budget savings from the proposed merger, he did not foresee any efficiency.  He questioned the need to change the structure of the EMRB.

 

Chairman Arberry asked Mr. Garmon if the agency request represented sufficient funding for the EMRB.  Mr. Garmon replied the agency request would be sufficient if no other responsibilities were added as a result of pending legislation and if there was no large influx of unfair labor practice complaints.  He explained AB 242 related to proposed collective bargaining rights for state employees and, if enacted, would require administration similar to that required by NRS 288.

 

Ms. Barengo expressed the Board's support for Mr. Garmon and the Board Secretary.

 

Ms. Giunchigliani noted passage of AB 242 would require drafting of a fiscal note and the agency could appear before the Interim Finance Committee for additional funding.

 

Chairman Arberry called for public testimony.

 

Mr. Mike Johaneson, Service Employees International Union, stated his organization represented over 5,000 people who were directly affected by the work of the EMRB.  He expressed gratitude to the committee for their support of the EMRB.

 

Mr. Al Bellister, Nevada State Education Association (NSEA), stated the EMRB had done an excellent job of providing expeditious dispute resolution for public employees.  He said NSEA did not wish to see the relationship change.  He thanked the committee for its support.

 

Chairman Arberry asked Mr. Garmon to work with fiscal staff to develop the agency budget.

 

LABOR RELATIONS - PAGE 390

 

Chairman Arberry noted the Labor Commissioner had been invited to appear before the committee to discuss the proposed merger with the EMRB.

 

Mr. Marvel questioned whether funding had been transferred to the Labor Relations budget to maintain the function of the EMRB.

 

Mr. Frank MacDonald, Labor Commissioner, replied additional monies were transferred into the Labor Relations budget to cover expenses and travel.  He projected a reserve balance for fiscal year 1993-94 of 7.95 percent for both the Labor Commission and the EMRB.  The projected reserve for fiscal year 1994-95 was 2.15 percent or approximately $2,698.

 

Mrs. Williams inquired whether the Labor Commission could perform the work of the EMRB.  Mr. MacDonald stated it was his understanding the EMRB was a half-time agency and it would be possible for the Labor Commission to assume this function.

 

Mrs. Williams stated the EMRB performed a service to the public.  She asked if the Labor Commission could adequately render that service, especially considering the differences in the missions of the two agencies.  Mr. MacDonald stated he had offered a deputy labor commissioner position to the EMRB Commissioner.  If the EMRB Commissioner accepted that position, the transfer could be accomplished fairly smoothly.  If the EMRB Commissioner elected not to accept that position, it would be difficult to train someone to assume the position.

 

Mrs. Williams inquired about the backlog in the Labor Commissioner's office.  Mr. MacDonald replied his office had a backlog of 1,265 days total or 316 days per investigator.

 

Mrs. Williams asked what would happen to the backlogs in both offices if the EMRB was merged with the Labor Commissioner's office.  Mr. MacDonald stated the backlog in his agency consisted of wage claims.  The backlog in the EMRB related to hearings.

 

Mrs. Williams asked how the time frames for providing the services of both agencies would be increased by the merger.  Mr. MacDonald responded he did not know the present backlog of the EMRB.  The merger would add responsibility to the Labor Commissioner's office but the investigators would not be involved in those additional responsibilities and their backlogs would not be affected.  The deputy labor commissioner would be responsible for assuming the work of the EMRB.

 

Mr. Dini noted the expanded budget narrative indicated the Labor Commissioner's office had been unable to meet several intended goals due to budget reductions in fiscal year 1992-93.  He questioned how the Labor Commissioner's office could assume the duties of the EMRB when it was already overburdened.  Mr. MacDonald said it would be difficult to assume the added duties.

 

Mr. Dini expressed concern the merger would destroy the effectiveness of both agencies because Labor Relations funds would have to be expended to pay the part-time EMRB Commissioner.

 

Mr. MacDonald indicated the monies for personnel expenses being transferred from the EMRB budget would fund the secretary and commissioner positions until October 1, 1993.

 

Ms. Giunchigliani inquired how the deputy commissioner could handle both the duties of the EMRB and Labor Relations cases.  She noted previous testimony indicated the Labor Commissioner's office was currently only able to monitor large businesses and small and medium-sized businesses were not being served.  She said agencies were being created which existed on paper but were not sufficiently funded to perform their function.

 

Ms. Giunchigliani asked Mr. MacDonald if Labor Relations caseloads could have been adequately handled if the budget had not been cut $110,000 in 1992.  Mr. MacDonald indicated five people had been lost from his staff as a result of the budget cuts.

 

Ms. Giunchigliani expressed the opinion that funding should be reinstated in some agency budgets.  She suggested the five staff members should be added back to the Labor Relations budget.

 

Mr. Price expressed his admiration for Mr. MacDonald's ability, honesty and integrity.  He asked Mr. MacDonald if he agreed the proposed merger was inappropriate.  Mr. MacDonald replied the EMRB and the Labor Commission were two different bodies.

 

BOARD OF CONTRACTORS - PAGE 523

 

Mr. Robert Weld, Executive Director, State Contractors Board, introduced Mr. Bob Campbell, Chairman of the Board, and Ms. Margi Grein, Director of Finance.  He distributed to the committee copies of the Board's Statistics Report (Exhibit F).

 

Mr. Campbell explained the Legislature enacted the statute (NRS 624) which formed the State Contractors Board in 1941.  The Board was created for the protection, health, safety and general welfare of all persons dealing with those engaged in the construction industry.  The Board was comprised of seven members, including six contractors and one member of the general public.  Licenses issued by the Board provided assurance of a contractor's qualifications and financial responsibility.  Licenses were issued following successful completion of written examinations, investigation of experience and financial responsibility.  Staff investigators assisted consumers in disputes with contractors.  The Board had the power to suspend or revoke licenses of contractors who failed to comply with the law.

 

Mrs. Chowning asked how many licenses had been suspended in the past five years.  Mr. Campbell responded revocation of licenses occurred, on average, approximately once per month.  He referred to Exhibit F.  Mrs. Chowning inquired what percentage of investigations resulted in suspension of licenses.  Mr. Campbell estimated the percentage was very low.  Most contractors were willing to correct problems rather than lose their licenses.

 

Mr. Weld noted the Board and staff recommended this account be adopted as presented in the Executive Budget with the exception of the administrative assessment fee.

 

Chairman Arberry inquired what the Board believed would be a reasonable assessment.  Mr. Weld replied assessments were to fund additional staff to oversee the budgeting process.  He reported the Board had received the additional staff support only three times in the past two years.  He expressed his opinion the Board and staff were capable of adequately managing the agency budget.  He stated the agency had received no services for the assessment it was being charged.

 

Mr. Price asked if the Board handled complaints regarding unlicensed contractors.  Mr. Campbell answered the Board did file reports against unlicensed contractors with the city governments.  He noted a bill had been drafted to allow Contractors Board investigators to issue citations against unlicensed contractors.  Complaints were currently handled by district attorneys, who did not have the time to prosecute those cases.

 

Ms. Grein indicated the bill would be introduced in the coming few weeks.  The Board was anxious to receive authority to issue citations against unlicensed individuals.  She noted the Board had requested funding for a public education program.

 

Mr. Campbell pointed out the Contractors Board was funded entirely by fees from contractors.

 

Chairman Arberry inquired whether the assessment would fund two full-time positions to provide budget assistance.  Mr. P. Forrest "Woody" Thorne, Deputy Budget Administrator, Budget Division, answered a full-time position had been added to the Business and Industry budget to provide administrative support to the occupational boards.  The calculation to determine the assessment against the occupational boards was based on relative budget size.

 

Chairman Arberry inquired about the existing position.  Mr. Thorne replied the existing position resided within the Budget Division and the assessment was based on the percentage of time spent working on the Board and Commission budgets.

 

Mr. Marvel asked if the assessment was included in operating expenses.  Mr. Weld responded affirmatively.  Ms. Grein stated the total assessment for the biennium was $46,474.  The assessment was originally $10,000 and had increased each year.

 

Mr. Marvel questioned if the Board had its own internal and independent accounting and if the assessment was to pay for the same function.  Ms. Grein responded affirmatively.

 

 

      BUDGET CLOSINGS

 

SPECIAL FUND - PAGE 28

 

Chairman Arberry asked for comments from staff.  Mr. Stevens indicated staff had no comments on this budget.

 

      MR. MARVEL MOVED TO CLOSE THE SPECIAL FUND BUDGET AS RECOMMENDED BY THE GOVERNOR.

 

      MRS. EVANS SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

CLEAR CREEK YOUTH CENTER - PAGE 300

 

      MRS. EVANS MOVED TO CLOSE THE CLEAR CREEK YOUTH CENTER BUDGET AS RECOMMENDED BY THE GOVERNOR.

 

      MR. SPITLER SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

HIGH SCHOOL RODEO - PAGE 573

 

      MR. MARVEL MOVED TO CLOSE THE HIGH SCHOOL RODEO BUDGET AS RECOMMENDED BY THE GOVERNOR.

 

      MRS. EVANS SECONDED THE MOTION.

 

      THE MOTION CARRIED.  MR. PERKINS AND MR. SPITLER VOTED NO.

 

      BUDGET CLOSED.

 

NEVADA JUNIOR LIVESTOCK SHOW BOARD - PAGE 578

 

      MR. MARVEL MOVED TO CLOSE THE NEVADA JUNIOR LIVESTOCK SHOW BOARD BUDGET AS RECOMMENDED BY THE GOVERNOR.

 

      MRS. EVANS SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

TAXICAB AUTHORITY - PAGE 584

 

Chairman Arberry asked for comments from staff.  Mr. Stevens noted the committee had discussed adding the budget enhancement of $11,380 each year for Senioride to the base budget, increasing total expenditures for Senioride to $300,000 each year.  He said staff was concerned projections of trip charge revenue were low and suggested those revenues be increased to $55,000 each year.  He explained the Fiscal Division calculation was based on projections of 10 million trips in the first year of the biennium and 10.3 million trips in the second year at the rate of $.15 per trip.

 

Ms. Giunchigliani noted there was a bill draft to include Reno cabs under the jurisdiction of the Taxicab Authority rather than the Public Service Commission.  She questioned whether the bill would have an impact on this budget.  Mr. Stevens replied passage of the bill would impact the budget.  The matter could be handled by closing the budget and building necessary funding into the bill.

 

Mr. Spitler pointed out the Public Service Commission did not regulate cabs the way the Taxicab Authority did and if the bill passed, a completely different funding mechanism would be in place.  Funding could be moved from the Public Service Commission budget but additional funding would be required.

 

      MR. MARVEL MOVED TO AMEND THE TAXICAB AUTHORITY BUDGET TO INCREASE TRIP CHARGE REVENUE AND SENIORIDE EXPENSES PURSUANT TO THE RECOMMENDATIONS OF FISCAL STAFF AND CLOSE THE BUDGET AS AMENDED.

 

      MRS. EVANS SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

COMMITTEE TO HIRE THE HANDICAPPED - PAGE 1116

 

Ms. Giunchigliani expressed concern about the level of staffing funded by this budget.  She noted two people would be responsible for handling all Americans With Disabilities Act issues.

 

Chairman Arberry deferred action on this budget.

 

CAREY ACT - STATE LANDS - PAGE 1568

 

Chairman Arberry asked for comments from staff.  Mr. Stevens noted there was a question regarding whether funding for State Lands staff time could be charged to this budget.

 

Chairman Arberry deferred action on this budget.

 

HEIL WILD HORSE BEQUEST - PAGE 1616

 

      MR. PERKINS MOVED TO CLOSE THE HEIL WILD HORSE BEQUEST BUDGET AS RECOMMENDED BY THE GOVERNOR.

 

      MR. SPITLER SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

MINING COOPERATIVE FUND - PAGE 1633

 

Chairman Arberry asked for comments from staff.  Mr. Stevens indicated the budget had been revised by the Budget Division to reduce operating expenses and increase reserve $37,155 in the first year of the biennium and $44,310 in the second year.  He said there were no General Fund dollars in the account for the coming biennium.

 

      MR. SPITLER MOVED TO CLOSE THE MINING COOPERATIVE FUND BUDGET AS REVISED.

 

      MS. GIUNCHIGLIANI SECONDED THE MOTION.

 

      THE MOTION CARRIED UNANIMOUSLY.

 

      BUDGET CLOSED.

 

 

Chairman Arberry asked Mr. Stevens to report on revenue projections.  Mr. Stevens said he would be making a more detailed report when additional sales tax revenue and gaming revenue figures became available; however, since the committee was closing budgets it was important to know the current status of revenue projections.

 

Mr. Stevens distributed copies of a comparison of Budget Division and Fiscal Division projections (Exhibit G).  He explained the committee could use either of the projections, provided they did not choose the highest projection in each category.  He noted the Budget Division projections included proposals by the Governor to enhance revenue from slot taxes, sales tax commissions and insurance premium tax.  The Fiscal Division projections were based on existing revenues.  The difference in projections was $6 million in fiscal year 1992-93, $10.8 million in fiscal year 1993-94 and $6.4 million in fiscal year 1994-95.  The Budget Division's estimates were higher in each case.

 

Mr. Stevens noted the Distributive School Account and sales tax within the school fund was also taken into account because the Fiscal Division's sales tax revenue projections were higher than the Budget Division's.  As a result, the Budget Division's net projections were $5.7 million higher than the Fiscal Division's in fiscal year 1992-93, $3.2 million higher than the Fiscal Division's in fiscal year 1993-94, and $10.7 million lower than the Fiscal Division's in fiscal year 1994-95.  The overall difference was approximately $2 million.

 

Ms. Giunchigliani inquired about the $18 million difference in fiscal year 1994-95 for the Distributive School Account.  Mr. Stevens explained the $18 million was the difference in sales tax projections between the Budget Division and the Fiscal Division.

 

Mrs. Evans asked for clarification about slot route tax projections.  Mr. Stevens replied the Governor was proposing net revenues of approximately $3 million which would impact the percentage fee by $5.3 million and reduce the restricted slot amount by approximately $2 million.  The net overall increase was approximately $3.3 million.

 

Mr. Stevens distributed copies of a document entitled General Fund Revenues 1993-95 Biennium.  He explained the document reflected Fiscal Division projections only.  Original revenue estimates included actual revenue data for the first six months of fiscal year 1992-93 for the five major tax sources which represented 85 percent of General Fund revenue.  The document also showed the percentage increase or decrease in those tax sources.  Total revenue was projected to increase 4.9 percent for fiscal year 1992-93.

 

Mr. Stevens stated updated projections included two additional months of actual revenue data; however revenue projections for the five major revenue sources remained at 4.9 percent and were expected to do so for the remainder of the fiscal year.

 

Mr. Stevens indicated the Fiscal Division was not prepared to change its original revenue estimate at this time.

 

Mr. Marvel asked if increases in sales tax commissions were the result of the .5 percent increase from counties and local governments.  Mr. Stevens responded affirmatively.  Mr. Marvel asked what would happen if the .5 percent increase was not approved.  Mr. Stevens responded if the Governor's new revenue proposals were not approved, those amounts would have to be deducted from the budget or alternative revenue sources would have to be located.

 

There being no further business, the meeting was adjourned at 9:50 a.m.

 

                                                RESPECTFULLY SUBMITTED:

 

 

                                                _________________________

                                                C. Dale Gray

                                                Committee Secretary

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Assembly Committee on Ways and Means

April 6, 1993

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