MINUTES OF THE
ASSEMBLY COMMITTEE ON WAYS AND MEANS
Sixty-seventh Session
May 25, 1993
The Assembly Committee on Ways and Means was called to order by Chairman Morse Arberry, Jr., at 8:06 a.m., on Tuesday, May 25, 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. Richard Perkins
Mr. Robert E. Price
Ms. Sandra Tiffany
Mrs. Myrna T. Williams
COMMITTEE MEMBERS ABSENT:
Mr. John W. Marvel (Excused)
STAFF MEMBERS PRESENT:
Mark Stevens, Fiscal Analyst
Gary Ghiggeri, Deputy Fiscal Analyst
ACR26Directs State Welfare Board to extend time that families are eligible to receive aid under Aid to Families with Dependent Children-Unemployed Parent Program.
Assemblyman Wendell Williams, District 6, testified ACR26 had been heard in the Health and Human Services Committee. He stated he became involved in this issue in 1987 during his first session when Mr. Marvin Sedway had been advocating the project. He noted he had received a new level of insight into Welfare Reform after discussing the issue with Mr. Sedway.
Mr. Williams explained ACR26 dealt with the length of time Welfare families were eligible to receive aid under the Families with Dependent Children-Unemployed Parent (FDC-UP) program. He stated the federal government had mandated states to participate in the program and Nevada was one of six states which provided the minimum amount of support (six months) for the families. One state provided nine months of support while all other states provided the suggested federal level of 12 months support. He indicated the current system encouraged parents to separate rather than remain together because of how the benefits were administered. He emphasized if parents who found employment were able to receive the benefits for children for the maximum amount of time suggested by the federal government, it would allow the families more time to stabilize their family situation, complete the job probationary period and retain the means to provide necessary services for the children.
Mr. Williams testified the fiscal note was a combination of the federal and state contributions. Therefore, half of the fiscal impact would be the state's responsibility.
Mrs. Williams asked, since Nevada did not have AFDC (Aid to Families with Dependent Children) and only provided ADC (Aid to Dependent Children), if any thought had occurred on introducing a bill to expand the program to include families. This would keep families together rather than have the parents split up in order to receive services for their children. Mr. Williams replied the issue of program expansion had been addressed during the interim period and, to his understanding, some parts of AFDC were in place currently.
Mrs. Evans stated Mrs. Williams was correct in terms of Nevada's willingness to pass AFDC or ADC-UP, but no legislator had been able to get it through the bill process to the statutes. She emphasized it was not until the federal government mandated the programs that the state provided the services. She clarified if ACR26 was passed, the state would pick up the additional six months of service between the federal government's minimum and maximum service levels. Mr. Williams concurred and noted the option of providing nine months of service could also be considered. He commented during the interim study on this issue, the experts on Welfare Reform encouraged moving all levels of service to the maximum allowed by the federal government's mandates.
Ms. Myla Florence, Administrator of the Welfare Division, testified ACR26 would direct the Welfare Board to extend receipt of assistance under the Aid to Families with Dependent Children-Unemployed Parent Program (AFDC-UP) to the maximum period allowed by federal law. She provided the committee with some background history regarding the Unemployed Parent Program. She explained operation of the Unemployed Parent Program was optional prior to passage of the Family Support Act of 1988, at which time, 29 states were administering the optional AFDC-UP program.
Ms. Florence indicated, under the Family Support Act, all states were mandated to implement an Unemployed Parent Program effective October 1990. Those states which did not already have a program in effect as of September 26, 1988, were given the option of limiting assistance payments to a minimum of six months in a twelve-month period. Of the 23 states not already operating an AFDC-UP program, 12 states limited assistance to six months and one state was limiting assistance to nine months.
Ms. Florence remarked due to budget constraints and the unknown potential caseload for the AFDC-UP Program, Nevada opted to limit payments to six months. She noted, although payments were limited to six months in a twelve-month period, the family would continue to receive Medicaid throughout the twelve months, provided they continued to meet the requirements of the program.
She emphasized moving to twelve continuous months of cash assistance from the six-month limitation would greatly reduce the administrative burden on the Welfare Division. Currently, eligibility workers must monitor all ADC-UP cases, notify families when the cash assistance ceased and again notify them when they could receive cash payment again. She clarified, in cases containing a stepparent, some family members might be eligible for regular AFDC and might continue to receive cash assistance which entailed opening a separate case for these members during the six-month medical assistance period. When the entire family became eligible for cash assistance again, the two cases must be combined.
Ms. Florence explained the fiscal year 1992 actual ratio and average grant per recipient would be used to determine the cost of a full-time AFDC-UP program. The number of ADC-UP recipients who moved from ADC-UP cash assistance to ADC-UP-related medical assistance averaged 14 percent of the caseload each month. The average grant per recipient was $78.15 per month. She noted, based on the ACD-UP caseload projections, the Division anticipated an additional 248 ADC-UP recipients per month in FY94 and 306 per month in FY95 for an additional cost of $232,574 in FY94 and $286,967 in FY95.
Mr. John Sasser, Nevada Legal Services, spoke on behalf of ACR26. He commented he had worked with Mr. Sedway in the mid 1980s in an attempt to get Nevada to adopt ADC for the Unemployed Parent Program which was a state option at the time. He believed this was worthy legislation because it was good policy for three reasons: (1) children whether in a household with one or two parents, were just as hungry and just as needy; (2) the legislation would help keep families together; and (3) it would encourage job continuity. He remarked the cost was reasonable and could save money in the long run.
Speaker Dini asked how this legislation would fit into Welfare Reform. Mrs. Evans replied this was not part of the program presented by Welfare Reform. Ms. Florence concurred it was not part of the proposed reform package.
AB516makes appropriation to department of human resources for tutorial program at Doolittle Community Center.
Assemblyman Wendell Williams, District 6, testified AB516 was the Doolittle Tutorial Program which was started in March 1988. He stated the program began with an appropriation of $80,000 from the 1987 Legislature. He explained, at that time, the program was actually provided at three sites: the Doolittle Community Center, the Mac Kelly School and the Sunrise Acres School. The Community Center was the primary location. Through the initial appropriation, 110 kindergarten through sixth grade students participated in the program. He emphasized 95 percent of the participating students came from low-income families and 5 percent from low-to-middle income families. Seventy-five percent of the participants were identified as needing assistance in two of the three basic skills areas including math, reading and language arts. He noted a majority of the participants at the Sunrise Acres site were Hispanic and limited-English proficiency individuals.
Mr. Williams explained the staff included a program coordinator, a parent coordinator and eleven teachers. An additional grant was received which was utilized to provide clerical support. He pointed out the basic program provides students with approximately 75 minutes per day, Monday through Thursday with a nutritional snack provided at the beginning of the program.
Mr. Williams summarized the program continued to provide services even though in 1989 and 1990 there was a lack of funding and most people involved volunteered their services until additional funding was obtained. He testified the program was currently providing services at 18 sites with plans to expand to some Indian reservations. He submitted a letter from the state Bureau of Alcohol and Drug Abuse indicating the Doolittle Tutorial Program had been selected as an Exemplary Alcohol and Other Drug Prevention Program by the National Center for Substance Abuse Prevention, the National Prevention Network and the National Association of State Alcohol and Drug Abuse Directors (see EXHIBIT C). The Doolittle program would be one of eleven programs in the nation to receive such an award in Washington, D.C. in June 1993. He remarked his original argument in 1987 was $80,000 would serve hundreds of children compared to providing incarceration funding for only 2.5 inmates. Today, he testified, the program was successful as indicated by the expansion from one site to a county-wide program serving hundreds of at-risk children. It was a program the state could be proud of and a program which served children from an educational standpoint. He emphasized if the state supported the positive projects and programs for children at the beginning of their lives, it would be much cheaper and cost effective than providing services for adults after they had gone toward negative activities. He urged the committee to approve AB516.
Mrs. Evans inquired if the $150,000 requested appropriation would be for the biennium. Mr. Williams replied it would be for the biennium. He pointed out the 1989 Legislature appropriated $80,000 and the program was not funded by the 1991 Legislature. He testified the program added an Alcohol and Drug Abuse component in 1991 for preschoolers which was what the increased funding request reflected. Mrs. Evans requested the bill be amended to specify $75,000 for each year of the biennium rather than one lump sum appropriation of $150,000.
Chairman Arberry testified he and Mr. Williams had been working on this legislation and program since Mr. Sedway was Chairman of the Assembly Committee on Ways and Means. He explained Mr. Sedway had believed this program was viable because of the problems occurring in the prisons today. Chairman Arberry stressed Mr. Sedway knew then that if the state could assist children while they were young versus locking them up as adults, there would be more advantages. He emphasized this program was successful and was really working for the children and the state. Chairman Arberry complimented Mr. Williams on his worthwhile work on AB516. Mr. Williams thanked Chairman Arberry for his part in the program also.
Chairman Arberry concurred with Assemblywoman Williams and expressed his desire to have this program included within The Executive Budget because it is working and is well deserving of the support.
Mr. Price congratulated Mr. Williams on the award he and the program would receive in June and commented the program was successful for the children. Mr. Williams emphasized the award was earned due to the work of the board, teachers, and students of the program. He pointed out a six-week summer program had also been provided in conjunction with the regular school year tutorial program. The adjunct program provided remediation of skills in basic subject areas and speaking skills. This had allowed a year-round contact for children to emphasize educational development. He testified a lot of work was being done with a relatively small amount of money even in this fiscally restricted session. Mr. Williams encouraged the committee to support AB516.
Mr. Doug Dickerson, City of Las Vegas, testified, although the city did not have direct interaction with the Doolittle program, the city found it was an excellent program with a very positive impact. He stated the City of Las Vegas was in support of the legislation.
Mrs. Williams inquired if the City of Las Vegas contributed any funds for the program. Mr. Dickerson replied the city did not, but the building space was provided without any cost to the program.
Ms. Yolanda Arrington, Treasurer for the Board of Directors for the Doolittle program, testified on behalf of AB516. She stated it was very important to note the program's primary source of funding was through the state funds in the amount of $75,000. She explained additional funds for this year were received from the U.S. Department of Education which provided $46,000 plus $5,000 for Drug-Free Schools. Previously, the program had participated in some CBDG (Community Block Development Grants) HUD funds, but last
year the funds were given to another program. She commented the Doolittle program would again compete for those funds next fiscal year.
Ms. Arrington emphasized her pleasure at receiving national recognition for the program. She noted there were eighteen contracted teachers and sixteen peer tutors who served children of all colors. The program was open and available to all children who were considered at-risk. She reiterated there was significant research which supported the position that there was a direct relationship between the learning process, self esteem and at-risk children entering negative activities such as drugs, gangs or dropping out of schools. These were the types of activities the program was trying to target because no matter how good the teachers were, if the children did not come to the program with some solid values and were not prepared to do the right thing, problems would continue to occur with the children.
She explained the program would be adding services to the Paiute Indian Colony in Las Vegas and reaching out to the Boys and Girls Clubs and Hispanic youth who were also at-risk. She remarked the program was attempting to expand services to those children who needed it most and the award was recognition of those efforts. She concluded the Board was committed to do what was necessary to provide services which included continuing to seek private funding. She mentioned the board understood times were tough all over Nevada, but the correlation between those people committed to releasing prisoners which could increase unemployment, homelessness and crime and those people committed to maintaining the level of funding for children to increase self-esteem, should be considered in the funding decisions. She emphasized it was very noteworthy that many children who participated in this program in the past were peer tutors today and were going on to computer literacy and education and were now productive Nevada citizens. She recognized these children also came from homes where they were deprived, and tutorial services could be the only difference for these children's future.
Ms. Arrington explained children were targeted for the tutorial program through a survey of all Clark County teachers who were asked to identify children whom they believed were in need of skills and basic education support. After all children were identified, the parents were contacted about providing the free tutorial and drug-education services. She stated approximately 280 children were currently being served. She encouraged the committee to support AB516.
Chairman Arberry closed the hearing on AB516.
AB321Revises fees for certain court-appointed attorneys in criminal proceedings.
Mr. John Sherman, Washoe County, stated opposition to AB321 as drafted. He noted there had been discussion with the Trial Lawyers Association representative and some tentative agreement had been reached, but he indicated it was the Trial Lawyers Association's obligation to present the amendments.
Mr. Brian Doran, Court Administrator for the Sparks Municipal Court, testified the City of Sparks was also in opposition to AB321 as it was currently written. He stated the City of Sparks had been utilizing court-appointed attorneys as primary indigent defense counsel for the last year. He indicated the city switched over from the Washoe County Public Defender's office due to lack of resources. He noted because Sparks was a Municipal Court, it was the last court in the pecking order to receive a defense attorney. This caused one day a week to be scheduled for the public defender to come in. He emphasized it became a burden for all defendants who were entitled to the public defender because they had to take off work on one particular day.
Mr. Doran pointed out the City of Sparks also found a real problem with using the Public Defenders office because it was not adequately staffed for defendants who were incarcerated for minor charges and were entitled to a public defender, but could not post bail. These defendants were then forced to stay in jail until a public defender could see them. He remarked the judges found a majority of the defendants would have been released with time served of one or two days in jail, but because the public defender could not get to them, they were incarcerated for nearly a week. As a result, in May 1992, the Municipal Court petitioned the City of Sparks to allow the switch to court-appointed attorneys. The court had a list of fifteen attorneys to choose from and the attorneys' contract specified the attorney must make contact with any defendants in jail within two days of incarceration and contact with out-of-jail defendants within seven days. He acknowledged the court had found this arrangement worked well for all parties involved. He explained it also would allow defendants to appear in court on a day which was convenient to their schedule and work situation.
Mr. Doran testified the pay rate of $60 per hour was adequate for the attorneys. He noted the court's expenses were $14,000 for 56 cases utilizing court-appointed attorneys last year. He emphasized the city was not opposed to the increase, but the amount of increase included in AB321 could have a monumental effect on the court's budget and could deter the City of Sparks from allowing the court to use court-appointed attorneys. It would, therefore, require going back to using the public defender services.
Mr. Humke asked what the hourly rate of pay to the Washoe County Public Defenders office was. Mr. Doran replied from 1989 to 1992 the contract had included overhead costs in the rate and it was approximately $73 per hour. He noted the lower hourly rate was also a reason the court moved to utilizing court-appointed attorneys.
Mr. Humke asked Mr. Sherman to address the rate for capital murder cases. Mr. Sherman replied Washoe County paid the prevailing rate in the statute and there were thresholds in the law at which point the court must review the costs to assure proper billing. He indicated capital cases always exceeded those thresholds. This was one of the issues which was addressed with the Trial Lawyers Association in regard to amending AB321. He noted Washoe County understood why $60 seemed low and a rate in excess of $100 per hour would seem too high.
Mr. Sherman pointed out the total dollars spent on capital cases for court-appointed attorneys was unknown, but he could provide the information for the committee if requested.
Mr. Humke asked if, under the current statute, Washoe County judges were generally certifying the claims in excess of the threshold amount and ordering the county to pay. Mr. Sherman indicated they were and pointed out, about a month or two ago, the Supreme Court made changes in the guidelines for attorney fees and the district courts generally followed more detailed guidelines than those which Supreme Court had placed upon them.
Mr. Price asked Mr. Sherman if he was broke and facing the death penalty, would he believe $100 an hour was excessive. Mr. Sherman replied no.
Mr. Bob Hadfield, Nevada Association of Counties (NACO), stated NACO had been in discussions with the Nevada Trial Lawyers Association and was unalterably opposed to the changes which were presently included in AB321. He commented NACO would work with the Nevada Trials Lawyers Association to amend the bill in a way all interested parties could agree with. He noted, currently, the legislation would be a budget buster.
Mr. Humke inquired for clarification on the cost differentiation for the counties versus the state. Mr. Sherman replied no actual fiscal impact for Washoe County had been discussed on the percentage of hourly fee. He commented discussions with the Trial Lawyers Association centered on raising the hourly rate to attract more experienced attorneys who would take less time and therefore cost less in the long run. This would result in some inherent savings element, but it was a gray area and could not necessarily be quantified in black and white. If the costs were calculated on a straight percentage increase without considering the mitigating circumstances, the fiscal impact would be significant.
Mr. Doran remarked the hourly time spent on cases in the limited jurisdiction courts or the municipal courts was about three hours per case. He noted the judges were looking more closely at the individual defendants to determine whether or not they were truly indigent. He stated out of the 56 cases over the past fiscal year, only four had met the indigent-person criteria. The remainder have had to pay some portion or all of the public defender or court appointed attorney fees back. Mr. Sherman remarked the Washoe County Public Defender did defend indigent capital cases. He noted all conflict cases and capital cases were given to court-appointed attorneys rather than to the public defenders office.
Chairman Arberry closed the hearing on AB321.
LABOR RELATIONS -- PAGE 390
Mr. Frank MacDonald, Labor Commissioner, identified himself. Chairman Arberry asked Mr. MacDonald to discuss the division's work load. Mr. MacDonald stated the work load referred to him in correspondence with staff was in regard to the 1991-92 biennium report. He indicated he had listed 1,264 days in arrears according to the information the division had available. He remarked updated information indicated, for the 1992-93 biennium, the division was now only 423 days in arrears.
Ms. Giunchigliani asked how the 423 days in arrears correlated with the same amount of time in the last biennium. Mr. MacDonald replied, with 10 months into the fiscal year, the division was averaging 106 days per investigator versus 316 days for the last year. Ms. Giunchigliani asked the reason for the agency was performing better this fiscal year. Mr. MacDonald stated the division had a new auditor who was working out very well. Ms. Giunchigliani inquired if the division needed a revised budget to accommodate additional staff to get the caseload down. Mr. MacDonald replied no, a revised budget was not needed, but they just prayed no additional budget cuts would occur.
Ms. Giunchigliani commented because of staffing limitations, the Commissioner's office was only monitoring large business and asked when medium and small businesses would be added for monitoring. Mr. MacDonald stated that was correct and at least two more investigators, one each for north and south regions, would be needed in order to add monitoring of medium and small businesses. Ms. Giunchigliani asked how many businesses were not being
monitored. Mr. MacDonald replied he had no way of knowing because the Commissioner's office had not been able to monitor it for a long time.
Mr. Price pointed out the Labor Commissioner's salary, as an administrator of a division or department, was one of the lowest salaries, if not THE lowest in the state. He asked Mr. MacDonald why. Mr. MacDonald replied he did not know why other than the division being the low man on the totem pole. He explained in 1983 when the salary started at $31,000, it was one of the lowest and has continued at the same lower level. Mr. Price cited a number of salaries: Labor Commissioner, $47,284; Department of Taxation, $72,000; Director of Motor Vehicles, $72,000; Director of Commission on Economic Development, $66,000; Film Commissioner, $54,000; and the Equal Rights Commissioner $53,000. He stressed the Labor Commissioner's salary appeared to be way out of whack and it was too low for a director's salary.
BUDGET CLOSINGS
BENEFITS SERVICES FUND -- PAGE 192
Mr. Mark Stevens, Fiscal Analyst, stated there were not many fiscal adjustments. At the bottom of page 192, the second category under expenditures staff recommended elimination of the transfer to Rehabilitation $14.9 million for FY94 and $19.5 million for FY95. These funds related to the Governor's Recommendation to have the Rehabilitation Division do the rehabilitation services for SIIS clients. This was modified in the money committees' closing. He explained there was $1 million provided between SIIS and rehabilitation for contracting of vocational rehabilitation services for SIIS clients. Therefore, staff recommended the amount be removed from this budget account. He noted the $1 million would be a direct payment from SIIS to Rehabilitation.
Mr. Stevens stated discussions with SIIS indicated the $1 million would transfer directly without flow-through to the Benefits Services budget account. Mr. Thorne remarked the funds could flow through directly if the divisions were operating on the same basis as they have been in the rural areas, but he was not sure specifically.
Mr. Stevens emphasized staff was operating under the assumption the funds would not flow through the budget account and indicated staff would verify the information. If necessary, the account could be amended for $1 million later.
Ms. Tiffany asked if data processing had included costs for Vocational Rehabilitation. Mr. Gary Ghiggeri, Deputy Fiscal Analyst, clarified the funds which would be used for data processing were included in the vocational rehabilitation budget and would be a reduction to the SIIS budget of approximately $250,000. Mr. Stevens stated the data processing recommendation would not impact this budget account. He stressed this account was basically the group insurance committee on benefits budget account which accounts for all the funding related to the group insurance program.
Mr. Stevens pointed out, based on Data Processing subcommittee closings, there was a computer programmer consolidated into Information Technology Service which would need to be retained in this account in order to be consistent with other closings. He noted the passage of AB359 set up a deferred compensation committee and $13,000 would be taken out of this account and moved to the new deferred compensation committee.
Mr. Stevens elaborated there were no other non-monetary changes. SB389 in Senate Finance would provide for the monthly contributions of employee insurance benefits recommended to stay constant in FY94 at $213.75, but would increase to $326.50 for FY95. He pointed out previous action to dependent coverage increased $76 per month last January from $130 for spouse and children to $206. Staff had written to the Department of Administration for estimates of what employee/spouse coverage would be for each month in each year of the biennium based on recommendations in The Executive Budget. The response was $369 per month effective January 1994 and $430 per month effective January 1995.
Mr. Stevens commented other pending legislation which would impact this account in some way was AB206 which would require the Legislative Auditor to conduct a performance audit of the State Self-Insurance Program. This legislation had a $7,500 fiscal note attached. An adjustment which might need to be made later would be related to the prison medical administration costs within this account. These costs were inmate driven and based on the closure of the prison budgets, it might be necessary to come back and adjust this budget account.
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MR. HELLER MOVED TO CLOSE THE BENEFITS SERVICES FUND BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF.
MR. SPITLER SECONDED THE MOTION.
THE MOTION CARRIED BY VOICE VOTE. MR. DINI, MR. MARVEL AND MS. GIUNCHIGLIANI WERE ABSENT FOR THE VOTE.
BUDGET CLOSED.
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STATE EMPLOYEES' WORKERS' COMPENSATION -- PAGE 197
Mr. Stevens explained The Executive Budget recommended an average rate assessment of $4.27 per $100 of gross salary in FY94 and $4.65 per $100 for FY95 up to $36,000 of each employee's salary. He noted AB342, which had been passed by the Legislature and signed by the Governor, revised the maximum salaries for the purposes of calculating industrial insurance premiums paid by employers and basically raised the ceiling over time. He explained, in calendar year 1993, the maximum the SIIS rate would apply to would be $27,000, in 1994 it would be $30,000, in 1995 it would be $33,000 and in 1996 it would be $36,000. Mr. Stevens emphasized what would occur, based on how the current budget was constructed, was more money would be generated than would be necessary because the rate would be based on $36,000, not the staggered rate which was currently included in the statutes. SB316 in its current form would require a $250 per claim deductible which had not been budgeted anywhere. Some of the excess money could possibly be utilized for that purpose or the average assessment rate could be lowered. He noted if this occurred, when the Budget Division recalculated all the budgets so fiscal staff could draft the Appropriations Act, every budget would come out of balance.
Mr. Stevens summarized there would be three options: (1) to go with the Governor's Recommendation and have extra unnecessary funds which could be utilized for the higher per-claim deductible; (2) to lower the budget rate and have the Budget Division rebalance all pertinent accounts; or (3) leave the rate as is and have the Budget Division modify the rate each year as necessary.
Mr. Thorne explained the average rate assessed per $100 of payroll was one which was backed into once the Budget Division determined what the gross premiums would be. The way the funds would be collected, as proposed in The Executive Budget, would generate enough to cover the estimated premium to SIIS. He stated he did not believe there would be excess funds in the budget and concurred with Mr. Stevens, if the amount of payroll assessed was reduced in accordance with the passed legislation, the rate per $100 of payroll would have to increase in order to compensate and generate the cost of the estimated premium.
Chairman Arberry asked what the Budget Division's recommendation would be regarding this account. Mr. Thorne indicated it would be difficult to go back and adjust the payroll and pertinent accounts. Chairman Arberry asked if the account would cover the $250 deductible. Mr. Thorne replied no, it was not the Budget Division's intent to pay the deductible cost out of this account. He noted discussions had indicated the deductible cost would be carried in each agency's budget account, such as deductibles for car insurance and property insurance currently do.
Mrs. Evans inquired if there would be anything in SB316 which would impact this budget account. She asked if the committee should wait to close the account pending the outcome of SB316. Mr. Thorne replied there would be some relationships and it would come down to the estimated impact on the premiums for the coming biennium. He noted the premium estimates were probably not too far off.
Chairman Arberry asked if the committee closed this account based on the Governor's Recommendation would there be a problem. Mr. Thorne stated he did not believe so. He stated if the budget was closed as recommended, the premiums would be assessed based on the $36,000 cap instead of the new cap. If the Budget Division adjusted accounts to the lower cap, then the Budget Division would have to increase the rate per $100 in order to offset the cost.
Mr. Stevens pointed out the bottom line would be the account needed to be closed based on what would work most efficiently for the Budget Division. Mr. Thorne requested the account be held to provide the Budget Division time to review the options discussed and return to the committee with clarification. Chairman Arberry stated the budget would be held for one day for Mr. Thorne to provide the information.
INSURANCE LOSS PREVENTION -- PAGE 291
Mr. Stevens stated there were no adjustments to the account.
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MR. SPITLER MOVED TO CLOSE THE INSURANCE LOSS PREVENTION BUDGET ACCOUNT AS RECOMMENDED BY THE GOVERNOR.
MRS. EVANS SECONDED THE MOTION.
THE MOTION CARRIED BY VOICE VOTE. MR. DINI, MR. MARVEL AND MS. GIUNCHIGLIANI WERE ABSENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
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LABOR RELATIONS BOARD -- PAGE 390
Mr. Stevens indicated the overall reduction would be $25,000 for FY94 and approximately $6,000 for FY95 as a result of removing all EMRB-related costs. The advisory board was included for apprenticeship programs but no salary was included and if the committee chose to include salaries for the board the cost would be about $1,920 per year.
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MR. SPITLER MOVED TO CLOSE THE LABOR RELATIONS BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF.
MR. HUMKE SECONDED THE MOTION.
Mrs. Evans asked if the apprenticeship program would be the State Apprenticeship Council. Mr. Stevens replied it was. Mrs. Evans clarified the salaries for the Board members had been deleted. Mr. Stevens stated the salaries had not been included in The Executive Budget and funding would need to be found through salary or vacancy savings. Mrs. Evans asked if this was how salaries were paid each biennium. Mr. Stevens indicated usually The Executive Budget had a separate line item. The $1,920 cost would be included in the $25,000 reduction and moved to EMRB. Mrs. Evans stressed the board provided important activities and she would oppose the exclusion of salary costs.
MRS. EVANS AMENDED THE MOTION TO INCLUDE THE $1,920 FOR STATE APPRENTICESHIP COUNCIL SALARIES.
MR. SPITLER AND MR. HUMKE AGREED TO THE AMENDMENT.
THE MOTION CARRIED BY VOICE VOTE. MR. DINI, MR. MARVEL AND MS. GIUNCHIGLIANI WERE ABSENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
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SMALL BUSINESS -- PAGE 508
Mr. Stevens explained the budget was revised on March 9, 1993 because the funding source was inadvertently left out of The Executive Budget. He noted the agency was recommended to move to the proposed Department of Business and Industry. Testimony before the committee indicated the agency should stay in Economic Development. He noted a letter from Economic Development supported the retention of the agency in Economic Development to prevent a potential problem with matching funds if the agency was moved to Business and Industry.
Chairman Arberry held the budget account.
MOTION PICTURES -- PAGE 593
Mr. Stevens stated the committee requested Mr. Bob Hirsch submit information on how funds would be utilized if additional monies could be found and added to the budget. Mr. Hirsch had responded with the following priorities: one additional position in Southern Nevada; upgrading the half-time Northern Nevada clerical position to full-time; and provide $60,000 in each year of the biennium for contract services for location scouting. Mr. Stevens elaborated the cost of the first two priorities would be approximately $50,000 for FY94 and $62,000 for FY95 funded 75 percent with room tax dollars and 25 percent general fund. He noted the $60,000 for contract location scouting could be generated from the sale of advertising in annual production services directories or through service fees for obtaining various and necessary permits. He stated the agency had testified there would be no negative industry reaction to either item.
Chairman Arberry asked for the committee's input regarding the agency's requests. Mr. Price believed the film commission had always been a funds generator and encouraged the committee to support the contracting and the position adjustments.
Mr. Humke concurred. He advocated the use of Tourism dollars to fund the positions and believed it would be a good use of money to generate more funds for the state.
Ms. Tiffany requested clarification on where the salary funds would be generated. Mr. Stevens stated 75 percent would be from room tax monies transferred from Tourism and 25 percent would be general fund. Ms. Tiffany indicated it would be an appropriate use of funds.
Mrs. Evans agreed with most of the discussion, but pointed out there was legislation on the possibility of capping the transfer of funds from Tourism at 15 percent of the total budget. She remarked testimony had been provided by the agency that over $77 million was generated by the agency's efforts. She asked how the amount was verified by the agency and how was the accuracy of the funds demonstrated. She inquired when the agency last had an audit. Chairman Arberry stated he believed an audit was currently being done. Speaker Dini indicated, to his knowledge, there has never been an audit, but there could be one being done currently. Mr. Stevens commented the audit would not verify how much money was generated in the state. It would be more of an internal, operations audit, unless a performance audit was authorized.
Mrs. Evans remarked she would be interested in an audit and also in verifying the accuracy of the claim reported of generating $77 million in statewide revenues. Mr. Price clarified the numbers generated were probably higher than reported. He stated when commercial or movie companies came into the state, the monies declared were based on the companies' budget while they were in the state. The revenues would include room rent, meals, equipment and animal rental, etc. He emphasized verifying the costs and revenues reported would be difficult because it would not be feasible to audit each commercial or movie company's expenses because they were private companies and often did not want the exact funds known publicly.
Speaker Dini indicated the amount reported was probably quite accurate. He cited a Miller beer commercial which took place in Yerington and employed at least 150 paid people, redesigned the outdoor theater which was rented for a week. The company stayed in Carson City and Reno and brought in meals from Reno.
Mrs. Williams suggested the reported amount was based on the multiplier factor. She stated the 150 people hired in Yerington might have been for the direct commercial, but with most movies made in Las Vegas, any extras hired were at the minimum wage and then they would make a deal with a charity where the individuals would not get paid and the funds would go to the charity. This was "cheap labor." She stressed she did not have a problem with giving the funds to the non-profit charities, but she did have a problem with the companies paying only the minimum wage.
Ms. Giunchigliani remarked there was a bill in the Assembly Committee on Labor and Management which addressed this division acting as a hiring hall in northern Nevada and locking out some small businesses in southern Nevada from providing key grips, accounting, and such positions. She stated she directed Mr. Hirsch to work with the groups in southern Nevada to propose amendments to address the committee's concerns. She agreed with Mrs. Williams'
concerns regarding a state division acting as a hiring hall rather than being provided with a list of qualified individuals from which to select workers.
Chairman Arberry held the budget.
COMMISSION ON ECONOMIC DEVELOPMENT -- PAGE 588
Mr. Stevens remarked one full-time position was funded for only half-time. In order to return the position to full time it would cost approximately $32,000 per year of the biennium. The Commission on Economic Development provided a letter to the Fiscal Division indicating they would recommend reducing some of their costs in order to fund the other half of the position. The division's recommended reductions in each year of the biennium would be: out-of-state travel, $10,000; in-state travel, $5,000; operating costs, $4,000; and advertising approximately $13,000. He summarized their would be no impact on the general fund for the technical change.
Mr. Stevens noted the Lt. Governor has requested the committee authorize a letter of intent to allow the Commission on Economic Development to approach the IFC regarding quick-start funds if necessary during the biennium. He stated during the committee hearing there had been discussions about the need for additional personnel to provide services to out-of-state firms which would be investigating whether to locate in Nevada. He requested guidance from the committee on this issue.
Mr. Stevens noted the Office of Science and Technology has been removed from the Department of Museums, Library and Arts. He remarked if the budget was placed in the Department, it should be organized with a separate budget account in order to have the budget authority established if approval was provided.
Vice Chairman Spitler remarked the agency had recommended taking $13,000 per year of the biennium from advertising to move the half-time person to full-time. Mr. Stevens stated this was correct. Mr. Spitler pointed out testimony had been provided which said the agency was $50,000 down in advertising without the $13,000 additional reduction. Mr. Stevens indicated the position was for a Senior Marketing Associate and it was included as part time rather than full time by an oversight. He explained to retain the position as full-time without any general fund impact, the agency indicated they would be willing to take $32,000 in other area cuts to fund the position. He stressed this would not be an additional position.
Speaker Dini suggested adding the necessary researcher position costs which the agency had requested. Mr. Stevens replied the additional researcher position would require $30,000 in each year of the biennium or, if the position began in October, $23,000 for FY94 and $31,000 for FY95. He noted fringe and equipment costs would also need to be added at a total cost of $32,000 for FY94 and $38,000 for FY95.
* * * * *
MR. DINI MOVED TO CLOSE THE COMMISSION ON ECONOMIC DEVELOPMENT BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF INCLUDING THE ADDITIONAL RESEARCHER POSITION.
MRS. EVANS SECONDED THE MOTION.
Ms. Tiffany commented the additional personnel to relocate the firms from out of state did not include the researcher position. She indicated she did not support the additional position. She testified she would like to see the Office of Science and Technology included within the Commission on Economic Development because the state needed to deal with technology transfer, high-tech and federal jobs on the test site. She emphasized the need to have these types of jobs before the state thought about education. She also requested addressing a new Data Processing Board in order to bring some high-tech and technology transfer to Nevada.
Chairman Arberry remarked, at this point, the staff recommendation was not to address the Office of Science and Technology directly, but establish the budget account format.
Mrs. Evans remarked on a related matter, AB208 had been heard and had to do with the new Rural Nevada Development Corporation (RNDC). She explained RNDC had some assistance presently from a federal grant which was slated to end. RNDC requested $40,000 per year of the biennium and the amount was revised to $30,000 per year. She emphasized RNDC would not have any staff. She asked if Speaker Dini believed this would need to be considered when addressing their budget account. She wondered if AB208 would be a stand alone or how would it be addressed.
Mr. Speaker indicated RNDC was not included in the budget and asked the Budget Division if it could be added into the budget or would the bill be necessary to fund the RNDC functions. Mr. Stevens stated AB208 could be handled either by processing the bill or including it in The Executive Budget. He said Fiscal staff had a letter revising the amount the agency believed they would need to fund RNDC functions.
Mr. Price stated he would support the position, but in response to Ms. Tiffany's observation, the Legislature previously appropriated funds for Nevada Development Authority (NDA) which were now funded within the Economic Development Commission through grants.
Mrs. Williams clarified the additional personnel for the Commission on Economic Development would be for a researcher. Mr. Stevens replied that was correct. Mrs. Williams asked Mr. Stevens to clarify the position Mrs. Evans was addressing. Mr. Stevens indicated the position was not a new position, but a position included in RNDC which would be funded through transfer funds flowed through EDAN (Economic Development Authority of Eastern Nevada).
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL WAS NOT PRESENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
* * * * *
SPEAKER DINI MOVED THE FUNDS ALLOCATED BY AB208 BE INCLUDED IN THE EXECUTIVE BUDGET.
MRS. EVANS SECONDED THE MOTION.
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL WAS NOT PRESENT AT THE TIME OF THE VOTE.
* * * * *
VICTIMS OF DOMESTIC VIOLENCE -- PAGE 950
Mr. Stevens explained The Executive Budget recommended the administration of this agency be moved from MHMR to the Child and Family Services Division. Effective July 1, 1994, the amount of money for each marriage license which was transferred to this account was increased from $10 to $12. Therefore, staff would recommend an adjustment to the budget in revenue with a corresponding increase to the Aid to Individuals line item. Revenue would increase $9,862 in FY94 and $273,458 in FY95. He clarified the large amount in the second year of the biennium was due to the amount of each marriage license being increased.
* * * * *
MR. SPITLER MOVED TO CLOSE THE VICTIMS OF DOMESTIC VIOLENCE BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF.
MRS. EVANS SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE.
BUDGET CLOSED.
* * * * *
Mrs. Williams stated for the record she did not approve of moving the agency from MHMR to Child and Family Services.
ADJUTANT GENERAL CONSTRUCTION FUND -- PAGE 1452
* * * * *
SPEAKER DINI MOVED TO CLOSE THE ADJUTANT GENERAL CONSTRUCTION FUND BUDGET ACCOUNT AS RECOMMENDED BY THE GOVERNOR.
MR. SPITLER SECONDED THE MOTION.
Mr. Price commented there was a project to build on some Nellis property and asked if any of the funds for the project would come from this account. Mr. Ghiggeri clarified what Mr. Price was referring to was the improvements at the Nellis site and funding was provided in the 1991 session to extend the utilities to the site. He stated approximately $1.9 million of unspent funding had not been obligated in the Governor's Capital Improvement Program budget for the 1993-95 biennium which would be one of the issues to be addressed in the CIP Subcommittee. He explained the funding for the actual Armory construction was not displaced in this budget account but would flow through the Public Works Board under Capital Improvements Projects once the funding was actually received.
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL AND MS. GIUNCHIGLIANI WERE NOT PRESENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
* * * * *
VETERANS AFFAIRS -- PAGE 1455
Mr. Stevens indicated there were two items to be discussed. He explained the board salaries for the advisory committee had been included in The Executive Budget, but only $560 per year was allocated for board travel. He stated this would be an insufficient amount for the board to travel two times per year and staff would recommend another $500 per year if the committee chose to fully fund the travel. He pointed out in-state travel had been completely eliminated in the budget account which was not realistic. He suggested $3,000 per year minimum be included for the agency.
* * * * *
MR. SPITLER MOVED TO CLOSE THE VETERANS AFFAIRS BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF.
SPEAKER DINI SECONDED THE MOTION.
Mr. Dini indicated, as a member of the Fernley Cemetery Advisory Committee, the Senate had recommended two positions, one each for Boulder City and Fernley. He explained these positions were recommended because if the Honor Camps close, the Cemetery would need some help. He noted the cemetery only had one person and would need to have someone to assist. He emphasized one person alone digging graves with machinery was quite dangerous. The Silver Springs Women's Honor Camp was currently providing at least two to three days per week work at the Fernley Cemetery. Up to this point the Honor Camps had allowed these functions statewide to just get by, but if those were cut there would be no one to help. He suggested discussing the addition of the two positions.
Mr. Stevens stated the Senate action added two positions, one in Fernley and one for Boulder City, at the cost of $26,000 for each position in FY94 and $28,000 for each position in FY95. He stated Senate offset the cost by reducing Honor Camp payments by $15,000 in each year of the biennium for each cemetery. Mr. Dini asked if burial fees had been raised. Mr. Stevens replied he did not believe they had been.
Mr. Spitler asked if the Senate had stated the positions would not be approved if the Honor Camps were not closed. Mr. Stevens indicated the Senate had only reduced the Honor Camps payments.
MR. SPITLER AMENDED HIS MOTION TO INCLUDE THE TWO POSITIONS FOR BOULDER CITY AND FERNLEY. MR. DINI AGREED TO THE AMENDMENT.
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL WAS NOT PRESENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
* * * * *
EMERGENCY MANAGEMENT -- PAGE 1461
Mr. Stevens stated the issue to be discussed would be how to deal with the SERC. He explained the Governors Recommendation was to include the SERC funds within this budget account and to allow the positions within the Division of Emergency Management to provide the administrative support. Mr. Stevens indicated Mr. Hawke had reviewed the issue and the main consideration was how to deal with SERC.
* * * * *
MR. DINI MOVED TO HAVE SERC REMAIN AS A STAND ALONE DIVISION.
MS. TIFFANY SECONDED THE MOTION.
Mrs. Williams noted Mr. Hawke had distributed a chart which indicated merging would not have a negative affect on SERC and granted monies would remain the same. She added she was a member of the local SERC group in Clark County. Mr. Dini stated Emergency Management had not had a good track record on paying off the counties for grants. He pointed out the agency was behind about $186,000 to Clark County and $30,000 to Lyon County. He emphasized the reason local SERCs wanted to see it remain stand alone was because the counties were concerned their grants would be utilized for supporting emergency management rather than for local needs.
THE MOTION CARRIED BY VOICE VOTE. MRS. WILLIAMS ABSTAINED FROM THE VOTE. MRS. EVANS AND MR. MARVEL WERE NOT PRESENT AT THE TIME OF THE VOTE.
* * * * *
EMERGENCY MANAGEMENT ASSISTANCE -- page 1468
* * * * *
MR. SPITLER MOVED TO CLOSE THE EMERGENCY MANAGEMENT ASSISTANCE BUDGET ACCOUNT AS RECOMMENDED BY THE GOVERNOR.
MS. TIFFANY SECONDED THE MOTION.
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL AND MRS. EVANS WERE NOT PRESENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
* * * * *
EMERGENCY MANAGEMENT -- FEDERAL GRANTS -- PAGE 1470
Mr. Stevens stated there would be a change based on the motion to have SERC stand alone. He noted staff would recommend the one new Disaster Response Planner position be continued in this account and the match for the position be provided by SERC funds.
* * * * *
MR. PERKINS MOVED TO CLOSE THE EMERGENCY MANAGEMENT - FEDERAL GRANTS BUDGET ACCOUNT AS RECOMMENDED BY THE STAFF.
MR. DINI SECONDED THE MOTION.
THE MOTION CARRIED BY VOICE VOTE. MR. MARVEL AND MRS. EVANS WERE NOT PRESENT AT THE TIME OF THE VOTE.
BUDGET CLOSED.
* * * * *
Mr. Thorne indicated through the actions taken by the Ways and Means Committee today and by Senate Finance as related to SERC, the amount of funds spent would be nearly as much as was proposed in The Executive Budget by Governors Recommendation.
Chairman Arberry adjourned the hearing at 10:50 a.m.
RESPECTFULLY SUBMITTED:
_________________________
Kerin E. Putnam
Committee Secretary
??
Assembly Committee on Ways and Means
May 25, 1993
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