MINUTES OF THE
SENATE COMMITTEE ON COMMERCE AND LABOR
Sixty-seventh Session
June 7, 1993
The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 9:30 a.m., on Monday, June 7, 1993, in Room 227 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda. Exhibit B is the Attendance Roster.
COMMITTEE MEMBERS PRESENT:
Senator Randolph J. Townsend, Chairman
Senator Sue Lowden, Vice Chairman
Senator Ann O'Connell
Senator Mike McGinness
Senator Raymond C. Shaffer
Senator Leonard V. Nevin
Senator Lori L. Brown
GUEST LEGISLATORS PRESENT:
Senator Dina Titus, Senatorial District 7
STAFF MEMBERS PRESENT:
Beverly Willis, Committee Secretary
Brian Davie, Senior Research Analyst
OTHERS PRESENT:
Lorne Malkiewich, Legislative Counsel, Legislative Counsel Bureau
Colette L. Rausch, Deputy Attorney General
John Kuminecz, Commissioner, Consumer Affairs
David Klem, President, Nevada International Trade Exchange
Max Montgomery, President, Cherokee Engineering, Inc.
Frankie Sue Del Papa, Attorney General, State of Nevada
Steve Sisolak, American Distributing
Senator Townsend opened the hearing on Senate Bill (S.B.) 499.
SENATE BILL 499: Makes various changes relating to trade regulations and practices.
Lorne Malkiewich, Legislative Counsel, Legislative Counsel Bureau, testified noting several reasons for S.B. 499. There was a discussion between Senator O'Connell, Senator Brown and Mr. Malkiewich regarding some wording.
Next to testify was Colette L. Rausch, Deputy Attorney General, who gave a more detailed explanation. She stated there had been many provisions adopted without remedies so remedies were added and inconsistencies corrected. There was further discussion between Senator O'Connell, Senator Townsend and Ms. Rausch regarding several points that needed clarification. Ms. Rausch noted there were no dedicated funds for public service information at this time.
Senator Nevin inquired about monies from another source to use for consumer education, perhaps in the form of written material or public service announcements regarding deceptive practices. Senator Townsend wanted to know if consumer education was taking place in high schools. Ms. Rausch stated as often as possible, attempts are made to contact schools.
John Kuminecz, Commissioner, Consumer Affairs, noted Consumer Affairs does put out public service announcements as well as speaking engagements to schools and business organizations. Mr. Kuminecz said he did support S.B. 499 since it would give his department the ability to mediate settlements.
SENATOR BROWN MOVED TO DO PASS S.B. 499.
SENATOR NEVIN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
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Senator townsend then opened the hearing on Assembly Joint Resolution (A.J.R.) 20.
ASSEMBLY JOINT
RESOLUTION 20: Urges Congress to enact legislation to facilitate establishment of Western United States Trade District.
First to testify was David Klem, President, Nevada International Trade Exchange. Mr. Klem noted his organization is a Nevada nonprofit corporation. He stated A.J.R. 20 is an identical resolution passed by both houses of the Nevada Legislature 10 years ago this month. Mr. Klem said the reason for introduction of the resolution as it was 10 years ago, was to be sure it is still in the best interests of Nevada. Mr. Klem distributed Exhibit C,
information on a project description of the trade district concept. (The original will be found in the research library)
Mr. Klem went on to give an explanation of the concept behind the Trade District.
Senator Nevin questioned a reference to nuclear power. Max Montgomery, President, Cherokee Engineering, Inc., gave an explanation. Mr. Klem, Senator Townsend, Senator Brown and Mr. Montgomery discussed the energy problems.
Senator Brown, Senator McGinness, Senator Lowden and Mr. Klem discussed physical location and power sources of the trade district.
Senator Townsend closed the hearing on A.J.R. 20 and opened the hearing on S.B. 484.
SENATE BILL 484: Provides additional civil penalty for violations of certain unlawful trade practices which are directed toward elderly or disabled persons.
Senator Dina Titus, Senatorial District 7, was next to testify.
Senator Townsend asked Senator Titus, for the record:
You and Senator Raggio had like bills. Were they identical or same concept?
Senator Titus replied:
Same concept. Senator Raggio had it before the judiciary committee at the very beginning of the session and it turned out to have a lot of things that needed work on. So when I introduced my bill, he saw it and saw it was similar to what he was trying to accomplish, so he withdrew his bill and signed on as my cosponsor.
Senator Townsend expressed concerns over the necessity for S.B. 484 and asked for clarification. Senator Titus stated it contains enhanced penalties for consumer fraud committed against the elderly or the disabled.
Senator Titus then introduced Frankie Sue Del Papa, Attorney General, State of Nevada, who presented Exhibit D. Ms. Del Papa proceeded to explain this exhibit. Ms. Del Papa stated consumer education is extremely important in order to combat fraud among the elderly.
Senator Lowden voiced a concern over what she feels to be extremely broad language. Ms. Del Papa and Ms. Rausch explained where the language had originated. Ms. Rausch noted this language contains factors the court would consider.
There was discussion by Senator O'Connell and Ms. Del Papa regarding ways of getting public service announcements to the elderly.
Steve Sisolak, American Distributing, was next to testify. Mr. Sisolak stated he has a problem with the bill regarding the word "elderly." He does not care for the connotation. Mr. Sisolak went on to present Exhibit E and Exhibit F, advertisements for marketing lists.
Mr. Sisolak noted for the record:
An unscrupulous marketer, whether he's a telemarketer or a direct marketer can easily target a senior citizen or an elderly person. You can target someone that's disabled. You can target someone that's infirm; you can target anybody you want. List companies and I've got several catalogs here, and these are not fly-by-night outfits, these are major list companies that provide lists to every marketer in the United States. You can get a list of absolutely anything. Any magazine subscriptions, any credit card holder, any type of information that's available. And they've become so refined in targeting the market that there's 10 or 15 categories. You can go by zip code, you can ask for all the people that are widowed over the age of 65 living in a particular zip code with a credit card limit of over $5,000 that have given to charities in the past. It goes on and on and on, it can be that specific.
Somebody that wants to use the list for unscrupulous methods certainly can do that. The two handouts I gave, the first company is called Americalist, a large list company. The two highlighted parts are the client targets. That's exactly what myself as a client is. I get in touch with a list broker and I give him the exact specifics in terms of reaching a prospect. Those might include such things as are listed; postal area, single family, whether you own your home, the income range, the age of the individual, etc. It goes on to say Americalist will target the market as closely as possible. The second handout is from American List Counsel, which is a different company and I've attached two pages to it. The first one is the profile for The American Lung Association. Charities sell their lists as well as magazine companies. And unfortunately what happens is someone out of the goodness of their heart donates to the American Lung Association, doesn't often realize their name is being sold to anybody who's willing to pay the money to buy it. And if you look at the right hand side of the page, there are approximately 15 categories that they break down the selection process into where I can buy the list depending on how much the people donated. If I want to buy the $25 donators it's more than the $10 donators. It's that specific in terms of exactly who you can target, if you so desire to target a particular individual. And on the left you can see we can target people between 25 - 34, or up to 65 and over. The income and the various ranges that are used; the type of dwelling they have. The second page deals with the exact same thing regarding ages, incomes, etc. There 's another you can buy from the John Wayne Cancer Insurance. People who have subscribed to cancer insurance; companies have found another source of revenue and it's not necessarily unscrupulous companies all the time, but they're used for unscrupulous purposes. Unfortunately, if you buy a list of someone that's donated to the Lung Association, or has cancer insurance and come up with some song and dance about you represent this charity and they're going to do good, people want to believe, especially people from the senior area. They want to believe the fact that you're really trying to raise money to cure cancer. When in effect, all they're trying to do is enrich themselves, they're really not attempting to put much money toward the problem. Again, it's not just telemarketing, I acknowledge the fact that unscrupulous telemarketers do use this list, just like direct mail companies and other people do. Unfortunately it's become so refined, you can buy a list of anything you want in these various catalogs. You can ask for lists on anything and it's certainly available.
The second point I want to make deals with education. What has to happen is we have to stop this problem before it starts. In my opinion, it's all well and good to have penalties, after the fact, but we'd prefer that people are not victimized before we have to have enhanced penalties. I'm sure you have all received cards saying "You've won," the National Consumers League Alliance Against Telemarketing Fraud have put out a post card telling you are not a winner, you are definitely not a winner and it explains on the back why you are not a winner. The United States Postal Service puts out a brochure that says "Don't take the bait." It talks about a boiler room fraud versus direct marketing; what do the sales people say. I've given these to my folks and they share with friends at senior functions and they really read this information. Some have admitted to being victimized. If the information is put into their hands it would help. They really read this information.
Senator Townsend asked Ms. Del Papa what could be done to get educational information to the senior population.
Ms. Del Papa noted a suggestion to send this type of information out with mailings already being sent is a very good suggestion. She noted there is sharing of information between other states. Ms. Del Papa went on to name various ways education is being handled.
Senator Titus said perhaps educational brochures could be sent out with political campaign information to potential voters.
Senator Nevin noted other legislation that would be applicable in order to take care of educational information, both for those in-state and those out-of-state.
Mr. Sisolak reiterated his view again that educational information warning against mail fraud is extremely important. Senator Townsend concurred and offered other suggestions. Senator Nevin is given the task of meeting with a subcommittee on this situation.
Senator Townsend closed the hearing on S.B. 484.
Senator Townsend then noted that Senator Brown wanted to indefinitely postpone S.B. 258 since there was still work to be done.
SENATE BILL 258: Requires each firearm sold in this state to be sold with device that is designed to prevent young children from discharging firearm.
SENATOR BROWN MOVED TO INDEFINITELY POSTPONE S.B. 258.
SENATOR NEVIN SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
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Senator Townsend then opened discussion on S.B. 445.
SENATE BILL 445: Requires policies of insurance for motor vehicle liability to provide procedure for arbitration to resolve disputes concerning independent evaluations of medical or chiropractic care.
SENATOR BROWN MOVED TO INDEFINITELY POSTPONE S.B. 445:
SENATOR NEVIN SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
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Senator Townsend noted that the meeting for June 8 would be moved from 9:30 a.m. to 9:00 a.m.
The next item to be addressed was Bill Draft Request (BDR) 58-2092:
BILL DRAFT REQUEST 58-2092: Requires Public Service Commission of Nevada to act within a certain time on proposed amendment to certain plan to public utilities.
SENATOR NEVIN MOVED FOR COMMITTEE INTRODUCTION OF BDR 58-2092.
SENATOR LOWDEN SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
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Next was B.D.R. 58-1780.
BILL DRAFT REQUEST 58-1780: Allows conversion of master-metered water system in mobile home park or company town to individual water meters with approval of tenants or occupants of park or town.
SENATOR BROWN MOVED FOR COMMITTEE INTRODUCTION OF BDR 58-1780.
SENATOR SHAFFER SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
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There being no further business, the meeting was adjourned at
10:45 a.m.
RESPECTFULLY SUBMITTED:
Beverly Willis,
Committee Secretary
APPROVED BY:
Senator Randolph J. Townsend, Chairman
DATE:
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Senate Committee on Commerce and Labor
June 7, 1993
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