MINUTES OF THE
SENATE COMMITTEE ON COMMERCE AND LABOR
Sixty-seventh Session
June 9, 1993
The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 8:30 a.m., on Wednesday, June 9, 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:
Assemblyman John Carpenter, Assembly District 33
STAFF MEMBERS PRESENT:
Brian Davie, Senior Research Analyst
Dr. Frank Krajewski, Senior Research Analyst
Sheri Asay, Committee Secretary
OTHERS PRESENT:
Steve Tackes, Lobbyist, Nevada State Cable Television Association,
Joan Clements, Administrator, Department of Commerce, Manufactured Housing Division, State of Nevada
Margi Grein, Lobbyist, Nevada State Contractors Board
Joan Buchanan, Division Coordinator, Department of Commerce, Real Estate Division, State of Nevada
Steve Johnson, President, Appraisal Commission
Fred Hillerby, Lobbyist, Appraisal Institute
Brooke Nielsen, Assistant Attorney General, State of Nevada
Jonathan Andrews, Chief Deputy Attorney General, Civil Division, State of Nevada
Frank MacDonald, Labor Commissioner, State of Nevada
Stan Warren, Lobbyist, Sierra Pacific Resources
Helen Foley, Lobbyist, Psychemedics Corporation
Senator Townsend opened the meeting and announced the bills that would be heard in the meeting.
Steve Tackes, Lobbyist, Nevada State Cable Television Association, addressed the committee regarding Assembly Bill (A.B.) 601. He asked that discussion be postponed for 1 day, to allow time for possible amendments.
ASSEMBLY BILL 601: Provides civil penalty and increased penalty for violation of certain provisions concerning unauthorized interception of services of community antenna television company for commercial advantage.
Senator Townsend opened discussion on Assembly Bill (A.B.) 582.
ASSEMBLY BILL 582: Authorizes manufactured housing division of department of commerce to issue limited license for serviceman.
Assemblyman John Carpenter, Assembly District 33, testified before the committee on A.B. 582. He explained that this bill would make it easier for a contractor to get a license as a serviceman to do specific work on mobile homes.
Joan Clements, Administrator, Department of Commerce, Manufactured Housing Division, State of Nevada, responded to a question by Senator Townsend regarding A.B. 582. She stated that this legislation would give her the authority to draft regulations which would categorize the areas required for examinations, and it would help to attract qualified people to the area. Ms. Clements explained the examination procedure.
Senator O'Connell asked why there has to be a whole new standard for mobile homes. Ms. Clements replied that it is a federal construction standard which is required for mobile homes.
Mr. Carpenter remarked, "...With the passage of this bill we would get many qualified people that would be able to work on mobile homes...." He noted a problem in the rural areas with getting qualified people, and thought this bill would help.
In response to a question by Senator Brown, Ms. Clements explained that a person would be able to identify the individuals, who have this limited license, by information on their identification cards.
There was general discussion on rather or not this examination would include questions about the lien law. Ms. Clements explained that it was not on the exam right now, but that "if they ever...want to file a lien with the division, they can give us a call."
Margi Grein, President, Nevada State Contractors Board, addressed the committee in support of A.B. 582. She stated, "We believe that it pertains to licensed contractors who don't want to get the full license in manufactured housing." She explained that her board has "worked a little bit with manufactured housing towards bridging the gap between the two industries, so that the consumer has protection."
Senator Townsend thanked those who testified on A.B. 582.
SENATOR BROWN MOVED TO DO PASS A.B. 582.
SENATOR NEVIN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Senator Townsend opened discussion on Assembly Bill (A.B.) 561.
ASSEMBLY BILL 561: Makes various changes relating to appraisers of real estate.
Joan Buchanan, Division Coordinator, Department of Commerce, Real Estate Division, State of Nevada, addressed the committee in support of A.B. 561. She explained that they are attempting to bring the appraiser licensing law into accord with federal law.
Ms. Buchanan explained that the proposed legislation would provide for issuance of licenses to out-of-state real estate appraisers if they meet Nevada qualifications. It also provides for the division to be able to submit funds to the federal registry for appraisers, which they are required to do in the amount of $25 per year. Ms. Buchanan added that applicants for real estate licenses can apply from out-of-state. If they pass the exam in the other state, the requirement to take it in Nevada can be waived. She said there would be no fiscal impact to the Real Estate Division as a result of this bill.
Ms. Buchanan explained sections of A.B. 561.
There was general discussion on the appraiser examination. Senator Townsend wondered if the division would know if an appraiser coming from another state would meet our qualifications.
Steve Johnson, President, Appraisal Commission, replied that the appraisal subcommittee requires all exams given in other states be approved by the appraisal foundation.
Mr. Johnson explained that the bill deals with temporary practice in section 2. He said that the appraisal commission is responding to the federal appraisal subcommittee, which believes Nevada to be restraining trade. Mr. Johnson said that the proposed legislation also involves reciprocity with other states, and added:
We're asking that you grant the appraisal commission the ability to negotiate with other states that have laws similar to ours, and if they are similar or...equivalent to ours, we will enter into a reciprocity agreement, which means we will be able to grant an applicant from that state a license in this state. The third issue that we're dealing with is, we are going to take out a reference to obtaining your appraisal experience within 5 years....
Mr. Johnson explained that the time limit "has been unworkable, and it also brings some difficulties in the reciprocity situation."
Mr. Johnson concluded his summary of the bill, by explaining that "the division is asking for allocation of the fees, that have to go by federal law to pay for the appraisal registry, be able to be retained in the real estate division for payment of those fees."
In response to a question by Senator Brown, Mr. Johnson replied that if appraisers come to Nevada, and do not do the proper research in this state, they would be in violation of Nevada law.
Senator Brown asked, "Unlike reciprocity in most fields, this statute for reciprocity doesn't require any previous experience, does it?" Mr. Johnson responded, "That's why we want to be able to negotiate with the other states, and review their previous experience and their licensing requirements." He remarked that other states are adopting very minimal levels of requirement for licensing. Mr. Johnson added, "...I think our law still says that for reciprocity their law will have to be substantially equivalent to ours."
In response to a question by Senator O'Connell, Mr. Johnson responded that nothing in section 5, subsection 3 exceeds the federal requirements.
Senator Brown asked, "Do the other states around us allow our appraisers to go over there and get temp [temporary] licenses and reciprocity?" Mr. Johnson responded affirmatively. Ms. Buchanan added, "On the temporary permit, they have to pay a fee of $75, provide the division a copy of their license or certificate, they have to sign a notice of service, an affidavit they've read the statutes and, the important thing is, they have to provide a letter of assignment." She noted that the temporary permit is only good for one assignment.
Fred Hillerby, Lobbyist, Appraisal Institute, testified in support of A.B. 561.
Senator Townsend closed discussion on A.B. 561.
SENATOR NEVIN MOVED TO DO PASS A.B. 561.
SENATOR O'CONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Senator Townsend opened discussion on Assembly Bill (A.B.) 601.
Mr. Tackes stated that Nevada State Cable Television Association supports A.B. 601 in its current form. He explained that this bill "addresses a new type of crime...people who go out and start a business of manufacturing devices to defraud cable companies."
Mr. Tackes commented that the legislation is almost an exact replica of the federal law. He noted that the money accrued from civil penalties would remain in the state, and would go to the local government.
At Senator O'Connell's request, Mr. Tackes explained how the defrauders operate. Senator Townsend elaborated on cable television operations with regard to the local government. He stated that there is a "contractual arrangement in federal, state and local regulation vis-a-vis, how that gets to the consumer from the original broadcaster. Anyone who interrupts those agreements, becomes a pirate, per se." Mr. Tackes concurred with that assessment.
Senator O'Connell wondered if a cable product manufacturer always has to have an agreement with the local government to purvey their goods. Mr. Tackes said that was true.
Senator Townsend further explained:
We used to regulate cable television at the Public Service Commission....Because it was harder for the consumer to get to the PSC to voice their objections to the kind of service, the kind of reception they received, we decided that it was more important, that the local government, who was closer to the consumer, have that opportunity. So we shifted that responsibility to the local government, and there was a development there in franchise fees to deal with that.
Senator O'Connell clarified that her concern was whether or not there was a restraint of trade involved. Senator Townsend replied, "Not any more." Mr. Tackes agreed.
Mr. Tackes explained how this legislation would be enforced, at the request of Senator O'Connell.
There was general discussion on cable converters and various pirating methods.
SENATOR NEVIN MOVED TO DO PASS A.B. 601.
SENATOR O'CONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Senator Townsend closed the hearing on A.B. 601, and opened the discussion of A.B. 235.
ASSEMBLY BILL 235: Establishes and revises various fines and penalties.
Senator Townsend announced a short recess at 9:20 a.m.
The meeting reconvened at 9:35 a.m.
Brooke Nielsen, Assistant Attorney General, State of Nevada, testified on A.B. 235. She stated that this bill would "...raise outdated and ineffective fines for occupational, or other licensing boards. It also establishes some fines where none have existed, and therefore there has been no administrative enforcement power." Ms. Nielsen read from a letter sent to the committee by the Attorney General Frankie Sue Del Papa (Exhibit C).
Ms. Nielsen provided a chart, corrected from the original June 8 version, which she said tracks the entire bill section by section (Exhibit D).
Ms. Nielsen explained the amendments to A.B. 235 (Exhibit E).
She spoke about fines on taxi drivers and mentioned a letter by Sven Nilsson, (Exhibit F). She said she agreed with his concerns, but misunderstood "that they indeed objected to having minimum penalties for taxicab drivers." Ms. Nielsen stated that sections 44 and 45 of Exhibit D should have been deleted.
Senator Townsend praised the efforts of Sven Nilsson, saying he was "very gentlemanly and professional in his approach."
Ms. Nielsen explained that she had contacted Mr. Nilsson regarding the amendments and that they are in agreement. She added, in response to a question by Senator Townsend, that Mr. Nilsson is a cab driver and also represents a group of drivers.
Ms. Nielsen stated that A.B. 235 came as a result of the attorney general's specific direction, because she "had received comments both from our attorneys, and from agencies that we represent, that the statutes were so outmoded with regard to the fines that they could impose, that they weren't serving the purpose that they were designed to serve, that is to deter misconduct...."
Ms. Nielsen said that the question arose as to how the Attorney General's Office (AGO) arrived at the level of fines they are imposing. She explained that the fines are tailored to the type of violation, and to what the agencies and the AGO lawyers think would be effective as deterrents in today's economy.
Senator O'Connell expressed displeasure that the fines collected go to the General Fund, rather than to the AGO. She remarked that the attorney general is asking for funds to increase staff, and that the fines collected should go to pay for the increased help.
Ms. Nielsen responded, "...There is no fiscal note from our office on this because these are violations that we're already responsible for. When a case occurs, we already handle it. All that's changing is the maximum, the possible penalty...."
Senator O'Connell inquired about, "...the ones that never had a fine before. Now what are you going to do?" Ms. Nielsen replied, "In those cases, the agency and our deputies are already looking at those violations. The only enforcement ability, for example the pesticide violations, is a criminal one. Today, the deputy who represents the agriculture agency did not feel that he would not be able to deal with the cases, there aren't that many...."
Ms. Nielsen stated there would be a minimal amount of extra work with this legislation.
Senator O'Connell asked why the department did not keep the fines collected to help with department enforcement expenses. Ms. Nielsen explained that legislative action did not allow agencies to keep money they collected.
Senator Townsend agreed with Senator O'Connell's concerns, and added:
The points are not necessarily about the agencies, but more about the independently funded boards. And of course we like to think that we allow business practices to be licensed, they pay for that license, it stays independent and we get the bad guys, using that regulatory authority. In the case of agencies, we believe that the same thing [that] occurs there, with regard to penalties and fines, should come back into your budget, that you can argue either should offset General Fund costs or be added to it as a supplement, in order to increase your regulatory authority.
Senator Townsend remarked that this is an unstable source of funding, "...so it must be accommodated in a different manner than normal courses of funding. But that does not preclude it from being your budget and not the General Fund's budget." He expressed concern that every time legislation is passed requiring more regulation, the AGO asks for more staff.
Ms. Nielsen said that was a policy question and that the fines are not something new, except in the agriculture penalties. She stressed that her department is attempting to make the fines more effective.
Ms. Nielsen explained the problem of due process, with regard to an agency keeping the fines and penalties they collect. She quoted a 1982 Nevada Supreme Court decision, which said if a board imposes a fine, but the board also controls the agency budget and keeps the fines collected, a due process situation exists.
There was general discussion on the due process problem. Ms. Nielsen explained that A.B. 235 addresses that situation. She said that an agency board "as a whole" cannot sit on a disciplinary matter, because they also control their own budget. Instead, they must appoint a hearings officer, or a subcommittee of the board. She further explained the safeguards provided in the bill, in this regard.
Senator O'Connell expressed concern about the agencies having to impose higher fines on their members, regulate and discipline their members more, and still having to raise their fees to pay for investigators. Ms. Nielsen said this was a fiscal concern, and that the focus of the AGO is enforcement. She explained that "...if the legislature wanted to change the way all of these agencies are funded, you would have to have that due process provision also, so they could recover some of those costs."
Senator Townsend suggested:
What if we took all of the fine and penalty money, and put it into an account at the state level, and then it was not apportioned, but simply rebated to the board or the commission or the agency on an equal share basis. That would overcome the keeping of the money, due process question. It also might overcome the unreliable source issue. If you only know that every year you're only going to get a $3000 or $4000 rebate, you can count on that....
He further explained that the fines collected would go into an escrow account, as opposed to the General Fund.
Ms. Nielsen responded that currently under Nevada Revised Statutes (NRS) 353.249, it is mandated that unless there is a specific provision, all monies collected go to the General Fund.
Ms. Nielsen introduced Jonathan Andrews, Chief Deputy Attorney General, Civil Division, State of Nevada. She said his division is responsible for the majority of the agencies, boards and commissions involved in this legislation. Ms. Nielsen stressed that the heads of the various agencies support A.B. 235.
Senator Shaffer asked if it would be more of a deterrent to suspend the offender's license rather than impose a fine. Ms. Nielsen replied that the agencies have the authority to suspend a license, as well as impose a fine, and that they do so in some instances.
She reiterated that the fine allowed is a maximum, and would be tailored to meet the offense.
Frank MacDonald, Labor Commissioner, State of Nevada, stated his support of A.B. 235, which he said is more of a deterrent than a punishment.
Ms. Grein stated the Nevada State Contractors Board supports A.B. 235, sections 2 and 3, but she expressed concern about the fines collected going into the General Fund. Ms. Grein added that the proposed amendments to the bill allow the board to cover their costs of investigative procedures on certain cases.
Ms. Buchanan expressed support of A.B. 235 by the Real Estate Division. She said the division collected $14,000 in fines last year in disciplinary hearings.
Senator Shaffer reiterated concern about agencies being able to keep the fines collected. He cited a case where that authority was abused.
SENATOR NEVIN MOVED TO DO PASS A.B. 235.
There was discussion on the amendments to the bill. It was decided to postpone action on A.B. 235 until the amendments are ready.
Senator Nevin withdrew his motion.
Senator Townsend opened discussion on Senate Bill (S.B.) 231.
SENATE BILL 231: Requires public service commission of Nevada to adopt regulations authorizing public utilities to provide electricity to steel mills at flexible or interruptible rates.
Senator Adler addressed the committee on S.B. 231, and referred to an amendment (Exhibit G).
Senator Townsend discussed the changes in the amendments.
Senator Adler stated:
I talked to Dick Franklin, from the Assessor's Association, Washoe County. And he said they looked at it from the standpoint of could they calculate the reduction in personal property tax, could they pass that on, could they undo it mechanically, and could they be assured then that they would have sufficient money flowing in from the counties....it's new equipment, new property and they can segregate that and calculate it...from an assessment standpoint, it works.
In response to a question by Senator Brown, Senator Townsend explained that the amendment phases out the Commission on Tourism over an 18-month period, and transfers the money they receive to the Commission on Economic Development (CED).
Senator Townsend stated:
...For the state to be in the advertising and tourism business, when in fact we spend between $50 and $100 million dollars a year, every year, in the private sector to do that, that probably is not the best place to spend our money. There is no attempt in here to reallocate the money once it gets to the Commission on Economic Development. That's their business, they're a commission appointed by the Governor. They're going to make whether they put it into the block grant program for rural communities, or the film division. They'll make those determinations. So I offer that. Whether you want them in the same amendment or not, that's your business. I just have to get off that on the record, so that we kind of support the concept of what we're trying to do in this committee to increase economic development.
Senator Lowden stated her opinion that the Commission on Tourism does not do much for the state. She said that those involved in tourism spend their own money to market their businesses.
There was general discussion on the shifting of money from the Commission on Tourism to the CED. Senator Nevin thought the issue should be separate from the remainder of the bill.
Senator Townsend proposed that the amendments be separated.
SENATOR NEVIN MOVED TO AMEND AND DO PASS S.B. 231.
SENATOR LOWDEN SECONDED THE MOTION.
Senator Adler read a press release from Cargill, the parent company of Northstar Steel, involving a mini-mill which may relocate to Wabuska, NV.
There was general discussion on Northstar Steel's possible relocation to Nevada or Arizona. Senator Adler said he thought Nevada Power and Sierra Pacific would be able to offer a more competitive power rate than the other states involved.
Stan Warren, Lobbyist, Sierra Pacific Resources, stated that Nevada has been very competitive, and the rates have not been a stumbling block. Senator Adler responded that the companies want Nevada to be "able to offer the absolute lowest rate in the west." He added that with this legislation, "...we were getting close to being able to do that."
Senator Adler discussed other areas in which state agencies are working with businesses considering moving to Nevada.
Senator Townsend called for a vote on the motion to amend and do pass S.B. 231.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Helen Foley, Lobbyist, Psychemedics Corporation, addressed the committee regarding Senate Bill (S.B.) 440.
SENATE BILL 440: Includes test of person's hair as permissible test in certain circumstances to determine presence of controlled substance or other chemical.
Ms. Foley referred to an amendment to S.B. 440 (Exhibit H). She said she thinks the most important part of the bill is the pre-employment screening. Ms. Foley discussed hair testing, and explained when it would be used for state employees, according to Nevada law. She remarked, "The state is not mandated to use hair testing, it is just another tool."
Ms. Foley noted that the screening test has to be "conducted by either the National Institute on Drug Abuse, which only does urine testing, it does not do hair, or, pursue it to the Clinical Laboratory Improvement Amendments of 1988...."
Senator Lowden asked if Senator Townsend wanted a motion made on S.B. 440.
Senator Townsend said, "Our firm represents a hair test company, and so I won't vote or participate...."
Senator Nevin commented, "...In my opinion, it [hair testing] just hasn't been scientifically proven to be reliable beyond a reasonable doubt."
In response to a question by Senator Brown, regarding whether a person could appeal the test results, Ms. Foley responded, "...they certainly could request another form of test...although it's been determined by a federal court that it can be used in a court of law and that it is reliable."
Senator Shaffer reiterated that this legislation does not mandate hair testing.
SENATOR SHAFFER MOVED TO AMEND AND DO PASS S.B. 440.
Senator Lowden asked if the committee would like to postpone action on S.B. 440 to allow time for further study.
Senator McGinness asked if an employee has the option, initially, to take the hair testing. Ms. Foley said, "I believe it is the employer, but the employer would have to feel comfortable that this provided all the safeguards that any other test did."
Senator McGinness referred to Amendment No. 769 to Senate Bill (S.B.) 458.
SENATE BILL 458: Enlarges locations and products for sale by local wineries.
SENATOR NEVIN MOVED TO AMEND AND DO PASS S.B. 458.
SENATOR LOWDEN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
SENATE BILL 210: Clarifies which entity certain contractors are to furnish proof of industrial insurance.
The amendments to S.B. 210 were discussed.
SENATOR O'CONNELL MOVED TO CONCUR WITH AMENDMENTS NO. 585 AND NO. 730 TO S.B. 210.
SENATOR BROWN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
There being no further business, the meeting was adjourned at 10:35 a.m.
RESPECTFULLY SUBMITTED:
Sheri Asay,
Committee Secretary
APPROVED BY:
Senator Randolph J. Townsend, Chairman
DATE:
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Senate Committee on Commerce and Labor
June 9, 1993
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