MINUTES OF THE
SENATE COMMITTEE ON FINANCE
Sixty-seventh Session
March 23, 1993
The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:00 a.m., on Tuesday, March 23, 1993, in Room 223 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda. Exhibit B is the Attendance Roster.
COMMITTEE MEMBERS PRESENT:
Senator William J. Raggio, Chairman
Senator Raymond D. Rawson, Vice Chairman
Senator Lawrence E. Jacobsen
Senator Bob Coffin
Senator William R. O'Donnell
Senator Matthew Q. Callister
COMMITTEE MEMBERS ABSENT:
Senator Diana M. Glomb
STAFF MEMBERS PRESENT:
Daniel G. Miles, Fiscal Analyst
Robert Guernsey, Principal Deputy Fiscal Analyst
Jeanne L. Botts, Program Analyst
Judy Jacobs, Committee Secretary
OTHERS PRESENT:
John R. Crossley, Director, Legislative Counsel Bureau
Donald J. Mello, Court Administrator, Office of Court Administrator, Supreme Court
Judy Matteucci, Director, Department of Administration
William Gosnell, Administrative Services and Fiscal Accounting, Department of Motor Vehicles and Public Safety
Tom Stephens, P.E., Manager, State Public Works Board
Senator Raggio inquired if there were any bills for committee introduction or bill draft requests. Being none, he opened hearings on the bills appearing on the agenda.
SENATE BILL 264: Makes appropriation to budget division to reimburse legal division of legislative counsel bureau for expenses involved in preparing bill drafts requested by state agencies.
John R. Crossley, Director, Legislative Counsel Bureau, described the provisions of Senate Bill (S.B.) 264, which he stated "appropriates $100,000 to the Department of Administration for bill drafting incurred by the executive branch and the Supreme Court branch." He said the bill was based upon Nevada Revised Statutes 218.248 which provides that the hours spent drafting bills for the two branches should be allocated and expensed to them.
Mr. Crossley estimated $100,000 would be sufficient to cover time expensed on behalf of the executive branch of the government, and the expenditure was approved by the Legislative Commission. He calculated 3,200 hours had been spent preparing bill drafts requested by the executive branch as of March 5, 1993. He said hours expended on behalf of agencies are approximately the same this session as at the same point last session.
Senator Coffin inquired how much time had been expended on drafting reorganization legislation. Mr. Crossley agreed it is a major project and said approximately 314 hours had already been expended on legislation for the Department of Administration as of February 29, 1993, most of which could be attributed to the reorganization.
SENATE BILL 18: Makes appropriation to supreme court of Nevada for costs of temporary relocation of Las Vegas office.
Donald J. Mello, Court Administrator, Office of Court Administrator, Supreme Court, declared the request for funding under S.B. 18 was being made in the event it should become necessary for the Supreme Court to vacate the premises in the Bridger Building in Las Vegas owned by Clark County. He explained Clark County may undertake an asbestos abatement program in that building from which the Supreme Court rents space. He said Clark County had advised the Supreme Court to seek the funds in the event the project is moved forward.
Mr. Mello said the amount of $15,479 was requested last session. He recalled it was based upon estimates of costs to move and store furniture, to provide some funds for rent for the two staff members while they are moved to temporary quarters and to disconnect and reconnect telephone service.
Senator Raggio asked if the funds appropriated at the last session and not used would revert back to the General Fund. Mr. Mello confirmed the query. Senator Raggio wondered if a change in the reversion date would suffice instead of passing a new bill. Mr. Mello declared the funds would revert on June 20, 1993, under the former legislation.
Senator Raggio requested that Mr. Mello submit an itemization of the $15,479 request.
Senator Callister asked why the Supreme Court could not simply make the request of the Interim Finance Committee (IFC). Mr. Mello admitted that would be possible. Senator Callister pointed out Clark County is in the process of trying to construct a new county building and asbestos standards change daily. He suggested it might be more simple to go before the IFC if and when it became necessary to move the Supreme Court offices in Las Vegas. Mr. Mello agreed that would be acceptable.
Senator O'Donnell asked if the state paid rent to Clark County. Mr. Mello confirmed rent was paid to Clark County at a rate he asserted was less than that paid by other tenants in the downtown area of Las Vegas. He guessed the rate was less than $1.15 per square foot.
Senator O'Donnell asked if Clark County preferred to have the Supreme Court move out permanently or if the county desired to have the court continue to rent the space. Mr. Mello replied Clark County would prefer that the Supreme Court leave. He said the lease came up for renewal about a year ago and the county requested the Supreme Court to not exercise the option because the county needed the space. He said the rate is based upon an escalation clause tied to the Consumer Price Index (CPI) which has caused the rent to increase annually.
Senator O'Donnell asked if the contract included a provision in which Clark County would assume any expenses to move the court in and out while asbestos removal was being done. Mr. Mello said the lease contract had been entered into many years ago, prior to the time the problem with the building was known. He added Clark County officials had considered the favorable rate offered to the state as "ridiculously low" which would have precluded negotiating moving expenses for renovation projects.
Senator Jacobsen asked if a moving and storage company would be used. Mr. Mello stated that was what the court contemplated. Senator Jacobsen asked if honor camp crews might be considered. Mr. Mello replied those crews would be considered to the extent that the Supreme Court relies upon the Buildings and Grounds Division. He said other constitutional officers have recommended against using the Buildings and Grounds Division because honor camp crews had allegedly caused substantial damage to the walls and furnishings during one move.
There was no further testimony on the bill, and the hearing was closed on S.B. 18.
SENATE BILL 21: Makes supplemental appropriation for district judges' salaries and judicial pensions.
Mr. Mello stated $12,191.59 is the amount owed to the Public Employees' Retirement System (PERS). He explained there had been an error in the central payroll system of the state and the payment for one district court judge's Public Employees' Retirement System (PERS) contribution had not been made. The amount includes interest through June 30, 1993, so the amount would be recalculated if the legislature appropriates the sum prior to that date and a reversion would be made to the General Fund.
Senator O'Donnell asked for an explanation of the error. Mr. Mello said the coding had been correct, but PERS did not receive the bi-weekly contribution for approximately 9 months. Senator O'Donnell asked if Mr. Mello meant $12,000 was the sum due for retirement. Mr. Mello explained that included interest because the sum has been outstanding since July 20, 1989.
Mr. Mello confirmed Senator Raggio's conclusion the mistake had not been incurred in any way by the recipient judge.
In the absence of further comments Senator Raggio closed the hearing on S.B. 21.
SENATE BILL 194: Makes supplemental appropriations for district judges' salaries and judicial pensions.
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Senator Raggio called attention to the sums requested in the measure. Mr. Mello declared the amount in section 1 was being requested to pay the PERS contribution for new district judges who were seated in January of 1993. He reminded the committee those judicial positions had been established through action of the last legislative session, and most of those judges had elected to join the PERS system which requires a contribution from the Supreme Court office.
Mr. Mello explained, "Section 2 is to cover additional pensions which...the amount has been adjusted for reductions in expenditures for those for a judge and/or widow that passed away." He said there are three new judges receiving pensions since the last legislative session and one new widow. He added one judge and two widows had passed away during that period so the total includes those reductions.
Senator O'Donnell inquired if there had been actuarial calculations made during the tenure of the judges and, if so, why a supplement of $79,273 was necessary. He figured payments should have been made all along to cover the pensions. Mr. Mello replied there are two pension plans available to members of the judiciary. He indicated those are the judicial retirement plan available in Chapters 2 and 3 of the Nevada Revised Statutes (NRS) or the PERS system. He said the PERS system is actuarially based and funded on an ongoing basis, whereas the judicial retirement plan is not actuarially based. Under the latter circumstance, he said, each time a person retires the Court Administrator must return to the legislature to request funding for the pension.
There was no further testimony on S.B. 194 and the hearing was closed.
SENATE BILL 238: Makes supplemental appropriation to supreme court of Nevada.
Mr. Mello reported the commission met twice during the fiscal year to make selections and for a business meeting. He said at the time the bill draft was prepared last November it had been anticipated there might be two more selections necessary during the fiscal year. Although there was still that possibility, he admitted it was less likely to be necessary.
Mr. Mello said there are still claims outstanding in the approximate amount of $700 as a result of the last selection. He requested the remainder, $6,300, be made available for any new selections that might come up in the remaining fiscal year. He pointed out any surplus of those funds would be reverted to the General Fund if no need for the funds should arise.
Senator Raggio asked for confirmation that the funds would revert since the bill does not so state. Mr. Mello replied that was his understanding according to the previous act setting up the original funding.
In the absence of further testimony, Senator Raggio closed the hearing on the measure.
SENATE BILL 266: Makes supplemental appropriation to Nevada equal rights commission for certain expenses.
Senator Raggio said S.B. 266 constituted a request for an appropriation of $1,632 to the Equal Rights Commission for an unprocessed merit salary increase for an employee.
Dr. Carlos D. Romo, Assistant Director, Nevada Equal Rights Commission, verified the appropriation being requested came about as the result of an overdue salary increase for an employee who was promoted from a grade 32 step 13 to a grade 32 step 15. He explained the money was to be appropriated from account number 2580, but at the end of fiscal year 1991 the balance in the account was insufficient.
Dr. Romo said because the money was not available and the paperwork had not been completed the merit increase did not take effect. He continued, "It wasn't until the current executive director signed the NPD 35 [Nevada Personnel Department action form] that request was made. The request for the salary increase is due pursuant to NAC 284.194 [Nevada Administrative Code] and NAC 284.202."
Judy Matteucci, Director, Department of Administration, pointed out S.B. 266 is included in the Governor's Executive Budget.
Testimony on the bill concluded with no further comment.
SENATE BILL 289: Corrects statutory reference to require that certain fees be deposited in state highway fund.
William Gosnell, Administrative Services and Fiscal Accounting, Department of Motor Vehicles and Public Safety, reported when the overview of the budget was presented during joint committee hearings the committee staff pointed out the need for S.B. 289 to make technical corrections. He explained during restructuring of funds in the 1991 session the funds referred to in Nevada Revised Statutes 459.710 inadvertently were transferred to the General Fund when they should have remained in the highway fund.
Mr. Gosnell stated the fees are collected by the Nevada Highway Patrol from the transportation of hazardous materials. Those fees are disbursed 80 percent to the highway fund and 20 percent to State Emergency Response Commission (SERC), he said. He requested that the mistake be corrected back to July 1, 1991.
Senator O'Donnell asked if the bill would continue to require 20 percent of the fees collected be distributed to SERC. Mr. Gosnell replied 20 percent of the fees had been disbursed to SERC in the past and they would continue to be distributed in that proportion.
In the absence of further testimony the hearing on S.B. 289 was closed.
SENATE BILL 306: Makes appropriation to state public works board for certain capital improvement projects.
Tom Stephens, P.E., Manager, State Public Works Board, distributed a packet of data (Exhibit C) which included pages from the Capital Improvement book relating to projects referred to under S.B. 306. He stated the purpose of the bill is to implement four capital improvement programs which should be commenced prior to the end of the legislative session. He gave an overview in explanation of why the projects need to be started early.
Mr. Stephens declared the first project to be activated by the bill would appropriate funds for the Southern Nevada Adult Mental Health Services (SNAMHS) building in Las Vegas. He asserted, "The cooling tower down there is on its last legs," it had been leaking, and the design caused condensation inside the mechanical penthouse which in turn caused water damage to the lobby. He insisted any repairs to be done should be accomplished prior to the heat of summer, and he requested approval in time to complete repairs before the first of June.
Mr. Stephens said the second project encompassed installation of footings on a second fence around the prison at Jean. He admitted it would be impossible to complete the fencing before the date on which the prison is scheduled for reactivation but he assumed the project could be finished by the end of July.
Mr. Stephens described the third set of projects as the remodeling of the Fremont School and of the old State Library. He declared the designs for those have already been started as in-house projects and should be completed as soon as possible in order for the facilities to be remodelled and ready for occupancy by July 1, 1994.
Mr. Stephens said the Department of Education will move into the Fremont School whether the department is reorganized or not. He said the building on the west at Fremont School will be large enough to accommodate the department. The remodeling will include the hearing system, lights, electricity, fire sprinklering, bathrooms and ADA (Americans with Disabilities Act) requirements. The other building, he said, would house the Hearings Division and Appeals office of the Department of Administration and the Nevada Attorney for Injured Workers.
Mr. Stephens commented the Division of Economic Development, the Division of Tourism and Nevada Magazine are scheduled to move into three floors of the old State Library. He said the basement and fourth floor of that building may be used for storage, but no extensive remodeling is contemplated for those two areas. He described the type of remodeling in the old State Library as "very light" in order to preserve the historic aspects of the building without going as far as historic restoration. He said the elevator needs repairs as does much of the plumbing and there are several projects to comply with ADA.
Senator Raggio asked if the work contemplated for the old State Library would be a serious impediment to any later project for complete restoration of the building. Mr. Stephens replied, "We do not plan to do anything that's going to interfere with any later restoration project, or damage any of the existing materials." He acknowledged the prospective tenants had not yet been consulted regarding the design, but the intention is to retain as much of the original character of the building as possible. If a complete restoration may be done at some future date, he admitted the tenants might have to move out temporarily.
Senator Raggio expressed concern that if some of the old woodwork were removed or destroyed it would make an eventual restoration difficult or impossible. Mr. Stephens assured him the building would be protected and it would become a showcase for the agencies moving into the building.
Senator Callister recalled there had been some restrictions on the original deed to the building which would limit noneducational or nonlibrary usage. He asked if his memory was correct. Mr. Stephens assured him the types of agencies scheduled to move into the building would satisfy the requirements of the deed restrictions.
Senator Coffin asked to hold the part of the bill relating to the old State Library. Senator Raggio stated his intent to hold the entire bill because a presentation will be made later in the week regarding restoration if time would permit.
Mr. Stephens responded time was becoming a problem and suggested the portion of the budget dealing with design could be appropriated right away. He said the design cost for the Fremont School would be $127,000 and for the old State Library the cost would be $29,000. He conceded 80 percent of those amounts would be sufficient because the other 20 percent would not come due until
construction was under way.
Senator O'Donnell asked if all the items were included in the Governor's Executive Budget. Mr. Stephens replied they were. He said the sums were exactly the same, but if the legislature should decide not to proceed with the projects some of those funds would be returned because the project could be stopped at any time when it was determined it would not go forward.
Mr. Stephens called attention to the project cost-estimate sheets contained in Exhibit C. He said, "If you look at...the A/E Design/Supervision line, if you appropriated that amount of money we could go ahead and even get some plan checking done by borrowing [from] Peter to pay Paul until you make the full appropriation."
Senator Raggio asked if the design work would be done by the State Public Works Board staff. Mr. Stephens replied, "Absolutely, it's going to be done by our staff. But if we commit our staff to do this design work that means there will be other design work we won't be able to do, and we're getting to be a fee-based agency." He declared he could not have his staff working on projects for which no fees would be collected.
Senator Raggio inquired how long it would take to draft a design for the old State Library building. Mr. Stephen turned to the last page of Exhibit C and pointed out the schedule called for commencing the design by the first of May. He said:
If we could start by the first of May and follow this schedule on down, and the various milestones are there in the design, then we could meet a facility move-in operational date at the first of July, 1994, which is what we're targeting.
Mr. Stephens advised it would be unwise to leave a building vacant for a long time. If the legislature should decide to leave it vacant, he declared his department would do everything possible to protect it.
Making reference to vacant buildings, Senator Raggio asked if the State Public Works Board and the Department of Prisons had determined who would maintain the new Lovelock facility in the event it is not opened. Mr. Stephens replied it was his understanding an appropriation will be requested of the Department of Prisons by the Governor to pay for utilities and operation of the facility.
In response to a query regarding the honor camps Mr. Stephens said he had no knowledge of what was planned. Senator Raggio asked if the Budget Division would have an answer before the end of the session. Ms. Matteucci said she had seen nothing upon the subject. Senator Raggio recalled a discussion regarding funds for prison maintenance. He suggested there would be maintenance costs if the honor camps were closed. He asked if maintenance costs for closed honor camps were included in the budget. Ms. Matteucci replied:
My recollection is that the prisons felt comfortable that they could maintain the honor camps if they were closed without additional appropriation. There was some miscommunication relative to what we were going to do relative to Lovelock, and I know that the Department of Prisons is working on that, but also right now it has not been submitted...to my office.
Senator Raggio asked if the prison subcommittee had received any information on the subject. Mr. Stephens interjected a meeting was scheduled for the following day with the Sierra Pacific Power Company regarding minimum charges. He said, "That's the last piece of the puzzle as far as what it's going to cost us to keep Lovelock mothballed." Senator Raggio pointed out the honor camps will have to be maintained and thus more information should be forthcoming soon.
Senator Jacobsen added the subcommittee regarding prisons had reviewed the various aspects of the problem at one meeting and they planned to visit some honor camps on the following weekend.
Senator Jacobsen noted there was nothing in the fencing at Jean which could not be done by the honor camp crews there and he added they could even walk to work. He suggested there was no reason honor camp inmates could not do the work and asked for comment. Mr. Stephens responded, "If somebody wanted to act as the foreman, superintendent and the general contractor, make sure the concrete trucks got there, that the whole thing was done, yes, but it wasn't suggested to us by the prisons that the honor camp do it."
Senator Jacobsen averred that was the type of job the honor camp crews do best. Mr. Stephens responded it was possible that it had never been suggested that the honor camp inmates should perform the work. He admitted the job will be relatively simple in which a trench will be dug and cement poured into it. He said, "If they can provide the labor...then somebody has to figure out how to coordinate all the materials.... Someone has to act as a general contractor." Senator Jacobsen commented, "If we can build fire houses...we can sure pour some cement in a ditch."
Ms. Matteucci declared:
The only reason that this one was put in there was at the request...of Assemblyman Spitler. We suggested that if there were some maintenance projects that could be done before we reopen Jean that he thought that was a good idea. This was the only one that the [State] Public Works Board felt could really be completed while that facility was mostly empty according to the plan that's been presented to the legislature.
Ms. Matteucci added she was unsure what the timeliness issue would be if honor camp crews were to be used. She agreed to explore the suggestion with the Department of Prisons. Senator Jacobsen concurred it should be investigated because the honor camp and equipment were so near. Ms. Matteucci doubted the prison had a cement truck available. Mr. Stephens said an estimate of the cost to repaint the prison had been requested, and he assumed the paint was for use by honor camp crews. He asserted the painting would be a "massive" project and would keep the honor camp crews busy.
Mr. Stephens said he could provide the dollar amount attributable to the materials. Senator Jacobsen replied he believed that would be advisable, and he would contact supervisors at the honor camp
to ascertain whether they could handle those jobs.
Senator Coffin reported he had looked into the matter of the new state office building in Las Vegas and the utilization of space by state agencies scheduled to move into it. He declared Mr. Stephens and his deputy, Roger E. Grable, had provided convincing evidence that agencies would not be expanding their usage of space when they move into the new building. He asked Mr. Stephens to elaborate.
Mr. Stephens responded:
Getting all of these agencies into the building, you have to figure out what all the space is. Now if we're going to change somebody around and do something different then we have to go back to talking with every agency and move everybody around. What we do recognize, however, is, from the reorganization and the right-sizing of state government, there may be some space which is going to not be fully utilized.
Mr. Stephens stated he was already trying to identify what other leased space in Las Vegas may not be used and thus which agencies could be moved into the new building. As an example he pointed out the Department of Conservation and Natural Resources will be bifurcated and they will not have all their present positions filled. He conjectured another small agency might be accommodated in the office space saved.
Mr. Stephens said the State Public Works Board and the Buildings and Grounds Division were going to analyze the situation all over the state because the number of jobs has been reduced but the amount of floorspace has not been reduced. He averred the reorganization may cause more floor space to be left available in leased premises throughout the state. He estimated there could be a savings of 5 to 10 percent of the space presently in use.
Senator Coffin ventured the interior wall construction on at least five floors of the new Las Vegas building would be constructed in a manner that would enable adjustments to be made in the future. Mr. Stephens concurred some adjustments will be possible, such as new doors, and much of the area will be adaptable to modular walls. He said, "It's not as open as some buildings but it's not as closed as most of our buildings. ...It's a kind of a compromise between the two."
Senator Raggio asked if the bonds had been sold or when they were scheduled to be sold for the new state office building. Ms. Matteucci replied most of them have already been sold. Mr. Stephens said bids would open on May 20.
Ms. Matteucci said:
There is a request in this budget to utilize $1.2 million in existing bond authority and reallocate it to complete the state office building site-work and then there's also a General Fund appropriation for the equipment for the new building and that would be the money necessary to complete it. But the big amount of bonds were sold in September...or October of 1991.
Mr. Stephens reiterated the bonds were ready to go to bid. He said:
If we get unusually favorable bid prices, and we're below the estimate, what we would recommend is reducing the appropriation for the furniture and the fences and things and taking some of that out of the original project and this other project we have to appropriate these extra things would become a smaller project that's in the `93 program. That would reduce the `93 recommendation from the Governor.
Senator O'Donnell asked, in light of down-sizing of government and consolidation of space, how much space in the new Las Vegas office building will be vacant. Mr. Stephens admitted he had not done an assessment but declared he had alerted his people to the possibility space would be available. He has advised them extra doors or extra walls might be installed in order to accommodate more people once the reorganization is completed.
Mr. Stephens averred the assessment will be done once the legislature comes to a decision on the Governor's proposed reorganization. After that, he said, people will be relegated to the new building if additional space is available. He avowed his goal is to utilize all the space.
Senator O'Donnell inquired if the revenue from bonds which have already been sold had been distributed to the State Public Works Board. Ms. Matteucci said the bonds had been sold in September or October of 1991 and the proceeds have been retained in an interest-bearing account. She said, "The interest from those bonds and all the other bonds that were sold at that time goes back into the debt-redemption account to offset the need for additional property taxes to pay for our principal and interest payments."
Senator O'Donnell asked if the bond was an encumbrance against the building. Ms. Matteucci replied, "Oh, yes, they're identified for the projects for which they were sold. The bonds that we're recommending be reallocated will take some adjustment of the bond covenants, but it is allowable."
Senator Coffin mentioned the movement of $1.3 million in bond money or the authority to do some work on the new Las Vegas office building. He inquired, "Would any of that impinge on the authority or the work--on the ability to do the architecture building at UNLV (University of Nevada, Las Vegas)?" Ms. Matteucci replied it would not. She said, "That project...is not recommended for reallocation." She said those bonds were also sold and the architecture building will continue as planned.
Senator Coffin asked Ms. Matteucci and Mr. Stephens to elaborate on previous discussions relating to the plans for the architecture building. Ms. Matteucci stated it had been the position of the State Public Works Board that nothing could be done since a challenge had been filed in court relative to an opinion rendered by the Commission on Ethics.
Senator Coffin responded it could take years before there is a resolution to the court challenge. He wanted to know if there was an obligation to go ahead and construct the building and resolve the problems later. Ms. Matteucci suggested, "I don't know that we can do that because...the ethics commission indicated that they did not believe that the selection of the architect that was chosen by the public works board was appropriate."
Senator Coffin argued, "We've had the ethics...commission here and they say there's nothing that they have done that should impede the project." Ms. Matteucci responded, "They had an opinion that says that we awarded it to the wrong contractor, and...then that particular position has been appealed...by the person who lost before the ethics commission, who is the contractor that we chose." She suggested it might not be productive to move forward prior to a resolution by the court.
Senator Coffin countered there may be lawsuits filed by students who will graduate from an unaccredited architectural program. Ms. Matteucci said, "We're sympathetic to the issue, but I don't know that the public works board feels comfortable moving one direction or the other without some indication from the court."
Mr. Stephens interjected there might be a legislative solution. Senator Raggio agreed it might be necessary for the legislature to make a special exception through enactment of a statute. He admitted he had not explored that possibility. Mr. Stephens said he had heard a discussion in which the project could be canceled and then another project could be implemented.
Senator Raggio asked if that would necessitate another bidding process. Mr. Stephens responded, "There's no bidding.... The only thing we've done is go through a selection process. We never signed a contract." Mr. Stephens declared if the legislature authorized and financed a new project to build a school of architecture the State Public Works Board could go through a new selection process and make the selection within 3 months.
Mr. Stephens said:
The cloud is over the project that we have from the `91 program because there was a designing competition and that particular project has this cloud because a number of the people who are architects were working for the university. If you had a new project...all of those architects could compete now, the same ones that competed before, because they've all resigned from the faculty...so they no longer have a problem with the ethics law. So now they could all submit proposals to do this job, and we could have a selection procedure go back to the public works board and do all that.
Mr. Stephens said the original selection of an architectural firm by the State Public Works Board had been deemed ineligible by the Commission on Ethics because one architect was a part-time faculty member and another was a full-time faculty member at UNLV.
Senator O'Donnell opined, "Even that may be challengeable." He suggested a resolution could be accomplished if all parties got together. He stated he would be willing to meet on Saturday with all parties involved, including Senators Raggio and Coffin, the senators on the university subcommittee.
Senator Raggio agreed there should be some resolution to the problem. He asked if there was further testimony on S.B. 306. Ms. Matteucci requested that the projects for the cooling tower and roof repair be moved along because of their urgency.
Mr. Stephens stated the present rents being paid by agencies which are scheduled to move into the Fremont School amount to about $331,000 per year, and the agencies scheduled to move into the old library presently pay $144,000 per year in lease costs. He said that is why the State Public Works Board has targeted July 1, 1994. He reiterated if money is appropriated for the design the board can commence work on the projects.
Senator Rawson asked how much rent will be charged against the agencies who go into the Fremont School. Mr. Stephens replied they would pay 60 percent of what they currently pay which means a 40 percent savings to the state of the figures he enumerated earlier. He says the new charge will amount to about 60 cents per square foot while the agencies pay from $1 to $1.10 for their present facilities.
Senator Rawson asked if an analysis had been made including not only the lease charges but also the cost of capital improvements. Mr. Stephens said, "If you figure that we're saving $133,000 a year, which is 40 percent of the $331,000...on the Fremont School, and you divide that by the $2,041,000, that's a 6.6 percent return on your investment for the additional expenditure." He conceded that was a rough estimate which did not take into consideration inflation factors.
Senator Rawson responded, "It sounds like it's over 10 years to recover...to have that wash. So it sounds like it's not necessarily a savings to us." He conceded it would be a savings if the alternative were to leave the Fremont School vacant, but he estimated the costs either way were fairly similar if remodeling costs are included.
Mr. Stephens said he knew of no state use to which the Fremont School could be put without major remodeling. He pointed out it lacks proper electrical systems, heating and air conditioning or fire systems. In response to Senator Rawson's query, Mr. Stephens estimated the Fremont School should be completed and ready for occupancy by July 1, 1994.
There being no further testimony on S.B. 306, Senator Raggio closed the hearing.
Senator Raggio granted a request by Donald J. Mello, Court Administrator, Office of Court Administrator, Supreme Court, to reopen the hearing on Senate Bill 18 in order to correct the record.
In response to an earlier query, Mr. Mello reported the rate the court pays for rent in Clark County is not $1.15 as he indicated earlier but is 85 cents per square foot. He provided the committee with an itemization (Exhibit D) of the appropriations requested for the temporary move as requested earlier in the hearing by Senator Raggio.
Senator Raggio invited a motion on S.B. 18.
SENATOR COFFIN MOVED TO DO PASS S.B. 18.
Noting that there were a couple of options available to the committee, Senator Raggio said the staff had suggested Assembly Bill (A.B.) 536 of the Sixty-sixth Session could be amended to change the reversion date to June 30, 1995.
ASSEMBLY BILL 536
OF THE SIXTY-SIXTH SESSION: Makes appropriation to supreme court of Nevada for temporary relocation of Las Vegas office.
Senator Raggio stated, "That's a little neater because otherwise we have an appropriation outstanding that would have to revert and this would be a new appropriation." He indicated his preference to make that amendment to change the reversion date to June 30, 1995, effective upon passage and approval.
Senator Rawson asked if that was not the same as what was being discussed. Senator Raggio pointed out the appropriation in S.B. 18 was for the same amount as that already passed in A.B. 536 of the Sixty-sixth Session. Senator Coffin concurred with Senator Raggio's suggestion.
SENATOR COFFIN WITHDREW HIS ORIGINAL MOTION AND MOVED TO AMEND AND DO PASS S.B. 18 ACCORDINGLY.
SENATOR CALLISTER SECONDED THE MOTION.
Senator O'Donnell commented:
A county building is a county's responsibility. They were the ones that put the asbestos in the building in the first place, although I understand that asbestos is something that we realized down the road that it was dangerous, but if the Supreme Court is in the county building and they are renting from the county...there is a fiduciary responsibility for the county...to make that building safe for their tenants. If they have a contract with the county, then it's incumbent upon the county to make that building safe for the tenants.
Senator Raggio pointed out the county will pay the expense of the asbestos removal while S.B. 18 will provide funding to relocate the Supreme Court during the removal process. Senator O'Donnell reiterated his belief the county should pay for the move.
Senator Coffin repeated his understanding the county would prefer that the Supreme Court move out permanently. He surmised the state will at least have to pay for the temporary move if the state wants to renew the lease.
Senator O'Donnell argued, "If they didn't want us there, then why are they giving us such a great deal in the rent. There's a supply and demand thing here. If they didn't want us there, they'd increase the rent to a point where it would make it advantageous for the Supreme Court to get out."
Senator Raggio asked Mr. Miles to explain the information in Exhibit D. Mr. Miles responded:
The $15,479 is derived by the difference in the cost of rent in the Bridger Building to what they would have to pay in some leased space, and that estimate is about $10,599 additional plus the cost of moving in and out and the installation of the telephone in and out of about $4,880. Those two sums added together are $15,479.
Senator O'Donnell asked if the county would receive rent during the period when the building is being renovated. Mr. Miles speculated the Supreme Court would have to pay rent to another entity, which is the sum reflected in the analysis in Exhibit D. He said the rent calculated in Exhibit D is in addition to the amount that has already been budgeted for the Bridger Building.
Senator O'Donnell retorted he would stand with his argument that it is the responsibility of the county to pay the relocation expenses for the Supreme Court.
THE MOTION CARRIED. (SENATORS O'DONNELL AND JACOBSEN VOTED NO. SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio asked Senator Coffin to explain S.B. 18 with its amendment on the floor of the Senate. Senator Coffin replied he would be delighted to do so.
Senator Raggio indicated he would entertain a motion on S.B. 21.
SENATOR CALLISTER MOVED TO DO PASS S.B. 21.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio asked for discussion on S.B. 194. There was no further discussion.
SENATOR COFFIN MOVED TO DO PASS S.B. 194.
SENATOR CALLISTER SECONDED THE MOTION.
Senator Rawson declared he had not been present for all the discussions on S.B. 194. He indicated his intention to vote against the measure without further discussion. Senator Raggio went over the provisions of the bill. He explained the bill would accommodate new judges and make a change regarding one judge who had died, but it would not institute a raise. Senator Rawson determined he would then support the measure.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio invited discussion on S.B. 238.
Senator O'Donnell asked for an explanation of the duties of the Commission on Judicial Selection. Senator Raggio explained the commission meets whenever there is a vacancy and recommends three nominees to the Governor. He said the amount requested in the bill is to supplement the anticipated costs of the commission during the present biennium.
Senator Jacobsen wondered how the commission could have a debt of $700. Senator Raggio reiterated the commission meets every time there is a vacancy in the Supreme Court or the district court. He surmised there had not been enough money in the fund to cover costs of meetings, and the remainder requested is in anticipation of further meetings which may be necessary during the biennium.
SENATOR RAWSON MOVED TO DO PASS S.B. 238.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio presented S.B. 264 for action.
SENATOR RAWSON MOVED TO DO PASS S.B. 264.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio invited comment on S.B. 266.
SENATOR O'DONNELL MOVED TO DO PASS S.B. 266.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio called for a motion on S.B. 239 which he stated would correct an error in hazardous materials fees which should go to the state highway fund.
Senator O'Donnell noted the bill was retroactive to July 1991, and he inquired if the fees had been collected since July 1991 or since October 1991. Senator Raggio said the fees had been collected and would be allocated to the highway fund.
SENATOR RAWSON MOVED TO DO PASS S.B. 239.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR GLOMB WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio announced he would prefer to hold the portion of S.B. 306 dealing with the old State Library building. He inquired if Senator Jacobsen would investigate whether it would be feasible for prison crews to install the fencing around the prison at Jean. Senator Jacobsen agreed to attempt to obtain the information before the coming Thursday.
Senator Rawson indicated he did not feel the Fremont School project should be considered an emergency measure. Senator Raggio asked if the committee would like to go ahead with the design on the Fremont School building. Senator Coffin inquired how much the design would cost. Senator Raggio answered it was around $29,000.
Ms. Matteucci concurred the design would cost $29,000. She advised the committee to proceed with the design. Senator Raggio clarified by saying the design for the Fremont School would be $127,000 and the design for the old State Library would be $29,000. He declared, "It's going to be difficult to process it if we take out, for the moment, the fencing. Is there any reason why we can't hold this until Thursday?" Ms. Matteucci said that would be fine but she asked that the bill be moved along after the information sought became available.
Senator Coffin pointed out the weather in southern Nevada is already heating up and the question of the air conditioning should be resolved as soon as possible. Ms. Matteucci repeated she would be amenable to waiting until Thursday.
Senator Raggio noted the fencing around the prison would not be ordinary. Senator Jacobsen stated his information indicated the trench would be 12 inches wide and 18 inches deep. Senator Raggio requested him to obtain the information by Thursday.
Senator Raggio announced subcommittee meetings scheduled for the following day and noted the session would commence at 10:00 a.m. In the absence of further business he adjourned the meeting at 9:30 a.m.
RESPECTFULLY SUBMITTED:
Judy Jacobs,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE:
??
Senate Committee on Finance
March 23, 1993
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