MINUTES OF THE
SENATE COMMITTEE ON FINANCE
Sixty-seventh Session
April 13, 1993
The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:00 a.m., on Tuesday, April 13, 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 Lawrence E. Jacobsen
Senator Bob Coffin
Senator Diana M. Glomb
Senator William R. O'Donnell
Senator Matthew Q. Callister
COMMITTEE MEMBERS ABSENT:
Senator Raymond D. Rawson, Vice Chairman (Excused)
STAFF MEMBERS PRESENT:
Daniel G. Miles, Fiscal Analyst
Robert Guernsey, Principal Deputy Fiscal Analyst
Judy Jacobs, Committee Secretary
OTHERS PRESENT:
Terry R. Crawforth, Deputy Director, Department of Wildlife
Judy Matteucci, Director, Department of Administration
Senator Raggio read amendment number 247 to Senate Bill 276 which had been amended and passed on April 2, 1993.
SENATE BILL 276: Authorizes transfer of money from offenders' store fund to prisoners' personal property fund.
The amendment provided for the insertion of the words "after obtaining the approval of the interim finance committee" following the word "may" on line 18. The committee concurred the amendment was correct according to their previous vote.
Senator Raggio proceeded to the items on the agenda.
SENATE BILL 195: Revises fees relating to numbering and ownership of motorboats.
Terry R. Crawforth, Deputy Director, Department of Wildlife, presented information on Senate Bill 195 (S.B. 195) which had been requested by his department. He explained the bill would increase fees for motorboat titles from $5 to $15. He said the former fee had been in existence for many years, and it no longer is adequate to cover the costs of establishing title.
Mr. Crawforth declared approximately 4,600 boat titles are issued in the state each year. He estimated the time to issue a title is about 20 minutes, which includes physically measuring the boat and inspecting the serial number. Registrations are tracked by computer. He indicated the actual cost is about $15 for personnel time and computer costs.
Mr. Crawforth said the title fee is a one-time event for each boat registration. He calculated annual income from such fees at $46,000.
Mr. Crawforth explained the fee to be charged for lost decals would be established by law at $10. He said the fee was customary, but it had not been set in the statutes, so the auditors had suggested the addition to S.B. 195.
Mr. Crawforth said the change to subsection 6 would raise the dealer demonstration number fee from $7.50 to $15. It would be charged only to manufacturers or dealers. He described the dealer demonstration numbers as similar to vehicle dealer plates on motor vehicles. He stated the $15 fee would be in keeping with the annual fee to register a small motorboat. He said normally 123 dealer numbers are issued annually. He explained some dealers purchase more than one dealer number in order to demonstrate more than one boat at a time.
In response to a query by Senator Raggio, Mr. Crawforth admitted there have been some rare occasions in which the numbers have been misused, but they have been very few. He said boat usage is investigated when it appears it is being used for something other than a demonstration. He conceded the additional dealer number fees would bring in only about $1,000.
Mr. Crawforth said the new language to be added to section 2 was designed to clarify those provisions in order to bring them into conformity with the provisions of section 1, subsection 3. Those provisions would require annual fee renewals based upon the fees set out on the first page of S.B. 195.
Mr. Crawforth requested a change in the last section of the bill, section 3. He asked that the effective date of the bill be January 1, 1994, rather than July 1, 1993, because the boat registration and title fees also become due on the first of the year.
Senator Raggio asked how large boats, which are often observed on Lake Tahoe and Lake Mead, are licensed. Mr. Crawforth replied those boats are referred to as documented boats, and the documentation is obtained through the United States Coast Guard. The documentation is related to their use on navigable waters, he said. The state receives no fees from documented boats.
Senator Raggio asked if the administration supported S.B. 195. Judy Matteucci, Director, Department of Administration, nodded her agreement. There being no further discussion on the matter, Senator Raggio closed the hearing on S.B. 195.
SENATE BILL 239: Increases amount that person who awards certificate of number for watercraft may retain from fee paid for certificate.
Mr. Crawforth described the purpose of S.B.239. He said those who issue hunting and fishing licenses have been receiving a commission of 50 cents for each license. Many of those people also issue boat registrations, and the purpose of the bill is to raise the commission the agents receive from 25 cents to 50 cents for each boat license issued.
Mr. Crawforth acknowledged the fiscal impact of the bill will amount to approximately $320. Senator Raggio pointed out the cost to process the bill may be nearly double the impact. Mr. Crawforth concurred, but said those who issue the licenses requested the raise in order to cover their costs of processing boat licenses.
Senator Raggio declared he owns a boat. He inquired if he might have a conflict. Mr. Crawforth opined the senator probably did not have a conflict.
Mr. Crawforth requested a change of the effective date on S.B. 239 from July 1, 1993, to January 1, 1994.
Mrs. Matteucci said the administration concurred with the Department of Wildlife in support of S.B. 239.
In the absence of further testimony, Senator Raggio closed the hearing on S.B. 239. After a short recess, he called for action on the two bills.
Senator O'Donnell remarked the increase from 25 cents to 50 cents in S.B. 239 would give incentive to those who register boats to continue to register them.
SENATOR O'DONNELL MOVED TO AMEND AND DO PASS S.B. 239 BY CHANGING THE DATE OF EFFECTIVENESS TO JANUARY 1, 1994.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
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Senator Raggio called for a motion on S.B. 195. Senator Glomb requested further clarification. Senator Raggio repeated the provisions of the measure and explained the raises were being suggested to cover rising costs to the state.
SENATOR O'DONNELL MOVED TO AMEND AND DO PASS S.B. 195 BY CHANGING THE DATE OF EFFECTIVENESS TO JANUARY 1, 1994.
SENATOR JACOBSEN SECONDED THE MOTION.
Senator Glomb inquired if the additional fees to be obtained would go into the General Fund to be used only for the Department of Wildlife. Senator Raggio read the provision of the chapter in the Nevada Revised Statutes which declared that all fees received by the department must be deposited in the wildlife account and be expended only for the administration and enforcement of the provisions of the chapter.
Senator Glomb asked if a portion would be distributed to the schools. Ms. Matteucci responded:
No, all the money for fees go into the wildlife account. It's lodged in the General Fund, but they are all solely dedicated to the wildlife account. None of this goes into the General Fund as you think of it, the regular revenue piece of the General Fund from which we make appropriations. ...This funding is specifically earmarked only for the wildlife account.
Senator Raggio remarked no General Fund money had been put into the wildlife account, but fees in recent years have not generated enough revenue to support wildlife. Thus supplemental funds have had to go into the Department of Wildlife.
Senator Glomb asked, "What's the 50 percent of each fee for the county school district?" She pointed out the provision on line 6 of page 2 of S.B. 195. Senator Raggio said, "That portion of it is the same as the motor vehicle privilege tax...." He explained the fees which go to the schools are only those attributable to the fees imposed on the length of the boat. Ms. Matteucci interjected those fees are not being changed by the bill.
Senator Coffin asked if any other legislation was being prepared which would increase fees on boats. Nobody expressed knowledge of any bills that would increase boat fees.
Senator Glomb suggested several counties would not receive fees because they would not be in a position to register boats. She asked if that was offset by other revenues. Senator Raggio responded it is likely every county registers boats, even though people may be forced to travel to other counties to use them. Ms. Matteucci explained it is the same as the receipts every county gets from the privilege tax on car registrations.
Senator Raggio called for the vote on the motion before the committee.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Jacobsen commented on a discussion that took place the previous day regarding repairs to leaking roofs. He reported he had found an inventory of equipment stored at the Stewart Indian School which could be used for such projects. He stated he would like to return to the committee with an estimate of roof repair work which could be done by honor camp crews. He said, "The reason it folded up before was because it was under the Department of Prisons. I'd like to put it back under NDF [Nevada Division of Forestry] where they could accommodate state buildings wherever...the need might be."
Senator Jacobsen declared it was not his intention to involve honor camp crews in a full roofing business, but rather to use them for patching roofs. He estimated there is repair work that will take about two weeks at Stewart Indian School, a week at a 4-H camp, and perhaps two weeks at the University farm. He described them all as small jobs.
Ms. Matteucci responded there had been a problem when the honor camp work program had been run through the Buildings and Grounds Division. She explained, "They hired contractors that were supposed to supervise the inmates.... There was an attorney general's opinion that they could not do that with contractors." She added they had encountered difficulty in keeping the crews filled and getting the work done properly.
There was general agreement the matter should be investigated further. Ms. Matteucci promised to provide more information on the ruling by the attorney general on previous use of inmates for construction work. Senator Jacobsen stated he had requested a count of the number of roofers which would be available from the inmate population. Senator Raggio described the work performed by inmates he had observed while on a tour of prison facilities.
Senator Raggio shifted attention to closing budgets. He reminded the committee budgets would be closed with the understanding they may be reopened as a result of final decisions on the proposed reorganization of the government by the Governor.
Senator Coffin asked if it would be proper to make some assumptions about the reorganization as budgets were closed. Senator Raggio replied he did not feel it would be prudent to preclude the committee from making later adjustments. He suggested it would be unwise to await decisions on the budget until after the final action on the reorganization. Senator Coffin said:
My only problem is we have understandings we've been given based on the hearings we've had on these budgets and sometimes the understandings we were given may not jibe with the way the bill is written.
Senator Raggio averred conditions could be put on any budgets discussed as each is discussed. He indicated the budgets would not have to be closed but suggested some action be taken because the committee will have to meet with the Assembly Committee on Ways and Means on the budgets according to the rules.
Senator Callister asked, "As we go through these budgets is there a possibility that the staff could...make certain that we don't gloss over one in which we are approving a `value of' as opposed to the actual removal of the position." Senator Raggio replied he had already asked the staff to do that and that they had prepared some commentary to accompany each of the budgets.
Clear Creek Youth Center - Page 300
Senator Raggio acknowledged the committee had not visited the site, but declared there should be ample information available to vote on the budget.
SENATOR COFFIN MOVED TO APPROVE THE BUDGET FOR CLEAR CREEK YOUTH CENTER AS RECOMMENDED BY THE GOVERNOR.
SENATOR CALLISTER SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
High School Rodeo - Page 573
SENATOR COFFIN MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Nevada Junior Livestock Show Board - Page 578
Senator Glomb inquired how indigent children get involved in projects such as the livestock show. Ms. Matteucci responded such programs are open to any child, that there is no eligibility criteria. She said most animals are available at inexpensive rates or may be provided by supporters. She admitted it would be difficult for some children to house larger animals such as cows. She said the FFA [Future Farmers of America] is run through the auspices of the schools.
Addressing Senator Glomb, Senator Jacobsen said a lot of tears are shed over the program when animals are sold because the children become attached to them. He endorsed the concept as a valuable lesson in "growing up" and in the merits of competition.
Senator Raggio pointed out a suggestion had been made to add $560 in each year to the Governor's budget recommendation because salaries for board members were insufficient.
SENATOR O'DONNELL MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Taxicab Authority - Page 584
Senator Coffin wanted to know if the budget would be affected by the proposed reorganization. Ms. Matteucci indicated the budget would move into the Department of Business and Industry. She said, "Other than the executive director of that department making the appointment of the head of the taxicab authority there would be no changes."
Senator Coffin asked if there would "be any separation between the regulatory personnel and the agency and the enforcement personnel and the agency." Ms. Matteucci replied there would not. She said, "That was...a recommendation...originally made...by the consultants. I'm not even sure that the commission on reorganization accepted that particular proposal.... There is no recommendation for splitting those."
Senator Raggio inquired if there had been adjustments to revenue. Dan Miles, Fiscal Analyst, explained the agency had indicated to the Senate Committee on Finance their revenues were slightly higher than what had been set in the budget. He said the agency projected a higher number of trips and airport fees than projected by the Governor's budget, and the airport fees would be used for overtime pay at the airport.
Senator Raggio asked if fees were going to be raised for the Senioride program. Mr. Miles replied they were not going to be raised, the only increase was in the anticipated number of riders.
Senator Raggio pointed out the committee had the choice of adjusting the budget by adjusting the projected revenues in accordance with those projected by the Taxicab Authority and then adjusting the expenses accordingly.
SENATOR COFFIN MOVED TO ADJUST THE BUDGET IN ACCORDANCE WITH THE AGENCY'S REVENUE AND EXPENSE ENHANCEMENTS.
SENATOR O'DONNELL SECONDED THE MOTION.
SENATOR RAGGIO RESTATED THE MOTION TO AMEND, ADJUSTING FOR REVENUE IN THE TOTAL AMOUNT OF $65,616 IN FISCAL YEAR 1994 AND $67,456 IN FISCAL YEAR 1995, WITH ACCOMPANYING ADJUSTMENTS TO EXPENDITURES.
Senator Glomb asked where the increases each year would appear. Senator Raggio responded those increases would appear in the revenue category. Mr. Miles told her it would appear under Budget Summary, Other on page 586 of the Governor's Executive Budget. He explained the Governor projected sources of revenue would be increased.
Ms. Matteucci stated, "It appears to me...that...increased operating for increased trips would be a maintenance item under--and they don't have any under Demographics." She said the remainder would go under Maintenance.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Carey Act - State Lands - Page 1568
Mr. Miles pointed out the technical adjustments. He said, "The balance forward in `95 didn't agree with the reserve in `94." Under expenditures he noted the rent coding had been changed because the office was not occupying state-owned space as had been indicated.
SENATOR GLOMB MOVED TO ADJUST ACCORDING TO RECOMMENDATIONS MADE BY THE STAFF.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Marlette Lake - Page 1597
Carson Water Treatment Plant - Page 1600
Senator Jacobsen requested that the budgets for both Marlette Lake and the Carson Water Treatment Plant be held pending negotiations on a new water contract. Senator Raggio agreed to do so.
Heil Wild Horse Bequest - Page 1616
Mr. Miles again called attention to technical adjustments suggested by staff. He noted In-State Travel had been coded to Out-of-State Travel and it should be reversed. The only other change was an adjustment in Vacancy Savings at $137, which he recommended be eliminated.
SENATOR O'DONNELL MOVED TO ADJUST THE BUDGET ACCORDING TO STAFF RECOMMENDATIONS.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Nevada Natural Heritage - Page 1629
Mr. Miles described an adjustment to expenditures which would reduce reserve for software which had been requested at a cost of $250. He explained, "These are not general funds." Senator Raggio repeated, "The adjustment would reduce the reserve for the added software and adjust the balance forward in the amount of $957."
Senator Glomb asked how the budget would be affected by the proposed reorganization. Mr. Miles replied the budget itself would not be affected by reorganization, although the organization would be transferred to the new Division of Wildlife and Parks. He stated there had been some question as to whether Nevada Natural Heritage would report directly to the department director or would become a portion of the Wildlife and Parks.
SENATOR GLOMB MOVED TO ADJUST THE BUDGET ACCORDING TO THE RECOMMENDATION OF STAFF.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Mining Cooperative Fund - Page 1633
Senator Raggio pointed out a new budget page had been produced for the Mining Cooperative Fund in the Executive Budget book. He inquired what changes had been included. Mr. Miles responded, "It spread the operating expenses into operating and carryforward."
Senator Glomb inquired if any general funds were included in the budget. Senator Raggio replied there were not, but it would include transfers from the Department of Minerals in lieu of general funds.
Senator Coffin recalled earlier testimony that funds would be lost from the budget which had been used for mapping remote regions that are not mapped by the United States Geological Survey (USGS). Ms. Matteucci responded the suggestion had probably been that more mapping could be done if the Mining Cooperative Fund received monies from the General Fund. She directed attention to the $128,000 under General Fund in the Base for fiscal years 1992 and 1993 which is not carried forward in the Governor's recommendations for succeeding years.
Senator Raggio asked what the source of the Division of Environmental Protection funds was that were going into the Mining Cooperative Fund. Ms. Matteucci responded those funds came from a fee that was instituted by the 1991 session of the legislature which was to be split between the two agencies. She said, "It didn't show up as much as they thought originally but...they've made the adjustments now, and I believe that the revenue estimates now are going to be realized as a result of the adjustments that they've made."
Mr. Miles concurred with Ms. Matteucci's recollection.
Senator Coffin said the budget had caught his attention because "it's usually the last, best hope for the prospectors to find new minerals because the USGS does not cover the whole area." He asked that the budget be held. Senator Raggio agreed to hold the budget until Senator Coffin has an opportunity to obtain more information and report back to the committee on his findings.
Ms. Matteucci explained, "This budget does do the mapping in cooperation with USGS." Senator Coffin worried that the USGS does not map the entire state and the unmapped areas are left to the Mining Cooperative Fund. Being unsure, Ms. Matteucci agreed that should be investigated.
Senator Raggio called for a recess. When the meeting resumed Senator Coffin questioned Ms. Matteucci. He said:
Since we first saw the figures on your assumptions for the increase necessary to fund the employees' group health insurance plan...I've been worried about the size of that, whether it was large enough. Now that we're closing, and each one of these Maintenance categories...has that built in, can you tell me again what the percentage increase is...?
He cited a projected increase from $203 per month to $213 per month per employee for the first year followed by an increase to $226.50 in the second year.
Ms. Matteucci responded:
It's about a 6 percent increase in the second year of the biennium. We're currently at $213.75, so we're recommending no increase in the state's contribution for the first year of the biennium. That is due to an actuarial study that was completed in the fall of 1992 that indicated that, and I believe, Senator Coffin, this was one of the questions you had last biennium as to what the costs were for employees relative to what the costs were for employees plus dependents. And we've found that...both the employee and the employee plus one...was apparently subsidizing heavily the families. So the rate structure has been changed from a three-tier rating structure to a four-tier rating structure and we're...moving over the next 3 or 4 years to full actuarial funding for each one of those particular sections.... Because the employees' contribution has essentially been subsidizing the dependents, you don't see it moving as much as the dependents rates are going to have to move as we go across time to catch up with what they really are costing us.
Senator Coffin estimated the trend at about 18 percent for many companies. Ms. Matteucci calculated the trend at between 12 and 18 percent, with a medical inflation component of approximately 6 percent. She offered to provide a copy of the actuarial study to Senator Coffin.
Senator Coffin worried funding would not be sufficient. He supposed the budgets could be adjusted at the end of session if there was a strong consensus a mistake had been made and if one singular adjustment could change all budgets. Ms. Matteucci concurred that might be possible if the legislature desired to increase the state payments to the insurance fund. She suggested it would be very expensive due to the number of employees, approximately 13,000.
Senator Coffin declared the employees had become very upset last year when they had been informed the insurance program had been underfunded. He asked if Ms. Matteucci could provide the actuarial loss ratios per class for the four-tier class to which she had referred. Ms. Matteucci responded, "Some of the loss ratios are in the budget as performance indicators." She repeated her offer to provide the senator with the loss ratios and actuarial study.
Senator Raggio stated he had two bill draft requests (BDRs) for the committee to consider. He indicated he would set the bills for an early hearing.
BILL DRAFT REQUEST S-1946: Specifies amount to be paid by certain public employers for group insurance for public employees for next biennium.
Senator Raggio said BDR S-1946 had been requested by the administration. He described it as the bill to provide group insurance for public employees for the next biennium.
SENATOR COFFIN MOVED FOR COMMITTEE INTRODUCTION OF BDR S-1946.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
BILL DRAFT REQUEST S-1947: Specifies amount payable by state for group insurance for retired public employees.
SENATOR O'DONNELL MOVED FOR COMMITTEE INTRODUCTION OF BDR S-1947.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio asserted any changes brought about from new bills affecting budgets would be added when necessary. He continued the review of the budgets.
Washington Office - Page 8
There were no change recommendations from staff. Senator Raggio inquired why salary increases were being recommended for the Washington Office when other state employees were not receiving raises. Ms. Matteucci responded, "The Washington Office is a contract, and what we essentially do is give him a flat amount and he distributes it...as he sees fit."
Ms. Matteucci indicated she was unaware of any discussions with the director of the Washington Office as to whether he would be willing to forego a salary increase. She added, "There are some recommended contractual increases that are in the budget for certain providers, so...in certain cases we have not done that." She pointed out the cost of living in Washington is significantly higher than in Nevada.
Senator Glomb asked if the Washington Office budget was funded through agency transfers. Ms. Matteucci responded some funding comes from the Divisions of Economic Development and Tourism and the Department of Transportation. She said the director of the Washington Office is the primary representative of those three agencies and they are the only offices that are assessed.
Senator Coffin estimated the pay raise at approximately 2 percent, which he called insignificant.
SENATOR COFFIN MOVED TO CLOSE THE BUDGET ACCORDING TO THE GOVERNOR'S RECOMMENDATION.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Municipal Bond Bank Revenue - Page 70
SENATOR COFFIN MOVED TO CLOSE THE BUDGET ACCORDING TO THE GOVERNOR'S RECOMMENDATION.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Municipal Bond Bank Debt Services - Page 73
SENATOR COFFIN MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE GOVERNOR'S RECOMMENDATION.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Judicial Discipline - Page 109
Senator O'Donnell recalled there had been requests by the Commission on Judicial Discipline first for a FAX (facsimile) machine and then for a computer system. Senator Raggio pointed out the request had been for $5,000 for office furniture as well as the machines. Senator O'Donnell declared the requested sum would "make the office ten times more functional...for just half-again as much money."
SENATOR O'DONNELL MOVED TO ADJUST THE BUDGET BY ADDING THE $5,000 REQUESTED FOR NEW EQUIPMENT.
Senator Raggio asked if the expenditures of $10,570 set forth in the Base budget included the costs for the attorney general. Mr. Miles replied it did include $5,000 for the attorney general. He confirmed the request for an additional $5,000 would be a one-time expenditure.
Senator Raggio asked if the $5,000 was adequate for their request. Senator O'Donnell replied that it was adequate as evidenced by bids from two different computer shops. He stated he could not bid because he would have a conflict of interest if he did so.
SENATOR CALLISTER SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Supplemental Fund - Indigents - Page 201
Senator Glomb asked, "We pay 40 cents on the dollar back to the county for indigent care?" Senator Raggio interjected, "At 150 cases? Senator Coffin said, "No...for each one dollar...we pay 40 cents." Senator Glomb continued, "According to this on page 202 it's to reimburse Nevada counties. Senator Raggio explained those applied to unpaid hospital charges.
Senator Glomb inquired as to the source of the funds. Mr. Miles replied the funds came from a 1 cent property tax which flows into the fund. He explained once a county has expended 90 percent of their indigent fund it can apply to the state Supplemental Fund - Indigent for reimbursement for up to $25,000 per case. Senator Raggio noted the reimbursements are limited to the amount available in the fund.
SENATOR O'DONNELL MOVED TO ACCEPT THE BUDGET ACCORDING TO THE GOVERNOR'S RECOMMENDATION.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Indigent Accident Account - Page 203
SENATOR COFFIN MOVED TO ACCEPT THE BUDGET ACCORDING TO THE GOVERNOR'S RECOMMENDATION.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
State Printing Office - Page 214
Printing Office Equipment Purchase - 218
Senator Jacobsen requested the State Printing Office budget and the Printing Office Equipment Purchase budget be held. Senator Raggio agreed to hold both budgets.
Records Management - Micrographic - Page 220
Senator Raggio pointed out the budget also applied to printing and asked if Senator Jacobson would like it to be held. Senator Jacobsen agreed that it should be held. He said he would be able to report back to the committee on the three budgets on the following day.
Mail Services - Page 224
Senator O'Donnell asked to what the State Cost Recovery Plan in the amount of $51,738 referred. Ms. Matteucci replied:
In order to continue to receive federal funds [the state] has to prepare a cost-allocation plan that demonstrates to the federal government that although the various costs that the federal agencies are being charged are the same as what we're charging, either other General Fund agencies or not. In addition to that there are certain General Fund functions, like the treasurer's office, controller's office, the budget office...that we can recover the federal or non-General Fund portion from.
Ms. Matteucci stated she had prepared a cost-allocation plan and the Mail Services budget would include its share. When asked if the Mail Service could be done for any less, Ms. Matteucci replied it could not, because it is based upon the time and number of vouchers from each agency. She said it includes recovering the cost attributable to the legislative auditor and library services which are derived from the General Fund. She declared, "Once the plan is set...and approved by the federal government...we have to charge equally or we could be in violation of the cost-allocation plan." She said the money goes back into the General Fund as a revenue item.
Senator O'Donnell noted Postage expenditures were projected to increase by $185,000. He asked why the increase was necessary. Ms. Matteucci replied it anticipates a 10 percent increase in volume based upon demographics. Mr. Miles called attention to the Postage under the Base which amounts to nearly $2.5 million per year. He explained all state mail is included in the budget.
Senator Raggio reiterated the $185,000 on page 225 reflected the estimated increase of approximately 10 percent in volume. Ms. Matteucci argued the expenditure will not be made if there is no increase in volume. She explained it is an internal service fund which charges according to the volume.
SENATOR O'DONNELL MOVED TO ADOPT THE GOVERNOR'S RECOMMENDATION.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Motor Pool - Page 228
Mr. Miles reported the accounting positions for the State Motor Pool under the reorganization plan would move to the Department of Administration budget. Regarding a question of policy he explained:
In the past...when we've had public works projects for non-General Fund agencies the legislature sometimes has had those agencies pay those costs. In this particular case in 1991 the legislature appropriated funds for advance planning to the [State] Public Works Board and they spent $1,020 for...advance planning on behalf of the motor pool. The policy question is, do you want the motor pool to reimburse the General Fund for those costs.
Senator Raggio asked if a requirement to reimburse the General Fund would be consistent with previous actions. Mr. Miles replied the state has required repayments to the General Fund when the state has billed an agency. Senator Raggio declared there should be consistency even though the amount under question was not significant. Mr. Miles reported the same question will come up in other budgets before the committee.
Senator Glomb asked if the reimbursement reflected a change in policy. Senator Raggio conjectured the policy went back to the 1960s or 1970s. He explained some funds had been advanced on behalf of the State Motor Pool in 1991 under the Capital Improvements bill.
Ms. Matteucci interjected there had been a lump sum appropriation for advance planning. She said, "Whenever we've built buildings...in the past out of General Funds for these internal service funds, you have always established a payback for them." She pointed out the question was whether or not the committee wanted to continue to assess for advance planning expenditures even though the item in question was a small amount.
Senator Raggio repeated his opinion there should be consistency. Ms. Matteucci said:
In some agencies..they are non-General Fund.... We've got, I think...a difference of opinion perhaps with your staff on whether or not you want to assess paybacks to buildings and grounds, `cause all that does is drive the rent up, and those are big amounts, and that has not been applied consistently, I don't think. So with that we'll get on the record just saying that, but other than, if you want to pay back on that advance planning for anything done for non-General Fund purposes we can do that. We can also...put it in the cost-allocation plan and recover that way, but it makes no difference at this point as long as we are consistent. That is important.
Senator O'Donnell pointed out there is some control now over who is renting cars, which he asserted is how the system works in essence. He alleged control is lost when cost-allocation is used. He charged, "The motor pool, instead of being a little bit more cognizant of who they're allowing these cars to go out to, and how long they're going to be out, because essentially they're going to have to cover their budget, that will now be reallocated back and billed out to the agency that's going to pay it." He opined cost-allocation is more inefficient than having the motor pool directly control their own budget.
Senator Raggio compared the situation to that of an agency that is federally funded. He said, "You want to make sure you get your total cost, and...you have to do the same with a General Fund agency...to justify it." Ms. Matteucci stated the cost would be the same to a federal agency as it would be to a General Fund agency. She explained the purpose was to recover the General Fund cost through the cost-allocation method.
Senator Coffin said he had inquired about cellular telephones the motor pool expressed a desire to purchase during the hearing on their budget. He averred there had been an associated operating expense item for both years. He wanted to know if they had responded to his inquiry as to whether they could also use radios to reduce costs as opposed to cellular telephones and how personal use could be restricted.
Senator O'Donnell recalled they had testified the cellular telephone company provided the motor pool with a list of all numbers called which was studied to ensure there were no personal calls. Senator Coffin felt it would be impossible to keep the price low. He said they had indicated they would have only two cellular telephones at a cost of $800 per year. He reiterated his question on the price of two-way radios which he conjectured would provide communication at a lower cost.
Ms. Matteucci contended the reason the motor pool may prefer cellular telephones could be attributed to the fact they do not employ a dispatcher, while a state employee wanting to contact the motor pool could do so readily with cellular telephone capability. She cited her experiences in Las Vegas in which she needed transportation to or from the airport as examples of when the cellular telephone was useful.
Senator Raggio stated the motor pool had indicated a need for communications with the shuttle bus and with the shop truck. Ms. Matteucci repeated her examples and said a radio would not have helped her situation. Senator Raggio said he would hold the budget for consideration after more information was forthcoming from the motor pool.
Motor Pool Vehicle Purchase - Page 234
Senator Raggio recalled the motor pool planned to replace 29 vehicles in the first year of the biennium and 56 in the second year. The budget would also include purchase of a number of alternative fuel vehicles.
SENATOR GLOMB MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
State Unemployment Compensation Fund - Page 262
SENATOR O'DONNELL MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Callister requested that most of the budgets be discussed in concept only and that no final closing action be taken until Thursday or Friday.
Senior Citizens Property Tax Assistance - Page 212
SENATOR O'DONNELL MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR GLOMB SECONDED THE MOTION.
Noting that many senior citizens are eligible to receive assistance from the account, Senator Glomb asked what problems had been voiced at the hearing on the budget as expressed by Orland T. Outland, who spoke on behalf of the Nevada Council of Senior Citizens.
Ms. Matteucci said Mr. Outland had wanted funding for $745,000 in the first year and $1 million in the second year as provided under Demographics on page 212 of the account. She declared, "Up until the last two years this program was fairly flat, and word about it has...been dispersed, as it probably should, and there has just been a demand that exceeds the money that's available in the particular account."
Senator Glomb asked if a means test was done to determine eligibility. Ms. Matteucci replied there is a means test, but there have been insufficient funds to provide 100 percent of that which citizens are entitled to if the account were fully funded. She affirmed it would require $1.7 million over the biennium to fully fund the program.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Public Service Commission Regulatory Fund - Page 331
Senator Raggio stated Senator Leonard V. Nevin has introduced a bill regarding performance audits which may or may not have some bearing on the budget. He apprised the staff of his intention to bring the bill before the committee.
Mr. Miles explained part of the recommendation of the Governor's budget was to use some of the $97,000 from the administrative fines account to offset costs associated with hearings on administrative citations before the Public Service Commission (PSC). He pointed out the figures were depicted on page 337 under Enhancement.
Senator Coffin noted a request for an adjustment had been made by John F. Mendoza, Chairman of the PSC, having to do with position transfers. Mr. Miles responded that request had come from the budget office because the initial budget had failed to include the PSC in the reorganization of the Department of Data Processing. He said, "Subsequent to that the Department of Data Processing was recommending that this one be included...for transfer of two data processing positions over to the department...."
Ms. Matteucci explained, "The one that's before you now did not include it because, when we did our search and scan, the positions that PSC is using for data processing did not have the correct class code for us to pick them up. It was always our intention to include PSC."
Senator Coffin recalled the discussion had been that the committee did not want to accept the proposed change. Senator O'Donnell concurred but added there had been some confusion over what really might be required. He stated the department head of data
processing was working closely with the budget office to devise a new plan which has not been presented to the committee yet.
Ms. Matteucci agreed that it might be well to wait for the plan before taking action on the budget. She elaborated, "Essentially, on the coordination...and consolidation of data processing you go through and you not include everyone then that seriously impacts what we're proposing to do in the consolidation and this is one of them."
The members of the committee decided to hold both the PSC budget and the Public Service Commission--Admin Fines budget until a later date.
Museums, Library and Arts Administration - Page 1182
Mr. Miles recommended hearing the Museums, Library and Arts Administration budget because it provides for administration. He added it includes the new science advisory position under Enhancement.
Senator Raggio reminded the committee there is a bill which has been heard but on which no action has been taken which would move the science advisor to the Division of Economic Development. He announced no action would be taken on the budgets falling under the Department of Museums, Library and Arts.
Senator Callister tried to recall how many positions would be eliminated within the total department reorganization. None present were able to give him the exact figure.
Senator Coffin agreed it would be wise to hold the budgets. He suggested all those budgets that may be moved into the department should be heard and closed at the same time in order to make the reorganization more successful.
Senator O'Donnell asked if all the budgets would be moved at one time. Senator Raggio replied, "Not necessarily."
Colorado River Commission - Page 1491
Mr. Miles commented some of the line items on the budget were not displayed correctly but there was nothing that would change the budget.
Senator O'Donnell noted $150,000 had been removed from Operating Expenses but $179,000 had been included under Attorney General for two full-time deputies. He inquired why that had been done. Ms. Matteucci responded:
The federal government helps this account for expenditures of federal dollars as well as non-federal dollars. When the cost-allocation plan was being reviewed this last time, the federal government said you cannot continue to fund the attorney general's office in the State of Nevada as you have been, which was partially through a General Fund appropriation and partially through salary reimbursements from all the various using agencies. You have to either get it all in the General Fund and cost-allocate out the other part...or you can fund the General Fund portion directly to the attorney general and then do the cost-allocation to the non-General Fund, which is the way that we chose to do it. In doing that then that becomes another cost-allocation transfer and not just a specific transfer of funds for the salaries of specific deputy attorney generals. We do believe we're now in compliance with what the federal government wants us to do, but it caused us to move that out of there and move it down into the attorney general cost-recovery.
Senator Raggio called attention to the amounts for bankruptcy on page 1493. He asked for an explanation. Ms. Matteucci responded:
This was the group that...was going to take care of some lands through the Fort Mohave program and...they ended up in bankruptcy.... I think they went into extensive conversation with the committee about--once they got out of bankruptcy--what they were going to do with some of those lands.
SENATOR COFFIN MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
CRC Federal Pumping and Transmission Facilities - Page 1497
SENATOR COFFIN MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR CALLISTER SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
CRC Research and Development - Page 1499
Mr. Miles noted the agency had requested additional authority to retain expert consultants to aid the commission's effort to acquire the Hoover electrical power transmission lines from WAPA (Western Area Power Administration). He said the customers have agreed to a .0001 kilowatt per hour additional charge, which would be a surcharge of $150,000 per year.
SENATOR COFFIN MOVED TO AMEND BASED UPON THE REQUEST BY THE AGENCY.
SENATOR GLOMB SECONDED THE MOTION.
Senator Glomb asked why the budget Resources dropped from $629,000 in 1992-93 to $215,000 in 1994-95 as depicted on page 1499. Senator O'Donnell presented his understanding that the budget would allow the entities to develop a plan for high-tension wires to carry more power to the Las Vegas area. He explained:
...this budget really...is the beginning of a transmission system, a network system statewide, and in doing so...this is the beginning of the budget item that will allow the power companies to charge a higher rate to recoup the cost of capitalization. So somewhere down the road these costs along with costs of the transmissions--all the capital involved will be part of the rate base, and that will be an increase in electrical rates.
Senator Raggio averred from past understandings on such budgets that the costs may actually have very little to do with research and development. As an example he said only $13,000 was spent in 1992. He pointed out the budget at hand was merely an authorization in the event the state decided to go forth with the acquisition of the power network.
Senator O'Donnell declared eventually there should be a cost savings. He concluded the network was being put together in order to effect a cost savings to the ratepayer. He called it a "short-term cost for a long-term fix."
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Power Marketing Fund - Page 1501
SENATOR COFFIN MOVED TO ADOPT THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Fort Mohave Development Fund - Page 1503
Mr. Miles commented the $120,000 Enhancement during the first biennium would be applied to resolution of the Orion bankruptcy case.
SENATOR O'DONNELL MOVE TO ADOPT THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR COFFIN SECONDED THE MOTION.
Senator Callister requested an explanation as to why the legislature would provide $200,000 as an Enhancement for anticipated staff support for a bankruptcy case. Ms. Matteucci replied:
I think the company that bought the land filed bankruptcy, and so we've apparently re-inherited that land and now we have to get it all straightened out so that they can go back and sell it.... I don't know what the consultants are doing. I do know that there's a work program to even begin this consultant work now that's coming over to you...today.
Senator Raggio interjected the land-fill contracts will have to be redone. Senator Coffin declared, "It's going to work to our advantage because we're going to get land back that we practically gave away, and then we're going to be able to sell it."
Senator Callister reiterated he could not understand why $120,000 would be spent in fiscal year 1994 and another $83,000 in fiscal year 1995. Senator Coffin repeated the resources would come from land sales, not from general funds. Senator Callister declared, "It is still a substantial bankruptcy counsel fee. It might be justifiable, but it's also surprising to me that somebody could estimate it." He compared the state's position to that of a creditor taking a secured position.
Senator Raggio asked if Orion was the company that bought the land originally. Senator Callister asked if the attorney general's office had supported the measure. Ms. Matteucci responded she did not recall that the attorney general's office appeared in support of the budget measure. There was some inconclusive discussion as to who had appeared in support. Committee members declared they would like to defer action on the budget for the time being. The motion was withdrawn and Senator Raggio announced he would hold the budget.
Alfred Merritt Smith Water Treatment Facility - page 1505
SENATOR COFFIN MOVED TO ADOPT THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio announced the subcommittees scheduled to meet on the following day. He advised the committee they would consider closing more budgets on Thursday morning and there would be an amendment for the revenue projection bill, Senate Bill 23, for their consideration. He requested members of the committee to review the amendment prior to the discussion.
Senate Bill 23: Establishes two-tiered system of forecasting future state revenues to assist in providing balanced state budget.
There being no further business before the committee, Senator Raggio adjourned the meeting at 10:25 a.m.
RESPECTFULLY SUBMITTED:
Judy Jacobs,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE:
??
Senate Committee on Finance
April 13, 1993
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