MINUTES OF THE
SENATE COMMITTEE ON FINANCE
Sixty-seventh Session
May 27, 1993
The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:10 a.m., on Thursday, May 27, 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 Diana M. Glomb
Senator William R. O'Donnell
Senator Matthew Q. Callister
STAFF MEMBERS PRESENT:
Dan Miles, Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Larry Peri, Program Analyst
Dee Crawford, Committee Secretary
OTHERS PRESENT:
John Crossley, Director, Legislative Counsel Bureau
Frankie Sue Del Papa, Attorney General, Office of the Attorney General
Charles Gardner, Deputy Attorney General, Office of the Attorney General
Judith Allan-Rodriguez, Administrative Director, Crime Prevention Coordinator, Office of the Attorney General
Bobbie Gang, Nevada Women's Lobby and National Association of Social Workers
Randy Oaks, Captain, Las Vegas Metropolitan Police Department
Richard Broo, Concerned Citizen
Judy Matteucci, Director, Department of Administration
Senator Raggio opened the hearing on Senate Bill 492.
SENATE BILL (S.B.) 492:Makes appropriation to legislative fund.
John Crossley, Director, Legislative Counsel Bureau, distributed Exhibit C, l993 Legislative Session Costs and Funding, to the committee and testified while referencing that document. It was explained the document reflected the additional cost necessary to continue the l993 legislative session for the time period May 3l, l993, through June 30, l993.
Senator Raggio closed the hearing on S.B. 492.
SENATOR COFFIN MOVED TO DO PASS S.B. 492.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR CALLISTER WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio opened the hearing on Senate Bill 471.
SENATE BILL (S.B.) 471:Creates office of advocate for missing or exploited children and makes various changes relating to clearinghouse for information concerning missing or exploited children.
Senator Glomb distributed Exhibit D, written testimony and various letters supporting S.B. 471, (Exhibit D - Original on File in the Research Library). She explained S.B. 471 creates a well-defined Missing Children's Clearinghouse and gives it the structure and resources necessary to coordinate statewide, national and international efforts to locate and protect missing and exploited children. It was explained this legislation offers full statutory recognition to much of what is already being done in these areas within the Office of the Attorney General, while adding one urgently needed investigative position. Continuing, she stated this legislation would also create a children's advocate to advise the legislative, judicial and executive branches of government on all issues relative to missing and exploited children. Senator Glomb pointed out that all but a relatively small portion of the funding required for the two new positions already exists in the budget of the attorney general.
Frankie Sue Del Papa, Attorney General, Office of the Attorney General, explained S.B. 471 is part of a three-bill package presented to the legislature this session. Citing historical information, Ms. Del Papa stated the Nevada Missing Children Clearinghouse was originally created in l985. In l99l, the office was moved from Carson City to Las Vegas to accommodate the majority of the population. To date, she advised, there are 200 open cases for missing children, the majority of which are interstate parental abductions, with 7 international abductions.
SENATE BILL (S.B.) 470:Makes various changes relating to custody of children.
SENATE BILL (S.B.) 472:Makes various changes in provisions relating to custody of children.
Ms. Del Papa explained S.B. 470 clarifies the rules of custody in situations where there is no court order for custody and defines what the right of custody is for parents where there is no court order. S.B. 47l, clarifies the statute regarding the role the attorney general's office renders in the Missing Children's Clearinghouse. It more accurately reflects the duties and provides full statutory recognition to much of what the agency is doing, she stated. Ms. Del Papa explained S.B. 472 creates one place where attorneys and judges can find statutory authority to order that a child be picked up and returned to their lawful custodian after a parental abduction.
Ms. Del Papa distributed Exhibit E, Fiscal Note dated May 26, l993, to the committee, and noted the budget will be impacted by $l0,400.
Exhibit F, Federal Laws Governing Missing and Exploited Children, was distributed to the committee.
Charles Gardner, Deputy Attorney General, Office of the Attorney General, testified the current 200 open cases with the office of Missing Children's Clearinghouse are comprised mostly of parental abductions. He explained that stranger abduction situations are easy to analyze under the law. However, the law is unclear and difficult to determine individual cases of parental abductions. He estimated from 20 to 25 percent of his time, even though he is assigned to another agency, has been devoted to the Missing Children's Clearinghouse. "That still leaves a lot of items, matters and cases that have not had the proper legal advice. Going to the [Department of] Transportation tells you how far away the clearinghouse has had to go to get legal advice," he illustrated.
Senator Callister joined the meeting at 8:25 a.m.
Mr. Gardner explained the children's advocate position would be required to coordinate civil and criminal law with international and interstate cases. The incumbent would also be required to coordinate between and among district attorneys in and out of the state. Mr. Gardner anticipated there would be immediate growth in this area of need.
Mr. Gardner referenced sections 2 and 3 of S.B. 471 and explained in order to accommodate the Committee for Protection of Children, it is the consensus to delete those sections so the advocate will not sit on that committee.
Judith Allan-Rodriguez, Administrative Director, Crime Prevention Coordinator, Office of the Attorney General, testified in support of S.B. 471. She urged passage of the companion bills to expand the agency's capability to address the issue of exploited children.
Ms. Allan-Rodriguez pointed out 98 percent of the missing children are runaways, an area that also needs to be addressed more aggressively.
Senator Raggio asked what effort is put forth by local law enforcement agencies on these matters and how is their effort coordinated with the Missing Children's Clearinghouse. He queried whether the local law enforcement agencies have that investigative capability.
Ms. Allan-Rodriguez replied she works closely with the law enforcement agencies when requested. She pointed out although the local law enforcement agencies do have investigative capabilities, oftentimes their hands are tied when it is an interstate abduction and it is required they go beyond their resources and/or jurisdiction.
Ms. Allan-Rodriguez stated her estimates, based on the hand tally submitted by the juvenile division of the Las Vegas Metropolitan Police Department in March l993, indicate runaways consisted of 500 cases per month. These estimates indicate nearly l,000 children are reported missing yearly in the State of Nevada.
Senator Coffin asked how many of those l,000 missing children were repeat runaways.
Ms. Allan-Rodriguez replied habitual runaways constitute one-third of the total picture. The long-term runaways, i.e., 6 months or greater, constitute another one-third. First time runaways, i.e., those gone for only a couple of days, are the remaining one-third of the group.
Senator Jacobsen asked what was the ethnic makeup of the missing children in Nevada.
Ms. Allan-Rodriguez replied that although there is a very small percentage of black, Hispanic or oriental cases, there has been an increase in Hispanic cases in the Elko and Winnemucca areas due to Hispanic parents taking children back to Mexico.
Ms. Del Papa distributed Exhibit G, Annual Report from the Office of the Attorney General to The Governor and the Legislature Concerning Missing and Exploited Children, (Exhibit G - Original on File in the Research Library) to the committee.
Senator Raggio declared several interest groups would be in opposition should the Children's Trust Account be opened to include grants. He asked for clarification of the understanding.
Ms. Del Papa responded:
The understanding is...if you delete...section 2 and section 3, that does not take away our ability to put in for a grant. That ability has always been there. In fact, in the past we've received grants from them, have we not?
Ms. Allan-Rodriguez responded they applied for grants but did not receive them.
Senator Raggio interjected:
...Abuse and neglect does not cover exploitation, which is what you said. Now you're saying that under that language they could make grants to groups that deal with exploited children? We'd better have an understanding because that's what these groups were expressing their concern about."
Senator Glomb responded the Children's Trust Account was set up to provide nonprofit groups in the community a funding source to deal with abused and neglected children, particularly within the family setting. In talking with individuals associated with the trust account committee, she asserted it was felt if sections 2 and 3 were left in the bill, they would be mandated to award grant funds in the area of abduction or exploitation occurring outside the family setting.
Senator Raggio restated his concerns. He related various interest groups which currently receive grants from the Children's Trust Account telephoned and were very specific that they did not want the trust account made available to another area concerning exploited children. "So the question is, will it be used for those purposes if we add this capability, or jurisdiction, to your office, without sections 2 and 3?" he asked.
Ms. Del Papa countered those interest groups have control over their own funding. Her understanding was their fears would be totally allayed if sections 2 and 3 were removed from the bill.
Senator Glomb concurred with that understanding.
Ms. Del Papa complained that her accountant failed to include the cost of office rent when preparing the agency's various budgets.
Senator Raggio asked Ms. Del Papa, "If we did approve your budget with this amendment [Exhibit E], that is not going to commit us to an augmentation when we come here next session?"
Ms. Del Papa responded:
Yes, I'm making that commitment....I think this budget is realistic. I think this budget will do a tremendous amount of good in this state. I also know the fiscal problems we face in this state are not going to go away and I am willing to live with this and I definitely would not ask for any additional person. We would have to live with this through this biennium and I think the next biennium.
Bobbie Gang, Nevada Women's Lobby and National Association of Social Workers, testified briefly in support of the measure.
Randy Oaks, Captain, Las Vegas Metropolitan Police Department, testified in support of the three-bill package.
Richard Broo, Concerned Citizen, also testified in support of the three-bill package. He distributed Exhibit H, Report of a Missing Child, to the committee and testified while referencing that document. He disclosed that his son was abducted by his wife and is currently living in the Netherlands. Mr. Broo contended the cost to fight an international charge of abduction was approximately $300,000 "and you may not ever see your child." In summary, he praised the efforts of the Nevada Missing Children's Clearinghouse and urged passage of the bills.
Senator Raggio closed the hearing on S.B. 470, S.B. 471 and S.B. 472.
Athletic Commission - Page 569
Exhibit I, Assembly Committee on Ways and Means Subcommittee on the Athletic Commission Recommendations, (Exhibit I - Original on File in the Research Library) was distributed to the committee.
Senator Callister reviewed the recommendations of the subcommittee responsible for studying the issues of this budget, as outlined in the exhibit material.
It was pointed out the subcommittee recommendation supported the concept of a Medical Advisory Board to the Nevada Athletic Commission to oversee the medical condition of the boxers during their competitions. There was no funding established for the Medical Advisory Board, however.
Judy Matteucci, Director, Department of Administration, provided testimony of her recollection the Medical Advisory Board salaries were relinquished during the budget cuts. She stated the Governor's recommendation was that the Medical Advisory Board be combined with the Nevada Athletic Commission.
SENATOR CALLISTER MOVED TO ADJUST THE BUDGET AS INDICATED ON EXHIBIT I, CONSISTENT WITH ACTION TAKEN BY THE ASSEMBLY COMMITTEE ON WAYS AND MEANS.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio recessed the meeting at 9:35 a.m. and reconvened the meeting at 9:50 a.m.
Controller's Office - Page 47
Closing List #24, Exhibit J, (Exhibit J - Original on File in the Research Library) was distributed to the committee.
Dan Miles, Fiscal Analyst, testified the closing action restores the data processing function within the controller's office, which adds back l0 computer-related positions and training funds removed during the consolidation proposal.
Senator Raggio asked how the FAMIS [Financial Accounting Management Information System] would be impacted by this action.
Mr. Miles stated:
This is based partially on the original Governor's recommended budget and partially by the revised budget proposed by the controller which would have him use the balance of the l99l one-shot appropriation to pay off the Hewlitt Packard enhancements. Then there is a one-shot request for $l50,000 for the feasibility study, which is in the Governor's budget....
Senator Raggio noted the controller's proposal in lieu of the feasibility study was to complete the implementation of the FAMIS system. Senator Raggio solicited comments from Senator O'Donnell, who served on the subcommittee reviewing this budget.
Senator O'Donnell provided the following overview:
I spent several hours with the controller talking about this issue. It is true that there would be some savings in moving the data processing department...but the cost, once you get there, is almost completely obliterated because of the fact you have a licensing fee on the FAMIS software...around...$600,000 [more] than it would be if it's left on the mini system. So I asked the controller's office to come up with a migration path to upgrade his system to the FAMIS software. He has not done that as of yet. My inclination is to continue on with the computer system that the controller has at the present time to develop the software. I think, in the long run, it's going to be cheaper.
Senator Raggio asked if the budget closing sheet accommodated the concerns of the controller.
Mr. Miles and Senator O'Donnell concurred the budget closing recommendation would accommodate the concerns of the controller.
SENATOR O'DONNELL MOVED TO ADJUST THE BUDGET IN ACCORDANCE WITH EXHIBIT J, TO INCLUDE A LETTER OF INTENT TO PERMIT THE STATE CONTROLLER TO APPEAR BEFORE THE INTERIM FINANCE COMMITTEE AND PROVIDE AN UPDATE.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS CALLISTER AND RAWSON WERE ABSENT FOR THE VOTE.)
* * * * *
SENATE BILL (S.B.) 273:Makes appropriation to the office of state controller for expenses relating to assessment of need for statewide accounting system.
SENATOR COFFIN MOVED TO DO PASS S.B. 273.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS CALLISTER AND RAWSON WERE ABSENT FOR THE VOTE.)
* * * * *
Benefit Services Fund - Page l92
Mr. Miles testified the Governor's reorganization plan proposed to change the status of the Committee on Benefits from policy making to advisory status. The Governor's plan also proposed the name change of the Benefits Commission. The Benefits Commission was proposed to act on matters relating to the state Deferred Compensation Program, which would result in the elimination of the Deferred Compensation Committee, he stated.
ASSEMBLY BILL (A.B.) 206: Requires legislative auditor to conduct performance audit of state's program of group health insurance that is provided by committee on benefits through plan of self-insurance.
Continuing, Mr. Miles stated:
...Assembly Bill 206 would require the legislative auditor to conduct a performance audit of the state self-insured program....There is a $7,500 fiscal note accompanying that bill. They do contract administration for the prison medical administration and those are inmate-driven costs, depending on how you close the prison budgets with less or more inmates involved, there may be an impact from that cost within this budget....We've also attached a memorandum from the [State] Risk Manager [page 7 of Closing List #24] on the estimated premiums for dependent coverage in l994 and l995.
Judy Matteucci, Director, Department of Administration, interjected to clarify the misunderstanding:
Those were not estimates. Those were numbers that were provided at the request of your staff...given the situation at the time. I want it to be clear that those are not estimated dependents and certainly circumstances change over time that are going to affect what the dependent premium amounts have to be.
Your staff asked for a what-if scenario if today were the reality of the situation. Unfortunately that memo has been given to some groups and distributed as to what our recommendation is for dependent premiums. That is not the case. We won't be determining that until we see what the status of the fund is later in the fiscal year, and I want to be sure the committee understands that.
Senator Coffin interjected that additional information was requested from the State Risk Manager. That information was distributed to the committee, Exhibit K, memorandum dated April 27, l993, from David Thomas. The memorandum answers the questions regarding the cost impact of restoring the benefit plan changes made by the Committee on Benefits to the employee health benefit plan, he declared. Senator Coffin explained he distributed copies of that correspondence to individuals in the industry. He said:
We came back with a wide variation...that showed the Department of Administration response through [State] Risk Manager Thomas was [that] perhaps a 28 or 29 percent increase might be needed, in increments needed to restore certain benefits should we be able to find the money to do that on a pick-and-choose basis....It concerns me because we do want to do the right thing for the employees....I wouldn't want us to close this budget, or any related budget, until we know for sure what it would actually cost to do that.
Senator Raggio announced all budgets will have to be closed by the end of next week. He explained some of the closed budgets may have to be reopened to make further adjustments. He declared this budget held until next week.
Ms. Matteucci expressed her concern that an outside actuary, without all the detailed information, "would give you a number....I would be happy to see if our actuary...could come in and walk you through some of the assumptions."
State Employees Workers Compensation - Page l97
Mr. Miles testified this account is funded by uniform assessments to state agencies through the payroll system of the Department of Personnel.
Senator Raggio wondered whether to close this budget previous to determination of the final action on the State Industrial Insurance System (SIIS).
Ms. Matteucci opined this budget could be closed and elaborated:
The deductible, I don't think is going to necessarily impact this budget. As we discussed, when this was heard, we explained this did not take into consideration the lower caps. As a result of that, if there is some kind of...resulting rate increase because you have lower employee...caps that were originally anticipated, we think that will offset. The Assembly Committee on Ways and Means closed this Governor's recommendation. I don't see any reason for you to have to adjust it at this point in time....
Senator Raggio opined:
Whatever the final action is on that SIIS bill, we know there is going to be an added cost to the state as an employer if there is a deductible, and it's almost certain there will be....
Ms. Matteucci responded:
If you want to put it in here, then you will have to probably increase the assessment. If you do that, then the agency that may be the more accident prone agency is going to get a break and be distributed across the board to those that are not necessarily accident prone.
If the idea was to make employers more conscious of the safety of their workplace, which I believe was part of the reasoning, then to just include it in the assessment defeats that very purpose. That's the argument against putting it into a central assessment fund and having risk management pay it....
On the other hand, if you leave it to each particular agency to pay it, you cannot really budget it because the agencies are going to have to absorb it....I'm suggesting you do not need to budget it because you don't know where the accidents are going to happen....
Senator Raggio offered the recommendation, "We've got to have $l million some place to pay for it in the state budget...."
Ms. Matteucci replied, "...Then you want it centrally assessed. If you want it centrally assessed, then I suggest you hold this budget. We'll go back and calculate whether we need to adjust the rate."
Senator Raggio insisted the budget be held until final action is taken on the SIIS.
Ms. Matteucci repeated it was not necessary to hold this budget. She concluded:
...I'll go back and assess if we plug $l million here to cover the deductibles, whether or not this budget, as it's represented to you...needs to be adjusted in view of the fact that it was based on a higher $36,000 cap....
Senator Coffin offered the suggestion to Ms. Matteucci:
Since it's also being kicked around that deductibles be adjustable and that the premium contribution be adjusted accordingly, depending on the employer's choice, maybe you might want to do the same thing. You may want to see what it would cost to adjust your deductible.
Ms. Matteucci reminded the committee when accounts are closed at the end of the legislative session, she has the authority to adjust the rate if the budget is underfunded.
Public Works Administration - Page 287
Mr. Miles referenced page l8 of Exhibit J and explained the proposal was to combine the State Public Works Board Administration and Department of Finance budgets. He explained if the director position is removed from the State Public Works Board Administration budget and you "let the director of the Department of Finance be the surviving position, then you need to restore the manager of the [State] Public Works Board and that's what this budget closing action would do."
SENATOR O'DONNELL MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY STAFF AND OUTLINED IN EXHIBIT J, PAGE 18.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
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Insurance Loss Prevention - Page 291
Mr. Miles advised this is a new budget account created to provide for the risk management and loss control function which is currently administered by the Risk Management Division. This account is recommended by the Governor to analyze risks to state property and make recommendations to minimize or eliminate those risks. The Governor also recommended the budget be administered by the proposed Construction and Facilities Division of the Department of Administration and includes a new insurance loss prevention specialist position to replace the assistant risk manager, effective July l, l993, he noted. Mr. Miles offered no budget recommendation for this account.
SENATOR COFFIN MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY THE GOVERNOR AND OUTLINED IN EXHIBIT J, PAGE 21.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
* * * * *
Buildings and Grounds - Page 294
Larry Peri, Program Analyst, recommended the building rent revenue collected from state agencies within state-owned office space be increased in each year of the biennium. He explained the adjustments to the Building Rent revenue category will align the original amount recommended by the Governor with the revised amounts provided by the Budget Division in the updated rent schedule. He mentioned Vacancy Savings were increased to reflect the salary of the administrator, which was included in the reorganization savings. Mr. Peri explained the amount of $l49,964, recommended in FY l995 for relocation costs for state agencies to be moved to the new state office building in Las Vegas, were placed in a separate Expenditure category to allow for clearer accounting control of these expenditures.
Senator Coffin requested the budget be held.
Administration Services Division - Page 304
Mr. Peri highlighted the changes to this budget account as outlined in Exhibit J, page 24. He explained this account has previously been known as General Services Accounting. The Governor's Executive Budget proposes it become the central accounting function for the new Department of Administration.
Continuing, Mr. Peri noted the recommended adjustments delete the director's salary and supporting costs. As the Department of Finance and Department of Administration are proposed to be combined, the director's position will be included in the Budget Division's account, he recited. Similarly, the other positions recommended for deletion coincide with the Department of Personnel and Department of Data Processing both being recommended to remain in department level status.
SENATOR COFFIN MOVED TO APPROVE THE BUDGET AS RECOMMENDED BY STAFF AND OUTLINED IN EXHIBIT J, PAGE 24.
SENATOR O'DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.)
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Gaming Control Board - Page 320
Bob Guernsey, Principal Deputy Fiscal Analyst, recommended the General Fund appropriation be adjusted to reflect the reduction in the purchasing assessment. That action has similarly been taken across all budgets.
Additionally, the Senate Committee on Finance requested information with reference to the horse racing activities, Regulation 6-A and the Gaming Policy Committee, Mr. Guernsey stated, and noted the agency response is included in Exhibit J.
Due to time constraints, Senator Raggio adjourned the meeting at l0:25 a.m.
RESPECTFULLY SUBMITTED:
Dee Crawford,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE:
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Senate Committee on Finance
May 27, 1993
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