MINUTES OF THE
SENATE COMMITTEE ON FINANCE
Sixty-seventh Session
June 28, 1993
The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:00 a.m., on Monday, June 28, 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:
Daniel G. Miles, Fiscal Analyst
Robert Guernsey, Principal Deputy Fiscal Analyst
Jeanne L. Botts, Program Analyst
Birgit K. Baker, Program Analyst
Judy Jacobs, Committee Secretary
OTHERS PRESENT:
Rose McKinney-James, Commissioner, Public Service Commission of Nevada
Captain William Goddard, Deputy Commander, Field Operations Bureau, Department of Motor Vehicles and Public Safety
Judy Matteucci, Director, Department of Administration
Robert R. Loux, Executive Director, Agency for Nuclear Projects
Ashley J. Hall, Nevada Library Association
Senator Raggio opened the hearing on Assembly Bill (A.B.) 748.
ASSEMBLY BILL 748: Makes appropriation to Nevada highway patrol of department of motor vehicles and public safety for pilot program for Alliance of Uniform HazMat Transportation Procedures.
Rose McKinney-James, Commissioner, Public Service Commission of Nevada, explained she was appearing in her capacity as the outgoing chairman of the Alliance for Uniform HazMat (Hazardous Materials) Transportation Procedures. She described it as a working group that came into being as a result of section 22 of the Hazardous
Materials Transportation Uniform Safety Act.
Ms. James asked for support for A.B. 748. She said the funding would provide for a pilot program to test the ability of states to register and permit motor carriers who transport hazardous materials through a program developed over the past 2 years by members of the group.
Ms. James indicated Captain Goddard of the Nevada Highway Patrol (NHP) developed the budget for the pilot program which has been reviewed by both the budget office and the Fiscal Analysis Division of the Legislative Counsel Bureau (LCB). She added Donald M.
Bayer, the Senior Research Analyst for the Radioactive Waste Program of the LCB, served as a member of the alliance.
Ms. James asserted the focus of the program was to test a series of regulations developed by the alliance over a 2-year period. She said the regulations are similar to an international registration program in which the NHP is involved. She declared the aim is for a base-state program which would provide reciprocity for all the states that participate in the program.
Ms. James explained the provisions for HAMTUSA (Hazardous Materials Transportation Uniform Safety Act of 1990) will require state compliance for any state that wishes to have a program for the registration or permitting of carriers who transport hazardous materials.
Ms. James opined participation in the pilot program will provide a great opportunity to be proactive and "on the right side of the development of this program." She said the Nevada Motor Transport Association and the Department of Transportation offered support when the matter was heard on the assembly side.
Senator Rawson recalled there had been a floor challenge the last time a HazMat bill went through. He suspected funding has been presented in small segments. He asked what kind of overall plan was being presented for HazMat for the session.
Ms. James replied her activities had been limited to the pilot program. She indicated the Federal Highway Administration was going to provide $50,000 to each of the states that engage in the pilot program. She listed the other states slated to participate as West Virginia, California and Ohio. She reiterated the importance of participating in the pilot program due to the significant amount of hazardous waste that is transported through the state.
Senator Glomb reflected a bill to provide training with money from the General Fund had been introduced. She had not voted for the measure because she felt there were other funding sources for training from the federal government. She concurred with Senator Rawson that there is a need for a comprehensive plan.
Captain William Goddard, Deputy Commander, Field Operations Bureau, Department of Motor Vehicles and Public Safety, NHP, offered his agreement. He explained the 1991 HazMat Act required that a committee be formed to devise uniform rules and regulations for nationwide use. He said approximately 30 states now have some sort of registration or fees for hazardous materials. Nevada would be one of the four states developing those rules, regulations and policies that would be mandatory in all states by 1996.
Captain Goddard pointed out the fiscal note was developed regarding the time frame under which the objectives must be reached, a 2-year period. Ms. James interjected her agreement that emphasis must be placed on uniformity. She said:
The provisions of the Hazardous Materials Transportation Uniform Safety Act suggests to the states...that if you cannot go forward in a uniform fashion, we will preempt you. The State of Nevada has had a substantial program with respect to the registration and permitting of motor carriers who transport hazardous materials. We believe that we have compelling interest to continue to do that, and the only way that we can continue to do that is if we
are in compliance with the regulations which Don Bayer and I have had the privilege to assist in developing.
Ms. James reiterated the intention to test the validity of the regulations that have been developed from a practical standpoint. She opined the best method to do so would be through participation in the pilot program, especially with the participation of California.
Ms. James acknowledged other activities related to hazardous materials such as response training, but she repeated A.B. 748 would be directed toward motor carriers.
Senator Raggio asked if there was a budget. Captain Goddard said a proposed budget calls for an appropriation from the highway fund for less than $150,000 for the biennium. He explained it would provide two staff positions, one of which would serve primarily as liaison between the states. The other person would concentrate on developing and testing the programs in the state. Upon conclusion of the pilot program the two people would probably be absorbed into the system.
Senator Raggio asked if that meant this appropriation would have to be budgeted in the future. Captain Goddard acknowledged it would have to be reviewed in 2 years.
Senator Raggio asked why a pilot program was necessary and why Nevada should participate. Ms. James responded the pilot would develop forms to be used by all states, would regulate the terms for fees and would regulate the types of motor carriers and the commodities to be transported, all formulated through use of some practical experience.
Ms. James repeated Nevada will benefit due to the amount of materials transported through the state and it would be beneficial to participate in the framework of the rules. Upon completion of the pilot, if Nevada wants to continue to register and permit carriers it will have to comply with the regulations. She asserted the state will be ahead of other states that will become involved and will be able to recover funds from the administrative fees that will be part of the program. The four participating states will be required to identify funding sources to support the pilot program which will depend upon the individual needs of the states. The Federal Highway Administration will provide $50,000 to each of the participating states for the 2-year program, which amounts to a supplement of $25,000 each year to the amount budgeted in A.B. 478.
Captain Goddard provided copies of the budget (Exhibit C. Original is on file in the Research Library.) to the committee. He told the committee the pilot team would be housed with the Department of Motor Vehicles and Public Safety.
Senator Raggio inquired if the appropriation had the support of the Governor. Judy Matteucci, Director, Department of Administration, nodded.
Senator Glomb made the assumption the rationale for the bill was to give Nevada the opportunity to offer input to the regulations. Ms. James confirmed her assumption. Senator Glomb asked who would represent Nevada in the promulgation of the regulations. Ms. James responded she had been the representative since 1992, appointed by the National Association of Regulatory Commissioners, and has recently been made chairman of the alliance. She added Donald
Bayer of the LCB was nominated through the National Conference of State Legislatures.
Ms. James stated:
On a continuing basis, one of the significant aspects of any base-state program is to assure that there is a...national, central repository that has a governing board that determines the overall policy for the program. The pilot governing board will be comprised of several individuals who were elected through the alliance and then the representatives from those states that will be a part of the pilot. I have been asked, therefore, pending legislative approval, to serve as liaison.
Ms. James explained that was the reference in the latter part of the bill indicating that the Public Service Commission of Nevada (PSC) will have an ongoing role in the pilot program. The bill also will require reporting to the legislature.
Referring to the items listed on the budget, Senator Raggio asked if it would not be possible to use the equipment already in possession of the NHP. Captain James answered the project should be a stand-alone project because it will be so intensive. He suggested the travel costs could be reduced through use of a computer and FAX (facsimile) machine to interface with the three other states in the pilot.
Senator Jacobsen voiced concern the project would not include rail transportation. He asked if this project will tie in with the other HazMat projects in the state. Ms. James replied the provisions of the Hazardous Materials Uniform Safety Act only relate to motor carriers. She said the alliance has recommended to the Federal Highway Administration coordination with the use of rails, but the United States Congress did not include anything other than motor carriers. She did not believe there would be any duplication of other private or government projects within the state.
In the absence of further testimony, Senator Raggio closed the hearing on A.B. 748. He invited the committee to consider a bill draft request (BDR).
BILL DRAFT REQUEST S-2178: Authorizes expenditures by agencies of state government.
Senator Raggio asked Daniel G. Miles, Fiscal Analyst, to describe BDR S-2178 (Exhibit D. Original is on file in the Research Library.) Mr. Miles explained it was a rough draft of the general authorization act to collect and expend monies. He said it does not include any General Fund or highway fund dollars with the exception of provisions for the State Gaming Control Board.
Mr. Miles explained section 1 lists the sum total of amounts for fiscal years (FY) 1994 and 1995 for each budget account that has an authorized level of expenditure. He indicated most of the funds are derived from fees or transfers from other accounts or federal funds. The list was compiled from joint actions taken by the Senate Committee on Finance and the Assembly Committee on Ways and Means.
Mr. Miles pointed out the list is based upon the proposed reorganization bill, Assembly Bill (A.B.) 782.
ASSEMBLY BILL 782: Reorganizes administrative structure of executive department of state government.
He noted A.B. 782 will become effective on October 1, 1993, while BDR S-2178 will become effective on July 1, 1993.
Mr. Miles described section 2 as the General Fund authorization to the State Gaming Control Board. He explained it was included in BDR S-2178 to comply with chapter 463 of the Nevada Revised Statutes (NRS) which authorizes expenditures approved by the legislature. He said it provides for $17.1 million from the General Fund for the first year of the biennium and a little less for the second year.
Mr. Miles drew attention to a new provision, subsection 3 of section 2, included because the question of the slot route operator tax has not yet been resolved. He recollected there had been an enhancement item in the budget for the gaming control board for five new positions under the operation of the board for the proposed new slot route operator tax. The tax was to be based upon gross gaming revenue. He explained this subsection would delete those positions from the budget if the slot route operator tax fails to pass.
Senator Raggio reported the issue is still under debate in the assembly. They are considering not only whether there should be a tax, but also whether it should be a flat tax or one based on gross gaming revenue. He indicated the five positions would only be necessary if a tax based on gross revenue is enacted. If it is merely an increase in the flat tax, the positions would not be necessary.
Mr. Miles said section 3 starts what is referred to as the "boiler plate," which he alleged always appears in the authorization act addressing procedures. Section 4 is another common clause which allows the augmentation or reduction of amounts authorized in sections 1 and 2 by the chief of the Budget Division should it become necessary or apparent the levels will not be reached. He pointed out subsection 2 provides the same authority to the LCB, with approval of the legislative commission.
Mr. Miles noted section 5 also has appeared in the authorization act for a number of years. It provides that when both General Fund and other revenues are appropriated for the operation of an agency, if the other revenues exceed what had been approved for receipt, the General Fund appropriation would be reduced by a like amount unless it would jeopardize the receipt of the other funds.
Section 6 is an exception to section 5, Mr. Miles declared. It applies to the university system in regard to student fees. If the student fees exceed the level for which they were budgeted the additional funds may be expended with Interim Finance Committee (IFC) approval.
Mr. Miles explained section 7 would allow a short-term loan from the General Fund to the Department of Wildlife up to 50 percent of the amount receivable from federal sources.
Section 8 allows the listed amounts to be expended from the Nevada Endowment Fund, derived from estate tax, for the university system. Mr. Miles stated the amounts listed have already been included in the university and community college budgets.
Mr. Miles explained section 9 gives the chief of the Budget Division the authority to assess professional and licensing boards
the proportional share of costs in the Budget Division attributable to those boards. The provision had been included in the act before.
Mr. Miles pointed out section 10 will require the director of the Department of Administration to prepare a statewide cost allocation plan. He explained it results in the return of some revenue to the General Fund from the federal share of some state services.
Mr. Miles noted section 11 provides the collection mechanism and amounts from the counties for the public defender. The amounts were calculated according to the counties that wished to stay in the public defender system.
Mr. Miles reminded the committee there had been a decision to split the motorboat fuel tax allocations between the Department of Wildlife and the Division of State Parks budgets. He said section 12 would require that split.
Mr. Miles explained section 13 directs the expenditures for the public education and public information programs for the Department of Industrial Relations. It requires the approval of the IFC for the second year of the biennium.
Mr. Miles said section 14 consists of transitory language that will also appear in the general appropriations act. It was necessary due to the fact the reorganization act will become effective on October 1 while the appropriations act will become effective on July 1.
Senator O'Donnell stated he would like some assurance that the approval of $14 million for high-level nuclear waste will have proper accounting. Mr. Miles responded it would come under the same budgetary control mechanisms as all other state agencies. All claims and contracts must be approved by the preaudit section of the State Board of Examiners, the books of record must be reviewed by the state controller and weekly accounting of expenditures are monitored by the agency, the Budget Division and others.
Robert R. Loux, Executive Director, Agency for Nuclear Projects, concurred with Mr. Miles that the control over his agency was the same as over any other state agency. He assured the committee the meetings are open and indicated he works closely with Senator Thomas J. Hickey and with the legislative oversight committee. He offered to provide information any time it is requested.
SENATOR RAWSON MOVED FOR COMMITTEE INTRODUCTION OF BDR S-2178.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
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Senator Raggio announced another hearing on the matter would not be scheduled unless someone felt it was necessary. He offered to accept a motion to do pass subject to any change when it is placed on general file.
SENATOR JACOBSEN MOVED TO DO PASS BDR S-2178.
SENATOR O'DONNELL SECONDED THE MOTION.
Senator Callister indicated his intention to introduce amendments to both the authorization and appropriation bills. Under those
circumstances, Senator Raggio agreed to bring the bill back for another hearing. He stated he would not accept the motion until it was determined whether the bill should be returned to the committee for further discussion.
Senator Raggio asked the committee to consider the draft for the appropriations act (Exhibit E. Original is on file in the Research Library.) which will emanate from the assembly. He asked Mr. Miles to go over the provisions.
Mr. Miles explained everything that precedes the draft, which begins on page 13, is the list by budget account of the amounts to be appropriated for each of the next 2 years from the General Fund and the highway fund. He declared section 30 is the same "boiler plate" language as in the authorized expenditures act, which requires monies expended to be in accordance with the budget act and includes the allotments and transfers addressed in chapter 353 of NRS. He called attention to subsection 3 of section 30 which excludes the supreme court from the requirements of the executive branch.
Mr. Miles said section 31 has appeared in the appropriation act for a number of years. It transfers authority between fiscal years for certain accounts, most of which require payment to a client-group such as senior citizens, property tax or forest fire suppression.
Mr. Miles continued with section 32, the provision for amounts appropriated to the legislative fund. Those funds do not revert to the General Fund, and they are available for both years of the biennium after approval of the legislative commission.
Mr. Miles recalled limitations on the amounts that could be requested by the Welfare Division. He pointed out the first paragraph in section 33 states that the amounts appropriated are limits and additional requests may not be made except under certain conditions cited.
Mr. Miles noted the $3 million appropriated but not needed by the IFC for the contingency fund for Medicaid during the past biennium had been reverted to the General Fund. The amount being proposed for contingency for the coming biennium is $8 million.
Mr. Miles said section 34 would allow the Welfare Division to transfer funds between budget accounts with approval of the IFC.
The same thing would apply to the Department of Prisons under section 35.
Mr. Miles described section 36 as the vacancy savings transfer provision which has been included in the act at least twice before. He pointed out most of the reorganization savings had been identified as vacancy savings. This section allows transfers between budgets within the same departments.
Section 37 ties the university system to NRS 353.224 which Mr. Miles explained would give the Governor authority to reserve or reduce budgets in the event of a fiscal crisis.
Mr. Miles averred section 28, which appropriates funds to the legislators' retirement system, is always included in the appropriations act.
Section 39 was described by Mr. Miles as the general reversion clause. He indicated it limits agencies from encumbering many of their appropriations after June 30 of each fiscal year, and those
amounts not encumbered, except those from the legislative fund, revert to the fund from which they were appropriated.
Mr. Miles said section 40 would allow the Department of Prisons to make purchases for the warehouse account and then to charge as deliveries are made. It permits the account to borrow from the prison accounts.
Continuing his narrative, Mr. Miles said section 41 would require the state controller to keep the books open until the last Friday in August so all activity can be recorded for the appropriate fiscal year. Section 42 requires the controller to designate up to $50 million, if available, of the unreserved fund balance as a reserve to stabilize the state budget.
Mr. Miles said section 43 would require the controller to make the transfers necessary to carry out the budget. Section 44 would require the State Board of Health to increase fees to meet the budget levels. Section 45 would appropriate $3.4 million to the IFC contingency fund to restore it to the $8 million approved.
Mr. Miles explained section 46 would amend chapter 510 of NRS regarding appropriations made in 1991 to the honor camps.
Mr. Miles said sections 47 and 48 go together to meet a plan to cover a shortfall in the administrative assessments in the supreme court budget in the work-program year.
Section 49 was described by Mr. Miles as contingent appropriations
to restore funds in the Department of Prisons if the compassionate release bill fails to pass since the original budget was approved under the assumption A.B. 488 would pass.
ASSEMBLY BILL 488: Provides for expedited release from prison of terminally ill or physically incapacitated prisoners.
Mr. Miles recalled section 50 had been under recent discussion regarding situations under which an internal affairs program could be implemented by the Department of Motor Vehicles and Public Safety.
Senator Raggio remembered the senate had budgeted for some internal affairs programs. Mr. Miles said the assembly removed that program from the budget and then it was restored with the proviso that permission be obtained from the IFC. Senator Raggio recalled the joint action had been to support the internal affairs program but to limit it to commissioned personnel. Mr. Miles responded that is included under section 50, but it still requires IFC approval.
Mr. Miles explained section 51 relates to the Governor's authority to reserve funds in the event of a fiscal crisis. He said the section is complimentary to A.B. 409.
ASSEMBLY BILL 409: Makes various changes relating to state financial administration.
He asserted A.B. 409 would enhance NRS 353.225 to say that the Governor shall follow the guidelines established by the legislature in creating reserves in case of a fiscal crisis. He said $35 million was selected as an ending fund balance and when the sum goes below $35 million the authority is triggered to set aside a reserve.
Mr. Miles explained:
Section 51...requires that if the projections of the ending fund balance of the state General Fund fall below the estimated level of the 1993 legislature,...around $55 million,...the chief of the Budget Division must report that to the [State] Board of Examiners. Then the board of examiners...has to determine whether the ending balance is projected to be less than the $35 million,...which would...be a $20 million shortfall...in available income for either one of those fiscal years.
Mr. Miles continued to say the Governor could then direct implementation of a reserve to be set aside of not more than 15 percent. He said A.B. 409 enhances section 51 of the appropriations act, and it would enhance the authority of the legislature in directing the Governor how to handle a fiscal crisis. He noted subsection 3 of section 51 prevents a reserve from being set aside unless certain conditions are met regarding approval by either the legislature or the IFC. To set aside a reserve beyond 15 percent, the Governor would have to call a special session of the legislature.
Ms. Matteucci interjected:
What this language would do, would say...that once the [State] Board of Examiners, based on the projection of revenues, would determine that the ending fund balance would be less than $35 million, which is approximately $20 million below what we need to maintain the 5 percent minimum, then we would prepare a plan that could not cut any appropriation more than 15 percent. That plan, for reserving, would then be brought to the Interim Finance Committee, and the Interim Finance Committee would have to approve that plan. If we had, upon approval of that plan, to cut more than 15 percent you have to...call a special session.
Mr. Miles concluded section 52 is the same as the language at the end of the authorization act. It provides for the transitional period between July 1 and October 1 when the reorganization plan becomes effective.
Senator Raggio turned to a review of Senate Bill (S.B.) 511.
SENATE BILL 511: Revises provision concerning program of accountability for public schools.
SENATOR RAWSON MOVED TO DO PASS S.B. 511.
SENATOR JACOBSEN SECONDED THE MOTION.
Senator Glomb pointed out the fiscal note indicates more than the $100,000 appropriation indicated by the measure. Senator Rawson responded there had been a letter from Dr. Eugene Paslov, Superintendent of Public Instruction, that the work could be done for $50,000 per year which would be covered by the $100,000. Senator Glomb expressed disbelief that a statewide accountability system could be accomplished for $100,000, especially if it were done in depth. She felt basic information should be obtained without an additional appropriation.
Senator Callister reported he had requested an answer from the major school districts and from the State Board of Education whether or not the information was already available. He indicated he has been told the information is available and the charge would be for a compilation of information already available.
Senator Callister asserted he was troubled that the per-pupil guarantee has been reduced, or at least not increased, that public education has been "gutted" in terms of classroom dollars and that the public has become disenchanted with administrative expenses in education. He expressed doubt that the accountability program will provide any improvement but declared he would support it even while he intends to watch it closely. He suggested the average parent would not know how to access the information.
Senator Coffin agreed with Senator Callister's notion that the data is already available. He recalled a conversation with Dr. Paslov in which it was indicated the State Department of Education meets monthly with school superintendents. He alleged those meetings should include accountability. He said the ideas expressed by Senator Callister, who intends to support the motion, were the same ones he felt were reason to oppose the motion. He declared he would like to support the idea if the chair would entertain an amendment to remove the appropriation, and he asked if Senator Callister would support such a motion.
Senator Raggio asked Senator Coffin to restate his motion.
SENATOR COFFIN MOVED TO AMEND THE MOTION TO DO PASS S.B. 511 BY REMOVING THE APPROPRIATION.
SENATOR CALLISTER SECONDED THE MOTION.
Senator O'Donnell commented that accounting is a necessary cost of doing business. He charged accounting was done to obtain data from which better decisions could be made. He suggested, "If we don't have any appropriation in this measure, we will get exactly what we pay for--nothing."
Senator Jacobsen voiced his agreement with remarks made by Senator Callister and Senator Coffin. He recalled an IFC study had been done in which a major recommendation had been made in regard to accountability in the schools. He also concurred with Senator O'Donnell that the program would not be successful without proper appropriations.
Senator Raggio recalled Dr. Paslov had indicated S.B. 511 was essential to develop a technically sound accountability system. He recognized the committee was in accord that there should be meaningful accountability that is not now present and S.B. 511 would provide the level of accountability sought by the public. He suggested it would be meaningless to pass the bill without funding.
Senator Coffin stated the reason he had moved to amend out the money was due to the persuasiveness of Senator Callister's arguments. He recalled there had been testimony that a study is being created by the Center for Reporting Education Accountability and Teacher Evaluation by the University of North Carolina and by Western Michigan University. He said that report, under which the best education reporting systems in the country have been reviewed, is due in August and the state will be given the report without any charge.
Senator Coffin stated that William (Rick) Millsap, representative of the Nevada State Education Association, had voiced opposition to the bill as a whole and had informed him about the forthcoming report. He reiterated his position that the information should be attainable without new funding. He suggested:
Should the amended motion pass and...no money be granted...when these...national studies are done and it is discovered that...some additional funding might be needed...to particularize it to our situation, that the Interim Finance Committee be approached and give money to our State Board of Education. Should it...see that there's something meritorious in these other studies...we could have for free, and then, if they're stuck, if they need data processing, number crunching money...that we give it to them...but not take it away now from the other important needs that are in the budget.
Senator Glomb voiced the opinion the State Department of Education already has enough money in its budget to conduct a compilation
of the data for the accountability bill. She declared she could not support an appropriation of $100,000. She indicated she was disturbed because she had been told that many bills with small appropriations were going to be handled on an equal basis according to how many funds were available after the major issues were resolved.
Senator Glomb recalled a bill introduced on January 21 requesting assistance for foster parents for children at risk. She opined the $100,000 would be better spent for a raise for the caregivers of those at-risk children. She suggested those children might perform better in school if some of the risks were diminished. She pointed out it has been 7 years since those families have had an increase in the amount allocated for the care of at-risk children.
Senator Callister supported the view taken by Senator Glomb. He pointed out he, too, had the understanding all the bills with small appropriations would be resolved simultaneously.
Senator Raggio remonstrated S.B. 511 would require a hearing in the other house if it should pass and that it was the goal of the legislature to adjourn by Wednesday. He added all other bills that require appropriations will have to be considered, depending upon the amount of money available once the revenue bills are passed. He acknowledged Senator Callister's point was well taken.
Senator Callister pointed out more than $400 million will be spent each year on education. He asserted large sums are spent to administer education. He admitted it might be a better plan to feed the children a little better.
Senator Raggio stated the issue of accountability had been discussed for at least two decades and any inference that the chair was giving it priority was being done under the urging of the public.
THE MOTION TO AMEND FAILED. (SENATORS RAGGIO, RAWSON, JACOBSEN AND O'DONNELL VOTED NO.)
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Senator Glomb alleged that every poll she has seen for several years has indicated statewide support to give parents of foster children an increase. She noted the money goes directly to the care of at-risk children.
Senator Callister admitted he, too, had heard much discussion over accountability. He reiterated he has heard even more complaints about the perceived abundance of administrative expenses at both the state and local levels. He suggested the complaints voiced were approximately 10 to 1 regarding the waste of money on programs that do not produce a product.
Senator Coffin submitted that studies of accountability should be ongoing. He noted that Dr. Paslov had revealed that he could do the study without money. He opined that it should be the responsibility of the State Board of Education to assess accountability under their budget and they should have the ability to glean the information from their monthly meetings with superintendents. He declared he would have to oppose the measure due to the funding.
Senator Raggio asked for a vote on the main motion.
THE MOTION TO DO PASS S.B. 511 CARRIED. (SENATORS COFFIN, GLOMB AND CALLISTER VOTED NO.)
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Senator Raggio announced that the Senate Committee on Finance would reconvene at the call of the chair following the last floor session of the day. He said action would be taken on the authorization bill so that anyone who wished to amend it should acquire amendments prior to that meeting. He suggested that anyone wishing to amend the appropriation bill should contact the assembly where it will be initiated. He told the committee he would ask the LCB to expedite any amendment for either measure.
Senator Raggio opened the hearing on S.B. 300. Senator Jacobsen said he had been informed the state librarian is out of town and would appreciate delaying action on the measure.
SENATE BILL 300: Directs state librarian to establish pilot project to provide grants to certain public libraries for purchase of books and library materials.
Ashley J. Hall, Nevada Library Association, endorsed S.B. 300. He called attention to the fiscal note. He said it was the position of the association that they would accept any funds appropriated for the purpose of grants to libraries.
Mr. Hall noted specific libraries were excluded and the measure is primarily aimed at rural libraries or libraries in need. He explained any grant would be on a 50-50 basis to those that qualify. He indicated no library would receive a grant without first putting up its own money, and no grant would take away from additional appropriations for which a library had applied.
Mr. Hall pointed out a nearly identical measure passed the senate last session but had not passed the assembly. He expressed hope this bill would pass both houses.
Senator Coffin asked if this appropriation was included in the budget. Mr. Hall replied that, to his knowledge, it was not included.
Senator Glomb asked if the $250,000 funding appropriated by the bill was to come out of General Funds. Mr. Hall answered that it was.
Senator Raggio inquired which libraries were included or excluded. Mr. Hall replied libraries in the metropolitan area of Las Vegas that are part of the consolidated library district would be excluded.
In the absence of further testimony on S.B. 300 Senator Raggio closed the hearing on the matter. He called a recess at 10:25 a.m.
Senator Raggio reconvened the meeting at 6:30 p.m. He asked the committee to consider two bills, S.B. 569 and S.B. 570, that had just been referred to the committee. He explained the two measures apply to the Distributive School Account (DSA) and reminded the committee members they had heard an explanation on the floor as to why it was divided into two bills. He pointed out there was nothing different in either measure from what the committee had previously authorized.
SENATE BILL 569: Provides financial support for state school system.
SENATOR RAWSON MOVED TO DO PASS S.B. 569.
SENATOR JACOBSEN SECONDED THE MOTION.
Senator Glomb requested assurance the measure was the same as had been passed in concept earlier by the committee. Senator Raggio replied it was the same except that it had been divided into two bills as explained by the LCB. Mr. Miles explained S.B. 570 deals with changing the dates on which mines must report estimates of net proceeds.
Senator Coffin pointed out he had objected to section 15 of the original bill because he felt it improperly delegated legislative authority to the governor. He asked if the numbering had changed. That provision is now included in section 14. He declared he would have to vote against the bill because of that section.
THE MOTION CARRIED. (SENATOR COFFIN VOTED NO. SENATORS O'DONNELL AND CALLISTER WERE ABSENT FOR THE VOTE.)
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SENATE BILL 570: Changes dates concerning certain statements and meetings relating to taxes.
SENATOR JACOBSEN MOVED TO DO PASS S.B. 570.
SENATOR GLOMB SECONDED THE MOTION.
Senator Coffin asked if the bill included a section similar to section 14 in S.B. 569. Senator Raggio replied it did not. Mr. Miles said it only includes the date-change provision.
THE MOTION CARRIED. (SENATORS O'DONNELL AND CALLISTER WERE ABSENT FOR THE VOTE.)
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Senator Raggio reported he had delayed submitting the action report on S.B. 511 because he had felt there had been meaningful concern voiced during the discussion earlier in the day. He contacted Dr. Paslov and told him of the concern of the committee. The result was a letter from Dr. Paslov (Exhibit F) that he read into the record.
Senator Raggio told the committee if it was the desire to process the bill without the appropriation he would entertain a motion to rescind the earlier action. He would then consider an amendment to the bill that would delete the appropriation but with a letter of intent allowing the department to approach the IFC.
SENATOR RAWSON MOVED TO RESCIND THE ACTION ON SENATE BILL 511 FOR THE PURPOSE OF ELIMINATING THE APPROPRIATION AND ADDING A LETTER OF INTENT.
SENATOR GLOMB SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR JACOBSEN VOTED NO. SENATORS O'DONNELL AND CALLISTER WERE ABSENT FOR THE VOTE.)
* * * * *
SENATOR RAWSON MOVED TO AMEND SENATE BILL 511 BY DELETING THE APPROPRIATION AND INCLUDING A LETTER OF INTENT ALLOWING THE SUPERINTENDENT OF PUBLIC INSTRUCTION TO GO BEFORE THE INTERIM FINANCE COMMITTEE IN THE EVENT SOME FUNDING IS NECESSARY TO COMPLETE THE MODEL.
SENATOR GLOMB SECONDED THE MOTION.
Senator Coffin thanked Senator Raggio for undertaking to investigate the matter with Dr. Paslov.
THE MOTION CARRIED. (SENATOR O'DONNELL AND CALLISTER WERE ABSENT FOR THE VOTE.)
* * * * *
Senator Raggio distributed copies of a BDR (Exhibit G. Original is on file in the Research Library.) relating to unclassified pay for state employees.
BILL DRAFT REQUEST S-2179: Establishes maximum allowed salaries for employees in unclassified service of state and for certain other employees in classified service of state.
At the request of Senator Raggio, Mr. Miles explained the contents of the bill. He called it unusual compared to past measures in that many titles of positions will change on October 1 due to the reorganization. He indicated the legislation will continue the unclassified salaries in existence today as set by the 1991 legislature through the end of September. There will be additions in section 1, primarily for the telemarketing fraud unit and the workers' compensation fraud unit, both in the Office of the Attorney General, for new positions that were not in the unclassified pay bill.
Mr. Miles read the other positions affected from section 1, subsection 2. Senator Raggio asked if those included the new positions for directors under the reorganization. Mr. Miles replied in the negative.
Mr. Miles pointed out the new positions listed in section 2 which adds directors and other changes. He said the major difference is in the titles of the positions, but most of the people affected will remain at existing salary levels.
Senator Raggio voiced his understanding that through the joint action by the two money committees the only increases were those contained in the Governor's budget, primarily the special request for increased salaries for department heads based upon two levels. One salary level was $80,950 and the other was $68,000. He asked the committee members to bear that in mind as they reviewed the list.
Mr. Miles stated virtually all but three positions were recommended in the Governor's budget, with no change for approximately 98 percent. He described the changes that should be included, the first being the addition of another administrative secretary in the Office of the Lieutenant Governor. He suggested the committee add the word "each" to that line item on page 3.
According to Mr. Miles two salary changes should appear under the Office of the Secretary of State, one for the chief deputy and one for the chief of the annual list division. Those changes were made as equity adjustments to align them with unclassified positions in other constitutional offices.
Senator Glomb asked how many new, unclassified positions were being added. Senator Raggio responded all those in section 1 were new. Mr. Miles said the changes occur where some department heads disappear and some new department director positions come into being. He said the new positions are reflected in section 1.
Mr. Miles continued by saying the Office of State Treasurer would add a new deputy state treasurer for cash management, set at the same salary level as the deputy state treasurer for investments.
The next change Mr. Miles designated was the position of solicitor general in the Office of the Attorney General.
Senator Raggio asked Senator Callister for an explanation of the duties of the solicitor general. Senator Callister voiced his understanding that it would be to serve as chief litigator and as the chief litigation administrative official. He recalled the argument had been made that the state is becoming increasingly involved in complex, lengthy litigations which should be assigned to a specific person.
Mr. Miles called attention to the Department of Administration under which a new position will be the director at a salary of $80,950. Senator Raggio noted that was in conformity with the request made to the joint committees by either Scott Craigie, Chief of Staff in the Governor's Office, or by Ms. Matteucci.
Turning to page 5 under Department of Business and Industry, Mr. Miles said the new director would receive $80,950. Senator Raggio interjected the salaries cited by Mr. Miles were all at the maximum authorized. Mr. Miles continued to say the position of the director of the current Department of Commerce would be abolished.
Mr. Miles called attention to the new director position under the State Department of Conservation and Natural Resources at a salary of $80,950. A second associate for film would be added to the Commission on Economic Development.
Mr. Miles said the salary of the superintendent of public instruction, set at $80,950 under the State Department of Education, was a departure from the Governor's recommendation. The Governor had recommended no increase, but the joint committees had determined the directorship should be at the same level as those in the other major departments.
Under the Department of Employment, Training and Rehabilitation the new director would enjoy the same $80,950 salary, Mr. Miles said. All the salaries under the State Gaming Control Board will remain the same. He noted the directorship in the Department of Human Resources would remain at the current salary of $81,294.
Senator Coffin pointed out the incumbent in the Department of Human Resources was leaving, and he wondered if the time was right to change the salary, presently at $81,294, to the same figure as other department heads. Senator Raggio reiterated the figures
represent the authorized maximum salaries and there was no desire to take action that would effectively reduce any salaries.
Mr. Miles recalled that the joint subcommittees had determined that in the cases of other departments that would be organized into a larger department, and then were pulled back out, all the directors' salaries should be set at $68,000. He pointed out that included the Department of Information Services.
Mr. Miles noted the director's salary in the Office of the Military would remain at $68,796, while the salary for director of the Department of Motor Vehicles and Public Safety would cap out at $80,950. The new director of the Department of Museums, Library and Arts would receive a top salary of $68,000 as would the director of the Department of Personnel. He noted the Governor had recommended $65,500 for those two departments as well as for the information services director, but the subcommittee decided upon $68,000 since the information services director was already receiving that amount.
Continuing, Mr. Miles explained the $80,950 salary for the director of the Department of Prisons was consistent with the Governor's recommendation. He noted there would be no change in salaries for the state public defender and the chairman of the Public Service Commission of Nevada. The $80,950 allotted to the executive director of the Department of Taxation was also in line with the Governor's recommendation.
There would be no change for the salary for the executive director of the Commission on Tourism, according to Mr. Miles, while the director of the Department of Transportation's salary would top out at $80,950.
Mr. Miles indicated the salaries listed for the Supreme Court reflect the adjustments made when that budget was reviewed. Jeanne L. Botts, Program Analyst, explained that the first adjustment was for the deputy court administrator who would receive a 4 percent raise to $52,000. The salaries for staff attorneys III and staff attorneys IV were all increased in addition to those for the law clerks who are listed as senior judicial clerk-attorneys in the bill. Ms. Botts indicated the figures delineated are all consistent with the amounts approved for the budget by the committee.
Mr. Miles pointed out the only new position listed under the miscellaneous category is for the technology advisor who will receive a maximum of $75,000 as determined by the joint committees. Senator Raggio interjected the bill approving the position will be coming out of the assembly in amended form.
Mr. Miles described section 3 as a clause added last session to take care of positions inadvertently omitted from the act.
Mr. Miles remarked that the salaries delineated in section 4 would normally be included in a pay-increase bill, but since there is no pay-increase bill this session the figures for classified medical employees were included in the bill. He explained it would set maximum salaries for medical positions within state government, in some cases at more than 95 percent of the Governor's salary, which is the top allowed by law unless otherwise enacted. The salaries quoted are all at existing levels.
SENATOR CALLISTER MOVED FOR COMMITTEE INTRODUCTION OF BDR S-2179.
SENATOR GLOMB SECONDED THE MOTION CARRIED.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Senator Raggio explained the discussion and action that had taken place in their absence on Senate Bill 511 to Senators O'Donnell and Callister. He related the previous action had been rescinded and the bill had been amended to remove the appropriation and to include a letter of intent allowing the department to approach the IFC if funding should be needed to complete the model.
SENATOR O'DONNELL AND SENATOR CALLISTER VOTED AYE ON THE MOTION TO AMEND AND DO PASS S.B. 511.
* * * * *
Senator Raggio told them the committee had also taken action on S.B. 569 and S.B. 570, the two bills relating to the Distributive School Account.
SENATOR CALLISTER VOTED AYE ON S.B. 569. (SENATOR O'DONNELL ABSTAINED FROM THE VOTE.)
* * * * *
SENATORS O'DONNELL AND CALLISTER VOTED AYE ON S.B. 570.
* * * * *
SENATE BILL 568:Authorizes expenditures by agencies of state government.
Senator Callister stated he had asked for amendments to S.B. 568 to accomplish a series of reductions. He admitted it was still unclear as to which dollars would come from the authorization act and which would come from the appropriation act. He said the bill drafters were working on the proposals he had to make. With permission of the chair he agreed to summarize his proposals, which are listed on Exhibit H.
Senator Callister verbalized the "lengthy introspection and consideration and review" that had led him to make his proposals, saying:
It is my particular sense of things that we will, based on present course and proposals for closing this session, be confronted with an approximately $100 million deficit on day 1 of the 1995 session.
Senator Callister explained how he had arrived at those calculations, with some help from staff. He recounted:
As the chair and members of this committee are aware the balance will actually be $13 million upside down on that date. The budget balances as presented to us, I would suggest, by the executive only midstream, only in the midway point of the biennium. It does not balance at the end of the biennium. So there's $13 million that we're out.
Secondly, it's my understanding that the budget scenario for closing incorporates the $30 million one-time pre-collection of the insurance premium tax, and I cannot support that measure. I've spoken against it and will vote against it, but it's my understanding that it's likely to pass.
Thirdly, I am now told that the latest date at which we are most likely to cease seeing the benefit of the medical provider tax will be January 1995, and my colleague from southern Nevada may stand to correct me on that....
If you add those three together you've got...$93 million that we're upside down when we walk in the door [in 1995], and I cannot in good conscience support a budget that builds so big a trap for those of who are returning and those of us who might be lucky enough as to not return, because I would suggest, as I've indicated to the chairman, I am going to do everything in my power to guarantee that his party is in control when we have to deal with this issue next session. I have no desire to be around when the tough decisions have to be made of that magnitude.
But let me tell what the three options are. And I think the budget has been artfully, but intentionally crafted to leave us with but three options. Or unartfully crafted, depending on which budget office you're referring to.
But quite frankly I think option one is, of course, to make reductions. I point out, of course, that that $100 million isn't new spending. That isn't for third-grade class-size reduction. That isn't for teacher salaries, which'll certainly be an issue as will all state employees' salaries that will have gone some 8 years without consideration. It isn't for more funding for health benefits for our state employees. It isn't for higher ed, get back to the formulas. It isn't for any of the niceties that I think all of us would want to support.
It is simply to keep the ship of state afloat; we need that $100 million.
I also would...suggest that I cannot buy into some of the presumptions that include such absurd ideas as utilizing the 5 percent inflation rate for costs of medical inflation over the biennium. I think we almost absolutely will be confronting a shortfall and hence an application for a supplemental from the Medicaid folks. I think we'll see the same supplemental requests for the distributive school fund.
I based that on the last time we had some 20,000 rooms dumped onto the Nevada marketplace. When that happens you get not the 60,000 job applicants for the 60,000 new jobs, but about 100,000 job applicants, many of whom stick around and end up in your safety net and in your schools.
So I think the $100 million is a modest number, not an overinflated one.
Senator Callister continued:
Again to the three options to respond to that. One would be to make reductions, which is what my proposal will be now as opposed to then, because I can only get you half-way there, I would suggest.
Secondly is to face the extraordinary notion of having a need for $100 million in new revenues, and yet no dialogue in the interim as to how to generate those revenues from some taxable source. And it's my understanding, at least at present, no consideration is being given to an interim study with the exception of, perhaps, Senator Rawson's proposal for a study on how we fund education.
Senator Glomb interjected she had requested a study on that. Senator Callister responded, "Well, I think my statement stands that no consideration is being given to making those the final studies."
Senator Callister asserted:
The third option is the one that I believe is reason for the building of this $100 million trap. And that is to compel us, as was promised more than 3 years ago in the memorandum provided by the American Nuclear Exchange Council, to compel us to our knees, and then, hence, adopt the age-old Nevada notion of "don't tax you and me, tax the fellow behind the tree," which turns out to be an acceptance to the nuclear waste proposal and whatever source of revenue that would generate.
I believe that's the reason for the press coverage of late. I believe that's the reason for the resolution that will be in front of us tomorrow or the next day, and I also believe that very cleverly the box has been built.
Now, my suggestion, just for me, and...the political pragmatist in me understands only too well what the likely success rate would be on most of these proposals, but I'm going to make them nevertheless. In that context, and because I believe we're building our budget on a house of sand, I believe we're building our budget on borrowed time and borrowed money, I would suggest the following reductions, which I would suggest can generate about a total of $45 to $50 million in reductions from this budget cycle, and hence prevent, not all of the calamity that awaits us, but some significant portion of it.
And in looking through the budget, and in giving consideration for the myriad of ways that we can do this, the proposal that's always made is "just take 2 percent off of everybody's budget." But...if I thought that was my job, you should just buy a calculator, not elect us. That's not a policy decision, that's the absence of policy considerations.
My suggestion is that what's happened in the last 10 years to this state is just as simple. We've gone from being perhaps a partially-rural and partially-urban society to an overwhelming urban society. Nevada is today, based on the most recent census figures, 90 percent urban, 10 percent rural. We're using those definitions. By those same definitions we are more proportionately urban than is California, than is Utah, than is Arizona, most of our neighboring states.
And yet we perpetuate budgetary politics that disproportionately subsidize, at urban expense, a rural lifestyle. A rural lifestyle that is a lovely, wonderful lifestyle that I respect, that I wish all of us could enjoy. But for me and my constituents I can no longer justify the extent of the subsidies.
And so I've presented you today, and will present my amendment to the authorization/appropriation acts, a series of reductions.
Senator Callister offered to "walk through" the proposed reductions for the committee. He pointed out he was only going to recommend the adoption of a few of the items on the list. He said:
If there are no General Fund dollars, then I don't think it's an appropriate request to make that we eliminate or reduce it. And if there are even a reasonable percentage of urban dollars, then I think let's take that off the table for purposes of my consideration.
Senator Callister proposed to target specific items from Exhibit H. The first he targeted was number 2 on the list. He remarked:
My suggestion would simply be that there are many of my constituents who would love to have, and would benefit from, a state-subsidized senior services program. But we have that supplement for exclusively rural Nevada and that 10 percent of our population at the expense of the balance of the state.
Senator Callister next called attention to items 5 and 6. He said:
I am not certain yet, and will not know until tomorrow, to what extent the room tax, which funds the Rural Grants and, in item 6, the Transfer to the Ely Depot, I'm uncertain to the extent [to] which that room tax is generated locally. If it is, then I would suggest that it be taken off the consideration for purposes of my consideration, so within that $25 million I'm not including it at this point in time.
Senator Callister turned to items 8 and 9 in the memorandum. He averred:
There are many of my constituents who would love to have, and benefit from, a state-dollar subsidized rural mental health clinic. But in my county, either as a result of its having most of the population that needs these services, or as a result of other funding, we don't benefit from a targeted-rural subsidy to this extent.
State Fire Marshal. $209,000 and $210,000. As I'm certain most of us are aware, a crucial service. I'm not suggesting that any of these services aren't crucial. I am suggesting that in times of desperate need, in times in which we're prepared to deficit-fund this state by $100 million, we ought not [to] be subsidizing simultaneously an urban need which, in the urban communities is funded by the urban communities, not state dollars.
Senator Callister moved to item 15. He stated:
Predatory Animal and Rodent Control. There is a percentage calculation here to be made that indicates 85 percent of these activities are devoted exclusively to the rurals. $351,000 in the first year, $351,000 in the second year. Obviously I have the same sense there that I have indicated elsewhere.
Senator Callister pointed to budgets for the Agricultural Experiment Station and Cooperative Extension Services, items 16 and 17, saying:
Wonderful beneficial programs, Mr. Chairman. But programs which, if we had a functional equivalent of them in an urban community, would be something along the lines of compelling the universities to offer programs to enhance, to this level, $8 million a year in one instance and almost $8 million in the second instance, how gaming could better compete against other gamers. A private, free-market function we expect in some portions, but simply are willing to subsidize in other segments of our economy, a subsidization I do not believe we can afford, given the fact that they generate, as I understand it, less than 10 percent of the jobs in the state.
Not suggesting that it's not a valuable service in any instance, only that the state's subsidy of what is a purely localized rural benefit ought to be reconsidered.
Senator Callister read item 18, the University of Nevada Medical School budgets. He said:
Perhaps the harshest of all...$260,000 each year, again clearly something that's crucial to those folks. But I don't have, and I don't see planned in Gershin Park or in East Sparks some equivalent state-subsidized health care system. We only see that benefit provided in a rural context, and I think it's time to reconsider that.
Finally, two other components not on this list, and that...would be the $16 million that I think we've already made a decision wastefully and needlessly based on all the body of testimony before us to extend rural honor camps. As I believe every single member of this committee and this house knows not because the bedspace is needed, but because we want to make rural counties feel good and keep them economically whole, a laudable, meritorious goal in flush economic times. We are not in such times.
Additionally there's a $3 million bonded indebtedness amount that could be reduced by not going forward with the prison camp renovations that would not be necessitated by the 2-year closure of those beds.
Senator Callister added, "for a total of $19 million between the $16 million operational costs and the $3 million for bonded indebtedness." He concluded:
Collectively, somewhere in the neighborhood of $40 to $45 million. What doesn't this consider?
First and foremost, this gives no consideration to what is perhaps the most obvious rural subsidy, and that is, of course, the whole notion of a guaranteed SCCRT [Supplemental City-County Relief Tax] payback system in which we begin our process of tax collection and distribution with the presumption that certain counties will never pay for themselves, will never pay for their own existence. And so we agree collectively, we'll simply subsidize those beneficiaries of urban largesse at a time when there is no money, and apparently no will to consider that.
Nor do we consider the $25 million in water bonds issued but not sold which are almost entirely to benefit rural, small water projects. Again a very laudable goal, but one may ask why should a Washoe County resident be compelled to participate in a property tax that puts dollars in a water system outside of his urban area. I would well imagine that if these questions were put to most of our constituents in that context we would get a far different response than that to which we are accustomed to presuming, nor does this consider the A.B. 170
[ASSEMBLY BILL 170: Requires issuance of bonds to provide revenue for grants for preservation and protection of certain historical buildings.]
proposals, which, as much as I love historic preservation, most assuredly in whatever incarnation they finally take will disproportionately fund those projects in rural Nevada at the expense of property taxes raised -compelled - by us in counties that just said no to more property taxes for cops on the street.
Senator Callister continued to say:
If this were a fiscally fat year perhaps I could turn a blind eye to all of these proposals and say, hey, let's go right down the same merry path we have. But I cannot do so under the circumstances in which we find ourselves. Many will say this is some lack of compassion on my...part. I would suggest it has more to do with the fact that I've decided never to run for statewide office. But additionally I would suggest that we need to reconsider in a much more critical view how we operate this state, where the money comes from, who pays it, as Chairman Raggio is quick to remind us, and where it gets spent.
I would suggest there are at least $40 million of rural subsidies of the General Fund that I cannot support.
Senator Raggio called for additional discussion on S.B. 568.
Senator O'Donnell inquired, "Did I hear you say that the Governor's proposal for the insurance premium tax is part of the box of the creation? Are you saying that he had a hand in creating...this deficit that brings the Nuclear Energy Council into this thing?"
Senator Callister replied:
Whether it's willingly or thoughtfully or not, I would suggest that to use $30 million that...clearly ought to be earmarked as one-shot money for continuing purposes in the budget creates [the box], and that's the problem.
Senator Raggio called for a motion on S.B. 568.
SENATE CALLISTER MOVED TO AMEND AND DO PASS S.B. 568 WITH THE DELETIONS PROPOSED IN EXHIBIT H.
SENATOR GLOMB SECONDED THE MOTION.
Senator Coffin inquired if Senator Callister had deleted the portions from item 17, an appropriation of approximately $4 million per year for the cooperative extension services, amounts spent in the two urban counties. Senator Callister acknowledged he had not made a distinction as to whether a rural community was located in either Washoe or Clark County or another county.
THE MOTION FAILED. (SENATORS RAGGIO, RAWSON, JACOBSEN, O'DONNELL AND COFFIN VOTED NO.)
* * * * *
SENATOR RAWSON MOVED TO DO PASS S.B. 568.
SENATOR JACOBSEN SECONDED THE MOTION.
Senator Coffin asked for an explanation of the enabling language in the measure. Mr. Miles responded the language is included in the general appropriations act that will be coming from the assembly and it is not included in S.B. 568. Senator Coffin indicated his belief some counterpart to percentages of reduction were included in the bill. Mr. Miles replied there was no such provision in S.B. 568 and he did not feel it would be necessary.
Senator O'Donnell admitted it is difficult to be in a situation with limited funds. He pointed out he has participated in two legislative sessions in which there were surpluses in excess of $100 million. He suggested it is not a matter of prudence to "spend the well dry" every time money is available. He opined the legislature should consider increasing savings during good years so that money would be available during periods of fiscal downturns without the necessity to raise taxes.
Senator Callister announced he would be voting no on the measure for the above stated reasons. He declared he would also vote no on the appropriations authorization act because he has been told that the state is now utilizing a projected growth in sales tax of 4.7 percent in the first year and 4.5 in the second year as compared to the Governor's projections of 3.3 percent and 2.8 percent respectively.
Senator Raggio requested a response from Mr. Miles. Mr. Miles explained the authorization act does not include General Fund money except for the State Gaming Control Board. He said he, the budget director and the assembly fiscal analyst met two or three times in the last two weeks to address the concerns of the Governor regarding the sales tax projections. He reported the analysts had agreed to reduce the projections to 3.5 percent in each year of the biennium, and those were the levels used for calculations of the DSA bill.
Senator Callister pointed out the legislature and Governor were apart by just .25 percent at the last session for the first year of the biennium. He asserted, "The fallout from that was rather substantial." He computed there is about a .75 percent difference existing for the present year. He charged those figures indicate a level of risk.
THE MOTION CARRIED. (SENATOR CALLISTER VOTED NO.)
* * * * *
Senator Raggio notified the committee to be prepared to take action on the unclassified bill in the morning.
There being no further business before the committee, Senator Raggio adjourned the meeting at 7:30 p.m.
RESPECTFULLY SUBMITTED:
Judy Jacobs,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE:
??
Senate Committee on Finance
June 28, 1993
Page 1