MINUTES OF THE
SENATE COMMITTEE ON NATURAL RESOURCES
Sixty-seventh Session
May 19, 1993
The Senate Committee on Natural Resources was called to order by Chairman R. Hal Smith, at 8:39 a.m., on Wednesday, May 19, 1993, in Room 224 of the Legislative Building, Carson City, Nevada. Exhibit A is the Meeting Agenda. Exhibit B is the Attendance Roster.
COMMITTEE MEMBERS PRESENT:
Senator R. Hal Smith, Chairman
Senator Dean A. Rhoads, Vice Chairman
Senator Ernest E. Adler
Senator Mark A. James
Senator Joseph M. Neal, Jr.
Senator Dina Titus
COMMITTEE MEMBERS ABSENT:
Senator Thomas J. Hickey (Excused)
STAFF MEMBERS PRESENT:
Caren Jenkins, Senior Research Analyst
Rayanne Francis, Senate Committee Secretary
OTHERS PRESENT:
Verne Rosse, Nevada Division of Environmental Protection
Jolaine Johnson, Nevada Division of Environmental Protection
Janet Arobio, Member of the Public
Carole A. Vilardo, Lobbyist, Nevada Taxpayers Association
Ray Bacon, Lobbyist, Executive Director, Nevada Manufacturer's
Association
John McGannery, Member of the Public
Joe Quinn, Chief of Operations, Department of Emergency Management
Senator Smith opened the hearing on Senate Bill (S.B.) 442.
SENATE BILL 442: Clarifies that transportation of certain hazardous substances is exempt from certain provisions.
Senator Smith advised it had come to his attention that Assembly Bill (A.B.) 117 had been passed, and is identical to S.B. 442. He suggested, therefore, that it would be appropriate to indefinitely postpone S.B. 442.
ASSEMBLY BILL 117: Provides for coordination of regulatory activities relating to hazardous materials. (BDR 40-365)
Jolaine Johnson, Nevada Division of Environmental Protection (NDEP), provided testimony regarding S.B. 442. Ms. Johnson advised Senator Smith that her organization was not aware of another bill containing the provisions of S.B. 442. She further advised that Assembly Bill (A.B.) 189 was passed, and this bill provides an exemption for the agricultural use of anhydrous ammonia and for mining activities. However, when the committee considered that bill it was recognized that the issue over transportation had not been addressed.
ASSEMBLY BILL 189: Exempts from regulation certain uses of hazardous substances. (BDR 40-257)
Senator Smith agreed that this was correct, and invited Ms. Johnson to proceed with her testimony on S.B. 442. Ms. Johnson stated the original legislation read that hazardous substances transported through or within the state are exempted. She stated concern regarding the interpretation of this law to read that once a hazardous substance has been transported or if it will be transported, those substances become exempt from the law. Mr. Johnson's organization does not believe this is the intent. Rather, the intent is to exempt the actual transportation of hazardous substances. Those substances, when they are at a facility being handled, stored, and produced would be subject to the chemical catastrophe prevention provisions.
Senator Smith asked if this was, in essence, addressing Senator Hickey's concerns.
Ms. Johnson replied in the affirmative. She stated that during the discussion of (A.B.) 189, this issue was raised in terms of grammatical error which has caused the division a problem in interpretation of the law.
Senator Neal advised, as Senator Smith had stated, that S.B. 442 is an identical bill to (A.B.) 189, passed by the committee on April 16, 1993. That bill was amended to say "any hazardous substance, while being transported, within the state." He asked for confirmation that Ms. Johnson's request is to change the language again to read "the transportation of any substance."
Ms. Johnson stated her recollection that the bill had passed the assembly without the provisions for the changes in transportation.
Senator Neal agreed, and advised the original language was "any hazardous substance transported within or through this state which is regulated by the state or the United States Department of Transportation."
Ms. Johnson agreed, but stated the bill did not read in this way when it passed the Assembly.
Senator Neal stated the Senate Committee on Natural Resources had offered an amendment stating "any hazardous substance while being transported." This was done to allow someone to look at what was being transported. He stated that S.B. 442 is essentially the same, and both bills amend Nevada Revised Statutes (NRS) 459.3814.
Ms. Johnson recalled that in order to pass A.B. 189 without it having to go back to the assembly, it was passed out of the Senate Committee on Natural Resources without the transportation amendment.
Caren Jenkins, Senior Research Analyst, advised that A.B. 189 did pass out of the committee without the amendment. Senator Hickey had requested time to review the transportation issue involved. This committee requested a bill draft to make that change, feeling it was important enough for the committee to discuss as a whole, but did not wish to hold up the previous bill. S.B. 442 is the result of that bill draft request.
Senator Neal asked the disposition of A.B. 117.
Senator James advised he recalled the same action related by Ms. Jenkins.
Senator Smith advised Ms. Johnson that the committee would pursue this issue in depth in a future work session. He asked for and received confirmation that Ms. Johnson was the only person from the Division of Environmental Protection to testify on S.B. 442, and closed the hearing.
The hearing was opened on Assembly Bill (A.B.) 116.
ASSEMBLY BILL 116: Authorizes proration of annual fee paid by regulated facilities for hazardous materials.
Vern Rosse, Nevada Division of Environmental Protection, offered testimony. Mr. Rosse advised A.B. 116 was significantly changed from its original form. The bill had to do with collection of fees and coordination of collecting information. An amendment reflected clean-up legislation to Senate Bill (S.B.) 641 of the Sixty-sixth Session, the Chemical Catastrophe Prevention Act. He advised A.B. 116 removes obsolete language in existing statutes which no longer applies, and in subsection 2 of section 1, specifically provides for pro-ration of the annual fee. Mr. Rosse reviewed each section of the bill.
Ray Bacon, Lobbyist, Executive Director, Nevada Manufacturer's Association, provided testimony on A.B. 116. He advised this bill came out of the committee to study Assembly Concurrent Resolution (ACR) 79. The intent of the original bill was to force consolidation of tax collection. By the amendments, the original intent has been totally violated. Mr. Bacon stated his association still supports the original version of the bill.
Carole A. Vilardo, Lobbyist, Nevada Taxpayers Association, testified in opposition to A.B. 116, as first reprinted. She stated that, having followed the interim study, one of the provisions of concern to her association was that the association be able to mitigate the amount of paperwork and fee collection on business. She stated the original intent of A.B. 116, put forth and approved by the interim committee, was an attempt to consolidate the collection of the fee into the Department of Taxation and thereby simply forms and reporting. She advised the bill, as reprinted, changes the fees and pro-ration. She could not address the need for the change from the word "volume" to "quantity", as this is an area outside her expertise. She stated, however, her association has great problems with so totally changing the language of the original bill as to destroy the original intent.
Senator Neal read from A.B. 116, First Reprint:
The owner of a regulated facility shall pay to the division an annual fee based on the fiscal year. The annual fee for each facility is the sum of a base fee set by the state environmental commission and any additional fee imposed by the commission pursuant to subsection 2. The annual fee must be prorated and may not be refunded.
Senator Neal stated he did understand the objection to the section.
Ms. Vilardo replied her association has no problem with the proration of the fee. One problem they did have was that much discussion went into setting the $100 fee. This is one of the major changes in the reprint. It removes the specificity of the fee and allows a fee to be set by the department. She advised the proration should apply to the $100 fee, not on an unknown quantity.
Senator Neal asked if the problem was in not knowing the amount of the fee.
Ms. Vilardo replied this is definitely a problem, but not the only one. Her association's largest problem is that collection was not turned over the Department of Taxation, and this provision has been totally eliminated from A.B. 116. She wanted the committee to understand that her association is not opposed to regulations governing what is necessary to make work places, employees and residents of the state safe. She stated her association has been involved in meetings with the Department of Taxation and the State Emergency Response Commission (SERC). The regulatory burden, particularly in the area of hazardous materials, has been tremendously increased by various divisions within the state and by local governments. A.B. 116 was an attempt to consolidate some of the collection mechanisms.
Senator Neal asked how the public good would be better served by having fees go to the Department of Taxation.
Ms. Vilardo replied the public has to respond to the payment of the fee and the reporting of the paperwork. She stated that businesses currently pay a business license tax, sales and use tax, and diesel fuel tax, all to the Department of Taxation. The idea of A.B. 116 was to consolidate collection and reporting so that possibly in 3 to 5 years as many of the reports and fees as possible would be generated into the Department of Taxation. She advised the state of Washington, for example, has a two-page form by which is remitted sales tax, Washington business and occupational tax, and gasoline tax and sales tax.
Senator Neal asked why the assembly amended the bill to eliminate these provisions.
Ms. Vilardo advised that when her association supported A.B. 116 and other bills with similar provisions, she was not aware of a problem. The next thing she saw was the reprint on A.B. 116.
Mr. Bacon added that in 1992, a member of his association wrote 99 checks to state government. He stated this seemed rather excessive for a company with 150 employees. His association believed by moving toward consolidation, fees are paid to an agency which will more rapidly move the funds to an interest bearing account. He stated he believed there is a substantial gain in state net revenues by consolidating as many fees as possible and getting a specialized organization for collection. He stated he believed several million dollars are at stake, with no net increase to the regulated industry.
Senator Neal advised that before the committee acts on A.B. 116, the taxation commission should be represented, and testimony heard.
Senator Smith advised the commission was contacted, however, their representative stated the bill as written did not require his presence. Senator Smith agreed the testimony heard at this meeting pointed the necessity of further pursuit of the commission's testimony.
Ms. Vilardo advised she had conversations with John P. (Perry) Comeaux, Department of Taxation, when the issue was first raised, and relating to other bills proposing transfers of funds. She stated anyone working with the Department of Taxation is cognizant that the department has to be advised of the additional workload which would arise as a result of proposed legislation. She advised Mr. Comeaux was totally supportive of A.B. 116 in its original form.
Senator James agreed with the concept of consolidating fees and sending them to the Department of Taxation. He wanted to understand Ms. Vilardo's objection to setting out the fee in the reprint of A.B. 116. He asked for confirmation that she had no objection to elimination of the $100 fee and the insertion of the base fee.
Ms. Vilardo stated she had strenuous objections to the insertion of the base fee.
Senator James asked for and received confirmation that these changes were not proposed in the original bill, and that Ms. Vilardo objects to the fee collection as proposed in the reprint of the bill. He further asked for and received confirmation that the original bill did not change the way the fee was calculated, but also did not address the problem. He asked if Ms. Vilardo was asking the committee to change the bill to set forth the exact fee.
Ms. Vilardo explained she would like to have the fee go back to the Department of Taxation, that the $100 fee be specific, that the proration remain, and to determine whether it is better to have "volume" or "quantity."
Senator James stated the reprint proposes to remove the $100 fee, while the original bill proposes to keep this fee and pay it to the Department of Taxation. He advised, however, that the original bill provided a method of calculating the fee, so as to not know the exact amount of the fee. This was due to language, "as set by the commission," "on a graduated basis," "based upon the amount of hazardous substances" and "such fee as is necessary to allow the division to carry out its responsibilities." He asked for confirmation that this was Ms. Vilardo's objection.
Ms. Vilardo reiterated that when fee issues were raised in the 1991 legislative session, regarding Senate Bill (S.B.) 641 of the Sixty-sixth Session, her association was very much on the peripheral of that bill and was not involved in testimony. Committee testimony regarding S.B. 641 of the Sixty-sixth Session included the discussion of the $100 fee to set up the initial mechanism needed, and then having the Environmental Commission set a fee which would take care of the remainder of the regulatory obligation provided for in S.B. 641 of the Sixty-sixth Session. She stated she did not know the best way to handle the problem. She advised the $100 fee bothered her, if, based upon testimony regarding S.B. 442, it will be subjected to some machinations which could add up to $1000. She added she would certainly be open to a better way of insuring that the regulatory fee is computed, calculated or prorated, and to allow the agency to do what is necessary to absolutely regulate the fee. However, as a general statement, agencies which have fee authority and take a fee for purpose of regulation, operational expenses will soon be built into the fee. This is why the $100 had a comfort level for her.
Senator James stated there are two fees. The $100, removed from A.B. 116, but remaining in the old bill, is paid one time. The other fee, under existing law and the old and reprinted A.B. 116, is calculated on the basis of the amount of hazardous materials, and the amount the commission deems necessary to keep the division going. He agreed that the amount of the fee should be more clearly stated in the law. However, this is a much broader endeavor than what the bill drafters attempted, and has never really been broached.
Ms. Vilardo advised another bill will address this in another area.
Ms. Johnson wished to verify that Senator James had a clear idea of the bill. She stated the $100 was an initial fee to get the NDEP started, until facilities actually regulated by this program were identified. She advised the annual fee had already been established by the State Environmental Commission in an amount necessary to support NDEP activities related to this regulation. By eliminating the first paragraph of A.B. 116, the facilities are not being asked for additional fees. The NDEP did not believe it was necessary at that time to continue looking to the facilities, listed in paragraph 1, for a $100 fee on a continuing basis. The regulated community had already been identified and the focus for fees was on that community. She stated the NDEP supported keeping the flexibility for establishing that fee with the State Environmental Commission, because each year the resources will increase and the fees will, therefore, have to be adjusted to support the activities, until a certain year when the expenses level out.
Senator Smith confirmed there was no further testimony, and advised A.B. 116 would be considered at a future work session.
The hearing on was opened on Assembly Bill (A.B.) 124.
ASSEMBLY BILL 124: Authorizes director of the division of emergency management of the department of the military to facilitate development of a comprehensive, coordinated approach to emergency management.
Joe Quinn, Chief of Operations, Division of Emergency Management, provided testimony in support of A.B. 124, and the amendment. He requested the committee to recommend To Do Pass A.B. 124, as amended.
Mr. Ray Bacon advised A.B. 124 in the first reprint is substantially different than the original version. He stated the sections added essentially absorb the functions of State Emergency Response Commission (SERC) into the Nevada Department of Emergency Management (DEM). He advised SERC has been a very good organization, fundamentally functioning very well with regulated industry, and has become an excellent forum. He stated knowledge of budget problems in combining of the functions, but because of the federal statutes the functions referred to in section 1, subparagraph 4, of A.B. 124 should remain in SERC as a specific function of that agency. He advised in his past experience, SERC had been a very responsive, receptive agency, and the DEM's track record is nowhere near as good.
Senator Hickey asked who sits on the board of SERC.
Mr. Quinn replied the approximately 35 member board of SERC consists of Senator Jacobsen, Assemblyman Garner, heads of
several agencies, and people from the private sector.
Ms. Vilardo advised other representation on the SERC board is the Local Emergency Planning Commissions. Therefore, an excellent dialogue has taken place. She stated some concerns regarding paperwork were addressed by the SERC board meeting with some of the subcommittees of the Assembly Concurrent Resolution (A.C.R) 79 interim committee. These meetings dealt with concerns of reduction of paperwork, consolidation of fees, and being more user-friendly to small businesses having no idea they were dealing with hazardous materials, and who were being caught in regulations. She gave the example of a dry cleaner who might be using perchlorate. Ms. Vilardo's organization realized this was happening and began monitoring the situation. She advised the SERC subcommittees had been extremely responsive to some of the bills which came out of the study.
Senator Rhoads asked if Ms. Vilardo supported A.B. 124, as amended.
Mr. Bacon responded that they are against the A.B. 124, as amended. He stated that, as he reads the intent, the amended bill fundamentally makes the functions of SERC part of DEM. He stated SERC has been a very responsive, responsible agency, however DEM's record is not so clean and pristine.
Senator Smith asked for and received confirmation that Mr. Bacon and Ms. Vilardo supported A.B. 124 in its original form.
Ms. Vilardo stated her organization has one concern even with the original version of the bill, as it shows no fiscal note. She referred to section d of the reprint, and section 4 of the original. She stated these sections say the same thing, which is:
Restore the operation of vital community life-supported systems.
Ms. Vilardo assumed this refers to services essential for the transportation of people. She stated the problem is in the following phrase:
. . .and return persons and property affected by an emergency to a condition that is comparable to what existed before the emergency occurred.
She assumed, because no parameters are set, that this refers to private property. She asked who is responsible for doing this, since all language refers to the same division. She questioned the language, believing additional clarification was needed. If the language reverts to a governmental entity, a fiscal note is needed. She further stated the language is vague and does not state to what degree the return goes back.
Senator Neal stated he understood A.B. 124 to authorize the Director of the Division of Emergency Management of the Department of the Military to facilitate and develop a comprehensive and coordinative approach to emergency management. He advised the bill further states the director may suggest activities designed to accomplish this. Therefore, there is by no means finality in what the director suggests. The suggestions are subject to change by the person or agency to whom the suggestion is made.
Ms. Vilardo referred to line 22 of the reprint of the bill. She read:
. . .for the mitigation of, preparation for, response to and recovery. . .he may suggest activities . . .to
She stated she would like to see a better delineation and definition of the property.
Senator Neal reiterated the language states, "he may," which means there is no finality in what is suggested. He envisioned a meeting in which the director reports to someone.
Ms. Vilardo stated she was very gun shy because of some of the things which have happened with regulations which have come down from various agencies. She stated that, looking at it through Senator Neal's eyes, the "may" would suffice. The only concern would then be how these things would be suggested when the hearings took place. She did agree with Mr. Bacon's opposition to putting SERC responsibilities within the DEM.
Senator Hickey agreed with Senator Neal, however he saw the provisions of the bill as a cooperation versus a hands-off operation. He stated it made sense that the process of setting up a system for emergency management would include recovery, and who is going to pay for the spill or whatever may occur. He viewed the provisions of the bill as preparation, rather than a mandate for the director to issue amounts of fees.
Mr. Bacon stated his assessment of the language in subparagraph 4 was that it would be clearer to specify that the activity to facilitate development of comprehensive coordinative emergency management plans should coordinate through local emergency planning committees. He stated these committees were set up to do that through the state's emergency response committee, and work very well. He believed the fact that those committees were intentionally left out appears to be a conscious intent to either destroy or go around those agencies. This is his concern with the bill.
Senator Hickey stated that the language could be amended to read "in cooperation with."
Senator Neal asked if there is not a general process in business whereas if a project is going to institute a change, someone is put in charge of the project. He stated this is what A.B. 124 is doing.
Mr. Bacon stated this is probably true. His primary concern is the appearance of a conscious effort to go around something which is currently working.
Senator Hickey believed an amendment could be developed to address everyone's concerns.
Ms. Vilardo asked for and received permission to make an additional statement regarding A.B. 116. She stated it was her understanding that the $100 fee was an initial fee paid any time a company was identified. She added that if this was a one time, initial set up fee which had a death date in it, or by intent was supposed to end after initial funding, she would have no objection to that specificity being removed.
Senator Smith confirmed that the committee understood Ms. Vilardo's concern.
Mr. Quinn stated A.B. 124 recognizes a legal definition of comprehensive emergency management which is used universally. He advised, regarding SERC, the committee should be aware that the DEM is the staff of SERC. Therefore, there exists no conflict, and in fact the DEM supports SERC's activities. He referred to previous testimony regarding any conflict in the understanding of what A.B. 124 does versus what SERC does. He explained SERC committees are required by the public law, which funds SERC, to oversee planning for hazardous materials emergencies, specifically and individually. The DEM, on the other hand, oversees and coordinates planning for all emergencies. Therefore, there is no conflict. He stated the DEM, pursuant to SERC's requirement, assists local emergency planning committees in that process of creating hazardous materials plans, and in assuring they meet the minimum requirements of that law. He advised he is aware of no regulatory powers within the DEM.
Senator Smith confirmed there was no further testimony on A.B. 124, and closed the hearing.
Senator Titus advised the committee that the subcommittee for Senate Bill (S.B.) 402 has met and drafted the amendments to the bill.
SENATE BILL 402: Imposes restrictions and requirements upon care and sale of certain animals. (BDR 50-24)
Senator Smith advised the bill and the amendments will be heard by the committee at an upcoming work session.
There being no further business before the Senate Committee on Natural Resources, Chairman Smith adjourned the hearing at 9:24 a.m.
RESPECTFULLY SUBMITTED:
Sherry Nesbitt,
Committee Secretary
APPROVED BY:
Senator R. Hal Smith, Chairman
DATE:
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Senate Committee on Natural Resources
May 19, 1993
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