The Committee on Judiciary was called to order at 8:03 a.m., on Friday, February 5, 1999. Chairman Bernie Anderson presided in Room 3138 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mr. Bernie Anderson, Chairman

Mr. Mark Manendo, Vice Chairman

Ms. Sharron Angle

Mr. Greg Brower

Ms. Barbara Buckley

Mr. John Carpenter

Mr. Jerry Claborn

Mr. Tom Collins

Mr. Don Gustavson

Mrs. Ellen Koivisto

Ms. Sheila Leslie

Ms. Kathy McClain

Mr. Dennis Nolan

Ms. Genie Ohrenschall

GUEST LEGISLATORS PRESENT:

Assemblyman Lynn Hettrick, Assembly District 39

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

John S. Williams, Collections Supervisor, Las Vegas Municipal Court, Security and Enforcement Division

Harvey Whittemore, Attorney At Law, Lionel Sawyer and Collins, Citibank (Nevada) NA

For the record there was a problem with tape number 1. The court/confer-corder automatically transferred to tape number 2. The only portion of the meeting not recorded was the chairman’s call to order.

Following roll call, the committee proceeded with discussion on A.B. 24.

Risa B. Lang presented an historical review of A.B. 24. The Subcommittee on Fees, Fines, Forfeitures and Administrative Assessments had recommended the bill. It was one of two pieces of legislation recommended to assist the courts in improvement of collection procedures. The bill would allow courts to accept payments made by credit card and debit card. The cardholder would be required to pay the fee associated with the use of the credit or debit card up to a certain amount not to exceed 4 percent of the total amount paid through use of the card.

Assemblyman Carpenter said it appeared the way the bill was written the courts and local governments would have to assume the additional charges if a credit card company charged over the 4 percent. He was not sure that was the subcommittees intent.

Chairman Anderson asked Ms. Lang if she had an observation relative to the particular section on the question regarding 4 percent of the total amount paid to the court. He questioned whether it would limit the amount of money paid to the court and not the amount collected. She said it referred to how much the court would be required to pay for use of the credit card. Section 2 of the bill had language in place for local governments and she believed they presently paid for those charges. Local governments could not impose the charge on people who used the credit card. A limit was placed on the amount the courts would be allowed to charge.

John Williams, Collections Supervisor, Las Vegas Municipal Court, Security and Enforcement Division, testified in support of A.B. 24. He requested clarification concerning fees that could be charged. The courts used credit and debit cards. It collected fines and fees; however, the bank charged two fees, a credit card fee and a processing fee. Las Vegas Municipal Court wanted the ability to collect both the fee charged by the issuer of the credit card and the processing fee charged by the bank, not to exceed the amount being charged.

Mr. Anderson reiterated Mr. William’s suggested language in section 1, line 11 of subsection 2 of the bill, which referred to the use of the card, be changed in some manner to reflect "or administrative charges and processing charges of the bank."

Mr. Williams said that was correct for fees charged by both the issuer of the card and by the banking institution. The court would also agree with Mr. Carpenter regarding the need to have a 4 percent cap if the court did not charge in excess of what the credit card issuer and the bank processing fee charged.

Chairman Anderson asked Mr. Williams if the reasoning for that was because the person who offered the credit card for payment would know the fees involved and that the credit card instrument was a full service charge. Mr. Williams said that was correct, the bank and the court were aware of the fees.

Mr. Anderson asked if those fees were charged on a regular basis. Mr. Williams responded by saying yes, but the charge varied from MasterCard to Discover or Nova.

Assemblyman Gustavson queried Mr. Williams regarding the current rate for processing fees and credit card fees. The charge to Las Vegas Municipal Court by MasterCard and Visa was 2.01 percent and the processing fee was one-half of 1 percent plus 37 cents per item. On an average case scenario the charge would be approximately 2.67 percent, which was well below the 4 percent.

Chairman Anderson thanked Mr. Williams for his support of the bill.

Steve Hartman, Legislative Representative, testified on behalf of American Express in support of (A.B. 24). The concern of American Express was to insure the definition credit card or debit card was included with those other definitions currently within the statute and also included the term charge card, which was used colloquially. He believed the language would be an effective way to get some of Nevada’s public entities out of the collection of bad debts.

Chairman Anderson asked Ms. Lang if the purpose of the language of the bill was to include any other use of charge cards or charging instruments that might be utilized either now or in the future. She believed the definition of credit card was rather inclusive: it included without limitation anyone who would be using something to obtain property, goods, services or anything else of value on credit, so she felt that would include any type of credit card or charge card.

Chairman Anderson asked a notation be made in the record of that particular issue so that in the future there would be no doubt if A.B. 24 passed. It was the intent of the committee to include other kinds of charge and charge card instruments that might be utilized by the courts either now or in the future.

Mr. Gustavson, expressed his concern to Mr. Hartman. He felt it was a good idea that the agency charging or assessing a fine would receive their money, but he questioned whether there were many people who would use a credit card who were incapable of paying for that debt.

He asked if Mr. Hartman had seen increases in the number of people who had filed bankruptcy because they had charges on their credit cards due to excessive fines. He felt they used their card and increased their hardship. Mr. Hartman stated he had no knowledge of whether there had been an increase based upon the utilization of credit cards. He did know there had been some fairly significant debt instruments, namely checks, issued in considerable numbers to the Nevada Department of Motor Vehicles and Public Safety Registration Division. He did not know the fallout on the flip side of the consumer but knew there had been a significant issue with both state and local governments having to do with bad debt.

Mr. Anderson went on to say he thought those type issues would be discussed in the Committee on Commerce and Labor relative to forged instruments and improper use of debt. He did not believe Mr. Hartman dealt directly with those problems, but rather represented a client who was concerned about the intent of the bill being clarified. He thought questions should perhaps be directed to the subject at hand.

Chairman Anderson thanked Mr. Hartman for his presentation and support of the bill.

Harvey Whittemore, a partner with Lionel Sawyer and Collins appeared on behalf of Citibank (Nevada) NA. Mr. Whittemore stated Citibank was in support of the bill and he referenced line 3, which indicated a court in the State of Nevada may enter into a contract. Their major concern was the use of "contract" as a singular descriptive language would allow a court to choose only one issuer. He felt it was clearly the committee’s and the court’s intent to allow them to enter into multiple contracts with multiple issuers. In fact, if the opposite was the case, he would suggest language to express who would be the successful bidder. Citibank would like to make sure MasterCard, Visa, American Express, and any number of issuing entities would be able enter into contracts with the courts.

Responding to a question by Chairman Anderson regarding what language would be drafted. Ms. Lang replied in the preliminary chapters of Nevada Revised Statues (NRS), the Legislative Counsel Bureau (LCB) had stated the singular included the plural and the plural included the singular so the LCB usually chose to draft in the singular whenever possible and that was a drafting choice the Legislative Counsel Bureau had made. The one thing the bill did not do was to require the courts to enter into any contract at all so they could choose to enter into one contract or several contracts and deal with whomever.

Mr. Whittemore said he thought that was correct and was his point in the first place. If the court would choose to enter into those contracts they would have to make them available for all types of instruments. He agreed with the assessment that it could be singular or possessive but would really make it discretionary. He specifically did not think the courts or local governments should pick and choose what issuers they were going to accept and which ones they would not. He gave an example where an individual wanted MasterCard accepted but did not want American Express which would cause Mr. Hartman’s client some grief. If they had said they would take American Express but not MasterCard or Visa, it would cause a number of banks significant concern because they were the issuing entities of those particular cards. Again, he said what needed to be accomplished was to make it clear on the record the committee’s desire was not meant to be discretionary and would allow governments to pick and choose those entities with which they were going to deal.

Mr. Whittemore replied if there was a competitive process, there should be language added so it was not left to the discretion of individuals who would choose them on a noncompetitive basis. That process would have to be ratified statutorily. He felt the committee should address concerns with respect to whether it should be a competitive bid issue, whether there were going to be subjective factors, or whether individual court administrators would accept American Express cards only because their fees were lower than MasterCard or Visa.

Assemblywoman Buckley felt it was not appropriate to require the courts to do a competitive bid. The committee would be tying the courts hands and making the process more lengthy than needed. She felt comfortable with expressing her desire, as well as possibly the full committee’s, that the courts try to make the bidding process as open as possible. She said generally, if there was an exclusion it was American Express and not Visa. She felt comfortable encouraging the court to make it as open as possible to include everyone and "if there were problems we would revisit it next session."

Mr. Anderson asked John Williams to explain the practice established for which credit cards would be accepted. He said it was handled between the courts and cities finance departments. Currently they accepted MasterCard, Visa, Nova and Discover. There was no competitive bid process involved.

Mr. Anderson asked if someone offered a legitimate instrument would it be accepted and Mr. Williams replied yes.

Mr. Whittemore said he felt the discussion was helpful in establishing a record people could use to ascertain the fact the bill was not designed to exclude participation by certain companies in the process.

Assemblywoman McClain drew the committee’s attention to the second page of the bill where it referred to local governments in the plural. She thought perhaps if the language was consistent that would address Mr. Whittemore’s concerns.

Mr. Williams emphasized that was his concern. The plural was used with respect to NRS 354.770 and not with the new section.

Ms. Buckley stated "Making it clear for the record that we would like the courts, if possible, to consider it an open process and to use as many entities as they are comfortable with."

Assemblywoman Leslie asked for clarification regarding whether the proposed amendment would include the processing fee from the bank as well or just the issuing fee from the credit card company. Mr. Anderson said by striking the language concerning the 4 percent of the total they would be able to include those kind of processing fees and would broaden the language to also include other processing fees. It would become 100 percent the responsibility of the person offering the instrument versus the city or state to cover those costs.

Assemblyman Collins said it seemed to him the fee structure range in the courts would have to first allow for varying fines to be assessed or fees to be charged. Secondly, the use of instant electronic transfer of funds through the debit system which transferred the money immediately in exchange for 2 percent of the fee. His question to the committee was if the courts were allowed to receive the extra 2 percent or collected those fees based on the fees already established for charges, fines, convictions, forfeitures; whether the 2 percent actually made a significant difference.

Ms. Buckley said she understood Mr. Collin’s concern. Serving on the committee made them cognizant of the fact when they added additional fines and fees and then an assessment it could cause a simple moving violation to become an astronomical amount. She felt the question of the bill was different because there was a choice between the person who incurred the fine or the public, "the taxpayers," paying for the privilege of using a credit card to pay a debt. She felt in her mind it made sense for the person "as opposed to our general constituents" to pay for the privilege of being able to pay the fine quickly through the use of a credit card. If the court charged an additional fee to make money she would have concern, but that was just a straight passthrough and that was why she felt comfortable with the motion.

Chairman Anderson said for his understanding, obviously someone could pay in cash, courts could have indeed demanded all payments be made in cash. The courts allowed checks to be written and so all they were doing was expanding the ability of the court to be able to take credit cards. The cost of using the credit card would automatically fall to the person who provided the card just as the cost of writing a check fell to that person.

Chairman Anderson placed the amend and do pass motion to the committee for a vote.

THE MOTION PASSED UNANIMOUSLY.

Chairman Anderson assigned the bill to Ms. Buckley.

At that time the committee heard A.B. 16.

Ms. Lang presented the background of A.B. 16. It was the second of the two bills passed by the S.C.R. 10 subcommittee of the 69^th Legislative Session to deal with collection procedures recommended by the Subcommittee on Fees, Fines, Forfeitures and Administrative Assessments Imposed and Collected by the Courts. Currently the local authorities had a provision in Nevada Revised Statutes (NRS) that allowed a notice of nonpayment to be issued for certain nonmoving violations. Once notice was filed a person’s vehicle registration could not be renewed until the fine was paid. The bill expanded that concept and applied it to a court. The court would then be allowed to issue a notice of nonpayment for any fee or fine assessment or restitution not paid within the time limits established by the court. Notice of nonpayment would result in the defendant not being able to renew his registration or driver’s license until a receipt had been obtained from the court indicating the amount owed had been paid. The bill also expanded the authority presently established for local authorities which made the notice of nonpayment applicable to drivers licenses in addition to motor vehicle registration.

Pete English, Chief of the Registration Division, Department Motor Vehicles and Public Safety (DMV & PS), clarified the department’s position on the bill. The department took no position on the bill either in support of or opposition to. It had an existing program for parking violations as indicated previously that the courts could provide notice to the department concerning parking violations which restricted the ability of individuals to register their vehicles until the parking fine had been paid. Currently there were only three jurisdictions in the state participating in that program. Their concern with the program was the potentially significant impact it could have on existing programs with the involvement of district courts and tribal courts. It also opened the door to parole and probation to approach the courts for assessments of unpaid restitution, other court assessments, fees, and fines. He could see the potential of significant impact to their existing program. For that reason they had attached a fiscal note to the bill (Exhibit C).

Mr. Anderson explained Mr. English had brought up an interesting question regarding the possibility of victims of crime being able to receive restitution. There was no process in which that could currently take place other than during the time of their incarceration. Mr. English replied once offenders were placed on probation and had been ordered by the courts to pay restitution they had an obligation to pay the restitution during the time of their probation. If they did not pay, that would leave an avenue for the probation department to approach the sentencing court to place a hold upon their registration or driver record to prevent renewal until such time as they did pay restitution. Mr. Anderson said that gave Parole and Probation potentially another avenue rather than sending someone back to incarceration where they were severely limited in their ability to repay the victim of a crime. Mr. English said that was correct.

Assemblyman Carpenter said he felt there was a mechanism in the bill for the DMV to establish a fee to cover any costs incurred.

Mr. English responded to Mr. Carpenter’s remarks saying the bill did allow for DMV to assess a fee that would allow them to recover costs. His fiscal note pertained to the startup expense of establishing that program. If they were going to initiate the program funding, would be required up front.

At that time John Williams, Collections Supervisor, Las Vegas Municipal Court, Security and Enforcement Division said the court would like to express support for the intent the bill and made two recommendations:

1. "Failure to appear" in court be included as another reason not to renew a person’s motor vehicle registration or driver’s license.

As Mr. English had pointed out the DMV did block registration on vehicles for nonmoving violations and adjudication’s. A.B. 16 would allow the courts another tool in collecting or finding adjudication on those cases. Currently half the delinquency in Las Vegas Municipal Court was due to "failure to appear."

2. Allow the courts to charge a fee not to exceed the fee charged to the court by the Department of Motor Vehicles and Public Safety. Passing on of the fee charged by the DMV to the defendant when a fine paid or a case adjudicated. The cost the DMV charged on nonmoving violations was passed on to the city and was collected from those individuals when they paid their fines. They would like to see the same thing done on the traffic and criminal cases.

Chairman Anderson said he thought there was another bill that dealt with that in part. Mr. Williams said NRS 176, but not to the extent of nonremoval of license or vehicle registration. The DMV also suspended drivers’ licenses on failure to appear upon notification of the court which effectively blocked the renewal of that license.

Chairman Anderson asked Mr. Williams to prepare a proposed amendment and send to him by February 12, 1999, to be used at their next work session.

Assemblyman Nolan noted DMV had the ability to collect fees and fines because they had entered into a contract with a court in a particular municipality. Did the language preclude "fine" from being collected at the window from the individual and then still allow the individual to renew.

Mr. English responded DMV did not collect a fine imposed by the court. When the DMV mailed out a renewal notice it was indicated on the notice there was an existing fine or fee and it indicated the court where it must be paid. The notice advised the individual to go to that court and take care of the matter. Once the fine was paid the court notified DMV electronically and removed the notices from the record, so when the customer went to the window and the clerk pulled it up on the computer it was already noted it was paid. If for some reason they did not receive the notice electronically they would accept a receipt from the customer showing payment had been made.

Chairman Anderson asked for further clarifications regarding how far in advance did those notices go out prior to registration. Mr. English said approximately 60 days.

Judy Jacoboni, Victim Advocate, Mothers Against Drunk Driving Lyon County Chapter, testified in support of A.B. 16. They supported the bill because it offered an opportunity for victims of crime to receive restitution. Previously the opportunity was not available. They had no problem with the misdemeanor, municipal, and justice courts collecting restitution and making sure victims received payment because that had always happened in the past. Their concern was in the felony area where offenders generally went from court to prison and then there was no opportunity to pay restitution while in prison. When released to house arrest under programs based on previous assembly bills "305" or "317" there was no statutory provision for restitution to be required as a condition of house arrest. But, she said, parole and probation generally did make it a requirement. The offender may move from house arrest to parole and during that time restitution might be a condition of parole. Once parole was finished, there was very little provision for victims to collect restitution which was one of the very first opportunities an offender had to actually work again and generate the revenues needed to be able to pay restitution. The bill would provide an easy avenue for victims of felony crimes to approach a judge or a division of parole and probation and ask the notice be written and, hopefully, be able to receive restitution payments.

Carlos C. Concha, Chief, Nevada Parole and Probation testified in support of

A.B. 16. The bill would open the door for parole and probation to seek restitution from those offenders who had been discharged or failed to pay restitution. When the offender was discharged they advised the victim they would no longer have contact with the offender; however, the victim may seek civil remedy to obtain that money through the courts. Many times the victims did not pursue that avenue and as a result did not get reimbursed for their losses. There were many times the victim was not reimbursed during the supervision period. Mrs. Jacoboni stated those going to prison came out on "a short tail or they come out with no tail of supervision at all."

Mr. Carpenter asked Mr. Concha if a program was in place to handle someone who had been in the system and not able to pay restitution due possibly to the fact a substantial amount was owed. What if that offender needed to get a driver’s license to get a job or needed to buy and register a vehicle. Was there a way to establish a payment plan with penalties.

Mr. Concha responded Parole and Probation did not have a program. One of the problems with collecting restitution was among those victims that had lost hundreds of thousands of dollars. He hoped a program would be established to look at that type of offenders who virtually could never repay that amount of money, and work out some type of program where at least the offender could provide a payment before his license was removed. Parole and Probation would like to work with those offenders so they could show a good faith effort in making payments to the victims.

John C. Morrow, Chief Deputy, Washoe County Public Defender’s Office stated he worked only with the indigent and the bill appeared to be one where absolute liability was placed on a person when they were unable to pay a fine or fee. He felt, in fairness to the person who was the subject of the problem, that they be allowed or given the opportunity to show they were unable to make payments. He said he was aware the misdemeanor courts were imposing some fairly substantial fines and fees on people and many of the folks with whom he worked were simply unable to pay within the time constraints the courts required. He suggested there be an amendment requiring the failure to pay the fines and fees as being a willful failure by a person who had the ability to pay. He felt that went along with Mr. Carpenter’s question of Mr. Concha.

Chairman Anderson asked Mr. Morrow to examine the bill, develop an amendment and submit it within a week’s time.

Lucille Lusk, represented Nevada Concerned Citizens and testified against A.B. 16. Mrs. Lusk asked the committee consider the impact of refusing a vehicle registration on a single car family. She gave the following example. If "Dad" got in trouble and did not or could not pay a fee or fine which may have had nothing to do with driving safety, and the state removed the use of the family’s only car, the greatest penalty fell on those who were innocent of any offense, "Mom and the Kids." Moms as well as Dads had no car to get to work or to get the kids to school functions or other activities. Potentially the family’s already limited income could be totally lost. When that happened there would be all kinds of ramifications to be considered and she asked that they consider them carefully. "We do recognize the very delicate balance that you are charged with finding and we trust you will find it."

Mr. Carpenter felt the last testimony raised the concern of the committee, but that should be handled within the judicial system regarding what type enforcement took place.

Mr. Anderson said judicial discretion came before the committee all the time and trusting the judge to make the right choice was what it was all about and what was taken into consideration.

Stephen W. Driscoll, Municipal Court Administrator, City of Sparks, testified in favor of A.B. 16. The court had concerns and asked if he would be able to submit those concerns for a future work session. Chairman Anderson thanked Mr. Driscoll for helping to expedite the meeting.

Mr. Anderson opened the hearing on A.B. 19 saying the recommendation had received severe criticism from local government and some judges because it would change the way many courts treated payment of traffic citations by people who did not appear in court. Several newspaper articles had quoted judges and others who accused the subcommittee of trying to take away money from counties and cities in the state. However, he reminded the committee the constitution required all fines be used for educational purposes. In addition, legislative counsel had stated it was her opinion that bail forfeitures should be treated as fines since it had all the attributes of a fine and none of the attributes of a bail. He agreed with that opinion personally and said it did not make sense to him that money paid for a traffic citation if he appeared in court should be treated differently then if he mailed in the money. He did not believe the money should have ever been characterized as anything but a fine.

Regarding testimony received by the subcommittee, Mr. Anderson thought it was important to remember not all courts in the state treated money mailed in to pay citations as bail forfeiture, therefore, those courts that characterized that type of payment as a bail forfeiture had a source of revenue other courts simply did not. That discrepancy seemed inappropriate. With many counties and cities merging into municipal and justice courts the issue became even more critical for the legislature to hear. He felt they did not want to take away money from local governments but it was important to uphold the intent of the constitution. He said "Our constitutional founders believed it was important to separate the courts from the money they collect." The separation was necessary to avoid abuse or the appearance of abuse and the temptation to impose high fines to raise money to support the courts. Thus, money collected from fines was dedicated for educational purposes. The constitutional founders believed doing that would guarantee money would always be available in the state for education, which the legislators believed was the greatest deterrent to crime.

Chairman Anderson said yesterday the legislative auditors and fiscal analysts reported the division of money had greatly reduced the deposits in the state permanent school fund. He provided comments to dispel the recommendation was solely intended as a way for the state to take money that belonged to local government. The question for the committee was whether the money ever rightly belonged to the local governments in the first place.

Chairman Anderson called upon Ms. Lang for presentation of the bill. The bill dealt with the bail forfeiture issue and amended NRS 484.813 in section 2. It provided that the amount of money a person was required to pay for a traffic citation without appearing in court must include any administrative assessment the court would impose if the person appeared in court. A.B. 19 added subsection 4 to clarify money paid for a traffic citation was required to be treated as a fine for the purpose of revenue, regardless of how the payment was characterized on the citation. Subsection 5 was added to provide that traffic citation must not include a statement designating payment of the citation was a forfeiture of bail regardless of how the person paid the money owed on the citation.

Chairman Anderson called upon Robert L. Crowell of Crowell, Susich, Owen & Tackes, Ltd., representing the Judges Association. He thanked the committee for allowing him time to speak and for raising a very significant issue. He understood Mr. Anderson’s remarks and the need for uniformity. He felt Chairman Anderson had correctly identified the problem saying it was an issue that affected two of the most basic functions in which the civilized society engaged in the administration of justice and the rendition of education. In private life Mr. Crowell was past president of the State Bar Association and currently an elected member of the Carson City School Board. He asked that the committee listen to the judges. Judges were the "first face or first contact" most people had with the judicial system. He agreed with Chairman Anderson and indicated if society was properly educated perhaps those people would never have to see that "first face." He asked the committee to find a way to rectify or otherwise replace funds that went to the administration of justice.

At that time Robey Willis, Justice of the Peace, Municipal, Judge for Carson City, and President of the Nevada Judges Association presented testimony opposed to A.B. 19. He opened his remarks by stating they all felt the first part of the bill was good. He referred to the part clarifying that money paid on a traffic citation without appearing in court must include any administrative assessment imposed if paid in court. That had been a gray area for years. For clarification, he gave an example regarding the total amount on a ticket which was a $50 fine and a $30 administrative fee. Did one pay the $50 or did he pay the whole $80 if you got a traffic ticket and decided to send it in and forfeit it. That would clarify it once and for all. "Yes you do," he said. He felt not one judge present would oppose that section of the bill.

The other part of the bill they adamantly opposed dealt with turning forfeiture monies over to the state. There was a connection between local courts and local government because local government had to pay for the upkeep of not only the courts but the district attorney that prosecuted the case, upkeep of jails, and various costs that transpired with traffic citations. Removing of forfeiture monies from local governments would mean counties and cities would be forced to take drastic measures and three of the six justice courts in Washoe County would possibly close. "Washoe and Clark and Carson would take a terrible hit financially, but the rural areas would be even worse because there would be that reality that some of them would have to close if this bill passed."

Chairman Anderson asked Judge Willis to explain the difference between municipal court and justice court and what happened in Carson City. Mr. Anderson remarked because of the question of forfeiture in earlier times one could not be a hundred miles away after getting a traffic ticket because on a horse it just did not happen. When the constitution was written in 1864 and modified 1 year later with forfeitures, there was not a big concern because usually those people would be around for awhile. Today if you received a citation you had the convenience of being able to mail the payment causing overlapping responsibility. His major concern which was the difference between municipal court and a justice court as was the case in Carson City.

Judge Willis said Carson City was a consolidated municipality. In Carson City there was a statute that said any citation issued inside the city limits of a municipality shall be cited into the municipal court. He further explained Carson City had a justice/municipal court. "District Attorney Waters 8 or 9 years prepared a form several years ago and there were many of these forms in other jurisdictions and this is what Chairman Anderson had referred to, not the forfeitures we are talking about fines." If a person received a citation in their municipality they would change or convert it through a motion and an order through the district attorney’s office to the Carson City Municipal Code, so therefore the fine became a forfeiture. Judge Willis said forfeitures had always stayed with the local jurisdiction. He said the fines from the highway patrol were always a gray area. If they were issued in the municipality, a statute was in place that said that all tickets were to be cited in the municipality and that was when District Attorney Waters and many other district attorneys in similar situations started the process to keep the local monies to support the local courts, district attorney’s offices, jails, and sheriff’s departments. He said it took only 5 to 7 minutes to write a ticket, but the brunt of all that was always taken by local government.

Max Bunch, Justice of the Peace, Argenta Township, Battle Mountain testified against A.B. 19. He did not find any proposed language to help the district courts. It just related to traffic citations and misdemeanors. He wanted the committee to understand the difference between a justice court and a district court. When someone was sentenced in district court they were mandated to go to prison for 1 year and to pay a $2,000 fine which was mandated by the legislature. While they were in prison they were almost never able to pay the $2,000 fine. When fined in justice court it was a minimum of $200 to a maximum of $1000, that was proposed to be $400 and $1000 in another assembly bill. It was very easy for the justice court to keep tabs on that person in most of the rural areas; he said he would not speak for the larger areas.

Judge Bunch required people to come back to his court to ensure they had completed every aspect of their sentence. He believed most courts made a great attempt to do the same.

Chairman Anderson asked Mr. Bunch and any other judges present to submit written testimony that would be distributed to the committee before any further action would be taken on the bill.

Steven D. McMorris, Judge, Tahoe Township Justice Court testified in opposition of A.B. 19. His court encompassed a small geographical area, but it was a high volume court. There are four major casinos and one of the most dangerous highways in the United States between Glenbrook and Stateline upon which a lot of people traveled. The Nevada Highway Patrol did a magnificent job in the enforcement of traffic laws on Highway 50 and State Route 207. They wrote between 2,000 and 3,000 tickets a year within their jurisdiction. After a citation had been issued the burden of processing those tickets and making sure those people went to court fell upon the county. Out of every 100 tickets, 10 percent of those people went to court from an arraignment through a trial. That money was all treated as fines and went to the state. People who sent their money in prior to the arraignment date, were treated as forfeitures. In the justice court of Tahoe Township that ranged from $100,000 to $125,000 a year that was treated as forfeitures. He said they were collecting 88 percent on citations before turning them over to the collection agency. People got citations, whether they lived in Paris, Elko or Stateline were made to account for the tickets they got within their jurisdiction. The state would have to fund them to cover the laborious process of pursuing Nevada Highway Patrol tickets. Judge McMorris stated "one-third of time taken by my court staff (four clerks) was involved in just pursuing those matters." He asked "if you are going to pass this bill, would you please make sure that the state sends us $125,000 a year so that we can continue to back up the Nevada Highway Patrol?"

Ms. Buckley commented it seemed the constitution was clear and the first day of session the legislators took an oath of office stating fines would go to schools. She said she was from Clark County and those schools were in trouble. In her district and other districts there were double sessions and crowded classrooms. "Our growth is a blessing and a curse." She agreed with the Legislative Counsel Bureau and auditors there were some games being played. Especially when a court changed the practice and stopped sending fines to the state because other courts were not doing it. She felt on one hand the legislators absolutely had to have uniform procedures and had to make sure the money earmarked for schools was in fact going to the schools. On the other hand, she heard loud and clear from subcommittee hearings the courts were spending time processing the tickets just as Judge McMorris had said in his testimony.

Ms. Buckley continued "we cannot just pass a bill today or tomorrow that says the state is going to get 100 percent." It would not take into account the townships’ or counties’ legitimate costs in processing those tickets. Budgets had already been passed and been in place and the legislature could not just cause havoc on the courts. She felt there needed to be a future plan to permit the courts to receive reasonable processing fees. They needed to establish a uniform procedure to allow some monies to be kept by the courts, and designate which monies belonged to "our kids and schools." Instead of all of the time and acrimony of the two sides saying it had to be all or nothing, they needed to work on something that was reasonable so both sides and both issues would be taken into account. Judge McMorris said he would be more than willing to participate in that effort. He had been the judge in that court since 1981 and stated they had not changed their procedures and had been following the rule of the law.

Ed Dannan, Reno Justice of the Peace, Administrative Judge, addressed the issues of forfeitures from citations versus forfeitures after arrest. He commented on citation forfeiture versus bail forfeiture. He restated the bail forfeiture in the hypothetical situation Mr. Anderson proposed earlier. He believed the person who committed the battery was arrested and posted bail and after that the parties got back together and decided there was no reason to proceed and bail was forfeited. He said the same thing happened in his court if a person was cited and posted bail because they were not appearing on the citation just they were are not appearing after release from custody. In either case they treated those as a forfeiture.

Judge Dannan said it really was a legal question whether when the person went in and paid if that constituted the payment of the fine or the payment of the bail. In Mr. Anderson’s scenario there was never an adjudication of guilt by the court and so it was difficult for him to understand how someone was fined if they had never been found guilty of committing the offense with which they were charged.

As a judge, his work with the court was to impose fines and find someone guilty. If there was not a finding of guilt then there was another process by which those matters were handled whether they were citations or whether their bail was posted from jail. That was a process that had been in place when he began working with the court in 1993. He said his only comment was the issue of whether the bail could be considered a fine in absence of a finding of guilt. He felt he would have to leave that to the district attorney’s office for his county and others to answer for the committee.

Mr. Collins said it seemed to him the constitution said a fine went to education. He felt the legislature had empowered counties to establish county and municipal courts. The fines by constitution went to the state for education, the county fines or bails were established by the counties. His issue was whether it was in the power of the county commissioners to determine that a citation or collected fee, was a fine or forfeiture. He questioned whether they were proposing legislatively to take that power away from the county to determine the distribution or collection of the money. He wondered if they were trying to legislate what a court should decide. He said if the cities and counties were in violation the state should pursue legal remedy in court rather than through proposed legislation.

In reply to Mr. Collins concerns, Chairman Anderson said there was a constitutional issue based upon Article 11 subsection 3 of the Nevada Constitution relative to the dollars that went to the state permanent school fund relative to the dollars spent. The Committee on Judiciary heard from the auditors the loss of revenue in the amount of $5 million compounded annually over the last 2 years was a sizeable amount. They also recognized statutorily that county courts and justice courts were the jurisdiction of the county and townships were given to the municipal courts. "Both the counties and the cities are creatures of the state legislature. We create them and therefore the municipal courts do not have to send those dollars to the state and we have always said that." The legitimate question the committee had to address was what to do with forfeitures and why the state was losing money.

Jay D. Dilworth, Judge, Reno Municipal Court said he wanted to clarify for the committee the confusion regarding what was a fine and what was a forfeiture. The Chairman’s scenario if one was stopped in Reno and given a ticket and signed that ticket it was a promise to appear. At some point subsequent bail was posted on that ticket. Posting bail did not preclude a person from going to court; they still expected a person to appear on the date and time noted. When a person failed to appear in court they did not adjudicate guilt, the bail was simply forfeited. The difference was if the person happened to have been in a traffic accident there was an issue of liability and failure to appear in court was not an adjudication nor admission of guilt.

Continuing Judge Dilworth said it would not be used against them in a civil action to recover; any appearance where they pled guilty or were found guilty could be used against them. The issue was there were no sanctions, they were not found guilty of the offense, they simply had the fine forfeited. Under a separate piece of legislation, DMV was allowed to assess points for driving records on tickets where they were forfeited. It was not a finding of guilt. Another time some years ago the legislature allowed DMV to assess the four points on a ticket even though the person did not go to court. It was still not considered legally an adjudication of guilt. Mr. Anderson thanked Judge Dilworth for the clarification.

Mr. Anderson said the public had a different perspective when they were pulled over and cited for a traffic citation and went to the courthouse to pay. "They think they are told if you pay this that it is over with and you do not have to be here and they do not anticipate that as bail. They perceive that as paying and as an admission of guilt and that they are going to move forward. That is a crucial question and that is the reason why we are having this debate."

Mr. Collins stated he had just expanded the confusion. He questioned Judge Dilworth on his statement a bail posted for a Reno citation was not an admission of guilt. Then two sentences later he said a fine was posted. One time it was a fine and one time a bail, and Mr. Collins said it needed to be consistent.

Judge Dilworth apologized to the Chairman if he had done that. The amount of the bail posted was not a fine. It was never a fine until the drop of the gavel, when they came to court and entered a plea of guilty. He said it was a bail and it would be converted if the person failed to appear; however, if the person posted bail sometime subsequent to the ticket issue, they were still expected to come to court. The court had them set for a particular calendar date and the ticket would still be in force. They were on the calendar docket, but if they did not appear a bench warrant would not be issued.

Chairman Anderson asked Ms. Lang to review the documents and provide a citation form from DMV. He was curious whether the wording was forfeiture or fine.

Mr. Carpenter said if when you post bail, it was the same as when they sent in the money for a traffic ticket. "If we are saying here that when we post bail we’re admitting guilt." He did not feel the system provided for that. To his way of thinking to be charged a fine one had to be brought before a court and found guilty and then pay the fine. He felt they were saying because a person posted bail or promised to appear in court the person was admitting guilt. The committee was going beyond what the system of justice really needed. Someone in constitutional law needed to examine the proposed legislation. He further stated when one posted bail in the proposed bill it must be considered a fine. So he felt it should be turned around to say it would be considered a forfeiture if the legislature had the power to make it a fine. They could make it a forfeiture also, but he would have a problem saying "because I go down and post bail that I am guilty and I think that is what we are doing with this legislation."

Ms. Buckley said part of the problem was because the Nevada Highway Patrol ticket did not provide a spot to write innocent or guilty. It basically had a bail forfeiture request box on it and page 75 (Exhibit D) of the study document said "I waive my right to appear in court and basically allow the bail to be forfeited. I just want to pay the fine." Basically they wanted to go ahead and pay the fine which by the constitution went to the school fund. She reiterated her original statement that there needed to be uniformity and they had to recognize the constitution as well as recognize the courts had legitimate expenses and they could not cripple the courts.

Robert S. Hadfield, representing Nevada Association of Counties, testified A.B. 29 would require counties and municipalities to make fundamental changes regarding the manner in which traffic citations were processed and how the funds collected were apportioned between various local and state agencies. The practice of processing some citations as forfeitures would be prohibited and all traffic citations paid were then to be processed as fines. The resultant impact would be to direct current county revenues used to fund justice courts to the State of Nevada.

The policy of the Nevada Association of Counties, in keeping with voter approved Question 8 in the 1993 general election, was to oppose any legislative action that required counties to provide services without revenue to offset the costs. A.B. 19 if enacted, Mr. Hadfield explained would take revenues used to help offset the cost of counties of administering the court system, without any change in the level of service required and would create an unfunded mandate.

The association opposed the proposed change in A.B. 19 which would require money paid on traffic citations to be treated as a fine, not a bail forfeiture, thus requiring current county revenues to be transferred to the state. They supported collection of administrative assessments and efforts to establish a uniform collection and reporting system.

Mr. Hadfield urged the committee to reject A.B. 19 on the basis it would cause irreparable harm to many of Nevada’s counties and would result in an unfunded mandate.

Statistics provided by auditors were stale dated. Mr. Hadfield said they were 6 years old, and implied certain practices were underway generally across the board for all counties in Nevada. He said he would argue they were not representative of what was happening in Nevada. Counties were acting responsibly across the board to do what they could, within their power to insure those people who needed to be brought to justice were indeed brought to justice. He reminded the committee that as county commissioners they had the executive and legislative branches of government and they had a separation of powers in county government the legislators shared when they dealt with the Nevada Supreme Court. He felt the counties he represented where the ones who were left to the end result of whatever deliberations would take place and whatever costs occurred with regard to the judicial system. Refer to (Exhibit E) for the remainder of his comments.

At that time Anthony "Tony" L. Lesperance, Chairman, Elko County Board of Commissioners gave testimony on A.B. 19 stating collection procedures on fines and forfeitures in justice courts for the State of Nevada was a separate issue. All courts in the State of Nevada did not necessarily pursue collection of delinquent accounts in the same manner or with the same enthusiasm. Elko County had a collection department, devoted to the collection of citations once they had gone to warrant. He estimated that approximately 57 percent of citations were collected prior to the issuance of a warrant. When a warrant was issued and the citation transferred to the collection department they experienced a collection rate of 48 percent. Overall the estimated collection rate annually for Elko County was approximately 78 percent.

He stated for the record "the justice courts of Elko County would come to a halt if this bill was passed." Refer to Exhibit F for remaining testimony.

Mr. Anderson thanked him for his well presented and documented proposal and asked what percentage of the overall court costs was the highway patrol carrying.

Cash A. Minor, Chief Financial Officer, Elko County, answered the NHP citations were roughly 25 percent of the cases handled through justice court.

Ms. Buckley requested a letter from Mr. Minor regarding NHP citations and if they were referred to the municipal court, and whether they were converted to local ordinances or kept straight as NRS violations. She also wanted to know how much money was collected from them and whether any of that money was forwarded to the state.

Mr. Minor said he would provide Chairman Anderson the requested information.

The Chairman said he had been notified by the Speaker of his intention to speak and also the Minority Leader had indicated his intention to come speak.

He would proceed with testimony as follows: Mineral County, Lincoln County, Humboldt County, Douglas County, Carson City and finally Washoe County. In the interest of time he asked that the speakers limit their presentation to approximately 5 minutes.

At that time Jackie Wallace, Chairman of the Mineral County Commission, spoke in regard to Mr. Hadfield’s previous comments "I fit all of the above." Their county was of the tax cap at $3.64 and a school bond of 60 cents passed. The county also had to slash positions which reduced services provided to the community. If the county was required to send those monies to the state they would not be able to keep their court system open. There was no way to raise more revenue in the county. "We couldn’t afford to lose $1 let alone $150,000 to $200,000. We would have to close the courts."

Mr. Anderson said the impact on Mineral County would be substantial. He asked Mr. Don Williams to provide the recent report from the tax commission regarding the percentage cap of each county and the disposition of those dollars.

Dan Frehner, Lincoln County Commissioner, agreed the state needed to adopt universal procedures in the county. Lincoln County had two justice courts, the Meadow Valley and Pahranagat Valley with a combined budget of $170,000. Eighty-five percent of their caseload was NHP-related which amounted to approximately $140,000 of their budget. He gave the following statistics: Sheriff’s office in fiscal year 1997-98 had 260 arrests, 154 of those were county-related, 98 NHP-related and 8 others. There were 684 prisoner days in the county jail for NHP-related arrests at a cost of $50 per day which amounted to $34,000. The district attorney spent approximately one-third of his time on NHP-related arrests. It cost the county the combined total of those three figures amounting to $194,000 to take care of NHP. The income received from forfeitures in those two district courts was a total of $303,610. Lincoln County School Superintendent received approximately $20,000 from the state distributive account in fiscal year 1997-98. In 1997-98 the total budget for Lincoln County was $2,530,000. The County had been informed in fiscal year 1998-99, because of centrally assessed losses, it would lose $233,000, which would be a loss of 10.8 percent.

Chairman Anderson asked Mr. Frehner to submit his written testimony to the committee for inclusion in the record.

Mr. John Milton, Chairman, Humboldt County Commission, told the committee they operated four justice courts and the cost of operating those exceeded $500,000 a year. The commission would like to present a total breakdown to the committee for review. He requested if the changes were made, some sort of compensation be distributed to their justice court system in order to cover the cost of the citations.

Jacques Etchegoyhen, Chairman, Board of County Commissioners, Douglas County, stated education was very important to his family. His father had taught Bob Hadfield. Eliziah and Israel Mott opened the first school in Nevada 10 years before it became a state in the area now referred to as Douglas County. As with all counties, they took pride in the tradition of excellence in education. He felt the committee needed to consider the broad policy implications of the bill. Removing 30 to 40 percent of the funding for the justice courts in Douglas County would bring that court system to its knees. "Regardless of all the other specifics, that is in effect what it would do." He felt that was not the intent of A.B. 19 but that would be the effect. Chairman Anderson asked for written documentation to be included in the record (Exhibit G).

Chairman Anderson welcomed Assemblyman Lynn Hettrick, Assembly District 39, and said as minority leader he would give him "due deference." Assemblyman Hettrick stated for the record, "The small counties clearly are going to be hugely penalized." He added the Committee on Ways and Means and the Committee on Taxation should review the bill before any action was taken. "I’m not sure we can do it right now. I think this may have to be a long-term endeavor. Before we do it, let’s find a way to replace it."

Mr. Anderson thanked Mr. Hettrick and said "of course you have not heard the last 6 years worth of testimony on this bill. It is not like this is a new question we are dealt with, however, clearly it was not my intent to move forward in processing this bill without being mindful of the fiscal impact." He felt they had a crucial question to deal with judiciously in terms of clarifying the accounting process. There was a fiscal study done several years ago and his concern was they had a clear record so the courts in no way were impugned based upon their process of how fees, fines, and forfeitures were received or distributed.

Mr. Anderson did not care to see another audit report done which reflected negatively on what he considered to be one of the more important branches of government. Clearly the justice court and municipal court "where the robes of justice truly touch the people and therefore that is where my greatest concern has always been."

Mr. Hettrick said he was aware of the 6 years of testimony and that his point was the discussion had taken place over some period of time, but the legislature had never taken the money away, and he felt they needed to come up with some replacement.

Chairman Anderson announced the call of the speaker took precedence over anything else, it was not the intention of the Chair to take a motion on the bill at that time. He said Mr. Hettrick had clearly stated, "It is not the intent of the legislature to financially bankrupt the judicial system of the state by taking away a revenue form but rather by making sure that what we do is clear and expeditious."

Mr. Carpenter stated for the record he would like to have it known "although I was on the S.C.R. 10 Subcommittee that I did not vote in favor of the bill draft that is in front of us."

Due to the lateness of the hour, Speaker Dini was unable to attend the meeting and provide testimony.

There being no further business the meeting was adjourned at 11:05 a.m.

RESPECTFULLY SUBMITTED:

Novella Watson-Lee

Committee Secretary

APPROVED BY:

Assemblyman Bernie Anderson, Chairman

DATE: