The Assembly Ways and Means and Senate Finance Joint Subcommittee on
Capital Improvements was called to order at 8:05 a.m., on Tuesday,
March 16, 1999. Chairman Morse J. Arberry Jr., presided in Room 3137 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List.

ASSEMBLY SUBCOMMITTEE MEMBERS PRESENT:

Morse J. Arberry Jr., Chairman

Mr. Joe Dini

Ms. Jan Evans

Mr. John Marvel

Mr. David Perkins

SENATE SUBCOMMITTEE MEMBERS PRESENT:

Senator Coffin

Senator Mathews

Senator Rawson

Senator Raggio

STAFF MEMBERS PRESENT:

The Chair recognized Mike Meizel, Chief, Buildings and Grounds Division (B&G), Department of Administration, to present the budget for that agency.

Mr. Meizel referred committee members to (Exhibit C), a handout that provided additional performance indicator information. He said the agency was attempting, through its performance indicators, to provide committee members with a yardstick for future reference regarding state-owned building rents, facility management, maintenance, and operation. Using the personnel component as an example, he said if the percentage appeared high in proportion to the total budget, it might raise a red flag to committee members. He pointed out the utilities component had remained fairly static, a good sign the state managed that area well, in spite of rate increases.

While the majority of B&G’s maintenance functions were privatized, its maintenance personnel were responsible for monitoring the contractor and performing day-to-day maintenance that would not easily be contracted out. He pointed out renovation costs had grown and, as a result, B&G had many expensive buildings to maintain. One example was the Sawyer Building in Las Vegas, which was large, complex, and high-tech. He said future B&G budgets would reflect a large percentage of expenses for that. He pointed out the renovation component in Exhibit C reflected in excess of $250,000 to rebalance the heating, ventilating, and air-conditioning (HVAC) system in the Sawyer Building.

The Chair referred committee members to page ADMIN-69 of
The Executive Budget, performance indicator 3, and asked Mr. Meizel to explain how the anticipated savings increase of 51 percent through energy conservation efforts had been derived. Mr. Meizel deferred the question to Pat McInnis, the agency’s engineer, for response. Mr. McInnis said the energy estimates were typically taken from projections obtained from a faser program the agency used to track energy bills on a month-to-month basis. Projections were made based on expected utility prices. He said the energy management systems of various state agencies were upgraded on a continuous basis to achieve the lowest energy use possible. Those efforts provided incremental savings. The anticipated savings increase of 51 percent was also based on documented historical savings. Those historical savings were projected forward with allowances for work that would be performed on individual agency energy systems. Those projections were then balanced against the continued increase in use of each building as it became more popular. For example, the use of the State Library had increased each year since its opening. Mr. McInnis said the savings represented a best guess. He noted B&G had maintained very detailed records of energy consumption over the past 7-years.

Mr. Meizel said the largest revenue item for B&G came from rent charged to state agencies occupying state-owned buildings. One goal for this biennium was to maintain the rent level at the amount charged in FY 1998 so as not to impact those agencies with anticipated budgetary issues. The rent had been kept at 72 cents per square foot. He said one strategy B&G had for maintaining the FY 1998 rent rate was to buy-down the reserve. B&G felt secure in its decision not only because rent was billed one year in advance, but there was $675,000 held in contingency for special building renovation projects. Renovation funds were typically not spent until the second year of the biennium in the event of a deficit projection or other catastrophe with the budget.

The Chair asked what the rent projection was for FY 2000 and FY 2001 and Mr. Meizel said 72 cents per square foot. Mr. Meizel explained there was an error on the average cost-per-square-foot listed at the top of page C-1 of
Exhibit C. The projected FY 2000 and FY 2001 costs should both read
72 cents. Those figures were correct in The Executive Budget.

Mr. Meizel told committee members the division was asking for two positions; an Administrative Aid position for both the Las Vegas and Carson City offices. The position in Las Vegas was needed because there was only one other Administrative Aid position in that office. As he pointed out, Las Vegas was a large office and was continuing to grow. Lunch hours were covered with a recorder, which he felt was not particularly tenable. A tremendous amount of paperwork was generated in the Las Vegas office as the result of contract services. The position was badly needed. The Administrative Aid position in Carson City was needed for the increased workload associated with contract work and leases. Mr. Meizel said the positions were not asked for lightly. If committee members looked at B&G’s past trends, there had been very few positions added in any given year.

The Chair said he understood the Public Utilities Commission (PUC) and Transportation Services Authority (TSA) were moving out of the Sawyer Building and asked for background information. Mr. Meizel said the reason those agencies were moving was to accommodate an expansion of the Attorney General’s and State Treasurer’s offices. Another reason PUC and TSA had been chosen to move was the fact they were both fee-funded agencies and could more easily accommodate paying lease costs than the other General Fund agencies within the building. The Chair expressed his other concern over the new PUC and TSA rent costs compared to their current rent costs at the Sawyer Building. Mr. Meizel confirms PUC and TSA rent costs would increase. The Chair asked for a figure, and Mr. Meizel said they would probably be paying somewhere around $1.60 per square foot. The Chair asked if suitable space had been found and Mr. Meizel said there were quite a few locations in Las Vegas that met B&G’s market rate. He said if the budget were approved, the move could be made fairly quickly. The Chair asked if the new rate had been figured into the budgets of PUC and TSA. Mr. Meizel did not know the answer to that question and said the Budget office would know. The Chair recognized Jim Manning, Principal Budget Analyst, Budget Division, Department of Administration who told committee members the analyst in the budget office was aware of the extra cost and had been working with those budgets to ensure the increased costs were built in.

The Chair said he understood there was a Y2K conversion effort planned for the Sawyer Building. Mr. Meizel explained the conversion was for the computer-driven security system for the building. B&G had wanted to make changes to that system within the last year or so but, after conversations with the supplier and computer programmers for the system, had deferred the upgrade to this biennium to ensure Y2K compliance. He said the system controlled all the doors and alarms in the building.

Mr. Meizel referred committee members to Decision Unit E-176 on page
ADMIN-74 of The Executive Budget. He explained that decision unit reflected Y2K compliance issues. Decision Unit E-197 reflected a transfer from B&G to the Capitol Police budget in the amount of $9,185. Decision Unit E-710 recommended the funding to purchase replacement equipment for B&G daily activities, to include a new telephone system that had been recommended by information services. Decision Unit E-720 asked for funding for the purchase of new equipment.

Finally, Mr. Meizel explained the special projects unit requested approximately $675,000 in each year of the biennium to provide for on-going maintenance and renovation projects identified by each agency. He said each building was inventoried every biennium based on historical and future maintenance needs. A list was then generated outlining the needs of each agency. That list allowed B&G to maintain a constant computerized inventory of maintenance items. Although comprehensive, there was always the chance of a maintenance need B&G had not anticipated. Mr. Meizel explained the special project unit provided funds for replacement of mechanical items, carpet, painting, parking lot striping/sealing, and other maintenance issues. He said $281,000 of the $675,355 special projects total in the second year of the biennium would be used to upgrade the sensors and controls and balance the HVAC system in the Sawyer Building. $176,000 of the $675,355 would be used to replace a portion of the carpet in the Sawyer Building. He explained B&G replaced carpet on a phased basis.

The Chair asked if there were any provision in The Executive Budget to address Y2K issues in all facilities statewide. Mr. Meizel explained B&G was partially involved with a couple of issues surrounding the Y2K problem, but was not the point agency. He said a committee had been formed to deal with
embedded-chip issues of state agencies. B&G had inventoried all buildings and had a list of equipment that would require attention by the committee. B&G felt it would be able to deal with Y2K issues in its buildings. He said the committee was comprised of State Public Works, Emergency Management, Risk Management, Information Services, and others. The committee would address major Y2K issues.

The Chair recognized Ms. Evans who asked how long the Sawyer Building had been open and Mr. Meizel responded six years. She questioned the need for new carpet. Mr. Meizel explained B&G figured a 5-year wear was not untypical for replacement of commercial carpeting. There were instances where carpet would last seven, eight, or even nine years, depending on traffic. There were also instances where carpet would have to be replaced in 4-years. He told committee members high-traffic areas in the Sawyer Building, the main corridors, were in need of replacement. Ms. Evans said she had visited other state agencies where the building was very seedy and the carpeting was old. As an example, Mr. Meizel said the carpet in the state Budget Office, on the third floor of the Blasdel Building, was in bad shape even though it was only
5-years old. The same carpet in another part of that building that was not a high-traffic area remained in good condition.

Ms. Evans asked if the building in Reno occupied by Welfare was state-owned or rented, and Mr. Meizel said there were actually two buildings, one on Mill Street and one on 9^th Street, and those buildings were leased. Ms. Evans asked if Mr. Meizel had been in the main Welfare office and Mr. Meizel responded not within the last year. Ms. Evans said she could not work in the building, it was so shabby. Mr. Meizel said he would visit that location. He pointed out Welfare offices were the most difficult to maintain because of the volume of traffic and agreed with Ms. Evans that most welfare offices were very tight on space.
Ms. Evans commented there had been some renovation in the building location on Belrose in Las Vegas and Mr. Meizel said that was a state-owned building. He explained it was more difficult to maintain a leased building.

Senator Raggio asked for a definition of a refrigerator reclaimer. Mr. Meizel explained that piece of equipment would reclaim Freon from compressors.

The Chair asked for an explanation of overtime costs in Decision Unit E-125 which increased from a budgeted amount of $2,109 in FY 1998 to $29,317 in each year of the 1999-2001 biennium. Mr. Meizel explained the amount of overtime worked had not particularly changed, but the method of payment had changed from comp time to pay in many cases. He told committee members B&G was a 24-hour operation and felt it necessary to pay employees for their overtime rather than accumulate comp time. He pointed out the base cost in 1998 was $37,000. From a management standpoint, B&G felt it was pound foolish to build up a large amount of comp time because employees were not allowed to use that time and, eventually, the comp time was paid off. Mr. Meizel said he wanted the budget to reflect the actual overtime.

The Chair asked for an explanation of training costs found in Decision Unit E-175. Mr. Meizel said a portion of the funds would be used for computer training. Training had also been planned for staff associated with the upgraded energy system in the Sawyer Building. Four employees were being sent to indoor air quality training. He said B&G dealt with air-quality issues on a daily basis. The Chair said it was not that committee members were questioning the need for B&G staff to be trained, rather, the question regarded the increases of over 100 percent in the training line item in each year of the biennium. Mr. Meizel explained a portion of the costs represented training for new employees. He said a policy had been established during the last biennium that B&G would provide significantly more training, particularly in the areas of indoor air quality and heating, ventilating, and air-conditioning (HVAC) systems. He expected the increase in the training decision unit to be maintained in future budgets. The Chair asked that staff be provided a detailed justification of training requests and Mr. Meizel said that information would be provided.

Senator Raggio said staff indicated to him an adjustment may be necessary to the proposed carpet renovation costs. The agency had requested $176,000 in FY 2001 for carpet renovation in the Sawyer Building and indicated the cost would equal 20,000 square yards times $22 per yard. That calculation actually totaled $440,000, not $176,000. Senator Raggio requested clarification. Mr. Meizel said the total square yards needed for the project had been reduced, and the correct amount was $176,000.

The Chair asked if the carpet replacement project at the Belrose Building in Las Vegas had been completed. He noted the legislature had approved $77,000 for that project. Mr. Meizel said contracts had been entered into for that project. He would double-check on the status of the project and provide that information to committee members.

The Chair recognized Mr. Marvel who expressed his concern regarding the HVAC system in the Sawyer Building. He asked why the system in a brand new building required renovation. Mr. Meizel explained there had been a myriad of problems at the Sawyer Building that included significant problems with indoor air quality. He said the State Public Works Board (SPWB) had expended a great deal of money over the last four years in an attempt to resolve those problems. Mr. Marvel asked if the company that had installed the HVAC system was bonded and Mr. Meizel said they were. Mr. Meizel explained the funds requested for HVAC renovation dealt with issues over and above the building’s original design. While re-balancing should be completed from
time-to-time as a general maintenance function, new sensors were being added to the system that would require additional maintenance. Mr. Marvel asked if the architects were responsible for those problems and Mr. Meizel said while he did not agree with the way certain systems had been designed in the building, those issues were water under the bridge. The fact was B&G could not adjust temperatures within the building to accommodate its employees. He explained additional sensors and controls were being installed. Mr. Marvel asked the length of warranties issued on systems at the Sawyer building and Mr. Meizel said standard warranties had been issued for one year. Mr. Meizel pointed out numerous changes had been made in the Sawyer Building since its original construction and B&G had tried to make adjustments accordingly.

The Chair recognized Senator Coffin who commented the companies that had been involved with the construction of the Sawyer Building were probably still in business and making bids on other state projects. He said committee members wanted to be made aware of the names of those contractors and wanted B&G to remain aware of those names relative to the bidding process. Senator Coffin did not feel comfortable with the level of forgiveness by SPWB and the state and asked who the major contractors were on the Sawyer Building. Mr. Meizel deferred that question to Eric Raecke, Manager, State Public Works Board (SPWB). Mr. Raecke replied the major contractor was Kitchell Contractors out of Arizona. He told committee members the contractors built the Sawyer Building exactly the way it had been designed and those designs fell within national standards. He said the Sawyer Building had been designed under very strict American Society of Heating, Refrigeration, and Air Conditioning Engineers’ (ASHRAE) standards. It was his opinion the Sawyer Building had experienced many problems that did not fall within national guidelines. He said there was more dust, spores, and fungus in the Las Vegas Valley than in other areas of the nation. The problem of itchy eyes affected approximately
10 percent of the people that worked in the Sawyer Building, most of those involving employees of the Gaming Control Board. He told committee members the building had been constructed with an 85 percent filtration system which was close to that of a hospital. Mr. Raecke said the early problems in the Sawyer Building included heat control issues, moisture levels, and smell issues. He explained people who lived in Las Vegas were used to a dry climate with a humidity factor of 10 percent. The humidity in the building, however, had been raised to approximately 35 percent, the national standard. Regarding the airflow and smell issues, SPWB had found P-trap primers in restrooms in the building that were not being primed automatically and, as a result, sewer gas leaked.

Mr. Raecke said there had been no less than three nationally-recognized air quality firms assess the Sawyer Building. Each report provided to SPWB indicated the reported problems fell within every Occupational Safety and Health Administration (OSHA) and ASHRAE standard. He pointed out the largest number of complaints came between spring and summer and between summer and fall, when other asthma suffers in the Las Vegas area experienced problems. Senator Coffin asked if the ratio of people in the Sawyer Building with problems was the same as the general population outside the building. He also asked if there was a sick-building syndrome issue at the Sawyer Building. Mr. Raecke said the sick-building syndrome was a nationwide issue and there were, indeed, sick buildings. He told committee members he had been in the construction business 45-years and had been told early on that a building was like a living body, it had to breathe. In order to conserve energy, however, buildings had been closed up and the air was being re-circulated as many times as possible rather than being reheated or re-cooled. It was his opinion the nation had created its own sick building syndrome. Senator Coffin said perhaps buildings should not be carpeted because the carpeting automatically created both dust gathering and out-gassing at the same time. Mr. Raecke agreed that carpeting was a good place to harbor all kinds of dust, fungus, and spores. He also pointed out that each agency in the Sawyer Building had its own large shredder that introduced large amounts of dust to the inside environment. While there were exhaust fans in the building, they were not designed to handle the volume of dust generated by the shredders.

The Chair recognized Mr. Marvel who said if the Sawyer Building was up to code and standards, why was B&G asking for money to upgrade the HVAC system. Mr. Raecke explained the last two air hygienists that had been in the Sawyer Building reported the air environment in the building fell within national standards. The issue was, however, if there were people in the building who reported air quality issues, the state was duty-bound to address those issues. Mr. Marvel asked if the problems were caused by the building. Mr. Raecke said B&G had eliminated 99 percent of building-caused problems, to include the elimination of sewer gas smells, the changing of the filtration system on a regular basis, the regulation of moisture, and the tightening of balancing valves above the ceilings.

The Chair recognized Perry Comeaux, Director, Department of Administration.
Mr. Comeaux told committee members B&G had been struggling with problems in the Sawyer Building for the last four years and, to the best of his knowledge, had done everything possible to correct those problems. The fact remained physicians for a handful of people believed the building was making their patients seriously ill. Mr. Comeaux said the state had recently vacated
2,200 square feet on the second floor and moved those employees elsewhere in the building. That move allowed B&G to tear out the walls and look for fungus. To date, no fungus had been discovered. Mr. Comeaux said there had been a great deal of speculation regarding whether or not the building caused employees to be sick. The fact remained, however, there were physicians who had advised their patients, state employees, not to go back into that area of the building.

The Chair asked why the renovations to the HVAC system had not been scheduled until the second year of the next biennium. Mr. Meizel envisioned the renovation as the frosting on the cake. In other words, the HVAC renovation would not be performed until all other issues with the Sawyer Building had been resolved. Mr. Meizel was confident the building would be given a clean bill of health. The Chair asked how the cost had been determined. Mr. McInnis explained the cost of re-balancing the system had been estimated based on the cost of the original balance job performed at the time the building was opened. The cost of the new sensors and controls had been developed by requesting an estimate from the company that had originally installed those sensors and controls. He said supplier temperature sensors were being added to allow one person to adjust temperatures via computer.

The Chair recognized Mike Meizel, Chief, Buildings and Grounds Division, Department of Administration, to present the budget of the Clear Creek Youth Center.

Mr. Meizel said the Clear Creek Youth Center was originally owned by the federal government until 1969. The state took over the facility in 1970. The center had been given to the state in 1988. He told committee members the center was used by youth group organizations such as the Boy Scouts of America, Nevada Girls State, and Rite of Passage. He said B&G provided custodial-type maintenance to the facility.

Mr. Meizel said it had been a challenge for the state to operate a youth camp and, consequently, the legislature had questioned the state’s involvement. He said the state had entertained different offers of participation at the center in the last year. One offer the state thought might be viable was with the Girl Scouts. The Girl Scouts was interested in a long-term arrangement with the state wherein they would operate the camp. The state would retain the physical assets of the center but would be left out of the maintenance operation. The functions of the center would remain the same.

Mr. Meizel referred committee members to page ADMIN-85 of
The Executive Budget and pointed out there were few enhancements. There were two positions that operated the camp and performed necessary maintenance and scheduling duties. Decision Unit E-710 included the recommended funding to replace 50 twin-size mattresses. Decision Unit E-730 recommended additional funding for the maintenance of the buildings and grounds to include the replacement of furnace burners.

The Chair recognized Senator Rawson who said the legislature had recently received complaints from groups in Las Vegas that said they were unable to use the center because it was rented out to Rite of Passage. Mr. Meizel explained Rite of Passage used the facility during the day for classes, however, an agreement had been reached with Rite of Passage whereby if another group wanted to use the facility, Rite of Passage vacated the site totally. Mr. Meizel added Rite of Passage had been a good tenant and provided the state approximately $30,000 in revenue each year. Because Rite of Passage used a great deal of space at the facility, it was Mr. Meizel’s feeling that group would not remain beyond another two years if the Girl Scouts took over. Mr. Rawson wondered if the best approach regarding the center would be to develop a budget and transfer the entire program to State Parks. Having the facility as part of State Parks would allow for its use by any public entity within Nevada. Mr. Meizel felt if the facility was to be operated as a youth center, it needed someone with expertise and marketing in the youth group arena in control. He said in order for the state to generate more revenue from the center it would have to be refurbished. He pointed out the Girl Scouts organization was in that type of business. Another viable option may be State Parks. Senator Rawson felt strongly the state should retain the physical property and asked if staff would provide estimates of moving the budget of the center under the auspices of State Parks. The information would be provided to committee members.

The Chair recognized Mr. Dini who said it would be important to develop a list of immediate maintenance needs at the center should it be decided to move the budget to State Parks. Mr. Meizel said the center was in need of hard-core capital maintenance work.

The Chair referred committee members to Decision Unit E-730 which requested additional funding over the adjusted base level for seasonal help. He asked why that request was made in view of the fact the performance indicators projected less use of the center. Mr. Meizel said the seasonal help was needed to perform maintenance of the 80-acre, 20-plus building facility. He pointed out staff of Buildings & Grounds (B&G) was also sent to the facility to perform maintenance functions.

The Chair recognized Mike Meizel, Chief, Buildings & Grounds Division, Department of Administration, to present the budget for Marlette Lake.

Mr. Meizel explained the Marlette Lake Water System sat 3-miles above Carson City in the Carson range of the Sierras and was comprised of Marlette Lake and Hobart Reservoir. He said the majority of the water came from Hobart Reservoir and the springs for which the state had water rights. Marlette Lake was used as a backup, primarily during drought years.

Mr. Meizel told committee members the Marlette Lake budget sold water both to Carson City and Storey County and operated with one Watermaster position. He said water sold to Carson City and Storey County was sold through a treatment plant in Carson City. Raw water from Marlette Lake was also sold. Mr. Meizel said the Marlette Lake budget did not contemplate any great departures from the last budget.

The Chair asked Mr. Meizel to comment on the reserve and asked if rate adjustments were anticipated to reduce the drain on the reserve. Mr. Meizel felt that in order for him to provide an answer to the Chair’s question it would be necessary to provide an explanation of the Carson Water Treatment Plant budget because it ran hand-in-glove with the Marlette Lake budget. He explained the revenue in the reserve came from the Carson Water Treatment Plant budget. The reserves were juggled back and forth to support both systems at an even rate. He was not concerned with the level of the Marlette Lake reserve and expected the reserve to increase in the next biennium. He explained B&G was entering into a partnership with Carson City regarding the water treatment plant whereby the state would be removed from the water treatment plant business, but would sell more raw water to Carson City, thus increasing the reserve. Mr. Meizel expected the reserve to increase two-fold by the end of the next biennium.

The Chair recognized Senator Raggio who asked what entity reviewed the amount charged for raw water. Mr. Meizel said contracts already existed that outlined the charge for raw water. Senator Raggio asked the length of the current contract. Mr. Meizel said there were a couple of years remaining in the current contract with Storey County. Raw water was sold to Storey County through the Marlette Lake budget. He clarified water was sold to Carson City through another contract for treated water. Mr. Meizel explained there had been negotiations regarding the raw water sold to Carson City. Senator Raggio was curious regarding the last time the contract had been negotiated and commented on what appeared to be a small charge for the quantity of water received. Mr. Meizel said the cost of raw water was 25 cents per thousand gallons, while Carson City sold treated water at $1 per thousand gallons. He explained there would be a treatment cost incurred at some point. A meter had been moved to another location to alleviate the payment for leakage from the Storey County line when the last contract had been negotiated. That move generated a fair amount of revenue for the state. He felt the 25 cent charge
5-years ago was equitable at that time, and commented the charge was not a "for profit" cost. Senator Raggio wanted to ensure the state received a fair price for the raw water it sold and that the price issue was revisited from
time-to-time. The Senator asked if raw water was sold to Carson City and Mr. Meizel said it was. Senator Raggio asked that committee members be provided with a 20-year history of cost determination for the sale of water and Mr. Meizel said that information would be provided.

The Chair recognized Ms. Evans who asked for an update on the negotiations for the sale of the Carson Water Treatment Plant. Mr. Meizel said the treatment plant would not be sold, but rather, a 3-million gallon tank would be leased to Carson City. The treatment plant, which was not up to the standards of the Safe Drinking Water Act, would remain a possession of the state. He explained the Safe Drinking Water Act had imposed a considerable amount of changes the state would have to make in order to continue operation of the plant. Those changes would cost a fair amount of money. Mr. Meizel felt those maintenance costs would continue for years to come. He explained Carson City had no treatment facility at the time the state originally built its treatment plant. The state had sold treated water to Carson City. Subsequently, Carson City installed a regular treatment facility. At that time, he continued, the state worked out an exchange with Carson City to eliminate duplicate lines. Part of that exchange provided that Carson City would buy a certain amount of treated water from the state. The current negotiations involved Carson City selling water to the state at an attractive rate and guaranteeing to the state that it would purchase a certain amount of raw water. The purchase of that raw water would build-up the water system’s reserve. He said if negotiations were successful there would be no treatment plant budget and approximately
$250,000 would be deferred to the General Fund.

Ms. Evans asked if it were cost effective for the state to keep the treatment plant and Mr. Meizel said he felt it was not. He explained a treatment plant was a fairly small metal building with valves and motors. The state would retain that building and, if it went out of the business of treating water, would sell the valves and motors. The land, however, was of value to the state.

The Chair recognized Mr. Dini who said Marlette Lake was the only source of water for Virginia City, Gold Hill, and Silver City. There had been problems with the raw water reaching those locations at times, and Storey County had spent a great deal of money to construct a facility to treat that water. He said water rates in Storey County had been increased to between $80 and $100 for a small home. He was aware of talk between Storey County, Lyon County, and Carson City, to bring treated water from Carson City through Moundhouse, to Silver City, Goldhill, and Virginia City in which case Storey County would not have to operate its treatment plant. Mr. Dini realized that project was out in the future and at a great expense. He said there were leaks in the system Storey County bought from the state. Last month, Storey County had been billed for
4 million gallons and the county had only billed for 2 million gallons. Mr. Dini said there were a number of complications with the Marlette Lake system that would take time to work out. He said when the state originally purchased the land from Curtis Wright, Storey County had the number one water rights out of Marlette Lake. The county surrendered those rights to the state but were guaranteed they would always have a contract to provide sufficient water for Virginia City.

Mr. Meizel advised committee members he would never take the position the state should relinquish any rights above Carson City on the land or water systems discussed. Those resources, he said, were too valuable.

The Chair recognized Vicki Wright, Executive Director, Sierra Nevada Girl Scout Council, Inc. Ms. Wright explained the Girl Scouts had been in recent conversations with B&G to discuss the Clear Creek Youth Camp proposal. The Girl Scouts wanted to ensure the camp remained accessible to youth groups.
Ms. Wright referred committee members to (Exhibit D), a copy of the Girl Scout’s proposal. She pointed out the Girl Scouts had a long history of operating and marketing youth camps. The council had a camp in California they had run successfully for a number of years. As a non-profit organization, the Girl Scouts could bring to the table the ability to raise money to accomplish some of the capital improvements needed at Clear Creek. Ms. Wright said the Girl Scouts also had a relationship with the Nevada Air National Guard. Guard members had assisted the Girl Scouts with the opening of their California camp for the last five years and had agreed to provide the labor for major capital improvements at the camp. She felt the Girl Scouts would bring excellent resources to the state and increase the value of the Clear Creek Youth Camp. While operating Clear Creek would provide the Girl Scouts with more access, Ms. Wright assured committee members other youth groups would not be denied access. She said the council was willing to negotiate on any and all points of the proposal presented to B&G. Ms. Wright felt the Girl Scouts would be a good partner with the state to operate the Clear Creek Youth Camp.

The Chair recognized Ms. Evans who asked if the Sierra Nevada Girl Scout Council had the opportunity to discuss the contents of its proposal with Mr. Meizel. Ms. Wright said there had been numerous discussions but pointed out there had been no hard negotiations to date. At Ms. Evans’ request, the Chair directed Mr. Meizel to work with the Council to develop an agreement which would then be brought back to the full committee.

The Chair recognized Senator Mathews who said she attended Girl’s State each year at Clear Creek Youth Camp and the condition of the camp was deplorable. She felt very strongly the state should either get rid of the location or improve it.

The Chair recognized Mr. Dini who thought a contract existed between the state and Rite of Passage. Mr. Meizel said the state had a lease with Rite of Passage that had been renewed last fall for six months.

The Chair recognized Eric Raecke, Manager, State Public Works Board (SPWB), to present the FY 1999-2001 capital improvement program.

Mr. Raecke explained 99-C01 represented funding for phase II of the Cold Creek Prison. He was aware there were several questions regarding the status of the phase I project and felt it appropriate to provide committee members with an update. He reported phase I was definitely underway and Sletten Construction of Nevada was acting as general contractor. The completion date was
May 8, 2000. He said there had been delays at the site that were caused by poor plans. The realistic delay, in his mind, was 30 days. SPWB was still committed to a June 2000 ultimate completion date.

Mr. Raecke told committee members at least two lawsuits had been filed; one regarding the copyright of plans from one architect to another. The lawsuit surrounded the design intent regarding the housing units. He reminded committee members SPWB had promised the legislature last session it would follow the same housing unit style. A local architect had made a copyright claim but had not yet filed a suit. The architect firm of Lucchesi, Galati had filed a suit to indemnify themselves. SPWB had filed a counterclaim and felt it was in control of the situation.

Another issue being questioned was the absence of a fence surrounding the facility. Mr. Raecke assured committee members $1.4 million had been set aside in the budget to construct the fence. There would be an operable prison, with a fence, opened by the end of June 2000. The Chair asked if phase II were not completed, would there still be a fence. Mr. Raecke explained the fence for phase I was provided for in the phase I budget and the fence for phase II was provided for in the phase II budget. The Chair asked if the fence was electric. Mr. Raecke said there had been much discussion regarding the installation of an electric-lethal fence. In discussions with Robert Bayer, Director, Department of Prisons, it had been decided to install one-fourth of the phase I fence in electric-lethal and, the balance of the fence to be installed under phase II, would also be electric-lethal. He said the only portion that would not be electric-lethal would be the fence between the pedestrian entrance tower and the vehicle sally port tower.

The Chair asked how the lawsuit filed against SPWB would impact the completion of phase I of the project. Mr. Raecke explained the lawsuit that had been filed by the architect firm of Lucchesi, Galati against the state and Sheehan VanWoert out of Reno, did include a request for an injunction. However, no action had been taken on the request. He commented once a project was underway, most judges were very hesitant to impose an injunction. Mr. Raecke felt phase I would not be stopped. Regarding phase II, the design had been completed regarding the housing unit, warehouse, and additional fencing. He did not anticipate the lawsuit would affect phase II in any way, shape, or form.

Mr. Raecke explained there were presently four housing units under construction in phase I. Those units provided 1,168 beds. Phase II would include four more housing units. If capacity needs increased, those units could be double-bunked and provide in excess of 1,200 additional beds. The Chair said it was his understanding phase I would be opened without the gym, warehouse, or motor pool building. Mr. Raecke explained the gym had never been part of phase I. He clarified phase I included the basic core units, three towers, the water tank, armory, and canine unit and had been awarded at
$83 million and change. 1.4 million of that amount had been reserved for fencing and $500,000 for an additional tower. Mr. Raecke pointed out when those numbers were added together, $2.6 million remained. If for some reason the project were not funded, the warehouse could easily be built within the remaining balance. If push came to shove, the motor pool could be operated out of the Southern Nevada Correction Center motor pool.

The Chair asked SPWB to provide a complete accounting of how the funds approved by the legislature for the planning and design of phase I (CIP 95-G1) and for the construction of phase I (CIP 97-C1) had been expended. Mr. Raecke said staff would be provided that information. The Chair asked when that information could be made available and Mr. Raecke said within one week.

The Chair then asked what affect electric fencing would have on staffing, if any. Mr. Raecke deferred that question to Mr. Bayer. Mr. Bayer addressed the question in two ways. If electric fence was installed between tower 5 and tower 6 in phase I, tower 6 would not be used and tower 5 could be scaled down and only used in case of emergency or foul weather procedures or, if for some reason, the fence line itself was undergoing maintenance. That situation would save .8 full-time positions. Tower 6, one of the corner towers, would require staffing on one shift versus three shifts and use only 1.6 positions. Tower 6 would be staffed during the day when it was involved with the traffic entering the institution. He explained the first section of electric fence would save 3.2 plus 4.8 positions. The second phase would be all electric fence and eliminate the need for two complete towers in terms of staffing. There would be a minimal tower in the very far corner of the prison. He clarified the fence involving towers 1, 2, and 3 was not electric and had 24-hour responsibilities.

Mr. Raecke indicated he had recently held discussions with Mr. Comeaux, Director, Department of Administration and the committee was being provided with a letter indicating SPWB had shown the federal funding on the project would come in at $7.2 million. SPWB had very recently been advised the violent offender program would add another $3.7 million which increased the federally funded share for the project to $10.99 million and thereby reduced the requirement for bonds.

The Chair asked how many towers would be necessary under phase III and
Mr. Bayer replied, assuming the electric fences were installed, none. Phase III would add additional beds and the prison industries area. The Chair said it was his understanding the price quoted to committee members for the construction of one tower in phase I was $537,000 and the quote to construct two towers under phase II was $399,000. Mr. Raecke explained the towers that would be constructed along electric fence lines were scaled down and did not require
24-hour staffing.

The Chair recognized Senator Coffin who felt it was a terrible mistake to rely on electric fencing versus guards. Mr. Raecke explained the best example of
electric-lethal fencing was California which had 80 percent of its facilities using that technology. To his knowledge, there had not been one escape from California’s institutions. SPWB had visited the facility at Vacaville and heard nothing but accolades regarding the electric fence. He understood an
Israeli-type fence had been installed at the southern Nevada facility which experienced problems with the dust. He said an electric fence was a completely different concept. The fence carried absolutely no voltage, but a very high amperage. The only time voltage went through the line was if something or someone got between two of the wires. Electric fences had low maintenance costs. Mr. Raecke explained the technology was tried and true and had been used all over the world, including Africa and Australia. The technology had met the test of some pretty harsh climates. He felt the climate in the deserts of Nevada was no different than the plains of Australia or Africa. Mr. Coffin said so were armed guards and Mr. Raecke said he would not argue with that. Mr. Coffin added the one time the electricity may fail for a few minutes would be the time SPWB would wish they had chosen armed guards.

Mr. Bayer said he understood the Senator’s concerns. He said if the technology were a detection system, like the one that failed at Indian Springs, he would be much more cautious with his affirmations. He explained the electric fence technology was different. There would be a roving patrol at all times in addition to the electric barrier. If the fence went down for any reason, there were towers that would be staffed immediately. Mr. Bayer told committee members he had seen the system in operation and it was, indeed, effective. The institution would continue to maintain a strong presence in the towers and would never take a chance in compromising its security when it came to escapes.

Senator Coffin pointed out that even in good fiscal times, the institutions in Nevada were understaffed and he questioned the effectiveness of a roving patrol. He worried that the perimeters may be understaffed. Mr. Bayer assured committee members that perimeter positions were not compromised due to lack of staff. The existing towers had the ability to see any action on the fence line, but the distance was so far their weapons could not be used effectively. The electric fence would stop the escape while the roving patrol responded. Mr. Coffin asked if Mr. Bayer’s comment regarding weapons meant the tower was beyond the effective range of the rifle and Mr. Bayer said yes. Mr. Bayer said the towers would be able to see someone challenge the fence, the electric fence would be in place to meet the challenge and, at the same time, the roving patrol would be dispatched.

The Chair asked Mr. Raecke to address the single-source selection process. He said if he were not mistaken, the statutes required a contract go out to competitive bid and the legislature would have to enact special legislation to award phase II to Sletten Construction in a single-source selection process. The Chair asked how the completion date of phase I would be affected if there were no statutory modifications. Mr. Raecke reminded committee members the legislature had authorized a single-source selection process for phase II of the Lovelock facility and, during the last session, had authorized a single-source selection process for the construction of the second half of a housing unit at the Warm Springs facility as well. The legislature had also authorized, through the capital improvements bill, the same selection process for the construction of building 7 at the Southern Desert facility. He said history precedent was in place to allow for that type of selection process.

Mr. Raecke told committee members SPWB was placed in a difficult situation when contractors worked in close proximity to each other. If SPWB was allowed to negotiate for the project-in-question on a sole-source basis, the project would be up and running within a few weeks of session-end. Mr. Raecke explained if SPWB was not able to use the sole-source selection process it could easily lose eight months on the short side and one year on the long side in the construction process.

The Chair asked how Mr. Bayer would feel if SPWB was unable to use the
sole-source selection process. Mr. Bayer said he was aware prison facilities had been constructed using the sole-source selection process and it had made a great deal of sense in view of project overlap. It did not make sense to have two different contractors working on the same site, having to screen two different sets of employees, etc. The quicker the project was put together, the cheaper the cost would be to the state. Mr. Bayer said for phase II and the completion of phase I, sole-source would be the only way to go.

The Chair recognized Ms. Evans who felt the committee was moving forward with the assumption phase II would go forward. The three variables in her mind were cost, timing, and beds. She told Mr. Raecke she needed to understand the differential of the cost of sole-sourcing versus cost of delaying and negotiating. Additionally, Ms. Evans needed to understand better the number of beds that were required and how many new beds would be gained with phase II as the result of adjustments in other facilities. She said committee members had been advised the Jean facility would be closed which would represent a loss of 613 beds. When the Cold Creek prison was opened, there would be a net gain of 395 beds. Phase II would only provide a net gain of 882 new beds. Committee members had also been told 745 beds would be closed in other facilities when phase II opened and that resulted in a net gain of 137 beds until the 224 beds at Nevada State Prison (NSP) were reopened. It was imperative that committee members understand the necessity to go forward with phase II immediately. It did not appear there would be a large gain in beds with the opening of phase II. She reminded committee members of the great pressure imposed on the legislature to open the Lovelock facility and the fact that facility had been mothballed for the better part of a biennium. Ms. Evans said she was having difficulty sorting out the facts. She said she could not tell SPWB today that she could support going forward with phase II on the basis of the information committee members had received to date.

Mr. Raecke spoke directly to the cost. He explained because unit prices were established in September 1998, a sole-source selection process would provide for those unit prices to stay in effect. If SPWB moved forward with a
design-bid award, a year in construction time would be lost. He explained a year in the construction business at the annual inflation rate in southern Nevada of somewhere between 4 percent and 5 percent, would represent a $2 million to $2.5 million loss when applied to a $50 million project.

Ms. Evans asked how much would be saved if the facility were not operated.
Mr. Raecke was only able to speak to pure construction costs and turned to
Mr. Bayer for the response. Mr. Bayer said the Nevada Department of Prisons (NDOP) would attempt to attach a report to the population identification information that was to be provided to committee members and staff no later than Friday, March 19, 1999. That report would attempt to state the complexities of the project in layman’s terms, as clearly as possible. He agreed with Ms. Evans that it was difficult to get a grip on the facts.

Mr. Bayer clarified phase II would provide 1,000 additional beds, not 882 beds as Ms. Evans had said. The 1,000-bed figure was predicated on 165 percent to
170 percent double-bunking. He explained some cells could not be
double-bunked because of their use, i.e., disciplinary or isolation cases. NDOP would attempt to provide committee members with a 1-page summary to spell out its choices and exactly what direction the department would take in view of the new projections it had just received.

The Chair recognized Senator Raggio who said he also did not have a handle on the number of beds, where they were located, and when. He felt it was extremely important committee members and staff be provided with a full chart of inmate population, scenarios of facility closures, and where the population would end up. The Senator asked if the Lovelock facility has 125 beds that were not in use due to lack of staff and Mr. Bayer replied that was correct. Mr. Bayer clarified that situation did not necessarily mean the population at the facility had been lowered. There was confusion surrounding the double-bunking issue and Senator Raggio asked why all facilities could not be double-bunked and alleviate the necessity for a new facility. Mr. Bayer said there were many temporary solutions NDOP had used over the past years in an attempt to deal with the burgeoning population and had tried to make adjustments in the most cost-efficient manner. There were times the population in a housing unit was increased in a core that was not designed to handle that amount of inmates, but it was done because there was no other choice. That situation added stress to the core, i.e., the manner in which the facility was designed to operate. At some point, he said, the expansion of NDOP facilities was designed to reduce the situation back to emergency capacity. NDOP was currently operating above emergency capacity.

Senator Raggio asked what NDOP planned to do with the 125 vacant beds at the Lovelock facility and at what point in time would those beds be of any use. He also asked the status of the Warm Springs facility. Mr. Bayer said the Warm Springs facility had been expanded to provide for the new WINGS program and the new therapeutic community. Two new half units had been constructed. It was his understanding one of the half units remained unoccupied due to lack of staff. That half-unit represented 125 beds. Senator Raggio asked why there was difficulty in recruiting and maintaining staff. Mr. Bayer felt that question was very complex. He said all of the western states were experiencing difficulties in recruitment and retention of correctional officers. Senator Raggio asked if that was because of salary, and Mr. Bayer said that played a part. One of NDOP’s initiatives regarding the Lovelock facility was to add the rural area differential (RAD) pay. While Nevada ran one of the best prison systems in the country, there was a great deal of negative press and prospective hires questioned their employment with NDOP. He felt very strongly that somehow NDOP needed to enter new career markets wherein a person would want to work for NDOP. The mindset needed to be established that identified a correctional officer position as good and rewarding employment. Senator Raggio said he was very mindful of the security of the public and the need for punishment, however, he did not want the state to build prisons if they were not necessary. He again wanted to get a handle on what beds could be used to obviate the necessity for building another prison, or even another phase of a prison. The Senator pointed out a 60-bed unit at Northern Nevada Correctional Center (NNCC) was empty and he requested a report on the utilization of that facility. He also wanted a justification for NDOP’s proposal to build a new prison at considerable cost when all these existing beds were unused.

The Chair reminded both Mr. Bayer and Mr. Raecke that NDOP and SPWB had guaranteed the completion of the Cold Creek facility by August 1999. He felt that date had been forgotten and now NDOP was attempting to figure out a way to create a new completion date and asked the issue be addressed. Mr. Raecke explained the August 1999 date was SPWB’s original package. As committee members were aware, a bid was challenged and, in a bid protest, the project had to be re-bid which resulted in a delay of 3-months. He realized that delay did not make up the difference of the remaining 9-months and he guessed he had made a lousy prediction for a completion date. Since SPWB had met with the Interim Finance Committee (IFC) six to eight months ago, it had stayed within the May-June 2000 finish date.

The Chair asked for clarification regarding the lawsuit. Mr. Raecke explained there had been a suit on the part of the architect, and a counter-suit by the state. He did not believe the lawsuit had any impact on the completion schedule whatsoever. The Chair asked if the contractor had been made aware of the August 1999 date at the time it received the bid or, were they under the impression the date was open-ended. Mr. Raecke explained the bid package specified 18-months of construction time, and 18 months from the date of the "notice to proceed" would be May 8, 2000. The contractor did not set the date for completion, but rather, that date had been identified in the bid document.

The Chair asked if the legislature closed the Southern Nevada Correctional Center (SNCC), did NDOP have any plans to reopen that facility. Mr. Bayer said a reopening of the facility was not in its proposal, but he had not yet had the opportunity to review the new forecast of the population projections. He said a reopening of the Jean facility would depended on whether or not NDOP moved forward with phases I, II, and III. The Chair requested a list of the furnishings and equipment included in phases I and II of the project. Mr. Raecke said he had already sent a list of equipment to staff and had promised to fine-tune that list and provide any new information to staff as appropriate.

The Chair questioned Mr. Raecke’s earlier testimony wherein he alluded to
$2.6 million in unobligated funds from phase I and asked if those funds could be used for phase II. Mr. Raecke said at that time he would certainly not want to commit any money in view of the fact SPWB was only 5-months into an
18-month project. He pointed out the $2.6 million was slightly less than
3 percent. To not hold that amount in contingency would be a tragedy. If there were any money left in the bank at the end of the project it would be reverted to the General Fund.

The Chair recognized Mr. Marvel who asked the total number of vacant beds in the men’s correctional system. Mr. Bayer did not have that information with him but would include that figure in the information being provided to committee members on March 19, 1999. Regarding recruitment, Mr. Marvel asked if there was any adjustment that could be made, other than salaries, that would make the job of correctional officer more palatable. He asked if the state’s standards were too high for people to qualify for the position. Mr. Bayer said the Peace Officer Standards and Training (POST) had instituted new physical requirements for all peace officers. Correctional officers were required to pass the same physical agility requirements as Highway Patrol troopers and Washoe County deputies. That had been a stumbling block for many of the applicants. On the other hand, he noted, the new hires were healthier. The hope was there would be lower costs in terms of injury, sick time, etc. The testing requirements for the position of correctional officer were not that difficult. Only a high school diploma was needed to compete for the position. Mr. Bayer said the problem was the current economic climate and that, in view of that positive climate, individuals were not looking for employment as correctional officers. The entire west coast was facing the same situation. He explained Arizona was in a crisis with 1,500 vacant positions and had hired consultants to study the problem.

Mr. Marvel asked if private companies were having the same types of recruitment problems. Mr. Bayer said he had never studied that issue across-the-board. It was his observation that private companies seemed to be able to staff better than state systems. He commented the medical division at Ely had done a better job than the state was doing prior to the privatization. Mr. Marvel asked if NDOP had compared its requirements to those of private companies. Mr. Bayer said the requirement of private companies would be different because employees of private companies were not considered peace officers and did not have to meet the same physical requirements as the state. While
private-company employees had to become POST certifiable, they were not actually required to graduate from POST. Mr. Marvel said perhaps the state standards should be lowered to those of the private companies. Mr. Bayer responded he had approached the POST committee on changing the physical requirements for the correctional officer position and the committee did not want to move in that direction.

The Chair recognized Mr. Dini who felt the situation of disparity in salaries had gone on far too long and would only get worse. He felt the economy would continue to grow in its current direction and pointed out there were a number of new jobs being created in Fernley that might draw people away from Lovelock. Mr. Dini said it was his understanding that most employees at the Lovelock facility lived in Fallon due to inadequate housing. It seemed to him moving on the issue of empty beds was more important than considering the construction of a new prison. Mr. Dini asked if anything could be done to expedite the use of vacant beds. Mr. Bayer agreed with Mr. Dini the vacant bed issue should be expedited and that was one of the reasons he had approached the POST committee regarding physical requirements for correctional officers. He pointed out salaries were a legislative issue. Mr. Bayer was not sure how vacant beds could be filled without further decreasing the density of staffing at other locations and thereby create another difficult problem. Discussions had been held regarding the possibility of placing minimum-custody inmates in some of the facilities with vacant beds and then staffing those facilities with fewer officers based on the inmate’s lower security rating. That scenario, however, raised the issue of those minimum-custody inmates being inside fence lines. He stressed the fact that while there may be vacant beds, NDOP was housing the same number of inmates even though they may be housed in a different area within facility perimeters.

Regarding the list of furnishings and equipment staff had requested, the Chair commented on the length of time it had taken to obtain that information.
Mr. Raecke said SPWB had provided a fairly good list of material to staff on
March 3, 1999 and staff had requested two portions be fine-tuned. He felt
80 percent of the request was accurate and would provide the updated information by the end of the week (March 19, 1999).

Mr. Raecke explained CIP 99-C2 would add a housing wing to the Silver Springs Conservation Camp. The building was originally constructed with two housing wing units and the option to add another housing wing that would add 56 new beds. SPWB felt the design time could be very short because it had already reviewed the project and, if funded, the construction could be completed in
8-months. The new wing could be brought on-line by June 1, 2000. He explained that although the sewer plant required more leach field to receive the additional sewage effluent flow, it was large enough to handle the addition. SPWB said the camp had sufficient well capacity to accommodate the addition. The project totaled $756,986.

Senator Raggio asked for a firm date regarding the project’s completion. Mr. Raecke said his calendar reflected June 1, 2000. Senator Raggio noted the operating and utility costs, and additional Forestry supervisors outlined in
The Executive Budget were based on a completion date of December 2000 and asked which date was correct. Perry Comeaux, Director, Department of Administration, said he would verify the date and provide that information to committee members.

Mr. Raecke explained CIP 99-M27 was a recommendation to fund the upgrade of sewer treatment plants at Southern Nevada Correctional Center, Lovelock Correctional Center, Pioche Conservation Camp, and Ely Conservation Camp in the amount of $616,388. He said those upgrades were necessary to meet stringent health standard requirements.

The Chair asked Mr. Raecke to explain the status of CIP 91-M7 and asked if the project had been completed. Mr. Raecke said he was not prepared to discuss that project, but would provide that information to committee members.

Mr. Raecke explained CIP 99-M28 was a recommendation to replace the fire hydrants at the Southern Nevada Correctional Center (Jean). The prison had been in existence for approximately 20-years. The water encountered in that geographical location was extremely hard and corrosive and had worn out all of the fire hydrant valves. SPWB felt it was possible the state may incur an extreme liability if there were a fire at the facility. The Chair asked if the valves worked and Mr. Raecke said that while they were extremely hard to open and close, they did work. The Chair questioned the $28,000 security cost for repair of the fire hydrants and asked how that amount had been determined. Mr. Raecke explained the security cost was always based on a project being performed inside an active fence line. NDOP had always requested one to two guards accompany a construction crew and its equipment. He was not sure how the exact figure was derived, but the normal calculation was number of hours for length of project. He explained the project would be very laborious. The entire system could not be shut down at once and a certain level of fire protection had to be maintained. The Chair asked why the project was necessary if the facility would be closed. Mr. Raecke said if the facility was shut down and inmates were moved to another facility that move would not occur for at least one year. During that interim, fire protection would be necessary.

The Chair recognized Mr. Marvel who asked which agency provided water to the Jean facility. Mr. Raecke explained while there were some wells, the majority of the water came from Jean proper. Mr. Marvel said the aggressive water in southern Nevada had been a problem for many years and thought the problem had been remedied when the facility switched water providers. He asked if the provider had any responsibility to purify the water and Mr. Bayer said yes. He told committee members the damage had been done over the years the system had operated with water of a harder quality. Mr. Marvel asked if the same water source was being used by the new supplier, or was it imported. Mr. Bayer said it was his understanding the Las Vegas Valley Water District was the supplier to Jean and the water came from a source other than the Peter Simon well which had been abandoned.

The Chair recognized Thomas Glab, Chief of Plant Operations, Nevada State Department of Prisons. Mr. Glab explained the problem with the fire hydrants at the Jean facility involved a problem with the valve for the stand pipe of the hydrant. When a hydrant was opened, the stand pipe filled with water. Then, when a hydrant was closed, the stand pipe was supposed to drain into the ground. For some reason, though, the drains had been concreted over and no drainage was allowed. Mr. Glab pointed out SPWB’s major concern was whether or not the hydrants could be operated in the event of a fire.

The Chair expressed his concern regarding the requested funds for CIP 99-M28 in view of the fact the Jean facility may be closed. He also questioned whether or not CIP 91-M7 and CIP 97-C11 had ever been completed at the Jean facility. He said committee members were concerned SPWB was asking for additional funds this biennium for the completion of new CIP projects when it had not completed old projects. Mr. Raecke said he would provide committee members with the status of CIP 91-M7. He pointed out that 97-C11 had been funded less than 18-months ago. He said when he took over SPWB 3 ½-years ago, there were in excess of 240 projects to be completed. The project list was now less than half that amount.

Mr. Raecke explained each housing wing had a power-activated sliding door. The recommended $518,159 would replace the headworks of 21 gates at SDCC. He said the gates had been breaking down on a very consistent basis and were old and worn out. SPWB had received an estimate to install new headworks at a cost of $17,000 per unit. Mr. Raecke clarified the project would replace the mechanical powering and driveworks of each gate.

Senator Raggio asked why there was an architect and engineering (A&E) cost of $40,000 for replacement of motors and chain drives. Mr. Raecke explained the replacement costs incurred under A&E design and supervision would provide for adaptation of new units, if necessary.

The Chair asked why a provision for security costs had not been built into the budget. He also asked if Southern Nevada Correctional Center were closed, as recommended in The Executive Budget, would there be sufficient bed space to allow for the removal of inmates from the housing wings so the project could be completed. Mr. Raecke explained the type of work required for the replacement of the gateworks was performed by a highly-technical security company that worked inside prisons on a regular basis. NDOP had not felt it necessary to have the same security requirements as it would have provided for a project being performed on the yard. The gates would be replaced under the observation of the guard station in each rotunda. He explained inmates would be moved for up to two days when SPWB was completing those types of projects. Mr. Bayer added there was a minimal amount of space between the guard station and the gate. Additionally, there was staff available to watch the project as it was finished.

Mr. Raecke explained CIP 99-M30 would replace the original concrete and masonry shower stalls at Nevada State Prison (NSP). He said the Health Department mandated those shower stalls be re-painted at least once, if not twice, a year. Each time the shower stalls were painted, those facilities were completely out of service for five days. The recommended funding of $198,959 would replace existing shower stalls with stainless steel, a surface that was very easily cleaned and durable to water. The Chair questioned the $27,563 that had been built in to the request for prison security costs. In addition to a further distance existing between guards and the shower facility, the workers that would be installing the new shower stalls did not normally work inside prison walls. In view of the Chair’s question, Mr. Raecke said he would recalculate the costs for additional prison security for all CIP projects to ensure those amounts were correct. Mr. Bayer said unlike the first NDOP’s project regarding replacement of gate hardware, NSP housed a different caliber of inmate, and the showers were located in what might be referred to as a blind spot which required a totally different approach to security.

The Chair recognized Mr. Marvel who asked if Prison Industries could make the stainless steel shower units and pointed out they had done a lot of work for the Lake’s Crossing facility to include toilets, urinals, and basins. Mr. Bayer responded he was not sure if Prison Industries had the tools and equipment to weld the stainless steel, but would find out and provide that information to committee members.

Mr. Raecke explained the vehicle gate at Southern Desert Correctional Center (SDCC) had been damaged by inmates who had liberated the garbage truck and had driven it through the sallyport. The gate had not worked properly since that time. Also included in the recommendation was the request for a mechanical device that would prevent that type of occurrence in the future. The device was typical of the barricade devices surrounding government buildings and would be a bollard-type device that would have to be retracted before a vehicle could reach the sallyport gate. SPWB had requested $210,248 for completion of the project.

The Chair said he had several concerns regarding the project. First, since the inmates caused the damage, had there been any thought to take the repair costs from the Inmate Store Fund. If that was not a possible alternative, had any thought been given to an insurance policy covering the cost of repairs. Mr. Bayer would look into those issues and provide committee members with a response. The Chair asked if there had only been one incident, was it really necessary to install the mechanical device. Mr. Raecke said it was his understanding there was only one occurrence and the garbage truck was no longer left inside the fence. The Chair asked Mr. Raecke to provide committee members with a recalculation of the request based on the responses from Mr. Bayer and the fact there had only been one occurrence.

Mr. Raecke explained CIP 99-M32 was the result of a decision that had turned out not to be in the best interests of the state. Four Enterprise diesel generators had been purchased from an airforce base to provide backup power at SDCC.
CIP 99-M32 represented the replacement of one of those generators. He told committee members SPWB had laid an extra pair of conduits between prison 7 and SDCC. At some point in the future those conduits would provide generating capacity from prison 7 for SDCC. He said SPWB had oversized the generator capacity at prison 7. He noted one generator at SDCC was totally inoperable.

Mr. Marvel asked if the plan was to have backup power for both Cold Creek and Southern Desert. Mr. Raecke said the extra conduits had been laid to run backup power from Cold Creek. Mr. Marvel asked how many generators were needed to generate the capacity needed in the event of a blackout. Mr. Raecke said prison 7 currently had two large generators and would be expanded to four generators when the facility was at full-phase. There were three large caterpillar diesels that ran the Lovelock facility. He explained at the time the Lovelock facility was built, SPWB had installed extra generator capacity with the idea the power company would buy some of that back. That agreement had never transpired.

The Chair recognized Ms. Evans who asked if NDOP had ever looked into the possibility of bulk purchase of energy and Mr. Bayer said they had. Ms. Evans asked for a report regarding NDOP’s findings and Mr. Bayer said that information would be provided. Mr. Raecke said they had approached the gas company to be considered in the large-use category and, simply by processing simple paperwork, had effected a rate change. SPWB had saved the state $40,000 per year, per institution. Ms. Evans asked if those savings had been factored into NDOP’s budget. Mr. Bayer said he would provide committee members with that information.

Mr. Raecke explained CIP 99-H1 would add a new Highway Patrol facility in Las Vegas, the first phase of a long project over many years to create a new public safety building complex. He explained the offices of DMV, Public Safety, Parole & Probation, Highway Patrol, and several others were spread all over the city. Some of those facilities were houses that had been given to the state over the years and should be torn down. Ultimately, the public safety complex would house Highway Patrol, Parole & Probation, the Investigation Division, POST, the State Fire Marshal, and the Bureau of Enforcement.

CIP 99-H1 was a 60,000 square foot building. He pointed out to committee members $2 million had been placed in the requested funding amount for site acquisition. SPWB had been approached with several land offers and the state, itself, owned a 6-acre parcel near the Bradley Building. The response time to the highway system from that location, however, would be poor. SPWB had also talked with Clark County regarding a parcel of land it owned in its complex center however, the cost of that land at $6 per square foot was prohibitive. There had been lengthy discussions with the Department of Transportation (NDOT) which owned a piece of land near Vacation Village at the southern end of Las Vegas. The parcel was approximately 13 ½ acres that could accommodate the safety complex long-range. That land could be transferred to SPWB at no cost. In its discussions with the Department of Transportation, SPWB had learned NDOT would be constructing a new freeway management system and would perhaps want to enter into a joint-partnership for development of the 13 ½ acre site. If the land came at no price, the requested project amount of $12,114,476 could be scaled back approximately $2 million. Mr. Raecke explained the project would be funded entirely from state Highway Funds.

The Chair recognized Lt. Mark Malloy, Nevada Highway Patrol-LV (NHP), who explained the agency’s current facility had been built in three phases, the majority of which was 25-years old or older. He had been told by Buildings & Grounds (B&G) representatives in Las Vegas if the building were vacated, it was their intent to demolish the building. The number of staff in that agency had doubled since it had moved into the building 13-years ago. The agency anticipated that increased staffing trend to continue. While NHP realized its square foot request might be a little higher than its current needs, it was the agency’s intent to plan for future growth.

The Chair asked how the 60,000 square footage had been determined. Mr. Raecke said SPWB had performed a study 2-years ago when it had looked as if the Las Vegas City Hall would be sold or leased-back. From that study, SPWB looked at both the short-term and long-term needs of NHP and extrapolated to the 60,000 square foot number. A copy of that study would be sent to staff. The Chair asked the square footage of NHP’s current facility and Lt. Malloy said approximately 25,000 square feet.

The Chair requested a status report regarding CIP 97-H4, the expansion of an existing NHP repair shop. Mr. Raecke said that project had gone to bid and had come in well over the budgeted amount. He said the project had been put on hold and, if CIP 99-H1 received approval, the funds from CIP 97-H4 would be rolled over. The Chair asked if the state owned a parcel of land near the Las Vegas Metropolitan Police Department and Mr. Raecke said he had looked at the parcel and did not want to construct a building that would be immediately
land-locked. The Chair requested SPWB look at that parcel of land again, and Mr. Raecke said he would.

The Chair recognized Colonel Mike Hood, Chief, Nevada Highway Patrol who said NHP had looked at the parcel of land near the Las Vegas Metropolitan Police Department and was concerned not only about the commercial and residential development ongoing in the area, but the difficulty its troopers would experience responding to the surrounding freeways. Mr. Raecke added if for some reason the deal with NDOT fell through, there were several other parcels of land owned by NDOT that were excess right-of-way properties that could be considered.

The Chair recognized Mr. Perkins who asked if NHP has looked at the Las Vegas Metropolitan Police Department and some of its properties, particularly near the communications center. He said those parcels seemed to be logical locations for the public safety complex. Lt. Malloy advised the current location of Metrocom at Las Vegas Boulevard and Russell was being moved. It was his understanding the Circus Circus Enterprises owned the remainder of the property in that area. He said NHP had looked at one parcel of NDOT
right-of-way near Vacation Village that would provide excellent interstate access where I-15 and 215 came together.

Mr. Raecke explained CIP 99-H2 recommended funding for covered parking at the present NHP facility. He said the heat in Las Vegas shortened the life of the very expensive electronic and technical equipment found in patrol cars. Covered parking would provide some relief from that heat. In order to get into a car that had been locked up in a parking lot in the sun, a person almost had to put gloves on to keep from burning their hands. That was especially true of troopers that may have to reach immediately for a shotgun. Mr. Raecke said that even if CIP 99-H1 was funded today, it would be another two years before a new NHP building was completed and the need would still exist to provide covered parking in the interim. The Chair asked if covered parking were built could it be torn down and moved to a new location. Mr. Raecke said the foundation would remain, but the superstructure could be moved. If funded, Mr. Raecke would ensure the structure could be moved.

Mr. Raecke explained CIP 99-C3 recommended funding for construction of the readiness center portion of a new state command complex for the Nevada National Guard. He told committee members there would be a 75 percent federal match of funds. An appraisal had recently come back on the land currently occupied by the National Guard at approximately $6 million. That land could be either sold or other state agencies could be relocated to the property. He said the new facility would be constructed on a 28-acre site adjacent to the Nevada State Prison in Carson City. In June of 1998, SPWB had approached the Interim Finance Committee (IFC) to accept another $440,000 from the federal funds to complete the design. The project could be put out to bid immediately following session-end.

The Chair said the biggest concern of the committee was why the state’s share of the costs did not seem to equal 25 percent of the total cost for the project, but rather, the state requirement would be 33.2 percent. Committee members had been provided with information that indicated the state would pay for surveys, soil analysis, structural plan check, mechanical plan check, electrical plan check, etc. The Chair recognized Major Terry Sullivan, Army National Guard, who explained the federal match was solely for construction costs. The additional costs mentioned by the Chair would be borne by the state. The Chair requested Colonel Sullivan provide staff with a breakdown of the 75 percent match of federal funds.

The Chair recognized Mr. Marvel who asked the name of the appraisal firm and
Mr. Raecke said Johnson Perkins Associates. Mr. Marvel asked if the $6 million was a ballpark number and Mr. Raecke said it was a good appraisal performed by a recognized appraisal company. Mr. Marvel commented the location on Highway 395 South was an extremely prime location and Mr. Raecke agreed.

Mr. Raecke explained CIP 99-C6 provided for additional warehouse space and expansion of shops at three conservation camps in Tonopah, Ely, and Indian Springs. He said the construction cost breakdown reflected costs of materials only. The physical labor of the project would be performed by forest service crews. Mr. Raecke said the architect and engineering design and supervision request for $30,000 was to address structural issues and felt that number could be reduced by half.

The Chair asked Mr. Raecke to describe how the current shop space at the Ely Conservation Camp would be used if new facilities were built. Mr. Raecke deferred that question to Roy Trenoweth, State Forester, who said the new building would be used for metal and wood fabrication, upholstery work, vehicle repair, and maintenance. Through the gracious donation of Senator Jacobsen, a
30’ x 50’ metal building at Truckee Meadows Community College would be disassembled and moved to the Ely site.

Mr. Trenoweth referred committee members to (Exhibit E), a copy of the lease between the County of White Pine, Nevada and the State of Nevada that provided for the lease of land at the price of $10 per year for 20-years. The lease also provided for the location of two steel buildings on the property. It was forestry’s desire to separate the auto body and paint shop from the wood and upholstery work. He said the surrounding rural area had expressed his concern about the extreme fire hazard.

Mr. Trenoweth then referred committee members to (Exhibit F), a copy of a letter from the district engineer for the Department of Transportation-Elko which stated if a separate paint booth or shop could be constructed at the Ely camp, its revenue could be enhanced approximately $40,000 per year as provided for in a 1997 letter of intent. The Chair expressed committee member’s concerns regarding the transportation of inmates from the camp to another location to perform the work. Mr. Trenoweth said the location was in east Ely, near the airport. He explained inmates were currently transported to the Ely District Ranger office. Upholstery work was performed in an old trailer and the existing shop at that location which was described as ancient. He explained the existing location had been used since 1985.

Moving to the Indian Springs Conservation Camp, Mr. Trenoweth said the recommended funding would provide for a 2,000 square foot warehouse. He explained there was no warehouse for supplies and equipment in the southern part of the state. The Chair asked why the breakdown did not provide the cost for paving. Mr. Raecke indicated he would look into that issue and provide staff with the information.

Mr. Raecke explained CIP 99-C18 recommended funding for the construction of an 8,000 square foot region II office complex in Elko. He explained the agency would bring in slightly less than one-half the funding ($1 million). The building would be constructed on the campus of the Nevada Youth Training Center (NYTC) slightly north of Elko. He said the Department of Forestry currently had a building at that site and the Department of Agriculture would be relocating to that site in the future. The total cost of the project was $2,169,705.

The Chair asked Mr. Raecke if the agency had funds available to complete the project and he responded he had been assured by Director Pete Morros the funding was available. The Chair recognized Terry Crawforth, Administrator, Division of Wildlife, who advised committee members federal funds would be used from hunter education and boating funds. An additional $300,000 was expected from the sale of the existing building and the balance would come from the wildlife reserve account.

The Chair recognized Mr. Marvel who asked if the complex in Elko had been appraised and Mr. Crawforth said an appraisal had been performed several years ago when the City of Elko wanted the facility for a new firehouse and at that time it appraised out at $300,000.

Regarding the agency’s dispatch equipment, the Chair asked how its old equipment would be affected if the funding for the new microwave equipment for the interagency dispatch center was not approved. As Mr. Trenoweth recalled, there had been a microwave fee of $50,000 that was inadvertently left off the project for the Elko Interagency Dispatch Center during the last biennium. Mr. Raecke said the request for the microwave equipment had been submitted as a one-shot appropriation. The estimate was for $147,500 that had been received approximately 8-months ago.

The Chair recognized Rick Combs, Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. Mr. Combs asked if the interagency dispatch center would be functional if the microwave equipment was not approved in
CIP 99-C18. Mr. Raecke said the present dispatch center was functional, however the enhancement was necessary to increase band width.

Mr. Raecke explained CIP 99-C19 was a request for funding in the amount of $139,000 to add 366 square feet to the Minden facility. The project would also include some minor remodeling. He explained since the project had been built several years ago, there had been an increased number of incident calls. Expansion of the building was necessary to provide dispatch floor space for the addition of consoles. The project would be added to the west side of the dispatch room and the facility would not have to be shut down during construction. The Chair asked if other agencies would use the facility and, if so, why those agencies were not contributing to the cost of the project. Mr. Trenoweth replied the project was for the upgrade of an interagency dispatch center. There were two federal agencies involved, namely, the Forest Service and the Bureau of Land Management (BLM). He said the building had originally been constructed with state General Funds and he felt it was best to continue with state General Funds.

The Chair recognized Mr. Marvel who asked if inmate crews were used and
Mr. Trenoweth responded inmate crews were used for the helitac at the center.

There being no further business, the meeting was adjourned at 12:11 p.m.

RESPECTFULLY SUBMITTED:

Debbie Zuspan,

Committee Secretary

APPROVED BY:

Assemblyman Morse Arberry Jr., Chairman

DATE: