The Assembly Ways and Means and Senate Finance Joint Subcommittee on
Public Safety, Natural Resources, and Transportation was called to order at
8:28 a.m., on Thursday, April 8, 1999. Chairwoman Chris Giunchigliani presided in Room 2134 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List.

ASSEMBLY SUBCOMMITTEE MEMBERS PRESENT:

Chris Giunchigliani, Chairwoman

Mrs. Vonne Chowning

Mr. John Marvel

Mr. Richard Perkins

SENATE SUBCOMMITTEE MEMBERS PRESENT:

Senator Neal

Senator O’Donnell

Senator Jacobsen

Mr. Bob Price (Excused)

STAFF MEMBERS PRESENT:

The Chair recognized Debbra King, Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. Ms. King told committee members the detailed number changes reflected on the budget closing document primarily related to The Executive Budget modification number 99 which proposed significant changes to this account. Those changes related to more accurately identifying costs associated with the services provided by the Public Safety Information Services account. She said costs were separately identified for the Law Enforcement Message Switcher (LEMS) account and programming and network support. In addition, adjustments had been made to telephone circuit charges, vacancy savings, and rents. All of those technical changes required adjustments to revenue charges.

Ms. King explained the objective of the account, which had been established by the 1997 Legislature, was to allow the Department of Motor Vehicles and Public Safety to correctly allocate information services costs among its user agencies. During the 1997-1999 biennium the department was to directly charge costs for programming and network support to the appropriate user agencies. The 1997 Legislature allowed the department to transfer authority between budget divisions with similar funding sources to allow the director of the department to utilize the information services resources as he or she deemed appropriate. The individual user agency would then be able to pay for services received. The department, however, had not executed the plan. Ms. King said the subcommittee may wish to provide a letter of intent to have the department report to the Interim Finance Committee (IFC) in May of each year on how the resources of this account were utilized and how the services were charged. At that time, if necessary, a work program could be developed to transfer authority between budget accounts. She said that program would require specific language in the Appropriations Act to allow the director to transfer authority among budget accounts as needed to support payments to this account for services received.

The Chair told committee members the legislature had given the Department of Motor Vehicles and Public Safety the authority to directly charge costs for programming and network support to its user agencies and that authority had not been followed. If the subcommittee wanted to leave the agency with the authority, it would have to be done through the Appropriations Act and a letter of intent. The agency would report back to IFC on how those funds had been shifted.

The Chair recognized Senator Jacobsen who thought a letter of intent would provide necessary accountability.

Continuing, Ms. King explained the technical adjustments to the numbers portion of the budget closing document had been prepared by staff. The maintenance costs for the Hot Site backup had been adjusted back to the amount provided when the Hot Site was approved by the 1997 Legislature. Insurance on the Hot Site was adjusted to reflect actual amounts currently paid for the system in Carson City. She said telephone circuit charges had been moved to a separate category to more clearly separate those charges. Inflation calculations had been corrected as well. Furniture for the new positions recommended in Decision Unit M-200 (three Computer Network Specialists and one Computer Network Technician) had been eliminated based upon the department’s response to questions by staff. Computers and software had been added for the new positions. The new positions would provide one computer support person per approximately 300 users. She said that level of support was consistent with other state agencies.

Decision Unit M-200 also included $35,000 in each year of the biennium to contract for and obtain expertise on communication among the various protocols across the various operating systems that accessed LEMS. She said The Executive Budget also recommended $62,304 for maintenance costs for routers and modems. Funding for development of the Oracle Database was recommended at $572,760 in FY 2000 and $133,060 in FY 2001.

Ms. King told committee members Decision Unit E-197 had been adjusted to represent the projected telephone cost increases for the 1999-2001 biennium. The adjustment to $226,652 represented a 148 percent increase over the
FY 1998 actual telephone costs. She said the department had indicated those additional costs were due to the increased transmission of fingerprint images and the change to client server technology that required installation of new circuits to provide for increased bandwidth. Ms. King said the subcommittee may wish to include a letter of intent that specified the category for telephone circuit costs was intended to be used solely for telephone circuit and line costs. She felt the letter of intent was necessary because the department had provided a circuit cost during the 1997 legislative session that indicated those costs would be $316,000 when, in fact those costs were $153,000 in FY 1998. The Chair asked Ms. King for the cost-to-date in the category of telephone line charges and recognized Allan Rogers, Manager, Public Safety Information and Technology. Mr. Rogers told committee members he would provide that information. The Chair requested the information contain a breakout of dollars to the criminal history repository and Mr. Rogers said it would.

The Chair recognized Senator Neal who questioned the costs for electronic fingerprint imaging. Ms. King explained the department had installed electronic fingerprint machines in its large facilities and many of the rural areas as well. Those machines sent the fingerprint electronically into the criminal history repository. More bandwidth would be required to transmit the increased number of fingerprints. Senator Neal asked if a transmission included a full set of fingerprints or just a thumbprint and Ms. King responded a full set.

The Chair recognized Mr. Rogers who told committee members Lifescan was the name of the program used at all detention centers and that the actual criminal fingerprint record was being electronically sent to the repository. Senator Neal asked if visitors were also being fingerprinted and Mr. Rogers responded only the criminals that had been arrested. Senator Neal asked if the program was statewide and Mr. Rogers said it was. Senator Neal questioned the need for an increase in bandwidth and Mr. Rogers explained the bandwidth would increase from 56K and 96K lines to T1 and T3 lines. Senator Neal asked which lines the Federal Bureau of Investigation (FBI) used and Mr. Rogers replied T3 or other high-speed lines.

The Chair told committee members the following issues would have to be addressed in their motion:

• To provide a letter of intent to the department to continue the language in the Appropriations Act to allow the director to transfer authority among budget accounts as needed to support payments. The department would have to report to the Interim Finance Committee (IFC) to verify that funds were being transferred between like-funded accounts;

• To accept budget modification 99;

• To accept the technical adjustments; and

• To provide a letter of intent to the department specifying the segregation of telephone line/circuit costs in a new budget category for tracking purposes.

Ms. King explained to committee members she would present the following two budgets together because they both had similar issues.

Previously, Ms. King said, the Division of Emergency Management had two budget accounts. Budget Account 3601 was 100 percent federally funded and Budget Account 3659 that required General Fund cash match.

She explained the federal requirements on emergency management had changed and all grants now required federal cash match. Therefore, the department requested, and The Executive Budget recommended, that the two budget accounts be merged. The merge would ease record-keeping and accounting by the division and allow them to better utilize staff. In addition to the combination of the two accounts, The Executive Budget provided additional funding in Budget Account 3659 to reflect the requirement of additional General Fund cash match. She explained the cash match requirement was funded effective
July 1, 1999 while the actual cash match requirement did not go into effect until October 1, 1999. That scenario resulted in a savings of General Fund match dollars in the amount of $3,620 in FY 2000 in Budget Account 3659 and $46,939 in Budget Account 3601. She said The Executive Budget recommendations had been adjusted to reflect those changes in cash match requirements.

The Chair recognized Senator O’Donnell who asked if the department had seen the recommendations staff had made and Ms. King said they had.
Senator O’Donnell asked the department if it was comfortable with the adjustments that had been made. The Chair recognized Frank Siracusa, Chief, Division of Emergency Management, Department of Motor Vehicles and Public Safety who said the department was quite comfortable with the numbers as they existed.

The Chair said the issue regarding this budget was basically because the federal grant changed. The cash match was not needed until October 1, 1999, that resulted in a cost shifting savings. She said there would be two motions for the subcommittee to consider:

• Did the subcommittee agree with the recommendation of The Executive Budget to fund the state cash match now required; and

• Did the subcommittee agree with merging this account with the other Emergency Management account.

Ms. King explained Budget Account 3673 represented the new budget account for emergency management. Through a technical adjustment issue one position in the old budget account was funded partially by 100 percent federal funds and one position that was funded by the grant that now required a grant match. As a result, half of that position was qualified as .51 in the base and the other half of the position was funded as .51 in the enhancement unit that required the additional cash match. That scenario created a 1.02 position which, she told committee members, had been corrected in the new Budget Account 3673. Ms. King explained she had combined the two .51 positions and created 1 position that resulted in savings of approximately $5,000 in each year of the biennium. She said longevity was also adjusted to eliminate longevity for a person no longer working for the division.

Ms. King said there had also been changes in calculations for postage, printing, publications, and insurance. The travel line item had been adjusted to actual. She said all of the adjustments made to the E-900 decision units in the old budget accounts also occurred in the new budget account.

Ms. King told committee members there were three issues regarding this budget account that were not included in The Executive Budget. First, a Radiological Hazard Mitigation Officer position that was filled when The Executive Budget was completed had since been vacated. The position was funded at a grade 36, step 15. Because of the specialized nature of the position, it had been the division’s policy to underfill the position and train the incumbent. She said if the subcommittee desired to reduce the funding for the position back to a step 1, there would be a savings of General Fund appropriations of $2,318 in FY 2000 and $2,564 in FY 2001.

The second issue regarded the importance of the Ham Radio Operator during an emergency. The division had a half-time Communication Systems Specialist position that was to coordinate the Ham Radio Operators. During base budget review, however, the half-time position was eliminated because it had been vacant for a long period of time. She explained the position had been held vacant due to an investigation that was being conducted into the activities of the previous incumbent. The division had indicated a willingness to eliminate a clerical position to provide funding for the half-time Communications Systems Specialist position. While The Executive Budget did not recommend that move, elimination of the full time clerical position and funding the half-time Communication Systems Specialist would save approximately $4,637 in
FY 2000 and $5,128 in FY 2001.

Ms. King said the third issue that had been discussed throughout budget hearings was the transfer of two accounting positions from the Division of Emergency Management (DEM) to the Administrative Services Division (ASD) to form a centralized grant accounting unit. ASD had since eliminated the grant accounting unit but retained the accounting positions. The accounting functions previously performed by those positions were currently being performed by the program staff. In response to questions from staff and committee members, ASD indicated the following:

Ms. King said the DEM had indicated assumption of the financial accounting duties previously completed by ASD would have the following impact:

Ms. King said DEM would not be able to fund both accounting positions within existing resources. However, the Accounting Technician III position could be funded with grant limitations.

The Chair told committee members the motion would need to entail the following:

• Technical adjustments to Decision Unit E-805 to merge two
  .51 positions to create one full-time position;

• Make technical adjustments to Decision Units E-901 and E-905;

• Reduce the funding for the Radiological Hazard Mitigation Officer’s position to grade 36, step 1;

• Fund the half-time Communication Systems Specialist position and eliminate the full-time clerical position effective September 30, 1999; and

• One accounting position would remain with ASD and the second accounting position would be transferred back to the DEM.

Ms. King explained The Executive Budget recommended funding this account with the grant match effective July 1999 when the actual grant match was not required until October 1, 1999. Therefore, the General Fund appropriation was reduced by $46,939. The longevity line item had been adjusted to reflect current staffing. She told committee members The Executive Budget recommended this account be merged with Budget Account 3659.

The Chair told committee members the motion would include the following:

• To fund the state cash match now required and recommended in
  The Executive Budget; and

• To merge this account with Budget Account 3659.

Ms. King explained staff was recommending this budget account be closed at the "Governor Recommends" level. She recalled the subcommittee had heard earlier testimony that the department was evaluating the ongoing need for the lieutenant position. The traditional Nevada Highway Patrol (NHP) staffing was one sergeant for nine troopers and one lieutenant for six sergeants. By memorandum dated March 18, 1999, the department indicated it would not be able to tell the subcommittee whether or not the lieutenant position was needed until after the Governor resumed a "normal" work schedule after the legislative session.

She said the subcommittee could continue exactly as the Governor had recommended, it could eliminate the lieutenant’s position, or place the funding for the lieutenant’s position in reserve and have the department report to the Interim Finance Committee (IFC) after it had completed its need analysis.

The Chair recognized Mrs. Chowning who felt the most efficient method would be to leave the position vacant and place the funding in reserve and have the department report to IFC when the analysis had been completed.

The Chair told committee members there had been testimony the position was not needed. The staffing patterns did not justify the position and had not for some time. She felt it made more sense to close this budget account as the Governor had recommended without the Lieutenant’s position.

Ms. King explained this budget account had been in existence for a number of years. This was the first time, however, the account had been included in
The Executive Budget. The grant account primarily represented the activities of the Motor Carrier Safety Assistance Program (MCSAP) and was 100 percent federally funded. Match dollars were required through trooper salaries in the regular Highway Patrol budget account.

The Executive Budget recommended $80,000 in highway fund start-up money for this account and $81,000 in federal fund cash balance forward. Ms. King said staff recommended eliminating the federal fund cash balance forward because the department should not carry federal cash forward from
year-to-year. Federal cash should only be drawn down to meet current projected expenditures. Additionally, staff recommended the elimination of highway fund start-up costs as the account had not historically requested that funding. She explained there were a number of 100 percent federally funded budget accounts that did not have start-up funds. Those agencies included the Department of Education, Training and Rehabilitation and the Division of Child and Family Services. Finally, the grant award was adjusted to the actual
FY 1999 award level and the Public Safety Info Technology charges were changed in this account to recommend the revised levels.

The Chair told committee members the issue before them was whether or not they wanted to eliminate the Highway Fund appropriation and grant funding and reduce other grant costs to balance the increased computer costs. She said the start-up cost was the issue.

Ms. King explained this account was used to receive and record the forfeitures of assets obtained through criminal activities. The Executive Budget recommended authorization to pass funds through to locals, and provide the grant match and replacement computers for the Nevada Division of Investigations (NDI). All other funding in the account was placed in reserve and when NDI or the Highway Patrol developed a spending plan for using those funds, that plan was presented to the Interim Finance Committee (IFC) for approval. She told committee members the budget was modified to reflect the changes that occurred in budget modification number 66 (corrected a General Ledger (GL) entry) and to reflect the amounts already closed in the Byrne grant match account.

The Chair recognized Senator O’Donnell who asked why a $60,000 journal entry would be made to correct the GL. Ms. King explained The Executive Budget recommended the money go into the GL as a negative in category 14, GL 9178, and as a positive in GL 9100 which meant, in effect, The Executive Budget cancelled out all funding for that activity. Budget modification number 66, requested by The Executive Budget, took the negative portion of that entry to show the reduction in the reserve. The correction to the GL gave the department the authority to spend the money whereas before the entry actually cancelled itself out.

The Chair said the issue before committee members was whether or not they wanted to close the budget with the adjustments outlined in the budget closing document to the amounts recommended by the Governor.

Ms. King explained The Executive Budget recommended the Fire Marshal account become a self-funded account through licenses and fees charged to the fire protection industry and through plan review check fees. Increases in the projected revenue in the Fire Marshal budget account were generated by workload increases rather than fee increases. Fees for the account had not been changed since 1989.

Staff had recommended several technical adjustments. Each technical adjustment discussed in the budget closing document required an adjustment to the reserve, and then the balance forward in the subsequent year. Decision Unit E-175 was reduced to reflect training for five inspectors. Decision Unit
E-197 provided funding for travel costs that were previously grant funded. The adjustment was to reduce the amount of travel costs being recommended for funding down to the actual grant costs that were incurred in FY 1998. The travel for the board in category 14 was reduced based upon the agency response that indicated that amount had been duplicated in the base budget. Decision Unit E-375 adjusted the calculation of per diem for additional travel for inspectors. The Executive Budget had recommended the per diem at full rates for Monday through Friday. The adjustment reduced the breakfast and the dinner rate on Friday that saved over $6,000 in per diem and $4,500 in motor pool rent costs. Decision Unit E-375 also eliminated insurance that had been funded in the base budget. Those adjustments impacted both the reserve and the balance forward. Hardware and software in Decision Unit E-710 had been revised to reflect the updated costs per the March 9, 1999 memorandum from the Purchasing Division. Finally, Decision Unit E-805 reflected the cost allocation from Public Safety Information Services.

Ms. King said the subcommittee should note that even with the technical adjustments described above, the budget was not balanced and could not be closed. Adding the cost allocations recommended for Public Safety Information Services, Department of Information Technology (DoIT) and a statewide cost allocation would generate a deficit in the reserve in excess of $1,000 in
FY 2000 and $6,000 in FY 2001. The cost allocation for the Public Safety Information Services account was shown in Decision Unit E-805. The costs for the DoIT and statewide cost allocation had not been finalized but were expected to be in excess of $5,000.

Ms. King said the subcommittee may wish to ask the Budget Division for their recommendations regarding this account. She said there appeared to be four options for this account:

• Fees could be raised. A 10 percent increase in fees would generate approximately $65,000 in FY 2000 and $134,114 in FY 2001. The lower level of fees in FY 2000 was due to the 6-month time frame to go through the administrative regulation hearing process.

• The second option was to eliminate all enhancement modules except for
  M-100 (inflation), M-300 (fringe benefit changes), and E-900 and E-910 (the transfer of the Fire Services Board and Fire Services Standards and Training Board between the two accounts). That option would provide a balanced budget with the allocated cost. If revenues came in higher than projected, the Fire Marshal could approach the Interim Finance Committee (IFC) and restore the unfunded decision units. This option would allow for portions of Decision Units E-175 (funding of additional training) or E-197 (funding of additional travel), or E-375 (funding for additional inspection travel) to be funded.

• The third option would be to add the General Fund dollars necessary to balance the budget.

• The fourth option would be some combination of the previous three.

The Chair asked for response from Carol English, Budget Analyst, Budget Division, Department of Administration, regarding the issue of fees. Ms. English told committee members the issue of fee increase had been discussed with the Governor and it was her understanding there had been no response. Until that response was received, the division could not advise the subcommittee regarding fees. The Chair said the industry did not seem to be opposed to a fee increase and that increase was absolutely necessary in view of the fiscal impacts identified in the upcoming Clark Commission reports.

The Chair recognized Mrs. Chowning who felt the increase of fees would fall within the recommendations and/or decision from the Governor. The Office of the State Fire Marshal had been continually asked to do more with less. She said 10-years was a long enough time not to have fees increased and she had heard not one objection to a fee increase from the industry. Mrs. Chowning felt it was a far better option to raise fees than use General Fund dollars.

The Chair recognized Mr. Marvel who asked the average inspection fee charge. Marvin Carr, State Fire Marshal, responded and said the average hazardous material permitting fee in Budget Account 3834 was $120 per year. The major portion of the funding generated for the Office of the State Fire Marshal, Budget Account 3816, came from fire life safety plan review fees. He pointed out those fees had not been increased since 1983. The fire life safety plan review fees were based on a graduated scale of the total dollar value of the building being reviewed. Mr. Marvel asked what the fiscal impact would be on local business and Chief Carr said a 10 percent increase would be sufficient to balance the budget.

Ms. King explained Budget Account 3834 provided training to the standards established by the Governor-appointed Fire Services Standards and Training Commission. The Executive Budget recommended funding in this account with a General Fund appropriation of $131,803 in FY 2001. Previously, the account was funded by a combination of fees from the Beatty Dump site and hazardous materials storage certificates. The level of activities for the Beatty Dump site had decreased in recent years and the reserve that had been developed had been eliminated.

Ms. King said the subcommittee should note staff had made two technical adjustments as follows:

• Due to the questionable receipt of the Beatty Dump site fees,
  The Executive Budget recommended placing all receipts in a separate category. $180,000 had been budgeted for dump site fee receipts and $180,000 had been budgeted in reserve. Staff recommended combining the reserves since they both originate from the same source of revenue. The subcommittee should note that if the reserves were not combined, this budget account would have a deficit reserve in the general reserve account at the end of FY 2001.

• Decision Unit E-805 had been added to reflect the cost allocation from Public Safety Information Systems.

Ms. King told committee members Decision Unit E-197 in The Executive Budget recommended funding the federal SARA Title III grant activities ($25,000 in
100 percent federally funded activities) as well as some board member travel that had been removed from the base budget. Decision Unit E-710 in
The Executive Budget recommended office furniture, computer replacement and replacement of two vehicles. Decision Units E-900 and E-910 in
The Executive Budget recommended the transfer of the Fire Services Board to this account and the Fire Services Standards Board to the Fire Marshal’s general account.

Ms. King said the department had provided a proposal to authorize four additional inspector positions to comply with the recommendations of the Clark Commission on Public Safety. She said the department had provided information that indicated the positions would be self-supporting and would contribute to the general support of the office. Ms. King told committee members the department had provided a phased-in schedule that would allow the hiring of the inspectors (Deputy State Fire Marshal I) on a phased-in basis. Although the phase-in would require some start-up cash, the department should be able to fund the initial costs from beginning reserve. If two positions were hired, they would be able to generate sufficient funds to cover the start-up of the next two positions. Ms. King said the subcommittee may wish to consider adding the two positions to be funded through the fees generated. If the positions generated a sufficient level of fees, the department could approach the Interim Finance Committee (IFC) to add additional positions. If the subcommittee approved the additional positions, they may want to add a letter of intent to report semi-annually to IFC. The letter of intent would specify the subcommittee’s intent that the positions be self-supporting. She said if the positions could not generate sufficient fee levels to pay for their costs, those positions should be eliminated at such time it was determined they could not support their own cost.

The Chair told committee closing of this budget would involve consideration of the following issues:

• The technical amendments described above;

• The three options for Decision Units E-197, E-710, E-900, and E-910 to close the budget as the Governor had recommended; and

• To allow for the two Inspector positions to be funded through fees generated. If those positions did not generate the self-supporting fees within 1-year, the program would be eliminated. If sufficient funds were generated to support the first two positions, the department could approach IFC to add an additional two positions.

The Chair recognized Senator Neal who said it was his understanding the University System was building a huge fire-training center and asked what the relationship would be with the Office of the State Fire Marshal. Chief Carr said the Office of the State Fire Marshal had recently completed fire inspections on the Carlin facility, which was specifically an oil, fire, and gas training facility. He explained there was a fee charged for classes at the facility. It was the intent of the Office of the State Fire Marshal to have volunteers provide training at the facility and to use the facility as often as possible. Senator Neal wondered if training on hazardous materials would also be handled at that facility and Chief Carr said yes, to the extent hazardous materials related to flammable liquids.

The Chair recognized Senator Jacobsen who asked how the Carson City facility, located by the airport, fit into the training pattern. While the Office of the State Fire Marshal tested the city’s firefighter I and firefighter II programs at that facility, there was no other involvement.

The Chair recognized Mr. Marvel who asked if the Office of the State Fire Marshal felt confident it could support the two inspector positions and Chief Carr responded in the affirmative. The Chief felt a phase-in program for addition of those positions was appropriate. He told committee members his office had performed a test case in Winnemucca with its existing inspector position that had resulted in a better than break-even situation.

Ms. King told committee members this budget account involved work with local governments to protect the citizens of the state from negative effects of hazardous materials use, manufacture, storage, or transportation, while supporting the state’s goal of encouraging industry development and growth. She said the agency worked with local emergency planning commissions to effectively plan, train, and equip public safety officials and responders, to ensure public safety in view of the ever-increasing presence of hazardous materials in our society.

The Executive Budget recommended additional travel in Decision Units
M-200 and M-201 to allow staff and commission members to work with the newly activated Local Emergency Planning Commissions (LEPCs) in Eureka, Churchill, and Lander Counties. She told committee members Decision
Unit E-710 recommended replacement of a personal computer, and Decision Unit E-800 allocated the cost of the Public Safety Information Technology budget. The amounts shown in Decision Unit E-800 would be adjusted to reflect the changes recommended as a result of the review of the Public Safety Information Technology budget amendments.

Ms. King said staff recommended closing the budget as the Governor had recommended with the above stated adjustments.

SENATOR JACOBSEN SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY.

* * * * * * * * * *

There being no further business, the meeting was adjourned at
9:20 a.m.

RESPECTFULLY SUBMITTED:

Debbie Zuspan,

Committee Secretary

APPROVED BY:

Assemblywoman Chris Giunchigliani, Chairwoman

DATE:

APPROVED BY:

Senator Lawrence Jacobsen, Chairman

DATE: