The Committee on Ways and Means was called to order at 3:30 PM, on Tuesday, April 20, 1999. Chairman Morse Arberry, Jr. presided in Room 3137 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mr. Morse Arberry Jr., Chairman

Mrs. Jan Evans, Vice Chair

Mr. Bob Beers

Mrs. Barbara Cegavske

Mrs. Vonne Chowning

Mrs. Marcia de Braga

Ms. Chris Giunchigliani

Mr. David Goldwater

Mr. Lynn Hettrick

Mr. John Marvel

Mr. David Parks

COMMITTEE MEMBERS ABSENT:

Mr. Joseph Dini, Jr.

Mr. Richard Perkins

Mr. Robert Price

STAFF MEMBERS PRESENT:

Testifying in support of A.B. 103, Assemblyman John Marvel, Assembly District 34 representative, explained the intent of the bill was to correct the problems that had resulted from the consolidation of the former Department of Agriculture and the former Department of Minerals under the auspices of the Department of Business and Industry (B&I).

Because of the importance of the two industries to the state of Nevada,
Mr. Marvel felt both the Division of Agriculture and the Division of Minerals should have either departmental or commission status. He contended the transition of those two entities from B&I would improve communication between the Governor and the industry heads, as well as improve the leverage agriculture and mineral officials would have to articulate their needs to federal agencies in Washington D.C.

However, Mr. Marvel noted there was a fiscal impact to the bill. He thought the re-establishment of the Department of Agriculture would save the Division of Agriculture and the State Predatory Animal and Rodent Committee $52,000 a year, while placing the Division of Minerals under the Commission on Mineral Resources would save $11,000 per year.

Additionally, Mr. Marvel stated the re-establishment of the Department of Agriculture would impact the Department of Business and Industry’s budget. However, he related that Dan Tom, Director of B&I, had agreed to the reduction of B&I’s budget as a result of the passage of the bill.

Next, Assemblywoman Marcia de Braga, Assembly District 35 representative, stated A.B. 103 intended to separate out the Division of Agriculture from the Department of Business and Industry and made the division a stand-alone department. She related the new Department of Agriculture would house various related agencies including, the Junior Livestock Show, the State Board of Sheep Commissioners, the Nevada Beef Council, and the State Predatory Animal and Rodent Committee. Also, she explained the bill would place the Division of Minerals under the Commission on Mineral Resources and gave it rate setting authority.

Although Mrs. de Braga acknowledged the fact that some individuals had been concerned by the departmentalization of the areas of government that had recently been consolidated, she believed that an exception needed to be made in the case of the Division of Agriculture. She emphasized that A.B. 103 would result in significant monetary savings.

Mrs. de Braga then reiterated that the agencies impacted by the bill were all related to one another and could share resources. Furthermore, she argued that they could operate much more efficiently separated from B&I. She remarked those agencies served the public well by providing services without being hampered by the myriad of forms and reports required by B&I.

For example, she used her personal experience as State Secretary for the High School Rodeo Association to illustrate how various related agencies of the Division of Agriculture were inundated with burdensome and unnecessary forms and statements from the Department of Business and Industry.

Mrs. de Braga felt the transition of the two entities would save the state money in terms of efficiency and would save money to the new department in terms of reduced cost allocations. She noted that while the Department of Business and Industry lost money, the transition supported the argument that the other agencies under B&I needed to pay their fair share in terms of cost allocation and should not be charged a percentage of the total.

She reiterated the new department could better understand the agencies placed under its control with far less red tape and bureaucracy than the Department of Business and Industry. Moreover, the new Department of Agriculture would be large enough to function effectively as a department in their own right.

Mrs. de Braga noted the bill had the acceptance and support of the Governor.

Mr. Marvel then added that the Nevada Farm Bureau had submitted a statement (Exhibit C) on the bill. Also, he noted the Division of Minerals did not operate with the use of General Fund monies, but with resources stemming from the mining industry.

Next, Mr. Marvel introduced James E. Connelley, Chairman of the Nevada Board of Agriculture who also spoke in support of A.B. 103. Reading from a prepared statement (Exhibit D), Mr. Connelley testified,

Mr. Connelley added that 4 years ago the board had begun the search for a new administrator. Particularly, the board looked for an individual who could lead the department in the new areas of responsibilities they predicted for the future. Those new responsibilities were created by the burgeoning interface between urban and agricultural impacts in the state of Nevada, such as pests and pesticides; bees and fire ants; petroleum, and organic foods.

Thus, in order to streamline the department and to make it more accountable, Mr. Connelley stated the board had hired an Administrative Services Officer and had undergone two legislative audits. He felt the board was thoroughly addressing all of the concerns brought to the board’s attention.

For instance, in order to make the department more focused, Mr. Connelley related the board developed a comprehensive, dynamic, strategic plan with long range goals and objectives that were re-evaluated at every board meeting. Furthermore, tracking systems were developed for livestock inspection and theft, which accounted for nearly 400,000 inspections per year. Scheduling and tracking procedures for Weights and Measures were also developed. He mentioned Weights and Measures had certified 24,000 units statewide and that certification activity was growing by a rate of 10 to 11 percent per year.

Mr. Connelley noted the bill had the support of the Farm Bureau and the Nevada Cattleman’s Association. He remarked an organizational chart had been distributed for the committee’s perusal.

Mr. Marvel interjected to comment that A.B. 103 had been passed unanimously by the Assembly Committee on Natural Resources.

Next, Alan R. Coyner, Administrator for the Division of Minerals, distributed a handout (Exhibit E) which supported his testimony. He stated the division supported the passage of A.B. 103 as it had been amended.

Mr. Coyner commented the effects of the bill were four-fold. First, he explained that the Division of Minerals would be withdrawn from the Department of Business and Industry, to become a division of the Commission of Mineral Resources. No new programs or staff would be created by the change and reporting responsibility would be given to the commission, which had direct reporting responsibility to the Governor. He mentioned the annual cost allocation to B&I of $11,794 would be re-allocated to the existing programs within the division.

Second, Mr. Coyner explained the bill called for the administrator of the division to be appointed by the Commission on Mineral Resources. The division would retain its position on the state Environmental Commission and five of the six administrative fees collected by the division would be changed from a statutory status to a regulatory status, which would be set by the commission. He explained that the sixth administrative fee on geo-thermal was currently set through regulation by the commission.

Mr. Coyner stated the change would allow for more flexibility in the timing of the adjustments and provided for industry input through workshops and hearings. The fee setting process was balanced both by the make-up of the commission, which consisted of six industry representatives and the appeals process, which was implemented by the Legislative Commission.

He pointed out that a table had been attached to Exhibit E, which described the five fees affected by A.B. 103 including proposed caps that were provided for in accompanying legislation, A.B. 450, which was currently being heard by the Nevada Senate.

Mr. Coyner then indicated the commission took a position of support in November 1998 and pledged to adjust those fees as necessary to balance the FY 2000 and FY2001 budgets proposed by the division. Again calling attention to the table, (see Exhibit E) he pointed out that each of the administrative fees were described by their amounts, by their 1998 revenues, and by the proposed cap under A.B. 450.

Mr. Marvel asked if the mining industry was supportive of the caps proposed by A.B. 450. Mr. Coyner deferred response to Russell Fields, President of the Nevada Mining Association. Mr. Fields answered the association was in support of A.B. 103 specifically with regard to the administratively set fees by the Commission on Mineral Resources. He noted the Assembly Committee on Natural Resources had heard testimony regarding A.B. 450, where the bill had been amended to establish caps for the various fees that the division currently collected. He indicated that the Commission on Mineral Resources would administratively set those fees. Mr. Fields then emphasized the Nevada Mining Association supported those caps and supported the commission’s authority to hold hearings and through the regulatory process, establish fees that would fund the agency.

Ms. Guinchigliani then commented that the Governor had indicated that if the State Board of Agriculture supported the bill, the measure would not be threatened with an Executive veto. Thus, the committee had closed budgets in the Assembly Ways and Means Subcommittee on General Government anticipating a fee adjustment so that the bill could be properly funded. She remarked agricultural issues were pervasive and no longer affected only the cattle industry.

Next, Paul Iverson, Administrator for the Division of Agriculture, reiterated the infrastructure for the departmentalization of the Division of Agriculture was in place. Fortunately, the division had the personnel and guidance from the Legislative Counsel Bureau (LCB) audit team, to effectively re-organize the division. Furthermore, he mentioned the division’s accounting staff worked closely with LCB and the Budget Division to implement better administrative processes and internal controls to run the division as a stand-alone agency. By the end of the forthcoming biennium, he was certain the new Department of Agriculture would prove itself capable of producing accurate and timely performance indicators.

Mr. Iverson remarked that the most important issues the new department would have to address were the problems associated with cost allocations and funding policies.

Mr. Hettrick then explained that the bill had been addressed in the Assembly Committee on Natural Resources, where most of the factors affecting the departmentalization of the Division of Agriculture were delved into thoroughly. He felt that it was important to emphasize the fact that A.B. 103 affected fire ants and Africanized honeybees, in addition to other agricultural issues. He related that those issues were major concerns for southern Nevada’s tourism industry.

Moreover, Mr. Hettrick felt that a straight line of communication with the Governor would assist the agency in effectively managing situations that adversely impacted the state. In addition to that, he observed that the funding for the new department would come from the allocation currently given to both the Division of Minerals and the Division of Agriculture. The cost allocation funding which had been given to B&I was theoretically supposed to have been used for services from B&I to the two divisions. Since those services were not being provided to the two divisions as had been intended, he felt the cost allocation to B&I was a financial "wash."

Mr. Hettrick conceded A.B. 103 impacted financially, however he felt those costs were worth absorbing in order to realize the benefits departmentalization of the Division of Agriculture would offer. Therefore, he concluded by stating his unequivocal support for the bill.

Next, Dan Tom, Director for the Department of Business and Industry, testified that he could neither oppose nor firmly support A.B. 103. He related the Governor maintained the departmentalization of the Division of Agriculture had some merit. He remarked that out of the agencies’ under the umbrella of the Department of Business and Industry, the Division of Agriculture and the Division of Minerals were managed extremely well and he thought they would continue to operate effectively as stand-alone entities.

From a fiscal standpoint, Mr. Tom noted there was a $64,000 impact upon B&I’s administrative budget. Nevertheless, he believed the department could deal with the loss of $64,000 by finding the efficiencies to cover the loss. Furthermore, Mr. Tom held that the bill should be evaluated solely upon its merits, rather than its monetary impacts upon B&I.

Mrs. Chowning noted her support for A.B. 103. However she wondered where the State Predatory Animal and Rodent Committee would be placed after the departmentalization of the division.

In reply, Stephanie Licht, representing the Nevada Woolgrower’s Association and the Nevada State Board of Sheep Commissioners, answered that the State Predatory Animal and Rodent Committee would exist within the new Department of Agriculture. She then reiterated that the state committee also supported A.B. 103.

Yet, Ms. Chowning observed that the bill appeared to transfer only the Division of Agriculture and the Division of Minerals out from under the Department of Business and Industry. Other agencies like the State Predatory Animal and Rodent Committee appeared to remain within B&I.

Mrs. de Braga commented that some of the agriculture related committee’s and commissions operating within B&I were not actually classified as a state agency even though they were listed as such. Therefore they did not need to be listed legally in order for the transfer to become effective. She then explained that there had been an agreement between all of the listed agencies, commissions, and committee’s expressing a desire to be transferred into the new Department of Agriculture.

For example, she had asked fiscal staff about the legal factors involved in transferring the High School Rodeo Association from B&I to the new department. She had been told that because the association was not actually a state agency, it did not need to be formally listed in the bill in order for the transfer to occur

Mr. Marvel clarified that Mrs. Chowning had been reading the first print of the bill, not the re-printed version.

As no other testimony for or against A.B. 103 was presented to the committee, Chairman Arberry declared the hearing on the bill closed and moved to address the following bill.

Bernie Anderson, Assembly District 31 in the City of Sparks, testified in support of A.B. 596. He introduced Tom Burrous, the Redevelopment Project Coordinator for the City of Sparks, and Wayne Seidel, Manager for Engineering Services for the City of Sparks. In addition, Mr. Anderson presented David Hill representing the City of Sparks.

Mr. Anderson stated the City of Sparks had been fortunate enough to receive a small grant, during the previous legislative session, to help with the re-development and renovation of the Sparks Heritage Museum which was a combination of two buildings that were brought together in 1985.

Initially, he explained the museum was housed in one building, but recently another building had been required. Subsequently the new addition to the museum was a building that had been designed by a famous architect who had designed many other registered historical buildings in Nevada. Mr. Anderson noted that through a legislative grant provided for in the Sixty-ninth Legislative Session and through monies raised by the Sparks Heritage Museum and the City of Sparks, the museum was able to install a heating and air conditioning system to stabilize the fragile environment of the museum materials.

Mr. Anderson then indicated the $65,000 grant proposed by A.B. 596 would be used for maintenance and historical renovation of the initial building.

Mr. Seidel next testified the bill would be used for seismic retrofitting improvements that would reinforce the initial building’s roof. Also, the grant would be used to improve the building’s façade.

Chairman Arberry wondered if the City of Sparks had been able to garner federal matching dollars. Mr. Seidel replied negatively and stated the museum would receive a $30,000 grant from the Heritage Fund, a non-profit organization, for façade improvements, which would cost $50,000 to complete. The seismic improvements, however, would cost an additional $50,000 to complete.

Mr. Marvel wondered if the City of Sparks had made an application to the Commission on Cultural Resources (CCR) for funds to support the renovation. Mr. Burrous replied the Heritage Museum had received two grants from CCR for other renovation projects to the museum, but that those grants had been used to renovate the de Longchamps building. He mentioned that the renovation of the de Longchamps building was part of phase II of the museum’s renovation project. Phase III of that project also targeted the de Longchamps building. Mr. Burrous related the cost of Phase III, which amounted to $40,000, was supported by grants already received from CCR.

Mr. Burrous then explained the museum’s initial quarters had no historical value and thus were not eligible for any other funding from CCR. A.B. 596 would provide the funds needed to retrofit the initial building.

Mr. Marvel did not understand why the building was ineligible to receive additional CCR dollars. Mr. Burrous repeated that the de Longchamps building was the only building within the City of Sparks that had a place on the National Register. However, the museum’s initial building had been modified and renovated so frequently that there was no historical integrity to preserve and it therefore was not eligible to receive any restorative funds from CCR.

Mr. Anderson added that the initial building was once a drug store that had been expanded by Senior Services to provide a Meals on Wheels program and a Senior Center. After several additional modifications, the building was handed over to the Sparks Heritage Foundation for the purpose of establishing the museum. Until Washoe County relinquished the de Longchamps building over to the Sparks Heritage Museum, the museum was housed in the smaller building with no historical value. He noted that since the de Longchamps building was on the National Register as an historic landmark, that building was entitled to receive grant money.

Mr. Anderson stated that the grant requested in A.B. 596 would renovate the smaller building’s heating and air conditioning unit as well as improve the structural quality of the building to preserve the historical artifacts housed there.

As no additional testimony concerning A.B. 596 was presented, Chairman Arberry closed discussion on the bill and addressed the next piece of legislation.

Dean Heller, Secretary of State for the state of Nevada, testified in support of A.B. 72 and distributed a handout that provided answers to some of the concerns targeting the legislation (Exhibit F).

He explained the legislation had been drafted as a result of certain litigation in previous years. He stated that investors and unsuspecting consumers had lost tens of millions of dollars due to certain aspects of the unregulated mortgage industry. He reminded subcommittee members that Assemblyman Goldwater had been given the responsibility to formulate a subcommittee that would investigate the mortgage industry to determine what action should be taken.

Mr. Heller reported that two pieces of legislation were then drafted based on the recommendations of Mr. Goldwater’s subcommittee; Assembly Bill 64 and
A.B. 72 were both drafted as a result of the subcommittee’s investigation. Mr. Heller thanked the legislators on that subcommittee for their hard work and effort. Furthermore he emphasized that both bills A.B. 64 and A.B. 72 were both crucial pieces of legislation and he urged the committee to adopt the bills in order to reduce the risks associated with an unregulated mortgage industry.

In regard to A.B. 64, Mr. Heller explained the bill’s intent was to regulate the mortgage industry itself. A.B. 72 on the other hand, regulated investments associated with the industry. It was the responsibility of the Securities Division to regulate, license and investigate securities fraud. Specifically, A.B. 72 took an exemption for real estate transactions and liens out of the current securities statutes.

Currently, he remarked the mortgage securities industry was exempt from oversight concerning licensing and registration. He concurred with the recommendation of the subcommittee, which was to implement regulations that would both protect the industry and the consumer at the same time.

Mr. Heller stressed that the purpose of securities law was to provide for investment protection. Statutes regulating securities required full disclosure of all negative material that might be of interest to potential investors.

Next, Mr. Heller addressed the issue of the bill’s fiscal impacts. He pointed out that during the first year of the biennium, the new regulation proposed by

A.B. 72 would cost $173,000. In the second year of the biennium, the bill proposed an allocation of $158,000 to support the regulation.

Mr. Heller stated that similar to A.B. 64, the revenue stream that is collected through this process of regulation would offset the projected costs of A.B. 72. Although he admitted that he could not approximate the expected revenue stream emanating from the bill, he anticipated that $150,000 to $200,000 in revenue could be collected each year of the biennium.

Chairman Arberry then asked if the Securities Division had office space in Reno, as the fiscal note to the bill indicated that the person who would oversee the new regulation was to be located in Reno. He thought that individual could share office space in the division’s Carson City office.

In reply, Mr. Heller explained the division already had office space in Reno and in Las Vegas. The individual assigned to the new regulation proposed by
A.B. 72 was to be located in an additional space adjacent to the Securities Division’s current office space. He repeated that because the current Securities Division’s office was comprised of three rooms, all of which were being used by investigators, Mr. Heller stated that an additional room was scheduled to be added on to the office to house the new investigator.

If the bill were passed, Chairman Arberry wondered how the new investigators would be trained. Mr. Heller responded that the new investigators would most likely already have training related to the regulation of mortgage securities. He mentioned that most of the division’s investigators had come from states, which currently regulated the mortgage securities industry. However, he noted that some training costs were associated with the bill, as some members of the office would require additional training.

Mr. Heller then emphasized that the responsibilities of the new investigators were similar to the responsibilities of other financial institutions.

Speaking against the bills, Russell Best, representing Home Financial Mortgage Company, testified that the mortgage industry had been harassed by the proposals made by A.B. 64 and A.B. 72.

He commented that the problem was derived from the fact that outside financial institutions who conducted business in Nevada were exempt from Nevada’s securities law and thus operated unregulated. He felt that the citizens of the state were then endangered because the potential risks posed by those outside financial institutions were not being addressed.

He noted that outside corporations, which included realtors and securities institutions, conducted business free from the reach of the law in the state of Nevada. If financial institutions were going to be regulated, Mr. Best contended that regulations should be extended equally to all financial institutions including those that originated from other states. He held that the bills at question would have a negligible impact upon the state because they were not being applied fairly to all institutions and because they did not address the problem in reality.

Mr. Goldwater then interjected to clarify the issue at hand, as he desired to ensure that the committee understood clearly the proposals being made by
A.B. 72.

Mr. Goldwater stated that A.B. 64 specifically addressed the financial institution or mortgage company itself. He said the bill differentiated between an exempt company and a non-exempt company. Consequently the bill placed new regulations upon non-exempt companies which were mortgage investment businesses.

A.B. 72 on the other hand, proposed to regulate the transaction, which was the part of the process securities laws generally, regulated. Mr. Goldwater emphasized the fact that the two bills differentiated in that they focussed on alternate components to the mortgage securities industry.

Mr. Goldwater concluded his remarks by stating that he believed both bills were extremely important consumer protection measures.

Chairman Arberry then closed discussion on A.B. 72 and offered to hear testimony on the next bill.

Stephanie Licht, representing Mrs. de Braga, who could not be present at the hearing, introduced A.B. 659 to the committee. She noted that Mrs. de Braga had been working with AmeriCorps of Fallon in previous sessions to garner funding in support of the AmeriCorps programs.

She maintained that AmeriCorps was a very worthwhile program that had expanded to the statewide level. She related that the program was administered by the Nevada Commission for National and Community Service, which was created by then Governor Miller in 1994.

Ms. Licht related that A.B. 659 asked for an appropriation of $250,000 over the next biennium to pay a portion of the cost of providing the program statewide. That total amount of money would be used to leverage federal AmeriCorps money and would be used to award and manage the state’s allocation for AmeriCorps programs, which was between $500,000 and $1.2 million per year in volunteer community service programs.

Ms. Licht then called attention to line 17 of the bill and stated the money in A.B. 659 had the potential to create an 8 to 1 return on the state dollar while providing services to Nevadans.

Next, Shawn Lecker, Executive Director of the Governor’s Commission for National and Community Service, often referred to as the Nevada AmeriCorps, spoke in support of A.B. 659. She then distributed a handout (Exhibit G).

She explained the Nevada Commission for National and Community Service (NCNCS) received a minimum of $500,000 a year in federal AmeriCorps funds based on the population of the state.

Ms. Lecker stated AmeriCorps was the most recent national and community service initiate and joined the ranks of the more well known VISTA and Peace Corps programs, with which the committee was probably familiar. She indicated the Nevada Commission was charged with promoting an ethic of service statewide, by supporting broad based community volunteering collaborations and by soliciting, selecting for funding, and managing qualified community service AmeriCorps programs throughout Nevada.

Ms. Lecker then declared her support the Nevada’s AmeriCorps programs by urging the passage of A.B. 659.

She then listed the accomplishments of Nevada’s AmeriCorps programs and described the benefits provided to the communities and constituents of Nevada.

• Over 1,900 children in Clark County Schools and Boys and Girls Clubs were tutored in such areas as math, reading, and homework assistance;
• An additional 300 youth were tutored or mentored in Washoe, Lyon, and Story Counties through the Pinion Service Project;
• 67 percent of those students receiving services from AmeriCorps members actually improved in their reading and writing scores;
• 58 teen parents in Churchill County remained in high school continuing their education, hence were more likely to support their families through adequate jobs;
• 200 at-risk infants and toddlers of those under-educated parents received appropriate child care while their parents attended school;
• 1,250 students in Washoe, Lyon, Storey, and Carson Counties participated in community service projects, donating over 15,000 hours of service to their communities in one year, thereby continuing the tradition of service and volunteerism in Nevada;
• Of those students, 50 percent developed and regularly used conflict resolution strategies, resulting in the reduction of school and youth violence.

Since funding for higher education was an important issue this legislative session, Ms. Lecker indicated that it was vital to take the following benefit into consideration as committee members deliberated on supporting Nevada’s AmeriCorps.

She detailed that there were 215 AmeriCorps members with a permanent address in Nevada, who had earned an educational award or scholarship. She said the value of those awards totaled $628,000, which averaged out to $2,921 per member. She then explained that a member could receive up to $4,725 for one full-time term and the award could be used to attend college or technical school or to pay off qualified student loans. Also, she noted that a member could only receive that award twice.

Ms. Lecker next called attention to the communities, which benefited from AmeriCorps programs in Nevada. For example, she cited Clark County, which historically had a received 40 percent of its formula funding allocation. Also, Churchill County saw members serve 4 years in a row through the Turnabout AmeriCorps program, the very first operating program of the commission. She noted that the legislature had financially supported this AmeriCorps program directly during the past two legislative sessions.

Ms. Lecker insisted that for an additional $100,000 per year, as proposed by A.B. 659, the state could support a statewide AmeriCorps program.

Continuing with her description of the counties which received AmeriCorps support, Ms. Lecker reported that Lyon County, Washoe County, and Storey County received AmeriCorps services through the Pinion Service Project. Caliente, Churchill County, Storey County, and Douglas County also were served through AmeriCorps "Learn and Serve" programs as well as through mini-grants to incorporate service learning technology as a teaching methodology.

In addition to those service programs, Washoe County was scheduled as the site of AmeriCorps recently approved Nevada Conservation Corp, which would operate in conjunction with the Opportunity High School in Washoe County. The program also included Senior Citizens mentoring youth and was a collaboration of federal, state, and local environmental agencies through the Great Basin Institute at the University of Nevada, Reno (UNR).

Ms. Lecker indicated that AmeriCorps collaborated with VISTA to implement an America Reads program statewide. The America Reads program intended to serve Washoe County, Clark County, Churchill County, Moapa, Pahrump, and Lovelock. She noted that VISTA members would serve alongside AmeriCorps members in order to operate the program effectively.

Ms. Lecker reiterated that AmeriCorps was committed to serving the entire state of Nevada. She articulated that this goal would be met by developing new programs in under-served populations such as the rural areas and tribal nations, by providing technical assistance. This would result in high quality, grass-roots programs that addressed unmet local needs.

Next, Ms. Lecker addressed the cost-effectiveness of AmeriCorps. She related that for every $1 the state invested in AmeriCorps, it would receive up to $8 in federal funds. She stated this was an excellent return on the taxpayers dollar. Furthermore, AmeriCorps proved cost-effective because the funding created 70 jobs or "service assignments" a year.

She then explained that a majority of the funding was used to support the living allowances for the AmeriCorps members. She relayed that members received an average of $5 an hour for their service assignments. She noted, however, that AmeriCorps members could not lobby and that those who planned on testifying before the hearing did so at their own expense.

Next, Ms. Lecker mentioned that the living allowances provided to members were subject to federal withholding taxes, thereby recycling the money back into programs like the ones she had mentioned.

She also explicated that the programs themselves required the sub-grantee to provide support in the amount of $20,000 cash and $20,000 in in-kind donations such as office space and supplies. She emphasized that AmeriCorps programs were not giveaway programs.

Finally, Ms. Lecker summarized the benefits of A.B. 659. She noted the passage of the bill would allow the state to realize the potential return of 8 to 1 on the state’s dollar. Also, through increased support of AmeriCorps, Nevada’s unmet needs in education, the environment, human needs, and public safety could continue to be served cost-effectively. Next, she stated the strong tradition of volunteerism in Nevada could be reinforced through aggressive statewide recruitment of high school and college students. Last, she believed that through AmeriCorps, the future leaders of Nevada would have the opportunity to earn scholarship money while building the idealism and the desire to give back to their communities.

Ms. Lecker then deferred testimony to actual service members who she stated would relate their own experiences as AmeriCorps volunteers before the committee.

First, Janice Ayres, Chairwoman of the Commission on National and Community Service, confirmed her support for the bill. Ms. Ayres stated she had participated on the commission since 1994. She related that she was in her third term as Chairwoman of the commission.

Ms. Ayres reported the commission had been experiencing many difficulties in the past few years, as the commission was not supported by the state. She stated that the AmeriCorps program needed the support of the Legislature to provide stability and to allow AmeriCorps to focus on fundraising and program implementation rather than on operations.

She then noted that all of the commissioners served as volunteers and were not compensated for their time. She emphasized that commissioners should not be compensated as they participated solely because they felt strongly the service provided by AmeriCorps were needed by young people in Nevada. AmeriCorps programs attempted to create safe learning environments and positive programs for young people.

Mr. Hettrick interjected to ask how the program would be impacted if A.B. 659 was not passed. Ms. Lecker replied that the commission had been authorized by its counterpart in Washington D.C. to operate only through June 30, 1999. If the Nevada commission was unable to raise matching funds at that time, the AmeriCorps program would cease to exist in the state of Nevada. Consequently she noted that almost $1 million would be lost.

Mr. Hettrick clarified that the state of Nevada did not have to be the sole source for AmeriCorps matching funds. He understood that the program needed to collect a certain amount in match dollars on its own before a federal grant could be awarded.

Ms. Lecker answered that the administrative grant would provide a maximum of $125,000 per year. The grant was based upon the population of the state. For that reason, she explained the Nevada Commission on National and Community Service had drafted A.B. 659, which requested $250,000 from the state. In turn, should the bill be passed, she stated the federal government would match that amount dollar for dollar.

Mrs. Chowning next expressed her support and appreciation for the AmeriCorps programs by referring to a personal experience she had had regarding service volunteers who tutored in an elementary school in her district. She then inquired if the service volunteers received college credits for their service.

Ms. Lecker responded that unless a program made that specification, service volunteers did not normally receive credit for their work in AmeriCorps service projects.

Next, testifying in support of A.B. 659, was Alicia Valdez, an AmeriCorps service volunteer for Serving-for-Success in Las Vegas. Ms. Valdez stated that she had been serving with the Serving-for-Success program under the North Las Vegas Boys and Girls Club unit.

She reported that in the last year, the program, which consisted of 35 members, had served over 2,000 students. Members provided homework assistance, tutoring, and other educational programs. In addition to serving in various Boys and Girls clubs throughout Las Vegas, she noted that the program Serving-for-Success also served nine elementary schools in Clark County where members provided one-on-one assistance in literacy programs.

Ms. Valdez stated that "Serving-for-Success" in Las Vegas provided children with the motivation to improve their performance in school. Emphasizing the importance of education, the program also helped to develop a love for reading, to increase self-esteem, to provide positive activities for kids, and it taught valuable life and problem solving skills to children.

She felt those children would not be able to benefit from the assistance provided by AmeriCorps volunteers without the state’s support proposed by A.B. 659.

Ms. Valdez then shared with committee member’s success stories of which she had been a part. First, she stated that she had helped a sixth grade student learn and recite the times table from one to twelve and was able to compute multi-digit mathematical problems. In addition to that student, Ms. Valdez reported that she had assisted a fourth grade student to read at the appropriate grade level through tutoring and one-on-one support.

Ms. Valdez then stated that she had been positively affected by her experiences as an AmeriCorps volunteer. She stated that the program gave her personal satisfaction and motivated her to volunteer more extensively. She added that AmeriCorps service projects also encouraged participation in other community service projects.

Also, as a result of her experience with AmeriCorps, Ms. Valdez indicated that she was able to serve as a positive role model for kids, to reinforce her desire to teach, and to continue her college education.

Ms. Valdez concluded her remarks by reading a letter from a student of Sunrise Acres Elementary School, Arturo F. Ochua. She read,

Jeff Freebaker, an AmeriCorps member with the Pinion Service Project, which was headquartered in Virginia City, also testified in support of the bill.

Mr. Freebaker indicated that he was a second year AmeriCorps member who had served in several capacities. First, he stated that he had served as an AmeriCorps volunteer in Fallon, working on direct service projects with tribal youth on the Stillwater Paiute/Shoshone Reservation. Second, he disclosed that he was employed as the Service Learning Coordinator at the UNR College of Education. While serving in that capacity, Mr. Freebaker explained that he worked with university faculty and pre-service teachers to teach the benefits of service learning.

He explained that service learning brought volunteer projects into the school system so that AmeriCorps members worked alongside students on various community service projects. In that manner, AmeriCorps was able to encourage students to offer service to their communities as a means of accomplishing curriculum based goals.

Mr. Freebaker remarked that he was pleased to use teaching as a means to promote community service. In fact, he offered his Composition I and Composition II students the opportunity to serve their communities as a way to develop their composition skills taught by the course. Students used community service in programs like Habitat for Humanity as subjects for their compositions.

Finally, Mr. Freebaker commented that he had been able to extend his experiences as an AmeriCorps volunteer to other teachers throughout the country. He strongly supported the use of service learning as the core methodology for composition courses because skills were learned in context and students were shown how language could be used to develop self-esteem, to increase community awareness, and to increase rates of volunteerism.

Concluding the supportive testimony offered by AmeriCorps volunteers, Ms. Ayres reminded the committee of the June 30, 1999 deadline for the Nevada Commission on National and Community Service to collect match funds. After that point, she stated the commission would cease to exist.

Next, Richard Ziser, representing Nevada Concerned Citizens, spoke against A.B. 659, stating that the bill caused him great concern because he felt it was an expensive way to encourage volunteerism in the state. He did not think that individuals being compensated through scholarships or wages should be considered true volunteers.

Mr. Ziser remarked that there were many true examples of individuals and programs that provided true volunteer service. For example, he cited his daughter’s activity in her high school’s Key Club. He felt programs like the Key Club exhibited the spirit of a volunteer organization.

Furthermore, he felt that federal dollars granted to state volunteer programs misused the taxpayer’s contribution to the government. He insisted that the types of programs that had been suggested by the bill were inappropriately labeled as volunteer projects.

Mr. Ziser was also concerned the increases in academic performance attributed to the AmeriCorps tutoring programs belied the fact that area schools should be implementing their own programs to realize those levels of academic performance. He contended that excess funds should be given to schoolteachers in order to improve the academic standing of schools not to organizations that were not directly involved in the educational system.

To conclude, Mr. Ziser reiterated that the concept, which AmeriCorps espoused, was not an accurate description of volunteer service. Moreover, he felt the claim that AmeriCorps provided a valuable return on the taxpayer’s dollar appeared improbable, especially as the principle upon which they founded their organization was misleading. Again, he opined that AmeriCorps violated the true spirit of volunteerism. Thus, he urged committee members to reject A.B. 659.

Since no other testimony was presented to the committee concerning the bill, Chairman Arberry closed discussion on A.B. 659. The hearing was adjourned at 6:00 p.m.

RESPECTFULLY SUBMITTED:

Janine Marie Toth,

Committee Secretary

APPROVED BY:

Assemblyman Morse Arberry, Jr., Chairman

DATE: