The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 7:00 a.m., on Friday, May 14, 1999, in Room 2135 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Senator Randolph J. Townsend, Chairman

Senator Ann O’Connell, Vice Chairman

Senator Mark Amodei

Senator Dean A. Rhoads

Senator Raymond C. Shaffer

Senator Michael A. (Mike) Schneider

Senator Maggie Carlton

STAFF MEMBERS PRESENT:

Scott Young, Committee Policy Analyst

John L. Meder, Committee Policy Analyst

Crystal M. Lesbo, Senior Research Analyst

Beverly Willis, Committee Secretary

OTHERS PRESENT:

Senator Townsend noted there was a fee in connection with this legislation and proceeded to list several other items in connection with A.B. 204.

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Senator Townsend presented a proposed amendment to A.B. 283 (Exhibit C), noting the proposed amendment had been approved by all.

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At this time, there was discussion between Senator O’Connell, Senator Townsend, and Scott Young, Principal Research Analyst, Research Division, Legislative Counsel Bureau, pertaining to the parameters of A.B. 283. According to Mr. Young, those still representing sports information services are not removed from regulation under this legislation. Senator O’Connell noted this item had been covered in a previous meeting and indicated this point was to be made very clear, stating, ". . . the intent of the committee is they [sports information services] are not to be removed; they are still under regulation."

The next item to be addressed was A.B. 610.

Senator Townsend referred to a proposed amendment to A.B. 610 (Exhibit D). Susan Hobbes, State Board of Architecture, Interior Design and Residential Design, stated she did not have any problems with the proposed amendment.

Senator Carlton, Ms. Hobbes, and Vicki Gonzales, Lobbyist, Mirage Resorts, Inc., discussed the purpose of this proposed amendment. Ms. Gonzales noted the proposed amendment had been offered on behalf of her organization, as there was concern that original language might create loopholes. Ms. Gonzales maintained this language would make sure some entity would be held accountable.

James L Wadhams, Lobbyist, State Board of Architecture, Interior Design and Residential Design, and Inex, explained for Senator Schneider, how this legislation might affect certain educational courses now being offered. Mr. Wadhams claimed A.B. 610 would not obstruct any from practicing in their chosen field.

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Chairman Townsend opened the hearing on A.B. 632.

Senator Townsend claimed there was a problem with a change to this legislation, citing a proposed fine increase to $15,000, from $10,000. Senator Townsend noted there was a concern this increase could be problematic for small companies. He noted more flexibility was needed to address life-safety issues, indicating this type of violation would need a more substantial penalty. For smaller violations, the $15,000 penalty would not apply.

Mr. Wadhams asserted there was a fine-schedule describing the variation in fines, claiming these fines were proportionate to the seriousness of the offense. He noted all fines were subject to judicial review.

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Assembly Bill 635 was the next item to be addressed.

According to Chairman Townsend there was not any opposition to this legislation, noting the insurance commissioner did not have any problems with A.B. 635. A proposed amendment was offered (Exhibit E) for this legislation.

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Senator Townsend addressed A.B. 680.

Senator Townsend referred to a letter, "Political Subdivision With State Self-Insured Health Insurance Plan" (Exhibit F), from Alice A. Molasky-Arman, Commissioner, Division of Insurance, Department of Business and Industry. Senator Townsend offered several other proposed amendments pertaining to A.B. 680; the Nevada Association of Health Plans proposed amendment Exhibit G); an amendment submitted by Mr. Wadhams (Exhibit H); an amendment from Robert R. Barengo, Lobbyist, A and H Insurance (Exhibit I); an amendment from Matthew Sharp, Lobbyist, Frontier Insurance (Exhibit J); with the final amendment (Exhibit K). Chairman Townsend offered a short explanation of each.

Alice A. Molasky-Arman, Commissioner, Division of Insurance, Department of Business and Industry, clarifying for Senator Carlton, stated unadmitted assets would be something like goodwill, or an intangible of some sort.

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Chairman Townsend then addressed A.B. 470.

Senator Townsend directed the committee’s attention to a proposed amendment to A.B. 470 (Exhibit L), proceeding with a review. Samuel P. McMullen, Lobbyist, Nevada State Board of Nursing, Las Vegas Chamber of Commerce, and Retail Association of Nevada, confirmed the Nevada Trial Lawyers’ Association presented this amendment. Senator Townsend then referred to another proposed amendment (Exhibit M). Chairman Townsend reviewed several other proposed amendments (Exhibit N).

Scott M. Craigie, Lobbyist, Liberty Mutual Insurance Group, asserted he would withdraw his amendment in favor of a proposed amendment presented previously.

Lenard Ormsby, General Counsel, Employers Insurance Company of Nevada (EICON), remarked on concerns about some insurance companies undercutting the prices of insurance rates. He implied any present contracts should be honored; however, pointing out that if companies do renege, they could be penalized.

Clifford N. King, Supervisor, Property and Casualty Section, Division of Insurance, Department of Business and Industry, commented on tiered rating, noting in order to avoid unfair discrimination, several factors need to be identified; i.e., what type of business, what risk characteristics, and standard industry codes. He claimed each tier would be investigated.

Senator Townsend, Mr. Ormsby and Mr. Craigie continued their comments and clarification pertaining to honoring contracts and penalties that might be incurred should these contracts be broken. Senator Townsend, referring to proposed amendments to A.B. 470 (Exhibit N) and (Exhibit O) questioned Mr. Ormsby about the number of contracts currently held by EICON. Mr. Ormsby declared several million dollars to EICON. He claimed hundreds of Nevada employers were under contract.

Fred L. Hillerby, Lobbyist, Professional Insurance Agents of California and Nevada, noted his support of Exhibit O. He pointed out, in the past, that Nevada has had a monopoly where workers’ compensation insurance is involved. Mr. Hillerby noted other companies from out of state have been writing workers’ compensation insurance for many years and would possess the knowledge needed to write workers’ compensation insurance.

Senator Townsend determined to hold the discussion on A.B. 470 in abeyance while another item was taken under consideration.

Senator Townsend then addressed A.B. 334.

Senator Townsend explained this legislation had already been amended; however, he asserted the amendment created several problems. Mr. McMullen asked to, ". . . respectfully withdraw the previous amendment." Mr. McMullen requested the legislation be passed without an amendment.

Senator Carlton stated although she had voted in favor of this legislation before, she could no longer support S.B. 334.

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Senator Townsend then asked for a motion to do pass A.B. 334.

Senator Townsend then addressed an issue pertaining to benefits. Senator Townsend stated:

Senator Townsend declared an analysis (Exhibit P) had been prepared, by Crystal M. Lesbo, Senior Research Analyst, Research Division, Legislative Counsel bureau, of PTD in the Nevada, and presented options that might be available. Senator Townsend then referred to facts and figures on page 2 of Exhibit P. To clarify for Senator Townsend, Ms. Lesbo provided an explanation how she had arrived at these findings. Mr. Ormsby joined the discussion addressing concerns on ways of funding an increase of benefits. Mr. Ormsby emphasized problems associated with financing and increase in benefits and also focused on prospective dates for any rate and/or benefit increase. Senator Townsend noted he wanted to alert the committee on the substantial impact of this situation.

Chairman Townsend recessed the meeting at 9:00 a.m.

Chairman Townsend reconvened the meeting at 10:20 a.m.

Senator Townsend, directing remarks to Ms. Molasky-Arman, stated:

Senator Townsend continued his remarks to Ms. Molasky-Arman:

Senator Townsend indicated he had been referring to Exhibit P.

Ms. Molasky-Arman declared language offered in a proposed amendment to A.B. 470 (Exhibit Q) clearly states what filings are to consist of; it describes and defines lost cost. She claimed it indicated the nature of the filings the insurers would be filing with the insurance division.

Senator Townsend proposed amending A.B. 470 with language from Exhibit L as well as Exhibit M that deals with the laboratory testing issue. He included language necessary in order to accommodate the following, "The current law says administered pricing is July 1, 1999 to June 30, 2000, followed by July 1, 2000 to June 30, 2001, with a deviation of 15 percent." Senator Townsend continued, "July 1, 2001, thereafter, being the file-and-use/lost-cost language that is submitted."

To reassure Senator Carlton, a number of involved participants expressed their concurrence with conditions pertaining to A.B. 470. Those responding were Mr. Wadhams, Mr. Ormsby, Mr. McMullen and Mr. Hillerby. Robert A. Ostrovsky, Lobbyist, Nevada Resort Association, also noted his support.

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Senator Schneider reported on the successful completion of legislation dealing with homeowners’ associations.

The next piece of legislation to be addressed was A.B. 293.

Chairman Townsend presented an amendment to A.B. 293 (Exhibit R). He noted this amendment supplemented A.B. 293 with language from mental health parity legislation, that had not been voted into law.

The next item offered for consideration by the committees was A.B. 193.

Tony Sanchez, Lobbyist, Peter Eliades2, presented an amendment (Exhibit S) to A.B. 193. Senator Townsend requested an explanation pertaining to various rules and regulations, as well as county and city ordinances relating to this legislation. Mr. Sanchez explained under existing law the Taxicab Authority has the ability to discipline the driver of a taxicab for accepting money for any reason other than transportation of passengers. He declared city and county ordinances prohibited a business with a liquor license from paying a taxicab driver. Mr. Sanchez asserted the proposed amendment would give the Department of Business and Industry, the ability to monitor and penalize the business violating this edict, as well as the taxicab driver.

Senator Amodei gave details to Senator O’Connell on reasoning behind this legislation and the proposed amendment. He emphasized this legislation would have an enforcement target of specific business owners along with the taxicab drivers. Senator Amodei noted violations, of this type, would be administered by the Taxicab Authority, with passage of A.B. 193.

Robert E. Campbell, Lobbyist, Peter Eliades2, offered clarification on the severity of this problem by noting the Taxicab Authority, with help from various other groups, found this problem was occurring in excess of 30 percent of cab rides.

Senator Amodei clarified by asserting this figure of "30 percent," was 30 percent of cab rides to adult cabarets or exotic dance establishments, not 30 percent of all cab rides.

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Chairman Townsend recessed the meeting at 11:05 a.m.

Chairman Townsend reconvened the meeting at 6:10 p.m. The first item to be addressed was A.B. 60.

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Senator Townsend then called for action on A.B. 515.

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Senator Townsend noted that Assemblywoman Barbara E. Buckley, Clark County Assembly District No. 8, requested A.B. 431 be amended in the following manner. Senator Townsend asserted Assemblywoman Buckley had asked for the removal of sections 11 through 18. She also requested that sections 22, 23, and 24 be eliminated. Senator Townsend recommended the deletion of sections 2 and 3. Senator Townsend clarified several other changes requested by Assemblywoman Buckley.

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Senator Townsend declared, "I am in the automobile industry and I think anything that can enhance the way that industry ought to be run, is positive for everyone."

As there was no further business, the meeting was adjourned at 6:25 p.m.

RESPECTFULLY SUBMITTED:

Beverly Willis,

Committee Secretary

APPROVED BY:

Senator Randolph J. Townsend, Chairman

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