The Budget Subcommittee of the Legislative Commission was called to order by Chairman William J. Raggio at 8:30 a.m., on Thursday, January 21, 1999, in Room 1214 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.

SENATE COMMITTEE MEMBERS PRESENT:

Senator William J. Raggio, Chairman

Senator Lawrence E. Jacobsen

Senator William R. O’Donnell

Senator Joseph M. Neal, Jr.

Senator Bob Coffin

Senator Bernice Mathews

Senator Raymond D. Rawson (Excused)

Senator Ann O’Connell (Excused)

Mr. Morse Arberry, Chairman

Mr. Bob Beers

Mrs. Barbara Cegavske

Mrs. Vonne Chowning

Mrs. Marcia de Braga

Mr. Joe Dini

Ms. Jan Evans

Ms. Giunchigliani

Mr. Lynn Hettrick

Mr. John Marvel

Mr. Goldwater (Excused)

Mr. Perkins (Excused)

Mr. Price

STAFF MEMBERS PRESENT:

Dan Miles, Fiscal Analyst

Bob Guernsey, Principal Deputy Fiscal Analyst

Ginny Wiswell, Program Analyst

Birgit K. Baker, Program Analyst

Patricia Hampton, Committee Secretary

OTHERS PRESENT:

UCCSN System Administration – Budget Page UCCSN-1 (Volume1)

Budget Account 101-2986

Richard S. Jarvis, Chancellor, University and Community College System of Nevada (UCCSN), began by thanking the committee for the support given the system in the past two legislative sessions. He said the support meant Nevada has led the nation in increasing help for public higher education. He pointed out the system has provided education to more Nevadans than was possible two years ago.

Dr. Jarvis gave an overview of the system budget including goals, funding requests and major issues facing UCCSN during the 1999-2001 biennium. (Exhibit C. Original is on file in the Research Library.)

Dr. Jarvis pointed out the UCCSN planning process is directed by the Board of Regents. The Board of Regents met last year to revisit the strategic directions of the UCCSN and reaffirmed there would be an overwhelming commitment to quality without compromise. Dr. Jarvis stated this would be done in ways that are accountable and planned, that maximize the use of resources and technology, and that are productive.

Dr. Jarvis said the Governor’s budget responds in various ways to priorities of the Board of Regents. He stated the primary mission is to serve students. The number one goal is to increase student access, and the Governor’s budget provides modest support for this. He said students will be bearing increased costs in the upcoming biennium. Dr. Jarvis pointed out students are in support of the UCCSN budget.

Dr. Jarvis noted the second priority in the enhancements is support services. He said it is vital the instructional services be supported by essential support services such as libraries, counseling, admissions, and technical support. He expressed disappointment in the lack of salary increases for employees. He said if there is any consideration given to enhancing salaries, he would hope employees of UCCSN would be included.

Dr. Jarvis explained the need to move to the introduction of a select number of limited enrollment baccalaureate programs at Great Basin College. This request was funded in the Governor’s recommendation through the estate tax revenue. The chancellor said there is modest funding in the budget for equipment and technology, which is always a large request by the UCCSN. He referred to the previously funded dental residency program and noted there is continued funding recommended in The Executive Budget.

Dr. Jarvis highlighted the structure of the requests. He pointed out it was done differently this time. There was a desire to provide resources, in a system that is dominated by the need to meet growth, to the campuses which are meeting the growth challenge and are most overwhelmed by the pressure for new students.

Dr.  Jarvis pointed out the largest amounts of increase in the request are sought for those institutions with the largest enrollment growth. He stressed it is most important, in seeking consideration for any adjustments, that as far as possible the committee adhere to and support the distribution of increases requested in the regents’ budget. Dr. Jarvis said this request should be a key part of any discussions of adjustments to the UCCSN budget.

Dr. Jarvis called attention to the current growth from 1997-98 in terms of headcount and full-time equivalent (FTE) students. The system now serves 82,666 (headcount) students, which is a record enrollment in the history of UCCSN. In one year there was an increase of 5.4 percent in headcount and 6.9 percent FTE. Dr. Jarvis pointed out not only are more students being served, those additional students are taking more coursework.

Dr. Jarvis said that this year the UCCSN is budgeted to support an annual average FTE of 42,263 students. It is estimated, based on fall enrollment and using normal projections from fall to spring as statistical projection, by the time spring enrollment is counted the estimated annual average FTE for this year will be 44,916. Dr. Jarvis said this would be 6.3 percent over the budgeted enrollment. This means 2,653 FTE students are being educated in the UCCSN based entirely on the support they provide through their student revenues.

Dr. Jarvis said there are sometimes questions asked about whether the system is growing too rapidly. He pointed out growth is necessary and said perhaps the system is not growing enough. He said the average annual growth rate for the past two years has been 6.2 percent. Dr. Jarvis noted the system has yet to recover from the average annual growth rates for the system that were maintained from 1987 to 1991 when the system as a whole was growing at 8.7 percent. He said growth in the nineties has not been maintained, in spite of the extraordinary support given by the Legislature over the past few years.

Dr. Jarvis focused on the rate of Nevada’s high school graduates continuing on to college. He reported Nevada has the lowest number of students in the United States continuing their education, even though there has been about a 2 percent improvement since his last report. He said for the numbers of students coming out of Nevada’s high schools, only 38.7 percent have any kind of postsecondary experience in the 12 months following graduation. Dr. Jarvis stressed Nevada is a long way behind the national average of 58 percent. He said more help is needed in recruiting Nevada’s young people to college.

Dr. Jarvis said despite the efforts made in the previous two bienniums, the extent to which Nevadans get an education in the 1990s has declined. Although the numbers of students in the collages and universities has grown, access has diminished. Dr. Jarvis said it will be difficult to improve on this with the proposed funding for the next biennium.

Dr. Jarvis referred to page 8 of Exhibit C showing the differences in the UCCSN requests for enrollment in 2001 and what the Governor’s budget recommends. The 50,042 FTE represents what UCCSN needs, not to increase student access, but just to keep up with state growth. Dr. Jarvis pointed out the Governor’s recommendation falls short by 10 percent. He added the differences in funded enrollments are not evenly distributed among the institutions, causing concern. He requested some help in this area. Dr. Jarvis requested that if there is any possibility of funding further growth, funding be done in a way that would get the UCCSN back to the growth distribution projected.

Dr. Jarvis responded to a request made by the Senate Committee on Finance two years ago. He said a survey of high school juniors and seniors was conducted to find out why they do not go to college and what can be done about it. He pointed out 82 percent of seniors and 79 percent of juniors in Nevada’s high schools reported they would like to attend college. The major concern reported was a belief that it costs too much.

Dr. Jarvis stated this concern is being addressed. He said students have bought into the argument the UCCSN needs to keep up with the cost of inflation in higher education. He noted the Board of Regents and students have agreed tuition would be increased at the rate of the Higher Education Price Index (HEPI), which is about 1 percent higher than the consumer price index (CPI), plus a modest annual increase of 1 percent. This would occur as long as the rates remain below the average for the Western states and the students are paying less than 25 percent of the cost of their education.

Dr. Jarvis said that this biennium the tuition rates for in-state students would increase by 4 percent per year. This would be an increase of $2.50 per year at the universities and $1.50 at the community colleges. Dr Jarvis indicated steps are being taken to assure out-of-state students pay the full cost of their education. The  policy for out-of-state students will be to increase the out-of-state tuition, in addition to the registration fees. Dr. Jarvis said there is a 3-year lag built in because it is unknown what the full cost of education will be in 3 years, so these students will be asked to pay the full cost now. This leads to a substantially larger increase for out-of-state students, approximately 10 percent per year.

Dr. Jarvis emphasized the affordability of education in Nevada. The universities rank 14^th out of 16 in terms of tuition costs in the Western states. The community colleges rank 9^th. Even so, the survey indicates high school students believe there are serious financial obstacles to attending college. Dr. Jarvis said ways must be found to address these concerns through recruiting, financial aid and better support. He said the UCCSN is seeking an adjustment in the recommendation of the Governor’s budget for funding.

Tom Anderes, Vice Chancellor, Finance and Administration, University and Community College System of Nevada, reviewed page 11 of Exhibit C and highlighted the goals and intentions of the regents and the expenditure plan. He said the regents’ request has been constructed so there is a balance in the expenditures and there can be growth in the estate tax endowment fund. Dr. Anderes pointed out there will be little growth at the suggested level of $50 million, but it will be sufficient to sustain the level of expenditures being projected now and into the future. He said the ability to move forward from the present level of funding and increase $7 million to $10 million per year means there must be a strong endowment to support that kind of growth because the annual collections from the state are not sufficient.

Dr. Anderes said that with the Governor’s recommended budget of $55 million, there will be a declining balance in the endowment fund over the next 8 years. Ultimately, this would lead to the endowment being unable to sustain the level of expenditures at $55 million. Dr. Anderes expressed concern over the amount of funds going to financial aid, research and technology. UCCSN sees this area as the primary one if there is any additional funding.

Dr. Anderes suggested UCCSN could probably sustain a $50 million level as opposed to the $55 million recommended in the Governor’s budget. He referred the committee to the tab "Estate Tax" in Exhibit C which identifies what would happen to the endowment at various levels of expenditure: $50 million, $55 million and $60 million. The declining ending balances at the various levels shows the depletion of reserves to the extent UCCSN would be unable to continue at that level of expenditure.

Dr. Anderes said this is important, partly to continue the programs but also to address other "threats." He pointed out the estate tax is at the top of the list for elimination or drastic reduction at the federal level. He said if that should happen, it would be necessary to move away from this level of expenditure depending on the type of phase-in period established.

Dr. Anderes recalled the downturn in the economy last fall. He said the endowment dropped $9 million in less than a two-month period and is only now beginning to recover. He pointed out the endowment has performed well over the past 8 years. Dr. Anderes said the state has allowed the endowment to grow, in terms of the collections the state is providing. He said another downturn could be expected again in the future and that would have an implication for the continuing high level of growth and value of the endowment, particularly in light of the expenditures.

Dr. Anderes said the UCCSN would be seeking support for a $50 million expenditure, most of which continues from the 1997-99 biennium. He said the real emphasis is on continuing support for technology, research and financial aid.

Dr. Jarvis discussed the unfunded priorities should there be additional funds available. He said the present budget would most likely support enrollment growth of something less than 2 percent and everything must be done to try to serve the state at a higher level.

Dr. Jarvis reviewed the priorities as shown on page 12 of Exhibit C. He referred to page 40 of Exhibit C which addresses omissions and inconsistencies. He drew attention to two particularly large problems, which would impose an unbearable hardship upon the University of Nevada, Las Vegas (UNLV). The operating and maintenance for new buildings is a critical omission and the system is in favor of moving General Fund support under the Interim Finance Committee (IFC) adjustments as presented in the last interim. Dr. Jarvis said this is where support for additional students has been provided. Those resources have been moved into instructional funds and there must be an ability to keep the salary structure in place and keep the support positions. Dr. Jarvis asked for additional support, particularly for those institutions identified under the second category, especially UNLV. He said should any additional funds become available, this would be the number one priority before anything else is added.

Dr. Jarvis also requested that should any funds become available to provide any cost of living adjustments (COLAs) for state employees, the UCCSN receive equitable consideration with other state employees.

Dr. Jarvis stated the UCCSN could do more with the resources they have if provided flexibility in several critical areas. He presented a number of considerations to be discussed during the course of this legislative session as shown on page 13 of Exhibit C.

Dr. Jarvis emphasized that a top priority for the Board of Regents is to have a comprehensive funding study in the next biennium. He stressed it will be critical to have legislative leadership and participation in the effort to build a new model for funding.

Dr. Anderes outlined the capital improvement projects (CIPs) list shown on pages 14 and 15 of Exhibit C. He focused on additional funding for the tier 1 requests. He noted the State Public Works Board (SPWB) has done an excellent job in moving forward through the first 7 projects, identifying alternatives that are possible, depending on the funding available, to move to project 13.

Senator Raggio said the Governor’s budget has placed authority for 2 percent in growth across the system, not unlike what occurred in 1992. He asked how the system dealt with the situation at that time. He said the budget does authorize the collection of revenues from student fees at the 6 percent revenue level. Senator Raggio pointed out there will be more FTEs than are accommodated at 2 percent.

Dr. Jarvis replied he could not answer with specifics because what occurred in 1992 was before his tenure as chancellor. He said this budget, by including the additional student fee revenue, is producing a significant shift of the burden of support to the students. Consequently, it is important for the institutions to do as much as they can to get additional students into classes. Dr. Jarvis said they can do better than 2 percent. There was funding for 4 and 5 percent this biennium and there is over enrollment of 6 percent now. Dr. Jarvis said this shows the ability to take additional students.

Senator Raggio stated UCCSN will have the authority to come to IFC to request utilization of the revenue from those sources for those purposes. Dr. Jarvis said the flexibility portion of this request would be most critical. He said more could be done for the state with the ability to address the funds in a flexible manner, have the carryforward, and catch up with college access for Nevadans.

Dr. Jarvis emphasized there is no question the UCCSN will fall further behind in this biennium, but said he hopes this is a short-term phenomenon which will be approached in short-term ways.

Senator Raggio asked how much is presently in the estate tax reserve. Dr. Anderes replied currently there is $93 million in the endowment and the projection is $100 million by the end of Fiscal Year (FY) 1999. Senator Raggio said it is his understanding that if the Governor’s recommendations were followed, including what is already committed and what is proposed to be committed to budget needs, there would still be $70 million in reserve. Dr. Anderes answered that is correct. Senator Raggio referred to a policy establishing the need for the reserve to stay at a minimum of $2.5 million in income. He said more than $2.5 million income would be realized from a $70 million reserve. Dr. Anderes agreed. He said the issue with the use of the dollars at the $55 million level is not an issue in the next two bienniums, it is the cumulative effect over time that begins to deplete the endowment, if expenditures are maintained.

Senator Raggio asked for elaboration on what deletions would be recommended and how one would deal with those priorities. Dr. Anderes answered the primary area for deletion would be in equipment and technology; these areas would be reduced from $7.98 million to $5 million. He said there is also an additional reduction in continuing program support. Dr. Anderes pointed out existing programs will stay at the same level of funding during the next biennium, with no allowance for inflation or growth.

Senator Raggio said he does not understand the reasoning behind the proposal to delete equipment. He asked what would be gained by deleting $5 million from equipment technology priorities. Dr. Anderes replied there is no question that equipment would be one of the first areas to be restored with any additional funding. He said the only way to understand why the $55 million has to be reduced to $50 million is the long-term implication. Senator Raggio said there is nothing which states that once a level of funding from the estate tax has been established it has to be maintained at that level of estate tax use. He questioned why the UCCSN would want to short themselves when there is a need for equipment and technology.

Senator Raggio cautioned that if the Economic Forum should project some substantial additional revenue, there would be many requests for the funds. He said that until this should occur, the budget must be looked at realistically to see what the law presently requires that the Legislature observe.

Senator Coffin inquired why there is a need for another funding study. He said many studies have been conducted in the past and with the numbers of competent staff at UCCSN, the issues could be presented and discussed during this legislative session. He stressed that findings from a study could not be discussed until the next legislative session.

Dr. Jarvis responded the fundamentals in understanding the needs for the UCCSN have changed over the years. He said this change needs to be approached in a collaborative way. The chancellor said this was most successfully done the last time through a funding study, which has served UCCSN for a long time. He said the current budget requests depart drastically from those formulas. Dr. Jarvis pointed out the current budget request targets growth and attempts to provide resources to the institutions growing most rapidly. He said the system’s budget next biennium would reflect new considerations, based on old formulas but trying to put in new considerations as identified.

Dr. Jarvis stated the system is already into the process and the best way to do this is to have the legislative leadership participate in the funding study, which would provide something the system can commit to for an extended period of time. He said this would impose the possibility of substantial new needs that were not previously recognized. Dr. Jarvis pointed out the present study proposed that any increases generated be phased in over a period of time, so that rather than hit everybody with a huge shock all at once, there be a planned agenda of how to arrive at the desired destination.

Senator Coffin expressed the idea that perhaps there was not follow-through after the last study. He asked who the chancellor meant when he referred to legislative leadership. Dr. Jarvis answered he was just "copying the membership structure" from the last bill introduced. Senator Coffin urged that the full debate on this issue be brought out during this legislative session.

Senator Neal asked how often a report is received on the endowment investment. Dr. Anderes answered his office deals with the estate tax on a weekly basis in terms of what is coming in from the state and the investments.

Senator Neal asked why figures reflected after the recovery of the stock market were not used in the presentation instead of August 1998 figures. Dr. Anderes responded they are not trying to alter anyone’s views of whether $50 million or $55 million should be used based on the example shown. He said most of the things that have happened over the past several years have been very good in terms of the investment strategies and the strategy outcomes. The example is used only to show that at a given point something negative can happen. Dr. Anderes referred to what the implications would be for the ending balances under the other alternatives.

Continuing, Dr. Anderes said the basis for the example is not taken from August 1998 figures. He stated, "What we have done is a very long-term historical trend on all of the data and the investments seen in the gains and loses are within the same area in terms of percentages as the past three or four years." He stressed that if all of the resources are to be prudently managed, the negative possibilities must be considered, particularly if there is an expectation more funds will be expended each year. Senator Neal said he could not fault being cautious in this regard.

Mr. Dini inquired about the enrollment figures. He said it would seem there is a disproportionate share of out-of-state students attending the two universities. Dr Jarvis replied he would not characterize this as disproportionate. He said the portion of out-of-state students is primarily due to the mix of programs, students in graduate programs and undergraduate programs. Generally universities of the same size as the University of Nevada, Reno (UNR) and UNLV typically have approximately 22 to 24 percent out-of-state students. Dr. Jarvis said this is monitored closely and the system has tried to increase out-of-state tuition, so that these students are paying the full cost of their education.

Mr. Dini asked what the plan is to get more Nevada students into college. Dr. Jarvis said more information regarding financial assistance needs to get to the students. He expressed pleasure in the Governor’s plan to use funds from the cigarette settlement for scholarships. He said a much better job needs to be done in letting students know about the opportunities available to them. He said there are outreach programs in the high schools attempting to make it clear to these students that college is for them.

Mr. Dini acknowledged the community collages have done a good job in their outreach but said he does not think that is the case with the universities. He said there are several high schools in his district and he sees a very small percentage of those students interested in attaining a higher education. He stated that no matter how many programs there might be, if the students do not attend, there is no point in trying to establish policies.

Ms. Evans communicated she is an employee of the UCCSN. She referred to page 9 of Exhibit C, showing Nevada to be last in the United States in students continuing on for higher education. She inquired what questions were asked in the survey. She said there would seem to be important variables, other than cost, since Nevada has almost the lowest tuition costs in the West.

Dr. Jarvis said the survey is complex and he would see that Ms. Evans receives a complete report. He stated Nevada has always been a low-tuition state, but only recently has the financial aid been increased substantially. Until the previous biennium, Nevada was in the bottom two or three states in the country for state-based financial aid. Dr. Jarvis said he does not believe students are aware of this increase. He added also the current culture has something to do with students’ attitudes about attending college, as Mr. Dini indicated. Dr. Jarvis said the system has a big marketing job ahead to get the word out regarding the availability of financial aid.

Mr. Arberry requested the chancellor provide a listing of the administrative salaries over the time period FY 1990 through FY 2000, and the percentage breakdown of increases for that time period, before the committee meets as a subcommittee.

Ms. Giunchigliani noted the chancellor had stated the Legislature has not said merit increases cannot be awarded to administrators. She commented this is not accurate. She said that in 1987 it was determined merit was not to be awarded to administrators and this position was reaffirmed in 1991. Ms. Giunchigliani reminded the chancellor that positions at the level of dean or above are not to be included in the merit salary pool. She asked whether there is a commitment now to follow the policy and not award merit above the dean level.

Dr. Jarvis responded it has not been the system’s understanding the awarding of merit was prohibited for administrators. He said the determination of the merit pool sets the base on which the total amount of merit funding is available for faculty. He emphasized it was not his understanding this was forbidden. He stated the system is consistent with legislative intent, as it is understood.

Ms. Giunchigliani said if this is the case, there needs to be more clarity. She said she distinctly remembers the exclusion of higher-level administrators for merit because she served on the higher education subcommittee at the time this policy was made. She expressed the hope the subcommittee would take up this issue and make it very clear. Ms. Giunchigliani said there has been some disparity and this in the long run creates ill will among faculty. She indicated she also has an issue with the administrative raises that, compared to other areas, have increased extraordinarily.

University of Nevada, Las Vegas – Budget Page UCCSN-16 (Volume 1)

Budget Account 101-2980

Carol C. Harter, President, University of Nevada, Las Vegas (UNLV), provided the committee with a handout entitled "Accomplishments & Aspirations" (Exhibit D. Original is on file in the Research Library.).

Dr. Harter acknowledged the committee for the support provided to the system in general and particularly UNLV. She said the Lied Library and the law school have taken the university to another level of development. Dr. Harter thanked Mr. Arberry in particular for providing the planning funds for the law school in June of 1995. She also commented that funding for gender equity in athletics and research initiatives has been remarkably important to the development of UNLV.

Dr. Harter reviewed the items shown in Exhibit D. She spoke of the enrollment growth, which she said does increase access for Nevada students. She said the number of Nevada students attending UNLV has been increasing by approximately 1 percent a year for each of the last three years. Dr. Harter pointed out there was little growth from 1992 to 1995. She said growth since that time has been dramatic and continues upward. She stated the conservative estimate is that UNLV will grow minimally at 5 percent a year. This would put the student population at 35,000 by the year 2009. Dr. Harter said the ethnic minority enrollment has steadily increased and is currently 23.6 percent of the total enrollment. She pointed out the percentage of full-time to part-time students has also increased.

Dr. Harter noted transfer contracts with students at the Community College of Southern Nevada (CCSN) have gone well. In 1997 there were 296 contracts for transfer between the two schools and this year there are 1,141. She said there is very good advisement to help students integrate courses so they do not lose credits and to create the best environment for matriculation.

Dr. Harter said that last biennium, full growth funding enabled the university to provide for a higher-than-expected enrollment and teaching faculty to support those students. She said 32 new faculty and 6 new staff were hired, allowing UNLV to continue providing a high-quality education. Dr. Harter requested an increase in growth funding if more new funding becomes available. She said to fully implement the teacher preparation proposal, growth funding is necessary to hire the faculty in education who will assist in preparing additional teaching students for the Clark County School District.

Dr. Harter referred to the allied health initiative shown on page 13 of Exhibit D. She said there is a list of new programs the university would like to begin over the next biennium and the funding needed to implement and support the programs. She pointed out these programs would provide professionals in areas where the appropriate number of health professionals is unavailable. She stated this is a major set of new initiatives unfunded in the current budget. She said were UNLV to receive full growth funding, they could start hiring the necessary faculty to begin these programs.

Dr. Harter said she is very positive about the university’s ability to contribute to economic diversification in the southern part of the state. She stated individuals at UNLV are currently in dialogue with several large companies regarding the creation of major new high-tech programs that would have the potential to attract new business and new employees to the state of Nevada.

Dr. Harter indicated there is a great need for support services requested, as shown on page 7 of Exhibit D. She said this request is to try to make up for some past deficiencies. She pointed out how UNLV will be restricted should additional funding not be made available.

Dr. Harter emphasized the critical need for equipment and the technical staff to keep the equipment updated and operating. She said when technical help is unavailable it becomes very difficult to advance technologically.

Dr. Harter pointed to a request for $2.6 million in additional graduate student stipends in the support formula request. She said this helps the access issue and the development of graduate and research programs and provides a significant source of instruction at a relatively low salary compared to full-time faculty.

Dr. Harter reviewed the equipment request shown on page 9 of Exhibit D, as well as the implications of lack of funding. She said the UNLV administration would be grateful for one-shot funding for equipment needs.

Dr. Harter discussed the teacher initiative. She said that with the help of CCSN, at the end of year 2003, 1,200 teachers could be produced yearly. Most of these teachers would teach in the Clark County School District. Dr. Harter said Brigham Young University (BYU) produces the most teachers of any school in the United States and with the proposed teacher initiative, UNLV would be tied with BYU in producing teachers. She emphasized the need to be funded for growth if this is to occur. Dr. Harter said that had UNLV had been funded at 5 percent, the intent was to assign 21 of the new faculty to the College of Education. She stated that at a significantly lower growth funding, this commitment could not be fulfilled.

Dr. Harter said UNLV would continue to try to allocate as many of the university’s own resources into the program as possible. She said the number of teachers produced has increased from 230 in 1994 to 565 in 1998 entirely with UNLV’s own resources, which meant reallocating faculty positions into the College of Education. Dr. Harter stressed this has been a commitment of millions of dollars of faculty time provided by the university, and now assistance is needed from the Legislature to arrive at the final number of projected teachers to be produced.

Dr. Harter acknowledged the difficulty in funding the dental program this year as shown on page 14 of Exhibit D. She said the development of the complete listing of health-related programs is seen as part of UNLV’s future.

Dr. Harter pointed out women athletes have been accommodated at a higher level. New volleyball and soccer programs have been created and a women’s golf program is planned. She said with these programs in place UNLV should be in compliance with Title IX. Dr. Harter pointed out Nevada will be only the second state in the nation to provide gender equity funding directly to the universities.

Joseph Crowley, President, University of Nevada Reno, highlighted areas in the report provided to the committee (Exhibit E. Original is on file in the Research Library.). He expressed appreciation to members of the joint committee for the help that has been provided to higher education over the years.

Dr. Crowley said that on page 2 of Exhibit E, the new funding received for the instructional budget is in the maintenance areas of inflation, new space, and occupational studies/fringe benefits. He said there are no General Fund increases for enrollment growth. He pointed out the proposed areas to receive General Fund increases or decreases as noted on page 3 of Exhibit E. He said the legislative initiatives for 1997 consisted of $12.1 million for FY 1998. Dr. Crowley called attention to one appropriation for hazardous materials management. He said the funding provided allowed the hiring of 7 additional FTE staff and increases the operating budget by more than $250,000. He said UNR is now in compliance with an audit conducted as a result of the consent decree that was issued by Washoe County District Court.

Dr. Crowley reviewed the use of funding previously received by the University of Nevada, Reno School of Medicine as indicated on pages 6 through 12 of Exhibit E. He called particular attention to the $50,000 per annum appropriation in the General Fund for gender equity. He said a golf coach was hired for the new women’s golf program. He emphasized this funding provided a tremendous boost that paved the way for two remarkable private contributions to the women’s sports program.

Dr. Crowley called attention to the 51 applied research initiative projects provided for by estate tax funding. Of these, 41 are applied research and development projects with Nevada companies, 6 are projects with national or international advanced technology firms with ties to Nevada, and 4 represent matching opportunities on federal grants.

Dr. Crowley said funding allowed the hiring of eight computer system administrators (CSAs). The departments and colleges have benefited significantly from the work of these individuals. Dr. Crowley said this funding has made a big difference, although the need for technicians continues to grow.

Dr. Crowley stated many other things have been funded through the estate tax, including the Small Business Development Center, which has been funded for many years. He explained most of the increase went to hire an additional business counselor for the Las Vegas sub-center. He said the funds have been used to increase the number of entrepreneurs in Henderson receiving assistance, by 96 percent in one year and the entire Clark County client assistance by one-third.

Dr. Crowley said the 1999-2001 request seeks to continue funding for the existing programs and provide funding for approximately 7 additional CSAs and a webmaster to oversee the further development and refinement of the UNR web pages. He added the Governor has recommended that the estate tax be used to fund increases of $250,000 a year for gender equity and $556,040 for the Dental Residency Program in FY 1999 and $567,434 in FY 2000.

Dr. Crowley noted the projected enrollment increase of 2.34 percent for
FY 1997-98 was achieved and it appears the projection of 2.8 percent for the current year will be met. He said increases of 2.8 percent and 3.2 percent, respectively, are projected for the two years of the next biennium. He pointed out the impact of these increases will be that the current 498 FTE faculty will be exactly the same number that will be allotted during the second year of the biennium, to serve a 6 percent enrollment growth.

Dr. Crowley referred committee members to a listing of capital improvement projects (CIPs) shown on page 14 of Exhibit E. He thanked the committee for funding the parking structure that is now open. He said the garage is very nice looking and came in under budget. Dr. Crowley added the other component of the structure, the student services building, will begin in 1999. He pointed out a significant contribution of private funds is providing for this addition.

Dr. Crowley called attention to the Governor’s recommendation of $5 million for Phase I of the Redfield Campus. He said there is a $5 million matching grant from the Redfield Foundation. Another $2 million must be raised to build a multi-use facility that will house coordinated programs of UNR, Western Nevada Community College (WNCC), and Truckee Meadows Community College (TMCC). Dr. Crowley said this will serve the education needs for a rapidly growing population in south Reno and in Carson, Douglas, and Storey Counties. It is to be developed over 25 years. Dr. Crowley indicated most of the necessary funds would be raised privately to supplement state support. He spoke about the population in the area, which encompasses a 4-mile radius, with an anticipated population of 72,000 by 2015.

Dr. Crowley said several other projects and issues are listed on pages 18-19 of Exhibit E. He said that 10 years ago the instructional operating funds per faculty FTE stood at $5,216. This year, it is $4,460 and therein lies the problem.

Dr. Crowley referred to three projects mentioned earlier, where the impact of the required vacancy rate is considerable. He said two of them, Agriculture Extension and Cooperative Extension, kept a significant number of position vacancies to be filled by the new dean, and inadvertently this penalizes those budgets. Dr. Crowley explained the Agriculture Experiment Station and the School of Medicine follow the practice of placing faculty positions on grant funding and using the state funds for faculty to strengthen research. He said his practice is followed across the country and brings results to the state as well as the university. He explained this makes UNR more competitive for additional research projects and brings more overhead funds to the university and the state. Dr. Crowley said it can be seen that salary savings have a considerable impact, as shown on page 21 of Exhibit E. Dr. Crowley expressed the hope this issue, a critical one for these appropriation areas, can be addressed during the present legislative session.

Dr. Crowley stated the UCCSN has never been forbidden from giving administrators merit pay. He said he could recall no time when funds from the merit pool have been used for this purpose. He stressed he has been told the university should not use the merit pool funds for administrative merit for the exempt administrators, and not one time in 14 years has this ever happened. He said this matter was discussed at length during an interim study in the late 1980s or early 1990s, and university administrators have been very open about this. Dr. Crowley added that every faculty senate in every institution in the system has supported a separate merit allotment, to be no more percentage-wise than that accorded faculty. He said that in the current year the merit pool for those exempted positions was not 2.5 percent, as it was for faculty, but rather 1.6 percent. He emphasized he cannot imagine why the Legislature would want to forbid an institution from rewarding meritorious conduct.

In conclusion, Dr. Crowley addressed the need for a funding study. He said the Legislature did the first interim study in 1969 that led to the first funding formulas. Others have been done since this time, but the institutions are now different. Dr. Crowley agreed that what Senator Coffin suggested, discussing the issues this legislative session, could be done, but said in his view it would be a lot of effort for naught. He said there are some serious questions confronting the UCCSN, serious disagreements within the system, and the Legislature’s help is needed to resolve these disagreements. He pointed out a funding study has been on the request list for several legislative sessions. He said it is now absolutely critical.

Community College of Southern Nevada – Budget Page UCCSN-64 (Volume 1) Budget Account 101-3011

Richard Moore, President, Community College of Southern Nevada, referred to page 2 of a handout (Exhibit F) reporting the use of funding provided to the college this biennium. Dr. Moore said the two high-tech centers were finished on time and below projected costs. He stated the bids for principal buildings have come in under cost and are being built ahead of schedule.

Dr. Moore said page 3 of Exhibit F shows that two years ago, 250 students graduated from the Community College High School. Of those, 100 percent went to college and now, two years later, 86 percent are still in college. Dr. Moore pointed out the success of the high school dropout prevention program. He explained the high schools identify the 100 most likely students to drop out of school. Seventy of the students were accepted into the program and of the 70, 58 completed high school and 27 continued on to college.

Dr. Moore called attention to the numbers of Clark County high school graduates going on to CCSN. In the fall of 1997, 1,087 students graduated from high school and continued on to college. In the fall of 1998 that number increased to 2,218. Dr. Moore stressed this occurred due to aggressive recruiting and counseling. He told high school students if they graduate from a Nevada high school and are a Nevada resident, he would see that their first class at CCSN would be free. He said he started scholarships from financial aid funds to cover the tuition. Dr. Moore emphasized that in the fall of 1998, the number of students graduating from high school in his region and attending CCSN doubled. He agreed with Governor Guinn’s plan for funding college tuition, saying, "If you provide scholarships for Nevadans based on merit, you will get more students to attend college."

Dr. Moore referred to the chart on page 4 of Exhibit F that shows the increase of student headcount from 17,113 in the fall of 1994, to 30,440 in the fall 1998. He said the FTE has increased from 7,111 in the fall of 1994 to 13,135 in the fall of 1998, as shown on page 5 of Exhibit F.

Dr. Moore reviewed the chart on page 6 of Exhibit F showing the number of FTE the college is serving, versus the level of support provided from the state. He pointed out that today the college is 1,000 FTE over the number it is funded to serve. He said this is a direct effect of the recruitment and financial aid provided. He added that if the trend continues, there will be a need for additional facilities to accommodate the increased number of students.

Dr. Moore said the most important capital improvement project for his campus is the science building, containing science facilities that will support the health fields as well as general sciences. He told the committee a private foundation is very interested in adding a planetarium and Imax Theater as well as a wall showing geology depicting 300 million years of change. He said there are two high-tech centers not yet funded shown on page 7 of Exhibit F.

Dr. Moore emphasized that when a high-tech center is placed on a high school campus, the teaching that is done at the high school is forever changed. He said that with one funding, a computer lab is funded for both the high school and the community college. This allows high school students to use the lab in the morning and college students to use it in the evening. Dr. Moore said there is discussion with the Clark County School District about having teachers who are not too familiar with computers use the lab after school to receive professional training. He pointed out that if the center in Pahrump is funded, Nye County has offered to add $1 million to the project and the Economic Development Authority has allocated $1.4 million. This would provide a $7.4 million facility. Dr. Moore said if the center in Green Valley is funded, a private developer has already donated the land, adjacent to the high school, and utilities.

Truckee Meadows Community College – Budget Page UCCSN-67 (Volume 1)

Budget Account 101-3018

John Richardson, President, Truckee Meadows Community College, referred the committee to page 3 of Exhibit G. (Original is on file in the Research Library.) This chart shows instructional access that tracks FTE from FY 1997 to FY 2001. Dr. Richardson pointed out that in all of these years the college has served more FTE than provided for in state funding. He stated the budget adopted two years ago was a net decrease for the college in FTE enrollment of 98 students. Dr. Richardson said this was argued against during the legislative session because it was known enrollments would go up. He said 18 percent more students are being educated than what is allocated in the current budget.

Dr. Richardson pointed out the community colleges are funded for 60 percent part-time faculty versus 40 percent full-time faculty, whereas the universities are funded at 100 percent full-time faculty. He said that to provide instruction for the additional students, TMCC has had to change this formula and is currently using 44 percent part-time faculty and 56 percent full-time faculty. Dr. Richardson said the projected enrollment increase over the next two years is 7 percent per year. He said that under the Governor’s budget, the college would be funded for 4,654 students when the expectation is there will be 5,253. Dr. Richardson told the committee the gap would most likely be filled with part-time faculty. He said this is a problem. He testified he can pay part-time faculty $425 per credit hour of instruction. Dr. Richardson called attention to the fact he recruits against UNR, which pays $600 per credit hour of instruction. He said that under these circumstances, he could not recruit enough part-time faculty to be able to offer needed classes. Dr. Richardson maintained these kinds of problems need to be addressed by the Legislature, the Board of Regents, and the system.

Dr. Richardson reviewed the operating budget requests shown on page 7 of Exhibit G for dental hygiene, grant-in-aid, and support formula revisions. He said that last legislative session, $220,000 was appropriated to begin the planning for a dental hygiene program. More than 200 students have completed prerequisites to enroll in the program, scheduled to begin in January 2000. Dr. Richardson said the operating budget request for hygiene is not included in any estate tax funds. He mentioned the funds would assist primarily in acquiring equipment to start the program.

Dr. Richardson listed the capital improvement projects shown on pages 8 and 9 of Exhibit G. The  two requests are for a student center, to be completed in two phases, and a technology center. Dr. Richardson said the result of the reductions from the original request will be to "shell in" the building and complete one of three floors included in the space.

Dr. Richardson called attention to an agreement with the Washoe County School District to develop a second TMCC high school at the proposed technology center that would focus on computing and computing technology. He explained the second floor of the current facility on Edison Way would be remodeled to house a high school for approximately 250 to 300 students as shown on page 13 of Exhibit G. Dr. Richardson said these students would take high school classes in combination with college classes that would focus on mathematics, science and computing. He emphasized that in discussions with local employers in the area, the employers have indicated it is impossible to find enough trained employees. He indicated the process of developing an employee pool needs to begin at the junior high school level.

Western Nevada Community College – Budget Page UCCSN-61 (Volume 1)

Budget Account 101-3012

Michelle Dondero, Interim President, Western Nevada Community College (WNCC), said the handout she provided is a fairly complete overview of WNCC (Exhibit H. Original is on file in the Research Library.). She started with the capital improvements requested for funding shown on page 6 of Exhibit H. Ms. Dondero explained this will fund the first free-standing library at WNCC and also includes a student union. She said this is on the Governor’s list of recommended projects.

Ms. Dondero called attention to the artist’s rendition of the proposed high-tech center shown on page 4 of Exhibit H. She explained this center would be located at Carson High School. It is in the budget and is currently on schedule for completion. The college is in the process of finalizing the agreement with Carson City School District.

Ms. Dondero referred to page one of Exhibit H. She stressed the need for full funding of the instructional budget, teaching assistants and merit for part-time instructors. She said teaching assistants allow a larger number of students to be taught at a reduced cost and are particularly necessary in the science laboratories and computer classes. Ms. Dondero explained the second priority is for additional one-shot equipment funds. She said this funding is always important and told the committee that within the packet there is specific and detailed information regarding the equipment needs at WNCC.

Ms. Dondero pointed out the science and technical labs are quickly becoming obsolete. She said 50 percent of the computing labs are obsolete and currently unusable with today’s software.

Ms. Dondero called attention to the fact that throughout its seven-county service area, WNCC trains hundreds of employees each year. She said that without adequate and up-to-date equipment, WNCC would not be able to provide this much-needed training to area employers, businesses, and state and public agencies. She noted that over 2,000 students have been trained in the areas of welding and computing applications over the past two years.

Ms. Dondero said another issue for WNCC is additional funding for the support formula. She explained support funding enables the college to provide the needed services as outlined on page 3 of Exhibit H. She said current funding levels are not adequate and services may be affected if this level of funding continues. Ms. Dondero stressed the need for cost of living increases for all employees should funding become available.

Ms. Dondero concluded with references to enrollment trends shown on page 14 of Exhibit H. She said approximately 200 recent high school graduates attended WNCC in the fall of 1998. She added there is also specific information included on budget requests shown on page 15 of Exhibit H.

Great Basin College – Budget Page UCCSN-57 (Volume 1)

Budget Account 101-2994

Ron Remington, President, Great Basin College, provided a handout showing an update on capital projects and priority needs in 1999-2001 (Exhibit I). He called attention to the renovation of the current library, made possible with funding in the amount of $2.5 million. He said the stack space will be doubled and seating space will be increased by three times what is currently available. Dr. Remington indicated paving of the campus loop road has been completed.

Carl Diekhans, Vice President, Administrative Services, Great Basin College, reported the Ely Conservation Camp crew will begin constructing the addition to the Ely branch in the spring of 1999. The project was to include the addition of administrative offices and a vocational shop to the existing building. Mr. Diekhans said that using the conservation camp has enabled the college to complete both additions. He said there is $50,000 in the Great Basin Foundation that can be used to help finish the inside of the additions. He reported the Ely Foundation also has some funds it is willing to commit to the project.

Mr. Diekhans remarked the landscaping has been completed at the Winnemucca branch of the college and equipment and furnishings have been purchased for the building.

Dr. Remington stated the new request is for a high-tech center to be located on the Great Basin campus adjacent to the Elko High School. The facility would provide computer labs, science labs, classrooms and a distance education center. Dr. Remington said the hope is the center will provide access for district personnel, as well as the college, for professional development and high-tech labs for both college and high school students.

Dr. Remington highlighted the needs as shown in Exhibit I, which other presidents spoke about. He maintained Great Basin College is a fast-growing institution. He said that over 10 years, the college has grown approximately 140 percent. Dr. Remington pointed out this growth rate is second only to CCSN. He suggested the enrollment situation in north-central Nevada is mainly dependent upon mining operations. He said when there are layoffs there is uncertainty and many times enrollments decline. Dr. Remington pointed out the number of FTE students under 24 years of age has increased by 6 percent.

Dr. Remington supported the add-on requests in the areas of academic support. He said that as regional campuses are built in Winnemucca and Ely, additional support will be necessary to provide students with advisement, to maximize the efforts of the students so they can continue in the right direction. He said some of the positions he believes to be necessary are shown in Exhibit I. He added that equipment is extremely important for every postsecondary institution in the state. He said anything that can be done to enhance this request would be appreciated.

Dr. Remington said he was gratified the Governor has chosen to incorporate the request for baccalaureate programs in the estate tax portion of the budget. He suggested the college would like to maintain the mission and philosophy of a community college, yet go forward in select areas to offer a few baccalaureate degrees. He indicated one of these areas would be an elementary education program. Dr. Remington stated the college has a very good working relationship with the school districts in the five counties the college serves.

Dr. Remington said an elementary curriculum is currently being established. He called attention to the fact the two universities in the state supply only about 7 percent of the new teachers hired in the college’s service area. Presently, 93 percent of new teachers hired in northeastern Nevada come from out of state. Dr. Remington said there is also a concern many good Nevada students attend school out of state and do not return.

In conclusion, Dr. Remington identified two other programs Great Basin College would like to offer, a business degree and an applied science degree. He said that at some point the college would like to add a baccalaureate degree in nursing.

Senator Raggio recognized Michelle Dondero as the new interim president of WNCC and Stephen Wells as president of Desert Research Institute. He said he hoped they would always feel welcome at the hearings.

Desert Research Institute – Budget Page UCCSN-54 (Volume 1)

Budget Account 101-3010

Stephen Wells, President, Desert Research Institute (DRI), testified on DRI’s budget (Exhibit J). He called attention to the Governor’s recommendation to continue, with some increase, use of the estate tax funds to cover operating and maintenance expenses for the new Northern Nevada Science Center. He said this center would be opening within the next two months.

Dr. Wells addressed the key issue of research in the UCCSN. He thanked the Legislature for its initiative during the last biennium with the estate tax funding of the Applied Research Initiative. He said this was a great success. Through these funds DRI has realized resources to collaborate with private industry in Nevada and to significantly increase funding from both private industry and federal sources. Dr. Wells said these funds have been used to leverage opportunities with Nevada businesses.

Dr. Wells expressed appreciation for the Governor’s recommendation for the continuation of the Applied Research Initiative as well as an increase to the basic research funds for the universities and DRI. He said this type of support would provide basic funding for innovative research and maintain the assistance to businesses in the state. Dr. Wells maintained this is critical because investing in the research capabilities of the university and DRI is probably one of the most important steps for securing Nevada’s economic future. He said the potential for economic diversification and job creation will increase fundamentally through the combined forces of private industry and Nevada’s academic research institutions. He emphasized the funds budgeted from the estate tax provide the seed capital and will ultimately lead to industry development throughout the state.

Dr. Wells addressed the need for equipment that is on the UCCSN add-back list. He said DRI definitely supports this add-back request and urged the Legislature to give equipment very serious consideration. He stressed all of the campuses need state-of-the-art equipment, but the research campuses must have such equipment to remain competitive. Federal grants and contracts provide some equipment for particular projects, but in order to take on new initiatives, state investment in high-tech scientific equipment is required.

Dr. Wells said the need for new equipment in the new faculty start-up packages is another serious issue. He stated this is fundamental so that the universities and DRI can remain competitive to both attract and retain the best and brightest faculty for educating students.

Dr. Wells said that during the last biennium DRI purchased equipment items, which have opened opportunities for research and technological industries in Nevada. One of these items is a machine for water analysis that has taken DRI into new areas for ice analysis and reconstructing climate change, as well as cloud physics. Dr. Wells stated other instruments allow innovative ecological and microbial studies to be conducted. He said there are high-end computers to enhance modeling, and work in atmospheric and groundwater studies. He reiterated the funds were used to enhance the ability to attract high-quality faculty.

Dr. Wells said a state-of-the-art soil characterization laboratory was equipped to enhance studies of accelerated healing and rehabilitation of government land in Nevada and the western United States.

Dr. Wells concluded with DRI’s capital projects. He said there is one request on the tier 1 list, a Phase II project in southern Nevada, for a building to be constructed on the present DRI campus in Las Vegas. He stated he understands the fiscal pressures existing during this legislative session. However, he said, this is a unique project in that it will only cost the state 20 cents on every dollar to construct a 48,000-square-foot building. Dr. Wells said this is a joint partnership with the U.S. Department of Energy (DOE) that will provide 38,000 square feet. to house artifacts uncovered by scientists working on the atomic test site, and to hold 350,000 documents covering the history of the atomic age.

Dr. Wells said these artifacts and documents will be made available to the public, particularly to students and researchers who want to understand and study the Nuclear Age. He explained 10,000 square feet of the space would be used by DRI for laboratory and office space, primarily to support the archeological work at the test site.

Dr. Wells explained DRI is seeking legislative approval to sell a 20-year revenue bond, worth about $8.4 million, which will be paid in total through a guaranteed lease agreement with the DOE. He said that as a result, three quarters of the building will be paid for by federal funds. Dr. Wells stated the remainder of the funds, $2.5 million, will be used to complete DRI’s research space and is being requested from the Legislature.

Dr. Wells said he appreciates any assistance the state can provide as DRI works to develop the second phase of the master plan in southern Nevada and to capitalize on this unique partnership with DOE.

Senator Raggio inquired where the revenue would come from for the debt service on the revenue bond. Dr. Wells replied this will be from a 29-year lease through the DOE.

James Richardson, Lobbyist, Nevada Faculty Alliance (NFA), provided a handout of his testimony (Exhibit K). He emphasized the third item acknowledging the faculty awareness of the positive things in the Executive Budget. He called particular attention to the Millennium Scholarship Plan of Governor Guinn’s. He said this could do more to change the way Nevada’s high school students think about going to college than anything else the state could do.

Dr. Richardson expressed appreciation on behalf of faculty members on the recommendation to bail out the state health plan. He said he would defer details until there is time for more thorough discussion.

Dr. Richardson said the Governor’s budget continues the pattern of recommending a large share of available capital improvement funds for helping UCCSN deal with immense enrollment growth. He added there is a need to extend the list of much-needed projects if additional funding becomes available.

Dr. Richardson acknowledged the effort to continue the base budget items. He recommended the committee consider the need for a new funding study. He supported Dr. Jarvis’ remarks about the need for everyone to be involved in a very thorough study. He said the last study has meant a great deal to higher education in the state.

Dr. Richardson urged the committee to define the adjustments that had to be made in the budget as temporary fixes, to be done away with as soon as feasible. He stressed this is crucial for the enrollment issue, "otherwise we will be making permanent a high rate of courses taught by part-time faculty." Dr. Richardson stated this flies in the face of recommendations in the earlier funding study, which recommended a goal of no more than 30 percent of all courses at the community colleges be taught by part-time faculty.

Dr. Richardson emphasized NFA strongly supports the system’s request for more flexibility for UCCSN institutions in dealing with this biennium’s special problems brought on by high growth and less-than-full funding. This would allow the use of funds where they are needed the most at a given institution. He said NFA agrees that full accountability to the Legislature for those decisions should be part of any grant of more flexibility.

Dr. Richardson stressed NFA supports Governor Guinn’s recommendation that the "first fruits" of any revised estimate of available funds go toward a COLA for state employees. But if enough funding is not available to do all the things the Governor recommends, NFA suggests a statute be written, similar to the one in 1989 dealing with class-size reduction, to help deal with the unfunded enrollment. This was a "trigger statute" that said if more revenues than anticipated became available, additional funding should be spent on class-size reduction. Dr. Richardson said a statute could be written to assist with the unfunded enrollment growth. This would show that taking care of unfunded enrollment growth in higher education was indeed a very high priority and would allow a headstart on catching up should the trigger "go off." Dr. Richardson pointed out that if this should happen, most of the funds would go to the southern part of the state since this is where the majority of the growth is occurring.

Senator Coffin questioned Dr. Harter and Dr. Crowley regarding the vision for their respective campuses. Since it was necessary for Dr. Harter to leave to attend another meeting, the senator asked Dr. Scaduto, sitting in the audience, to relay his question to her. He inquired why Dr. Harter feels UNLV needs to be brought up to a research-level institution, which he said would be at the cost of an undergraduate emphasis. He said the undergraduate level is desperately needed in the Las Vegas community, and this is forcing discussion of a new four-year institution in southern Nevada.

Senator Coffin inquired about the proposed Redfield Campus in south Reno. He said new campuses might drain funds from the existing campus, which deserves continued support, particularly in the operating and maintenance areas. He asked how the idea of new campuses "coincides" with the state’s lack of resources.

Dr. Crowley answered UNR is not interested in having the Redfield Campus at the expense of the existing campus. He said that in his opinion, the university is simply proposing something that would have to be done anyway. He indicated UNR must reach the citizenry in south Reno and service the high-tech, lifelong learning, and specialized technology needs of this large and rapidly growing area of commercial and manufacturing businesses that will be located in the South Meadows. Dr. Crowley said accessibility to the main campus is going to be increasingly difficult in the future because the community has not been able to find a way to ease the traffic flow on Highway 395. He stressed the university has to be where the population is because convenience is the primary issue. He said the university could demonstrate, if called upon to do a hard analysis, savings to the state in delivering education with collaboration of the three institutions.

Dr. Crowley emphasized the university is on record as being committed to the development of the Redfield Campus on the basis of public-private funding partnerships for construction. He said that in his opinion, this is the way to go to serve the 200,000 population expected in that area. He stated this would not be a new campus for the university.

Ms. Giunchigliani said it appears excess student enrollment funds collected in FY 1998 were to be used for instructors, but they were not; they were used for noninstructional faculty. She asked for a breakout from each of the UCCSN campuses on what those funds were actually used for. She requested a listing of the number of credit hours taught by each faculty in the categories of professor, assistant professor, and so on. Ms Giunchigliani asked for the student-to-faculty ratios by campuses. She asked for the numbers in the funding formulas at the community colleges and the universities.

Ms. Giunchigliani pointed out, from the university’s documentation, COLAs were administered differently than all other state administration agencies. She requested the joint subcommittee on higher education discuss this and find out how this was provided and if a policy needs to be put in place. She asked that Dr. Harter let her know what the impact of the proposed Henderson campus would be.

Senator Neal stressed that some members of the Senate Committee on Finance might not be able to ask in-depth questions because they are not on the higher education subcommittee.

Senator Raggio adjourned the meeting at 11:30 a.m. He called the meeting back to order at 1:40 p.m.

Mental Health/Mental Retardation Division - Overview

Carlos Brandenburg, Administrator, Mental Hygiene and Mental Retardation Division (MH/MR), gave a review of the division (Exhibit L). He said the purpose of the division is to develop and operate programs that assist individuals with mental illness and mental retardation to have lives that are as independent and productive as possible.

Dr. Brandenburg explained the organizational chart shown on page 2 of Exhibit L and the distribution of costs shown on page 3. He said page 4 of Exhibit L gives a tabulation of exactly how much each of the mental health agencies receives in funding. Dr. Brandenburg pointed out page 5 of Exhibit L shows the funding for the mental retardation agencies.

Dr. Brandenburg said the mental health agencies consist of four separate budget accounts. He stated that services for adult mental health in southern Nevada are provided at four sites, shown on page 6 of Exhibit L. He said services at these four sites include outpatient services, case management, medication clinic, and pharmacy services. He recalled that Southern Nevada Adult Mental Health Services (SNAMHS) received a $4.5 million increase in general funds last session to be able to order and prescribe the new and safer medications. He said that at that time the agency basically projected the prescription of the selected serotonin reuptake inhibitors (SSRIs) to be at an 81 percent level and the atypical medications, which are the newer and safer anti-psychotic medications, at a 47 percent level. He said the prescriptions are actually at a 62 percent level for the SSRIs and a 68 percent level for the atypical medications, an increase of 21 percent.

Dr. Brandenburg pointed out that other services provided at the West Charleston location are the residential treatment programs and housing. He said there is also a collaborative effort between MH/MR and the Bureau of Vocational Rehabilitation. This provides assistance to the clients in seeking employment. Dr. Brandenburg called attention to the psychiatric emergency service located exclusively at West Charleston. He explained the ambulatory service provides intake evaluation and referrals for any individuals presenting themselves to this program. He said there are currently between 500 and 600 individuals seeking these services. He stated another service is a 10-bed observation unit, which is a residual program that provides services for up to 72 hours. He mentioned that for FY 1998 there has been an average daily census of seven individuals in this program. These two programs are available 24 hours a day, 7 days a week.

Dr. Brandenburg stated West Charleston is also the site of the acute psychiatric hospital. He said the 86-bed hospital has successfully maintained certification by the federal Health Care Finance Administration (HCFA). Dr. Brandenburg noted the average daily census for FY 1998 was 65 beds, the average length of stay was 23 days, the average admission was 82 individuals a month, and the average discharge was 82 individuals a month.

Dr. Brandenburg updated the committee on the programs funded last legislative session. He began with the intensive case management that began serving clients in Las Vegas in December 1997. He explained this service is very similar to the existing case management services except the ratio is 1:15 compared to 1:35. The  other major difference is the service is provided to those clients having a history of involvement with the criminal justice system and needing more intensive monitoring, assistance, supervision, and coordination. Dr. Brandenburg pointed out the primary performance indicators for this program are reduction of clients’ involvement with the criminal justice system and decrease in hospitalizations. He told the committee that in future meetings he would provide data showing that hospitalizations and involvement with the criminal justice system have been decreased.

Continuing, Dr. Brandenburg said another new program is a 16-bed residential program that was scheduled to begin in October 1998 but is being phased in beginning in March 1999. He said this program is for clients who no longer meet the inpatient criteria, but have a need for structure, supervision, and preparation for transitional independent living. Dr. Brandenburg pointed out that one thing noticed in the past was the high recidivism rate of clients leaving the hospital and being readmitted. He explained these services are contracted with independent providers in both the northern and the southern parts of the state.

Dr. Brandenburg said another new program, located in North Las Vegas, was a program called the Program for Assertive Community Treatment (PACT). He stated this program began in March 1998 and its sole emphasis is to reduce hospitalization. He said the PACT system is an intensive self-contained treatment team consisting of six full-time and two part-time staff members, each carrying a caseload of 12 clients. He stated the PACT program has decreased admissions to the psychiatric observation unit by 67 percent and the admission rate to the hospital by 62 percent. Dr. Brandenburg noted 58 percent of the clients are now in a less restrictive environment. Four clients, who had previous hospitalization stays of from 6 to 18 months, have not been re-hospitalized since the PACT program began. Dr. Brandenburg said more detail will be provided in the joint subcommittee hearings.

Dr. Brandenburg pointed out he has provided a study on the newer and safer medications (Exhibit M). He said the study was conducted with clients who were receiving the older medications and using the same clients after they received the new medications. He emphasized the data is very compelling. He said it shows a tremendous decrease in inpatient treatment. Dr. Brandenburg maintained there is an actual decrease in cost with the newer and safer medications. He added there is an increase in costs in outpatient treatment because now, the patients’ quality of life has improved. Dr. Brandenburg said these patients are taking advantage of outpatient services such as housing, outpatient counseling, and medication compliance. Now, they are more likely to adhere to the medication.

Dr. Brandenburg discussed the Senior Mental Health Outreach Program in North Las Vegas. He said this program developed as a result of a partnership between MH/MR, the Aging Services Division and the Bureau of Alcohol and Drug Abuse (BADA). The program was started with a grant of $110,000 from Aging Services and $22,000 from BADA. The program provides intake, evaluation, counseling and case management for patients 60 years of age and older. Dr. Brandenburg stated more data would be provided during joint subcommittee hearings.

Nevada Mental Health Institute – Budget Page MH/MR-5 (Volume 2)

Budget Account 101-3162

Dr. Brandenburg pointed out this budget has a total of $16.6 million and 218 positions. He said all services are provided at one primary location, and the services are the same as those provided in Las Vegas. He noted the hospital at the institute is licensed for 74 beds, is accredited by the Joint Commission on Accreditation of Healthcare Organizations (JCAHO), and is certified by HCFA.

Dr. Brandenburg provided several average daily census figures. For FY 1998 the average census was 52, which is exactly what the hospital is staffed for. Dr. Brandenburg said the average length of stay is 13 days, the average monthly admissions 122, and the average monthly discharge 121. He pointed out there are more admissions and discharges at the institute than in southern Nevada.

Dr. Brandenburg said the new program, first funded in the last biennium, is for an eight-bed residential program. He stated the program began on August 15, 1998, and at present all beds are occupied. He pointed out data is currently being collected to reflect the effectiveness of the program.

Dr. Brandenburg noted the PACT program started July 1, 1998, and currently has a caseload of 25 clients. He said the other program was the $2.5 million increase received to implement the medication formulary. He pointed out that similar to the situation at the SNAMHS in Las Vegas, the SSRIs are being prescribed at a lower rate and the atypicals at a higher rate.

Dr. Brandenburg reviewed some of the CIPs funded at the institute during the last legislative session. He said funds were received to construct a new 90-bed hospital and the design and development phase of the project has been completed. He explained that due to the budget shortfall, this project has been placed on the FY 2000-2001 CIP list. Dr. Brandenburg said he has been assured the project will be expedited shortly after it is approved. He said this should result in a delay of only 4 to 5 months in starting the hospital.

Continuing, Dr. Brandenburg said another project, for $140,000, was the renovation of Building 7 so it can be used as a psychiatric emergency services (PES) unit. He said the project should be completed by July 1, 1999.

Dr. Brandenburg said the last CIP was the renovation of the two current psychiatric inpatient units at $130,000. He reported one side, 8 North, was completed on December 1, 1998, and the other side, 8 South, will be completed by February 5, 1999.

Dr. Brandenburg said that in partnership with Project Restart, a homeless outreach project in Reno, Building 7 has been rented out as a 40-bed homeless unit for mentally ill women. He pointed out the program is funded by the United Way and the fee to that organization is basically "at cost."

Facility for the Mental Offender – Budget Page MH/MR-11 (Volume 2)

Budget Account 101-3645

Dr. Brandenburg noted Lake’s Crossing Center has a budget of $4.5 million with 76 positions. He said this is the maximum-security forensic facility and the only program providing services on a statewide basis. Clients referred to this facility are incompetent to stand trial and either need an evaluation of competency or restoration of their competency to stand trial. Dr. Brandenburg stated total admission in FY 1998 was 152 clients. He said 24 percent came from Washoe County, 39 percent from Clark County, and 38 percent from rural Nevada. He stressed that 77 percent of all admissions are felony-related offenses.

Dr. Brandenburg said a partnership has been developed with Lake’s Crossing and the Clark County and Las Vegas jails. He stated Lake’s Crossing is currently evaluating and treating the mentally ill from these jails. He pointed out 732 inmates from Clark County and 217 from Las Vegas are being seen on a monthly basis. Dr. Brandenburg said this allows for triage of inmates in the criminal justice system in Clark County, gets them stabilized, and assures they are in the appropriate aftercare programs.

Dr. Brandenburg pointed out Lake’s Crossing is currently undergoing a $3.2 million improvement. He said it was scheduled to be completed in July 1998 but will not be completed until June 1999. He further stated the expansion should enable forensic services to continue at Lake’s Crossing for the next two to three biennia, eliminating the need to build an additional forensic facility in Clark County at this time.

Dr. Brandenburg discussed the funding from the last legislative session, which allowed for a partnership with Washoe County Commissioners. This provided for the state to hire a half-time psychologist and the county to hire a half-time psychologist with the hopes of expediting competency evaluations at the Washoe County jail. Dr. Brandenburg explained the psychologist was hired on October 5, 1998, and the plan is to provide preliminary data at future hearings.

HR, Rural Clinics – Budget Page MH/MR-15 (Volume 2)

Budget Account 101-3648

Dr. Brandenburg said this budget is funded at $6.3 million and provides for a staff of 103. He explained this agency provides mental health services to adults and children living in 16 of the 17 counties in Nevada. Dr. Brandenburg referred to page 6 of Exhibit L showing a list of all the mental health clinics in rural Nevada. Dr. Brandenburg pointed out for FY 1998, 75 percent of those served were adults and 25 percent were children. This is the only service MH/MR provides solely for children in rural Nevada.

Dr. Brandenburg said two new clinics were funded last legislative session, one that opened in Mesquite in March 1998 and one that opened in Pahrump in August 1998. He pointed out that funds were also provided for the completion of a rural-wide computer network for client tracking and billing. This project was completed in September 1998 and has allowed the centralization of the billing functions of rural clinics.

Ms. Giunchigliani asked whether there is no longer a need for a forensic facility in Las Vegas. Dr. Brandenburg replied that with the addition of 12 beds, the need to build a facility would be postponed. Ms. Giunchigliani inquired when the screenings in the jails in Clark County and Washoe County began. She said her concern is there may be more individuals who are mentally ill in the prisons and their needs are not being served. Dr. Brandenburg responded the partnership with Clark County was begun eight or nine years ago and with the City of Las Vegas, five years ago. Ms. Giunchigliani queried whether there is anything done at the prisons other than what occurs through the psychologists. Dr. Brandenburg answered no.

HR, MH/MR Administration – Budget Page MH/MR-1 (Volume 2)

Budget Account 101-3168

Michael Torvinen, Administrative Services Officer IV, Mental Hygiene and Mental Retardation Division, Department of Human Resources, gave an overview of the proposed budget. He said this budget encompasses a staff of 12. He pointed out the only changes in the budget have been the elimination of the funding for the residency program at Nevada Mental Health Institute, as well as a position which has stood vacant for a while.

Ms. Evans asked about the deleted changes. Mr. Torvinen answered the elimination of the residency program came about because it was thought there might be some funding at the UNR School of Medicine to continue the program. He said the program has not been operating at capacity this fiscal year and the reversion targets were met for FY 1999 by not spending some of the funds because there were not as many residents in the program. Mr. Torvinen said the other change was the elimination of an Accountant Technician position in the central office. He said there were a lot of reasons the position was not filled and due to the length of the vacancy, it was eliminated.

Ms. Evans questioned whether removing all of the funding for the residency program eliminates the entire program. Mr. Torvinen said, "Not necessarily." He said there is still the possibility there is some funding at the medical school. Ms. Evans inquired whether funding was placed in the medical school budget for this purpose. Mr. Torvinen responded that he did not know.

Don Hataway, Deputy Director, Budget Division, Department of Administration, answered that as far as he was aware, no funds were added to the medical school budget for this purpose. Ms. Evans asked whether the university agreed this program should be eliminated. Mr. Hataway said it was a matter of priorities in terms of the other needs of MH/MR. He maintained the funds could be used to assist in other areas of the operation; it was not that the program was not good, it was just a matter of priorities. Ms. Evans questioned again whether the university was involved in the decision. Mr. Hataway said he was not involved in that process but he would see if the university had been.

Senator Raggio inquired the amount of funding involved. Mr. Torvinen replied it was $175,000 a year.

Mr. Dini noted the position of Clinic Program Manager was removed from the rural Nevada mental retardation budget and placed in the administration budget. Mr. Torvinen explained this position is housed in the office in Carson City and the scope of duties for that position is statewide, so it seemed more appropriate for it to be placed in this budget. Mr. Dini stressed he wanted to make sure the rural areas were served. Mr. Torvinen said the effort can be better focused this way.

Mr. Torvinen explained the additional funding for program budgets is in the maintenance decision units for a total of $8.93 million for the biennium. He said $4.6 million of that amount is for medications. He emphasized the division has been tracking caseloads and utilization of those medications since the program began last biennium. He said in that in southern Nevada the caseloads are running higher than projected and in northern Nevada they are below projections. He stated the medication utilization is almost identical in north and south. Mr. Torvinen further stated the division had anticipated that of the people on atypical antipsychotics, 47 percent would be receiving the new medications. However, approximately 67 percent are receiving the new medications. Mr. Torvinen explained the atypical medications are the most expensive.

In conclusion, Mr. Torvinen said the rest of the funding in the mental health budgets, consisting primarily of about $920,000 in enhancements over the biennium, is mostly to replace equipment. He stated $80,000 has been given to fund Peace Officer Standards and Training (POST) for security guards under legislation passed last legislative session. He said a request of $68,500 has been supported in the Governor’s budget for maintenance at the Nevada Mental Health Institute. Mr. Torvinen explained the division hopes to distribute this over both years of the biennium to try to establish a maintenance program for the campus. He said this would be a first step toward bringing the condition of the buildings to a decent level of repair.

Ms. Giunchiglianai stated she has tried to determine whether or not youths are being misplaced in programs for the emotionally disturbed in the schools rather than being diagnosed as potentially mentally ill. She queried whether in subcommittee the committee members can discuss the possibility of developing partnerships or screenings to do a better job of placing youths. Ms. Giunchigliani said some youths may need medication and are not being properly served in special education programs.

Dr. Brandenburg answered he would be glad to work with Ms. Giunchigliani and the subcommittee on this issue.

HR, MH/MR Home Care – Budget Page MH/MR-42 (Volume 2)

Budget Account 101-3166

Dave Luke, Associate Administrator for Mental Retardation, Mental Hygiene and Mental Retardation Division, Department of Human Resources, explained mental retardation is a condition that is developmental and affects the person’s ability to function. He said there are two main issues in this budget. One is waiting lists and the second, persons with conditions related to mental retardation.

Dr. Luke referred to page 7 of Exhibit L. He said there are four programs in the division that relate to mental retardation. The corresponding budget accounts consist of three regional budgets and the one centrally administered budget, for the Family Preservation Program. Dr. Luke stated the family program may be one of the most cost-effective programs operated by the state. He said individuals, based on income level, receive up to $320 per month if they maintain a mentally retarded family member in their own home. He pointed out that during the last legislative session, coverage of this program was extended to people with severe mental retardation. Dr. Luke reported there are today 210 individuals receiving this support. He pointed out that to place them in a facility would cost the state 20 times as much as it does to pay the families the $320 a month to maintain them at home.

Dr. Luke reiterated one main issue in this budget is the waiting list (caused by population growth). He explained all of mental retardation issues are addressed in the respective mental retardation budgets in a similar fashion. He provided Exhibit N, which shows the performance indicator "tracking of historical caseloads." He noted the current status of waiting lists is shown for each of the services. He said since this is a phase-in program, and even though people are currently on waiting lists, there is still funding provided that "continues to bring people into service." He stated decision unit M-200 would address additional waiting lists over the next two years and would provide case management to all prospective candidates. Dr. Luke said this would allow 880 more clients to be served than were served by the end of FY 1998.

Dr. Luke explained that in addition to case management (now called service coordination), for every individual and family, funding is being provided for 25 percent of the other services the clients might need. This could include family support, which consists of respite care, funding for jobs, and day training for adults so they can get a competitive job or supportive type of work setting such as the Community Training Center. Dr. Luke said there would be funding for 25 percent of the anticipated residential need. He said the strategy is to provide all the less costly, less restrictive services, so that there is not a need to provide residential support and impose the cost and discomfort of removing people from their homes if they do not want to be moved.

Senator Raggio asked about the waiting lists at Southern Nevada Mental Retardation Services. Dr. Luke said page 2 of Exhibit N reflects statistics for the southern region. He said that for service coordination, currently 187 individuals are being processed to determine the individuals’ eligibility and enroll them in services. Dr. Luke said 34 people are waiting for day-training placement and 69 are waiting for assistance in finding a competitive-job placement. He noted 113 individuals are waiting for residential placement; of these, 52 are waiting for intermediate care for persons with mental retardation and 61 are waiting for placement in a group home or apartment.

Senator Raggio inquired whether the numbers indicate, in the same way, what was described in regard to northern Nevada and the rural areas. Dr. Luke replied they do.

Mr. Beers asked how long the next person would have to wait, in each of the categories. Dr. Luke responded this information can be provided. Senator Raggio requested this information be provided prior to the next hearing on this budget.

Dr. Luke indicated that on the service coordination, the budget presented would serve all current and anticipated clients, so there would be no waiting beyond what is necessary to provide assessments and qualify individuals.

Dr. Luke pointed out the second major issue in mental retardation is that of serving individuals with conditions related to mental retardation. He said some of these might be epilepsy, cerebral palsy, autism, and other birth defects that have the same effect of impairing the person’s ability to function as mental retardation has. Dr. Luke stressed that in the past, the MH/MR Division has not served this group. He said in January 1998 there was a federal decision that mandated it was the states’ obligation, as part of the Medicaid program, to serve not only persons with mental retardation but also those with related conditions. He reported that currently 41 individuals are being served.

Dr. Luke explained that a survey of several Western states was conducted to determine what impact this might have on the budgets. He said Oregon and Wyoming reported they found 8 percent more clients requiring services. He explained the requested budget phases in services to an additional 8 percent of those needing these services over the course of the next biennium.

Senator Raggio stated the budget subcommittee has information showing California and Wyoming were experiencing an increase of about 18 percent and Idaho and Oregon, 8 percent. Dr. Luke explained the division took the lowest number to start with and will not truly know what the numbers will be until they begin serving this population. He said this category has been budgeted separately this time and the intent is to have the funding incorporated into the programs by the next legislative session.

Senator Raggio said that equates to 188 clients—136 in southern Nevada, 35 in northern Nevada and 17 in rural Nevada—who are categorized as having related conditions. Dr. Brandenburg agreed with these numbers. He said that basically the reason for choosing the 8 percent and 4 percent, respectively, in each year of the biennium is to allow a baseline to develop. He suggested a letter of intent, allowing this particular issue to be tracked, because there is no history in regard to related conditions. He said this is why this request was separated from the other budgets. He referred to page 8 of Exhibit L, which shows the actual definition for conditions related to mental retardation.

Senator Raggio asked whether the facilities needed for this added responsibility are provided for in this budget. Dr. Luke replied this budget provides for all sorts of services, as appropriate, for the 188 cases.

Senator Raggio reviewed the requested positions in the budget: 3.75 positions for Northern Nevada Mental Retardation Services, 21.5 positions for Southern Nevada Mental Retardation Services and 3.5 for rural centers. He asked whether this is correct. Dr. Brandenburg responded yes and pointed out some portion of this request relates to caseload growth as well as related conditions.

Mr. Beers asked whether the MH/MR Division has begun identifying persons who fall into this category and if so, how many have been identified. Dr. Luke answered that currently there are 41 being served in the category of mental retardation-related conditions. Dr. Brandenburg called attention to the fact there was no funding for "related condition" at the last session, but because of the lawsuit, some funds allocated for demographics were used to start providing services to those clients.

Dr. Luke continued there is a decision unit to provide sprinklers for some community group homes in southern Nevada to comply with requirements of the Bureau of Licensure and Certification. He stated these are the major issues for the mental retardation budgets.

Dr. Brandenburg said he personally placed the emphasis on mental retardation this time to try to reduce the waiting list and serve "related conditions." He stressed he felt this was the number one priority for the division this legislative session.

Ms. Giunchigliani asked how someone who wants to participate in respite care "gets into the process." Dr. Luke answered the intake worker at any of the regional centers can provide direction on how to become involved.

Dr. Brandenburg added that a great deal of information has been sent into the local communities and the division has been working with teachers in the school districts to inform them of this service.

Joseph P. Tyler, President, National Alliance for the Mentally Ill (NAMI), said he is also the producer of a television show called "Erasing the Stigma." Mr. Tyler added he is also a veteran who is a representative of the Veterans Integrated Service Network No. 21, which encompasses northern California and northern Nevada. He said most of all he is a consumer of mental health services, having been diagnosed with schizophrenia at the age of 28. He stated he has been hospitalized seven times for his brain disorder. Mr. Tyler said that with the care of the Veterans Administration system and the Nevada Mental Health Institute, he has had a place to turn for support. He stressed that after seven years on the new atypical antipsychotic medications, he is able to contribute back to the system that has helped him. He said that with this investment of medication and therapy, a life once lost can be found and can grow to reach its full capacity

Mr. Tyler pointed out he has produced 65 television shows on brain disorders. He said he recently sought a private sector grant to implement a program called Companion Peers of Northern Nevada, which proposes the utilization of volunteers to" link up with" the mentally ill to stop the loneliness and isolation brought on by a brain disorder.

Senator Raggio acknowledged Mr. Tyler as a good example of the kind of activism that has been helpful to all of these programs.

Anna Uptergrove, Vice President, NAMI, and President, Eagle Valley Alliance, discussed the homeless who are mentally ill. She said these individuals are forgotten due to fear from the general public. She pointed out that those with aggressive and assaultive personalities, compounded with lack of proper medication, can become dangerous. Ms. Uptergrove maintained that if the needs these individuals have for medication and community treatment are met, this large problem can be controlled. She said many mentally ill persons in Carson City are sleeping wherever they can, even in storage sheds, which have no heat, ventilation, or bathroom facilities. Ms. Uptergrove said budgets are important, but inalienable rights for human beings should be a first priority.

Ms. Uptergrove played a tape cassette recording of one of the Alliance members, who whishes to remain anonymous, describing his life of living in a storage shed for several months. She said that in consultation with several senators, a solution for this problem was determined to be the vacant houses at the Stewart Indian reservation. She stated this would be an ideal place for mental health housing for the homeless. She expressed the hope some funds could be made available to get a program started at Stewart.

David Ward, Commissioner, Commission on Mental Health and Mental Retardation, reported two resolutions were passed unanimously at the last commission meeting (Exhibit O). He said these resolutions have been mailed to all legislators and the Governor.

Christine Bitonti, Commissioner, Commission on Mental Health and Mental Retardation, said that as a clinical social worker with a medical agency, she has had the opportunity to see the impact of some of the various programs on her clients. She stressed it has made a considerable difference. Ms. Bitonti noted the progress made during the 1997 legislative session was remarkable.

Ms. Bitonti read the first resolution (Exhibit O). She said the commission is very concerned the funding for the psychiatric emergency services is not in the budget. She stated great strides have been made in the state to create a full continuum of mental health care. She maintained emergency psychiatric services are a critical piece that is missing in the northern part of the state. Ms. Bitonti pointed to the success of these services in southern Nevada. She said this is an 80-bed facility with 70 to 80 admissions a month compared to a 52-bed facility with 120 to 125 admissions a month in the north, with some individuals staying only 2 to 3 days. She stressed this requires all of the paperwork that would be required for a client staying 2 to 3 weeks.

Ms. Bitonti said this places a tremendous burden on staff in the inpatient unit, as well as on some of the other programs. She explained that some staff in other areas are doing crisis work which could be done by a psychiatric emergency service. She said a facility is currently being made ready for that service and staffing is desperately needed. She urged that a way be found to begin developing the program, even if it cannot be fully funded at this time. Ms. Bitonti maintained this is critical for the institute, to relieve the burden on other programs and allow the program to function at maximum efficiency. She said if there are no other options when clients come in, the clients are going to be hospitalized and 42 percent do not need to be. She emphasized this is the highest-cost service.

Mr. Ward addressed the second resolution (Exhibit O). He said it has to do with recommendations shown on pages 2 and 3 of Exhibit O, brought to the committee by volunteer organizations from around the community.

Dee Dee Foremaster representing the Center for Independent Living, stated she is still having problems with the Supportive Living Arrangement (SLA) and Shelter Plus programs. She asked her client, Larry Templeton, to speak. Mr. Templeton gave an account of his problems following the placement of his employer in a nursing home. He had been taking care of this individual in his home. He was given only three days to find a place for himself and his daughter. He said he rented an apartment in July 1998 and some time thereafter was diagnosed as bipolar. Mr. Templeton stated he had a severe reaction to the medication, causing him to have a very bad depression that he has been unable to overcome. He has not been able to return to work and is trying to survive on welfare.

Mr. Templeton said he needs some help at this time, while he is waiting for his case to be expedited by Vocational Rehabilitation and he gets his business started again. He said his resources have been drained and rent will soon be due.

Ms. Foremaster pointed out this is a perfect example of why the SLA and Shelter Plus Programs need to be utilized. She said some problems have been eliminated, but the major problem is that nobody knows Shelter Plus and the SLA program exist; therefore, they are not being used, especially in the rural areas. She stressed there are over 50 mentally ill people living on the river in Elko. She said she personally knows 20 homeless individuals living on the streets.

Ms. Foremaster shared a story of a young man who lived in an apartment complex until he had a breakdown. She said he was diagnosed through MH/MR and they knew he was homeless and on the streets. They did not tell him about either program. Ms. Foremaster stated that finally, 3 months later, after she had insisted, they got him off the streets. She insisted there was no reason for this. She explained the funds are available and should be utilized. Ms. Foremaster urged the funding be taken from the MH/MR Division and given to a nonprofit organization that can manage it properly and assist individuals in getting off the streets and into housing.

HR, Aging Older Americans Act – Budget Page AGING-1 (Volume 2)

Budget Account 101-3151

Carla Sloan, Administrator, Aging Services Division, Department of Human Resources, explained the division’s programs and responsibilities as related to the 1999-2001 Executive Budget (Exhibit P). She said the agency’s scope of responsibility for the provision of direct services to Nevada citizens will increase significantly with the transfer of the Elder Protective Services and Homemaker Services programs effective July 1, 1999. She reviewed the three budget accounts shown on pages 2 through 8 of Exhibit P, as detailed in The Executive Budget. Ms. Sloan stated page 11 of Exhibit P summarizes the mission statement, goals and related functional activities of the division.

Senator Raggio asked for clarification on the Senior Ride Program. He said apparently it will only exist if there is sufficient funding in the Taxicab Authority reserve, which by law must have a balance of at least $200,000; presently there is only a $56,000 projected balance. Joel Pinkerton, Principal Budget Analyst, Budget Division, Department of Administration, said there is enough funding in the base budget to make the transfer during the first year. However in order to build the reserve in the Taxicab Authority fund above $200,000, the division would have to go into enhancement categories. He said this enhancement E-126 will add to what is remaining in the base, and would fund the Senior Ride Program at the existing level.

Senator Raggio noted that three programs, the Retired Senior Volunteer Program (RSVP), Senior Companion Program and Foster Grandparents Program, are not recommended for continued funding. He further noted that on the summary, however, the Foster Grandparent Program is recommended for funding at $92,400 a year. Senator Raggio said this is about half of what was previously funded. He asked why this funding is being reduced. Ms. Sloan answered the amount shown in the budget is the amount that has been in the base budget for many years. She explained funding is split between the Foster Grandparent Program in northern Nevada and the one in southern Nevada.

Ms. Sloan said there is also an $18,000 appropriation for RSVP that operates out of Reno. She said this is in the base budget for both years of the biennium. She explained that during the 1997 legislative session, additional funding of $260,000 was appropriated. Ms. Sloan pointed out these funds were provided to seven programs that are for older-volunteer services. She stated this includes three Retired Senior Volunteer Programs, two Foster Grandparent Programs and two Senior Companion Programs. She said funding for these programs was to be requested as an enhancement, not as part of the base budget, and the $260,000 previously appropriated was not recommended by the Governor.

Senator Raggio questioned whether the base budget is maintained for all of the programs. Ms. Sloan responded the base budget funding is earmarked for the two Foster Grandparent Programs and one RSVP. She said the awards were initially made as a match for federal grants for the three programs and matching funds are no longer required. She said good use is made of the funding the programs receive.

Mrs. Cegavske asked whether the bus system for services for the elderly in Las Vegas is included. She thanked Ms. Sloan for assisting one of her constituents. She said there had been some modification to the system, where seniors were put through a test as to whether or not they qualified to continue to receive services. Mrs. Cegavske asked whether this service would continue.

Ms. Sloan answered that the Citizens Area Transit (CAT) in Las Vegas receives funding through a variety of sources, but the Aging Services Division has never contributed to funding for CAT. She explained the transportation funds the agency awards in grants are awarded on the basis of a fixed fee for rides. She said this equates to about $1.50 a ride and is contributed typically to a senior center that would be transporting seniors to and from the facility.

Ms. Sloan said the division does provide a great deal of assistance to individuals in accessing transportation. She reported a major change occurred in certification in ridership for paratransit through CAT. Ms. Sloan said that in the beginning, persons 65 years of age and older were allowed to ride without a medical certification. She explained that capacity constraints no longer allow the system to do that, so seniors without a certification can ride the fixed routes, but they could not be eligible for the "curb-to-curb" service. She said this is where the Senior Ride Program is so important to seniors, because a taxi can come to their home. Ms. Sloan explained that for a $10 purchase, seniors are given a coupon book which will give them rides valued at $20. She said this extends access to transportation.

Mrs. Cegavske asked for clarification whether "the Homemakers" and "the Displaced Homemakers" are the same thing. Ms. Sloan replied they are not.

Mr. Beers inquired about the two new positions requested for accounting and reporting and asked whether this request is due to the growth of the program or whether instead there are new reporting requirements. Ms. Sloan answered there are some new requirements that come with some new programs. She said there have been no staff increases in fiscal services in quite some time. She called attention to the fact that reporting requirements have increased significantly over the years. Ms. Sloan pointed out the cost for these positions will be allocated among several programs, so the positions will serve more than the programs being transferred to the agency. She emphasized the current staff is unable to take on any additional tasks.

Mr. Beers asked whether some of the costs for the accounting can be billed back to the federal grants. Ms. Sloan answered some of the cost allocation will come from the federal grants. She said the division has been receiving about $445,000 from the Older Americans Act grant for administrative services and this has been increased by an additional $25,000. She reported a total of about $4 million is received from the federal government and is then allocated to local service providers.

Senator Neal asked, in reference to the Senior Ride Program, what its relationship is with the Economic Opportunity Board in Clark County. Ms. Sloan responded there is no direct relationship in regards to transportation services. She said the division does provide some funding to the board for their adult day care programs under the federal grant, but none for transportation.

Senator Raggio asked how many additional clients are anticipated in the programs in budget account 101-3146 HR, Senior Services Program over the next biennium. Ms. Sloan answered the funding would support serving 866 seniors.

Mary Liveratti, Deputy Administrator, Aging Services Division, Department of Human Resources, explained the caseloads will be increased under the Medicaid Community Home-Based Initiatives Program (CHIP). She said no growth is projected under the state-funded CHIP or the group waiver program. Ms. Liveratti stated that under the Medicaid program, the division would go from 790 clients to 866 clients per month the first year and 987 clients per month during the second year.

Ms. Evans asked about waiting lists in all of the programs. Ms. Liveratti maintained there is no waiting list under the group-care waiver and said all individuals referred can be accommodated. She said in the CHIP program there are 659 people waiting for Medicaid services and 113 individuals waiting for state-funded services. Ms. Evans noted some new spaces will become available, but "it is a long way from serving the population in need."

Ms. Liveratti explained that over the next year the division would try to target services to those who need it most so they can move to the top of the waiting list sooner.

Mrs. Chowning asked for an explanation of what it means in the performance indicators when it says "dollars saved." Ms. Liveratti replied this means dollars saved due to clients not having to go into more costly nursing home care. Mrs. Chowning said this is quite significant and expressed the desire to have every agency provide this type of information. She asked what the estimate of future savings would be with additional clients receiving services.

Ms. Sloan explained the purpose of the Medicaid waiver program is to delay institutionalization. She said the deferred savings are something this program is intended to do. She said she doubts the waiting lists can ever be eliminated.

Ms. Liveratti explained the savings. She said there are six levels of care in nursing homes and the rates paid at the different levels vary from $1,800 to $7,000 per month. She noted no one is currently at the highest level of care. Ms. Liveratti pointed out the division has a computer program that tracks every client on the program and the level of care each client receives. There is a formula that calculates what the cost would be if the client were in a nursing home. Ms. Liveratti said the services provided are subtracted out and the remainder is what is shown as cost savings. She called attention to an incorrect figure that was the agency’s error. She said that under the performance indicators shown on page 10 of the budget, in FY 2001 it should show $13.2 million, not $11.8 million.

Mr. Beers asked how long a new client has to wait to receive service. Ms. Liveratti responded that for programs in the northern part of the state, the wait is probably 90 days. She said that in Las Vegas it would most likely be 6 to 8 months. Mr. Beers said this program appears to be almost entirely federally funded. Ms. Sloan explained the Medicaid funding is matched dollar for dollar, but the state match is not in the Aging Services budget, it is in the Division of Health Care Financing and Policy budget.

Mr. Dini said that in 1997 an addition of $150,000 was provided for the rural senior centers funding. He noticed the recommendation is for it to be lowered by $100,000 for the next biennium. He asked whether the rural senior centers could survive. Ms. Sloan said funding for this program is comparable to funding for the older-volunteer programs, in that the award which was made in the last legislative session was regarded as something that would not become part of the base, but would need to be requested as an enhancement. She said that last session a 3 percent increase was awarded over the "hold harmless" and this is in the base budget and will be retained. Ms. Sloan said wonderful use was made of the $100,000 that was awarded. She explained that additional transportation and homemaker hours were provided. She stressed it was made very clear that these funds were to go for direct services, so none of the programs are using these funds for staffing or ongoing costs. Ms. Sloan said she was sure that if these programs were to receive the funds again, very good use could be made of them, but the programs were awarded the funds with the understanding the funding should be regarded as "one-shot."

Mr. Dini stated he believes the intent was for the funding to be permanent because he made the motion. He asked how many RSVP programs would be eliminated. Ms. Sloan said the only funding provided in the base budget for RSVP is for the one operating at UNR. She explained the rural RSVP program serving 15 counties, and the RSVP program conducted by Catholic Charities of Southern Nevada and Las Vegas, were not included. Mr. Dini inquired whether there is a solution to this. Ms. Sloan replied it was her understanding, after talking with the state director for the federal agency that funds these programs nationally that the matching funds in the base budget are no longer required. She suggested the matching funds of $111,000 be made available for the seven programs to compete for through the normal grant process. Ms. Sloan reiterated the programs have done "wonderful things" with their funding. She said they each do different kinds of things and it would be difficult to say which are the most valuable.

Mr. Dini said the difficulty is that the funding in the rural area is used, for instance, to provide transportation to bring individuals to Reno for doctor appointments. Ms. Sloan pointed out that even though the funds are not earmarked for transportation, the rural RSVP program and a home companion program include transportation in their services. She said the lack of transportation in the rural areas is critical. She stressed the rural RSVP Program makes a wonderful contribution.

Senator Raggio suggested that before this budget comes before the joint subcommittee an appropriate mission statement and suggested performance indicators be developed.

Senator Neal asked for elaboration on the decision to replace some of the Medicaid revenue with block grant funds. Ms. Sloan explained the program is currently being conducted out of the Division of Health Care Financing and Policy, which administers the Medicaid programs. She said some of the staff involved with the two programs were also providing Medicaid services. Ms. Sloan stated the Aging Services staff is not being asked to take on the responsibilities that the Medicaid staff performs. These duties are not part of the Elder Protective Services program or the Homemaker Services program; they are "other duties as assigned" that can be reimbursed under Medicaid. Ms. Sloan said that since the Aging Service staff are not going to be providing the services, Medicaid funds cannot be used for payment. Ms. Sloan explained the division has requested Title XX funds to replace the funds they cannot receive from Medicaid.

Senator Raggio adjourned the meeting at 4:15 p.m.

RESPECTFULLY SUBMITTED:

Patricia Hampton,

Committee Secretary

APPROVED BY:

____________________________________________

Assemblyman Morse Arberry, Jr., Chairman

DATE: