ASSEMBLY COMMITTEE ON COMMERCE

MINUTES OF THE meeting

of the

ASSEMBLY Committee on Commerce and Labor

Seventy-First Session

May 21, 2001

The Committee on Commerce and Labor was called to order at 4:13 p.m., on Monday, May 21, 2001. Chairman Joseph Dini, Jr. presided in Room 4100 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mr. Joseph Dini, Jr., Chairman

Ms. Barbara Buckley, Vice Chairman

Mr. Morse Arberry Jr.

Mr. Bob Beers

Mrs. Dawn Gibbons

Ms. Chris Giunchigliani

Mr. David Goldwater

Mr. Lynn Hettrick

Mr. David Humke

Ms. Sheila Leslie

Mr. Dennis Nolan

Mr. John Oceguera

Mr. David Parks

Mr. Richard D. Perkins

STAFF MEMBERS PRESENT:

Vance Hughey, Committee Policy Analyst

Crystal McGee, Policy Analyst

Darlene Nevin, Committee Secretary

OTHERS PRESENT:

Margi Grein, Legislative Advocate, Nevada State Contractors Board

Dennis Haney, Independent Counsel, Nevada State Contractors Board

Lawrence Semenza, Legislative Advocate, Anthony Silvan Pools

Warren Hardy, Legislative Advocate, Lifeguard Pools

Chairman Dini opened the work session on S.B. 6.

Senate Bill 6: Prohibits practice of requiring borrowers to insure improvements to real property for more than replacement value as condition of obtaining loan. (BDR 57-665)

Vance Hughey, Committee Policy Analyst, Research Division, Legislative Counsel Bureau, presented the work session document on S.B. 6 (Exhibit C). There was no testimony in opposition to S.B. 6 and no amendments had been proposed.

ASSEMBLYMAN HETTRICK MOVED TO DO PASS S.B. 6.

ASSEMBLYMAN ARBERRY SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT.

Chairman Dini opened the work session on S.B. 133.

Senate Bill 133: Authorizes board of dental examiners of Nevada to issue certain licenses without examinations or clinical demonstrations to dentists and dental hygienists licensed in other jurisdictions under certain circumstances. (BDR 54-241)

Mr. Hughey presented the work session document:

1) Senator Maggie Carlton had proposed the following technical amendments:

Change the wording in subsection 1 of Nevada Revised Statutes (NRS) 631.230 from “take an examination” to “apply.”
Change the word “chapter” to “section” in Section 3 and Section 4.

2) Janice Pine, St. Mary’s Health Network, had informed the committee that St. Mary’s mobile vans were allowed to operate not only in Washoe County, but also in the surrounding rural counties that were served by the nonprofit clinic. Tab B of Exhibit C is a memorandum from Jan K. Needham to Senator Maggie Carlton, which concluded:

As the mobile units you are referring to are operated out of Washoe or Clark County, the provisions of S.B. 133 would not, therefore, prohibit a dentist or dental hygienist who has contracted with a federally qualified health center or a nonprofit clinic to cross the county boundaries to provide services in another county.

3) Dr. Larry Champagne, Nevada Board of Dental Examiners, opposed Section 2. Section 2 required the board to issue a two-year temporary license to a dentist who had been licensed in another state for at least five years and met certain other requirements, but who had not passed the clinical demonstration as provided by NRS 631.240.

4) Maury Astley, Executive Director, Nevada Dental Association, had suggested Section 2, if it remained in the proposed legislation, be amended to provide for a temporary license for dental hygienists as Section 4 included both dentists and dental hygienists.

5) Christine Forsch, Nevada Dental Hygienists Association, suggested that if Mr. Astley’s amendment was approved, a provision should be added that required a dental hygienist to be a graduate of an accredited program. An alternative she proposed was to include in Section 2 wording similar to that from Section 4, “Is otherwise qualified for a license to practice dentistry or dental hygiene in this state.” She was concerned because some states did not require dental hygienists to graduate from approved programs.

For the record only, Maury Astley, Executive Director, Nevada Dental Association, submitted a letter to the committee (Exhibit D). Also for the record only, Cheryl Euse, Private Citizen, submitted a letter to the committee (Exhibit E).

ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO AMEND AND DO PASS S.B. 133 WITH THE TECHNICAL CHANGES ONLY.

ASSEMBLYMAN GOLDWATER SECONDED THE MOTION.

THE MOTION CARRIED WITH NINE VOTES IN FAVOR. ASSEMBLYWOMEN LESLIE AND GIBBONS WERE NOT PRESENT FOR THE VOTE. CHAIRMAN DINI VOTED AGAINST S.B. 133.

Chairman Dini opened the work session on S.B. 153.

Senate Bill 153: Provides for examinations for licensure as cosmetologist to be offered in languages other than English. (BDR 54-855)

Mr. Hughey reviewed the work session document on S.B. 153. S.B. 153 required the State Board of Cosmetology to provide examinations for licensure as a cosmetologist in Spanish upon the request of an applicant. The board could provide the examination in other languages as well if it was determined to be in the best interest of the public. The board would consider the percentage of the population that spoke the language in making its determination.

Testimony indicated non-English speaking applicants were unable to practice the profession they had practiced in other jurisdictions because of the language barrier in the exam. The contention was this resulted in their not being able to earn a higher standard of living.

No formal amendments to S.B. 153 had been received.

ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO DO PASS S.B. 153.

ASSEMBLYMAN PARKS SECONDED THE MOTION.

THE MOTION CARRIED BY THOSE PRESENT. ASSEMBLYMAN GOLDWATER ABSTAINED.

Assemblyman Goldwater disclosed one of his clients had testified.

Chairman Dini opened the work session on S.B. 320.

Senate Bill 320: Provides for external review of certain determinations made by managed care and health maintenance organizations. (BDR 57-676)

Assemblywoman Buckley explained S.B. 320 addressed external review. She informed the committee she had introduced a bill identical in content to S.B. 320 but they had “chosen different routes to achieve the same goals.” Having worked with representatives of consumers and insurers during the session, the best parts of both pieces of proposed legislation were selected. The changes were reflected in the proposed amendment to S.B. 320 (Exhibit F).

The major concern was whether the insurance company or the Office of Consumer Health Assistance would pick the external review organization. Senator O’Connell preferred that the health insurance company make the selection. However, she agreed the Office of Consumer Health Assistance could select provided there was a “back-up mechanism” in case of emergency denials. Having explored agencies that were open 24 hours per day over the weekend, Dr. Carlos Brandenburg, of Mental Health, was chosen as the “back-up.” This provision was included on page 7, paragraph 6 of the proposed amendments.

Chairman Dini asked if there were questions. There were none.

ASSEMBLYMAN HETTRICK MOVED TO AMEND AND DO PASS S.B. 320.

ASSEMBLYWOMAN GIUNCHIGLIANI SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY BY THOSE PRESENT.

Assemblywoman Buckley informed the committee she had allowed her proposed legislation that was similar to S.B. 320 to be indefinitely postponed.

Chairman Dini opened the work session on S.B. 416.

Senate Bill 416: Exempts certain persons and governmental entities from provisions governing licensure of private investigators. (BDR 54-933

Mr. Hughey reviewed the work session document for the committee. S.B. 416 exempted from the licensing requirements of Chapter 648 those often referred to as “mystery shoppers.” Senator Schneider proposed an amendment that would replace lines 31 through 33 on page 2 with the following:

(b) The information contained in the questionnaire is not used to discipline or discharge an employee of the business, business organization, or governmental entity;

Chairman Dini asked for discussion from the committee.

ASSEMBLYMAN GOLDWATER MOVED TO INDEFINITELY POSTPONE S.B. 416.

ASSEMBLYMAN BEERS SECONDED THE MOTION.

THE MOTION CARRIED BY THE MAJORITY OF THOSE PRESENT. ASSEMBLYWOMAN GIBBONS WAS NOT PRESENT FOR THE VOTE. TWO VOTED AGAINST THE MOTION.

Chairman Dini opened the work session on S.B. 216.

Senate Bill 216: Makes various changes pertaining to contractors who engage in repair, restoration, improvement or construction of residential pools and spas. (BDR 52-1037)

Margi Grein, Nevada State Contractors Board, related that S.B. 216 was proposed by Senator Care who was in committee. Senator Care had asked that the board explain the proposed changes to S.B. 216 (Exhibit G).

Dennis Haney, Nevada State Contractors Board, presented the proposed changes:

Section 2 provided the board would adopt by regulation standards for advertisements that were as stringent as those required of “used car dealers in Chapter 598.”

Section 3 had required work cards. Section 3 was entirely replaced by a new Section 3 that provided the contractor could be required to utilize the services of a construction control if he or she had violated the provisions as described.

Section 4 required the contractor to comply with all the state and local laws as well as the regulations that might be adopted by the board. Subsection 3 identified that the qualified employee or officer of the pool contractor was responsible for the supervision of the work.

Section 5 provided that a contractor could not “act as an officer, director, employee or owner of a bonding company, finance company, and so forth.” They also could not receive “remuneration” for the loan acquired for the pool. Many of the lending requirements were removed, as requested by John Sande, so there would be no limitations on the finance companies.

Assemblyman Beers was apprehensive that a contractor might be prohibited from offering financing through his pool company. Mr. Haney responded that Section 6 addressed this concern. Assemblyman Beers perceived that Section 5 prohibited the contractor from offering such financing. Mr. Haney clarified that Section 5 prohibited “kickbacks.” Section 6 permitted the financing as long as certain requirements were met. The third party’s agreement was mandatory.

Assemblyman Hettrick interpreted Section 5 “The contractor . . . shall not (1) Act as, or carry out the duties of, an officer, director, employee or owner of . . . a bonding company, finance company or any other corporation who cosigns, underwrites, obtains a deed of trust for . . .” as stipulating that the contractor could not own the company and do the financing. However, Section 6 seemed to allow the pool company to finance the pool.

Mr. Haney replied one could not own a bonding company, a financing company, or any type of corporation or business entity that underwrote deeds of trusts or made loans. Section 6 specifically allowed the pool contractor to make the loan itself.

Rereading the language of Section 5, Assemblyman Hettrick still felt it prevented an individual pool company from making the loan. Mr. Haney suggested inserting the words “except as provided in Section 6 at the beginning of Section 5, right before “A contractor . . .” Mr. Hettrick agreed.

Mr. Haney continued:

Section 7 provided that certain violations were cause for disciplinary action. Violation of NRS 597.716 or NRS 519.719 was a category D felony. He made a correction on Section 7, subsection 1. “Sections 2 to 5, inclusive . . .” should read “Sections 2 to 6, inclusive . . .”

Section 9 deleted some language. Subsection 7 was deleted as it was already in S.B. 216.

Section 10 represented Mr. Larry Semenza’s amendment. There could be no “waiver” of the mandatory elements the contractor’s board placed in contracts. Deviation from those elements would render them void and unenforceable. Subsection 2(g) provided that “the amount of any advance deposit paid or promised to be paid to the contractor by the owner,” could not exceed $1,000 or 10 percent of the aggregate contract price, whichever was less. Subsection 2(i) provided nobody could get money from one of the owners for a “change‑order” unless it was in writing and signed by the owner. The actual work and charges had to be included in the change‑order. Subsection 2(l) provided that commission payable to a sales person would be paid pro rata, not “up front.” This would guarantee the contractor had the money to do the work.

Assemblyman Beers compared the maximum “$1,000 advance deposit paid or promised to be paid” on page 5 with the language in the middle of page 6. He asked if there was a definition of “advance deposit.”

Mr. Haney replied the term “advance deposit” was not a defined term. He also clarified that if someone had put up a payment performance bond for the pool, the limitation on when they received their payments was not enforced.

Assemblyman Beers understood why the amount of deposit paid prior to the start of a project would be limited. However, he contended the wording “advance deposit paid not to exceed $1,000” could be interpreted as meaning the owner could not pay more than $1,000 until the pool was completed.

Mr. Haney replied the first payment could not exceed $1,000 or 10 percent. However, after the work started, the owner would follow the schedule of payments. Subsection 2(k) provided that the payment schedule could not provide for the contractor to receive payments in excess of 100 percent of the value of the work performed on the project at any time. This would prevent the advance payment problems provided in the original hearing of S.B. 216.

Assemblyman Beers was only concerned with the wording and suggested changing subsection 2(g) by deleting “advance” before the word “deposit” and inserting “prior to the start of construction” before “not to exceed $1,000 or 10 percent . . .”

Vance Hughey, Committee Policy Analyst, Research Division, Legislative Counsel Bureau, Research Division, asked Assemblyman Beers if he wanted to limit the change to the word “construction” as the rest of S.B. 216 also referred to “repair, restoration, improvement, or construction.” Mr. Beers replied he wanted those included.

Assemblyman Hettrick suggested a technical language change in subsection 2(k). He recommended changing “This provision shall not apply if the contractor has furnished a payment and performance bond . . .” to “This provision shall not apply if the contractor has included a payment and performance bond . . .” He felt it could be argued that the buyer was furnishing the payment bond if it was included in the price. He did not think they “furnished” it if it was included in the price.

Mr. Haney responded “provided” would be more acceptable than “furnished.” Mr. Hettrick did not feel it was “provided,” rather the buyer paid for it; it was included in the contract. Mr. Haney replied they should “give them the bond, not just charge them.”

Mr. Hettrick detected Mr. Haney was thinking about the bond actually being “handed” to the owner. Mr. Hettrick’s concern with the wording was that it reflected who purchased the bond; he wanted the wording to show that the cost of the bond was included in the price.

Mr. Haney suggested adding “and included in the price” after “for the full performance and completion of the contract.” Mr. Hettrick approved of this proposal.

Mr. Haney continued his presentation of S.B. 216.

Subsection 3 provided that the owner would initial the provisions of the contract thus indicating his or her knowledge and understanding of the provisions. Subsection 3 also stipulated that the owner could ask for or waive a bond.

Regarding NRS 624.270, Assemblyman Beers asked if the provisions governing the additional requirements on the pool contractor had been found to violate the earlier provisions. Mr. Haney responded they had.

Mr. Haney continued.

Section 10.3 provided for an ombudsman to help educate and provide answers for owners, contractors and financial institutions. The ombudsman would also notify the board if there seemed to be violations of certain sections of NRS Chapters 624 or 597.

Section 10.5 permitted the board to require a contractor to file with the board a bond, in an amount fixed by the board, before granting an original or renewal license. This would be a consumer protection bond.

Section 10.7, the background check, was deleted.

Sections 11 and 12 were deleted.

Section 13 allowed the board to have a contractors’ license bond between $1,000 and $500,000 for any contractor, not pool contractors only. It also required the bond had to be rated “A” or better.

Section 13, subsection 7, provided that a pool or spa contractor who became licensed on or after July 1, 2001, violated the provisions, had a contract that did not comply, or had five valid complaints within a 15-day period, would comply with the provisions of subsection 8.

Subsection 8 required a payment and performance bond. The bond required an “A” rating or better.

Assemblyman Humke asked about subsection 7 (d), “Has five valid complaints filed against him within any 15 day period . . .” He wondered how long it took the board to process a complaint to determine whether or not it was valid.

Mr. Haney responded the design of the provision was intended to avoid the difficult situations related in the original hearing. Typically, when one person filed a complaint, the board received numerous complaints and wanted to respond quickly. A normal complaint could take three to four months to process. It was normally assigned to an investigator who checked the job and determined whether or not the complaint was valid. If it was a workmanship issue, a notice of correction would be provided giving the contractor a specified amount of time to correct the work. Sometimes the contractor was already found making the correction and the notice would not be given. Mr. Haney pointed out there would typically not be five such instances occurring in a period of 15 days, but it depended on the number of pools they were building. It was usually a four-month process and the board would be acting quickly.

Assemblyman Humke suggested changing the language to reflect that the 15‑day period start with the day the board received the complaints. Mr. Haney responded it was not intended that the board found they were valid; the board investigator would return and report there was a problem and present a notice to correct.” He clarified that subsection 7(d) referred to 5 such “complaints” filed, not 5 notices to correct, in the 15‑day period. He added that if subsection 7(d) did not reflect that, it should be changed.

Chairman Dini asked Mr. Haney how he would make the correction. Assemblyman Humke asked if “filed” was the key word in the language. Mr. Haney replied it was and added that the complaints were in writing. Mr. Haney felt the language was adequate and no correction was necessary.

Assemblyman Humke asked affirmation of his understanding that the investigator went out and made a quick determination as to the validity. Mr. Haney agreed and clarified the validity of the complaints might not be determined in the 15 days, but the 5 complaints would have been received within the 15 days. Assemblyman Humke agreed the language as written was sufficient.

Mr. Haney continued his presentation of the proposed changes to S.B. 216.

The changes on page 11 were “cleanup” language.

Mr. Haney stated he had presented all the changes and felt all the issues raised had been addressed.

Assemblyman Beers asked Mr. Haney to explain Section 15, subsection 2, “The provisions of this chapter apply to a contractor who is required to obtain the services of a construction control pursuant to the provisions of Section 4 of this act.” Mr. Haney clarified that was added to NRS Chapter 627 to provide a cross-reference so that an individual reading Chapter 627 would know it applied to a contractor. Assemblyman Beers asked if “Section 4” referred to Section 4 of the S.B. 216 reprint Mr. Haney had just presented. Mr. Haney answered it did, and then realized Section 4 was not the correct section. The number would have to be changed.

Assemblyman Beers likened the use of construction control on the construction of a pool with “hunting for sparrows with a 357 Magnum.” He contended it would be “grotesquely expensive” for a $10,000 to $20,000 project to be run through a construction control company. He wondered under what conditions Mr. Haney could foresee the need for a construction control.

Mr. Haney responded that the cost of setting up a construction control was between $100 and $200 and the fee would be 1 percent or less, depending on the size of the project. Assemblyman Beers agreed that was sensible for a large project and also argued that he had heard of charges that differed significantly. Mr. Haney retorted his figures came directly from Nevada Construction Services, one of the major construction control services in southern Nevada. He also illuminated this would “come into play” only if someone had violated the statutes in the first place; it was a disciplinary measure. Assemblyman Beers contended the requirement could put a contractor out of business.

Mr. Haney emphasized construction control was another method of helping a construction company “stay in business and make things work.” The board tried to work with those who “really wanted to get it right.” He added it was too late to revoke the licenses of the pool companies that had already gone, but that it would have been helpful if construction control had been in place. Mr. Haney also explained that some lenders required construction control depending on how the loans were put together. Sometimes the loan was part of a bigger package and construction control would be utilized. He reiterated it was a disciplinary tool only.

Assemblyman Beers argued it was used on large projects. Mr. Haney retorted it was used for any size project. Assemblyman Beers persisted that on a project between $10,000 and $20,000, the cost of the performance bond for a contractor known to have problems performing, would be significant. He realized they disagreed upon the significance of the cost of construction control. Mr. Beers contended there was a substantial fixed cost for any construction control company to set up the initial project, and the daily processing was not nearly as intense as the setup. He claimed construction control would not accept many $10,000 projects.

Mr. Haney supplied further information he received from Nevada Construction Services. There would typically be four inspections on the construction of a pool; the money could be requested four times. More than four would increase the cost of construction control. “It was not a large effort by construction control,” he added.

Assemblyman Beers asked about construction control’s involvement with disbursements. Mr. Haney answered construction control did not deal with disbursements to specific employees, but they did deal with disbursements to both the pool contractor and the subs.

Assemblywoman Buckley voiced S.B. 216 was an excellent vehicle for the recovery fund for those victimized by pool contractors and asked Margi Grein her thoughts on an appropriate eligibility date for those funds.

Ms. Grein recommended October 1, 1999, the first day the board started collecting. She also thought the Attorney General would not approve of an earlier date. Considering the large scale of damages and numerous licenses revoked since that time, Ms. Grein felt the recovery fund would only provide “nominal” relief. She added the problems with the contractors were recurrent.

Assemblywoman Buckley felt they had legislative discretion to decide the date without waiting for the Attorney General’s opinion. Her concern was that the recovery fund not date back so early that it would bankrupt the fund. Ms. Grein affirmed for Ms. Buckley that October 1, 1999, would still be her suggested date. Ms. Buckley asked if it would help the victims of Cascade Pools.

Ms. Grein thought most of those contracts were entered into between 1999 and 2000. She clarified for Ms. Buckley the suggested time period of October 1, 1999, to the present referred to contracts entered into, not fraud occurrences. Mr. Haney responded they were not sure when some of the contracts were entered into; some were entered into in 1998. He presented Section 10, subsection 2(m) as his “best effort” to help the Cascade Pools victims. He quoted, “With respect to a contract executed before October 1, 2001, if any payment schedule set forth in the contract does not comply with the provisions of this chapter, chapter 624, (none of them did, he interjected), eliminates the obligation of the owner to make payments . . . and the lender cannot initiate foreclosure proceedings.”

Mr. Haney clarified for Assemblywoman Buckley that Section 10, subsection 2(m), though not in bold, was new. The bold type reflected the changes in the first reprint of S.B. 216. Assemblywoman Buckley said there was generally a presumption that their laws “were not retroactive.” She asked Ms. Grein if she agreed to clarifying that the recovery fund would go toward contracts entered into since October 1, 1999. Ms. Grein felt that was practical.

Assemblyman Humke asked if there was a provision that would prohibit contractors from serving as their own construction control company. According to NRS Chapter 627, explained Mr. Haney, construction control was a separate entity; contractors could not be their own construction control. There was, however, an exemption that allowed banks to disburse their own loan funds.

Mr. Humke asked if there was a penalty in NRS Chapter 627 for a contractor who functioned as “a would‑be” independently operated construction control. Mr. Haney did not know of any and offered that S.B. 216 stipulated a construction control had to be independent. He clarified for Mr. Beers that the provisions were contained in S.B. 216. Mr. Humke referred to Mr. Beers’ earlier concerns with regard to construction control fees. He speculated that legitimate construction control businesses would not want to do construction control for the poorer quality contractors for a flat fee of $250. Prices therefore would rise, and homeowners would not know what a valid price would be. Mr. Haney responded the ombudsman would be of assistance to the owner. Mr. Humke countered that he wanted to help prevent “the 15 complaints in 5 days.” Mr. Haney added the bill would not be perfect; if he could make it perfect, he would. He advised, however, it would help avoid some of the problems “we’ve been here two sessions for.”

Assemblyman Hettrick pointed out Section 5, subsection 2, mentioned renumeration rather than remuneration. He recommended that S.B. 216, with the changes, proposed was a “good bill, a step in the right direction.”

Assemblyman Beers wondered why the penalty in Section 14, subsection 2(c), for the third offense of a contractor violating contracting law, was a class E felony; yet in Section 7, subsection 2, that set of penalties was “tossed out for pool spa contractors in favor of them being guilty of a category D felony on their first violation.”

Mr. Haney informed Mr. Beers the penalties in Section 14 were for unlicensed contractors and were criminal penalties, not related to the “civil side.” He verbalized, “if you are a real bad guy and you are a fraud,” it would be a class D felony. Mr. Beers’ interpretation was that if an individual misinterpreted the statutes and made even an honest mistake, he or she would be guilty of a category D felony. Mr. Haney countered that the violation had to be established by the board after a hearing. Mr. Beers surmised, “If you make a violation, you have to use construction control, post a performance bond and you’re a felon?” Mr. Haney responded that if one violated NRS Chapters 597, 716 and 719, that was correct. The other violations were simply things the board could do such as increase the bond, require a payment performance bond, require construction control and revoke one’s license.

Chairman Dini asked if there were any further questions. He invited Mr. Semenza to testify.

Lawrence Semenza, Anthony Silvan Pools, informed the committee that he and Mr. Haney had discussed Section 4, subsection 3, and wondered if it reflected the section’s intent. It was intended that qualified and licensed employees perform the supervision. He related that qualified individuals would wrongly lend their licenses to unlicensed contractors and receive remuneration in return. He asked Mr. Haney’s response. Mr. Haney agreed and expounded that the intent was to have the qualified employee of the contractor be responsible for the supervision of the work.

Mr. Semenza referred to the change Mr. Haney and Mr. Hettrick proposed in Section 5, the addition of “except as provided in Section 6.” He believed he also heard that in subsection 2 “for the loan” was to be added after “Receive renumeration or any other thing of value.” Mr. Haney responded that he had testified to that. Mr. Semenza felt it did not read as it should. Chairman Dini said it would be corrected.

Warren Hardy, Lifeguard Pools, recalled the Class D felony was meant to apply only to those who violated the portion regarding financing; it was not intended to be “on the menu of things the contractors’ board could use to get at the bad actors.” Chairman Dini replied, “Fraud was fraud, if it was a fraudulent job . . . why shouldn’t he be penalized?” Mr. Hardy replied fraud was already a class D felony, and in his opinion there were certain aspects of being guilty under NRS, Chapter 624, that should not require a Class D felony. Mr. Haney clarified it only applied to the fraud portion.

Mr. Hardy said there were several things they had not talked about that were in the amendment and that he was pleased with some of the portions removed. He understood the committee had to act on the bill.

Chairman Dini suggested the bill be reprinted and looked at again; he wanted to be sure the bill was a “good product.” Mr. Semenza agreed. They wanted to help the public avoid the fraudulent dealers.

ASSEMBLYWOMAN BUCKLEY MOVED TO AMEND AND DO PASS S.B. 216.

ASSEMBLYMAN HUMKE SECONDED THE MOTION.

Assemblywoman Buckley clarified the amendments upon which they were voting:

the recovery fund;

the addition of “except as provided in Section 6” to Section 5;

clarification on the eligibility for the recovery fund; and

the performance bond clarification.

Ms. Buckley replied to Mr. Dini’s concern regarding “qualified employee” in Section 3. She suggested the Legislative Counsel Bureau could clarify that particular section.

THE MOTION CARRIED UNANIMOUSLY BY ALL THOSE PRESENT.

Chairman Dini thanked those who testified and closed the hearing on S.B. 216. He opened the hearing on S.B. 513.

Senate Bill 513: Makes various changes to provisions relating to investigations and proceedings for disciplinary action by regulatory bodies who regulate certain professions, occupations and businesses. (BDR 54-81)

Vance Hughey provided the committee with a memorandum (Exhibit H), which was a response to inquiries made at the original hearing of S.B. 513, by Assemblywoman Giunchigliani and Assemblywoman Buckley.

Mr. Hughey reviewed the work session document on S.B. 513 for the committee.

Assemblyman Goldwater had proposed deleting “allegedly” from lines 21, 27, 30, and 38 of page 2. However, the Legal Division suggested the current verbiage was consistent with the concept of a consent agreement as used in that section.

Assemblyman Lynn Hettrick had proposed language clarifying that “pertinent” documents would become public record. The Legal Division indicated, “It was only the documents considered by the board when determining whether to impose discipline.”

Assemblyman Hettrick explained that his request for adding “pertinent” also included striking of the word “whether” in determining to impose discipline. “If ‘whether’ were not removed, it would be open even if you hold a hearing and decide not to do anything.” He maintained that documents could be made public record even if discipline had not been imposed.

Assemblywoman Buckley expressed her concern about the fees and costs section of S.B. 513. She did not think they would want to change the process whereby regulatory agencies had to get something approved by the State Board of Examiners. Ms. Buckley contended there was an “inherent” conflict when one could assess fines that “funded their agency.” She predicted S.B. 513 would allow the assessment of “any fees and costs without even defining what the costs are.”

Chairman Dini countered that according to Mr. Hughey’s memorandum, many boards already followed that process.

Assemblyman Humke reasoned that in a lawsuit, a “neutral and detached” judge reviewed and assessed the fees and costs. Boards, however, were not neutral and detached. Board members would have an interest in what the attorney was doing to get a recovery.

Assemblywoman Giunchigliani expressed that her concerns with Sections 5 and 5.5 were due, in part, to the premise from Legislative Advocate, Kent Lauer, “that if you entered into a settlement agreement, in his interpretation, you were guilty.” If that were the “genesis” of S.B. 513, she felt it would “set up employees no matter who’s running the board.” Ms. Giunchigliani predicted passage of S.B. 513 would give boards “impetus to move forward in that direction.”

Ms. Giunchigliani also related that in regard to page 3, no one had addressed what would be done should an individual appeal. Also, Section 15, subsection 4, stated, “the board shall not administer a private reprimand.” Ms. Giunchigliani offered that sometimes a reprimand was appropriate within the confines of a licensing board. She also suggested that automatically making the offense public record could remove the motivation for that particular board to change certain behaviors that did not negatively affect the public. Ms. Giunchigliani perceived S.B. 513, even with the proposed amendments, as a “witch hunt more than anything else.”

Assemblywoman Buckley, in reference to page 3 of Exhibit H, referred to A.B. 235 of the Sixty-Seventh Session and regulatory authorities being able to recover costs from individuals disciplined. There was a two‑part method; either the case went to an independent hearings officer, or the board themselves acted. Either way, the money went to the state General Fund, after which the claim could be presented to the State Board of Examiners. In this way there would be an independent arbiter. Ms. Buckley declared that “mechanism” would not be in place with the passage of S.B. 513.

Assemblyman Humke presented that the Legislature had created opportunities for citizens to be represented in the past, such as the Nevada Attorney for Injured Workers (NAIW). He proposed that hearings officers, neutral and detached, could evaluate whether or not the fees and costs were reasonable. He did not dismiss the possibility that “churning . . . might be taking place in some of these regulatory boards.”

Mr. Hughey pointed out that although he had not gone through the bill “point by point,” the two-tiered structure that was referenced by Ms. Buckley, NRS 624.140, was not being deleted by S.B. 513. Therefore, that mechanism remained.

Assemblywoman Buckley suggested obtaining clarification from the Legal Division because Title 54 of NRS, (subject of S.B. 513), seemed to her the “master Chapter” of all boards. “Adoption of S.B. 513,” she determined, “would then supercede anything else and is general law. It would now apply to every single board.”

Chairman Dini asked if there were any amendments that could save S.B. 513. Kent Lauer, Legislative Advocate, was not available for comment. Chairman Dini proceeded with the next order of business.

Chairman Dini asked Vance Hughey to present the bills received from the Senate for concurrence or nonconcurrence.

Assembly Bill 47: Makes various changes concerning policies of industrial insurance.

Senate Amendment No. 705 (Exhibit I) was provided to the committee. There was no discussion.

ASSEMBLYMAN HUMKE MOVED TO CONCUR WITH AMENDMENT NO. 705.

ASSEMBLYWOMAN GIUNCHIGLIANI SECONDED THE MOTION.

THE MOTION CARRIED UNANIMOUSLY. ASSEMBLYMAN ARBERRY WAS NOT PRESENT FOR THE VOTE.

Chairman Dini sent for Crystal McGee, Legislative Counsel Bureau, Committee Policy Analyst. In the meantime he proceeded with the concurrences.

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Assembly Bill 279: Provides for availability of industrial insurance benefits to providers of health care for exposure to certain contagious diseases. (BDR 53‑123)

Assemblywoman Leslie explained Senate Amendment No. 706 (Exhibit J), clarified workers compensation would pay for the preventative treatment.

ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO CONCUR WITH SENATE AMENDMENT NO. 706.

ASSEMBLYWOMAN LESLIE SECONDED THE MOTION.