MINUTES OF THE meeting

of the

ASSEMBLY Committee on Government Affairs

 

Seventy-First Session

May 2, 2001

 

 

The Committee on Government Affairswas called to order at 8:07 a.m., on Wednesday, May 2, 2001.  Chairman Douglas Bache presided in Room 3143 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.                     Douglas Bache, Chairman

Mr.                     John J. Lee, Vice Chairman

Ms.                     Merle Berman

Mr.                     David Brown

Mrs.                     Dawn Gibbons

Mr.                     David Humke

Mr.                     Harry Mortenson

Mr.                     Roy Neighbors

Ms.                     Bonnie Parnell

Mr.                     Bob Price

Mrs.                     Debbie Smith

Ms.                     Kathy Von Tobel

Mr.                     Wendell Williams

 

COMMITTEE MEMBERS EXCUSED:

 

Mrs.                     Vivian Freeman

 

STAFF MEMBERS PRESENT:

 

Eileen O’Grady, Committee Counsel

Dave Ziegler, Committee Policy Analyst

Glenda Jacques, Committee Secretary

 

OTHERS PRESENT:

 

George Caan, Executive Director, Colorado River Commission

Marvin Leavitt, Lobbyist, City of Las Vegas

Pat A. Zamora, Director of Accounting, Clark County School District

Fred Hillerby, Lobbyist, Verizon Wireless

Margaret McMillan, Lobbyist, Sprint

Stephanie Tyler, Lobbyist, Cingular Wireless

 

Senate Bill 531:  Revises provisions governing employees of Colorado River commission. (BDR 48-354)

 

George Caan, Executive Director, Colorado River Commission, stated the Colorado River Commission (CRC) was a state agency formed during the 1940s.  They were responsible for defending, protecting and enhancing Nevada’s share of water from the Colorado River.  Nevada had the smallest share of river water and competed with Arizona, New Mexico, Colorado, Utah, and Wyoming for the water.  They were responsible for the acquisition of approximately of 470 megawatts of hydroelectric power worth over $30 million annually from the Hoover, Parker, Davis, and Glen Canyon dams on the Colorado River.  This was the lowest cost electrical resource for any state in the West.  Nevada received about 25 percent of Hoover Dam’s power output.  The CRC was the fifth largest customer of the Western Area Power Administration that marketed power produced by federal hydroelectric dams.  The CRC served 11 utility industrial customers in southern Nevada.  Nevada Power Company received 50 percent of Nevada’s allocation from Hoover Dam.  The CRC represented the state with respect to recovering endangered species on the lower Colorado River.  They also managed nine thousand acres of property in Laughlin for development pursuant to the Fort Mohave Development Act. 

 

In 1996 the Colorado River Commission added two major responsibilities.  They constructed, managed and operated over $100 million worth of electrical and distribution systems that served the southern Nevada Water Authority (SNWA) pumping facilities and industrial customers in Henderson.  The CRC also procured non-hydro electricity for the SNWA and the supplemental needs of industrial customers.  Two hundred megawatts needed to be procured, scheduled and delivered to customers annually.  CRC received no state funds and was fully funded by their customers who paid operational costs through an administrative charge on their power invoice.  The SNWA paid them directly.  They were governed by a board of seven members; four appointed by the Governor and three elected officials.  They provided an excellent balance between the needs of the state and customers of southern Nevada.

 

Mr. Caan stated S.B. 531 provided the CRC with the ability to recruit and retain skilled individuals to carry out their important and difficult responsibilities.  The bill directed the CRC to adopt regulations that created a specific class of state, exempt employees (Exhibit C).  Job titles, wages, and working conditions would be created by the bill following current personnel statute.  Section 20 provided protection for existing CRC employees who did not want the “exempt” status.  The bill changed the name of the Colorado River Commission to the Colorado River Commission of Nevada.  “Executive” was added to the word director and the Griffith Water Project language was deleted.

 

Mr. Neighbors asked what problems had been encountered with the state in regards to “recruiting and retaining.”

 

Mr. Caan stated the CRC operated a $100 million high-electricity and high-voltage transmission and distribution system.  It was very difficult to create a unique job within state government that addressed the specialized talent, salary and working conditions for individuals who were on call 24-hours a day.  The positions needed to be competitive with outside utility agencies.

 

Mr. Neighbors asked why state personnel could not develop a job with the right description.

 

Mr. Caan said they had worked hard to develop it, but state rate schedules or qualifications did not match the CRC’s needs. 

 

Mr. Neighbors asked how “exempt” employees’ retirement would be affected.  Mr. Caan replied all those rights stayed with the employees.  The bill provided a mechanism to actively recruit and develop classifications and pay scales that were needed for the positions.  All vested rights of employees would remain the same.

 

Mr. Neighbors asked if the plan upgraded current salaries.  Mr. Caan stated an analysis would be done on various CRC positions and would determine what the appropriate salary should be.  All salary changes had to be done within the approved budget.  Key personnel were needed to understand the operation of high-voltage systems and oversee the majority of detail work done through contracts or consultants.

 

Ms. Parnell stated Nevada had problems recruiting engineers because of low pay scales.  She was concerned lower paid employees would be brought in to replace current state employees.

 

Mr. Caan stated that was not the intent of the bill.  They envisioned several transitional positions and making “exempt” status voluntary to all existing employee levels.  The CRC had a limited budget and current employees who were vested in the state.  Any “exempted” position refused by a current employee would stay that way until the person left.

 

Ms. Parnell stated many of her constituents had lost their jobs when the state privatized the State Industrial Insurance System.  The Legislature had not adequately addressed the state employees and she had spent two years addressing those issues.  She wanted the employees to be educated on what their rights and options were.

 

Mr. Caan replied the CRC customers supported training for the employees.

 

Vice Chairman Lee asked who the members of the CRC board were.  Mr. Caan clarified the chairman was Richard W. Bunker, vice chairman was Jacob D. Bingham, and other appointed members were Roland D. Westergard and Lamond R. Mills.  The three elected officials appointed from the SNWA were Shari Buck, Myrna Williams, and Bryan Nix. 

 

Mr. Lee asked why Section 12 was deleted.  Mr. Caan clarified because the federal project debt had been paid for by Nevada and transferred to the SNWA by federal legislation, Section 12 was no longer needed.

 

Mr. Mortenson asked if the elected officials were appointed or elected.  Mr. Caan clarified the three board members were elected members of the SNWA and appointed to the board.  Each water agency was governed by certain boards in southern Nevada and appointed members to the SNWA. 

 

Mr. Mortenson asked what the difference was between an “unclassified” or “exempt” position.  Mr. Caan replied the major difference was unclassified and classified employees were governed by NRS Chapter 284 and exempt employees worked under the rules and regulations adopted by the CRC.  Because rules that governed human resources were federally mandated, the regulations would be similar in nature.  Mr. Caan said their staff of 32 had 6 positions classified.  His realized it would be a gradual progression, starting at the senior level, to reach his goal of having all positions exempt.

 

Mr. Mortenson asked who determined the rates charged.  Mr. Caan replied the budget document contained details of salaries and outside contracts.  The proposed budget was reviewed by customers, the seven-member board, the Governor, and the Legislature.  Customers had a strong voice in creating the budget and setting employee salaries.

 

Ms. Von Tobel asked about the drop in Lake Mead and the effect on Nevada.  Mr. Caan stated laws governed how much water each state was allocated.  The “law of the river” allowed any unused allocation to be used by other states.  California was entitled to 4.4 million-acre feet annually and used 5.2 million-acre feet because Nevada and Arizona did not use all of their allocation.  The Interim Surplus Criteria was developed to help California reduce their usage back to their allocation.  The main factor concerning lake levels was hydrology or rainfall.  The Bureau of Reclamation balanced Lake Mead and Lake Powell through “lake equalization.”  Currently Nevada was at 80 percent of their annual rainfall level.  Much of the west was in a drought and water levels had fallen.

 

Ms. Von Tobel asked about the “green slime” at the bottom of the lake and its relationship to Nevada’s drinking water.  Mr. Caan stated he would talk to the SNWA and get information for her.

 

Mr. Price said “S.B. 531 expressly does not affect the rights and privileges granted by law to any present employee, thus employee status in the retirement system” stayed the same.  He asked whether unclassified employees would be entitled to union representation.

 

Mr. Caan stated current employees who did not volunteer for exempt status were protected under statute.  All rules and regulations would be presented before a public hearing for adoption.

 

Mr. Price believed employees had a right to representation and hesitated to put faith in a board to reserve those rights for their employees.  He felt members of the board needed to be elected to gain a variety of opinions.

 

Mr. Caan clarified the board had a unified position of support relating to water resources, endangered species recovery, and access to low-cost hydroelectricity for Nevada.  The caliber of people appointed to the board had made them extremely effective with local and state governments. 

 

Mr. Neighbor asked about the “law of the river” and disbursement of water.  Mr. Caan replied the “law of the river” consisted of a variety of treaties, minutes, compacts, and laws.

 

Mr. Neighbors asked if Nevada’s current allocation of 330,000 acre-feet of water was used.  Mr. Caan clarified the current allocation was 300,000 acre-feet of water annually.  Nevada was allowed to draw more from the river to offset the “return flow credits” they received.  This year Nevada would use all of their allocation and would be able to draw from the surplus.  Any unused water was available for usage.

 

Mr. Neighbors asked about the “red algae” in the newspaper.  Mr. Caan stated he was not qualified to answer the question and would get information for him.

 

Mr. Mortenson asked how many acre-feet were in the “return flow credits.”  Mr. Caan stated approximately 150 to 165 thousand acre-feet.

 

Mr. Mortenson asked if the surplus was available to Nevada.  Mr. Caan replied the Secretary of the Interior could provide any unused water to any state.

 

Mr. Mortenson asked why Nevada paid Arizona for water storage when they could get it free from the surplus.  Mr. Caan replied there was not much unused water available.  Nevada was banking with Arizona for an “up-front” investment to store future water.  Most of the river was fully utilized and Nevada was entitled to only 4 percent of the surplus available.

 

Mr. Neighbors asked how many acre-feet of water California used.  Mr. Caan reiterated California was entitled to 4.4 million-acre feet and Arizona was 2.8 million.  The allocations were based primarily on agricultural usage.

 

Ms. Parnell welcomed all the students from Mr. Longero’s Carson High School class and hoped they enjoyed their stay.

 

Chairman Bache closed the hearing on S.B. 531 and turned the meeting over to Assemblyman Williams to chair.

 

Vice Chairman Williams opened the hearing on S.B. 553.

 

Senate Bill 553:  Makes various changes concerning finances of local governments. (BDR 30-130)

 

Marvin Leavitt, Lobbyist, City of Las Vegas, said S.B. 553 was proposed by the Committee on Local Government and dealt with local government finance problems.  Local government general obligation debt statutes were consolidated when NRS 354 was transferred to NRS 350.  Medium-term obligations had payments that did not exceed a ten-year period.  They were different than most bonds because additional revenues were not available for repayment of the obligations.  The transfer allowed local governments to issue leases beyond the ten-year period originally authorized.  S.B. 553 defined the installment purchase agreement and regulated how they were issued.  Purchases under $100,000 for counties with populations of 100,000 could not be used against the debt limit.  Statute allowed a small portion of each bond issue to be deposited in a fund for extraordinary maintenance.  The accounts were too small to be used and the bill made the requirement optional.  Operating debt proceeds were restricted to bond issues or when the local governments had financial emergencies.  Data was provided for capital plans and the Uniform Commercial Code problem was modified to match national adjustments.  The Senate, at the request of Clark County School District, added section 48 to the bill.

 

Pat A. Zamora, Director of Accounting, Clark County School District (CCSD), stated Section 48 corrected a 1965 Attorney General Opinion that school buses must be purchased with General Fund money.  The CCSD operated over 1000 school buses and the current replacement cost was over $100 million.  The bill allowed air quality control buses to be purchased with bond funds.

 

Mrs. Smith felt it was a large shift to allow bond money to be used that way.

 

Vice Chairman Williams explained the Assembly Committee on Education looked at a bill to expand the rebuilding of schools.

 

Mr. Mortenson stated bond funds were fairly long-term and maybe it was not a good idea to use them for bus purchases.

 

Mr. Leavitt stated generally debt was not issued longer than the life of the asset being purchased with the proceeds of the debt.  Mr. Zamora explained buses had a useful life of 15 years and any debt appropriated would not go beyond the useful life.

 

Mr. Zamora concurred and explained the oldest buses were 1986 models.  Some buses were 17 years old.

 

Mr. Mortenson was concerned about using revenue for operating funds.  Mr. Leavitt said Section 32 stated, “The proceeds of any obligation issued by a local government that has a term which is more than 1 year must be used to pay operating expenses, except that the proceeds of any obligation issued to construct or acquire a facility may be used to pay operating expenses for the period.”  Many times the initial operation was paid for by the debt because operational costs could not cover it.  A specific provision allowed the Department of Taxation to take over any local government that was in financial difficulty.  The White Pine School District had borrowed emergency funds to meet their payroll.  The money was issued under controlled measures and paid back accordingly.

 

Mr. Lee asked about the deletion of lines 20 through 22 in Section 35.  Mr. Leavitt replied the Department of Taxation determined the regulations should be monitored by the Committee on Local Government Finance.

 

Mrs. Smith asked why the bus purchases were limited to bio-diesel fuel.  Mr. Caan said Senator Porter and Senator Titus had requested that.  Adequate grant funding would be available for alternative fuel vehicle conversion.

 

Mrs. Smith asked if those types of buses were currently being purchased.  Mr. Caan replied negatively.

 

Mrs. Smith asked if bond money would be expanded to purchase equipment or furniture for new schools.  Mr. Caan replied affirmatively.  John Swendseid, bond counsel, recommended the language to clear up ambiguities.

 

Mrs. Smith said the bill did not specify new schools and was concerned the money would be used for any school purchase.  Mr. Caan replied he would advise Mr. Swendseid of that.

 

Vice Chairman Williams closed the hearing on S.B. 553 and opened the hearing on S.B. 563. 

 

Senate Bill 563:  Makes various changes relating to telecommunications. (BDR 20-1334)

 

Fred Hillerby, Lobbyist, Verizon Wireless, gave the Mobile Telecommunications Sourcing Act (Exhibit D) to the committee.  The act addressed the confusion of assessing telecommunication taxes when roaming occurred.  Congress decided wireless telephone calls would be assessed on the primary place of usage, either home or business.  S.B. 563 put the statutes in compliance with federal law and would be effective August 2002.  The statute addressed two items concerning the levying of taxes.  The emergency 911 statute and the city and county ability to assess franchise fees against wireless carriers were changed to primary place of usage.  All cellular owners were given appeal rights in the bill.  He proposed an amendment for an effective date of August 2002.

 

Mrs. Smith asked why the legislation had to be adopted to coincide with the new federal law.  Mr. Hillerby clarified states must minimally meet the standards of federal laws.  Any federal law took precedence over state and local laws.

 

Mr. Neighbors explained the federal government could withhold grants or federal money from states that did not comply with federal laws.  Mr. Hillerby explained the federal Driving Under the Influence Act had adjusted the blood alcohol level to .08.  Any state that did not comply with the standard by 2003 would have their federal highway funds withheld.  States could choose to not follow federal standards, but federal funds would be withheld.

 

Chairman Bache asked about the new Verizon policy that prohibited customers from paying by check in person.  Mr. Hillerby stated he would get an answer for the Chairman.

 

Ms. Von Tobel questioned why her Verizon payment took over a month to post to her account.  Mr. Hillerby stated Verizon’s recent mergers and dynamic growth might have caused the problem.  He would check into the problem and get back to her.

 

Mr. Mortenson asked if a person could change their wireless carrier and keep the same cell phone number. 

 

Margaret McMillan, Lobbyist, Sprint, said the Number Portability Federal Law required local phone companies to allow customers to keep their same phone number when they changed carriers or location of their phone number.  The bill did not apply to wireless customers.  All wireless companies supported S.B. 563.

 

Stephanie Tyler, Lobbyist, Cingular Wireless, stated she supported the bill.  Digital systems had narrow bands for each antenna and worked the best in urban areas.

 

Chairman Bache closed the hearing on S.B. 563.

 

Mr. Williams explained the Assembly Committee on Government Affairs had a parallel committee on the Senate side.  Each committee entertained legislation that dealt with local governments and set policy for them.  Local governments throughout the state came before the committees to introduce new legislation that enhanced the citizens of that city or county.  Any bill successfully passed out of the Assembly Committee on Government Affairs went to the floor of the Assembly for the 42 members to vote on.  If successful, it went to the Senate Committee on Government to be debated again.  If successful, it went to the Senate floor for a vote.  Any changes made by the Senate had to be reviewed by the Assembly.  The Legislature dealt with every aspect of Nevada residents’ lives and the Assembly Committee on Governmental Affairs dealt with local government issues.  The members of the committee had the responsibility and the commitment to debate those important issues.  The committee allowed continuity between state and local government.  Mr. Williams was grateful the high school class was here and hoped they learned something about the legislative process.

 

Chairman Bache reminded the students that Nevada legislators were part-time and had a wide range of full-time employment.  The Chairman seeing no further business adjourned the meeting at 9:44 a.m.

 

 

RESPECTFULLY SUBMITTED:

 

 

 

Glenda Jacques

Committee Secretary

 

 

APPROVED BY:

 

 

 

                       

Assemblyman Douglas Bache, Chairman

 

 

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