ASSEMBLY COMMITTEE ON GOVERNMENT AFFAIRS

MINUTES OF THE meeting

of the

ASSEMBLY Committee on Government Affairs

Seventy-First Session

March 29, 2001

The Committee on Government Affairswas called to order at 8:10 a.m., on Thursday, March 29, 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

GUEST LEGISLATORS PRESENT:

Assemblyman John Carpenter, Assembly District No. 33

Assemblyman Don Gustavson, Assembly District No. 32

Assemblyman Lynn Hettrick, Assembly District No. 39

STAFF MEMBERS PRESENT:

Eileen O’Grady, Committee Counsel

Dave Ziegler, Committee Policy Analyst

Glenda Jacques, Committee Secretary

OTHERS PRESENT:

Richard Matthews, Attorney, Elko Convention and Visitors Authority

Stephanie Licht, Lobbyist, Elko County

Allen Biaggi, Administrator, Nevada Division of Environmental Protection

Robert Hadfield, Executive Director, Nevada Association of Counties

Tom Grady, President, Nevada League of Cities

Warren Hardy, Lobbyist, Moapa Valley Water District

Doug Driesner, Director, Nevada Division of Minerals

David Horton, Lobbyist, Committee to Restore the Constitution

Lynn Chapman, Vice President, Nevada Eagle Forum

Scott Scherer, Lobbyist, State Gaming and Control Board

Benjamin Blinn, Citizen, Carson City

Greg Smith, Services Procurement Supervisor, Purchasing Division

Bill Moell, Administrator, Purchasing Division

Assembly Bill 406: Makes various changes to provisions governing Elko Convention and Visitors Authority. (BDR S-656)

Assemblyman John Carpenter, Assembly District No. 33, introduced A.B. 406 to amend the boundaries of The Elko Convention and Visitors Authority. The bill addressed the difficulty of property assessments within The Elko Convention Center district. Determining legitimate voters and annexing new subdivisions created problems. The bill defined voting and taxation boundaries within the Convention Center district.

Richard Matthews, Attorney, Elko Convention and Visitors Authority, stated original legislation had created a district with a “shotgun” pattern of neighborhoods and subdivisions within the city of Elko and the town of Lamoille. New, incorporated lands went through a cumbersome, haphazard process and created extra work for the county clerk. County commissioners could force subdivisions into the district with “show cause” hearings. The county had continuing problems with assessment and voting districts.

In 1995, Elko County commissioners redefined the district, as shown in map B of Exhibit C. The measure failed because the Nevada Attorney General said the commission lacked jurisdiction. Map C showed the proposed district outlined in A.B. 406. Geographic boundaries went along precinct, township and range division lines. The county assessor and clerk helped devise the bill to address their concerns. The lands defined within the geographical area were not assessed under NRS 361A tax law. Cowboy lands already taxed under the statute were exempt from new taxes. Mr. Matthews introduced technical amendments to correct language (Exhibit D).

Mrs. Smith questioned if a public hearing had been held on the proposed changes. Mr. Matthews replied the county commissioners had an agenda meeting last week.

Mr. Carpenter stated the county commissioner had included their letter of support for the proposed legislation (Exhibit C, page 2).

Mr. Brown questioned if any residents had opposed the new map. Mr. Matthews replied they had received no opposition to the proposed bill.

Mr. Mortenson asked if the district residents would be responsible to pay off bond indebtedness.

Assemblyman Carpenter explained the district had been created to pay off bond indebtedness. The debt had been paid off for a number of years and current tax money collected was for upkeep and improvements to the building. Any subsequent bond issue would follow standing procedures.

Mr. Mortenson asked if the convention center was a civic auditorium. Mr. Carpenter replied it was a convention center with an auditorium, display area, and multi-purpose building used by the community.

Stephanie Licht, Lobbyist, Elko County, said the bill made precincts continuous with the convention center district and they supported the bill.

Chairman Bache closed the hearing on A.B. 406 and opened the hearing on A.B. 549.

Assembly Bill 549: Increases amount of general obligation bonds that state board of finance may issue to provide grants to certain water systems. (BDR 30-1328)

Allen Biaggi, Administrator, Nevada Division of Environmental Protection, stated A.B. 549 increased the amount of general obligation bonds used in Nevada drinking water grants programs from $50 million to $69 million. A.B. 198 of the Sixty-Sixth Session created a program to assist municipal drinking water systems in Nevada with the high cost of water supply improvements and Federal Safe Water Act compliance. Projects included piping replacement, treatment system capitalization, tank refurbishment, and other projects that provided adequate and safe drinking water to customers. The funds could be used to meet the revised “Arsenic rule” that was being evaluated by the Bush administration. Since the inception of the rule, 29 recipients had obtained grants totaling $27 million. The majority of the systems were small rural systems. Currently, $32 million was being requested and $10 million had been earmarked for water conservation efforts through A.B. 237 of the Seventieth Session. The total need was $69 million.

Mr. Biaggi said the gap in “needs” versus “funding” water pollution control and drinking water programs was not unique to Nevada. It was estimated nationwide there existed a $3 billion shortfall annually for system upgrades and refurbishments.

Mr. Neighbors remembered when the program was started and felt it was doing a great job.

Robert Hadfield, Executive Director, Nevada Association of Counties, stated the fund helped the people of Nevada more than any other fund and urged the ongoing funding within the constraints of the budget.

Ms. Licht said Jarbidge, Nevada, was a poster child for the fund. The community had 27 full-time residents and had spent over $850,000 to bring their water system within compliance. Midas, Tuscarora, Mountain Home, Montello and other rural communities fell into the same situation. They supported the bill within budget constraints.

Tom Grady, President, Nevada League of Cities, said his town of Yerington had an application in for money to help their water situation and encouraged the support of the bill.

Chairman Bache closed the hearing on A.B. 549 and explained the bill was concurrently referred to the Assembly Committee on Ways and Means.

ASSEMBLYMAN HUMKE MADE A MOTION TO DO PASS A.B. 549.

ASSEMBLYMAN NEIGHBORS SECONDED THE MOTION.

THE MOTION CARRIED BY THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

Assembly Bill 440: Revises provisions governing qualifications and election of members of governing board of Moapa Valley Water District. (BDR S-334)

Assemblywoman Kathy Von Tobel, Assembly District No. 20, stated A.B. 440 was a rural bill that affected the Moapa Valley Water District.

Warren Hardy, Lobbyist, Moapa Valley Water District, explained the bill was basically a cleanup bill. Moapa Valley Water District and other water districts in Clark County had conflicting filing regulations. The board was made non-partisan and residency and filing language was clarified. The declaration of candidacy was changed to conform to other nonpartisan offices in Clark County.

Mr. Humke asked if Section 2’s definition of “residency” would establish precedence in other situations. Mr. Hardy replied that was bill draft language that emulated Clark County language.

Mr. Humke commented residency language was tightened and “duration” of residency was loosened. Mr. Hardy stated they had requested compliance with other Clark County nonpartisan offices and no specific language.

Chairman Bache closed the hearing on A.B. 440 and opened the hearing on A.B. 456.

Assembly Bill 456: Provides for issuance of gaming tokens by State of Nevada. (BDR 19-506)

Assemblyman Don Gustavson, Assembly District No. 32, passed around an example of the Silver Legislative coin with the Nevada State Seal on one side. A.B. 456 allowed Nevada casinos to buy a 1 oz. silver gaming token in $25 denominations from the Nevada State Museum. The unique token would raise revenue for the Nevada State Museum and promote Nevada as a unique place. The participating casinos would design the other side of the coin within certain guidelines. The casino would be able to purchase the coins at the current market price and sell them for a profit. Commemorative silver coins were still used in Nevada. The bill was not mandatory legislation.

Mr. Gustavson explained the proposed amendments (Exhibit E). The designer of the token would be given the first numbered token plus any fees charged. “Current market price” replaced the monetary value of $25.

Mr. Lee asked what the intent of the bill was. Mr. Gustavson explained the purpose was two-fold. First, it would raise money for the State of Nevada Museum and secondly, promote a unique and collectible gaming token.

Mr. Neighbors asked if some of profit would be used to clean up abandoned mines. Mr. Gustavson replied there would not be sufficient profit for that.

Mr. Neighbors stated a current ounce of silver on the open market was roughly $5 and questioned what production costs were.

Mr. Gustavson replied silver blank coins cost $6. The mint charged roughly $5 to stamp them with the Nevada seal. The casinos could purchase the tokens for approximately $11.

Mr. Neighbors said the casinos had their own tokens and questioned if the token could be used in casino machines. Mr. Gustavson replied it could be adapted to machines, but would be used mainly at tables. The tokens would be interchangeable among the casinos.

Mr. Mortenson wanted the state to benefit from the transaction. Mr. Gustavson replied they had to keep costs down to attract casino business.

Mr. Lee asked where it specified profits went to the Nevada State Museum. Mr. Gustavson explained the Governor’s advisory committee outlined no “up front” money was needed because interested casinos would provide the capital. Any profit money went directly to the museum to produce more coins or use as they saw fit.

Mr. Brown questioned cost of token production and what was the museum mark up. Mr. Gustafson responded a museum representative could address that at a future date.

Mr. Brown asked if the intent of the bill was to create revenue or create a unique token. Mr. Gustafson replied the original intent was to create nontax revenue for the state and possibly expand the museum.

Mr. Neighbors questioned a possible amendment for abandoned mine cleanup. $15,000 had cleaned up over 100 abandoned mines. Mr. Gustafson said that would not be a problem if it could be coordinated with the Museum’s Administrator/Director.

Chairman Bache was concerned about possible counterfeit coins minted outside and brought into the casinos. He questioned what security measures prohibited counterfeiting.

Mr. Gustafson had discussed that issue with the Nevada City Mint. Counterfeit coins would put private mints out of business. Mint companies had strict security to protect their business.

Doug Driesner, Director, Nevada Division of Minerals, offered their support. Silver played an important part in Nevada’s heritage. Nevada silver mines produced over 23.2 million ounces of silver last year and marked the sixth year that Nevada silver production has exceeded 20 million ounces annually. Passage of A.B. 456 would increase awareness of Nevada’s leadership role in silver production. NRS 235.016 mandated the director of the Department of Administration to set and collect a royalty for use of The Great Seal of the State of Nevada and deposit that money in an account for the Division of Minerals. The proposed amendment (Exhibit F) would allow royalties to be collected and used for the securing of abandoned mines.

Mr. Lee felt the language “establish a royalty” was too broad and should be defined in a memorandum of understanding. Mr. Driesner replied the amount had not been defined because it fluctuated with the amount of tokens produced.

Mr. Mortenson questioned how much royalty was received from coins currently produced. Mr. Driesner explained the royalty was on a sliding scale and based upon the spot price of silver. It currently was $.05 per coin.

David Horton, Lobbyist, Committee to Restore the Constitution, supported the bill. He suggested amending the $300,000 provision to provide a portion to the General Fund to prevent royalties from halting the initial operation.

Lynn Chapman, Vice President, Nevada Eagle Forum, explained she was a coin collector. She felt it was important to offer coins to tourists and natives.

Scott Scherer, Lobbyist, State Gaming and Control Board, had concerns about how gaming tokens were minted. They would work with the committee to have the tokens conform to counterfeit or federal treasury regulations.

Chairman Bache responded the bill did not need a subcommittee and they would accept proposed amendments in writing.

Mr. Scherer replied it would take a day or two to put the concerns in writing and he would bring them back to the committee at the appropriate time.

Mr. Mortenson requested a sheet that showed profit potential and coin production costs.

Mr. Neighbors commented they would appreciate any additional revenue to help clean up abandoned mines.

Mrs. Smith questioned if there had been citizen interest in serving on the Museum Advisory Board. Mr. Gustavson replied he had no problem in getting people to serve on the board. He would make copies of the museum’s profit structure and distribute it to the committee.

Benjamin Blinn, Citizen, Carson City, felt the bill was a pioneering move beneficial to the state.

Chairman Bache closed the hearing on A.B. 456 and opened the hearing on A.B. 427.

Assembly Bill 427: Revises provisions relating to contracts for state purchasing. (BDR 27-694)

Greg Smith, Services Procurement Supervisor, Purchasing Division, stated during “request for proposal” evaluations the technical part was separated from the cost part. Assemblyman Hettrick wanted to codify that both parts of the evaluation process were brought back together before a vendor was selected. Exhibit G reflected the major change to Section 2, subsection 5. The purchasing division was constantly looking to move forward and improve operations.

Mr. Lee asked how “bidder preference” was used in state purchasing.

Bill Moell, Administrator, Purchasing Division, stated they were adamantly opposed to bidder preference. It was not good public policy and was gradually being phased out nationwide.

Chairman Bache replied bidder preference was mainly used in construction public works projects. Mr. Lee appreciated learning about different statutes.

Mr. Neighbors questioned why the bill was needed if specifications were already in place. Mr. Moell answered the bill attempted to codify the process already covered in statute. The main issues addressed were not commodities, but service procurements.

Mr. Neighbors commented the state purchasing contract required them to go with the best bidder with the best value and not necessarily the lowest bidder.

Ms. Parnell commented the bill was intended to keep the bid at the “best” bid and not necessarily the “lowest” bid.

Mr. Brown asked if bonding requirements were needed for service contracts. Mr. Smith answered risk management set the requirements for each bid and many projects required bonds.

Mr. Brown asked about financial requirement regulations. Mr. Smith replied financial stability was of great concern. Dunn & Bradstreet reports and other financial documentation were used.

Mr. Brown questioned if the bonds had ever been used. Mr. Smith answered they had not. Mr. Moell replied strict monitoring of vendors had prevented that from happening.

Chairman Bache closed the bill until Assemblyman Hettrick could arrive.

ASSEMBLYMAN NEIGHBORS MADE A MOTION TO AMEND AND DO PASS A. B. 406 WITH THE PROPOSED AMENDMENT.

ASSEMBLYMAN BROWN SECONDED THE MOTION.

THE MOTION CARRIED BY THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

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ASSEMBLYMAN HUMKE MADE A MOTION TO DO PASS A. B. 440.

ASSEMBLYWOMAN SMITH SECONDED THE MOTION.

THE MOTION CARRIED BY THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

Chairman Bache said the subcommittee on A.B. 61 finished yesterday and they would bring their recommendation to the committee later. He explained A.B. 182 was heard on February 28 and there had been discussion on amendments and would be ready for the committee soon.

Assembly Bill 285: Provides for appeal of decision of appointing authority regarding use of catastrophic leave by state employee. (BDR 23-438)

Ms. Parnell explained the bill created a five-member executive branch committee to review catastrophic leave. Individual agencies had the authority to approve catastrophic leave and there was no consistency. The committee would review the individual agency decisions. There had been no opposition to the bill.

ASSEMBLYWOMAN PARNELL MADE A MOTION TO DO PASS A.B. 285.

ASSEMBLYMAN WILLIAMS SECONDED THE MOTION.

THE MOTION PASSED BY THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED

Assembly Bill 326: Requires local governments to disclose certain expenses relating to lobbying. (BDR 31-496)

Chairman Bache asked Mr. Lee if there were proposed amendments to the bill.

Mr. Lee replied there was no opposition to the bill and suggested Mr. Zeigler could refresh the committee’s memory.

Dave Ziegler, Committee Policy Analyst, stated Assemblyman Goldwater had provided testimony. Carole Vilardo and Stephanie Licht supported the bill and there were no proposed amendments.

ASSEMBLYMAN LEE MADE A MOTION TO DO PASS A. B. 326.

ASSEMBLYWOMAN PARNELL SECONDED THE MOTION.

Mr. Humke remembered Ms. Licht wanted the bill to apply to state agencies.

Mr. Zeigler said his notes reflected Stephanie Licht had raised the question whether the bill should also apply to “gray badges” or state employees.

Chairman Bache said it was the committee’s discretion to include that as an amendment.

Mrs. Smith felt some of the state agency lobbyists were staff and were not in front of the committee very often.

Chairman Bache stated there was a difference between being requested to be here and advocating a certain bill.

Ms. Licht said she was serious that each lobbyist group be treated equally. Assemblyman Goldwater’s intent was to let taxpayers of each entity know how much money was spent advocating for certain issues. Most state agency testimony was requested by the Legislature for specific information. Elko County had no position on the bill.

ASSEMBLYMAN HUMKE MOVED TO AMEND THE MOTION ON A.B. 326 TO INCLUDE STATE AGENCIES UNDER THE BILL. THE AMENDMENT WOULD REFLECT THAT UNSOLICITED TESTIMONY WAS EXEMPT.

ASSEMBLYMAN WILLIAMS SECONDED THE MOTION.

Chairman Bache clarified that Ms. O’Grady was clear on the proposed amendment. Ms. O’Grady replied affirmatively.

Mr. Mortenson asked if the bill had a fiscal note on it. Chairman Bache said Assemblyman Goldwater of the Assembly Ways and Means Committee could address any possible fiscal notes. The bill required the Legislature to “line item” their lobbyist expenditures and would not need additional funding.

Mrs. Smith would vote no on the amendment because it would be complicated for agencies to sort out meetings their staff attended.

Mr. Neighbors supported Mr. Humke’s proposal because there was a difference between lobbying and testifying.

Ms. Parnell opposed the amendment because it was a jurisdictional issue.

Ms. Von Tobel supported the amendment. Universities employed lobbyists and it should be reported.

Ms. Parnell said a paid lobbyist was different than testimony received for informational purposes. She would support an amendment that defined “paid” lobbyists.

Mr. Humke said the intent of his amendment allowed persons compelled to testify before the Legislature to not be reported. The University system should be classified as part of the state in regards to the bill. Section 1 allowed a $6,000 threshold and eliminated occasional testifiers. The important part was outside, paid lobbyists would be covered under the amendment.

THE MOTION CARRIED WITH ASSEMBLYWOMAN PARNELL AND SMITH ABSTAINING. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

Chairman Bache reopened the hearing on A.B. 427.

Assemblyman Lynn Hettrick, Assembly District No. 39, stated he agreed with the proposed amendments. The bill would establish minimum bidder requirements and would combine the bidder scoring package.

Chairman Bache closed the hearing on A.B. 427.

ASSEMBLYMAN NEIGHBORS MADE A MOTION TO AMEND AND DO PASS A.B. 427.

ASSEMBLYWOMAN VON TOBEL SECONDED THE MOTION.

THE MOTION CARRIED BY THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

Assembly Bill 367: Creates information technology commission. (BDR 19-48)

Vice Chairman Lee stated the bill allowed a combined effort to promote technology and was to be referred to the Assembly Ways and Means Committee.

Mr. Zeigler explained Assemblywoman Tiffany had testified this was the second time the bill had been introduced. The technology commission looked at information exchanged. The Governor was selected to chair the commission with two vice-chairs. Any legislative salaries would come out of the legislative fund and the bill had no opposition. The green book reflected a fiscal note of $1,865 annually for the next two years.

ASSEMBLYMAN LEE MADE A MOTION TO AMEND AND DO PASS A.B. 367 AND REREFER TO THE ASSEMBLY WAYS AND MEANS COMMITTEE.

ASSEMBLYMAN HUMKE SECONDED THE MOTION.

Ms. Parnell felt the scope of the commission should be as broad as possible and private industry board members should not be limited to Nevada residency.

Mrs. Smith felt the legislature needed to be sure enough money and resources were available to the commissions.

Chairman Bache clarified the Assembly Ways and Means Committee had jurisdiction over those issues and would address them.

Mr. Mortenson stated maybe the best consulting advice available was not in Nevada and they should not limit themselves.

Mr. Lee felt the commission belonged to Nevada and should be limited to Nevada residents.

THE MOTION CARRIED WITH THOSE PRESENT. ASSEMBLYWOMAN FREEMAN WAS EXCUSED.

Mr. Neighbor questioned whether a subcommittee could discuss new information they processed a bill.

Chairman Bache said he would accept the subcommittee’s report and the subcommittee could provide additional information to the committee.

Mr. Price reminded the committee the legislature was not covered by the open-meeting law.

Chairman Bache seeing no further business adjourned the meeting at 10:29 a.m.

RESPECTFULLY SUBMITTED:

Glenda Jacques

Committee Secretary

APPROVED BY:

Assemblyman Douglas Bache, Chairman

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