MINUTES OF THE meeting
of the
ASSEMBLY Committee on Natural Resources, Agriculture, and Mining
Seventy-First Session
March 5, 2001
The Committee on Natural Resources, Agriculture, and Miningwas called to order at 1:30 p.m., on Monday, March 5, 2001. Chairman Marcia de Braga presided in Room 3161 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:
Mrs. Marcia de Braga, Chairman
Mr. Tom Collins, Vice Chairman
Mr. Douglas Bache
Mr. David Brown
Mr. John Carpenter
Mr. Jerry Claborn
Mr. David Humke
Mr. John Marvel
Mr. Harry Mortenson
Mr. Roy Neighbors
Ms. Genie Ohrenschall
COMMITTEE MEMBERS ABSENT:
Mr. John J. Lee
GUEST LEGISLATORS PRESENT:
None
STAFF MEMBERS PRESENT:
Linda Eissmann, Committee Policy Analyst
June Rigsby, Committee Secretary
OTHERS PRESENT:
Steve Bradhurst, Nye County Consultant
Doug Bierman, Consultant for Lander, Lincoln, and Eureka Counties
Doug Thunder, Deputy Superintendent for Administrative and Fiscal Services, Nevada Department of Education
Debbie Cahill, Nevada State Education Association
Alan O’Neill, Executive Director, Outside Las Vegas Foundation
Ron James, Nevada State Historic Preservation Officer
Alice Baldrica, Nevada State Historic Preservation Office
Oyvind Frock, Citizen
Mervin Wright, GIS Specialist, Department of Water Resources, Pyramid Lake Paiute Tribe
Vicki Christy, Project Coordinator, Great Basin Inter-Tribal NAGPRA Coalition
Daryl Crawford, Executive Director, Inter-Tribal Council of Nevada
Tim Crowley, Nevada Mining Association
Joe Johnson, Toiyabe Chapter of the Sierra Club
After roll was called, Chairman de Braga called for discussion of A.B. 120.
Assembly Bill 120: Revises distribution of federal money received by State of Nevada from lease of federal lands. (BDR 26-97)
Assemblyman Roy Neighbors, representing Nye, Esmeralda, and Lincoln Counties, commenced testimony in support of the bill. A handout (Exhibit C) was distributed to the committee members. Mr. Neighbors presented background information on the distribution of federal funds from the U.S. Department of Interior. Under the Mineral Leasing Act of 1920 and the Geothermal Steam Act of 1970, mineral lease revenues were generated from royalties, rents, and bonuses. With the exception of Alaska, all states were slated to receive 50 percent of the revenues collected from any public domain mineral lease located within their respective boundaries.
Mr. Neighbors elaborated on Nevada Revised Statutes (NRS) 328.450 that stipulated the first $7 million received by Nevada was to be deposited in the State Distributive School Account (DSA) and the remainder into the Account for Revenue from the Lease of Federal Lands. Distributions from the latter account were stated as 25 percent to the DSA and the remaining 75 percent to the county of origin.
Under A. B. 120, Mr. Neighbors explained that money received in a fiscal year by the state, pursuant to Section 191 of the Mineral Leasing Act, must be deposited in the Account for Revenue from the Lease of Federal Lands. The largest portion of revenues (75 percent) was to be used by the counties for construction and maintenance of public facilities, public services, and planning. The remaining 25 percent was slotted for use by the school districts.
Mr. Neighbors stated that in 1985 he became aware of the federal law governing revenues from leasing. Nevada at that time had no law on the books that recognized this source of revenue. Research of other states was conducted, resulting in the drafting of state legislation. Based on the $12 million revenue from two oil wells at that time, a threshold of $10 million was established. In 1995 it became apparent that the threshold should be cut to $7 million.
In response to Mr. Marvel’s question about the reason for dropping the threshold, Mr. Neighbors explained that the projected revenues were always too low, and the threshold levels of $10 million and $7 million were never met. At the current time, revenues were estimated at $2.6 million.
Mr. Bache requested clarification as to whether the bill under discussion had already been heard in the committee on Government Affairs the last two sessions. Mr. Neighbors replied in the affirmative. The bill had been heard in the Assembly committee on Ways and Means, and it was passed unanimously both times. In response to Mr. Bache’s inquiry regarding chapter referrals, Mr. Neighbors elaborated that the numbers were current.
Steve Bradhurst, Consultant to Nye County, resumed testimony in support of A.B. 120. His involvement with the issue dated back to 1985. Mr. Bradhurst reiterated that the threshold amount of $7 million had never been met and clarified that the proposed bill did not have any threshold. Through the years, revenues had never met projections, with the current estimate at $2.6 million. This trend in revenue drop coincided with a marked decrease in oil activity and an increase in geothermal operations.
Mr. Marvel requested clarification on the removal of the DSA from the distribution of funds. Mr. Bradhurst replied in the affirmative. In response to Mr. Marvel’s inquiry regarding the impact of the energy crisis on oil and geothermal exploration, Mr. Bradhurst speculated that oil activity in Railroad Valley would not increase due to the poor quality of the product. One option would be if revenues did skyrocket, the distribution would be reversed, with the first $7 million going to the county impacted by the activity, followed by some distribution to the Distributed School Account (DSA). To date, Mr. Bradhurst emphasized that not a penny had ever been distributed to the affected area.
Mr. Bradhurst called the committee’s attention to a memo to Tom Stephens, Director of the Nevada Department of Transportation (NDOT). The subject was the poor condition of Duck Water Road and Nye County’s request to NDOT to assume the maintenance of the road. Because costs were estimated at more than $8 million, NDOT refused to accept responsibility. Mr. Bradhurst reminded the committee that the Mineral Leasing Act had been designed specifically for the needs in the county impacted by the federal leasing activity (i.e., roads).
Mortenson requested clarification about the precipitous drop in revenues in 1987. Mr. Bradhurst explained that it was attributed to the sharp drop in oil exploration. He referred the committee to documentation in Exhibit C.
Mr. Neighbors elaborated on the projected revenue of $2.6 million and described it as only one quarter of one percent of the DSA budget. In terms of impacts to the county, he cited the 25 miles of dirt roads that had been maintained through the years by Nye County. He reiterated that, despite the removal of the dollar threshold in A.B. 120, he would be willing to rework the numbers in the event of revenues surpassing $7 million.
Mr. Neighbors made reference to a 1995 legal decision (Exhibit C) in which it was concluded that Nevada Revised Statutes (NRS) 328.450 was not in strict compliance with the spirit of the original federal law. Priority for distribution was stated as being the county that was impacted by the mineral leasing operations, not the state.
Mr. Bradhurst concluded his testimony with a review of various federal programs that shared revenues with the impacted county. The Mineral Leasing Act was described as part of that bigger picture in which adverse impacts at the local level were mitigated by a reimbursement system.
Mr. Carpenter inquired about the likelihood of the Association of Counties bringing suit against the state for non-compliance with the federal law. Mr. Bradhurst explained that Nye County had resorted to that option, and he speculated that other counties would follow the example as their awareness grew. Mr. Neighbors interjected that Nye County had outside counsel, and he had no personal involvement in the lawsuit. See Exhibit D.
In response to Mr. Carpenter’s question regarding the status of the lawsuit, Mr. Bradhurst stated that the Nye County Commissioners resorted to the lawsuit out of frustration.
Assemblyman Brown requested information about distribution schemes in other states. Mr. Bradhurst cited Colorado as an example where funds were distributed to the local government. In Wyoming, a trust fund was established at the state level and the local government would appeal for funds. All 50 states were entitled to 50 percent distribution under the federal law, except for Alaska where 90 percent was allocated.
Mr. Marvel posed a question about the impact to the DSA. Mr. Neighbors replied that the impact would be minor based on the projected revenues of $2.6 million. He emphasized that, historically, counties had lost millions in their share of the federal distribution. Mr. Bradhurst interjected that Nye County was motivated by the issue of equity and the right to benefit from the first $7 million. If there was a windfall of revenues, the school fund would benefit as well.
Doug Bierman, consultant for Lander, Eureka, and Lincoln counties, commenced testimony in support of A.B. 120 on behalf of Lander, Lincoln, and Eureka Counties. He distributed a handout (Exhibit E) containing a map of Nevada displaying federal land. Nevada counties with a preponderance of federal land depended greatly on a fair share of revenues generated by federal land activity.
Doug Thunder, Deputy Superintendent for Administrative and Fiscal Services, Department of Education, commenced testimony in opposition to A.B. 120. He clarified that the general fund would be the source for lost revenues. At the local level, Mr. Thunder expressed concern that federal monies received directly at the local level would be considered as “outside the formula” revenues.
Chairman de Braga asked if there would be impact on the two-year budget process, given the fluctuations in the federal leasing revenue source. Mr. Thunder explained that the general fund would have to make up the difference. Mr. Marvel expressed concern over the possible shortfall of $5 million. Mr. Bradhurst reiterated that there were only two wells in operation in Railroad Valley, and each contributed very little to the tax base.
Mr. Neighbors clarified that his numbers still revealed an impact of less than one quarter of one percent. He posed a question to the witness if he felt that the intent of the federal law had been carried out. Mr. Thunder replied that the money was to be distributed in accordance with the legislature’s requirements. He had no legal opinion of the matter.
Debbie Cahill, Nevada State Education Association, resumed testimony in opposition to A.B. 120. She stated emphatically that, despite some merit to the bill, her organization opposed the bill. The impact in funding to the DSA would be significant, especially when the general fund would not be in a position to make up the loss.
Chairman de Braga acknowledged that concerns over funding were evident in many other areas of state government, but that, in the area of education, there had developed a dependence on the DSA funds. Mr. Marvel interjected that the bill should be referred to Ways and Means for attachment of fiscal impact.
Chairman de Braga closed the hearing on A.B. 120 and called for testimony on A.B. 230.
Assembly Bill 230: Makes various changes relating to protection of cultural resources. (BDR 33-600)
Assemblyman Mortenson commenced testimony on behalf of A.B. 230, the stewardship bill. The support for the bill was described as widespread, including the Bureau of Land Management (BLM), the U. S. Forest Service, the U.S. Parks Service, Nevada Historic Preservation, the Desert Research Institute, nonprofit cultural and professional organizations, and the public. Of notable mention was the group “Outside Las Vegas” whose stated mission was to preserve the quality of public lands by working with government.
Alan O’Neill, Executive Director of Outside Las Vegas, resumed testimony. With more than 7 million acres of federal land, 15 million visitors, and only 330 federal employees, there was clear opportunity and need to assist in the stewardship of the land. Monitoring of sites with cultural and natural heritage would be accomplished using a cadre of volunteers. Arizona had demonstrated success with a similar program.
Mr. Mortenson interjected with a comment regarding the lack of participation by the tribal nations at their organizational meeting. It was noted that there was tribal representation in the room.
Resuming testimony was Ron James, the Nevada State Historic Preservation Officer. He explained that the program with Outside Las Vegas was new and, despite an estimate of 60 percent federal funding, would require supplemental funding from the state. In response to Chairman de Braga, Mr. James elaborated on the fiscal note. It would create an office in southern Nevada, giving the State Historic Preservation Office a presence in Las Vegas. There would be one staff person (grade 35), building rent, operating expenses, and travel. Mr. James stated that he regretted the need for state funding, but without it, the program would not survive.
Mr. Mortenson reminded the committee that 60 percent of the required $70,000 would be funded by federal dollars. Mr. James explained that the fiscal note was the total budget.
Alice Baldrica, Deputy State Historic Preservation Officer, resumed testimony in support of the bill. The program was designed to train volunteers who would help monitor the condition of historic sites and public recreation areas. Their role was to be vigilant from a distance and to report back to park rangers and other authorities. In Arizona, more than 700 volunteers were trained to monitor 500 sites of historic importance. The need to include the tribal representatives was recognized.
Mr. Marvel, with reference to the Department of Cultural Resources, asked if this type of program would serve as impetus in the future for the development of similar programs. Mr. James stated that adding one employee in the Las Vegas area would leverage scores of volunteers, and spending money now would ultimately save money in the future.
In response to Mr. Carpenter’s question about other advisory commissions, Mr. James stated that the federal law, NRS 381, and NRS 383 all required that the historic preservation office have a board of oversight. The proposed bill would call for an advisory commission with very distinct and separate responsibilities.
Mr. Carpenter asked for clarification on the subject of the inventory of cultural resources. Mr. James explained that there was a tremendous backlog in their efforts to update the inventory. With more than 3,000 archaeological sites to survey, he viewed the proposed legislation as providing an essential volunteer workforce to augment that inventory.
In regard to the potential conflict of uses on public lands, Mr. Carpenter voiced concern over the infringement on the rights of everyday users (e.g., rancher or miner). He felt that it was evidenced in the composition of the Advisory Board that appeared to be elite and had failed to include representatives from major users of the land. Mr. James acknowledged Mr. Carpenter’s concerns regarding the placement of hurdles in the way of miners or ranchers. The law would need to be compatible with a variety of interests including economic development, recreation, and historic preservation. Communication between the users of the land was described as the critical success factor.
Ms. Baldrica interjected that the cadre of volunteers would likely include persons with a broad spectrum of experience, interest, and knowledge. As such, there was potential for a synergistic working relationship among all users of the land.
Mr. Carpenter acknowledged that the Bureau of Land Management did not have the manpower to assist ranchers and miners in the field. Ms. Baldrica clarified that the focus of volunteer training was site monitoring, however there could be other duties that volunteers might be willing to do. In response to the placement of a miner or rancher on the advisory board, Ms. Baldrica stated that the terminology would be an individual from a private or rural industry.
Mr. Mortenson and Mr. Neighbors echoed Mr. Carpenter’s concerns and stated that the bill should be amended to expand the membership of the advisory board. The delays posed by historic preservation activities were described as very serious to a mining operation.
Oyvind Frock, Reno resident and member of the Nevada Archaeological Association, resumed testimony in support of the bill. Mr. Frock shared a personal experience in which he reported an incident of site disturbance to officials. He concluded that vigilant citizens, performing informal monitoring, would be strengthened in their work by the proposed formal training of volunteers.
Mervin Wright, representing the Pyramid Lake Paiute Indian Tribe, distributed a handout (Exhibit F) and commenced testimony in support of A.B. 230. Mr. Wright described the deep concerns that Native Americans had with regard to preservation of historic and prehistoric sites in Nevada. Despite the existence of protective federal laws, a lack of manpower precluded the enforcement of those laws.
Mr. Wright voiced several reservations with the proposed legislation. The first was related to the process of appointing members to the advisory board. His second concern was the listing of all historic sites in the state inventory. Mr. Wright stated that the best protection for some sites was to be left unknown to the public. In his judgment, the Stewardship Program would work if there were full cooperation from all parties, including state and federal officials, the tribes, scientists, and the advisory board of elite appointees.
Mr. Wright stated that a recent court decision in Alaska would complicate the prosecution of site looters. Because of claims of ignorance on the part of the defendant, Mr. Wright emphasized the value of the educational focus of A.B. 230. He cautioned the committee against the assignment of a monetary value to a cultural site, stating that it would invite vandalism and looting.
Mr. Wright acknowledged the need to balance the needs of economic development with those of historic preservation. Communication breakdown was cited as a problem. Often archaeologists failed to notify the tribe and were known to bypass the laws.
In conclusion, Mr. Wright voiced his concern with the vague wording regarding the issue of the tribal representative on the board. An amendment to include all three tribes, the Washoe, the Shoshone, and the Paiute, would be a good starting point. Term limits would provide more opportunity for a wide variety of tribal representation on the board.
Vicki Christy, representing the Great Basin Inter-Tribal NAGPRA Coalition, read a prepared statement (no handout) in support of A.B. 230. She viewed the legislation as the needed catalyst to bring together all players with a stake in the land. She voiced concerns over the single tribal representative on the advisory board as well as the confidentiality of the inventory of sites in Nevada. Ms. Christy called attention to an oversight. As written, A.B. 230 appeared to emphasize site protection, with no mention of site restoration. Finally, the Nevada tribes were not given adequate opportunity to review A.B. 230.
Daryl Crawford, representing the Inter-Tribal Council of Nevada, supported the testimony given by Mr. Wright and Ms. Christy.
Chairman de Braga asked for clarification of the concern with listing all sites in an inventory. Mr. Wright reiterated that publicizing the locations of historic sites would invite looting if the information was in the hands of the wrong person. He acknowledged that some information would have to be accessible to users of the land. Mr. Wright was fully aware of the need to balance the needs of economic development with those of historic preservation, however, in his judgment, economic interests usually prevailed.
Chairman de Braga inquired about the amount of time the tribes would need to review the bill. Mr. Wright stated that, if the record remained open, he would submit written testimony within two weeks.
Former Assemblywoman Gene Segerblom, a member of the Outside Las Vegas group, offered support and endorsement of A.B. 230.
Tim Crowley, representing the Nevada Mining Association, testified in support of the bill. His only concerns surrounded the definition of “cultural resources” and the vague wording of “traditional significance.” Mr. Crowley offered to work with the bill sponsors, and he suggested that “historic” might be a more appropriate choice of words.
Joe Johnson, representing the Toiyabe Chapter of the Sierra Club, resumed testimony in support of A.B. 230. He speculated that many of his 4,000 members in Nevada would likely become volunteers in the new stewardship program.
The final witness in support of A.B. 230 was Catherine Ademan, a resident of Silver City and a member of the Comstock Historic District Commission. In defense of archaeologists, she stated that there was no record of an archaeologist misusing inventory data to loot sites.
Chairman de Braga closed the hearing on A.B. 230 and called for the committee introduction of BDR S-1095 (A.B. 283).
ASSEMBLYMAN BACHE MOVED TO INTRODUCE BDR S-1095.
ASSEMBLYMAN COLLINS SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
Chairman de Braga called for the committee introduction of BDR 40-390 (A.B. 284).
ASSEMBLYMAN BACHE MOVED TO INTRODUCE BDR 40-390.
ASSEMBLYMAN COLLINS SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
Due to the lateness of the hour, the decision was made by Chairman de Braga to postpone the scheduled work session. A reminder was issued to the members of the leukemia subcommittee to attend the March 6 meeting. The meeting was adjourned at 3:39 p.m.
RESPECTFULLY SUBMITTED:
June Rigsby
Committee Secretary
APPROVED BY:
Assemblywoman Marcia de Braga, Chairman
DATE: