MINUTES OF THE meeting
of the
ASSEMBLY WAYS AND MEANS/SENATE FINANCE
JOINT Subcommittee on HUMAN RESOURCES/K-12
Seventy-First Session
April 19, 2001
The Joint Subcommittee on Human Resources/K-12was called to order at 8:12 a.m. on Thursday, April 19, 2001. Chris Giunchigliani, Chairwoman, presided in Room 3137 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.
ASSEMBLY COMMITTEE MEMBERS PRESENT:
Ms. Chris Giunchigliani, Chairwoman
Mrs. Barbara Cegavske
Mr. Joseph Dini, Jr.
Mr. David Goldwater
Ms. Sheila Leslie
Ms. Sandra Tiffany
SENATE COMMITTEE MEMBERS PRESENT:
Senator Raymond D. Rawson
Senator William J. Raggio
Senator Bob Coffin
Senator Bernice Mathews
COMMITTEE MEMBERS ABSENT:
None.
STAFF MEMBERS PRESENT:
Mark Stevens, Assembly Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Larry Peri, Senior Program Analyst
Bob Atkinson, Program Analyst
Georgia Rohrs, Program Analyst
Carol Thomsen, Committee Secretary
Kathryn Fosnaugh, Committee Secretary
Chairwoman Giunchigliani announced that the subcommittee would commence with budget closings.
BUDGET CLOSINGS
VITAL STATISTICS – BUDGET PAGE HEALTH-007
Bob Atkinson, Program Analyst, Legislative Counsel Bureau (LCB), advised the subcommittee that staff recommended technical adjustments to the budget, one of which would be an adjustment to the base budget to increase the amount of the reimbursement from Social Security Administration due to an increase in the reimbursement rate for issuance of social security numbers. That adjustment would increase Social Security Administration revenues and, when combined with a minor adjustment in the federal Risk Behavioral Grant, would decrease the General Fund appropriation by $10,144 in FY2001-02 and $11,550 in FY2002-03.
According to Mr. Atkinson, subsequent to the preparation of the budget, the Health Division requested that the biostatistician position, which was included in the Vital Statistics budget and funded via the Maternal Child Health (MCH) Block Grant, be transferred to the Health Administration budget account, where it would be funded through indirect costs. Mr. Atkinson stated that staff had reviewed the request and would recommend approval of the transfer. Staff recommended closure of the budget as adjusted.
Mr. Atkinson advised the subcommittee that removal of the biostatistician from the Vital Statistics budget would free-up MCH Block Grant funding in the amounts of $71,487 in FY2001-02 and $77,269 in FY2002-03. The subcommittee could consider a number of ways to utilize those funds in light of the tremendous flexibility allowed in the utilization of MCH grant funds.
Chairwoman Giunchigliani pointed out that those funds could be reallocated to any of the following options:
1. Funding for creation of a new Health Resource Analyst II position, which was the priority request of the Health Division;
2. Restoration of a portion of the funding for the 10.5 public service intern positions recommended for elimination within the Special Children’s Clinic budget;
3. Direct the MCH Block Grant funds not already obligated toward special efforts similar to the Dental Health Initiative approved by the 1999 legislature; or,
4. Direct the MCH Block Grant funds not already obligated to Health Administration, Maternal Child Health, Community Health Services, or the Special Children’s Clinic, where the funding could possibly be utilized to reduce General Fund support.
Chairwoman Giunchigliani stated that testimony presented at an earlier hearing regarding the elimination of the public service intern positions would cause her to lean toward the second option, which would restore a portion of those positions, however, she asked members to voice their opinions. Ms. Leslie stated she would also definitely favor that option. Senator Rawson concurred, and indicated that should be the subcommittee’s first option; any remaining funds could be allocated to address the other requests.
Chairwoman Giunchigliani asked the subcommittee whether there was support for the transfer of the biostatistician position, which would free-up MCH Block Grant funding, with allocation of those funds not already obligated to restore a portion of the public service intern positions for the Special Children’s Clinic (Budget Account 3208).
SENATOR RAWSON MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY STAFF, INCLUDING TECHNICAL ADJUSTMENTS, WITH TRANSFER OF THE BIOSTATISTICIAN POSITION TO THE HEALTH ADMINISTRATION BUDGET ACCOUNT, AND ALLOCATION OF THE MCH BLOCK GRANT FUNDS NOT ALREADY OBLIGATED TO RESTORE A PORTION OF THE PUBLIC SERVICE INTERN POSITIONS FOR THE SPECIAL CHILDREN’S CLINIC (BUDGET ACCOUNT 3208.)
MS. LESLIE SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Dini, Mr. Goldwater, and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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HEALTH AID TO COUNTIES – BUDGET PAGE HEALTH-13
The Health Aid to Counties budget was funded by General Fund appropriation and transfers from the Motor Vehicle Pollution Control Account (Budget Account 4722), and provided pass-through funding to the health districts in Washoe and Clark Counties. The monies were provided on a per capita basis and were in addition to other federal grant flow-through funds allocated to those two health districts. The per capita rate included in The Executive Budget was $0.80. Mr. Atkinson explained that staff recommended the following adjustments:
According to Mr. Atkinson, the subcommittee should be aware that the Joint Subcommittee on Public Safety, Natural Resources and Transportation, was hearing the Pollution Control budget presentation, which would free-up the funding for the Health Aid to Counties’ budget account, and the 10 percent allocation previously referenced would be subject to the approval of that joint subcommittee. The proposed adjustment would result in a General Fund appropriation reduction of $54,559 in FY2001-02 and $59,100 in FY2002-03.
Senator Rawson noted there were some policy decisions for the subcommittee’s consideration in the Health Aid to Counties’ budget, and inquired whether there were any limitations, regulations, or guidelines, either federal or state, which determined the percentage allocated from the Pollution Control budget. Mr. Atkinson replied that there were no limitations, regulations, or guidelines that he was aware of, however, the historic allocation had been 10 percent. The funding from the Pollution Control budget was allocated to a variety of budget accounts per the Nevada Revised Statutes (NRS). Mr. Atkinson explained that the freed-up money in the Pollution Control account would consist of the elimination of the excess reserve grants that had previously been distributed. Senator Rawson acknowledged that not all problems could be solved at once, but wondered whether language could be added that established the percentage split, which the legislature could work toward in the future. The percentage split was adjusted in 1991 and it took ten years to readjust the split to the original allocation. Senator Rawson felt that Health Aid to Counties was an important account for the counties, and perhaps the split should be 75:25 percentage ratio, or perhaps 50:50. He asked staff to recommend possible action, which would ensure that a budget guideline was established for future reference.
Chairwoman Giunchigliani indicated Senator Rawson was correct, and explained that the percentage had been adjusted at several past sessions, however, had been set at a 90:10 percentage ratio over the last several biennia. Mr. Atkinson concurred, and noted that the subcommittee was addressing two separate issues. The per capita rate for reimbursement, which was set at $0.80, had been set at $1.10 some time ago, was then reduced to $0.55, and slowly increased to $0.80. The second issue was the funding percentage split between the General Fund and the Pollution Control budget account.
Senator Rawson recommended that the subcommittee establish the goal of a per capita rate for reimbursement of $1.10, and a 75:25 percent ratio split between the General Fund and the Pollution Control budget account, provided staff felt such action could be supported, or a similar action which was as close to those stipulations as possible via adjustments, in order to free-up General Fund dollars. Chairwoman Giunchigliani agreed, and stated she had worked in the past with the Nevada Association of Counties (NACO) to bring the per capita rate back to $1.10; however, the rate had never hit that mark. If the legislature established and set a benchmark, it would allow the counties to plan more accurately.
Senator Rawson pointed out that if the subcommittee adjusted the per capita rate to $1.10 at the current time, it would require a General Fund allocation of approximately $500,000 for each year of the biennium, so the subcommittee should specify that the goal would be to eventually reach $1.10, and follow staff recommendations in closing the budget. Even though staff might not be comfortable with the inclusion of extra language in the budget closure, Senator Rawson felt the figure could be included as the targeted goal. Chairwoman Giunchigliani suggested a Letter of Intent to establish that goal, as had been done in past sessions when a goal was established as a benchmark. Senator Rawson commented that if no benchmark was established, the amount would continue to fluctuate from year to year.
MS. TIFFANY MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY STAFF, INCLUDING TECHNICAL ADJUSTMENTS, ISSUANCE OF A LETTER OF INTENT TO ESTABLISH THE GOAL OF $1.10 AS THE PER CAPITA RATE, AND ESTABLISHMENT OF A FUNDING SPLIT OF 75 PERCENT GENERAL FUND APPROPRIATION AND 25 PERCENT POLLUTION CONTROL APPROPRIATION DURING THE UPCOMING BIENNIUM, IF THE POLLUTION CONTROL FUND CONTAINED SUFFICIENT FUNDS TO ALLOW THAT SPLIT, OR FOR FUTURE BIENNIA.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Dini, Mr. Goldwater, and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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PUBLIC HEALTH TOBACCO FUND – BUDGET PAGE HEALTH-77
Mr. Atkinson reported that the budget account utilized funds from the interest garnered on the 10 percent set-aside from tobacco settlement monies for the Trust Fund for Public Health. The fund awarded grants from that interest for the promotion of public health, programs for the prevention of disease or illness, and the provision of direct health care services to children and senior citizens as mandated by the 1999 legislature. Mr. Atkinson noted that no grants had been issued during the current year, and a Request for Proposal (RFP) had recently been released; it was anticipated that the first grants would be awarded in early FY2001-02. The Executive Budget recommended grant awards of $224,442 in each year of the upcoming biennium. Staff recommended closure of the budget as recommended by the Governor.
MS. TIFFANY MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY THE GOVERNOR.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Dini, Mr. Goldwater, and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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HEALTH FACILITIES HOSPITAL LICENSING – BUDGET PAGE HEALTH-26
Mr. Atkinson stated there were problems within the budget account regarding the amount of revenues to be collected, and during the subcommittee hearing of February 15, 2001, the division was instructed to work with staff to resolve those problems. The most recent information from the Health Division indicated that under the current fee structure, the revenue shortfall in the first year of the biennium would be approximately $1 million, and approximately $1.3 million in the second year. Mr. Atkinson had asked the division to present an overview of the solution to the problem for the subcommittee.
Alex Haartz, Deputy Administrator, Health Division, Department of Human Resources (DHR), advised the subcommittee that the division had been working with the LCB’s Fiscal Division staff, the Budget Division, the DHR, and had recently met with staff from the Governor’s Office as well. As currently budgeted in The Executive Budget, the revenue authority was overstated by approximately $1 million each year of the biennium when compared to the current state licensure fee schedule. Mr. Haartz informed the subcommittee that the division was in the process of developing a plan which would make licensure fee activities inclusive of complaint investigations, regular state licensure, as well as follow-up activities required of the division, which had not been included in the fee schedule. The division would be working to include all activities as reimbursable under the current rate structure for facilities.
Senator Rawson noted it was assumed that fees would be billed to the hospitals or facilities in order to raise the revenue, and asked whether there was any “trimming” that could be done within the budget, i.e., vacancy savings, or was it a “hold the line” budget presentation. Mr. Haartz indicated the division would be working with associates from hospitals, as well as other facilities, in order to reach an agreement regarding the fee structure. With regard to the budget account for Health Facilities Hospital Licensing, Mr. Haartz explained the division had conducted extensive analysis, and the actual projected workload would approximate that 22 full-time surveyor staff were necessary to conduct state licensure activities. The budget was “no growth” and maintained the current 17.5 facility staff that performed those activities. Mr. Haartz noted that staff would be working full time simply to maintain the current workload. The division had also reviewed the budget to ensure it had maximized the federal revenues, as the government was responsible for its full share of the costs. Cuts in the budget would further reduce the division’s ability to handle the existing workload.
Senator Rawson appreciated the situation, and noted that the subcommittee was considering closure of the budget with the understanding that the division would raise the necessary funds to complete its budgetary needs. While there was no doubt that funds could be raised, Senator Rawson did not feel that was the proper method of developing a budget for approval by the legislature. He noted that such practices would have to cease, because the legislature also had a fiduciary responsibility. The largest component of inflation within the state was health care, and Senator Rawson noted the subcommittee was considering passage of $1 million in licensure fees into the health care industry, which would translate into increases in health care for consumers, and that was of great concern.
Mr. Haartz stated the division understood that concept, and explained the workload would meet the current requirements of the NRS, as far as state licensure activities and complaint investigations, in order to ensure that the health care provided to Nevada citizens was, in fact, the quality which was expected. Senator Rawson inquired whether the 17.5 positions were currently filled. Mr. Haartz indicated that two or three of the positions were vacant. Senator Rawson noted that the Health Facilities Hospital Licensing budget would be difficult to reconcile, and inquired whether the budget would be workable if staff was trimmed by two positions, and the division was given the authority to raise fee rates. Mr. Haartz stated he would have to review the budget with those stipulations in mind, and would be happy to provide information to staff.
Ms. Tiffany stated the information provided to the subcommittee indicated the cost for providing services had more than doubled over existing revenues, and asked whether fees were charged for inspections for adult day care, modified medical detoxification facilities, obstetric centers, prisons, and other unlicensed facilities. Mr. Haartz stated that in regard to those particular facilities, there were some exemptions delineated in the NRS, and the division was required to conduct licensure and inspection on those facilities, however, could not collect fees. Ms. Tiffany felt that might be an issue for future review, because the situation was inequitable to the facilities that paid for inspections.
Chairwoman Giunchigliani asked Mr. Haartz to provide further information regarding current positions, and whether there were other areas of potential fee collections. According to Chairwoman Giunchigliani, potential changes to the NRS regarding fee collection could also be reviewed by the legislature. She requested that information regarding the Governor’s proposal, along with recommendations to trim the budget, be submitted to the subcommittee by April 24, 2001. Senator Rawson suggested that the subcommittee stipulate it would trim the budget by 25 percent if the requested information was not received by April 24, 2001.
Chairwoman Giunchigliani closed the hearing on the Health Facilities Hospital Licensing budget with no final action taken by the subcommittee, pending receipt of requested information.
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AGING SERVICES GRANTS – BUDGET PAGE AGING-1
Chairwoman Giunchigliani explained that the budget supported the Independent Living Grants Program, and the policy decision for the subcommittee would focus on the amount of tobacco settlement monies that would fund the ongoing position.
Georgia Rohrs, Program Analyst, LCB, stated the Aging Services Grants budget was a new account to support the Independent Living Grants Program, which was funded entirely via tobacco settlement monies. The Executive Budget recommended distributing an additional $5.6 million in grants for each fiscal year of the 2001-03 biennium, which would constitute an increase of $1 million per year over the current funding. According to Ms. Rohrs, based on the most recent projections of tobacco settlement funds, decision unit E-450 recommended an increase of $4.2 million in each year of the upcoming biennium over the base year, which would increase funding for independent living grants and also would support a 1.0 full-time equivalency (FTE) Auditor II position. Presently, noted Ms. Rohrs, there was a grants analyst position which had been approved by the Interim Finance Committee (IFC) in June 2000; that was the only position currently in the budget.
Ms. Rohrs stated that technical adjustments in decision unit E-450 were changes to in-state travel and operating expenses to reflect the later hire date of October 1, 2001, rather than July 1, 2001. Computer costs were adjusted to reflect current contract costs pursuant to instructions from the Purchasing Division, and cost savings would increase the amount available for independent living grants. The major policy issue in the budget, and also in related budgets within the Aging Services Division, was whether the subcommittee wished to approve staffing positions, and funding or expanding ongoing programs in other budget accounts within the division, as an appropriate use of tobacco settlement monies.
Senator Rawson stated decisions regarding the use of the tobacco settlement monies were extremely difficult, and suggested that the subcommittee consider a one-time allocation of tobacco settlement monies to fund the requested positions. Essentially, that would give notice that continuing costs would require development via the General Fund, or an alternate funding source. Senator Rawson indicated the subcommittee should stipulate that the windfall of tobacco settlement monies, which should be allocated to specific areas, would no longer be available to fund positions and ongoing programs after the 2001‑03 biennium. Programs should not be built on a foundation of tobacco settlement monies because that funding source would eventually end. Senator Rawson stated that he understood the current funding crisis, and was willing to approve a one-time allocation, as long as notice was given that an alternate source of funding would be required in future budgets. The necessary allocation could be built into the division’s base budget in the future, while the subcommittee gave notice that tobacco settlement monies would only be utilized during the upcoming biennium. Ms. Tiffany asked for clarification regarding the one-shot allocation. Senator Rawson noted that, technically, programs could not be built with one-shot allocations.
Chairwoman Giunchigliani explained that the original intent of the tobacco settlement monies was to allocate grants for independent living related to certain health care factors, and funding positions would divert the monies from the intended use as grant funding. If the subcommittee made the recommendation for a one-shot allocation, it should be made very clear that the budget for future biennia would include the costs for all positions in the base budget via a General Fund allocation.
Ms. Tiffany asked whether the Auditor II position would be in addition to other auditor positions within the program. Ms. Rohrs stated the only position presently in the budget was a grants and programs analyst approved by the IFC in June 2000. The auditor position had been requested at the same time, however, was deferred by the IFC because the Independent Living Grants Program had not been in operation for a sufficient amount of time to warrant an auditor position. Ms. Tiffany commented that if several grants were awarded, the program would be in need of an auditor. Senator Rawson pointed out that there were auditor positions within the Aging Services Division and the DHR. Ms. Tiffany asked whether there was another position within the division that handled the oversight of the program.
Mark Stevens, Assembly Fiscal Analyst, LCB, explained that the DHR had requested an auditor position at the June 2000 IFC meeting, however, that position was designated for the Senior Rx Program. When the Aging Services Division came forward to request an auditor position, there were questions regarding whether it was too early to approve two auditor positions. It was felt that the demands placed on the auditor position within the DHR should be evaluated, and once the workload data was available, a determination could be made regarding whether another auditor position would be needed. Mr. Stevens stated he had not specifically reviewed the workload data regarding the auditor position within the DHR.
Senator Mathews wondered whether the subcommittee could close the budget with a Letter of Intent, if staff felt that would solve the problem, regarding funding for the positions after the 2002-03 biennium, to ensure that tobacco settlement funds were not utilized for further funding. Chairwoman Giunchigliani concurred, and stated that was an excellent idea. Ms. Leslie indicated she was willing to approve the direct service positions, however, requested clarification regarding use of tobacco settlement monies for a computer systems technician position. Ms. Rohrs stated the budget requested a computer systems technician position for the Carson City/Reno area, to support the division’s personal computers. The division had an information system specialist position in Las Vegas, however, there were approximately 130 computers located throughout the state with no support staff available. According to Ms. Rohrs, the requested position would be a Grade 29, to provide support in the northern Nevada and Elko areas. Ms. Rohrs pointed out that one‑half of the costs for the proposed positions would be funded via tobacco settlement monies, with the exception being the Homemaker Programs (Budget Account 3252), where the social worker position in Las Vegas would be fully funded via tobacco settlement monies; six positions altogether were being requested.
Ms. Leslie indicated she was uncomfortable with utilization of tobacco settlement monies to fund positions, and did not think the subcommittee should set a precedent whereby other agencies would approach the IFC and request positions funded via tobacco settlement monies. Senator Rawson stated if the subcommittee approved the funding for positions within the Aging Services budgets via tobacco settlement monies, the precedent would be set. Per Senator Rawson, the positive aspect of such funding was that it would produce some matching funds from Medicaid, which would free-up General Fund dollars; however, the subcommittee would be supplanting General Fund dollars with tobacco settlement monies, which was not the intent of the original allocation to the Independent Living Grants Program.
Vice Chairwoman Giunchigliani asked Ms. Rohrs to continue her budget presentation with Budget Account 3252, EPS/Homemaker Programs, in order to give subcommittee members a better understanding of what positions were being requested via tobacco settlement funding, with a view to final action upon completion of that presentation.
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EPS/HOMEMAKER PROGRAMS – BUDGET PAGE AGING-19
Ms. Rohrs stated the Elder Protective Services (EPS) Program provided protective services, including investigative services, for elderly persons aged 60 years and older. The Homemaker Programs provided in-home services such as homemaking tasks, grocery shopping, errands, and stand-by assistance. All recipients in the program received case management services. Ms. Rohrs explained that the issue for subcommittee consideration was, once again, use of tobacco settlement monies to expand the Homemaker Programs. The positions requested were delineated in decision unit M-200, and included a temporary social worker position approved by the IFC; however, the IFC wanted the legislative money committees to determine whether it would be appropriate to continue to fund the position from tobacco settlement monies. The second position requested was an additional social worker, which would also be funded entirely from tobacco settlement monies.
Ms. Rohrs pointed out that another issue for subcommittee consideration was whether it wished to fund a Wide Area Network (WAN) for the division, to be funded by Title XX monies. The cost for the network endorsement would be split among the EPS/Homemaker budget, the Aging Older Americans Act, and the Senior Services Program budgets.
Decision unit E-710, replacement equipment, consisted of a request for Title XX funding money to purchase two executive chairs, two desks each year, a shredder, a fax machine for the Las Vegas office, six computers in FY2002, and eight computers in FY2003. Ms. Rohrs reported that GroupWise software was requested for Internet connections between offices, and cost for the computers had been adjusted to reflect the current contract prices, at a cost savings of $546 in FY2002 and $728 in FY2003. Ms. Rohrs noted that a corresponding reduction was reflected in the Title XX amount needed. There were also technical adjustments to computer prices in decision unit M-200 for the additional positions, which would reduce the tobacco settlement allocation by $91. Reductions attributable to cost savings would not impact services to clients.
Senator Rawson inquired whether the temporary position, which the division requested to make permanent, would be funded via tobacco settlement monies. Ms. Rohrs indicated that position would be fully funded via the tobacco settlement.
SENATOR RAWSON MOVED TO CLOSE BUDGET ACCOUNT 3140, AGING SERVICES GRANTS, AND BUDGET ACCOUNT 3252, EPS/HOMEMAKER PROGRAMS, AS RECOMMENDED BY STAFF, INCLUDING TECHNICAL ADJUSTMENTS, WITH THE DIRECT SERVICE POSITION IN THE HOMEMAKER BUDGET FUNDED VIA A ONE-TIME ALLOCATION FROM TOBACCO SETTLEMENT MONIES, WITH THE UNDERSTANDING THAT DIRECT SERVICE POSITIONS WOULD NOT BE FUNDED IN SUBSEQUENT BIENNIA VIA TOBACCO SETTLEMENT MONIES; A LETTER OF INTENT WOULD BE ISSUED TO CLARIFY THAT ANY POSITIONS FUNDED VIA TOBACCO SETTLEMENT MONIES FOR THE FY2001-03 BIENNIUM WOULD BE FUNDED ON A ONE-TIME BASIS ONLY.
MS. LESLIE SECONDED THE MOTION.
THE MOTION CARRIED. (Mrs. Cegavske, Mr. Goldwater, and Senator Raggio were not present for the vote.)
According to Senator Rawson, the message being sent by the motion was that new growth and ongoing programs would not be funded via tobacco settlement monies, even though programs were certainly very important. He suggested that the subcommittee initiate a priority list of positions to be funded via General Fund allocations, and if funding became available, those positions could be funded in order of priority.
BUDGETS CLOSED.
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DHR ADMINISTRATION – BUDGET PAGE HR-ADMIN-1
Larry Peri, Senior Program Analyst, LCB, stated there were several small technical adjustments which were recommended by staff. The first adjustment was in the base budget and consisted of the increase of a .75 FTE Management Assistant II position to a full-time Management Assistant III position. That position was increased by the IFC at its April 13, 2000, meeting in order to provide support to the Healthy Nevada Fund Administration budget. The suggested recommendation included the intent that the Healthy Nevada Fund Administration budget would provide 25 percent of the funding for the existing position within the DHR Administration budget. The adjustment would not reduce the General Fund allocation, but would add the transfer of revenue from the Healthy Nevada Fund Administration budget in the amount of $8,365 for FY2002 and $8,456 for FY2003, with a correlating adjustment in the salary category.
Per Mr. Peri, the other technical adjustment for consideration by the subcommittee consisted of a reduction to the General Fund because of revised prices for computer equipment and software packages from the Purchasing Division.
Mr. Peri explained that during budget closing hearings in the 1999 session, the subcommittee added MAXIMUS revenue to the DHR Administration budget, for transfer to the Bureau of Alcohol and Drug Abuse (BADA) for adolescent substance abuse treatment programs. He noted that The Executive Budget for the 2001-03 biennium did not recommend the continuance of that funding source. Mr. Peri indicated a Letter of Intent from the 1999 legislature supported the position that the BADA could not expend that allocation until the money was actually collected and deposited into its budget. The DHR had indicated to LCB Fiscal Division staff that the Governor did intend to earmark the first $500,000 of MAXIMUS funds received during the 2001-03 biennium for the BADA. The subcommittee could consider whether to add revenue and expenditure authority to the DHR Administration budget account, which would be earmarked for transfer to the BADA budget for adolescent substance abuse treatment programs, with the understanding that no expenditures could be made by the BADA until the allocation was actually collected and deposited.
Ms. Tiffany recommended that $500,000 each year of the biennium be earmarked for transfer to the BADA for the adolescent substance abuse treatment program. If other revenue was realized from MAXIMUS, she would suggest that $250,000 each year of the biennium, or in either year of the biennium as available, be utilized for funding homeless programs. That allocation could be made after the BADA allocation of $500,000. Chairwoman Giunchigliani advised that the subcommittee could handle such a request via a Letter of Intent. Mr. Peri reported that revenue authority for collections built into FY2001 amounted to approximately $2.5 million, and the actual collections to date were approximately 10 percent of that amount, or $225,000, which had been collected and deposited.
Mr. Stevens stated that last fiscal year’s reversion was in excess of $1 million in MAXIMUS revenue, and a $500,000 allocation was balanced-forward to the current fiscal year for the BADA grants. Ms. Tiffany asked whether the funding was anticipated to be the same or greater over the upcoming biennium. Mr. Stevens indicated that the DHR staff would be better equipped to answer that question, as MAXIMUS funds appeared to be diminishing during the current fiscal year. There were no guarantees that the money would become available and, at some point in time, the funding source would not be as lucrative as it had been in past years. Ms. Tiffany asked whether staff could explain why the funds were dwindling. Mr. Stevens explained that MAXIMUS reviewed various federal programs to enhance the state’s revenues, and while there might be additional programs available, it appeared to be a diminishing pool with fewer opportunities. Ms. Tiffany inquired whether the Letter of Intent from the subcommittee could also encourage the DHR to be more aggressive in maximizing MAXIMUS revenue.
Mr. Dini asked the DHR to comment regarding MAXIMUS funding. Debbra King, Administrative Services Officer IV, DHR, explained that MAXIMUS dollars were achieved based upon the contractor identifying previously unclaimed federal dollars. The contractor was then paid 9 percent of the total funds located and secured for the state. Ms. King stated the contractor was similar to any other business, and sought out the “low hanging fruit,” or programs where there were large “chunks” of easily identified money available, in order to complete the work, receive the percentage, and move on. In past years, the DHR had realized large amounts of MAXIMUS revenue, however, Ms. King explained that revenue was currently decreasing. The ongoing projections for the current fiscal year were approximately $2.2 to $2.3 million, and to date, the DHR had received approximately $220,000. Ms. King pointed out that the revenue was questionable, because it was based on the identification of federal programs and the ability to secure the funds.
Ms. Leslie indicated she would speak in favor of Ms. Tiffany’s idea, and noted that MAXIMUS money had historically been available throughout each biennium; she felt the proposed pilot program for the homeless was a worthwhile project. Should the program prove successful, Ms. Leslie indicated local governments would more than likely be willing to provide future funding. According to Ms. Leslie, the legislature should use its discretion in setting priorities, and noted that in previous years the DHR had approached the IFC for programs that required funding via MAXIMUS dollars. Ms. Leslie proposed that the subcommittee take a more aggressive stand and indicate that, if and when MAXIMUS funding became available, the homeless program would be a funding priority. Ms. Leslie then suggested that rather than splitting the $1 million allocation between fiscal years for the BADA program, and $500,000 for the homeless program, that those funds simply would be allocated throughout the biennium, so that as funding became available it could be utilized in a more expeditious manner. Mr. Stevens felt such an allocation could be accomplished, and noted that during the current biennium, the DHR staff had requested that the $500,000 which normally reverted to the General Fund, be balanced-forward to finance the BADA portion of the MAXIMUS revenue, which had been done in order to accommodate the BADA grant. Chairwoman Giunchigliani suggested that, should the subcommittee approve allocation of MAXIMUS funds in that manner, it be stipulated in the budget along with a Letter of Intent to solidify the grants to the BADA and the homeless program.
Ms. Tiffany asked whether the DHR’s contract with MAXIMUS included any type of leverage to encourage more aggressive research regarding available programs, and was there competition in the field. Ms. King advised the DHR would go out to bid regarding the revenue maximization contract, and indicated the MAXIMUS contract had been in place for approximately six years. The DHR would attempt to locate more energetic contractors.
Chairwoman Giunchigliani explained the subcommittee could take action that would ensure the MAXIMUS funds were allocated and tracked within the budget, followed with a Letter of Intent to allow for the balance-forward, so funding received during the second year of the biennium would also be properly allocated. Funding for the homeless program would be considered as the second tier for MAXIMUS funding revenue. Senator Rawson stated that should be added as a line item to the budget, to alleviate the need to approach the IFC for approval.
Continuing his presentation, Mr. Peri explained the remaining issues in the budget for the subcommittee’s consideration were relative to the addition of positions. Overall the budget recommended a total of eight new FTE positions, as contained in decision units E-276 through E-280, all of which would be funded via the General Fund at a total of approximately $970,000 over the upcoming biennium. It should be noted the subcommittee requested that the DHR provide a priority listing of new positions; the agency informed staff that the Governor’s Office would provide that information under separate cover, however, to date no response had been received. Therefore, explained Mr. Peri, there was no priority list for the subcommittee’s consideration. Chairwoman Giunchigliani suggested that the subcommittee not approve the requested eight positions, and add them to the aforementioned priority list for further consideration should General Fund dollars become available.
Addressing decision unit E-806, the reclassification of the current classified Administrative Services Officer IV to an unclassified deputy director, at a cost to the General Fund of $24,463 over the 2001-03 biennium, Chairwoman Giunchigliani reported that her research indicated the unclassified deputy director position included very specific roles and duties. The current Administrative Services Officer IV did review and coordinate budgets, but it was not a supervisory position, and Chairwoman Giunchigliani did not feel there was a case for reclassification to an unclassified deputy director. She suggested that perhaps an increase in grade level, from a Grade 44 to a Grade 45, could be considered because of the coordination of the various divisions provided by the present Administrative Services Officer IV.
MS. LESLIE MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY STAFF, INCLUDING TECHNICAL ADJUSTMENTS, AND:
§ WITHHOLDING APPROVAL OF THE REQUESTED EIGHT NEW POSITIONS WHICH WOULD BE PLACED ON THE PRIORITY LIST FOR CONSIDERATION ONCE THE DHR PROVIDED ITS PRIORITY LIST;
§ UPGRADE THE EXISTING ADMINISTRATIVE SERVICES OFFICER IV POSITION FROM A GRADE 44 TO A GRADE 45;
§ CREATION OF THE MAXIMUS FUNDING LINE ITEMS OF $500,000 IN EACH YEAR OF THE BIENNIA ALLOCATED TO THE BADA, AND A SUBSEQUENT ALLOCATION, AS DIRECTED IN A LETTER OF INTENT, OF $250,000, AS IT BECAME AVAILABLE, TO THE HOMELESS PROJECT, TO BE UTILIZED IN EITHER YEAR OF THE BIENNIUM;
§ ISSUANCE OF LETTER OF INTENT SPECIFYING THAT NO EXPENDITURES COULD BE MADE UNTIL THE MAXIMUS REVENUE WAS EARNED AND MATERIALIZED.
Ms. Tiffany inquired whether the DHR had provided any suggestions regarding cutbacks in its budget. Mr. Peri indicated it was his understanding that the DHR and the Budget Division had been working on potential budget reductions; however, no information had been forthcoming to date.
MS. TIFFANY SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Goldwater and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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HEALTHY NEVADA FUND – BUDGET PAGE HR-ADMIN-9
Mr. Peri noted that the Healthy Nevada Fund budget had several issues for subcommittee review, the first of which was the matching payment of 25 percent to the DHR Administration budget just closed by the subcommittee for the full-time Management Assistant III position in the director’s office. Mr. Peri asked that staff be allowed to insert the appropriate payment mechanism and make the adjustments to the account to make the funding accessible in the DHR Administration budget.
Decision unit E-250 was a major decision unit which recommended that the grant for the reduction of tobacco use and the grant for health improvements for children and the disabled be removed from the Healthy Nevada Fund budget account and transferred to the newly recommended Grants Management Unit budget account. Mr. Peri explained such action would transfer $12,963,030 in tobacco settlement funds over the biennium to that newly proposed budget. Should the subcommittee choose not to approve the proposed Grants Management Unit, decision unit E-250 would be reversed, and the Healthy Nevada Fund budget would remain intact.
Chairwoman Giunchigliani asked Mr. Peri to provide an explanation regarding the Grants Management Unit budget prior to closing the Healthy Nevada Fund budget.
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GRANTS MANAGEMENT UNIT – BUDGET PAGE HR-ADMIN-31
Mr. Peri stated the Grants Management Unit was a newly proposed budget account within The Executive Budget, and the intent was to develop a structured, coordinated, and consistent system for awarding, managing, evaluating, and tracking pass-through funding to other entities. The account would total slightly over $31 million in each year of the biennium, and proposed consolidation of funding from several existing budget accounts or programs as follows: (1) Title XX Purchase of Social Services; (2) Family to Family Connection; (3) Family Resource Centers; (4) Community Services Block Grant; (5) Children’s Trust Account; (6) various domestic violence grants; and (7) the Healthy Nevada Fund grants.
According to Mr. Peri, the proposed Grants Management Unit would consolidate the various budgets and programs, and the subcommittee had several issues and choices before it:
§ Did the subcommittee wish to approve the creation of the Grants Management Unit.
§ If not approved, the budget account would be eliminated, the budgets and programs contained therein would be restored, and staff would provide information regarding any adjustments or alternatives needed in those budgets. An example would be the Family to Family Connection budget, which was recommended for reduction in The Executive Budget and, based on subcommittee direction, staff would provide alternatives for consideration by the subcommittee at the time that budget would be scheduled for closing.
§ If the subcommittee chose to approve the Grants Management Unit budget as recommended, staff would be required to make revenue adjustments as the DHR had submitted adjustments based on reexamination of the budget process.
Chairwoman Giunchigliani reminded members that the subcommittee had reviewed the budget on several occasions, and the consensus of opinion was that it was not time to move toward approval of the Grants Management Unit. Chairwoman Giunchigliani recommended that the subcommittee not approve the unit and instruct staff to restore the budgets appropriately. It should also be recommended that the DHR allow the Family-to-Family Connection program and the Family Resource Centers to establish sliding fee schedules, if deemed necessary, and utilize the dollars generated for existing programs or program expansion.
Senator Rawson stated the idea of better management of grants had merit, and suggested that staff review the possibility of additional personnel to follow the grant processes; he felt the proposal for a Grants Management Unit should be brought forward again in the future.
Ms. Tiffany stated she liked the idea of consolidating grants, however, did not feel the proposal had been well thought-out. She would like the DHR to approach the IFC for further review, even though it had previously reviewed the issue. Ms. Tiffany asked whether there was an appetite for the subcommittee to send a letter to the DHR requesting additional review and further information regarding consolidation, and return to the IFC with additional ideas in forming the Grants Management Unit. Chairwoman Giunchigliani felt the concept was good, however, the plan was not well laid out; she did not feel it would be appropriate for the IFC to allocate any funding for the program. The DHR could be encouraged to ponder the idea more inclusively with the various groups, organizations, or agencies, and submit a recommendation to the Governor for inclusion in The Executive Budget for the 2003-05 biennium. Ms. Tiffany indicated that the state should never refuse federal grant monies, and should there be a need to fund a position to move the concept forward, that could be accomplished via the IFC.
Ms. Leslie opined that it might not be a good idea to remove grants from the divisions where they had been placed and put them under the control of the director’s office. A case might be made by the DHR for better internal coordination, and if a position was needed to undertake such action, along with a more aggressive search to locate and access grants, Ms. Leslie would be very receptive to that type of plan. Simply moving grant funds to a new budget account would create a great deal of chaos.
SENATOR RAWSON MOVED THAT THE SUBCOMMITTEE NOT APPROVE THE PROPOSED GRANTS MANAGEMENT UNIT BUDGET, WITH RESTORATION OF THE INDIVIDUAL BUDGETS, INCLUDING THE POSSIBILITY OF SUPPLEMENTING THE FAMILY TO FAMILY CONNECTION PROGRAM, WHILE ALLOWING THAT PROGRAM AND THE FAMILY RESOURCE CENTERS PROGRAM TO INITIATE A SLIDING FEE SCHEDULE.
MR. DINI SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Goldwater and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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HEALTHY NEVADA FUND – BUDGET PAGE HR-ADMIN-9
Chairwoman Giunchigliani announced that she would consider a motion from the subcommittee to close the Healthy Nevada Fund budget, which it had previously reviewed.
SENATOR RAWSON MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY STAFF, WITH REVERSAL OF DECISION UNIT E-250.
MR. DINI SECONDED THE MOTION.
THE MOTION CARRIED. (Mr. Goldwater and Senator Raggio were not present for the vote.)
BUDGET CLOSED.
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Chairwoman Giunchigliani announced that the subcommittee would hear a briefing and discuss budget items regarding information provided by the Interim Study Committee created by A.C.R. 53 of the Seventieth Session, to study the Integration of State and Local Child Welfare Systems. Chairwoman Giunchigliani noted that the Assembly Committee on Ways and Means had previously held a simultaneous hearing on A.B. 343, which would provide for integration of state and local child welfare systems, and A.B. 512, which would make an appropriation to the DHR for costs associated with transfer of certain child welfare systems; however, the subcommittee would accept recommendations regarding how to pare down the costs.
Mr. Peri called the subcommittee’s attention to Exhibit C, a booklet of supplemental information prepared by the LCB’s Fiscal Division staff, which provided an overview and summary from the Interim Study Committee charged with studying the potential integration of state and local child welfare systems. Mr. Peri explained that the issue had to begin with a base line amount, and Exhibit C contained the figures that the Division of Child and Family Services (DCFS) estimated it spent, or had available to spend, on the child welfare effort in FY2000, which was just over $59 million. As the study continued, Clark and Washoe Counties were asked to review the issue and develop estimates of resources that might be needed in order to perform the child welfare services that were proposed for transfer from the state to the counties. Pages 2 and 3 of Exhibit C represented the culmination of the work completed by the Interim Study Committee created by A.C.R. 53 of the Seventieth Session, and provided a summary of the funding gap and/or additional needs that were identified. Mr. Peri stated that a portion of the $59 million in existing funding would be proposed for allocation to the counties to support existing services, and the gap would be represented by the amount necessary for the counties to provide services.
Mr. Peri reiterated that the Committee on Ways and Means had recently held a hearing on A.B. 343 and A.B. 512, and most members of the subcommittee were familiar with the proposed integration. Mr. Peri pointed out that the net total estimated additional costs of $2.2 million in FY2002 and $10.6 million in FY2003, as depicted in Exhibit C, were the figures included in The Executive Budget. The Governor had been provided the information regarding the integration in December 2000, and the exhibit explained that decision unit E‑250 in Budget Account 3229, Youth Community Services, within the DCFS would cover those costs. According to Mr. Peri, Exhibit C also contained one‑shot estimates, and the Interim Study Committee suggested that one-time appropriations be removed and held separate from ongoing costs. The revised total was $4.7 million and $3.2 million respectively in FY2002 and FY2003, which was also recommended by the Governor in The Executive Budget. Mr. Peri went on to explain that A.B. 512 would provide a total allocation of $7,994,650. The remaining contents of Exhibit C consisted of the response from Washoe and Clark Counties, and the DCFS, which provided specific information on proposed integration plans, i.e., how certain functions would be transferred from the DCFS to the counties, and the time frames involved. Mr. Peri stated all involved agencies had been asked to provide a detailed accounting and identify the cost estimates of integration, which had resulted in the recommendations included in The Executive Budget.
Senator Rawson indicated that a great deal of effort had been expended on behalf of the concept to integrate child welfare services, and the basic consensus was that integration would be very beneficial to Nevada’s children. Senator Rawson asked Mr. Peri whether he was satisfied with the basic assumptions regarding the funding, i.e., the one-shot appropriations, and whether the figures were realistic. Mr. Peri stated that the LCB’s Fiscal Division staff would like the opportunity to review the issue more closely, based on direction from the subcommittee, as it was felt there were some items which could support a reduction in funding. Per Mr. Peri, staff would like to allow each entity sufficient time to review the information and, at the proper time, staff would make suggestions. Senator Rawson felt the subcommittee should take such action, because the concept of integrating the bifurcated system should begin moving forward. Senator Rawson also noted that the subcommittee had been provided information which he had not yet perused, and inquired whether the labor issues had been reconciled.
Mr. Peri explained there were still some concerns, and at the recent meeting of the Committee on Ways and Means, testimony had been presented by Robert Gagnier, Executive Director, State of Nevada Employees’ Association (SNEA), regarding the association’s position on several outstanding issues. Mr. Gagnier had offered several amendments to the proposed legislation, and Mr. Peri referenced Exhibit D, a letter from Robert Gagnier, Executive Director, and Thomas M. Beatty, Executive Director, to Assemblywoman Barbara Buckley, copies of which had been presented to the subcommittee. Mr. Peri reiterated that not all issues had been resolved. Senator Rawson asked that staff keep deadlines and dates in mind when working toward an appropriate conclusion to the proposal. Chairwoman Giunchigliani felt that the establishment of time lines would be very helpful to the subcommittee; she then asked Stephen Shaw, Administrator, DCFS, DHR, to address the subcommittee.
Mr. Shaw pointed out that integration would dismantle a 50-year-old system, and would present the opportunity for Nevada’s children and families to access services through a single system. Per Mr. Shaw, the Interim Study Committee had done a tremendous amount of work regarding integration, however, there were some remaining issues that should be reviewed. Mr. Shaw said integration was action that had never been undertaken on such a large scale in Nevada, and was also new to the Legislative Branch. According to Mr. Shaw, the issues should be approached with flexibility. The DCFS and Assemblywoman Barbara Buckley, District Eight, Clark County, strongly recommended a non-reverting fund, which had been viewed as problematic by the LCB’s Fiscal Division staff, and the legislature in general. In order to accomplish the integration in a safe and secure manner, and one that also protected children and families, it should be approached without specific deadlines in place. Senator Rawson commented that establishing a time frame in which to assimilate a program was not totally without precedent, and such action could be considered by the legislature.
Mr. Shaw stated he would reference some of the “hot” topics that were as yet unresolved, and pointed out that the DCFS needed to reach an agreement regarding funding formulas with the counties. Every move the DCFS made was in consensus with Washoe and Clark Counties, and the guidelines for the formula were included in A.B. 343, which Mr. Shaw felt should not be much more specific. The three tenets of the formula included:
§ Predictability: The legislature and the Executive Branch, along with the county commissioners, had to achieve some level of comfort regarding the direction of integration;
§ Shared fiscal responsibility: The state, counties, and the federal government should share the costs; and,
§ Incentives for the counties.
According to Mr. Shaw, it was important to note that the formula would be capped by legislative appropriation, as agreed upon by the state and the counties. The formula only pertained to the General Fund allocation, and would contain the percentage share of state funds available in each of the three regions, Clark County, Washoe County, and the rural areas. Funds would be distributed on the basis of the division’s past experience in those regions. Mr. Shaw noted that funds would be partitioned and allocated to the regions in a manner that compensated each region for specific regional disadvantages, such as geography or population density. Continuing, Mr. Shaw stated that each region would be rewarded for best practices within the region, such as use of less restrictive settings, and use of preventive efforts; all federal funds earned by the regions would pass through the DCFS.
Mr. Shaw emphasized that the funding formula had been developed in collaboration with the counties, and the DCFS had agreed on the tenets of the formula, however, the specifics had not yet been developed. The DCFS would ask that all funds be placed and retained in the DCFS’ budget, for allocation to counties after certain benchmarks had been met. Mr. Shaw revealed that some of those benchmarks were negotiable, and would be finalized whenever possible; he noted that there were also some non-negotiable benchmarks. Mr. Shaw explained, for example, the allocation to Clark County for its compliance with the Statewide Automated Child Welfare Information System (SACWIS) would be allocated as benchmarks were achieved and met. According to Mr. Shaw, the counties were required to be in compliance with the SACWIS prior to attaining eligibility for any federal reimbursement. The DCFS was the SACWIS agency in Nevada and had approximately $18 million in uncapped entitlement funding that would be in jeopardy if compliance was not met. The division wanted to move methodically to ensure that the first benchmark was met by Clark County before initiating the transition into integration.
Chairwoman Giunchigliani asked what was the key that triggered federal funding for Clark County. Mr. Shaw stated that Clark County had to be in compliance with SACWIS; Washoe County had been a full partner in the system and had met compliance requirements. Chairwoman Giunchigliani inquired whether it was true that Clark County had been offered the opportunity to achieve compliance several years ago, and declined to do so. Mr. Shaw stated that was prior to his tenure at the DCFS, however, believed the county had been given that opportunity, but had chosen to proceed with its own data system.
Kirby Burgess, Director, Clark County Department of Family and Youth Services, stated that Clark County had initiated an integrated system which captured data, not only for child welfare, but also for juvenile justice. Along the way, the county had worked with the state in terms of conducting an interface to meet certain SACWIS requirements in terms of state reporting information. Mr. Burgess noted that, at the current time, the county had made a commitment to come into compliance with the SACWIS requirements. Chairwoman Giunchigliani inquired whether there was a projected time line for achieving that compliance. Mr. Burgess felt the county could achieve compliance by July 2002 and was currently working with the DCFS in review of all applications, along with the process necessary to accomplish that compliance. Chairwoman Giunchigliani stated she thought the same held true for Child Haven regarding the issue of federal dollars. Mr. Burgess explained that Child Haven was a separate issue, because of its institutional rating.
Mr. Shaw pointed out that the other somewhat controversial issue was the consortium that existed within the bill. Literature supported the community-based model, which was meant to help establish resources for children in need of specialized services, build community partnerships, and forge new collaborations. According to Mr. Shaw, the greatest risk perceived by the legislature was that the DCFS would retain budgetary responsibility and, therefore, also retain a role in the final approval of expenditures. Mr. Shaw was unaware of any language contained in the legislation which would alter that budgetary responsibility. Because of the necessity for higher levels of care in the mental health component, Mr. Shaw did not view that proposal as final; it was simply too large in scope. In the initial stages of integration, however, the DCFS would retain control of the budget. The need might arise for a statutory change or amendment to the proposed legislation that clearly defined the parameters of the budgetary control, along with the limitations on appropriations.
Chairwoman Giunchigliani felt that would provide some measure of comfort to the legislature, and since the concept of integration was still in the evolutionary stages, it was hoped it would eliminate the possibility that a bifurcated system would survive for several more years; she felt benchmarks would definitely be required. Mr. Shaw commented that integration would end one bifurcated system while creating another as the process evolved, and would require continued work over the upcoming biennium.
Mr. Shaw expounded that the idea was to establish several benchmarks, some of which would be non-negotiable. The first non-negotiable benchmark consisted of a renewed cost allocation plan, which dictated how the DCFS would bring federal dollars into the state, and how those dollars would be distributed. Mr. Shaw pointed out that the DCFS had, to date, never been involved with the counties in their delivery system and cost allocation plans. Once the DCFS had a sense of direction from the legislature regarding how far the proposal would proceed over the upcoming biennium, the cost allocation plan could be reconstructed.
The second non-negotiable benchmark was the aforementioned SACWIS compliance in Clark County. According to Mr. Shaw, there were several detailed benchmarks within that broad benchmark, such as federal funding approval, submission of an Implementation Advanced Planned Update to the Administration for Children and Families, and subsequent approval. Mr. Shaw pointed out the necessity of certain hardware and software infrastructure needs, training, and joint application design sessions, et cetera.
The benchmarks that were negotiable with the counties would ensure that counties achieved an acceptable level of performance at each stage of the implementation process, before it could proceed to the next stage, for example:
Mr. Shaw next addressed proposed integration plans and time lines, and noted that Washoe and Clark Counties were using two different approaches: working units in Washoe County, and functions in Clark County. Mr. Shaw noted there could be possible delays in SACWIS compliance.
According to Mr. Shaw, the DCFS had requested an allocation of $262,500 in A.B. 512 to allow the division to hire a project manager. The responsibilities of the position would be totally different from those of a consultant, and the DCFS needed a person with experience in county-based systems, and experience in integrating bifurcated systems, if possible. Mr. Shaw pointed out that the DCFS staff did not have that level of expertise, and the division would request a full‑time position, which would be filled via contract; he emphasized that the position was critical to the success of integration. The duties would include implementation of claiming processes, development of a transition plan, defining the state’s monitoring role, development of detailed benchmarks for the transition, assess objectives, identify opportunities and risk regarding the safety of children, and verify the results of integration at specified intervals.
The proposed cost allocation plan of $150,000 would require renewal if the DCFS was to continue the job of securing federal dollars. Mr. Shaw pointed out that the DCFS currently enjoyed a 70 percent eligibility rate for children eligible for Title IV-E reimbursement, and did not want to see that rate drop drastically because of integration.
Mr. Shaw explained that A.B. 343 called for an oversight legislative committee, and additional work in conjunction with the Governor’s Office would also be necessary. Currently, the DCFS had state-matched Medicaid in its budget, and the question was whether that would continue when the move was made to county-based systems. The counties had strong feelings regarding that issue, and Mr. Shaw did not think it had been resolved. There were certain items in the DCFS budget that were also included in A.B. 343, and that action was taken because the DCFS would require those items in its budget, regardless of action taken on the bill. Consequently, those items had been duplicated, and Mr. Shaw noted that the DCFS would work with the LCB staff in identifying those duplicate items. There had also been items omitted from both the one‑shot allocation and ongoing costs depicted in A.B. 343, i.e., there were licensing positions in the DCFS budget that were built into the operational costs in the bill, primarily because those positions were eliminated from the DCFS budget and the counties failed to pick them up.
Mr. Shaw testified that when the DCFS was formed, the Welfare Division had transferred eligibility staff, as it would determine eligibility for Title IV-E funding and Medicaid. Those positions were tied to Medicaid and would require transfer when integration was resolved. Mr. Shaw felt integration would prove to be a tremendous asset to Nevada’s children and families, and once the benchmarks were established, the DCFS would approach the IFC to report compliance when each benchmark was triggered. Mr. Shaw reminded the subcommittee that the DCFS would ask for a non-reverting fund and some flexibility in the process.
Chairwoman Giunchigliani noted that a substantial allocation was being requested for consultants, transition managers, et cetera, and the legislature did not want to create another bureaucracy. Chairwoman Giunchigliani asked whether an expert existed in the area of integration and transition. Mr. Shaw explained there were two agencies in county-based government that utilized such expertise via private firms, and both firms had expressed an interest in the state’s integration plan. Those firms had the capability to bring in national experts to address the integration process. Mr. Shaw advised, once again, that the DCFS simply did not have the expertise on staff, and did not have the capability to hire an expert. Mr. Shaw pointed out that integration would create a tremendous amount of day-to-day work, in addition to the ordinary business of the DCFS. The minor degree of assistance provided from national consultants had been extremely helpful to date. Chairwoman Giunchigliani noted that there had been a consultant tied to the mental health component regarding severely emotionally disturbed children, and asked for clarification. Mr. Shaw introduced Christa Peterson, Ph.D., Deputy Administrator, DCFS, DHR, who would provide additional information regarding the mental health consultant.
Dr. Peterson explained that the Interim Study Committee created by A.C.R. 53 of the Seventieth Session had heard testimony regarding the unmet needs of severely emotionally disturbed children within the child welfare system, and had recommended that an enhancement be made to the DCFS’s budget to provide services to those children. The 1999 Surgeon General’s report had endorsed a system of care approach for severely emotionally disturbed children, particularly those who were in the public system. Dr. Peterson stated that over the past ten years, the U.S. Department of Health and Human Services had conducted studies to demonstrate that intensive community-based services appeared to be the most effective way to serve those children and achieved the best outcomes. Unfortunately, Dr. Peterson indicated, Nevada’s system and approach to treatment of those children did not include intensive community-based services, because the state simply did not have the infrastructure, the mechanism, or the expertise in place to provide that approach. The DCFS based its expansion of mental health services on the population in the preferred model, but required consultation to establish that model, which also needed to be established on a community-based approach. Dr. Peterson stated the DCFS would need to have consultants in each region work with agency staff and community partners, to ensure that the DCFS could effectuate the approach. Without that type of effort, the agency would not be successful.
Chairwoman Giunchigliani indicated it was her understanding that the state was not yet moving forward with the entire mental health component. Dr. Peterson stated the enhanced services to severely emotionally disturbed children was part of Budget Account 3229, decision unit E-250, and was recommended by the Interim Study Committee created by A.C.R. 53 of the Seventieth Session. Mr. Shaw concurred, and noted that the Interim Study Committee heard testimony that the DCFS was meeting the needs of approximately 30 percent of the child welfare population, leaving a large percentage of children not being adequately served. An allocation of $6 million was placed in The Executive Budget, as recommended by the Interim Study Committee, in order to meet 100 percent of the needs of the child welfare population.
Chairwoman Giunchigliani asked about caseload growth and inflation, and how the DCFS would deal with that issue after the upcoming biennium. Mr. Shaw stated that, conceptually, the relationship between the DCFS and the counties was a full partnership at the present time, and would change to a relationship much like the federal government maintained with state agencies. It was envisioned that the counties would submit budgets to the DCFS, which in turn would submit the budgets to the legislature. Mr. Shaw pointed out that the decisions regarding inflation and caseload growth would be made at the state level through normal channels.
Chairwoman Giunchigliani inquired whether a funding formula existed. Mr. Shaw replied that no formula existed, and there would be no funding formula beyond what existed in NRS. Chairwoman Giunchigliani felt a funding formula would be required; she did appreciate the vision expressed by Mr. Shaw, and the legislature would consider the non-reverting fund. She would not guarantee that the subcommittee would ultimately approve such a fund, and requested additional information before making a decision regarding funding. Chairwoman Giunchigliani stated she would not feel comfortable approving something that was simply a concept. A funding formula was needed in order to have some idea regarding proposed increases, and to anticipate the potential impact on the state. Chairwoman Giunchigliani asked when information regarding benchmarks and suggested time lines would be presented to the legislature. Mr. Shaw stated that information would be presented to the subcommittee within approximately the next one to two weeks.
Senator Rawson noted that, ideally, there would be a transfer of responsibility to the counties with a view toward eliminating state responsibility, which did not necessarily mean the state would no longer be responsible for a portion of the costs. In the state’s basic tax relationship, a certain portion of constituent money was allocated to the state and counties, and what the legislature should consider was a method that would keep the counties “whole” with that constituent source of tax money. Senator Rawson felt, because taxes were a sensitive issue, it was not often discussed, and there would always be room for possible injury to one party in a formula that tried to compensate for all possibilities. If the Governor or legislature were to seriously consider revision of the tax structure, the integration of state and local child welfare systems should be a component of that consideration, with the understanding that the counties would be made “whole” in that review, while simplifying the process and eliminating the need to approach the legislature each session to adjust the formula.
Chairwoman Giunchigliani stated her vision of a funding formula would include anticipation of what might occur regarding caseload projections and inflationary costs, to provide a guideline to the legislature as it moved forward. She felt Senator Rawson was absolutely correct, in that the state did need to revisit the tax structure for possible increases and additional revenues, rather than simply cost-shifting to the local governments, nor should local governments cost-shift to the state. Chairwoman Giunchigliani stated if the integration was to be successful, the state should provide the correct dollar amount.
Ms. Leslie inquired whether the state’s Medicaid plan would be changed to allow for competition in wrap-around mental health services. Mr. Shaw explained that the DCFS did not handle Medicaid; Ms. Leslie emphasized that she wanted to send the message that she would like to see that change occur in Medicaid. Mr. Shaw stated he would pass that message along to the director of the DHR and the Governor, however, such action would not be without costs, and those costs were not currently included in The Executive Budget. Chairwoman Giunchigliani asked for a workup regarding what costs would be involved in such a change.
Ms. Tiffany noted that the DCFS often presented an obstacle to change by indicating that a different population would be served, which would cost additional money, and therefore, would increase the budget. The population she would like to view as the target population would be those who were not Medicaid-eligible, or who could qualify, but were funneled through a single system. Ms. Tiffany indicated it was not that a new population would be served, but rather it might be the same population that qualified for Medicaid. If exorbitant numbers were built into the integration because it was viewed as an entirely new population, the subcommittee would look at those numbers somewhat askance. Mr. Shaw reiterated that Ms. Tiffany was addressing a Medicaid issue, which was not handled by the DCFS.
Mr. Dini commented that he served on the Interim Study Committee and felt there was a good deal of “uncharted water” in the integration process, and it would not be an easy transition. There were some pitfalls and/or costs that could arise. He noted that in years past, the child welfare program had operated in the “red,” and Mr. Shaw had addressed those issues to correct the situation. Mr. Dini pointed out that it would take the cooperation of all parties involved to hold down the costs and ensure that the more difficult child welfare cases were not shifted back to the state, when the state budget was not prepared for such action. The first two years of the integration would be somewhat difficult, and would require the cooperation of all parties involved, or the integration would fail. Mr. Dini noted that Washoe County had proven that such integration worked by initiating other programs that provided better service for the children, which was the purpose of the proposed integration.
Chairwoman Giunchigliani agreed that the bottom line was service for children, however, the legislature wanted to ensure that additional problems were not created as the process was initiated. She was pleased to hear that the state still maintained a partnership with the two local governments. Chairwoman Giunchigliani asked that a representative from Washoe County come forward and provide a brief outline of the implementation plan, explain the “unmet needs” which resulted in the $224,000 increase in cost, and answer the subcommittee’s questions regarding salary and benefits.
Michael Capello, Director, Washoe County Department of Social Services, informed the subcommittee that the county decided to approach the issue of integration from the perspective of attaining the required compliance with the SACWIS as quickly as possible. The children currently being processed through the bifurcated system lost three to six months in terms of case management services via transfer from one agency to the other. Mr. Capello stated Washoe County felt the best way to eliminate that loss would be to serve all children entering the child welfare system as of October 1, 2001, via a non-bifurcated system. According to Mr. Capello, as previously mentioned, the county had been working with the DCFS over the past approximately 18 months to develop a pilot program, which had ultimately been accomplished. The pilot program served approximately 150 children, and the county had realized a reduction in the number of placements and reunification times, with shortened lengths of stays in foster care as a result.
Mr. Capello stated the first step in Phase I of Washoe County’s proposal was to transition a sufficient number of the DCFS staff in the Reno area to the county, in order to accommodate the number of children entering the system; the estimate was that approximately 18.5 FTE positions would be transferred. At the same time, because of that growth, the county’s infrastructure would need to grow somewhat, and Mr. Capello indicated the county had identified two additional new positions it would like to hire to support the effort of receiving additional staff. It was important to note that the staff identified for transfer to the county did not include any central office or policy-making staff currently employed by the DCFS. Mr. Capello stated some functions, such as payroll and accounting, were not being addressed by the transfer of positions to the county, and therefore some infrastructure would be required to accommodate the additional demands.
Continuing, Mr. Capello explained that Phase II of the integration plan would become effective July 1, 2002, and at that time, it would be the county’s intent to transfer the remaining children in the custody of the DCFS to the county, along with accompanying staff. Another program that would transfer to the county in October 2001 was the family preservation component. Essentially, explained Mr. Capello, the county wanted to initiate a transfer of the initial services for new families entering the system to ensure solidification in terms of functions and to provide the required level of services. During the second year, the remaining children and staff in related programs would be transferred to the county, in order to continue working toward meeting the federal Adoption and Safe Families Act (ASFA) requirements for the children currently in the system. According to Mr. Capello, implementation of those two phases comprised the county’s proposal for the upcoming biennium.
In Phase III, which would occur beyond the upcoming biennium, the county would review the number of children being served in foster care, and ensure that staffing was at the proper ratio of 1:28 children. Mr. Capello reported the Washoe County Department of Social Services had been fortunate because the county commissioners had been very generous in funding its programs. In the bifurcated system, Washoe and Clark Counties funded 100 percent of the costs involved in child protective services, and Mr. Capello explained that the figures in Exhibit C, which depicted the amount the county was currently expending in child welfare, were not truly represented. Those figures represented what the cost would be to the counties in assuming the state function, rather than the total amount expended in child welfare services. Per Mr. Capello, in year three of the integration plan, the county would review the actual number of cases and children in the system, with the funding request based on that information and on the need to meet the required 1:28 caseload ratio.
Chairwoman Giunchigliani asked about the additional cost of the unmet needs referenced in Exhibit C. Mr. Capello stated in Phase I there was an unmet need of $888,263; he called attention to the chart contained in the exhibit (page 23), which delineated the summary of new Washoe County costs to transition child welfare services. Column A of that chart defined the general categories. Mr. Capello explained that in the first year of the biennium, the unmet need would be represented by the difference between the amount of money transferred by the state to Washoe County, and the actual cost to the county of $377,678 in the salaries and benefits category.
Chairwoman Giunchigliani inquired whether county staff consisted of social worker positions. Mr. Capello replied in the affirmative, and explained the county had recently undergone a very comprehensive classification and compensation study, conducted by a nationally recognized company, which had basically addressed every position in the county and applied a salary scale. Mr. Capello informed the subcommittee that he would provide information regarding salary cost comparisons. Essentially, he explained, the salary range for a Social Worker III position in state service was $31,550 to $42,762, compared to a Washoe County Social Worker III position with a salary range of $43,368 to $56,389. The salary differential represented the bulk of the difference in terms of dollars the state would transfer to Washoe County.
Chairwoman Giunchigliani stated the integration was being considered based on the best situation for the children involved in the welfare system, but also because it was felt that the counties could do a better job within their own communities. She asked whether the expectation was, that because local governments had established a higher salary range, the state had an ongoing obligation to support that difference. Mr. Capello stated as the county approached integration, the direction from its board of commissioners and the county manager stipulated that the county would not undertake a program that was under-funded and combine it with the county’s well-funded program, the result of which would be a “watered-down” program. The most positive action that could be undertaken for the children would be to provide as many services as possible “up front,” in order to keep them out of foster care, if at all possible, and only place them when their safety was in jeopardy. Mr. Capello explained that principle had been made very clear to the Interim Study Committee in the beginning and, even though it was a willing partner, Washoe County would only participate if the state funded the program at the same level as the county.
Chairwoman Giunchigliani inquired whether the state would still be obligated five years into the program, or was it intended that the funding shift to the counties would be at a set level, and as the program evolved, it would become the responsibility of the local government to absorb the costs. Mr. Capello felt the county’s position was that the state would be responsible for continuing to provide funding for the “back end” of the system. The current formula provided that the counties historically spent 100 percent of their funds on the “front end” of the system, while the state financed the “back end,” and when the services were combined, the county would not be a position to assume the full cost of the combined services. Mr. Capello indicated that identification of the funding formula was part of ongoing negotiations, along with the question of whether there was the possibility that a tax mechanism would be feasible for the county, or whether funding would require a line item in The Executive Budget. The county had been clear in its expectations regarding the base money funding from the state.
Chairwoman Giunchigliani asked for clarification regarding the “back end” of the system. Mr. Capello stated the “back end” was different in Washoe County’s system than it was in Clark County. He explained that Washoe County had five investigation assessment units that conducted all investigations and assessments. There were also two ongoing units, plus the current pilot unit, that provided services to children while they were in foster care for up to approximately six months. If children could not be unified with their families within that time frame, they were transferred to the DCFS. According to Mr. Capello, in Clark County, if a child remained in foster care after the evidentiary or adjudication hearing, they were transferred to the state in a shorter time frame, as Clark County did not have the two ongoing units to provide services while children remained in foster care. Mr. Capello felt Washoe County was already undertaking a piece of what was considered the “back end” of the system in Clark County.
Resuming his testimony regarding the chart contained in Exhibit C, Mr. Capello referenced the figures for Washoe County contract permanency homes, which had been an area of significant discussion during the Interim Study Committee hearings. Washoe County currently paid $44 per day for its contract shelter homes, and the state reimbursement had historically been between $12 and $14; there was a proposal before the legislature to significantly increase that reimbursement. Mr. Capello stated that would account for a portion of the increase, and Washoe County had agreed to reduce its rate from $44 per day for the first 90 days that a child remained in shelter care, to approximately $30 per day on a long-term basis. According to Mr. Capello, the county had enjoyed tremendous success with its foster parent program, because of the $44 per day reimbursement. The salaries and the foster care payment were “big ticket” items in the integration process in terms of the unmet need.
Chairwoman Giunchigliani asked whether the $44 was for the first 90 days of foster care. Mr. Capello stated what the county had proposed was a $44 per day reimbursement during the first 90 days a child was in care, considering that time frame as an assessment period to identify what the child’s needs and issues were, and after that time, the county would consider reduction of the rate to $30 per day. Mr. Capello explained there was a local group working on that issue, and the county might consider a “blended” rate, i.e., split the difference and arrive at a mid-range figure for the total foster care stay. For purposes of budgeting the allocation from the state, the initial figures would be $44 for the first 90 days, which was a 100 percent county expenditure, and $30 after the first 90 days.
Chairwoman Giunchigliani asked what the Governor’s foster care rate proposal was based upon. Electing to respond was Mr. Shaw, who explained the proposal was based on a rate study, which took into consideration the compensation being offered by other entities, along with the amount which would be affordable to the state. The proposed rate constituted a 47 percent increase in foster care reimbursement, which hopefully, would stabilize the state’s system. Currently, Mr. Shaw noted, the state lost 100 percent of its foster parents each year. The children who entered the welfare system often had some very significant issues which required a certain degree of commitment on the part of foster parents beyond the monetary value. Mr. Shaw felt that foster parents should be compensated for their efforts, and The Executive Budget allocation was a significant improvement over the current reimbursement. Chairwoman Giunchigliani asked Mr. Shaw to compile the information for the subcommittee regarding the current rate, the recommendation from the Governor, and the rates paid by Washoe and Clark Counties. Mr. Shaw pointed out that the state utilized its foster homes as the base for adoption, and approximately 60 percent of all adoptions were placed from those homes.
Chairwoman Giunchigliani informed Mr. Capello that the subcommittee would require explanation of the county’s indirect costs, i.e., what those costs supported, et cetera. Some justification would be required for such items as additional attorneys from the Washoe County District Attorney’s Office, in order to identify whether that was an actual state obligation. In the one-time cost category, the request was for Jeep four-wheel drive automobiles, and the question would be why approximately $25,000 each would be expended for those vehicles. Mr. Capello explained the county maintained a pool of various types of vehicles, given its service area and the need to transport children in inclement weather, along with the need to access remote areas on a regular basis during the winter months. According to Mr. Capello, the county studied the positions being transferred in terms of staff to vehicle ratio, which would put the county in a “crunch” regarding its four-wheel drive vehicles. The county did purchase a certain percentage of Jeep four-wheel drive vehicles in order to deal with inclement weather. Mr. Capello felt the county could revisit that issue. Chairwoman Giunchigliani indicated that would be a good idea, because the request was for eight vehicles over the biennium, i.e., four each fiscal year at $25,000 each.
Continuing, Mr. Capello addressed the integration manager concept, and pointed out that the county had surrendered a full-time position to the pilot program, which had remained vacant for the past year. The task of integrating two agencies involved the review of policies, procedures, human resources, facilities and facility management, budget, fiscal, et cetera, and the county currently was working on an integration plan, which consisted of ten subcommittees working in ten different categorical areas. Quite frankly, to complete the integration process in a manner that was not harmful to children and families, Mr. Capello stated the county needed a full-time position that would coordinate the broad array of integration functions to ensure each step was occurring on time and on target. At the same time, the county still had a department to run and had to maintain the day-to-day functions of the agency, and Mr. Capello indicated the county’s budget proposed to fill the position it had surrendered to integration. Chairwoman Giunchigliani asked whether the manager position would be a one‑time cost. Mr. Capello noted that the budget projected the manager position over the three-year integration plan, and at the end of that time frame, the position would be eliminated. According to Mr. Capello, the integration process was extremely complex, and having a competent manager in place would ensure its success.
With no further business to come before the subcommittee, the hearing was adjourned, and Chairwoman Giunchigliani indicated future meetings would be scheduled to deal with the integration process.
Because of time constraints, Dorothy Pomin, Foster Care and Adoption Association of Nevada, and Family-Foster Care Support Advocate, Sierra Association of Foster Families, submitted Exhibit E, an overview of the financial cost of Nevada’s diminishing foster homes, for the subcommittee’s perusal.
Carol Thomsen
Committee Secretary
APPROVED BY:
Assemblywoman Chris Giunchigliani, Chairman
DATE: