MINUTES OF THE meeting
of the
SENATE FINANCE/ASSEMBLY WAYS AND MEANS
SUBCOMMITTEE ON K-12/HUMAN RESOURCES
Seventy-First Session
March 29, 2001
The Subcommittee on Ways and Meanswas called to order at 8:25 a.m. on Thursday, March 29, 2001. Senator Rawson 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.
SENATE COMMITTEE MEMBERS PRESENT:
Senator Raymond Rawson, Chairman
Senator William Raggio
Senator Bob Coffin
Senator Bernice Mathews
ASSEMBLY COMMITTEE MEMBERS PRESENT:
Ms. Chris Giunchigliani, Chairwoman
Mrs. Barbara Cegavske
Mr. Joseph Dini, Jr.
Mr. David Goldwater
Ms. Sheila Leslie
Ms. Sandra Tiffany
COMMITTEE MEMBERS ABSENT:
None
STAFF MEMBERS PRESENT:
Mark Stevens, Fiscal Analyst
Steve Abba, Principal Deputy Fiscal Analyst
Robert Guernsey, Principal Deputy Fiscal Analyst
Bob Atkinson, Program Analyst
Georgia Rohrs, Program Analyst
Larry Peri, Senior Program Analyst
Andrea Carothers, Committee Secretary
Senator Rawson stated that the meeting was a work session to review information issues that would need to be resolved before the Department of Human Resources’ budgets could be closed by the joint subcommittee. Before reviewing the various budget issues Senator Rawson requested the subcommittee be brought up to date on the potential reduction in General Fund revenues as projected by the Economic Forum. He recognized Mark Stevens, Assembly Fiscal Analyst.
Mr. Stevens stated that his testimony was not a revenue projection by the fiscal division, and the revenue projection was currently being completed. In order to enlighten the committee regarding the potential budget shortfall, the division had taken one scenario and costed it out to glean the impact. He reiterated that he would not be discussing the Fiscal Analysis Division’s revenue projection, but would be giving the committee an approximate idea of the budget shortfall.
Mr. Stevens stated that currently there were seven months of sales tax collections in FY2001, and there was a 5.1 percent increase over the seven‑month period. The Economic Forum projected sales tax revenues would increase 5.9 percent in FY2001. Mr. Stevens noted that there were two impacts in sales tax. State General Fund Revenues received a 2 percent sales tax collection, and the Distributive School Account (DSA) received a 2.25 percent local school support tax. He stated that on gaming percentage fees there were eight months of collections in FY2001, and the collections were at a negative 2.3 percent in comparison to the same eight months of last year. The Economic Forum projected a 5.9 percent increase in gaming percentage fees for the current fiscal year, much higher than the actual numbers.
Mr. Stevens stated that the scenario that the Fiscal Analysis Division had prepared for the committee had sales tax collection at 5 percent for FY2001. The impact on the General Fund for FY2001, under the scenario, would be approximately $5.7 million. The impact on the DSA would be approximately $6 million. For percentage fees the scenario projected zero percent for FY2001. If gaming percentage fees were flat there would be an impact of approximately $33 million from amount projected by the Economic Forum for FY2001. This would create a $44.7 million budget shortfall in General Fund revenues and the DSA in FY2001. This shortfall would impact funds available for one-shot appropriations that were recommended in The Executive Budget. Mr. Stevens stated that if the Economic Forum did not change the growth rate assumptions made in December for sales tax and gaming percentage fees and just retained them at the levels projected in December, which was a 6 percent increase for sales tax in the first year and 5.5 percent for the second year, and 4.7 percent increase and 4 percent increase for gaming percentage fees, and FY2001 was rebased for 5 percent increase for sales tax and flat growth for gaming percentage fees, the impact would be approximately negative $47 million in the first year of the biennium and approximately negative $49 million in the second year of the biennium.
Senator Rawson indicated a hope that the Economic Forum would not change the growth rate, but acknowledged that this change would likely take place. He stated that Mr. Stevens was giving the committee a “conservative cut.” Mr. Stevens stated that this was correct, and noted that if the Economic Forum decreased the growth rates the impact would be greater.
Senator Rawson asked staff to work with the agencies, whose budgets were being heard today, to create a priority listing of all the proposed new positions. He noted that the Governor would be presenting recommendations, and the committee would wait for those recommendations, but a priority list needed to be developed.
Department of Human Resources Director’s Office
In reference to the Department of Human Resources (DHR) Administration budget, Senator Rawson stated that the budget recommended $1.8 million in one-time General Fund appropriations for the development of a long-term strategic plan for the current and future health care needs of Nevada citizens. Senator Rawson requested a breakdown of the one-time appropriation to allow the committee to examine all elements of the appropriation, and asked staff to work with the agency.
Ms. Giunchigliani asked for further discussion regarding the proposed strategic plan. Senator Rawson indicated that if the committee had all the information regarding the strategic plan they would be better equipped to make a decision.
Ms. Shelia Leslie indicated that the $1.8 million was state money, and the strategic plan cost a total of $2.4 million. She asked to have the requested breakdown include all the monies involved.
Senator Rawson stated that in the Healthy Nevada Fund budget, a decision needed to be made in regards to decision unit E-250, the transfer of the programs for the reduction of tobacco use and for health improvements for children and the disabled to the recommended Grants Management Unit budget. He asked staff to examine the governance of the task force, and stated that the legislature had typically had governance that rotated between the Assembly and Senate. Senator Rawson recommended using language to ensure the rotation in this matter.
In the Family to Family Connection budget, Senator Rawson requested either staff or the agency to develop a sliding fee scale. He noted that Senator Valerie Wiener, Clark County SenatorialDistrict 3, had requested that seniors be included. The Family to Family offices would serve as a one-stop location for families of any age to access services. Senator Rawson stated that the committee had previously inquired as to whether Temporary Assistance to Needy Families (TANF) dollars could be utilized in this budget. He asked staff to peruse this matter, and noted that TANF dollars could not be used to replace all General Fund dollars.
Ms. Leslie stated that she continued to have reservations in relation to the proposal of the new administrative structure of the Family to Family Connection Program. She noted that the agency had discussed placing the new administration in the local governing boards of the Family Resource Centers, of which there was currently one in the north and one in the south, and allowing them to charge 15 percent as an administrative overhead. She asked if there was not another administrative structure that could save money. Ms. Leslie stated that the saved money could be used to fund programs. She noted her objection to placing the Family to Family administration in the Family Resource Centers’ governing boards. Senator Rawson stated that the guiding force for the decision should be what services could be maintained and not other factors.
Ms. Giunchigliani stated that if the committee decided not to complete the transfer to the Grants Management Unit there might be some augmentation that might be possible without impacting the General Fund. She explained that as the issue of the TANF dollars was explored some of the General Fund monies might be restored because there would not be the administrative costs. Ms. Giunchigliani asked staff to look at a way the agency could be restructured if the Grant Management Unit transfer was not completed.
Senator Rawson continued with the Grants Management Unit budget. He stated that if there were capable grant managers and writers the agency would operate more efficiently. He asked to have staff prepare decision units regarding how the services could be maintained, while effectively using the funding.
Division of Child and Family Services
In the Youth Community Services (Child Welfare) budget decision unit M-225 recommended the replacement of $250,000 of General Fund with TANF revenue. Senator Rawson opined that the amount could be doubled. He acknowledged the concern about whether reporting requirements could be met, and whether Division of Child and Family Services (DCFS) could manage the change, but stated that if the additional TANF dollars were not budgeted then the change would not occur. He stated that the Division of Mental Health and Developmental Services had been successful in using the TANF dollars.
Senator Rawson noted that in the Child Care Services budget there was a proposed seven new full-time equivalent (FTE) positions.
Ms. Giunchigliani indicated her agreement with doubling the TANF dollar amount for the Youth Community Services budget, and said the DCFS was a creative agency and could be more creative.
Senator Rawson continued with the Youth Community Services budget, and said there were a number of issues from the A.C.R. 53 of the Seventieth Session that created the Interim Subcommittee to Study the Integration of State and Local Child Welfare Systems in Nevada. He explained that the committee had information regarding the current cost of the state caring for the children, and what Clark and Washoe Counties stated it would cost them to care for the children. There was a gap between the two, and Senator Rawson requested that the staff look at the decision units related to the gap. He noted that the subcommittee did not plan to give the counties an unfunded mandate, but the state was not planning to pay any given amount. He noted that there was a firm commitment to the transfer of certain child welfare services to the counties, and asked for some decision units concerning the matter. Senator Rawson suggested that this matter be discussed in a special meeting of the Assembly Ways and Means/Senate Finance Joint Subcommittee on K‑12/Human Resources.
Senator Rawson stated that the Victims of Domestic Violence budget would not be used for administrative services. He did not mean that the budget would not be funded, but it did not need to be funded in the proposed manner.
In the Southern Nevada Child and Adolescent Services budget there were several proposed new positions in the budget that would need to be examined. There was also a question regarding the nursing standards and accreditation, and Senator Rawson asked the staff to address this question in the decision units.
Ms. Giunchigliani asked if a contract could be considered for the agency’s Family Learning Homes (Oasis Homes). She noted that one Oasis Home had mold problems, and the others were not being properly utilized. Senator Rawson noted that the Oasis Homes were a continuing problem, and said there should either be a plan to fix the homes, or these services should be contracted out.
Ms. Giunchigliani inquired as to the change in TANF rules that no longer allowed support of juvenile justice expenditures in the Youth Parole Services budget. She asked to have clarification on that matter. Senator Rawson stated that if the rule was local than the committee should deal with it.
In the Youth Alternative Placement budget there was a proposal for operating funds for a new 24-bed female juvenile facility at the China Spring Youth Camp, and Ms. Giunchigliani asked if Caliente Youth Center might be a more appropriate place for the beds if the females were from the southern portion of the state.
Welfare Division
Senator Rawson stated that he could not argue with the long-term migration of Nevada Operations Multi-Automated Data System (NOMADS) from the mainframe, located in the Welfare Administration budget. He stated that this was an issue that needed further review.
In the Welfare Field Services budget, Senator Rawson recommended phasing in the recommended changes in the second year of the biennium. He noted that he did not want to cut decision units that the committee found important, but wanted to find alternate ways to stage the changes in order to save money. Ms. Leslie stated that although she was in favor of the initiatives in the budget, Senator Rawson made a valid point. Senator Rawson asked staff to prepare decision units about this issue.
Senator Rawson said that the committee had not received final recommendation on the High Performance Bonus. Steve Abba, deputy fiscal analyst, stated that he had met with Michael Willden, Administrator, Welfare Division, and his staff, about the High Performance Bonus. Mr. Abba believed that there would be additional correspondence with the department concerning the division’s wishes to use the money to reinitiate the On-line Automation Self-Sufficiency Information System (OASIS), which dealt with the training and employment component that was not built into the NOMADS. The division had provided preliminary information on how the one-time performance money would be used, but Mr. Abba would need to work with them to refine the numbers. Mr. Abba’s understanding was that a formal letter would be received, requesting that the money be budgeted in FY2002. He noted that the funding for the OASIS project went hand in hand with the NOMADS migration issue. The plan that would be submitted by the division would use some of the High Performance Bonus to fund server support to migrate some of the NOMADS applications off the mainframe. This would permit the District Attorneys to query off of the servers. Senator Rawson stated that the best use needed to be made out of all monies. He noted that if the subcommittee did not have all the information in time for the closing of budgets the subcommittee would need to make the best possible choice. He reiterated that the requested information needed to be presented to the subcommittee in a timely manner.
Ms. Giunchigliani stated that there was some concern about the new initiatives to prevent and reduce out-of-wedlock births. She stated that in earlier meetings some directive had been given about an alternative way to utilize those monies, rather than entering into a new initiative. She stated that by implementing this program through the Family to Family program or Family Resource Centers the goals could be accomplished, but some of the funding could be better utilized.
In reference to the Child Support Enforcement Program budget, Senator Rawson stated that there needed to be legislation to implement the recommended budget. He mentioned that A.B. 69, which imposed a surcharge on the payment of child support collected by district attorneys to be used for programs for mentoring of children, was a vehicle that could be used, but the committee should not lose track of this issue.
Senator Rawson explained that there was an understatement in the Employment and Training budget, in the sum of $4.2 million. He asked if the committee would need to consider increasing eligibility or provider rates for young children. Ms. Giunchigliani stated that one idea was expanding the program eligibility to 85 percent, up from 75 percent. Another was to expand the number of eligible children, or to have a sliding fee scale.
Senator Rawson asked if the money was expected to be one-time funds. Ms. Giunchigliani stated that the understanding was that this was one-time money. Senator Rawson explained that this money should be placed into areas where there would be no significant problems in removing it. He asked for staff to create a list of the best use of the money.
Division of Health Care Financing and Policy
Senator Rawson stated that the Division of Health Care Financing and Policy budget needed to be “beefed up.” There needed to be a priority list for the requested new positions. He explained that throughout the division there would be the elimination of 13 positions, but the implementation of 26 new positions, for a net increase of 13 positions. Senator Rawson noted that with the elimination of positions, the services would be contracted out, and did not result in a net savings. There would be no dollar-to-dollar savings.
Ms. Sandra Tiffany stated that she was cautious about the transitioning of NOMADS, bringing on the Medicaid Management Information System (MMIS), and looking at the OASIS because they were all within one division. She stated that these projects were very large, and she was unsure if all three needed to be taken on in one biennium in one division. Ms. Tiffany asked to have staff inform the committee about which projects made the most sense. She gave the example of the fact that NOMADS was becoming operational, and there were proposals to change it. Senator Rawson stated that he believed that the division was not satisfied with NOMADS. Ms. Tiffany stated that “satisfied” was one issue, and “functionality” was another. In her opinion the MMIS was a top priority. She reiterated her feelings of caution about working with large computer programs in the same division.
Ms. Giunchigliani clarified that NOMADS and OASIS were in the Welfare Division, and the MMIS was in the Division of Health Care Financing and Policy. She opined that development of the MMIS was necessary. The Value Purchasing model needed to be discussed, stated Ms. Giunchigliani, because there was not the dollar-to-dollar savings the committee needed to examine whether this should be phased in at the current time or whether a better planning phase was needed. Ms. Giunchigliani expressed her thanks to Mr. Charles Duarte, Medicaid Administrator, Division of Health Care Financing and Policy, and her opinion that he had done a good job.
In the Medicaid budget there was $79 million in state funds for costs related to caseload increases. Senator Rawson stated there were some issues with caseload projections. Mr. Abba stated that the division was currently working on the Medicaid payment projection (MPP) model, which was utilized to project payments for medical claims. One of the important components of the model was to input the latest caseload projections. The Division of Health Care Financing and Policy, and Welfare Division were working on their caseload projections. Mr. Abba noted there were some problems determining actual caseloads based upon the Medicaid system. Once the information was cleansed that information would be imputed into the projection model. Mr. Abba stated that if the division could get the revised budget to him once the assumptions were done it would be helpful. This information would be needed in the next two to three weeks in order to complete meaningful analysis of the information before budget closing recommendations were developed.
Senator Rawson stated that the committee decisions were going to be arbitrary if there was no information available from the agency. He explained that the division was eliminating 13 positions, 11 of which were filled nurse positions. He stated that some of those positions could be transferred, and asked staff to explain what would occur to those positions that were eliminated. Senator Rawson also asked the staff to look at a phase in of fee increases.
Ms. Giunchigliani stated that in this budget the title “discretionary rate increases” was a correct title. She noted that there was flexibility in this budget and requested staff to double-check that all the desired groups were included.
Senator Rawson stated that he would not speak on the individual enhancements for this budget at the present time, but they all needed to be examined. The request for the assets test for the Child Health Assurance Program (CHAP) was projected to cost $8.7 million, and Senator Rawson asked about the potential phase in of the recommendation in the second year of the biennium. Senator Rawson stated that all of these enhancements had been fought for, and would be unpopular ones to change, but the subcommittee would need to proceed as wisely as possible.
The Nevada Check-Up Program budget had previously been budgeted at a certain amount but had been allowed to overspend if necessary. Senator Rawson stated that this had been hard fought for, and the subcommittee should look at it carefully to see if similar mechanisms could be used for the upcoming biennium.
In regard to the Intergovernmental Transfer Program budget, Senator Rawson indicated that there was $300,000 that needed to be restored and the counties had requested $500,000.
Division of Mental Health and Developmental Services
Senator Rawson stated there were a number of questions concerning the Division’s Administration budget. He stated that suicide prevention was important, and the Psychiatric Residency Program could use increased support. Opportunity Village could also use increased support. Senator Rawson indicated a need for decision units on this matter.
Senator Rawson noted that in the Nevada Mental Health Institute budget there was staff for 50 inpatient beds plus partial staff for a 10-bed Psychiatric Emergency Services (PES) program, and inquired as to the phasing in of this decision unit. He stated that the proposal also added 12 intensive supported living arrangement (ISLA) beds, and noted that these services could be examined for phasing in over the biennium. Senator Rawson indicated his understanding for the need of these beds.
In the Rural Clinics budget there appeared to be a great deal of input, according to Senator Rawson. He noted that the rural areas needed support and asked for a priority listing.
Mr. Joseph Dini stated that he was concerned about having the Las Vegas Mental Health Center and Rural Clinics funded completely from increased revenues. Rural clinics collected a higher percentage of insurance claims, and if the committee was relying on increased revenue from collections the rural clinics might be adversely affected. Senator Rawson asked staff to be aware of this issue.
The MOJAVE program in the Southern Nevada Adult Mental Services budget had raised numerous questions, noted Senator Rawson. Ms. Giunchigliani asked that staff look at creating separate line items in the budgets that included MOJAVE expenditures.
Senator Rawson indicated that there was no rate increase for the residential community training centers and day training centers in the Developmental Services budgets. Senator Rawson stated that there had been compelling testimony regarding this issue, and the committee was not able to add numerous items to The Executive Budget. He asked staff to prepare a decision unit with a 1 percent rate increase the first year and a 2 percent the second year.
Aging Services
Senator Rawson stated that one of the issues in the Aging Services Grants budget was the appropriateness of utilizing Tobacco Settlement monies to finance administrative positions. Senator Rawson stated felt that Tobacco Settlement funds should be used to finance positions that provided direct services to clients.
Health Division
The Health Facilities Hospital Licensing budget, Senator Rawson indicated, would need more money. It was unknown whether it would come as a rate increase or from another area, but there needed to be a report on that issue.
Senator Rawson stated that in regard to the Special Children’s Clinic budget he had concerns about the elimination of the 10.5 FTE Public Service Interns.
Ms. Giunchigliani indicated her agreement to Senator Rawson’s comments on the Health Facilities Hospital Licensing budget, but noted there needed to be more information from the division.
Senator Rawson asked for a decision unit regarding the Special Children’s Clinic budget.
Human Resources Administration
Ms. Leslie asked to return to the Family Resource Centers budget. The $500,000 one-time appropriation and the name change from the Family Resources Program to the Office of Family and Children was new to Ms. Leslie. She requested additional information on both items.
Ms. Giunchigliani agreed that there needed to be additional information on the $500,000 recommended. She stated that this could be a potential area for funding other areas of the budget.
Division of Mental Health and Developmental Services
Mrs. Barbara Cegavske asked for clarification regarding the Family Preservation Program budget. She inquired as to where the 112 children that were being transferred to the Welfare TANF caseload were being transferred from.
Mr. Bob Guernsey, Principal Deputy Fiscal Analyst, stated that the 112 cases were active cases currently handled by Mental Health and Developmental Services. These clients had been identified as meeting the criteria of TANF funding. Mr. Gurnsey stated that in TANF up to $350 per month per individual was being paid. This was the reason the budget needed to be adjusted. There would be no individuals losing the benefits, the cases would be moved to a separate funding source.
Senator Rawson stated this was a technical correction to ensure that there was a balanced budget.
Senator Rawson noted that this had been a quick overview of the budgets, and gave the staff broad authority to receive the information needed to prepare closing sheets. He stated that there was a general sense regarding the decision points, but the committee was not closed to input. He reiterated that the emphasis should be what services could be preserved, what caseloads could be diminished, and what could be done to have the beneficial effects of programs survive.
Senator Rawson adjourned the meeting at 9:17 a.m.
RESPECTFULLY SUBMITTED:
Andrea Carothers
Committee Secretary
APPROVED BY:
Senator Raymond Rawson, Chairman
DATE: