MINUTES OF THE MEETING
ON PUBLIC SAFETY/NATURAL RESOURCES/TRANSPORTATION
OF THE SENATE COMMITTEE ON FINANCE
AND THE
ASSEMBLY COMMITTEE ON WAYS AND MEANS
Seventy-First Session
April 19, 2001
The Joint Subcommittee on Public Safety/Natural Resources/Transportation of the Senate Committee on Finance and the Assembly Committee on Ways and Means was called to order by Chairman David R. Parks at 8:24 a.m., on Thursday, April 19, 2001, in Room 2134 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
ASSEMBLY COMMITTEE MEMBERS PRESENT:
Mr. David R. Parks, Chairman
Mr. Bob Beers
Mrs. Vonne S. Chowning
Mrs. Marcia de Braga
Mr. John W. Marvel
Mr. Richard D. Perkins
SENATE COMMITTEE MEMBERS PRESENT:
Senator Lawrence E. Jacobsen, Chairman
Senator William R. O’Donnell
Senator Joseph M. Neal Jr.
STAFF MEMBERS PRESENT:
Gary L. Ghiggeri, Senate Fiscal Analyst
Steve Abba, Principal Deputy Fiscal Analyst
Mark Krmpotic, Program Analyst
ElizaBeth Root, Committee Secretary
OTHERS PRESENT:
Tom Tatro, Fiscal Manager, Management Services and Programs Division, Department of Motor Vehicles and Public Safety
Donna West, Administrator, Field Services Division, Department of Motor Vehicles and Public Safety
Ralph Felices, Acting Administrator, Compliance Enforcement Division, Department of Motor Vehicle and Public Safety
Virginia Lewis, Deputy Director, Motor Vehicles, Department of Motor Vehicles and Public Safety
Jim Parsons, Environmental Management Specialist, Chairman, Advisory Committee for the Control of Vehicle Emissions, Compliance Enforcement Division, Department of Motor Vehicles and Public Safety
Dana Mathiesen, Administrator, Central Services and Records Division, Department of Motor Vehicles and Public Safety
Chairman Parks:
We will proceed with the first item on Closing List #4 (Exhibit C).
DEPARTMENT OF MOTOR VEHICLES
DMV, Compliance Enforcement – Budget Page DMV-7 (Volume 3)
Budget Account 201-4740
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit C, page 2.)
Staff recommends the following adjustments:
1. Decreasing the adjusted base by $21,053 in each year of the biennium for decreases in in-state travel, operating supplies, insurance, vehicle operations and uniform expenses based on the transfer of inspectors and appraisers to the Field Services budget account effective February 2000. Staff recommends increases to the Field Services budget account to annualize these support expenses for the transferred positions.
2. Moving fingerprint expenses of $14,040 from the operating category to a special use category designated to identify fingerprint expenses.
3. Adjusting module M-100 for changes to adjusted base.
4. Increasing intra-agency allocations from the pollution control account by $2,161 in Fiscal Year (FY) 2002 and decreasing State Highway Fund by the same amounts in module M-301 to reflect support for one-third of the salary and fringe expense for two positions transferred by the 1999 Legislature for the Account for the Management of Air Quality (pollution control account).
5. Decreasing network hookups, software, and hardware expenses in module E‑276 based on recommended amounts from the Department of Information Technology (DoIT) and revised estimates from the Purchasing Division.
6. Decreasing expenses in module E-710 for two vehicles, and changes in cost for software and hardware. Staff will reflect an adjustment to the Field Services account for these vehicles.
7. Decreasing computer hardware costs in module E-720 based on revised calculations provided by the agency.
8. Changing the category designation for the intra-agency cost allocation proposed in decision unit E-801 to better identify expenses associated with the allocation.
Committee staff has identified the following decision items:
1. The Governor has submitted an amendment to this budget account to increase fingerprint expenses by $25,233 with increased funding from the State Highway Fund. Backup information to the amendment provided by the agency indicates that fingerprint charges were improperly charged to the operating and equipment categories where the department determined there was available authority. The additional amount of $25,233 represents fingerprint expenses charged to the equipment category in FY 2000, which were not recommended as a continuing expense. If the subcommittee wishes to approve this amendment it may wish to express through a Letter of Intent their concern over this practice and the subcommittee’s intent that the department adhere to Nevada Revised Statutes (NRS) 353. Does the subcommittee wish to increase the fingerprint category by $25,233 with funding from the State Highway Fund as recommended by the Governor?
Senator Jacobsen:
It does seem irregular that fingerprint expense would be charged to the equipment category. I would like to hear from the agency whether staff thought they had authority to do this and how this transpired.
Tom Tatro, Fiscal Manager, Management Services and Programs Division, Department of Motor Vehicles and Public Safety:
At the closing of FY 2000, we had expenses that exceeded our authority in the special category for fingerprinting charges to pay to the criminal history repository for fingerprints for licensing dealers. We had an employee who incorrectly coded these. Instead of doing a work program, we billed to other categories and we recognize that error. It is not a practice that we will continue.
Senator Jacobsen:
So, you do not plan on continuing this practice. I am concerned because it is very difficult for committee staff and those on the Interim Finance Committee (IFC) to track these matters when they are consolidated and not properly segregated in historical categories.
Mr. Tatro:
You are correct, and we agree completely. We do not intend to do that again, unless it is an oversight or a mistake. We will be very deliberate about paying from the correct category.
Senator Jacobsen:
From what you indicate, then, a Letter of Intent is not a necessity. If it should happen again I hope you would come to interim finance and abide by the proper procedure.
Mr. Tatro:
Yes, Sir.
Mr. Krmpotic:
The next major decision before the subcommittee is decision module E-276 for $132,168 in FY 2002 and $93,774 in FY 2003. This decision unit recommends two non‑sworn compliance investigator positions and support costs to conduct audits and inspections of driving under the influence (DUI), Traffic Safety, and Commercial Driver’s License (CDL) schools throughout the state. In their testimony before the subcommittee, the department indicated the addition of these positions would provide a consistent and coordinated approach to regulating driving schools and that drive examiners would no longer be required to leave the field offices to conduct the audits, thus increasing their availability to conduct drive tests. The department also indicated to the subcommittee that the positions would audit approximately 86 schools each year and, barring any changes in legislation, this number would remain consistent over the 2001-2003 biennium. Does the subcommittee wish to approve the recommendation to add two positions to audit traffic safety and driving schools?
Mrs. Chowning:
We are told there is an extensive wait for people to get these tests, and therefore, they are not able to get to work as they wish to do, and we wish them to do. Will there be a great benefit in cutting down that waiting time by approving one or both of these positions? Also, were these on the priority list of the Department of Motor Vehicles and Public Safety (DMV&PS)?
As you know, Mr. Chairman, we are faced with a terrible dilemma that we have to cut millions of dollars from the budget so we have asked all of the agencies to prioritize positions.
Mr. Krmpotic:
I would point out that these positions are recommended to be funded from the Highway Fund. I do not believe the department had submitted a priority list. The department has indicated that adding these positions and allowing the examiners to conduct more drive tests may help the situation. I do not know the degree that it would help.
Donna West, Administrator, Field Services Division, Department of Motor Vehicles and Public Safety:
Staff is correct. We will be able to improve our drive tests and reduce wait time. For example, we currently have a 9 to 10 week wait for commercial driver’s license in southern Nevada. We currently have a few vacancies. We are training staff and then we are going to be conducting some more driver’s licensing drive examination training to have more of our examiners trained to assist with commercial driver’s licensing. We do have backlogs in drive tests and we do need to keep our examiner staff in the offices. It is more appropriate to have staff from the Compliance Enforcement Division assist with the schools. They are able to spend more time and focus more appropriately on the issues with the schools then are examiners who have other pressing duties.
Mrs. Chowning:
What do you perceive will happen? With the allocation of these two new positions, do you perceive wait times will be reduced from the current 9 to 10 weeks?
Ms. West:
For CDL, our goal is to try to get the wait time down to 3 to 4 weeks. We are also going to continue looking at finding a way to bring on more third party certifiers. Currently, employers can help certify their own employees for commercial driver’s licenses. We would like to expand that and possibly look at some of the schools that train drivers. But, obviously, if we are going to have a system in place, by which a school can collect a fee, train someone and then certify them to drive, we are going to need the assistance from people in the Compliance Enforcement Division to closely audit those schools to make sure there are no abuses of the system. That is something we would hope to do, but we really need these two positions in the Compliance Enforcement Division funded and filled before we are able to pursue that option. It will help customers who drive trucks and buses to obtain licenses faster.
Senator Jacobsen:
Would it be better to have two sworn officers for these two positions?
Ralph Felices, Acting Administrator, Compliance Enforcement Division, Department of Motor Vehicles and Public Safety:
The regulation of these schools is mostly through the Nevada Administrative Code (NAC). As such, the frequency of criminal conduct is extremely low. We do not think it necessary to bring investigators on with law enforcement powers for that purpose. That is why we requested them in a non-law enforcement capacity.
Mr. Krmpotic:
The last major item I would point out to the subcommittee would be that staff seeks approval to make changes to the cost allocations in E-800, E-801 and E-903 based on final approval of the budgets for the Public Safety Technology Division, Administrative Services Division, and Director’s office.
ASSEMBLYWOMAN CHOWNING MOVED TO CLOSE BUDGET ACCOUNT 201-4740 AS RECOMMENDED BY STAFF, INCLUDING THE ADJUSTMENT IN DECISION ITEM 1 (EXHIBIT C PAGE 2), INCLUDING THE LETTER OF INTENT, INCLUDING THE TWO POSITIONS IN DECISION MODULE E-276, AND INCLUDING THE CHANGES TO THE COST ALLOCATIONS.
ASSEMBLYMAN MARVEL SECONDED THE MOTION.
Senator Neal:
What is the Letter of Intent?
Mr. Krmpotic:
The Letter of Intent is to express the subcommittee’s concern over the department’s having charged fingerprint expenses to equipment and operating categories without approval of the Interim Finance Committee (IFC). It also expresses the subcommittee’s intent that the department pursue IFC approval in the future.
Senator Neal:
If it is not supposed to be done, why are we letting it go through?
Senator O’Donnell:
They apologized, explained their error, and promised not to let the practice continue in the future. So, why give them a Letter of Intent under these circumstances. It is a waste of money and time.
Mr. Chairman, I would like to amend the motion to concur with Assemblywoman Chowning’s recommendations, but I am not sure we need a Letter of Intent. Staff takes time to write those letters. Mr. Tatro vowed this practice would be discontinued and apologized, so I do not feel that aspect of the motion is necessary.
Again, for clarity, my motion would be to concur with Assemblywoman Chowning in her motion; however, eliminating the Letter of Intent.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 201-4740 AS RECOMMENDED BY THE GOVERNOR SUBJECT TO STAFF ADJUSTMENTS AND APPROVAL OF DECISION ITEM 1 (EXHIBIT C, PAGE 2), INCLUDING THE TWO POSITIONS IN DECISION MODULE E-276 AND INCLUDING THE CHANGES TO THE COST ALLOCATIONS.
ASSEMBLYMAN BEERS SECONDED THE MOTION.
Chairman Parks:
Further questions. We have an amended motion by Senator O’Donnell and a second by Assemblyman Beers. What is the subcommittee’s pleasure?
THE MOTION CARRIED. (ASSEMBLYMAN PERKINS WAS ABSENT FOR THE VOTE.)
* * * * *
DMV, Management Services – Budget Page DMV-29 (Volume 3)
Budget Account 201-4742
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit C, page 13.)
Staff recommends the following technical adjustments:
1. Base adjustments in reimbursements of $80,803 with corresponding decreases in State Highway Fund appropriations each year. The adjustment to revenues reflects the statutory requirement (Senate Bill (S.B.) 209 of the Seventieth Session) that the department collect a fee for each temporary placard issued by a seller or long‑term lessor, not to exceed the cost of producing the temporary placard. The department expended $95,100 on temporary placards in FY 2000 and collected $14,297 in revenues. This adjustment matches revenue to expenditures.
SENATE BILL 209 OF THE SEVENTIETH SESSION: Requires temporary placard for use in place of license plate to be provided to buyer or lessee by certain sellers and lessors of vehicles. (BDR 43-197)
2. Moving the cost to print temporary placards of $95,100 each year from category 19 (registration printing) to a separate category to more easily compare expenses to revenues.
3. Adjusting the base in the intra-agency cost allocation based on revised calculations and additional information supplied by the agency on December 20, 2000.
4. Adjusting the base in non-holiday overtime for overtime incurred during Project Genesis “Go-Live” based on information supplied by the agency on December 20, 2000.
5. Reducing operating supplies by $53,292 each year for printer ribbons based on revised calculations presented by the agency regarding usage.
6. Increasing the base in insurance by $527 each year based on revised calculations by staff.
7. Increasing module M-100 by $43 in FY 2002 and $41 in FY 2003 based on revised calculations for employee bond and tort expenses.
8. Increasing module M-301 for intra-agency cost allocations by $32,802 in FY 2002 and $49,173 in FY 2003 based on cost-of-living increases and fringe changes for positions in which costs are allocated to the pollution control account and the Verification of Insurance account. The indicated increases result in decreases to the State Highway Funds by the same amount.
9. Increasing module M-302 for intra-agency cost allocations by $5,137 in FY 2002 and $5,161 in FY 2003 based on a special pay increase for the engineer position allocated to the pollution control account.
10. Adjusting decision module E-225 to establish reimbursement revenue for estimated demographic increases to dealer placards by $3,614 in FY 2002 and $6,943 in FY 2003. Staff also recommends changes to reflect expense increases by general ledger.
11. Adjusting module E-276 by $90 in FY 2002 and $91 in FY 2003 for revised calculations to insurance expense for new positions.
12. Decreasing software and hardware expenses in module E-710 by $213,847 in FY 2002 and $211,096 in FY 2003 based on revised prices from state purchasing for desktop and notebook computers and software. Software expenses in the budget include Norton Anti-virus and Microsoft Windows Networking (NT). Norton Anti-virus is included in the cost of the personal computers (PCs) based on approval by the IFC in September and December 2000.
13. Decreasing module E-711 by $1,885 in FY 2002 for revised estimates in the prices for laptop computers. Staff also recommends moving computer hardware and software expenses to category 26.
14. Adjusting the base to reduce State Highway Funds in FY 2002 by $458,130. The Governor initially recommended an increase in State Highway Fund appropriations to fund the increase in photo license costs based on the conversion to digitized photo licenses in FY 2002. The department has indicated, through an amendment recommended by the Governor, that additional State Highway Funds should be eliminated in FY 2002 since the department will not begin issuing digitized photo licenses until April 2002.
Staff asks the subcommittee to consider technical adjustment item 14 (Exhibit C, page 14) with decision item 1 on the same page.
Staff have identified the following decision items: The Executive Budget recommends increases in category 20, photo licenses, in adjusted base of $610,840 each year based on the increase in the cost per photo associated with implementation of digitized photo license technology. Full implementation of digitized photo licensing is planned for April 1, 2002. To address the delayed implementation of photo licensing, the Governor has recommended an amendment to reduce State Highway Funds in FY 2002 by $409,782 and increase highway funds by $169,431 in FY 2003. Staff has calculated increases that differ from the recommended amounts, which result in a decrease in FY 2002 of $458,130 and no increase in FY 2003. The subcommittee will note that with the photo license fee set in statute to a maximum of $1, increases in State Highway Funds are recommended to cover the increase in the cost of the digitized photo license (from 94 cents to $2.052). Staff has included the adjustments in the closing to analyze the impact to the budget.
If the subcommittee wishes to accept the amendment, staff recommends an adjustment to increase the reduction in State Highway Funds to $458,130 in FY 2002 with no change to the FY 2003 level. Does the subcommittee wish to accept the proposed amendment? The subcommittee may wish to consider a revision to statute to increase the photo license fee from $1 to $2.052 to cover the increase associated with the digitized photo technology.
Chairman Parks:
Thank you. Before the subcommittee decides these matters, we have a few questions DMV&PS staff might respond to. First, let’s get clarification on the temporary placards. You acquired a supply of temporary placards at a cost of $95,000 and your FY 2000 collections were $14,000. Is this because people are not using them, or because you bought a large quantity up front? Could you explain this to us?
Tom Tatro, Fiscal Manager, Management Services and Programs Division, Department of Motor Vehicles and Public Safety:
We bought a large quantity on the front end because we did not know what kind of inventories we would want to maintain. The agency wanted to maintain a slightly smaller inventory than we anticipated. So, we carried a balance forward into this fiscal year. We did not sell them all, but we have a subsequent order this fiscal year. We hung on to the first order for a little while.
Chairman Parks:
From my observation it seems that they are being used in a “rather spotty manner.” That some dealers use them, and others do not. Are they not all required to use them?
Senator O’Donnell:
Mr. Chairman, I might be better able to explain the reason for that predicament. In the Senate we have an amendment, S.B. 520, that corrects that impediment.
SENATE BILL 520: Authorizes optional registration of vehicles for 2-year period and makes various changes in provisions governing imposition and procedure for distribution of vehicle privilege tax. (BDR 43-1171)
Senator O’Donnell:
To explain, there are two ways one may buy a car. One is to go to the dealership and negotiate the deal and they will put a dealer’s report of sale (DRS) on the window sticker. However, it is subject to approval of financing. The industry refers to this as “rolling the car.” When a person buys a car on a Friday evening and does not get approval because the financial institutions are closed over the weekend, dealers will “roll the car,” allowing the customer to take the car home and then they will get approval on Monday. If the customer does not get approval, then the dealer rolls the car back in and tells the customer there has been a mistake. On Monday the dealer takes the car back, informing the customer he or she failed to get the financing. During that period of time, a customer is rolling a car waiting for the anticipated financing and that is the car that does not get a placard. It is only the cars that get sold that obtain a placard. The Senate Committee on Transportation sponsored S.B. 520 so that any car that gets “rolled with a financial institution’s waiver,” will have to have a placard and so there will not be that “spottiness.”
Chairman Parks:
Are there are other comments relative to the technical adjustments?
Mr. Beers:
On the copies of Microsoft Windows NT that were included in E-710, do they have the flexibility to spend that money on Microsoft Windows 2000 instead, because Microsoft Windows NT has been replaced by Windows 2000?
Mr. Tatro:
Yes, we would be able to buy Microsoft Windows 2000. The Purchasing Division recommended that particular item, but we can make adjustments as we need to. We own Microsoft Windows 2000 licenses for every PC that we currently have. Also, because we purchased upgrade licenses, we could roll those to new machines.
Chairman Parks:
Regarding the digitized photo licenses, we are looking at a cost of 94 cents and a proposed cost of $2.05. Will that $2.05 subsequently come down in price per individual unit over the next year or so?
Mr. Tatro:
No, that price will not come down. We have a multiyear contract with Polaroid that we obtained as a result of a request for proposal (RFP) that was conducted by State Purchasing. We are converting from regular photography to digitized imaging that can be stored on our computer and passed on to law enforcement. It will also print a plastic card with the appropriate information. That card and technology are more expensive than the photographic method used currently. The contract will continue for several years.
Chairman Parks:
That brings us to the next question. Given the fact that we only charge $1, and it is costing us twice as much to produce the digitized fashion, what comments do you have regarding increasing the driver’s license fee to cover the direct cost?
Virginia Lewis, Deputy Director, Motor Vehicles, Department of Motor Vehicles and Public Safety:
The Executive Budget does not reflect an increase for digitized photo licensing compared to what we typically charge the customer today, which is $1.
Chairman Parks:
When you go to the digitized photo licenses, you will have a number of people who want to renew their licenses earlier.
Ms. Lewis:
You are correct, Mr. Chairman. We have been provided information from other states that have implemented this same technology and they are experiencing what they call a “novelty effect.” So, we do anticipate that customers will come in to get the new card. It is a very durable card, and there are improvements for our customers with this card.
Senator O’Donnell:
That was nice to hear, but it did not solve the issue. We cannot continue to take money from the State Highway Fund and subsidize all of these costs in the DMV branch. It is not going to happen. Ms. Lewis, here is what I am going to charge you with. I want you to go over to the Governor’s office and find out whether he would support an additional fee for the driver’s license. He is a prudent man and I surmise he would support such an increase. The Governor knows you cannot run the DMV&PS into the ground. There are other issues out there that we need to address as well, and this is one of those issues. Costs keep going up, not down, and we must put a Band-Aid on.
Ms. Lewis:
I appreciate your concerns and I will seek an appointment with the Governor on this issue.
Chairman Parks:
I suggest the language be such that it would cover the costs incurred for the advanced technology as opposed to locking the figure in at a specific rate. It should be adjusted administratively, rather than statutorily.
Mr. Krmpotic:
As noted in decision item number 2 (Exhibit C, page 14), The Executive Budget recommends increases in module M-200 for estimated demographic increases in photo licenses of $686,745 in FY 2002 and $728,854 in FY 2003. The Governor has proposed an amendment to reduce these amounts by $637,367 in FY 2002 and $526,758 in FY 2003 and include State Highway Fund appropriations of $8,821 in FY 2002 and $103,513 in FY 2003 to pay for the difference in the $1 fee collected versus the $2.052 cost paid. These calculations include an additional increase of 12 percent over the FY 2000 amount beginning with the implementation of the digitized photo technology on April 1, 2002, to reflect increased license issuances associated with a “novelty effect,” which, according to the department, has occurred in other states. This increase accounts for additional State Highway Funds of $4,841 in FY 2002 and $58,300 in FY 2003. Does the subcommittee wish to approve module M-200 for increases for demographic changes? If so, does the subcommittee wish to accept the amendment to change module M-200 based on the recommended changes by the Governor, which increases photo license fees for demographic changes and the novelty effect?
Under decision item 3, the Governor has recommended, through an amendment, an increase in State Highway Funds of $3,113 in FY 2002 and $13,612 in FY 2003 based on anticipated changes in functionality. The department has indicated they anticipate increases in the cost per digitized photo license of 2 cents per photo based on changes to the functionality of the digitized photo licenses. The department has put together a contract that has been signed by the vendor and is awaiting approval by the Department of Administration. That amendment would provide for a test of the photo license process and new software and would incorporate software that allows other sections within the department, as well as law enforcement, to retrieve the records from the digitized photo. Does the subcommittee wish to approve the amendment recommended by the Governor?
Mr. Beers:
What is the novelty effect?
Mr. Krmpotic:
The novelty effect is basically an estimated increase in volume having to do with individuals who want to renew their license or get a new photo just to get the new digitized photo license card when they are not due for a driver’s license.
Under point 5 in the decision items (Exhibit C, page 14), the agency requested $1,820 each year for the administrator and three program managers to meet quarterly with employees to enhance their knowledge and effectiveness of their respective program areas.
Under point 6 (Exhibit C, page 15), decision module E-275 ($108,133 in FY 2002 and $114,376 in FY 2003) recommends the continuation of two positions that were approved at the February 2000 IFC meeting to provide training to department employees. In response to questions at the March 1, 2000, subcommittee hearing, the department indicated that these positions have completed 27 training classes consisting of 508 hours of training to 225 employees. Does the subcommittee wish to approve the continuation of the training positions included in decision module E-275?
Under point 7, decision module E-276 ($146,074 in FY 2002 and $209,059 in FY 2003) recommends the addition of five positions to be assigned to various program areas. In response to questions from committee staff, the department estimates that growth in other divisions will significantly affect the ability of the Management Services and Programs Division to keep up with the growing demands and number of project requests received. Based on questions from committee staff, the department provided a list identifying new projects by program area and the number of staff required to complete the projects. Does the subcommittee wish to approve additional positions recommended in decision module E-276?
Under number 8, decision module E-350 recommends funding of $35,808 in FY 2002 and $33,109 in FY 2003 to contract with the University of Nevada, Las Vegas (UNLV) to provide feedback regarding the level of satisfaction and effectiveness of services that have been rendered within the previous years. The subcommittee may recall the department received approval at the December 4, 2000, IFC meeting to fund a survey totaling $63,827. In response to questions by staff, the department has indicated that the survey funded this fiscal year would establish a benchmark study and the department would plan on repeating the survey every two years with the same criteria. The department has indicated that, under this approach, funding of $35,808 in FY 2002 could be eliminated. The department has also indicated they solicit employees and customer suggestions and implement changes whenever feasible. However, the department has indicated it is important to have representative feedback from the state as a whole. Does the subcommittee wish to approve additional funding of $33,109 to conduct surveys to capture attitudes and perceptions of citizens about the services provided by DMV&PS eliminating the $35,808 in FY 2002?
Under item 9, decision module E-710 recommends funding to replace 25 percent of the desktop and laptop PCs and printers through the DMV branch totaling $638,096 in FY 2002 and $630,800 in FY 2003. Subsequent to staff’s adjustments, recommended amounts have been revised to $424,249 in FY 2002 and $419,704 in FY 2003. Based on direction from the subcommittee, staff has requested information from the department to allocate PC purchases to each budget account in the DMV branch. The department has indicated:
The Motor Vehicle branch acts as one branch rather than individual divisions or budget accounts and that the new DMV Administrative Services will be responsible for providing the checks and balances over the purchases and expenditures.
Because the information was not provided by the department, committee staff has developed estimates for the number of personal computer required by budget account based on location and the number of staff by budget account. Does the subcommittee wish to approve computers and printers by budget account as recommended by staff? If so, staff would recommend the elimination of decision module E-992 that transfers replacement computers and printers to the DMV, Administrative Services budget and instead reflect the funding in the individual budget accounts.
Lastly, staff would point to item number 11 (Exhibit C, page 16). The Executive Budget recommends the split of the Department of Motor Vehicles and Public Safety branches into a Department of Motor Vehicles and a Department of Public Safety. Decision unit E-960 recommends the transfer of 11 full time equivalent (FTE) positions responsible for administrative functions, printing expenses for registration forms, and drivers’ license photo fees to the Department of Motor Vehicles administrative services budget account to consolidate administrative expenses into one budget account. If the subcommittee does not wish to approve the split of the departments, the subcommittee may wish to consider elimination of this decision module, since consideration will not be necessary to consolidate administrative functions for the stand-alone Department of Motor Vehicles. If the subcommittee wishes to approve the split of the department, staff would request approval to make adjustments to increase transfers out for expenditures approved in other decision modules.
Finally, staff would ask approval to make changes to the cost allocations in E-801, E-930, and E-977 based on final approval of the budget accounts for Administrative Services, the Director’s office and the Highway Patrol.
Senator Jacobsen:
I would like to go back to the issue of surveys. It seems to me that $33,000 to conduct a survey to tell you something you already know requires justification. Also, explain to us how the survey is conducted, in-house or by mail. The people the DMV branch wants to contact are the people the department is servicing.
Tom Tatro, Fiscal Manager, Management Services and Programs Division, Department of Motor Vehicles and Public Safety:
The department wants to reach all of the customers that do business with the DMV branch. We have alternatives and we try to gauge the feelings of our customers that come into our field offices, but a large percentage of our customers do not come into our field offices. Therefore, the field offices do not capture the level of satisfaction those people have, or we cannot come to any conclusions about what motivated them or what did not motivate them. We want to be able to assess the quality of all aspects of our operation. The only way we can effectively do that is to reach the customers who use the alternative methods of service that we provide. A separate study will target those customers and be able to access the information. That will allow us to come up with an appropriate mix in order to have meaningful data.
Senator Jacobsen:
Do you share that information with your staff on a regular basis?
Mr. Tatro:
We are preparing to do the first survey. I am sure that information will be shared with the employees of the DMV branch. What we are asking for in the budget is to be able to follow up on the items that are investigated in the initial survey so we can gauge our progress in the different areas, and gauge the levels of customer satisfaction and determine which of our changes and modifications are effective.
Virginia Lewis, Deputy Director, Motor Vehicles, Department of Motor Vehicles and Public Safety:
When we came before the December IFC, we laid out for the committee a public relations campaign. A component of that was to have an objective survey of our services completed. We had done an in-house survey in April 2000. While this gave us an indication of how our customers were evaluating our service, since it is done in‑house I think there is a loss of objectivity. I believe it is very important that we can provide to the Governor’s office, to this body and to our employees an objective evaluation. We discussed with staff that having that initial survey done this fiscal year, with funding given to us in December 2000, and waiting until FY 2003, gives us time to improve in those areas in which the survey has pointed out we are deficient. Initially the budget requested a survey every year. However, that is not reasonable and the recommendation is to do a survey every two years. It gives us more time to make those changes.
Senator Jacobsen:
I do not remember seeing that survey. What kind of a format does it have? Is it true and false, yes and no?
Ms. Lewis:
The survey that is going to be conducted by the outside marketing firm will be handled a couple of different of ways. They will do the direct contact. They will gather data when customers come out of our field offices and have them express their initial feelings of their visit. The survey will evaluate many different areas of our services, including the facilities, the employee courtesy, knowledge and efficiency, and their overall experience. It is not a true and false survey, but an in‑depth survey.
Senator O’Donnell:
I hate to disagree with Ms. Lewis, but I can tell you what the survey will say. On a scale of one to ten, it is about a four. Now I just saved a lot of money. If you want you can post my e-mail address on the outside of the DMV buildings and have those people contact me if they have a complaint or they have an accolade. We all know what the problem with the DMV branch is. To conduct surveys and to ask people how they feel about how they were treated is a waste of time and money. Hiring people who are professional shoppers that go in and register a fictitious car would be a better way to spend the time and money. That way you can see how your employees are actually doing. That will probably be a better survey that will give you productive results rather than going out and pestering customers. I imagine an interview like this: “Excuse me, I understand you waited in line for four and a half hours. Could we ask you to just step over here for ten minutes and fill out this survey.”
Ms. West:
There is a program being implemented in the field called a “mystery shopper” program. While we haven’t exactly gone outside yet, we have formed a group with our front line supervisors who are interested in customer service. We have put together scoring criteria that they will use to assess the same kinds of things that Ms. Lewis talked about: the facility, the way employees serve customers, the way the employees greet customers, and the availability of forms. They are going to go into a branch office dressed casually and spend the day in and out of the lobby, sitting and talking with the customers, and gathering data. They will provide their reports to me and I will be meeting with the managers. We are starting this program with inside staff because we want people to understand where the department has been and what we have been through. We want to build confidence in our staff of dealing with another mechanism of feedback as we have with the comment cards.
Senator O’Donnell:
How much is that going to cost?
Ms. West:
That will entail a very limited travel budget. We have 11 members on the team. They will all be flying around the state. The only cost will be their airfare and per diem for 11 people for a day. Then they will go back after an agreed upon time frame and assess whether the branch they initially monitored has corrected its weaknesses.
Senator O’Donnell:
Is that going to cost $70,000? How much is that going to cost?
Ms. West:
No, Sir. I would have to do the calculations, but the money will be taken out of our existing in-state travel budget. The cost is estimated at $3,000.
Senator O’Donnell:
To be honest with you, I would rather fund more staff for DMV than the $70,000 requested for this survey. You need more people to staff your windows. No doubt about it that is the answer. We do not need a survey to tell us what DMV needs, you need more people at the DMV service windows.
Mrs. Chowning:
I agree entirely with Senator O’Donnell that the best mechanism to improve the DMV branches is through meeting staffing needs. Do you still have the suggestion boxes in which people are free to place their comments? I see heads nodding in the affirmative.
Ms. West:
We have taken that program one step further with a new and improved comment card, which the customer can fill out and request that a member of DMV staff contact them. Then the branch manager or frontline supervisors call back all customers that have indicated they want a call back. We have a dialogue with those customers and data that provide us information on a satisfaction percentage per branch. Believe it or not, the customers currently filling out those comment cards are indicating they are anywhere from 80 to 90 percent satisfied with the level of service they are getting at DMV. Those customers are saying what Senator O’Donnell has indicated that we need additional staffing at our service windows.
Mrs. Chowning:
What the customers need and what the employees need is in decision item 6. I highly support the additional travel so the administrators and program managers can meet quarterly with the employees to enhance their knowledge and effectiveness and to keep the training persons operating. I met last evening until 8:15 p.m. in my office with employees from only one office in Reno. They have expressed great concern about the need for training. Some of these individuals have been working with DMV since the beginning of Genesis, and a lot of them are still working and training. These people need help. They need other employment opportunities so that they can go into other positions and not just have to do this training. They need the machines to take less time with the customers. That is going to make the customers happy. That is getting there, but we are not there yet.
The Q-Matic Lobby Management Systems (Q-Matic) is working for customer satisfaction and the seats are being made available. However, the employees need training. That office still does not have the cross training that apparently exists in other offices. I have expressed these concerns and hopefully we will have a meeting with staff and those employees. However, I do not believe that we need to spend money at the University of Nevada, Las Vegas, to conduct this survey. As Senator O’Donnell has said, we hear from people; and we do not hear from the people as much as we use to. I think that is because people do not like having to take all that time off from work. So, I agree with all of the decision items (in Exhibit C) with the exception of decision item 8.
Senator O’Donnell:
I want the DMV branch fixed like we had it six years ago. When a person would walk into the DMV office and it took longer to find the department supervisor than it took to go through the line. I am not going to leave here until I get from you, and you were supposed to tell me this, how many staff people you need to accommodate the growth and get to where we were six years ago. I have the bill that lifted that cap and I want to know how many people you need. We are not going to leave here and go back to our constituents and tell them that we did not solve this problem this session. We created this problem two years ago when we cut the staff and we are not going to do that again. I want to go home and run on the fact that I and the rest of this subcommittee “fixed” the DMV.
Ms. West:
You are correct. We have submitted to staff what it would take to staff our windows 100 percent. We have provided staffing levels for extending hours if this body is interested in funding that program.
Senator O’Donnell:
Are the positions in this budget? How many more employees do you need to hire?
Ms. West:
No, Sir, they are not. In order to get that figure I would have to have the staffing formula in front of me and I did not come prepared. My instinct and everything I know about this business tells me those 64 part-time positions we obtained through the IFC in December 2000 need to be full-time positions for us to get through this next biennium, keep up with growth, and provide the level of service our customers expect.
Senator O’Donnell:
Will that staffing level get the waiting time down to 10 to 15 minutes?
Ms. West:
I do not know that we will get to 10 to 15 minutes with that level.
Senator O’Donnell:
Okay. In the next 48 hours, I need for you to tell me, and the rest of this subcommittee, how many staff members you need to solve this problem.
Ms. West:
I will be happy to provide that for you.
Mr. Beers:
I believe Senator O’Donnell will find the software he is looking for to fix this problem is not year 2000 (Y-2K) compliant. That is why we have Genesis and that is why we will not get down to the levels we were at before Genesis. We will never get down to past levels.
Chairman Parks:
Are there any other questions on the decision units or the technical adjustments that are in this budget? Not seeing any, I will entertain a motion on the technical adjustments first, and then we will deal with each of the decision units individually.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE THE TECHNICAL ADJUSTMENTS RECOMMENDED BY STAFF FOR BUDGET ACCOUNT 201-4742.
ASSEMBLYMAN MARVEL SECONDED THE MOTION.
Chairman Parks:
Is there any discussion on the motion?
Mr. Beers:
How would the video camera be used in training?
Mr. Krmpotic:
I did not specifically ask the agency for a response on that issue. In other divisions within the department where they requested a video camera for training, I believe the purpose is to video employees working in their processes, show that video back to the employees, and critique what they have done. The agency may have more information on that.
Mr. Beers:
I believe Mr. Jim Parsons, Environmental Management Specialist, Chairman, Advisory Committee for the Control of Vehicle Emissions, Compliance Enforcement Division, Department of Motor Vehicles and Public Safety, just confirmed that point. Thank you.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Chairman Parks:
We have approved the technical adjustments on this budget account. Let us proceed with the decision items. The first item is the increase in category 20, photo licenses. Do we have a recommendation here? I believe one of the recommendations is to consider increasing fees to cover the cost of the digitized photo licensing process. Do we have a motion?
Mrs. Chowning:
So that we all understand, if we approve this module does it increase State Highway Funds in FY 2003 of approximately $170,000, but decrease State Highway Funds in FY 2002 in the amount of $409,782?
Chairman Parks:
Yes, that is as I see it.
Mrs. Chowning:
Overall, it appears we have a decrease to the State Highway Fund of about $200,000? Is that correct?
Chairman Parks:
Yes.
Mr. Krmpotic:
The Governor proposed an amendment to decrease State Highway Funds in the first year by $409,782 and increase State Highway Funds in the second year by $169,431. Staff recommends an adjustment in that to decrease the highway funds the first year by $458,130 with no increase in highway funds the second year. The end result, if that is accepted by the subcommittee, is that highway funds would fund the increase in the cost of the digitized photo licensing process at approximately $87,000 in FY 2002 and $545,000 in FY 2003. Those amounts would fund the difference in the cost if the subcommittee approves the amendment as revised.
Chairman Parks:
I recommend we close the budget with the recommendation in the budget making these particular changes recommended by staff. This would then create an opportunity for further discussion on handling that issue.
Senator O’Donnell:
We have got to solve this problem. Let me recommend something that might work. These fees are changing constantly. The contractual costs increase and these fees change. What if we allow the DMV branch to increase fees based upon the increase in the contractual amount? This would take it out of the statutory dollar limit that we set here as a Legislature. Why do we not allow DMV to establish by regulation the fees necessary to cover the costs of producing a license? I have a couple of bills in my committee and I am sure Mrs. Chowning has a few bills that we could look at to accomplish this effort. That would solve the hole in the budget regarding the State Highway Funds. This would establish the fees to equal the cost.
Mrs. Chowning:
I tend to agree. The only matter that makes me uncomfortable is not placing a ceiling on this fee. We could do that with a Letter of Intent, Senator.
Senator O’Donnell:
The Letter of Intent would be a statute?
Mrs. Chowning:
It would allow DMV to raise the fee as necessary, but with a cap. Currently, there is a bill in the Assembly Committee on Ways and Means that is going to the Senate that allows for private contract (smog stations) an increase in fees from the current $3 fee to $10 fee, or with an option to have “no fee.”
This example would be appropriate in the case before this subcommittee. What would comfort me is if the subcommittee allowed the fee to be increased from $5 to $10. This is innovative action and we should give the DMV branch the ability to increase fees administratively because the alternative is the State Highway Fund constantly takes these “big hits.” I did not realize the loss to the State Highway Fund was as expensive as $600,000.
Chairman Parks:
We cannot do a revision to the statute in this committee today. That will have to come from a different committee. My recommendation is to close this budget account in the fashion staff has recommended for the reduction to State Highway Funds, which would then force the issue in one of the other committees unless we come back to readjust the budget.
Senator O’Donnell:
What would we be closing the budget as – the former fees or the actual costs?
Chairman Parks:
What we would close the budget at the actual cost or the actual budget that we would provide. Perhaps Mr. Krmpotic could assist me on that issue.
Mr. Krmpotic:
The budget as it currently exists provides for the existing costs. With the amendment, it provides for existing costs through April 2, 2002, and then the budget would reflect the increase in the costs from that point forward. This would reflect the existing cost of the photo license of 94 cents through the first three quarters of FY 2002. Once the department implements the technology for digitized photo licensing on April 1, 2002, the budget would reflect the higher cost from that time forward of $2.05, $2.07 if the subcommittee approves decision item 3 (Exhibit C, page 14).
Senator O’Donnell:
That will work. I will place in the motion that Mrs. Chowning and I will look at the various bills in our respective committees to determine whether we can find a way to augment the necessary funding. If we cannot do that, can we, by rule, request a bill from this subcommittee to do that? That is the best procedure. Let us request a bill from this subcommittee to augment the ability for the DMV branch to establish by regulation the fees set pursuant to the NRS chapter we will be dealing with, and they have to be calculated to produce for that period, for that much projected revenue, the amount of money necessary to cover the costs of digitized photo licenses. I will make that as my motion. If you place a cap on this, you are advertising to vendors and they migrate towards that figure. Mrs. Chowning, if you want a cap, you can amend the motion.
SENATOR O’DONNELL MOVED TO APPROVE THE GOVERNOR’S RECOMMENDED AMOUNT FOR CATEGORY 20 IN BUDGET ACCOUNT 201-4742 WITH ADJUSTMENTS RECOMMENDED BY STAFF IN DECISION ITEMS 1 AND 2 AND TO PREPARE A BILL DRAFT THAT ALLOWS THE LICENSE FEE TO BE SET ADMINISTRATIVELY.
ASSEMBLYWOMAN CHOWNING SECONDED THE MOTION.
Chairman Parks:
Does everyone on this subcommittee understand the motion to follow staff recommendations and request a bill from this subcommittee?
Steve Abba, Principal Deputy Fiscal Analyst:
If I might clarify this issue. As part of this subcommittee action, the motion is to request a bill draft that allows the DMV to set a fee or to establish the language of this particular statute that sets this fee, allowing the department the ability to administratively increase that fee to cover the costs associated with the contracts doing this type of business.
Senator O’Donnell:
That is correct, Mr. Abba.
THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
We have now taken care of decision items 1 and 2. Item 3 is whether we wish to approve an amendment recommended by the Governor for the addition of 2 cents per photo based on changes to the functionality of the digitized photo license. So, with what we have just concluded, if someone came into a DMV branch for a novelty license, then they would pay the full cost for the service. Let us move on to other decision items.
We will take all of the positions together. That would be continuation of the positions approved by the IFC in February 2000 as well as the five additional positions in module E-276. Do we have a motion on those?
SENATOR JACOBSEN MOVED TO APPROVE THE POSITIONS IN DECISION UNITS E-275 AND E-276, INCLUDING THE CONTINUATION OF THE POSITIONS APPROVED BY IFC IN FEBRUARY 2000 AND THE FIVE NEW POSITIONS IN BUDGET ACCOUNT 201-4742.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
The next item is decision item 8 (Exhibit C, page 15), which is the consumer perception survey. Do we have a motion?
Senator O’Donnell:
Mr. Chairman, I would like to move this budget account without the augmentation for the surveys.
SENATOR O’DONNELL MOVED THAT THE CONSUMER SURVEY IN DECISION UNIT E-350 OF BUDGET ACCOUNT 201-4742 BE DELETED.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL WAS ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
Decision module E-710 recommends funding to replace 25 percent of the desktop and laptop PCs (Exhibit C, page 15, item 9). Do we have a motion?
SENATOR JACOBSEN MOVED TO APPROVE DECISION MODULE E‑710 IN BUDGET ACCOUNT 201-4742 IN ACCORDANCE WITH THE ADJUSTMENTS RECOMMENDED BY STAFF.
ASSEMBLYMAN BEERS SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMAN PERKINS WERE ABSENT FOR THE VOTE.)
* * * * *
Mrs. Chowning:
I would like to point out the good work that has been accomplished here. That is a savings of $220,000 in each year of the biennium.
Chairman Parks:
The next decision unit is module E-711 (Exhibit C, page 16, item 10) for specialized equipment for training such as the in-focus projector, one overhead projector, one video camera and a laptop computer.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE DECISION MODULE E-711 IN BUDGET ACCOUNT 201-4742 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO TECHNICAL ADJUSTMENTS RECOMMENDED BY STAFF.
ASSEMBLYMAN BEERS SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMAN PERKINS WERE ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
The next decision unit is E-960 (Exhibit C, page 16, item 11) for the transfer of 11 positions responsible for administrative functions. This relates to the split of the department into two departments: DMV and PS.
Senator O’Donnell:
The Senate Committee on Transportation has looked at the proposal to split the department into two departments, has passed that bill out of committee and is waiting for the amendment. Then the bill will go to the full Senate. I believe there is a conflict amendment. Mr. Chairman, I suggest the subcommittee close this budget predicated on the split of the agency.
Chairman Parks:
I would be more in favor of holding off at this time and making the final decision pending outcome of the potential agency split since there is a bill in process. The situation we face, however, is that we need to make a decision relatively soon so that subcommittee staff can make the necessary adjustments relative to cost allocations and so forth. I believe that would conclude the decisions we need to make in this budget account.
Mr. Abba:
In regard to the closing of the first account, the Compliance Enforcement budget account, I want to clarify the motion, in case there was any confusion. Our understanding is the subcommittee approved the technical adjustments recommended by staff. The second action was that the fingerprint fees were added into the account to reconcile for each fiscal year of the biennium. The balance of the account was approved as the Governor had recommended with the flexibility for the staff to make the necessary cost allocation adjustments and there was no Letter of Intent that was to be issued regarding allocating the cost for fingerprint charges to the wrong category.
Chairman Parks:
That is as I understand it. Is that the understanding of the rest of the subcommittee members? Since there are no objections I am presuming that is correct.
Mrs. Chowning:
Just to clarify the two positions regarding the traffic safety and driving schools are recommended in the Governor’s budget and therefore will be approved. Correct?
Chairman Parks:
Yes, that is my understanding. Thank you. We will then move on to the next budget account.
DMV, Verification of Insurance – Budget Page DMV-50 (Volume 3)
Budget Account 201-4731
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit C, page 20.)
Staff recommends the following technical adjustments:
1. A decrease in the base in the intrabudgetary transfer category based on revised calculations for a position in the Central Services budget account supported with transfers from the Insurance Verification budget account.
2. Increasing decision module M-301 for intrabudgetary transfers to the Central Services budget account and the Management Services budget account for cost‑of‑living and fringe benefit increases for positions supported with transfers from the Insurance Verification budget account.
Staff would add one adjustment that is not reflected on the closing sheet. That would be to place the cost allocation in decision unit E-801 in a separate category as has been recommended with all budget accounts in the department.
Regarding the first decision item, the subcommittee will recall discussion on the amount of the reserve occurred during the subcommittee hearing. The 1999 Legislature authorized a reserve of $500,000. In FY 2000, the department increased the reserve from $500,000 to $1 million based on a statutory provision that requires the State Controller to transfer to the State Highway Fund any amount in the account that exceeds $1 million. The department indicated at a subcommittee hearing that a $500,000 reserve is sufficient to meet the cash flow needs for this budget account. Does the subcommittee wish to request legislation to reduce the reserve from $1 million to $500,000 and adjust The Executive Budget to reflect the decrease to the reserve?
Senator O’Donnell:
We need a bill draft request for that particular purpose. I do not believe we can just transfer money out of the Insurance Verification budget without having a bill draft. We will have to request a bill draft. Are you looking for a motion?
Chairman Parks:
I was thinking we could get the complete report from Mr. Krmpotic and then entertain all matters in one motion.
Mr. Krmpotic:
Decision module E-720 recommends the addition of one color laser printer to produce reports with colored charts for presentations to insurance companies, lobbyists, and the Legislature. E-720 also recommends 12 laser printers to be assigned to staff that interface with citizens, causing a greater need to print documents. Does the subcommittee wish to approve the recommendation for new printers?
Decision module E-801 recommends increases in funding, based on the allocation of expenses from the Administrative Services and Director’s office budget accounts. Decision module E-927 recommends the transfer of contract security system expenses from the Highway Patrol budget account.
Lastly, decision module E-949 recommends increases of $7,342 per year based on the allocation of direct expenses from the Administrative Services budget account.
Staff seeks approval to make changes to the cost allocation in E-801 and the transfers in E-927 and E-949 based on final approval of the budgets for the Administrative Services Division, Director’s Office and Highway Patrol budget accounts.
Chairman Parks:
Are there any questions for Mr. Krmpotic regarding any of the decision items or the adjustments? Hearing none, the floor is open for a motion, which would also request legislation to reduce the reserve from $1 million to $500,000.
ASSEMBLYMAN BEERS MOVED TO CLOSE BUDGET ACCOUNT 201‑4731 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO THOSE ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMAN PERKINS WERE ABSENT FOR THE VOTE.)
* * * * *
Senator O’Donnell:
Does that include the new printers? Staff recommendations are one and two and the decision items are what we need to deal with. So, one is the transfer of the money and the others are the new printers and the allocation of expenses.
Chairman Parks:
We need to verify the members of the subcommittee desire to approve the addition of the one color laser printer and 12 laser printers. As I understand it, that was included in the motion. Please indicate otherwise if there is any objection to that motion. The remaining item is the allocation of expenses from Administrative Services and the like. I believe we have some other decisions that will have to be made before those can be firmed up.
Mrs. Chowning:
Before we leave this budget, I would like to ask the agency to comment on the recent problem that 9,000 rejections have popped up resulting from “no insurance.” I do not want these 9,000 people to be fined for “no insurance” when it has been a mistake. I would like some feedback and assurance that these people are not going to be charged. Also, we have a bill in the Assembly that allows more flexibility so that the department can make a different decision, based on extenuating circumstances, other than automatically fining the customers.
Dana Mathiesen, Administrator, Central Services and Records Division, Department of Motor Vehicles and Public Safety:
We briefly discussed this problem in mid-March at our last budget hearing. One of the companies, California State Automobile Association (CSAA), erroneously sent a cartridge that deleted all insurance records, rather than adding, terminating, or submitting the proper code. As a result, those customers were sent insurance verification cards. There was a 45-day period during which the company worked with the department to send in corrected cartridges that would prevent suspension. To our knowledge, there were no suspensions resulting from any of those records. They were corrected before the suspensions occurred.
Chairman Parks:
We are finished with this budget account. Let us move forward to the next budget account.
DMV, Motor Vehicle Pollution Control – Budget Page DMV-55 (Volume 3)
Budget Account 101-4722
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit C, page 22.)
Staff recommends the following technical adjustments:
1. Reducing revenues in FY 2001 based on revised projections from the agency. This adjustment reduces the balance forward in FY 2002 by $202,696 with a corresponding reduction in the reserve.
2. Reducing amount to be transferred to the Division of Environmental Protection (DEP) in adjusted base to match the amount of transfer revenue in the DEP budget.
3. In the M-301 module, increasing transfers to the Compliance Enforcement, Central Services and Management Services budget accounts for changes resulting from the cost-of-living increases and fringe changes for positions allocated from the pollution control account.
4. Changing the category designation for the intra-agency cost allocation proposed in decision unit E-801 to better identify expenses associated with the allocation.
S.B. 357 was recently amended and passed by the Senate Committee on Natural Resources.
SENATE BILL 357: Revises provisions governing disbursement of money from pollution control account. (BDR 40-1180)
This bill calls for an increase in the fee for each form issued by an emission station of not more than $3, to be set by the county commission in a county whose population is more than 400,000. This bill also modifies the distribution of funds from the pollution control account to local governments by automatically distributing 20 percent of the money received and allowing for grants of any money in the account in excess of $500,000. The Executive Budget currently reflects 20 percent of annual revenues distributed to local governments as provided by statute.
About the first decision item, the subcommittee will recall that concerns were raised regarding the declining reserve balance over the biennium. The reserve level, as of June 30, 2001, after the adjustment to FY 2001 revenues, is estimated to decline to $1.6 million. The Executive Budget projected a further decline in the reserve balance to $500,000 by FY 2002, which levels out in FY 2003. This program is responsible for assisting with efforts to improve the air quality in counties with a population of 100,000 or more. By law, grants to agencies in a county must be made from one-fifth of the amount received for each $5 issued in the county and money in excess of $500,000 in the pollution control account at the end of the fiscal year. Based on the decline in the reserve, The Executive Budget recommended elimination of the excess reserve grants in FY 2003 of approximately $1 million. The Governor has recommended the following amendments to this budget account:
Elimination of excess reserve grants in adjusted based totaling $1,100,728 in FY 2002;
Correction for the purchasing assessment adjustment in module M-100 in FY 2003 from ($16,427) to ($2,146); and
Increases in the transfer to DEP each year in adjusted base by $79,800 to restore the reserve to a positive balance in the Account for the Management of Air Quality.
The Budget Office indicates that excess reserve grants to the counties would continue to be awarded depending on the reserve amounts in excess of $500,000. The net impact of the above budget amendments, along with the recommended technical adjustments, results in an increase in the reserve in FY 2002 from $500,000 to $1,328,238 and an increase in FY 2003 from $519,157 to $1,263,321. Does the subcommittee wish to approve the amendments recommended by the Governor?
Decision unit E-279 in item 2 (Exhibit C, page 23) recommends the elimination of transfers to the Field Services Division budget account of $418,904 in FY 2002 and $429,255 in FY 2003 for nine positions transferred by the IFC in February 2000. Historically, the pollution control budget account has supported the cost of positions in field offices based on time required by technicians to review the emissions certificate at the time an individual registers a vehicle in Clark County or Washoe County. The agency testified that new technology, which automatically downloads information from the emission stations to the Genesis system, eliminates the need for manual review of the emission certificate at the time of registration. The second decision is whether the subcommittee wishes to approve the elimination of the transfer to the Field Services budget account of approximately $400,000 each year.
The amount transferred to the Health Division may increase by approximately $60,000 each year based on approval of the final closing recommendations by the Joint Subcommittee on Human Resources/K-12. Committee staff seeks approval to make changes to the amounts transferred depending on approved adjustments to the Governor’s recommended budget by the Joint Subcommittee on Human Resources/K-12. Lastly, staff seeks approval to make changes to the cost allocations in E-801 and E-948 based on final approval of the budgets for the Administrative Services Division and the Director’s Office budget accounts.
Chairman Parks:
Thank you.
Senator O’Donnell:
I am a little confused on this budget account. First, we have a $3 dollar increase in the fee coming down from the Senate Committee on Natural Resources to augment this particular budget. However, I see that there is a $500,000 grant program that can be made from this account to the counties. Is that correct?
Mr. Krmpotic:
The statute currently provides for grants for the amount in excess of $500,000 reserve to be made to the counties. The department has just informed me that S.B. 357 was amended before passing out of Senate Committee on Natural Resources to eliminate the $3 increase in the fee.
Senator O’Donnell:
Excuse me, but I thought the bill was to add the $3 fee so if you amended it, what does the bill do now?
Jim Parsons, Environmental Management Specialist, Chairman, Advisory Committee for the Control of Vehicle Emissions, Compliance Enforcement Division, Department of Motor Vehicles and Public Safety:
The Senate Committee on Natural Resources had that bill from Clark County. Clark County has amended that bill and removed the $3 and added the $6 clean air surcharge fee to be attached to the registration.
Senator O’Donnell:
I thought that was under the Legislature’s purview, not Clark County’s.
Mr. Parsons:
Clark County amended the bill and it was passed by the Senate Committee on Natural Resources. The bill states that a maximum of $6 can be approved by the Clark County Board of Commissioners.
Senator O’Donnell:
So, how does that relate to this particular budget? Does the $6 fee go into this budget and go back out? I am confused and frustrated by the fact we have all of these environmental protection budgets doing basically the same thing.
Mr. Parsons:
The way I understand this is the $6 fee goes into an account and that is transferred directly to the counties.
Senator O’Donnell:
For what purpose is the $6 to be used?
Mr. Parsons:
It funds the new agency that has been created by a set of five bills that did a study last year that I refer to as the S.B. 432 subcommittee.
SENATE BILL 432 OF THE SEVENTIETH SESSION: Directs Legislative Commission to conduct interim study of certain air quality control programs and Department of Motor Vehicles and Public Safety to implement certain programs of air quality controls. (BDR S-54)
Senator O’Donnell:
So, where do you get these funds to put in this particular budget?
Mr. Parsons:
The funds come from the sale of emission certificates, which comes from private citizens getting their automobiles tested.
Senator O’Donnell:
Let me get this straight. There is a $6 charge for every motor vehicle that gets a smog check. That goes to the counties for emission control or pollution control. Then there is an additional $5 that goes into Nevada’s pollution control account.
Mr. Parsons:
Of that $5 charged by DMV, $1 goes back to the county.
Senator O’Donnell:
So now the counties are getting $7?
Mr. Parsons:
Yes, Sir.
Senator O’Donnell:
Additionally, the counties get to apply for grants for any of the money that is left over beyond $500,000.
Mr. Parsons:
Yes, Sir.
Senator O’Donnell:
Okay, at least now I know. I am not so sure I like it. I wish I had sat in on those hearings. How much will the $6 generate?
Mr. Parsons:
I believe Clark County estimated just under $1 million a year would be generated per dollar charged. That would be $6 million per year that goes back to the new agency that was created by S.B. 432.
Senator O’Donnell:
Does the state do the same things for the $5 that the county is going to do for the $6?
Mr. Parsons:
I can only answer from the department’s perspective. What the department does is not reflected in what the county does. The county does the planning, implementation, and preparation. The department implements the testing portion of the program for the motor vehicles.
Mrs. Chowning:
As I understand it, this $6 has to be carried over to the Clark County Board of Commissioners and they have to vote on that. So, it is enabling language, but the Clark County Board of Commissioners has to justify the need for that increase to the citizens of Clark County. It will not take effect until they agree to add that increase.
The need for this is tied into the particulate matter (PM10) study conducted by the federal Environment Protection Agency (EPA). The Las Vegas Valley suffers some of the worst PM10 pollution levels in the country. Over the past several years, local agencies have prepared and submitted to EPA plans that were to reduce this pollution. Today, the EPA is responding to Nevada’s recent withdrawal of these earlier PM10 state implementation plans (SIPs) for the Las Vegas Valley area by finding that the withdrawal is tantamount to not submitting federally-required plans that would improve air quality and protect public health. The EPA is proposing to disapprove the moderate and serious nonattainment area SIPs submitted by Nevada for attaining the PM10 national ambient air quality standards in the Las Vegas Valley.
Senator O’Donnell:
So, will the DMV have to reprogram its computer systems to handle this additional $6, and does that money come out of the State Highway Fund?
Mr. Parsons:
Yes, we will have to make some programming changes and I gather it would be coming out of the Department of Information Technology budget when they have to do the programming changes.
Senator O’Donnell:
I am not so sure the Governor is going to go for this. To me this is a duplication of services. To me this smacks of the shell game of taking money from one place and putting it in another. Even though the Clark County Board of Commissioners has the ability to raise these taxes, I have never known the Clark County Board of Commissioners to be authorized by the state to collect taxes and to not vote for it. Over the past 48 years that I have lived in Las Vegas, I do not believe the board of commissioners has ever turned this down. I am sure this is going to be implemented.
Then we have money left over after $500,000 that we are going to give them in grants and another $1 on top of the $6 they could collect. Yet, the state is the one that is going to be paying for the programming and the DMV computer. The state is the entity charged with collecting this money. The state is saddled with the administration of this and, yet, what does the state get? This is just not fair. Maybe you should take that $1 that DMV will give back to the counties and place it back in the State Highway Fund to pay for all the administration this will entail.
Chairman Parks:
So, as we understand this, it is $5 now, of which $1 goes to the county of origin. S.B. 357 is requesting to increase that amount from the current $5 to $8, which would give counties the additional $3 at the counties option. The computer programming would have to adjust for the county option. That $3 million a year would fund the air quality programs in Clark County. In addition, if there is any money over the $500,000 in reserve, that gets parceled out to various counties, as well. Am I correct?
Mr. Parsons:
The $3 has been amended to $6, attached to the registration and not the emission certificate.
Chairman Parks:
Thank you. I stand corrected. At this point we are in a position for motions to act on each of these decision items and technical adjustments. I will accept a motion on the technical adjustments.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE THE TECHNICAL ADJUSTMENTS IN BUDGET ACCOUNT 101-4722 RECOMMENDED BY STAFF.
ASSEMBLYWOMAN DE BRAGA SECONDED THE MOTION.
Chairman Parks:
Is there any discussion on the motion?
Senator O’Donnell:
We can go ahead and close this budget account because anything we do does not affect the S.B. 357. However, we are going to watch that bill’s course very carefully.
Ms. Lewis:
As we collect other taxes at the time of registration, perhaps we should be given a commission for that collection effort.
Senator O’Donnell:
I am glad you pointed out that issue because now we register cars and it costs the state more to register the cars and send the money to the counties than the amount DMV gets to pay for registering the car. It is blatantly unfair.
Chairman Parks:
In some situations there is a 1-1/4 percent collection fee that is taken for administrative collection.
We have a motion and a second to approve the technical adjustments to this budget account. Is there any further discussion by this subcommittee?
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMEN PERKINS AND BEERS WERE ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
Moving into the decision items, we have the question of the reserve in decision item 1 and the amendments recommended by the Governor.
Senator O’Donnell:
Mr. Chairman, I believe we will need a bill for that matter.
Chairman Parks:
Thank you. The Governor has recommended the following amendments to this budget account: elimination of excess reserve grants in adjusted based totaling $1,100,728 in FY 2002; correction for the purchasing assessment adjustment in module M-100 in FY 2003 from ($16,427) to ($2,146); and increases in the transfer to DEP each year in adjusted based by $79,800 to restore the reserve to a positive balance in the Account for the Management of Air Quality from the pollution control account.
Mrs. Chowning:
To put this in perspective what this means is that the reserve is low, therefore the reserve needs funds deposited into it and the amounts to the counties and grants are going to be going down. But, there is not enough money currently and it needs to go up for the grants to go to the counties. However, they are just not going to get as much as in previous years. I would move for approval of this item.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE THE AMENDMENTS RECOMMENDED BY THE GOVERNOR IN DECISION ITEM 1 IN BUDGET ACCOUNT 101-4722.
SENATOR O’DONNELL SECONDED THE MOTION.
Chairman Parks:
Is there any discussion on the motion?
Senator O’Donnell:
Let me get this straight. As I understand this, because the reserves are low, we are not going to give out as many pollution control grants as we have in the past. Is that correct? Committee staff, how did the reserve get so low in the first place?
[Pause for collaboration with Mr. Ghiggeri.]
Mrs. Chowning:
I keep bringing up the issue of the tire fee. There is a $2 charge for every single tire that customers purchase throughout the state. There is a lot of money in that fund that is in the Motor Vehicle Pollution Control account. It seems to me that these are connected. Why can we not take money from the tire assessment? It seems to me that money could be brought here to help DMV’s budget regarding EPA matters.
Chairman Parks:
Again, we have a motion. Is there any further discussion?
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMEN PERKINS AND BEERS WERE ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
We have a few more decision units to act on regarding this budget account. Decision unit E-279 in item 3 (Exhibit C, page 23) recommends the elimination of transfers to the Field Services Division budget account of $418,904 in FY 2002 and $429,255 in FY 2003 for nine positions transferred by the IFC in February 2000. I will entertain a motion.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE THE ELIMINATION OF THE TRANSFER TO THE FIELD SERVICES BUDGET ACCOUNT DESCRIBED IN DECISION ITEM 3 IN BUDGET ACCOUNT 101-4722.
SENATOR JACOBSEN SECONDED THE MOTION.
Chairman Parks:
Is there any discussion on this motion by the subcommittee?
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMEN PERKINS AND BEERS WERE ABSENT FOR THE VOTE.)
* * * * *
Senator O’Donnell:
Mr. Chairman, the $1 transfer is built into this budget account in terms of that money going to the counties. I would like to see this subcommittee request a bill draft that would allow the DMV branch to collect a commission and have that money transferred to the DMV branch budget for collecting this fee that the counties have imposed.
SENATOR O’DONNELL MOVED TO AMEND THE MOTION TO APPROVE DECISION ITEM 3 IN BUDGET ACCOUNT 101-4722 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION AND TO AUTHORIZE LEGISLATION FROM THE SUBCOMMITTEE TO ALLOW THE DEPARTMENT OF MOTOR VEHICLES AND PUBLIC SAFETY TO RETAIN A COMMISSION TO COVER COSTS ASSOCIATED WITH ASSESSMENT AND COLLECTION OF THE FEES.
ASSEMBLYWOMAN CHOWNING SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL AND ASSEMBLYMEN PERKINS AND BEERS WERE ABSENT FOR THE VOTE.)
* * * * *
Chairman Parks:
I was informed that the Joint Subcommittee on Human Resources/K-12 took action this morning to recommend transfer of approximately $60,000 to the Health Division. There is the next item in front of us.
Mr. Abba:
In the Health Division there is a budget account called “Health Aid to Counties.” It has General Fund appropriation and pollution control funding, which is then transferred to Clark and Washoe health districts for their efforts in maintaining the statutory responsibilities for health related activities. Part of the money that is transferred to the county health districts is used for pollution control programs. The “Health Aid to Counties” budget is based on projected population growth in those two counties, and we historically have proportioned a small increase in the transfer from this particular budget to the Health Division for its pollution control budgets.
Senator O’Donnell:
As I understand it, this $6 fee is to establish this huge air pollution and health issue committee. Are we still paying for these other little things that the Clark County Board of Commissioners has asked for in terms of $60,000 a year? In other words, are we closing this budget still allocating funds out to these various agencies when in fact the Clark County Board of Commissioners is combining them all under the $6 fee?
Mr. Abba:
I cannot respond to that question. What I can respond to is the way that particular account in the Health Division is built. It is based on a per capita growth and if this money is not included as part of the transfer based on a per capita growth we would have to add General Fund in lieu of these particular types of funds.
Senator O’Donnell:
My question is why do we have to add General Funds when in fact there is going to be an “up to $6 fee” charged on every vehicle that is going back to the counties. They have a $3 million annual charge. Are you saying they cannot fund $60,000 out of a $3 million per year fund?
Chairman Parks:
You have a good point there, Senator.
Mrs. Chowning:
The only way I would agree to approve this is subject to change at a later date. We need to have this documented. There is no sense in establishing the ability to generate a big amount of money if it will be on top of the other. I assume this $60,000 would be $40,000 for Clark County and $20,000 for Washoe County. I would move for approval, but our subcommittee would delete this later based upon more defined information from subcommittee staff.
Chairman Parks:
I think we all understand that, but I would add that it is pending approval of S.B. 357.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE DECISION ITEM 6 IN BUDGET ACCOUNT 101-4722 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO THOSE ADJUSTMENTS RECOMMENDED BY STAFF AND PENDING SUBCOMMITTEE REVIEW IN THE FUTURE AND APPROVAL OF S.B. 357.
SENATOR JACOBSEN SECONDED THE MOTION.
Chairman Parks:
Is there any further discussion on the motion?
Senator O’Donnell:
I am not going to vote on this motion. I want to hold this budget account until I get a handle on what is happening with this fee.
Chairman Parks:
We have lost our quorum, so we will have to hold this and, unfortunately, both houses have a floor session at 10:30 a.m. Given the time, we have to adjourn this hearing. I apologize to those who came here today that we were unable to accommodate them by hearing their budgets.
Chairman Parks adjourned the hearing at 10:31 a.m.
RESPECTFULLY SUBMITTED:
ElizaBeth Root
Committee Secretary
APPROVED BY:
Mr. David R. Parks, Chairman
DATE:
Senator Lawrence E. Jacobsen, Chairman
DATE: