MINUTES OF THE
SENATE Committee on Finance
Seventy-First Session
May 25, 2001
The Senate Committee on Financewas called to order by Chairman William J. Raggio at 8:17 a.m., on Friday, May 25, 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.
COMMITTEE MEMBERS PRESENT:
Senator William J. Raggio, Chairman
Senator Raymond D. Rawson, Vice Chairman
Senator Lawrence E. Jacobsen
Senator William R. O’Donnell
Senator Joseph M. Neal Jr.
Senator Bob Coffin
COMMITTEE MEMBERS ABSENT:
Senator Bernice Mathews (Excused)
STAFF MEMBERS PRESENT:
Gary L. Ghiggeri, Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Debra Petrelli, Committee Secretary
OTHERS PRESENT:
Assemblyman Greg Brower, Assembly District No. 37
Pamela B. Wilcox, Administrator and State Land Registrar, Division of State Lands, State Department of Conservation and Natural Resources
Don Hataway, Deputy Director, Budget Division, Department of Administration
Bill Moell, Chief, Purchasing Division, Department of Administration
Senator Raggio drew attention to Senate Bill (S.B.) 277. He said this bill was passed on the Senate Floor.
SENATE BILL 277: Requires posting of sign in certain food establishments in which alcoholic beverages are sold that warns of dangers of drinking such beverages during pregnancy. (BDR 40-24)
Senator Raggio introduced a letter addressed to Senator Valerie Wiener from March of Dimes, Nevada Chapter, in Las Vegas (Exhibit C). He said it guarantees the coverage of the cost associated with the production and distribution of the signage mandated in S.B. 277.
BILL DRAFT REQUEST (BDR) 43-1561: Revises provisions governing certain fees charged by department of motor vehicles and public safety and transfers of money to state highway fund. (Later introduced as S.B. 578.)
Senator Raggio stated that BDR 43-1561 relates to the Department of Motor Vehicles and Public Safety (DMV&PS) and the committee had requested this bill draft. He asked what BDR 43-1561 consists of.
Gary L. Ghiggeri, Senate Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, responded that this bill draft provides for implementation of the closing actions of the committee. He said it decreases the carry-forward amount in the insurance verification account from $1 million to $500,000. He added that it also changes the statutory authority for the establishment of a photo license fee, which allows DMV&PS to administratively establish the fee in order to cover the cost of the photo license fee.
Senator Coffin asked what the approximate fee of the photo license would be. Mr. Ghiggeri responded he believes it is just over $2. He added it will not be effective immediately, but should be effective by March 2002, at approximately $2.40. He pointed out the process has changed from a Polaroid picture to a digitized photo.
SENATOR O’DONNELL MOVED TO INTRODUCE BDR 43-1561.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS MATHEWS AND NEAL WERE ABSENT FOR THE VOTE.)
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SENATE BILL 519: Provides for establishment of programs for re-entry into community of certain prisoners and parolees and revises provisions regarding sealing of records. (BDR 16-1477)
Senator Raggio commented there is a third reprint of S.B. 519 with two amendments to this bill, which are Assembly Amendment 719 and Assembly Amendment 864.
Senator Raggio stated S.B. 519 recommends a program for re-entry, into the community, of prisoner and parolees. He added that it also deals with the sealing of records. He asked whether Mr. Ghiggeri had a chance to review these amendments. Mr. Ghiggeri responded he had looked at them. He said the amendments basically reinsert some existing language and strengthen what is in the statute without changing the legislation.
Senator Raggio asked whether the committee objected to either amendment added by the Assembly.
SENATOR RAWSON MOVED TO CONCUR WITH THE ASSEMBLY ON S.B. 519.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS MATHEWS AND NEAL WERE ABSENT FOR THE VOTE.
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ASSEMBLY BILL 177: Authorizes issuance of general obligation bonds to carry out Environmental Improvement Program in Lake Tahoe Basin. (BDR S-701)
Assemblyman Greg Brower, Assembly District No. 37, stated Assembly Bill (A.B.) 177 came from an interim committee, of which he was the chairman, which oversees the Tahoe Regional Planning Agency (TRPA). He added the bill continues with the bonding authority that was authorized last legislative session via the approval of A.B. 285 of the Seventieth Session. He pointed out that A.B. 285 of the Seventieth Session established a maximum of $53.2 million in bonds to fund environmental improvement projects in the Lake Tahoe Basin through 2007. This legislation authorized the issuance of $3.2 million in general obligation bonds over the 1999-01 biennium.
ASSEMBLY BILL 285 OF THE SEVENTIETH SESSION: Establishes program to protect Lake Tahoe Basin. (BDR S-459)
Mr. Brower continued that A.B. 177 is simply the second installment of that bonding authority in A.B. 285, and the projects to be funded for the next biennium are detailed on page 3 of A.B. 177. He added the amount of the second installment is approximately $16.2 million. He said it is a requirement of the original legislation that the money committees in each house reauthorize the bonding in each biennium for each installment.
Senator Raggio asked whether these projects have been determined, and whether everybody concerned is in agreement with these projects. Mr. Brower replied the projects to be undertaken have been determined and everyone is in agreement. Senator Raggio inquired what the federal commitment would be on this bill.
Pamela B. Wilcox, Administrator and State Land Registrar, Division of State Lands, State Department of Conservation and Natural Resources, commented the Federal Government is a much larger entity than any of the others participating in this measure. She added there are many federal government agencies involved with Lake Tahoe. She commented that last year the Lake Tahoe Restoration Act passed. The act was sponsored by delegations from Nevada and California. She added this should enable federal funding to continue.
Senator Raggio asked what the federal government’s total commitment is for this bill. Ms. Wilcox responded that the federal government’s total commitment is approximately $297 million, and the bill also commits $300 million for the Lake Tahoe Restoration Act.
Senator Raggio asked about the status of that commitment. Ms. Wilcox replied, “That bill is through, it’s complete, it’s adopted.” Ms. Wilcox commented it will be necessary to go back to the U.S. Congress every year for appropriations under that act. That act, she noted, authorizes the federal governments commitment.
Senator Rawson pointed out that A.B. 615, which is a park bond, includes a measure pertaining to Lake Tahoe. He said A.B. 615 authorizes $200 million in natural resource projects. He asked whether A.B. 177 is separate from A.B. 615. Ms. Wilcox replied the park bond (A.B. 615) is totally different; it is a statewide park and wildlife bond act. She added it includes funds for both state agencies and the local governments for a variety of park and wildlife purposes. She reiterated that it is completely separate from A.B. 177.
ASSEMBLY BILL 615: Requires submission to voters of proposal to issue general obligation bonds to protect, preserve and obtain benefits of property and natural resources of state. (BDR S-1463)
Senator Coffin asked what the additional amount is that is being considered. Senator Raggio commented that he does not believe there is any additional amount, but rather the committee is authorizing the usage of existing authority. Ms. Wilcox stated that is correct. She added the entire authority was $53.2 million, with $3.2 million of that being authorized during the last biennium. She said the request for authority this biennium is for $16.2 million, and the remainder can be requested in the future.
Senator Coffin asked what the total interest cost is to finance these bonds. Ms. Wilcox replied she did not know. Senator Coffin pointed out the funding comes from the General Fund. Ms. Wilcox responded they are general obligation bonds deriving from the 15-cent property tax rate. Senator Coffin stated he is curious what the state’s interest cost is for this specific use.
Don Hataway, Deputy Director, Budget Division, Department of Administration, stated he does not know the specifics, but the principal in interest is built into the Bond Interest & Redemption Budget Account 395-1082. He pointed out that it is funded through the 15-cent property tax rate. He said it takes into consideration the bond cash-flow analysis, which is in addition to the Capital Improvement Programs (CIPs). He added, to furnish information in specific dollars and relate the term of the current payment, he would have to collect that data for the committee.
Senator Coffin commented, “We’re pouring all this money into Lake Tahoe, and it’s a worthy project, but I need to get a handle on our annual obligation.” Mr. Hataway stressed that in the division’s projections, they take all of the data into consideration. He added that he would supply the committee with that information.
Senator Raggio stated this is the agreement that Governor Miller entered into with California and with the Federal Government approximately four years ago. Ms. Wilcox remarked that agreement was made in 1997.
Mr. Brower said in addition to Nevada meeting its commitment, California has more than met its commitment. He pointed out that California pays a significantly larger share than Nevada.
Ms. Wilcox commented that A.B. 285 of the Seventieth Session, passed last legislative session, requires a status report to be given to the legislature each year.
ASSEMBLY BILL 285 OF THE SEVENTIETH SESSION: Establishes program to protect Lake Tahoe Basin. (BDR S-459)
She added she has a power-point presentation if time is allowed. Senator Raggio remarked the committee did not have time to view a power-point presentation, but would like the information submitted in written form. She presented a State of Nevada Lake Tahoe environmental improvement projects status (Exhibit D) to the committee for their review.
SENATOR RAWSON MOVED TO DO PASS A.B. 177.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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ASSEMBLY BILL 605: Makes various changes relating to state purchasing fund. (BDR 27-1315)
Bill Moell, Chief, Purchasing Division, Department of Administration, pointed out from his written testimony (Exhibit E) that A.B. 605 provides a mechanism for funding of customer-to-vendor direct purchasing through the potential of an e‑commerce solution. He pointed out that A.B. 605 does not authorize the expenditure of funds. He explained that authorization would come from the Interim Finance Committee (IFC) after a request for proposal (RFP) process to provide more details about a recommended solution.
Mr. Moell pointed out this bill provides a reasonable expectation of funding to allow for the RFP to proceed. He said the bill proposes to utilize no more than $150,000 per year of Purchasing Fund dollars to implement the Nevada Mall and other potential e-commerce opportunities to improve customer service.
Mr. Moell said the Purchasing Fund was established in Nevada Revised Statutes (NRS) 333.120 at $1,250,000 when all transactions were processed through the Purchasing Fund. That amount provided cash flow for receipts and disbursements incumbent with that business model, he added.
Mr. Moell commented, “The IFS (Integrated Financial System) does not utilize the Purchasing Fund in a similar way and has made available a unique opportunity to transition to on-line procurement system for low dollar, high volume purchases.”
Mr. Moell said the division proposes a fund minimum of $500,000 in 5 to 10 years. He added the Purchasing Division recognizes the need to acquire goods and services for customers more quickly and with best value. He remarked that the division has pioneered multiple award contracts giving its customers choices. The division also has multi-state contracts leveraging buying power beyond the borders of Nevada, he added.
Mr. Moell indicated the division has more open-term contracts than ever before, facilitating purchase orders that once required bidding. He pointed out the division now has an opportunity to take a quantum leap into the world of better service. He said the division is poised to move forward with the Nevada Mall project, which is a password-protected, web-based shopping mall. He said it will allow customers, both state and local, to shop for goods and services to meet their operational goals.
Mr. Moell said agency-to-approved-vendor contact would be direct rather than through the Purchasing Division. He added that his staff would become contract managers. He pointed out that there will be substantial savings in “soft dollars” time to process orders, and in the speed of the receipt of goods. He added that approval and oversight will be electronic. He said the custom-password access would access ten or more catalogs from open-term contract vendors. He stated he urged support of A.B. 605.
Senator Raggio asked Mr. Hataway whether this was his proposal from the Budget Division. Mr. Hataway responded it was.
Senator Raggio commented that Senator O’Donnell had been excused from the meeting.
SENATOR JACOBSEN MOVED TO DO PASS A.B. 605.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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Mr. Ghiggeri stated, during the closing of the Department of Motor Vehicles and Public Safety’s budget, there was mention of utilizing administrative assessments to fund half of the match requirement for the narcotics control budget. He pointed out that funding entirely with forfeitures had originally been recommended. He added the motion was contingent on the court assessments being available. He said the Fiscal Division has researched this issue and found there are no court assessments available to provide the match.
Mr. Ghiggeri explained the match for budget account 101-3744 (Public Safety, Narcotics Control) will be funded via forfeitures as originally recommended by the subcommittee. Senator Raggio commented that was the alternative.
Mr. Ghiggeri remarked that he recently received a request from the Budget Division for a supplemental appropriation in the amount of $184,000 for the Nevada Department of Prisons (NDOP) for utilities at the Southern Desert Correctional Center for Fiscal Year (FY) 2001. Senator Raggio asked whether that is the current year and whether a supplemental bill is required. Mr. Ghiggeri replied that is the current year. He recommended that the request be put into a separate bill rather than amending it into another bill. He stated he would not want to put this request in a “one-shot” bill.
Mr. Hataway indicated the Budget Division has a couple of alternatives to this issue. He said, “This is kind of a cushion. They think they need it, but we could wait until the end of the year, strip money out of all the budgets and move it around and come for an IFC contingency allocation at the end of the year.” He added the division feels it would help bill payments now, and then the division would revert any dollars left over at the end of the year.
Senator Raggio commented that he agrees this is a better approach to the situation.
SENATOR RAWSON MOVED TO OBTAIN A BILL DRAFT REQUEST FOR SUPPLEMENTAL APPROPRIATION FOR THIS PURPOSE.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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SENATE BILL 8: Directs Legislative Commission to appoint subcommittee to continue study of long-term care in this state. (BDR S-300)
Senator Raggio commented that S.B. 8 was heard twice in this committee on February 26 and May 3. He pointed out that it directed a study by the legislative committee on long-term care. He said since S.B. 402 has passed, he believes S.B. 8 is unnecessary.
SENATE BILL 402: Expands authority of legislative committee on health care to review certain issues relating to long-term care. (BDR 40-972)
SENATOR RAWSON MOVED TO INDEFINITELY POSTPONE S.B. 8.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
SENATE BILL 321: Makes various changes relating to state plan for Medicaid. (BDR 38-313)
Senator Raggio said this measure was heard on April 5. He commented that it involves a state plan for Medicaid. It is impractical because of the heavy fiscal impact, he added. He noted that Sections 1 and 2 of S.B. 321 deal with this issue. He said that Section 3 of S.B. 321, which transfers $500,000 from the Intergovernmental Transfer Program Account to the fund for medically indigent care, is still needed. He added that Section 4 of S.B. 321, which deals with the effective date, is also needed.
SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 321, BY DELETING SECTIONS 1 AND 2 OF THE BILL.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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Senator Raggio commented that there is a long list of “one-shot” items that the Governor has proposed that can be reduced or modified.
SENATE BILL 437: Makes appropriation to National Judicial College to assist in securing public and private grants and other funding for support during 2001-2003 biennium. (BDR S-1371)
Senator Raggio stated that S.B. 437 was heard on April 9. He said this is an appropriation to the National Judicial College. He noted, in its original form, the proposed appropriation was $600,000, and the recommendation is to reduce that amount to $450,000.
SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 437, BY REDUCING THE APPROPRIATION TO $450,000.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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SENATE BILL 438: Makes appropriation to Louis W. McHardy National College of Juvenile and Family Justice to assist in securing public and private grants and other funding for support during 2001-2003 biennium. (BDR S-1373)
Senator Raggio said that S.B. 438 was heard on April 9. This is the appropriation to the National College of Juvenile and Family Justice, he added. He commented, in its original form, it recommended an appropriation of $303,600. He said the recommendation reduces this appropriation to $250,000.
SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 438, BY REDUCING THE APPROPRIATION TO $250,000.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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SENATE BILL 427: Makes appropriation to Department of Education for training of teachers, textbook resources and information technology. (BDR S-1349)
Senator Raggio stated there have been ongoing discussions regarding how to fund measures increasing teachers’ cost of living allowances (COLAs) in S.B. 427, along with other items of concern in K-12 (Kindergarten through Twelfth grade). He said part of the Governor’s recommended proposal, in addition to a bonus and/or COLA, is that an incentive should be provided for new-hire teachers in both the first and second years of the biennium.
Senator Raggio said the draft proposed amendment for S.B. 427 (Exhibit F) (later known as Amendment Number 1083) creates a fund of $10 million that would allow an incentive-signing bonus for new-hire teachers. He added that in the first year the bonus would be as much as $2,000, and in the second year of the biennium it would be increased to as much as $2,500 per new-hire teacher.
Senator Raggio remarked the funding would be $10 million from the state General Fund. The remaining $10 million would be applied to technology, he added. He drew attention to Exhibit F, and said Section 1 on page 3 covers the $10 million signing bonuses to new teachers. He said pages 1 and 2 of Exhibit F, submitted by the Commission on Educational Technology, is a proposal that sets out the allocation for the $10 million. He added all but $50,000 of that $10 million would be distributed as grants to local school districts that wish to reach the minimum level of educational technology.
Senator Raggio pointed out that this is consistent with the commitment for a network computer for every classroom. He said total funding would be $1,250,000 for the first year and $1,250,000 for the second year of the biennium. He added it would grant local school districts the upgrade and replacement of software, totaling $2.5 million each year of the biennium, which includes distance learning.
Senator Raggio said that it also grants contracting ability to local school districts for the enhancement of technical support, totaling $625,000 each year of the biennium. He added the amendment includes a provision for the commission to grant to local school districts $150,000 each year of the biennium for pilot programs on the best uses of educational technology.
Senator Raggio commented this proposed amendment authorizes the Commission on Educational Technology to grant $500,000 to the Division of State Library and Archives, licenses to allow school libraries access to research databases and other on-line resources appropriate for pupils. Additionally, he added, this measure would fund S.B. 385.
SENATE BILL 385: Authorizes expenditures from state distributive school account for educational technology for school libraries. (BDR S-1216)
Senator Raggio pointed out, on page 1 in Section 2 of Exhibit F, it additionally gives the Commission on Educational Technology the authority to determine the amount of money that must be distributed to school districts based upon the needs of each school district. He concluded that, on page 2 in Section 3 of Exhibit F, $50,000 is provided to the Legislative Bureau of Accountability and Program Evaluation for an evaluation of the effectiveness of technology in improving the pupil achievement implementation issues and the best uses of technology.
Senator Raggio asked Mr. Hataway whether he had any opposition to this suggested proposal. Mr. Hataway replied he does not.
Senator Raggio added the Governor has discussed this bill with the chairman of the Assembly Committee on Ways and Means, and, hopefully, it can be processed as an emergency measure. He said the reason is because letters have already been sent out to teachers, and the Governor would like to add this measure for the bonuses as an incentive to new‑hire teachers.
SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 427.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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Senator Coffin, calling attention to the discussions held between the Governor and the chairman of the Assembly Committee on Ways and Means, asked whether there was any talk concerning what this bill does towards teachers that are already employed. Senator Raggio responded that this is just a one-time signing bonus and does not change any base salaries. Senator Coffin clarified he was concerned that it would put a new-hire teacher’s total compensation package above the others. Senator Raggio reiterated that this is one-time signing bonus. He added that Clark County, particularly, which is having the problem of recruiting teachers, is quite anxious to have this incentive available.
Gary Ghiggeri stated that based on the action taken on S.B. 427, he surmised that S.B. 385 is no longer required.
SENATOR RAWSON MOVED TO INDEFINITELY POSTPONE S.B. 385.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS O’DONNELL AND MATHEWS WERE ABSENT FOR THE VOTE.)
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Senator Raggio adjourned the meeting at 9:14 a.m.
RESPECTFULLY SUBMITTED:
Debra Petrelli
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE: