SENATE COMMITTEE ON FINANCE

MINUTES OF THE

SENATE Committee on Finance

Seventy-First Session

March 21, 2001

The Senate Committee on Financewas called to order by Chairman William J. Raggio at 8:10 a.m., on Wednesday, March 21, 2001, in Room 2134 of the Legislative Building, Carson City, Nevada. The meeting was videoconferenced to the Grant Sawyer Office Building, Room 4401, Las Vegas, 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

Senator Bernice Mathews

GUEST LEGISLATORS PRESENT:

Assemblywoman Ellen Marie Koivisto

STAFF MEMBERS PRESENT:

Gary L. Ghiggeri, Fiscal Analyst

Bob Guernsey, Principal Deputy Fiscal Analyst

Marla McDade Williams, Senior Research Analyst

Jennifer Ruedy, Committee Secretary

OTHERS PRESENT:

John P. Comeaux, Director, Department of Administration

Michael Goodwin, Manager, Accessible Space, Inc., Sparks

Maynard and Esther Meyers, Private Citizens

Joan Anglin, Private Citizen

Rebecca Billey, Personal Care Assistant

Kevin Cord, Private Citizen

Shelbie Cord, Private Citizen

Cindy Allen, Private Citizen

Mary Hritz, Private Citizen

Carla Sloan, State Director, American Association of Retired Persons

Paul Gowins, Disability Forum and Rehabilitation Program Specialist II, Community Based Services, Rehabilitation Division, Department of Employment, Training and Rehabilitation

Thomas Frederick, Home and Community Based Services Administrator, Accessible Space, Inc.

Robert Desruisseaux, Representative, Northern Nevada Center for Independent Living

Connie Bobo, Executive Director, The ALS Association

Donny Loux, Chief, Planning, Research and Program Development, Rehabilitation Division, Department of Employment, Training and Rehabilitation

Nancy Keller, Registered Nurse Case Manager, Sunrise Hospital and Medical Center

Cheryl Dinnell, Chairwoman, Nevada Respite Coalition

David C. Love, Lobbyist, Bethel Renaissance Aging Council, Nevada Respite Care Coalition, and Grandparents Raising Grandchildren

Ginny Oldham, Private Citizen

Phillip Manti, Private Citizen

Judy Walsh, Family Case Manager, Family Support Council, Douglas County

Dorothy S. Pomin, Lobbyist, Sierra Association of Foster Families

Bart Archambeau, Private Citizen

Christine Hendrix, Private Citizen

Alicia Smalley, Lobbyist, National Association of Social Workers

Jon L. Sasser, Lobbyist, Washoe Legal Services Inc., Clark County Legal Services Inc., Nevada Legal Services Inc., and Washoe County Senior Law Project

Charles Duarte, Medicaid Administrator, Division of Health Care Financing and Policy, Department of Human Resources

Walter LeVasseur, Private Citizen

Janet L. Gilbert, Lobbyist, Progressive Leadership Alliance of Nevada

Bobbie Gang, Lobbyist, Nevada Women’s Lobby

Joe Arrascada, Private Citizen

Mary Liveratti, Administrator, Aging Services Division, Department of Human Resources

Robin Keith, Lobbyist, Nevada Rural Hospital Project Foundation

Lorne J. Malkiewich, Director, Legislative Counsel Bureau

Wm. Gary Crews, CPA, Legislative Auditor, Audit Division, Legislative Counsel Bureau

Claire Jesse Clift, Secretary of the Senate, Nevada Legislature

Jacqueline Sneddon, Chief Clerk of the Assembly, Nevada Legislature

Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau

Robert E. Erickson, Research Director, Research Division, Legislative Counsel Bureau

Senator Raggio requested motions to introduce one bill draft request (BDR).

BILL DRAFT REQUEST 48-530: Makes various changes concerning the adjudication emergency account. (Later introduced as Senate Bill 465.)

SENATOR RAWSON MOVED TO INTRODUCE BDR 48-530

SENATOR JACOBSEN SECONDED THE MOTION.

THE MOTION CARRIED. (SENATORS NEAL AND COFFIN WERE ABSENT FOR THE VOTE.)

*****

Gary L. Ghiggeri, Fiscal Analyst, Legislative Counsel Bureau, presented the sales and gaming percentage fees information for the month of January, which he explained his office had received only the day before. He stated that collections were up 5.8 percent, and the change in taxable sales was 5.5 percent for the month of January. He said year-to-date collections for taxable sales are up 5.1 percent, but this is short of the Economic Forum projection of 5.9 percent. He referred committee members to the last page of his handout Exhibit C for a detailed comparison with Economic Forum projections. He explained the growth rates in percentage gaming fees and sales tax that must be achieved during the remainder of the fiscal year to achieve the Economic Forum’s forecasted growth for the current fiscal year; the detailed information is found in the handout. He explained that the bottom of the last sheet illustrates reductions that would be realized only in the sales tax area based on collections.

Senator Raggio cautioned the committee members to pay close attention to the details of the report because the figures indicate that sales and gaming percentage fees will be significantly below the Economic Forum projections.

Senator Neal said it appears, despite the gaming industry reporting large profits to Wall Street, they are reporting a slowdown to this committee.

Senator Raggio responded that the committee must act on the information the gaming industry provides to the Legislative Counsel Bureau (LCB).

Mr. Ghiggeri noted that the sales tax figures on the last sheet do not reflect the required adjustments to the Distributive School Account based on any revised growth factors, which would nearly double those amounts.

Senator Raggio stated that this report would be discussed in greater detail at the committee meeting on Thursday.

SENATE BILL 144: Revises provision relating to payment of certain transitional expenses for governor-elect. (BDR 18-391)

John P. Comeaux, Director, Department of Administration, pointed out that Senate Bill (S.B.) 144 would amend Nevada Revised Statute (NRS) 223.025. Presently, a $5,000 appropriation is included within the Department of Administration’s budget for the transitional expenses for the governor-elect. He explained that the recent transition cost considerably more than $5,000, so the proposed legislation will replace the specific dollar figure with language to allow for “a reasonable amount.”

Senator Raggio asked whether the bill still provides for legislative appropriation. Mr. Comeaux confirmed that it would. Senator Raggio closed the hearing on S.B. 144.

SENATE BILL 174: Requires cooperative efforts to make available through existing state programs adequate community-based services to provide essential personal assistance to certain persons with disabilities. (BDR 38-190)

In an effort to accommodate the large number of people indicating their desire to testify, Senator Raggio requested concise, non-duplicative remarks from everyone.

Senator Rawson explained this bill is intended to provide essential personal assistance to the small segment of the population that is unable to get out of bed, eat breakfast, or use the restroom without help. He pointed out that all of these people were fully functioning individuals until they were affected by accident or illness, and 80 percent of the assistance they receive is from their families. He said the psychological effects on the family are tremendous, typically resulting in “feelings of guilt and obligation . . . overwhelmed by the magnitude of the effort.” Bankruptcy, divorce, fragmentation of families often results from the stress of providing this assistance to a family member, he added. He commented that the annual cost of maintaining one of these individuals in a nursing home is approximately $60,000 versus an annual cost of $15,000 for a personal care assistant. He summarized that the personal care assistant is a cost-effective approach that also provides a better quality of life for the individuals and their families. He asked that the committee consider the scope of the problem in its future budget decisions.

Senator Raggio commented that the bill provides for an advisory committee on personal assistance. He questioned the purpose of the advisory committee.

Senator Rawson said the purpose of the advisory committee is to provide greater accuracy and familiarity in the determination of personal assistance needs than an existing state agency, which may be somewhat dispassionate.

Senator Raggio pointed out that the bill includes a $250,000 appropriation to accomplish its purpose. He asked why this particular bill requires a two-thirds majority vote.

Senator Neal responded that Section 11 of the bill requires a copayment based on a sliding scale proportionate to the recipient’s income. Senator Raggio stated that language does not warrant a two-thirds majority vote requirement.

Senator Rawson said there might have been a concern that this established a new entitlement program, which it doesn’t. Senator Raggio responded that theoretically, that is only applicable if a new fee or tax is created. Senator Raggio stated that staff from the Legal Division of the LCB should address this matter.

Michael Goodwin, Manager, Accessible Space, Inc., explained that his organization assists individuals to bathe, to prepare meals, and to get out of bed in the morning. He explained that they operate on limited funds. He provided a packet of letters (Exhibit D) from his customers written in support of S.B. 174.

Senator Raggio asked what their funding source is. Mr. Goodwin replied they receive funding from Community Based Services in Carson City.

Mr. Goodwin stated his support of S.B. 174. He cited a waiting list of approximately one hundred people of which forty-one people had to be placed in nursing homes. He pointed out that it would be more cost-effective to maintain those individuals in their homes with minimal assistance. He commented that many people who currently receive their services are present to testify in support of the bill, and he is speaking for those people on the waiting list. He introduced the first recipients, Maynard and Esther Meyers.

Maynard Meyers stated that his wife Esther was diagnosed with multiple sclerosis in 1963 shortly after the birth of their fourth child. He said she has been confined to a wheelchair for the past thirty years, and the personal care attendants enable him and his wife to stay at home together. Mr. Meyers, who is 75 years old, has had two heart surgeries, and he is unable to provide the necessary care for his wife.

Joan Anglin testified as a private citizen in support of S.B. 174. She explained that she is ineligible for Medicaid. She said she broke her neck ten and a half years ago, which resulted in her becoming a quadriplegic. Her income can support co-payment for services but not the full amount of the support, she added. She explained that the personal care assistance enables her to live in her own home, be active in her community and continue to care for three mentally disabled men who have lived with her for the past twenty-five years. Her family initially provided her day-to-day care, but the personal care assistance she has received four hours each day since July 1991 has allowed her to enjoy her family. She said her family continues to help her when necessary, but she is not a burden to them. She explained that three years ago she started a program using her expertise working with mentally handicapped people to teach them to work in a structured environment with horses. With the help of dedicated friends and employees, she is able to find employment for these people at other ranch and horse facilities, she added. She said the program is unique on the West Coast of the United States.

Ms. Anglin stated that minimal assistance enables other people in similar situations to return to work and contribute to the state. This bill will help identify other people in similar situations and determine whether they possess the financial means to support themselves, she added. She said she believes anyone could find himself or herself severely disabled at any time, and disabled people want the opportunity to live independently and with dignity.

Senator Raggio commended her for everything she has been able to accomplish, and asked her to introduce the assistant with her. Ms. Anglin introduced her personal care assistant Rebecca Billey.

Mr. Goodwin introduced Kevin Cord.

Kevin Cord testified in support of S.B. 174 as a private citizen. He introduced his daughter Shelbie, who accompanied him. Senator Raggio welcomed Shelbie. He explained that he became a quadriplegic as a result of a traumatic accident in 1996, and the personal care assistance allows him and his family to enjoy a better quality of life. He commented that he is presently attending Truckee Meadows Community College (TMCC), and his wife works full-time.

Senator Raggio asked how frequently Mr. Cord receives assistance from the personal care attendants. Mr. Cord responded that he receives assistance two hours every morning and every evening for a weekly total of twenty-eight hours.

Mr. Cord expressed his appreciation for the committee’s favorable consideration of the bill. Senator Raggio thanked him for his efforts.

Mr. Goodwin introduced Cindy Allen, who has had chronic progressive multiple sclerosis since 1985. Ms. Allen introduced her personal care attendant Sue McGill. She attested to the necessity of personal care attendants for people in similar situations, and she urged the committee to pass the bill so others would benefit from their services also.

Mr. Goodwin introduced Mary Hritz, who has muscular dystrophy. He mentioned that Accessible Space Inc. of Sparks provides personal care assistance to communities as far away as Yerington. Ms. Hritz testified in support of this bill. She explained that prior to receiving personal care assistance, her husband provided all of her care. She stated that her husband was weakened by triple bypass surgery and subsequently dropped her. She said she suffered multiple fractures in both legs. The personal care assistance she now receives provides her with reliable, safe care, which bolsters her self-esteem and independence. She introduced her personal care attendant, Kimberly.

Carla Sloan, State Director, American Association of Retired Persons, testified from Las Vegas that personal care assistance is “the cornerstone of independent living.” She stated her support of the bill.

Paul Gowins, Disability Forum and Rehabilitation Program Specialist II, Community Based Services, Rehabilitation Division, Department of Employment, Training and Rehabilitation, provided a written statement (Exhibit E) prepared by Ralph Baker Ph.D. in support of S.B. 174 and S.B. 207.

SENATE BILL 207: Requires department of human resources to establish program for provision of medical assistance to certain working persons with disabilities who are ineligible for Medicaid. (BDR 38-227)

Mr. Gowins explained Dr. Baker survived nine years without a personal care attendant after an auto accident in 1976 left him a quadriplegic. Mr. Gowins indicated that he and Dr. Baker worked closely for many years to develop the original personal attendant care program, which was initiated in 1985. He explained, in their efforts to establish the program, they appealed to the Legislature many years ago after being rejected by every state agency they had approached. According to Mr. Gowins, upon hearing their stories, Assemblyman Marvel, who was the Chairman of the Assembly Ways and Means Committee, “became infuriated” and approved the program that session.

Mr. Gowins stated that every session he is forced to return to the Legislature to request funding, and he would prefer that the need be automatically recognized and funded each session. He said he supports S.B. 174 and recognizes the importance of identifying the number of disabled people who need personal care attendants. He said this is a “sunshine bill” that illuminates an issue many people would prefer to ignore.

Senator Raggio acknowledged that Mr. Gowins is a powerful advocate for the disabled. He stated all of the testimony had not “fallen on deaf ears,” as most people have personal contact with someone in a similar situation. He said he recognizes there is a legitimate need.

Thomas Frederick, Home and Community Based Services Administrator, Accessible Space, Inc., testified from Las Vegas in support of the bill, and he provided a written statement (Exhibit F). He stated that the Personal Assistance Services (PAS) provided by his organization enable some clients to maintain employment; however, most of the clients cannot work. PAS enables them to avoid a nursing home and to live independently in their own home or apartment, he added. He explained that their clients do not qualify for other funding for a variety of reasons: too many financial resources for Medicaid, health insurance is capped, which renders them uninsurable, and permanent on-going medical needs. Mr. Frederick cited two examples of clients unable to procure PAS services elsewhere. The first client has amyotrophic lateral sclerosis (ALS), and his family is on the brink of bankruptcy attempting to provide 24-hour care for him, he stated. His second example is a woman with muscular dystrophy who has no family members to provide the necessary care for her.

Mr. Frederick pointed out there are approximately one hundred people on their waiting list for services at Accessible Space, Inc. He said the current PAS program costs $15,228 per person, per year, and recent Medicaid data indicates annual nursing home costs for one person are at $59,732. He expounded that for one-fourth the cost of a nursing home, their program enables people to remain in their homes and enjoy a better quality of life. He urged support of this bill and expansion of PAS programs.

Robert Desruisseaux, Representative, Northern Nevada Center for Independent Living, testified in support of S.B. 174. He referred committee members to the last page of his handout (Exhibit G) for a list of organizations supporting this bill. He said the recipients of PAS are productive members of society who are able to return to school to learn new skills or to return to their previous lines of work. He pointed out that it makes economic sense to support people to become taxpayers in lieu of tax-consumers. He said he believes that the $250,000 fiscal note is not appropriate because the program cost would be “closer to the number of $3,000 to $5,000 . . . to cover per diem expenses for the advisory committee.” He said the intent of the bill is not to create a new program, but to provide adequate funding for existing programs.

Senator Raggio stated the committee would note his comment regarding the expected costs.

Connie Bobo, Executive Director, The ALS Association, testified from Las Vegas on behalf of the numerous Nevadans stricken with ALS. The annual care costs for each of their patients is $200,000, and family members care for 80 percent of the ALS patients in the state, she commented. She added that 77 percent of those caregivers are spouses and 41 percent of those spouses provide care twenty-four hours a day seven days a week. She stated she would like to provide additional assistance during critical times not replace family-provided care. She cited a recent example when a broken hip temporarily disabled the wife of an ALS patient, and her husband was placed in a group home during her recovery. The man paid approximately $2,000 for his stay at the group home, she added. She explained the wife is now struggling to care for her husband in her weakened condition with a mere three weekly visits from a personal care attendant covered by insurance.

Ms. Bobo pointed out that PAS is not covered by insurance for ALS patients because it is a terminal disease without any known medical treatment. She explained that insurance considers assistance for ALS patients custodial not medically necessary. She said caregivers who provide assistance without any relief inevitably become patients themselves. She stated her support for this bill and provided a written statement (Exhibit H).

Donny Loux, Chief, Planning, Research and Program Development, Rehabilitation Division, Department of Employment, Training and Rehabilitation, testified on her own behalf and provided a written copy of her testimony (Exhibit I) in support of S.B. 174. She stated that she has worked with families seeking personal care assistance for fifteen years, and she has repeatedly had to tell them there is a waiting list of one to two years for care. She cited two personal incidences that made her acutely aware of the dire need that exists within the community for PAS. Now, she feels the anguish and frustration of the families she works with even more profoundly than before her experiences. She said:

Some people say that if you recognize these people and their suffering in the budget, it will create a new entitlement. Except for the kids, these are all people who have worked all their lives. Collectively, they’ve paid millions of dollars in taxes, and they’ve worked thousands of years. Maybe they are entitled to think that if something terrible happens, they can turn to their government for just the little help they need to get out of bed in the morning, to get dressed, and to eat breakfast.

Senator Raggio said, “This committee knows Mrs. Loux as one of the most caring, compassionate, dedicated people in state government. We appreciate you being here.”

Nancy Keller, Registered Nurse Case Manager, Sunrise Hospital and Medical Center, testified from Las Vegas on behalf of herself and her fellow case managers. She spoke in support of the bill. A safe discharge plan for all of her patients is one of the most important aspects of her job, she explained. She added that many patients are senior citizens, or disabled, who live alone but they do not qualify for Medicaid benefits nor do they have sufficient income to pay for a personal care attendant. She said it is important to provide expanded access to personal care attendants “to assure that many of these patients who fall through the cracks, have somebody to get them up in the morning, bathe them, dress them and make sure they have their meals.” She acknowledged the national shortage of nursing professionals compounds the problem for health care providers.

Senator Raggio closed the hearing on S.B. 174 and addressed S.B. 206.

SENATE BILL 206: Requires department of human resources to establish certain programs for respite services. (BDR 38-265)

Cheryl Dinnell, Chairwoman, Nevada Respite Coalition, stated that she was also speaking as a parent of a child with a rare genetic skin disorder, DeBarsy Syndrome. She explained that her organization is a non-funded coalition of respite care providers and families who are interested in developing respite resources in Nevada. The coalition receives in-kind support from some organizations and agencies, she added. She commented that families have a lifelong commitment to be caregivers of a loved one, and there are no resources in this state to relieve them. She cited her own difficulties providing constant care to her son, who is non-verbal, visually impaired, challenged orthopedically, and mental retarded and who has endured many surgeries. She said it is difficult to allow anyone who has not received a two-week training course to care for my son. She asked the committee to consider respite services a priority because families cannot continue to wait and to review the materials she provided (Exhibit J).

Senator Raggio disclosed that he, among others in the room, certainly could relate to the travails of long-term care of a loved one.

David C. Love, Lobbyist, Bethel Renaissance Aging Council, Nevada Respite Coalition, and Grandparents Raising Grandchildren, testified in support of this bill. He stated that it is important Nevada join eleven other states in providing respite care supported by the state. He cited the following reasons for state-supported respite care: caregivers need an occasional break, in-home care is less expensive than institutionalization, and high demand for respite services already exists. He provided a written statement (Exhibit K).

Ginny Oldham testified from Las Vegas as a mother of a five-year old son with autism. She provided written materials (Exhibit L). She stated that she was present for the original bill draft, which included the opportunity for a community-based program to lead the efforts in lieu of the present language indicating the Department of Human Resources. She said she would prefer to see a more community-based program evolve rather than additional “bureaucracy for families to swim through.”

Senator Raggio asked how the programs she referred to are funded. Ms. Oldham responded that the programs are typically self-funded. She added that her organization, Give Me A Break, Inc., is a non-profit organization funded by garage sale proceeds. She stated that on February 10, 2001 she and her organization provided five hours of free respite to twenty-two children in the Las Vegas area for free. Other programs receive funding from the “Tobacco funds, Title IV-B, Crisis Care Nursery such as the rural respite and also Title XX.”

Ms. Oldham explained that she wrote a grant last year through the Children’s Trust Fund that created a statewide toll-free number for respite, which is accessible 24 hours a day, 7 days a week. She asked that the committee include existing respite programs in their consideration of this legislation and to pass a respite bill.

Phillip Manti testified as a single father of twin daughters with cerebral palsy in support of both S.B. 174 and S.B. 206. He explained that his twin daughters are non-verbal, non-ambulatory, incontinent, and have some mental retardation. “Respite is sanity,” he stated. He said he receives approximately 24 hours of respite each month from Eagle Valley Children’s Home. He explained that the three Saturdays each month that he receives respite care are spent completing tasks such as grocery shopping, car maintenance, and haircuts.

Cheryl Dinnell introduced Dorothy Pomin and Judy Walsh.

Judy Walsh, Family Case Manager, Family Support Council, Douglas County, stated that her private, non-profit organization relies on funding from grants, the United Way, and donations. She said she believes the need for respite in this area is tremendous. Her organization facilitates a caregiver support group that has quadrupled its membership in the past six months, and each of the caregivers needs respite. She pointed out that the population explosion throughout Nevada included a significant increase in people over the age of sixty-four, which creates an increased need for respite care to assistance in care of the elderly. She provided a written statement (Exhibit M).

Dorothy S. Pomin, Lobbyist, Sierra Association of Foster Families, testified in support of this bill. She said she believes that the lack of respite care is costly to Nevada and detrimental to foster children. Foster children have often experienced traumatic abuse or neglect that creates a myriad of medical and emotional challenges for their caregivers, she explained. She stated that the most cost‑effective care for these children is family foster care, but there is a 100 percent attrition rate among family foster care providers. Over the past two years the state recruited 249 foster families and 258 left the program, which cost the state approximately $315,000 for recruitment, training, and licensing, she explained.

Senator Raggio asked whether stress and burnout were the reason for the families’ departure from the program. She responded affirmatively.

Ms. Pomin said respite is essential for the families to alleviate stress and avoid burnout. She suggested Title IV-E of the Social Security Act as a possible source of respite funding for family foster care providers. Multiple displacements of foster children often result in propelling the children into the treatment level of required care, and this level of care is extremely expensive for the state, she pointed out. She conveyed that currently one-third of the state’s foster children are at the treatment level, which constitutes 69 percent of the child welfare expenditures. She communicated a desire to stabilize foster families through respite care and reduce costs for the state. She said the current child welfare budget allows for slightly less than $38,000 for respite, which would provide approximately $28 per family per year over the next biennium.

Cheryl Dinnell introduced Bart Archambeau and Christine Hendrix.

Mr. Archambeau testified as a private citizen in support of S.B. 206. He articulated his need for respite care, as he and his wife are the sole providers of care for his eight and a half year old son with cerebral palsy.

Richard and Christine Hendrix spoke as private citizens in support of the bill. Mr. Hendrix explained they have a one-year-old daughter who has cystic fibrosis. He communicated a desire for respite for all caregivers in situations similar to his and his wife’s situation to relieve the stress. He said cystic fibrosis poses special need requirements that the average person would not be aware of; so qualified care is crucial for any respite potentially available to them.

Cheryl Dinnell asked Alicia Smalley to address the committee.

Alicia Smalley, Lobbyist, National Association of Social Workers, spoke in support of S.B. 206. She stated that many caregivers experience burnout before the patient does, and she believes respite care will help them.

Senator Raggio closed the hearing on S.B. 206 and directed attention to S.B. 207.

Assemblywoman Ellen Marie Koivisto provided a written copy of her statement (Exhibit N) regarding S.B. 207. She explained that she was Chairwoman of the Interim Legislative Committee on Health Care, which requested this bill. She said the committee adopted the measure at its June 6, 2000, meeting. However, she pointed out, after much discussion in 1999, the 1999 measure had not been adopted. She stated that Congress enacted the “Ticket to Work and Work Incentives Improvement Act of 1999,” which enables states to expand the availability of health care coverage for working individuals with disabilities. She said many people believe Congress passed this legislation to eradicate the primary obstacle for people with disabilities to return to work, which is the fear of losing their coverage by Medicaid and often Medicare. She summarized the objectives of the new law: to authorize states to determine an upper income limit for the eligibility of some disabled persons; to provide funding for five years while states develop the health care infrastructure for the disabled persons; and to allow states to develop work activity and benefits projects for disabled persons.

Senator Raggio pointed out the bill includes an appropriation of $3 million over the biennium. It also provides for the payment of premiums based on individual need, he added. He said it appears the bill provides for medical assistance, and he asked for further clarification of the provisions of the bill.

Mrs. Koivisto indicated that Paul Gowins and Jon L. Sasser would like to present an amendment to S.B. 207 that would have a fiscal impact.

Senator Raggio opened the hearing on S.B. 259 to accommodate Mrs. Koivisto.

SENATE BILL 259: Requires department of human resources to pay rural hospitals for certain costs incurred by rural hospitals in providing certain services to Medicaid patients. (BDR 38-223)

Mrs. Koivisto stated that S.B. 259 was also requested by the Legislative Committee on Health Care. She explained that 90 percent of all long-term care patients cared for in rural hospital facilities rely entirely on Medicaid for the cost of their care. Medicaid reimbursement compensates the facilities for approximately 70 percent of the costs, which creates a deficit in their operation, she added. She stressed the important role rural hospitals play in the local economies by providing stable employment. She expressed concern that rural hospitals would be forced to close without immediate intervention such as the proposed bill. The closure of rural hospital facilities will force the state to fund treatment in the communities in a less cost-effective manner, she added. She provided a written copy of her statement (Exhibit O).

Senator Raggio re-directed attention to S.B. 207, and he asked Mr. Sasser to provide detailed information on the specifics of the bill and any proposed amendments.

Jon L. Sasser, Lobbyist, Washoe Legal Services Inc., Clark County Legal Services Inc., Nevada Legal Services Inc., and Washoe County Senior Law Project, spoke to the committee regarding S.B. 207. He welcomed Paul Gowins to join him at the table in addressing this bill. Mr. Sasser indicated his handout (Exhibit P) included three pages concerning proposed amendments to this bill. He stated that the intent of the amendments is to make this bill cost-neutral in light of the budgetary constraints. He summarized the objective of the bill is to allow certain persons the ability to return to work without forfeiting their Medicaid benefits, which covers many services private insurance does not. One of the most important services these people would not want to forfeit is the personal care attendant service that is covered by Medicaid, he added. He commented that, for many of these people, the loss of the personal care attendant services would severely impair their ability to get out of bed or to get prepared for work. He said it is a “catch 22” for them. He pointed out that after people begin to receive Supplemental Security Income (SSI) or Social Security Disability Income (SSDI), less than one percent of those people return to the workforce. He added that a 1998 Harris poll found that 70 percent of unemployed people with significant disabilities would prefer to return to the workforce, if possible. He cited the primary barrier to their return to the workforce is the loss of health insurance benefits.

Mr. Sasser indicated that Congress addressed this issue in 1997 and 1999. He pointed out that Congress enacted the “Ticket to Work and Work Incentives Improvement Act of 1999,” which allows states to adopt Medicaid options that would enable Medicaid recipients to return to work and buy into the Medicaid system based on a sliding scale determined by need. He acknowledged the $3 million appropriation over the next biennium in S.B. 207 would probably not bode well for potential approval in view of the budgetary constraints.

Mr. Sasser pointed out that the Governor discussed the importance of this issue in his State of the State Address and announced that Nevada had received a federal grant in the amount of $625,000 for Fiscal Year (FY) 2001 and “$500,000 in the preceding four years to help put together an infrastructure to allow people to go back to work.” The infrastructure is necessary to provide additional training and services for the potential employees and to provide assisted technology to the employers, he added. He said other people only need the medical insurance, not the additional help mentioned. He urged the committee not to wait two years for the completion of a study before allowing any of the people to return to work. He proposed to allow the segment of the population that only require the medical insurance to return to work as soon as possible.

Mr. Sasser clarified that his proposed amendment establishes a process for implementation of the new legislation. He stated that the first six months, July 1, 2001, to January 1, 2002, of that process would allow the Division of Health Care Financing and Policy to determine whether it can develop a cost-neutral version of “ticket to work.” He indicated that he has discussed this issue with Charles Duarte, Medicaid Administrator, Division of Health Care Financing and Policy, Department of Human Resources. Mr. Sasser suggested that Mr. Duarte’s division could present its findings to the Interim Finance Committee (IFC). He stated that if the division was able to present a cost-neutral program to IFC, they could then utilize the next six months for development of the infrastructure, the fee collection mechanism, and satisfaction of any necessary amendments or waivers for the appropriate state agencies. He stated that the program would become effective the second year of the biennium to allow people to go back to work, rather than continuing to wait for the completion of further studies.

Mr. Sasser said he believes cost-neutrality is possible. He explained the cost of people currently at home and dependent on Medicaid would be reduced by their payments of a premium for Medicaid services and by private insurance provided by their potential employers. Based on other state’s experiences, approximately 85 percent of the anticipated program participants would be Medicaid recipients, he added. He explained that, without a waiver, it is necessary to admit a larger group of participants including those with Medicare who receive SSDI benefits. Medicaid would be provided as a supplemental insurance to those participants also, he mentioned. He stated that he would further like to amend his proposed amendments to replace the language “medical assistance” with a term broad enough to clearly include personal care attendant services.

Senator Raggio asked Mr. Duarte to comment on the possibility of developing a cost-neutral alternative for this bill.

Mr. Duarte acknowledged meeting with Mr. Gowins and Mr. Sasser the previous day, March 20, 2001, to discuss this issue. He expressed concern over the likelihood of achieving cost-neutrality, but indicated his willingness to review the proposal further. He stated another concern is that the implementation of a program without the appropriate support for employers may “poison the well for a future program . . . that would be broader in nature than this initial step.” The third concern he cited was program staffing. He explained that any deviation from the current federal grant would require approval that may be somewhat time-consuming.

Senator Raggio asked Mr. Duarte to discuss the approval process and the purpose of the grant. Mr. Duarte stated his division is already six months behind schedule on this program, and he explained the grant is to establish networks with employers and other necessary programs to develop a “ticket to work” program. Mr. Duarte said the division is hoping to propose the new program in the next biennium’s budget.

Senator Rawson stated that he is concerned about jeopardizing the grant by not moving forward with the program. He requested a timeline for the work on the program.

Mr. Duarte responded that he does not have a timeline available at the moment, but he indicated the substantive work must be completed by the beginning of the federal FY 2003. He acknowledged the division is behind in its efforts, as they obtained the grant in October 2000. He said, “[We] are just able to get staffing arranged and really have not started any work on the project.”

Senator Rawson pointed out that if the work is completed by the beginning of the federal FY 2003 that would be after the close of the next legislative session. He stated they would like to be able to review the program during the next legislative session. He asked how much the necessary additional staff would cost.

Mr. Duarte responded that he was unprepared to provide that information, but he anticipated the addition of two full-time positions.

Senator Raggio asked Mr. Duarte to provide a fiscal note pertinent to the additional staff. Mr. Duarte replied affirmatively.

Mr. Sasser said he believes it is a 5-year grant. He stated there are two distinct groups affected by this program, and the first group is “ready, willing and able to go to work today, but for the fact they don’t have medical coverage.” The second group does require more services and subsequently more planning for the program. He said he believes the first group should not be forced to wait two years for the completion of the planning for the second group. He said the general scope of the grant includes assessing Medicaid options, but he may be proposing a slight acceleration of the timeframes. He motioned to Paul Gowins and commented that Mr. Gowins has been approaching the Legislature for the past fifteen years. He stated that, regardless of the action taken on this bill, Mr. Gowins will likely continue his efforts at the Legislature, but they would like to plan beyond the next two years. He reiterated his and Mr. Gowins’ desire to work with Mr. Duarte over the next six months to attempt to prepare something by July 1, 2002.

Senator Rawson commented that the goal should be to have something in progress by the start of the next session, so they don’t forfeit opportunities.

Mr. Sasser responded that he considered the work Senator Rawson did on Medicaid managed care several years ago to be a good model for the program currently under consideration. He stated the work on Medicaid managed care progressed until a critical date in the biennium at which point the committee chose to either abort the project or continue it. He said he would appreciate the opportunity for Nevada to attempt that process with the current project.

Senator Rawson replied, “okay.”

Senator Raggio asked Mr. Duarte to keep the committee apprised of their efforts particularly concerning the first group of people who are ready to return to work.

Mr. Gowins directed attention to the last page of his handout (Exhibit Q) in which he has provided a website address to obtain further information relevant to the topic. He specifically suggested a study completed by Colorado would provide pertinent information to the committee. He stated that he is acquainted with numerous people who are currently completing degrees, and they will be attempting to enter the workforce shortly. He would like to see the barriers to their entry into the workforce removed as soon as possible. He commented that, based on the experience of other states, there are probably fewer than 200 individuals who would participate in the program, of which 85 percent are probably already receiving benefits.

Senator Raggio pointed out that Mr. Sasser’s written statement indicates 138 people would be former Medicaid recipients. Mr. Sasser stated that figure was based on the methodology the Colorado study used.

Senator Raggio further stated that 31 people would be new benefit recipients, according to Mr. Sasser. Mr. Sasser agreed.

Walter LeVasseur testified from Las Vegas in support of S.B. 207. He stated he is currently employed and lost Medicaid coverage when he got married.

Janet L. Gilbert, Lobbyist, Progressive Leadership Alliance of Nevada, spoke in support of the bill with the proposed amendments and encouraged more effective use of the grant funds.

Senator Raggio clarified the bill has not been amended, and he encouraged Mr. Sasser to work with Mr. Duarte to arrive at an accord for any proposed amendments.

Bobbie Gang, Lobbyist, Nevada Women’s Lobby, voiced support for S.B. 207. She said she believes the intent of this bill is “both human and cost-effective.”

Joe Arrascada testified as a private citizen in support of S.B. 207. He explained that he broke his neck diving into shallow water but later managed to finish his high school diploma, a bachelor’s degree, and two master’s degrees before finding employment as a social worker at the Veterans’ Affairs Hospital in Reno. He stated that he does not qualify for Medicaid, but he requires personal care attendant services to get him out of bed and ready for work. He said he believes he is just one of many disabled persons who want to be productive members of society.

Senator Raggio acknowledged his personal acquaintance with Mr. Arrascada who is a very driven, motivated individual.

Senator Raggio closed the hearing on S.B. 207 and directed attention to S.B. 215.

SENATE BILL 215: Makes appropriation to Aging Services Division of Department of Human Resources for support of program to identify services available to Nevada’s seniors. (BDR S-1075)

Senator Rawson stated the idea for this bill was derived from the Kids Count booklet that is published annually. He explained that the booklet provides detailed information on the number of children who are and aren’t insured, the diseases afflicting children, and what areas of their lives need attention. He said the Department of Human Resources has a master strategic plan that has been included in The Executive Budget, and that funding would cover this bill.

Mary Liveratti, Administrator, Aging Services Division, Department of Human Resources, “recommends that the S.B. 215 be incorporated into the Department of Human Resources comprehensive health care strategic plan, which is included in The Executive Budget.” She stated that the division intends to identify services currently available to seniors and additional services necessary to maintain seniors independently while they are developing the strategic plan for senior health care and independent services. She communicated a willingness to compile and publish a report called “Seniors Count,” which would include the information listed in S.B. 215. She provided a written copy of a proposed amendment to the bill (Exhibit R).

Senator Raggio asked whether Ms. Liveratti could accomplish this project within her division’s existing budget. She replied affirmatively, explaining they already gather much of the information.

Senator Raggio asked staff to advise the joint subcommittee working on this matter of the proposed action. He stated that the bill would still need to be processed because of the amendment.

Senator Raggio closed the hearing on S.B. 215 and re-directed attention to S.B. 259.

SENATE BILL 259: Requires department of human resources to pay rural hospitals for certain costs incurred by rural hospitals in providing certain services to Medicaid patients. (BDR 38-223)

Robin Keith, Lobbyist, Nevada Rural Hospital Project Foundation spoke in support of S.B. 259. She stated the current problem is that the state Medicaid program is underfunded and the providers, in this case the rural hospitals providing long-term care, compensate for a portion of the shortfall. She explained that this practice essentially transfers the state’s budgetary problems to the rural hospital facilities. She acknowledged, “Until the voting public supports a different revenue base in this state, the solutions to problems like this one are difficult.” She stated that the rural hospitals provide slightly less than 6 percent of the Medicaid long-term care patient days and they represent slightly less than 10 percent of Medicaid’s budget for long-term care services.

Ms. Keith pointed out that in 1995, Medicaid agreed to the principle of cost-based reimbursement for hospital-based, long-term care, recognizing that care in this environment is necessarily more costly to provide than it is in freestanding facilities. It is more costly because hospitals must recruit physicians and provide emergency room services, laboratories, x-rays and various other services that freestanding facilities do not have to provide, she explained. She said the Medicaid program recognized, at that time, the overall importance of rural hospitals and supported cost-based reimbursement for long-term care as a means of ensuring the viability of them. She explained the state Medicaid plan provides for cost-based reimbursement for long-term care but caps reimbursement by imposing a ceiling, referred to as the routine service cost limit. This number was previously a part of the Medicare reimbursement methodology, but it is no longer relevant because Medicare now uses a prospective payment methodology, she added.

Ms. Keith stated that Mr. Duarte received numerous letters from D. Pamela Deam, C.P.A., Manager, Medicaid Audit Division, Blue Cross Blue Shield of Nevada, dating back to at least December 1999, which notified him that “Medicare is no longer calculating or updating the routine service cost limitation.” Ms. Keith testified that Ms. Deam’s letters repeatedly urged Mr. Duarte to amend the state’s Medicaid plan, and Ms. Deam also wrote that the state’s Medicaid program saved $579,000 in 1998 by imposing this cap that had not been updated on hospital-based long-term care services. She clarified that this issue has persisted for a number of years, and another $500,000 burden is transferred from Medicaid to the rural hospital facilities and local taxpayers each year. This bill would remove the obsolete ceiling imposed on reimbursements, she added.

Ms. Keith addressed potential concern that the removal of the ceiling would allow unrestrained increases in costs. She stated that most of the hospitals affected are public hospitals governed by elected boards that are accountable to their local communities. She added that the facilities are very conscientious about their affect on their counties, and counties typically participate in the cost of long-term care. Another means of accountability is that county commissions are generally represented on hospital boards.

Ms. Keith stated that the Nevada Association of Counties (NACO) does not relish increased costs at the county level but supports the concept of S.B. 259. She explained that Mr. Robert S. Hadfield, Lobbyist, NACO, asked her to convey his support in his absence.

Ms. Keith referred to her handout (Exhibit S), to demonstrate the effect of the imposed ceiling. She explained that Medicare’s upper payment limit for long-term care at Mount Grant General Hospital in Hawthorne for one day is $201.82. She said $161.62 is what Medicare deems the actual allowable cost for one day of long-term care at the hospital in Hawthorne. She stated that Medicaid actually pays $142.24 per day for the same long-term care because of the routine service cost limit.

Senator Raggio asked who would determine what reasonable costs are for each hospital under the proposed bill. He further questioned whether the costs would vary from county to county.

Ms. Keith affirmed that the costs would vary among counties, but the principles of reasonable costs are defined in Medicare regulations, which is the foundation for Medicaid principles.

Senator Raggio asked whether reasonable costs are easily discernible. Ms. Keith responded affirmatively.

Senator Raggio disclosed his law firm represents Mount Grant General Hospital.

Senator Rawson stated that the chart provided by Ms. Keith is simplified because the issue is considerably more complicated. He said the hospital in Caliente is paid $140.74 per day for long-term care by Medicaid which is very close to its actual costs, but that hospital offers very limited services. For example, he mentioned the Caliente hospital does not have the financial resources to even buy ultrasound equipment, and they will never be able to obtain it by merely recovering actual costs expended. He said he believes the decisions of lawsuits on this issue have always been that hospitals should be reimbursed at least the full cost of the care provided.

Ms. Keith referred the committee to the second page of her handout (Exhibit S), which is a comparison of the rural hospital’s actual nursing home costs and the reimbursement allowed by Medicaid. She explained that the cost of services for Battle Mountain, Boulder City, and Humboldt hospitals are moderately higher as they have invested substantially in upgrading their facilities, specifically for long-term care.

Senator Raggio asked whether her chart indicates that the seven rural hospitals combined to subsidize Medicaid in the total amount of $529,740 during 1999. She responded affirmatively.

Ms. Keith explained that the final row on the second page indicates which of the seven facilities are eligible for the Critical Access Program. The federal government now acknowledges the financial crisis created in rural hospitals when Medicare payments fail to reimburse hospitals’ actual cost of providing the services. The Healthcare Financing Administration created the Critical Access Program so that Medicare would reimburse designated hospitals at their actual costs. Boulder City is the only one of the seven facilities that does not qualify for this program because it is considered urban. Nevada Rural Hospital Project is actively pursuing this designation for its facilities, and three have already been designated, she added. She stated that the Critical Access Program not only eliminates the disproportionate cost allocation but “it also helps eliminate the need to shift costs out of inpatient and outpatient portions of a hospital’s operation into long-term care.” This will help ensure that costs do not skyrocket as a result of S.B. 259.

Senator Rawson stated, “The issue is we could lose long-term care beds in some of these hospitals if they’re not funded appropriately.” He said he believes Mr. Duarte is cognizant of the problem and currently working on a new fee structure. He said this bill is an attempt to ensure a new fee structure is implemented, and it is possible a new fee structure will be implemented before the close of session. He indicated his support for this bill.

Senator Raggio asked Mr. Duarte whether this matter is still under consideration. Mr. Duarte responded that his division has contracted with a firm to work with the hospital association, the healthcare association, and the Nevada Rural Hospital Project on facility-based rates for inpatient care and long-term care. He said the contractor is currently working with the groups to receive input on developing a new methodology, which would include reimbursement rates for rural facilities.

Senator Raggio asked when Mr. Duarte anticipates specific information to be available. Mr. Duarte responded that he anticipates the information in mid‑April 2001.

Ms. Keith referred the committee to the third page of her handout (Exhibit S) for a breakdown of the $700,000 yearly appropriation included in this bill. She summarized that her organization is working diligently with Mr. Duarte’s division, but she is concerned the necessary information will not be agreed on and prepared by mid-April.

Senator Raggio explained that this bill is exempt and action on all exempt bills is pending decisions on The Executive Budget.

Senator Raggio recessed the meeting at 10:24 a.m.

Senator Raggio reconvened the meeting at 10:29 a.m.

BUDGET OVERVIEWS

LEGISLATIVE COUNSEL BUREAU

Legislative Counsel Bureau – Budget Page LCB-1 (Volume 1)

Budget Account 327-2631

Legislative Commission

Lorne J. Malkiewich, Director, Legislative Counsel Bureau, referred committee members to his Reconciliation with Executive Budget Document handout (Exhibit T.) He stated that the reconciliation provides considerably more detail than the information included in The Executive Budget, which omitted a great deal of the LCB budget. He explained the following numbers from The Executive Budget are shaded in his handout, the $18,604,725 in FY 2002 and $18,169,658 in FY 2003 and a “one-shot” appropriation of $861,585. He said the appropriation represents the funding for all of the E-710, E-720, and E-730 decision units. They were pulled out of the appropriation to the LCB in the two fiscal years and made into a “one-shot” appropriation for the current fiscal year. He explained the cost of living adjustment (COLA), which is $2,613,077 over the biennium, must be added to arrive at the final figures.

Senator Raggio stated that the Budget Division acknowledged that COLA, amongst many other items, had inadvertently been omitted from this budget.

Mr. Malkiewich said the Occupational Studies decision unit M-303 (Exhibit T) was also inadvertently omitted. He added that M-303 amounts to only $344,397 out of a $4.7 million increase in our budget, but he believes the committee is always interested in the position upgrades for the LCB, regardless of its size. To this end, he said he directed all the division chiefs to provide a detailed explanation of all proposed upgrades.

E-475 Effectiveness of Family Service – Page LCB-2

Mr. Malkiewich recommends the removal of the E-475 decision unit, which is for a juvenile justice standing committee, because there is a bill pending that addresses that issue. He indicated the bill could contain its own funding if it is passed, thereby eliminating the need for this decision unit.

E-903 Transfer from B/A 2673 Dues - Page LCB-2

Mr. Malkiewich further explained E-903, fees for the Education Commission of the States, was transferred from the Education State Programs budget, 101-2673, into the LCB budget. He stated that he does not object to that transfer as long as the LCB’s responsibility does not extend beyond payment of the fee.

Mr. Malkiewich summarized the LCB budget is increased by approximately $4.7 million, of which about $2.6 million is for COLA; therefore, the budget, excluding COLA, constitutes an increase of approximately 5 percent.

Mr. Malkiewich addressed the Legislative Commission portion of the budget, which begins on page nine of his handout (Exhibit T). He pointed out the cost breakdown of dues and meeting registrations on page 10.

Senator Raggio stated he is concerned about the expense of the dues for the national organizations. He asked whether all states participate in National Conference of State Legislatures (NCSL) and Council of State Governments (CSG). Mr. Malkiewich said he believes all states do participate, but there were times in the past when some states were unable to participate due to economic difficulties within their individual states. He said virtually all states now participate, and the fees are based on the population of the individual state.

Senator Raggio said he is concerned because there is no accountability to the states by these organizations. He expressed a desire to review how those dues are utilized by the organizations. He stated that the Legislature is accountable to the public for how their funds are spent, and the expense of the dues does not include the cost of attending their meetings.

Mr. Malkiewich responded he would provide detailed information on these dues. He pointed out that the CSG dues include Council of State Governments West, of which Assemblyman Hettrick is the incoming President. He stated that Mr. Hettrick has worked diligently to maintain dues at a reasonable level by finding ways to get some of the states currently not paying dues to begin paying. He recommended that legislators who participate in the conferences of these organizations should voice their concern directly to those organizations.

Senator Raggio stated that it is difficult to accept the high cost of these dues in light of their current budgetary constraints that are affecting so many of the state’s agencies.

Mr. Malkiewich stated that the Legislative Committee on Education has been included in the LCB budget for the past few sessions, and it has decreased slightly. He reiterated his proposed deletion of $35,000 for the Legislative Committee on Juvenile Justice because of the proposed bill. He referred to decision unit E‑475 Effectiveness of Family Service included in his handout (Exhibit T).

Senator Raggio asked what the $35,000 figure had included. Mr. Malkiewich responded it is to cover the cost of meetings for the 8-member committee and for expert contract service fees.

Mr. Malkiewich noted there are no significant increases in the budget of the Legislative Commission.

Administrative Division

Mr. Malkiewich directed attention to the Administrative Division of the LCB (Exhibit T). He stated that every legislator who responded to an LCB survey gave the Legislative Police the highest grade allowable. He provided the results of the survey and other performance indicators for the Administrative Division (Exhibit U). He indicated they are requesting additional positions in the area of information systems because it is the only area that shows a substantial increase according to volume indicators. The Administrative Division budget increases by $1.6 million over the biennium, of which $1.3 million is attributed to COLA and additional positions primarily in information systems, he added.

Senator Raggio questioned the need for four new positions in information systems. Mr. Malkiewich responded the LCB is performing more programming in-house, which would be offset by a reduction of private contractor fees. He added they manage their own website that is steadily increasing in volume of traffic. He further discussed decision unit M-200 Demographics/Caseload Changes of his handout (Exhibit T). He explained that LCB would like to add 1 Programmer, 1 Internet Specialist, and 2 Helpdesk Specialists. He clarified one of the helpdesk specialists will be located in Las Vegas part time. He added that the LCB would like to make the current part-time secretary position in Las Vegas a full-time position because of the increased demand for videoconferencing. The final position requested is for media services, he stated.

Mr. Malkiewich stated he would provide detailed justification on the six upgrades requested for Occupational Studies within the Administrative Division. He referred to M-303 Occupational Studies within his handout (Exhibit T). He explained most of the upgrades are for information systems positions.

Senator Raggio asked whether all positions proposed for upgrades have gone through the occupational studies process. Mr. Malkiewich replied affirmatively.

Senator Raggio questioned the need for a new parking garage sweeper. Mr. Malkiewich responded the LCB does not own a sweeper, and he will provide further information to the committee explaining the request. He referred the committee to E-720 New Equipment on page 16 of his handout (Exhibit T).

Senator O’Donnell asked whether the Legislative Police who are sent to the airport to pick up legislators could carry cellular phones, so the legislators can reach them. Mr. Malkiewich agreed to comply with the request, and he will make the cellular phone numbers available to all legislators.

Senator Raggio asked whether there were any requested additions for the Legislative Police. Mr. Malkiewich responded there were none.

Audit Division

Wm. Gary Crews, CPA, Legislative Auditor, Audit Division, Legislative Counsel Bureau, stated that, excluding the step 9 and COLA increases, the Audit Division is requesting a 5.9% increase from the previous budget. He discussed decision units attributing to the budget increase, which are outlined, on pages 19 and 20 of the handout provided by Mr. Malkiewich (Exhibit T). He explained that decision unit M‑200, Demographics/Caseload Changes, includes requests for an upgrade of a secretarial position to an Information Technology Auditor position and the addition of 1 new Information Technology Auditor position in FY 2003. The division would have 3 Information Technology Auditors with the 2 positions currently requested.

Mr. Crews explained the growing need in the area of information technology to ensure the security of numerous state agencies information systems. He pointed out the following agencies maintain very sensitive information within their information systems: Department of Motor Vehicles and Public Safety, Department of Personnel, Office of the State Controller, and Department of Human Resources. He stated that the current trend is toward decentralization into the separate agencies, which allows more effective use of the information systems by the agencies and greater vulnerability of their security. The Internet poses increased opportunities for breaches of security, he added. He said the division is requesting an additional $50,000 in FY 2002 to contract an outside professional to assist in the initial assessment of the various agencies’ information systems. He explained the contracted professional will work side by side with audit division staff to enable them to continue the process without future expense for outside services.

Mr. Crews addressed decision unit E-710, Replacement Equipment, on page 20 of the handout (Exhibit T). Senator Raggio asked what would happen to the old equipment upon its replacement. Mr. Crews responded that he believes the equipment is returned to the Purchasing Division, Department of Administration.

Mr. Crews provided the committee current performance indicators for his division (Exhibit V).

Senator Raggio directed attention to the Nevada Legislature Interim budget to accommodate Claire Jesse Clift, Secretary of the Senate, Legislative Staff, Nevada Legislature and Jacqueline Sneddon, Chief Clerk of the Assembly, Legislative Staff, Nevada Legislature.

Nevada Legislature Interim – Budget Page LCB-4 (Volume 1)

Budget Account 327-2626

Ms. Clift provided a “reconciliation with the governor’s executive budget” (Exhibit W), which includes the Step 9 increase, the COLA, and staff upgrades, which were inadvertently omitted from The Executive Budget as explained by Mr. Malkiewich earlier. She provided a written statement, (Exhibit X).

Senator Raggio questioned how many positions are included in this budget. Ms. Clift responded three positions for each house are included in this budget for a total of six positions.

She explained this budget increased by slightly less than 5 percent excluding the COLA and step 9 increases. She indicated the budget includes out-of-state travel funds for the Secretary of the Senate and the Chief Clerk of the Assembly to attend the annual NCSL and other professional organizational meetings. The dues for those organizations are included in the operating expenses in addition to funds for staff training, she added.

She referred to M-200, Demographics/Caseload Changes, on page 3 of her handout (Exhibit W). She explained the personnel line item includes intermittent pay for the Assistant Secretary of the Senate, Assistant Chief Clerk of the Assembly and Sergeant at Arms while they are attending the annual training seminars. The out-of-state travel line item provides for the additional cost for the two technical assistants to attend the annual American Society of Legislative Clerks and Secretaries (ASLCS) seminar, she added.

Ms. Clift referred to M-303, Occupational Studies, on page 4 of her handout, (Exhibit W), which includes an upgrade for the Executive Assistants and Technical Assistants. She stated that the upgrade will bring these positions in line with like positions within other divisions of the LCB.

Senator Raggio asked whether Ms. Clift would like to address the proposal to compensate session staff and the related enhancements proposed. Ms. Clift responded she would prefer to address that another time.

Legislative Counsel Bureau – Budget Page LCB-1 (Volume 1)

Budget Account 327-2631

Fiscal Analysis Division

Gary L. Ghiggeri, Senate Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, explained their budget proposes an increase of .6 percent excluding the COLA and step 9 increases. He pointed out that M-200, Demographic/Caseload Changes, on page 23 of Exhibit T includes additional contract funding for the Bureau of Educational Accountability unit within the division.

Senator Raggio asked whom they contracted with. Mr. Ghiggeri replied there are currently four different contracts. The first is with Dr. George C. Hill who provides the outside review of school accountability programs, for which he received $25,700 compensation last fiscal year. He stated that the division is currently proposing compensation for Dr. Hill’s services in the amounts of $30,000 in FY 2002 and $35,000 in FY 2003.

Senator Raggio questioned where that funding could be found in the budget. Mr. Ghiggeri responded it is found in the M-200 decision unit. He explained that the base budget is reduced from the request; the total funding need for the education portion is $45,000, of which $25,000 is included in the base budget.

Senator Raggio asked where the rest of the funding could be found in the budget. Mr. Ghiggeri responded approximately $19,000 of the $24,000 a year increase requested in the M-200 decision unit constitutes the rest of the funding. Approximately $3,000 of the $24,000 is requested for training, he added. He stated that the $24,000 request includes $1,600 in the first year and $2,700 in the second year for contracts the fiscal division has with Wharton Econometric Forecasting Associates (WEFA) and The Foundation Financial Information System (FFIS) to assist in tracking federal funds and to assist with the Economic Forum.

Mr. Ghiggeri explained M-303, Occupational Studies, on page 24 of Exhibit T includes the request for five reclassifications. The five reclassifications include 3 Senior Fiscal Analysts from grade 43 to grade 44 and 2 Management Assistants from grade 27 to grade 29.

Senator Raggio asked whether the reclassification included the team leaders. Mr. Ghiggeri responded the 3 Senior Fiscal Analysts are the team leaders.

Senator Raggio noted the Fiscal Analysis Division had experienced significant turnover recently. Mr. Ghiggeri responded the division lost seven analysts since the last biennium.

Senator Raggio asked whether the analysts had left for higher salaries and where they went. Mr. Ghiggeri agreed the analysts left for higher salaries. He said two analysts left for employment at the University and Community College System of Nevada, one to the Washoe County School District, one to the Department of Taxation, one to the Department of Employment, Training, and Rehabilitation, one to Department of Human Resources, and another retired.

Senator Raggio asked whether these upgrades would make the Fiscal Division’s salaries competitive. Mr. Ghiggeri responded the upgrades would align the salaries of the senior team leaders with the current AS0-IV (Administrative Services Officer IV) salary level in the Executive Branch.

Mr. Ghiggeri articulated E-710, Replacement Equipment, on page 24 of Exhibit T provides funding to replace computer equipment. He referred to E-720, New Equipment, on page 25 of Exhibit T requests $3,000 over the biennium to purchase file cabinets and other small office equipment. He indicated $7,360 is requested in E-845, Other Enhancements, found on page 25 of Exhibit T to allow new staff to attend professional development training seminars. He provided the committee performance indicators for the division (Exhibit Y).

Legal Division

Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau, presented the budget for her division.

Senator Raggio inquired regarding the status of bill drafts. Ms. Erdoes replied the division is behind, and they are still receiving details for many of the committee bills. She said they would be working through the weekend to ensure the legislators receive the drafts prior to their deadline, but that means the committees will receive a large number of bill drafts on Monday.

Senator Raggio questioned whether Monday, March 26, 2001, is the deadline for committee introductions of bills. Ms. Erdoes responded affirmatively.

Senator Raggio indicated many committees would need to hold floor meetings to accommodate the legal division and satisfy the deadline requirement. He asked Ms. Erdoes to please notify him if her division needs a date extension to complete their work without utterly exhausting her staff.

Ms. Erdoes indicated the budget for her division was slightly less than last biennium excluding the COLA and step 9 increases. She stated the reduction in the budget occurred mostly in operations. She pointed out there are fourteen position reclassifications included in M-303, Occupational Studies, found on page 28 of Exhibit T. She explained eight of the upgrades are located within their technical services unit. The technical services unit employs thirteen people who are responsible for the integration of all adopted amendments into the enrolled bills prior to sending the camera-ready copy to the printing office, she added. She cited high turnover in the unit because of low salaries; the unit had eight new people this session. She said the unit trains new people on their computers and subsequently loses those people to other state agencies who offer higher salaries.

Senator Raggio questioned whether the proposed reclassifications will be sufficient to stem the turnover. Ms. Erdoes said these upgrades would improve the competitiveness of the positions, but not eradicate turnover at the proposed salary level.

Senator Raggio directed Ms. Erdoes to submit a competitive upgrade proposal to the committee that would discourage continued turnover. She agreed to comply with his request. He further suggested the other divisions should submit proposals with the intent to retain their staff.

Senator Raggio asked whether the occupational study process had approved the upgrades. Ms. Erdoes replied affirmatively.

Ms. Erdoes referred to the performance indicators for her division (Exhibit Z). She stated that the number of bills has decreased in recent sessions, but the number of pages of statutes has increased significantly. She indicated the interim workload consists largely of opinions and administrative regulations, which are difficult to predict. Lengthy regulations are increasing in the administrative area also, she added.

Senator Raggio asked whether the number of requests for legal opinions has increased. Ms. Erdoes responded affirmatively. She said she anticipates further increases in the number of legal opinions.

Senator Raggio stated her division had been involved in litigation this past interim representing the Legislature. She responded her division had been involved in more litigation this past interim than in previous interims.

Senator Raggio asked whether there is litigation still pending. She replied affirmatively, “the test case for the Hancock case.” Senator Raggio asked the status of that case. Ms. Erdoes stated there would be oral arguments on April 3, 2001. She added the briefing is completed and the court granted her motion for expedited review, which means a decision should be rendered shortly after the oral arguments. Senator Raggio complimented her division staff on their efforts on this case and on their intervention in the tax initiative.

Ms. Erdoes pointed out the results of the legislators’ surveys are compiled in the performance indicators (Exhibit Z). She said she is pleased her division has improved its performance, and she assured the committee the division would remain cognizant of these numbers. Senator Raggio commended her on a job well done.

Senator Neal asked whether any funds were included in the budget for ergonomics. She responded they are concerned with that topic because of a significant number of illnesses and stress-related injuries to both the neck and wrists. She said they have not requested additional funds to address that issue, but they have worked with other state agencies’ existing resources.

Research Division

Robert E. Erickson, Research Director, Research Division, Legislative Counsel Bureau, provided an Expanded Program Narrative of Research Division’s Budget Request for FY 2002 and FY 2003 (Exhibit AA). He pointed out their budget proposes an increase of 7 percent excluding the COLA and step 9 increases, which he attributed to the proposed addition of 3 new Analysts and 8 position reclassification upgrades. He articulated the division had received ratings of 3.81 or higher in the basic categories of the legislator survey (Exhibit AA). He said he believes the following two areas can be improved: consistent quality in products produced and timeliness of responses. The additional staff requested would help meet those improvement goals, he added.

Mr. Erickson cited a tremendous increase in the number of requests received by his division during the current biennium compared to the past biennium. He added that the constituent services staff receives many of those requests, which have been referred to them by legislators on behalf of their constituents. He noted increased staffing needs pursuant to an expansion of interim studies and subsequent task forces, subcommittees, and technical advisory committees.

Senator Raggio questioned how many staff members the division currently has. Mr. Erickson responded his staff is currently composed of twenty-six full-time employees and three part-time employees.

Mr. Erickson directed attention to M-200, Demographics/Caseload Changes, on page 32 of Exhibit T, which provides for the addition of 2 Senior Research Analysts in FY 2002 and 1 additional Senior Research Analyst in FY 2003. He indicated one of the Senior Research Analysts proposed for FY 2002 would be assigned to work primarily in the constituent services area, and the second Senior Research Analyst would be assigned to work primarily in health and human services and to assist with health and human services requests directed to constituent services. He stated there has been an increase of over 30 percent in the volume of legislator requests over the past two years. The third new Senior Research Analyst to be added in FY 2003 would work in the areas of research projects for legislators and informational requests for constituents.

Senator Raggio asked whether the division had experienced high turnover. Mr. Erickson responded that turnover was a significant issue two to three years ago, but the division has only lost one analyst in the current biennium. To this end, he addressed M-303, Occupational Studies, on page 33 of Exhibit T, which provides for the upgrade of eight positions. He said, “We hope that this will build a little better career ladder, a little better structure.”

Mr. Erickson pointed out he had recently reorganized the division to create subject area teams with team leaders who have supervisory responsibilities. He is requesting an upgrade for those four team leaders from a grade 43 to a grade 44. He stated he is proposing an upgrade for the 2 Chief Principal Research Analysts from a grade 45 to a grade 46. He explained the 2 Chief Principal Research Analysts perform additional duties in constituent services and the legislative library. He said two other staff members were recently assigned the additional responsibility of training. He indicated all of these recent and proposed changes have been through the occupational studies process.

Senator Coffin complimented the Research Division on the creation of the constituent services unit because it has provided immediate relief to the legislators seeking to provide this information. He stated that he has received a great deal of positive feedback from constituents who have benefited from this service. He said, “This is one of the few increases in staff where you can really see a justifiable result in the end.”

Senator Neal asked Mr. Malkiewich, “What are you doing to get more minorities working here?” Mr. Malkiewich stated that the LCB recognizes the lack of diversity in its staff, and said LCB advertises in minority publications, in addition to the general advertisements, whenever it recruits for open positions. He pointed out that this geographic area “does not have a very large pool of minority applicants to draw from.” He said it is difficult to recruit minorities in this area, but the LCB is cognizant of the problem. He assured Senator Neal the LCB is actively trying to diversify its workforce with some success, and they will continue those efforts.

Senator Raggio reminded Mr. Malkiewich that he and his division directors should provide recommendations for increases to their unclassified salaries. Mr. Malkiewich agreed to comply with the request.

Senator Jacobsen asked whether office space and facilities were sufficient for the LCB. Mr. Malkiewich responded, “We’re tight. We’ll get tighter. If we get the Capitol Apartments, we do have at least a little bit of a safety valve.” He added they would move some staff but mostly storage to the Capitol Apartments upon potential possession.

Senator Raggio closed the hearing on the LCB budget, and he asked that all handouts provided be included in the record.

Senator O’Donnell said Elgin Simpson has contacted him repeatedly regarding the status of the Task Force on Bias in the Courts. He said Mr. Simpson told him that he was the Chairman of the Task Force prior to its being eliminated from The Executive Budget. Senator O’Donnell said Mr. Simpson asked him to advise Mr. Simpson on the proper course of action to continue funding the task force; therefore, Senator O’Donnell asked the committee how to advise him.

Senator Raggio said the deadline for bill draft requests is quickly approaching. He said he believes the task force was part of the courts’ budget, and it appears they deleted it.

The meeting was adjourned at 11:17 a.m.

RESPECTFULLY SUBMITTED:

Jennifer Ruedy

Committee Secretary

APPROVED BY:

Senator William J. Raggio, Chairman

DATE: