MINUTES OF THE
SENATE Committee on Finance
Seventy-First Session
April 2, 2001
The Senate Committee on Financewas called to order by Chairman William J. Raggio at 8:05 a.m., on Monday, April 2, 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
Senator Bernice Mathews
STAFF MEMBERS PRESENT:
Gary L. Ghiggeri, Senate Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Mark Krmpotic, Program Analyst
Jim Rodriguez, Program Analyst
ElizaBeth Root, Committee Secretary
OTHERS PRESENT:
Richard P. Clark, Executive Director, Peace Officers’ Standards and Training Commission
Michael Jensen, Deputy Attorney General, Transportation and Public Safety Division, Office of the Attorney General
John P. Comeaux, Director, Department of Administration
P. Michael Murphy, Chairman, Peace Officers’ Standards and Training Commission
Jackie Crawford, Director, Department of Prisons
David Meligan, Warden, Northern Nevada Correctional Center, Department of Prisons
Wayne Carlson, Lobbyist, Nevada Public Agency Insurance Pool & Public Agency Compensation Trust
Janet Johnson, Assistant Director, Support Services, Department of Prisons
Thomas A. Glab, P.E., Chief of Plant Operations, Department of Prisons
Robin Bates, Warden, Warm Springs Correctional Center, Department of Prisons
Good morning, committee. We have a report from committee staff on the status of the matters of this committee.
Gary L. Ghiggeri, Senate Fiscal Analyst:
I distributed to the committee a handout entitled, “Progress Report as of April 2, 2001.” (Exhibit C.) The committee, subcommittee or staff has reviewed 415 out of 419 budgets. As of today, there are four budgets still to be reviewed by subcommittee this week. Once those budgets are reviewed this week The Executive Budget will have been completely reviewed. The committee has closed 25 budgets in full committee and 4 budgets have been closed in subcommittee. The impact of those closures is a savings of General Fund dollars of $454 in fiscal year (FY) 2002 and a cost of $12,023 in FY 2003. There are currently 160 bills in committee; 158 of those bills are “Senate Finance bills.” Two of those bills are Assembly bills. The committee has heard 56 bills, and deferred two. There are 18 bills scheduled this week; two bills have been indefinitely postponed; and three bills have been processed.
The three bills have been processed and one of the bills that have been indefinitely postponed has resulted in savings this fiscal year of $209,824. Two of these bills included supplemental appropriations, and the third was Senate Bill (S.B.) 199. Senate Bill 199 was for the purchase of the Capitol Apartments.
SENATE BILL 199: Makes appropriations for purchase and light renovation by Legislative Counsel Bureau of Capitol Apartments as described in land description verified pursuant to Nevada Revised Statutes (NRS) 218.255. (BDR S-733)
Chairman Raggio:
Committee, as you can see from this report, this committee has 160 bills currently in committee, only two of which are Assembly bills. The revenue projections are highly likely to be less than that projected by the Economic Forum in December 2000. I am going to ask each member of this committee and, by memorandum, all the senators to review the list of requested bills and advise the Chairman of any bills that can be withdrawn. Our time is valuable. We are trying to schedule hearing for bills. Any that need not be heard or can be withdrawn, I ask you to please let me know.
I will do the same by memorandum to the other senators. I do not want to be radical about it, but I think you all understand. Each of you needs to look at the bills and see whether there are some you believe can be withdrawn, so that we do not “go through motion” to hear bills we know cannot and will not be processed.
Senator Rawson:
Could we request committee staff do a list of bills with their title and description displayed?
Chairman Raggio:
I have a list and I will ask committee staff to make this available to all members of the committee. It shows all the bills, their descriptions, and who requested the bills. If committee staff can make this available to the members today that would be greatly appreciated.
Senator Coffin:
Could we also have the same list for Assembly bills and identify which bills are exempt?
Chairman Raggio:
Are you talking about bills referred to the Assembly Committee on Ways and Means?
Senator Coffin:
Yes, the Assembly bills as well as a list of the Senate bills.
Chairman Raggio:
If they have it, committee staff will request that be made available.
SENATE BILL 144: Revises provision relating to payment of certain transitional expenses for governor-elect. (BDR 18-391)
Chairman Raggio:
Let us now look at S.B.144. This bill was heard in this committee on March 21, 2001. It appears this bill is not objectionable and I will entertain the committee’s decision.
SENATOR RAWSON MOVED TO DO PASS S.B.144.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR NEAL VOTED NO.)
* * * * *
Chairman Raggio:
This morning we have a number of bills for hearing. Anyone here who needs to be taken out of order?
SENATE BILL 445: Makes appropriation to Peace Officers’ Standards and Training Commission for analysis of job tasks and study of physical fitness validation for peace officers. (BDR S-1383)
Richard P. Clark, Executive Director, Peace Officers’ Standards and Training Commission:
There are a number of individuals here to testify on S.B.445.
Chairman Raggio:
Without any objection, we will hear S.B. 445. Committee, you have backup information on all the bills on today’s agenda (Exhibit D. Original is on file at the Research Library.).
Mr. Clark:
We are here today to testify in support of S.B.445 (Exhibit E.). Many distinguished members of the law enforcement community are present in the audience. There are two parts to this bill. The second part was not communicated in time to committee staff, and so it does not appear on the initial bill.
Chairman Raggio:
The bill before us appropriates $200,000 to the Peace Officers’ Standards and Training Commission (P.O.S.T.) for an analysis of job tasks and a study of the physical fitness validation for peace officers.
Mr. Clark:
Yes, Mr. Chairman. I have some amendments that were provided. There is no change in the request for funding, only for the purpose of that funding. The first request is for funding for law enforcement job task analysis and a physical fitness validation study to develop appropriate and legally defensible physical fitness standards for Nevada law enforcement police officers in categories 1, 2 and 3 for selection, hiring, and certification. Currently, we have a standard in place that is only supported by scientific study completed in Idaho.
The second part of the request is for advanced training for supervisors and middle managers to address issues of ethical behavior, leadership, accountability, inspection, and control that will assist the law enforcement community in the prevention of incidents of corruption and that will increase professionalism and prevent issues of liability. We have provided two proposed amendments to the bill in our handout (Exhibit E). That would be a total of $200,000 for both requests, with any balance remaining reverting to the General Fund. If the committee is more comfortable with a closer defining, we propose $150,000 for the analysis, and $50,000 for the additional training.
Chairman Raggio:
Tell us about the analysis of job tasks and physical fitness. Tell us what that covers and why it is necessary.
Mr. Clark:
Yes, Mr. Chairman. The job task analysis and physical fitness validation study is necessary to set legally-defensible standards for physical fitness for individuals who are applying for, hired, and certified to be peace officers in this state. The exact level of physical fitness requirements to be a peace officer in this state cannot be arbitrarily set because it sets our department up for liability issues. Currently, the standard or “cut points” are set based on a scientific study that was not completed in Nevada.
Chairman Raggio:
Did you say that a study was completed in Idaho?
Mr. Clark:
Yes, Mr. Chairman. The state has not conducted a study of its own to verify or justify the exact “cut points.”
Chairman Raggio:
Who did the study for Idaho?
Mr. Clark:
The study was completed by an organization called Fit Force, who then came out with their guide entitled “Fit Force Administrator Guide.” We adopted this study because it was the closest thing we could find to be able to defend and set “cut points” that would be defensible to some degree.
Chairman Raggio:
What kind of standards do they set?
Mr. Clark:
Specifically what they set are physical fitness “cut points” for the physical conditioning level that a person would need to perform the job of a peace officer. That would be how fast they could run 1-1/2 miles, how high they could jump, or how many sit-ups and push-ups they can do. In other words, the exact physical level scientifically proven that they would need to do the job as a peace office in Nevada.
Chairman Raggio:
Are these for entry standards or for maintenance?
Mr. Clark:
These are for entry standards, but they would also look at them for maintenance standards, as well. What complicates the issue slightly is in Nevada we have three different categories of peace officers. Category 1 is for unrestricted peace officers that do the full range of duties. Category 2 is for peace officers that have a limited or restricted level of responsibilities. An example of category 2 would be a court bailiff or an investigator for the Office of the Attorney General. Category 3 is for confinement and correctional officers. So, there are three different categories, which means there are legitimately three different levels or approaches to what physically they need to be able to accomplish to perform their jobs. These are things we would need to establish and be able to defend in a court of law.
Chairman Raggio:
Did Idaho have similar levels of corrections and officers?
Mr. Clark:
Idaho had category 1 officers. They had some restricted officers, such as wildlife investigators. I do not believe their study included correctional officers. However, the Department of Prisons did a parallel study to look at the job task analysis Idaho had used and they said they would be comfortable that the study was close enough they would accept the definitions, at least temporarily. The commission had decided it was important to go forward with this, instead of being tied to a study completed outside of Nevada. That would allow then to set legally‑defensible standards within the state. The deputy from the Office of the Attorney General who advised P.O.S.T. is here with me today.
Chairman Raggio:
Would you comment on that issue?
Michael Jensen, Deputy Attorney General, Transportation and Public Safety Division, Office of the Attorney General:
Mr. Clark asked me here today to discuss with you why it is legally important for us in Nevada to have our own validation study and job task analysis completed. I believe one needs to start with the self-evident proposition that good, useful and meaningful physical fitness standards are going to disqualify certain applicants from certification and careers in law enforcement. If it does not disqualify some people, it is not a meaningful standard. Inevitably, if it disqualifies certain people from careers in law enforcement, it is going to disqualify certain people with disabilities as defined under the American With Disabilities Act (ADA).
It is potentially going to have a disparate impact on women; more males pass the standards than females. As a result of that, federal law requires us to be able to show those physical fitness standards are job related and consistent with business necessity. In other words, it requires that we show that we are only disqualifying people from law enforcement through these physical fitness standards that cannot do the job of law enforcement in those different types of law enforcement that we cover through our certification. The essential mechanism for us to prove that those standards are job related is to have a validation in physical job task analysis done in the state of Nevada.
As Mr. Clark indicated, we currently use the Idaho standard. That standard was adopted as an interim measure with the hope that we would be able to do our own analysis and validation study in Nevada. As Mr. Clark said, that Idaho study essentially covered category 1 peace officers. It did not include, other than wildlife officers, any other category 2 or 3 officers. I believe it was an important interim step for P.O.S.T. to adopt these standards because they are supported by some validation. However, in the research I have done, I have been unable to find any cases that support transporting of validation study from one state to another state. That does not mean it is not appropriate. It means that the courts have not yet ruled on that issue. Because we have not completed an in-depth analysis of the job tasks involved in all of Nevada’s different categories, and because we have not demonstrated comparability as far as being able to transport those standards from Idaho to Nevada, I think we are in a tenuous position legally.
Senator Neal:
Is this based on some court case?
Mr. Jensen:
Validation requirements arise out of the American’s with Disabilities Act (ADA).
Senator Neal:
Again, my question is: Was that based on a court case that said you must have these validations?
Mr. Jensen:
Yes, Senator Neal. There are a number of court cases. I do not have the names of the court cases, but I can provide those cases to you. These cases have analyzed whether standards are job related and the courts in looking at that have required that there be scientific validation.
Senator Neal:
I asked this question for a reason. Most police departments have patrolmen, detectives, intelligence units, internal affairs and supervisory staff. So, are you saying that each one of these positions would meet certain standards or criteria in order to be a peace officer?
Mr. Jensen:
I believe the best answer to that is that we are setting up standards for certification of peace officers in Nevada, which deal with entry-level positions. Those people are coming into law enforcement and not necessarily into management.
Mr. Clark:
The individuals that you detailed would all be category 1 peace officers, even though there is a police officer working the street and transferred to a detective unit. That peace office has a full range of duties and could transfer back and forth for that particular agency. The differences we are talking about would be the one that would be farthest away from the full range of peace officers in category 3, which are confinement and correction officers. The ones that seem to cause confusion are the category 2 police officers, which could be parole and probation and juvenile officers. Category 2 and category 3 officers never have a full range of assignments, but have a specific range of duties that precludes them from this category.
Senator Neal:
Are you talking in terms of taking these individuals, whether category 1, 2 or 3 and putting them on a physical course, like a treadmill, and testing their physical fitness?
Mr. Clark:
Yes. We would determine through the job task analysis what specific jobs are required to be a peace officer in Nevada by category. Then the physical fitness validation study would validate the level of physical fitness that those individuals need to perform that job. Yes, in fact, we would be testing those people in that manner.
Senator Neal:
Would this include driving a car?
Mr. Clark:
Historically, the physical fitness tests are more looking at the standards for physical ability and some of those things would fit with a job task analysis, and possibly the need to be able to drive a car. What physical strength they would need to be able to drive that car and pursue situations is set by the physical fitness validation study.
Chairman Raggio:
We are trying to conserve money. Apparently the study that was initially contemplated, for which the $200,000 was requested, can be done for $150,000 according to your proposed amendment. The obvious question is why could you not utilize the study from Idaho, certainly for the category 1 peace officers. It is not going to change between here and Idaho regarding how far an officer needs to run, and so forth. So, why do we need to expend that amount of money? What is the basic amount you need for a study that covers peace officer jobs that have not been covered under the study? I am going to reiterate as a third party that I cannot understand why we need to do an additional study that has already been completed for Idaho. It cannot be any different between state standards in that particular category. I assume that is the major portion of the list of peace officers.
Mr. Clark:
The answer to your question is that you are correct. I agree that is the smartest and most fiscally responsible way to go, except for the fact that, as Mr. Jensen testified, we are not legally on defensible ground.
Chairman Raggio:
Why is this not defensible? If it is defensible in Idaho, it certainly should be defensible in Nevada.
Mr. Jensen:
The defensibility issue with regard to transporting standards across state lines is unknown.
Chairman Raggio:
Remember, we are trying to conserve money. What is absolutely necessary in order for Nevada to be defensible?
Mr. Jensen:
I always like to provide what would place a client’s strongest legal position.
Chairman Raggio:
No, let us not do that. Tell me what you think would be defensible for Nevada that would be most cost effective to meet this requirement.
Mr. Jensen:
The most cost effective method, although it has not been supported in the case law, is to do a transportability study in which a comparison could be done between Idaho’s job tasks and the job tasks in Nevada’s category 1. That can be done, although I am not an expert on scientific validation. However, because Idaho did not include category 2 with its diverse peace officers, it would be necessary for us to conduct our own study in Nevada. I do not know how much that costs.
Chairman Raggio:
I am going to suggest, Mr. Jensen and Mr. Clark, that you find out what the minimum amount is to do that kind of a study for those peace officers that are not covered under the Idaho study and what amount is necessary to demonstrate transportability. We want to accommodate the needs of P.O.S.T., but I am alerting you that we are going to be cutting all kinds of measures and rather than not process the bill, we would like to have you submit a proposal that would cover the need. Some day we may have to complete a full study, but let us try to accommodate your immediate needs as cost effectively as possible.
What about the other part that has been added. Was that added because you thought you had some extra money?
Mr. Clark:
No, Mr. Chairman. It was after this request to the Budget Division that I was enlightened that the sheriff’s and chiefs had serious concerns about ability to do training in specific areas. Basically, that was to develop advance training for supervisors and middle managers to address issues of ethical behavior, leadership, accountability, and inspection and control. This would assist the Nevada law enforcement community in preventing incidences of corruption and would increase professionalism. The law enforcement community in Nevada for specific advanced training wanted to develop specific advanced levels that would inoculate or help to prevent incidents of corruption that have occurred throughout the country.
Chairman Raggio:
What kind of incidents are you talking about?
Mr. Clark:
Incidents like the Los Angeles Rampart station (a corruption scandal in which anti‑gang officers allegedly planted evidence, shot unarmed suspect, falsified reports and gave false testimony to convict innocent people of crimes). This was primarily a breakdown in supervision. Other incidents have caused tremendous amounts of liability.
Chairman Raggio:
What will $50,000 buy in advance training to prevent incidents of corruption and increase professionalism?
Mr. Clark:
Mr. Chairman, we have formed a subcommittee from the sheriffs and chiefs association on training on this specific project. The subcommittee has looked at doing a one-day training in three different regions throughout the state for the executive officers in law enforcement to determine specifically for their region what their specific needs are in this subject area. There would then be another three days of training in each one of those regions and it would be repeated one time. So, we are looking at 21 days of training, perhaps looking at 25 to 30 middle managers and supervisors that would attend this training. There would also be a component within the training that would be a “train the trainer” component so these individuals would be able to go back to their agencies and other agencies and share this information.
Chairman Raggio:
Was this designed after some existing program somewhere?
Mr. Clark:
No, Mr. Chairman. This is something we are trying to design as we go.
Chairman Raggio:
You do not cover this kind of situation in the ordinary P.O.S.T. training?
Mr. Clark:
No, Mr. Chairman. The basic P.O.S.T. training would be for the academy, and this training is for supervisory level personnel. There are basic supervisors’ training courses, but there is very little training that is provided other than the basic skills of being a supervisor, even for middle managers.
Chairman Raggio:
Did the budget office approve this addition to the bill that was requested, Mr. Comeaux?
John P. Comeaux, Director, Department of Administration:
Yes, Mr. Chairman.
Chairman Raggio:
Mr. Clark, I suggest that you delineate for committee staff how you would utilize the $50,000 that has been requested.
Senator Jacobsen:
I hope the standards would be universal for all 50 states. In one sense you indicate that this is a “physique” standard as to an applicant. When I return to the liability part, are you addressing the state or federal judgment? I cannot see how you are tying this together if you are doing a standard, which should be a universal measurement. I have yet to see a challenge in the paper about someone challenging someone’s physique. There are some variables here that are not logical.
Mr. Clark:
The request for the job task analysis and validation study has nothing to do with a person’s physique. It also is not based on a judgment. It is the physical standards for what it takes to be a peace officer that we can defend. If we arbitrarily say, “You have to do 50 push-ups,” to be a peace officer, we are going to have a lot of lawsuits from many females and other people who may be challenged to some degree. There has to be some legally defensible scientific way of saying that, in the state of Nevada, we have studied and we can prove a level of competency. Otherwise, if we are below that level and say a person cannot be hired, we need to be able to defend that standard.
Chairman Raggio:
There being no further question from this committee, Mr. Murphy, would you like to add any comments?
P. Michael Murphy, Chairman, Peace Officers’ Standards and Training Commission:
Thank you, Mr. Chairman. I do not have anything to add to Mr. Clark’s presentation. However, if you have any questions of me, I would be happy to address them.
Chairman Raggio:
Is there is anyone else who would like to testify on this measure, please come forward.
Jackie Crawford, Director, Department of Prisons:
I would like to testify in support of S.B. 445. We would also like to share with this committee how this study evolved relevant to peace officer category 3. When I became the director, one of the major problems we were having was recruiting qualified people. Part of what we were discovering was that the standards were not job related to the work of the Department of Prisons. As a result, we did some extensive studies and effectively interfaced with P.O.S.T. I have with me this morning, Mr. Meligan, who has completed extensive study, and also discovered the Idaho study. I would like to defer to him at this time to inform this committee what our findings were, and the outcome since we have adopted, although temporarily, those standards that Idaho is using.
David Meligan, Warden, Northern Nevada Correctional Center, Department of Prisons:
We were involved in extensive research regarding physical fitness validation studies and essential functions of our staff members. We have over 1600 custody staff members and officers within our department. We were experiencing extreme vacancies with those positions. We looked at the reasons we were experiencing these vacancies. During that process, one of the things we discovered is that our process of recruitment resulted in a 38 percent failure rate of candidates who otherwise would be available to be hired by the Department of Prisons. These people were failing because of the physical fitness standards. We looked into the physical fitness standards and how those related to the essential functions of what these officers were doing in the workplace.
We found problems that were evident. For example, we did not see how we could support what we were making these staff members do during the testing process and how that directly correlated to the duties they were involved with at work. We looked back on how we got to that point and determined that there were initial studies in 1995 conducted by the Cooper Institute on Aerobics (Cooper). P.O.S.T. adopted a generalized standard that Cooper had published, which was a bunch of different validations that were conducted throughout the United States by various law enforcement agencies. They developed a generic validation that was utilized in the initial passing of the P.O.S.T. requirements. Since that period, Cooper had updated their validation studies. In every instance, it stated that each agency needed to conduct its own validation studies to ensure the employees they recruit are able to perform specific job functions of those jobs for which they are hiring these individuals.
From that point, we looked at what other states were doing and we corresponded with each different state. We conducted a transferability study with different validations.
Senator Neal:
I see two matters: job analysis and the validation. To me, these are two different types of animals. In job analysis, one is looking at the job, the person that is involved, and what that person is doing. If you are looking at validation, you are looking at the job to see whether or not the requirements to qualify for that job are what are actually needed. These are two different components. So, what are you doing? Are you going to do a job analysis, or are you going to do a validation study?
Mr. Meligan:
There are two different aspects to this. There are the essential functions of the position, and ultimately there is the validation. These two factors commingle. We need to know what these staff members have to do during their normal workdays. From that point, we conduct a validation to develop a certain required physical fitness level. Senator Neal used the example of driving a car. There is a determination that an individual must be able to do a certain number of push-ups, run a certain distance to be able to do that physical aspect of the job. Based on those essential functions that are work demanded a scientific testing process is developed, which is the validation study. The purpose is to get individuals through the testing mechanism that they are going to be able to perform that job.
Senator Neal:
Tell me how you would evaluate a tower guard’s job.
Mr. Meligan:
We would first look at the specific functions of what a tower guard does. These employees must be able to get to the tower; possibly, they would drive to that tower if a vehicle transfer is necessary. So, driving, walking and going upstairs are required. From that point, the individual would have to be able to use a portable radio. He would have to be able to use a telephone and an alarm system, be certified in the use of a weapon, and know how to react in a stressful situation, such as curbing disturbances. There is logic involved in the process of determining what needs to be done. Also, that person must know how to read and write to complete reports. All of these functions are building into the need for lifting, walking, running and those types of things.
Senator Neal:
These are the types of functions that you would hire a person for. These are job standards, are they not?
Mr. Meligan:
Yes, they are. But when we test people, we go through a written process and narrow the testing process down to certain aspects. We put all these things together because there are so many functions. For a correctional officer there are over 56 functions of that job. So, we need a validation study so that we can say, “Here is a group of areas that we are going to test an individual process to make sure they are going to be able to perform those 56 functions of their actual job.”
Chairman Raggio:
If there is anyone else who would like to testify on this measure, please come forward.
Wayne Carlson, Lobbyist, Nevada Public Agency Insurance Pool & Public Agency Compensation Trust:
I provide insurance for many of the rural Nevada police agencies in our program. We provide coverage for defense of liability cases that arise from violations of the ADA or other constitutional acts. We have had cases in which one of our rural agencies hired a person who appeared qualified to be a police officer, and sent that person to the P.O.S.T. Academy.
Unfortunately, the person did not meet the academy standards for entry or for graduation. Then that person filed a claim for wrongful discharge from employment for failing to meet the standard. Without a valid standard we have difficulty defending that agency. The validity is important for providing a legal defensibility for termination of an unqualified candidate who physically cannot perform the job. So, we would support the effort to ensure good standards so we have people who are qualified to perform the standards test of physical fitness.
Chairman Raggio:
What kind of litigation are you talking about? People who have been hired and then do not meet the standards and then they sue?
Mr. Carlson:
That is correct. They are terminated for not being able to complete the academy, which is a requirement to be sworn police officer, and then they sue.
Chairman Raggio:
Do they succeed in their suits?
Mr. Carlson:
So far we have had to defend a number of these suits and have been successful because of other reasons.
Chairman Raggio:
These individuals know that when they are hired they have to go through the P.O.S.T. Academy.
Mr. Carlson:
That is correct, Sir. But then if terminated, they sue under the ADA. In one case we had an individual who weighed over 300 pounds and could not even run. He began to run to get in shape to attend the academy and then could not meet the physical requirements.
Chairman Raggio:
Anybody can sue, but the question is will they be successful.
Mr. Carlson:
While we have been fortunate so far, these standards are important.
Chairman Raggio:
I am going to close the hearing on S.B.445. Mr. Clark please get the requested information back to committee staff as soon as possible. At this time we will open the hearing on S.B.442.
SENATE BILL 442: Makes appropriation to Department of Prisons for replacement equipment. (BDR S-1378)
Jackie Crawford, Director, Department of Prisons:
I am not sure exactly, but I am asking for leadership from the committee as to how you would like to go through this request.
Chairman Raggio:
Why don’t you highlight what you want $1 million for? Our list (Exhibit D, page 1) indicates your request for calculators and other items. Could you highlight your large ticket items you believe are essential to your operation? We do have your itemized list. When was this list prepared?
Janet Johnson, Assistant Director, Support Services, Department of Prisons:
The list was prepared as part of our supplemental budget request and was submitted on August 15, 2000. There are a number of large items, primarily vans, sedans, and a replacement microwave. I would like to point out you asked about an amendment. We have identified a couple of duplications in our list that require an amendment, which we have today. We can supply that to committee staff.
These are minor duplications. There are some secretarial chairs at the Jean Camp in the amount of $960 that are duplicated in the budget. There is also $5,532 for High Desert State Prison for a hand driven food transport cart that is duplicated in the budget.
Chairman Raggio:
In Exhibit D, page 11, you have itemized $54,000 for 16 institutional chairs. Is the correct figure $5,400?
Ms. Crawford:
Yes, that is a typographical error. The correct figure is $5,400.
Chairman Raggio:
My question is: are all of these items still necessary, or are there any items that may be deleted?
Ms. Johnson:
The items that I have identified to you may be deleted. Otherwise, we are indicating that we need all requested items.
Chairman Raggio:
Why don’t you give us a list of your department’s priorities, contemplating a 10 to 15 percent cut? Mr. Glab, do you have any comment to add?
Thomas A. Glab, P.E., Chief of Plant Operations, Department of Prisons:
The microwave is a telephone cable that runs from the central office to our microwave room at Northern Nevada Correctional Center (NNCC). “We have used up all of the telephone repair, the wires on that. If we do not get this replaced, we are going to have to do without on that item.” We tried to get that replaced last session.
Chairman Raggio:
Committee staff will need to go over your list with you, Ms. Johnson. We are asking all agencies to prioritize their requests on these kinds of bills. There being no further question or testimony on S.B.442, the hearing is closed. At this time we will open the hearing on S.B.443.
SENATE BILL 443: Makes appropriation to Department of Prisons for stables for wild horses for prison industries. (BDR S-1379)
Jackie Crawford, Director, Department of Prisons:
We are asking for an appropriation to the Department of Prisons for stables for the Prison Industries. Primarily, we are requesting $200,000 for the purpose of a loan that we will be paying back over a protracted period of time. The corrals will allow the department an opportunity to establish a place whereby we can contract with the Bureau of Land Management (BLM) to manage their horses. As a result there will be a revenue stream that we hope to generate from this. This is investment money that we are asking this committee to consider.
Chairman Raggio:
Is there any reason this could not be funded out of the Prison Industries Fund, rather than the General Fund?
Ms. Crawford:
I am not sure about that. I would have to research it.
Ms. Johnson:
My understanding is Prison Industries does not have sufficient money to provide this start up.
Chairman Raggio:
Why don’t you track that with our committee staff and see if there is available money, particularly if there is going to be revenue going into that project.
Ms. Johnson:
I believe it will take a while until the revenue generates from this project.
Chairman Raggio:
Who else would like to testify on S.B.443?
Robin Bates, Warden, Warm Springs Correctional Center, Department of Prisons:
The Department of Prisons currently works with the State Department of Agriculture in operating holding facilities and general programs for state horses. We have had success in that program and have recently doubled its size. It is a relatively small program compared to the federal program. Nevada is home to over half of the wild horse population in the United States. BLM has an aggressive capture policy, which, over the next 10 years, will remove anywhere from 6,000 to 10,000 horses per year from the ranges in the United States.
The BLM is motivated to locate a holding facility in Carson City to reduce the freight costs of moving horses across the United States. In the last few years it has become popular to place these programs in correctional facilities because it serves the purpose of creating jobs for inmates. We help BLM manage this public policy and inmates learn employable skills. The program envisioned in this plan would be in Carson City at the Stewart Conservation Camp on 40 acres adjacent to the dairy. The $200,000 in this request would pay for corrals, the squeeze shoots, and the rail pins that would be necessary for the program. We have reduced the amount of the request to $200,000 by locating surplus equipment through the Department of Transportation for some of the corrals. The remaining money would be used to finish the construction. Within the next 10 days we will submit a proposal to BLM.
Chairman Raggio:
Have you given an itemization of that breakdown to committee staff?
Mr. Bates:
At the beginning of the session, we provided each member and the committee staff with a copy of our business plan. In the business plan is a line item budget for the $200,000.
Chairman Raggio:
Do you have inmates that would be capable of participating in this program?
Mr. Bates:
Yes, Mr. Chairman, we have a training program, which we have worked on for the last year. We take inmates having no experience and train them to the point where they become mentors. In turn, those mentors train other inmates. This program has been very successful.
Chairman Raggio:
Budget account 525-3719 shows the retained earnings in that fund, which is approximately $2 million. There appears to be sufficient money in that Prison Industry fund if we are going to do something like this.
Ms. Johnson:
I will talk to the Assistant Director of Prison Industries regarding that matter and find out what the situation is.
Chairman Raggio:
There being no further questions or testimony on S.B.443, the hearing is closed. At this time we will open the hearing on S.B.463.
SENATE BILL 463: Makes appropriation to Department of Prisons for maintenance projects at certain facilities. (BDR S-1432)
Jackie Crawford, Director, Department of Prisons:
Senate Bill 463 requests revenue for paint and a number of other items to maintain our facilities. As you may be aware, we have a lot of inmates and people that we house, as well as traffic, and ongoing maintenance is vitally important. We are asking for several areas that we believe are important in maintaining our facilities.
Chairman Raggio:
Committee staff is indicating there are some items here that appear to be ongoing expenses and are funded in the “one-shot” appropriation. That is highly unusual.
Janet Johnson, Assistant Director, Support Services, Department of Prisons:
I admit that it is highly unusual. With the budget requirements for “FY 2001 times two,” there simply were not sufficient funds in the budget to fund everything our department needed. Everything that fell outside that budget limit went into a separate request.
Chairman Raggio:
Ms. Johnson, there is one matter itemized in the director’s office for telephone communications in the amount of $71,000.
Ms. Johnson:
Yes, Sir. I misspoke a while ago. This is the one I was talking about. It is in this bill rather than the other one. We were able to receive some free cabling from the Department of Information Technology (DoIT), but in order to keep the microwave communications going, we need to replace those lines and this is the cost to implement that project.
Chairman Raggio:
Is that an ongoing request?
Ms. Johnson:
This item should be a one-time appropriation.
Chairman Raggio:
Is this the office you are going to move out of?
Ms. Johnson:
This is building 89. We are not going to move out of it, altogether. We are just spreading out.
Chairman Raggio:
We need to determine whether this request is going to be cost effective and whether it is wise to expend these funds in this manner.
Ms. Johnson:
I am not sure if this covers building 6, which ultimately we are considering moving into.
Chairman Raggio:
Please get with committee staff on that issue.
Chairman Raggio:
Anything else you would like to highlight? We will ask you to do the same on this with a 10 to 15 percent reduction listing the priorities of your department.
Is there anything further you would like to add before I close the hearing on S.B.463?
Ms. Crawford:
Mr. Chairman, let me say to this committee that we have prioritized our requests very carefully. I believe our department has been very frugal in attempting to itemize. But, we certainly will go back and attempt a 10 to 15 percent reduction.
Chairman Raggio:
It has become necessary to trim all budgets. We want to give you the opportunity to tell us where you want that reduction, as opposed to any arbitrary reduction we may not be familiar with.
Let us open the hearing on S.B.517.
SENATE BILL 517: Makes appropriation to restore and increase balance in reserve for statutory contingency account. (BDR S-1512)
John P. Comeaux, Director, Department of Administration:
Good morning, Mr. Chairman and members of the committee. S.B.517 is a request for an appropriation of $3 million for the Reserve for Statutory Contingency Account. Our five-year average in expenditures out of that account is $1.6 million. In the current biennium the appropriation that was made to the account was $1.5 million. If you recall, we made two or three trips to the Interim Finance Committee (IFC) for an allocation from the IFC Contingency Fund to replenish that account during the interim. That is why we have recommended allocation here that is double what we had last time. The heavy expenditures out of that account vary from interim to interim. During this most recent interim, the heaviest expenditures have been for post-conviction relief and forestry reimbursement related to the heavy fire season in 2000.
At the present time we have a balance of $9,300 remaining in that account. We have current requests for post-conviction relief payments of about $56,000 that currently are pending. So, for that reason, we would ask for expeditious action on this request.
Chairman Raggio:
We have both the Reserve for Statutory Contingency account, which is Nevada Revised Statutes (NRS) 353.264, and then the regular IFC Contingency Fund, which is NRS 353.266. Which of these funds does the forestry reimbursement pass through? What is the distinction between these two funds?
Mr. Comeaux:
Actually, both. The distinction between these two funds is which is the quickest one to get to. The amount in the Reserve for Statutory Contingency Account is limited. Normally an allocation would be made from that fund in the minimum amount necessary to assist a division, department or agency. The heavy allocations would be sought from the IFC Contingency Fund.
Chairman Raggio:
What I am leading up to is the expectation there may be higher than usual utility expenses during the biennium. A proposal was made that we would look to the Fund to stabilize operation of State Government, which I think is something this committee would not endorse. So, with the understanding that it may be necessary to look to the contingency account does this, together with the appropriation in S.B. 518, provide an adequate amount to cover any potential expense?
Mr. Comeaux:
Mr. Chairman, that will depend on what happens to utility rates. The suggestion that the “rainy day fund” could be looked to was made only in the event that utility rates increase “through the roof.” The Governor had mentioned there was a possibility rates could increase 50 to 60 percent. I do not think the Contingency Fund could handle that expenditure. However, in the budget we provided for increases in rates, or inflation, at 16 percent a year for electricity and 15 percent a year for natural gas. Unless we really missed the mark on what those rates will be during the entire course of the biennium, the amounts we have in the budget plus the Contingency Fund should be adequate, unless of course, we also have an active fire season. A bad fire season all by itself could take care of a large chunk of the Contingency Fund.
Chairman Raggio:
What percentage of fire suppression costs is generally reimbursed from the federal government or other agency?
Mr. Comeaux:
Again, Mr. Chairman, it depends on where the fire occurs. Historically, the bulk of that expense, about 70 to 80 percent, has been reimbursable. The problem is we need the money up front.
Chairman Raggio:
While we are at this, would you like to speak to S.B.518?
SENATE BILL 518: Makes appropriations to contingency fund to restore and increase balance in fund. (BDR S-1514)
John P. Comeaux, Director, Department of Administration:
Yes, Sir. Again, this appropriation would be to replenish the balance in the Interim Finance Committee Contingency Fund. I believe during this interim the balance in the fund is $8 million. We are recommending $9 million from the General Fund this time, plus, for the first time, an appropriation from the State Highway Fund of $2 million to the IFC Contingency Fund. During the most recent interim we had a problem at the Department of Motor Vehicles (DMV) to wrestle with, and the only solution IFC could come up with was a General Fund loan from the Contingency Fund to DMV to ultimately be repaid. So, we think it is a good idea to make an appropriation from the State Highway Fund to the IFC Contingency Fund, just in the event there is an emergency situation during the biennium.
Again, the $9 million we are recommending from the General Fund is $1 million more than this past time, which under ordinary circumstances should be adequate. I would be the first to admit, though, if we had a bad fire season and utility rates continue to rise, we could have a problem. I do not know how we foresee that circumstance. The amount we are recommending is reasonable. At the present time there is approximately $89,400 remaining in this fund.
Chairman Raggio:
There was an unusual expense out of the Contingency Fund last time to the Department of Taxation of almost $1 million.
Mr. Comeaux:
Yes, Sir. We should not have to face that the next time because The Executive Budget contains what should be adequate funding for the senior citizen project.
Chairman Raggio:
There was also almost $800,000 expense out of the Contingency Fund to the Office of the Secretary of State.
Mr. Comeaux:
That is correct. Also, I think we still have about $800,000 in reimbursements from forestry that should be redeposited to that fund when we collect.
Chairman Raggio:
There being no further question or testimony of S.B.517 or S.B.518, the hearing is closed. That completes the bills on our agenda. We now have closing sheets in closing list number 3 (Exhibit F).
DEPARTMENT OF MOTOR VEHICLES AND PUBLIC SAFETY
DMV, Salvage Wreckers/Body Shops – Page DMV-45 (Volume 3)
Budget Account 101-4690
Chairman Raggio:
What is the staff recommendation to DMV, Salvage Wreckers/Body Shops?
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic presented a brief overview of this agency documented in Exhibit F, page 2).
Good morning, Mr. Chairman and members of the committee. Staff recommends the following:
1. An adjustment to the cost of the vehicle recommended in decision unit E-710 to reflect a four-passenger vehicle, as is currently used in this program, rather than a full-sized, six-passenger sedan as recommended in The Executive Budget.
2. A change in the category designation for the intra-agency cost allocation proposed in decision unit E-801 to better identify expenses associated with the allocation.
3. An adjustment to include state-owned building rent in this budget account based on information provided by the department regarding space occupied by this program and the finalization of rates for state-owned building rent.
4. An adjustment to the cost allocation in E-801 based on final approval of the budgets Administrative Services Division and the Director’s Office budget accounts.
Chairman Raggio:
Mr. Comeaux do you have any objection to those recommendations?
John P. Comeaux, Director, Department of Administration:
No, Mr. Chairman, we have no objection.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 101‑4690 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO THOSE ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR JACOBSEN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
DMV, Project Genesis – Page DMV-62 (Volume 3)
Budget Account 201-4739
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit F, page 3.)
Staff recommends closing this budget account as recommended by the Governor with no adjustments.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 201‑4739 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
DMV, Records Search – Page DMV-64 (Volume 3)
Budget Account 201-4711
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit F, page 4.)
Staff recommends the following adjustments:
1. An increase in revenues based on agency projections. Increased revenues will revert to the State Highway Fund.
2. The removal of modular building expenses of $10,786 in FY 2003. This expense was initiated to enable the Record Search section to relocate while the headquarters building was remodeled. The State Public Works Board projects the remodel to be completed by the fall of 2001 eliminating the need for this expense.
3. An adjustment to the cost of the computers based on revised prices from the State Purchasing Division.
4. A change in the category designation for the intra-agency cost allocation proposed in decision unit E-801 to better identify expenses associated with the allocation.
5. An adjustment in state-owned building rent in this budget account based on information provided by the department regarding space occupied by this program and the finalization of rates for state-owned building rent.
6. Changes to the cost allocation in E-801 and the transfers in E-924 and E-946 based on the final approval of the budgets for the Administrative Services Division, Director’s Office, and Highway Patrol Division.
Chairman Raggio:
What fees are currently charged? Are you recommending an increase in fees or just an increase in the total revenue?
Mr. Krmpotic:
That would be an increase in total revenue.
Chairman Raggio:
This is the budget where insurance companies and vehicle ownerships and attorneys call to get information. What kind of fee are they charged?
Mr. Krmpotic:
I am not sure what that fee is currently.
Chairman Raggio:
The report shows revenue for records search of $5.6 million. The agency had suggested $5.8 million in its request. Why was it cut to $5.6 million and what is staff recommending as an increase in revenue?
John P. Comeaux, Director, Department of Administration:
I do not know why we reduced that from what the agency has requested. I believe staff’s recommendations are based on revised revenue estimates as provided by the agency.
Chairman Raggio:
What is staff recommending?
Mr. Krmpotic:
Staff recommends adjustments that would bring revenue authority to approximately $6.2 million in FY 2002 and just under $6.4 million in FY 2003.
Chairman Raggio:
Mr. Comeaux, do you have objection to those recommendations?
Mr. Comeaux:
No, Sir.
Chairman Raggio:
We are going to see an adjustment on all of the budgets for computers, based on revised prices from the State Purchasing Division. I will accept a motion to close the budget with the adjustments recommended by staff, including the additional revenue.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 201‑4711 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF, INCLUDING THE ADDITIONAL REVENUE.
SENATOR NEAL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
DMV, Hearings – Page DMV-77 (Volume 3)
Budget Account 201-4732
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit F, page 6.)
Staff recommends the following:
1. Adjustment in decision unit M-100 for recommended rates for vehicle comprehensive and collision insurance and vehicle liability insurance.
2. The Budget Office has submitted an amendment to correct the step level for the supervising legal secretary position in decision unit M-303, occupational studies. Staff recommends the inclusion of the adjustment, which results in an increase in State Highway Funds of $11,604 in FY 2002 and $10,371 in FY 2003.
3. An adjustment to the cost allocation in E-801 and the transfers in E-928 and E‑996 based on the final approval of the budgets for the Administrative Services Division, Director’s Office and Highway Patrol Division.
Chairman Raggio:
Is that in accordance with your request Mr. Comeaux?
John P. Comeaux, Director, Department of Administration:
Yes, Sir.
Chairman Raggio:
Cost allocations in E-801 are included in all these budget closings. So, let us make that understood. You need not talk about those recommendations that are standard throughout. That would be understood throughout these closings. Are there any objections to any of these recommendations, Mr. Comeaux?
Mr. Comeaux:
No, Mr. Chairman.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 201-4732 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Public Safety, Highway Safety Grants Account – Page PS-90 (Volume 3)
Budget Account 201-4721
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit F, page 7.)
Staff recommends the following adjustments:
1. A change in the category designation for the Intra-agency cost allocation proposed in decision unit E-801 to better identify expenses associated with the allocation.
2. Adjustment to the cost allocation in E-801 and the transfers in E-928 and E-996 based on the final approval of the budgets for the Public Safety Technology Division, Administrative Services Division and the Director’s Office.
Chairman Raggio:
Are there any objections to committee staff recommendations, Mr. Comeaux?
John P. Comeaux, Director, Department of Administration:
No, Mr. Chairman.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 201-4721 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Public Safety, Traffic Safety – Page PS-136 (Volume 3)
Budget Account 101-4687
Mark Krmpotic, Program Analyst: (Note: Mr. Krmpotic’s brief overview of this agency is documented in Exhibit F, page 8.)
Staff recommends the following adjustments:
1. Grant funds for the traffic records and data systems improvement grant have been adjusted in FY 2002-03 to reflect continuation of this grant. These funds flow to the Highway Safety Plan & Administrative budget account (4688) to fund a Traffic Records Manager position and associated expenses to develop a traffic records system. This adjustment reflects the receipt and transfer of $150,000 to correspond to the receipt of funds in the Highway Safety Plan & Administrative budget account.
2. Staff anticipates the removal of the purchasing assessment based on final submittal by the Budget Division since purchases and contracts are not made directly from this budget account.
Chairman Raggio:
Are there any objections to committee staff recommendation, Mr. Comeaux?
John P. Comeaux, Director, Department of Administration:
No, Mr. Chairman.
Chairman Raggio:
I do not know whether the joint subcommittees are looking into these items, but there are certain things the state has to enact or highway funding is in jeopardy. As I recall, we had to pass the “helmet law,” as well as minimum requirements for drunk driving. Are those still in effect? For example, there is a bill to repeal the helmet law circulating this pending session. If we repeal the helmet law for motorcycles, would that put funding in jeopardy?
Mr. Krmpotic:
I am not aware of potential sanctions for highway funds as a result of the helmet law. I do know the federal government recently passed legislation that basically encourages states to pass the .08 blood alcohol level for presumption of driving while intoxicated. There are potential sanctions in highway funds that would be assessed against the state if the laws are not passed by a certain time frame.
Chairman Raggio:
I would like to ask committee staff to check on those initiatives that are still required, or for which we would face sanctions or loss of highway funds or other grants.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 101-4687 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
COLORADO RIVER COMMISSION
Fort Mojave Development Fund – Page CRC-7 (Volume 3)
Budget Account 296-4496
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 8.)
Staff recommends closing the Fort Mohave Development Fund account as recommended by the Governor.
Chairman Raggio:
Mr. Comeaux, there is a bill to take the Colorado River Commission (CRC) out from under the State Budget Act. What is the effect of that?
John P. Comeaux, Director, Department of Administration:
Basically, the effect would be that CRC would no longer be subject to the requirement for work program approval and other matters provided for in the State Budget Act. That is essentially the main effect. So, Interim Finance would not have CRC appear in front of them anymore.
Chairman Raggio:
The CRC would no longer submit a budget to the Budget Division?
Mr. Comeaux:
No, Sir. I believe they would submit a budget directly to the Legislature. The thinking is that, because of the process that they go through locally with the water district, there is no point in their being subject to these kinds of state checks.
Chairman Raggio:
I am not clear on what the purpose of E-376 is to make the $1.2 million available to Clark County for infrastructure improvements. Is this something they have always had in their budgets? What does that authority provide for?
Mr. Rodriquez:
There is a standard agreement between CRC and Clark County that the CRC will try to sell the land in the area. All the revenue from the sale of the land in the Laughlin area is made available to Clark County for development. Clark County has a $13.6 million infrastructure plan. This money would be available in case they can find some use for it.
SENATOR MATHEWS MOVED TO CLOSE BUDGET ACCOUNT 296‑4496 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
CRC Research and Development – Page CRC-10 (Volume 3)
Budget Account 296-4497
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 11.)
Staff recommends closing the Research and Development account as recommended by the Governor.
Chairman Raggio:
Where does the funding come from to do this research?
Mr. Rodriquez:
It comes from power sales of Colorado River Commission customers.
Chairman Raggio:
They do not flow into this budget, do they? They have a balance forward and I do not see any revenues. They have $63,000, but in this budget under “deposits,” is that money from sales?
Mr. Rodriquez:
No, those are administrative assessments on power customers.
Chairman Raggio:
They assess these power and water customers, put it in this budget and then use it for research, such as environmental powers in partnership with other states.
Mr. Rodriquez:
That is correct.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 296-4497 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Power Delivery System – Page CRC-13 (Volume 3)
Budget Account 502-4501
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 12.)
Staff recommends closing the Power Delivery System budget as recommended by the Governor.
Mr. Rodriquez:
I believe most committee members recognize this budget account. It has been before IFC several times for budgetary augmentations. The instability in the market has required CRC to submit several augmentations to increase its budget. Those anticipated increases in power costs are reflected in this budget.
Chairman Raggio:
The Governor does not make any recommendation in these budgets, does he, Mr. Comeaux? Your office does not make changes to CRC budgets, right?
John P. Comeaux, Director, Department of Administration:
No, Sir. Not unless the agency requests it.
Chairman Raggio:
You are anticipating in M-200 a significant increase in the authority to make power purchases and sales on behalf of the Southern Nevada Water Authority. That increases from about $35 million to about $87 million. Have they given you some explanation for that?
Mr. Rodriquez:
Yes, Sir. That has been discussed in IFC twice recently. With the instability of the power market in California, Washington and other states, there are several factors leading to the significant increases in power costs. CRC acts like a “power” broker.
Chairman Raggio:
Is that because of the cost of the power operation?
Mr. Rodriquez:
Yes, Sir. This fund supplies supplemental income for energy to be purchased on the open market, which increases that cost CRC has to pay. In return, the power they sell correspondingly increases to the customer.
Chairman Raggio:
No one at this point can determine what the cost will be in the next biennium. This is increased authority to cover that?
Mr. Rodriquez:
That is correct, Mr. Chairman. That is the agreement in line with what is currently authorized. They do believe they are going to have to ask for augmentation sometime in the biennium.
Chairman Raggio:
There is a good argument to keep these agencies within the Budget Act, so that the IFC can monitor these budgets and what their costs are.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 502-4501 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
* * * * *
Power Marketing Fund – Page CRC-16 (Volume 3)
Budget Account 505-4502
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 10.)
Staff recommends closing the Power Marketing Fund as recommended by the Governor. Again, this is the agency’s best guess at to where they will be in the coming biennium, hoping the industry stabilizes some point in the near future.
Chairman Raggio:
Under the work program for FY 2001, it is reflected that power sales expenditures were $58 million plus. Is that realistic, since now it is over $186.2 million? Is that correct?
Mr. rodriguez:
That is correct.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 505‑4502 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
MILITARY
Adjutant General Construction Fund– Page MILITARY-6 (Volume 3)
Budget Account 101-3652
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 14.)
Staff recommends closing the Adjutant Construction account as recommended by the Governor.
Chairman Raggio:
We received information on this on February 7, 2001.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 101-3652 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
BUSINESS AND INDUSTRY
B&I, Captive Insurers– Page B&I-45 (Volume 2)
Budget Account 101-3818
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 15.)
Staff recommends a technical adjustment based on the amount of premium tax revenues collected to date from captive insurers, with concurrence from the agency. Therefore, staff is recommending an adjustment to be made to GL 4325, Premium Tax Collections, in the amount of $17,500 in FY 2002 and $23,500 in FY 2003 with a corresponding adjustment to reserves.
Chairman Raggio:
Are all companies required to set up a captive insurance company for their operations?
Mr. Rodriquez:
No, they are not required to. It is an option for them to establish an entity within their own organization to insure their business interests. Again, those captive insurers will only address the business risks of the parent company.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 101‑3818 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION AND ADJUSTED FOR THE INCREASED PREMIUM TAX COLLECTION.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
B&I, Insurance Recovery– Page B&I-47 (Volume 2)
Budget Account 101-3821
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F.):
Staff recommends closing the Insurance Recovery budget account as recommended by the Governor.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 101-3821 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
B&I, Nat. Assoc. of Insurance Commissioners – Page B&I-55 (Volume 2)
Budget Account 101-3828
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 16.)
Staff recommends closing the National Association of Insurance Commissioners budget account as recommended by the Governor.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 101-3828 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
B&I, Insurance Cost Stabilization – Page B&I-59 (Volume 2)
Budget Account 101-3833
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 16.)
Staff recommends the following technical adjustments:
1. A technical adjustment in E-710 to delete the $15,000 in funding associated with the recommendation for the replacement of the division’s file server. On Thursday, February 8, 2001, the division’s server “crashed” and the division was forced to replace the system immediately. The division had planned to replace the server in FY 2002. The server was replaced on or about February 2001.
2. A reduction of $864 is also made to reflect a revision to personal computer prices as indicated by the State Purchasing Division.
SENATOR O’DONNELL MOVED TO CLOSE BUDGET ACCOUNT 101‑3833 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
* * * * *
B&I, Mfg. Housing Education/Recovery – Page B&I-88 (Volume 2)
Budget Account 271-3847
Jim Rodriquez, Program Analyst: (Note: Mr. Rodriquez’s brief overview of this agency is documented in Exhibit F, page 19.)
Staff recommends a technical adjustment to the recommended amount for personal computer replacement equipment to be made to reflect the latest prices from the State Purchasing Division.
Chairman Raggio:
How is this budget funded?
Mr. Rodriquez:
This is funded by a $15 assessment on renewed licenses or new licenses.
Chairman Raggio:
Licenses for whom?
Mr. Rodriquez:
For manufacturers of mobile homes and sales.
Chairman Raggio:
That is a separate recovery fee and is it identified as such?
Mr. Rodriquez:
Yes.
Chairman Raggio:
Anyone who has a claim because of something being irregular in the sale or someone has a complaint can make a claim against this account.
SENATOR NEAL MOVED TO CLOSE BUDGET ACCOUNT 271-3847 IN ACCORDANCE WITH THE GOVERNOR’S RECOMMENDATION SUBJECT TO ADJUSTMENTS RECOMMENDED BY STAFF.
SENATOR O’DONNELL SECONDED THE MOTION.
THE MOTION CARRIED. (SENATORS JACOBSEN AND COFFIN WERE ABSENT FOR THE VOTE.)
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Chairman Raggio adjourned the meeting at 10:06 a.m.
RESPECTFULLY SUBMITTED:
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ElizaBeth Root
Committee Secretary
APPROVED BY:
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Senator William J. Raggio, Chairman
DATE:
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