MINUTES OF THE

SENATE Committee on Government Affairs

 

Seventy-First Session

March 30, 2001

 

 

The Senate Committee on Government Affairswas called to order by Chairman Ann O'Connell, at 11:47 a.m., on Friday, March 30, 2001, in Room 2149 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 Ann O'Connell, Chairman

Senator William J. Raggio, Vice Chairman

Senator William R. O’Donnell

Senator Jon C. Porter

Senator Joseph M. Neal, Jr.

Senator Dina Titus

Senator Terry Care

 

GUEST LEGISLATORS PRESENT:

 

Senator Lawrence E. Jacobsen, Western Nevada Senatorial District

 

STAFF MEMBERS PRESENT:

 

Kimberly Marsh Guinasso, Committee Counsel

Juliann K. Jenson, Committee Policy Analyst

Julie Burdette, Committee Secretary

 

OTHERS PRESENT:

 

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

Michael O. Spell, CPA, Audit Supervisor, Audit Division, Legislative Counsel Bureau

Richard Neil, Deputy Legislative Auditor, Audit Division, Legislative Counsel Bureau

Maud Naroll, Chief Assistant, Planning, Budget Division, Department of Administration

Carole Vilardo, Lobbyist, Nevada Taxpayers Association

Robert Barengo, Lobbyist, Reno Sparks Convention and Visitors Authority

Gary Sayer, Concerned Citizen, Washoe County

Emily Braswell, Lobbyist, Director, Truckee Meadows Regional Planning Agency

John Slaughter, Lobbyist, Washoe County

Mary Henderson, Lobbyist, City of Reno

 

Chairman O'Connell opened the hearing at 11:47 a.m. on Senate Bill (S.B.) 426.

 

SENATE BILL 426:  Establishes requirements and procedures for strategic planning for state agencies. (BDR 31-429)

 

Wm. Gary Crews, CPA, Legislative Auditor, Audit Division, Legislative Counsel Bureau, came forward to testify on S.B. 426.  Mr. Crews went over the executive summary (Exhibit C.  Original is on File at the Research Library.) of the audit on strategic planning in state government.  He pointed out the section, Managing for Results (MFR), which indicated in 1999, Nevada had ranked approximately 24 nationwide in strategic planning, and now in 2001, there were approximately 30 states ahead of Nevada. 

 

The purpose of this audit, he stated, was to evaluate the state’s strategic planning efforts and identify opportunities for improvement.  He noted it included a review of the current strategic planning process and the most recent strategic plans for selected executive branch agencies.

 

Mr. Crews indicated budget instructions had gone out from the last biennium and had also addressed different agencies.  He noted the Department of Administration’s recommendation for strategic planning, etcetera, was the basis for developing the budgets.  He explained S.B. 426 was the result of the audit approved by the Legislative Commission in September 1998, and in August 2000, the audit was presented to the Audit Subcommittee of the Legislative Commission. 

 

Mr. Crews noted strategic planning was a long-term process of assessment, goal setting, and decision-making that mapped a path between the present and the future.  He explained a strategic plan defined what an organization sought to accomplish, and identified a strategy the organization would use to achieve the desired results.  Furthermore, Mr. Crews elaborated, a strategic plan was a starting point for an organization’s performance measurement efforts.  He pointed out strategic planning required an organization to verbalize a mission statement, goals, and how to attempt to achieve those goals.  The information, he informed the committee, would allow the executive branch agencies to make improvements for future operations.  Mr. Crews declared the Council of State Governments identified strategic planning as being one of the most effective management tools designed to deliver more value for the tax dollar, including benefits for establishing management direction, clarifying agency priorities, and setting guidelines for policy decisions.  Mr. Crews said he had surveyed approximately five different states which had strategic planning processes in place for a number of years.  He noted the officials from the legislative and executive branches of those states had assured him this was a worthwhile process, noting an increased accountability and improved resource allocation were a few of the benefits mentioned.  There were several recommendations from the audit, he said, including one recommendation requesting legislation requiring state agencies to prepare comprehensive strategic plans, and secondly, guidance to be provided to state agencies on preparing strategic plans and fully utilizing plans as a management tool in the decision-making process.  He emphasized this would also provide an additional oversight to state agencies in their strategic planning efforts. 

 

Mr. Crews pointed to various sections of the statutes which had been identified in the body of the report, alluding to elements of strategic planning that had been in place in Nevada for some time.  However, he said, the state did not have a comprehensive requirement for all the elements of strategic planning.  He noted S.B. 426 attempted to better define strategic planning and the Department of Administration’s requirement for executive branch agencies to adopt strategic plans.  Mr. Crews, said, in his opinion, all agencies should have a strategic plan in effect.

 

Michael O. Spell, CPA, Audit Supervisor, Audit Division, Legislative Counsel Bureau, pointed to the Executive Summary (Exhibit C) and went on to explain the purpose of the audit.  He said the purpose was to evaluate the state’s strategic planning efforts and to identify opportunities for improvement, which included a review of the current strategic planning process, and the most recent plans for selected executive branch agencies.  The results, he said, showed Nevada law required the development of some elements of strategic planning but not a complete plan, and consequently, agencies had conducted strategic planning for a variety of reasons.  Mr. Spell pointed out this had led to a number of formats and a wide variation in the quality of agency plans.  Recent reports issued by the legislative auditor, he noted, illustrated the inadequacy of strategic planning had resulted in ineffective management of certain state programs; therefore, Mr. Spell stated, legislation was needed to provide direction for the state’s ongoing strategic planning efforts as a priority. 

 

Mr. Spell explained the federal government, in the states surveyed, had statutory requirements for agencies to prepare strategic plans.  Similar requirements, he explained, did not exist in Nevada statute; consequently, there was inadequate strategic planning, and some of the programs, affected by lack of planning, were the group health insurance program for state employees, information systems development, and inmate medical services.

 

Mr. Spell, continued, saying better strategic planning in these programs might have avoided or lessened the extent of the identified problems.  He stated strategic plans surveyed often lacked basic elements, which included a mission statement, philosophy, external and internal assessment, goals, objectives, and time based performance measures.  Mr. Spell called attention to the fact that very often the strategic plan had not been communicated to staff, and indicated training and central oversight were key factors to a successful plan.

 

Mr. Spell summarized, saying since statewide strategic planning had been initiated in 1994, the Department of Administration had provided limited guidance and oversight in the departmental level planning process.  For instance, he said, the department had provided only one, brief, training session on the preparation of strategic plans, and furthermore, the department had not updated the agencies’ plans when they were revised in 1996 and 1998.  As a result, Mr. Crews stated, the department had limited assurance that strategic plans addressed key planning elements, and repeated the officials in other states indicated training and central oversight were key factors to successful planning.

 

Mr. Crews pointed out to the committee that in fiscal year 2000, the state spent approximately $4 billion, and the figure would continue to grow.  Mr. Crews emphasized he did not see how the state could afford not to have a plan in place, and also he did not believe the fiscal note attached to S.B. 426, prepared by the Department of Administration, was accurate, he said, the number was inflated.  In fact, Mr. Crews said, he would question if there were an additional cost attached to strategic planning, because efforts had been put forth in the past, and the Legislature had given the resources for the establishment of an office for planning and management training and controls, and it was his opinion some of the duties relating to strategic planning could be absorbed by the existing offices.  Mr. Crews maintained he did not see real obstacles to strategic planning.

 

Senator Raggio asserted, without complete refutation of the fiscal note, he did not see how the committee could process the bill, in anticipation of re-referring S.B. 426 to the finance committee.

 

Chairman O'Connell stated if strategic plans were not in place, how could this committee move forward as the committee could certainly not approve a $1 million budget.  Senator Raggio suggested that John P. Comeaux, Director, Budget Division, Department of Administration, be invited to come before the committee and give testimony regarding the fiscal note as he had signed off on it. 

 

Chairman O'Connell asked Mr. Crews to work with the fiscal division to ascertain exactly why they thought it would cost an additional $1 million to implement this.

 

Senator Neal made the observation that the strategic plan should be based upon the Nevada Revised Statutes (NRS); therefore, the planning function should be found in NRS, and no money should be involved at all.

 

Mr. Crews pointed out to the committee, the fiscal note contemplated the creation of a centralized strategic planning office, and he did not believe that was the way to deal with this issue.  Rather, he said, the organizations which carry out the programs would have to be the ones to create the strategic plans.  Mr. Crews said that would be the appropriate place for this, not a centralized agency.  The centralized agency, he commented, could provide training.  He emphasized strategic planning would have to be done by the agency required to carry out the program.

 

Senator Care stated his thoughts as an observation also, you should be able to walk into any agency and ask any employee, what do you do, and what does your department do, and the employee should be able to answer those two questions. 

 

Richard Neil, Deputy Legislative Auditor, Audit Division, Legislative Counsel Bureau, explained to the committee he would like to reiterate Mr. Crews’ comments about the existing resources where plans had been written in 1994, revised in 1996 and again in 1998, and in the current budget cycle, 2000, departments were expected to revise their plans which also had been done with the existing resources.  He emphasized this clearly took time, but needed to be accomplished by the managers and agency personnel.  To some extent, he noted, the departments had been doing this.  He said the training provided, to date, had focused on performance measurements, but if some additional training could be provided on strategic planning, additional costs would be involved.  Mr. Neil stated those costs could be minimal.

 

The chairman restated the committee’s appreciation for the explanation of S.B. 426, and the committee would obtain more information regarding the fiscal note, and perhaps be able to eliminate it.

 

Maud Naroll, Chief Assistant, Planning, Budget Division, Department of Administration, reiterated the state had done strategic planning in the past but S.B. 426 would provide the vehicle to do strategic planning properly.  The fiscal note proposed required training for people in the planning group, and the people in the departments who would be writing the plans and implementing the plans, missions and goals.  She noted the budget division would provide assistance, but would require additional training and resources for the departments themselves in writing the plans correctly. 

 

Chairman O'Connell pointed out the head of an agency or a superintendent should know the job and the proposed direction in which the agency would be moving.  The chairman questioned whether or not most of this had been discussed in the fundamental review.  Ms. Naroll replied, the fundamental review was a very large external and internal assessment.  She said strategic planning, goals, objectives and strategies, and how to measure whether the objectives had been reached, had not been a part of fundamental review. 

 

Chairman O'Connell reiterated it would be important to speak with Mr. Comeaux.  She said she also thought it would be helpful to the committee to have more information on what was specifically needed for agencies to write strategic plans.

 

Ms. Naroll maintained it was certainly a basis for the next round of strategic planning, but only as one of the pieces.  She stressed there were many components to a strategic plan, other than the external and internal assessment.  Ms. Naroll also pointed out the actions taken by the Legislature and the federal government would change the environment of the agencies.

 

Chairman O'Connell declared it would be very helpful to the committee to receive a report from Ms. Naroll on what was not being done as far as the fiscal note was concerned, and also what the department was doing that would get them to the strategic planning.  Again, the chairman stressed, $4 billion was a lot of money.  Chairman O'Connell said she appreciated Ms. Naroll’s comments, but repeated it would be important for the committee to hear from Mr. Comeaux.

 

Carole Vilardo, Lobbyist, Nevada Taxpayers Association, came forward to speak in support of S.B. 426.  Ms. Vilardo stressed any business had to have a strategic plan, as the plans were a measurement device.  Ms. Vilardo noted administrations do change periodically and it might be beneficial to new agency heads to see what the direction had been, and what elements might fit with the new administration’s goals.  Possibly the budget needed to be pared down to address only larger agencies first, Ms. Vilardo maintained, but strategic planning elements should be in the state’s budget, so as the members of the finance committees reviewed the budget, they would be able to see if target dates, goals, etcetera were being met.

 

Chairman O'Connell asked Ms. Vilardo, based on the plan for a department, why it should matter if a change in administration had taken place.  There was a goal for the department and the function or job description of the administrator was to carry out the plan, not to change it necessarily, perhaps improve upon it; but the goal would remain the same.  Ms. Vilardo responded a federal mandate could change the direction.  She clarified a strategic plan was an all-encompassing plan and if the agency was not on track, it would have to identify why that was the case, and the strategic plan would provide the measurements to identify the problem.

 

Chairman O'Connell closed the hearing on S.B. 426 and opened the hearing on S.B. 350.

 

SENATE BILL 350:  Increases membership of county fair and recreation board in certain counties. (BDR 20-685)

 

Senator Lawrence E. Jacobsen, Western Nevada Senatorial District, explained the people of Incline Village had asked the senator to sponsor S.B. 350 as they were part of Washoe County.  He said the people of Incline Village felt as though they did not have a voice, that they had been disenfranchised.  Senator Jacobsen believed this was true in all four counties he represented, especially with the reapportionment issue coming up

 

Robert Barengo, Lobbyist, Reno Sparks Convention & Visitors Authority (RSCVA), pointed out the it was through the RSCVA that the bill was brought forward on behalf of Incline Village and he was there in support of S.B. 350.  Mr. Barengo drew attention to the previous session when the Legislature had passed S.B. 477 of the Seventieth Session.

 

SENATE BILL 477 OF THE SEVENTIETH SESSION:  Raises tax on rental of transient lodging with Washoe County to pay certain costs related to promotion of tourism.  (BDR 20-1641)

 

Mr. Barengo asserted section 3 of S.B. 477 set into statute that the Lake Tahoe Incline Village and Crystal Bay Visitors Bureau was to receive 50 percent of the proceeds of the tax imposed, but the residents only had an informal seat on the board of the Reno Sparks Convention and Visitors Authority.  Mr. Barengo read the proposed amendment (Exhibit D) into the record: 

 

(5) One member who is a representative of other business or commercial interests, including gaming establishments, from a list of nominees submitted by a visitors’ bureau, other than the county fair and recreation board or a bureau created by such a board, that is authorized by law to receive a portion of the tax on transient lodging, if any.  If no such bureau exists in the county, the nominations must be made by the chamber of commerce of the third largest township in the county.

 

Mr. Barengo stated Incline Village was the third largest township in the county, and they received the tax money; therefore, they should be the ones to have a representative on the board of the RSCVA.

 

Senator Raggio queried whether Mr. Barengo had checked with the bill drafter as to whether that was feasible.  Mr. Barengo emphasized the language of the amendment had been written by the attorney for the RSCVA and Brenda Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau. 

 

Chairman O'Connell asked Senator Jacobsen if he had any difficulty with the amendment as presented by Mr. Barengo.  Senator Jacobsen remarked he had no objections to the amendment. 

 

Senator O’Donnell noted the people who lived in Incline Village and Crystal Bay rented their homes and asked if that was a part of the 50 percent collected.  Mr. Barengo stated the tax paid on the transient rental lodging was 50 percent of what was collected in that township, and it would go to the visitors’ bureau from the RSCVA.  He further stated prior to S.B. 477 of the Seventieth Session there had been a written agreement, but the bill codified the agreement, placing it into statute. 

 

Chairman O'Connell closed the hearing on S.B. 350 and opened the hearing on S.B. 383. 

 

SENATE BILL 383:  Revises voting procedures for certain regional planning commissions. (BDR 22-1162)

 

Senator Jacobsen noted he had been asked to sponsor S.B. 383 and that Gary Sayer, Resident, Unincorporated Washoe County, would explain the bill to the committee. 

 

Mr. Sayer, Concerned Citizen, Washoe County, expressed his support of S.B. 383.  He stated NRS 278 needed the revised language (Exhibit E) to ensure the future outcomes of regional planning met the declaration of legislative intent of NRS 278.0261.  Mr. Sayer went on to say it was his belief the manner in which regional planning for Reno, Sparks and Washoe County took place did not enhance the long-term health and welfare of the county.  He maintained the local jurisdictions were only interested in tax revenues.  Mr. Sayer commented on a recent newspaper article which referred to regional planning, Reno’s goals for annexation, and county residents willing to pay more in taxes in order to remain outside the city.

 

Mr. Sayer asked the committee if taxation were an issue under NRS 278 in regional planning, and said it was not his understanding of the chapter.  He proposed adding the following language (Exhibit E) to section 7, after the word annexation:  “and or designating a sphere of influence.” 

 

Mr. Sayer questioned the meaning of “may not vote.”  He said if that meant members of the commission of the city or county who are not directly affected will not be allowed to vote on such an amendment, that was fine.  If that was not the case, he thought the language should be deleted and “shall not be allowed to vote” inserted.

 

Mr. Sayer also proposed the incorporation of NRS 278.0272 into NRS 278.0276 and offered the following as replacement language: 

 

The adoption of the plan and any amendment must be by resolution of the governing board carried by the affirmative votes of not less than two-thirds of the members who are allowed to vote.  Members of the board who represent a city or a county that is not directly affected by a proposed amendment to a plan regarding annexation or the designation of a sphere of influence shall not be allowed to vote on such an amendment.  All members of the board may participate in the hearings and consideration of such an amendment.

 

Mr. Sayer continued, saying if during the development, update or adoption of a regional plan, designation of spheres of influence and annexation arose, the same restrictions on voting to finalize or adopt by specific geographical area should be required in both NRS 278.0272 and NRS 278.0276.

 

Mr. Sayer stated it was his opinion past and current problems had been associated with how the governing board functioned.  He maintained boards were not harmonious, comprehensive or coordinated for meeting the unique needs and opportunities which were characteristic of some of the older neighborhoods in the county.  Mr. Sayer explained to the committee, on December 14, 2000, the governing board had approved plan amendments to establish spheres of influence for the City of Reno.  He went on, saying, Washoe County had previously appealed the planning commission’s ruling but was not successful.  It was also his understanding that Washoe County had filed suit against the governing board over another amendment which was pending an outcome.

 

In summary, Mr. Sayer said regional planning involving Reno, Sparks and Washoe County was not meeting the legislative intent of NRS 278.0261 and the revised language he proposed would be appropriate.

 

Chairman O'Connell asked for testimony in opposition to S.B. 383.

 

Emily Braswell, Lobbyist, Director, Truckee Meadows Regional Planning Agency, came forward to provide testimony (Exhibit F) on behalf of the regional planning commission.  On Wednesday, March 28, 2001, the Truckee Meadows Regional Planning Commission, she said, had taken action to oppose S.B. 383 as it was currently written.  Ms. Braswell explained the intent of the bill was not clear to the planning commission and it was thought to have a number of procedural and administrative difficulties.  She continued, saying annexation was a complex issue and there would be a number of administrative problems if S.B. 383 were enacted as written.  Ms. Braswell pointed out one of the primary concerns of the regional planning commission was any case brought before the regional planning commission was, by definition, regional.  She continued, saying this would impact all three local governments and other entities, such as the regional transportation commission, the school district and the airport authority.  Ms. Braswell noted the planning commission had directed her to work with Senator Jacobsen and staff.

 

John Slaughter, Lobbyist, Washoe County, stated the board of county commissioners had not taken a position on S.B. 383, so currently the board was neutral.  Mr. Slaughter remarked they would certainly want to review the amendments and were willing to work with the sponsor of the bill.  Chairman O’Connell asked when the board would be meeting again.  Mr. Slaughter replied they would meet on Tuesday, April 10, 2001.

 

Senator Raggio clarified the county was at odds with the city in this matter as well as other matters.  Mr. Slaughter agreed.  Senator Raggio mentioned several other bills dealing with the concept of spheres of influence and asked if this was a continuation of that disagreement.  Mr. Slaughter replied yes, this was part of that conflict.  Senator Raggio asked Ms. Braswell to clarify the position of the Truckee Meadows Regional Planning Commission.  Ms. Braswell stated the commission had taken an action in opposition to S.B. 383 as it was written.  Ms. Braswell further added she had not yet had an opportunity to take it to the governing board.

 

Mary Henderson, Lobbyist, City of Reno, testified the city council did oppose S.B. 383 as written, but they had not had the opportunity to see the amendments.  Ms. Henderson declared, perhaps even more important, would be the regional governing board.  She said this would impact them and they were in support of the votes the regional planning commissioners had made on this issue.  Ms. Henderson pointed out to the committee the process of the 5-year update of the regional plan was taking place now.  She commented some good rules and policies regarding annexation would result from that process.  She noted one would be the city’s position not to do any more forced annexations within Washoe County.  The county would like to see the issues dealt with through the 5-year plan update and public hearings, she said.

 

Chairman O'Connell suggested Ms. Henderson might wish to speak with Mr. Sayer and address some of his concerns in reference to the overall plan.  Ms. Henderson agreed.  The chairman closed the hearing on S.B. 383.

 

Chairman O'Connell drew attention to the bills that would be presented on the senate floor by the members of the committee:  Senator Titus would present S.B. 324 and Senator Care would present S.B. 255.  The chairman also commented to Senator Porter that he would be presenting S.J.R. 7.

 

Chairman O'Connell adjourned the meeting at 1:01 p.m.

 

 

RESPECTFULLY SUBMITTED:

 

 

Julie Burdette,

Committee Secretary

 

APPROVED BY:

 

 

 

                       

Senator Ann O'Connell, Chairman

 

 

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