MINUTES OF THE meeting
of the
ASSEMBLY Committee on Government Affairs
Seventy-Second Session
February 24, 2003
The Committee on Government Affairswas called to order at 9:09 a.m., on Monday, February 24, 2003. Chairman Mark Manendo presided in Room 3143 of the Legislative Building, Carson City, Nevada, and via simultaneous videoconference, in Room 4412 of the Grant Sawyer State Office Building, Las Vegas, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Mr. Mark Manendo, Chairman
Mr. Wendell P. Williams, Vice Chairman
Mr. Kelvin Atkinson
Mr. Chad Christensen
Mr. Tom Collins
Mr. Pete Goicoechea
Mr. Tom Grady
Mr. Joe Hardy
Mr. Ron Knecht
Mrs. Ellen Koivisto
Mr. Bob McCleary
Ms. Peggy Pierce
Ms. Valerie Weber
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
None
STAFF MEMBERS PRESENT:
Susan Scholley, Committee Policy Analyst
Eileen O'Grady, Committee Counsel
Nancy Haywood, Committee Secretary
OTHERS PRESENT:
Roger Mancebo, President, Nevada Association of Counties, Pershing County
Robert Hadfield, Executive Director, Nevada Association of Counties
Andrew Alan List, Policy and Research Analyst, Nevada Association of Counties
Alan H. Glover, Clerk-Recorder, Carson City
Stan Olsen, Lieutenant, Nevada Sheriff’s and Chief’s Association
Ben Graham, Nevada District Attorney’s Association
Jeff Johnson, Nevada Assessors’ Association
Jim Ithurralde, Eureka County Assessor
Dan Musgrove, Director, Office of the County Manager, Las Vegas
Ray Masayko, Mayor, Carson City
Mary Walker, Lobbyist, Carson City, Douglas, and Lyon Counties
John Wagner, President, Burke Consortium of Carson City
Katie Hughes-Appel, Service Employees International Union, Local 1107, Las Vegas
Mark Schofield, Assessor, Clark County
LeRoy Goodman, Lyon County Commissioner
Assembly Bill 66: Increases compensation of certain elected county officers. (BDR 20-170)
Chairman Manendo welcomed all Committee members and guests to the Committee on Government Affairs and called the meeting to order at 9:09 a.m. He welcomed the Las Vegas guests and witnesses to the meeting also. The roll was called, and the Chair directed the secretary to mark Mr. Collins, Mrs. Koivisto, and Mr. Williams present upon their arrival.
The Chairman reviewed today’s agenda for the Committee members noting that there were many people who wished to speak in both Las Vegas and Carson City. There were many who signed in and indicated they wished to testify in opposition to A.B. 66. Chairman Manendo stated that the proponents would speak first, but he would leave adequate time to hear the concerns of the opponents.
For those guests in Carson City and in Las Vegas as well as those visiting on the World Wide Web, Chairman Manendo explained that he and other Committee members had received many e-mails and phone calls in opposition to the bill being considered. More e-mail messages were coming in as he spoke. The Chair stated he believed he had received over 100 separate e-mails on the issue.
Chairman Manendo opened the hearing on A.B. 66 by inviting Mr. Hadfield to come forward. Mr. Hadfield did so and brought with him two additional witnesses.
Roger Mancebo, President, Nevada Association of Counties (NACO), and Chairman of the Pershing County Board of Commissioners, introduced Robert Hadfield and Andrew List who had joined him at the witness table. Mr. Mancebo commented that there was a growing problem in counties across the state as county officers were taking salary decreases to move into positions with greater responsibilities. That was only one example of what was becoming more and more prevalent. His belief was that viable candidates were not interested in running for office as, in their current positions, their salaries were greater than that of the office that was being vacated by its present position holder. Another related concern was that office holders who had stagnant salaries had decided to retire. Because all of the 17 counties were in support of A.B. 66, it was important to note that A.B. 66 was not an unfunded mandate; every county had budgeted for the increases in salaries that were the essence of A.B. 66.
Chairman Manendo asked for clarification. He had understood Mr. Mancebo to say that every county would be able to handle the salary increases for every position. Some members of the Committee had expressed concern about the smaller and less financially secure counties handling the increases at that time.
Mr. Mancebo stated that there was an amendment to the bill for counties experiencing financial difficulty to ask for a reprieve or a waiver from funding the raises. To his knowledge, only one county, Mineral County, had indicated concern and was considering asking for that waiver.
Counties throughout the state had very talented people holding public offices at the county level. They gave up their family lives and worked on weekends to maintain the counties’ stability. A.B. 66 was a fair proposal, he declared; it was a proposal for salary increases thatoffice holders had worked hard for and deserved. As county citizens, he and others would view increases in salaries as incentives for talented people interested in holding office to do the business of county government. NACO, representing county clerks, treasurers, district attorneys, and sheriffs, believed it was time for passage of A.B. 66. It was possible that another increase in salaries would not be considered for six to eight years.
Robert Hadfield, Executive Director of NACO, spent time giving the Committee the background of the bill as cited in his letter to Chairman Manendo (Exhibit C) and reviewed the process that resulted in the language for A.B. 66. The bill was sponsored by NACO to raise elected officials’ salaries and was similar to bills presented each legislative session since 1985. The association and other affiliated groups representing elected officials came together to develop a coalition to prepare A.B. 66 and to lend support for its passage (Exhibit D). At the current time, Article 4, Sections 20 and 32 of the Constitution of the State of Nevada provided that the Legislature establish and regulate the compensation and fees of county officers. In the distant past, each county had a senator whose responsibility it was to decide the salary levels for elected officials for each county. With the court case of Baker v. Carr, that changed. Added to that were the changes in complexity of the state, changes in job descriptions, and the responsibilities of county officials that were decidedly different. A system was currently in place that called for specific classifications of counties. Changes in classification for two counties were contained in A.B. 66. The purpose of the classifications was to determine differences in the salaries for elected officials based on county size, the complexity of each county’s government, and workloads of those governments. NACO had been responsible in the past to administer the classification of counties and to make recommendations to the Legislature for 15 years. Mr. Hadfield had served on several statewide salary committees and commissions, both as an advisor and as a member.
As the Committee members examined the proposed salaries, he urged them to consider that they were based on the relevant workload statistics in individual counties, and that those were used as part of the justification for grouping counties in specific classifications. Population was another consideration. In the past, classifications also took into account the assessed valuation, but, since the mining boom, a very small county could have a huge mine which would increase the assessed valuation but still leave county officials with a relatively small workload. Classifications were relying more and more heavily on specific information gathered about each county and then compared with information from other counties, always looking for comparability. Most recently, because of the disparity between the salaries of appointed county officers and the administrators who were elected county officers, NACO had to look at the general salary structure of the governments themselves. For example, in Clark County, elected officials’ proposed salaries were suggested to bring those salaries into a comparable position to the other appointed department heads in that county. A.B. 66 was not a bill that would bring parity, but it would be an attempt to make salaries mean something in relationship to the workload of the county and the overall salary structure of that county for comparable positions with comparable responsibilities.
In A.B. 66, two counties had been moved from one class to another. Humboldt County was moved up a class because, since the last salary bill eight years ago, that county was more comparable today to counties of a larger size. Storey County was in need of a full-time district attorney, and that required a change in its classification as a county. The process was not an isolated one. A.B. 66 mirrored recommendations made by the Governor’s Salary Task Force (Exhibit E) in preparation for the measure NACO introduced in the 2001 Legislative Session. That task force conducted numerous public hearings throughout the state; the report itself was for legislative salaries, judicial salaries, and county elected officials’ salaries. In the materials provided to Committee members, excerpts from that report were taken for information about the salaries of elected county officials only. NACO changed the process two years ago to determine the annual increases. The salary task force suggested, instead of using the Consumer Price Index (CPI) or some other index to determine raises over a period of years, giving more credence to what was happening to the private citizens in the state. The suggestion was to use the private sector wage and salary survey prepared by the former Department of Employment Security, now known as the Department of Employment, Training, and Rehabilitation. That recommendation was adopted. NACO took those salary increases and used them to calculate the increases in base salaries for nearly all elected officials with the exception of the Humboldt County and Storey County officials who would go up one class.
Clark County officials, at the recommendation of the task force two years ago, and some of Washoe County’s elected officials realized and recognized that when the base salaries were established, those counties were much different than they were currently. They were much smaller, less complex, and did not represent major metropolitan areas, particularly in Clark County. They also recognized that the salary table did not reflect the salaries that were being paid to their fellow appointed department chairs in that same government.
The tables included in A.B. 66 represented a process that was equitable and workable, a process that was developed through input from public hearings, the Governor’s Salary Task Force, and recommendations from counties and private citizens around the state. Those were the same tables used in the proposal made to the Legislature in the 2001 Legislative Session.
Normally, county officials were given raises in less than eight years. As stated by Mr. Mancebo, eight years without a raise was very unusual in the state. Recent history was that raises were given every six years; the anticipated raises during the 2001 Legislative Session were not forthcoming. Because they were not given in the last session, the normally high percentage numbers that were difficult to deal with in a six-year interim became even higher over the eight-year period. Those higher rates, however, did not change what had happened within the government or to the employees in those county governments over that time period. He stated it was time for the Legislature to deal with the reality of “catch up.” Mr. Hadfield stated that unless there was a constitutional amendment change, the Legislature must set the salaries. NACO had, in previous years, suggested that salaries for county officials be changed every two years as the changes would be a simple, comparable thing to do, and the legislators would not be faced with the larger percentages and a great many misunderstandings. Should A.B. 66 pass, the next raises for elected county officials, in all probability, would not happen for another six years. The percentages listed in the bill were not actually representative of the 8 preceding years but were for 14 years, the 8 years past and the 6 years anticipated in the future. That would be one of the most difficult concepts for most to understand, he warned.
On February 6, 2003, continued Mr. Hadfield, a report on the status of Nevada’s counties, including their financial statuses, was given to the Committee on Government Affairs. At that time, the legislators learned that each county was markedly different from another.
Since that report to the Committee, NACO had developed an amendment to A.B. 66 making salaries effective on July 1, 2003, rather than January 6, 2003. The January 6, 2003, date was NACO’s effort to align the new salaries with the beginning of the elected officials’ terms of office. County elected officials who were prepared to speak were present as guests of the Committee, stated Mr. Hadfield. In response to Chairman Manendo’s question about who was running the counties in their absences, Mr. Hadfield replied that the counties were in the care of the Chief Deputies who were paid more and whose salaries were negotiated through collective bargaining. NACO was asking the legislators to pass A.B. 66. Salaries were more out of balance than they had ever been, he reported, and the salaries would be more equitable if the recommendations of the Governor’s Salary Task Force were accepted.
A second amendment was a relief provision. Any county that believed it was unable to implement the new salaries because of financial hardship would have the option of proceeding with an appeals mechanism with the Committee on Local Government Finance whose members were the finance experts that school districts, counties, and cities used. Counties would seek a waiver from the implementation of the new salary schedule, and, with Chairman Manendo’s permission, Mr. List would speak to the proposed amendments so there was a clearer understanding.
Chairman Manendo expressed appreciation for Mr. Hadfield’s testimony and asked for information as to the percentage of raises received by Clark County employees.
Mr. Hadfield did not have the answer, but he would be able to research it and provide it at a later date, he said.
Chairman Manendo pointed out that one of the raises cited in the proposed legislation was an increase in pay of $24,500 to $26,000 for the county commissioners, still part-time positions. The Chairman wished to compare that increase with the salary percentage increases of Clark County employees.
Mr. Hadfield responded to the Chairman by announcing he had just been handed the percentage figures based on the Cost-of-Living (COLA) index, and it had been 6 percent per year.
Assemblyman Williams had several points he wished to make. The position of elected officials who found themselves earning less than some of their subordinates was not so different from the legislators’ position; not one member of the Committee earned more than any state employee in Nevada, regardless of their position in the state. “We understood that as elected officials,” commented Mr. Williams. That was the reality of running for office in Nevada. Fortunately for county officials, not all employees of the counties earned more than the elected officials of that county.
Another concern was the request for more flexibility from the counties, a request heard during the 2001 Legislative Session and during the current session. Mr. Williams believed that NACO needed to ask for flexibility by requesting a constitutional amendment to allow counties to raise their own salaries. Six years were required to amend the Constitution. Currently, it was the Legislature that would raise the salaries and would face the constituents in their home districts. Mr. Williams continued that the Commissioners would be able to say they had not raised their own salaries; the legislators did it. Perhaps an amendment to the Constitution should be sought, or a bill proposed, he suggested, to give the flexibility to the counties to raise their own salaries.
In Clark County, Mr. Williams continued, there was a serious situation with those employees of Clark County working with no contract. Thousands of letters and e-mails had been received from employees that NACO and the Committee members represented. During the 2001 Legislative Session, the bill that Mr. Hadfield had referred to earned a “nay” vote from Mr. Williams, both in the Committee and on the Floor, but he felt better about the bill during the current session. Although he did not agree to the levels of increase or with the percentages presented, he would not be totally opposed to it. County officials and those working in government needed a raise, he stated. The raises, according to Mr. Williams, should happen during the current session if a level could be agreed to.
For those working in Clark County without a contract since July 1, 2002, it would be inconsiderate and arrogant to seriously debate the proposals in Clark County, Mr. Williams continued. He expressed his concern about the seeming inability of Clark County and its workers to reach a contract agreement. Even though the county itself did not officially influence the collectively bargained agreement between the county and its workers, he did believe there was pressure placed on the negotiations process by county officials. He would caution legislators and witnesses alike to go slowly with A.B. 66 as proposed until the Clark County workers had a satisfactory negotiated contract in hand. He hoped that the elected officials would get the raise they deserved during the current session of the Legislature, but he believed that everything possible needed to be done to ensure that the county employees of Clark County, in particular, received a decent salary increase also.
Regarding the issue of flexibility, Mr. Williams pointed out that the Constitution of the State of Nevada had been changed many times. If six years were allotted for changing salaries in the past, the interested parties would certainly be able to last the six years needed for a constitutional change. He urged the proponents of A.B. 66 to move toward gaining the desired flexibility, to continue to budget for the increases, and to get into the position to do what needed to be done. On the face of the current situation in Clark County, when the people who did the work, the employees of Clark County, still had an uncertain future, it seemed appropriate to pursue the amendment as suggested, concluded Mr. Williams.
Chairman Manendo reminded the Committee and guests that the legislative sessions were not long ones. One of his concerns was having several bills in process at the same time. The legislators would hear parts of the bill repeatedly. The timing was to the bill’s disadvantage as the issues in Clark County were extremely serious to the Clark County constituents. Those issues remained unresolved at that time. The Legislature was an open body, willing to debate and hear testimony, but A.B. 66 would not pass out of Committee at that hearing.
Assemblyman Knecht greeted the witnesses and stated he had two or three brief lines of inquiry. He wished to describe his understanding of the figures presented and hoped to be corrected when he erred. At one time, he continued, he understood that there was a 27 to 28 percent increase that had been determined to be appropriate but had subsequently been indexed which increased proposed salaries to the mid-30 percent range. In reference to Mr. Hadfield’s testimony, there were further adjustments for Washoe and Clark counties that gave figures for salary increases that were as high as 55 or 56 percent. Storey and Humboldt counties were also adjusted due to their reclassifications. He wanted the witnesses to confirm or correct his understandings thus far.
Mr. Hadfield confirmed Mr. Knecht’s understanding. Those were the recommendations for what was called rebasing of those salaries or reclassification of those counties that came from the Governor’s Salary Task Force. Excerpts from that report had been included in the information provided to the Committee members. He stated that it was a fair representation of what NACO was proposing.
Mr. Knecht reported that he did have the excerpts from the task force’s report and that he had perused them. His second point was that, like Mr. Williams, the amounts did not seem out of line, but the evidentiary basis to support those numbers was primarily the task force’s report. Mr. Knecht was not completely persuaded, generically, by task force reports. Typically, he said, one would get what one asked for from the task force based on the persons appointed. While he was not taking exception to the figures, the committee process was not as persuasive as a market survey. His questions were whether a true market survey for at least some positions had been done and if there were any indications of what truly comparable compensation levels were for truly comparable positions.
Mr. Hadfield clarified that the advantages of the Governor’s Salary Task Force was the time taken and the frequency of meetings to answer similar questions. Much information was provided. Because of that process, when NACO had anticipated passage of a similar bill during the last legislative session, and in other salary commissions, members had attempted to find comparable states and had also compared western states. They had looked at Arizona closely because of its 15 counties and because it had a similar growth pattern to Nevada. In all cases there was no index that did what they had hoped the salary table would do to relate information to the individual counties. In the larger counties, there would be more comparability because they had other large departments with appointed department heads with salaries based on whatever the market would bear. Typically, those were much higher than the salaries of the elected officials. That information was available. To cross over to the private sector was a difficult step to take; there was little comparability in the private sector to a county clerk-treasurer. While one could compare that to a chief financial officer, there were probably as many arguments against doing that as there were for attempting it. “Most of that ground was tilled during those processes, and we did rely on the recommendations of the committee,” stated Mr. Hadfield. By doing so, NACO’s thought processes were changed as to how to come up with annual increases.
Chairman Manendo apologized to Mr. Knecht for asking him to yield and promised to allow him time later in the meeting. The Chairman was concerned that not all who wished to speak would have that opportunity.
Assemblyman Goicoechea stated that he too concurred with Mr. Williams. He believed that counties needed to set their own salaries and that the issue needed to be taken out of the legislative process. His concern was, however, the response of the citizens should the Clark County contract remain unsettled throughout the length of the legislative session. His thought was that an unsettled contract would lead to an additional two years of non-funding of raises. He believed that was a very real issue. Having served as a commissioner in Eureka County for 16 years, Mr. Goicoechea stated that, from 1995 until the present time, there had been at least a 60 percent increase in the wages of those people working for Eureka County while the elected officials had worked without raises other than for the longevity increases in pay. In rural Nevada there were not as many qualified people per capita as there were in larger, more metropolitan counties. If the long-serving elected officials were not taken care of, candidates in the future would be lost. As it was, many county assessors, clerks, and treasurers ran unopposed. They remained good at their jobs and needed to be paid, but, at some point in the future, their positions would be vacant. Mr. Goicoechea wondered if there would be qualified candidates willing to run for election to those positions.
Assemblyman Grady agreed with some of the comments made by Mr. Williams. He wished to ask Mr. Hadfield about unfunded mandates. He stated that he had worked with Mr. Hadfield for a number of sessions fighting unfunded mandates. He had noted that the Nevada Revised Statutes (NRS)354.599 appeared in A.B. 66 to show it as an unfunded mandate. Mr. Grady asked, for the record, that Mr. Hadfield state that all of the counties understood that the bill was not an unfunded mandate, and that it was a request made by the counties on behalf of all of their elected officials.
Mr. Hadfield affirmed that he was one of the people who worked to place the unfunded mandate issue on the ballot. The vote resulted in 84 percent of the voters approving it. A.B. 66 did not qualify as an unfunded mandate. The bill was requested by the counties to set aside and use county monies in the county budgets administered by county governments. Because of the statute, the reference to NRS 354.599 was added into the bill by the bill drafters. All 17 counties had requested the change in responsibility knowing that it was their responsibility to pay for the raises. It was fully understood that the bill was not an unfunded mandate. The counties would not say that the legislators made that decision without their approval. The counties were asking the legislators to enable the counties to be responsible for themselves.
Mr. Grady stated his lack of comfort with having the Committee on Local Government Finance approve waivers, but he remained unsure as to who else might be called on to do it. One needed to recognize, he suggested, that the Committee on Local Government Finance was normally appointed by NACO, and, lastly, the time limit had been reached for committee introductions. However, Mr. Grady continued, the Chair was able to consider an introduction by starting the process to develop an amendment to give the responsibility for determining salary increases for the elected officials over to the counties. As Mr. Williams stated, it would take six years to do that.
Chairman Manendo reported to Mr. Grady that the process was being looked into at that moment.
Mr. Hadfield reported that Assembly Joint Resolution 1 of the 17th Special Session in 2001 did just what the Chairman had stated he was looking into. He also noted that it contained other provisions that were not favored. It went beyond what the Committee had been talking about which was not the real issue. It allowed elected officials’ offices to be eliminated, which was not supported by NACO.
Chairman Manendo stated that the Committee on Government Affairs would be putting in a request for a separate bill draft specifically designed as an amendment to the Nevada Constitution.
Mr. Hadfield asked that Andrew List be allowed to explain what the amendment was that Committee members had in front of them, an amendment that would be needed in any salary bill.
Mr. List spoke to the Committee about the amendment. NACO had worked with the Legislative Counsel Bureau to develop the language to clarify the waiver provision that was in the original bill. Section 2 of the amendment, as Mr. Hadfield had already explained, changed the effective date of the salary changes from January 6, 2003, to July 1, 2003. Section 3 was the waiver provision itself. Section 3.1 would allow counties to ask the Committee on Local Government Finance for a waiver if the county commissioners believed their funds to be insufficient to grant the salary increases. Section 3.2 explained that a county would be able, if needed, to request a second waiver for a second year if their finances remained insufficient for implementation of the salary increases. Counties would be able to ask for an unlimited number of waivers. Some counties were possibly heading for a financial crisis or were in the midst of one at the present time. Mineral County was a good example. They had communicated to NACO that they would likely ask for waivers for two consecutive years. Section 3.3 explained that, once a county had granted the salary increases, they would not be allowed to return to the previous salary schedule. Mr. List clarified that once salaries were granted, they were locked in from that point forward. Section 3.4 clarified the provision of the retroactivity of the wages. If a county were to request a waiver, then granted the salaries in the next year, they would not be required to pay the salaries retroactively for the period during which the waiver was applicable. Finally, as Mr. Grady mentioned, Section 4 was the unfunded mandate provision, but NACO did not agree that the proposal was an unfunded mandate. Section 5 also confirmed the effective date for salary increases as July 1, 2003. NACO believed the waiver provision would work for their member counties and would help those counties who remained unable to grant the increases. It would also protect them from penalties that would require them to pay salaries retroactively once they were out of their financial crises.
Assemblyman Hardy heard Mr. List confirm that some counties were headed for financial problems. If those counties did not apply for a waiver during the first year of eligibility, they would be locked into the new salary schedule. If those financial crises should come to pass, the counties would need to construct a plan to deal with that situation. Mr. Hardy asked if there had been consideration given to that scenario.
Mr. List restated his testimony regarding financial crises. He wished to clarify that his previous testimony referencing “heading for” would have been more clearly stated if he had said, “right around the corner.” He was not referring to fiscal years in the future such as 2006 or 2007. Some of the counties would have more immediate difficulties, he said.
Mr. Hardy stated his understanding that more counties than Mineral County would need to ask for a waiver should A.B. 66 pass.
Mr. List understood that other counties were looking at their financial situations and were considering asking for a waiver should the legislation pass. None of the counties, however, had confirmed that. There had simply been some discussion.
Mr. Hardy speculated that the way in which a county would decide to ask for a waiver would be an affirmative vote by the county’s commissioners to ask for the waiver.
Mr. List affirmed that that was correct.
Mr. Hardy further stated that the counties decided what they wanted to do and how they wanted to do it, not the state.
Mr. List stated that Mr. Hardy’s statement was partially correct. Because they would still need the waiver, they would share the responsibility with the Committee for Local Government Finance. Section 3.1 in the amendment stated that the Committee for Local Government Finance needed to find the financial resources of the county insufficient to pay the increases in salaries. It was up to that committee to grant the waiver. No county by itself would be able to declare that they were without funds and would, therefore, receive the waiver and not increase salaries. It was a shared responsibility; the county needed to apply for the waiver, and the waiver needed to be validated by the committee in the process.
Assemblyman Hardy asked if there were guidelines in each county or with the body that would grant the waiver that would allow for a reserve to be applied so that counties would need a specified reserve and cash flow and would be required to have a certain amount to meet their reserve capability.
Mr. Hadfield chose to respond. The State of Nevada Budget Guidelines made it very clear as to what counties would be able and would not able to set aside money for a reserve. There were contingency funds, and there was a reserve fund to allow for one month’s payment. The Committee on Local Government Finance was selected as the initial waiver-submission group. Members of that committee were experts in finance and, for that reason, since they had similar responsibilities, they would be able to work with the Department of Taxation. If a county were in financial crisis, they would contact the Department of Taxation to trigger a relief mechanism through them. Controls existed and guidelines were in place as to how the counties would administer those funds.
Mr. Hardy again asked for clarification as to what triggered the waiver. His understanding was that the waiver request was actually triggered by the county, and, therefore, the state that had a concern about the financial health of a county would be “out of the loop.” The county maintained the responsibility, not the state.
Mr. Hadfield reassured Mr. Hardy that the county triggered the waiver request mechanism, and the state remained uninvolved. The counties were currently in the process of completing their budgets for the upcoming year. At the conclusion of that process, they would determine if the relief mechanism would be appropriate to trigger should the bill be passed.
Assemblyman Christensen asked why the bill was not passed in 2001. He was not an assemblyman at that time and requested the history of the bill asking if the bill had been presented in the same way minus 6 percent in the numbers.
Mr. Hadfield stated that the bill from the 2001 Legislative Session was A.B. 256 of the 71st Session. That bill, presented to the Committee on Government Affairs, later became A.B. 606 of the 71st Session as a part of a general pay-raise bill for judges, legislators, and county elected officials. It was A.B. 606 of the 71st Session that was not passed. The provisions in the current bill, the Clark County provisions, and all else, remained the same with one exception; the private sector wage increase was used to determine those increases in A.B. 66. The private sector had no current report, so NACO researched the wage increases and examined the 20-year average of the private sector wage increases; they also considered the 15-year average, the 10-year average, and the 5-year average. The five-year average was selected because it was the lowest of all. Using that information, NACO extrapolated from that to arrive at the 7.41 percent difference from last session’s bill. The salaries listed in the bill were adjusted up 7.41 percent for the two-year time frame.
Mr. Christensen asked Mr. Hadfield to explain why A.B. 606 of the 71st Session had not passed.
Chairman Manendo encouraged Mr. Hadfield to respond.
Mr. Hadfield simply stated that things became very confused during the last half hour of the Floor session in the 2001 Session. “We ran out of time.” An amendment was needed that had not been anticipated after the Senate heard the bill. The amending process caused the bill to get to the Floor later than preferred. “We just ran out of time.”
Chairman Manendo complimented Mr. Hadfield for his simple and forthright explanation and recognized Mr. Knecht who had questions on the amendment.
Assemblyman Knecht stated that he was a proponent of “home rule” and wished he were able to give counties complete freedom in determining salaries of elected officials. He suggested the possibility of a bill with a permissive cap that would allow the counties and cities to pay up to a certain level. He stated that the staff legislative counsel had explained to him that the constitutional provision stated that the Legislature “shall fix” the salaries. In reference to that, he asked Mr. List if an opinion had been received from either the Legislative Counsel Bureau (LCB) or from anyone else legally qualified to render an opinion that the committee procedure proposed to handle the waiver would be consistent with the Legislature’s duty “to fix” those salaries.
Mr. List stated that the requirement “to fix” salaries was the requirement expressed in the bill; it was the Table included. The committee process used fixed those salaries in the Table. If the committee process were to be used in the future, that committee would fix the salaries. Also, the amendment was processed through Ms. O’Grady, Counsel to the Committee on Government Affairs. Mr. List confirmed his belief that it met the requirements as existed in the Nevada Constitution.
Mr. Hadfield recalled that there was a similar provision in the bill during the previous session. At that time, NACO assumed the constitutionality of that bill and of the bill now as drafted. He reminded Committee members that the bill last session was passed by both Houses, and there was no challenge to its constitutionality.
Mr. Hadfield requested permission from the Chairman to make a final statement. NACO remained sensitive to the situation between Clark County employees and management, he confirmed. He was aware that there were ongoing discussions, but he was not privileged to have more information. He stated it certainly would be in everyone’s best interest if the contract were settled soon. However, he did not know where the negotiations process currently stood. His concern was that the Committee and the Legislature had time constraints, and the collective bargaining process did not. It was his hope that some agreement or accord or understanding would be reached to satisfy Mr. Williams’ concerns that would allow the bill to be moved from the Assembly, to the Senate, and then back to the Floor of the Assembly in a timely manner.
Chairman Manendo reported that he did not know the current status of negotiations in Clark County either. He reiterated that he was extremely concerned that the citizens in Clark County would object strongly to salary increases for any county officials when their own futures were so unclear. Their elected representatives must listen. It was the job of the legislators to do so which would explain the many concerns expressed within the Committee.
Assemblyman Collins reaffirmed that, given the 120-day session, a simple bill such as A.B. 66 need not take a great deal of time. He felt the bill was not only simple but also overdue. He wanted to clarify that the Legislature created the counties, and, therefore, the legislators had the jurisdiction over the salaries of the counties’ commissioners. He believed the legislators should maintain that control. He reasoned that county commissioners had recently raised salaries in Clark County for certain administrators; for example, the Las Vegas Convention Authority was raised $230,000 to $250,000, and the Airport Authority made a fortune. The county commissioners decided those salaries. He restated that the Legislature set the commissioners’ salaries and that should continue. His suggestion was, out of expediency, to delete the Clark County Commission from the bill and pass the remainder as it was. “That’s the short of it.”
Chairman Manendo, in response to the unrecognized motion and second heard in the background to adopt Mr. Collins’ motion, educated the public that no formal motion was made as none had been called for by the Chairman. He then asked Mr. Hadfield if there was an agenda for testimony to follow.
Mr. Hadfield assured the Chair that only one member from each group would make a presentation, and each would be brief.
Alan Glover, Clerk-Recorder of Carson City, was testifying on behalf of the County Fiscal Officers Association (CFOA) made up of all elected officials except the district attorneys, the sheriffs, and the assessors. There was a separate association made up of county clerks and election officials. He commented that Mary Milligan, president of CFOA, was also present in the audience if the Committee members had questions he was not able to answer. The association had made an effort to encourage as many of the elected officials to be present at that hearing as was possible, to give names and faces to the positions under discussion. He commented that just as other employees in the counties, they had needs also; categories, salaries, and figures were not really the issue, people were. Those officials present felt a little uncomfortable, continued Mr. Glover, as they felt caught between the county commissioners and the other elected officials. The clerks, the recorders, the treasurers, the auditors, the sheriffs, and the district attorneys were career employees of the counties. The difference between them and the fiscal officers whom Mr. Glover represented was that the fiscal officers worked directly for the voters; the voters hired or fired them. They did not work for the county manager. The legislative body had struggled over the years with the salaries of county commissioners who, like themselves, were part of the Legislative Branch of government. The fiscal officers were most often referred to as part of the Executive Branch. Mr. Glover strongly stated his hope that due consideration would be given A.B. 66. He reminded the Committee again that elected county officials had been without a pay increase for eight years. He reported, as had Mr. Hadfield, that the bill needed to be dealt with in a timely manner as there was no desire to be in the position they found themselves in two years ago when the bill was delayed and time ran out. He requested favorable consideration of the bill and a positive effort by the Committee to move the bill forward.
Lieutenant Stan Olsen of the Nevada Sheriff’s and Chief’s Association spoke in support of the bill and the amendments. The amendments, he stated, did two things in the bill. They helped create enabling legislation, rather than mandating legislation, and the county commissioners made the decisions as to whether to activate the pay increases or not based on the counties’ financial situation.
Ben Graham, Legislative Representative for the Nevada District Attorney’s Association, agreed with Lieutenant Olsen but believed that the counties would be able to stop the process rather than start it. In previous hearings, Mr. Graham reminded the Committee members, he had spoken to them about the district attorneys and the sheriffs. He was hearing no discussion amongst legislators about their exceedingly poor pay. It amazed him, he declared, that anyone of quality would run for legislative office and was more surprised when he/she ran a second time because of the abysmal salary paid to legislators. That was not, unfortunately, an issue on the table currently. Mr. Graham urged passage of A.B. 66, although he too wished there was a contract settlement in Clark County. He spoke about Clark County workers who had had no contract since July 2002, and wondered what it must be like for those certain elected county officials to work essentially without a viable contract based on current salary estimates since 1997 or 1998. As Mr. Hadfield said, and Mr. Graham agreed, that over a 20-year period those people had received just two pay raises. Even though many in the audience put faces to the names and offices for which the bill was written, care must be taken to direct attention to the positions and not to specific individuals. Mr. Graham had heard many times over about the sacrifices made by those currently in office. Sooner or later, he proclaimed, a raise must be granted to continue to entice qualified candidates standing for election.
Chairman Manendo appreciated Mr. Graham’s sympathy as to the plight of the legislators and their salaries. Even though the Legislature was limited to 120 days, much of the legislators’ work for their constituents was done between sessions on a daily basis after they had returned home. For that, there was no compensation. It was done because legislators wanted to serve their public.
Mr. Collins agreed with prior testimony that collective bargaining took time. He had participated in collective bargaining when the process was at a standstill, and there was no noticeable possibility of compromise or no means by which a holiday could be traded for a personal birthday. Suddenly, he stated, when the need arose, the contract was settled. Mr. Collins continued by adding to previous comments about raises for the legislators. The last one received was in 1995 with a $16 increase from $114 to $130 per day, and the daily rate of pay stopped after 60 days, regardless of how long the Legislature was in session. That certainly was not part of A.B. 66. He simply wished to reaffirm that miracles happened in the collective bargaining process and that those about whom the bill was written deserved a raise.
Chairman Manendo stated his belief that the “raise” was not a salary raise in 1997, but was a “per diem” increase.
Mr. Atkinson had chosen to remain silent until Mr. Graham spoke. He declared that he was in a difficult situation as he was an employee of Clark County. Mr. Atkinson strongly agreed with Assemblyman Williams. He did not feel comfortable discussing salary increases for individual elected officials when there were 18,000 employees in Clark County who wished for a better quality of life for their families just as the elected officials desired. The cost of living adjustment (COLA) was definitely a means by which partial raises were granted, but the reality was that some workers had reached the top of the salary range and the COLA was all that they received. He believed that all elected officials deserved a raise. When he was informed that his salary was $7800, he jokingly said he thought that was per month. When he arrived in Carson City, he continued, he quickly realized that was not the case when he received his first check. At the same time, he agreed in pay raises for all. There were workers, however, in Clark County, and probably in all other counties, who worked very hard to make the county commissioners look very good to the public. He did not agree that passage of the bill, in light of the stalemate in Clark County, would be justified at that time.
Chairman Manendo reviewed the agenda and asked if there were others who chose to speak in favor of A.B. 66.
Jeff Johnson, Humboldt County Assessor and president of the Nevada Assessors’ Association, spoke on behalf of that association to support the bill despite having had no input into salary figures (Exhibit F). Because those “certain county elected officials,” identified in A.B. 66, had gone eight years with no pay increase and had employees whom they supervised earning more than they themselves earned, he was in favor of passage. He agreed that county workers in all counties, not just those in Clark County, worked hard and helped their superiors “look good.” Speaking for the Assessors’ Association, he thanked the legislators for their time and for listening to the concerns of so many.
Jim Ithurralde, Eureka County Assessor, had been in the Assessor’s Office for 27 years, 16 of those years with Assemblyman Goicoechea as the Chairman of the Eureka County Commissioners. Mr. Ithurralde stated he had had the honor of running unopposed for his office for seven terms. Either he had done a very good job, he stated, or no one else wanted the job, or the position did not pay enough. He believed it was a great job as there were always changes and challenges to look forward to, and it was never boring. When elected to office in 1978, the assessed valuation in Eureka County was $9.8 million; today the roll had over $300 million in exemptions alone. The starting salary in 1978 was $10,100. He took a $5000 per year cut in pay to take the office. In the past, the legislators had given raises to elected county officials every six years. Now, however, eight years had passed. He believed that the elected officials were hardworking, professional, conscientious workers and deserved the salary increases in A.B. 66. He referenced a flow chart of salary increases for some of the department heads over 16 years, from 1987 to 2003. Some had received 142.83 percent salary increases despite the conservatism of Mr. Goicoechea. Some of the older employees had received 152.21 percent increase in salaries over that time span. Newer employees received increases of 108.54 percent. The elected officials in that time span had just a 79 percent increase in salaries. Certainly that was a noticeable inequity.
Chairman Manendo invited Dan Musgrove, Director, Office of the County Manager, Las Vegas, forward to give testimony. Mr. Musgrove believed he needed to clarify some of the issues brought forward by others regarding Clark County. He spoke of the status of negotiations in Clark County. The county and the University Medical Center (UMC) positions-in-general unit had collective bargaining agreements that expired July 1, 2002. During the past year, the county had been negotiating with the Service Employees International Union (SEIU) over successor agreements. There were two issues that remained unresolved between them: The first was the cost-of-living adjustments (COLAs), and the second was subcontracting. The county had offered SEIU, county workers, and employees of the University Medical Center a 4 year contract with a 2 percent COLA per year. The physicians at UMC had not been offered a COLA. The SEIU had proposed COLAs of 3.87 percent for county workers and 2 percent COLAs every six months for workers at the UMC for each year of the proposed contract. Each 1 percent increase in salary, according to Mr. Musgrove, would cost the county about $3.7 million, about 2/3 of which was the General Fund. Of greater concern, he reported, was that a 1 percent increase at UMC would cost about $2.5 million and the hospital did not have the financial capability at that time to fund an increase of any amount. Because of that, the county’s General Fund would be fiscally impacted by an increase of 1 percent and that would require that the amount taken from the General Fund would range from $2.4 million to close to $5 million. Contrast that, he stated, with the union’s proposal of a 4 percent COLA increase and one would easily see that the impact on the General Fund would be approximately $20 million. Beyond the COLA, the majority of the county and UMC employees would be eligible for annual merit pay increases of 4 percent at the county level and up to 6 percent at UMC. Mr. Musgrove stated that merit pay increases effectively raised employee salaries annually to close to 7 percent. Since 1997, if one were to go back that far, the average increases in employee pay had exceeded 7 percent. The negotiations, unfortunately, were being held at a time when the county was funding two significant unanticipated expenses: One was the $30 million for the regional justice center, and the second was to cover the $38 million ongoing operational losses at UMC. Since July 2002, the ongoing operational losses at UMC averaged $3 million per month. The county expected to subsidize UMC over the next year for $13 million to $18 million.
Mr. Musgrove stated that if the COLAs requested better matched those granted other local employees in southern Nevada, the proposals would be more fair and more reflective of the current financial situation. He reminded the Committee members that the state was offering its employees 0 percent COLAs for the coming year while it was offering teachers a 2 percent COLA increase. Clark County, he continued, believed it had the same circumstances as did the state and that it needed to reflect the same fiduciary responsibility to the citizens of Clark County. Clark County would attempt to maintain their losses but also would offer a fair and just raise of 2 percent.
Clark County’s offer had been on the table since January 8, 2003, at which time the county manager sent a letter to the SEIU Executive Director asking for third party fact-finding. There had been no response. Mr. Musgrove declared his belief that negotiations were at an impasse.
Assemblywoman Koivisto pursued issues regarding the University Medical Center. She was concerned that doctors had been laid off from the UMC Quick Cares facilities, thus creating a burden on the other emergency rooms in the county. She personally knew of two people who had spent many hours last week, she stated, in emergency rooms because the Quick Cares facility they had gone to closed and sent them to another emergency facility. She was extremely concerned about constituent reaction to a 49 percent increase in the salary of the county commissioners, a 55 percent increase in the salary of the district attorney, a 59.8 percent increase in the salary of the sheriff, and a 60 percent increase across-the-board increase for the remaining elected officials. She asked Mr. Musgrove to provide a response to her dilemma.
Mr. Musgrove stated again that the Legislature had been confronting the issue of elected officials not receiving just compensation for their duties in much the same way as Clark County was struggling with their inability to give just compensation to its employees. Cutting losses at UMC was one of the ways in which the county was attempting to maintain its solvency. The county had identified two Quick Cares that had a low volume in clients and closed those facilities. Other Quick Cares remained available for Clark County citizens. Additionally, he pointed out, there were many private Quick Cares available. A committee had met in the interim that looked at who would be responsible for providing Quick Cares facilities in the county. One of its observations was that there were many private entities willing to serve the medical needs of people in the county. A Citizens’ Committee had been created to study the role of the UMC, as it remained unclear at the present time. In addition to closing the two Quick Cares, the county addressed the losses and moved to shift employees when possible and to lay off employees when needed. The layoffs had occurred “from the top down,” affirmed Mr. Musgrove, in an effort to disrupt services to clients as little as possible. At the present time, he stated, two studies were underway to determine how to help the UMC be more effective in the community and more cost-efficient.
Assemblywoman Koivisto believed that it was extremely inappropriate to tell a sick person, after spending 6½ hours waiting, that he/she would need to go to an emergency room at St. Rose because the Quick Care was closing. That same sick person then heard, at St. Rose, that they were very busy and had a marked increase in patient loads since the closure of the nearby Quick Care. Again, she asked for advice on what to tell people who called with those kinds of issues. She was not comfortable, she stated, telling those constituents that the closures were part of a budget plan in Clark County after they became aware of the kinds of raises under discussion in A.B. 66.
Chairman Manendo requested that Mr. Musgrove remain at the witness table for a short period of time and noted that the Committee was limited to only one half hour more of testimony.
Mayor Ray Masayko of Carson City addressed the Committee on behalf of the Nevada Association of Counties (NACO) where he served as president in 2001. Carson City, he affirmed, still organized itself and acted like a county. For the record, not a single city in Nevada had come forward asking for raises for its workers because those authorities knew those powers were embedded in their charters. While not minimizing or diminishing the issues occurring in Clark County, there existed 16 other counties in the state, each with its own unique issues and circumstances. NACO was present to reaffirm that there were professionals in those elected positions; those positions were their livelihoods. He realized, he stated, that one could state that those elected officials knew what the jobs paid when they chose to run for office; but after running and being placed in the job and recognizing what would be required, it was fair to ask for just compensation. As a member of the Board of Supervisors of Carson City, in a public meeting, the Board stood up in support of the NACO bill, and publicly stated that they knew that the Legislature had to increase the salaries. It was with the Board’s support that the bill came before the Legislature. Mayor Masayko assured the Committee that the Board of Supervisors of Carson City would never say to its constituency, “Gee, the Legislature made us do it.” That was accountability, stated the Mayor, and elected officials as part of the Executive Branch of government had to accept that responsibility. Unfortunately, the state’s Constitution required that the Legislature remain in charge of setting salaries. The Legislature’s efforts to decouple that issue from the Legislature and return it to the counties earned the Mayor’s full support two years ago and still had his full support. It would be the correct action to take; it was the right thing to do for those people who engaged in those livelihoods.
Chairman Manendo addressed the witness who had come forward who identified himself as LeRoy Goodman, Lyon County Commissioner. The Chair pointed out to Mr. Goodman that, while he had signed in, he had not indicated that he wished to speak. Because of that, he would need to wait until those who had so indicated were heard. Mr. Goodman returned to his seat.
Mary Walker, speaking on behalf of Lyon County, Douglas County, and Carson City County, confirmed that those three counties had approved that pay bill, had budgeted for it, and wholeheartedly supported it.
Assemblyman Atkinson addressed Mr. Musgrove and asked him to recall his statement that employees received both a merit raise and a COLA increase in salaries. He wanted to know what percentage of employees, particularly those who had topped out or reached the maximum level of pay in their current positions, did not receive merit pay increases.
Mr. Musgrove stated that the county’s records indicated that it would be close to 25 percent of the total number of employees as they had reached the top of their job categories.
Mr. Atkinson clarified that merit pay was based on performance, attendance, and other activities; COLA was strictly a “cost-of-living” adjustment. He saw them as two separate issues.
Chairman Manendo turned to the opposition to allow their testimony.
John Wagner, president of the Burke Consortium of Carson City, stated that he was wavering in his opposition to A.B. 66 after hearing the suggestions voiced by Mr. Williams. He believed that legislative salaries definitely needed to be increased. His position was that elected officials needed more flexibility. Carson City was in a financial “crunch” having lost one top revenue resource and in the process of losing a second one. He wondered if part of the raises could be given in the current year and the remainder next year when the Legislature was not in session. He did agree that elected officials needed a raise but wanted local officials to have more say in the implementation of the plan. The percentage for Carson City’s elected officials, he stated, would average out to 36.4 percent for each one. He again stated that he was wavering between being a proponent and an opponent of the bill.
In Las Vegas, Katie Hughes-Appel came forward to testify against A.B. 66. She identified herself as a Clark County employee, voter, and member of Service Employees International Union, Local 1107 (SEIU). As the Committee considered A.B. 66, she hoped that they would remain aware that the salaries of many elected county officials would be raised by over 50 percent (Exhibit G). In contrast, the COLAs over the past four years for county employees averaged approximately 3.4 percent, not the 6 percent stated by the county lobbyist earlier. Over the past six months, services in Clark County had been cut. Some of the Quick Cares had been closed, and citizens waited in longer lines because of a hiring freeze. Citizens were also facing significant tax increases. As a Clark County employee, she had witnessed the county’s growth at a record pace. With the hiring freeze on, the county’s employees needed to work harder and harder. As the elected leaders of the community, those officials needed to “tighten their belts just like the residents of Clark County were being asked to do.” Ms. Hughes-Appel urged the legislators to be financially responsible by rejecting excessive raises for county officials. The Union would support Assemblyman Collins’ suggestion, she stated.
Assemblyman Collins asked the witnesses in Las Vegas to consider that the County Commission issued business licenses, building permits, zoning provisions, and so forth that allowed employers to bring people and create work in Clark County but sometimes did not provide health insurance. He asked whether the workers of Clark County bore the burden of the decisions made by Clark County when contractors were selected who were not able to build that regional justice center under budget and on time; he asked if the workers were burdened by the operational decisions, which created the budget deficits of the hospital.
Ms. Hughes-Appel answered in the affirmative but quickly acknowledged that she had misunderstood the question and wished to change her response to a negative one if Assemblyman Collins would repeat the question.
Assemblyman Collins restated the question to ask if the employees of Clark County should bear the burden of the decisions made by the commissioners when the commissioners approved businesses and employers to come into the community who sometimes did not provide insurance for their workers, which would be one of the factors creating debt at the hospital. He also asked if the witnesses believed that the county employees were directly responsible for the choice of contractors for that regional justice center.
Ms. Hughes-Appel stated that the employees should not have to bear that burden at all.
Chairman Manendo stated that Mr. Collins had asked “a leading question.” The Chair also inquired whether there were still others in Las Vegas who wished to testify but was told that Ms. Hughes-Appel had spoken on the others’ behalf. Chairman Manendo then invited others to come forward as there was still time to take testimony.
Mark Schofield, Clark County Assessor, came forward. He was not speaking in opposition but wished to speak to A.B. 66. He stated that, while he empathized with his union brethren having come up through the ranks, it bore reiterating that the administrative elected officials who do not set policy, had nothing to do with their contract negotiations. He thought that the merits of percentages could be argued again and again and that salary increases could be calculated in several different ways, but he wished to revisit how the current situation had evolved. If A.B. 66 were to pass in its current form, the administrative elected officials, the assessor, the recorder, the public administrator, the county clerk, who held full-time positions that were administrative in nature and who were extremely dedicated public servants, would remain far behind those appointed officials who had similar or less responsibility. It was unfortunate that the proposed wages had been coupled with unsatisfactory collective bargaining outcomes. He hoped that the negotiations in Clark County were brought to closure quickly so that A.B. 66 would be able to be clearly heard and passed out of both Houses before it was caught up in the quagmire of the tax discussions that the legislators were about to begin. Mr. Schofield reminded the Committee members that the Assembly had passed a similar bill in the last legislative session. Because the legislators were caught up in the issues of reapportionment and other issues in the Senate, the bill was not passed in a timely manner. Those who heard the eloquent testimony of Senator Raggio in Senate Government Affairs knew that the Senate, too, favored the bill.
Chairman Manendo stated that the beauty of the Legislature was that each session brought new members, the Senate remained the Senate, and the Assembly was the “People’s House.” Members of the Assembly made up their own minds in their own House.
Chairman Manendo asked those gathered in Las Vegas to raise their hands if they were opposed to A.B. 66. He noted that nearly all hands were raised. He then asked for a show of hands by those in favor. No hands were raised. The Chair thanked the guests in Las Vegas for their patience and their participation in the legislative process.
Mr. Goodman returned to the stand and identified himself again as a Lyon County Commissioner. He said that there was a need to look at the local officials and to consider the responsibilities they had to shoulder throughout their careers. He believed that those elected officials deserved to be paid. He stated he came from the private sector where he worked full time. In the private sector, he continued, when people did their jobs and assumed their responsibilities, they were paid for it. The county officials should be treated the same; they needed to be compensated for what they did. In the smaller counties, especially, their expertise was needed to be certain that the counties functioned.
As no more guests indicated a desire to speak, Chairman Manendo closed the hearing on A.B. 66 and adjourned the meeting at 10:45 a.m.
RESPECTFULLY SUBMITTED:
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Nancy Haywood
Committee Secretary
APPROVED BY:
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Assemblyman Mark Manendo, Chairman
DATE:____________________________________