MINUTES OF THE
SENATE Committee on Commerce and Labor
Seventy-second Session
March 25, 2003
The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 7:00 a.m., on Tuesday, March 25, 2003, in Room 2135 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 Randolph J. Townsend, Chairman
Senator Warren B. Hardy II, Vice Chairman
Senator Ann O'Connell
Senator Raymond C. Shaffer
Senator Joseph Neal
Senator Michael Schneider
Senator Maggie Carlton
GUEST LEGISLATORS PRESENT:
Senator Raymond D. Rawson, Clark County Senatorial District No. 6
STAFF MEMBERS PRESENT:
Scott Young, Committee Policy Analyst
Courtney Wise, Committee Policy Analyst
Kevin Powers, Committee Counsel
Laura Adler, Committee Secretary
Lynn Hendricks, Committee Secretary
OTHERS PRESENT:
Robert A. Ostrovsky, Lobbyist, Employers Insurance Company of Nevada
Ann W. Nelson, Lobbyist, Employers Insurance Company of Nevada
Alice A. Molasky-Arman, Commissioner, Division of Insurance, Department of Business and Industry
Roger Bremner, Administrator, Division of Industrial Relations, Department of Business and Industry
Keith L. Lee, Lobbyist, Responsible Mortgage Lenders Coalition
Cheryl Blomstrom, Lobbyist, Nevada Consumer Finance Association
James L. Wadhams, Lobbyist, Mortgage Bankers Association of Nevada
John M. Vergiels, Lobbyist, Nevada Association of Mortgage Brokers
Leo A. Davenport, President, Nevada Association of Mortgage Brokers
Michael Radde, President-elect, Nevada Association of Mortgage Brokers
Pat Coward, Lobbyist, Nevada Land Title Association
Jack H. Kim, Lobbyist, Sierra Health Services, Incorporated
Lawrence P. Matheis, Lobbyist, Nevada State Medical Association
Nancyann Leeder, Nevada Attorney for Injured Workers, Department of Business and Industry
Ronald P. Dreher, Lobbyist, Peace Officers Research Association of Nevada
Wayne Carlson, Lobbyist, Public Agency Compensation Trust
Chairman Townsend:
We will open the hearing on Senate Bill (S.B.) 319.
SENATE BILL 319: Makes various changes to provisions regulating insurance. (BDR 57-599)
Robert A. Ostrovsky, Lobbyist, Employers Insurance Company of Nevada (EICON):
This bill was drafted on behalf of the insurance commissioner's office. We have one amendment. Section 1 should have been directed to the Department of Administration rather than the commissioner of insurance.
Ann W. Nelson, Lobbyist, Employers Insurance Company of Nevada (EICON):
We would like to delete section 1 completely. The intent was to have administrative appeals heard in Reno and Las Vegas rather than Carson City and Las Vegas. We did not intend to tell the commissioner where to hold her hearings.
Chairman Townsend:
Are the commissioner’s hearings videoconferenced?
Alice A. Molasky-Arman, Commissioner, Division of Insurance, Department of Business and Industry:
We have videoconferencing capabilities between Carson City and Las Vegas. All regulation and rate hearings are videoconferenced. In adversarial hearings, it depends on where the parties are located. We do not make people travel but rather hold hearings where it is convenient for the claimant.
Ms. Nelson:
We have further amendments to offer (Exhibit C). Section 1 requires the hearings officers and appeals officers to hold hearings in Reno and Las Vegas rather than Carson City and Las Vegas. There are no insurance carriers currently located in Carson City, and Reno is a greater center of population.
Chairman Townsend:
Is the person in charge of hearings and appeals aware of the problem?
Ms. Nelson:
We have notified him but have had no response.
Kevin Powers, Committee Counsel:
On that proposed amendment, can I have Ms. Nelson testify as to whether they want it only at Reno and Las Vegas, or do they want the opportunity for the hearing officer to have certain hearings conducted at a place other than Reno or Las Vegas?
Ms. Nelson:
We want them held where the injured worker is located. They are currently conducted only in Carson City and Las Vegas.
Senator Hardy:
I suggest we include language such as, “or at any other place of convenience to the parties and witnesses.”
Ms. Nelson:
That would be acceptable. Section 2 removes the requirement that insurance policies issued to nonresidents be countersigned by a resident insurance agent. This current requirement of Nevada law is the subject of ongoing federal litigation.
Ms. Molasky-Arman:
I have concerns about section 2. In this context, a “person” could be a corporation or partnership. Many Nevada businesses have their headquarters out of the State. The countersignature is a safeguard for the allocation of premium taxes. If the countersignature requirement is removed, premiums on properties in Nevada issued by entities outside the State might not be allocated properly.
Chairman Townsend:
Could you give us some details on the federal litigation?
Ms. Nelson:
The litigation claims the requirement is a restraint of trade in violation of the Interstate Commerce Act. A resident agent who countersigns an out-of-state policy receives a commission of 5 percent of the premium. This is reported to Nevada for payment of premium tax. The litigation claims this is a restraint of trade because it adds additional requirements and higher expenses for people outside the State.
Chairman Townsend:
Was the litigation filed in Nevada?
Ms. Nelson:
Yes, in the U.S. District Court, District of Nevada. I will get you a copy of the litigation, but EICON is not a party to it.
Senator Carlton:
Could you explain how this affects the general public?
Ms. Nelson:
Under current Nevada law, if an insurance policy is issued to someone from out of the State, the policy must be countersigned by a Nevada resident agent, an insurance agent licensed in Nevada. That agent does not have to have any affiliation with the company or the insured. For providing this service, the agent receives 5 percent of the premium.
Senator Carlton:
We developed the Nevada resident agents so companies doing business here would have a representative here. If you eliminate this, would that eliminate the representation of that person being in the State and being held accountable for the policy here?
Ms. Nelson:
In my opinion, no. The insurance company must be licensed in Nevada. There is still a nexus with the State through the company, even without the resident agent. It should be noted that the term “resident agent” has a different meaning in the insurance code than it has in general corporate law. A resident insurance agent is not a legal representative of a corporation.
Ms. Molasky-Arman:
The action is against me. It is brought by the Council of Insurance Agents and Brokers. They have a similar suit in Florida. Nevada’s deputy attorney general has submitted a motion for summary judgment claiming the Council of Insurance Agents and Brokers has no standing to bring the action.
Ms. Nelson:
Sections 3 and 4 deal with membership in guaranty associations. The regulations require one member of these associations be an officer or director of a domestic insurance company. There is no requirement for one of these to be from a Nevada-based insurer. Assessments for insolvent insurers are rising in Nevada and nationally. Our assessment in 2002 was $2.5 million.
Ms. Molasky-Arman:
Currently the board is made up of three officers of domestic insurance companies, two officers of major insurers, two people with experience in adjusting insurance claims appointed by various insurance companies, and one insurance agent. The board reviews claims and has a claims committee.
Senator Neal:
Are you asking for one person in each section of the bill?
Ms. Nelson:
Section 3 deals with guaranty associations for life and health policies, and section 4 deals with those for property and casualty policies. They might overlap, but not necessarily.
Ms. Molasky-Arman:
All board members are designated by insurance companies. Section 3 could create an impossibility. We have only one domestic life and health company, and it does not write life insurance. I would like to have some alternatives in case there is no one willing to serve in that one company. I do not want anyone serving reluctantly. Inserting the words “if practicable” to these sections would allow me to deal with the situation.
Mr. Powers:
Ms. Nelson, you mentioned that this would allow an officer or director of one of the domestic insurers to serve on the board. The language only specifies an officer now. Are you looking to add “director” to the language?
Ms. Nelson:
No. The language should be, “an officer of the corporation.”
Senator Neal:
How does this affect the general public?
Ms. Molasky-Arman:
The guaranty associations process and pay insurance claims of people insured by insolvent companies.
Senator Neal:
Could there be a situation where someone on the board is making decisions about their own company?
Ms. Molasky-Arman:
No. Insolvent companies are not eligible for membership on the board of these associations.
Senator Neal:
If a company of someone on the board becomes insolvent, is there a procedure for removal?
Ms. Molasky-Arman:
Yes.
Senator O'Connell:
Could you further explain your concern?
Ms. Nelson:
One of the duties of the board is to establish a pay mechanism to ensure claims are paid. We also maintain the board gives the commissioner advice about the solvency of insurance companies. The number of insolvent companies in Nevada is growing, and the impact on EICON is significant. We want a seat on the board.
Senator Neal:
Is EICON having problems with insolvency?
Ms. Nelson:
Not right now. Our concern is the assessments we pay to hold up other companies. When a company is insolvent, the commissioner takes it over and other insurance companies are assessed to cover the cost of claims. We are also assessed for the failure of out-of-state companies. One of the largest last year was the failure of a company based in Pennsylvania. Our market share in property and casualty was 5 percent in 2000, and this year it is probably 4 percent. In workers’ compensation, our share is 28 to 30 percent.
Ms. Molasky-Arman:
We have had a number of insolvencies in the last several years. The major insolvencies for workers’ compensation were in California, where they had open pricing and THREE-way insurance. We worked hard to keep these practices out of Nevada and as a result have very stable workers’ compensation rates. Other major insolvencies have had to do with the entire property and casualty market. Both guaranty associations have a limit of $300,000 on claims.
Senator Hardy:
Is the assessment for insolvency ongoing? Do you assess in anticipation of problems, or only after problems happen?
Ms. Molasky-Arman:
The associations have a reserve established and base the assessment on that. If there is an overage, it is returned. The insurers reduce their premium taxes by the amount paid over a 5-year period.
Ms. Nelson:
Section 5 allows original fax and electronic signatures on insurance contracts. Section 6 allows original fax and electronic signatures on policies. This brings Nevada in line with federal standards.
Ms. Molasky-Arman:
We have no objection to this.
Ms. Nelson:
Section 7 talks about assessments by the Division of Industrial Relations (DIR). The amount each company is assessed is an estimate based on their predicted market share. At the end of the year these amounts are adjusted via refunds. We would like these refunds to include interest earned.
Roger Bremner, Administrator, Division of Industrial Relations, Department of Business and Industry:
We have always done this. Interest is paid by the State treasurer quarterly. When we issue refunds at the end of the year, we include any actual interest earned. We have no objection to putting it in the statute.
Senator Neal:
What is the purpose of this assessment?
Mr. Bremner:
It funds the DIR and other programs. It is a zero-balance fund; whatever is left over at the end of the year is returned as a credit against next year’s assessment.
Mr. Ostrovsky:
There is one fund that does not get a refund, and we want to be on the record to make sure we have no objection to that, to make sure that’s clearly understood. We do not intend to change that policy. That is, we think, very appropriate.
Mr. Bremner:
The uninsured claim fund is permanent and pays claims for people with no insurance. Those monies are not rebated, and the interest stays in the fund to pay uninsured claims.
Ms. Nelson:
Section 8 places the same earned interest requirement on refunds. Section 9 authorizes the commissioner to undertake a study to determine whether to enact the Model Investment Act for Insurers and report results in 2005.
Ms. Molasky-Arman:
I have no concerns about section 9. As it states in the bill, there are two models put out by the National Association of Insurance commissioners (NAIC): defined limits, and defined standards. Most states have not adopted either in its entirety. Nevada’s current provisions are defined limits. We have the minimum provisions we need to keep our accreditation status. I am happy to establish a committee to undertake this study.
Senator Neal:
Can you give some details of this program?
Ms. Molasky-Arman:
In order to keep our accreditation, we observe all new standards and laws recommended by the NAIC, which are designed to preserve and strengthen oversight of financial solvency of insurers. The time frames were set by the NAIC and allow 2 years to study the options and recommend a course of action to the Legislature.
SENATOR NEAL MOVED TO AMEND AND DO PASS AS AMENDED S.B. 319.
SENATOR HARDY SECONDED THE MOTION.
THE MOTION CARRIED UNANIMOUSLY.
*****
Chairman Townsend:
We will open the hearing on S.B. 261.
SENATE BILL 261: Eliminates certain restrictions imposed on governmental entities relating to acquisition or expansion of certain utility facilities. (BDR S-685)
Senator Neal:
I will withdraw this bill.
Chairman Townsend:
We will close the hearing on S.B. 261 and open the hearing on S.B. 348.
SENATE BILL 348: Requires certain lenders to meet with borrowers to execute loan documents before transmitting documents to title insurer. (BDR 57‑1178)
Senator Raymond D. Rawson, Clark County Senatorial District No. 6:
I was approached by title companies asking me to draft this bill. They are seeing a situation in which people come to their offices ready to sign papers to finalize a house purchase and suddenly discover the terms of the loan are not what the lender told them. There have been cases where the buyers have sold a home in another state and not discovered the discrepancy until they arrive at the title company to close. They cannot go back and they cannot move in until they sign papers which commit them to a higher interest rate, a huge balloon payment, or other terms they did not expect and for which they are not prepared. This bill is an attempt to prevent this situation by requiring lenders to meet with borrowers to go over the terms of the loan before closing. This is an area I do not normally draft in and with which I am not familiar, so there may be a better way to achieve it.
Senator O'Connell:
“I want to declare for the record that I have a son who is in the mortgage brokering business.”
Chairman Townsend:
“I would also disclose that I am a board member and a shareholder in a bank.”
Senator O'Connell:
“The bank also applies to me.”
Keith L. Lee, Lobbyist, Responsible Mortgage Lenders Coalition:
I have spoken with Senator Rawson about my clients' willingness to work with him on these issues. We want to fix the problem without interfering with the mortgage business.
The coalition thinks this bill is unnecessary. There are already regulations requiring the lender to give the borrower this information before closing. Lenders are required by the Real Estate Sales Practices Act (RESPA) to provide a good faith estimate of closing costs within 72 hours of the first contact with the borrower. At closing, federal law requires the borrower to be given a 2-page document from the U.S. Department on Housing and Urban Development (HUD) known as HUD-1 which lists every cost the buyer will incur. The Truth in Lending Act’s Regulation Z makes much the same demand.
It is not possible to give a borrower the exact final cost until escrow closes. Prorated costs such as insurance and taxes are determined on the day of closing. Some borrowers opt for a floating interest rate, which is fixed on the day of closing.
Many home loans are negotiated with no personal contact at all, being completely handled over the telephone or via the Internet. This bill requires the borrower and lender to meet face to face on the day of closing. This will require lenders to establish a new closing department with escrow officers, raising costs to the borrower.
Senator Neal:
We are essentially dealing with a contract situation. Are there any other requirements or statutes which govern this situation?
Mr. Lee:
Not that I know of. There is the possibility of a contract or tort action if there were fraud or misrepresentation in the disclosure.
Senator Neal:
I am concerned about the situation Senator Rawson described. A buyer from another state is not necessarily knowledgeable about our statutes governing property and could be at a disadvantage unless the lender goes over the loan in detail. A disreputable lender might take advantage of an unsuspecting borrower.
Mr. Lee:
The specific situation you describe would require legal counsel and would not be remedied by the bill in question. The phrase “fully discuss the terms of the loan” covers financial details such as interest rates, points, and fees, and is not defined to include the laws of Nevada.
Cheryl Blomstrom, Lobbyist, Nevada Consumer Finance Association:
I closed a loan this year via the Internet and never met the lender face to face. Closing was done at a title company where they went over every item in detail. This bill will increase the cost of home loans, which will price some prospective homeowners out of the market.
James L. Wadhams, Lobbyist, Mortgage Bankers Association of Nevada:
I suggest a subcommittee work with Senator Rawson on this. My organization is willing to work on this bill, but I am not sure what problem is being addressed here. One problem is the bill references chapter 692A of Nevada Revised Statutes (NRS), which covers title insurance rather than lending. I might also point out that financial institutions that do not have offices in Nevada are not subject to Nevada laws.
John M. Vergiels, Lobbyist, Nevada Association of Mortgage Brokers:
My organization’s solution to this problem is a form to be given to the borrower 3 days after the loan is initiated (Exhibit D). This is a modified version of the HUD-1 form.
Leo A. Davenport, President, Nevada Association of Mortgage Brokers:
The HUD-1 form is required to be given to the borrower 24 hours before closing. Federal law also gives the borrower the right of rescission 3 days after closing. Most wholesale lenders require the documents go directly to the escrow company; they will not send them to the brokers.
Michael Radde, President-elect, Nevada Association of Mortgage Brokers:
This bill will take away a layer of protection from the buyer. A fraudulent lender who lies to the borrower in the early meetings will continue to lie at closing. They will gloss over the details of the loan and encourage the borrower to simply sign without reading. If the borrower goes to a title company for closing, the title company is a disinterested third party who will tell them what they are actually signing. This is why the title company is there.
Pat Coward, Lobbyist, Nevada Land Title Association:
The title company is a disinterested third party that explains the facts of the loan. They do not pass judgment on the quality of the loan or express an opinion about it.
Senator Neal:
What recourse does the borrower have if he does not receive the HUD‑1 form?
Mr. Davenport:
The escrow company faces a $10,000 or $1,000,000 fine and a prison term from HUD and RESPA.
Senator O'Connell:
I would like more detailed information about what the fines are and who is responsible for administering them. We need to find out what controls are in place currently.
Chairman Townsend:
We will close the hearing on S.B. 348 and open the work session on S.B. 320.
SENATE BILL 320: Makes various changes to provisions governing industrial insurance. (BDR 53-600)
Chairman Townsend:
Exhibit E shows the proposed amendments, including new language from the original bill, new language proposed in this amendment, language deleted in the original bill, language deleted in the amendment, and language deleted in the original but put back in the amendment.
Mr. Ostrovsky:
This bill provides for external medical review of certain medical issues in workers’ compensation cases. External review is a new concept untried in any other state. The bill provides if a workers’ compensation case goes to appeal regarding a medical issue, the appeals officer will refer the case to a third-party external review organization for medical determination. Currently the appeals officer has the ability to send the claimant out for an independent medical evaluation (IME). However, the insurer and the claimant’s counsel also have the right to do this, and this sometimes results in competing medical opinions. External review is an independent, disinterested body which renders a binding medical opinion.
The bill directs the DIR to set regulations on how the external review organization is selected, then make a list of external review organizations available to appeals officers. The decision of the external reviewers would be binding on the appeals officer. If the claimant is dissatisfied, he can appeal to district court.
Senator Neal:
Are any of the appeals officers physicians?
Mr. Ostrovsky:
No. They are required to be members of the State Bar of Nevada, but they are not required to be physicians. This bill will result in better decisions rendered faster and possibly less expensively. The average cost of an IME is $1000. The external review might decide that a single test is required at substantially lower cost. This is covered by sections 2, 3, 6, and 13 of the bill.
Senator Neal:
Who selects and certifies these external review organizations?
Mr. Ostrovsky:
These organizations contract with top specialists in every field to review cases. They review the record and may see the patient, order more tests, or whatever they think is required.
Jack Kim, Lobbyist, Sierra Health Services, Incorporated:
One external review organization used by the federal government to review Medicare cases is the Center for Health Dispute Resolution. This bill was drafted to give the commissioner the leeway to contract with the type of organization best suited to the State’s needs for workers’ compensation cases.
Senator Neal:
I am concerned that this bill seems to be making the regulations more general than they were in the past. The law is being changed from laying out what each person and agency will do to telling the administration to set regulations. Will we need to come back next session and change it back?
Mr. Kim:
I had the same concerns, especially about section 13. I have an amendment to change this (Exhibit F), since I do not believe it was the intent of the bill. This is similar to language in an external review bill coming over from the Assembly.
Mr. Ostrovsky:
We agree with this amendment. It clarifies what we intended.
Chairman Townsend:
If a claimant goes to the appeal level, do the records go to IME or external review before the appeal so the appeals officer has the information before the hearing? If external review is binding on the hearing officer, he should have the information as quickly as possible so the claimant can get the proper medical care.
Mr. Kim:
The point of the bill is to give the hearing officer a way to decide between conflicting medical opinions.
Lawrence P. Matheis, Lobbyist, Nevada State Medical Association:
I am concerned that two parallel processes will be set up with the different bills on this same matter.
Chairman Townsend:
The bills will be merged eventually.
Senator Neal:
I have talked with Assemblywoman Barbara Buckley regarding her bill on external review.
Chairman Townsend:
Her bill deals mainly with health care in general. If we extract the material specific to workers’ compensation and apply the material about external review, are the two bills consistent?
Mr. Ostrovsky:
We have no issue with that.
Ms. Nelson:
We agree with that. The procedure should be the same whether the patient has an issue with their health maintenance organization or their workers’ compensation managed care organization. We have talked to Assemblywoman Buckley on combining the two concepts. One difference between the two situations is that in health care cases, either the insurer or the patient can ask for external review. In workers’ compensation cases, the appeals officer and the employer can also request external review. The employer has the right to contend compensability.
Mr. Matheis:
It is important to note that the external review organization’s role is to decide on the appropriateness of medical decisions, not on the compensability of the claim.
Chairman Townsend:
Once the appeals officer has requested an external medical review, how long does it take for review to occur?
Mr. Mathies:
It depends on the urgency of the matter. Urgent and emergent situations should be immediate, ideally a matter of hours. If the condition allows a longer time frame, it might be days or weeks.
Mr. Ostrovsky:
Section 6 states that within 5 days of the referral, the external review organization must decide if it has enough information. They must render a decision within 15 days of receiving the information. There is no time limit on how long it takes them to receive the information. Most workers’ compensation cases are not emergency issues by the time they reach the appeals level.
Nancyann Leeder, Nevada Attorney for Injured Workers, Department of Business and Industry:
The bill would appear to be leaving the patient liable for the cost of the external review.
Mr. Ostrovsky:
The amended version of section 13 spells out that the insurer pays for external review.
There are three sections on which there has been disagreement. Section 5 has to do with credentialing fees. Section 8 deals with which edition of the American Medical Association’s Guides to the Evaluation of Permanent Impairment will be used. Section 9 deals with primary cause; there is disagreement about the terms “substantial contributing” and “preponderance of evidence.” All of these sections have triggered debate, and discussions on these matters will take time. I will meet with the opposing parties and try to resolve these issues.
Chairman Townsend:
The committee will return this bill to work session a week from Friday. Give any amendments you agree on to Scott Young, Committee Policy Analyst, and he will plug them into the bill for us.
We will close the work session on S.B. 320 and open the work session on S.B. 240.
SENATE BILL 240: Revises various provisions relating to benefits payable to surviving spouses and children of certain police officers and firemen. (BDR 53-696)
Chairman Townsend:
“There are two components to this bill, and I want to state that for the record.” The first component has to do with S.B. No. 404 of the 70th Session (Exhibit G), which was effective October 1, 1999. Section 3 of S.B. 240 makes the former bill retroactive to January 1, 1998, in order to provide coverage for Carolyn Sullivan and the other person inadvertently excluded from this provision. Neither of the entities involved, which is the University of Nevada at Reno for Mrs. Sullivan and the Metropolitan Police Department in Las Vegas, has disputed this change.
Ronald P. Dreher, Lobbyist, Peace Officers Research Association of Nevada:
It needs to be pointed out that section 3 is prospective only. It starts July 1, 2003, and does not recoup the more than $10,000 Mrs. Sullivan has paid. This is also spelled out in sections 4, 5, and 6.
Chairman Townsend:
The other component of the bill has to do with the termination of benefits on the remarriage of a surviving spouse. The bill does not affect those who have lost their spouses in the past and since remarried, but it will affect those who lose their spouses in the future.
Mr. Dreher:
I researched A.B. No. 189 of the 70th Session that dealt with the remarriage penalty in the Public Employees’ Retirement System (PERS). The fiscal note for that bill indicated the cost of eliminating the remarriage penalty was insignificant, with an increase of 0.03 to 0.04 percent.
Mr. Ostrovsky:
The fiscal note of S.B. 240 shows a much greater impact. One reason for the difference is PERS is a $13 billion fund. This bill deals with a much smaller fund, so the effect will be much greater.
Ms. Nelson:
“I would like to make clear for the record that EICON is not here to oppose this bill.” This bill has three separate issues: the prospective change, the retroactive change, and the health benefits. Our actuaries have calculated the cost over the next 40 years, if the benefits were made retroactive for police and fire only, would be $460,700, and the present-day discounted cost would be $230,000. For all industrial injuries, the cost would be $10,580,000, and the present-day discounted cost would be $5,450,000. These are based on records going back to the 1950s when EICON covered everyone in Nevada.
Chairman Townsend:
Mr. Carlson, how do your numbers mesh with these figures?
Wayne Carlson, Lobbyist, Public Agency Compensation Trust:
Our figures (Exhibit H) are based on actual death cases since 1996. The additional cost for two more cases is $450,000. We cover rural governments, including police and fire. The section labeled “Potential Death Cases” was figured to include those who will die from heart and lung ailments, since the bill does not use the phrase, “killed in the line of duty.”
Chairman Townsend:
Was that not the intent?
Mr. Powers:
For sections 1 and 2 of the bill, it’s not limited to police officers and firemen killed in the line of duty. The provisions of section 3 that extend retroactively are applied to police officers and firemen killed in the line of duty, but sections 1 and 2 are not limited to that.
Chairman Townsend:
Was that your intent, Mr. Dreher?
It was our intent that sections 1 and 2 apply to those killed in the line of duty.
Mr. Carlson:
It was our understanding that deaths from heart or lung disease occurring while the person is still employed are considered “in the line of duty,” while those occurring after the person has left or retired are not. Removing the remarriage penalty increases costs dramatically.
Chairman Townsend:
I do not want to prolong this for Mrs. Sullivan. The committee will work on the other portions of the bill. If they are not satisfied with them, we will delete those sections and leave the part of the bill correcting Mrs. Sullivan’s situation. We will discuss this bill again at the next work session.
There being no further business, the meeting is adjourned at 10:25 a.m.
RESPECTFULLY SUBMITTED:
Lynn Hendricks,
Committee Secretary
APPROVED BY:
Senator Randolph J. Townsend, Chairman
DATE: