MINUTES OF THE
SENATE Committee on Finance
Seventy-second Session
February 10, 2003
The Senate Committee on Financewas called to order by Chairman William J. Raggio, at 8:00 a.m., on Monday, February 10, 2003, in Room 2134 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Senator William J. Raggio, Chairman
Senator Raymond D. Rawson, Vice Chairman
Senator Dean A. Rhoads
Senator Barbara K. Cegavske
Senator Sandra J. Tiffany
Senator Bob Coffin
Senator Bernice Mathews
STAFF MEMBERS PRESENT:
Gary L. Ghiggeri, Senate Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Julie Walker, Committee Secretary
OTHERS PRESENT:
Robert R. Loux, Executive Director, Agency for Nuclear Projects
John P. Comeaux, Director, Department of Administration
Jeanne Green, Director, Department of Personnel
Kim Foster, Administrative Services Officer, Department of Personnel
Ron W. Sparks II, Director, Western Interstate Commission for Higher Education
Giles E. Vanderhoof, Major General, The Adjutant General of Nevada, Office of the Military
Miles Celio, Administrative Officer II, Office of the Military
This morning we will hear budget overviews of High Level Nuclear Waste.
High Level Nuclear Waste–Budget Page ELECTED–9 (Volume 1)
Budget Account 101-1005
Robert R. Loux, Executive Director, Agency for Nuclear Projects:
The agency consists of three entities. There are two divisions, technical and planning, within the agency, plus the Commission on Nuclear Projects, which is advisory commission. The agency also provides policy and other recommendations to the Governor and the Legislature. The commission’s biennial report gives a comprehensive summary of the status of our program. Its recommendation is to continue the activities and the policy positions adopted by the State over the last 15 to 20 years.
The Secretary of Energy recommended to the President that the Yucca Mountain site be developed as a repository. The President recommended the site to Congress. The Governor vetoed the recommendation, and in July 2002 both houses of Congress passed a resolution overriding the Governor’s veto, which was signed by the President. The State filed legal actions against the Department of Energy (DOE) and others. We believe these recommendations by the secretary and the President were based on an illegal and faulty set of regulations developed by the DOE to assess the suitability of Yucca Mountain.
We also believe an environmental impact statement was procedurally and substantively defective in many areas. The Nuclear Regulatory Commission (NRC) was sued relative to a licensing rule, and the Environmental Protection Agency (EPA) was sued relative to a set of regulations a belief that health and safety standards were inadequate. These three cases are the core of the issue we have with the program. Over a period of time, it must be the geologic and natural setting that provides long-term isolation and protection from the material rather than man-made materials and engineered barriers that the DOE proposes. The DOE now recognizes that the site provides less than 1 percent of the necessary isolation and protection to meet the 10,000-year standard. We believe it is illegal, both under the statute and relative to scientific principles it was based upon, to rely exclusively on the metal waste package and the metal container in which the waste would be confined.
Senator Raggio:
Why is it illegal?
Mr. Loux:
The statute says that any selection of a site must be made primarily on the geologic criteria of the site to isolate these materials. It is clear, not only in the statute, but also in the legislative history that it must be the geologic structure that provides this isolation and protection. The NRC lawsuit is based on the same premise, and the Environmental Protection Agency (EPA) lawsuit is based on the lack of time, performance, and inadequate standards to protect the ground water. Those three cases will be ready for oral argument before the U.S. Court of Appeals in Washington, D.C., in September 2003. We anticipate a decision from the U.S. Court of Appeals in December 2003 or January 2004. Sixty to seventy percent of the costs of these lawsuits have been incurred, all research has been completed, and the final briefs are being put together now.
There is a fourth case that the attorney general filed against the federal government in January 2003. It is a constitutional challenge to the resolution approved by the Congress that overrode the Governor’s veto. Now the DOE admits there is no rational basis for the selection of the Yucca Mountain site because that site is irrelevant in terms of waste isolation. In other words, it is not a unique physical site that provides the required isolation for the time in question. A metal waste container could go anywhere. Therefore the selection of the site was unconstitutional. This case has been filed. Eighty percent of the research has been finished and eighty percent of the costs have been incurred.
Senator Raggio:
Has Nevada won any of these cases in the lower court?
Mr. Loux:
The law does not allow us to file them in the lower court. The law prescribes that they be filed in the courts of appeal. We have had cases in the Ninth Circuit Court, all of which were determined to be premature because the DOE had not made a final decision about the site or the environment at the site. We did win one case in which the DOE was trying to prohibit the State from doing scientific research that we thought was important to understand the site. The DOE proposed a set of regulations that would put them in charge of deciding what issues we could examine, and the court determined that to be illegal.
Senator Raggio:
What was the case?
Mr. Loux:
The State wanted to do research with the oversight money provided by DOE and DOE opposed that. We filed suit in the Ninth Circuit Court and the court determined DOE could not restrict what information could be gathered.
Senator Raggio:
Do we get $2.5 million a year from federal funding?
Mr. Loux:
That is correct.
Senator Raggio:
Can that be used only for scientific oversight?
Mr. Loux:
Yes, that is correct.
Senator Raggio:
Are we currently in line with the proper use of federal funds?
Mr. Loux:
Yes, we have allotted the funds from the federal government exclusively to geology, hydrology, corrosion work on the metal waste package, and volcanic issues, all of which are deemed to be scientific oversight.
Senator Raggio:
How is the $5 million going to be used over the biennium?
Mr. Loux:
It will be used for those four or five areas we have worked on.
Senator Raggio:
With whom do you contract?
Mr. Loux:
The majority of the work being done is in the corrosion area, and we have a contract with Geosciences, Inc., in Boulder City. It subcontracts with Catholic University in Washington, D.C., an institution that is renowned for work in corrosion.
Senator Raggio:
Is the university system doing any of this?
Mr. Loux:
The University of Nevada, Las Vegas (UNLV), is the primary contractor with the issue of volcanic hazards that might be present at Yucca Mountain. We also have Nevada contractors doing most of the geologic work. Our hydrology contractor is in Minnesota.
Senator Raggio:
How long are these contracts?
Mr. Loux:
Most are annual contracts. Every 2 years we rebid them and resolicit for competing proposals and designs, but we have had many of these contractors for a long time.
Senator Raggio:
Does our staff have a list of these contracts and the parameters?
Mr. Loux:
A list of every contract, scope of work, and amount and duration of work on high level waste is provided to your committee semi-annually.
Senator Raggio:
What is the $150,000 a year from the Western Governors’ Association (WGA) used for?
Mr. Loux:
The DOE provides money to the WGA to help coordinate the transportation of transuranic or intermediate level radioactive waste to Carlsbad, New Mexico, where there is an existing repository. In turn, the WGA funds most of the western states’ entities, such as emergency response, health division, and others. These entities go through exercises related to the shipment of this material, training, and equipment acquisition. We pass all of that money on to the highway patrol, health division, emergency management, and other entities with a role in transportation issues. However, the only shipment of material in Nevada has been projected take place this spring. Eighty shipments of transuranic waste will leave from the Nevada test site to go to Carlsbad. We have been working with our agencies and local government to make sure they are ready if and when the DOE ships that material out of the test site. We have an agreement with them that it will not go through the Las Vegas Valley, but it would go south from the test site directly into California and then via I-40 all the way to New Mexico.
Senator Raggio:
What is the reason for a 9 percent increase in General Fund money to your agency?
Mr. Loux:
It will be used for seven full time equivalencies (FTEs).
Senator Raggio:
Was there a $4 million appropriation in the last session to support the legal expenses?
Mr. Loux:
That is correct.
Senator Raggio:
There was another $3 million to be matched from the contingency fund for the media campaign. What is the status of that funding?
Mr. Loux:
Four million dollars was used for Nevada Protection Fund. Another $3 million was appropriated for the media campaign, subject to a match. Since then we have brought in $.5 million of private money based on that matching requirement.
Senator Raggio:
Was the Nevada Protection Fund used for legal expenses?
Mr. Loux:
Both monies, one for legal expenses and one for public relations, went into the same Nevada Protection Fund. They were accounted for separately. We have $1.9 million left from the protection fund for legal costs.
Senator Raggio:
Is that still available from the $4 million?
Mr. Loux:
Yes.
Senator Raggio:
What about the $3 million to be matched for media?
Mr. Loux:
We matched $2 million, and there is $1.057 million remaining in the Nevada Protection Fund.
Senator Raggio:
Is the media campaign over?
Mr. Loux:
We have incurred and paid all of the expenses associated with the media campaign.
Senator Raggio:
Will the $1.057 million be available for reversion to the General Fund?
John P. Comeaux, director, department of administration:
Yes, as far as I know there are no plans to do otherwise.
Senator Raggio:
In the attorney general’s budget there is another appropriation of $2 million to the attorney general’s special fund for legal costs associated with Yucca Mountain. What are the total legal expenses anticipated over the biennium?
Mr. Loux:
If the government is successful in the cases, there will be an appeal and there will be some costs. Additionally, we are getting ready for licensing. The DOE needs to acquire a license from the NRC.
Senator Raggio:
When do you anticipate that will be done?
Mr. Loux:
It will be done in December 2004, and the State is required to have all arguments fully developed and all challenges filed. That will require additional legal and scientific research.
Senator Raggio:
Is there optimism that we will prevail before the NRC?
Mr. Loux:
Yes. We believe that the decisions by the Secretary of Energy and the President are going to be overturned. The whole program will then be remanded to DOE. After that it will be hard to predict. Keep in mind that while this is going on, there is a facility in Utah for high level waste. It is a temporary facility that is being proposed by the industry on Indian land outside of Salt Lake City. That facility is going to get a license from the NRC within the next month. It could accept high level waste from power plants by the end of the calendar year, perhaps as much as 40,000 metric tons. If we are successful in our cases, and there is another option available to the utilities and government, the DOE may seriously consider the Utah facility instead of having to repeat this process with the State of Nevada.
Senator Coffin:
What is the jurisdiction of these cases?
Mr. Loux:
Our lawyers believe the Washington, D.C., circuit is not only familiar with nuclear waste and related issues, but also has ruled against the DOE. The three judges that we have drawn for hearing the cases are very strict statutory constructionists. We think that is favorable to Nevada.
Senator Coffin:
Have you followed the history of the nominees for vacancies in this court?
Mr. Loux:
I have not.
Senator Rhoads:
Was there a dispute on water rights between the federal government and the State of Nevada?
Mr. Loux:
There is still such a case and I have not gotten to it yet. The federal government had a temporary water right for Yucca Mountain for the purpose of site characterization and studying the site. When the Secretary of Energy made his decision that the site was suitable for a repository, legally that is the end of site characterization and site study. The DOE then applied for rights on a temporary basis and also applied for a permanent water right at Yucca Mountain to construct and operate a facility. The State opposed both of those applications and denied them. The DOE sued in Federal District Court in Las Vegas, as opposed to state court, which we think is the proper venue.
In both of those cases the DOE is indicating that the site characterization phase is over, but they still want more money for study at Yucca Mountain. We are suggesting it has to be one way or the other. Our position regarding permanent water rights is that, even though the site has been recommended and approved, a license is required from the NRC. Until they have that license water is not needed to construct and operate a facility. The water engineer has agreed to provide them some temporary water rights for site-maintenance purposes. We have asked the court to stay DOE’s application for permanent water rights. They have asked for a summary judgment in that case.
In the cases in Washington, D.C., referred to earlier, the government’s defense in DOE’s case has been that the resolution approved by Congress is new law and supercedes everything that is in the Nuclear Waste Policy Act, the law we have been operating under the last 20 years. As a result, our challenges are moot. We argue that we are litigating the heart of that, whether the resolutions of Congress say that or not, and we have asked that the proceeding in the water case be stayed until those issues are resolved. If they are resolved in our favor, they will not need the water.
Senator Tiffany:
Where is the 9-percent growth that is built into this budget for the General Fund?
Mr. Loux:
Perhaps it is for the Department of Information Technology (DoIT).
Senator Tiffany:
How do you use the DoIT?
Mr. Loux:
We maintain a website and have e-mail. Those items involve increased costs by DoIT in trying to maintain the system to provide those services.
Senator Tiffany:
Would a website and e-mail cause a 9-percent increase?
Mr. Loux:
In our budget their portion has grown dramatically over the last 4 years.
Senator Tiffany:
Could you provide that information for me by Thursday?
Mr. Loux:
Yes.
Senator Tiffany:
What happened to the $1 million we gave to Brown & Associates to fight the transportation issues?
Mr. Loux:
Brown & Associates was the contractor our State and congressional delegation hired to keep Congress from overriding the Governor’s veto. A lot of their costs were a part of the larger campaign. I provided all of the Interim Finance Committee (IFC) members with a book that listed all activities that have occurred state by state, including those undertaken by Brown & Associates. I do not have that with me today.
Senator Tiffany:
Will there be any more of those marketing campaigns in the next 2 years?
Mr. Loux:
If we prevail in the cases and they are remanded back to DOE and DOE tries to go forward again, there could be another campaign to persuade congress. That may involve lobbying in Washington, D.C., advertising expenses, and campaigns in certain selected supportive states.
Senator Tiffany:
If that happened, would you go back to IFC?
Mr. Loux:
Absolutely.
Senator Tiffany:
What is the total amount we have left for the lawsuits in your budget and the Attorney General’s budget?
Mr. Loux:
We have $1.9 million left in the Nevada Protection Fund for that work. An additional $2 million is proposed.
Senator Cegavske:
If there is an accident or a spill, are there funds available to us or other states for clean-up?
Mr. Loux:
There is a requirement in the federal law that DOE has to implement a grant program to states and local governments along shipping routes to provide monies for emergency response training and equipment. To date, the DOE has yet to implement or even establish rules for that.
Senator Cegavske:
Can that be made a stipulation in all of the negotiations? We have been told it would be in the billions for any type of clean-up. Is there any plan for the government to help, or would our State be responsible for clean-up?
Mr. Loux:
If you are talking about high level waste, that would not happen for some time. The Department of Energy does not have to implement grants until 3 years before shipping starts. The DOE provides the State with $.50 per cubic foot of every low level waste shipment that is made to the Nevada test site. That money goes to the division of emergency management, which in turn funds all of the counties in southern Nevada through which the waste is transported These monies are for emergency management, training, and equipment. The DOE indicates it stands ready as the primary responsible party for an accident or spill. It is not in writing yet, but there was a case where it did provide some clean-up for a leak.
Senator Cegavske:
There has been a problem in the past of not being notified of every shipment. Has that been remedied?
Mr. Loux:
High level waste shipments and spent fuel have to be made known to the State’s designated person, but it is safeguarded information and not to be revealed to the public. There is no requirement for the DOE to provide any notification to the State on low level shipments or transuranic shipments.
Senator Raggio:
We will hear Budget Account 1363.
Personnel - Budget Page PERSNL-1 (Volume 1)
Budget Account 717-1363
Jeanne Greene, Director, Department of Personnel:
I have provided a handout to the committee from which I will make my presentation, Department of Personnel Budget Presentation to the Senate Committee on Finance. (Exhibit C. Original is on file in the Research Library.). Following page 1 is a fold-out organizational chart. The color-coded positions in the chart are affiliated with our enhancement units. On page 3 is a pie chart showing our resource allocation of positions within the department. You will see a state employee profile on page 3-A which may be of interest to the committee.
Senator Raggio:
Do you have 83.51 FTEs?
Ms. Greene:
That is correct.
Senator Raggio:
Is the budget recommending some additional FTEs?
Ms. Greene:
We are requesting one new position, one transfer position from DoIT into our budget, and one half-time position to be made full-time.
Kim Foster, Administrative Services Officer, Department of Personnel:
The Department of Personnel (DOP) is funded by uniform assessments of all agencies served. The assessment is set each biennium as a percentage of all classified salaries in the Executive Branch. The payroll is similarly set as a percentage of budgeted salaries for agencies served by the central payroll system. We also have $10,000 dollars allotted for subscription training as a pass-through account. Last, we have miscellaneous revenue which we bring in for processing child support payments, Internal Revenue Service (IRS) levys, and wage garnishments.
Page 5 denotes an expenditure summary of the budget. The enhancements with asterisks were recommended by the personnel task force, a Governor-appointed 9-member committee assigned to review the personnel system. Next is a summary of our base and maintenance budgets on page 6.
Ms. Greene:
The majority of our enhancements were recommendations made by the Governor’s personnel task force. They provide a basis for increasing efficiency and effectiveness of State employees. The enhancements begin on page 7 of the handout. Enhancement E-275 is Payroll and Records Relocation and E-276 is Harassment/Discrimination Investigation Unit.
Senator Raggio:
When the settlements referred to on the chart on page 9 are made, will there be any recovery from the errant employee?
Ms. Greene:
I do not believe so.
Senator Raggio:
Does the State have to pay for the employee’s misdeeds?
Mr. Comeaux:
That is right.
Senator Raggio:
I request that staff inquire of the attorney general’s office on this.
Ms. Greene:
I will discuss E-277, Certified Public Managers Program, on page 10 of the handout.
Senator Raggio:
What is a certified public managers program?
Ms. Greene:
It is a national consortium established in 1979. There are 29 states that currently participate in this program. We are proposing to add this to our existing training program. This would allow our supervisors and managers to go through a stringent training program and finally become certified public managers.
Senator Raggio:
What is the cost of that program?
Ms. Greene:
That is explained on page 11. We added it into our budget for the first 2 years. Thereafter, it would not be an ongoing cost in our budget. The agencies would have to incur those costs.
Senator Raggio:
What are we going to get for $200,000?
Ms. Greene:
We will get trained managers and supervisors.
Senator Raggio:
Do we have training for managers now? Why must we join some national group to certify training? I thought we had good training programs already in place for managers.
Ms. Greene:
We have some training programs, but this goes beyond what we currently provide. Under this program they would have to identify problems in their agencies, determine how the problems could be solved, and implement the problem-solving process. Missouri is considered our mentor state. One of our staff members met with the legislative auditor and members of the legislature and they felt it was a beneficial program.
Senator Raggio:
Is this necessary at this time?
Ms. Greene:
We feel there would be a savings to the State because we would have better managers who would be more effective in the future. Unit E-278, Employee Management Committee Training is covered on page 13; E-279, Panic Buttons, is on page 14; and E-280, Additional Office Space, is on page 15.
Ms. Foster:
Next, E-281, Document Imaging, is a technology improvement project for an employee service file document digital imaging and indexing system. An explanation of the enhancement is shown on page 16. This will result in a lot of time savings.
Senator Tiffany:
Are you going to contract with a third party to do the conversion and then own the system, or will you only have access to the files?
Ms. Foster:
We would contract with a third party for the equipment and software.
Senator Tiffany:
Why are you not using what the libraries and archives already have?
Ms. Foster:
We worked with them when we were putting this project together and they did not have what we needed to complete it.
Senator Tiffany:
Are you working with DoIT on this?
Ms. Foster:
We did work with the DoIT. I am not sure we can share that resource.
Senator Tiffany:
I believe you need it, but I wonder whether it could be shared.
Ms. Greene:
Unit E-282 on page 17 is the equal employment opportunity additional training. That unit ties in with the investigation unit and we are hoping it will reduce costs in the end. E-285 is Workforce Planning, which I will review on page 18 of the handout. You can observe in the chart the percentage of employees that will be eligible to retire in the next 5 years. We are requesting $50,000 each biennium. The first year we will be hiring a consultant to assist the State in completing three steps in workforce planning.
Senator Raggio:
Could we defer this for 2 years?
Ms. Greene:
I do not believe we can because we will be losing significant numbers of employees in the next 5 years, and we need a plan in place to recruit and bring in trained individuals.
Senator Raggio:
Do we have a plan in place now to recruit and bring in people? I thought that was what the Department of Personnel did.
Ms. Greene:
We do recruit, but we do not have a long-range plan for bringing in individuals for these highly trained positions.
Senator Tiffany:
I pulled up the audit report, and since 1997 there have been requirements on the financial management aspect and on creating entry-level programs for our universities. This has been going on for 8 years.
Ms. Greene:
We continue to bring in our current college graduates. Many are not interested in coming into State service immediately. Our salaries are not as competitive with other governmental entities and private organizations.
Senator Tiffany:
Should we just let that be the answer?
Ms. Greene:
No. We just established a new classification that will allow individuals to come into entry-level State service without testing. Then they will be tested to go up the ranks.
Senator Tiffany:
When I look at the past chronic problems of promoting people without the right qualifications, promoting people without competitive processes, not having the entry-level programs needed to attract university students, I believe those need plans too.
Ms. Greene:
Absolutely. I think we have addressed all of those issues.
Senator Tiffany:
It looks as though you agree, but you have not done anything.
Ms. Greene:
In the second year of the biennium, funds would be used to begin implementation of the plan’s specific strategies and actions pertaining to the development, recruitment, and retention of employees having specialized skills in the most critical areas. We do not anticipate any ongoing costs incurred from this.
Ms. Foster:
Decision unit E-710, is equipment replacement, which contains computer hardware replacement and software upgrades. A review can be found on page 20. I will discuss E-901 and E-910 together because they are a transfer of costs from other departments to the DOP for the Integrated Financial System-Human Resources (IFS-HR) System. You may refer to page 21 of your handout for the discussion.
Senator Raggio:
Is this one of the new positions to be added?
Ms. Foster:
It does add another position, but it is a transfer from DoIT.
Senator Raggio:
Does the volume justify this position?
Ms. Foster:
Yes.
Senator Raggio:
How many occupational studies are you planning for the next biennium?
Ms. Greene:
We are conducting three, including rehabilitation division, all the engineering-related positions, and mechanical and construction trades. We have changed the method of doing occupational studies, so we do not anticipate coming back next session with a cost to implement the studies. We are looking at revising the class specifications to ensure that the qualifications are appropriate and the duties are accurate.
Senator Raggio:
The Western Interstate Commission for Higher Education (WICHE) Budgets are next.
W.I.C.H.E. Administration – Budget Page WICHE-4 (Volume 1)
Budget Account 101-2995
W.I.C.H.E. Loan & Stipend – Budget Page WICHE-1 (Volume 1)
Budget Account 614-2681
Ron W. Sparks, ii, Director, Western Interstate Commission for Higher Education:
During the last biennium we have been occupied with our health care access program and with our professional student exchange program. These have had a tremendous effect on the workforce in the health fields, especially in the underserved areas. We also developed and enhanced our pro bono program, to allow some of our students to come back to the State to fulfill their mandatory obligation to us, but who are not working in our State at this time. They work free of charge with a commitment from us to reduce their required payback to the State. Our biggest field is dentistry, with 20 dentists caring for the underserved through this program.
Budget account 101-2995, is a very flat budget. The requested amounts are straight across. We are not asking for increases except for those which were mandated. We also had maintenance requirements for inflation and fringe benefit changes.
Budget account 614-2681 is our loan and stipend fund budget. We are asking to match funds going to our students in the dental program with federal funds received from the School of Medicine and the Center for Education and Health Resources outreach. I have a letter stating their cooperation with us. The result will get people out into the community sooner because we give them the funds after they graduate and are licensed. It will not be a cost to the budget.
Senator Raggio:
How much is available in federal funds for this program?
Mr. Sparks:
About $80,000 is available, but we are only proposing a $26,000 match for federal funds.
Senator Raggio:
Is this being applied for, or is this a fact?
Mr. Sparks:
It is a fact. It comes from the university through Carolyn Ford’s Center for Education Health Outreach. The funds have had to be turned back in the past because they have not been able to match them.
Senator Raggio:
Our staff would like to receive the information on this grant, the fact it was awarded, the conditions, the criteria for receipt of the funds, federal definition of underserved population, which communities will make use of the program, and a copy of the memorandum of understanding between WICHE and the University of Nevada, Reno (UNR) Medical School. Will the UNR Medical School administer the grant?
Mr. Sparks:
They are going to administer the grant from the federal side, yes.
Senator Raggio:
What happens if the 2-year obligation is not met?
Mr. Sparks:
A salary payment will be required.
Senator Raggio:
How will you identify these candidates?
Mr. Sparks:
That will be cooperation between us and the university system.
Senator Raggio:
Will the grantees in the program be graduates?
Mr. Sparks:
Yes, our plan is to give the money to dental students who are going to attend UNLV when they graduate. The current plan will be to fund two students from out of state since there is not yet a UNLV graduating class.
Senator Raggio:
What professional slots are contemplated for the next biennium in addition to that?
Mr. Sparks:
It is a continuation of the same slots that we have had before in dentistry, mental health, nursing, optometry, pharmacy, physical therapy, physician assistants, and veterinary medicine.
Senator Raggio:
Are you eliminating any slots in the new budget?
Mr. Sparks:
We reduced our physical therapy slots from three to two, and our veterinary medicine from four to three to meet the 3-percent budget cut.
Senator Cegavske:
My concern is the need for professionals to train the nurses, such as teachers who are trainers. Do you know why this group is not included?
Mr. Sparks:
We are including slots for nurses. You only see the number of slots we have available, but we broke down the slots as to how many we are going to give to each area. We have two slots specifically designated to go to the nursing faculty positions.
Senator Cegavske:
The education teachers group is the other one that is not in here at all.
Mr. Sparks:
Last session we brought forward a teaching proposal and it was not successful. We did not get a response from that.
Senator Cegavske:
Who did you think would respond?
Mr. Sparks:
It was a program with Clark County School District, and it was the Governor’s proposal.
Senator Raggio:
Will we still need the program for dentistry since we have a dental school?
Mr. Sparks:
Absolutely. The reason we need it is that we fund students to get their degrees, and then we require them to go to the underserved areas when they are finished. We make sure they work with the underserved. It is a good incentive program.
Senator Raggio:
Do you have ten new slots in the nursing program?
Mr. Sparks:
We have the equivalent of $51,000. It is funded at the out-of-state level cost; however, we will probably fund them all in-state which means we will have $51,000 to go toward nursing.
Senator Raggio:
If we are expanding our nursing programs at Nevada State College (NSC) and they can get training in the state, why do we need a WICHE program?
Mr. Sparks:
They can get training in the state, but we are going to put them in the underserved areas.
Senator Raggio:
Can we do that with some of our scholarships and the Nevada programs?
Mr. Sparks:
I do not know if there is a scholarship designated to go to incentives to do that, but I am sure we could.
Senator Raggio:
The original idea of WICHE was a subsidy for students for out-or-state training.
Mr. Sparks:
That is correct, but as we expanded and as the audit required, we were asked to put together a health access program.
Senator Coffin:
Is it necessary to have pharmacy slots when there is a successful private pharmacy school operating in Las Vegas?
Mr. Sparks:
Those slots are also going to the underserved communities. We are trying to find out if there is any area in which we could help the private pharmacy school or whether we could work with them.
Senator Coffin:
Is there a way to fund or get some agreement for in-state underserved areas through the private organization if we subsidize the people attending that school?
Mr. Sparks:
We are having discussions, and will see where that may lead.
Senator Raggio:
What is the status of students who owe money?
Mr. Sparks:
Our collections are on track.
Senator Raggio:
Can you provide a list of those?
Mr. Sparks:
Yes.
Senator Raggio:
Who is making that effort?
Mr. Sparks:
It goes through us and the attorney general’s office.
Senator Raggio:
Do you have a collection service?
Mr. Sparks:
No, we do not.
Senator Raggio:
How much is delinquent?
Mr. Sparks:
We have debt of $126,000 that we are seeking to recover through the Office of the Attorney General. Our delinquent loans compared with our total loans outstanding are 8 percent.
Senator Raggio:
Because we take a dim view of professionals earning a living and not meeting their responsibilities, we would like to see that list.
Mr. Sparks:
Our biggest goal is to protect the State’s dollar.
Senator Raggio:
In addition to Mr. Shaff, who are the other two commissioners?
Mr. Sparks:
Senator Rawson and Chancellor Jane Nichols.
Senator Raggio:
We will go to Budget Account 101-3650.
Military – Budget Page MILITARY-1 (Volume 3)
Budget Account 101-3650
Adjutant General Construction Fund – Budget Page MILITARY-6 (Volume 3)
Budget Account 101-3652
Giles Vanderhoof, Major General, The Adjutant General of Nevada, Office of the Military:
In my capacity as adjutant general, I command 3000 Nevada Army and Air Guard members, and supervise 74 State of Nevada employees. This budget is a lean budget. The State expenditure is an essential factor in the guards’ ability to achieve and maintain military mission readiness. These State funds primarily contribute to the maintenance and repair of our training facilities and infrastructure.
This budget is my projection for the minimum amount the guard needs in order to fulfill our responsibility to the State and nation. Fortunately, we were able to secure a higher rate of federal funding for utilities through our State/Federal Cooperative Agreements for the remainder of FY 2002 and next fiscal year, thus lowering the State share. If not for this unprecedented federal interim increase our State budget could not have been trimmed.
All of the State and federal missions performed by the National Guard were done with superb professionalism and excellence, and Nevadans can be extremely proud of the men and women that voluntarily serve in the Nevada National Guard.
We have an error in the 2003-2005 biennium budget for in-state travel. There is a higher figure than should be. We are working with Legislative Counsel Bureau (LCB) staff to correct it. One of our three accounts, the Office of the Military, Budget Account 3650, is flat except for less utility money. The construction fund, Budget Account 3653, is a flow-through account for federal construction dollars. The National Guard’s benefit account is the third account. We are currently paying 48 percent of those fees. Since the budget is flat, I really have nothing further on it.
Senator Raggio:
We had some questions on the savings to the General Fund, and utilities and maintenance not built into the Executive Budget. Will you work with staff on some of these questions?
General Vanderhoof:
Yes, sir.
Senator Raggio:
What about the National Guard benefits account, 101-3653?
National Guard Benefits – Budget Page MILITARY-8 (Volume 3)
Budget Account 101-3653
General Vanderhoof:
We call it tuition, but it is actually consolidated fees. That is flat-lined.
Senator Raggio:
Is there a lower rate of reimbursement now?
General Vanderhoof:
The rate is 48 percent.
Senator Raggio:
Is the reimbursement going down to less than that in the new budget?
General Vanderhoof:
I wish I could tell you, but with the uncertain conditions, I do not know. The 176 people mobilized a week ago will stay in Nevada. The Air Force has run short of security and asked the Army for help. We have mobilized army guards all over the country to help out. We are going to have over 130 people at Nellis Air Force Base. We will have over 30 at the Nevada National Guard facility. These people will be staying home unless their home unit is called up; then they will go back to that unit and leave. We will have to replace them with others.
Senator Raggio:
Is the payment for college credits still a valuable incentive?
General Vanderhoof:
Our recruiters tell us that it is the most valuable incentive we have.
Senator Coffin:
What about the increased tuition? Do you feel there is going to be a further decrease in the amount of subsidy for each person? The university is building a pretty high tuition rate into this new budget.
General Vanderhoof:
That is correct. If we did not have the unknown factor of mobilizations, I would tell you that amount would go down, that we could not maintain 48 percent at this amount because of the rising costs. The reason I am vague is that, if we go to war in Iraq, you will see more Nevadans mobilized and pulled out of school.
Senator Coffin:
What was the experience after the Gulf War in 1991; did we have a retention problem that could have been remedied by an increased incentive program to keep people?
General Vanderhoof:
It was a major factor in retention as is the Montgomery GI Bill, and some of the federal student loan-repayment programs we have. The State program is for the consolidated fees for Nevada schools. Hopefully, if we have a war it will be a short one, and we will have people return and go back to school. In this instance we do not know because we may be there for some time even after the war is over.
Senator Coffin:
These people are called up, not for immediate combat, but for occupation.
Senator Tiffany:
I want to know if you have complied with these audit requests. The focus was on financial administrative controls. What is the status on your corrections?
General Vanderhoof:
We have corrected every single item in that audit report except a few policies and standard operating procedures that we must finish. The discrepancies have been corrected. We should have the remaining policies and standard operating procedures corrected within the next few months.
Senator Tiffany:
Are the performance reviews being done on time? Is purchasing done outside of the normal process? Are you using the correct request for proposal (RFP) and not doing work before going to the board of examiners?
General Vanderhoof:
Yes.
Senator Raggio:
This meeting is adjourned at 10:04 a.m.
RESPECTFULLY SUBMITTED:
Julie Walker,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE: