MINUTES OF THE meeting
of the
Assembly Committee on Ways and Means
AND THE
Senate Committee on Finance
JOINT Subcommittee on Higher Education/CIP
Seventy-Second Session
April 1, 2003
The Assembly Committee on Ways and Means and the Senate Committee on Finance, Joint Subcommittee on Higher Education/CIP, was called to order at 8:10 a.m., on Tuesday, April 1, 2003. Chairman Morse Arberry Jr. presided in Room 3137 of the Legislative Building, Carson City, 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.
Assembly COMMITTEE MEMBERS PRESENT:
Mr. Morse Arberry Jr., Chairman
Ms. Chris Giunchigliani, Vice Chairwoman
Mr. Walter Andonov
Mrs. Dawn Gibbons
Mr. David Goldwater
Mr. Richard Perkins
Senate COMMITTEE MEMBERS PRESENT:
Senator William J. Raggio, Chairman
Senator Raymond D. Rawson, Vice Chairman
Senator Barbara Cegavske
Senator Bernice Mathews
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
None
STAFF MEMBERS PRESENT:
Mark Stevens, Assembly Fiscal Analyst
Gary Ghiggeri, Senate Fiscal Analyst
Rick Combs, Deputy Fiscal Analyst
Connie Davis, Committee Secretary
Carol Thomsen, Committee Secretary
OTHERS PRESENT:
Refer to Exhibit B.
DEPARTMENT OF HUMAN RESOURCES (BUDGET PAGE APPENDIX-11)
CIP 03-C01 - 150 BED PSYCHIATRIC HOSPITAL—LAS VEGAS
Daniel K. O’Brien, Manager, State Public Works Board, identified himself for the record. Mr. O’Brien introduced Carlos Brandenburg, Ph.D., Administrator, Division of Mental Health and Developmental Services.
Mr. O’Brien addressed the Governor’s recommendation to construct a new 150‑bed psychiatric hospital and stated that the new hospital would replace an outdated facility in Building Number 3 on the Southern Nevada Adult Mental Health Services (SNAMHS) campus in Las Vegas. The new psychiatric hospital proposal called for three 40-bed acute care units and a 30-bed psychiatric emergency services (PES) unit. Mr. O’Brien explained that while the full built‑out proposal of the SNAMHS was a 110,000 square foot, 190-bed psychiatric hospital with four 40-bed units and a 30-bed emergency unit, the proposal before the Subcommittee was strictly for the three 40‑bed acute units. Mr. O’Brien said the new Southern Nevada Psychiatric Hospital was an inpatient hospital that would serve the southern Nevada area and would provide patients an average stay of about 14 days before they returned to the community. Individuals with criminal problems, injuries, or other physical health problems were referred to other appropriate facilities for care.
Mr. O’Brien indicated that the psychiatric hospital was high on the Governor’s list of recommendations for General Obligation Bond funding because of the needs of the Las Vegas community. Mr. O’Brien referred to a document that had been distributed titled Facts About the New State Psychiatric Hospital in Las Vegas Valley (Exhibit C). In addition, a document that contained floor plans and cost estimates, Capital Improvement Project 03-C01 150 Bed Psychiatric Hospital (Exhibit D) was distributed.
Mr. O’Brien explained that the new psychiatric hospital was fashioned after the Dini-Townsend Hospital that was built in the Reno-Sparks area, and a picture of which was on the cover of the Capital Improvement Project 03-C01 150 Bed Psychiatric Hospital document (Exhibit D). Mr. O’Brien turned to page 7 of the document and discussed the amenities, a few of which included a courtyard surrounding the facilities, a therapy and multi-purpose gymnasium, a dining room, and a PES unit. Mr. O’Brien reiterated that the layout of the new psychiatric hospital in Las Vegas was based on the layout of the Dini‑Townsend Hospital, which had worked out well. Mr. O’Brien indicated that if the project was approved and if the Public Works Board authorized a “direct select” of the architectural firm that constructed the Dini-Townsend Hospital, the project would be saved approximately six months of construction design time.
Chairman Arberry questioned how the size of the proposed hospital was determined.
Dr. Brandenburg responded that there were currently 68 beds in Las Vegas, and at the end of the coming biennium, there would be 103 beds. In planning for the 150-bed facility, Dr. Brandenburg said that 30 beds would be for psychiatric emergency services, and by the next biennium a determination would be made concerning staffing for the other 120 beds. Dr. Brandenburg indicated the Division of Mental Health and Developmental Services was attempting to plan for the future and build a facility according to what was currently needed in Las Vegas.
In response to a question from Chairman Arberry concerning whether a study had been conducted, Dr. Brandenburg said the Division had conducted a study that revealed Clark County had only 4.4 psychiatric beds per one hundred thousand population, and there should be at least 33 beds per one hundred thousand population, which placed Clark County below the national average. Dr. Brandenburg indicated that on average there were approximately 15 individuals waiting treatment in emergency rooms because of the lack of psychiatric beds.
Chairman Arberry requested that a copy of the study be provided to staff and Dr. Brandenburg agreed.
In response to a question from Senator Cegavske concerning the selection of an architect, Mr. O’Brien explained that a northern Nevada architectural firm designed the Dini-Townsend State Psychiatric Hospital. Since the layout and details were so similar to the proposed psychiatric hospital in Las Vegas, Mr. O’Brien said the Public Works Board would be requested to allow a “direct select” of the architect to begin work on the drawings necessary to have the project reviewed and approved.
Senator Cegavske commended the Board’s “direct select” approach and questioned whether the Division had provided information she had previously requested on consideration of sites other than the Oakey Boulevard and Jones Boulevard site.
Dr. Brandenburg indicated “certain land developers in Las Vegas” had offered a potential 16-acre site on the southeast corner of Martin Luther King Boulevard and Alta Drive that they were willing to either lease or sell to the state. Dr. Brandenburg indicated that, from the Governor’s point of view, the location was immaterial; his first priority was to have the hospital built. Dr. Brandenburg indicated his preference was to place the hospital on the Southern Nevada Adult Mental Health Services (SNAMHS) campus because the PES facility would be a 24-hour-a-day, 7-day-a-week facility and would provide the ability to triage individuals from the hospital to outpatient services. Additionally, the site was close to the culinary area. Dr. Brandenburg indicated he was uncertain of the availability of any other sites on state lands.
Senator Cegavske asked that Division representatives work with her and Assemblywoman Pierce pertaining to concerns expressed by constituents whose residences were located near the SNAMHS campus. Senator Cegavske expressed her appreciation to Dr. Brandenburg for having Division representatives attend neighborhood meetings to exchange ideas concerning the new hospital.
In response to questions from Chairman Arberry concerning the Jones and Oakey site, Senator Cegavske indicated that constituents living in the area had expressed concerns about placing a new psychiatric hospital on the SNAMHS campus. Senator Cegavske explained that she and Assemblywoman Pierce had both listened to concerns that patients occasionally left the SNAMHS campus and roamed through their neighborhoods. Additionally, the neighborhood residents expressed concerns that patients of the new psychiatrist hospital would be “a more dangerous group.” Senator Cegavske extended her appreciation to Dr. Brandenburg for providing her the opportunity to look at the security system at the Dini‑Townsend Hospital.
Assemblywoman Giunchigliani expressed an understanding of neighborhood concerns but pointed out that the facilities from Jones Boulevard to Torrey Pines included the SNAMHS, the Community College of Southern Nevada, and the Clark County Library. Indicating that it made better sense to house the new psychiatric hospital within close proximity to the SNAMHS, Assemblywoman Giunchigliani said that patients leaving the confines of the hospital should be considered as a separate safety and security issue. Assemblywoman Giunchigliani addressed other possible sites including the “downtown corridor” and the medical facility that had been discussed by the mayor.
Dr. Brandenburg expressed agreement with Assemblywoman Giunchigliani and Senator Cegavske and referred to page 13 of the document titled Capital Improvement Project 03-C01 150 Bed Psychiatric Hospital (Exhibit D). Dr. Brandenburg pointed out the illustration of double doors between all interior and exterior entrances and exits to the building. Dr. Brandenburg advised that the new hospital would prove even more secure than the Dini-Townsend Hospital. Dr. Brandenburg explained that there had been some elopements from the current hospital because it was not designed in either a therapeutic or secure, safe manner. Dr. Brandenburg indicated that he was fairly certain that once he had an opportunity to present the new design, which he indicated was “extremely safe and very, very secure,” the neighborhood community would be pleased and would feel more secure.
Assemblywoman Giunchigliani asked Dr. Brandenburg if, at some point in the future and as a separate issue, a remodel of the doors with different security locks at the current facility could be accomplished to assist Senator Cegavske and Assemblywoman Pierce’s constituencies.
Dr. Brandenburg responded that the State Public Works Board had reviewed the issue of the doors and security locks for the last two bienniums, and some work in that area had been accomplished. However, Dr. Brandenburg indicated that there were several wards in the current hospital that would require extensive remodeling.
Assemblywoman Giunchigliani questioned whether an appraisal had been conducted for the property on which the current SNAMHS buildings were located in order to assess the trust fund payment for the land.
Mr. O’Brien deferred to Pamela Wilcox, Administrator, Division of State Lands.
Ms. Wilcox advised that an appraisal was done in 2001 on a smaller portion of the north end of the property, which appraised at $15 a square foot. Since a new appraisal had not been conducted on the site for the new psychiatric hospital, “a rough rule of thumb” was being used, but a more accurate appraisal would be required.
In response to questions from Assemblywoman Giunchigliani concerning the appraisal and the size of the property, Ms. Wilcox advised that the property consisted of 11 acres, and staff would be provided a copy of the appraisal.
In response to a question from Assemblywoman Giunchigliani concerning whether the trust fund for the land on which the current SNAMHS buildings were located had been paid, Ms. Wilcox indicated the trust fund would be paid after the appraisal, which would take a few months because it could not be accomplished until there was a budget for the project to be charged against.
In response to a question from Assemblywoman Giunchigliani concerning whether it was expected that the appraisal would be larger than the previous appraisal, Ms. Wilcox responded that a larger piece of property would appraise for less per square foot.
Mr. O’Brien mentioned that since the SNAMHS property was zoned residential, SPWB would appear before the Planning Commission on April 10, 2003, and before the City Council on April 17, 2003, to discuss a zone change only. Mr. O’Brien advised that a special use permit would have to be applied for, and during that time, many of the neighborhood concerns would be heard. Mr. O’Brien indicated that staff would be in attendance to address neighborhood concerns, and to provide information on the type of security that would be provided. In reference to Building Number 3, Mr. O’Brien said the older facility had areas that needed attention and could be taken care of.
Chairman Arberry questioned whether representatives of the Division of Mental Health and Developmental Services had an estimated budget to operate the facility once it was completed.
Dr. Brandenburg responded that he did not currently have a cost but would “sit down with staff,” and if staffing was approved for 150 beds, operating costs could be determined within a week or two.
Based on previous conversations concerning construction funds that would not be expended until fiscal year 2006, Chairman Arberry questioned whether the construction of CIP 03-C1 could be deferred until the 2005 Legislative Session.
Mr. O’Brien responded that the schedule for CIP 03-C1 reflected that the project would be bid in July 2004, bids would be opened in August, and award made in September. With 16 months of construction time and completion scheduled for January 2006, Mr. O’Brien advised it would be necessary to have the project funded during the 2003 Legislative Session.
Rick Combs, Deputy Fiscal Analyst, Fiscal Analysis Division, LCB, questioned whether the cash flow statement included in the CIP binder had been updated because the statement reflected that only about $2 million would be spent during the current biennium, and the remainder of the funding would not be expended until fiscal year 2006.
Mr. O’Brien advised that the cash flow statement would be updated and provided to staff by Friday, April 4.
Chairman Arberry indicated the SPWB’s presentation of new information to staff just prior to a hearing presented a problem for staff. Chairman Arberry requested that in the future, any information from the SPWB pertaining to a hearing had to be provided in enough time for analysis by staff prior to the hearing.
Mr. O’Brien advised that after the previous hearing, SPWB representatives immediately began reviewing the next round of projects, which resulted in the revisions transmitted to the Subcommittee’s staff on Friday, March 28, 2003. Mr. O’Brien indicated he wanted to ensure that the information provided to staff was adequate and correct. Mr. O’Brien assured the Chairman that staff would be provided any additional information required for a hearing in a timelier manner.
Chairman Arberry indicated that information pertaining to the projects should have been provided to staff by January 15, 2003, in order for them to provide the analysis required by the Subcommittee. The Chairman admonished the SPWB’s tardiness and emphasized that any information needed by the Subcommittee had to be provided to staff as soon as possible.
In response to a question from Chairman Arberry concerning whether the fees for the architect, who had designed the Dini-Townsend Hospital, could be negotiated, Mr. O’Brien advised that the SPWB would enter into negotiations with the architect, but there was no guarantee that the Board would approve “a direct select” appointment. Mr. O’Brien assured the Subcommittee members that a “smaller price” could be negotiated for the design work because of the availability of the floor plans. However, Mr. O’Brien indicated that additional work would be needed on the plans because of the mechanical systems, and he could not guarantee the cost until it was actually negotiated.
Chairman Arberry questioned whether the central kitchen for the SNAMHS would be capable of handling the 62 additional beds that would be added as a result of the project.
Dr. Brandenburg responded that the Mental Health and Developmental Services (MHDS) representatives were currently meeting with the vendor to ensure the central kitchen would be able to absorb 150 beds. Dr. Brandenburg explained that Mike Willden, Director, Department of Human Resources, was looking into turning Building Number 3, currently a hospital, into a long-term Alzheimer’s dementia unit once the new psychiatric hospital was built. Dr. Brandenburg indicated he needed a plan to ensure that the kitchen could support the 150 beds from the new hospital plus the 87‑bed hospital that would become a long-term Alzheimer’s dementia unit.
In reference to the issue of the architect’s fees, Assemblywoman Giunchigliani indicated she believed it was time to add language to Nevada Revised Statutes concerning the purchase of design plans. Assemblywoman Giunchigliani indicated that when the Dini-Townsend State Psychiatrist Hospital was built, it appeared likely that another psychiatric hospital would be built at some point in the future, and negotiations for the second set of plans could have been acted upon.
Mr. O’Brien expressed his understanding of the concern and recalled that during the 2001 Legislative Session, a bill, sponsored by Assemblyman Marvel, would have made plans by design professionals for public works projects the property of the state of Nevada. Design professionals were not in support of the action. Mr. O’Brien indicated there would be many issues involving such legislation that would require at least several days of discussion.
Assemblywoman Giunchigliani indicated that perhaps Assemblyman Marvel’s bill from the 2001 Legislative Session should at least be reviewed.
Assemblywoman Giunchigliani questioned the Board’s ability to effect the zone change and bid the project by July 2004 and asked what would happen if the zone change was not approved. Assemblywoman Giunchigliani also asked how it was possible for the SNAMHS facility to have been constructed on residential property.
Mr. O’Brien advised that quite often communities had properties that had been rezoned public when, prior to that, the property was in a community that had been zoned mixed or residential. Mr. O’Brien indicated that normally zoning priorities depended on how up-to-date the Planning Department was or how important the area was to them.
Assemblywoman Giunchigliani addressed the time line issue and indicated that it appeared if opposition to the zoning change occurred, the project could not be bid by July.
It was Mr. O’Brien’s opinion that any opposition to the project would occur during the request for a special use permit, and if the special use permit was not approved, other sites would have to be considered.
In response to questions from Assemblywoman Giunchigliani concerning the property at Jones and Oakey if the special use permit was denied, Mr. O’Brien indicated the property would remain in the school trust and would remain undeveloped.
In response to additional questions from Assemblywoman Giunchigliani concerning the zone change versus the special use permit, Mr. O’Brien explained the zone change would be applied for first and then the special use permit. Mr. O’Brien explained that if the property was rezoned from residential to commercial, a special use permit would be required because, in most cases, planning statutes or ordinances required that a public zone required a special use permit for any use of the property. In that way, the community was provided the opportunity to see what would be placed on the property. Mr. O’Brien advised that representatives of the Public Works Board, their consultant, and Human Resources would present the request for zone change and special use permit to the Planning Commission in southern Nevada.
In response to additional questions from Assemblywoman Giunchigliani in reference to neighborhood concerns, Mr. O’Brien indicated that information would be sent to the residents and community meetings would be held in order that discussions could take place. It was Mr. O’Brien’s opinion that the new hospital would be a nice addition to the SNAMHS campus and “much better” than Building Number 3 in which the current psychiatric hospital was located.
CIP 03-P04 - 50-BED FORENSIC FACILITY—FEASIBILITY STUDY—LAS VEGAS
Mr. O’Brien described CIP 03-P04 as an advance planning project for a 50-bed forensic facility. Mr. O’Brien advised that feasibility study monies were requested to develop a project program, size and scope of the work, evaluate various site location options, and determine a cost estimate for a new 50-bed forensic facility.
Dr. Brandenburg described Lakes Crossing Center as a maximum security forensic facility that provided services to those individuals who had been adjudicated as incompetent to stand trial, and after the current legislative session, not guilty by reason of insanity.
Dr. Brandenburg stated that Lakes Crossing currently had 48 beds and was the only facility the Division had that provided services statewide. Dr. Brandenburg said legislation, approved during the 71st Legislative Session, allowed the Division to conduct competency evaluations, which decreased the need for a new facility during the current biennium. However, Dr. Brandenburg indicated a need existed for advance planning. Options discussed by Dr. Brandenburg were:
Dr. Brandenburg indicated the 50-bed forensic facility was a complex issue because currently about 60 percent of admissions were from Clark County. While a forensic facility in Clark County could be filled, Dr. Brandenburg said that Reno and Sparks would be left with 60 percent less capacity.
Dr. Brandenburg indicated the Division would be working with the Department of Administration concerning the options to either expand Lakes Crossing, which would perhaps provide capacity for another two or three bienniums, or to actually conduct advance planning and build a forensic facility in Clark County.
In response to a question from Senator Mathews concerning the number of beds at Lakes Crossing, Dr. Brandenburg advised there were 48 beds, which currently covered the entire state. Dr. Brandenburg explained that because of legislation, approved during the 71st Legislative Session, staff at Lakes Crossing could conduct competency evaluations, which deceased the lag time between the time individuals were determined competent to the time they were transported to a court hearing.
Chairman Arberry questioned why 34.1 percent of the project costs were attributable to the Project Management and Inspection Fees.
Gustavo Nunez, Deputy Manager, Professional Services, SPWB, identified himself for the record and advised that the Project Management and Inspection Fees were developed “based on the effort” required to complete the project. Mr. Nunez indicated that he had reviewed the costs with respect to the project being fully funded to construction, and a 50‑bed forensic facility would constitute approximately 45,000 square feet. Mr. Nunez reviewed the following costs for a 45,000 square-foot facility, which included:
Mr. Nunez advised that one-third of $581,250, or the 5 percent normally charged by the SPWB, was approximately $64,000, and after reviewing the Project Management and Inspection Fees, $54,000 appeared reasonable.
Chairman Arberry questioned why “the performance of a feasibility study would cost the same as the advance planning through construction documents phase of a project.”
Additionally, Rick Combs, Deputy Fiscal Analyst, indicated the SPWB had submitted a revised project cost estimate that changed the scope of the project to remodel Building Number 3 to a request for feasibility study monies, and the total costs for the project remained the same. Mr. Combs reiterated the Chairman’s question concerning how the cost for a feasibility study could remain the same as a design that was ready to bid.
Mr. Nunez repeated his earlier explanation concerning his review of the Project Management and Inspection fees based on a fully funded project with a third of the costs designated for design and a third for feasibility, and he said that the fees appeared to be reasonable.
In response to a question from Senator Mathews concerning the total project cost of $11.5 million, Mr. Nunez reiterated that costs for a 45,000 square-foot facility at $225 a square foot was approximately $10 million and with site costs of $1.5 million, the total would be $11.5 million.
Chairman Arberry requested that SPWB representatives meet with the Subcommittee’s staff to provide clarification concerning the Project Management and Inspection fees.
Mr. Nunez indicated he would provide data on the actual number of hours estimated over a period of time rather than the 5 percent normally charged for a project.
Assemblyman Goldwater also expressed some confusion concerning the fees and questioned the need for a feasibility study Project Manager. Additionally, Assemblyman Goldwater pointed out that tacking percentages onto the various CIP projects was not a good way to fund the SPWB.
Mr. Nunez responded that a Project Manager would move the project through the consultant selection process, which normally took about three months, and from there the consultant would provide oversight and coordination with the agency to bring the project to its conclusion.
Mr. O’Brien agreed with Mr. Nunez concerning the duties of the Project Manager and addressed the cost of funding the agency. Mr. O’Brien pointed out that the SPWB had to be funded through the biennium and some of the projects would continue beyond the current biennium. Mr. O’Brien reiterated that the Project Management and Inspection Fees were based on one-third of $581,250, or the 5 percent normally charged by the SPWB, which appeared reasonable.
Assemblyman Goldwater expressed his understanding of the SPWB’s needs, however, indicated he could not agree with or support the “ticky-tacky little extras” added to the projects to fund the agency. Assemblyman Goldwater indicated the procedure made the Manager’s job, as well as the hearings more difficult and also made the job for the staff more difficult. Assemblyman Goldwater encouraged the SPWB representatives to spend the time to determine what they needed to fund the agency’s budget so that the Subcommittee could fund the projects for what they actually cost.
Mr. O’Brien indicated the concern centered on the cost of staff coordinating a feasibility study, and while he disliked having to argue about Project Management and Inspection Fees, he said the problem was that the agency had to be funded for two years, and projects that extended beyond the two years needed a residual.
Assemblyman Goldwater expressed his understanding of the situation, however, reiterated that increasing the projects by percentages in order to fund the agency could not be supported. Assemblyman Goldwater indicated that the Board’s constraints were understood but at some point the SPWB had to request what was needed to support the agency’s budget. With no reflection on Mr. O’Brien or the Board, Assemblyman Goldwater said the process of “ticky-tacky” budgeting had become increasingly difficult over the years.
Mr. O’Brien responded that he had put forth a challenge to everyone in the SPWB agency to develop a better process. Mr. O’Brien indicated the agency needed to define their weak points and a funding procedure for the agency, and then attempt to fill in the gaps in a manner that everyone could understand.
Senator Rawson agreed with Assemblyman Goldwater’s comments and indicated that the same “frustrating” discussion had taken place for 18 years and until some agreement could be reached on how to fund the agency, the discussion would just continue. However, Senator Rawson indicated he was ready to move on to the next discussion.
CIP 03-C17 - METAL BUILDING — CALIENTE YOUTH CENTER
CIP 03-C17 was described as a project to remove an existing triple-wide mobile home at the Caliente Youth Center and to replace it with a 3,000 square-foot metal building to house various recreational activities for the center’s residents.
Senator Rawson noted that the project cost estimate included a $20,000 line item entitled “Site Utilities,” and questioned whether the existing mobile home had utility services.
In a brief overview, Mr. O’Brien advised that while the triple-wide mobile home had utilities, typically adjustments, such as relocating the sewer and power lines, would be required.
Ward Patrick, Chief of Design, State Public Works Board, provided information from the agency concerning the utilities and reported the following:
Senator Rawson questioned whether the recreational equipment, necessary for the building, would be provided by the Caliente Youth Center.
Steven Rowe, Facilities Supervisor, Caliente Youth Center, testified the recreational equipment would be provided by the Caliente Youth Center and would include no extra costs.
CIP 03-M06 - PROVIDE SECURE EGRESS AREA—SNAMHS BUILDING 3A
Mr. O’Brien testified that CIP 03-M06 would provide a safe and secure exit and egress enclosure for Building Number 3 at the Southern Nevada Adult Mental Health Services campus. There had been several occasions when some of the patients had departed the facility, and installation of equipment to secure the exit was required. Additionally, Mr. O’Brien indicated that the improvements would meet State Fire Marshal and Bureau of Licensure requirements.
Senator Rawson noted that the project cost estimate included approximately $3,300 of furnishings and questioned the need for furnishings since the project was to provide a secure exit from the facility.
Mr. O’Brien advised that he would review the project and provide the information to staff.
CIP 03-M30 - PAINT BUILDINGS — SNAMHS
Mr. O’Brien reported that CIP 03-M30 would provide funding to patch, repair, and paint 90,000 square feet of exterior surfaces, doors, and trim, and 179,000 square feet of interior space, including doors and trim for Buildings 1, 2, 3, 3A, and 6 on the Southern Nevada Adult Mental Services campus in Las Vegas.
Mr. O’Brien explained that painting was typically a maintenance item. However, because of a lack of maintenance funding, discussion at a previous hearing addressed placing work, such as painting buildings, in the Capital Improvement Program (CIP).
Senator Mathews questioned the use of General Obligation Bond funding to paint buildings.
Mr. O’Brien indicated the concern was that because there was no General Fund money in the Capital Improvement Program, the only other funding source for painting projects was under the Capital Improvement Program, which was funded with General Obligation Bonds. Mr. O’Brien further advised that the agency had requested the project through the Capital Improvement Program because their maintenance budgets were not funded for painting buildings.
Senator Rawson requested staff to review the short-term projects that were being bonded and to provide a figure for what the General Fund dollars would be.
Mr. O’Brien advised the members of the Subcommittee that he had recently learned that some of the bonds used to fund the projects were short-term bonds that were paid off within five years. Mr. O’Brien indicated the use of such bonds to fund some of the projects for which the cost of the maintenance work was really short term might be the right direction to take.
Senator Mathews agreed with Senator Rawson’s request to have staff review the short-term projects that were being bonded and provide the information to the members of the Subcommittee. Senator Mathews indicated that even using short-term bonds to finance repairs and maintenance was not a good idea.
Mr. O’Brien agreed that it would be ideal to pay for painting and maintenance projects with money in the bank.
CIP 03-M55 - UPGRADE AIR HANDLERS IN ADMINISTRATION BUILDING — SNAMHS
Mr. O’Brien advised the members of the Subcommittee that CIP 03-M55 would replace the existing air handling units, chiller, and pumps that served the Administration Building at the Southern Nevada Adult Mental Health Services complex. The existing equipment was over 30 years old and had reached the end of its life expectancy.
Mr. O’Brien pointed out that the construction cost breakdown included the cost of the equipment, as well as the cost of the installation.
Chairman Arberry questioned whether the current air handlers could last another three or four years.
Mr. O’Brien indicated it would be prudent to look ahead because if the SNAMHS unit failed, it would be difficult to replace. However, looking at the project’s relatively low ranking on the agency’s priority list, Mr. O’Brien agreed it was possible to defer the recommendation to upgrade the air handlers.
Chairman Arberry requested a breakdown on the annual cost of repairs in recent fiscal years.
Mr. O’Brien agreed to provide the information requested by the Chairman.
In reference to deferring projects, Mr. O’Brien asked that the record reflect the concern that if bonding capacity was used for projects that were deferred to the next biennium, the funding would not be available for projects in the first year of the next biennium. Mr. O’Brien pointed out that the Governor recommended that CIP projects would be funded through the additional penny tax, which was the reason there were so many maintenance projects included in the Capital Improvement Program.
In response to a request for clarification from Assemblyman Goldwater, Mr. O’Brien indicated that a cash flow statement had been prepared looking at the bonding capacity over the next few years, and with the CIP being bonded for three years, the first year of the next biennium had no new funding.
Assemblyman Goldwater questioned when the extra penny of property tax recommended by the Governor would be levied.
Mr. Combs responded that the Governor had recommended levying the extra penny for fiscal year 2004, on July 1, 2003.
In response to Assemblyman Goldwater’s request for additional clarification on the authority for the extra penny, Mr. O’Brien explained, for example, that if Phase III of the High Desert State Prison project had not been canceled, there would be no bonding capacity available for new projects in the first year of the 2003‑2005 biennium. Bonding capacity would not be available until the second year of the biennium.
In response to additional questions from Assemblyman Goldwater concerning whether the bonding capacity had been “over committed,” Mr. O’Brien explained that the bonding capacity was available to implement Phase III of the High Desert State Prison, when the 2001 Legislature approved that project, but reducing the size of the project allowed for that bonding capacity to instead be used in the first year of the 2003-2005 biennium. Additionally, Mr. O’Brien said that in developing the Capital Improvement Program for the 2003-2005 biennium, if the High Desert Project had not been canceled, there would have been very little bonding capacity available to begin projects in the first year of the biennium, and although the bonding capacity had not been over committed, the cash from the sale of bonds in that next year would not have been available.
Maud Naroll, Chief Assistant, Budget and Planning Division, Department of Administration, identified herself for the record. Ms. Naroll explained that beginning with the 2001 Capital Improvement Program, the actual cash flow needs of different projects were reviewed and it was determined that projects, such as the High Desert State Prison or the new psychiatric hospital, would not be completed within one biennium. Using the psychiatric hospital as an example, Ms. Naroll explained that in the first year of the 2005-07 biennium, the contractor who constructed the hospital would still be receiving payments using some of the bonding capacity for the first year of the 2005-07 biennium. Ms. Naroll indicated there were other projects like that as well.
In response to questions from Assemblyman Goldwater concerning cash flow, Mr. O’Brien agreed that there was at least a cash flow lag of one year.
Ms. Naroll agreed and explained that while the cash flow statement would probably be revised, many of the projects contained within the 2003 CIP would be continuing in the first year of the 2005-07 biennium, and, therefore, most of the bonding capacity currently projected in that year would be taken up by those projects.
Mr. Combs indicated that during the 71st Legislative Session, the concept of issuing bonds over a three-year period was approved because typically construction projects took at least three years to complete. Mr. Combs explained that the cash flow analysis in the 2003-2005 CIP binder showed that funding for many of the maintenance projects would be expended in fiscal year 2006. Staff questioned why the authority for those projects should be approved during the current legislative session rather than during the next biennium when General Fund money might be available through one-shot funding or operating funding. Mr. Combs indicated that funding maintenance projects with cash was considered a more appropriate method of funding rather than the use of general obligation bonding.
CIP 03-M56 - REPLACE CARPET AND TILE — MAIN CAMPUS BUILDING — SNAMHS
With approval of the recommended funding, CIP 03-M56 would replace the carpet and tile in the main campus buildings on the SNAMHS campus in Las Vegas.
Mr. O’Brien advised the members of the Subcommittee that the project was considered short-term, and there had been some discussion concerning possible delegation of authority if funding for the project was approved. Mr. O‘Brien explained that the delegation of authority would allow the agency to utilize the services of the State Purchasing Division to enter into a contract with a local distributor for the installation of carpet and tile work, essentially removing the SPWB Project Management from the mix. Mr. O’Brien indicated that removing the SPWB’s involvement would actually save some dollars because the Purchasing Division could deal directly with the agency.
Chairman Arberry noted that the agency had ranked the carpet replacement project 63rd out of 72 on their priority list and questioned whether the existing carpet could be “stretched to eliminate the tripping hazards.”
Mr. O’Brien indicated the carpet problem could be addressed with duct tape, as had other carpeting problems throughout the state. However, Mr. O’Brien pointed out that the direction of the recommendations for the Capital Improvement Program was to include the state’s maintenance needs.
In response to a request from Chairman Arberry, Mr. O’Brien agreed to provide information on the number of square feet and the cost per square foot of the tile to be replaced.
CIP 03-M57 - REMODEL BATHROOMS—SNAMHS
Mr. O’Brien indicated that there were approximately 50 bathroom and shower room facilities located in Buildings 1, 2, 3, and 3-A at the SNAMHS. Many of the rooms were located in buildings that were 30 or more years old with little refurbishing of the bathrooms and shower rooms during that period. Mr. O’Brien defined the condition of the rooms as being “very bad.” Additionally, Mr. O’Brien indicated that the Bureau of Licensure had recently cited some of the facilities “because the staff could not maintain them in a safe, sanitary, and hygienic condition.” It was Mr. O’Brien’s opinion that the project should be funded in the Capital Improvement Program.
There were no questions from the members of the Subcommittee.
CIP 03-M74 CONSTRUCT PATIOS—SNAMHS
Mr. O’Brien indicated there were several areas at SNAMHS that were within the existing patio enclosures of Buildings 3 and 3-A that did not provide a safe and useable walking surface. Mr. O’Brien indicated the walking surfaces had deteriorated to such an extent as to prove a safety hazard to the patients.
There were no questions from the members of the Subcommittee.
CIP 03-M7 - PANIC ALARM BUILDING #25—NNAMHS
Mr. O’Brien advised the members of the Subcommittee that funding had not been provided for an emergency call system at the Dini‑Townsend Psychiatric Hospital, and CIP 03-M7, if funded, would provide a panic alarm for Building Number 25. Mr. O’Brien explained that staff would use the proposed “Scan Pen system” to send a signal for assistance in the event of an emergency situation. Mr. O’Brien advised that the hospital had indicated the system was a necessity for security purposes.
Chairman Arberry noted the project was ranked 58 out of 72 by the Department of Human Resources and questioned why such a low priority was given to a project defined as a life-safety issue. Additionally, Chairman Arberry noted that CIP 03-M64, a project to remodel a serving kitchen at the Lakes Crossing Center, received a higher priority.
Dr. Brandenburg responded that there were extensive leaks in the kitchen at the Lakes Crossing facility on the Nevada Mental Health Institute campus. Dr. Brandenburg explained that the kitchen’s concrete floor was poured in the 1950s and the pipes underneath the concrete had deteriorated which allowed steam escaping from the pipes to crack the concrete. Dr. Brandenburg reported that the Joint Commission on Accreditation of Health Care Organizations (JCAHO) cited the hospital on the issue during the certification process. Dr. Brandenburg stated that the kitchen at Lakes Crossing was the number one priority.
In reference to the Dini-Townsend Hospital, Dr. Brandenburg indicated that preliminary planning had included a panic alarm system, but the system had been “value engineered” out of the plans because of limited funding. With the conduit for the alarm already in place, Dr. Brandenburg indicated the priority for the alarm systems was just under the priority ranking for the hospital.
Chairman Arberry indicated that perhaps the project should be provided a higher priority.
Dr. Brandenburg responded that the first buildings at NNAMHS were constructed during the 1800s and others were built in the 1920s, 1930s, and 1940s. Dr. Brandenburg asked for the Subcommittee’s understanding and consideration of the difficult decisions faced by Department staff in situations ranging from life-safety issues versus a steam leak cracking the floor in the kitchen, which threatened the hospital’s accreditation.
In consideration of the important life-safety and accreditation issues, Chairman Arberry indicated the problems would have to be resolved.
Chairman Arberry questioned why the furnishings and equipment costs were required when the construction cost breakdown indicated that all materials were included in the estimate.
Mr. O’Brien advised the Chairman he would meet with the Project Manager to determine why the construction cost breakdown reflected costs for furnishings and equipment.
CIP 03-M31 – HVAC AND PLUMBING UPGRADES – NNAMHS
Mr. O’Brien reported that CIP 03-M31, if funded, would upgrade the existing heating, ventilation, air conditioning (HVAC), and plumbing piping systems in the Central Kitchen Building, Building Number 10, at the Nevada Mental Health Institute in Sparks. A revised project cost estimate was provided to the Subcommittee’s staff, which increased the cost from $168,906 to $479,451. Mr. O’Brien explained that after going back to the facility and closely inspecting the construction needs, the estimate increased essentially as a result of the required plumbing upgrade. Mr. O’Brien explained that the original funding for the project would have been inadequate, and the project would have either been abandoned or additional funding would have been requested. Mr. O’Brien explained that the revised cost estimate was more conducive to ensuring a successful project.
Chairman Arberry questioned whether the Governor had approved the revised project cost estimate.
Mr. O’Brien responded that while he could not speak for the Governor, the Governor’s Office had been contacted regarding the revision. Mr. O’Brien explained that another project’s scope had been reduced to stay within the Governor’s recommended CIP. Mr. O’Brien further advised that the Governor provided the SPWB the latitude to move project cost estimates around as necessary.
In response to Chairman Arberry’s question concerning the additional cost and how the funding would be provided for CIP 03-M31, Mr. O’Brien explained that funding would be provided from CIP 03-M62, an HVAC upgrade that had been reduced to design only. The revision provided a large savings after the project was reduced from $402,000 to $49,000.
CIP 03-M58 - HVAC SYSTEM UPGRADES—NNAMHS
CIP 03-M58, if funded, would upgrade most of the existing HVAC system in the Adolescent Services Building, Building Number 9, at the Nevada Mental Health Institute in Sparks. Mr. O’Brien stated that the existing equipment was approximately 30 years old, and a revision to the project cost estimate increased the project by $60,000. The additional funding would provide for “new gas piping, service,” and “architectural modifications for central plant equipment.”
Based on the Chairman’s earlier request, Mr. O’Brien advised that the SPWB could provide information on operating and repair costs for the system.
Chairman Arberry requested information on how the additional costs would be funded.
Mr. O’Brien responded that he believed the $60,000 in additional funding would be provided through “the total overall balancing of the increases and decreases.”
In response to a request by the Chairman, Mr. O’Brien agreed to confirm to staff how the additional costs would be funded.
CIP 03-M59 - HVAC SYSTEM UPGRADES—NNAMHS
CIP 03-M59, if funded, would replace most of the existing HVAC system in the Outpatient Services Building, Building Number 4, at the Nevada Mental Health Institute in Sparks. The existing equipment was approximately 30 years old. Mr. O’Brien explained that the Governor originally recommended $880,863 in General Obligation Bond funding, which was later reduced to $683,233. Mr. O’Brien indicated that the project, which originally had a construction estimate of $683,233, was reduced to $460,000, which provided the SPWB additional flexibility to increase other project cost estimates.
In response to a question from Chairman Arberry, who asked whether the total for HVAC systems should be adjusted, or whether the square footage or the cost per square foot should be adjusted, Mr. O’Brien advised that cost should be $20 per square foot.
CIP 03-M60 - BUILDINGS 3 AND 4 RENOVATIONS—NNAMHS
CIP 03-M60, if funded, included the renovation of Buildings 3 and 4 at the Nevada Mental Health Institute to provide for more effective outpatient services in conjunction with Building Number 5, which was remodeled in 1999. Mr. O’Brien advised that the project had been requested over three bienniums as individual projects and was rolled together for the 2001-2003 request. Mr. O’Brien advised the members of the Subcommittee that the project was being requested again for the fifth biennium.
Mr. O’Brien described Buildings 3 and 4 as old buildings with single-pane windows, “restrooms that were once used in an institutional gang-type setting,” and were deteriorating beyond repair, and plumbing fixtures and shower leakage that had caused water damage to floors below.
Mr. O’Brien indicated that interior upgrades would provide new flooring, new ceilings, reconfigured bathrooms, new paint or wall coverings for the walls, and upgraded lighting. Mr. O’Brien said that modifications to the HVAC system and a breakdown were provided in the construction cost estimate.
Chairman Arberry recessed the meeting at 9:36 a.m. The Chairman reconvened the meeting at 9:53 a.m.
Maud Naroll, Chief Assistant, Budget and Planning Division, advised that during the break she had spoken to John P. Comeaux, Director, Department of Administration. Ms. Naroll reported that Mr. Comeaux pointed out that while funding the maintenance projects with bond proceeds was not ideal, it was less ideal to wait until the cash was available and buildings had disintegrated to the point where it would not be feasible to maintain them. Additionally, Ms. Naroll reported that Mr. Comeaux was not optimistic that “a pot of cash” would be available “under the next biennium’s rainbow.” Ms. Naroll recalled that in 1995 after the last recession, there was not a huge availability of funding.
CIP 03-M61 - HVAC SYSTEM UPGRADES—NNAMHS
CIP 03-M61, if funded, would upgrade existing heating and cooling units in the Administration Building, Building Number 1, at the Nevada Mental Health Institute in Sparks. Mr. O’Brien advised the members of the Subcommittee that the equipment was approximately 30 years old.
Mr. O’Brien pointed out that the budget for CIP 03-M61 had been increased from original construction costs of $283,000 to $386,779, balancing the project with the other adjusted projects.
There were no questions from the members of the Subcommittee.
CIP 03-M63 - RENOVATE CENTRAL KITCHEN—NNAMHS
CIP 03-M63, if funded, would provide for the “rehabilitation of the central kitchen in Building Number 10 at the Northern Nevada Adult Mental Health Services (NNAMHS) campus to meet contemporary standards and to continue to provide quality food service to the campus including the new hospital, Sierra Regional Center, and other state and tenant agencies.
Chairman Arberry questioned whether all the projects for Building Number 10 at the Northern Nevada Adult Mental Health Services could be combined.
Mr. O’Brien responded that multiple projects in Building Number 10 could be combined.
CIP 03-M08 - UPGRADE ELECTRIC STRIKE SYSTEM — DESERT REGIONAL CENTER
CIP 03-M08, if funded, would upgrade the electric strike door-release system in Buildings 1300, 1301, 1302, 1304, 1306, 1307, 1308, 1309, and 1310 at the Desert Regional Center, MH&DS in Las Vegas.
Refer to narrative under CIP 03-M09.
CIP 03-M09 - INSTALL ELECTRIC KEY-CARD SECURITY DOOR LOCKING
CIP 03-M09, if funded, would install electronic key-card security door locking for buildings at the Desert Regional Center, MH&DS in Las Vegas.
Chairman Arberry questioned whether CIP 03-M08 and CIP 03-M09 could be combined.
Mr. O’Brien agreed to review combining the projects as suggested by the Chairman.
CIP 03-M26 - RENOVATE POOL—CALIENTE YOUTH CENTER
CIP 03-M26, if funded, would renovate the existing 38-year-old pool facility at the Caliente Youth Center for use by the youth residents. Mr. O’Brien indicated that the plumbing and heating systems were failing and the concrete apron was also cracked as a result of “frost heave.”
In response to a question from Chairman Arberry concerning the availability of the pool for the summer of 2003, Mr. O’Brien indicated he was not optimistic the pool would be operational during the summer.
Mr. O’Brien visited the facility during the previous summer and advised the members of the Subcommittee that the pool provided recreational activity for the youth staying at the Caliente Youth Center. The original request for renovation would have enclosed the pool, which would have provided year‑round activity, but would have significantly increased the cost of the project.
Mr. O’Brien discussed the costs to renovate the pool versus new construction, which he said would be dependent on detailed cost estimates. Mr. O’Brien said that costs to repair the pool and apron were estimated at approximately $207,000, which was an indication that it might be less expensive to construct a new pool, an option that would be reviewed. Mr. O’Brien explained that the pool currently was not operational because it could not be heated.
Senator Rawson mentioned constructing an enclosed pool using perhaps an inflatable cover. Since the Caliente Youth Center was located in an isolated area of Nevada, Senator Rawson stated that the use of a pool for most of the year would be worthwhile, and he requested that a cost estimate be prepared.
Mr. O’Brien agreed to explore the construction of an enclosed pool with a less permanent type of cover. Additionally, Mr. O’Brien reiterated that he would like to look into the cost of new construction, which he indicated might be less expensive than trying to renovate the current pool. Mr. O’Brien advised that the cost of a pool with a permanent type cover had been previously examined, and the costs were prohibitive. Mr. O’Brien advised that he would provide cost information on both a permanent and less permanent type of enclosure.
Senator Rawson commented that it would be less expensive to heat a covered pool. After visiting the facilities, Senator Rawson said he had been impressed by the administration’s maintenance efforts and that they had “made do” for years. Additionally, Senator Rawson indicated that the residents of the Caliente Youth Center had been involved in many important projects in that part of the state and had provided valuable work for many of the state’s parks, especially Kershaw-Ryan State Park located two miles south of Caliente.
CIP 03-M27A - HOT WATER TANKS—CALIENTE YOUTH CENTER
CIP 03-M27A, if funded, would replace the original water heater systems in the seven dormitory units at the Caliente Youth Center. Mr. O’Brien said the new water heaters would provide more efficient use of energy, and flow restrictors would be added to current showers and building fixtures to reduce water consumption.
Mr. O’Brien indicated the agency had explored the idea of replacing some of the water heaters using funds from their operating budget because of a concern that this project had fallen through the cracks and had not been included in the Capital Improvement Program. A SPWB review revealed that extensive work was required that included:
In reference to the construction cost breakdown, Chairman Arberry questioned the need for approval of miscellaneous costs when a construction contingency had already been included.
Mr. O’Brien responded that he believed after taking a “quick look” at what was necessary, the miscellaneous costs were included as an additional contingency. However, at the Chairman’s request, Mr. O’Brien agreed to review the miscellaneous costs.
The Chairman questioned why security costs were budgeted for the project when security costs were not budgeted for other projects at the Caliente Youth Center.
Mr. O’Brien indicated he believed that the Project Manager wanted to secure the facility since there was limited access at the Caliente Youth Center. However, Mr. O’Brien agreed to check with the agency to determine whether security costs needed to be included in the construction cost breakdown.
Chairman Arberry questioned how the costs for overhead and profit and remote site location were determined.
Mr. O’Brien advised that the costs were based on a percentage used by the SPWB, which Mr. O’Brien indicated could be verified.
Mr. O’Brien agreed to Chairman Arberry’s request that the information concerning the costs for overhead and profit and remote site location be provided to staff.
Senator Rawson requested that the use of solar components for the Caliente Youth Center be investigated. Senator Rawson indicated that while solar components would add some costs initially, savings might be realized in future fuel costs.
Mr. O’Brien agreed to investigate the use of solar components.
CIP 03-M64 - REMODEL KITCHEN, REPLACE EQUIP., UPGRADE FLOOR & BATHROOM—LAKES CROSSING
CIP 03-M64, if funded, would remodel the serving kitchen at the Lakes Crossing facility with upgraded commercial equipment to meet health and sanitation codes, remove the exposed aggregate floor and planter in the dayroom for safety reasons, and construct a bathroom that met the Americans with Disabilities Act (ADA) requirements.
Senator Rawson questioned whether the project cost estimates were up‑to‑date.
Mr. O’Brien advised that he would determine the availability of a breakdown based on the construction costs and provide it to staff.
CIP 03-M73 - MAINTENANCE SHOP AND ISOLATION ROOM—LAKES CROSSING CENTER
CIP 03-M73, if funded, “would include the construction of a maintenance shop, with storage space, and an isolation room,” at the Lakes Crossing Center. “The isolation room would be for clients with infectious diseases, such as tuberculosis, and is a requirement for the facility to upgrade its present license to a psychiatric hospital license. Lakes Crossing Center would like to upgrade its license to improve the quality of its care.”
Chairman Arberry asked the Board to provide a revised project cost estimate that included the square footage of the area that would be remodeled.
Additionally, Senator Rawson requested that the SPWB provide information on the furnishings and equipment that would be purchased for the project.
Mr. O’Brien agreed to provide the information on the revised project cost estimate requested by the Chairman and a list of the furnishings requested by Senator Rawson.
CIP 03-P5.5 - NORTHERN NEVADA VETERANS’ HOME — FEASIBILITY STUDY
Mr. O’Brien advised that CIP 03-P5.5, if funded, would provide a study to determine the feasibility of placing a Veterans’ Home in northern Nevada. Although no specific sites had been determined, Mr. O’Brien advised that discussion had taken place with representatives of Carson Tahoe Hospital concerning the availability of the facility after the new hospital was built. Mr. O’Brien advised that statistical data was being reviewed to determine the financial viability of placing a Veterans’ Home in the northern part of the state.
Comparing the Veterans’ Home in southern Nevada to a “black hole,” Assemblyman Goldwater asked if “nothing” had been learned from that experience and indicated that perhaps the “University Astronomy Department” should conduct the feasibility study.
Charles Fulkerson, Executive Director, Office of Veterans’ Services, identified himself for the record and indicated he did not understand Assemblyman Goldwater’s remarks.
Assemblyman Goldwater recalled the difficulties encountered with the construction problems and the enormous amount of money that had been spent on the Veterans’ Home in southern Nevada. Assemblyman Goldwater also mentioned that veterans’ groups had indicated the facility was “not what they wanted,” and that it was “terrible, unsafe, and unsanitary.” Mr. Goldwater expressed his reluctance to engage in approving a “repeat performance” in the north to fund a feasibility study.
Mr. Fulkerson indicated that while he had been living with the southern Nevada Veterans’ Home problems on a daily basis for three years, he believed that “some headway” was being made with the employment of an experienced administrator. Additionally, Mr. Fulkerson said there was “absolutely no substantiation” of accusations that the building in southern Nevada was unsafe, or unsanitary. Mr. Fulkerson said the mandate was to provide nursing home facilities for veterans in southern Nevada, and that was what they were trying to do.
Mr. Goldwater asked if the feasibility study was going to focus on a site or on the numbers of veterans who needed services.
Mr. Fulkerson envisioned that the feasibility study would determine the best site and the kinds of services needed. While the facility in Boulder City provided skilled nursing home care, Mr. Fulkerson indicated that perhaps a variety of different services would be “a better suit for another nursing home.“ Additionally, Mr. Fulkerson said there were enough veterans to make the Veterans’ Home in northern Nevada financially viable.
Assemblyman Goldwater questioned the necessity of building another Veterans’ Home facility and discussed the possibility of buying one.
Mr. Fulkerson agreed with the possibility of renovating an existing facility on a lease-type basis, an option that would save the state from having to provide millions of dollars worth of funding. Mr. Fulkerson indicated he had discussed that aspect with Mr. Frank Salvas, Chief of the state’s Home Grant Program. Mr. Salvas said the federal government would not have to fund millions of dollars in one lump sum, and renovating an existing facility would remove Nevada from beneath a $200 million construction backlog for other state nursing homes that while approved, lacked the necessary funding for construction.
Mr. O’Brien reiterated that the feasibility study would investigate the need, ensure financial viability, and also look at other facilities that perhaps the private sector could provide. Mr. O’Brien agreed that problems had been experienced with the Veterans’ Home in southern Nevada, but that the problems had been resolved and Mr. Fulkerson was in the process of staffing the facility.
Mr. O’Brien indicated that the issue of Carson Tahoe Hospital vacating their current facility peaked an interest because there was not much of a desire by the state to build a new Veterans’ Home. Mr. O’Brien indicated that utilization of an already built facility, or a facility built by the private sector that met the accreditation requirements, was what he envisioned the feasibility study would encompass. Mr. O’Brien indicated the study would not focus on building a facility funded by the state.
Mr. Goldwater expressed reluctance to spend additional monies during a period of financial crisis when funding was needed in so many areas, especially in the Capital Improvement Program.
Mr. O’Brien indicated that Mr. Fulkerson was looking toward the future needs of the veterans, and before planning for those needs, facts were needed. Mr. O’Brien reiterated that the federal government provided funding through grants, and if assistance was available through a grant that would be the way to go.
Mr. Fulkerson read the following statement into the record.
Nearly 25,000 veterans reside in and receive primary medical care in 114 State Veterans’ Homes. The aging population of 25,000,000 veterans is expanding the growing need for long term care. The Department of Veterans’ Affairs feels this need can be best met through expanding the role of State Veterans’ Homes and Contract Nursing Homes.
The 03 Nevada veterans population is over 241,000. Clark County and three nearby counties have about 180,000 veterans. That leaves about 61,000 in the 13 northern Nevada counties. In addition, there are over 35,000 veterans living in the northern and eastern counties of California who receive medical care from the VA Medical Clinic in Reno. The California veterans could be logical users of a nursing home located in north Nevada. Using the Department of Veterans’ Affairs guidelines of 2.5 nursing home beds per 1,000 veterans, there is a need of 152 beds for Nevada veterans, adding the 35,000 nearby California veterans the bed requirement is increased to 240.
This request for $50,000 is to study the financial viability of establishing a Veterans’ Nursing Home in northern Nevada. There is a possibility of the cost being much less. The study would probably be coordinated through the Department of Administration.
Senator Mathews mentioned a vacant nursing home facility at the corner of Mill and Yori Streets, which was within blocks of Washoe Medical Center.
While Mr. Fulkerson was unaware of the facility, he agreed that the possibility of assuming operation of a vacant nursing home was a viable alternative.
Senator Rawson also expressed his reluctance to spend General Obligation Bond money on a study and indicated such a funding plan was inappropriate. Senator Rawson said that there were probably other ways to fund the study. Additionally, Senator Rawson indicated he had questions about the Veterans’ Home nursing facility in southern Nevada that had to be settled before he would be willing to support another nursing home. It was Senator Rawson’s opinion that grants should be used to fund the study and reiterated that funding the study with General Obligation Bonds was inappropriate.
In response to a question from Chairman Arberry concerning the Veterans’ Home in southern Nevada, Mr. Fulkerson provided the following information:
Mr. Fulkerson explained that receiving accreditation would result in receiving $56.34 a day per patient provided by the federal per diem program retroactive to October 2002. While the skilled nursing home in southern Nevada was under its third administrator, Mr. Fulkerson advised that Gary Bermeosolo, the current nursing home administrator, retired after 18 years as Director of the Idaho Veterans’ Program, and he had successfully operated three nursing homes in Idaho. Mr. Bermeosolo was a licensed nursing home administrator who had the necessary experience to run the nursing home.
Chairman Arberry expressed his pleasure in hearing that Mr. Bermeosolo had been hired and hoped he would stay and make the veterans feel comfortable.
CIP 03-C09 - NORTH LAS VEGAS FIELD SERVICES OFFICE
CIP 03-C09, if funded, would provide for the construction of a 23,000 gross‑square-foot field services facility in North Las Vegas to replace the current Department of Motor Vehicles (DMV) facility on Carey Street.
In response to a question from Chairman Arberry concerning the location of the new office, Dennis Colling, Chief, Administrative Services Division, Department of Motor Vehicles, said the new facility would be located on Decatur just north of I-215.
Chairman Arberry asked if the property was owned by the state.
Mr. Colling responded that the Bureau of Land Management (BLM) was in the process of transferring the property to the state.
Chairman Arberry requested information on the reason a developer had provided $500,000 for the completion of the project.
Mr. Colling advised that the property the DMV representatives had originally decided on as the site of the new facility was adjacent to the current site on Decatur and I-215. A developer, who wanted to retain the original site, indicated they would pay for off-site costs to bring utilities within 100 feet of the adjacent BLM property and made a cash payment of approximately $600,000 to the state to assist with the development of the BLM property.
Mr. O’Brien indicated that the payment from North Valley Enterprises, the developer, was closer to $600,000, and the SPWB would appear at the next Interim Finance Committee to request use of those funds for professional services that included topographical maps of the location, surveys, remote site costs, and soil analysis.
Additionally, the project included a Commercial Driver’s License course (CDL), and Mr. O’Brien pointed out that CIP 03-M53, which had been withdrawn, had also included a CDL. Mr. O’Brien explained that the CDL course was originally placed at the Flamingo facility. However, because of neighborhood opposition to truck traffic, the CDL was included in the CIP 03-C09 project which provided a better location, and CIP 03-M53 was withdrawn.
Mr. Nunez advised that the $600,000 payment was based on a SPWB estimate provided to State Lands who had negotiated with the developer to determine the cost to provide all utilities within100 feet of the property.
Chairman Arberry asked if the site development costs, included in the project cost estimate, could be reduced by the amount of the payment received from the developer.
Mr. Nunez responded that the SPWB representatives had contacted the engineering company providing the off-site development for North Valley Enterprises to obtain information on the infrastructure, soils, and other information needed to more accurately determine what the costs would be.
Mr. O’Brien advised that the project cost estimate could not be reduced because the $600,000 would be used to improve the roadway including the curb, gutter, sidewalk, half-street paving, and extension of utilities. Mr. O’Brien reiterated that the SPWB would appear before the IFC to request authorization to accept the funds.
Senator Rawson noted that a revised project cost estimate reflected that $23,153 in bond sale costs had been shifted to the data/telecommunications line, which he indicated was not credible. Senator Rawson advised the SPWB representatives that unless they could show a compelling reason why the data/telecommunications line would cost exactly $23,153, it would not be approved.
In response, Mr. O’Brien advised that $23,153 was listed in the “bond sale,” however, there was no bond sale, and the Project Manager indicated that the cost for the data and telecommunications wiring was underestimated by several hundred thousand dollars. Mr. O’Brien advised that he had been unwilling to raise the budget by that amount and decided to include the $23,153 into the data and telecommunications wiring line item even though the Project Manager had indicated it was underfunded by several hundred thousand dollars. Mr. O’Brien indicated that the SPWB would have to work within the construction budget for that particular line item.
Senator Rawson expressed an understanding of the cost problems, however, reiterated that the tactic reflected a lack of credibility and a lack of confidence in the estimates. Senator Rawson asked if the DMV would be in the new facility by December 26, 2005, the date the lease on their current facility terminated.
Mr. Nunez responded that the schedule for completing the project was one of the reasons the Board would appear before the next meeting of the Interim Finance Committee. Mr. Nunez explained that the Board would request authority to expend a portion of the $600,000 from North Valley Enterprises in order to begin some of the preplanning work, such as, topography maps, soil surveys, and improvements of the off-site development. Mr. Nunez indicated that the schedule could be met, but that the SPWB would have to pay special attention to the project.
In response to a question from Chairman Arberry concerning the critical need for the project, Mr. Colling advised that the project had been brought forward for discussion within the Executive Branch prior to the 2001 Legislative Session, and it was determined at that time that the project could be brought forward in 2003 and completed by 2005.
Mr. O’Brien also advised that although the time frame was “tight,” the 2005 schedule would be met.
CIP 03-M32 - NEW COUNTERS AND EAST SAHARA DMV
CIP 03-M32, if funded, would remodel the lobby, customer information area, and counters at the DMV East Sahara office in Las Vegas. Mr. O’Brien advised that the planning and design for the last remodel was done in 1994-95, and the facility was remodeled in 1996. Mr. O’Brien further advised that the workstations did not provide sufficient room for DMV employees to perform their duties.
Chairman Arberry asked why it was necessary to remodel the facility again only seven years after it was last remodeled.
Mr. Colling advised that the Sahara office was remodeled prior to the reengineering of the Department’s processes and functions, and since that time period, a new functionality had been brought “on board” within the Department. Mr. Colling explained that the employees had “an extensive need for both computers and printers at individual counters.” Mr. Colling said that the counters currently in use in the other facilities that had been designed since DMV had gone online were significantly wider than the 48-inch counters at the Sahara office. Mr. Colling indicated that the employees in the Sahara office did not have the ability to work facing the customer continuously and had to turn either to the side or to the back to gain access to their money trays.
Ginny Lewis, Director, Department of Motor Vehicles, identified herself for the record and testified that all DMV metropolitan offices, including the Sahara office, had an information booth that each customer visited prior to receiving a Q-Matic ticket. Ms. Lewis explained that the Sahara office provided service to over 1,200 customers a day, and the information counter, located directly inside the front doors, created a huge bottleneck. Ms. Lewis advised that part of the remodel moved the information booth away from the front doors to try to ease some of the congestion.
Chairman Arberry suggested that input from employees should be received prior to renovation of facilities. Additionally, Chairman Arberry asked how construction would be completed without closing the office.
Mr. Nunez advised that the project cost estimate reflected that work on the project would take place in the evenings and on Sundays, and direction from the DMV was that the office would be operational during construction. Additionally, Mr. Nunez indicated that the construction work would be completed in two phases with part of the windows completed in one phase and the remainder in the next phase.
Chairman Arberry questioned if there was sufficient funding to complete the project in phases.
Mr. Nunez advised that the Project Manager had indicated allowances were made for the work to be completed in phases.
Chairman Arberry asked for a construction cost breakdown to be provided to staff.
Chairman Arberry noted that construction costs for the project would not be expended until fiscal year 2006 and asked why the Board did not anticipate beginning construction on the project until fiscal year 2006.
Mr. O’Brien indicated that the project would be funded from the state Highway Fund and indicated that perhaps the funding was inadvertently added to the cash flow table.
Mr. Combs verified that the funding did appear “in the cash flow table included behind the Executive Summary Tab in the CIP binder,“ which also indicated the construction costs for the project would not begin until fiscal year 2006.
Mr. O’Brien advised that he would review the issue and would provide the information to staff.
Chairman Arberry noted that the project description reflected that the work areas would be expanded from 48 inches to 70 inches to allow sufficient workspace for the employees and asked whether the number of counter slots would be reduced as a result of the decision to increase the size of the workspace.
Ginny Lewis explained that there were two pods in the Sahara office building that housed supervisors. The pods would be removed to accommodate the expansion of windows to the minimum of 70 inches and would come around to the walls on the side so that there would be no reduction in the windows. Ms. Lewis emphasized that it would never be DMV’s intent to reduce the number of windows at the Sahara office.
CIP 03-C15 – LAND ACQUISITION FOR A DMV OFFICE IN SOUTH RENO
CIP 03-C15, if funded, would provide state Highway Funds for the advanced planning and site acquisition for a full-service DMV office in south Reno.
Looking ahead with respect to the growth occurring in the south Reno area and the need for a DMV office, Mr. O’Brien indicated it was the SPWB’s recommendation to acquire the land now. State Lands had been negotiating with a landowner in the area, and it appeared that the land would be available for a little more than half the price of what State Lands believed the land was worth. With solid numbers in hand, Mr. O’Brien advised that a revised project cost estimate had been submitted, which included closing costs but removed some fees including Project Management and Inspection fees, which were not needed for land acquisition.
In response to Chairman Arberry’s question concerning the location of the property, Mr. O’Brien advised that the property was in the Double Diamond area, north of Zolezzi and east of the freeway.
Assemblywoman Gibbons indicated that the area Mr. O’Brien described was in District 25, the area she represented. In looking at ways to fund the budget and not impair education, Mrs. Gibbons asked the record to reflect her opinion that the time was not appropriate to buy property just to have it.
Mr. O’Brien advised that the project was funded from state Highway Funds, not funded from General Obligation Bond funding.
CIP 03-C22 – WEST FLAMINGO INTERSECTION PAYMENT
CIP 03-C22, if funded, would pay Clark County for a portion of the costs of intersection improvements that were made by Clark County near the DMV office on West Flamingo in Las Vegas.
Mr. O’Brien advised that a signed agreement dated March 11, 1994, between the State Public Works Board and the Clark County Department of Public Works, for improvements to the traffic signals, included a provision that once the billing was made to the state, the Public Works Board would request, if funds were available, to reimburse the $33,996 to Clark County. Mr. O’Brien advised that the state reimbursement was contingent on future legislative approval and appropriation, and the SPWB felt it was appropriate to bring the request before the Subcommittee.
There were no questions from the members of the Subcommittee.
Chairman Arberry noted that The Executive Budget recommended increasing the property tax from 15 cents to 16 cents in order to provide sufficient funding to service the debt for the Capital Improvement Program. It was Chairman Arberry’s understanding that the property tax increase did not include sufficient funding to service the debt for the Question 1 bonds approved by the voters in the November 2002 election.
Chairman Arberry advised representatives from the Budget Division that in the next two weeks, information would be required on the total property tax needed to finance the Governor’s recommended Capital Improvement Program for the 2003-2005 biennium, as well as the Question 1 bonds that would be issued.
Ms. Naroll confirmed that the additional one-cent property tax would cover the funding for the Capital Improvement Program projects, and indicated that the information on the Question 1 bonds would be provided to the Subcommittee.
In addition, Chairman Arberry asked for information on whether the Question 1 funding would be spent in phases or all at once.
Senator Raggio recognized students and their instructor from Dilworth Middle School in Sparks and welcomed them to the hearing.
Chairman Arberry adjourned the meeting at 10:53 a.m.
RESPECTFULLY SUBMITTED:
Connie Davis
Committee Secretary
APPROVED BY:
Assemblyman Morse Arberry Jr., Chairman
DATE:
Senator William J. Raggio, Chairman
DATE: