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

May 26, 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 5:42 p.m., on Monday, May 26, 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

Mr. Walter Andonov

Mrs. Dawn Gibbons

Ms. Chris Giunchigliani

Mr. David Goldwater

Mr. Richard Perkins

 

Senate COMMITTEE MEMBERS PRESENT:

 

Senator William J. Raggio

Senator Raymond D. Rawson

Senator Barbara Cegavske

Senator Bernice Mathews

 

COMMITTEE MEMBERS ABSENT:

 

None

 

STAFF MEMBERS PRESENT:

 

Mark Stevens, Assembly Fiscal Analyst

Gary Ghiggeri, Senate Fiscal Analyst

Rick Combs, Deputy Fiscal Analyst

Carol Thomsen, Committee Secretary

Connie Davis, Committee Secretary

 

Chairman Arberry called the meeting to order and asked Gary Ghiggeri, Senate Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau (LCB), to commence with the presentation regarding the projects within the Capital Improvement Program (CIP).

 

Mr. Ghiggeri referenced the packet entitled, “CIP Joint Subcommittee Recommended CIP Program for the 2003-05 Biennium,” Exhibit C, which compared the Governor’s recommendations and those of the Subcommittee, and was provided to the Subcommittee for its concurrence and/or review.   

 

Mr. Ghiggeri explained the differences depicted in Exhibit C:  

 

• Project Number 03-C6: Emergency Management, Carson City; new State Emergency Operations Center.  The Governor had recommended $7,071,365 to design and construct the facility.  The intention of the Subcommittee had been to provide funding for design only in the amount of $571,175.  The cost to construct the facility over the next biennium would be approximately $6.9 million and, of that amount, approximately $6.2 million would be funded through General Obligation Bonds and approximately $700,000 would be allocated from the Highway Fund. 
• Project Number 03-C7: Buildings and Grounds, Carson City; Phase II of the remodel of Building No. 17 at the Stewart Facility.  The project had been reduced slightly for duplicative HVAC maintenance agreement costs that were included in CIP Project Number 01-C11.
• Project Number 03-C9: Department of Motor Vehicles (DMV), North Las Vegas; new DMV Field Services Office.  The Governor had recommended $9.4 million and the revised recommendation provided by the State Public Works Board (SPWB) increased the cost to approximately $9.6 million.
• Project 03-C13: Department of Information Technology, Carson City; extend state’s communications backbone to the Stewart Complex.  The Governor had recommended $507,280, which was reduced slightly for elimination of plan checking costs.  The Subcommittee recommended a total of $505,324.
• Project Number 03-C15: DMV, Reno; advance planning and land acquisition for new DMV office in south Reno.  The Governor had recommended $5,840,523 and that amount had been reduced to $4,369,285, which would be funded from the Highway Fund. 
• Project Number 03-C17: Division of Child and Family Services, Caliente; new metal building for recreational use at Caliente Youth Center.  The Governor had recommended $487,154, which had been reduced to $464,065 based on elimination of weight lifting equipment.
• Project Number 03-C18: Department of Agriculture, Sparks; petroleum laboratory addition.  The Governor had recommended $1,106,023, which had been increased slightly based on the revised cost estimate provided by the SPWB.  The revised estimate was $1,216,582.
• Project Number 03-C19: Nevada State Museum, Carson City; improve Americans With Disabilities Act (ADA) access at Nevada State Museum.  The Governor had recommended approximately $287,885, however, staff would recommend that the project be funded through the statewide ADA program.  Funding for that project was available during the current biennium, while the construction costs identified for the project would not be available until FY2006.
• Project Number 03-C21: University and Community College System of Nevada (UCCSN), Las Vegas; construction of Health Sciences Building on the West Charleston Campus of the Community College of Southern Nevada (CCSN).  The funding mix had been adjusted slightly for the project based on a reduction of $102,202 for plan checking costs that were duplicative funds approved by the 2001 Legislature.
• Project Number 03-C51: Buildings and Grounds Division, Carson City; lease/purchase state office building for the Department of Conservation and Natural Resources.  The Governor had recommended $10.6 million for the project, however, the Subcommittee wanted to go forward with Project Number 03-C50 at $3.1 million, which was recommended by the Governor, and determine the success of that project.  If it were successful, an additional project would be pursued during the 2005 session.

Mr. Ghiggeri stated that completed his explanation regarding the construction projects.  He called the Subcommittee’s attention to the last two pages of Exhibit C entitled, “Priority of Maintenance Projects,” and explained that some adjustments had been made based on recommendations by the Subcommittee.  The shaded projects on that list were either low on the priority list, or were funded for construction costs in FY2006, and had been recommended for elimination at the present time. 

 

Chairman Arberry referenced additional CIP projects that would be added to the list as depicted in Exhibit D entitled, “CIP Additions,” which included: 

 

• Project Number 03-C91L: Desert Research Institute, Reno; Northern Nevada Science Center, Maxey Building renovations and addition.
• Project Number 03-C92L: Economic Development, Wells; purchase and renovation of 120 miles of Nevada Northern Railroad track.
• Project Number 03-C94L:  University of Nevada, Reno (UNR), Reno; campus-wide fire and life-safety retrofits.
• Project Number 03-C95L: UNR, Reno; land acquisition for women’s athletics program.
• Project Number 03-C96L: CCSN, Mesquite; renovation of the former Mesquite High School.
• Project Number 03-C97L: CCSN, various locations; security system and equipment upgrades at various campuses.
• Project Number 03-C98L: Great Basin College, Elko; establishment of Oral Health Clinic.
• Project Number 03-C99L: UNR, Las Vegas; School of Medicine study and design of heart transplant facility, and construction of embalming facility and plasticization lab. 
• Project Number 03-P10L: UNR, Reno; math and science center, programming, schematic design, and preliminary cost estimate.
• Project Number 03-P11L:  UNR, Reno; renovation of Getchell Library and programming.

 

Chairman Arberry asked whether there were comments from the Subcommittee regarding the additional CIP projects.  Ms. Giunchigliani pointed out that the breakout for Project Number 03-C99L would be $1.5 million for the study and design, and $200,000 for construction of the embalming facility and the plasticization lab. 

 

Senator Raggio noted that if the Subcommittee’s recommendations were followed for the projects listed in Exhibit C, it would free up the bonding authority to accommodate the additional CIP projects as depicted by Exhibit D.  The funding would remain within the 16-cent state property tax rate that was recommended by the Governor and, perhaps, might be somewhat less.  Mr. Ghiggeri concurred that it would be below the 16-cent tax rate. 

 

Senator Rawson reiterated that the additional projects for southern Nevada would include the projects for the renovation of the former Mesquite High School in Mesquite; the study and design of the UNR Medical School heart transplant facility, construction of the embalming facility and plasticization lab in Las Vegas; and the security system and equipment upgrades at various campuses of the CCSN.  Senator Rawson explained that the Oral Health Clinic project for the Great Basin College in Elko would operate under the auspices of the University of Nevada, Las Vegas (UNLV).

 

Senator Cegavske asked for clarification regarding the “other” funding sources referenced in the exhibits.  Mr. Ghiggeri reported that “other” funding would include Highway Fund money and private funds raised by the UCCSN; he noted that some internal service funds were funded via the agencies.  Senator Cegavske asked whether any General Fund money would be utilized.  Mr. Ghiggeri replied that no General Fund money would be utilized.  Senator Cegavske noted that the projects would be funded via the 1‑cent increase in property tax recommended by the Governor, which had not yet passed.  Mr. Ghiggeri explained that, historically, the property tax levy would be included in the Capital Improvement bill.  In order to stay under the 1-cent increase, Mr. Ghiggeri believed the projects listed would have to be reduced by $60 million. 

 

Senator Cegavske asked why some of the improvement projects at the Caliente Youth Center had been eliminated, as depicted in Exhibit C.  Mr. Ghiggeri advised that some of those projects were very low on the priority list compiled by the State Public Works Board (SPWB).  Also, the construction of those projects was not scheduled to begin until FY2006 when, hopefully, the state would have surplus cash to fund the routine maintenance projects rather than bonding those projects for 20 years.  Senator Cegavske asked why some of the original projects on Exhibit C had not been addressed while others had been added via the CIP Additions list, Exhibit D.

 

Senator Raggio commented that for quite some time it had been recognized that the state retained only 15 cents in property tax for the purpose of CIP projects, and legislators had recognized that there would come a time when augmentation of the state’s portion of the property tax for that purpose would be necessary.  Senator Raggio believed it was time to take such action and also believed that adding 1-cent to the property tax for the state would be appropriate and prudent action by the Legislature.  Senator Raggio hoped that in the future the state would again find itself in a situation where it had adequate revenue from property tax and would not be required to use bonding for maintenance and retrofitting projects.

 

Mr. Ghiggeri referenced the Memorandum of May 1, 2003, from Evan Dale, Deputy Manager, SPWB, regarding sunset extensions, which requested an extension on reversions for CIP projects from 1997 and 1999, Exhibit E.  If agreeable with the Subcommittee, Mr. Ghiggeri stated those projects would be included when drafting the Capital Improvement bill.  Senator Raggio asked whether that action would extend the appropriations previously approved in the years indicated in Exhibit E, or would it add to the cost of the projects.  Mr. Ghiggeri replied that it would not add to the cost unless there were cost overruns.  The request would extend the reversion date due to time delays in completing the projects.  Senator Raggio stated that the Subcommittee would require assurance from the SPWB that the projects were still viable and were within project funding levels. 

 

Daniel O’Brien, Manager, SPWB, assured the Subcommittee that it was necessary to extend the projects listed in Exhibit E, and the SPWB would focus on completion of those projects.  He explained that the list comprised the projects that required additional time to complete.  According to Mr. O’Brien, the SPWB wanted to keep the Lied Library and the Veterans’ Home projects open because of ongoing litigation.

Chairman Arberry informed the Subcommittee that Project Number 03-P12L, funding for the design of the UNLV Student Services Center in an amount not to exceed $500,000, had inadvertently been omitted from the CIP Additions list, Exhibit D.  He assured the Subcommittee that the project had simply been omitted from the list and would not represent additional funding.

 

Chairman Arberry indicated that he would accept a motion.

 

SENATOR RAGGIO MOVED TO APPROVE THE SUBCOMMITTEE RECOMMENDATIONS FOR THE CIP PROJECTS AS DELINEATED IN EXHIBIT C, AND WITH THE BONDING AUTHORITY THAT ACTION WOULD FREE UP, TO ADD THE PROJECTS REFERENCED ON THE CIP ADDITIONS LIST, EXHIBIT D, AS FOLLOWS:  03‑C91L, DRI; 03-C92L, ECONOMIC DEVELOPMENT; 03-C94L, UNR; 03-C95L, UNR; 03-96L, CCSN; 03-C97L, CCSN; 03-C98L, GBC; 03-C99L, UNR; 03-P10L, UNR; AND 03-P11L, UNR; ALONG WITH $500,000 FOR PROJECT NUMBER 03-P12L, UNLV, WHICH HAD BEEN OMITTED FROM THE LIST.  THE TOTAL BONDING AUTHORITY WOULD BE $12,750,000 AND THE AMOUNT OF OTHER FUNDING WOULD BE $200,000.

 

SPEAKER PERKINS SECONDED THE MOTION.

 

THE MOTION CARRIED WITH SENATOR CEGAVSKE AND ASSEMBLYMAN ANDONOV VOTING NO.

 

********

 

Senator Raggio believed that a second motion would be necessary regarding the extension of reversions referenced in Exhibit E. 

 

SENATOR RAGGIO MOVED TO APPROVE THE SUNSET EXTENSIONS REQUESTED BY THE STATE PUBLIC WORKS BOARD AND EXTEND THE APPROPRIATIONS FOR THE PROJECTS DELINEATED IN EXHIBIT E.

 

ASSEMBLYWOMAN GIUNCHIGLIANI SECONDED THE MOTION.

 

THE MOTION CARRIED WITH SENATOR CEGAVSKE AND ASSEMBLYMAN ANDONOV VOTING NO.

 

********

 

Mr. O’Brien informed the Subcommittee that there had been some discussion regarding a possible federal grant for Project Number 03-C6, new state emergency operations center, Exhibit C.  The Emergency Management Division had applied for an $8 million matching federal grant, and if that were approved $4 million would be required in matching state funds.  Mr. O’Brien indicated that he wanted the Subcommittee to be aware of that situation.

With no further business to come before the subcommittee, Chairman Arberry adjourned the hearing at 6:08 p.m.

 

RESPECTFULLY SUBMITTED:

 

 

 

                                                           

Carol Thomsen

Committee Secretary

 

 

APPROVED BY:

 

 

 

                                                                                         

Assemblyman Morse Arberry Jr., Chairman

 

 

DATE:                                                                             

 

 

 

                                                                                         

Senator William J. Raggio, Chairman

 

 

DATE: