MINUTES OF THE ASSEMBLY COMMITTEE ON COMMERCE Sixty-eighth Session May 15, 1995 The Committee on Commerce was called to order at 3:40 p.m., on Monday, May 15, 1995, Chairman Spitler presiding in Room 332 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Larry L. Spitler, Chairman Ms. Sandra Tiffany, Chairman Mrs. Maureen E. Brower, Vice Chairman Mr. Richard Perkins, Vice Chairman Mr. Dennis L. Allard Mr. Morse Arberry, Jr. Ms. Barbara E. Buckley Mr. Thomas A. Fettic Ms. Chris Giunchigliani Mr. Lynn Hettrick Mr. David E. Humke COMMITTEE MEMBERS EXCUSED: Mr. Michael A. (Mike) Schneider GUEST LEGISLATORS PRESENT: Assemblyman Jan Evans, District 30 STAFF MEMBERS PRESENT: Mr. Paul Mouritsen OTHERS PRESENT: Elizabeth Harrison, Profesional Counselors Charlotte Shaber, National Business Factors Marlowe Smaly, University of Nevada Reno (UNR) Colette Dollarhide, Ed. D., UNR Prudence S. Jones, UNR Alicia Smally, NASW Denise Y. Law, UNR Dave Kaul, UNR Mary Lowe, UNR John Coles, Ph.D., Professional Counselors Wayne Lanning, University of Nevada Las Vegas (UNLV) Tom Sexton, UNLV Jan Early, UNR Scott Walshaw, Finance Institution Division John Dorf, Nevada Association of School Psychologists Doug Walther, Financial Institution Division Laura Williams, TMCC Lori Carroll, Professional Counselors Lynne Williams, University of Nevada School of Medicine Jacalyn J. Gallagher, Professional School Counselors Sharen Weaver, Division of Insurance Andrea Kaylor, Professional School Counselors Betty Barhee, WCSD Counselors Thomas K. Gallagher Raymond W. Ritch, Professional Counselors Myla Florence, State Welfare Tom Harrison, UNR Eileen Omera, Professional Counselors Dave Calum Jerry Nims, Nevada Psychological Association Pat Coward, Nevada Collections Association Paula Berkley, State Board of Psychology Following roll call, Chairman Spitler went over some Committee "housekeeping" items. Mr. Paul Mouritsen and Assemblywoman Giunchigliani were requested to prepare an amendment on A.B. 115 in order to come to resolution. ASSEMBLY BILL 343 - Revises provisions governing certain conduct of developers of subdivided land. Chairman Spitler indicated A.B. 343 was on the desk in the Assembly Chamber. Assemblyman Allard and several others had been working to resolve a conflict with the Nevada State Contractors Board. When the bill was taken down to the Assembly floor Mr. Allard realized there was a problem because the way it was stated could mean different things to two different Boards. Mr. Allard had met with Mr. John Buchanan and Margi Grien from the Nevada State Contractors Board. Mr. Allard was concerned the property report did not contain anything that could have been construed as a compaction test and, therefore, a project could be shut down when they felt slabs were cracking because of poor compaction. Mr. Allard did not feel it was under their jurisdiction. He had been assured the property report did not contain that, although in testimony he had perceived it that way. His other concern was when discussing revocation of a license he wanted to make certain it was not a contractor's license, and the permit was not a building permit. His concerns in those areas had been satisfied. Chairman Spitler indicated he had also met with Mr. Allard, as did Ms. Tiffany, on the various meetings with the Nevada State Contractors Board to make sure one agency was not overlapping into the business of another. Chairman Spitler said he wished to entertain a motion to do a Committee amendment on the Assembly Floor. The Committee was comfortable with Mr. Allard's explanation and the Chair entertained a motion. ASSEMBLYMAN HETTRICK MOVED FOR A COMMITTEE AMENDMENT TO A.B. 343. ASSEMBLYMAN TIFFANY SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. Ms. Buckley updated the Committee on A.B. 484 and A.B. 528 heard on May 10, 1995. Assemblyman Close and she had met and proposed amendments to the bill which would be distributed individually to the Committee by May 16, 1995. She indicated the co-chairs could decide when the amendments would be considered. Chairman Spitler recalled A.B. 475 heard on May 8, 1995. He stated Alice Molasky, Insurance Commissioner, had been asked to consolidate three sets of amendments into one. It had been accomplished, distributed to the Committee, and the Chair said action would be taken on May 17, 1995. Ms. Tiffany requested Ms. Molasky to answer questions on the amendments before the vote was taken. Chairman Spitler indicated amendments on A.B. 478, proposed by Irene Porter and Barbara McKensie, which were distributed to the Committee. If the Committee had additional questions they were requested to contact those two individuals. It was the Chair's intention to move as soon as May 17, 1995 on that piece of legislation. Chairman Spitler announced there was a Subcommittee meeting scheduled immediately after the regular meeting on A.B. 299. He anticipated the subcommittee would return with recommendations on May 17, 1995. Chairman Spitler asked Ms. Giunchigliani how the Subcommittee meeting had progressed on A.B. 399. Ms. Giunchigliani indicated progress had been made and she had some new language culled from the comments made in the Subcommittee. They had met with the Attorney General's office to aid in the proposed language. She indicated another Subcommittee meeting would be required. Chairman Spitler asked for approval of the minutes of April 12, 1995, April 17, 1995, April 19, 1995 and April 28, 1995. ASSEMBLYMAN TIFFANY MOVED TO APPROVE THE COMMITTEE ON COMMERCE MINUTES FOR APRIL 12, 1995, APRIL 17, 1995, APRIL 19, 1995 AND APRIL 28, 1995. ASSEMBLYMAN ALLARD SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. Chairman Spitler indicated two amendments had been presented for A.B. 437. Mr. Whitacre, from the Employment Security Department (ESD), and the Department of Taxation had both submitted amendments. He asked Mr. Mouritsen if he wished to discuss those amendments. Mr. Mouritsen said he had Mr. Whitacre's amendment, however, he had not received the one from the Department of Taxation. Mr. Spitler requested Mr. Mouritsen to bring both amendments to the Committee meeting on Wednesday, May 17, 1995, and asked the Committee to study A.B. 437 for possible action that week based upon the two amendments. Ms. Giunchigliani queried if the addition of sales and use tax were the only items asked for by the Department of Taxation? Mr. Spitler replied yes. Chairman Spitler opened the hearing on A.B. 440. ASSEMBLY BILL 440 - Revises provisions governing escrow agents and agencies. Mr. Doug Walther, Deputy Attorney General assigned to the Financial Institutions Division, indicated he was present to assist Mr. Scott Walshaw with his testimony. Chairman Spitler indicated it was his understanding from the April 17, 1995 meeting, continued hearing was delayed on A.B. 440 because of concerns with land title. Mr. Walshaw and Mr. Coward were to contact the appropriate parties and return with necessary changes. Mr. Scott Walshaw, Commissioner of the Financial Institutions Division, indicated Chairman Spitler's understanding was correct. Subsequent to the initial hearing a meeting was held between representatives of the Land Title Association and interested parties from independent escrow company licensees administered by his office. The essence of that discussion focused on the issue of what an appropriate level of bonding coverage would be for a licensed company. Recalling from his last testimony, the legislative audit undergone by his office a couple of years ago, made a suggestion to look at increasing the minimum bonding levels from the current $25,000 to a higher level. Initially they proposed to do it on a sliding scale basis tied to an average deposit balance in the licensee's trust account. During the discussion in that meeting it was the consensus of opinion by everyone in attendance that they should increase the bond to $50,000, let it reside at that level, and not have a sliding scale. In essence that was the amendment being proposed. He indicated he would distribute the amendment to the Committee along with an overview of the bill (Exhibit C). One other issue had been discussed during that meeting. One of the representatives of the independent escrow companies had raised a question regarding the licensure of escrow agents. Each license company was required to have at least one licensed escrow agent as a condition to exist in business. The observation was made that title companies, under Nevada Revised Statutes (NRS) Chapter 692A, had licensed escrow officers who performed virtually the same function as an escrow agent at a Chapter 645A licensee. The licensing of an escrow agent through their office was a very laborious process involving a background investigation. The question had been asked if the investigative process could be waived if a licensed escrow agent, who formerly had been licensed as an escrow officer through a title company, applied for an agent's license. Mr. Walshaw had reviewed it through the Attorney General's office and the consensus of opinion had been it could be done, however, to clarify the issue they wanted to amend the statute to make it clear both in NRS Chapters 692A and 645A that there was, in essence, reciprocity between the two licensing areas. Therefore, a licensed escrow agent could go to the Insurance Division and use that licensing background as the basis for getting approved at an escrow office with a title insurer and vice versa. Again, that was in the text of the proposed amendment. Chairman Spitler asked if that meant they were dropping section 1, or was the plan to provide an alternative way to post the bond? Mr. Walshaw stated on page 2, line 39, it was proposed to delete the $10,000 figure and add $50,000. On page 3, line 13, it was proposed to delete the $10,000 figure and add $50,000. On page 3, lines 43 through 47; and page 4, lines 1 through 7, delete that language. It was a simple change substituting the existing $25,000 level for a new level of $50,000, and everything else would remain the same insofar as the existing language. Chairman Spitler asked if there was controversy among the parties regarding different ways to set the bond? Mr. Walshaw said a question had arisen as to whether or not they could substitute a fidelity bond for a surety bond. He told the attendees he would contact the Attorney General's office to obtain clarification on that issue. He had been told there was a distinct difference between the two types of bonds. In most cases the surety bond would cover the acts of employees as well as owners; whereas the fidelity bond was essentially aimed at the acts of employees. In that case many of their licensees apparently had fidelity bond coverage, as a prerequisite of doing business with certain clients, in addition to the surety bond coverage. They were just looking for ways to consolidate their insurance coverage. Unfortunately, it was not possible to address the statutory concerns. Mr. Walthers had confirmed it with the Attorney General representing the Insurance Division to clarify the differentiation between the two types. It was clear they had to maintain the surety bond as opposed to a fidelity bond. That fact was subsequently communicated to all the licensees by memorandum summarizing the results of the meeting, as well as the results of Mr. Walshaw's discussion with the Attorney General's office. He had not heard back from anyone and presumed by that silence, and the fact he had not been contacted, that nobody had a problem with it. Mr. Spitler asked if the Attorney General's office had sufficient time to receive the information? Mr. Walshaw said yes, definitely, and he had informed them the hearing was scheduled that date. Therefore, any interested party had been informed. Chairman Spitler asked Mr. Walshaw to address section 1. Mr. Walshaw indicated section 1 amended the chapter to permit a licensee to provide substitutes for a surety bond. Currently it was consistent with other areas that allowed posting of a cash substitute or some acceptable form, usually held in safe-keeping through the Treasurer's office, such as a Certificate of Deposit (CD) or suitable government bond in an appropriate amount. It set forth the terms and conditions under which that substitute was provided, which was consistently applied throughout the statutes which they administered. Section 2 of the bill required that an application for a license must be accompanied by an appropriate application fee. There was some confusion in the NRS chapter as to whether or not that fee was adequately addressed. Apparently those fees had been charged by the Real Estate Division before them, and subsequently when they took over they continued to charge the same fee. Upon close review of the statute it was discovered there was no actual language requesting the fee, therefore, they essentially codified the existing fee structure which had been administratively applied for many years. Section 2 had a provision in it which he called to the attention of the Committee. They recommended eliminating the prohibition on a person holding a mortgage company license and an escrow company license. In 1985 his office requested the Real Estate Division to put that restriction in NRS Chapter 645A. They had situations where licensed mortgage companies, that were required to maintain trust accounts for maintenance of collections and handle fundings of loans from private investors, were seeking ways to avoid their supervision by transferring that activity to a licensed escrow company license. At that time the Real Estate Division was not actively examining escrow companies' functions, therefore, they avoided those companies escaping scrutiny. Since both Chapters were administered by them now there was no longer need for that prohibition. They had several requests from licensed mortgage companies who wanted to enter the area of escrow work, particularly as applied to loan collections, and wanted permission to have joint ownership. Based upon review of the statute and the situation they went ahead with the request and recommended removal of that language. Section 4 addressed the fee issue wherein they were codifying what they believed had been administrative practice on new license application fees and license renewals for agency license, as well as agent's license. Section 5 of the act modified another section to be consistent with the changes in the minimum bond level, which had been discussed previously. The proposed amendment was in three different sections. Mr. Walshaw indicated he would contact the Insurance Commissioner's office to inform them why the amendments were being proposed. The original intent behind the changes in 1991 were to make sure that whatever changes occurred in NRS Chapter 645A and 692A were done simultaneously so they did not put competitive disadvantages for one entity over another. They both did essentially the same thing as far as the escrow functions were concerned. That was why the recommendation was made to do changes in both Chapters. Chairman Spitler asked if there was any more testimony on A.B. 440, pro or con. There being none he entertained a motion. ASSEMBLYMAN HETTRICK MOVED TO AMEND AND DO PASS A.B. 440. ASSEMBLYMAN TIFFANY SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. The Chairman opened the hearing on A.B. 504. ASSEMBLY BILL 504 - Makes various changes relating to collection agencies. Mr. Scott Walshaw, Commissioner of Financial Institutions, indicated A.B. 504 had been requested by his office. It pertained to NRS Chapter 649 which was the collection agency act. He distributed to the Committee an overview of the bill (Exhibit D) and pointed out a request for an amendment attached to the bill. During discussions with the Attorney General's (AG) office and members of the Collection Agency Association an issue had come up, between sessions, dealing with the AG office's interpretation of the definition of a "claim" as applied to a particular situation involving a company that was collecting judgments for unpaid child support. There was also a question that arose in regard to a company that was soliciting the city or county of Las Vegas for the right to collect unpaid traffic and parking ticket fines. Apparently, the way the statute was currently written, that activity was outside of the licensing requirement which had created consternation among licensed companies. At the present time a simple change was proposed that would redefine "claim" and would incorporate that activity as a licensable activity under the collection agency act. He indicated Mr. Walther was prepared to offer more specific information on it for anyone with questions. Mr. Walshaw went on to say insofar as the bill itself was concerned, it essentially was designed to address two principal areas. One dealt with some changes the AG's office had made which recommended they clarify the language as it applied to issuance of a license, as well as the parameters under which a license was to be issued. The second issue dealt with the bonding level currently required by statute. Again, similar to the language originally proposed in the bill dealing with licensed escrow agencies, they were proposing to put it on a sliding scale using exactly the same parameters as contained originally in A.B. 504. That was tied to average balances maintained in trust accounts. There would be a minimum bond of $10,000 and a maximum bond of $50,000 based upon those average balances in a licensee's trust account. The idea was to do two things: one was to increase the minimum bond level from its current $25,000 to $50,000, which would catch most of the companies operating at the present time because most of them had balances which would put them well above the $25,000 requirement. The second thing was to ensure they were not going to force other companies, who did not have those large balances, out of business. Nor did they want to create barriers to entry. Therefore, by setting the sliding scale and creating the opportunity to get a lower bond, it theoretically would make it more feasible for a person who wanted to get into the business to initially do that. As their business grew, obviously, they would have to post a larger bond to the point where eventually they would reach the $50,000 maximum. This language was taken by the bill drafter right out of NRS Chapter 676, which was the debt adjustor's act where similar language was adopted a few years ago after consultation with the industry. Mr. Walshaw indicated he would go over the substantive portions of the bill and entertain specific questions if the Committee so desired. Sections 1, 2, 5 and 9 would eliminate references to the "convenience and advantage of the community" as a criteria for determining when and if a license was to be issued and whether or not the act was going to base itself on that criteria. For instance, there was a section in the bill that actually required his office to go out and do surveys in the community to determine whether more collection agencies were needed in a particular community. He did not wish to be in the business of determining how much competition should be there and indicated it should be done by the marketplace. They wished to eliminate that language, if possible. Sections 3, 5 and 6 essentially redefined specifically how, and under what conditions, applicants would or would not be issued a license. In other words, there were specific requirements that had to be met in order to determine who was eligible for a license. The AG's office was very uncomfortable with some of the existing language as it applied to determining when, where and how a licensee was denied the opportunity to get a license. Ms. Buckley questioned Section 3, page 2, line 5, as well as 8 through 10, regarding requirements that someone be a citizen of the United States, as well as having a good reputation for honesty, trustworthiness and integrity. Her first question was, as long as a person was legally in the United States, why would their ability to operate a business be restricted? The second question was, how would one judge whether a person had a good reputation for honesty? Mr. Walther said the citizenship requirement had been the law for years. There was another section in the Chapter with respect to manager applications that referred specifically to a right to lawfully stay in the United States. He had no objection to an amendment to include that type of language. He could not think of a reason why a person would be denied a license if they were lawfully in the United States. The language was taken from section 6, the statute that dealt with managers. On the issue of good reputation for honesty, trustworthiness, integrity and competence, that was language existing in many licensing laws with which he was familiar and had worked well. The reputation acts allowed the state to examine specific acts instead of, as in the present law, to be of good moral character. That, in his opinion, was troublesome because it did not give enough guidance as to what type of things to look for. The proposed language would allow the Division to look at specific past acts of an applicant to determine whether they added or detracted from their fitness to hold that type of license. It took the state away from giving some type of moral judgement on a person's character which he felt would be difficult to defend in court. Mr. Walshaw pointed out in Section 6, line 44, they had placed language on which he felt they needed to focus. It was consistent with other areas they administered but it essentially allowed on a denial, an opportunity for a hearing and the dates and time frames in which that would take place. Mr. Hettrick indicated Section 4 on the application where it said a bond must be filed in the sum of $25,000, and then three months later, according to the new table, they could be reduced down to $10,000. He thought it a waste of time and effort and it should either be left at $25,000 and remove the less than $50,000 down below, or make it less than $100,000 at $25,000. Mr. Walshaw explained they had missed that and it should have been modified to say $10,000, similar to what happened in the original draft of the escrow bill. Mr. Hettrick wondered if they should leave it at $25,000 and make it less than $100,000 because it was at $25,000 minimum at the present time. Mr. Walshaw had no objection. He did not want to be accused of creating barriers to entry to the market, or trying to put someone out of business. That was seen as a way to address that potential question. A discussion ensued. Mr. Hettrick, referred to the question asked by Ms. Buckley and indicated lines 8, 9 and 10 on page 2, and again on lines 17, 18 and 19 on page 3, it appeared to him to have been covered when one looked at subsection 4, lines 13 and 14 on page 2, or lines 24 and 25 on page 3. The rest of it became very subjective. He thought a conviction or a plea of nolo contendre would be sufficient for fraud misrepresentation and moral turpitude. Mr. Walshaw commented that from time-to-time there were situations when employers had negative things to say about a former employee and were prepared to bring evidence and testify when there had not been a crime, a judgement, or anything relating to the questions raised on the lines to which he had referred. It could be a situation where they would have need for other language to address a circumstance not covered by items 3 and 4. Mr. Hettrick had concern with it and suggested tightening the language if they wished to leave it in. He felt that competence to run a business was not something they should judge. He understood the point made regarding a former employer, however, he felt they were suspect when a former employer did not want his former employee to become his competition. Mr. Hettrick was also concerned with due process at that point because someone could make an unwarranted accusation and prevent a person from going into business. Mr. Walshaw stated they had to support the accusation. Mr. Hettrick asserted it was not stated in the language of the bill. Mr. Walshaw agreed. A discussion ensued. Ms. Buckley stated if they were going to amend the section, and she agreed it was too loose the way it read, perhaps they could consider specific acts of fraud in the past or other unfair or deceptive trade practices. This would make it more objective but still give the opportunity to comprehend evildoers. Mr. Walther indicated one of the things the language was attempting to address were things not subject to dispute, such as civil litigation. A person might have a history of litigation or judgments against him that contained allegations of fraud and maybe conduct that would arise to criminal level. There was never a criminal prosecution because white collar crime was not prosecuted as vigorously as violent crime. They wanted to have the opportunity, if those matters came out in a background investigation, to rely upon that information if the court found a person guilty of fraud in a transaction. He felt there was a need to have a way to deal with those types of specific incidences in a person's background. On the other hand, he understood that unsubstantiated allegations should not be grounds for a denial, and if they were, that person had a right to a hearing and to present evidence that would show the allegations were not true. Mr. Pat Coward, representing the Nevada Collector's Association, stated on page 2, they deleted line 41, and on line 42, taking the "$50,000 for more but" out, and leaving it $25,000. They felt it had worked effectively in the past. People had not had a difficult time meeting that amount and there was no reason to lower it to the $10,000 level. Ms. Charlotte Shaber, representing National Business Factors, felt there should be a complete change of the entire act. There was so much in the bill that was bad. Her greatest concern in regard to licensing was the license agencies were always regulated. Nothing ever happened to the unlicensed agencies because they were unlicensed and nothing could be done. Insofar as bonding was concerned, there had not been a demand on the bond in over five years. She did not think there was a need to raise the bond amount. She offered to answer any questions for the Committee. Mr. Hettrick asked what amount was involved in the bond demand? Ms. Shaber said she did not know if there was ever a demand made. She had never in 15 years heard of a demand being made. Mr. Walshaw was requested to return to answer the question. Mr. Hettrick repeated the question: When was the last bond demand made and how much was it? Mr. Walshaw believed there had been one made in Las Vegas over ten years ago. There might have been one in between for a lesser amount. There was one made for the entire $25,000 on an agency in Las Vegas back in the early 1980's. He indicated he could get a complete record on the number of bond claims done historically and the amounts. Mr. Hettrick, with the Chair's permission, requested that information. He agreed with Ms. Shaber's question, did the bond really need to be raised to $50,000 if there had only been one claim of $25,000 in ten years? Why was the cost of business being increased if it had not been a problem? Chairman Spitler stated appreciation to Mr. Walshaw if he would provide that information. Ms. Myla Florence, Administrator of the State Welfare Division, and Leland Sullivan, Acting Chief for the Child Support Enforcement Program, were introduced to the Committee. Ms. Florence stated she originally planned to testify about a concern on page 2, lines 16 and 17, with regard to establishing an office within the state. As many were aware, the child support enforcement program referred part of its accounts to a private collection agency, G. C. Services, to collect delinquent child support and arrearages. G. C. Services had a 35-year history in the collection of child support and maintained their office in Atlanta, Georgia. The State Welfare Division specifically contracted with them with regard to their experience. G. C. Services presently contracted with other state agencies, such as Georgia, Virginia, Maryland, Massachusetts and Arizona. In discussions with Mr. Walther she was not certain whether the bill presented a problem for them. As long as they were not soliciting within the state there may not be a problem, however, she wished to get it on the record and have an opportunity to visit the issue further with the department. Chairman Spitler asked Ms. Florence to inform the Committee as soon as the issue was resolved. There being no more testimony the Chair closed the hearing on A.B. 504 and opened the hearing on A.B. 497. ASSEMBLY BILL 497 - Provides for licensure and regulation of professional counselors. Assemblyman Jan Evans, District 30, introduced Dr. Thomas Harrison, Associate Professor, University of Nevada, to the Committee. Ms. Evans gave an overview of the bill (Exhibit E). Dr. Thomas Harrison presented his testimony (Exhibit F) to the Committee. He summarized by saying things were changing in the state of Nevada and it was growing and expanding at a rapid pace. Professional counselors would become a greater force in the future. He advised the Committee it was time to do something about the profession of counseling. Ms. Giunchigliani asked for whom did one work as a professional counselor? Dr. Harrison replied public and private agencies, run-away shelters, battered women shelters, crisis centers, hospitals, and other agencies in the community. Ms. Giunchigliani indicated the bill did not include rehabilitation (rehab) counselors, certified substance abuse counselors, or corrections counselors, and wondered who was left? Dr. Harrison said those groups were excluded for particular reasons to ensure clarity. "Who was left" were the other four tracts that he trained at the Master's level, as did his cohorts at UNLV, and they were not marriage and family therapists. As long as they took the required courses in community counseling it would include school counselors, career counselors, and college counselors. Rehab was excluded. If they took the appropriate course work they could be that as well. Ms. Giunchigliani reiterated if they took the course work, and they were either a rehab or school counselor at that point in time, then this Board would license them even though they were already licensed by another Board. This would then allow them to be hired in a different area agency, profit or non-profit. Were they precluded now? Dr. Harrison said, yes, in two instances they were. One was in the case of school counselors. Assume a school counselor had taken the appropriate course work in community counseling, which would be four or five extra courses. Currently the Commission on Professional Standards granted a license for school counselors to practice school counseling in the schools. Once they left the school, even though they had equivalent training as other Master's level licensed practitioners in the state, school counselors would not be able to change venues, even with additional course work. Ms. Buckley asked how consumers had been hurt by the lack of licensing? Dr. Harrison noted the question had been asked of him recently and wished he could give numbers. Not meaning to be glib, he said there was no Board so there were no numbers. However, they had given to the Committee a five-page "horror story" and could, upon request, provide other articulated stories of abuse by counselors. Ms. Buckley expressed a reluctance to add another Board unless there was a real need for it. The need she looked at first was the need of the public and consumer. That was what she was most interested in learning about. Mr. Wayne Lanning, Professor, UNLV, a faculty member in the Department of Counseling and Educational Psychology, gave his testimony (Exhibit G). Ms. Tiffany asked the difference between a psychologist and a counselor. Mr. Lanning answered primarily the psychologists were doctor level trained. There were very few licensing laws that would license a Masters level psychologist. Ms. Tiffany indicated she knew some Masters level psychologists who had licenses. Mr. Lanning asked where? She answered, here in Nevada. Mr. Lanning reiterated Nevada did not license Masters level psychologists. Ms. Tiffany thought they were marriage counselors. Mr. Lanning said that was marriage and family therapy -- a different program. She asked again, what was the difference between a psychologist and a counselor? Mr. Lanning repeated, a psychologist was a doctoral level trained person. Ms. Tiffany indicated confusion. She said he was sub-categorizing a psychologist, yet leaving himself in a general category. Mr. Lanning said the licensing law in Nevada and other states would license people with a doctorate as psychologists, but not Masters level. There was marriage and family therapy Masters level training, with Masters degrees in social work, and there were licensed professional counselors. Ms. Tiffany asked with whom did they compare themselves? Would they compare themselves with a marriage counselor with a Masters degree? Mr. Lanning replied, yes, the training level comparison was with marriage and family therapy and social work. Those were all Masters level equivalent programs. Ms. Tiffany understood. She stated if they graduated with that degree there was no guarantee of a job. What kind of a job were they told they would be able to get when they graduated? Mr. Lanning said they were told there was no "licensed home" for them in Nevada. She asked what type of job did they apply for when they had a Masters in counseling? Mr. Lanning said they worked in communities. She asked for a "hard example". He said community mental health centers, which had been severely cut in Nevada, employee assistant programs in casinos that ran their own programs and hospitals that had those types of programs. Ms. Tiffany asked what difference a license would make? How would it change where they would be employable? Mr. Lanning said that was the point -- they were not getting those jobs in Nevada because people preferred to hire licensable people. Ms. Tiffany went back to Mental Health-Mental Retardation (MHMR) who would hire them with or without a license. What were they attempting to expand into whether or not they had a license? There was obviously a place they could fit now. Mr. Lanning said that was the point, there was no place they could fit because they were not licensed. A discussion ensued. It appeared to Ms. Tiffany they were trying to expand their scope of work and were attempting to go where they were not qualified to be. Mr. Lanning stated the people who graduated from their programs presently were employed in rehabilitation counseling, school counseling, marriage and family therapy and community counseling. Ms. Tiffany asserted they should take their licensing. Mr. Lanning indicated the people who would like to go into the community counseling program were choosing not to do so because if they took one of the other programs, such as school, they had the state licensing for school counselors; marriage and family had their own license; and some were choosing to go to social work. That was why they were not getting people to enroll in the community counseling program. Ms. Tiffany said she understood. Mr. Allard said Mr. Lanning had indicated 42 states required licensure for professional counselors. In those states did they require the same licensure as Nevada for social workers and family therapists? Mr. Lanning said, yes, the states with which he was familiar had licensed marriage and family people, and licensed social workers, and some had additional licenses. Mr. Allard wondered how long they had required a license in those other states? Mr. Lanning said the process had been over 25 years, Virginia was the first and Utah got one last year. Mr. Allard asked if they anticipated their client fees being raised as a result of the bill? Mr. Lanning answered, no, they would be comparable with the other licensed professionals. Mr. Allard asked if their fees would be raised over and above what the professional counselors were receiving at the present time? Mr. Lanning replied no, he would not anticipate it. Ms. Buckley queried if counselors could open their own business and accept clients without being employed by anyone else at the present time? Mr. Lanning answered, yes, without any controls. She wondered how choices were being limited by not having licensing if they could open a business and see clients? He said the choices were limited when licensed so they could be assured of minimal qualifications of people they chose. Ms. Giunchigliani reiterated the testimony of Mr. Lanning and summarized by stating that his people did not have a license as a professional, therefore, even though they had the same or similar training they would not be considered. Where was "community counselor" defined? She surmised that was the niche attempting to be carved out, but she did not see it in the language. Mr. Lanning replied the terminology being used was "licensed professional counselor". Community counseling was the label for the national accreditation standards of the program. Ms. Giunchigliani stated the direction for their niche was community based. She clarified they were in competition currently with social work and marriage/family therapy, but would licensing change the competition? If they did not want to hire those individuals because they were not licensed, then they were taking marriage/family counselors or social workers. Mr. Tom Sexton, an Associate Professor at UNLV, who worked with Dr. Lanning in the Department of Counseling Educational Psychology, presented his testimony to the Committee (Exhibit H). In answer to Ms. Tiffany's question regarding students, he indicated many of them returned for additional training in which they were not interested. Mr. Allard asked if a student studied to be a professional counselor, would they have the ability to pass the test to be a family therapist? Mr. Sexton answered, no! Mr. Allard clarified it was a totally different curriculum. Mr. Sexton asserted that was correct. Mr. Allard queried if they wanted to be a professional counselor and in order to be licensed they added to their curriculum and became licensed under family therapy, could they then specialize in professional counseling? Mr. Sexton said the reality was they probably would practice what they wanted to practice to begin with, which was professional counseling. They practiced under the umbrella of marriage and family therapy. There was no way to regulate it. They were licensed people doing mental health work. It was a broad umbrella over a whole spectrum of services. Mr. Allard wondered if that curriculum could be brought under the auspices of the existing family therapy board. Mr. Sexton mentioned Florida, where he had earned his Ph.D., and other states had omnibus boards where mental health counselors, community counselors, marriage/family counselors and social workers were under the same board. That arrangement allowed for the professional identity to remain while being governed by one board. Mr. Allard thought a new board would not have to be created if they would just accept that degree. Mr. Sexton agreed as long as that board expanded its scope to include professional counseling and included a different curriculum under its licensing jurisdiction. Chairman Spitler asked if there was any opposition to A.B. 497. Dr. Jerry P. Nims, representing the Nevada State Psychological Association, distributed hand-out (Exhibit I) to the Committee. He indicated he would not read it but touch upon a few points. First of all, as some of the questions from the Committee had indicated, there had been no evidence presented indicating the public needed protection from the practice of counseling by unqualified persons. No threat to the consumer had been identified. The only threat addressed was to the employment of some people at the University of Nevada, both Reno and Las Vegas. They had created unneeded programs and now discovered those programs were drying up which caused turmoil in the education faculty. Nonetheless, they saw there were areas where a field such as this had some purpose to serve. The objection from the Nevada State Psychological Association was it was clearly being fashioned not just as counseling, school counseling, rehab counseling, community counseling -- but as a mental health profession. There were already five mental health professions serving the consumers in Nevada. There was medicine, by way of psychiatry, psychology, marriage/family therapists, clinical social workers, and, of course, drug and alcohol counselors. Any notion there was a shortage of mental health professions simply did not "wash". Not only that, but it seemed to them that adding one more profession increased the confusion, it did not resolve it. Further, if the act were to become law, there could still be people representing themselves in the community as counselors. They just would not be licensed professionals. Now it really was getting into massive confusion for the public! Secondly, Mr. Nims went on, the qualifications, as stated in the bill, were designed to programs in education. In fact, part of the language said certain programs must be completed in counseling and related educational programs. He had no quarrel with that. It, indeed, precisely targeted where they thought that group of people could most serve their communities and they encouraged it. Given the enormous concern by some members of the Committee, and probably everyone in the room, over rising health care costs, the creation of another health care profession where there was no evident consumer need for such a profession, just seemed to be unwise public policy. The persons who could qualify for the act could already easily qualify for a similar related profession, as stated by Mr. Sexton. To create a new license because some people did not like a particular set of requirements seemed not to be sound public policy. They could easily do it and then practice as they pleased within the scope of that practice. Despite some of the reassurances, given the context of the words "appraisal" in connection with the terms "diagnosis" and "treatment", and so forth, as psychologists they saw the act would very clearly enable and encourage encroachment by people who, by their standards, were not fully qualified to carry out as full scale mental health providers. Because of those concerns he had faxed a series of amendments attached to and part of (Exhibit I). The general direction of the amendments was the same and that was to allow those counselors to serve where they had the most to offer, which was in career and educational training and counseling. That was an area where there was undoubtedly a need and while many psychologists were versed in that area, they did not pretend they could meet that need and had no objection to professionals willing to serve in those areas. They were very important ones. However, they would eliminate from the bill all references to diagnosis and treatment. They would delete the inclusion of such counselors under NRS Chapter 629 which provided health care providers access to records. Plus a few minor criticisms that they proposed to remedy by the amendments found on pages 2 and 3 in (Exhibit I). Chairman Spitler asked the remainder of testifiers to come in groups of three to testify, keep their statements short and to the point, and not repeat what had already been shared by others. Ms. Elizabeth Harrison stated she was a marriage and family therapist intern and a certified substance abuse counselor in the state of Nevada and viewed herself as a professional counselor -- that was her identity. Currently she offered, pro bono to the community, a pregnant teen support group in conjunction with a multidisciplinary team working with an eating disorder group. The question had been asked, if licensure should pass did they see it impacting or increasing fees. Not at all, as a matter of fact, adherence to her code of ethics would be to provide such services to the community. As she focused on the special areas of "at risk" individuals, if she were not to consider the social and emotional aspects of the population she would not be serving the population well. That was why it was critical to her that they include the whole individual in their definition of professional counseling. Ms. Alicia Smally, with the National Association of Social Workers, indicated they supported professional licensure and protection of the public. Mr. John Dorf, Legislative Chair for the Nevada Association of School Psychologists, stated his organization strongly supported the bill from the standpoint of providing protection for the public/consumer. They had heard the titles that counselors used, from camp counselor to, his favorite of all time, the internment counselor. He felt they needed the licensed professional counseling bill. Ms. Laura Williams, President of the Nevada Counseling Association as well as a professional counselor at Truckee Meadows Community College (TMCC), indicated the bill would ensure student counselees privileged communication with she and her colleagues in higher education in the state of Nevada. TMCC counselors had been informed by legal council that they must report all claims of sexual harassment whether or not it was in the best interest of the student. The best way to explain it was through example. A student came in saying her instructor had sexually harassed her but she was not ready to confront the instructor and bring charges. If it was subsequently discovered the student was harassed and it was not reported, since the state did not recognize privileged communication and professional counselors were not licensed, the institution and the counselor would be liable. As the policy stood, she personally would not go to a counselor at a community college with such a charge. Just to give an idea of the numbers of students it may affect, TMCC's counseling center alone saw over 4,000 students annually in the state of Nevada. That was only TMCC which was probably approximately one-third of the students in the state of Nevada. The license would avail her, as a professional counselor in the state of Nevada, privileged communication so she could work in the best interest of the student counselee. As a professional counselor she could provide a safe atmosphere to bring the student to a place where he/she could deal with the situation, confront the instructor and deal with it. At the present time, as an agent of the college she must work in the best interest of the college and report the incident, even though it was not in the best interest of the student counselee. In turn, the student was not only a victim in the class room but fell victim again to what she believed would be a safe environment in which to speak freely about an incident -- the counseling relationship. Should not the student counselee be protected from a second victimization? In closing, licensure would protect the victim, the counselor and the institution. Ms. Lori Carroll, currently licensed as a marriage and family therapist in Nevada, and a substance abuse and school counselor as well, indicated she held two graduate degrees in professional counseling from the College of William and Mary in Virginia. She very thoughtfully chose Nevada as her home and moved there immediately after graduate school because this was where she chose to become a resident. When she came to Nevada and found there was no licensure for professional counselors, she was dismayed and began to work for licensure immediately. After a couple of years of "stomping her feet" and refusing to get the marriage and family therapy license, she finally did it. This was her professional identity! She was a professional counselor and would like to be licensed in her chosen state. Ms. Jackie Gallagher, a professional school counselor in Washoe County, indicated it was not required for her to have a license to practice her profession because she was required to have a license by the Department of Education to do school counseling. As a school counselor she had concerns. A major component of what was done as school counselors was making sound referrals to parents and students, as well as faculty and staff, for outside counseling resources. They referred outside the school because the school environment was not conducive to long term counseling. Therefore, the importance of having qualified, competent, sound referral resources was a distinct concern among professional school counselors. Many people called themselves counselors, as was alluded to earlier. There were psychic counselors, sales counselors, diet counselors -- this legislation would allow them to delineate who was qualified and competent and who was not and enable them to identify and make sound referrals for mental health counseling. With the consumer in mind she strongly supported the move for licensure for professional counseling. Ms. Andrea Kayler, President of the Greater Nevada School Counselors Association, indicated she also sat on the Counselors Association Board and was a voting delegate with the American School Counselors Association and a member of the American Counseling Association. She introduced Betty Barker, the counseling coordinator for the Washoe Country School District. She said school counselors, as a group, supported the bill to license professional counselors. They wanted to address some specific reasons for their support. First of all, school counselors had a Masters degree. They took the same 42 credit core curriculum as the marriage and family counselors who were licensed by the state. After the 42 credits they specialized in their own individual areas and took their last few classes, practicums and internships. School counselors were trained with a developmental life skills perspective which they felt benefited the public. The bill would not restrict the practice of school counselors who were licensed by the state. The pursuit of the licensed professional counselor would be a voluntary additional process beyond the school counseling license. It would create additional career opportunities for those wishing to pursue it in agencies or private practice. It would bring them on-line with other Masters level professionals in related fields, such as social work or parole and probation for career options. Betty Barker, a member of the Greater Nevada School Counseling Association Board and also the Program Assistant in Counseling for the Washoe County School District, stated there were many reasons for school counselors to support this legislation. It gave them, as Masters level counselors, additional career options that would add to their credibility and professional identity. Currently they had a Masters degree that was educationally equivalent to other mental health professionals. This opportunity would encourage school counselors to pursue additional professional growth and opportunities. Ms. Paula Berkley, with the State Board of Psychological Examiners, expressed more concern with scope of practice and read two sentences out of her testimony. "The NRS defines the practice of psychology as a diagnosis treatment amelioration and prevention of mental and emotional disorders. In this bill, in section 6, it contains very similar language including diagnosing and the prevention and resolution of mental and emotional disorders." She felt it reflected Ms. Giunchigliani's and Ms. Tiffany's questions regarding . . "Who are you? What do you do? What is the difference?" It was more than simply a degree difference but also, hopefully, a medal of competency and what one should and/or should not do. She indicated she would be happy to work with a subcommittee on the bill. Their simple solution was to take out the words "mental", "emotional", and "diagnosis", because then they would not be doing things within the scope of the practice of psychology. The reason she had the "brass" to ask that was because when she talked with Mr. Harrison he said ten percent of all the counselors he was identifying would be dealing with mental health. Therefore, if they were the only ones complaining about it and a counseling service was desired, because there was possibly a need for a board of school counselors, it was fine with them. It was the mental and emotional disorders issue to which they were taking exception. If that were to be removed from the bill, there would be no opposition to it, and it would be simple and easy. Ms. Giunchigliani asked about section 6, line 1, and understood the diagnosis part. She asked Ms. Berkley to explain about mental/emotional disorder. Ms. Berkley said it was a "gloppy" term. If they could arrive at terms that would better distinguish what a Ph.D. psychologist did, and what a Masters degreed mental health counselor did, then they might have something with which to argue. At the present time they were arguing about the same terms and she could not figure out what it was they were doing different. She indicated she was not a psychologist and it was easy for her to get confused. Ms. Giunchigliani asked if there was over-lapping between social work and marriage/family therapist? Ms. Berkley said the Board felt that at a Masters level a marriage/family therapist was basically the same kind of thing. Maybe there were two or three other courses, and if so why not "glop" them together somehow. Ms. Giunchigliani remarked she did not care much for the "glop" terminology. She expressed she had not signed on with the bill because she did not like the idea of creating another Board. However, there could be delineations made since there seemed to be a similarity in many areas for marriage/family and the others. Perhaps by adding some counselors to the Board and crafting potential training, it might be a way to accomplish something. She did not see a conflict with the standards board because they only licensed school counselors. If a school counselor wished to get an additional license they would come under that board at that point in time. Ms. Berkley anticipated somebody would start doing mental health kinds of things and she would receive a complaint. They could go after them if they were practicing psychology but since their practice and Ms. Berkley's group's practice looked the same, how would it be handled? It had to be clear! Mr. Fettic asked if he could put a sign outside his door today stating he was a professional counselor and not be in violation of the law? Ms. Berkley said no. Ms. Kayler said they had spoken about different levels of training and what it meant. She felt some interesting issues had been raised in regard to the mental health perspective versus the mental illness perspective. Being in the school setting, if one had children, one had come up against the reality of a child who was not doing well in school for a period of time. One may not feel need of the professional services of a psychologist. One may not see it as being that serious in nature. That was not to say a psychologist could not handle any level of issue. However, a person may choose, and prefer to have the option, to hire people in a specific area who were focused on it. If people got another license so they could be allowed to practice, would that be pulling them away from the professional area in which they might give the most help to the community? It was clear where that help was. Ms. Barker commented, in response to Ms. Giunchigliani's suggestions, the philosophy in the state of Nevada did not seem to be for an omnibus board. If the state wished to go the direction of covering many different mental health professionals it would be an entire restructuring. At this point in time there were specific fields of training and expertise under separate boards. She felt "glopping" would be an appropriate term as to what would happen in attempting to place diverse groups under the same board. She, personally, felt an omnibus board would be a good idea. Chairman Spitler said it would be an enormous project to take on at this point in time. Mr. Humke had some questions for the original proponents. Mr. Tom Harrison was called back. Mr. Humke expressed concern about privilege and confidentiality. First, what mental health professions honored confidentiality and a duty to maintain client privileged information? Mr. Harrison responded currently the already articulated five mental health practitioners had that regulation. Second, Mr. Humke stated he had been reading through Dr. Nims' suggested amendments and he understood Mr. Harrison was one of the individuals to whom those materials had been faxed. Mr. Harrison agreed. Dr. Nims had suggested, in regard to page 13, line 1, there was a need to add the word "confidential" before the word "communication". Mr. Humke asked if Mr. Harrison agreed with that change. Mr. Harrison believed that was correct, but unfortunately he had not received those amendments until immediately before coming to the hearing and had not had a chance to study them. He trusted Dr. Nims' judgment and it seemed an appropriate addition to the bill. Mr. Humke said other sections he was concerned about were 63 and 65, on pages 16 and 17. Those were privileged proposed statutes that tended to show an exception for a Tarasov case. He further explained there was a famous California case, known as the Tarasov case, in which a professional therapist had a duty to warn a patient if someone was about to intentionally harm them. Was that what was being alluded to in sections 63 through 65? Mr. Harrison answered, yes, that was certainly part of it. Mr. Humke asked if there were other parts? Mr. Harrison replied it was his understanding in section 65, line 38, paragraph 1, was where they were talking about danger to others. He had read the other sections and felt they related to other concerns. Mr. Humke remarked that section 65 took in what he understood to be the requirements of the Tarasov case law requirements. Would it also cover child abuse reporting requirements? Mr. Harrison said it was his understanding that was a national requirement, and yes, it would by default cover, and within 24 hours it would have to be reported. Mr. Humke indicated there was vigorous head-nodding in the audience. Dr. Nims interjected regarding privilege and confidentiality. One of his concerns was a rather large number of people who might become professional counselors. He had heard the number 750, he did not know if that was high or low. It could be larger than all of the other social work/psychology/MFT's put together. To extend privilege to 750 people -- and privilege meant one could not bring the person into a courtroom to obtain their evidence, not just in favor of a client but against a client in a criminal, or perhaps, in a civil proceeding. That left a huge gaping hole in how the judicial system worked and he felt it deserved thoughtful consideration. Perhaps it would be wise to ask the advice of the judiciary committee. There were other sections of the bill, concerning Tarasov and so on, that were well written and well covered and could be added to some of the other licensing statutes as well. Chairman Spitler, speaking to Ms. Evans, indicated there many amendments before the Committee and wondered if her representatives could meet and discuss which amendments they could approve. He requested they return to the Committee within one week because if the bill passed the Commerce Committee it also needed to visit the Ways and Means Committee. It was not concurrently referred at the present time. He requested them to inform the Chairs what progress had been made after one week. It was their intention at that time if resolution could not be reached to ask Ms. Brower and Mr. Schneider to work with them to assist in reaching resolution. He hoped it could be treated and moved within a week-and-a-half. Ms. Evans agreed and felt it was a reasonable time line and a request for the process. She indicated they would do everything they could to bring it about. Chairman Spitler asked if there was any more business to come before the Committee. There being none, the hearing was adjourned at 5:30 p.m. RESPECTFULLY SUBMITTED: Barbara Moss, Committee Secretary APPROVED BY: Assemblyman Larry L. Spitler, Chairman Assemblyman Sandra Tiffany, Chairman Assembly Committee on Commerce May 15, 1995 Page