MINUTES OF THE ASSEMBLY COMMITTEE ON GOVERNMENT AFFAIRS Sixty-eighth Session March 10, 1995 The Committee on Government Affairs was called to order at 8:00 a.m., on Friday, March 10, 1995, Chairman Joan A. Lambert presiding in Room 330 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Douglas A. Bache, Chairman Mrs. Joan A. Lambert, Chairman Mrs. Deanna Braunlin, Vice Chairman Mr. P.M. Roy Neighbors, Vice Chairman Mr. Max Bennett Mrs. Marcia de Braga Mr. Pete Ernaut Mrs. Vivian L. Freeman Mr. William Z. (Bill) Harrington Ms. Saundra (Sandi) Krenzer Mr. Dennis Nolan Mrs. Gene Wines Segerblom Mrs. Patricia A. Tripple Mr. Wendell P. Williams COMMITTEE MEMBERS ABSENT: None GUEST LEGISLATORS PRESENT: None STAFF MEMBERS PRESENT: Denice Miller, Senior Research Analyst OTHERS PRESENT: Mr. John F. Mendoza, Chairman, Public Service Commission of Nevada; Mr. Douglas Ponn, Director of Governmental Affairs, Sierra Pacific Power Company; Mr. Charles Silvestri, Southwest Gas Corporation; Mr. Frank McRae, Nevada Power Company (See also Exhibit B attached hereto). Chairman Lambert declared a conflict of interest with respect to A.B. 188 and A.B. 189 and turned the meeting over to Vice Chairman Braunlin. ASSEMBLY BILL NO. 188 - Repeals prospective expiration of provision requiring public utilities to pay assessments for certain expenses incurred by public service commission of Nevada. Mr. John F. Mendoza, Chairman, Public Service Commission of Nevada, testified. Mr. Mendoza submitted a report of the Public Service Commission of Nevada (Exhibit C). He explained the Public Service Commission of Nevada (hereinafter referred to as the Commission) was required, by statute, to report to the legislature all of its travel expenses which related to appearances made by the Commission's staff before federal agencies and which were charged to public utilities. He referred to Appendix C of the report (Exhibit C) and explained the purpose of A.B. 188 was to remove the sunset provision (of the bill set forth on Appendix C), which required the Commission to report every two years. Mr. Mendoza advised the Commission was permitted to assess public utilities for travel costs incurred by the Commission for the purpose of representing Nevada before federal regulatory agencies. He said, "The bill is capped at $50,000." He indicated, to date, public utilities had been charged only small amounts. He stated, in 1991 and 1992, the Commission spent $11,167 for travel costs and collected the same amount from public utilities. He said the report (Exhibit C) reflected the sum expended by the Commission for travel costs during the last biennium was $5,396. He suggested the Commission's expenditures for travel costs would fluctuate each year. Mr. Mendoza advised the Commission made increasingly more frequent appearances in Washington, D.C. He indicated three of the four pipelines which serviced Nevada had plans for expansion which were before the Federal Energy Regulatory Commission (FERC), in Washington, D.C., at the present time. He said, "...the portion of investments that are likely to be assigned to the Nevada users is about $16.7 million, which means that that could be the impact upon the Nevada rate payer." He stated FERC was also processing plans of the Tuscarora Pipeline Company, an affiliate of Sierra Pacific, for construction estimated to cost $125 million. He advised Nevada's share of those construction costs could be as much as $118 million. He contended it was necessary for the Commission to appear before federal regulatory agencies and said the public utilities supported that concept. Mr. Mendoza explained public utilities paid the difference between the Commission's expenses, related to travel to Washington, D.C., and the amount allowed by the state for such expenses. He pointed out NRS 703.152 authorized the Commission to represent Nevada in matters which affected the development, transmission, use or cost of energy in Nevada and contained a finding by the legislature that the cost of energy in Nevada was affected by the Federal Energy Regulatory Commission and concerns of public utilities and their customers in the state should be represented at hearings held by FERC which affected Nevada. He indicated, in 1991, the legislature arrived at a method to fund the cost of travel for such appearances which exceeded the sum allowed by the state for such purpose. He suggested the method had proved itself and the sunset provision was no longer needed. Mr. Douglas Ponn, Director of Governmental Affairs, Sierra Pacific Power Company, testified. He stated he supported A.B. 188. He advised his company's experience (with the process for paying travel costs for the Commission) had been good and the billings the company received had been nominal. He declared it was appropriate for regulators of Nevada's public utilities to appear "... on federal matters.." and said his company was quite willing to support that effort. Assemblyman Bennett asked what Mr. Ponn foresaw would increase his workload in the future. Mr. Bennett indicated the point of his question was to determine whether it would be better to eliminate or to extend the sunset provision. Mr. Ponn replied the Commission's billings to Sierra Pacific for the past two years were in the amounts of $1,450.93 for 1993 and approximately $1,850 for 1994. He said he would expect billings to increase as the result of increased activity by the Commission with respect to federal matters which affected Sierra Pacific Power Company. He advised the electricity industry was in the process of restructuring itself and said a number of proceedings would be held before FERC at which it would be appropriate for the Commission to be present to protect the interests of Nevada's citizens. He indicated there were also ongoing matters before FERC; regarding regional transmission issues, in which FERC was attempting to broaden the market for electricity and said he believed the Commission would be involved in those matters also. Mr. Bennett asked if Mr. Ponn's comments referred to the federal plan to "...sell their power transmission lines..." Mr. Ponn replied the sale of power marketing agencies would be one of the issues in which the Commission might wish to become involved. Mr. Charles Silvestri, Southwest Gas Corporation, testified. He advised Southwest Gas Corporation supported A.B. 188. He stated Southwest Gas Corporation and the citizens of Nevada benefited from the presence of the Commission's commissioners and staff at FERC hearings held in Washington, D.C. Mr. Frank McRae, Nevada Power Company, testified. He stated Nevada Power Company did not oppose A.B. 188. Vice Chairman Braunlin closed the hearing on A.B. 188. ASSEMBLY BILL NO. 189 - Makes various changes to provisions governing recovery of certain civil penalties by public service commission of Nevada. Mr. John F. Mendoza, Chairman, Public Service Commission of Nevada (hereinafter referred to as the Commission), testified. Mr. Mendoza advised A.B. 189 addressed concerns about the manner in which recovery of fines was handled in the judicial system. He said the Commission had been holding conferences with public utilities and asking for their input regarding those concerns. He requested the hearing on A.B. 189 be postponed to allow the Commission to have further meetings with public utilities to attempt to resolve the concerns. Vice Chairman Braunlin advised Mr. Mendoza a subcommittee would be assigned to A.B. 189 but indicated, if anyone other than Mr. Mendoza was present to testify, the committee would hear their testimony at this time. Mr. Charles Silvestri, Southwest Gas Corporation, testified. He said Southwest Gas Corporation would be happy to work with the commissioners and their staff to revise A.B. 189. Vice Chairman Braunlin closed the hearing on A.B. 189 and turned the meeting over to Chairman Lambert. ASSEMBLY BILL NO. 190 - Repeals authority of public service commission of Nevada to require aircraft carriers to file adequate indemnity bonds or insurance. Mr. John F. Mendoza, Chairman, Public Service Commission of Nevada, testified. He said, "This is a relic of the previous jurisdiction that we had." He advised the Commission used to regulate airlines in Nevada but "...that was deregulated some years ago." He explained the Commission discovered a provision remained in NRS which required the Commission to regulate aircraft carriers and requested that provision be repealed. Mr. Bennett asked who regulated aircraft carriers at this time. Mr. Mendoza replied the federal government regulated them. Chairman Lambert closed the hearing on A.B. 190. ASSEMBLYMAN HARRINGTON MOVED DO PASS A.B. 190. ASSEMBLYMAN BENNETT SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY ALL MEMBERS PRESENT; ASSEMBLYMAN FREEMAN WAS EXCUSED AT THE TIME OF THE VOTE. Chairman Lambert assigned A.B. 190 to Mr. Nolan for the purpose of making a floor statement. Chairman Lambert turned the meeting over to Vice Chairman Braunlin. ASSEMBLY BILL NO. 188 - Repeals prospective expiration of provision requiring public utilities to pay assessments for certain expenses incurred by public service commission of Nevada. Vice Chairman Braunlin said the Chair would be happy to entertain a motion on A.B. 188. ASSEMBLYMAN ERNAUT MOVED DO PASS A.B. 188. ASSEMBLYMAN BACHE SECONDED THE MOTION. THE MOTION CARRIED; ASSEMBLYMAN LAMBERT ABSTAINED FROM VOTING; ASSEMBLYMAN FREEMAN WAS EXCUSED AT THE TIME OF THE VOTE. Vice Chairman Braunlin turned the meeting back over to Chairman Lambert. ASSEMBLY JOINT RESOLUTION NO. 12 - Proposes to amend Nevada constitution to prohibit an exemption for legislators or officers, employees or agencies of the state from laws applicable to the general public. Chairman Lambert asked if the committee was prepared to vote on A.J.R. 12. Mr. Bennett submitted proposed amendments to A.J.R. 12 (Exhibit D). Mr. Harrington commented, with the amendments proposed by Mr. Bennett (Exhibit D), he believed A.J.R. 12 was an excellent resolution and now applied to all elected officials. He said he supported A.J.R. 12. ASSEMBLYMAN HARRINGTON MOVED TO AMEND A.J.R. 12 (as set forth in Exhibit D) AND DO PASS. Mrs. Krenzer advised she was not yet ready to vote on A.J.R. 12. Mr. Ernaut suggested some research should be done regarding the impact of the proposed amendment which would cause A.J.R. 12 to apply to any elected official. He suggested, in some counties, elected officials might have "...some exemptions that are very, very necessary." The motion of Assemblyman Harrington to amend and do pass A.J.R. 12 failed for lack of a second. Discussions were held among committee members. There being no further business to come before the committee, Chairman Lambert adjourned the meeting at 9:35 a.m. RESPECTFULLY SUBMITTED: Sara Kaufman, Committee Secretary APPROVED BY: Assemblyman Douglas A. Bache, Chairman Assemblyman Joan A. Lambert, Chairman Assembly Committee on Government Affairs March 10, 1995 Page