MINUTES OF THE ASSEMBLY COMMITTEE ON GOVERNMENT AFFAIRS Sixty-eighth Session March 13, 1995 The Committee on Government Affairs was called to order at 9:35 a.m., on Monday, March 13, 1995, Chairman Bache 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 GUEST LEGISLATORS PRESENT: Assemblyman David Knowles, California State Assembly STAFF MEMBERS PRESENT: Denice Miller, Senior Research Analyst OTHERS PRESENT: Kay Bennett, Carson City Board of Supervisors; Monique Laxalt Urza, Attorney at Law; Jim Gallaway, citizen; John Falk, Tahoe Sierra Board of Realtors; Jim Baetge, TRPA; Richard Mudgett, TRPA; Steve Teshara, Lake Tahoe Gaming Alliance; David Strongin, citizen; Jim Robertson, citizen; Jan Gilbert, League of Women Voters; Rochelle Nason, League to Save Lake Tahoe; Joe Johnson, Sierra Club; and all others included on Exhibit B, Attendance Roster. ASSEMBLY BILL 202 - Revises act relating to Tahoe Regional Planning Compact. (BDR 22-7) Assemblyman Pete Ernaut, sponsor of the bill, opened the testimony on A.B. 202. He proceeded through the bill in a brief manner. He read from a handout while the committee followed along (Exhibit C). The primary revision to A.B. 202 would be a stipulation that the seven-member delegation from Nevada be elected by the voters rather than be appointed. He covered each section and then stressed that A.B. 202 was a measure of accountability. He also said the Tahoe Regional Planning Agency (TRPA) was an organization operating with little if any accountability to the people they regulate. Furthermore, the TRPA has the ability to tax as well as holding police powers over the property owners of the Tahoe Basin. Mr. Ernaut expressed those people whose lives are directly affected should have a voice. He urged favorable consideration of A.B. 202. Assemblyman David Knowles from Assembly District 4 in California was introduced by Mr. Ernaut. He represented the constituents in the Tahoe Basin on the California side. Mr. Knowles related in 1990 he began to receive dozens of complaints from residents of the Tahoe Basin regarding the way they were being regulated down to the minutiae of their activities by the TRPA. This began a process on his part to learn more about the basin, its residents, their needs and the unique governance of the area. He discovered all appointees on the TRPA except for three on each side of the state line are prohibited from living in the Tahoe Basin. That is part of the congressionally mandated Bi-State Compact. Mr. Knowles stated he and Mr. Ernaut had never met prior to the hearing on this bill and assured the committee they were on a representational drive by their constituents to say the bill as it currently exists does not work to properly discharge the duties for which the TRPA was originally established. He questioned why people were being told what to do with their lives by individuals they would rarely meet or talk to, who do not reside in the vicinity and who are appointed on a purely political basis. Mr. Knowles attempted to pass similar legislation last session in California and it failed. He emphasized the need to stick to their convictions and beliefs and keep bringing the bill back until it passes on its own merit. He stressed the residents of the basin were in favor of the bill. He was confident the companion legislation in California would pass out of his house before the end of the session. He encouraged passage of A.B. 202. Mr. Ernaut left the committee with a question: "How would you feel if in your district there existed an entity that the state told you is a national treasure and as a locally elected official, you do not have the capacity to administer it and regulate it correctly?" Assemblyman Bennett asked if the new district boundaries would only include the area from the crest line to the shoreline. Mr. Ernaut replied not necessarily as there was some question of uninhabited areas in the Carson City area which would be included. Assemblyman Tripple wondered about the interim study on Lake Tahoe and did not recall this being an issue or a recommendation of that study. Mr. Ernaut affirmed the bill was not a product of the interim study. He indicated some of the information was misleading and an attempt to undermine A.J.R. 1 when in reality the bill would attempt to achieve the same goal of increased representation of the residents of the Tahoe Basin. He said this bill was taking a larger step than A.J.R. 1 but addressing the same issue of taxation and police powers without representation. Assemblyman Nolan wanted an idea of population of the geographic area of the Tahoe Basin in California. Mr. Knowles indicated the number was approximately 63,000 on the California side. Mr. Ernaut mentioned it was a bit higher on the Nevada side, but not by much. There are many seasonal residents in the basin. Assemblyman Freeman responded to Ms. Tripple's comment on the interim study and said the concept was never discussed and that A.J.R. 1 was to ratify the 1987 amendment, not to change the composition of the TRPA board. Mr. Knowles answered by saying there is nothing in the bill to necessarily change the composition of the directorship of the TRPA as long as those people lived in the Tahoe Basin and were elected by the residents of the basin. He wanted to go on record as being solidly united with an opinion forwarded by the League to Save Lake Tahoe that TRPA board members should be residents of the Tahoe Basin. Mr. Ernaut referred Mrs. Freeman to page two of his handout (Exhibit C) delineating A.J.R. 1 and pointed out the similar direction of A.B. 202. Assemblyman Segerblom asked Mr. Ernaut to ascertain that three members of the TRPA board were elected from Douglas, Carson and Washoe counties. Mr. Ernaut responded in the affirmative. He also mentioned several great board members and how they have endeavored to make public policy enduring. Mrs. Segerblom interjected we all think of Lake Tahoe as our lake; even as a resident of Boulder City, she still considers it her lake and does not feel all members need to reside there. Mr. Ernaut thanked her for the comment. He stressed she did not have to live in the basin where a regulatory agency with no accountability has the ability to tax, place mitigation fees and police the local residents. Assemblyman Neighbors wanted to clarify a bill passed several sessions ago that affected Nye county which was singled out for special action. In the end, Nye county took the case to the Supreme Court and it was thrown out. Mr. Neighbors queried if they were doing the same thing in this case, singling the area out. He also wondered if there was a constitutional violation of any sort. Mr. Ernaut told Mr. Neighbors ..".by creating TRPA in the first place is more analogous to what happened in the City of Pahrump than us trying to undo it. That area was singled- out initially in 1969 and ratified in 1980." He also said that certainly did not make it right and as Mr. Neighbors was a proponent of less federal intervention in public lands, he could see that argument very clearly. Assemblyman Bennett remarked the last ratification of anything in the TRPA was in 1989 and given the attitude of Congress today, would this current bill encourage Congress in future TRPA legislation. Mr. Ernaut said he hoped this would be an appropriate message. John Falk, representing the Tahoe Sierra Board of Realtors, spoke in favor of A.B. 202. He indicated the board supported the concept of a representative democracy. Mr. Falk stated a representative government is not a luxury, it is a necessity to forward the philosophy of government by and for the people. At present within the TRPA exists a shadow government that is neither accessible nor directly accountable to the people over which it exerts extraordinary control. He suggested that political appointments by their very nature are inferior to local elections to seat the governing board of the most powerful governmental entity in the region. He went on to say the assets and liabilities associated with regional government could be debated endlessly. The more straightforward proposition is that if another layer of government is seen as necessary or desirable, at least ensure a degree of accountability through the well-established and respected process of direct elections. Accessibility, accountability and responsiveness are reasonable expectations for the people to have in regard to their local governmental structure. Local and direct elections could only enhance these characteristics of good government. He emphasized the issue was not one of environment versus development, nor nature versus business. Rather, the issue is over the most appropriate form of government to provide the necessary oversight for the resource that is Lake Tahoe and the surrounding basin lands. He said the artificial and contrived polarities between real estate interests and environmental interests are patently false. He stated the real estate industry has more to lose than the average citizen if the beauty of the lake and the land are compromised. As a resident of the high sierras, all income is derived from the natural attraction that is Lake Tahoe. If there are any doubts that the structural revisions proposed by A.B. 202 would endanger the lake, the board of Realtors would be first to deride the alteration of the compact. He espoused confidence that the proposal would not degrade the lake resource and would enhance the region's confidence and acceptance of TRPA. Some have said locals are incapable of providing adequate stewardship over the lake resource. Others have gone as far as to suggest that, given the opportunity, locals would pave over the lake. How absurd and incredibly offensive to suggest that residents would damage the lake willfully or in ignorance. He pointed out today's basin resident has an enhanced environmental awareness and sensitivity unlike most other people. He reiterated support for A.B. 202. Assemblyman Nolan questioned if the real estate industry was encumbered by the TRPA. Mr. Falk said the TRPA has a totally negative impact on the industry to some extent. He stated they were willing to tolerate whatever regulation was necessary to preserve the basin resources. They have found the focus of the TRPA has been on the micro-management of the residential allocations rather than on some of the other issues surrounding NDOT and Cal-Trans involving inflow of materials into the lake which has a dramatic impact. The vast majority of the basin lands are currently in state or federal hands. To focus in on residential development is to focus in on a minor portion of the basin and its resources. Mr. Nolan requested a couple of examples of encumbering regulations to the industry. Mr. Falk related an incident of a few years ago involving how to deal with PM10, particulate matter under 10 microns, that was being emitted from wood stoves. The decision was made to use a point of sale retrofit for wood stoves at the time of sale. This was found to be less than appropriate and the Tahoe Sierra Board of Realtors argued as such in front of the Advisory Planning Commission as well as in front of the governing board. They said it was inefficient, ineffective and lacked equity. The governing board went ahead with the retrofit anyway. Mr. Nolan also confirmed Mr. Falk had a committee in the Advisory Planning Commission to address and bring redress on critical issues. Mr. Falk said yes and those people were the experts. There was no desire to remove any of the expertise from the agency. They only want the final arbiter, the governing board, to be locally and directly elected. Richard Mudgett, member of the TRPA Advisory Planning Commission, spoke in favor of the bill. He said the TRPA was a necessity but the system was not working. He objected to the expenses of the TRPA with nothing to show for it. He read from a lengthy handout he provided to the committee to emphasize his point (Exhibit D). He summed up his testimony by stating the need to get the TRPA back to being a planning agency by allowing the citizens to vote for the governing board of the agency. David Strongin, another resident of the Tahoe Basin, spoke to support A.B. 202. He said when Paul Laxalt and Governor Reagan created the TRPA, they did so to prevent the rape of Lake Tahoe; but they never intended the rape of the Lake Tahoe property owner. That in fact is what has been happening since the inception of the TRPA. He indicated that would be okay if everyone in the basin wanted it that way, but they do not. He stated the TRPA has managed through the authority given them by the Bi-State Compact to evade the democratic process in favor of the autocratic one of simply ordering things the way they want. He expressed dissatisfaction with the current political representation in the basin as well as with the TRPA. He remarked the people were capable of governing themselves and was adamant about the people being represented by elected individuals, not appointed ones. Jim Robertson, a resident of Carson City spoke in favor of the bill. He mentioned he was on the original Lake Tahoe study committee that recommended the current form of TRPA to the two state legislators prior to the start of the agency. He also served two years on the TRPA board. He has always felt TRPA served its purpose but it was wrong because the people on the board were not elected which goes against the basic democratic process. He urged consideration of the bill. Mr. Harrington questioned if the people who live within the basin want to have total control, do they want to foot the total bill. Obviously they cannot as the cost would be approximately $500,000,000. Mr. Harrington said because people outside the basin are being asked to pay for this, there needs to be some representation for them too. He suggested some directly elected members in addition to other representation from Nevada and California generally. Mr. Robertson indicated he would rather have all members elected as proposed in the bill but it would be a decent compromise. Mr. Harrington asked how many people would need to be directly elected versus the number representing the rest of the people. Mr. Robertson declined to answer and said he needed more time to study the issue. Mr. Nolan wondered why the original TRPA board was not structured differently to begin with. Mr. Robertson said he had looked for the final report but could not find it. All he could recall was a great debate on the issue of elected versus appointed and the outcome was obvious. Kay Bennett, Carson City Supervisor and TRPA representative, spoke in opposition to A.B. 202. She read from a prepared handout (Exhibit E) highlighting three major reasons for her opposition to the bill. One of the reasons, she explained, was the need for broad-based representation for the basin which she felt would not be achieved by having only local residents elected. Secondly, she stated broad-based funding would cease if that representation no longer existed. Finally, she pointed out A.B. 202 would disenfranchise Carson City by splitting the Nevada side into seven equally populated districts which are not drawn along governmental lines. Mrs. Bennett urged a no vote on A.B. 202. Mr. Harrington mentioned if there is taxation and regulation there should be direct representation on the board. He questioned if Mrs. Bennett would be opposed to having some members of the board directly elected by those who have to live under the regulations of the basin. Mrs. Bennett indicated she has thought about that and felt the language would have to be carefully examined to determine things like who would that person be, where would she come from, how would the district be shaped and who would pay for the election costs. She said she was elected and does indeed represent the people of Carson City. She lives within the district that stretches to Lake Tahoe. Mr. Harrington said he would have one or two elected from the Nevada side and one or two from the California side on an at-large basis. He also stated because there is no population in the Carson area of the Tahoe Basin, she was elected by residents of outlying areas and perhaps basin residents did not feel she was truly their representative. Mrs. Segerblom queried if Spooner State Park was in Carson or Washoe County. Mrs. Bennett answered Spooner State Park was in Douglas County and Sand Harbor was in Washoe County. Mr. Jim Gallaway, resident of Douglas County, spoke in opposition to A.B. 202. He mentioned Lake Tahoe is a national treasure that the residents alone cannot support. The Lake is everyone's treasure. It has an international appeal for tourists from all over the world. Local government is adequate for local issues. He said we cannot afford to have government concentrated in one area to control the destiny of Lake Tahoe. He stressed the need to keep the whole state of Nevada involved. Mrs. Segerblom asked how the vote would go in the basin if the people did elect the governing board of the TRPA. Mr. Gallaway pointed out some of the residents are not full-time and the part-time residents' vote would have to be considered as well so he was not sure how the vote would go. Steve Teshara, Lake Tahoe Gaming Alliance, gave a local business perspective on the issue at hand. There is a lot of frustration with the essence of what is mandated by the Bi-State Compact and what is in the adopted TRPA environmental thresholds. He pointed out perhaps there would not have been any dramatic difference in the results of issues on fisheries or land buyouts if an elected board were in place because it is the mandates of the Compact and the environmental thresholds that drive the agency, not who is on the board or how they were put there. On behalf of the Gaming Alliance, he agreed with the comments that there are multiple interests in the region, including national, state and local and the governing board should reflect that diversity. A strictly locally elected board would not do this. It would certainly undermine the ability of the TRPA and other agencies to go to Washington or Sacramento to seek funds to do the necessary work to maintain the environment. The local entities do not have enough money to do the job on their own; they need federal and state assistance. This is a partnership effort, both within the region and externally. There is also a growing international community that is a constituency of Lake Tahoe. Mr.Teshara indicated this bill would undermine the local governments at Lake Tahoe. This would apply to all local governments who have put up money, who have participated, who have agreements for upcoming projects in the region because of the creation of the new electoral districts. He also believed this would disenfranchise the state and federal government and could lead to a takeover by the federal government. They do not wish to return to a period of chaos which they feel this bill would cause. The meeting was recessed until after the floor session. After the floor session, the meeting reconvened with Speaker Dini giving his testimony first. He supplied a nine page handout for the committee (Exhibit F) to follow along while he read. Mr. Dini provided a history of the Bi-State Compact and how it was created to protect Lake Tahoe and its environment. He capsulized the various limitations and amendments of the compact over the years. He related the numerous sessions and redrafts as well as the countless hours of work involved in arriving at a workable compact. Mr. Dini emphasized the passage of A.B. 202 would basically eliminate all of the previous work done on the compact and diminish recognition of the statewide significance of Lake Tahoe. He urged an indefinite postponement of A.B. 202. Mrs. Freeman thanked Mr. Dini for giving the committee an historical perspective and his statewide viewpoint to preserve what is considered a national treasure, Lake Tahoe. Steve Teshara returned to finish his testimony. He reiterated some of his earlier points and elaborated on Speaker Dini's testimony as to the great amount of work, changes and amendments that have gone into the compact to make it what it is today. The system is imperfect, but the players are agreeable to finding mutually acceptable solutions to the problems that exist. He indicated working through the existing TRPA mechanisms and with the agency to affect a more user-friendly approach would be the best way to go. The Gaming Alliance would like to confine their modifications of the compact to A.J.R. 1 which would require legislative representation on the governing board of the TRPA. Mr. Bennett questioned why it would be harder to get funding for the TRPA if A.B. 202 is passed. He requested documentation from Mr. Teshara to that effect. Mr. Teshara responded he could attempt to provide the requested information. He would inform Mr. Bennet of the current on-going legislative efforts such as their recent trip to Washington and the believed receptivity to proposed funding if they had the elected board in place. Mr. Nolan asked how many venues or forums and committees were available in the Tahoe Basin for citizens to work with concerning local issues. Mr. Teshara said there was the Advisory Planning Commission which has a certain perimeter of issues in which it can take public testimony and provide recommendations that are forwarded to the governing board. In terms of TRPA itself, they hold a number of public hearings on various issues. Currently there are on-going forums on forest health and transportation. There are a variety of ways the public can bring their issues forward. He acknowledged it is sometimes difficult and frustrating to come forward and address a very complex issue without the money to hire expensive counsel. Mr. Teshara's agency has tried to provide educational forums to assist people in dealing with the agency without having to engage legal consultation. The Gaming Alliance works extensively at the local chamber level to try to educate people to the process and to alert them to issues coming forward ahead of time so they can bring testimony forward in a way that is meaningful and they can feel they are part of the process. This bill proposal, in their judgement, would bypass existing local government which also provides an opportunity to testify on local governmental issues. Monique Urza, Attorney at Law, testified on behalf of Steve Wynn, current member of the TRPA board. He had strong objections to A.B. 202 which she presented in a letter to the committee, emphasizing three main points (Exhibit G). The first objection was the undermining of the multi-interest representation that was fundamental to the TRPA compact. Secondly, the virtually certain foreclosure of other funding sources for the TRPA cannot be tolerated. Third, if the composition of the board is drastically changed, the expertise in governmental affairs and environmental protection would be lost. Mr. Wynn has mentioned the legal question of impacting and restructuring the boundaries of the three involved Nevada counties so they no longer exist as far as extending those boundaries into the Lake Tahoe Basin. Ms. Urza responded to some of the comments made during the testimony. She mentioned the composition of the current TRPA board is a model of democracy. It takes multiple, distinct interests, brings them together and represents them all. She pointed out there is nothing in the concept of democracy that says a discreet, small group of people should be able to exercise all authority on a subject that impacts the whole country, the state and all international visitors. She added the TRPA is even more of a democratic agency than some others in that the majority of its members are elected officials. The three representatives from each of the counties are elected and the Secretary of State, an elected official, is acting as TRPA board member. Therefore, there is far more recourse and accountability on the part of the members of the TRPA than there is in most agencies. She reemphasized that approval of A.B. 202 would result in a legal morass and the unnecessary expenditure of taxpayers' money. Jan Gilbert of the League of Women Voters briefly spoke to oppose A.B. 202. She mentioned the need for a broad based representation on the board of the TRPA. She felt it inappropriate to have an elected board and urged the defeat of A.B. 202. Rochelle Nason, League to Save Lake Tahoe, strongly opposed the bill. The League is very involved in a wide variety of partnership efforts with the gaming industry, the ski industry and the local chambers of commerce. Some of the groups involved are the Tahoe Transportation Coalition, the Tahoe Center for a Sustainable Future, the Forest Health Consensus Group and the federal working group attempting to obtain funding for various environmental issues in the basin. All of these efforts are predicated on a strong and broadly representational TRPA. If that ceased to exist, as this bill proposes, the many years of effort would be wiped out and there would be absolutely no benefit in that. She mentioned this bill is not about elections versus appointments. Elections are currently possible. Any local jurisdiction that chooses to select its local representative by holding a referendum as part of its election process can do that. That is something that should be decided by each jurisdiction on its own basis and there is nothing in the compact that prevents that. Ms. Nason pointed out the TRPA is not a taxing body; it has no taxation power except for the very limited power set forth in the transportation section of the compact. The local jurisdictions are the ones who impose taxes and for that reason, local jurisdictions may prefer that their representative to TRPA be a member of their own body so the same person is exposed to both the budgetary and taxation issues of the local area as a whole and to the planning issues that go on in TRPA. She reiterated this bill was a bad idea and a mistake and urged a vote against A.B. 202. Mr. Harrington asked Ms. Nason if she would be opposed to having one or two representatives directly elected so that local interests were represented as well as outside interests. Ms. Nason replied they would have no objection to having six of the members elected but that should be decided by the local jurisdictions and not be mandated by the legislature. Mr. Harrington surmised if that is what happened, no one would fight against it or file any lawsuits. Ms. Nason indicated the compact currently permits up to six to be elected. She did not want it imposed, however, because of the taxing issue. This would create representatives who would not be accountable to the governing bodies of the local jurisdictions. Mr. Bache wanted to clarify that currently, a county could create a position by electing a representative to the TRPA. Ms. Nason affirmed they could do that and it would be fine except they would not support any legislative insistence they do that because that could create intergovernmental conflicts that would not be healthy for government administration. The decision should rest with the county. Mr. Joe Johnson, representing the Sierra Club, wanted to go on record as opposing A.B. 202. Mr. Bennett requested the Legislative Counsel Bureau to research A.B. 202 to see if elections are actually feasible or proper or can be held because all he sees is the word "appointment". Mr. Bache indicated the appropriate research would be done. He concluded the hearing and apologized to anyone who did not get to testify. He also appointed a subcommittee on A.B. 189. Chairman of the subcommittee would be Mr. Ernaut with members to include Mrs. Braunlin, Mr. Neighbors and Mr. Bache. The meeting was adjourned at 1:15 p.m. RESPECTFULLY SUBMITTED: Denise Sins, Committee Secretary APPROVED BY: Assemblyman Douglas A. Bache, Chairman Assemblyman Joan A. Lambert, Chairman Assembly Committee on Government Affairs March 13, 1995 Page