MINUTES OF THE ASSEMBLY COMMITTEE ON GOVERNMENT AFFAIRS Sixty-eighth Session June 28, 1995 The Committee on Government Affairs was called to order at 8:00 a.m., on Wednesday, June 28, 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. William Z. (Bill) Harrington Mr. Dennis Nolan Mrs. Gene Wines Segerblom Ms. Patricia A. Tripple COMMITTEE MEMBERS EXCUSED: Mr. Pete Ernaut Mrs. Vivian L. Freeman Ms. Saundra (Sandi) Krenzer Mr. Wendell P. Williams STAFF MEMBERS PRESENT: Ms. Denice Miller, Senior Research Analyst OTHERS PRESENT: Mr. Charles E. Lawson, Nevada Rural Water Association; Mr. A. Brian Wallace, Chairman, Washoe Tribe of Nevada and California; Mr. Joe Guild, the Nevada Cattlemen's Association and Santa Fe Gold Corporation; Mr. Peter Morros, Director, Department of Conservation and Natural Resources; Mr. Doug Busselman, Executive Vice President, Nevada Farm Bureau; Ms. Julie Wilcox, Southern Nevada Water Authority and Las Vegas Valley Water District; Mr. Ray Bacon, Nevada Manufacturers Association; Ms. Gaylyn Spriggs, Rayrock Mines, Inc. and Independence Mining Company (see also Exhibit B attached hereto). SENATE BILL NO. 101 - Requires development of statewide water plan and revises provisions governing composition and duties of advisory board on water resources planning and development. Mr. Charles E. Lawson, Nevada Rural Water Association, testified. He declared there was a great deal of difference between a small, rural utility company and entities such as the Las Vegas Water District and West Pac. He explained the needs of a small rural utility company were different (from those of a large metropolitan utility company) and its resources were less. Mr. Lawson provided information about his various affiliations. Mr. Lawson referred to proposed amendments to S.B. 101 (Exhibit C) submitted to the committee prior to the commencement of the meeting and pointed out the two largest utilities in the state had been selected to have individual representation on the advisory board on water resources and planning. He said the Nevada Rural Water Association would like Nevada's rural water utilities to have a representative on the advisory board and would also like to see Nevada's Indian tribes represented. Mr. Lawson indicated, during the hearing on Senate Bill No. 96 held by the committee the previous day, the committee expressed dissatisfaction with the federal government because it was dictating to Nevada and suggested, through S.B. 101, Nevada's rural areas were being dictated to in the same manner. He said Senator Rhoads testified 87 percent of Nevada's water was contained in its rural counties. He pointed out, as the advisory board was proposed to be constituted, only three of its members would come from rural counties while the remaining members would be from Washoe County and Clark County, which presently did their own water planning. He suggested, since most of Nevada's water was contained in its rural areas, those rural areas should have greater representation on the advisory board than was being afforded them. Mr. A. Brian Wallace, Chairman, Washoe Tribe of Nevada and California (hereinafter referred to as the Tribe), testified. He indicated his purpose in appearing before the committee was to highlight some of the Tribe's values and the reason the Tribe would be interested in the discussion of how water resources in Nevada should be managed. Mr. Wallace explained, historically, Lake Tahoe was the Tribe's home and was, even at the present time, the basis of its religion. He said the Tribe believed Lake Tahoe to be "...the life-giver to not only the Washoe people but everything that lives and thrives around it." Mr. Wallace expressed hope that discussions of how water resources were to be applied for the benefit of the public would contemplate the long term costs of short term benefits and gains. He said historical management practices were designed for an empty land which was now full and contended there had been a failure to invent and adopt resource policies designed to accommodate changed needs. He suggested Nevada's Indians could make a positive contribution to discussions about water management and could impart humanity to those discussions. Mr. Wallace expressed the Tribe's support for the work being done by the State Water Planner and for the state's efforts to develop "...a management vision for the future with regard to the resources of the state...that will benefit future generations." Chairman Lambert stated, "I need to remark, for the record, since the middle of Mr. Lawson's testimony, we've officially been a subcommittee." Mr. Joe Guild, the Nevada Cattlemen's Association and Santa Fe Gold Corporation, testified. He urged the committee to support S.B. 101 as it was proposed to be amended by the amendments set forth in Exhibit C. He said a number of people had worked hard to develop those amendments and he believed they would resolve some of the concerns the committee raised during the hearing on S.B. 101 held the preceding day. Mr. Peter Morros, Director, Department of Conservation and Natural Resources, testified. He stated the Department of Conservation and Natural Resources was comfortable with the proposed amendments to S.B. 101 (Exhibit C). He advised he discussed those amendments with Assemblyman Joseph Dini and said Mr. Dini was also comfortable with them. Chairman Lambert announced the committee was once again sitting as a full committee. Assemblyman Bache referred to the proposed amendment to subsection 6 of Section 4 of S.B. 101 which would delete the requirement the chairman of the advisory board be a resident of an urban area. He said he had no concern about that amendment but did have a concern about the chairman of the advisory board being a representative of a water purveyor. He suggested someone other than a representative of a water purveyor should chair the board. Mr. Morros responded the members of the advisory board elected the chairman of the board and said he would ensure Mr. Bache's concern was made known to the board. Assemblyman Braunlin asked why the proposed amendments (Exhibit C) did not provide for a representative of the manufacturing industry to be a member of the advisory board. Mr. Guild replied to Mrs. Braunlin's question and advised, because of the amount of concern expressed, both by the committee and by various witnesses who testified the preceding day, that the general public be represented on the advisory board, it was felt provision should be made for such representation. He said, in addition, the major portion of manufacturing done in Nevada was done in the two most urban areas of the state and, because urban areas were already heavily represented on the board, it was believed manufacturers could convey any concerns they might have through the representatives of the urban areas. He indicated there were not many manufacturing companies in Nevada who owned water rights. Mr. Morros indicated he wished to augment Mr. Guild's response to Mrs. Braunlin's question. He advised most manufacturing facilities in Nevada were served by water purveyors. He explained manufacturing facilities which retained their own water rights were usually those which were located outside of municipal areas and said there were a few such facilities but the amounts of water they used was fairly small when compared with that used by some of the other interests. He suggested the representatives of water purveyors would protect the interests of manufacturers. Assemblyman Segerblom asked whether most mining interests had their own water rights. Mr. Morros replied they did. Assemblyman Tripple asked whether the water interests of the farming industry and those of the ranching industry differed from one another. Mr. Guild replied they did. He said it was possible the amounts of water used by those industries might not differ but the applications to which the water was put by those industries did differ. He suggested their conservation efforts might also differ. He proposed the farming and ranching industries would bring different perspectives to discussions related to developing a water plan for the state. Chairman Lambert asked Mr. Morros whether the proposed amendments (Exhibit C) included a change in the makeup of the water financing board. Mr. Morros replied he did not believe they did. Mr. Doug Busselman, Executive Vice President, Nevada Farm Bureau, testified by reading from prepared text (Exhibit D). He stated the Nevada Farm Bureau supported the proposed amendments to S.B. 101 (Exhibit C) which would cause the water board to be comprised of 15 members and which would add to the board representatives of the farming, mining, ranching and wildlife industries as well as a representative of the general public. He discussed other amendments supported by the Nevada Farm Bureau and said the Nevada Farm Bureau believed the changes to S.B. 101 which the proposed amendments (Exhibit C) would make would address concerns expressed about S.B. 101. Mr. Busselman indicated he wished to respond to Mrs. Braunlin's question of why the proposed amendments to S.B. 101 (Exhibit C) did not provide for a representative of the manufacturing industry to be a member of the advisory board. He said the Nevada Farm Bureau supported there being sufficient members on the advisory board to represent all interests, however, the committee, as well as others, had expressed concern the board would be too large to be workable. Mr. Busselman urged the committee to approve the proposed amendments (Exhibit C) and to recommend to the full assembly that S.B. 101 be so amended and passed. Ms. Julie Wilcox, Southern Nevada Water Authority and Las Vegas Valley Water District, testified. She said, "I (would) like to put on the record that Boulder City and Henderson are part of the Southern Nevada Water Authority." She advised both the Southern Nevada Water Authority and the Las Vegas Valley Water District supported the proposed amendments to S.B. 101 (Exhibit C) and supported separating the water financing board from the water planning board. She explained the intent was not to change either the membership or the composition of the water financing board but, merely, to separate the two boards. Ms. Wilcox advised the Southern Nevada Water Authority and the Las Vegas Valley Water District supported rural areas having more representation on the water planning board. She suggested having more rural representation would make the board more rounded. Ms. Wilcox urged the committee to pass S.B. 101 as it was proposed it be amended. Mr. Busselman asked to give further testimony. He said, as he understood the changes to S.B. 101 which the proposed amendments (Exhibit C) would make, those changes would address the problem raised concerning Washoe County's water planning process and advised the language being utilized "...reflects the same kind of language that's in the bill dealing with the Washoe County planning process..." Ms. Wilcox interjected she had caused Mary Henderson and Sam McMullen (of Washoe County) to review the proposed change they had requested be made to S.B. 101. Assemblyman Bennett referred to the proposed amendment to Section 3 set forth on Exhibit C and asked whether the financing board was to generate a plan and, if so, how its plan was to be submitted. Mr. Morros responded to Mr. Bennett's question. He said when the water planning board was created it was believed the financing board might lend some expertise to the water planning board based on the financing board's experience in financing water projects. He explained the financing board did not have a planning function. He said the financing board's primary function was to administer programs for grants and loans. Mr. Bennett asked whether the financing board would function in an advisory capacity with respect to seeking funding. Mr. Morros replied it would not. Mr. Bennett asked whether the financing board could make suggestions regarding possible sources of funds. Mr. Morros said he did not believe anything would preclude the financing board from making suggestions or recommendations to the water planning board. Mr. Ray Bacon, Nevada Manufacturers Association, testified. He stated the Nevada Manufacturers Association strongly disagreed with Mr. Guild and Mr. Morros regarding "...the deletion of manufacturing from this issue..." and with several other comments those gentlemen had made. He said a major factor in some of the expansion which occurred in southern Nevada was the fact the BMI complex's water rights were turned over to the Las Vegas water district. He pointed out 18 percent of the employment in Carson City and 24 percent of the employment in Lyon County was generated by manufacturing. He stated, "Manufacturing is growing at the rate of 13 percent in the state, which is the fastest in the country." Mr. Bacon contended the general public was adequately represented on the advisory board by those members of the board who were elected officials. He declared water was of vital interest to the manufacturing industry and the manufacturing industry should "...absolutely be included in this thing." He said, "It is critical to the state's economic development plan and the economic diversification issue..." Mr. Bennett referred to Mr. Bacon's testimony that the general public was adequately represented by the elected officials who were members of the advisory board and asked if Mr. Bacon could strengthen his argument in that regard. Mr. Bacon responded if the elected officials on a board such as the advisory board did not represent the general public then the general public had a means to change that situation. He contended the primary function of such elected officials was to represent the general public. Chairman Lambert having temporarily turned the meeting over to Vice Chairman Braunlin, Vice Chairman Braunlin announced the committee was once again sitting as a subcommittee. Ms. Gaylyn Spriggs, Rayrock Mines, Inc. and Independence Mining Company, testified. She advised both entities she represented were in favor of S.B. 101 and of the proposed amendments thereto (Exhibit C). She said those entities believed all major stake holders should be represented when discussions about water were held because water was so important to the state of Nevada. She contended it was important that the legislature set policy and that it make the final decision regarding a state water plan. Mrs. de Braga indicated she wished to address her question to either Ms. Wilcox or Mr. Guild and asked why it was proposed S.B. 101 be amended to provide six members of the advisory board, rather than representing "cities and counties," would represent "...cities and counties in the county with the largest population." Ms. Wilcox responded and said the intent of the proposed change was to cause the membership of the board to remain as it presently was, with seven members representing the county with the largest population, three members representing the county with the second largest population, three members representing rural areas and "...then adding the additional membership." Mrs. de Braga asked whether the provision that at least three members of the advisory board must be residents of counties with populations of less than 100,000 was to be retained. Ms. Wilcox indicated that provision was dealt with by item 2.e. of the proposed amendments to S.B. 101 (Exhibit C). She said the intent of the proposed amendments pertaining to the composition of the advisory board was to retain the present composition of the board with respect to its current membership and to add additional members to represent Nevada's rural areas. Discussions ensued between Mrs. de Braga and Ms. Wilcox regarding how the advisory board should be constituted. Vice Chairman Braunlin turned the meeting back over to Chairman Lambert. Mr. Guild gave further testimony. He said he believed there was a misunderstanding about the proposed amendments to S.B. 101 (Exhibit C) pertaining to the composition of the advisory board and contended those amendments strengthened the representation of rural areas on the advisory board. He said, in the past, no one who was from a rural area and who had a water right was a member of the board. Chairman Lambert announced the committee was once again sitting as a full committee. Chairman Lambert asked whether Mr. Joe Johnson was present and was advised he was not. Mr. Guild advised he had engaged in lengthy discussions with Mr. Johnson and felt safe in representing that the Sierra Club supported S.B. 101 as it was proposed it be amended. Chairman Lambert closed the hearing on S.B. 101 and advised the committee would conduct a work session on S.B. 101. Chairman Lambert asked Mrs. de Braga whether it would allay some of her concerns if the language contained in the first reprint of S.B. 101 which provided at least three members of the advisory board were to be residents of a county with a population of less than 100,000 was retained. Mrs. de Braga responded, "I don't know. I'm not making my point very well I guess." Chairman Lambert suggested Mrs. de Braga desired there be more representation of Nevada's rural areas on the advisory board. Mrs. de Braga pointed out the proposed amendments to S.B. 101 (Exhibit C) provided six members of the advisory board were to be representatives of governing bodies of those cities and counties which had the largest populations in the state. She contended that meant those six members would be people from Clark County and that the majority of those people would represent utilities. She pointed out the proposed amendments (Exhibit C) also provided for one member of the advisory board to be a representative of the largest water utility in the county with the largest population in Nevada which, she said, meant there would be one additional representative of a Clark County utility and they also provided for two members to be residents of Washoe County and for one member to represent a Washoe County Utility. She pointed out the proposed amendments (Exhibit C) further provided five members of the committee were to represent, individually, various interests and said the assumption was being made that those members would be residents of rural areas. She pointed out those members would not necessarily be either residents of rural areas or owners of water rights. She declared her point was the water planning board, which would establish water policy for the entire state, would be comprised in large part of representatives of utility companies. Chairman Lambert referred to lines 23 through 28 on page 3 of the first reprint of S.B. 101 and pointed out those lines contained new language which required at least three members of the advisory board must be residents of counties with populations of less than 100,000. She asked whether Mrs. de Braga would feel more comfortable with S.B. 101 if it was amended to include that language. Mrs. de Braga replied, "No. I'll just leave it alone." Ms. Tripple proposed S.B. 101 be amended to add two additional members to the advisory board, one to be a representative of the manufacturing industry and one to be a representative of the Indian tribes' interests. Mr. Bennett advised he concurred with Ms. Tripple's proposed amendment. Assemblyman Neighbors indicated he did not agree the size of the advisory board should be increased. ASSEMBLYMAN NEIGHBORS MOVED TO AMEND S.B. 101 IN ACCORDANCE WITH THE PROPOSED AMENDMENTS SET FORTH ON EXHIBIT C AND DO PASS S.B. 101. ASSEMBLYMAN BACHE SECONDED THE MOTION. Further discussions were held among committee members. Mr. Neighbors commented he believed it was the committee's intent that Nevada's rural areas be represented on the advisory board and asked whether Mr. Morros had any problem with that intent. Mr. Morros responded he did not and would be more than happy to inform the Governor of the committee's intent. Chairman Lambert called for a vote on the motion pending before the committee. THE MOTION CARRIED. Chairman Lambert assigned S.B. 101 to Mr. Neighbors for the purpose of making a floor statement. There being no further business to come before the committee, Chairman Lambert adjourned the meeting at 9:17 a.m. RESPECTFULLY SUBMITTED: Sara Kaufman, Committee Secretary Assembly Committee on Government Affairs June 28, 1995 Page