MINUTES OF THE ASSEMBLY COMMITTEE ON WAYS AND MEANS Sixty-eighth Session March 6, 1995 The Committee on Ways and Means was called to order at 8:02 a.m., on Monday, March 6, 1995, Chairman Arberry presiding, in Room 352 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Mr. Morse Arberry, Jr., Chairman Mr. John W. Marvel, Chairman Mrs. Jan Evans, Vice Chairman Ms. Sandra Tiffany, Vice Chairman Mr. Dennis L. Allard Mrs. Maureen E. Brower Mrs. Vonne Chowning Mr. Jack D. Close Mr. Joseph E. Dini, Jr. Mr. Thomas A. Fettic Ms. Chris Giunchigliani Mr. Lynn Hettrick Mr. Bob Price Mr. Larry L. Spitler COMMITTEE MEMBERS ABSENT: None STAFF MEMBERS PRESENT: Mr. Mark Stevens, Fiscal Analyst Mr. Gary Ghiggeri, Deputy Fiscal Analyst Chairman Arberry explained testimony would be taken out of order, beginning with the hearing on A.B. 116. ASSEMBLY BILL 116 Repeals prospective expiration of statute creating Nevada Commission for Women. Assemblywoman Marcia de Braga, Assembly District 35, stated A.B. 116 reauthorized the Nevada Commission for Women. She explained the commission was established to study the changing and developing roles of women in society, including the recognition of socio-economic factors that influence the status of women. The commission's numerous accomplishments since its creation in 1991 included publication of a domestic violence handbook for victims and professionals, co-sponsorship of a statewide mandatory conference on women and children in the courts for all Nevada family court judges, publication of a women's legal handbook, and coordination of training in suggested health care protocols for treating victims of domestic violence for health care professionals statewide. Mrs. de Braga testified the commission was scheduled to sunset July 1, 1995. Approval of A.B. 116 would remove the sunset provision. Mr. Marvel asked if the Governor recommended approval of A.B. 116. Mrs. de Braga indicated there was a fiscal note attached to this bill, but the fiscal note was not required. This legislation would only remove the sunset provision. A separate request for funding appeared in the Executive Budget. Mr. Stevens noted the Governor had recommended a $50,000 General Fund appropriation for the commission in the first year of the biennium and $41,050 in the second year. Mrs. De Braga noted 38 states had women's commissions. Of those 38 states, Nevada was the only state without funding. Mrs. de Braga introduced Ms. Paula Quagliana, Chairman of the Women's Commission. Ms. Quagliana explained the commission was comprised of several committees. The legislative committee polled women in the state to determine issues for the Legislature to consider. The economic parity committee researched business opportunities for women. The judicial committee provided training for judges. The education committee dealt with non-traditional job training and parity in education. The domestic crisis committee investigated and disseminated information about domestic violence. The child care committee worked to get businesses to provide child care facilities. Ms. Quagliana stated the commission had produced the first training session for judges related to the economic impact of divorce on women and children and the influence of the family court. Over the past three years the commission had distributed copies of a domestic violence handbook printed in both English and Spanish. The commission was currently preparing a legal handbook for women. Ms. Quagliana reiterated the Nevada Women's Commission was the only mandated commission among 38 which did not have a budget. Utah's commission had the smallest budget at $50,000, and California's commission had the largest at $500,000. She noted women's commissions throughout the country were working to access federal funding provided by the Violence Against Women Act. If the Nevada Women's Commission had adequate funding, it could implement programs which could be eligible for federal funding. Ms. Quagliana pointed out welfare, teen pregnancy, and domestic violence were issues which influenced women, children, and families. She stated the commission's programs could help women get off welfare and encourage young women to pursue higher education. She added the Nevada Women's Commission was the only state commission which focused on these issues and which could relieve taxpayers from paying for welfare. She said the purpose of the commission was to make women taxpayers rather than tax receivers. Mr. Allard asked how many women the commission had helped get off welfare. Ms. Quagliana responded the commission was putting in place programs which would help women get off welfare. She said there was no way to measure the number of women who had actually gotten off welfare as the result of a specific program. She pointed out the commission was comprised of ten members and had no funding. Members were required to spend their time doing fund raising rather than working on the projects themselves so the process would be very slow. Over the past four years the commission had investigated the issues and tried to put programs in place. She expressed the belief the commission would be effective in getting women off welfare once programs and funding were in place. Mr. Allard asked if Ms. Quagliana knew whether any women had gotten off welfare with the assistance of the commission. Ms. Quagliana stated she did not know. Mr. Marvel asked how much funding the commission received in the last biennium. Ms. Quagliana replied approximately $17,000 had been received as the result of the fund raising efforts of each committee chairman. Ms. Quagliana said she believed it would be wrong to eliminate the Nevada Women's Commission. She asked the committee to remove the sunset clause. She noted a number of women had signed petitions in support of A.B. 116. Ms. Giunchigliani requested a list of the commission members. Ms. Quagliana agreed to provide the list. Ms. Brower asked Ms. Quagliana to provide information regarding how many women had been helped by the commission's programs. Ms. Quagliana agreed to provide the information. Mr. Close asked what would happen to the Women's Commission if the budget was not funded. Mrs. de Braga said the commission would continue to function and would continue to seek private funding. Chairman Arberry called for public testimony in support or opposition to A.B. 116. Attorney General Frankie Sue Del Papa expressed her support for A.B. 116. She pointed out the Governor's proposed crime bill included funding for domestic violence and she perceived a relationship between the Women's Commission, the Attorney General's Office, and the statewide task force on domestic violence. Ms. Holly Van Valkenburgh, Public Policy Chairman, American Association of University Women, read a letter from the organization's state president in support of A.B. 116 (see Exhibit C). Ms. Jan Gilbert, League of Women Voters of Nevada, spoke in support of A.B. 116. She noted the commission had accomplished a great deal on limited funding. She said the League of Women Voters supported state funding of the commission's budget. She commended the commission members for their work. Ms. Bobbie Gang, Nevada Women's Lobby, urged support for A.B. 116. In addition, she read a letter from the Nevada Federation of Business and Professional Women in favor of A.B. 116. Ms. Alicia Smally, Nevada Association of Social Workers, expressed support for A.B. 116. Senator Bernice Mathews, expressed support for the commission. She noted she had been one of the first members appointed to the commission. She stated the focus of the commission was families. Ms. Sherri Lakin, Nevada Eagle Forum, spoke in opposition to A.B. 116. She questioned why the Women's Commission should be funded with taxpayer money when other organizations were not. Ms. Janine Hansen, President, Nevada Eagle Forum, said she was also speaking on behalf of Ms. Lucille Lusk. She said Ms. Lusk was formerly a member of the commission who resigned because of the commission's slanted agenda. She expressed opposition to removing the sunset clause. She noted her organization frequently worked in opposition to the Women's Commission, and she resented the organization being named the Women's Commission when many of the women in Nevada were not in agreement with the commission's agenda and were not represented on the commission. She noted the commission had access to bill drafting, etc., which other organizations did not. She said it was wrong to fund a special interest lobby. She pointed out all funding for Eagle Forum came from private donations. Mr. Price asked Ms. Hansen if she felt all state commissions represented special interests. Ms. Hansen said she was unfamiliar with the activities of other commissions. She said she was concerned with the Women's Commission because of its active involvement with the Nevada Women's Lobby, which was frequently opposed to the position of Eagle Forum. Mr. Price pointed out the commission did not have direct access to bill drafting. Ms. Giunchigliani said she was frustrated by opposition to the commission from a vocal minority which was based on fear. The issue and intent of creating a commission was to bring focus to problems and to work towards remedies. If the Women's Commission chose to work with any organization, including Eagle Forum, toward that end, that was the responsible thing to do. Senator Mathews stated the only interest of the commission was what happened to families. ASSEMBLY BILL 80 Revises provisions governing certain grants of financial assistance made by Commission for Cultural Affairs. Assemblywoman Gene Segerblom, District 22, asked Ms. Brenda Erdoes, Legislative Counsel, to explain the history of the Commission for Cultural Affairs. Chairman Arberry noted Senator Mike McGinness was present. He invited him to comment on the bill. Senator McGinness expressed support for A.B. 80. He commented there were tremendous historical assets in the rural areas of the state, which none of the individual rural communities had the ability to fund. In the past, funding for the Commission for Cultural Affairs had been put to good use in preserving those assets. He noted local communities also supplied funding toward historic preservation, and this program represented a good partnership between local and state organizations. Ms. Erdoes testified in 1991 legislation was passed appropriating $20 million in bond proceeds to be used at the rate of $2 million per year. Unfortunately, the legislation provided that the bonds would be outside the state debt limit on the basis of protecting cultural resources. A court test determined cultural resources were not natural resources. Therefore, the bonds could not be outside the state debt limit. The bonds were never issued. A.B. 80 included the bonds within the state limit. Ms. Giunchigliani asked fiscal staff to provide information on the impact approval of A.B. 80 would have on the state's overall bonding capacity. Mr. Marvel said he was delighted this problem had been resolved. He expressed his support for A.B. 80. He said it was time Nevada became active in preserving its cultural resources. Mrs. Chowning noted the commission had done a lot of work in her district and the work was very much appreciated. Ms. Giunchigliani requested a list of commission members. Ms. Mimi Rodden spoke in support of A.B. 80. She noted all 17 counties of the state of Nevada would be positively impacted by the passage of this legislation and it would set a standard for other states. She said the need had been demonstrated for Nevada to recognize and enhance its cultural properties. The significant historical properties would, in turn, serve the local communities and the state as a whole by housing public interest activities. They would generate interest both nationally and statewide and would make people aware that Nevada had more than just gambling and crime. She said heritage tourism was of global interest and had a strong economic base. She suggested it was fitting time to make a permanent commitment to a long-range program of cultural preservation. Nevada heritage, coupled with collective art programs, was emerging as one of the most promising areas of economic development. She urged the committee to support A.B. 80. Mr. Allard asked what the criteria for distributing funds was. Mrs. Segerblom introduced Mr. Renny Ashelman, ex officio member of the Nevada Cultural Commission, to respond to the question. Mr. Ashelman said the criteria for granting funds included the extent of local participation (funding as well as volunteer efforts), the cultural value of the property, and ability to complete the project or a significant portion of the project to make it available and useful to the public. Mr. Allard inquired whether matching funds were required from the local communities. Mr. Ashelman replied local communities were required to make a matching effort commensurate with their resources and the size of the project. Ms. Giunchigliani asked the criteria for determining grant recipients and whether it was legal to use public tax dollars to fund privately owned projects. Mr. Ashelman stated that legal question had been dealt with very carefully. He explained in the only case where the issue would arise the money was being utilized by a non-profit organization. The Attorney General had reviewed this case to ensure the grant met state limitations. Ms. Giunchigliani inquired how grants were disbursed throughout the state. Mr. Ashelman pointed out Clark County had entered the application process later than other applicants, and therefore, appeared to receive a lesser share of funds. He expected in the future more grants would go to Clark County projects. Ms. Giunchigliani questioned whether applicants which had previously received a grant could be approved again for an additional grant. Mr. Ashelman said it would depend on the project. Some grants funded only a portion of a project, and the applicant could apply for grant funding in the future to complete the next piece. Other grants were large enough to complete a project. Ms. Giunchigliani asked if applicants could use in-kind matches as well as matching funds. Mr. Ashelman answered affirmatively. He noted none of the applicants had relied solely on in-kind matches. Ms. Giunchigliani said she would like to see the criteria for granting funds. Mr. Ashelman explained the criteria were listed in the statute. Vice Chairman Evans called for public testimony. Ms. Tara McCarty, Executive Director, Elko Western Folklife Center, said her organization had received a grant from the Commission on Cultural Affairs during the last legislative session. She explained the Western Folklife Center was a private, non-profit organization whose mission was to preserve and present the folk art of the American west, including the annual cowboy poetry gathering. The grant funds were used to extend cultural events throughout the year, which would benefit the local community in terms of tourist dollars. She said Elko represented an exemplary example of how grant funds could be used and could provide leadership for other rural applicants. She urged support for A.B. 80. Ms. Christine Fey, Assistant Planner, City of Reno, said Reno had received funding for McKinley Park School. She said over 1,000 citizens per week utilized the school for various programs. In addition, the school served a number of tourist groups. She noted grant funds enabled local governments to rehabilitate their cultural resources to help revitalize their economies and, in turn, the state economy. She suggested a long-term commitment to restoration of cultural resources would be helpful. Mr. Max Hershenow, President, AIA Nevada, echoed the comments of Ms. Fey. He said the architects of Nevada wholeheartedly supported rehabilitation of cultural resources. He noted this program represented a strong local-state partnership which would allow continuation of these efforts. Mr. Kirk Robertson of the Churchill Arts Council stated a grant from the Cultural Commission, together with private matching funds, had allowed the council to renovate the Oats Park art center. This project would have not been possible without the grant. Mr. Mark Arrighi stated he served on the board of Yerington Grammar School, one of the grant recipients. He said construction of the Yerington School was underway. Yerington had raised $700,000 in private funds to supplement the $400,000 grant. It was anticipated the final $200,000 to $300,000 needed to complete the project would be raised over the next three months. He expressed his support for A.B. 80. ASSEMBLY BILL 203 Establishes program for payment of bonuses to state employees. Assemblyman David Goldwater, District 10, testified A.B. 203 revised the merit award system for state employees. He explained the current system required a legislative appropriation and a great deal of bureaucracy for a state employee to receive an award. The goal of A.B. 203 was to reward state employees who correct inefficiencies in their department, thereby creating an incentive for employees to operate in the most cost efficient manner possible while providing the best kind of service to the citizens of the state. The reward would constitute either 10 percent of the employee's salary or $2,500, whichever is less or whichever is recommended by the merit award committee. Mr. Goldwater stated the current merit system did not work since funds were rarely appropriated for it by the Legislature. Therefore, the concept of a reward did not seem real to state employees. A.B. 203 proposed to have the Interim Finance Committee and a merit award committee review applications for awards and, if appropriate, issue an award check to the applicant. Mr. Marvel inquired whether this program would require one-time or ongoing funding. Mr. Goldwater replied passage of A.B. 203 would change the present system from requiring an appropriation from the Legislature to allowing funding from departmental cost savings. Mr. Marvel asked if the award recipient would be eligible only one time. Mr. Goldwater responded affirmatively. Mr. Allard asked if "whistle blowers" would be eligible for an award, i.e., from savings realized from stopping employee theft. Mr. Goldwater said the Interim Finance Committee would probably not recognize reduction of employee theft as legitimate departmental savings. The bill was not intended to pay for frivolous savings and did not focus on whistle blowing. Mrs. Evans said she liked the thrust of A.B. 203. She asked what the impact of having two employee organizations would be on the makeup of the merit award committee. Mr. Goldwater said the chief executive officer of the agency would nominate a representative from one of the two employee organizations. Mrs. Brower said it appeared A.B. 203 would provide an incentive for employees to look for cost savings. She asked if award recipients would be required to be directly responsible for departmental savings. Mr. Goldwater said Mrs. Brower was correct. Ms. Carole Vilardo of the Nevada Taxpayers Association expressed support for A.B. 203. She explained Interim Finance Committee review of the awards was to provide an additional level of control and to maintain a record of cost savings which could be applied to other departments. She said the Nevada Taxpayers Association was confident the bill had been drafted to provide awards only when legitimate savings were generated. She also noted employee involvement was an important component in making state government more efficient. She urged the committee's favorable consideration of A.B. 203. Mr. Gary Yoes, Political Action Coordinator, Service Employees International Union, expressed support for A.B. 203. He echoed Ms. Vilardo's statements that employees were in an excellent position to identify inefficiency and areas for cost savings in state government. He said A.B. 203 created an incentive for state workers to help create programs which would benefit the public and the taxpayers. It also created a mechanism through which management and labor could work cooperatively in delivering cost savings and efficient service to the public. He commended Mr. Goldwater for introducing A.B. 203. He strongly urged the committee to recommend passage of this legislation. Mr. Fettic asked if there would be problems in selecting the employee organization nominee to the merit award committee in agencies whose employees were represented by more than one employee organization. Mr. Goldwater said a small degree of trust would be required on both sides to work out any disputes. Mr. Fettic said in his experience the process had not been as simple as Mr. Goldwater portrayed. Mr. Hettrick said he would like A.B. 203 to reflect that non-union employees could select a nominee for membership on the merit award committee. He also noted the bill might have to be adjusted to allow time and a mechanism for transferring funds to this program. Finally, he questioned what would happen if the excess funds returned to the General Fund caused the reserve account to exceed $100 million. Ms. Tiffany asked if a sunset clause had been considered. She said she would like to see some data gathered to support the benefit of this program. Mr. Goldwater said he would not object to a sunset clause. He noted this bill represented a beginning. Ms. Tiffany asked Ms. Vilardo for her opinion of a reasonable time period during which to collect the necessary data. Ms. Vilardo suggested four years would allow time for the program to be implemented and tested. Ms. Tiffany inquired whether measurement indicators should be developed for this program. Ms. Vilardo stated the purpose of having the Interim Finance Committee prepare the application forms was to provide a central clearing place to evaluate the program and make recommendations. Mr. Dini noted there was a constitutional question of how much responsibility should be delegated to the Interim Finance Committee without abrogating the obligation of the Legislature to perform its duties. He requested a Legislative Counsel opinion regarding whether this measure would violate any constitutional requirements. ASSEMBLY BILL 33 Repeals obsolete provision relating to disposition of balance in abandoned property trust fund. Ms. Connie Longero, Administrator, Unclaimed Property, testified the intent of this legislation was to repeal a portion of Section 51.2 of Chapter 682 of Statutes of Nevada (1979) which presently requires any remaining balance in the abandoned property trust fund on July 30, 1994, to escheat to the state for credit to the state permanent school fund. She explained the language should have been removed in 1985. This oversight was discovered in a legislative audit. Mr. Price inquired whether abandoned property included property other than cash. Ms. Longero stated the contents of safe deposit boxes were considered abandoned property, but those contents were eventually converted to cash. Mr. Crews, Legislative Auditor, affirmed Ms. Longero's testimony. ASSEMBLY BILL 130 Revises provisions governing agency for nuclear projects and state Department of Conservation and Natural Resources. Mr. Pete Morros, Director, Department of Conservation and Natural Resources, spoke in support of A.B. 130. He said the Agency for Nuclear Projects was located in the Department of Conservation and Natural Resources as a result of the reorganization legislation of 1993. The amendments set forth in A.B. 130 would bring the Agency for Nuclear Projects up to the same level as the other nine agencies or divisions in the department in relation to the appointing authority of the administrator of those agencies. All agencies within the Department of Conservation and Natural Resources at the present time serve at the pleasure of the Director, with the exception of Nuclear Projects. Passage of A.B. 130 would clearly set forth the responsibilities of the Director related to the agency as well as the responsibilities and role of the Nuclear Projects Commission. Mr. Morros noted the reorganization placed two agencies in the Department of Conservation and Natural Resources: the Wildlife Department, which was reduced to a division status; and Nuclear Projects. The reorganization legislation amended the appointing authority related to the Division of Wildlife and provided that the Director would appoint the administrator of that division, and that administrator would serve at the pleasure of the Director. The legislation did not address the appointing authority for the administrator of the Agency for Nuclear Projects. He suggested it should be made clear whether or not the Director of the Department was responsible for the agency. Mr. Morros added there seemed to be some notion that A.B. 130 represents a change in the state's policy of opposition to the repository at Yucca Mountain. He said he did not know where that idea came from. It was not emanating from the Director's office. The state's policy and law in regard to Yucca Mountain is firm. He indicated he had no discussions with anyone about a change in that policy, and said he wholeheartedly supported that policy regardless of the outcome of A.B. 130. Mr. Marvel asked what the intent of reorganization of the last session was. Mr. Morros responded the primary thrust of the reorganization was to try to reduce the number of departments and independent small agencies. Reorganization was designed to streamline government, bring the agencies under cabinet leadership, and reduce the number of agencies without any accountability. Mr. Marvel asked if Nuclear Projects was transferred to the Department of Conservation and Natural Resources. Mr. Morros responded affirmatively. Ms. Tiffany said she agreed that Mr. Loux should report to Mr. Morros, but disagreed that Mr. Morros should have appointing authority. She pointed out the Governor appointed the Executive Director for Economic Development and Tourism, and the Lieutenant Governor is accountable for the actions of that position. She questioned why Mr. Morros wanted appointing authority. Mr. Morros stated the change would bring consistency with every other division administrator in the department. He said he wanted to be able to choose his own administrators if he was going to be responsible for their actions. Mr. Morros noted the Environmental Commission, the Wildlife Commission, and the Conservation Commissions were regulatory commissions, but none of those commissions served as appointing authorities. He questioned why the Nuclear Commission should be any different. Ms. Tiffany inquired if Mr. Morros would recommend that this be an outside agency with independent status. Mr. Morros stated he would prefer not to have an independent agency in his department if he was responsible for that agency. Mr. Price stated he was inclined to keep the Agency for Nuclear Projects as independent as possible because of its uniqueness. He saw the agency as carrying out and espousing the policy of the Governor and the State of Nevada. He asked Mr. Morros if he was speaking on behalf of the Governor, and if the Governor supported A.B. 130. He also requested a presentation from the Governor's office about this matter prior to the committee taking any action. Mr. Morros said absent A.B. 130 he would have proposed his own legislation, which he had reviewed with the Governor's office and which the Governor's office indicated they had no problem with. Mr. Price asked if that proposed legislation had been approved by the former administrator. Mr. Morros said his contact in the Governor's office was Margaret Springgate. Mr. Price asked again if the Governor supported A.B. 130. Mr. Morros said he did not know if the Governor supported A.B. 130. Mr. Price questioned whether Mr. Morros should know the answer to that question before coming before this committee asking for a change of a cabinet level administrator. Mr. Morros stated he was told the Governor was not opposed to the bill, and the bill could be introduced. Mr. Price said he would like to receive a statement from the Governor regarding A.B. 130. Mrs. Evans asked why the Agency for Nuclear Projects was originally set up under the Governor. Mr. Morros said he did not know the reason for putting the Agency for Nuclear Projects in his department. He said he did not lobby for it. He did not support or oppose it. He understood the decision was made at the Governor's level and was supported by the Legislature, and he took no active role in the process. Mrs. Evans again asked why it was originally felt the agency should be placed under the authority of the Governor. Mr. Morros said he thought it was a question of accountability. Ms. Giunchigliani said she appreciated the dilemma that Mr. Morros was in. She noted in some cases the intent of the state government reorganization was not realized. She pointed out, however, there were independent agencies located within other departments. She noted Nevada had maintained a consistent policy regarding the nuclear industry. That consistency had given Nevada a strong position and needed to be maintained. She suggested the Agency for Nuclear Projects should be returned to its pre-reorganization status, i.e., as an independent agency accountable to the commission and to the Governor so that the policy of the State of Nevada remains clear. She asked Mr. Morros if he would support such a change. Mr. Morros stated that was a decision that had to be made by the Governor. He said he assumed the agency had been put in his department for a reason. Ms. Giunchigliani asked what Mr. Morros' position would be if the Legislature returned the agency to independent status. Mr. Morros replied his position would be the same as the Governor's. Ms. Giunchigliani questioned why, then, Mr. Morros was testifying on A.B. 130 without the Governor's support. Mr. Morros responded he was testifying in support of A.B. 130 on the basis of the agency remaining in his department. He indicated he did not object to moving the agency out of his department. Ms. Giunchigliani inquired whether Mr. Morros would support such a change. Mr. Morros said he would support whatever the Governor wanted him to do. Ms. Giunchigliani asked if Mr. Morros would oppose A.B. 130 if the Governor wanted to oppose the bill. Mr. Morros answered affirmatively. Mrs. Brower asked if Mr. Morros would entertain the possibility of making the appointment of the Executive Director of the Agency for Nuclear Projects a cooperative effort with the Governor's office. Mr. Morros stated he had no problem with such an arrangement as long as the Executive Director served at his pleasure in the same manner as the other division administrators within his department. Mr. Dini said he understood Mr. Morros' position that he should be able to control an agency within his department, but it might be appropriate to move the agency back to the Governor's office. He noted the Agency for Nuclear Projects served to help the Governor fight a nuclear dump in Nevada and to develop a statewide policy. Moving the agency back to the Governor's office would avoid debating this issue every legislative session. Mr. Close asked Mr. Morros if A.B. 130 were to pass, if he would hire Mr. Loux to be Executive Director of the Agency for Nuclear Projects. Mr. Morros stated he did not want to respond to the question. If A.B. 130 were to pass, he and Mr. Loux would deal with the issue at that time. Mrs. Chowning expressed her opinion that personalities and names should be kept out of this discussion. The committee's job was to establish policy. Mr. Fettic echoed Mr. Dini's comments. He noted it seemed unfair to give responsibility for an agency to a department head without giving authority over that agency. Chairman Arberry asked Mr. Morros if he had any closing remarks. Mr. Morros reiterated any attempt to tie A.B. 130 to the existing policy on Yucca Mountain was without merit or foundation. He said he clearly understood the state's policy in regard to Yucca Mountain. Mr. Spitler said he was happy to hear Mr. Morros supported the state's policy. He noted, however, he had received several letters and telephone calls indicating A.B. 130 reflected a movement to change the state's philosophy regarding Yucca Mountain. He distributed copies of letters received from Myrna Williams and Grant Sawyer and asked that they be entered into the record (see Exhibits D and E). Chairman Arberry called for pubic testimony. Ms. Michon Mackedon, Vice Chairperson for the Commission on Nuclear Projects, submitted two letters for inclusion in the record. One was the aforementioned letter from Commission Chairman Grant Sawyer (see Exhibit E). The other was a letter of support for maintaining the independence of the Nuclear Projects Office from Mayor Jan Laverty Jones of Las Vegas (see Exhibit F). She stated the Agency for Nuclear Projects was established to handle one specific, highly volatile, highly political, high-profile issue in the state of Nevada. Ms. Mackedon said she had served on the Nuclear Projects Commission for 10 years. She noted one advantage of the commission serving as appointing authority and policy setting authority was its extremely well balanced makeup, including representatives from the city, the county, appointees of the Governor, and representatives from the Legislature. Not only is the commission sensitive to grassroots issues, but it also guarantees a balance of power that puts Nevada in a position to be sensitive to all of the various constituencies within the state. Ms. Mackedon noted there was a potential for conflicts with other agencies within the Department of Conservation and Natural Resources. There might be potential conflicts of legislation related to water issues and nuclear issues which could conceivably put Mr. Morros in a difficult position as those kinds of lawsuits may not necessarily be compatible between one of his divisions and another on the nuclear issue. Ms. Mackedon said the issue of accountability had been addressed several times in this hearing. She stated the Commission had been extremely responsible in its relationship with Mr. Loux and his office. The commission held frequent meetings and reviewed the budgets. Most significantly, the commission was extremely well tuned to the policy of the State of Nevada in terms of nuclear issues. Ms. Mackedon stated the Agency for Nuclear Projects had been successful in networking with other states to enlighten the citizens about the impact of the transportation of high-level nuclear waste through their states. As a result people throughout the United States were becoming aware that this is not simply a Nevada issue. She pointed out Nevada was beginning to win the battle to keep high-level nuclear waste out of the state. Mr. Robert Loux, Executive Director of the Agency for Nuclear Projects echoed Ms. Mackedon's comments. He said there was beginning to develop a national awareness about nuclear waste, and Nevada's point of view was becoming understood across the country. He indicated the commission had been quite successful in directing the Agency for Nuclear Projects. Mr. Don Schlesinger stated he had served as a member of the Nuclear Projects Commission for three years. He noted his successor on the commission would be former Assemblywoman Myrna Williams. He said he was confident the seat would be in excellent hands. He reiterated the sentiments of Ms. Mackedon and Mr. Loux. He emphasized there was a growing national awareness of the nuclear waste issue. He said Nevada would not have received this kind of support without the commission's initiative and the work of Mr. Loux and his staff in carrying out the state's policies. Mr. Schlesinger commended Mr. Loux for the work he had done. He said a large part of the responsibility for carrying out the agency's agenda and the success that had been achieved was due to Mr. Loux's efforts. Mr. Schlesinger added, as a member of the commission, he would have liked to known about problems in reporting relationships and had the opportunity to discuss those with the Executive Director, with other commission members, and with the committee. He first learned about this problem through A.B. 130. Mr. Schlesinger stated he would not like the Legislature to change an agency which was working, especially since Nevada now appeared to be winning the battle due to the agency's efforts. He suggested a change at this time would not only send out the wrong signals but would be very detrimental to the initiative that has been spawned in recent years. He urged the committee to recognize that progress has been made. He said reporting concerns could be addressed without the need for legislative change. He asked the committee to consider indefinitely postponing this legislation. Chairman Marvel asked Mr. Loux if he was aware the Agency for Nuclear Projects would be transferred to the Department of Conservation and Natural Resources as part of the 1993 reorganization. Mr. Loux responded affirmatively. Chairman Marvel inquired why Mr. Loux did not object to the move at that time. Mr. Loux replied in meetings with the Governor's office it had been indicated the agency would be consolidated in the department, but essentially nothing would change relative to the reporting requirements, the appointing authority, or any of the other operations, and the situation would be workable. Chairman Marvel asked if there was anything in writing to that effect. Mr. Loux said there was nothing in writing to his knowledge. Ms. Jeanne Botts, Program Analyst, stated the Budget in Brief submitted to the committee by the Budget Director in 1993 indicated the Agency on Nuclear Projects was proposed to be located within the Division of Waste Management and Environmental Protection. The Governor had recommended that environmental protection be a separate department with the Agency for Nuclear Projects housed within the Waste Management Division of that department. The commission would have been an independent commission under environmental protection, but the Agency for Nuclear Projects was contained within a division. Ms. Giunchigliani asked Ms. Botts what the point of her remarks was. Ms. Botts said there was an organizational chart which showed the agency would have been located within the Department of Environmental Protection. She said she assumed if the original proposal had gone forward the outcome might have been very different. Ms. Giunchigliani stated in her opinion Ms. Botts' statements did not answer Mr. Marvel's question regarding whether or not the Governor put in writing his intent that the function of the agency would not change as the result of the reorganization, and at some point the committee would need to hear from the administration what their intent was. Ms. Botts stated the fiscal staff had not received anything in writing other than the Budget Director's plan. Chairman Marvel noted the agency was presently being audited by the Legislative Counsel Bureau. He asked if the audit would be complete before the end of the legislative session. Mr. Gary Crews, Legislative Auditor, stated the audit was in the preliminary survey phase. The general field work remained to be completed. If it was completed prior to the end of the session, it would be late in the session. Ms. Giunchigliani questioned whether the audit had any impact on where the agency was located. Mr. Crews responded the audit would not be addressing the organizational structure of the program or the office. Ms. Giunchigliani asked Mr. Loux if he would support moving the agency and the commission back to the Governor's authority. Ms. Mackedon stated the commission had researched other commissions in the state which report to the Governor or where appointing authority rests with the commission, rather than with a department head. She said there is ample analogy within the state to preserve the Commission on Nuclear Projects as an appointing and policy setting body as opposed to some department head. She added where the agency actually rests within state government was not the issue. The commission was concerned about the appointing authority and the policy setting authority. Ms. Giunchigliani said she appreciated Mr. Morros' position that there was no attempt to change state policy, but she suggested the nuclear industry would perceive passage of A.B. 130 as a potential weakness in Nevada's position, which could be dangerous. Mr. Price asked Mr. Loux if the Governor supported A.B. 130. He also asked if Mr. Loux was in frequent contact with the Governor. Mr. Loux said he was in frequent contact with the Governor's office regarding policy issues. He said he had not spoken to the Governor about A.B. 130. Mr. Joe Johnson, Toiyabe Chapter of the Sierra Club, testified the Sierra Club recognized the functional differences between the Agency for Nuclear Projects and other agencies within the Department of Conservation and Natural Resources. During the 1993 legislative session, the Sierra Club had testified in favor of adopting the Governor's recommendation of a cabinet level position for the environment. He said that was still the position of the Sierra Club. Mr. Johnson said he was speaking in opposition to A.B. 130 on the basis of the unique nature of the agency and the strong message passage of A.B. 130 would send regarding a weakness in the state's nuclear policy. Mr. Allard asked Mr. Loux if he would object to the Agency for Nuclear Projects being moved out of the Department of Conservation and Natural Resources and given independent status. Mr. Loux said the agency was independent prior to the reorganization and it worked well. He pointed out he was not opposed to the current situation and considered either alternative viable. Mr. Allard defended Mr. Morros' position that he did not want responsibility for someone over whom he had no direct authority. He questioned how passage of A.B. 130 could be perceived as a weakness in the state's nuclear policy. The present situation could possibly lead to other problems (e.g., Mr. Morros' resignation) which could be construed as weaknesses in the state's position. Mr. Schlesinger said the committee should be mindful that a change in the Executive Director position would be crippling to the efforts made in support of and would be inconsistent with the state policy. He said it would make sense to move the Agency for Nuclear Projects to independent status and the commission would support that action. Mr. Price said he had received a telephone call from commission member Ann Pierce who wished to go on record as opposing A.B. 130. The written testimony of John Hodder and M. Lee Dazey is attached as Exhibits G and H. ASSEMBLY BILL 13 Requires submission of proposal to issue general obligation bonds to provide grants to local governments and Department of Transportation for projects for controlling erosion and restoring natural watercourses in Lake Tahoe Basin. Assemblyman Lynn Hettrick, District 39, reported A.B. 13 had resulted from the Tahoe Regional Planning Agency (TRPA) interim study committee. He explained it represented a request to place a $20 million bond issue on the ballot for approval by the voters. He added this bond issuance would be outside the state's limit on bonded indebtedness since it related to natural resources. He noted it had been suggested the bill be amended to clarify the bonds were outside the debt limit and to specify who would sell the bonds. He said he had no objection to such an amendment. Mr. Dini asked staff what the cost of this bond issuance would be to property owners. Ms. Botts responded the cost had been roughly calculated at between $.00666 and $.0075 per $100.00 of assessed valuation. Mr. Price suggested this bill be referred to the Taxation Committee. Ms. Giunchigliani inquired how this bond issuance would affect the debt limit. Mr. Stevens stated since the issuance was outside the bond debt limit, it would not be calculated against the debt limit. He noted there was another analysis of the impact on the total amount of general obligation bonds issued, but he had not seen that analysis. He said he was uncertain whether $20 million would have a significant impact on that total. Ms. Tiffany asked if testimony before the interim study committee had accurately represented all interests. Mr. Hettrick said there had been tremendous participation in the study and virtually all sides agreed this measure needed to be taken and should be submitted to a vote of the people. Ms. Tiffany inquired whether Lake Tahoe area residents had indicated any willingness to pay additional taxes to preserve this natural resource. Mr. Hettrick pointed out this would be a statewide bond issue. He also noted Lake Tahoe was the state's third best revenue generator in terms of gaming and tourism. Preservation of Lake Tahoe was felt to be important to the economy of the state as a whole. He added Lake Tahoe residents would pay a higher proportion of the tax based on the higher assessed value of their property. Ms. Tiffany inquired whether Clark County residents had testified in support of this bond issue. Mr. Hettrick responded the bill had been heard in Las Vegas during the two-week recess and was apparently well received. Mr. Jim Baetge, Executive Director, Tahoe Regional Planning Agency, stated the bill had been passed out of the Government Affairs with one dissenting vote. Ms. Tiffany suggested the bill be clarified to reflect this would be a general obligation bond issuance. Mr. Hettrick reiterated the obligation would be less than $.0075 per $100 of assessed valuation. Mr. Dini said the way to save Lake Tahoe was to control erosion. He noted there had always been strong statewide support to save Lake Tahoe. Chairman Arberry called for public testimony. Mr. Steve Teshara, Executive Director, Lake Tahoe Gaming Alliance, said his organization represented the gaming properties at Lake Tahoe and had participated in the hearing process held by the interim study committee and had consistently testified in support of this measure. He echoed Mr. Dini's remarks and noted the cost was relatively modest in terms of the investment being made. He asked for the committee's support on this issue. Ms. Rochelle Nason, Executive Director, League to Save Lake Tahoe, expressed support for A.B. 13. She said erosion control measures were desperately needed to protect Lake Tahoe. She noted her organization had members from Las Vegas who reported Las Vegas residents were concerned with preserving Lake Tahoe. Mr. Allard commented while he was against raising taxes or fees, he supported putting this question to a vote of the people. Ms. Pam Wilcox, Administrator, Division of State Lands, noted her agency would administer this bond issue. She reported the last bond issuance was for $7 million, which paid for 15 erosion control projects in the Tahoe Basin. That measure had been very well received by the public, and there was a need for more work. Mr. Joe Johnson, Toiyabe Chapter of the Sierra Club, spoke in support of A.B. 13. He indicated the Sierra Club would take an active role in educating the public about this measure. Mr. James Nakada of the Nevada Tahoe Conservation District noted the $20 million bond proceeds would be supplemented with grant funds and other sources of income for use in this project. Mr. Baetge pointed out the cooperation exhibited by the witnesses reflected the cooperation of efforts in the Tahoe Basin. ASSEMBLY BILL 17 Makes appropriations for establishment and operation of program to provide for preparation and implementation of plans for protection and development of Lake Tahoe Basin by all interested participants. Mr. Hettrick stated A.B. 17 was also a result of the interim study. It recognized the need for cooperation among interested parties to the protection and development of the Lake Tahoe Basin. He explained the TRPA budget had been severely reduced due to California's cutbacks in funding. Therefore, it was necessary to increase Nevada's participation in joint projects. The interim study committee developed a "partnership approach" by which all interested parties could work in cooperation. Funding for the program was contingent on appearances before the Interim Finance Committee every six months to verify that all participants were working together as partners. If TRPA failed to demonstrate such cooperation, funding would be removed. Mr. Hettrick noted the Governor had recommended funding for this project in the Executive Budget. Therefore, this approval of this bill was only necessary if the Governor's budget recommendation was not approved by the Legislature. Mr. Hettrick explained California provided two-thirds of the funding for TRPA and Nevada provided one-third. In the past few years California's funding had been cut, but since 1986 California had funded approximately $2,232,000 over and above its two-thirds match for various projects at the Lake Tahoe Basin for which Nevada has made no match. It was important at this time for Nevada to provide funding to support the ongoing work of the TRPA. Mr. Close questioned whether Nevada's failure to match the $2,232,000 had been an issue in the past. Mr. Hettrick stated California had not viewed the $2,232,000 as matching funds because it was necessary over and above regular funding to support the agency. He suggested this was the view Nevada should now take. Mr. Close inquired whether California was aware of this bill or had provided input. Mr. Hettrick said he did not believe the California representatives had seen the bill, but they did not intend to match any funds pursuant to the proposed legislation. He added it was not the intent of the proposed legislation to require a match from California. The intent was simply that Nevada recognize the need. Mr. Close asked if California recognized the same need. Mr. Hettrick stated California had recognized the need in the past and provided the $2,232,000. Chairman Arberry called for public testimony. Mr. Teshara, Ms. Nason, and Mr. Johnson indicated their support for A.B. 17. ASSEMBLY BILL 233 Makes appropriation to state Department of Conservation and Natural Resources for flat file for Nevada Tahoe Regional Planning Agency to store maps. Ms. Wilcox, Executive Officer, Nevada Regional Planning Agency (NTRPA) testified A.B. 233 was to request a supplemental appropriation to cover equipment costs for the NTRPA. Ms. Giunchigliani questioned why this item was not included in the agency's budget. Ms. Wilcox said it was her understanding all equipment requests for all agencies would be handled with supplemental appropriations to utilize available surplus monies. Ms. Giunchigliani noted, as a matter of policy, funding for equipment should be included in agency budgets. ASSEMBLY BILL 22 Authorizes administrator of Division of State Parks of State Department of Conservation and Natural Resources to establish certain accounts. Mr. Wayne Perock, Acting Administrator, Division of State Parks, reported the agency had initiated A.B. 22. He noted it had been passed out of the Natural Resources Committee with a recommendation for do pass. He explained A.B. 22 would expand legislation adopted in 1993 which established a special account for sewer and water systems at Lake Tahoe, Nevada, State Park to allow the administrator of the division, with the concurrence of the director of the department, to establish special accounts for utilities, including electrical systems, in other parks. Mr. Perock stated A.B. 22 proposed imposing an additional charge on park users. The revenue generated from the additional charge would be deposited to an account for operation maintenance. Any carry overs in the account would be allowed to accumulate for use on major renovations. Mr. Close said he supported A.B. 22, but he was concerned about opening a special account. He asked what procedures would be implemented to account for the monies in the special account. Mr. Perock said internal controls had been implemented. The funds were kept separate from the funds in other accounts. Mr. John Atkins, Deputy Treasurer, requested clarification of the language of the bill. He stated the bill appeared to refer to separate bank accounts. He said the Treasurer would oppose establishment of separate accounts. If the accounts were to be maintained within the state accounting system, the Treasurer would support the bill. Mr. Stevens said fiscal staff would be recommending an amendment to the bill to clarify that the accounts would not be separate accounts for each park but separate categories within one budget account. Mr. Marvel added the Audit Division did not support the idea of separate bank accounts. ASSEMBLY BILL 72 Requires provisions relating to imposition of certain taxes for capital projects and financing construction of schools. Mr. Henry Etchemendy, Executive Director, Nevada Association of School Boards, had emanated from the findings of an interim study committee. The purpose of the bill was to require in ballot questions about imposing taxes for school construction notification of the length of time the tax rate would be imposed and a statement that the period of time may not exceed 20 years. Mr. Etchemendy expressed agreement with this portion of the bill. Mr. Etchemendy directed the committee's attention to Section 2 of the bill, which included the same provision for the 20-year limit on taxes. He noted this section would essentially eradicate the ability of school districts to establish a pay-as-you- go funding method for rehabilitation of existing school buildings. The current law allowed school districts to approach voters requesting a tax rate on a pay-as-you-go basis to save money over a period of years in order to rehabilitate existing school buildings. The 20 year limit on this provision would leave the law with no force and effect since 20 years was not a sufficient amount of time to accumulate the necessary funds. He noted the current law contained a protection on the amount of money which could be accumulated. Subsection 5 of Section 2 stated: "The property tax authorized in subsection 1 may not be imposed or collected if the account for the replacement of capital assets contains revenue in an amount equal to or more than 30 percent of the replacement value of the capital assets of the county school district." Chairman Arberry asked Mr. Etchemendy to submit a proposed amendment to the bill. Mr. Etchemendy agreed to do so. There being no further business, the meeting was adjourned at 11:17 a.m. RESPECTFULLY SUBMITTED: Dale Gray, Committee Secretary Assembly Committee on Ways and Means March 6, 1995 Page