MINUTES OF THE ASSEMBLY COMMITTEE ON WAYS AND MEANS Sixty-eighth Session June 12, 1995 The Committee on Ways and Means was called to order at 8:05 a.m., on Monday, June 12, 1995, Chairman Morse Arberry, Jr. 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 STAFF MEMBERS PRESENT: Mr. Mark Stevens, Fiscal Analyst Mr. Gary Ghiggeri, Deputy Fiscal Analyst ********* ASSEMBLY BILL 425 Requires suspension of drivers' licenses of persons who court has determined are in arrears in payment for support of children. Mr. Fettic explained the bill requires the restriction or suspension of drivers' licenses of persons who fail or refuse to pay child support. The bill provides the possibility of the person having a license to go back and forth to work, to obtain medical care, etc. Mrs. Chowning asked for a provision for people to get a permit for visitation purposes. The initial fiscal note was $27,600. Mr. Bruce Glover, Department of Drivers' Licenses felt another staff member might be required. As an example of the impact, Mr. Fettic stated there were 10,000 people in Las Vegas who are behind in their child support payments. He explained similar measures had been enacted in several states and appears to be quite effective. In Maine the set up cost was $80,000. In the first year $13,000,000 was collected in child support payments and they are now up to $22,000,000. Mr. Marvel asked if the second reprint of the bill took the fiscal note out. Mr. Fettic stated he did not find out about not having a fiscal note until this morning. Mr. Marvel asked if another amendment was needed. Mr. Fettic stated an amendment was needed for Mrs. Chowning but was unsure about an amendment to remove the fiscal note. Mr. Marvel asked Mrs. Chowning if her amendment removed the fiscal note. Mrs. Chowning said her amendment addressed the visitation. She noted the committee voted to have visitation included as one of the exceptions. Mr. Dini asked for statistics from other states of those who did not pay child support after losing their licenses. Mr. Fettic stated he had seen no statistics on the subject. Chairman Arberry asked if the bill could apply to non paying parents in another state. Mr. Fettic stated Mr. Bruce Glover, Department of Motor Vehicles and Public Safety, had checked into the issue and reported it was not possible. Chairman Arberry asked if there was any way it could be done. Mr. Fettic recommended asking Mr. Glover. Mr. Bruce Glover, Chief of Drivers' License, Department of Motor Vehicles (DMV) and Public Safety, discussed the question of reciprocity. Several states were contacted regarding the issue. The committee was informed the law allows DMV to enter into agreements with other states. California refused to do so due to high population numbers. Chairman Arberry asked if it would be possible for reciprocity to occur if an individual requested DMV to attempt it. Mr. Glover stated he would have to defer to legal counsel to answer the question. Information would come to DMV via the district attorneys and the welfare division. DMV would send out a data mailer, notifying the person who was in arrears on child support and allowing thirty days for them to catch up before their license is suspended. No action would be taken by DMV until notification is received from the courts or welfare. Chairman Arberry asked if DMV would require additional funding if the bill passed. Mr. Glover explained a position had been requested, and funding was required for mailing and data mailers. He referred to the requested funding as a "first year shot". Approximately 10,000 to 13,000 non payers would come to the attention of DMV in an initial search. He noted upon examination of the bill as of this date, the position was not included. Mr. Marvel asked if the $27,600 cost would remain the fiscal note or if it could be amended down. Mr. Glover said the figures were based on 10,000 data mailers and postage for the initial search. He was unsure if the fiscal note could be amended down. Mr. Marvel asked if it was a highway fund appropriation. Mr. Glover stated it was. Mr. Marvel asked if child support enforcement could be used. Mr. Glover said discussions had taken place as to reimbursing the highway fund for the expenses because it is technically a general fund operation and not a motor vehicle issue. Ms. Myla Florence, Administrator, State Welfare Division, said based on discussions with the district attorneys and DMV the cost impact of the bill had been neutralized. Ms. Florence discussed the reciprocity issue and explained Maine issued 21,000 notices and only had 39 license suspensions. They have collected approximately $23,000,000 in child support payments to date. South Dakota issued 13,000 notices, had 5 suspensions and collected $200,000 in the first nine months. Massachusetts sent out 60,000 notices, had 9 suspensions and collected $600,000 after the first mailing. Ms. Florence did not believe DMV would send out 13,000 notices. The first notice would come from the Welfare Division indicating to the individual that based on the legislation in question, their license could be suspended if arrangements are not made to pay child support. Based on the experience of other states, a large number of those individuals come in after receiving the first notice. No additional burden is seen to the state or district attorneys. Mr. Marvel asked if Welfare would absorb the initial cost of the first mailers. Ms. Florence replied affirmatively. She reminded the committee there were no general fund monies in the child support enforcement program. It was envisioned the collections would far exceed whatever costs are incurred and potentially have a greater return to the general fund than currently provided. Seven states currently have similar laws; eleven are pending. Mr. Marvel referred to the measure as a "deadbeat dad" measure. Ms. Florence added "and moms". Mr. Stevens said the determination was to place an additional highway fund appropriation with DMV or whether the subsequent mailings by DMV will be from highway fund appropriation or by transferring child support enforcement dollars to DMV. Ms. Florence said given the annual returns from child support to the general fund, it would be feasible to consider a transfer from child support to DMV. Ms. Giunchigliani said DMV could identify expenses related to the program and, if costs are incurred, the fund could reimburse DMV for the costs. She questioned whether there was a statutory prohibition to do so. Another potential was to use the DMV verification fund, which contains approximately $500,000 in reserve, to offset postage costs. It would be more direct, however, to use child support enforcement funds. An accounting mechanism would have to be created to allow billing for reimbursement. Ms. Florence would like to verify with Child Enforcement personnel regarding federal prohibitions. To her knowledge she felt it could be accomplished. Mr. Fettic noted an effective date had not been included in the bill. The requested effective date was January 1, 1996, to give the agencies time to initiate the program. Chairman Arberry asked for other speakers on A.B. 425. There were none. The hearing on A.B. 425 was closed. Chairman Arberry opened the hearing on Assembly Bill 692. ASSEMBLY BILL 692 Abolishes highway patrol special account. Assemblyman Thomas Batten, Assembly District 27 introduced Sergeant Gary Wolff, Nevada Highway Patrol Association. Mr. Batten referred the committee to a handout from the Assembly Transportation Committee (shown as Exhibit C). He explained the Assembly Transportation Committee heard A.B. 422 which dealt with abolishing the highway patrol special account. The committee amended the bill as a whole by deleting Sections 1, 2, 3, 4 and 5. In a unanimous vote the committee approved appropriation of $2.3 million from the highway patrol special account fund, which originally had $6.5 million in it, to provide a 14% pay increase to the highway patrol. The money would also be used to ensure the highway patrol maintains full strength, highest quality training and increased officer's salaries for retention purposes. Mr. Batten noted the first bill to deal with abolishment of the highway patrol special account was S.B. 250. When sent to the Senate, no action was taken. DMV returned with A.B. 422 attempting to abolish the account. Testimony from DMV revealed great difficulty accessing funds in the account. A compromise was negotiated with the Fiscal Division and DMV and discussed in subcommittee and committee. He requested the Ways and Means Committee to consider a one time appropriation out of the highway patrol special account to insure the 14% pay increase. Ms. Giunchigliani expressed appreciation for the work of the Transportation Committee. She stated the budget was closed with elimination of the highway patrol special account. To ease the impact of not enough highway patrolmen, vacancy savings were removed. This allows hiring of the appropriate number of patrolmen. The salaries will be considered in the classified pay bill. Ms. Giunchigliani stated a good case had been made regarding the loss of officers due to low salaries. Mr. Gary Wolff, Nevada Highway Patrol Association, thanked all committees for recognizing the needs and problems of the highway patrol. Chairman Arberry asked for a statement from Mr. Wolff regarding the highway patrol special fund being eliminated. Mr. Wolff stated there was no problem with combining the two accounts. He indicated it was very confusing having a number of special accounts. He agreed with Ms. Giunchigliani's suggestion to appropriate funds. Mr. Ray Sparks, Acting Deputy Director, Department of Motor Vehicles and Public Safety, reminded the committee the issue generating S.B. 250, introduced by the Department of Transportation (DOT), and A.B. 422, which came out of the interim committee on financing highways, was the transfer going into the highway patrol special fund from the registration fees collected by the department was in some cases greater than the actual amount of fees being collected. A drain existed on the highway fund. This was the original genesis of the bills. A.B. 422 also contained a provision eliminating the 22% budgetary cap and language concerning NDOT permit fees. The issue of the highway patrol special fund had become complicated by other issues, such as salaries, being added to the discussion. Mr. Marvel explained the $6 collection was noted in the audit report. The $6 was received regardless of the proration of registrations. He discussed the 22% cap and stated this bill may aid in alleviating the cap . Chairman Arberry closed the hearing on A.B. 692. The hearing on A.B. 691 was opened. ASSEMBLY BILL 691 Transfers capitol police to Nevada highway patrol division of department of motor vehicles and public safety. Mr. Stevens explained staff had requested a bill draft request (BDR) on this bill. He related it was requested incorrectly or was returned incorrectly based on the subcommittee's recommendation. He understood the subcommittee's recommendation was to transfer the Capitol Police to the Department of Motor Vehicles and Public Safety. In its present form the bill would transfer the responsibility of the Capitol Police to the highway patrol. The subcommittee's recommendation would require the bill be amended and replace "highway patrol" with the "Department of Motor Vehicles and Public Safety". Mr. Marvel commented it was not the intention for the Capitol Police to lose its identity. Mr. Mike Meizel, Administrator, Buildings and Grounds, informed the committee the Capitol Police was currently under the Department of Administration. A concern of the Capitol Police was to maintain their identity. Section 7 of the bill does so. If the Capitol Police were under the Department of Motor Vehicles and Public Safety, they would be even more distinct. An amendment had been offered. Page 4, Section 7, NRS 331.140 contains "antique" language restricting the authority of the Capitol Police regardless of which department they are under. The proposed amendment would bring their authority more in line with what is needed today. The old language restricted them to take proper care "to prevent any theft, trespass on, or injury to, the Capitol building or its appurtenances...". This language restricted them to facilities even though their function is to act as peace officers. The new proposed language would say "The Chief shall take proper care to prevent any crimes on, or injury to, State property under his supervision and control, and to protect the safety of all persons thereon through the enforcement of state law or applicable local ordinance". Mr. Meizel felt the proposed amendment would broaden the authority base of the Capitol Police. The language was recommended by the Capitol Police. The second part of the amendment is to clarify the funding for the Capitol Police. Funding comes from building rent, particularly the facilities maintenance and management budget. Oversight is desired on expenditures over and above the amount budgeted each year. A two year budget has been established. It is not desired to have the DMV to ask for money over and above that budget without the concurrence of the Capitol Police. Mr. Meizel explained the intent was to have oversight on the expenditures. He suggested bill draft examine the language for possible improvement. A copy of the proposed amendments was offered for the record (shown as Exhibit D). Mr. Marvel explained part of the amendment troubled him because he felt a distinction was needed between Capitol Police and Highway Patrol. He reiterated the Capitol Police would be under DMV. Mr. Meizel explained amendments had been offered to S.B. 406, one of which was to maintain Capitol Police under DMV. Mr. Marvel commented the language needed clarifying. Mr. Hettrick wondered if the last sentence in the amendment should say "authorized budget by the legislature" rather than "anticipated expenditures must have prior approval of the legislature". Mr. Meizel felt Mr. Hettrick's suggestion would preserve the intent. Mr. Sparks, DMV, stated DMV had no problems with the proposed amendments and offered the department's cooperation on the expenditure issue. Regarding placement of the Capitol Police in DMV, Mr. Sparks explained DMV had proposed the Capitol Police be maintained as a separate section within the highway patrol for efficiency purposes. DMV was aware of the sensitivity of employees regarding identity. He stated operating the Capitol Police as a separate division would also be acceptable, although the division would be small. Ms. Giunchigliani asked for clarification on governmental heirarchy. Mr. Sparks informed the committee within DMV the largest unit is the department, then nine divisions such as the highway patrol, registration, investigations, and parole and probation. Ms. Giunchigliani suggested having the Capitol Police as a division, regardless of its small size. Mr. Sparks continued in DMV divisions are broken down into bureaus and bureaus are broken into sections. The organizational placement of the Capitol Police could be arranged as the committee felt appropriate. Mr. Bob Gagnier, Executive Director, State of Nevada Employee's Association (SNEA), testified against A.B. 691. SNEA did not believe the legislation was necessary and served no useful purpose. A reason had not been given for removal of the Capitol Police from one agency to another other than "empire building" or reorganization for the sake of reorganization. He discussed the professionalism and experience of the Capitol Police. He reiterated SNEA's opposition to the legislation. However, since budget closure had occurred, SNEA proposed several amendments to the legislation. The amendments are outlined in (Exhibit E). On Page 2, Lines 44 and 45 it was proposed to delete the brackets and change the language to "Members of the Capitol Police". It is currently specific to the Buildings and Grounds Division. On Page 3, Lines 44-46, a similar amendment was proposed. This gave the Capitol Police peace officer powers. On Page 4, the amendment presented by Mr. Meizel from the Capitol Police was supported by SNEA. Support was offered by SNEA for amendment of NRS 481.067. The section creates DMV and lists their divisions. The amendment proposed listing the Capitol Police Division. In NRS 482.540 where police officers are listed, it was proposed to add "Officers of the Capitol Police". Peace officer powers of the Capitol Police would be retained rather than make them subordinate to the highway patrol which A.B. 691 does. Mr. Danny Thompson, Nevada State AFL-CIO, echoed Mr. Gagnier's remarks. No useful purpose is seen for changing the Capitol Police. He remarked it was wrong for the Capitol Police to lose their identity. He discussed the unique functions performed by the Capitol Police. He offered support for Mr. Gagnier's amendments. Mr. Sparks commented on Mr. Gagnier's proposed amendments. If the committee placed the Capitol Police in DMV as a division or entity other than a subcomponent of the highway patrol, the issues of peace officer training and statement of authority in the bill need to be changed. As the bill is drafted the authorities are conferred based upon their status as part of the highway patrol. Chairman Arberry asked if there was more testimony, pro or con, on A.B. 691. There was none. The hearing was closed on A.B. 691. ASSEMBLY BILL 482 Extends requirement that school districts develop plan to reduce ratio of pupils to school nurses. Assemblywoman Vivian Freeman, Assembly District 24, explained the bill was requested by Debbie Cahill, Nevada State Education Association (NSEA) on behalf of school nurses. Originally the bill had a large fiscal note. The Assembly Education Committee amended the bill. Mrs. Freeman requested committee approval of the bill. Ms. Debbie Cahill, NSEA, informed the committee the appropriation had been removed from the bill. In its original state, the bill was a straight appropriation to enable districts to hire school nurses to achieve the ratio of one nurse for each 1,000 students. Some districts are fairly close to meeting that ratio but a serious shortage of school nurses exists in larger districts. In 1993 school nurses were instrumental in implementing a study on the issue. A.B. 482 extends the study for two more years. It requires school districts to develop a plan to complete a report on their progress on achieving the proposed ratio. The report goes to the state Board of Education which refers the report to the legislature. It is felt the report will help keep the issue in the forefront and emphasize the need for school nurses. Ms. Dana Balchunas, R.N., Washoe County School District, offered personal testimony on the issue. Currently Ms. Balchunas carries a caseload of 2,393 students. Noting there are 24 nurses serving 45,000 students in Washoe County, Ms. Balchunas explained the nurse's duties were to monitor and survey the health of every child in Washoe County. Teacher, clinical aide and parental input is relied upon to "put out the fires" which erupt daily. Current caseloads are more health impaired than ever before. She described students with serious impairments, such as tracheostomies, colostomies, and spina bifida who require regular monitoring and "hands on" nursing care during the course of every school day. Many students require regular medication which can be given by clinical aides, but if side effects or reactions occur, the school nurse is required to deal with the matter. Nurses are also required to screen students for visions, scoliosis, dental and hearing. Ms. Balchunas screened approximately 3,000 students during the last school year, with approximately 30% requiring follow up. ******** MRS. CHOWNING MOVED TO DO PASS A.B. 482. MS. GIUNCHIGLIANI SECONDED THE MOTION. ******** Ms. Giunchigliani asked if the study was examining the impact of full inclusion in regard to the 1000:1 ratio. Ms. Cahill stated nurses had renewed their commitment to stay on top of the issue. Nurses would work with the State Board to make sure the issue was considered. Ms. Giunchigliani reiterated the need to examine all impacts. THE MOTION CARRIED. MR. FETTIC AND MRS. EVANS WERE ABSENT FOR THE VOTE. ******** SENATE BILL 476 Revises provisions governing allocation of money from community training center account. Mr. Jack Middleton, Division of Mental Hygiene and Mental Retardation, explained the bill was introduced to eliminate a problem which had existed in the Community Training Center (CTC) program for several years. The CTC program used to be a grant in aid program and is now a fee for service program. In the most recent legislative audit it was recommended legislation be introduced to take the non reverting clause out of the legislation and make unused funds revert to the state general fund as it does in all other budgets. Community Training Center directors agreed to the change. Ms. Giunchigliani asked what the impact S.B. 476 would have on the budget closings to allocate additional revenue for the CTC budget. Mr. Middleton said the S.B. 476 would have no impact. As the law stands currently, any unused funds are divided between the training centers over and above what they are paid for a fee for service. The amount allocated during the last fiscal year was $83,699. However, this was the first time in several years funds had been available to divide. Ms. Giunchigliani asked it was possible for funds to remain at the end of the fiscal year. Mr. Middleton explained the reason a surplus existed during the last fiscal year was because Vocation Rehabilitation infused $2.5 million into support employment in the state. This meant the money appropriated two years ago by the legislature did not have to be used for that purpose. Ms. Giunchigliani asked if there would be an impact on the revenue recommended for the Community Training Centers. Mr. Middleton stated there would be none. If there was surplus at the end of the fiscal year it would go to the state general fund instead of being allocated to CTC's. Ms. Giunchigliani stated she had no problem with dividing the funds because in most budgets the desire is to build the general fund surplus at the expense of programs recommended by the legislature. ******** MR. MARVEL MOVED DO PASS ON S.B. 476. MR. ALLARD SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. MR. DINI AND MRS. EVANS WERE ABSENT FOR THE VOTE. ******** SENATE BILL 522 Requires deposit of money collected for support and maintenance of certain delinquent juveniles in administrative account for division of child and family services of department of human resources. Mr. John Sarb, Administrator, Child and Family Services Division, explained S.B. 522 was recommended by the K-12/Department of Human Resources subcommittee. It provides authority for the deposit of funds received for pay placement of youth in state facilities as a revenue item to the division as opposed to having the money credited to the general fund. He stated he had no problem with the bill. Mr. Sarb apprised the committee of other legislation (A.B. 317 and A.B. 297) which would add other court ordered expenses to parents in juvenile delinquency cases. He expressed support for this idea. These options would be exercised by the court and the division could be third or fourth in line to make its collections from parents. He did not know what effect this would have on his division's ability to make revenue targets. Chairman Arberry asked for other testimony in favor or against S.B. 522. There was none. ******** MR. MARVEL MOVED DO PASS ON S.B. 522. MR. HETTRICK SECONDED THE MOTION. THE MOTION PASSED UNANIMOUSLY. MR. DINI, MRS. EVANS AND MR. PRICE WERE NOT PRESENT FOR THE VOTE. ******** ASSEMBLY BILL 130 Revises provisions governing agency for nuclear projects and state department of conservation and natural resources. Mr. Stevens distributed proposed suggestions for A.B. 130 (shown as Exhibit F). Based on the subcommittee's closing of the nuclear project's budget, it was recommended to move the Nuclear Projects office from the Department of Conservation and Natural Resources to the office of the Governor. Two choices exist to accomplish this. A new bill draft request could be generated to initiate the suggested language or a bill could be amended to effect these changes. A.B. 130 was suggested as such a vehicle. Mr. Stevens suggested eliminating the current language contained in the bill and placing the amendment in it. Ms. Giunchigliani stated the recommendation was part of the budget closings. It also eases the concern of Mr. Morros regarding the difficulty of administering a group which is appointed by and accountable to a commission and the Governor. ******** MS. GIUNCHIGLIANI MOVED TO AMEND AND DO PASS A.B. 130 BY INSERTING THE NEW LANGUAGE CONTAINED IN (EXHIBIT F) AND REWRITING THE BILL AS A WHOLE. MRS. CHOWNING SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. MRS. EVANS, MS. TIFFANY AND MR. PRICE WERE ABSENT FOR THE VOTE. ******** ASSEMBLY BILL 232 Makes appropriation to division of forestry of state department of conservation and natural resources for equipment and aircraft maintenance. Mr. Stevens announced the fiscal staff had gone through A.B. 232 and worked with the department on revisions. A handout was distributed showing the Governor's recommendation and suggested revisions (shown as Exhibit G). Revisions were included in numbers 1, 4, 6, 10, 11, 13 and 15. Mr. Stevens noted Mr. Morros wished to comment on number 4, which would provide four radios to be used in Nevada National Guard helicopters. The suggested revisions reduce the number to two radios. Mr. Pete Morros, Director, Department of Conservation and Natural Resources, stated the changes were acceptable with the exception of number 4. By reducing the number of radios provided for the Nevada National Guard helicopters limits the ability to utilize the helicopters in an active fire situation. Air to air and ground to air communications are quite important. Limiting the National Guard to two radios limits use to two helicopters. If either radio is down for maintenance or repair, this leaves only helicopter available for use, creating a safety issue. The possibility exists of having both helicopters out of service at the same time. The radios are portable and are kept on the shelf when not in use. They provide excellent communications. The present system is erratic. Chairman Arberry suggested adding the two radios back into the appropriation. Mr. Stevens, referring to page 2 of (Exhibit G), noted amendments had been suggested to "tighten up" the language. A number of large items are included in this appropriation. It had not been recommended that line items be placed in many of the one shot appropriations, although staff suggested it be done in this case. It was felt by staff that some of large items needed to be identified in the bill. Ms. Giunchigliani asked what happens to the old radios. Mr. Morros stated the radios would be discarded because they were very unreliable. Ms. Guinchigliani asked if the new ones would be a new brand. Mr. Morros explained the new radios were more advanced technology. Ms. Giunchigliani asked what the expected life of the new radios was. Mr. Morros answered the expected life was ten to fifteen years. ******** MR. ALLARD MOVED TO AMEND AND DO PASS A.B. 232 ADDING THE TWO RADIOS BACK IN. MR. FETTIC SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. MRS. EVANS WAS ABSENT FOR THE VOTE. ******** ASSEMBLY BILL 152 Requires arbitration or mediation of certain claims relating to residential property. Assemblyman Mike Schneider, Assembly District 42, was accompanied by Joan Buchanan. He explained the fiscal note in the bill books was developed in February. The bill has been changed somewhat. CAI, a professional organization representing property managers in Las Vegas, will draft necessary paperwork for the Real Estate Division to handle the bill. When arbitration or mediation is requested, a list of arbitrators will be distributed. Clients will then pursue the issue on their own. The forms have already been developed for the division. At the end of the arbitration, the division will issue a report on the arbitration. Chairman Arberry asked if there will be any general fund monies required for staff to make the program function. Ms. Joan Buchanan, Administrator, Real Estate Division, said the division would review the staff time required to comply with A.B. 252 and would like to be able to come before the Interim Finance Committee in a year or so if extra help is needed. She noted a provision existed in the bill for the Real Estate Division to charge a reasonable fee. She noted the fee is usually about $35. She suggested setting the fee at $35 and putting in the Division's operating fund to offset the operating costs and report back to the committee. Ms. Buchanan discussed long distance phone calls as an expense. Chairman Arberry asked at what level the fee would be set. Ms. Buchanan felt $35 was appropriate for both sides. Mr. Allard disclosed he was a member of a homeowner's association. He stated he was in support of the bill. Ms. Giunchigliani asked if mediation was attempted first and then the issue was taken to arbitration and if the bodies determined if it was non binding. Mr. Schneider explained mediation or arbitration could be selected. If arbitration is selected it is determined beforehand if it is binding or nonbinding. Ms. Giunchigliani noted the bill stated all costs for mediation were borne by the parties. In the case of a homeowner's association, Ms. Giunchigliani asked who could bring issues to arbitration or mediation. Mr. Schneider stated the homeowner could bring the issue. He noted neighborhood mediation could be used for five dollars. Arbitration costs approximately $300. Ms. Giunchigliani asked if mediation and/or arbitration was an interim step which did not preclude going to court. Mr. Schneider replied she was correct. He stated a bill was before the Senate doing away with the court possibility. Ms. Giunchigliani stated she favored people having an avenue to take if they we still not satisfied. If a person loses in court, they are responsible for the other persons attorney fees and court costs. ******** MR. HETTRICK MOVED TO DO PASS A.B. 152, WITH THE UNDERSTANDING THE DIVISION WOULD REPORT BACK REGARDING FEES COLLECTED AND EXPENSES. MR. ALLARD SECONDED THE MOTION. Mrs. Chowning asked if the process was already in place with local boards of realtors. Mr. Schneider said it was there. This opens it up to a larger number of arbitrators, including the American Arbitration Association. The arbitrators will be required to take classes in associations. Mrs. Chowning asked if someone's home was taken away due to inability to pay for assessments mandated by associations. Mr. Schneider said it happened several times in Las Vegas. Mrs. Chowning asked what kind of costs were incurred. Mr. Schneider said possibly someone did not pay their association fees and when the back fees accumulate to $2000, the association sues, and the people lose their homes. Ms. Buchanan noted the Board of Realtors handled their transactions. This bill was for people in community associations. She explained 67% of those in Las Vegas are affected by CC&R's and associations. Mr. Price disclosed he was a real estate licensee and would be voting in support of the bill. He is also on the Board of Directors of an association. He noted people do not have constitutional rights in associations and commended Mr. Schneider for submitting the bill. Mr. Spitler agreed with Ms. Buchanan's comments. Ms. Buchanan noted sellers are not providing documentation to buyers. Mr. Schneider noted A.B. 152 was an all encompassing bill. It will effect mobile home parks as well. Ms. Tiffany asked if the Real Estate Division needs extra staff or equipment and if the Interim Finance Committee (IFC) had the ability to grant the funds. Mr. Stevens reminded Ms. Tiffany the Real Estate Division could charge a fee. The Division could go to IFC for a general fund appropriation, although this is not utilized except in extreme cases. Ms. Tiffany noted her support for the bill. Mrs. Chowning disclosed she was a real estate licensee and would vote on the bill. Ms. Giunchigliani asked if the effective date needed to be extended beyond October 1 for training purposes and dissemination of information to homeowner's associations. Mr. Schneider noted CIA is ready to begin education of arbitrators who require it. Some arbitrators already have the necessary classwork. Ms. Giunchigliani stated she wished to assure people with the correct expertise would be available in three months. Ms. Buchanan stated an extra month would offer a better lead time. Ms. Giunchigliani noted changes had been made in Real Estate Division, including five new positions which will not be filled until October. She suggested a January 1 start date. Discussing unconstitutional covenants and restrictions, Ms. Giunchigliani asked if the arbitrators were prepared to deal with addressing constitutional issues with associations before mediation, arbitration or court is used. Ms. Giunchigliani asked if Ms. Buchanan felt the bill would make a large impact on her division. Ms. Buchanan stated there were many issues to consider. Ms. Giunchigliani asked if January 1, 1996 was a better effective date. Mr. Andy Moline, Vice President, Community Associations Institute, informed the committee a list of arbitrators and mediators was available. Ms. Giunchigliani insisted the Division would not have their new employees working until October 1 and asked how regulations and list development could occur so the process would function efficiently. Mr. Moline explained the only responsibility the division has is to provide the information, forms, lists and to collect the fees. The arbitrators do the work. If either party is unhappy with the result, they have the right to the appeal process. The regulations referenced are found in the CC&Rs on the property of the parties involved. THE MOTION PASSED UNANIMOUSLY. MRS. EVANS AND MR. ALLARD WERE ABSENT FOR THE VOTE. ******** BUDGET CLOSINGS WORKER'S COMPENSATION FRAUD AG - PAGE 37 Mr. Stevens explained List 11 (shown as Exhibit H) shows the eleven remaining accounts not closed by the committee. Technical changes were included on the closing sheets. Others may be necessary. Mr. Stevens referred to Page 5 of Exhibit H. No actions were listed. Information was provided on new positions included in the budget and a restoration requested by the Attorney General (AG) which was taken out of the Governor's recommendation in the first year of the biennium. Ms. Giunchigliani asked how many new people the AG had asked for in the Fraud area. Mr. Stevens said there were nine. Ms. Giunchigliani stated she felt the unit was overbuilt. The fraud unit collected $496,048.67 in fines and collections. The legislature was being asked to expend between $3,000,000 and $4,000,000 to have a unit. Mr. Stevens agreed the Fraud Unit was not generating what they were spending. Ms. Giunchigliani asked how many of the nine new positions requested were for the Fraud unit. Mr. Stevens confirmed all positions were related to the budget in question. He directed Ms. Giunchigliani to the list of positions on Page 5. The Fraud unit currently has 26 positions and are requesting 9 new positions. This is contained in Decision Unit M-200 on Page 38. The Decision Unit cost was $497,000 the first year and $448,000 the second year. Ms. Giunchigliani remarked the unit was not collecting that much money. She stated she would not support additional people in this area. Mr. Price noted the Fraud unit had only been in existence for two years and the committee did not know how many cases were on appeal and other information. He thought it was too soon to expect the unit to generate the appropriate amount of money. Mr. Price questioned how much fraud was to be ignored. Ms. Tiffany asked for a review of the Fraud unit's caseload. She questioned the effectiveness and efficiency of the unit if unable to recapture costs. Mr. Stevens stated the specific caseload numbers were at his office. He reminded the committee the unit reported case numbers and collections quarterly to the Interim Finance Committee. Sharing some past figures he noted from July, 1994, to December 31, 1994, the unit opened 480 investigations, reviewed and closed 414 and was still investigating 631 cases. There were 30 arrests, 38 convictions and had an active prosecution caseload of 63. Ms. Tiffany asked how many AG's were involved. Mr. Stevens stated 26 total existing positions were authorized. He offered to compile more complete data. Chairman Arberry announced the committee wished to hold the budgets until the following day. He noted the budgets would be closed the following day. LEGISLATIVE COUNSEL BUREAU - PAGE 157 Mr. Stevens referred the committee to Page 6 of the handout. Leadership had worked with the director of the Legislative Counsel Bureau (LCB) and had brought the proposal to Ways and Means and Senate Finance Committee's consideration. The adjusted base item is for the increase in group insurance. The increase was not known at the time the budget was submitted and needs to be added to the LCB budgets. The other big item was the deletion of the requested Health, Safety and Personnel Officer in the Administrative Division. The other actions are smaller. Ms. Tiffany asked if the funds in question were outside the $1.7 million one shot request for data processing enhancements. Mr. Stevens stated the $1.7 million request was independent of this action. MR. MARVEL MOVED TO CLOSE THE LEGISLATIVE COUNSEL BUREAU'S BUDGET WITH STAFF RECOMMENDATIONS. MR. HETTRICK SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. ******** LEGISLATIVE COUNSEL BUREAU INTERIM OPERATIONS Mr. Stevens reported Leadership was still discussing this budget. He recommended the budget be held until the following day. SELF INSURED WORKER'S COMPENSATION - PAGE 721 Mr. Stevens noted this budget had been discussed in a subcommittee chaired by Ms. Giunchigliani and Ms. Tiffany. Several technical changes were listed. He believed the changes outlined by staff were adopted by the Senate Finance Committee. She felt closing the budget with staff recommendations and technical changes would be appropriate. An adjustment may be necessary later if three way insurance or other items are passed. MS. GIUNCHIGLIANI MOVED TO CLOSE THE SELF INSURED WORKER'S COMPENSATION BUDGET WITH STAFF RECOMMENDATIONS AND TECHNICAL CHANGES. MS. TIFFANY SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. ******** DIVISION OF INDUSTRIAL INSURANCE - PAGE 737 Mr. Stevens stated the budget had been held based on potential changes in the State Industrial Insurance System (SIIS). Technical changes are listed. Mr. Stevens felt the committee needed to examine (b) on Page 14 of the handout. Ms. Debbra King, Program Analyst, Fiscal Division, LCB, indicated the Executive Budget anticipated a moratorium on the group self insurance programs. None of the bills introduced so far would implement a moratorium. Under Item 2 (b), Page 14 of the closing sheet is the agency's anticipated effect of the group self insurance program coming into being on July 1. The agency needs a new Accountant to make assessments immediately, two compliance auditors to be hired after the group self insurance goes into effect and the funding kept in reserve. Mr. Marvel asked if the two positions were currently built into the budgets. Ms. King stated the positions needed to be added to the budget. MS. GIUNCHIGLIANI MOVED TO CLOSE THE DIVISION OF INDUSTRIAL INSURANCE BUDGET WITH ONE ACCOUNTANT, THE LETTER OF INTENT CITED IN NUMBER 1 OF THE HANDOUT AND THE TECHNICAL CHANGES. MR. HETTRICK SECONDED THE MOTION. Mr. Close asked if the elimination of combined audits had an effect on the workload in SIIS or Industrial Relations. Mr. Stevens said it should have no impact. Ms. King informed the committee the proposed budget closings show the proposed impact of the moratorium. They do not show the impact of the SIIS reform bills. Those bills were A.B. 552, A.B. 601 or A.B. 458. The agency provided a fiscal note on S.B. 458 which would require seven additional staff and related costs. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. STATE INDUSTRIAL CLAIMANTS ATTORNEY - PAGE 907 Mr. Stevens referred the committee to Page 15 of the handout and asked Ms. King to discuss the budget. Ms. King stated the budget closing had some technical adjustment. No impact was expected as a result of the moratorium. In the SIIS reform proposals the elimination of lump sum disability could cause some additional workload for the agency. The agency requested four additional attorneys in their S.B. 458 fiscal note and four additional legal secretaries. Mr. Hettrick suggested closing the budget with the understanding the division could come to IFC if necessary. MR. HETTRICK MOVED TO CLOSE THE STATE INDUSTRIAL CLAIMANTS ATTORNEY BUDGET. MR. DINI SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. ******** MATERNAL CHILD HEALTH SERVICES - PAGE 1113 Mr. Stevens referred the committee to Page 16 of the handout. Chairman Arberry explained a request had been received to add additional funding, $100,000 to $120,000 for dental services for at risk children. He suggested amending the budget in the above referenced amount. Ms. Giunchigliani stated she did not remember any testimony regarding the issue. Chairman Arberry stated the amount indicated would be over the 1995-97 biennium. The program would run through the Community Health Center in Southern Nevada. Ms. Giunchigliani asked if the money would be exclusive of Medicaid, and also asked if Medicaid paid for dental costs. Chairman Arberry did not have the information with him. Ms. Giunchigliani asked how the $100,000 would be expended; would it be based on need, income or other factors. Chairman Arberry explained everything was based on the same requirements as other services provided. Ms. Giunchigliani asked if the money was going to only one clinic and who owned the clinic. Chairman Arberry did not know who owned the clinic. Ms. Giunchigliani asked if it was a standard clinic where all Medicaid goes through. Chairman Arberry replied it was. Ms. Tiffany informed the committee dental was covered in the Medicaid program. Limited services are available. She remarked she had not heard anything about this issue previously. She asked where it was coming from. Chairman Arberry stated he received a letter from the clinic administrators. They are attempting to establish a program and have received equipment donations. The money would be seed money. The clinic would get matching money and provide for a part time dentist. Ms. Tiffany asked if the clinic was trying to make more services available. Chairman Arberry declared she was correct. Ms. Tiffany reiterated dental services were provided under Medicaid. Chairman Arberry said it was not provided everywhere. Mrs. Chowning supported Chairman Arberry's idea. She discussed the great need for dental care. Ms. Evans suggested holding the bill a day so Dr. Kwalik, the state health officer, could address the committee on how the Maternal and Child Health program works. The committee agreed to hold the budget until the following day. DEPARTMENT OF MOTOR VEHICLES AUTOMATION - PAGE 1751 Mr. Stevens referred the committee to Page 18 of the handout. He discussed the third line from the bottom on the expense side, "provide funding for leases for a document imager and computer equipment upgrades in accordance with the agency's five point plan" in the amount of $84,000 the first year and $771,643 the second year. The proposal was to move this funding into reserve, allow the agency to develop a plan for use of the funds and approach IFC when the plan was complete. Ms. Tiffany wished to include "after the BPR is completed" the plan would be submitted from the recommendations from the BPR and not the department. MS. TIFFANY MOVED TO ADOPT THE DMV AUTOMATION BUDGET WITH THE UNDERSTANDING THE PLAN WOULD BE SUBMITTED AFTER THE BPR IS COMPLETED AND RECOMMENDATIONS ARE FROM THE BPR AND NOT THE DIVISION. MR. MARVEL SECONDED THE MOTION. Ms. Giunchigliani noted there was no real plan. She reminded the committee some DMV staff do not want to network with others. The BPR will allow an independent body come in and do an analysis of what is really needed to reduce lines, transfer titles, etc., in southern Nevada instead of everything going to the Carson City office. Therefore a plan must be created and receive IFC approval before implementation. Ms. Tiffany noted when the business process re engineering was discussed, if completion is not done by the first year of the biennium the $84,000 would be lost. She asked if there was a way to word it openly enough so no funding would be lost. Ms. Tiffany expressed worry over the timing of the BPR. Ms. King clarified the $84,000 represented the lease-purchase on the document imager. Therefore if the BPR is delayed, the equipment would only result in a delay in leasing the imager not losing. Ms. Tiffany stated she did not want DMV to lease-purchase the document imager until after the BPR was completed. Ms. King felt that would be satisfactory. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. ******** STATE INDUSTRIAL INSURANCE SYSTEM - PAGE 2049 Mr. Stevens referred the committee to Page 19 of the handout. Adjustments were made in the budget on what is known now. The Senate or Assembly version of SIIS reform had not been taken into account. Ms. King discussed the adjustments to module M-200. These reflect adjustments to the agency's anticipated impact of group self insurance programs coming on line on July 1, 1995. The agency prepared their inital estimate of the impact prior to regulations being issued. Since regulations have been issued, the agency's estimate of impact has decreased significantly. Module E-275 was the Governor's suggested moratorium on group insurance. This module will be removed since no moratorium will occur. Module E-900 delays the transfer of the mail clerk until July, 1996. No impacts are included from S.B. 458, A.B. 601 or A.B. 552. Ms. Giunchigliani, referring to Module E-960, noted budget closure assumes elimination of the combined audits. Ms. King stated E-960 should be eliminated. Ms. Giunchigliani asked if funds were allocated to the Jean Hanna Clark Rehab Center for construction or remodeling purposes. Ms. King said there was work being done in Las Vegas to comply with the ADA guidelines. MS. GIUNCHIGLIANI MOVED TO CLOSE THE STATE INDUSTRIAL INSURANCE SYSTEM BUDGET WITH STAFF RECOMMENDATIONS, WITH THE UNDERSTANDING MODULE E-960 HAS BEEN ELIMINATED. MR. SPITLER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. MR. HETTRICK AND MS. TIFFANY WERE ABSENT FOR THE VOTE. ******** SIIS REHAB CENTER - PAGE 2057 Ms. King stated the budget was recommended to be closed at the Governor's recommendation. MS. GIUNCHIGLIANI MOVED TO CLOSE THE SIIS REHAB CENTER BUDGET ON THE GOVERNOR'S RECOMMENDATION. MR. DINI SECONDED THE MOTION. THE MOTION PASSED UNANIMOUSLY BY VOICE VOTE. MR. HETTRICK AND MS. TIFFANY WERE ABSENT FOR THE VOTE. ******** Mr. Stevens remarked information would be compiled on the Worker's Compensation Fraud Unit, including caseload numbers, for the committee's review. The Health Division will also be asked to come in and review the Maternal Child Health budget. He also suggested having a representative from State Parks come before the committee as the Senate Finance Committee closed the State Parks budget differently than the Assembly Ways and Means Committee. Chairman Arberry suggested also hearing from the Forestry Honor Camp representatives. Ms. Giunchigliani discussed Senator Jacobsen's opposition to the Honor Camp budget and the definition of duties of those employed. She expressed opposition to the $1,000,000 additional cost. Chairman Arberry reiterated the need for the committee to discuss the issue. Ms. Giunchigliani discussed her opposition to the $3,000,000 request for the School of Medicine. Chairman Arberry explained information had been requested from the medical school and others. ASSEMBLY BILL 566 Extends period during which committee on benefits shall review history of claims paid from state's group insurance for certain public officers and employees. MS. GIUNCHIGLIANI MOVED DO PASS ON A.B. 566. MRS. EVANS SECONDED THE MOTION. Ms. Giunchigliani noted there was no cost impact. This is to continue what was begun last year. THE MOTION CARRIED UNANIMOUSLY BY VOICE VOTE. MR. SPITLER, MR. HETTRICK AND MS. TIFFANY WERE ABSENT FOR THE VOTE. ******** ASSEMBLY BILL 200 Revises provisions governing organization of department of information services and administration of state communications system. Ms. Tiffany discussed Section 2, Lines 4-8. A subsection is being removed from the old NRS statute and being replaced with Section 2. This is being done because of reorganization. No more power or authority is being given. MR. DINI MOVED DO PASS ON A.B. 200. MS. GIUNCHIGLIANI SECONDED THE MOTION. Mr. Hettrick asked about a proposed amendment. Ms. Tiffany did not have the necessary information. Chairman Arberry stated the bill could be held until the next day. Mr. Spitler disclosed he would abstain from the vote because he is employed in the telecommunications field. No further action was taken. ******** ASSEMBLY BILL 373 Proposes to exempt from taxes on retail sales orthotic appliances and ambulatory casts, other supports and casts if prescribed or applied by licensed physician, and splints, bandages, pads, compresses and dressings prescribed, furnished or sold under certain circumstances. Mr. Marvel discussed how every session more exemptions from sales tax are requested. Eventually a new tax would have to be established. Philosophically, he was against the bill. He felt there was merit to the exemption in question. However, Mr. Marvel announced he would vote against the bill. Ms. Giunchigliani agreed with Mr. Marvel and discussed examination of tax policy. She described it as "feel good" legislation. Ms. Tiffany expressed her support for the bill and stated the fiscal note was inaccurate. She noted the bill referred to "licensed provider of health care" and the tax was regressionary. Mr. Close disclosed he was a provider of these services and would not participate in discussion or voting on the issue. Mr. Allard stated testimony indicated the devices in question should have been exempt all along. The definition of medicine on Page 2 of the bill stated "means or any substance or preparation intended for use by external or internal application to the human body". He asked for staff comment. Mr. Stevens did not know. Mr. Hettrick said testimony also indicated if the devices were issued in one place, they were not taxed. If issued in another, they were taxed. He felt this was inappropriate. He recommended taxing in all situations or none. He expressed support for the bill. Mr. Price responded to Ms. Giunchigliani's observations. He noted laws need to be re examined periodically and unfairness existed in the issue in question. Mrs. Chowning requested clarification on Page 4, Line 33. She asked if exemptions were being granted for braces or supports and if supports meant crutches or things other than prescribed by the licensed health care provider. She asked if the exemption was being granted for items which are prescribed by the licensed health care provider or those which are not. Mr. Hettrick said his understanding was whether or not the items would be exempted from sales tax and not whether the fees would be exempted. Ms. Giunchigliani noted the fiscal note was adjusted to $290,000. She discussed policy issues in response to Mr. Price's comments. MR. ALLARD MOVED DO PASS ON A.B. 373. MR. PRICE SECONDED THE MOTION. THE MOTION PASSED. MR. CLOSE ABSTAINED. MR. FETTIC, MR. ARBERRY, MR. MARVEL, AND MS. GIUNCHIGLIANI VOTED NO. MRS. EVANS WAS ABSENT FOR THE VOTE. ******** A vote was taken on A.B. 692, discussed earlier in the meeting. MR. MARVEL MOVED DO PASS ON A.B. 692. MR. HETTRICK SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. MRS. EVANS WAS ABSENT FOR THE VOTE. ******** Chairman Arberry announced the meeting the next day would begin at 7:30 a.m. There being no further business to come before the committee, the meeting was adjourned at 10:50 a.m. RESPECTFULLY SUBMITTED, ____________________________ Barbara Prudic Committee Secretary Assembly Committee on Ways and Means June 12, 1995 Page