MINUTES OF THE SENATE COMMITTEE ON COMMERCE AND LABOR Sixty-eighth Session June 20, 1995 The Senate Committee on Commerce and Labor was called to order by Chairman Randolph J. Townsend, at 8:00 a.m., on Tuesday, June 20, 1995, in Room 227 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Senator Randolph J. Townsend, Chairman Senator Ann O'Connell, Vice Chairman Senator Sue Lowden Senator Kathy M. Augustine Senator Raymond C. Shaffer Senator John B. (Jack) Regan Senator Joseph M. Neal, Jr. GUEST LEGISLATORS PRESENT: Barbara E. Buckley, Clark County Assembly District 8 STAFF MEMBERS PRESENT: Scott Young, Senior Research Analyst Molly Dondero, Committee Secretary OTHERS PRESENT: Rita Hambleton, Lobbyist, American Association of Retired Persons (AARP) Joseph C. Guild III, Lobbyist, Nevada Mobile Home Park Owners Association Jeannie Deeg, President, Nevada Manufactured Home Owners Association Renee Diamond, Administrator, Manufactured Housing Division Sharen Weaver, Supervisor, Life and Health, Division of Insurance Robert F. Martin, Lobbyist, Nevada Association of Homeopathic Physicians Janice C. Pine, Director, Government Relations, Saint Mary's Health Network Robert B. Feldman, President, Nevada General Insurance Company William P. Cashill, Lobbyist, Nevada Trial Lawyers Association Bill Bradley, Lobbyist, Nevada Trail Lawyers Association Jack Vergiels, Lobbyist, Auto Insurance of America John F. Wiles, Advocate, Office of the Advocate for Insurance Customers, State of Nevada Barbara E. Buckley, Clark County Assembly District 8, presented Assembly Bill (A.B.) 484. She pointed out how lease agreements for mobile home parks sometimes carry unjustified exclusions, provisions and statements which cause the home park resident to give up constitutional rights in order to rent a space in the park, and discussed each subsection containing new language. She stated the bill has the general support of the mobile home park owners, except for section 5, subsection 8. She stated the bill outlines basic rights and protects those rights and it addresses the problem of what happens when a mobile home park closes. ASSEMBLY BILL 484: Makes various changes relating to mobile home parks. Rita Hambleton, Lobbyist, American Association of Retired Persons (AARP), expressed her support for the bill. Joseph C. Guild III, Lobbyist, Nevada Mobile Home Park Owners Association, explained why he is disagreement with portions of the bill. He explained section 5, subsection 8 is a standard clause in leases. He stated an ordinance referring to setback establishes minimum standards in a county. He stated there are mobile home parks with architectural standards which are more stringent than the standards set forth in setback ordinances. He said it would make it very difficult for a park to set higher standards than the minimum county standards for a park with such a regulation in statute. He stated in areas where rent control is allowed, such a regulation would prevent a tenant from entering into a contract with a lower lease cost than what is established by rent control. He commented there is no rent control in Nevada, but that is not to say that some day there may be. He stated the association has compromised with the other provisions of the bill and is not in opposition to the bill, except for subsection 8 as discussed. Jeannie Deeg, President, Nevada Manufactured Home Owners Association, stated section 5, subsection 8 is only a guideline and may be changed at any time. She supported the bill including section 5. The hearing was closed on A.B. 484 and a work session was opened on Senate Bill (S.B.) 361. SENATE BILL 361: Makes various changes relating to mobile home parks. Senator Townsend conducted a review of Exhibit C which is Amendment No. 906 proposed for S.B. 361. He asked for an explanation of section 16, subsection 4. Mr. Guild explained there have been incidents where a person paid rent with cash and was not given change. The change was applied to the next months rent. Senator Townsend pointed out this is very specific language and asked why this needs to be in statute. Ms. Deeg stated it often occurs that the person paying rent is not given change and that change can mean a great deal to the renter. She explained many elderly residents of these parks do not have any extra money to apply to the next month's rent. She pointed out that night banking has made it unnecessary for park managers to keep money overnight in their offices. Senator Townsend asked why the renter cannot pay with the right change. Ms. Deeg stated they should, but many do not think of that at the time they cash their social security checks. She pointed out that other businesses gives change and do not wait until the next time a person visits the store to give the correct change. Senator Regan asked why sections 3-8 were deleted from the bill. Renee Diamond, Administrator, Manufactured Housing Division, discussed the bill. She stated since park managers are registered with the division these sections contained redundant language. She pointed out that changing all the "mays" to "shalls" in those sections will add a large fiscal note to her division. Senator Regan stated not only are the "mays" removed, all authority for her division is removed along with the language. He pointed out the language needs to be left in statute. Ms. Diamond stated the division has authority in other sections. She stated it is better to allow the division discretion to act rather than mandating it to act. Senator Augustine commented page 3 of Exhibit C, relating to section 16, subsections (a) and (b). She asked how the tenants will vote. Mr. Guild stated he is opposed to Exhibit C. He does not think this much power needs to be in the tenants' hands. The improvements in a park should be up to the owner of the park. Ms. Deeg explained, "Capital improvements are anything they decide to do at any time. I think that the people living in that park, and living with whatever conditions are there should have a voice in what they are being asked to pay for." Mr. Guild clarified that a "capital improvement" is defined in Exhibit C, page 2, paragraph 1. Senator Lowden commented it is important to define what the "majority" is and how they will be notified of a meeting so that they may vote. Ms. Deeg stated there is an explanation in S.B. 361 of how the notice will be given of a meeting. She stated there are 60 days to respond to the request for a meeting. If they do not respond, then it is assumed they are in agreement. She stated it is up to the residents to fight for what they want. Mr. Guild stated: As to a rule and regulation, it is true, that if a majority of the tenants or a tenant does not come to a landlord about the rule and regulation during the 60-day notice period, the rule and regulation goes into effect, anyway. And there is not majority vote allowed to approve a rule and regulation. The purpose of that amendment was to avoid the veto power provision in the original bill the tenants had over a proposed rule and regulation. As to a capital improvement, the way the amendment reads on page 3, [Exhibit C] there is veto power given to the tenants to approve the expenditure of a capital improvement. He expressed his disagreement with the bill. He explained condominium regulations cannot be the same as mobile home park regulations, because the people do not own the real estate in a mobile home park as they do in a condominium complex. Senator Townsend instructed the people concerned with this bill to discuss their disagreements with the bill and to return at a later date. The work session was closed on S.B. 361 and opened on S.B. 196. SENATE Bill 196: Prohibits certain insurance coverages from excluding coverage for certain treatment provided by homeopathic physicians. Discussion was held on Exhibit D. Sharen Weaver, Supervisor, Life and Health, Division of Insurance, discussed the amendment. She stated the language should be deleted from section 1, subsection 3 after "629.031 . . . to (a)." She stated page 3, subsection (a) needs language referring to Nevada Revised Statutes (NRS) chapter 689B and chapter 695B of NRS. Robert F. Martin, Lobbyist, Nevada Association of Homeopathic Physicians, stated subsection 3 (b) is beyond regulations currently stated in the chapters of NRS. Janice C. Pine, Director, Government Relations, Saint Mary's Health Network, questioned the language in subsection 3, paragraph (a). She commented subsection 4 does not say that the above, referring to subsection 3, does not apply. She stated there is a problem with the language of the two subsections. The work session was closed on S.B. 196 and was opened on S.B. 555. SENATE BILL 555: Requires independent medical examinations under certain circumstances for insureds and claimants under policies of motor vehicle insurance. Robert B. Feldman, President, Nevada General Insurance Company, discussed Exhibit E. He stated in section 1, subsection 1, he would like to delete the word "expenses" on the second line, and add "damages." William P. Cashill, Lobbyist, Nevada Trial Lawyers Association (NTLA), agreed with the change. Mr. Feldman asked to change "an" at the end of the third line of subsection 1 to "one." He asked for a change on page 2, line 2 of Exhibit E. He asked the line read, "and the attorney has sent a letter of representation to the insurer." He stated he reached an agreement with the NTLA to change subsection 2, paragraph (a) to read, "The examination must be conducted in Nevada; . . . " Mr. Cashill stated the rules listed in Exhibit E will govern the conduct of an independent medical examination (IME) conducted in Nevada. Senator Lowden asked if the language "conducted in Nevada" interferes with an agreed upon specialist in California conducting an IME. She asked if the doctor has to come to Nevada. Bill Bradley, Lobbyist, Nevada Trail Lawyers Association, agreed with Senator Lowden's point and suggested adding the language to "unless otherwise agreed by all parties" to the aforementioned amendment. Mr. Feldman continued with his discussion of Exhibit E. He asked to change language in subsection 3, paragraph (c) to read ". . . for attendance at the independent medical examination," deleting "as a result of." He asked to include language into section 3, subsection 4, that a letter shall be sent which will include the reason for the examination. Mr. Cashill stated claimants must be advised of their right to bring their own doctor to an IME. He suggested that language be place at the top of page 2 of Exhibit E following the description of the "facts and circumstance" of the examination. Mr. Feldman stated he would like to delete on line 4, page 5, "and may, at the request of an insurer," and add the language "a provider of health care, in order to be approved to conduct an independent medical examination under this section, must submit his qualifications as prescribed by sections 2 (a), 2 (b) and 2 (c) to a discovery commissioner. All the discovery commissioners must maintain a list of providers of health care approved to perform independent medical examinations under this section." He explained the requested language will speed up the entire process. Mr. Feldman pointed out the bill drafter placed language into the bill which states the bill takes effect on policies issued or renewed after October 1. He stated the language should be "with accidents that occur after October 1." Jack Vergiels, Lobbyist, Auto Insurance of America, referred to language which requires a reduction in insurance rates for everyone who has taken a driver training course. John F. Wiles, Advocate, Office of the Advocate for Insurance Customers, State of Nevada, encouraged passage of S.B. 555. He commented this will be his last appearance before this committee and thanked the members for their work on behalf of the insurance customers of Nevada. Exhibit F and Exhibit G were submitted for the record without testimony. There being no further business the hearing was adjourned at 9:40 a.m. RESPECTFULLY SUBMITTED: Molly Dondero, Committee Secretary APPROVED BY: Senator Randolph J. Townsend, Chairman DATE: Senate Committee on Commerce and Labor June 20, 1995 Page