MINUTES OF THE JOINT MEETING OF SENATE COMMITTEE ON FINANCE AND ASSEMBLY COMMITTEE ON WAYS AND MEANS Sixty-eighth Session February 7, 1995 The joint meeting of the Senate Committee on Finance and the Assembly Committee on Ways and Means was called to order by Chairman William J. Raggio, at 8:00 a.m., on Tuesday, February 7, 1995, in Room 119 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. SENATE COMMITTEE MEMBERS PRESENT: Senator William J. Raggio, Chairman Senator Raymond D. Rawson, Vice Chairman Senator Lawrence E. Jacobsen Senator Bob Coffin Senator William R. O'Donnell Senator Dean A. Rhoads Senator Bernice Mathews ASSEMBLY 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: Dan Miles, Fiscal Analyst Bob Guernsey, Principal Deputy Fiscal Analyst Steve Abba, Program Analyst Dee Crawford, Committee Secretary OTHERS PRESENT: Carlos Brandenburg, Ph.D., Acting Administrator, Mental Hygiene and Mental Retardation Division, Department of Human Resources Dave Luke, Ph.D., Associate Administrator, Northern Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources Stanlee Dodd, Clinic Director, Southern Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources Jack Middleton, Program Manager, Rural Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources Brian Lahren, Ph.D., Executive Director, Washoe Association for Retarded Citizens, Reno, Nevada Edward R. Guthrie, Executive Director, Opportunity Village, Las Vegas, Nevada Jim Riggs, Budget Analyst, Budget Division, Department of Administration Dave Mercurio, Coordinator for Sheltered Workshops, Ormsby Association for Retarded Citizens Tanya Benefield, Citizen Colleen Bell, Citizen Jean Laird, Chief Administrative Services Officer, Mental Hygiene and Mental Retardation Division, Department of Human Resources David G. Miller, Management Analyst, Mental Hygiene and Mental Retardation Division, Department of Human Resources Barry Cole, M.D., Medical Director, Southern Nevada Adult Mental Health Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources Joe Lamarca, Director, Southern Nevada Adult Mental Health Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources Janet Johnson, Deputy Budget Administrator, Budget Division, Department of Administration Eugene Brown, Business Manager, Southern Nevada Adult Mental Health Services, Division of Mental Health and Mental Retardation, Department of Human Resources John P. Comeaux, Director, Department of Administration James B. Baumann, Administrative Services Officer I, Nevada Mental Health Institute, Division of Mental Health and Mental Retardation, Department of Human Resources Wilford W. Beck, Ph.D., Clinic Director, Rural Clinics, Division of Mental Health and Mental Retardation, Department of Human Resources Harry A. Dudley III, Acting Director, Lake's Crossing Center for the Mentally Disordered Offender, Division of Mental Health and Mental Retardation, Department of Human Resources Norma Brownell, President, Northern Nevada Alliance for the Mentally Ill Ann Uptergrove, Volunteer, Northern Nevada Alliance for the Mentally Ill, Carson City Chapter Bill Couey, Past President, Northern Nevada Alliance for the Mentally Ill Joe Tyler, Citizen Yvonne Sylva, M.P.A., Administrator, Health Division, Department of Human Resources Donald S. Kwalick, M.D., M.P.H., State Health Officer, Health Division, Department of Human Resources Ronald Lange, M.B.A., Deputy Administrator, Health Division, Department of Human Resources Wayne Caldwell, President, Minerals Processing and Environmental Laboratories Inc. Arthur DiSalvo, M.D., Chief, Bureau of Laboratory Services, Health Division, Department of Human Resources Sharon Ezell, M.P.A., Chief, Bureau of Licensure and Certification, Health Division, Department of Human Resources David Rowles, Director, Administrative Services, Clark County Health District David E. Rice, M.P.H., District Health Officer, Washoe County District Health Department Sandra Fairburn, R.N., Chief, Bureau of Community Health Services, Health Division, Department of Human Resources David Nelson, Manager, Immunization Program, Health Division, Department of Human Resources Jeffrey Fontaine, Supervisor, Public Health Engineering, Bureau of Health Protection Services, Health Division, Department of Human Resources Stan Marshall, Supervisor, Radiological Health Section, Health Division, Department of Human Resources Charles E. Lawson, Lobbyist, Nevada Rural Water Association Senator Raggio announced the original agenda had been revised in order to hear testimony first on Department of Human Resources budgets. He said testimony on Health Division budgets would be heard in the afternoon. Carlos Brandenburg, Ph.D., Acting Administrator, Mental Health and Mental Retardation Division, Department of Human Resources, gave an overview of the division. He reminded the two committees the division is guided by a seven-member commission appointed by the Governor. He pointed out services are offered through the four agencies comprised of the Southern Nevada Adult Mental Health Services, Northern Nevada Adult Mental Health Services (also known as the "Institute"), Rural Clinics which are situated in 10 locations serving 15 rural counties, and Lake's Crossing Center for the Mentally Disordered Offender. He noted programs for the mentally retarded are provided for individuals with significantly below average intelligence and impaired adaptive skills, some with severe medical problems. Dr. Brandenburg said the division had undergone restructuring since the budget cuts in Fiscal Year (FY) 1992 in order to achieve the most benefit from available resources. He declared the focus has been upon accessibility of services, client independence, client and staff safety, quality assurance, mentally ill in jail and mentally ill homeless. He asserted services have been improved since the division set up a mental health clinic in East Las Vegas, a satellite office in Henderson and entered into a contract with a pharmacy which allows clients to have prescriptions filled throughout the Las Vegas area. Dr. Brandenburg averred client independence improved because the division secured jobs for 154 clients, 435 clients have been provided with independent living arrangements, and case management services have been provided for 2,570 clients. He added protection has been achieved since security officers had been provided at both northern and southern campuses. Dr. Brandenburg stated a protocol had been established wherein municipal judges may refer misdemeanor offenders directly to either in-patient or out-patient programs, and centralized services have been provided for all mental health staff personnel in Reno and Las Vegas jails. Dr. Brandenburg asserted the homeless mentally ill will be helped since the division had been awarded a $4.6 million federal grant for 5 years for rent subsidies. The grant will assist 51 people this year, he said, and 152 people in subsequent years. Dr. Brandenburg indicated there are presently 930 full-time equivalent (FTE) positions in the division and the Governor is recommending 73 new positions. He said the Governor's budget recommends approximately $9.2 million in General Fund share of enhancements over the next 2 years. He asserted when that sum is coupled with an $8.5 million increase in federal funding it will allow the division to continue the initiatives begun during the present biennium and to continue to increase accessibility through the establishment of a new mental health clinic in North Las Vegas, three rural clinic offices, the addition of case-management services for 634 additional individuals, and by providing quality assurance for community programs. Dr. Brandenburg averred client independence would continue to improve through the addition of 114 new jobs, and through supportive living arrangements for 152 homeless and 146 mentally retarded people. Dr. Brandenburg described a 12-bed addition planned for Lake's Crossing Center for the Mentally Disordered Offender at a cost of $3.2 million and renovation of the two mental health facilities in Las Vegas and Sparks at a cost of $1.8 million. For major equipment items for all the agencies and to extend the computer system to the northern and rural facilities, $825,000 is earmarked he said. Senator Rawson inquired if the Advanced Information Management System (AIMS) project, which would link the north and south, is close to completion. Dr. Brandenburg replied it is included as a one-shot appropriation in the budget for approximately $500,000 and it would include the northern and rural areas. He said the southern area AIMS project has already been completed. Senator Rawson expressed a desire to know how many people are on waiting lists for each of the budgets. He asked if Dr. Brandenburg feels he could now give adequate service to both mental health and mental retardation clientele. Dr. Brandenburg opined adequate services could be given in both areas. He indicated the division is structured with Dr. Dave Luke as Associate Administrator to oversee the mental retardation programs. Senator Rawson wanted to know if Clozaril was still being used in the mental health program. Dr. Brandenburg replied in the affirmative. Senator Rawson asked if treatment is presently being provided for juvenile sexual offenders. Dr. Brandenburg responded there is no treatment program for any sexual offenders, but he voiced awareness of a bill being presented to the Legislature for such treatment which would come under the supervision of the division. Senator Raggio made a request for Dr. Brandenburg to prepare a waiting list for each of the programs. Mr. Close agreed the performance indicators could be expanded for a better understanding of the work load. Mrs. Brower asked to be supplied with an explanation of how AIMS works. Senator Raggio opened the hearing on the first item on the agenda, budget account 101-3279. The committee members received copies of a handout (Exhibit C. Original is on file in the Research Library.) on budget proposals regarding mental health and mental retardation. Southern Nevada Mental Retardation Services - Page 1063 Dave Luke, Ph.D., Associate Administrator, Northern Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources, described mental retardation and indicated there are approximately 2,000 persons so afflicted in Nevada. He said 1,236 are currently being served while 308 are on a waiting list. Dr. Luke stated there are three regional programs which provide services, the Desert Regional Center in Las Vegas, the Sierra Regional Center in Sparks, and the Rural Mental Retardation Services in Carson City and Elko. He described the services provided, including coordination of client services and the management and purchase of services. He said there are 76 beds at the Desert Regional Center and 66 beds in Sparks. Dr. Luke said the services purchased from private providers include community placement in foster homes, group homes or supported living arrangements. Job placement and family support are also provided, he said. Dr. Luke called attention to the budget overview depicted on the second page of the handout, (Exhibit C). He pointed out in addition to the three regional budgets there are budgets for the Community Training Center (CTC) which supports organizations that provide training services in 14 locations, and Home Care, sometimes called the Family Preservation budget, which provides grants to needy families who maintain a profoundly handicapped member at home. He added the Desert Regional Center manages a food account in the Las Vegas area through the budget. According to Dr. Luke, Nevada retardation services have been improving in all areas. He said federal funding has offset some of the state's costs. He affirmed case management has been provided an additional 120 persons during the present biennium. He said 20 people have been placed in the community, while 18 beds have been installed for clients with the most severe disabilities, and 56 people have gained greater independence by receiving support in their own homes. He stated more than 120 people have been assisted to obtain and continue jobs in competitive employment. Dr. Luke averred the recommended budget would address growth through better use of resources and by focusing on independence and consumer dignity. He noted most new services being recommended are for rural and southern areas which have been underserved in the past. He listed five areas of service being recommended in the Executive Budget. Those are case management, community residential placement, jobs, family support and quality assurance. Dr. Luke indicated growth and waiting lists would be addressed through case management for 378 people. He noted 30 percent of those costs will be covered through federal participation. He predicted most of those on the waiting list would be helped during the first year of the biennium. Dr. Luke surmised 146 individuals would be able to live in their own homes or apartments through community placement assistance. He said, "We have amended the Medicaid home- and community-based waiver to allow federal participation in nearly half of these costs .... That's Title XIX money." He indicated those funds would appear under Other Revenue Sources in each budget. In response to a query by Mr. Marvel, Dr. Luke said: Our understanding was the way they wanted to structure the budget, the federal line was...more specifically for like grants. This is a matching, on- going program ... Other Non-State [category]. Dr. Luke acknowledged there are no new requests for beds in the most intensive-care facilities. He added the waiver would allow for some cost-effective intensive community placements, with 19 of those being requested under the category at a cost of about $3,300 per month, which he said was half the cost for facility placements. He explained the individuals would be visited in their own homes or apartments by trainers or assistants who would come in to provide support. He added there generally are two to four people living in each residence. Dr. Luke claimed the division plans to support 67 people in obtaining competitive jobs. Another proposal would provide support for 141 families who are interested in keeping a disabled family member at home. He voiced intention to involve consumers and families in evaluating the quality of care in community placements. Ms. Giunchigliani asked if the ratio of one person to 45 clients in case management is comparable to the national scale. Dr. Luke replied his Nevada staff is "challenged" and that an ideal ratio is closer to one case manager to 35 clients. Questioning communication with school districts, Ms. Giunchigliani asked if the division is contacted when students are leaving the school's jurisdiction and in need of community placement. Dr. Luke replied, "I think most of the regions participate in the transition committees along with other, for example, voc rehab [vocational rehabilitation] and the special education departments of the local school districts." At that point, he explained, the case manager would become involved. Dr. Luke described the Quality Assurance program. He said the proposal is to provide independent contact with people living in community placements to assess how well the program is working, how adequate it is for their needs, and how satisfied they are with services being provided. He explained the program would be done through a university affiliate on a contract basis. Senator Raggio referred to a note on accreditation goals and inquired why there is a necessity for accreditation and what is being done to provide for it. Dr. Luke responded the pursuit of accreditation would be the best way to assure quality of care even though accreditation is not required for any funding source. He declared those standards have been relied upon when there have been class-action lawsuits in other states and thus meeting those standards has become a goal of the division. Senator Raggio asked if licensing is required for Guardianship Services. Dr. Luke replied: For the individuals that live in ... intermediate care, quite a number of them are unable to make their own informed decisions, so the public guardianship is provided by the Public Guardian in the various counties, and this would reimburse them for that service that is provided. Senator Raggio requested an explanation of the First Step program and the reason for the proposed transfer. Dr. Luke explained the program serves very young persons with disabilities and a proposal has been made to transfer it to the Division of Child and Family Services (DCFS) in order to provide a more cohesive program of services for children. Senator Raggio invited members of the audience to come forward if they wished to comment on the budgets. Mrs. Evans recalled there had been testimony during past legislative sessions on the First Step program in which parent groups had been insistent that the transfer not take place out of the Mental Hygiene and Mental Retardation Division (MH/MR) and into DCFS. She asked if there has been a change of opinion and if those parents would resist the transfer. Dr. Luke deferred to Stanlee Dodd, Clinic Director, Southern Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources. Mr. Dodd responded that during the past biennium the administrative portion of the First Step program had been transferred to DCFS. Mr. Dodd said, "I believe it was an oversight that the budget portion of that program remained with our agency and was not transferred to DCFS. At this point we're just transferring the budget which is 4.5 positions." He declared there are no longer any objections to the transfer from parents. There being no further testimony on southern retardation services, Senator Raggio invited the committee members to turn to budget account 101-3280. Northern Nevada Mental Retardation Services - Page 1073 Dr. Luke explained the agency consists of the Sierra Regional Center in Sparks where it serves approximately 420 persons. He called attention to the measurement indicators in the budget under Case Management. He explained the heading should read "average caseload" instead of "number of placements" because the labels were reversed on the two entries. He went over the budget line by line. Dr. Luke said the next measurement indicator, Number of Placements, includes all the beds in the region for public and private facility placements, a total of 216 residential placements. He called attention to the second line which indicates the percent of all people receiving residential assistance who live in small or community settings. Dr. Luke noted the third line shows that 56 percent of those in Community Placement who are receiving Supported Living Arrangement (SLA) aid live in their own residences. He estimated that would rise to 58 percent by the end of the year with a goal to exceed 60 percent by the end of the next biennium. Dr. Luke said the next section shows the average caseload for Day Programs, while the second line shows the number of those who are in competitive employment. He indicated the third line shows the percent of all consumers in competitive jobs. Ms. Giunchigliani asked for a definition of a competitive job. Dr. Luke replied the job would pay at least minimum wage and would be in a setting other than for those solely with disabilities. Ms. Giunchigliani wanted to know how the agency determines that housing is adequate. Dr. Luke replied case managers from the Division of Mental Health/Mental Retardation make monthly contact to investigate housing. He assured Ms. Giunchigliani the case managers have advocacy training to provide help to apartment house managers or others involved. Dr. Luke declared the intention to increase placements in jobs by 10 percent by the end of the next biennium. He noted the inclusion of federal matching funds in the adjustments to the base in the Other Non-State category. Dr. Luke acknowledged the line showing staff training had been entered erroneously at $44,687 and it should be corrected to $11,687. He explained it was a typing error and would not affect the total. He added the one-time cost of starting a private high- cost home has been deleted from the purchase expense. Senator Rawson requested an explanation of the waiting list. Dr. Luke responded there are about 25 people waiting for case management, while there are approximately 40 awaiting community placement. He estimated the wait would be nearly a year unless there is an emergency for any individual. Dr. Luke explained M-100 was a standard inflationary item. Decision Unit M-200, he said, was the first part of the case management initiative. He stated the whole initiative would serve a total of 40 additional persons in the biennium, with the first portion, M-200, designated to serve demographic growth. The remaining portion under Decision Unit E-401 would serve 24 people waiting for case management. Dr. Luke described the next item, Decision Unit M-210, as community living placements which, along with E-410, would support 25 new placements. He called attention to page 11 of the handout (Exhibit C) and noted the third initiative on the table would support job training for 10 new individuals. Senator Raggio asked, "Why is the maintenance portion funded with General Fund and Non-State, and the Enhancement is 100 percent General Fund? Is there no other funding available for the Enhancement?" Dr. Luke replied in most cases the jobs program is not reimbursable through Medicaid. Senator Raggio asked how the program is tied to the Community Training Center (CTC) program. Dr. Luke responded in some cases the CTC provides job training, while in other cases there are other providers. Senator Raggio noted a 6 percent rate increase is utilized in some of the budgets in the first year of the biennium and a 3 1/2 percent increase is utilized in the second year of the biennium. He asked how that had been determined. Dr. Luke told him it had been based upon standard inflationary figures from the Budget Division. Mrs. Evans inquired, "Funding for the CTCs is scattered in a couple of budgets besides their own budget .... Could you pull all that together in a single document?" She averred it is somewhat difficult to follow as presented. She requested calculations on the overall growth in the budget for each year of the biennium. Dr. Luke agreed to provide the information. There being no further testimony on the Northern Nevada Mental Retardation Services budget, Senator Raggio asked the committee to turn to budget account 101-3167. Residential Placement - Page 1083 Jack Middleton, Program Manager, Rural Nevada Mental Retardation Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources, came forward to speak. Mr. Middleton reported Rural Nevada Mental Retardation Services provides services throughout the rural area of the state. Duties include case management, residential placements, day activities and job placements. He protested the major difference in the management indicators for the budget show that instead of serving 190 persons the agency is currently serving 176 with a staff that was designed to serve 157. The forecasted community placements for the balance of the year would bring the number served to the proposed 192 as shown by the indicators. Mr. Middleton explained the major change recommended in the Executive Budget "is an increase in case management staff by 1.5, conversion of a contract staff, and we currently have a waiting list of 44." He acknowledged the additional case management staff would provide for service to 224 individuals by the end of the biennium. Mr. Middleton confirmed the ratio of service is 1 to 45 throughout the division. He admitted much of the service in rural Nevada is done by telephone and it requires lots of travel, making it difficult to maintain a staffing ratio of 1 to 45. He indicated the addition of 1.5 persons would enable the division to serve those on the waiting list plus those from projected growth. Mr. Middleton explained: It also increases the clerical support by .5 [50 percent], and the conversion of a contract clerical position that now exists in Elko .25 [25 percent], a conversion of a contract case manager .5 [half-time] which now exists that we added to pick up some of the waiting list, and we're also projecting growth in the community placement program in the day training, and job placement program and also in the rates that we're paying. There hasn't been a CIP [Capital Improvements Program] increase during the past biennium and we used the 6 and 3 1/2 for our private providers. There are over 71 people placed in the community in a variety of placements. This represents about 87 percent of those people placed out-of-home and of that group 55-56 percent are in their own apartments or in supported living. Mr. Middleton indicated there were several people in the audience using supported living and employment placement provided by the agency. He recalled there were 44 people placed in jobs 2 years ago with 62 supported in the CTC budget. He stated there are presently 181 working in the competitive labor market, most of whom live in their own apartments and are able to offset their costs, as a result of jobs programs. He stated most of those would not want to return to an institution, group home or sheltered employment situation. Mr. Middleton proclaimed the aim of the program is to bring about independence to allow people to do as much for themselves as possible. As an example, he pointed out many retarded people who never talked on the telephone 2 years ago, now routinely call their case managers. He added some who now hold competitive jobs volunteered to testify before the legislature. He cited one individual who has been working at a local grocery store for five years now earns $10.20 per hour. Ms. Giunchigliani asked if the $626 average monthly cost of housing is going to be increased. Mr. Middleton indicated a request is being made to increase the figure to $745. With the increase, he said, residential providers and CTC providers would receive an increase. Responding to a query by Senator Raggio, Mr. Middleton said the budget covers expenses for 14 counties. He explained placement for Lincoln County residents is handled through the Southern Regional Center because of its proximity to Las Vegas. Senator Mathews requested the subcommittee be provided with detailed information on the 1 to 45 ratio in the rural areas since the ratio in Washoe County is 1 to 35. Mr. Middleton responded the statewide ratio is 1 to 45 although the ideal ratio would be 1 to 35. Concluding testimony on the Residential Placement budget, Senator Raggio turned to a discussion of budget account 101-3160. Community Training Center Fund - Page 1081 Mr. Middleton noted the CTC program was initiated in 1969 to provide people with mental retardation day training and Jobs Program Services. He said it was originally established to serve as an education program for children, but it has evolved into a major service provider for adults. He distributed a list of providers and the number of clients served (Exhibit D). Mr. Middleton said an average of 601 individuals received services from the CTC Fund during Fiscal Year 1994. He estimated the actual number served was around 640, and there is an $83,000 balance left in the budget. He said according to Nevada Revised Statutes (NRS) Chapter 435 those funds were divided among the existing training centers, resulting in a 3.2 percent increase in the funds they received for services provided during the fiscal year. Mr. Middleton said: The CTCs offer services in three major areas. One, which we call regular or 1 to 8 staff ratio, is $17.57 a day. Pre-work, which is a 1 to 5 staff ratio, more difficult clients, ones that need more intensive involvement, at $28.51 a day. And our intensive program which ranges anywhere from $4.50 per day to $57.03 per day. Mr. Middleton offered proof the program works by stating the number of clients now entering the job market has increased which has left the Community Training Centers with a more difficult group of clients to serve. He explained those with greater needs require expenditure of more funds. He suggested changes in the complexity and types of services will continue to require more funds as more people are placed in jobs. Mr. Middleton reported five of the Community Training Centers received $60,000 in grants from the federal government last fall to emphasize supported employment. He said the Bureau of Vocational Rehabilitation took over a number of CTC clients and paid $18 per hour for direct job coaching and put approximately 180 people to work. Mr. Middleton declared there are two initiatives in the budget to provide for a cost-of- living increase. He explained the budget accounts for about 50 percent of the resources that go into jobs and day treatment. The remaining 50 percent, he said, is found in budgets 101-3279, 3280 and 3167. He said: In addition to the three divisional budgets it's also found in the River Mountain Services Program, which is our private ICF [Intermediate Care Facility] provider in the north, and Danville Services, which is our ICF provider in the south. And the CTC budget, when you add it all up for all of these this year, is $4 million, not [$]2.6 [million], and when you add it up in the final year of the Governor's budget, it's $5.1 million, and you can see that the State of Nevada relies heavily on these programs for the variety of services that they provide. Mr. Middleton acknowledged other providers are used in some areas where the CTC is nonexistent, such as Yerington or Tonopah. He said there is one client in Tonopah who works in a grocery store and lives under a supportive living arrangement (SLA) because his parents live in Tonopah. He stated 8 percent of all funds were disbursed to non-CTC providers for jobs and other services. He explained the Step Program run by the psychology department at the University of Nevada receives most of those non- CTC funds in order to serve the most difficult clients. He stated the work program would be raised from 10 percent to 11 percent during the next biennium at a cost of approximately $500,000 to be paid to non-CTC providers. Senator Raggio asked, "Have you broken down somewhere for Fiscal 1996 and Fiscal 1997 the number of regular ... pre-work slots and intensive slots?" Mr. Middleton replied, "The mix and the match is very difficult to break down because it's always a best guess. At this point in time we're serving about 500 regulars ... around 85 pre- work and 67 intensives." Senator Raggio inquired what the recommended rates for each level of service would be in the new budget. Mr. Middleton replied: Basically we ... funded all of them at the regular rate except in the regional budgets because most of the people that live in our facilities are at the pre-work rate so they were funded at the higher rate, the ones that are in the regional budgets. The ones that are in the 19 facilities are funded at the pre-work rate and so it varies based on the particular budget .... When asked what rates are being recommended, Mr. Middleton responded, "If you take $17.57 times 1.06 you come up with about $18.60. You take that again times 1.03 and it's $19 and some odd cents." He stated the legislature capped the intensive rate at $57.03. In response to a query by Ms. Giunchigliani, Mr. Middleton declared more than half the funds in the budget came from the federal government. He explained, "The reason a lot of the slots are in the ICFs ... by letting the ICF contract directly then it becomes matchable, so it goes on the 50-50 Title XIX for all services provided." He said the Title XIX funds amount to nearly $1,100,000. Ms. Giunchigliani asked why the costs are spread through four budgets instead of one. Mr. Middleton responded approximately 90 percent of the funds go to CTC, but if they are not put into either the southern or northern regional budgets they would not be matchable as expenses under Title XIX. Brian Lahren, Ph.D., Executive Director, Washoe Association for Retarded Citizens (WARC), Reno, Nevada, extolled the Community Training Center program as "one of the best public-private partnerships that exists anywhere." He declared it serves as a model for the entire country of service delivery in a partnership of private and state resources. He commended Mr. Middleton for his achievements. Dr. Lahren said WARC serves approximately 100 mentally retarded adults in the Reno area. He voiced interest in reaffirming the partnership between the state and private, nonprofit organizations. He stated private organizations provide the majority of funds for the programs, and he pointed out the sums from the state have been reduced. He expressed hope there would be a subcommittee to address the problem in greater detail. He said, "We would like to make sure that during the course of this legislative session we have an opportunity to carefully review what the basis of the partnership is and how that rate structure gets developed." Dr. Lahren asserted the evolvement of one original service delivery system under one budget into several different programs and budgets has caused some confusion. He pointed out it is difficult to know who certifies clients, when their certifications expire, and who runs case management. He suggested there should be a common, unified system to provide services such as there had been in the past. Senator Raggio interjected it had been necessary to diversify in order to qualify for matching federal funds. Dr. Lahren agreed there Is a valid reason for consolidation and said he would like to pursue the matter with the subcommittee. Dr. Lahren concurred the 1 to 45 ratio is inadequate for case management because it does not allow for individualized client assessments or placements. He conceded a 1 to 35 ratio would probably be sufficient for mildly disabled individuals, but he asserted those with more severe handicaps need a richer staff ratio. Dr. Lahren acknowledged while competition is useful he expressed dismay that the CTC programs have reached their limits because the numbers of those being referred are greater than the amount of growth provided through the CTC budget. He pointed out the rate of mental retardation in the general population does not appear to be decreasing. He asserted the CTC program should be given the resources to do the job for which it was designed. Dr. Lahren reported the average cost in Colorado and Washington to make support placements after the easiest have already been given jobs is the same as the cost for institutional placement, from $4,000 to $5,000 per year per individual. In spite of the cost, he averred people thrive on job placement as their lives become more dignified and productive. Mr. Allard asked how many of his clients actually become self sufficient. Dr. Lahren answered his WARC experience has indicated more than 50 percent return to some form of sheltered employment after initial placement. He attributed the return to a need for refinement of either social or job skills. He pointed out that many of those return from jobs that are low paying and have a high turnover even among the non- handicapped population. Mr. Allard suggested those figures should be added to the performance indicators. Dr. Lahren agreed a comprehensive data management system to track those placements has been slow in development. He expressed hope the AIMS system would help. Edward R. Guthrie, Executive Director, Opportunity Village, Las Vegas, Nevada, spoke from written testimony (Exhibit E). He remarked it is difficult to determine how many are awaiting treatment because, under Nevada law, they must be served. He acknowledged many are not put onto waiting lists as a result of the mandate. Mr. Guthrie remarked the division request in the CTC budget is for a 6 percent increase whereas the Governor's recommendation is for a 2.9 percent increase. He requested elaboration. Bob Guernsey, Principal Deputy Fiscal Analyst, Fiscal Division, Legislative Counsel Bureau, responded Mr. Guthrie was making reference to the overall budget. Mr. Guernsey said the rate increases built into the Executive Budget are for 6 percent and 3.5 percent in each year of the biennium. He explained the Budget Division took into account the extra $83,000 available at the end of Fiscal Year 1994 that was distributed back to the CTCs, and which was then removed from the base. He said although the budget does not appear to reflect rates of 6 percent and 3 percent, the rates of increase actually are 6 percent and 3 percent. Mr. Guthrie continued: We have a question on the reversion as to whether or not that's accurate. If there is a waiting list, why are we reducing the base? We know that there's a waiting list because we know we have a certain number of people that were asking us for services and yet, because of the lack of case management services at the time we were not able to provide those services .... Dr. Lahren interjected one reason there was $83,000 left at the end of the year is because the CTC program froze enrollments during the year under the impression they were over budget. He protested that may have been due to lack of adequate case management resources to track the need for services. Jim Riggs, Budget Analyst, Budget Division, Department of Administration, reiterated the $83,000 left at the end of the year has been removed from the adjusted base. He said, "However, to make up for the increase for the providers we did, in one of the enhancement units, provide an inflation-type increase." He indicated that could be found under Enhancement 401. Ms. Giunchigliani requested the figures for actual costs be provided to the subcommittee. She asked that the subcommittee also receive an explanation of the interaction with the Bureau of Vocational Rehabilitation and whether there is any duplication of services. Dr. Lehren responded, "The Bureau of Vocational Rehabilitation is doing a very good job of working cooperatively with the Division of Mental Hygiene and Mental Retardation, and that part of the system, I think, is working fine." Mr. Guthrie pointed out services are being provided for 697 people by the Southern Nevada Adult Mental Health Services, of which 448, approximately 65 percent, are receiving jobs and day training. He noted the budget provides for 259 new case management slots by the end of 1997, while he only could see 58 new slots for jobs in day training. He suggested a 65 percent ratio should provide 166 new slots for southern Nevada. He claimed the waiting list issue should include not only case management services but also services for jobs and day training at a rate of 65 percent. Mr. Guthrie declared Opportunity Village contributed $465,000 to the work center in the year ending in June 1994. He explained they were able to do that because they had $1.5 million worth of contracts with Nellis Air Force Base, $1 million worth of sales from the thrift store operation, and over $650,00 from fund-raising. He said those were all accomplished in order to maintain a work center. Even with that public- private cooperation, he complained, with the rate deterioration there is not enough money to provide relief staff when people are out due to illness or injury. Mr. Guthrie reminded the committee that many of those left to be served are often more difficult, more aggressive or assaultive. He explained that results in more people being absent due to injury claims, and it raises the State Industrial Insurance System (SIIS) rate. He stated between June 1993 and June 1994 the costs for payroll taxes increased by $105,000 and there was no rate increase during that period. He said the staff payroll was decreased by $73,000 during the same period. Mr. Guthrie claimed, "Out of our total budget of almost $5 million a little more than $1 million of it is state and federal funding." Dr. Lehren stated approximately 26 percent of the $3.5 million WARC budget came from state and federal funding. Mr. Guthrie appealed to the state to make a larger investment. Although there appeared to be a surplus in the last biennium, Mr. Guthrie declared, several of the providers had serious cash-flow difficulties. He stated, "We are on a fee-for-service system, which means you pay us after we provide the service." He pointed out he must pay staff and fixed costs such as rent before he receives cash from the state, causing cash-flow difficulties. He proposed the current surplus be used to establish a revolving loan fund to be loaned to the CTCs and free them from the necessity of obtaining loans from local banks. He declared many banks are reluctant to loan to private not-for-profit agencies that are on a fee-for-service basis. Dave Mercurio, Coordinator for Sheltered Workshops, Ormsby Association for Retarded Citizens (OARC), concurred that a sheltered workshop in conjunction with job development works well. He also agreed more help from the state is necessary. Mr. Mercurio introduced two beneficiaries of the job program, Tanya Benefield, and Colleen Bell. Mrs. Benefield told the committee she has received support when she needed help. She said, "They helped me find jobs and if it wasn't for them, for the program, I don't know what I would have done .... They paid me, too." She said she had been with the program for 4 years. Miss Bell related her experience, saying, "They also helped me. They also got me a job and I'm also in the program. They helped me a lot to pay bills, and they support me a lot. Without them I wouldn't be here right now." She indicated she has been with the program for 1 or 2 years. She said she has been able to get a job at WalMart as a stock clerk. Mrs. Benefield said she also works at WalMart stocking shelves at night. Mr. Mercurio added that most of his clients are placed at the entry level of $5 per hour, and Mrs. Benefield and Miss Bell are each earning $5.75 per hour after 10 months of employment. He indicated OARC has 15 clients employed at the present time who had come from a workshop that served 49. He admitted those clients with lower functioning capabilities are difficult to place, but he indicated most of those with greater abilities are placed in jobs in the community. Ms. Giunchigliani asked Mrs. Benefield and Miss Bell if they had gone through the sheltered workshop program first, which they confirmed. Mr. Mercurio verified Ms. Giunchigliani 's query that transportation is provided for those placed in jobs. Mr. Allard asked if employer participation provides much of an obstacle. Mr. Mercurio conceded that it does. Mr. Allard noted there are a number of bill draft requests being prepared to give employers incentives to hire at-risk students and adults, which Mr. Mercurio agreed should be helpful. In the absence of further testimony on the CTC Fund, Senator Raggio requested the committee turn to budget account 101-3168. Mental Hygiene - Mental Retardation - Page 1013 Jean Laird, Chief Administrative Services Officer, Mental Hygiene and Mental Retardation Division, Department of Human Resources, distributed a handout delineating matching grants (Exhibit F). She stated the source of most MH/MR funding is the General Fund and one federal grant. She said the budget of approximately $1 million per year supports 15 positions plus the Commission on Mental Health and Mental Retardation which is appointed by the Governor. Ms. Laird commented there are two decision units related to the commission, M-200 and E-125. She explained M-200 provides sufficient funding for all seven commission members to attend all six mandated meetings. She contended that while not all members attend all meetings, there should be funds available to cover the regular rate of $80 per day plus travel expenses. She added E-125 provides additional funds to allow commission members to attend 12 meetings at the same rate. When asked if there is good attendance at the meetings, Ms. Laird admitted only about half of the available funds were spent last year. Ms. Laird elaborated on the listed enhancements that would provide for additional office expenses. She voiced a need for an increase in travel expenses in anticipation of more people traveling once vacancies are filled on the commission. Ms. Laird said E-325 would fund the ongoing costs of the AIMS system. She indicated an error on page 1016 of the Executive Budget in which the figure $73,146 in the first year of the biennium is a duplication and should be deleted from the decision unit for that year. She explained the $73,146 in the second year of the biennium should be retained because it is an ongoing cost that would continue in future years. Ms. Laird added that the one-shot expense for the unit amounted to approximately $450,000, comprised of $180,000 for hardware, $150,000 for software, $50,000 for training and conversion costs, and $70,000 for operational costs in the first year of the biennium. She testified the system would provide client tracking, appointment scheduling, billing, accounts receivable, pharmacy system and client trust fund accounting for all case management, medication clinics, vocational services, in- patients, and community residential programs. Ms. Laird explained E-900 would transfer the AIMS position from the MH/MR budget to the Southern Nevada Adult Mental Health Services budget because the position is physically located there. Ms. Laird summarized, "This budget is ... a keep even budget. The two substantial changes are the AIMS billings and client tracking computer system, and the increases in the commission." Senator O'Donnell inquired if the MH/MR budget had gone through the Department of Information Services. Ms. Laird affirmed his query. David G. Miller, Management Analyst, Mental Hygiene and Mental Retardation Division, Department of Human Resources, interjected: The initial study for the system was done in 1987 by the Department of Data Processing, and we've coordinated with them all along. Last biennium there was a planning process, and MH/MR took part in that, and there was a budget request then. This time we've gone through the stair process, which is for the business process reengineering of DHR [Department of Human Resources] and it fits in with that. Senator O'Donnell stated that many federal and state agencies are disposing of the type of computer required for the AIMS program. He suggested the agency should investigate the possibility of purchasing one of those. Mr. Miller responded his division is working through the Department of Information Services to evaluate the computer being requested and they would consider the suggestion. Testimony on the MH/MR budget concluded, and Senator Raggio opened the discussion on budget account 101-3161. Southern Nevada Adult Mental Health Services - Page 1023 Barry Cole, M.D., Medical Director, Southern Nevada Adult Mental Health Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources, testified the service works with a $13.6 million base budget that supports 220 positions. Dr. Cole related in the past year the budget provided 60 in-patient beds, 10 crisis-unit- observation beds, and case management for 245 individuals at the beginning of the fiscal year has grown to 525 current patients. He said housing is provided for 265 patients and the medication clinic serves 2,300 patients. He noted there also is a 15- bed on-campus group care facility that assists the most chronically-institutionalized patients to integrate back into the community after they have been under years of hospitalization. Addressing the budget, Dr. Cole pointed out there are three maintenance items and 19 enhancements. He listed the major initiatives which include expanding medication clinic services, expanding out-patient counseling, a new office in North Las Vegas, a specialized program for homeless mentally ill, an intensive case management program for mentally ill who are involved with the criminal justice system, and a rehabilitation program to assist the mentally ill toward meaningful employment. Dr. Cole pointed out a recommendation in M-201 for an increase for one-half of a psychiatrist position, and increases in E-277 which would include one and one-half psychiatrist positions, four psychiatric nurses, and one and one-half medical office assistant positions. He declared those would help meet the 1996 caseload which is projected to serve about 2,500 clients at four clinical sites. Dr. Cole advised there is a recommendation in M-202 for off-campus outpatient counseling for the moderately impaired who require more than just medication. He said the service would be provided to those who have no source of income or insurance. He indicated the focus of their therapy would be problem-oriented and of short duration. Dr. Cole stated counseling staff would be added under E-278 to be distributed among all four counseling sites. He claimed M-203 would resolve a technical adjustment for the housing program funded in base year 1994 and approved by the Interim Finance Committee (IFC), but not originally included because of delays in acceptance of a United States Housing and Urban Development (HUD) grant. Dr. Cole indicated E-125 represents the salary for a site manager and a .25 secretarial support position at the North Las Vegas office. He said the remainder of the funding for the new site is included in other decision packages. He explained the new site is necessary because a substantial number of clients live in that area. Dr. Cole described E-126 as a recommendation for intensive case management for the severely mentally ill referred from the criminal justice system and from area homeless shelters. He declared the program would target those who traditionally reject out- patient services but who continually get into trouble. He said the program would have a 24-hour per day response capability and would provide daily follow-up services for an extended period of time. Mr. Spitler asked for details regarding occupational studies and fringe benefit adjustments addressed under M-300. Mr. Riggs came forward to respond: On the M-300, the reason the number is so high is that the agency has more than 75 positions, consisting of the mental health techs [technicians], social workers, and so on, that were previously frozen ... that are now unfrozen. Mr. Riggs estimated it would provide more than 75 positions. He agreed to furnish backup information on how the number was determined. Senator Rawson wanted to know how much the facility program cost and whether there would be a change in services. Senator Raggio concurred, saying: I think there needs to be a full explanation to this committee because this came about after the session, and there are new people on this committee as well as some of us who have only recently heard about the Family Practice Residency program, known as Mojave. How is that funded, what kind of review is there, what kind of monitoring, how does this tie to the state's program? Mr. Marvel asked why the Mojave program did not appear under the Southern Nevada Adult Mental Health Services (SNAMHS) budget. Joe Lamarca, Director, Southern Nevada Adult Mental Health Services, Mental Hygiene and Mental Retardation Division, Department of Human Resources, responded that Mojave funding is provided directly through Medicaid. Mr. Marvel asked who supervises the funds and whether it goes through MH/MR. Senator Raggio repeated his request for a full report on the Family Practice Residency program, including how it came about, what it supplants, what control there is over funding, an estimate of quality of care and the limit of care. Senator O'Donnell referred to actual personnel expenses in 1994-1995 of $9,422,000 on Executive Budget page 1024 and asked if the agency had reduced its request to $7.9 million because of the 75 frozen positions. He wondered if there is a correlation with the maintenance figure of $1.3 million on Executive Budget page 1026. Mr. Lamarca concurred by suggesting to add the M-300 figure to the $7.9 million. Senator O'Donnell asked, "Why is that not in the base budget? If you had positions that were there originally, and they were frozen, why not continue to have them in the base? Why do you explain that as a maintenance and fringe benefit?" Mr. Lamarca conceded he would have to get back to Senator O'Donnell later with an explanation. Referring to Mr. Spitler's query regarding the occupational studies, Senator Raggio asked if the explanation is that there was no merit increase because 75 positions were frozen. Janet Johnson, Deputy Budget Administrator, Budget Division, Department of Administration, responded she could not give a specific explanation regarding the work problem but she offered to clarify part of the confusion. She explained: The M-300, when that was done, those figures were calculated and they were reduced out of the base and added to M-300 just to isolate the cost. So they are not in the base. And the agency request was done in the same manner .... But in FY 1994 and FY 1995 those positions were frozen. Senator O'Donnell suggested $1.5 million could be "floating around." Ms. Johnson offered to look into the matter. Eugene Brown, Business Manager, Southern Nevada Adult Mental Health Services, Division of Mental Health and Mental Retardation, Department of Human Resources, explained there are 10 psychiatrist positions funded under category 1. However, he said, during the year those funds were moved into a special category, category 8, which paid the university under a contract. Senator Raggio asked, "Some of the money has not been moved down to psychiatric contracts? .... And you'll note in the work program it was much less, $600,000. Is that the difference?" Mr. Brown concurred. Senator Raggio pointed out there still needed to be some further explanation as to why the change for occupational studies is such a large amount. He inquired if that was the cost of all merit increases. John P. Comeaux, Director, Department of Administration, responded: There are a couple of other things in that M-300 category too, but it's mainly those other items that are the fringe benefit adjustments. But the majority of what is in that item is the result of unfreezing a large number of positions in that budget account for merit salary increases. That was based on our review of the actual 1994 turnover of rates at the various agencies. We used a benchmark of around 20 percent. If a particular class of position had turnover of about 20 percent or more, we froze those positions for the merit funding. If they had turnover of less than that then we funded them. Obviously there were a large number of positions in this budget that last time around were frozen. This time around we unfroze them. Ms. Giunchigliani inquired: If we break those out like that, then they're never part of the base. So what happens to roll-up in 2 years down the road .... That's part of my concern, that those are positions that we allocated that were to be funded but due to cuts you froze. By breaking them out and segregating them do we expect it in the next budget cycle as well? Mr. Comeaux responded, "When we talk about freezing them, we're not talking about the position itself, we're talking about just the funding for the merit salary increases." Ms. Giunchigliani asked if the merit salary increases would normally appear in the base budget. Mr. Comeaux replied, "The merit increases are actually provided for the positions that are eligible for them whether we specifically provide funding or not. So it does get built into the base ...." He confirmed Ms. Giunchigliani's question that the same transpires in other budgets. Ms. Giunchigliani suggested, "If something should have been in the base, I think you're going to affect a roll-over the next time around if it isn't properly contained within the base. All we're trying to do is segregate occupational studies versus what should have been in the base budget." Mr. Comeaux countered: I can just assure you, though, that the cost for those merit salary increases that are actually granted to employees when they become eligible for them, those are included in the base. We isolated, just for purposes of your review, the additional funding that would be required to actually provide the funding...dollars to the agency to pay those merits. If we didn't provide that then they would be taking it out of their hides, basically. Senator Raggio interpreted the comment to mean, "If the turnover occurs, then the money isn't required in the base budget, if the ... employees stay on, then there is a need for it." Mr. Spitler ventured, "One of the things that's misleading is this boilerplate language that you have under these, like M-300 ... because we're really talking about only personnel expenses, but under the boilerplate you don't know what part of that's going to roll into the base budget." Mr. Comeaux agreed and promised to be more specific next time. Dr. Cole continued his discussion of the new intensive care management facility being proposed for North Las Vegas near the new centralized homeless shelter. He said the office would function as a satellite of the North Las Vegas office, with the intention of being able to serve 40 patients at a ratio of 1 to 10. He indicated intensive services would be provided for approximately 6 months for people who usually wind up being incarcerated. Dr. Cole alluded to E-402 under which services would be provided for an additional 120 patients who represent 15 percent of what he called an underserved population of 790. He stated they would be served by two mental health counselors and a psychiatric nurse. Dr. Cole made a recommendation under E-175 for a half-time data technician position to use the AIMS system for support for 50 on-campus users as well as several new off-campus dial-in users. Calling attention to page 24 of Exhibit C, Dr. Cole explained E-176 is a recommendation for an accounting specialist position to augment the billing department and to increase the capacity of the agency to meet additional demands brought on by the new program. At the instruction of the director of the Department of Human Resources, Dr. Cole said, E-177 would create a division-wide medical director position to oversee medication clinics, inpatient programs and outpatient services. Dr. Cole indicated E-275 would provide funding for newer and safer psychotropic psychiatric medications commonly used in the community. It will allow 16 patients with significant diagnostic uncertainty each year to undergo neuropsychological testing. Noting it is a significant increase, Senator Rawson asked if he is correct in his understanding the medications would cost $800,000 over the biennium. Mr. Lamarca interjected the agency is attempting to lower prescription costs through contract negotiations with several vendors. He opined the contract negotiations should be concluded within a couple of weeks, at which time he would notify the committee. Senator Raggio asked if the state is able to negotiate prices as low as those available to other entities. Mr. Lamarca responded the agency belongs to a consortium of states that purchases drugs in bulk. He said one vendor offered to contract with the state in exchange for access to the rate offered to the consortium. He declared the agency is very competitive. According to Dr. Cole, E-276 would provide a quality assurance specialist position to coordinate services either provided by the state or under contract for outpatient services, including housing, case management and day training. Mr. Lamarca interjected that, although E-276 would provide only one position, everyone has responsibility for quality assurance. The position would oversee all others. Dr. Cole reviewed the other enhancement items listed on page 24 of Exhibit C. Expanding on E-326, he stated the Interim Study Commission appointed during the 1991 session of the Legislature made a recommendation for the agency to seek accreditation. He acknowledged one major difficulty in obtaining accreditation might come from the outpatient medical records' system because the accreditation commission has a distinct style for record maintenance. He indicated there would be difficulty bringing all the outpatient services up to those standards. In response to a question by Senator Raggio, Dr. Cole stated the Northern Nevada Adult Mental Health Services is accredited. He pointed out the standards for the Joint Commission on Accreditation changed in January. Staffing in both the northern and southern facilities are adequate to meet the standards, he said. Dr. Cole said Las Vegas is fully staffed with 10 full-time psychiatrists and a full-time medical director. In the north, he said, six positions are funded although only five are filled. Dr. Cole continued with his review of the items listed in the handout (Exhibit C) on pages 22, 23 and 24. He explained item E-425 would continue on-campus security services begun in 1994 as a result of a shooting in 1992. Referring to the line item on In-State Travel on page 1031 in the Executive Budget, Mr. Arberry asked why it has increased from an original agency request for $3,800 to a recommendation from the Governor for $8,000, $10,800 and $15,000 in succeeding years. Mr. Lamarca replied, "Because we are having a delayed start-up in some of the programs, we don't need the full amount for each one of the years." As to why the Governor's recommendation is so high, Mr. Lamarca admitted he did not know. Mr. Riggs interjected, "After the agency request portion was closed, we went back to the agency and had them review their original request and we let them prioritize what their expenses would be, and this was input in the Governor's recommendation phase." Senator Raggio noted the original operating expense had been considerably higher and it appeared there has been some reallocation. Mr. Riggs responded, "On the original request that the agency provided to us, there was no way that the original funding could be recommended, so we asked the agency to prioritize their request, and our recommendation is based on these priorities." Mr. Arberry asked for a list of equipment to be purchased under the agency request for $36,000, which the Governor had recommended at $25,000, and to be followed in the second year of the biennium by a one-shot appropriation of $10,000. Mr. Lamarca confirmed there is a list, and Mr. Guernsey said, although the staff has a partial list, he would obtain the full list from the agency. Dr. Cole noted E-730 would provide for painting the SNAMHS campus and for new carpeting in the administration building. He said E-900 would transfer funding from the central office to the agency budget for the Information Specialist III position currently working at SNAMHS. Concluding the discussion of SNAMHS, Senator Raggio turned to budget account 101- 3162. Nevada Mental Health Institute - Page 1039 ` Dr. Cole commented he serves as the acting director of the Nevada Mental Health Institute (NMHI). He stated the base budget for NMHI is $11.2 million to support 187 positions. In 1994, he said, the institute served an average of 38 inpatients, and case managed 513 patients of which 77 were designated severly mentally ill. A total of 796 were provided medication management, outpatient counseling service hours totaled 390, while there were an average of 162 patients in the day training program. He declared NMHI had been responsible for 120 in supported housing placements by the end of FY 1994. Dr. Cole noted NMHI anticipates serving an average in-patient census of 45, medication clinic management for 870, with 1875 service hours of outpatient counseling, and offering 162 housing placements in Fiscal Year 1995. Dr. Cole referred the committee to page 25 of the handout (Exhibit C) and called attention to seven maintenance items and 13 enhancements in the recommended budget. He said major initiatives would include additional case managers, funding for psychotropic medications, medical consultation and diagnostic services, intensive case management for criminal justice referrals, supported employment, dual diagnosis treatment beds, continued on-campus security officers, a full-time clinic director for the agency, and a community-wide quality assurance program coordinator. Looking at page 25 of Exhibit C, Dr. Cole called attention to M-200 and E-402 which would allow expansion of outpatient counseling services. The maintenance item would fund services created by growth, while the enhancement would fund a staff psychologist and 1600 added hours of contract counseling services. He opined those would be sufficient to meet all known needs and would bring the agency up to the 1992 pre-budget reduction level. Dr. Cole said M-201, E-282 and E-401 would address case management programs expected to grow to 535 by the end of the biennium. Referring to a $47,000 discrepancy in requests on Executive Budget page 1040, Mr. Arberry asked if the agency anticipates an increase in the base under line item utilities. James B. Baumann, Administrative Services Officer I, Nevada Mental Health Institute, Division of Mental Health and Mental Retardation, Department of Human Resources, explained, "The increase appears in M-100, inflation for the utility line item." Mr. Arberry asked why more was spent in the work program for FY 1994-1995. Mr. Baumann responded, "In the base year we spent $540,000 and the agency request is the same number." Senator Raggio pointed out it had been budgeted at $469,000. Mr. Baumann agreed and said, "We're going to be short this year and we will be coming in with a work program shortly to fix that. We did the same thing last year to the tune of $80,000, and we'll be back with a change to about $90,000 this year." Senator Rawson surmised there are a number of issues concerned with an effort to keep people out of inpatient facilities and involved in community treatment, and the actual figures appear to be lower than what had been projected. He noted there have been complaints due to the difficulty of admission policies. He asked if changes are anticipated in admission policies. Dr. Cole responded there have been several changes, and NMHI is tracking the number of patients coming to the facility, including those who come under involuntary circumstances and who might be suicidal. He asserted the tracking will show what percentage is evaluated and admitted and what percentage is turned away. He said: One of the things I'm asking of the physicians at this point is that they see themselves as having a primary allegiance to the division, and more importantly a primary allegiance to service to the patients ... and that they understand that the relationship with the University of Nevada is for supplemental teaching after they've met all of their service obligation .... For full-time equivalents, 40-hour week physicians, 32 hours will be actual patient care time, 4 hours will specifically be for administrative purposes to get medical records done, to attend committee meetings, to go to staff meetings, and then all that's left over is 4 hours that can be used for teaching purposes. Dr. Cole reiterated more service will be provided to patients. Senator Rawson asked if it is more expensive for the state to care for inpatients than to provide private psychiatric facilities. Dr. Cole replied: It's definitely much less expensive to be served in our system, in a sense other than the Medicare requirement, which must show the physicians separate. We have a completely bundled daily rate of around $400-$425 a day that's all inclusive, laboratories, medication, physician charges, meals, the bed. In the private sector in Las Vegas ... the day charge for the room alone approaches $1,000. Senator Rawson asked if it would be beneficial to expand the residency program throughout the system. Dr. Cole responded: The relationship with the university has proven very advantageous in terms of recruitment. Many of the people that we're now able to recruit are enthusiastic because there is ongoing teaching of medical students and residents. What we don't have in our budget is a separate item to, in effect, pay for all the residents, and what we don't want to do is take it out of our hide by reducing the number of practicing psychiatrists on the campus. If this body feels that a residency is what the state needs, I would recommend it. We will need some separate appropriations for that. Dr. Cole returned to the discussion of M-201, E-282 and E-401 set out on page 25 of Exhibit C which he compared to the SNAMHS program discussed earlier. He said the program in the north would serve 20 patients per year at the same 1 to 10 ratio, and there are plans to contract with a private provider who already has a good working relationship with the police and sheriff in northern Nevada. Dr. Cole said M-202 would fund six dual diagnosis treatment beds for patients from the northern and rural areas of the state who suffer not only mental illness but also substance abuse. Ms. Giunchigliani asked if the courts refer clients directly to NMHI. Dr. Cole explained that both the north and south have an understanding with local judges. He said only those with misdemeanor charges can be served by MH/MR. He added if there are concerns about the mental stability of patients who are not under felony charges, judges can send them in for evaluation during the preliminary arraignment. The patients are kept long enough to stabilize them and refer them to a reasonable aftercare plan. He stated the judges have agreed to use the sentencing structure to impose outpatient treatment. Ms. Giunchigliani inquired if further legislation is needed to empower the judges. Dr. Cole admitted he does not know, but explained there is an understanding with Dr. Brandenburg that records on patients referred from the courts would be tracked through the Lake's Crossing Center for the Mentally Disordered Offender. Senator Rawson expressed concern over the study of buildings at NMHI. He asked if a list had been prepared citing the needs at the structures. Dr. Cole answered architects have toured all northern Nevada MH/MR sites and have interviewed all department heads. After determination of what facilities are needed and preferred and after review of blueprints of the buildings, recommendations will be made as to what could be refurbished and what should be rebuilt, he said. Dr. Cole continued his discussion of M-203 and E-277 which would fund newer, less toxic medications and specialized diagnostic studies and medical consultations. He explained the newer medications have fewer side effects and do not pose significant risk to patients if taken in excess. Senator Rawson pointed to a supplement of $153,000 in each year of the biennium in northern Nevada versus $400,000 in southern Nevada and asked if the caseloads are that different. Dr. Cole said the medication clinics in northern Nevada serve 870 while in southern Nevada nearly 2,300 are served. Dr. Cole referred to page 26 of the handout (Exhibit C) and said M-204 would fund supported housing placements originally projected for FY 1995. With the base, he said, the item would allow 85 placements. He indicated E-175 and E-901 would provide a full-time clinic director to coordinate services for the agency, lead planning, and support the psychiatrists and medical director. Dr. Cole stated E-275 would fund a quality assurance specialist for Washoe County and the rural clinics. Turning to page 27 of Exhibit C, Dr. Cole called attention to the budget requests for E-278, E-283 and E-425. Senator Raggio inquired if any services are available to other governmental programs under E-283, such as vocational rehabilitation. Dr. Cole replied he is not aware of any other funding sources for outpatients. Dr. Cole concluded his discussion by saying E-710 would provide for leasing two 15- passenger vans. Senator Raggio asked if it is cost-effective to lease the vans. Mr. Baumann replied the agency presently owns the vans for which replacements are requested, and he voiced a preference to lease vans from the motor pool rather than to assume ownership. Ms. Giunchigliani wanted clarification regarding the supported housing. Mr. Baumann explained original funding had been provided for 64 placements in 1995 when HUD money was received to fund rent subsidies for an additional 55 placements. He said, "In order for us to provide the wraparound services we will increase the total number of SLAs to 85 without requiring additional state support." Mr. Close asked for a breakdown of the cost differences between buying or leasing a van. He suggested data regarding quality assurance could be included with performance indicators. Dr. Cole concurred. With no further comments on the NMHI budget, Senator Raggio turned to budget account 101-3648. Rural Clinics - Page 1055. Wilford W. Beck, Ph.D., Clinic Director, Rural Clinics, Division of Mental Health and Mental Retardation, Department of Human Resources, reminded the committee Mr. Baumann also serves as the business manager for Rural Clinics. Dr. Beck said the budget provides for 10 clinics in 15 rural counties, and it derives 71 percent of its funding from the state, 12 percent from federal grants, and 17 percent from client- generated revenues. Dr. Beck stated FY 1994 services were provided to 2,278 outpatient clients per month, to 24 clients per year in supported living arrangements, to an average of 48 clients per month for day training (now called psychosocial rehabilitation), to an average of 400 in case management, and to an average 625 per month for medication clients. Dr. Beck noted that Rural Clinics is the only agency that serves both adults and children. Dr. Beck said the budget for Fiscal Year 1994 was approximately $3.9 million, and the Governor is recommending $4.3 million for 1996. It would provide for 76 clinical and support staff as well as client services. Dr. Beck indicated the Rural Clinics budget begins on page 28 of the handout (Exhibit C). He described the main proposals as an increase in psychiatric hours, funding for contract allocation services, reestablishment of three satellite mental health offices, funding for job placements and job coaching, and four additional full-time equivalent case management positions. Mr. Dini asked for a rundown on waiting lists and caseloads in the rural clinics. Dr. Beck responded the average waiting list for the entire program ran between 50 and 60 over the past year. Dr. Beck said: The caseloads for each of the clinicians varies considerably. We have a standard on which outpatient services are provided .... The standard in rural clinics approximates 100 percent. That is, they're providing a minimum of 25 clinical billed hours per week per clinician. We have some clinics that are higher than that where the waiting list and pressures of demands from clients is higher .... Mr. Dini voiced his understanding the Yerington clinic is at 140 percent. Dr. Beck confirmed the figure and agreed it has one of the highest caseloads. Dr. Beck called attention to M-202. He declared medication clinic programs for the severely mentally ill are a vital component of the program, and M-202 would provide for an increase of 618 hours in FY 1996 and 611 hours in FY 1997. He said M-203 would provide for increasing outpatient counseling to an average monthly caseload of 2,375 by adding 345 hours in FY 1996 and 282 hours in FY 1997 through contract counseling. Dr. Beck stated each of the three satellite offices would be staffed by one full-time equivalency (FTE) mental health counselor and one-half FTE support position to serve 519 additional new clients by FY 1997. He attributed the requests in E-125, E-126 and E-127 to reestablishment of offices that were closed during budget reductions in 1992. He acknowledged each enhancement has operating costs and psychiatric coverage built into it. Dr. Beck said E-401 would provide mental health services for the severely mentally ill (SMI). In order to achieve a stabilizing effect with SMIs, he said, a request is being made for contract funds for specialists in job development, placement and coaching. He compared it to a similar item in the NMHI budget. He anticipated providing those services in Carson City, Douglas and Lyon Counties. He said placement would be provided for 30 clients per year, while job coaching would be provided for up to 1 year for five clients. Dr. Beck referred to E-403 and explained Rural Clinics provide case management service primarily by allocating existing clinical staff time. In FY 1994, he said, the Legislature provided two additional full time case management positions, bringing the total to 6.95 FTE positions. He said E-403 would add four FTE case managers, with two positions allocated to Yerington, Fernley and Silver Springs, and two positions added to Carson City. He stated this month the case management caseload is 424, a ratio of approximately 1 to 63, and the funding would bring the caseload close to the ideal of 1 to 35. In response to a question by Ms. Giunchigliani, Dr. Beck cited the difficulty of placing SMIs because they are severely impaired, they lack stability, they frequently drop out, and they have a rapid turnover. He said the request is unique because it asks for a contractor to move through a three-county area. Mr. Marvel inquired what the ratio is of adult to juvenile mental health cases in rural Nevada. Dr. Beck responded 24 percent is comprised of adolescents and children, a figure corresponding to the rural population. He repeated Rural Clinics is the only agency in the division that provides services to children. Dr. Beck called attention to enhancement items 128 and 129 which provide clerical and support staff in Tonopah and Carson City. He added E-176 would provide additional rent for the anticipated move to a non-state-owned facility in Carson City in a central location. Dr. Beck recalled a reference by Dr. Cole to the request for a full-time clinic director at NMHI and indicated E-901 would transfer one-half of the clinic director position back into the Rural Clinics budget, meaning himself. Referring to the transitional home care budget on page 106 of the Executive Budget, Mr. Close asked if the figure $159,000 is the actual amount. Dr. Beck confirmed the figure and explained it reflects the addition of a federal shelter grant of $104,000 in Fiscal Years 1996 and 1997. There being no further testimony on the Rural Clinics budget, Senator Raggio asked the committee to turn to the Lake's Crossing Center for the Mentally Disordered Offender budget account 101-3645. Facility for the Mental Offender - Page 1049 Harry A. Dudley III, Acting Director, Lake's Crossing Center for the Mentally Disordered Offender, Division of Mental Health and Mental Retardation, Department of Human Resources, testified the base budget for the facility is $1.9 million with a staff of 54 and 36 beds. Mr. Dudley described the Lake's Crossing Center as a maximum security residential facility which provides statewide services for individuals involved in the criminal justice system who need to be evaluated for competency to stand trial, who need evaluation of criminal responsibility, or who have been adjudicated as incompetent to stand trial and have been referred to the facility for treatment. Mr. Dudley said the current population is 43, which he asserted is way over capacity. Dr. Brandenburg interjected the southern Nevada forensic facility may not be completed until the year 2000, but if the insanity law is changed the need for forensic beds will increase and necessitate building the facility sooner. Mr. Dudley indicated the major initiative in the budget called for two psychologists to conduct outpatient jail evaluations, one new Management Assistant II position to provide services for the outpatient evaluation team, one new supervisory forensic specialist to provide supervisory coverage on the night shift, one new Program Assistant II position to provide a program evaluation system, and funds to cover attendance at the annual forensic directors' conference. He highlighted those initiative summaries in Exhibit C on page 31. Mr. Dudley attributed the request for two psychologists to the fact 72 individuals were admitted to Lake's Crossing in 1994 for competency evaluations, of which 59 were referred for felony-related offenses. He declared the Nevada Revised Statutes stipulate that individuals accused of a felony must be evaluated by two mental health professionals, while misdemeanants only need be evaluated by one mental health professional. He suggested many of those could be evaluated in the county jails, determined to be competent, and deflected from inpatient facilities. He declared that would result in reduction of the average daily census at Lake's Crossing center. Mr. Dudley added: Municipal judges in Clark and Washoe Counties have indicated that six new referrals for misdemeanor evaluations will be received beyond those currently received. The new psychologist positions will enable us to deal with the increase in court referrals and conduct these evaluations in the outpatient jail settings. Mr. Dudley said the third personnel position found under E-125 would provide for the addition of one Management Assistant II position, which would provide support services for the outpatient jail competency evaluations as well as assisting the existing support staff with transcription. He noted the facility currently has only two support staff members. Under E-175, Mr. Dudley told the committee the item for $1,045 is to enable the director to attend the annual national forensic directors' conference. He declared the conference is the only forum available for disseminating forensic clinical security issues on a national level. Mr. Dudley indicated E-325 would provide for one Supervisory Forensic Specialist because there is presently only one to provide coverage 7 days a week on the night shift. E-326, he said, would provide one Program Assistant position. He declared: Currently the facility has no dedicated program evaluation staff to develop, modify and maintain an automated data system for the collection, collation, analysis, reporting of programs for the client, aid and operational information. This position would develop reports quantifying clinical operational and information client data, jail data, staff productivity, and fiscal operations in response to requests from the Division of MH/MR, Legislative Bureau Fiscal Division. Mr. Dudley called attention to E-710 on page 1052 of the Executive Budget. He said the item for $16,745 would provide 30 heavy duty desks plus case monitoring equipment. Mr. Spitler asked, "On your utility, do you pay that directly to utility companies or do you pay some of that in fact to the Nevada Mental Health Institute?" Mr. Baumann replied the bulk is paid to the utility company, but NMHI charges for steam used for hot water and winter heating. Mr. Spitler asked why there is no line item in the NMHI budget showing such payments as Other Income. Mr. Baumann explained the payment is entered as a reduction to expense in the utility line item for NMHI rather than as a revenue. When Mr. Spitler asked if that is standard accounting procedure, Mr. Baumann replied, "It is from our prospective. When we can't control the outcome, the revenue issue does us no good. We need authority to buy the services that we need to buy." Mr. Spitler asked if the Budget Division agrees that should never be shown as a line item as a resource paid in. Mr. Baumann replied: We've done this for a number of years. There are other issues that Budget Division has identified in the past where they felt it was important to show as a revenue line item. This was not one of them. Ms. Giunchigliani inquired as to the point of origin of patients at Lake's Crossing and whether it would be wise to explore commencement of construction of the other forensic lab instead of adding another 12 beds to Lake's Crossing. Dr. Brandenburg acknowledged that has been considered. He said: For the last 7 years...it basically breaks down to about 33 percent for each of the areas. In fact, for 1993-1994, Washoe was 26 percent, Clark was 38 and rural was 36. For 1994 through 1995...through December, Washoe was 33 percent, Clark was 32 percent, rural was 35 percent. Dr. Brandenburg continued: One of the things we wanted to avoid was the duplication of administrative costs. If we built a new forensic facility in southern Nevada we would be talking, probably, a $10 million CIP request and an easy $4 million a year operating expense, where adding a 12-bed addition to Lake's Crossing we wouldn't have to duplicate the administrative costs. At this moment in time we will continue providing the services at the current rate and then wait until our average occupancy rate increased to the point that the southern Nevada forensic facility could be justified. Mr. Dudley added three computers and software are being requested as part of the $16,000 item for use on the AIMS system and the old computers would be utilized in academic services. He stated the one CIP project being recommended would provide approximately 9,000 square feet for a 12-bed wing and the remodeling of a 2,300 square foot area. Mrs. Evans remarked throughout the MH/MR budget the mission statements have failed to reflect the mission of the various agencies. She suggested the mission statements be expanded in the future. She declared the performance indicators are lacking as they primarily describe work loads rather than true evaluations and output measures. Norma Brownell, President, Northern Nevada Alliance for the Mentally Ill, stated she has a mentally ill, homeless son. She stressed the necessity for adequate treatment with emphasis on quality. She complained her son had been released from the institute much earlier than he should have been and she advocated expansion of outreach for the homeless. She declared her son's only salvation has been the Haven of Hope. Mrs. Brownell agreed that renovation of the institute would raise morale of both patients and employees. After a recent tour, she exclaimed the NMHI facilities are "depressing just to walk through." Ann Uptergrove, Volunteer, Northern Nevada Alliance for the Mentally Ill, Carson City Chapter, testified as a new resident of Carson City. She explained she has a 41-year old seriously mentally ill son who has lived on the streets in San Francisco and who has lived in board and care homes, and who now lives in South Dakota. She compared the care facility in South Dakota to a college campus with various recreational and work facilities available to patients. She said it provides total medical care and counseling. She suggested if a poor state such as South Dakota could provide such a facility and care, Nevada should be able to do the same. Mrs. Uptergrove described a complaint she had heard from a Carson City parent of a severely mentally ill individual that there is no adequate facility available in the area. Bill Couey, Past President, Northern Nevada Alliance for the Mentally Ill, emphasized the importance of bringing the computer system on-line. He related he has a 40-year old daughter who has been mentally ill since she was 15, who has been in and out of hospitals all during that period. He stated she has been on Clozarine (Clozaril) for the past 1 1/2 years with "absolutely a miraculous turnaround." He reiterated the importance of the new medications in spite of their cost. Joe Tyler, Citizen, told the committee he has had schizophrenia for the past 15 years. He said he has been hospitalized six times, but a year ago he started taking Risperidone, one of the newer medications. He asserted, "It's really turned me around. It's lifted the fog. It's not like the barbaric medications that you get night-kicking and tardive dyskinesia." Mr. Tyler concurred the newer medications will help keep patients out of the hospital with a resultant savings as well as providing a better quality of life. He stated he is looking forward to obtaining a degree from the university as a result of the new medications. There being no further testimony on the MH/MR budgets, Senator Raggio called a recess until 1:30 p.m. Senator Raggio reconvened the meeting at 1:30 p.m. and commenced hearings on budget account 101-3223 in the Health Division. Office of the State Health Officer - Page 1093 Yvonne Sylva, M.P.A., Administrator, Health Division, Department of Human Resources, handed out a number of documents. Exhibit G, entitled Healthy Nevadans, presents an overview of the division including a list of bureau chiefs. Exhibit H, A Framework for Public Health was developed by the Clark and Washoe health districts over the past biennium and includes objectives for the year 2,000. The next document, Exhibit I,shows the 1994 report on teen pregnancy. She included information about the public health laboratory (Exhibit J), information on the Clark County Health District (Exhibit K) and on the Washoe County District Health Department (Exhibit L). A report on Nevada's Safe Drinking Water Program was included as Exhibit M. (Originals of Exhibits G, H, I,J, K, L and M are on file in the Research Library.) Ms. Sylva stated the division has 18 budget accounts including 42 grants and 85 funding sources. She said the funding for Fiscal Year 1995 is over $44 million of which 25 percent is derived from General Funds, 55 percent comes from the federal government, and 20 percent comes from other sources. Ms. Sylva noted 65 percent of the funding went into four budgets; Special Children's Clinic, Maternal and Child Health, Bureau of Laboratory Services, and Immunization. She pointed out the FY 1997 General Fund request is less than the expenditures from the General Fund in FY 1993. She said the increase requested for FY 1996 is 2.1 percent over FY 1994 and the amount requested for FY 1997 is 6.4 percent over FY 1994. Ms. Sylva warned the committee there would be an impact in most budget areas if the United States Congress cuts block grants because more than 50 percent of the budget comes from the federal government. Ms. Sylva stated the Health Division has experienced considerable growth in the past 18 months, particularly in areas related to the human immunodeficiency virus (HIV), immunization and licensure of health facilities. She added the federal drinking water mandate has impacted resources. She indicated the agency budget is requesting additional support for health protection services, and the growth of federal programs is reflected in each budget area. Ms. Sylva called attention to budget account 101-3223 which provides for overall administration of the agency, including fiscal and grant management, personnel, and health planning activities. She said there are two federal grants included in the budget, and there is a one-shot appropriation request for FY 1996. She described the measurement indicators as related primarily to health planning activities. She said revenue consists of state appropriations and assessments allowed against specific federal grant programs for indirect administrative costs. Ms. Sylva explained the base budget reflects continuation of expenditures at the 1994 level with some exceptions. She listed the exceptions, including the addition of four positions provided in two federal grants. There is an adjustment in operating, she said, to reflect state grants and insurance. She explained: The tobacco grant line item reflects annualization of the grant that was initiated in Fiscal Year 1994. [In] state systems development grants, the difference reflects annualization of the grant initiated in state's fiscal 1994. The state health board meeting council funding for the SHCC [State Health Coordinating Council] has been deleted. She said Senate Bill 153 has been introduced to delete SHCC. SENATE BILL 153: Makes various changes to provisions governing planning for health care. Senator Raggio inquired why a decision has been made to eliminate SHCC. Ms. Sylva responded the funding for SHCC was eliminated in favor of using other planning bodies within the division. Senator Rawson contended a central planning body should study the entire issue of health care reform. He asked Ms. Sylva what she considers the best method of health planning. Ms. Sylva responded many bodies should be involved including the Division of Insurance along with specific agencies within the Department of Human Resources. Donald S. Kwalick, M.D., M.P.H., State Health Officer, Health Division, Department of Human Resources, expressed the opinion if health planning is going to succeed prevention and public health would have to be included. Referring to indirect cost allocations, Senator Rawson asked what rate has been negotiated with the federal government and whether it would increase next year. Ronald Lange, M.B.A., Deputy Administrator, Health Division, Department of Human Resources, answered the present rate is 11.5 percent but the rate for next year would not be known for another month. Mr. Spitler asked how costs for support from the attorney general are paid. Mr. Lane responded, "Right now we are not assessed a fee for the Attorney General Services because I think the General Fund appropriation is already in our budget. We do absorb some costs, for example, travel...on behalf of the state Board of Health and on behalf of the agency, or operating supplies, we absorb those directly in this budget." Mr. Spitler said he is of the opinion the attorney general fee is only rolled into the base if it is a 100 percent General Fund budget. He asked the Budget Division to respond. Ms. Johnson replied Mr. Spitler was correct and agreed the General Fund share should not be included in the base budget. Mr. Spitler recalled the 1989 legislature had approved a Program Assistant position because it was deemed essential to the operation of the division. Noting there is a request to transfer the Program Assistant to the Department of Information Services (DIS) he asked if any service would be provided by DIS. Ms. Sylva replied under reorganization the Governor recommended transferring the position to DIS. She said: I need to point out to the committee, although the position was transferred and the funding was transferred as well, there was no funding put back into the budget so that we could purchase services. I should also note that we receive 40 hours of service a week from the staff person at about $25 an hour including step salary and benefit package, so we would need to be able to purchase a like amount. When asked how the division would pay for that service, Ms. Sylva responded the division would not be able to pay as the budget now stands. Mr. Lange suggested it may have been an oversight because the amount was supposed to have been placed in another funding source to offset the cost. He complained, "Our major problem is we pay this individual $24, $25 an hour right now, considering fringe, you buy services from DIS and you're paying anywhere from $35 to $70 an hour .... " Mr. Spitler recalled there had been testimony in 1989 that the division could not afford to transfer that position to DIS because the rate was too high. He noted, "Now not only is it transferred to them, you have no money to pay them anything." He suggested further study. Mr. Hettrick interjected there is also a one-shot appropriation of $1.5 million for replacement of computer hardware. He asked: If you're using your individual already 40 hours a week and you're concerned about the cost of that, how are you going to set up, operate, and all the rest of the things the additional computer hardware that we're looking at in the one-shot. Mr. Lange replied the $1.5 million was for the technical equipment at the state laboratory and he agreed there would have to be some services for DIS. He indicated there was $60,000 allocated in the first year of the biennium for DIS review, and $315,000 in the second year of the biennium. Ms. Sylva referenced the request in the M-200 category which would provide a Personnel Technician Grade 27 position to handle caseload increases due to new federal initiatives such as HIV, immunization, tobacco and cancer programs. She cited a division survey of eight major agencies which indicates personnel support ratios ran from 1 to 125 up to 1 to 150. She added the Health Division ratio is 1 to 343. The M-200 request would provide a computer work station. Ms. Sylva explained Decision Unit M-201 would provide an Account Technician Grade 30 due to work load increase which she attributed to the growth of federal programs. She asserted a federal cash management program initiated in 1994 increased the work load. She said the number of federal grants had increased from seven in 1981 to 42 separate grants and three major contracts in 1994. She indicated the division business office had one full-time employee in 1981 and now has six. She stated the normal work load including payroll and insurance adjustments has increased due to the increase in division staff. Ms. Sylva said M-300 is related to merit salary increases. Decision Unit E-900 is a request for a transfer of an Administrative Services Officer to the state laboratory. She explained the incumbent has been physically stationed at the laboratory for approximately 10 years as a full-time administrative officer, and the position was reclassified and upgraded under the occupational study in FY 1993 based upon functions performed at the laboratory. Ms. Sylva stated, "Decision Unit E-901 requests the transfer of an Accountant First, position 004, currently working in the business office from budget account 3222, Maternal and Child Health." She averred the funding would be neutral in terms of state appropriation. Ms. Sylva indicated E-912 had already been addressed relating to the transfer of a systems analyst to DIS. She explained the one-shot appropriation of $45,426 would allow for automation of the business office, personnel office and administration into one network. Senator Rawson inquired about the progress of the laboratory expansion. Ms. Sylva replied it is under construction and will be completed by December 1995. Referring to receipt of a letter expressing concern the laboratory would compete against private facilities (Exhibit N), Senator Rawson asked if that has been considered. Dr. Kwalick responded it would be an issue if the state was primarily involved in personal health services. He asserted, "The things our laboratory is involved in are really specialized, low-volume ... kinds of tests, whereas the private labs get into high volumes that produce a lot of profit, etcetera." He called activity of the public health laboratory a "core public health function that benefits the entire community rather than individual patients." Vice Chairman Rawson invited public comment. Wayne Caldwell, President, Minerals Processing and Environmental Laboratories Inc., stated his company provides water testing analysis. He disputed the contention the state laboratory does not compete with private industry in conducting well testing. He pointed out in 1994 the Nevada state health laboratory derived $317,000 from water chemistry tests, $367,000 from microbiological tests, and $86,000 from water bacteria testing. He called attention to figures on two handouts (Exhibits O and P). Mr. Caldwell suggested many of the water chemistry fees were derived from the testing of domestic wells for purposes of title transfer through title insurance companies. He expressed the belief approximately $100,000 of the $1.6 million operating budget for the state laboratory could be saved if water chemistry was sent to private laboratories, especially for title transfer transactions in the sale of homes. He charged that type of analysis is not necessary for the health benefit of the general population. Mr. Caldwell declared his company is not involved in testing drinking water, rather it works in the wastewater program, called WP, conducted through the Nevada Division of Environmental Protection. He acknowledged the state laboratory is not conducting anything in the wastewater field at present. He suggested the state would soon turn to wastewater analysis for secondary contaminants in order to augment their budget. Mr. Caldwell estimated there is 16 to 18 laboratories in the certification program in Nevada, of which approximately 10 are certified by the state to analyze drinking water. Mr. Hettrick asked for a comparison of fees by the public and private sectors. Mr. Caldwell reminded him the state is subsidized by taxpayers at approximately $800,000 and charges $80 plus a $6 handling fee while the same service from the private sector would cost approximately $185. Senator Rawson asked if there has been an increase in the frequency of testing by the state laboratory. Arthur DiSalvo, M.D., Chief, Bureau of Laboratory Services, Health Division, Department of Human Resources, replied there has been no change in policies. He acknowledged the amount of testing did increase when mortgage rates went down. He said the primary mission is to meet public health needs. There being no further testimony regarding the budget for the State Health Officer, Senator Raggio proceeded to budget account 101-3190. Vital Statistics - Page 1099 Ms. Sylva continued testimony by listing the types of statistics kept by the state. She noted the office is the official custodian of birth and death records. She said, "A related function is the development of a data base to assist in the analyses of health trends and provide a core base of statistical data that is used by various state and nongovernmental entities in their applications for federal funding." Ms. Sylva declared the measurement indicators used are related to work load. The sharp increase in vital events registered over vital events projected for 1994 she attributed to catching up on agency backlog. Ms. Sylva said, "The revenues consist of General Fund appropriations, federal National Cancer Center for Health Statistics contract, and a few nominal contracts with federal agencies to reimburse the state for data provided on a per-request basis." Ms. Sylva pointed out the adjusted base is a continuation of the basic program with the exception of a one-time purchase of equipment in 1994, the addition of the 5-year federal Behavior Risk Factor Survey grant which resulted in a contract with the University of Nevada, Reno, to collect data, and the deletion of two one-time federal grants. She explained Decision Unit M-200 is a request for a 160 square foot expansion of a permanent fireproof vault in the Office of Vital Records in which legal documents are maintained according to the Nevada Revised Statutes. She asserted the expansion should provide sufficient space for growth over the next 12 years. Ms. Sylva said M-201 would provide for an additional Account Clerk position. She explained the office is presently supported by one Program Assistant to track receipts, an area deemed deficient under the legislative audit conducted during the last biennium. She declared no new account position had been added during the past 21 years. In 1973 the office processed 6,000 to 7,000 copies of records, she said, while over 25,000 records were processed during FY 1994. She said the revenue generated in FY 1994 was $711,573, whereas it amounted to approximately $15,000 in FY 1973. Mr. Spitler inquired how Nevada charges for copies of records compared to those in other states. Ms. Sylva reported a recent review had indicated the charges are similar, with some being higher and some lower. In response to a query by Mr. Arberry, Ms. Sylva described the process to be used in expanding the vault. Mr. Arberry asked if it would be cheaper to purchase new safes. Mr. Lange responded the vault is used daily and safes would be inappropriate for the type of usage. He indicated there would still be room for expansion in another 12 years, and in 50 years the Office of Vital Records might occupy one full corner of the floor of the Kinkead Building. He stated all such records are hard copies, and microfilm copies are used for backup or other activities. Ms. Sylva stated Decision Unit M-300 would make an adjustment related to merit salary increases. She explained E-710 is a request to replace four typewriters because they are all over 20-years old and several of the forms used by the agency still require typing as opposed to being computer-generated. Cancer Control Registry - Page 1103 Ms. Sylva related the Cancer Control Registry, budget account 101-3153, was initiated in 1979 and formally mandated in 1983. She declared the goal is to gather information to provide surveillance and data concerning the types and incidence of cancer in Nevada to be assessed by universities, medical organizations and specialists for research. Ms. Sylva reported the Health Division has been awarded a 3-year Center for Disease Control (CDC) grant of $250,000 per year to enhance the current program. Ms. Sylva explained the measurement indicator in the budget is based upon work load, while revenue is limited to state appropriations and projected receipts from the number of abstractions performed either by the state agency or submitted by facilities which perform their own abstractions. Ms. Sylva said the adjusted base includes the deletion of a Program Assistant position, a line item adjustment for Rocky Mountain Data System to reflect the actual cost of current services, the addition of rent, and the deletion of non-state rent in the amount of $1,076 due to closure of the Reno office. Under Decision Unit M-200, Ms. Sylva said $2,475 would be added under contractual services for the Rocky Mountain Data System which would allow an additional 1,500 abstracts to be entered at a cost of $1.65 each. She said M-300 includes merit salary adjustments. Ms. Sylva indicated E-325 reflects the continuation of a federal grant for the National Program of Cancer Registries. She explained while the program is not in operation yet, staff is being hired for it. She said the program would require a 25 percent match which would be obtained from participating private facilities. She noted federal emphasis is on mandatory participation of all health facilities. She said the enhancement would provide for three positions, one manager and two program assistant abstractors, who are presently funded, along with support for travel, operating supplies and rents. Mr. Spitler asked if any of the General Fund allocations for demographic caseload changes could be covered by the grant. Mr. Lange responded the federal grant is designed primarily for quality control and state dollars could not be supplanted by federal dollars. He explained the Rocky Mountain Data System is a contract that served several states and no fund is available to cover those costs. Mr. Arberry asked, "On budget page 1103, on your measurement indicators, it shows an actual cost for FY 1994, $5,800 ... and then it doubles for FY 1996 and FY 1997. Can you explain why that doubles?" Ms. Sylva replied that is due to the addition of the cancer registry grant and projections of increased participation. She added it also takes into account population growth. She pointed out further in the budget he would see the agency received a Breast and Cervical Cancer grant which would add to health promotional activity. She stated, "We would hope that we would actually see an increase early on by early detection." She conceded it should result in an increase in revenue, depending upon who performed the abstraction. Mr. Lange interjected he could not estimate the amount of revenue because many hospitals have not yet determined whether or not they would perform the abstractions. He said the state charged $20 per abstraction and when private entities performed the abstraction they reimbursed the state $6 for each abstraction sent in. Without historical data he claimed he could not make an estimate of revenue. He concluded an estimate of revenue might be obtained by fall. Ms. Giunchigliani wanted to know if the state is obligated to continue the program if the grant were withdrawn. Mr. Lange replied it is not. He said, "Our commitment to this committee has always been, we get a federal grant, federal position and the federal money goes away, the positions go away. We did that last September." He conceded the program would have to be reevaluated if private hospitals should back out of the program. Ms. Giunchigliani inquired if the federal grant allows 25 percent to be used for administrative costs. Mr. Lange responded under the federal grant there is only funding for three positions and travel for the first 2 years, and thereafter the grant requires emphasis should be placed upon quality control rather than abstractions. Senator Rawson asked if complete data is being received. Ms. Sylva answered information is not being received from some hospitals in northern Nevada due to the failure of a private company hired by the hospitals that is not making reports on their behalf. In response to a query by Senator Jacobsen, Dr. Kwalick explained information is only as complete as what is submitted and quality control is needed to complete the information. He estimated there are 6,500 new cases of cancer per year, while the state is only being informed of approximately 5,000 new cases annually. He explained the purpose of the grant is to enhance past performance, to increase participation and timeliness, and to commence prevention and control activities. Senator Jacobsen asked if information is obtained from death certificates, especially from rural areas. Dr. Kwalick responded death certificates are routinely checked to learn if the diagnosis was cancer and whether the person was in the registry. Ms. Tiffany asked how statistical information on health care is transferred to the state from hospitals and if it includes hard copies. Ms. Sylva replied data is received in many ways, including electronic information on births or computerized data collected from hospital records. Mr. Lange interjected some hospitals send computer tapes which the agency enters into the data base, or the registry goes into hospitals to make abstracts, or some hospitals hire a contractor to provide tapes, but, he said, there is no network. He explained information is entered into personal computers at the registry from which a tape is made to transmit to the Rocky Mountain Data System. He told the committee the computer programs were put into service in 1979. Health Facilities - Page 1107 Ms. Sylva commenced testimony on budget account 101-3216. She noted the division is under contract with the Social Security Administration for certification of health care facilities and for participation in federal Medicare and state Medicaid health care reimbursement programs. Ms. Sylva explained the agency staff are required to investigate all complaints, which are increasing, and to inspect prisons and correctional facilities semiannually. She noted approximately 500 complaints are received each year. All new facilities in the state must be inspected and reinspected prior to licensure, she said, and all medical facilities must be inspected annually. Sharon Ezell, M.P.A., Chief, Bureau of Licensure and Certification, Health Division, Department of Human Resources, explained there are three categories that must be licensed: medical facilities, facilities for dependents, and laboratories. She said medical facilities include hospitals, skilled nursing facilities, intermediate care facilities for mentally retarded, ambulatory surgical centers, home health agencies, hospices, nursing schools, community mental health centers, renal dialysis facilities, and rural medical clinics, the majority of which belong to the private sector. She also listed facilities for dependents, including residential group homes, alcohol and drug treatment facilities, and adult day care facilities. Prisons, infirmaries, and kitchens are also inspected, she said. Ms. Giunchigliani asked if group home inspections are being coordinated with the Division of Aging. Ms. Ezell confirmed a three-way agreement has been made not only with the Division of Aging but also with all adult protective services to provide inspection and to share information. Senator Rawson expressed concern regarding loss of accreditation due to the methods of inspection and reporting used in Nevada. Ms. Ezell responded that has been discussed and the budget would include positions to be used for quality assurance. She explained the survey process is mandated by the federal government and it provides training for surveyors. She assured the senator that every possible step is being taken to be consistent and fair to every facility. Senator Rawson recommended Nevada study how other states proceed. He charged other states may allow operation of facilities that would not be allowed in Nevada, yet their method of reporting fails to reflect those conditions and they stay open. Senator Raggio noted the maintenance budget would provide 11 new positions. Ms. Sylva reported there would be eight surveyors and one program assistant under M-200 in FY 1996 and two more clerical positions in FY 1997. Ms. Sylva remarked the work load and demand in Reno point to the need to open a facility there which would also reduce staff travel. Ms. Ezell said the Reno office would have a staff of four. Ms. Giunchigliani asked if two new hospitals about to come on line in Las Vegas are included in projections. Ms. Ezell confirmed they are along with one other. Ms. Giunchigliani noted there had been 500 complaints and asked for comment. Ms. Sylva responded the complaints were going to be listed by category during the next biennium. She said the complaints could come from a relative, an observer or anywhere. She indicated follow-up depended upon severity of the complaint and is done within 3 to 10 days. Mr. Close asked if the Carson City office would be closed after the Reno office opens. Ms. Sylva replied all records are maintained in the Carson City office and it would remain open. She mentioned the program is linked by a computer network. Mr. Close asked why the budget included a 35 percent increase for in-state travel. Ms. Sylva answered the travel increase is due to an increase of staff members. Regarding licenses and fees, Senator Raggio noted: The budget provides $520,000 for Fiscal [Year] 1996, $549,000 for Fiscal [Year] 1997. With the increases that you have indicated in your projections, those fees are lower than your current work program. How are your fees calculated and are you recommending increases in fees ...? How is this being funded? Ms. Ezell confirmed the fees are lower than indicated by the 1995 work program. She pointed out the fees had not been realized yet. She explained the fees had been calculated when General Fund revenue was removed during the previous legislative session and they had been based upon the actual staff costs of providing the surveys and investigations. She concluded, "We increased fees. We think that it will require very little increase in order to make it to the next biennium." Mr. Spitler questioned a reserve of $144,683 in the work program which he said he could not find carried forward. Mr. Lange responded the reserve is for the present fiscal year and it may or may not materialize. He said if the revenue did materialize it would be balanced forward because there is no General Fund in the budget, but he expressed doubt the funds would be available in 1996. He called it "soft money." Mr. Spitler commented: I've never seen soft money in these forms before. My question would be that the budget office would look at that .... I count on these reserves coming in, to some degree, because the agency is saying ... the odds are they're going to make it. Why on earth would we not let them account for it? Mr. Lange responded: In my mind I am accounting for it, because I have it in 1095. But you're right, because I know where it is, I'm not going to lose it, it's not going to disappear. It would be balanced forward. Ms. Johnson described the point of view of the Budget Division and agreed the balance forward should have been reflected and then put back into reserve. At the conclusion of testimony on the Health Facilities budget, Senator Raggio turned to a review of budget account 101-3222. Maternal Child Health Services - Page 1113 Ms. Sylva described Maternal Child Health Services as a major element of the Bureau of Family Health Services. She said the program provides help for families, pregnant women, mothers, infants, children and adolescents; development of a system of community-based family-centered services for children with special health-care needs; and planning and management for programs funded by federal grants under Title V of the Social Security Act. Ms. Sylva listed the other major elements of the program, including a children's dental program, newborn screening, and a primary care cooperative agreement. She said the Baby Your Baby program is included in the budget, a public-private partnership designed to encourage pregnant women to seek early and continuous prenatal care. She asserted there has been a significant reduction of infant mortality since the implementation of the Baby Your Baby program in 1993. Ms. Sylva stated the measurement indicators are in programs for Baby Your Baby, childrens' dental care, newborn screening and children with special health-care needs. She said 47 percent of funding comes from the General Fund, 32 percent from federal sources and the remaining 21 percent from other sources including insurance refunds, reimbursement from the Welfare Division, a birthing fee of $30 for the newborn screening program, and $26,000 from Early Periodic Screening, Diagnosis and Treatment (EPSDT). Ms. Sylva said there have been adjustments to reflect the actual state rent, the primary care category was increased to reflect annualized expenditures at the current grant level, deletion of the primary care childrens' grant and an allocation from United Way, and deletion of a genetics grant of $34,446. She noted the Maternal Child Health (MCH) data systems grant will terminate in September 1996, and Baby Your Baby has been adjusted to reflect annualized expenditures. Ms. Sylva stated M-300 would provide merit salary adjustments and E-175 would provide training for health care supervisors and professionals. Ms. Sylva indicated E-176 would implement a new statewide Perinatal Substance Abuse program and support staff for the subcommittee to the Advisory Board on Maternal and Child Health. She explained it was part of a recommendation by the Commission on Substance Abuse which advised an umbrella-type unit be established to coordinate actions of various state agencies involved with pregnant women who are addicted or who are affected by drugs or alcohol. She said E-176 would support one professional position and one clerical staff position plus normal operating and travel expenses. Ms. Sylva noted a one-time purchase of office and computer station equipment in FY 1996. She declared the agency would function as a clearing house to provide technical assistance to counties, public entities and interested individuals, and it would develop a subcommittee to the Advisory Board on Maternal and Child Health to specifically address perinatal substance abuse. Ms. Giunchigliani wanted to be provided with indicators showing the impact the Baby Your Baby program has on community hospitals. She asked why two counselors are being transferred to the University of Nevada School of Medicine. Ms. Sylva responded the community should be served better with the transfer of the counselors. She said in 1989 two genetic counselors had been transferred into the budget from MH/MR and they have always worked under the supervision of Dr. Colleen Morris who is the only geneticist in the state and who is attached to the university medical school. Dr. Morris has provided clinical supervision while Maternal Child Health Services has provided administrative supervision, which Ms. Sylva cited as the reason for the transfer. Ms. Giunchigliani stated: That is part of my concern. It's General Fund money of $104,000 and if the transfer goes to the School of Medicine and they become the ones responsible I think that should be more properly where the funding ... comes from rather than from this budget. Ms. Giunchigliani asked Ms. Sylva to elaborate on the perinatal program. Ms. Sylva offered to provide a report prepared by the Perinatal Substance Abuse subcommittee. Ms. Giunchigliani added she would like to see a mission statement, performance indicators and projections of long-term impacts. Special Children's Clinics - Page 1121 Budget 101-3208 was addressed by Ms. Sylva. She stated it is designed to provide evaluation, diagnostic and early intervention services to children with special health care needs. She noted the clinics are located in Reno and Las Vegas, they function as regional centers for screening, and they provided services to 2,702 children in FY 1994. She added the clinics are the sole providers of follow-up services for local hospital neonatal intensive care nurseries. Ms. Sylva said staff in the budget included pediatricians, social workers, psychologists, speech pathologists, audiologists, nutritionists, physical and occupational therapists. She noted the measurement indicators are listed by clinics. She called attention to the treatment intervention line on Executive Budget page 1121 and said, "Our estimation of 16,524 [interventions] was an estimation that was formed during the last legislative session and it was based upon the agency receiving all of the FTEs that they had requested. We have never revised that estimation, so it is indeed an overstatement." Ms. Sylva advised the committee, "The projected 1997 treatment intervention in the Las Vegas clinic needs to be revised to 15,708 [interventions] and in the Reno clinic both the projected in 1996 and 1997 should be revised from 8,507 [interventions] to 9,507." Ms. Sylva declared the Special Children's Clinic budget offers specialty clinics in addition to regular services. She listed those as genetic, metabolic, newborn screening, and cranial-facial clinics. Ms. Sylva noted 87 percent of the funding is derived from state appropriations with the balance from fees for service and a contract with the Department of Human Resources for $31,800 derived from the child-care block grant for speech pathology and specialty contracts. She said the adjusted base reflects level funding based upon FY 1994 actual figures with some exceptions. Those exceptions included insurance expense, state rent and non-state building rent under operating expenses. She explained the non-state building rent was adjusted to meet current contractual lease obligations. Ms. Sylva pointed out the Medical Contractors payment category was reduced by $143,325 to reflect loss of federal funds. She advised the committee the agency is in the process of developing a work program to be presented to the Interim Finance Committee (IFC). Ms. Sylva said M-200 would add 1,746 square feet to the Las Vegas clinic. She attributed the need for more space to a caseload increase of 200 in the last 3 years, client overflow spilling into the entry way from the waiting area, the need to hold specialty clinics in the hallways, a crowded clerical area, and the necessity to store specialized formula and food due to the increase in children with metabolic disorders. Ms. Sylva indicated M-201 would provide six new positions and listed those needed in Las Vegas and in Reno. She explained the Special Children's Clinic in Las Vegas had an active caseload of 736 at the beginning of 1993 and by 1995 it has grown to 928. She said the new positions would aid in diagnoses and determination of eligibility for clients, would provide medical records review on each child and would provide a comprehensive history and physical examination with a written report on each one. Ms. Sylva stated additional data entry duties have been added for clerical positions in Reno. She declared, "A legislative audit improved the insurance collection system and those improvements ... added to the duty of clerical staff involved in insurance collection." She averred billing activity would increase because Medicaid has recently agreed to reimburse for rehabilitation therapy, resulting in the need for more staff. Ms. Sylva ascribed the increased need for speech pathology to the growth in the Carson Valley making growing numbers of children eligible for services. Mr. Hettrick noted the measurement indicators did not show the caseload increases she had cited. He suggested the indicators should be more indicative of actual caseloads. Ms. Sylva concurred. She said, "We have hassled with measurement indicators in this particular budget over and over and over again. It's extremely difficult to really get to performance output or outcome measures where we can show that." Mr. Hettrick suggested a comparison of total square-footage or square-footage per person might justify the difference. Mr. Spitler questioned how reimbursements from Medicaid are reported. Ms. Sylva replied reimbursement funds are incorporated into the budget as part of the operating expenses. Mr. Spitler asked if there had been a special rehabilitation refund based upon eligibility of Medicaid clients. Ms. Sylva replied the refund had only recently been approved by the Medicaid office. She said, "We are currently in the process of going back and billing Medicaid for those services provided to eligible clients." She declared the intention to present the revision to the IFC. Mr. Spitler asked how much money that would involve. Mr. Lange responded: I'm doing a work program for $200,000 for Fiscal [Year] 1995 to go back to 1993. Of that, I'm asking for the agency to use approximately $134,000 and put the balance into reserve for reversion. Of that work program, approximately $31,854 would be taken out of this budget right here because it would be covered in the one-shot this year. Otherwise it would impact on Decision Unit E-226, E-710 and E-720. Mr. Spitler asked if the intention is to try not to revert the money and to try to put it into a work program. Mr. Lange replied: I'm going to come in with a work program, correct. I'm going to ask to be able to use part of it for some enhancements that we didn't put in this year's budget, some one-time things we need, also to replace some of the money that's in this budget and revert a portion of it to the General Fund. Mr. Spitler submitted it might not be legal to do what Mr. Lange suggested, that it might have to be reverted. Mr. Spitler stated it would still have to be incorporated into the present budget. Senator Raggio surmised Decision Unit E-225 was formerly federal funding and it is going to be replaced out of the General Fund. Ms. Sylva confirmed his assessment. Senator Raggio asked what happened to the federal funds. Ms. Sylva replied the agency had been receiving Chapter I funds from the Department of Education for the past 20 years, but the program has been eliminated during the past year. Senator Rawson asked, "Has this become another unfunded mandate? Do we still have a mandate and no funds, or is the whole program gone?" Ms. Sylva indicated she would get back to him with a response in writing. Senator Rawson noted the program was expanding and exclaimed, "It's ominous that they've taken the money away." Ms. Sylva responded 20 years ago Chapter I was probably one of the few funds directed towards children with special needs, but since that time other categories have replaced some of those responsibilities, thus reducing the need for Chapter I funds. Ms. Sylva pointed out there is a potential impact of Medicaid managed care programs in the budget. She explained that while special children's clinics for diagnostic services had been excluded, "Every effort is being made to maintain the integrity of this program to insure that children are referred for appropriate diagnoses." She said treatment services were provided through rehabilitation, and case management services were not excluded in the waiver. She explained that would require the clinics to enter into contractual arrangements with successful health maintenance organization (HMO) bidders, and then the clinics would become providers under such arrangements. Ms. Sylva acknowledged the projected revenues for Fiscal Year 1996-1997 may be overstated and require future revision due to the number of unknowns. Ms. Sylva advised the committee E-226 is a one-time request for $1,550 to provide an alarm system for Las Vegas with an estimated operating cost of $600 per year. Decision Unit E-228 would provide $3,824 per year for training to keep staff abreast of the latest treatment and diagnostic developments, she said, and E-710 would provide a new telephone system in the Reno clinic needed because the system had broken down 24 times during the past year with no successful remedies short of replacement. Community Health Services - Page 1127 Opening the discussion of budget account 101-3224, Ms. Sylva stated it provides 21 nurses and a supervisor at 15 primary locations and 55 satellite offices throughout all counties except Clark and Washoe Counties. She said, "The primary source of revenue is federal funds 44 percent, fees and county contributions 42 percent, ... state appropriation making up approximately 14 percent of the revenue." Ms. Sylva noted the adjusted base for FY 1994 actual operating expenses reflected a one-time printing expense and an insurance increase, while expenditures for equipment were eliminated. She attributed increases in M-100 to inflation, while M- 200 would provide a new Program Assistant II position with associated travel and operating costs. Ms. Sylva stated in 1994 contact was made with 122,344 patients, a 47 percent increase over 1992, statistics she acknowledged do not appear in the indicators. She explained the indicators were broken down according to service received by the individuals. Senator Raggio suggested it would be difficult to justify positions based upon caseloads if they were not projected in the indicators. Mr. Lange interjected: We had a problem with this, because we've been informed and told they really wanted to get away from the work load or caseload type data and more into what they called measurement indicators. So we shied away from typical work load data which ... we probably should have included in the measurement indicators .... When asked by Senator Raggio if he was making representations there had been a work load increase to justify the budget increase, Mr. Lange affirmed the statement. Ms. Sylva offered to provide the information. Ms. Sylva noted an increase in supplies, printing and authorization and medical supplies for increased laboratory tests under operating expenses. She said $5,079 in FY 1996 and $7,619 in FY 1997 are being requested to purchase vaccines. Decision Unit M-300, Ms. Sylva said, would provide merit salary adjustments, and M- 710 would provide replacement of medical and office machines for the 15 rural clinics. She said M-720 would provide for miscellaneous office equipment and upgrading in areas of communication. She explained the division was able to obtain federal funds under the immunization program for the upgrades. Mr. Spitler requested a history of the nursing staff turnover depicted in M-300. Ms. Sylva responded there was not a large turnover for some time, but lately nurses are leaving the state agency for the private sector. She declared the adjustment to which he referred is a normal adjustment. Laboratory and Research - Page 1133 Senator Raggio asked the committee to consider budget account 101-3221 regarding the public health laboratory. Ms. Sylva noted Las Vegas is served by the main laboratory in Reno and by a contractor for limited testing of milk, food-borne and water bacteriology. She pointed out the laboratory under contract in Las Vegas provides no chemistry testing. Ms. Sylva said the Bureau of Laboratory Services provides statewide public health laboratory analyses in several disciplines, such as microbiology, chemistry and technical support. She explained the technical support section provides environmental microbiology analyses of drinking water, surface water, waste water, food and dairy products, and certifies private laboratories under the federal Safe Drinking Water Act (SDWA) and the Clean Water Act. They also provide training and certify milk laboratories to allow interstate shipment of dairy products under the Food and Drug Administration (FDA). Ms. Sylva indicated expansion construction is under way at the laboratory as provided during the last biennium which will add another 8,500 square feet to the laboratory. Ms. Sylva stated the chemistry laboratory provides environmental chemical analyses of drinking water, surface water, waste water, air, soil and tissue. The section also certifies private laboratories that perform chemical analyses under the federal Safe Drinking Water Act and the Clean Water Act. Calling attention to the measurement indicators, Ms. Sylva noted they are based solely upon the number of tests performed. She acknowledged an error had been made under FY 1994 which should read $234,709 instead of $297,731. Ms. Sylva said the revenue consists of 58 percent fees for service provided and 42 percent from the General Fund. She listed the adjustments to the base as a reduction of $65,784 in federal funds to be found in E-425 and an adjustment for $3,000 in insurance. Senator Raggio inquired if the $430,000 adjustment is the result of more testing or an increase in fees. Mr. Lange replied, "It considers a fee increase we did this fall before the Sate Board of Health that I had mentioned earlier to IFC. Water chemistry was increased." As to Decision Unit M-200, Ms. Sylva said it would provide three new positions. She said the clerical position would support the laboratory director and the Chemist II position would assist in performance of sample analyses associated primarily with additional requirements of the SDWA program. She explained municipal water systems are under federal mandates regarding the type and frequency of tests that must be conducted, and 5,000 tests were performed in 1992 with an 80 percent increase to 9,000 tests in 1994. Recalling testimony earlier in the day, Senator Raggio asked if fees charged by the State Laboratory are lower than those charged by private sector laboratories and if the fees should be raised to be more competitive and do away with the necessity for General Fund revenue. Mr Lange responded a sample of five laboratories showed the state charges for cadmium tests were higher than three private laboratories, and the state charges for mercury tests were lower than four private laboratories. Senator Raggio asked if it would be feasible to increase the fees and still provide an appropriate service at a realistic cost and eliminate using revenue from the General Fund. Mr. Lange admitted a raise in fees could be considered. He conceded the state would like to encourage well owners to be tested by the public health service. He said: Part of the problem I've run into which the private lab does not have, if they've built up a profit and they can turn it toward a reserve every year they don't have a cash flow problem. My problem, like last year when I had to come before this committee and get money to end the fiscal year, I have no basis of carrying money forward from one year to the next .... Senator Raggio read a letter from the Senate Committee on Commerce and Labor (Exhibit N) which expressed concern the state was receiving subsidies via General Fund appropriations in competition with the private sector in commercial analyses. Ms. Sylva offered to prepare a response to the letter. Mr. Marvel asked if funding would continue by the federal government to implement the Safe Drinking Water Act. Mr. Lange replied as far as he knew the funding would continue although he anticipated it probably would not increase. He said information in a letter from the Environmental Protection Agency (EPA) he had received recently indicated the state must maintain a laboratory. Dr. Kwalick stated: We're required to do it by federal mandate if we want to continue to have primacy in the State Drinking Water Act, based upon what Ron [Mr. Lange] just said. But even if that letter is invalid it just follows in my mind that if you have a certification program of laboratories, in order to have primacy you have to have a certifying officer. The only way you can have a certifying officer is to have one that's working in a laboratory on a day-to-day basis who knows the technical things that have to be done to go out and test that laboratory to see if they are indeed certifiable. Ms. Sylva testified M-201 would provide $39,078 for additional costs for utilities and the agency requested $37,696 for operating supplies under the mandated SDWA program in M-580. She declared the agency recommends the two accounts be split because utilities are tracked in a separate category from operating expenses in the Executive Budget. Ms. Sylva stated M-300 would provide for merit salary adjustments. Decision Unit E- 175 would provide $1,506 for out-of-state travel to enable the Medical laboratory Director to represent the state at national state public health laboratory directors' meetings, she said. She declared: Decision Unit E-425 is the replacement of block federal funds due to changes in federal emphasis. The subsidies which went to the laboratory, $20,000 from the Sexually Transmitted Disease budget and $45,784 from the Safe Drinking Water fund. They've been removed from the base budget. Senator Raggio inquired if the state is losing federal funding under E-425. Mr. Lange answered: No, sir. For years ... I have been putting in approximately $20,000 in STD [Sexually Transmitted Disease] money into the lab budget to try to subsidize them for STD tests. The STD grant has stayed flat and we no longer can use that money for that purpose. But I have taken that $20,000 from the lab, and that shows up in Decision Unit M-200 budget account 3215, so the money's not being lost, it's just being transferred to the STD budget. Senator Raggio asked why the result is $130,000 in new General Fund enhancement expenditures. He pointed out a new $64,784 fund requirement under E-425 for each year of the biennium. He wondered if that meant another loss of federal funding. Mr. Lange responded it is not. He explained: That money has been going to the lab on an annual basis for the last ... 8 years for Safe Drinking Water, 8 to 10 years, and longer than that for the STD. But Safe Drinking Water people now say that they're not going to subsidize lab-type operations. They want this money to go towards management and information-type services as to the municipal water system. Mr. Lange continued: ... that $45,000 ... went toward funding a position in the consumer health protection budget. What we're doing, we're removing the $65,784 each year, placing it in two other budgets, and ... replacing that money with General Fund money in the state lab in order to maintain minimum funding levels. Mr. Spitler inquired if STD funding has been lost. Mr. Lange answered, "I did not lose it. It essentially said, this is not a legitimate expense anymore ...." Mr. Spitler asked what STD funds have to do with the state drinking water program. Mr. Lange replied: It has nothing to do with it. The narrative up there should have said it is to provide funding to meet rural delivery requirements. It's [a] result of loss of the STD and Safe Drinking Water funds. Senator Raggio queried, "We will need to know ... does this result in additional General Fund expenditures?" He noted the budget shows an increase in General Funds of approximately $250,000 each year. Mr. Lange asked, "Are you showing E-425?" Senator Raggio referred him to the laboratory and research items on page 1137 of the Executive Budget. Mr. Lange affirmed the query and said, "It buys us salaries, operating supplies, the laboratory is a labor intensive and a supply intensive ...." Senator Raggio asked, "And we're losing federal funds from a level of $103,000 down to $30,000. Is that the only place the federal funds appear or is there somewhere else? What's the ... $435,000 non-state? .... What's the last item under Other Non- State Resources?" Mr. Lange replied: A detailed break out of our revenue, we have budgeted Governor recommends approximately $70,000 in testing fees, $360,000 in water testing fees. We have a line item $318,000 in laboratory charges and $96,000 in user charges. They have combined approximately four line items and detailed merit into two line items and those would be your testing fees. Senator Raggio declared more detail is needed. Mr. Hettrick noted the budget includes three new positions, a one-shot appropriation of $375,000 over 2 years for new equipment and additional space for remodeling. He asked why there is no increase in projected income from licenses and fees while space and equipment are being added. Mr. Marvel concurred there is some confusion over licenses and fees and Other Non- State items. Responding to a request by Senator Raggio, Mr. Lange agreed to provide the information by the next day. Mrs. Evans suggested the mission statement should be expanded and the figures regarding testing should be extended. Communicable Disease Control - Page 1147 Ms. Sylva testified that budget account 101-3220 provides clinic and treatment services for indigent individuals who have tested positive for tuberculosis (TB). She added the program includes services for individuals eligible under the federal Refugee Program and the federal TB Elimination Grant program. She said at the beginning of FY 1995 the Health Division received a new federal grant for Breast and Cervical Cancer screening which also is administered under the budget. The budget provides limited funds for epidemiology. Ms. Sylva noted the budget would provide diagnosis and inpatient care. She averred the incidence of TB suspects grew by 27 percent in 1994 over 1993 while the number of those being treated increased by 51 percent. Ms. Sylva explained the measurement indicators reflect the work load. She said 76 percent of the revenue would be derived from General Funds, $220,000 would come in from two federal grants, and $27,000 would come from the TB Refugee and TB Elimination Grant program. Ms. Sylva said the program received an IFC allocation of $319,000 in FY 1994 and $330,000 in FY 1995 to offset increased costs due to growth, a level to be maintained in the adjusted base. She declared the adjusted base would continue the actual expenditure level of 1994 with the exception of the TB Elimination Grant program. She said 1994 actual expense was $46,226 and $123,455 is being recommended for FY 1996 which she described as "an annualization of a grant received during state Fiscal Year 1994." Ms. Sylva explained the expenditures of the base year does not reflect projected annual costs, 86 percent of which would be allocated to Clark and Washoe Counties. Ms. Sylva said Decision Unit M-100 reflects inflation while M-200 includes requests for $3,000 for Out-of-State Travel. She described M-201 as providing residential care funding for additional patients in the amounts of $22,500 and $26,250 in the 2 years of the biennium. She said residential care would insure that indigents with TB would receive supervised medication until they became noncontagious. Ms. Sylva declared an additional $41,522 would be provided in FY 1996 and $70,692 in 1997 to cover costs of additional medication, which she attributes to a 13 percent increase for patients who are drug resistant. She said in 1994, $382,951 was spent on drugs. She explained costs for a nondrug resistant patient might be $10 per month while medication for drug-resistant patients could cost as much as $800 per month. She said in FY 1996 the requested increase would be 14 percent and it would be 18 percent in FY 1997 over FY 1994 costs. Ms. Sylva stated Decision Unit M-201 would include $17,465 for laboratory tests. Senator Mathews asked if the figures showing those who are Human Immunodeficiency Virus (HIV) positive came about as an accidental finding when people were tested for TB. Dr. Kwalick responded the finding was just the opposite, there are increasing numbers of HIV positive patients who are becoming TB positive as a secondary infection to the HIV. Mr. Arberry requested an explanation of In-State and Out-of-State Travel. Senator Raggio pointed out the category includes Out-of-State Travel for Breast and Cervical Cancer programs. Mr. Lange responded: The $3,000 in M-200 establishes a base out-of-state allotment for Dr. [Randall] Todd to travel to [Center for Disease Control] CDC for other than the cancer registry program. As the ... epidemiologist for the state, he ... is required to go back to CDC, for example, on this Hanta virus outbreak. That is completely separate and distinct from this E-850...Breast and Cervical Cancer program. Those funds have to be used for that purpose and I cannot mix apples and oranges. If he needs to go back to CDC, which is primarily where he goes, we just have to put $3,000 a year in the base TB budget, the Communicable Disease budget. Senator Raggio suggested Mr. Lange break out the information and provide a compilation of how Out-of-State Travel has been computed because the amount appeared to be unusually high. Ms. Giunchigliani requested more information on the new funding for residential care services for the homeless and indigent in Clark County. She noted communicable diseases have been divided into so many parts it is difficult to determine if services are being duplicated. She listed regulatory functions, prevention functions, and wellness functions as some examples of the various services listed. She asked if there was "a more global way" to state the mission and to give the committee a better idea of what needed to be provided to the community. She called it "ludicrous" to segregate the various functions. Senator Raggio indicated special travel funds are addressed in E-850. He asked if those are all federally funded and if the programs are contracted out. Ms. Sylva replied part of the funds are contracted out. She explained the needs for services would be assessed in the first year of the grant and risk groups would be identified. After that, she said, "We will likely be contracting with an agency to provide education within the community." Ms. Sylva acknowledged the funds would support four positions as well as contracting out programs. If funding is removed the positions would be removed, she said. WIC Food Supplement - Page 1151 Senator Raggio called for a discussion of the federal Women, Infants and Children (WIC) food supplement budget account 101-3214 on page 1151 of the Executive Budget. Ms. Sylva reported the budget is entirely funded by federal monies to provide nutritional counseling, education and supplemental foods to eligible pregnant, post- partum and breast-feeding women, infants and children. She said the WIC program is administered statewide through contract agencies in Washoe and Clark Counties and directly by the state in rural areas. Ms. Sylva stated there are 28 such clinics in Nevada, with an average caseload of 26,693 participants per month, projected to increase to 31,992 in Fiscal Year 1996, a 20 percent increase, and up to 33,454 in FY 1997. Ms. Sylva explained eligible participants receive food vouchers to be redeemed at contracting retail stores. She said the revenue comes from a United States Department of Agriculture (USDA) grant and from rebates to the program based upon the amount of infant formula and cereal purchased. Ms. Sylva reported the base budget carries forward expenditures with adjustments to fully fund two personnel positions added during Fiscal Year 1994 by the IFC. She described an adjustment to information services to reflect the deletion of one-time purchases and $5,374 to be transferred to Decision Unit M-200. Ms. Sylva said, "State cost allocation is adjusted to reflect projected programs share of cost based on the negotiated rate." She stated M-100 deals with inflation, while M-200 recommends federal and rebate funding for the expansion of the WIC program through a projected caseload increase of 20 percent over base in FY 1996 and 25 percent in FY 1997. She explained: The distribution of revenue is through various expense accounts, specifically personnel, operating, aid to individuals, vendor refunds, central bank account and the line item called State Food Support which is the category titled Clinic Operation. It supports the distribution of administrative funds to contract clinics. Ms. Sylva said the information services expenses would cover monthly charges as well as computer software and hardware for the new positions. She indicated M-201 would raise two part-time employees to full-time employment and one part-time employee to 3/4-time employment in Pahrump, Elko and Minden. Decision Unit M-300 would provide merit salary adjustments, Ms. Sylva said, and E- 222 would increase food grants through the USDA by 4 percent per year to cover inflation. She noted E-710 would provide for replacement of office and medical equipment. Decision Unit E-912 would transfer a computer specialist to DIS in accordance with the Governor's reorganization plan. Mr. Spitler commented the USDA had specifically approved the computer specialist position. He asked if the transfer would jeopardize the grant and he asked where the budget reflected the payment to DIS for those services. Ms. Sylva replied: Because no USDA funds were removed it is expected that the agency would be in a position to purchase the services. However, the authority was not, as I understand it, left in here. Mr. Riggs explained the Budget Division agreed the position should have been offset and the entry would be corrected. Ms. Giunchigliani suggested the measurement indicators are misleading and should show the number of women, pregnant women, infants or children receiving service. She asked why the Baby Your Baby program is not included in the WIC program, and she asked if the WIC programs utilizes the Rural Clinics. Ms. Sylva replied: When there are spaces available we do utilize the community health nursing space services or sometimes community health nursing staff to augment the WIC program in the rural areas....The WIC program is located within Family Health Services Bureau. That is the bureau where Baby Your Baby is located. Baby Your Baby and the WIC program ... are natural links and work closely together. Ms. Sylva added every woman who calls the information hot line is referred to the Baby Your Baby program. Health Aid to Counties - Page 1157 Ms. Sylva continued with a discussion of budget account 101-3209, which she identified as "flow-through funds to the Clark and Washoe District Health Departments in return for those districts providing full-time public health services to their citizens." Ms. Sylva stated most of the revenue being passed through is primarily from the General Fund at a rate of 65 cents per person based upon population data provided by the Office of the State Demographer. She said the adjusted base revenue is a continuation of FY 1994 funding, and M-200 is based upon population growth. The increase to Clark County would be $68,145 in FY 1996 and $88,033 in FY 1997, while the increase to Washoe County would be $13,288 in FY 1996 and $16,329 in FY 1997. Ms. Sylva explained the funds are used for a variety of things including nursing services, maternal child and health services, supplemental emergency medical services, air pollution control, hospices, senior home health services and other services. David Rowles, Director, Administrative Services, Clark County Health District, commented Health Aid to Counties has been part of the district for more than 20 years. He called it a "cooperative relationship" with the state in the administration of state-mandated programs which he described as a form of health cost-sharing. He asserted local health authorities are better equipped and staffed to carry out local programs. He added the program is used as a source of funds for in-kind matching grants from the federal government. Mr. Rowles asked the committee to review Exhibit K containing a list of services with augmenting narratives and statistics on clients served through the fund. He pointed out there is no administrative overhead from the Health Aid to Counties funding, all the funding would be used for direct services. Mr. Rowles noted the needs of the approximately 6,000 people moving into Clark County each month are growing. He called attention to graphs in Exhibit K depicting past usage of Health Aids to Counties and projected growth. Mr. Rowles reminded the committee the daily nonresidence population in Clark County is over 100,000 due to tourism. He asserted tourists provide an additional impact on health services and they, too, must be protected by public health authorities. David E. Rice, M.P.H., District Health Officer, Washoe County District Health Department, called attention to the graphs included in Exhibit L depicting population and health aid growth in Washoe County along with the 1993-1994 annual report for the district. As an example of growth during the 5 years while Mr. Rice has held his position, he said, child health field visits have increased by 50 percent. He indicated emergency medical transport services increased 19 percent, grant administrations increased by 100 percent, geriatric health services clinic visits increased by 29 percent, immunizations increased by 49 percent, and temporary food permits increased by 166 percent during that period. He averred air quality has improved the number of good days from 150 to 240 according to the pollution standard index. Mr. Rice referred to a list of services on page 4 of the annual report. He told the committee a 1993 study by life insurance companies on the health status of states ranked Nevada 45th in support for public health on a state level. There being no further testimony, Senator Raggio turned to budget account 101-3213. Immunization Program - Page 1159 Ms. Sylva described the long-term goal of the immunization program as the prevention, control and eventual eradication of all vaccine-preventable disease among all Nevadans. She explained vaccines are provided through the program to all public and private health-care providers. She declared the program has grown considerably during the past biennium due to increased state and federal funding. Senator Rawson asked if the requested increases would be adequate to ensure the health of the citizens, and he inquired what level of the population should be immunized for childhood diseases to provide security. Ms. Sylva replied the budget should be adequate to meet the needs of children in the state due to the dramatic increase in federal funding from several grants. She said the goal for immunization is simply to reach as many families as possible. She estimated 95 percent of Nevada school children and day-care children are immunized. Dr. Kwalick interjected the problem is not with those entering school but with younger children. Mr. Spitler asked for an explanation of "surveillance" as an expenditure. Ms. Sylva replied, "Surveillance is a Centers for Disease Control initiative that improves our ability to detect all vaccine-preventable diseases." Senator Jacobsen commented Douglas County had run out of flu vaccine in both of the past 2 years. He asked for an explanation. Sandra Fairburn, R.N., Chief, Bureau of Community Health Services, Health Division, Department of Human Resources, responded the flu and pneumonia vaccines provided for senior citizens in the state are not provided through the immunization program. Because there is no federal or state funding, she said, those vaccines are purchased and sometimes they are not available for purchase. Pointing out a $56,000 item spent in 1993, Senator O'Donnell asked if that was used to purchase computers and what arrangements are in effect with DIS for computer support. Mr. Lange replied the $56,000 was a one-time grant for a community immunization action plan. He said David Nelson, an employee of the CDC, was assigned to Nevada to run the immunization program. David Nelson, Manager, Immunization Program, Health Division, Department of Human Resources, acknowledged a private foundation had enabled him to purchase computer equipment to set up computerized tracking of immunizations throughout the state. He explained part of the grant was used for two full-time employees to set up the system and input data. He stated they coordinated with DIS, but not for the day-to-day work on the system. Senator O'Donnell asked why there was a $900,000 increase in expenditures during 1994-1995. He suggested that was high for a total budget of $2.3 million. Mr. Lange replied Part of it is in personnel, and that's because of the new positions we added in late 1994 or first part of 1995. You have $250,000 increase there. Perineal hepatitis grant is $30,000 more, vaccines, it's essentially $140,000 more, and Medicaid health for reimbursements, that's really inflated. That's where we get reimbursed from Medicaid and that's budgeted at $673,492, because when we did this 2 years ago we weren't exactly sure what we were going to have returned to us from Medicaid. The actual was $241,000. The actual this year will probably be around the same. Emergency Medical Services - Page 1163 Ms. Sylva stated Emergency Medical Services (EMS) regulates a network in rural Nevada wherein it sets criteria, it certifies emergency medical technicians (EMTs) and training course instructors, and it licenses ambulance attendants, firemen and others. She said EMS is responsible for issuing permits for operation of all ambulance services and investigates complaints. EMS and the Board of Health are responsible for the coordination of a statewide trauma network, she added. Ms. Sylva said the measurement indicators for budget account 101-3235 are reflective of work loads, with funding primarily from General Fund appropriations. She declared the base budget includes significant federal funding although one federal grant had been terminated on September 30, 1994. Ms. Sylva continued: The adjusted base is 1994 actual with adjustments for personnel to reflect the loss of a federal EMSC [Emergency Medical Services for Children] children's program grant, and operating was adjusted for rent, again all related to the ... ending of the EMSC grant. And the state cost allocation was deleted due to the loss of that grant also. Ms. Sylva indicated M-100 covers inflation, M-200 would provide operating expenses for a new clerical position due to a projected 6 percent caseload increase and office equipment for the new position. Ms. Sylva declared EMS certified 4,169 personnel, licensed 1,117 ambulance attendants and processed 132 training courses in FY 1994. She said 6,320 trauma cases were added to the statewide registry. She estimated the work load would increase by 6 percent based upon population growth. Ms. Sylva declared M-201 would provide additional funds for travel because funds for travel have been inadequate in the past. She explained the staff must inspect approximately 65 ambulance services once a year, must monitor all training courses, provide testing on all courses, and meet with fire boards, hospital boards and county commissioners in relation to EMS services. Ms. Sylva indicated merit adjustments are included under M-300. Senator Rhoads reported he has received several calls indicating funds for travel and training have been inadequate for the past 6 years. He asked for an explanation. Mr. Lange responded: Its a case ... where we built a conservative budget and when you go by your base year expenditures, it's hard to ... just apply additional expense. But you're right, we have been short on revenue, we have curtailed travel....I think this should take care of it. Senator Rhoads asked where the four positions to be deleted depicted on Executive Budget page 1164 would be cut. Mr. Lange answered they were part of a federal program and the positions were removed when those funds were removed. Consumer Protection - Page 1167 Ms. Sylva stated: The Bureau of Health Protection services provides regulatory and professional services in the areas of public health including engineering plan review, public health sanitation, radiological health, and the federal Safe Drinking Water program. She acknowledged radiological health is addressed in a separate budget. Ms. Sylva explained Consumer Protection services funds inspection and enforcement at 4,506 facilities including food establishments, hotels, motels, institutions, schools, correctional facilities, trailer parks, milk plants and dairies. She said staff also must make inspections when fires or wrecks involve food or drugs. She added plan reviews must be made of commercial developments and sewage disposal systems. Ms. Sylva stated activities include investigation of transmission of disease and the licensing and manufacturing of drugs or cosmetics. Ms. Sylva said the state has accepted primacy from the federal government for the Safe Drinking Water Act through an agreement between the Governor's Office and the United States Environmental Protection Agency (EPA) and the state is responsible for implementation of the program. She declared the program is mandated but not fully funded and it is costly to the state. She admitted there are advantages in adopting primacy. She asserted: By adopting state regulations through the state Board of Health the division then has the flexibility in certain enforcement areas. The Health Division can grant waivers if appropriate, and we work with the water systems on developing compliance schedules until they can meet the requirements. Ms. Sylva estimated a savings of over $36 million for Nevada water systems through the process. She asked the committee to review Exhibit M. Ms. Sylva noted three additional positions are being requested to support the program which has been recommended by an interim study. Ms. Sylva indicated adjustments to the base included the three positions, travel to include an additional motor pool car, rent and insurance under operating, and special projects which were reduced to reflect a one-time balance forward. She stated: Aid to counties has been adjusted to contractual authority for Clark and Washoe Counties, and the Department of Energy grant was adjusted to an annualized grant award level. The state cost-allocation was adjusted to meet projected costs. Ms. Sylva said M-100 is for inflation, M-300 is for merit salary adjustments, and M- 580 is for the Safe Drinking Water Act. She reiterated the recommendation for three positions, including one approved by IFC for a Management Analyst position funded by the federal government. She stated the Public Engineer III position would be funded by state appropriations to provide oversight to water systems in Clark County. According to Ms. Sylva an Environmental Health Specialist position would be responsible for monitoring lead and copper in public water systems. The position would provide technical assistance to water systems, monitor data collection, analyze for compliance, and perform any required enforcement activities. Due to lack of staff, she said, USEPA granted the state an extension in implementing the federal lead and copper rule with the proviso the position be requested at this legislative session. Ms. Sylva said the IFC approved the federally funded Management Analyst position after pressure from the USEPA for Nevada to establish a water system management program. She explained it is part of a federal pilot program, and it will include funding for travel, rent, operating and office equipment. Ms. Sylva stated E-425 would provide Out-of-State Travel for environmental health specialists to attend annual training required by the Food and Drug Administration (FDA) in order to maintain federally certified food specialists. She indicated Decision Unit E-426 should be deleted because funding will not be available. Senator Coffin asked, "When you lose your federal funds for a position, do you go through a diligent process to determine if we ... should have the position and then decide whether or not to put in a budget request for additional funds?" Ms. Sylva replied, "Absolutely, we would do that. If we felt that it would harm the safety or not protect Nevadans we would certainly request funding." She explained the position under E-426 is new and has never been filled. Mr. Lange interjected the position would have provided oversight at the high level test site in Clark County. He stated: The need does exist. We just have one man down there and it's a long way from Las Vegas out to the test site, but ... he just spends less time at the test site than we would normally like to have. The need exists but we did not ask the state to pick up the costs. Senator O'Donnell remarked there had been an occurrence in Las Vegas when some bacteria got into the water system which caused concern among his constituency. He asked how that could be precluded from happening again. Dr. Kwalick responded the reference was probably due to an outbreak of cryptosporidiosis for which no proof had been offered that it was due to cryptosporidium in the water. He admitted the investigation is ongoing because statistically it would appear the water was the source. He emphasized, "That water system is among the best in the nation." Even with the water quality in Nevada and particularly in Las Vegas being so good, he contended, there are risks everywhere. He stated remedies include filtration and using ozonization but aside from boiling the water there is no known remedy. He suggested anyone who is immuno-compromised, such as HIV positive persons or those on chemotherapy, should use bottled water. Jeffrey Fontaine, Supervisor, Public Health Engineering, Bureau of Health Protection Services, Health Division, Department of Human Resources, concurred with Dr. Kwalick that the Clark County water system is one of the best in the country. He explained there are over 30 surface water suppliers in the state which have met similar problems. Lacking federal guidance, he indicated, the state is implementing initiatives to deal with such problems. Radiological Health - Page 1173 Ms. Sylva stated the agency regulates licensure and inspection of radioactive material users and certification of X-ray devices and machine operators. She added under an agreement with the Food and Drug Administration (FDA) the agency implemented the Mammography Quality Standards Act of 1992. She said the agency also participates with the United States Department of Energy in the oversight of radiological activities at the Nevada Test Site and post-closure activities at the low-level waste site at Beatty. Ms. Sylva said the oversight and monitoring of water-migration and soil samples will continue for the next 100 years. Calling attention to the performance indicators, Mr. Hettrick asked if there are any mammography operators or machines in use that are not certified. He indicated the indicators are not clear and should be expanded in order for the committee to judge the effectiveness of the program because nothing was demonstrated except "positives." He wanted to know how many machines are not certified, how many machines require repairs and other similar data. Ms. Sylva replied, "We're trying to show you what we have done." Mr. Lange responded: To put the women in the audience, on the committee, minds at ease, we have put some operators out of business. We have fined some, some hefty fines, I'm talking four figures. But we haven't advertised the fact we ran so-and-so out of business. Mr. Allard agreed more information is necessary in order for the legislators to judge performance. Senator Raggio turned the gavel over to Mr. Marvel. Mr. Spitler asked where funds from fines appear in the budget. Mr. Lange thought some went into the General Fund. Mr. Spitler inquired how much was levied and where the money went. Stan Marshall, Supervisor, Radiological Health Section, Health Division, Department of Human Resources, declared fines collected under the mammography program go into the General Fund. When asked for an amount, he replied, "To my understanding it's not received by the agency." Mr. Lange interjected, "It's a direct deposit to the General Fund." He agreed to provide the information. He said, "If we do provide the information on the fines and number of places we closed down or operators we put out, I'd really like to delete the names." Mr. Spitler said the figures would suffice. Senator O'Donnell voiced agreement with Mr. Hettrick. He acknowledged information was being gleaned from the questioning in progress, but cited a need for more specific information. Mr. Lange agreed to provide more information regarding problems and the remedies used. Senator Mathews voiced a desire for more information regarding food services as well as radiological information. Ms. Sylva pointed out those facilities, machines and operators that have been certified display a certificate. Mr. Hettrick noted appropriations in M-202 for $12,000 each year in standby pay for the statewide emergency response program. He asked if that had already been included in the base budget and if it should be removed. Mr. Lange answered it had not been included in the base budget. He called attention to Agency Transfers under revenue, specifically to an agency request for $184,431 with a recommendation by the Governor for $172,431. He said the $12,000 difference is the figure in the Decision Unit which has been backed out of the original base budget. Mr. Lange explained, "Four years ago we had standby pay. Last biennium I goofed. I didn't do it and we had to pay in comp time, which really is nonproductive because it takes away from their work week." Calling attention to Decision Unit E-850, Ms. Sylva reminded the committee the Office of Vital Records has a need to expand the vault into the space currently occupied by the radiological section. She stated the resultant relocation would be funded by the unit for rent, moving and telephone installation. She acknowledged the agency failed to include rent for 600 square feet at a cost of $4,572 in the FY 1997 request. Ms. Sylva explained a one-shot appropriation request for $23,000 would cover the cost associated with the reconstruction of the information systems network due to the move. She said it would consist of computer hardware and software. Charles E. Lawson, Lobbyist, Nevada Rural Water Association, offered support for the request for additional personnel in the consumer protection agency. He explained the association anticipates problems would arise due to the requirements of the Safe Drinking Water Act. Mr. Lawson stated he is a director for the National Water Association representing Nevada, and as such he wished to make the committee aware of a safe drinking water bill under consideration in the United States Congress. He expressed concern over the intentions of one of the senators who attacked two regulatory measures to require agencies to complete cost-benefit analyses before issuing regulations and who criticized proposals to compensate property owners for regulatory actions that would reduce property values. He concluded, "This doesn't indicate to me that we're going to get a friendly safe drinking water act out of Washington." Mr. Lawson acknowledged the SDWA would continue. He declared the state agency is excellent and he expressed appreciation for Mr. Fontaine. In offering support for additional personnel, he said, "We want the regulatory agency in the state so we can go talk to him." In the absence of further testimony, Mr. Marvel adjourned the meeting at 4:52 p.m. RESPECTFULLY SUBMITTED: Judy Jacobs, Committee Secretary APPROVED BY: Senator William J. Raggio, Chairman DATE: Assemblyman Morse Arberry, Jr., Chairman DATE: Senate Committee on Finance Assembly Committee on Ways and Means February 7, 1995 Page