MINUTES OF THE SENATE COMMITTEE ON FINANCE Sixty-eighth Session March 20, 1995 The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:00 a.m., on Monday, March 20, 1995, in Room 223 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. 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 STAFF MEMBERS PRESENT: Dan Miles, Fiscal Analyst Bob Guernsey, Principal Deputy Fiscal Analyst Marion Entrekin, Committee Secretary OTHERS PRESENT: Robert L. Seale, State Treasurer, Office of the State Treasurer John Adkins, Deputy of Cash Management, Office of the State Treasurer Darrel R. Daines, State Controller, Office of the State Controller Ken West, Chief Deputy Controller, Office of the State Controller William A. Bible, Chairman, State Gaming Control Board Ed Allen, Chief, Electronic Services, State Gaming Control Board Harlan Elges, Chief, Administration Services, State Gaming Control Board Lorne J. Malkiewich, Director, Legislative Counsel Bureau David Whatley, Facilities Manager, Buildings Unit, Legislative Counsel Bureau Gary Crews, Legislative Auditor, Audit Division, Legislative Counsel Bureau Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau Robert E. Erickson, Research Director, Research Division, Legislative Counsel Bureau Fred W.Welden, Chief Deputy Research Director, Research Division, Legislative Counsel Bureau Janice L. Thomas, Secretary of the Senate, Legislative Counsel Bureau Dennis J. Healy, Attorney at Law, Law Offices of Walter R. Tarantino Senator Raggio thanked the members of the committee who presided over the Senate Committee on Finance on March 15 - 17, 1995 while he and Senator Jacobsen attended a conference in Washington, D.C. He remarked the conference involved many topics, but of particular interest was discussion concerning various proposals pertaining to welfare and health-care reform. Senator Raggio said the uniform feeling of the majority of legislators in attendance is that the welfare system has failed. They feel it has become a cause more than a cure for many of the economic ills of the less fortunate. He remarked most agreed work programs should be a component of any welfare reform that takes place, but how the states will deal with the funding and flexibility aspects of welfare reform remains questionable. He mentioned the legislators were assured the funding would not be reduced, but the growth of funding would decrease. They were also advised sufficient flexibility will be provided to the states to design their own programs, which will result in less cost. Senator Raggio opened the hearing for discussion of Senate Bill (S.B.) 201. SENATE BILL 201: Makes appropriation to office of state treasurer for automated check distribution machine, computer hardware and office equipment. Robert L. Seale, State Treasurer, Office of the State Treasurer, introduced John Adkins, Deputy of Cash Management, Office of the State Treasurer, who provided an explanation regarding equipment and computer purchases needed in the Office of the State Treasurer in the amount of $19,068 to be appropriated from the General Fund. Mr. Adkins distributed Exhibit C, a summary of one-shot appropriation items, which he outlined with the committee. He explained the $19,068 requested by S.B. 201 is in agreement with the Governor's recommendation, but was moved from a budget enhancement item to a one-shot adjustment. The purchases would include the replacement of the computers for travel advance activities and the cash management program, replacement of a copy machine and a new letter folding/check stuffing machine. Senator Raggio closed the hearing on S.B. 201 and opened the hearing on Senate Bill (S.B.) 202. SENATE BILL 202: Makes appropriation to state controller for equipment and computer enhancements and remodeling of basement of capitol annex. Darrel R. Daines, State Controller, Office of the State Controller, introduced Ken West, Chief Deputy Controller, Office of the State Controller, who gave a brief presentation regarding remodeling costs, software and equipment purchases essential to the Office of the State Controller proposed by S.B. 202. Mr. West called the committee's attention to Exhibit D, and provided a detailed review of the items reflected in the summary of the one-shot appropriation from the state's General Fund for the purchase of office equipment in the amount of $38,238. Senator Raggio pointed out at the time the budget for the Office of the State Controller was reviewed before the Senate Committee on Finance, a lengthy discussion was made regarding the items listed in Exhibit D. He suggested further discussion be curtailed unless there is disagreement with any of the items included in the one-shot appropriation of $38,238. Mr. West said not included in the $38,238 is a request by the Office of the State Controller for three personal computers. He said this would expand the number of computers from 23 to 26 to accommodate all of the accountants and programmers within the office. He reminded the committee the office only requests revenue for new computers to provide for expansion of personnel within the office. Otherwise, replacement of a personal computer is accommodated through savings within the budget. Senator Raggio asked the total cost for three personal computers, and Mr. West said the total cost is $9,000 which, added to the S.B. 202 appropriation, increases the one-shot request from $38,238 to $47,238. Senator Raggio asked Senator O'Donnell if $9,000 is a reasonable cost for three computers, and Senator O'Donnell answered in the affirmative. Senator Raggio noted the major item requested by the one-shot appropriation is to remodel a basement area for centralized data processing that will amount to $12,900. Mr. West said by remodeling the basement area, the agency will be able to centralize the controller's data processing function in the basement of the Capitol Annex and will provide office space they must have to accommodate new equipment. The new space will also provide an environmentally comfortable area and additional space for personnel who will be situated there. Senator O'Donnell asked if the agency will retain the Hewlett Packard (HP) computer now situated in the office. Mr. West said they would keep the HP which is twice the size of a personal computer. Mr. West said the new HP machines are in the same office environment but do not discharge as much heat as the old machines. Therefore, the air conditioner capacity devoted to the present computer room can be shifted to the basement area. Senator Jacobsen asked if the proposed basement computer area will be in the same area as that used by the Governor's Office. Mr. West said the area the office wants to remodel is in the Capitol Annex basement and not in the same area as the Governor's computer room. Senator Jacobsen asked if there is salvage value associated with any of the computers being replaced in the Office of the State Treasurer. Mr. West replied after about 8 years of use their economic life has been depleted. He said there are three personal computers that have been placed on surplus, but he doubts another agency will use them. Senator Coffin asked if there will be a need for a fire suppression system in the proposed basement computer room. Mr. West said there will be no reason to have an elaborate fire suppression system due to modern technology that prevents problems associated with the discharge of heat. He said all of the system and data files for the Office of the State Treasurer are saved to an outside location. Mr. West remarked, "If our building collapsed we would be back in operation within 48 hours." Senator Raggio closed the hearing on S.B. 202 and opened the hearing on Senate Bill (S.B.) 197. SENATE BILL 197: Makes appropriation to state gaming control board for computer and office equipment. William A. Bible, Chairman, State Gaming Control Board, testified the passage of S.B. 197 will provide a one-time General Fund appropriation of $390,406 to the State Gaming Control Board to be used for computer and office equipment enhancements and is recommended in the Governor's Executive Budget. He referred to a three-page list (Exhibit E) distributed to the committee itemizing the computer and office equipment requested by the one-shot appropriation. Referencing Exhibit E, Ed Allen, Chief, Electronic Services, State Gaming Control Board, reviewed each of the board's equipment requests with the committee. Senator Coffin asked if the Pentium-based personal computers the board has requested are guaranteed to be error free. Mr. Allen answered in the affirmative. He explained by the time the board is ready to make the actual purchase, he is certain the error-free models will be the only style available. He said the Intel Corporation will replace, at no charge, any Pentium-based personal computer containing a floating-point error. Senator Coffin asked if a test has been devised to detect a floating-point error. Mr. Allen said there are several different tests that have been published in many computer publications. Mr. Allen resumed his testimony from Exhibit E. Senator Raggio asked where the 12 portable computers and 37 terminals the board is requesting will be used. Mr. Allen said the 12 portable computers will be assigned to investigative agents in the field, and the 37 terminals are intended for the board's new office building in Las Vegas to equip a work station for the majority of the agents. Senator Raggio asked what the board will do with the equipment located in the old office building in Las Vegas. Mr. Allen said with the exception of the replacement equipment listed on page 1 of Exhibit E, the board will retain the remaining equipment. Senator Mathews asked if there are security measures being used with the laptop computers the agents use in the field. Mr. Allen assured Senator Mathews security measures are in place. Continuing his testimony from Exhibit E, Mr. Allen pointed out within the request the board included data-link equipment to provide dedicated leased telephone lines between Las Vegas and Laughlin, and between Reno and Elko. He explained the dedicated lines will save toll costs and will free up time for clerical staff in the Las Vegas and Reno offices to assist in other work-related projects. Senator Mathews inquired if all of the board's investigators are computer literate. Mr. Bible replied not all of them are, but over the years the board has almost been forcing their employees to utilize computers and actually perform data entry themselves. Senator Mathews asked if training is included in the State Gaming Control Board's budget, and Mr. Bible replied the board has substantial amounts of training funds budgeted. Referring to page 1 of Exhibit E, Senator Raggio asked if any of the replacement furniture the board requested can be supplied through prison industries. Mr. Bible responded he did not think so because the prison industries do not make office chairs. However, he will look into this possibility and advise the committee accordingly. He remarked the board does utilize the prison industries for other types of office furniture. Senator Jacobsen asked if there is adequate space in the board's present space to house all of the equipment requested. Mr. Bible replied there is adequate space. In fact, he said the board just gained a substantial increase in space when they moved to the state office building in Las Vegas from non-state space. Senator Raggio closed the hearing on S.B. 197 and opened the hearing for discussion of Senate Bill (S.B.) 207. SENATE BILL 207: Makes appropriation to State Gaming Control Board for system which allows payment of taxes electronically. Mr. Bible testified S.B. 207 will appropriate $54,400 to the State Gaming Control Board to implement a system that allows the gaming industry to electronically file tax payments, and to prevent delays in posting state gaming revenues to the state treasurer. The appropriation will provide for the purchase of separate computer hardware and software for the system which, for security reasons, will not be a part of the main board's computer system. Mr. Bible said the State Gaming Control Board currently has a number of licensees who remit various data elements electronically, and the new system will expand the process which will eliminate a vast amount of key-punching activity currently being accomplished by the board. The system will also provide efficiencies to the licensees. He remarked the proposed system would not be a mandatory program although he anticipates the larger group 1 and 2 licensees in the state will utilize it. Mr. Bible said the board conducted a survey, and out of 100 licensees polled, 97 expressed a definite interest in the new system. Mr. Bible commented the state will gain 2 additional days interest accumulation by having tax payments remitted to the board electronically. Senator Raggio asked how the payment process is accomplished electronically. Mr. Bible answered it is accomplished through a series of electronic transfers. Instead of using paper, an electronic filing method is used to create a debit in one area and a credit in another for distribution to the appropriate place. Senator O'Donnell remarked the technology in the banking industry is already present and functioning in several retail outlets such as grocery stores and department stores whereby a customer can use a bank card to purchase items. Mr. Bible stated Exhibit F itemizes the equipment requested by S.B. 207. Senator Coffin pointed out since the licensees will be able to communicate directly with the State Gaming Control Board, what security measures will be employed. Mr. Bible explained the board will be using an independent computer from their main- frame, and a safeguard is built into the system to prevent licensees from accessing the mainframe to perhaps obtain data pertaining to another licensee. Mr. Allen said the biggest security barrier is the fact it will be a separate computer system, which means there will not be any other direct interfacing with the board's computer system that contains confidential or sensitive information. In the future, the board hopes to move some of the public information that is available on their present system over to the new system so that it can also be accessed by licensees or the general public. Senator Raggio closed the hearing on S.B. 207. Legislative Counsel Bureau - Page 157 Lorne J. Malkiewich, Director, Legislative Counsel Bureau, advised the committee testimony regarding the Legislative Counsel Bureau's (LCB) budget will be extracted from Exhibit G (on file in the Research Library), a 36-page document provided to the committee. He explained he will discuss the budget as a whole, the budget of the Legislative Commission, and the budget of the Administrative Division, after which testimony pertaining to the various divisions will be provided by the respective division chiefs. In discussing the budget as a whole, Mr. Malkiewich stated the proposed increase in salaries for state employees of 4 percent for Fiscal Year 1995 - 1996 and 3 percent for Fiscal Year 1996 - 1997 will cost $338,684 in Fiscal Year 1995 - 1996 and $610,944 in Fiscal Year 1996 - 1997. He said the Governor has included the costs separately within the Executive Budget, but not within the LCB budget account. According to Mr. Malkiewich the group insurance increases proposed in the budget of $253.09 in Fiscal Year 1995 - 1996 and $279.50 in Fiscal Year 1996 - 1997 will cost the LCB $52,328 in Fiscal Year 1995 - 1996 and $93,888 in Fiscal Year 1996 - 1997. Using Exhibit H, the remainder of Mr. Malkiewich's testimony was read for the record. Referring to decision module M-300, Senator Raggio asked that a break out be submitted to the committee reflecting the actual cost increases for job reclassifications for 14 positions in the Legal Division, five in the Research Division, five in the Fiscal Analysis Division, six in the Audit Division, and eight in the Administrative Division. Mr. Malkiewich agreed to submit the requested information to the committee immediately. Mr. Malkiewich transferred attention to Exhibit G and highlighted the critical portions of the Legislative Commission's budget with the committee reflected on pages 8 and 9. Senator Raggio referred to the budget item for association dues of $127,244 reflected for Fiscal Year 1995 - 1996 and Fiscal Year 1996 - 1997 shown on page 8 of Exhibit G and asked if the amounts represent increases. Mr. Malkiewich answered the amounts are total fees for each of the years. Senator Raggio asked for a break out of association dues for the last 6 years reflecting the increases that have taken place. Mr. Malkiewich replied the information will be promptly provided to the committee. Senator Coffin asked the amount of the association dues, and Mr. Malkiewich replied the dues are $1,000 per year and are paid out of the Legislative Commission's budget. Senator Raggio asked if any other dues are deducted from the budget, and Mr. Malkiewich replied no other dues are paid out of the Legislative Commission's budget. He believes some of the other divisions pay dues for some of the professional oversight groups of which legislative auditors are members. Senator Raggio commented in the course of reviewing other budgets, the committee has asked about continuing education costs and professional dues. He stated the committee will require an itemization of any such costs that occur within the LCB budget. He stated the committee also wishes to establish a consistent policy for these costs for all agency budgets. Mr. Malkiewich agreed to provide the requested information. Mr. Malkiewich continued testimony of the Administrative Division's budget by providing an overview for the committee of pages 10 -12 in Exhibit G. Senator Raggio asked if the inflation factors shown in decision module M-100 are the same as those reflected in the Governor's Executive Budget. Mr. Malkiewich replied as a general rule they are, but the budget does reflect where there is deviation. He said additional utility costs of $33,186 were added based on information received concerning increases in utility costs. Senator Raggio asked if there have been any noticeable savings in LCB's efficient lighting program. Mr. Malkiewich replied in the affirmative. He explained that is one of the reasons the lighting retrofit program was built into the budget. He said not only have they saved utility costs, but a rebate of about $19,000 was received from the Sierra Pacific Power Company for the lighting retrofit program. The Legislative Commission approved using the $19,000 rebate to continue using the program, and over time all inefficient lighting will be replaced. Senator Raggio asked what areas still require lighting retrofitting. David Whatley, Facilities Manager, Buildings Unit, Legislative Counsel Bureau, replied all of the space located on the first floor of the Legislative Building, and the committee rooms and hallways of the second and third floors, were targeted in the first phase of the lighting retrofit project. The bureau is now planning to continue the lighting retrofit project in the individual offices on the second and third floor to entirely complete the retrofitting project within the Legislative Building. Senator Raggio asked if the Sedway Office Building has been retrofitted. Mr. Whatley replied lighting work has not yet been accomplished in the Sedway Office Building, but the $30,000 budget appropriation for the lighting retrofit program does include the Sedway Office Building. Senator Raggio opined it would be important to complete the lighting retrofit program in the Sedway Office Building since it is in use on a daily basis. He said he is not so sure there would be an advantage to completing the project in the individual offices within the Legislative Building used primarily during sessions. He requested a break out of the costs for the lighting retrofit project to be completed in the individual offices to determine if a cost reduction can be accomplished. Senator Rawson asked if the experimental laptop computer pilot program is reflected in the budgets being reviewed today. Mr. Malkiewich answered the laptop computer pilot study will begin today (March 20, 1995) and Senators O'Donnell, Coffin, and Porter are participating. He said the costs for the pilot program were not built into the budget. He pointed out there is a separate appropriation measure before the Senate Committee on Finance that will include the LCB's information system one-shot requests. Senator Rhoads asked the cost of a typical video conference. Mr. Malkiewich replied it costs LCB about $30 an hour to conduct a video conference; while the charge to someone in the private sector is about $100 per hour. Senator Rhoads asked if an analysis has ever been made of the amount of money saved by preventing legislators from traveling back and forth from Carson City to Las Vegas. Mr. Malkiewich stated the LCB has maintained a running total of the savings in travel time, and it is well over $1 million. He stated there was recently an article in the publication Government Technology concerning the state's video conferencing system and the dramatic return on the investment that has been gained. He said now that the system is located in a state-owned building, state agencies are the major users, and between the Legislature and the Executive Branch agencies, it is believed the system will provide tremendous savings to the state. Senator Rhoads asked for a copy of the savings calculated to date. Senator Jacobsen asked for comments regarding the new Health, Safety and Personnel Officer position. To answer Senator Jacobsen's question, Mr. Malkiewich referred the committee to decision module M-200 that states the new position would have primary responsibility for compliance with federal regulations, such as those related to the Americans with Disabilities Act (ADA) and the Occupational Safety and Health Administration (OSHA). He explained the time spent complying with the ADA and rules associated with OSHA has increased dramatically, and an expert in the regulations involved will require a full- time position. Mr. Malkiewich said the other positions shown in decision module M-200 the LCB proposes to add is the continuation of three Building Maintainers. He explained since the opening of the Legislative Building in 1970 there have been modifications made in every biennium, and tremendous savings have been accomplished because the modifications are done by in-house staff. Senator Raggio inquired if there is proposed construction in the next biennium to justify the continuance of the three positions. Mr. Malkiewich replied experience has proven there is never a shortage of work for the Building Maintainers to perform. Senator Raggio asked what projects are anticipated in the next 2 years. Mr. Malkiewich responded, "Although we have planned only a few projects that can be handled with existing staff, our experience has been that every session we get more requests than our current staff can handle." Senator Raggio asked Mr. Malkiewich to provide the committee with written justification for the three positions. Senator Coffin remarked there is a bill to expand the Legislative Building, but he doubts it will ever be heard. He asked if it would be possible to perform a study to consider the expansion of the third floor into the existing air space above Room 119. He remarked this might provide additional space for the legislators and personnel located on the third floor and would utilize existing space more efficiently. Mr. Malkiewich said the bill that was introduced is to plan revenue for a Legislative Office Building in Las Vegas. He does not believe there is a bill for the expansion of the existing Carson City facility. He pointed out within the Capital Improvement Program budget there is a proposed expansion of the Carson City building. Mr. Malkiewich mentioned a few years ago when major expansion of the Legislative Building was planned, an addition to the building was considered by building over the chambers. He recalls that was the most expensive component. Senator Coffin commented since there is only air above Room 119, the high costs involved with the removal of asbestos or lead would be eliminated. He stressed the utilization of the air space would take some of the pressure off the crowded conditions on the third floor for at least a few years. Mr. Malkiewich reiterated to build over the pie-shaped area above Room 119 and the Senate and Assembly Chambers will involve high costs. He volunteered to provide Senator Coffin with information concerning building expansion studies that were conducted in the past. Mr. Malkiewich continued his coverage of pages 13 - 15 of the Administrative Division budget reflected in Exhibit G. Senator Raggio asked for comments regarding the bureau's request for $52,500 to replace a diesel storage tank in the east parking lot. Mr. Malkiewich stated the tank is old and needs replacement and is not up to industry standards. It is the desire of the bureau to replace the storage tank before it begins to leak. He pointed out due to the high water table in the area, the tank in its present condition is "a disaster waiting to happen." Mr. Malkiewich pointed out the diesel storage tank provides the fuel used throughout the Legislative Building. Mr. Whatley stated the diesel tank provides fuel for the emergency generator and the boilers that produce heating and air conditioning for the building. Senator Rawson asked if the replacement tank will be an above ground tank, and Mr. Whatley replied the tank will be placed underground due to lack of space above ground. He pointed out diesel tanks used today are constructed of double-wall fiberglass and contain an inside monitor to indicate wall failure to prevent an environmental accident. The tank currently in use is a single-wall steel tank and does not meet standards except the bureau does perform annual testing on the tank required by federal regulation. Senator Jacobsen asked the capacity of the tank and the yearly consumption of diesel fuel. Mr. Whatley replied the existing storage tank holds 10,000 gallons of fuel, and in a normal year approximately 2,000 gallons of fuel is consumed. Senator Jacobsen pointed out it does not seem reasonable to have a 10,000 gallon tank for the low volume of fuel used on a yearly basis. Mr. Whatley said the purpose of the larger volume storage tank is to enable the building to function at complete occupancy for at least a 10-day period in the event of an emergency due to the shortage of diesel fuel. Senator Jacobsen suggested a smaller size tank can be used since there is no longer danger of a shortage of diesel fuel as in the past. He pointed out a smaller tank would require a smaller excavation area and would save costs. Mr. Whatley said the suggestion of a smaller tank will be investigated. Senator Coffin noted for most Capital Improvement Projects (CIP) the cost of a diesel storage tank including underground burial is $25,000 to $35,000 depending upon the size of the tank. He said there are about 25 CIP projects going on now involving replacement of diesel storage tanks. Senator Coffin suggested the LCB may want to seek an opinion from the State Public Works Board to see if the work can be completed at a lower cost. Senator Raggio requested an estimate from the State Public Works Board for the diesel storage tank project be submitted to the committee, and inquired regarding the division's request for $15,000 to add security cameras in the first floor hallway of the Legislative Building. Mr. Malkiewich said in addition to the cameras currently being used to monitor various doors and the parking lot, there are some cameras within the Legislative Building. The division wishes to add additional security cameras to monitor as much of the building as possible in the event of problems. He pointed out the vast majority of the Legislative Building, including Hearing Room 223, is not under the scrutiny of the Legislative Police due to the lack of security cameras. Senator Raggio asked that a schematic be submitted to the committee reflecting the trail of the security cameras in use and where new security cameras will be utilized. Senator Rhoads asked if the request for additional security cameras is granted, will there be a reduction in the number of security personnel now on duty. Mr. Malkiewich stated there will be no reduction of security personnel. He emphasized additional cameras will allow the police to simultaneously monitor more of the building. He remarked during late night hours only one officer is on duty, and an enhanced security camera system will provide better coverage of the building for that individual. Senator Rawson asked if a video disk or some other device is utilized to have long- term storage of images reflected on security screens. Mr. Malkiewich replied images are not recorded. Mr. Whatley interjected to clarify images are recorded at all doorways. Senator Rawson said a device is made that takes pictures every 30 seconds and stores the information on video disk. He suggested the Legislative Building should have that capability. Mr. Malkiewich returned the committee's attention to decision module E-870 shown on pages 14 and 15 of Exhibit G for the division's Las Vegas Office, and continued his testimony. Senator Raggio asked what the rental charge is for the State Office Building in Las Vegas. Mr. Miles replied the amount is $.61 per square foot. Gary Crews, Legislative Auditor, Audit Division, Legislative Counsel Bureau, provided an overview of the Audit Division's budget reflected on pages 16 - 20 of Exhibit G. Senator Coffin noted the division wishes to replace some computers with new technology 486 computers, but stated the 486 computers will soon be superseded within the current calendar year by a new P-6 chip. He suggested the division may want to wait an additional 8 months to replace the existing computers in order to take advantage of the latest technology. Mr. Crews stated the division has to make evaluations regarding computer replacement on a day-to-day basis due to changes in technology and costs. Senator Jacobsen noted there has been some discussion during joint subcommittee meetings by members of the Assembly Committee on Ways and Means regarding the duplication of effort involved in performing some administrative audits. He asked if this would create any interference with audit activity going on within the Senate. Mr. Crews answered there is no duplication of effort going on at the current time concerning the Assembly and the Senate audit projects. He said the nature of the work being done by the Assembly is different from that being performed by the Senate. Senator Jacobsen asked if a current chart is available showing the audits performed and scheduled. Mr. Crews replied in the affirmative. He stated a 2-year audit plan was recently adopted by the Legislative Commission, and he will provide a copy of the plan to the committee. Mr. Crews pointed out decision module M-300 reflects the division's request to reclassify six of their unclassified staff, including the Legislative Auditor, the Chief Deputy Legislative Auditor, three Principal Deputy Legislative Auditors, and an Audit Secretary. He stated the request results from greater duties and responsibilities, especially in the areas of planning, data collection and analysis, and reporting required for performance audits. Senator Rawson remarked the committee will have to review a list of the salaries now being paid, and Mr. Crews stated he will provide the information immediately. Senator Jacobsen pointed out the audits performed within state agencies by the Audit Division usually point out discrepancies, but the agencies are slow to comply with suggestions made by the division. Mr. Crews stated the division has noted a better response to audit suggestions since the establishment of the Audit Subcommittee of the Legislative Commission who have supported the process. Senator Raggio pointed out the committee is made aware of the agencies who are not in compliance through the budget process. Dan Miles, Senate Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, provided testimony regarding the budget for the Fiscal Analysis Division. He referred the committee to pages 21 - 24 of Exhibit G from which his presentation was taken. Senator Coffin wished to commend the staff of the Fiscal Analysis Division for their exemplary work. He said there is only one area he believes requires improvement and that is regarding Fiscal Notes. Mr. Miles said during an interim study of the LCB the topic of Fiscal Notes was discussed on several occasions, and is one of the reasons an enhancement to the division's Program Analyst staff was suggested. Mr. Miles said in the event Fiscal Notes are not satisfactory, or the chairman of a committee in which a bill is being heard desires to revise a Fiscal Note, the division now has better staff capability to oversee the process. He pointed out state agencies still must prepare state Fiscal Notes, but the division is in a better position to review those notes that are questionable. Senator Coffin feels a position should be dedicated to the review of Fiscal Notes. He mentioned some of the Senate committees are having difficulty receiving Fiscal Notes prior to floor sessions regarding a particular bill, and the problem could be resolved by assigning one individual to the Fiscal Note process. Mr. Miles said the division will consider Senator Coffin's suggestion but explained the analysts assigned to the Fiscal Analysis Division are assigned by function and become experts on specific agency programs. This expertise enables them to examine fiscal impact statements involving their area of expertise. He pointed out state agencies are responsible for the preparation of state Fiscal Notes that are reviewed by an LCB staff member who also gathers Fiscal Note information from local governments. Senator Coffin suggested the committee may want to discuss the possibility of a specialist position to be assigned to Fiscal Note procedures to enhance the decision making process of the legislators. Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau, continued the overview for the committee by covering the budget of the Legal Division shown on pages 25 - 30 of Exhibit G. Ms. Erdoes stated due to the large amount of turnover within the division's legal staff, a great deal of time is devoted toward training new attorneys, and she feels this is inefficient. She said there are currently 18 attorneys on duty in the Legal Division, but of the 18, eight are new employees hired before the start of the current legislative session and are now being trained. Ms. Erdoes said it takes 2 to 3 years to train division attorneys, but many of them leave for positions elsewhere due to low pay and the long hours the division's staff must work. Ms. Erdoes said about two-thirds of the revenue the division has requested for the current biennium is to increase the salary levels of division attorneys and reduce overtime hours. Ms. Erdoes remarked an interim study subcommittee recommended the Legislative Commission approve the hiring of two Attorneys and three Paralegals for the division. The commission approved the recommendation and accordingly, the five positions have been included in the division's Base Budget request. She pointed out the division is also requesting a Legal Secretary to assist the additional personnel recommended by the commission, and the reclassification for 14 staff members, including one Principal Deputy Legislative Counsel and seven Deputy Legislative Counsels based on comparative position information in other state agencies. Senator Raggio asked the starting salary for the Deputy Legislative Counsel position, and Ms. Erdoes replied the starting salary is $35,687 per annum with employer-paid retirement and $38,982 per annum with employee-paid retirement. Mr. Malkiewich said the increased salary levels are comparable to the starting salary of the Deputy Attorney General position. Senator Raggio stated the committee requires an update of the salary amounts for attorney positions in all state offices such as the Office of the Attorney General, the Judicial Branch, and LCB. He asked the division to provide the basic salary information to be used for comparison purposes. Ms. Erdoes indicated the requested salary information will be furnished as soon as possible. Senator Raggio asked Ms. Erdoes to comment concerning decision module E-720 regarding the division's $20,000 request to purchase a device which will produce CD ROM disks. Ms. Erdoes replied the disks will be used to produce publications, such as the Nevada Revised Statutes, onto a CD ROM disk Additionally, Ms. Erdoes said, CD ROM disks can be used for storage of data for easier access by staff attorneys. Senator Raggio inquired regarding the status of bill draft requests received by the division. Ms. Erdoes said approximately 1,900 have been received, 1,300 drafted, and 1,200 delivered. Senator O'Donnell asked if the division's request for the device that produces CD ROM disks was reviewed by the Interim Oversight Committee. Ms. Erdoes said the request was not given to the Interim Oversight Committee because the budget for the Legal Division was prepared before the device was considered. Senator O'Donnell expressed disappointment because the request should have been reviewed by the committee. Ms. Erdoes referred the question to Mr. Malkiewich, but pointed out the conversion to Word Perfect software will be delayed until after the end of the current session. Mr. Malkiewich responded approximately $100,000 has been expended for the conversion software the division will have to utilize since the software now in use will not be adequate. He said the division could not deal with the implementation of a new computer program just before the start of the legislative session, but the conversion process will take place in the interim period. He reminded the committee the division paid for the conversion to the WordPerfect software out of savings from the Legal and Administrative Division budgets. Robert E. Erickson, Research Director, Research Division, Legislative Counsel Bureau, provided testimony regarding the Research Division budget by reading from prepared testimony (Exhibit I) and referencing pages 30 - 36 of Exhibit G. Referring to the division's request to continue funding two Senior Research Analyst positions that were supported from funds collected from other sources in prior years, Senator Raggio asked what the additional cost will be to the General Fund. Mr. Erickson responded the biennial cost for the two positions will be $228,618. Senator Raggio asked if revenue from the Committee on High-Level Radioactive Waste is still available, and Mr. Erickson answered as far as he knows there have been no changes in the availability of the revenue that amounts to $12,000 annually. Mr. Erickson remarked the $12,000 annual transfer to the Research Division is to reimburse the division for office space and supplies provided to the staff of the Committee on High-Level Radioactive Waste. Senator Raggio asked Mr. Malkiewich if vacancy savings are built into the division's budget. Mr. Malkiewich replied vacancy savings were not built into the budget. He remarked: "No, we have not deducted for the fact that we are going to end up underfilling some of the positions with the turnover." Senator Raggio recalled that vacancy savings are built into all budgets with 10 or more positions. He suggested the division look into this. Senator Rawson pointed out there are a number of conferences that will be coming up regarding health care and welfare reform issues. He reminded the division to consider the revenue that will be needed for travel to attend the conferences. He also asked if it would be worthwhile to have a color copier located in the Legislative Building. Fred W. Welden, Chief Deputy Research Director, Research Division, Legislative Counsel Bureau, replied when the division considered the changes that would take place to continue funding the two Senior Research Analysts, revenue was included in the Base Budget for their travel consistent with other research staff. In reference to Senator Rawson's inquiry concerning a color copier, Mr. Malkiewich responded there is no color copier presently located in the Legislative Building and although they have looked into the possibility of acquiring one, the need does not exist to purchase this item. Nevada Legislature Interim - Page 161 Janice L. Thomas, Secretary of the Senate, Legislative Counsel Bureau, introduced Mouryne B. Landing, Chief Clerk of the Assembly. Her written testimony, Exhibit J, was read for the record and includes a detailed job description for the requested position of Administrative Assistant. A copy of Exhibit J was distributed to the members of the committee. Senator O'Donnell wished to compliment Ms. Thomas and Ms. Landing and remarked, "I think these are two of the finest secretaries we have ever had." Senator Raggio introduced Bill Draft Request (BDR) 23-794 and Bill Draft Request (BDR) 23-797. BILL DRAFT REQUEST 23-794: Revises provisions governing eligibility of certain gaming control agents for early retirement. BILL DRAFT REQUEST 23-797: Revises provisions governing eligibility of certain dispatchers for early retirement. Senator Raggio recalled comprehensive studies that were made regarding the employee groups that can be considered for early retirement. He stated the BDRs introduced today are a departure from the early studies, and asked for input to determine if they should be entertained. Dennis J. Healy, Attorney at Law, Law Offices of Walter R. Tarantino, pointed out the principal duties of certain dispatchers and gaming control agents require emotional and physical capacity in protecting the public and enforcing the laws of the State of Nevada. He explained the agents referenced by BDR 23-794 are the enforcement agents that are the policemen for the State Gaming Control Board, and fulfill all of the requirements considered when a peace officer position is rated. Mr. Healy said gaming control agents are often involved in extremely volatile situations, including extradition efforts. He pointed out the principal duties of both the dispatchers and gaming control agents require emotional and physical capacity in protecting the public and enforcing the laws of the State of Nevada. Senator Raggio reiterated for many years the issue of early retirement has been under close scrutiny for many units of state employment, including peace officers. At the present time, all peace officers in the State of Nevada are not eligible for early retirement, Senator Raggio clarified. He recalled serving on the Interim Retirement Committee that conducted an extensive study associated with peace officer positions in general, and it was determined early retirement could not be considered for many reasons, including the cost to the state to contribute to an early retirement program. He remarked requests by groups other than peace officers for early retirement have also been rejected due to the cost factor involved. In conclusion, Senator Raggio said he does not see a reason to depart from studies and recommendations made within the last 4 - 6 years by the Legislature regarding early retirement. After obtaining committee concurrence, Senator Raggio dismissed further discussion concerning BDR 23-797 and BDR 23-794. He suggested Mr. Healy may wish to revisit the studies that have been made concerning early retirement issues, and if the dispatchers and agents were somehow overlooked the committee would welcome discussion at a later date. Senator Raggio asked for action to be taken on the bills previously heard. SENATOR O'DONNELL MOVED TO DO PASS S.B. 197. SENATOR RAWSON SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * SENATOR RAWSON MOVED TO DO PASS S.B. 207. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * SENATOR O'DONNELL MOVED TO DO PASS S.B. 201. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 202 AS AMENDED. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio adjourned the meeting at 10:55 a.m. RESPECTFULLY SUBMITTED: Marion Entrekin, Committee Secretary APPROVED BY: Senator William J. Raggio, Chairman DATE: Senate Committee on Finance March 20, 1995 Page