MINUTES OF THE SENATE COMMITTEE ON FINANCE Sixty-eighth Session May 15, 1995 The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:00 a.m., on Monday, May 15, 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 GUEST LEGISLATORS PRESENT: Assemblywoman Gene Wines Segerblom, Clark County Assembly District 22 Senator Jon C. Porter, Clark County Senatorial District 1 STAFF MEMBERS PRESENT: Dan Miles, Fiscal Analyst Bob Guernsey, Principal Deputy Fiscal Analyst Jeanne L. Botts, Program Analyst Brian M. Burke, Program Analyst Marion Entrekin, Committee Secretary OTHERS PRESENT: Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau Andria Daley, Chairman, Comstock Historic District Commission, Office of Historic Preservation, Department of Museums, Library and Arts Ronald M. James, Administrator, Office of Historic Preservation, Department of Museums, Library and Arts Christine Fey, Assistant Planner, City of Reno Kirk Robertson, Churchill County Arts Council Doug Dickerson, Lobbyist, City of Las Vegas Anthony Veerkamp, Field Representative, Western Regional Office, National Trust For Historic Preservation Peter G. Morros, Director, State Department of Conservation and Natural Resources Roy W. Trenoweth, State Forester Firewarden, Division of Forestry, State Department of Conservation and Natural Resources Robert J. Gagnier, Executive Director, State of Nevada Employees Association John P. Comeaux, Director, Department of Administration Howard Barrett, Interested Citizen Don Hataway, Chief Assistant Budget Administrator, Budget Division, Department of Administration Senator Raggio asked for introduction of the following bill draft request (BDR). BILL DRAFT REQUEST 39-2061: Revises provisions governing allocation of money from community training center account. SENATOR JACOBSEN MOVED TO INTRODUCE BDR 39-2061. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR COFFIN WAS ABSENT FOR THE VOTE.) * * * * * Senator Raggio opened the hearing for discussion of Assembly Bill (A.B.) 80 out of agenda order to accommodate the schedule of Assemblywoman Gene Wines Segerblom and Senator Jon C. Porter. ASSEMBLY BILL 80: Revises provisions governing certain grants of financial assistance made by commission for cultural affairs. Assemblywoman Gene Wines Segerblom, Clark County Assembly District 22, testified in support of the passage of A.B. 80 that seeks an appropriation of $20 million over a 10-year period to be used for historic preservation. Mrs. Segerblom indicated the appropriation will be granted at the rate of $2 million per year for 10 years, and in no case may the amount to be granted exceed $2 million per year. Mrs. Segerblom referred the committee to Exhibit C, a list of historic sites that were approved funding in 1993. She said additional applications for historic preservation had to be denied due to lack of funding. Brenda J. Erdoes, Legislative Counsel, Legal Division, Legislative Counsel Bureau, testified A.B. 80 is similar to a bill passed in 1991 for historic preservation except A.B. 80 includes a $2 million per year limitation not specified in the earlier bill. Ms. Erdoes pointed out the 1991 version of A.B. 80 also stipulated the general obligation bonds of the State of Nevada would be exempt from the debt limitation because "they were cultural resources." Senator Raggio asked if the bill is passed and $20 million is authorized to be used at the rate of $2 million per year for 10 years, how much is chargeable against general obligation bond limitations. He also asked if there will be an impact on the bond rate debt service. In response to the first part of Senator Raggio`s inquiry, Ms. Erdoes said A.B. 80 stipulates that no public debt is created, within the meaning of section 3 of article 9 of the Constitution of the State of Nevada (which is the debt limitation) until the issuance of the bonds. Upon passage of A.B. 80, Ms. Erdoes said only $2 million each year can be counted against the debt limitation and not the $20 million. Senator Raggio pointed out there will be a $20 million obligation over a 10-year period that would have a practical effect upon any future bonds that are issued, and this would have to be considered any time a bond is issued in the next decade. Ms. Erdoes concurred with Senator Raggio`s remark. Senator Rawson inquired if the purpose of A.B. 80 is to place a spending limitation on the $20 million appropriation of $2 million per year. Mrs. Segerblom replied, "Yes." Andria Daley, Chairman, Comstock Historic District Commission, Office of Historic Preservation, Department of Museums, Library and Arts, testified in favor of the passage of A.B. 80. Senator Raggio asked who makes the determination regarding the projects to be considered for historic preservation. Ronald M. James, Administrator, Office of Historic Preservation, Department of Museums, Library and Arts, said legislation passed in 1993 authorized the five-member Commission for Cultural Affairs to review grant applications, and make the final determination for awarding the funds required for historic preservation projects. Referring to Exhibit C, Senator Raggio noted in 1993 funding of $2.5 million was authorized for 18 approved projects. He asked how many applicants there were altogether. Mr. James responded the commission reviewed 31 applications for a total of $13.5 million requested, and reduced the amount to $2.5 million for the listed projects (Exhibit C). Senator Raggio asked if the commission has a proposed list of applicants to utilize the $4 million that will be available (in the biennium) if A.B. 80 is approved. He stated a list would be helpful to the committee to identify the types and locations of projections to be considered. Mr. James responded, "No. If the commission were to come up with a list, it would give the impression to applicants that did not previously apply there is an inside track." Mr. James said many of the projects for which funds were requested in 1993 were too large for consideration, and had to be rejected by the commission. He opined new applications will be received from these applicants, and from some of the 18 project applicants listed (Exhibit C). Senator Raggio requested a list of the applicants that were rejected for funding in 1993. Mr. James agreed to submit the requested information for the committee's review. Senator Jacobsen requested a status report for the projects that were approved funding, and to indicate the projects for which Honor Camp crews were utilized. Mr. James agreed to submit a status report and said many of the projects have been completed or will anticipate a completion date in the summer of 1995. He will also advise the committee regarding the utilization of Honor Camp crews. Christine Fey, Assistant Planner, City of Reno, said the City of Reno supports the passage of A.B. 80. She testified the City of Reno was a recipient of $200,000 in 1993 for preservation work at the McKinley Park School, and the city will submit another application for additional funding since the total project cost for restoration of the McKinley Park School is $1.69 million. She stated the McKinley Park School is the city's recreation center, and over 1,000 people go through the school on a weekly basis for classes and other program activities. Ms. Fey opined the school is an important cultural resource for the City of Reno that should be refurbished, and programs endorsed by the Commission for Cultural Affairs will enable Nevada communities to preserve and develop Nevada's cultural resources for future generations. Kirk Robertson, Churchill County Arts Council, stated the council was also a recipient of a grant from the Commission for Cultural Affairs. He testified in support of the passage of A.B. 80 by reading from prepared testimony (Exhibit D). Senator Jon C. Porter, Clark County Senatorial District 1, testified in behalf of the community of Boulder City, Nevada that supports the passage of A.B. 80. Boulder City takes pride in being the home of the Boulder Dam Hotel and its preservation, Senator Porter indicated, since the hotel is a major part of southern Nevada's heritage. Doug Dickerson, Lobbyist, City of Las Vegas, referenced Exhibit E, a memorandum from the Las Vegas Historic Preservation Commission, expressing their support of the passage of A.B. 80. Anthony Veerkamp, Field Representative, Western Regional Office, National Trust for Historic Preservation, remarked the trust is supportive of the passage of A.B. 80 due to the need for financial incentives for individuals to preserve their cultural legacy. Mr. Veerkamp believes the 10-year span of the bill is very important. He explained many of Nevada's communities do not have access to resources, or know how to plan the use of available resources. Senator Raggio closed discussion on A.B. 80 and opened the hearing for discussion of Senate Bill (S.B.) 76. SENATE BILL 76: Authorizes temporary advance from state general fund for authorized expenses of state department of conservation and natural resources. Peter G. Morros, Director, State Department of Conservation and Natural Resources, testified S.B. 76 will permit the director of the department to request a temporary advance from the state General Fund in order to pay claims when reimbursements for expenses incurred in fighting fires have been billed, but not yet received from federal, state, or local governments. He provided the committee with Exhibit F, a list of the department's outstanding suppression billings, and pointed out $750,038.40 is still owed the department, mostly from the federal government. Mr. Morros said once approved by the director of the department, the advances are limited to 25 percent of the amount of outstanding billings to governmental agencies for fire-fighting expenses. The language reflected in lines 18, 19, and 20 of S.B. 76 is not clear regarding the 25 percent limitation, Mr. Morros said. He recommended section 1 (3) (b), starting on line 18, be amended to read: "Is limited to 25 percent of the revenue [budgeted] to be received by the Division of Forestry in the current fiscal year [from any source other than legislative appropriation] for billings for fire suppression activities from other governmental agencies." Senator Raggio noted an outstanding billing to the United States (U.S.) Bureau of Land Management dating back to October 25, 1994. He indicated his reluctance to advance General Fund revenue that might not be paid back to the state. Mr. Morros said although there are long delays, the department has always received payment from the federal agencies in the past, and is confident the outstanding amounts will ultimately be satisfied since there are no disputed billings involved. He reminded the committee the complexities of the fire season for the federal agencies involved cover the entire U.S., and their resources get strained to the maximum in an effort to keep up with the costs incurred during an active fire season. Senator Raggio pointed out the Union and Southern Pacific railroads have outstanding billings totaling $13,392.40, and asked why the railroads do not satisfy their outstanding bills in a timely manner. Roy W. Trenoweth, State Forester Firewarden, Division of Forestry, State Department of Conservation and Natural Resources, replied it is normal for the railroads to take a long time to satisfy the payment of bills because of the time it takes them to investigate the reason for the billing and to determine the railroad line involved. Jeanne L. Botts, Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, said General Fund advances may only be provided to the budget account from which fire suppression costs are paid. The Division of Forestry has requested that account, the Forest Fire Suppression budget account, be renamed by the passage of S.B. 76 to the "Emergency Response" account since the agency's responses include all emergencies, not just fires, and mostly involve medical emergencies. Senator Raggio closed discussion on S.B. 76 and opened the hearing for discussion of Senate Bill (S.B.) 301. SENATE BILL 301: Establishes for next biennium amount to be paid by state for group insurance for state employees and their dependents. Robert J. Gagnier, Executive Director, State of Nevada Employees Association, provided testimony in support of the passage of S.B. 301 by reading from prepared text (Exhibit G). He also provided a handout to the committee (Exhibit H) reflecting changes to conform to reduced employee-contribution costs for those who elect to participate in the state's group health insurance program. Senator Raggio asked if the $284 employee (monthly) cost of premium reflected in section 1 (1) for Fiscal Year 1995-1996 will be changed to $237 for those employees who do not choose dependent coverage, and the $359 per month for employees who choose dependent coverage will be changed to $312. Mr. Gagnier replied, "That is correct." Senator Rawson asked if legislators will be affected by the passage of S.B. 301. Mr. Gagnier replied legislators are eligible for coverage, but will be required to pay their own contribution. Mr. Gagnier said the passage of S.B. 301 will provide an incentive to employees who could not afford to pay the required premiums in the past to elect health insurance coverage for their dependents. Senator Raggio asked the Department of Administration's opinion of S.B. 301. John P. Comeaux, Director, Department of Administration, said the department has not taken a position regarding S.B. 301, but the additional costs referenced by Mr. Gagnier ( Exhibit G) are not included in the Executive Budget. Mr. Comeaux said when information regarding the change in costs made by the administration's actuary was shared with the committee, he recommended the contributions by the state be reduced to the amount necessary to cover increased costs. Senator Raggio noted the approximately $12.5 million additional cost of paying dependent premiums will be offset by a reduction of approximately $7 million. He asked the amount of the reduced contribution by the state that is reflected in the Executive Budget. Mr. Comeaux responded the total reduction for active employee group insurance over the biennium is $7,685,000. He further stated he will provide detailed information to the committee concerning the Department of Administration's position concerning S.B. 301. Howard Barrett, Interested Citizen, stated he supports the concept of S.B. 301 that provides for dependent coverage, but wants the bill to also indicate state funds can be used for dependent coverage. Senator Raggio indicated S.B. 301 specifies the amount of the contribution to be paid for employees who do not choose to cover dependents as well as a higher amount for those who choose to have dependent coverage. Mr. Barrett restated, "I want dependent coverage mentioned in the bill that the state's money can be used to cover dependent coverage. Dependents are not mentioned in the bill's present format." Senator Raggio qualified that S.B. 301 contains a commitment by the state to pay a specific amount for the employee and another specific amount for those who desire to cover dependents. Senator Coffin opined to be equitable the law should be changed to allow those individuals, particularly officers of the state, who do not have dependent coverage and pay their own premiums to pay the actuarial determined single employee cost. Senator Raggio closed the hearing on S.B. 301 and opened the hearing for discussion of Senate Bill (S.B.) 425. SENATE BILL 425: Makes various changes in accounting practices regarding certain public money. Don Hataway, Chief Assistant Budget Administrator, Budget Division, Department of Administration, provided a background of the proposals contained in S.B. 425 which will provide for the Department of Administration's operating fund for general services to be created as an internal service fund, and to accrue a proportionate share of the benefits of interest earned from operating funds of the Buildings and Grounds Division, Purchasing Division, State Printing and Micrographics Division, Motor Pool Division, and the Department of Personnel. Mr. Hataway stated S.B. 425 is related to the Statewide Cost Allocation Plan process. He explained the state must operate according to rules and regulations contained in Circular A-87 of the U.S. Office of Management and Budget (OMB). This circular outlines the procedure that must be followed for acceptance by the OMB of the state's Cost Allocation Plans. Mr. Hataway pointed out the OMB is now placing more emphasis on the amount of retained earnings contained in agency fund accounts, and are only willing to participate in a certain amount usually not to exceed a 60-day retained earnings period. He remarked: In the calculations we work with the feds [federal government] on for retained earnings, we have to include what the agency fund would have accrued if they were earning interest directly to those accounts. S.B. 425 puts into law what we (the state) have done to show in our interest calculations what the interest would have been. According to Mr. Hataway a negative aspect of S.B. 425 is the General Fund will lose the interest that would have been earned in the various agency fund accounts. He stated: If you do not pass S.B. 425, it will make not make any difference as far as us (the Budget Division) meeting the rules of the federal government. We are going to have to go through the calculation process anyway. We will use what we feel is the best interest rate earned for that particular year, calculate it into the retained earnings, show them that we are not being over protective for these funds in terms of their retained earnings.....It would help, obviously, if they were receiving it directly. We could then say Buildings and Grounds [Division] received specifically this amount, printing received this amount, but it is no great problem. If you do not pass the bill we are going to make that calculation anyway. That is why I am here as a neutral giving you the background on it. The only account that is not specifically a part of the Statewide Cost Allocation is reflected in section 8 of S.B. 425, Mr Hataway said, that deals with the Rural Housing Authority's housing fund. The Office of the State Controller stated the housing fund is an enterprise fund like the other accounts involved and for uniformity purposes, should be included. The Housing Authority currently maintains the bank account for the housing fund as a separate account that is not placed in the General Fund. He pointed out for purposes of his testimony relating to the Statewide Cost Allocation Plan, section 8 is not applicable. Senator Raggio asked if S.B. 425 is supported by the state controller. Mr. Hataway responded in the affirmative. He said S.B. 425 was submitted by the state controller after discussion with federal representatives regarding the calculation of retained earnings. The Office of the State Controller feels it would be more practical to have the funds go directly to the accounts, and the General Fund and non-General Fund agencies could then accrue benefits from rate reductions the funds will produce. If S.B. 425 is passed, Senator O'Donnell asked if the accounting method used to calculate and disperse interest to the various agencies will result in an easier or more difficult process. Mr. Hataway replied it is his understanding at the end of each quarter the interest earned will be prorated to the entities that are the recipients of the interest based upon the percentage balance of the assets of the state at the time. If the General Fund represents 75 percent of the balance available, the entities would receive 75 percent of the interest that was earned for that particular period. Senator Raggio closed the hearing on S.B. 425. Information Services - Director's Office - Page 609 Brian M. Burke, Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, highlighted the budget closing actions recommended by the Joint Subcommittee on General Government of the Department of Information Services by reading from prepared text (Exhibit I) and referencing page 1 of the budget closing action sheet (Exhibit J). Senator Raggio asked if the Joint Subcommittee on General Government approved the statutory reorganization within the Department of Information Services (DIS). Mr. Burke replied Assembly Bill (A.B.) 200 proposes to merge several organizations. The joint subcommittee did approve the merger of the Communications, Telecommunications, and the Facility Management Divisions, and Mr. Burke said the merger action is reflected in the closing sheets (Exhibit J). ASSEMBLY BILL 200: Revises provisions governing organizations of department of information services and administration of state communications system. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS REFLECTED ON PAGE 1 OF EXHIBIT J. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR COFFIN WAS ABSENT FOR THE VOTE.) * * * * * Information Services - Research and Planning Division - Page 615 Mr. Burke summarized the closing action recommendations of the Joint Subcommittee on General Government by reading from prepared text (Exhibit I) and highlighting pages 2 and 3 of Exhibit J. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS REFLECTED ON PAGES 2 AND 3 OF EXHIBIT J. SENATOR MATHEWS SECONDED THE MOTION. Senator Raggio reminded the committee although the subcommittee supports merging the Research and Planning Division with the Systems and Programming Division to improve management of the agencies and enhance customer service, the subcommittee recommended maintaining separate budget accounts for cost tracking purposes. THE MOTION CARRIED. (SENATOR COFFIN WAS ABSENT FOR THE VOTE.) * * * * * Information Services - Systems and Programming Division - Page 621 Mr. Burke directed the committee's attention to the budget closing action items shown on pages 5 - 7 of Exhibit J and provided verbal testimony from Exhibit I. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE JOINT SUBCOMMITTEE RECOMMENDATIONS REFLECTED IN EXHIBIT J, PAGES 5 - 7. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Information Services - Facility Management Division - Page 631 Reading from Exhibit I, Mr. Burke highlighted the significant budget closing actions recommended by the Joint Subcommittee on General Government as listed in items 1 - 13 on pages 9 and 10 of Exhibit J. Mr. Burke noted the subcommittee concurred with the funding recommended in decision module E-125 of $506,800 in communications equipment to expand the state's data communications network and connect existing state facilities through the state's communication hubs. Senator Rawson asked if the expanded communications networking has been coordinated with education or higher education. Mr. Burke responded by statute the State Department of Education and the University and Community College System of Nevada (UCCSN) are exempted from using services provided by the DIS. Senator Rawson asked if teleconferencing capability will be included. Mr. Burke replied in the affirmative. Senator Rawson stated even though the UCCSN and State Department of Education are exempted from services provided by the DIS, the state will save resources if education and higher education are included in the communication services provided by the DIS. He suggested a committee should be appointed to perform a study to determine if some kind of compatibility can be achieved. He stated he would like to have the Legislative Counsel Bureau involved in the study. Mr. Burke stated a Letter of Intent can be prepared to recommend inclusion of the State Department of Education and the UCCSN in the DIS Communications Network System. Senator Raggio agreed with Senator Rawson `s suggestion, and asked Mr. Burke to prepare the Letter of Intent in draft form for the committee's approval. He said it would be in the state's best interest to have a centralized state Communications Network System to include all of the departments and agencies within state government. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS REFLECTED ON PAGES 9 AND 10 OF EXHIBIT J. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR COFFIN WAS ABSENT FOR THE VOTE.) * * * * * Information Services - Telecommunications Division - Page 641 Mr. Burke stated the Governor's Executive Budget recommended one new Communications Specialist position to improve processing of requests for telephone moves, additions, and changes requested by customer agencies. The joint subcommittee recommended denial of the request since the agency was not able to provide definitive caseload statistics to support an increase in staffing. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 12 OF THE BUDGET ACTION SHEET (EXHIBIT J). SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR COFFIN WAS ABSENT FOR THE VOTE.) * * * * * Mr. Burke stated the Joint Subcommittee on General Government completed the review of the budgets of the Department of Employment, Training and Rehabilitation (DETR) and have concurred in the closing actions recommended. ETR Directors Office - Page 1361 Mr. Burke said the Director's Office of the DETR was created through Interim Finance Committee (IFC) action on March 24, 1994. The joint subcommittee concurred with the Governor's recommendation to expand the office from 4 to 11 positions through the transfer of existing staff from the Employment Security Division and the Rehabilitation Division to enhance agency oversight by the Director's Office. Referring to page 1 of the budget closing action sheet (Exhibit L), Mr. Burke said technical adjustments are also recommended to fully fund the attorney general salary reimbursement costs equivalent to 2.25 full-time equivalent (FTE) staff Senator Raggio asked Mr. Comeaux if he is familiar with the aforementioned recommendations. Mr. Comeaux replied in the affirmative. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * DETR Administrative Services - Page 1367 Mr. Burke highlighted the budget closing action recommended by the joint subcommittee by reading from prepared text (Exhibit K) and referencing page 2 of the budget closing action sheet (Exhibit L). Mr. Burke said revenue for the Administrative Services Division will be generated through assessments to DETR agencies determined on the basis of FTE position counts. He pointed out there are a number of DETR agencies impacted by cost allocations that will require technical adjustments. Senator Raggio asked if the reductions in the cost allocations are the amounts in each year of the biennium that accommodate the lower number of positions. Mr. Burke responded the salary savings have been incorporated to reflect the average cost of six positions for a 9-month period. Senator Raggio asked why positions are not reflected in the DETR Administrative Services budget account. Mr. Comeaux responded the positions are in the base budgets of the particular account from which the positions will be transferred, and if the transfers are approved, the positions will be reflected in the DETR Administrative Services account. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS SHOWN ON PAGE 2 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * DETR Information and Development Processing - Page 1373 Reading from Exhibit K, Mr. Burke noted the significant budget closing actions recommended by the joint subcommittee as indicated on page 3 of Exhibit L. He stated the joint subcommittee concurred with the proposal reflected in the Governor's Executive Budget to create an Information Development Processing Division. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE LISTED ON PAGE 3 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * State Occupational Information Coordinating Committee - Page 1381 Mr. Burke indicated the joint subcommittee concurred with the recommended merger of the State Occupational Information Coordinating Committee with the new Information, Development and Processing Division, and technical adjustments shown on page 4 of Exhibit L are necessary to correctly classify cost allocation payments. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 4 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * State Job Training Office - Page 1387 Mr. Burke stated the agency indicated staff will be transferred from non-state owned buildings to state-owned space effective July 1, 1995. Savings are reflected in the adjusted base for this budget account. The joint subcommittee recommended reducing equipment purchases in decision module E-710. Mr. Burke pointed out the Governor's request duplicated equipment approved for purchase by the IFC during Fiscal Year 1994 - 1995. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 5 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Office of Equal Rights - Page 1395 Equal Employment Opportunity - Page 1401 Mr. Burke recommended the committee consider a joint budget closing action for the above referenced accounts. He explained the Office of Equal Rights and Equal Employment Opportunity budgets have traditionally been separated. The Office of Equal Rights is funded by the state's General Fund while Equal Employment Opportunity has been funded entirely from federal reimbursement revenue related to complaint closures. The Governor recommended a General Fund loan of $240,981 to the Equal Employment Opportunity budget to solve cash flow problems associated with delays in federal reimbursement for closed cases. The joint subcommittee recommended merging the two budget accounts thereby eliminating the need for the General Fund loan. Mr. Burke summarized the closing action recommendations of the joint subcommittee from prepared testimony (Exhibit K) and from pages 6 - 9 of Exhibit L. Senator Raggio asked if merging the two budget accounts will cause an impact on the federal reimbursement revenue. Mr. Burke responded the merger of the accounts will not affect the disbursement of federal reimbursement revenue. SENATOR MATHEWS MOVED TO CLOSE THE AFOREMENTIONED BUDGETS IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGES 6 - 9 OF EXHIBIT L. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Community Services - Page 1407 The subcommittee recommended restoration of the Americorps grant revenue and expenditure authority to the Fiscal Year 1993 - 1994 actual level of $276,000. The Governor's Executive Budget inadvertently omitted the grant amount. Senator Raggio pointed out the federal grants, such as the Americorps grant, are in question in the U.S. Congress. He asked if the three positions reflected in the budget account will be affected by the continuation of federal grant revenue. Mr. Burke believes a portion of the revenue provided to support the positions is derived from a federal grant appropriation of $133,000. Senator Raggio noted no General Fund revenue is appropriated to the budget account. Mr. Burke confirmed the state match portion is from gifts, grants, and donations and no General Fund revenue is included. The positions are dependent upon the continuation of federal grants, Mr. Burke said. The Americorps grant is used primarily for program costs. He explained there is an administrative portion of federal funding provided through the National Commission for Community Services as well as the Americorps grant. Senator Coffin asked if the Americorps grants have survived the new budgets proposed in the U.S. Congress and Senate. Senator Raggio stated there has not been a determination made, but it is one of the grants proposed to be cut. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS REFLECTED ON PAGE 10 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Employment Security - Page 1413 Mr. Burke continued his verbal testimony from Exhibit K of the important budget closing action items listed on page 12 of Exhibit L. He pointed out the joint subcommittee does not support payments to the Department of Taxation to continue a Combined Audit Program, and recommended the $12,595 per year intended for this purpose be removed from the budget. Senator Raggio said a pilot audit program under the direction of the Department of Taxation has been proposed to determine if the Combined Audit Program should continue. He pointed out audit experiments conducted under the Combined Audit Program in the past turned out to be troublesome and extremely costly to the state. The Employment Security Division's (ESD) budget includes an appropriation for the Combined Audit Program, and for this reason, he wants this budget held to afford him the opportunity to review the conditions of the Combined Audit Program. Claimant Employment Program - Page 1425 Mr. Burke directed the committee's attention to the budget closing action items reflected on page 13 of Exhibit L and provided verbal testimony from Exhibit K. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFERENCED ON PAGE 13 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Employment Security Special Fund - Page 1433 The subcommittee recommended elimination of the funding requested in decision module E-710 for the Disk Access Storage Device since the ESD consolidation with the DIS abolished the need for this equipment, Mr. Burke said. Mr. Burke said the Governor's Executive Budget eliminated private counsel for the ESD and replaced it with attorney general support centralized in the DETR. Subsequent to the submittal of the Governor's budget, the agency requested outside legal representation be retained and that the $100,143 annual cost be funded through the ESD special fund. The joint subcommittee recommended denial of the agency's request, Mr. Burke said. Senator Raggio asked if the joint subcommittee has been fully apprised of the agency's position regarding legal counsel. Mr. Burke said the agency testified at the closing hearing regarding this issue, and still wishes to retain outside legal representation. Senator Raggio requested this budget be held pending further investigation regarding the matter of legal representation. Committee to Hire Handicapped - Page 1437 Senator Raggio noted this budget is currently referred to as the Governor's Committee on Employment of People With Disabilities. Mr. Burke provided testimony from written text (Exhibit K) and referenced page 16 of Exhibit L. He pointed out Mr. Comeaux recommended the budget account be transferred from the DETR to the Department of Business and Industry where the goals of the Americans with Disabilities Act (ADA) can be better accomplished. The joint subcommittee concurred with Mr. Comeaux's recommendation, Mr. Burke stated. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 16 OF EXHIBIT L. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR O'DONNELL WAS ABSENT FOR THE VOTE.) * * * * * Employment, Training & Rehabilitation Administration - Page 1443 Mr. Burke said the joint subcommittee recommended technical adjustments to accurately reflect anticipated cost allocation expenditures. The joint subcommittee concurred with the Governor's recommendation in decision module E-500 for an intermittent Public Service intern. The agency indicated services provided to minority groups are not presently at parity, and the intern will access client and demographic records in order to perform studies for the improvement of outreach activities to minority group members. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE AS REFERENCED ON PAGE 17 OF EXHIBIT L. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR O'DONNELL WAS ABSENT FOR THE VOTE.) * * * * * Alcoholism & Drug Rehabilitation - Page 1451 Mr. Burke stated the joint subcommittee recommended holding this budget pending further consideration. Alcohol Tax Program - Page 1459 Mr. Burke stated the joint subcommittee recommended closing this account as recommended by the Governor. Senator Rawson stated there have been some questions regarding the Alcoholism and Drug Rehabilitation budget account reflected on page 1455 of the Executive Budget pertaining to welfare reform. He stated the committee may need to supplement the account by adjustments within the Alcohol Tax Program budget account. He recommended holding action on this budget account pending further review. Senator Raggio concurred with Senator Rawson's request to hold the Alcohol Tax Program budget. Drug Commission - Page 1461 The joint subcommittee recommended holding this budget pending further consideration. Vocational Rehabilitation - Page 1467 Mr. Burke referred to the budget closing action sheet on page 19 of Exhibit L and read from prepared testimony (Exhibit K). SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 19 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Services to the Blind - Page 1477 Mr. Burke stated the technical adjustments reflected on page 20 of Exhibit L were made to accurately reflect the division's cost allocation payments. The joint subcommittee concurred with the recommendation in decision module M-515 to add a new Orientation and Mobility Instructor position to alleviate the current caseload backlog. Senator Raggio pointed out his law firm represents a client who is in litigation involving the Bureau of Services to the Blind. He will abstain from voting on this budget account. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 20 OF EXHIBIT L. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR RAGGIO ABSTAINED FROM THE VOTE.) * * * * * Blind Business Enterprise Program - Page 1487 For the same reason noted in the aforementioned budget account, Senator Raggio will abstain from voting on this account. Mr. Burke said recommended technical adjustments to the program's cost allocations are reflected on page 21 of Exhibit L. The joint subcommittee recommended restoring the amounts requested in decision module E-850 for new projects to the Reserve category. It is recommended the agency can approach the IFC for a revision to the work program authority when the projects are better defined. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 21 OF EXHIBIT L. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR RAGGIO ABSTAINED FROM THE VOTE.) * * * * * Social Security Administration - Vocational Rehabilitation - Page 1495 While reading from Exhibit K, Mr. Burke highlighted the significant budget closing actions recommended by the joint subcommittee reflected on page 22 of Exhibit L. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 22 OF EXHIBIT L. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Disability Adjudication - Page 1503 Mr. Burke's comments regarding the recommended technical adjustments shown on page 23 of Exhibit L were read from prepared text (Exhibit K). SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 23 OF EXHIBIT L. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Developmental Disabilities - Page 1511 Mr. Burke said the joint subcommittee recommended technical adjustments only, including a state-owned building rent increase and cost allocation modifications. Senator Raggio asked what the significance of Senate Bill (S.B.) 216 will be on this budget account. SENATE BILL 216: Makes appropriation to department of employment, training and rehabilitation for developmental disabilities program. Mr. Burke responded S.B. 216 appropriates $227,427 to the DETR to support their housing initiatives. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET IN ACCORDANCE WITH THE RECOMMENDATIONS OF THE JOINT SUBCOMMITTEE REFLECTED ON PAGE 24 OF EXHIBIT L. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Financial Assistance for Physically Disabled - Page 1517 Mr. Burke indicated the joint subcommittee concurred with the Governor's recommended budget. SENATOR O'DONNELL MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY THE GOVERNOR. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Traumatic Head Injury Program - PAGE 1519 The joint subcommittee concurred with the Governor's recommended budget. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY THE GOVERNOR. SENATOR RHOADS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Hearing Devices Program - Page 1523 Mr. Burke said the subcommittee concurred with the Governor's recommended budget. SENATOR MATHEWS MOVED TO CLOSE THE BUDGET AS RECOMMENDED BY THE GOVERNOR. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Community Based Services - Page 1527 Mr. Burke said the Governor's budget reflected a $6,000 increase in Fiscal Year 1995 - 1996 and the joint subcommittee recommended equally splitting the appropriation between Fiscal Year 1995-1996 and Fiscal Year 1996-1997. The recommended technical adjustments for this account are reflected on page 28 of Exhibit L. Senator Raggio noted a bill may be introduced regarding the American Sign Language Program that will impact upon this budget account. He requested the budget be held pending review of the proposed bill draft request. Senator Raggio opened the hearing for a vote on S.B. 76 heard earlier today. He stated if the committee concurs, there should be a motion for an amendment to S.B. 76 to change the language reflected on page 1, lines 18 - 20, limiting the revenue to be received by the Division of Forestry to 25 percent for billings for fire suppression from other governmental agencies. He asked Ms. Botts if the amendment should include renaming the Fire Suppression budget account to Emergency Response. Ms. Botts said the name change can be included in the amendment. SENATOR JACOBSEN MOVED TO AMEND AND DO PASS S.B. 76 TO CHANGE THE WORDING ON LINES 18 - 20 TO LIMIT THE REVENUE RECEIVED BY THE DIVISION OF FORESTRY TO 25 PERCENT FOR BILLINGS FOR FIRE SUPPRESSION ACTIVITIES FROM OTHER GOVERNMENTAL AGENCIES, AND TO RENAME THE FIRE SUPPRESSION BUDGET ACCOUNT TO EMERGENCY RESPONSE ACCOUNT. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio turned the committee's attention to Senate Bill (S.B.) 469 that has not had a formal hearing. He reminded the committee S.B. 469 is a trailer bill to correct the name of the lessee reflected on line 10, page 2, from the City of Reno to the Silver Lake Water Distribution Company. SENATE BILL 469: Revises provisions of Assembly Bill No. 387 of this session concerning approval of lease of state water rights. SENATOR RHOADS MOVED TO DO PASS S.B. 469. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio turned the committee's attention to Senate Bill (S.B.) 386 heard on May 1, 1995. He pointed out proposals contained in other bills were to be incorporated into the provisions of S.B. 386. SENATE BILL 386: Makes various changes concerning program of accountability of public schools and statewide achievement and proficiency of pupils. Ms. Botts referenced Exhibit M, Amendment No. 423 to S.B. 386. She stated there are several bills pending in the Assembly that deal with amending the school accountability reports school districts are required to provide to citizens in March of each year, and Exhibit M incorporates many of the changes arrived at by combining several bills. Ms. Botts highlighted the significant portions of Exhibit M with the committee. Senator Raggio pointed out item 2 (c), (d), (e), (f), (g), and (h) of Exhibit M incorporates the provisions contained in Assembly Bill (A.B.) 197. ASSEMBLY BILL 197: Makes various changes to provisions governing program for accountability of school districts. Ms. Botts resumed her discussion of Amendment No. 423 by highlighting items (I) - (n) on page 3 of Exhibit M. Senator Raggio stated the reviewed items incorporates the provisions contained in Assembly Bill (A.B.) 124. ASSEMBLY BILL 124: Revises provisions governing program for accountability of school districts. Ms. Botts returned the committee's attention to item 2 (b), page 3, Exhibit M and concluded her discussion of the amendment changes. Senator Raggio recalled the Governor recommended a one-time appropriation of $479,000 as provided by Senate Bill (S.B.) 203 for the Reading and Math Proficiency Examination Program at grades 4 and 8. SENATE BILL 203: Makes appropriation to the department of education for Reading and Math Proficiency Examination Program at Grades 4 and 8. Ms. Botts concurred and said S.B. 386 will increase the appropriation to $670,000. The additional amount will cover the costs associated with centralized scoring of proficiency examinations, and an equating study. The appropriation will also cover the purchase of test booklets, answer sheets, classroom guides for teachers, and manuals for those administering the tests, Ms. Botts said. Senator Rawson noted there had been discussion regarding a change to line 21, page 1, of S.B. 386 for "books, supplies, administration, and salary." He stated this information is omitted from Amendment No. 423 (Exhibit M). Ms. Botts stated Senate Bill (S.B.) 27 includes an appropriation for all books, materials and supplies that are in shortage for each school, the average salary of teachers for each school, the number and age of computers used by each school, and the number of pupils receiving special education. SENATE BILL 27: Requires school districts to report certain additional information to residents of district and to state board of education. Senator Rawson said the committee is concerned a greater percentage of the appropriation may be designated for teacher's salary and not for books and supplies. Ms. Botts stated there is a chart in the accountability reports that reflects the expenditures, per pupil, at each school, and the amount that is designated for salaries and supplies. She stated although this information is contained in the amendment (Exhibit M) to S.B. 386, more detailed information can be included. Senator Rawson reiterated every pupil in every school, regardless of the salary involved, should be granted an equal expenditure for books and supplies. He opined this provision should be included in the language of S.B. 386. SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 386 IN ACCORDANCE WITH THE PROVISIONS OF AMENDMENT NO. 423. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio recessed the meeting at 10:55 a.m. The meeting was reconvened by Senator Raggio at 1:15 p.m. at which time he turned the committee's attention to Senate Bill (S.B.) 2. SENATE BILL 2: Authorizes private investigators licensing board to employ certain persons to carry out duties of the board. Dan Miles, Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, said an amendment to S.B. 2 will place the executive secretary of the licensing board for private investigators in the unclassified services of the state. Currently, a classified employee serves the board in that capacity. Under S.B. 2, the position would be appointed by the board and be in the unclassified service where the salary would be determined by the Legislature in the unclassified pay bill. SENATOR COFFIN MOVED TO AMEND AND DO PASS S.B. 2 TO PLACE THE EXECUTIVE SECRETARY OF THE LICENSING BOARD IN THE UNCLASSIFIED SERVICES OF THE STATE. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED (SENATORS O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio asked for a motion on Senate Bill (S.B.) 226 that will create a trust fund for educational technology in the General Fund. SENATE BILL 226: Creates trust fund for educational technology. SENATOR RAWSON MOVED TO DO PASS S.B. 226. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio asked for a motion on Senate Bill (S.B.) 366 heard on April 24, 1995. SENATE BILL 366: Increases the number of judges of family court in eighth judicial district. Provides general fund appropriation. Mr. Miles said an amendment to S.B. 366 will be needed to appropriate $100,251 from the state's General Fund to add two new district court judges to the family court in Clark County for the eighth judicial district, and to indicate the judges are to be chosen at the general election in November, 1996 to take office in January, 1997. SENATOR COFFIN MOVED TO AMEND AND DO PASS S.B. 366 TO APPROPRIATE $100,251 FROM THE STATE'S GENERAL FUND TO ADD TWO NEW DISTRICT COURT JUDGES TO THE FAMILY COURT IN THE EIGHTH JUDICIAL DISTRICT, AND TO REQUIRE THAT THE NEW JUDGES ARE TO BE CHOSEN BY GENERAL ELECTION IN NOVEMBER, 1996 TO TAKE OFFICE IN JANUARY, 1997. SENATOR RAWSON SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio turned the committee's attention to Assembly Bill (A.B.) 263. ASSEMBLY BILL 263: Authorizes the issuance of revenue bonds for improvement of student union building at University of Nevada, Reno. SENATOR COFFIN MOVED TO DO PASS A.B. 263. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio asked for a motion on Assembly Bill (A.B.) 235 heard by the committee on May 11, 1995. ASSEMBLY BILL 235: Makes appropriation to division of conservation districts of state department of conservation and natural resources for replacement of office equipment and computer hardware and software. SENATOR JACOBSEN MOVED TO DO PASS A.B. 235. SENATOR COFFIN SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio asked for a vote on Assembly Bill (A.B.) 183 heard on May 8, 1995, for the issuance of revenue bonds to pay a portion of the cost of constructing a building at the Truckee Meadows Community College. ASSEMBLY BILL 183: Authorizes issuance of revenue bonds for construction of building for applied technology center at Truckee Meadows Community College. SENATOR JACOBSEN MOVED TO DO PASS A.B. 183. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED. (SENATORS O'DONNELL AND RHOADS WERE ABSENT FOR THE VOTE.) * * * * * Senator Raggio adjourned the meeting at 2:10 p.m. RESPECTFULLY SUBMITTED: Marion Entrekin, Committee Secretary APPROVED BY: Senator William J. Raggio, Chairman DATE: Senate Committee on Finance May 15, 1995 Page