MINUTES OF THE SENATE COMMITTEE ON FINANCE Sixty-eighth Session June 29, 1995 The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 8:55 a.m., on Thursday, June 29, 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: Assemblyman David E. Humke, Assembly District No. 26 STAFF MEMBERS PRESENT: Dan Miles, Fiscal Analyst Bob Guernsey, Principal Deputy Fiscal Analyst Brian M. Burke, Program Analyst Marion Entrekin, Committee Secretary OTHERS PRESENT: Brooke Nielsen, Assistant Attorney General, Office of the Attorney General Harvey Whittemore, Lobbyist, R. J. Reynolds Tobacco Company Elizabeth Breshears, Chief, Bureau of Alcohol and Drug Abuse, Department of Employment, Training and Rehabilitation Rose McKinney-James, Director, Department of Business and Industry Donald J. Melllo, Court Administrator and Director of the Administrative Office of the Courts, Office of Court Administrator, Judicial Branch Ann Wilson Andreini, Executive Assistant, Governor's Office Phillip A. Galeoto, Lieutenant, South Division, Police Department, City of Reno Senator Raggio said Amendment No. 1383 to Senate Bill (S.B.) 444 , approved by the committee on June 26, 1995, has now been received and will be submitted for inclusion. SENATE BILL 444: Makes contingent appropriation to Mineral County School District for a portion of the costs of construction of a school to replace Schurz School. Senator Raggio requested introduction of the following bill draft request (BDR) that contains appropriations for various projects approved by the the committee. BILL DRAFT REQUEST 33-2166: Makes various appropriations from state general fund and revises provisions concerning governmental financial administration. SENATOR JACOBSEN MOVED TO INTRODUCE BDR 33-2166. SENATOR RHOADS SECONDED THE MOTION. Senator O'Donnell indicated that within the scope of the measure is a provision concerning Deoxyribonucleic Acid (DNA). He disclosed that although he works for police departments in various parts of the state, he will not benefit by any of the funds that will be appropriated for DNA purposes. THE MOTION CARRIED. (SENATOR RAWSON WAS ABSENT FOR THE VOTE.) * * * * * Since the committee has already voted on all of the issues contained within BDR 33-2166, Senator Raggio requested another motion recommending "Do Pass" on the proposed bill. SENATOR JACOBSEN MOVED TO RECOMMEND A DO PASS MOTION FOR BDR 33-2166. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * It should be noted that BDR 33-2166 was assigned as Senate Bill (S.B.) 579 and approved on the floor of the Senate on June 29, 1995. SENATE BILL 579: Makes various appropriations from state general fund and revises provisions concerning governmental financial administration. Senator Raggio opened the meeting for discussion of Assembly Bill (A.B.) 637. ASSEMBLY BILL 637: Revises provisions governing crimes related to tobacco and makes appropriation to bureau of alcohol and drug abuse of rehabilitation division of department of employment, training and rehabilitation. Brooke Nielsen, Assistant Attorney General, Office of the Attorney General, indicated she is present today regarding Assembly Bill (A.B.) 622 which is a companion bill to A.B. 637 that will provide the funding source for the enforcement measures set forth in A.B. 622. ASSEMBLY BILL 622: Revises provisions related to tobacco. A.B. 622 provides that the Office of the Attorney General will enforce the anti-teen smoking laws in the State of Nevada by performing unannounced inspections at retail locations. It will also require that surveys be conducted to determine if retailers throughout the state are complying with the law against selling tobacco products to minors. She pointed out the compliance measure is important due to a federal requirement that inspections, surveys, and enforcement measures occur before federal funding associated with tobacco enforcement can be granted to the Bureau of Alcohol and Drug Abuse (BADA). Senator Raggio asked if the aforementioned federal requirement is in accordance with the Synar Amendment. Ms. Nielsen responded in the affirmative. She stated under the terms of the Synar Amendment, the state must demonstrate enforcement of the laws pertaining to the selling of tobacco products to minors. Senator Raggio asked if the appropriation proposed by A. B. 637 should be directed to the attorney general's office rather than BADA. Harvey Whittemore, Lobbyist, representing R. J. Reynolds Tobacco Company, said if the Senate chooses to process A.B. 622, the necessary changes to A.B. 637 should be modified by amendment to allocate the funds to the Office of the Attorney General rather than to the BADA. He explained this will enable the attorney general to comply with the inspection and enforcement measures articulated under the terms of A.B. 622. Elizabeth Breshears, Chief, Bureau of Alcohol and Drug Abuse, Department of Employment, Training and Rehabilitation, said if the Office of the Attorney General is given the legal responsibility for enforcement and compliance of the laws, the BADA concurs funding should be given to the Office of the Attorney General to guarantee there will be no loss of federal funds. Senator Raggio asked, "Then you do agree that the amendment should be made to A.B. 637, and the funds appropriated to the attorney general for this purpose." Ms. Breshears replied, "Yes, sir." Senator Raggio noted A.B. 637 will appropriate $60,000 for Fiscal Year 1995 - 1996, and $60,000 for Fiscal Year 1996 - 1997. He asked Ms. Nielsen how these funds will be utilized. Ms. Nielsen replied A.B. 622 will require the attorney general to either enforce the law directly or contract with other law enforcement agencies or individuals to fulfill the requirements of the law in a fair and impartial manner. She said the attorney general reviewed the possibility of performing the inspection activities, but this will require personnel, and be more expensive than the $60,000 fiscal impact of A.B. 637, the amount requested by the BADA. She opined the Office of the Attorney General will be able to accomplish the required inspections and surveys statewide with the funding allocated, but stipulated the committee will be alerted should the funds be insufficient. Senator Raggio said although the committee will not be dealing with the substance of A.B. 622, it is his understanding this measure will require unannounced inspections or purchases to be made by vendors of tobacco products. He said there will be sufficient safeguards written into the language of A.B. 622 to prohibit vendors from disguising themselves in an effort to look younger. He directed it will be important for the committee to read A.B. 622 in connection with A.B. 637. Senator Raggio further stated the chairman of the Senate Committee on Judiciary has indicated the language of A.B. 622 was carefully drafted to ensure the issue of entrapment has been properly addressed, and is in conformance with federal requirements. Mr. Whittemore confirmed the chairman's statement regarding the purposes of A.B. 622 is exactly correct. He further stated: A broad coalition in support of A.B. 622 and the funding mechanism of A.B. 637 was needed to make sure we are in compliance for the federal funding. To clarify, the amount this year would be 10 percent of a $6.4 million grant if we did not have sufficient enforcement, and each year could go up over the next 4 years up to a 40 percent drop in available federal funds. It is our desire to process legislation to meet federal requirements while balancing the standards for the retailers. Senator Raggio asked that a motion be made on A.B. 637 which will include an amendment to change the recipient of the appropriation from the BADA to the Office of the Attorney General. SENATOR RAWSON MOVED TO AMEND AND DO PASS A.B. 637 TO CHANGE THE RECIPIENT OF THE APPROPRIATED FUNDS FROM BADA TO THE OFFICE OF THE ATTORNEY GENERAL. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio reported the receipt of Amendment No. 1345 to Senate Bill (S.B.) 405, and reviewed the changes to the measure suggested by the amendment (Exhibit C). SENATE BILL 405: Provides for establishment of family resource centers in certain neighborhoods to provide and administer social services. Dan Miles, Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau, stated S.B. 405 will provide $565,000 in each fiscal year of the coming biennium to the Department of Human Resources to establish a number of family resource centers throughout the state in high-risk neighborhoods. He said the centers will provide convenient access to social services to the residents of those neighborhoods. SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 405 WITH AMENDMENT NO. 1345. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio indicated the committee is in receipt of replacement Amendment No. 1417 to Senate Bill (S.B.) 471 that was approved on June 28, 1995, with Amendment No. 1358. SENATE BILL 471: Revises provisions governing eligibility for coverage for long-term care under state plan for assistance to medically indigent. Mr. Miles outlined the changes provided in Amendment No. 1417 (Exhibit D) with the committee. He said the new amendment takes some of the duties associated with the Department of Human Resources and transfers them to the Department of Taxation who is better equipped to determine if the counties should be allowed to access a limited pool of reserved and unobligated provider tax revenues. Senator Raggio asked the committee to agree, by vote, with the substitution of Amendment No. 1417 to S.B. 471 in place of Amendment No. 1358. SENATOR RAWSON MOVED TO AMEND AND DO PASS S.B. 471 WITH AMENDMENT NO. 1417 IN LIEU OF AMENDMENT NO. 1358. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio opened the meeting on Assembly Bill (A.B.) 581 that the committee reviewed in depth on June 28, 1995. ASSEMBLY BILL 581: Makes various changes concerning department of business and industry. Senator Rhoads indicated he has met with the director of the Department of Business and Industry, and after further discussion, he opined A.B. 581 should be approved as written. Rose McKinney-James, Director, Department of Business and Industry, indicated the committee was provided with proposed language, written by Nancyann Leeder, Nevada Attorney for Injured Workers, for inclusion in A.B. 581. SENATOR RAWSON MOVED TO AMEND AND DO PASS A.B. 581 WITH AMENDMENT NO. 1443. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio called the committee's attention to Assembly Bill (A.B.) 288 that he said should be compared with Senate Bill (S.B.) 241, and Amendment No. 1115 to S.B. 241. ASSEMBLY BILL 288: Makes various changes affecting state board of parole commissioners. SENATE BILL 241: Increases number of members of state board of parole commissioners. Senator Raggio reviewed the changes to S.B. 241 reflected in Amendment No. 1115 (Exhibit E). Ann Wilson Andreini, Executive Assistant, Governor's Office, and Phillip A. Galeoto, Lieutenant, South Division, Police Department, City of Reno, were given copies of Exhibit E for their review. He suggested Ms. Andreini and Mr. Galeoto review Amendment No. 1115 to S.B. 241 to provide input before the committee. Senator Raggio remarked: If it can be agreed upon, we can amend A.B. 288. What we are interested in doing is increasing the membership of the board by one person, putting in the requirements shown in the amendment...qualifications for the membership of the board listed on page 3 of the amendment [Exhibit E], the preparatory training requirement for parole board commissioners, and on page 6 [Exhibit E] there is a provision as to certain standards that are to be adopted by the board, and the action must be consistent with those standards. Mr. Miles indicated that the Fiscal Analysis Division discovered an apparent error in a measure pertaining to the budget. He explained: The State Climatologist is currently in a separate budget account generally funded in the proposed budget and the budget approved by these committees. That cost would have been transferred as a contract under the director of the Department of Conservation and Natural Resources of about $25,000 a year. We discovered that the E-900 module that transfers that expense into the director's budget was funded with balance forward monies, and there are no balance forward funds in that account. There are two options. One is to process in some bill someplace $25,000 a year to that account for those expenses. On the other hand since that is a generally funded account itself, once the budget is completed it will be rolled together and the appropriation in that account would support those expenditures until near the end of the year when that account would run out of funds and end up $25,000 short. The other option would be to issue a Letter of Intent to the agency to return to the Interim Finance Committee for an augmentation of their budget when that occurs in order to cover these expenses. Senator Raggio requested a motion be made to issue a Letter of Intent to the Office of the State Climatologist as recommended by Mr. Miles. SENATOR JACOBSEN MOVED TO ISSUE A LETTER OF INTENT TO THE OFFICE OF THE STATE CLIMATOLOGIST TO APPEAR BEFORE THE IFC FOR AN AUGMENTATION OF THEIR BUDGET AS REQUIRED FOR EXPENSE PURPOSES. SENATOR RAWSON SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio turned the committee's attention to Senate Bill (S.B.) 495. SENATE BILL 495: Makes various changes to provisions governing collection of fines and assessments. Donald J. Mello, Court Administrator and Director of the Administrative Office of the Courts, Office of Court Administrator, Judicial Branch, stated that all of the changes to S.B. 495 that were discussed before this committee at prior meetings have been accomplished as reflected in Amendment No. 1372 (Exhibit F), with the exception of a change that should be made on page 7, subsection 3(b). He indicated lines should be deleted so that this section will read, "the county recorder in the county in which the court is located." Senator Raggio indicated the committee agreed to amend S.B. 495 on June 27, 1995, but a replacement amendment will be requested to accomplish the suggested change. SENATOR O'DONNELL MOVED TO AMEND AND DO PASS S.B. 495 WITH A REPLACEMENT AMENDMENT TO AMENDMENT NO. 1372. SENATOR JACOBSEN SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio requested Senator Jacobsen provide a report to the committee concerning the results of the meeting held today with the Legislative Commission. Senator Jacobsen remarked: We put back in things that were in the policy from before, including ALEC [American Legislative Exchange Council], and decided that any future requests for travel to attend meetings, or for any activity, will have to be approved by the Legislative Commission and be authorized from there. Senator Raggio stated in view of the action by the Legislative Commission, he will entertain a motion from the committee to restore the funding previously withheld from the Legislative Counsel Bureau (LCB) budget. SENATOR JACOBSEN MOVED TO RESTORE THE FUNDING PROPOSED IN THE LCB BUDGET IN THE APPROPRIATE AMOUNTS FOR DUES, TRAVEL, AND RELATED ITEMS. SENATOR RAWSON SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY Senator Raggio announced a recess at 9:40 a.m. until the call of the chairman. Senator Raggio reconvened the meeting at 2:00 p.m., and called the committee's attention to Senate Bill (S.B.) 386 to which the Assembly Committee on Ways and Means added Amendment No. 1281. He indicated the committee's approval of the changes proposed by the amendment to S.B. 386, and asked that a motion be made concurring with the Assembly. SENATE BILL 386: Makes various changes concerning program of accountability of public schools and statewide achievement and proficiency testing of pupils. SENATE BILL 386: Makes various changes concerning program SENATOR RAWSON MOVED TO CONCUR WITH ASSEMBLY AMENDMENT NO. 1281 TO S.B. 386. SENATOR MATHEWS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio remarked Senate Bill (S.B.) 526 has been amended by the Assembly Committee on Ways and Means to delete section 2 of S.B. 526. The committee reviewed the proposed Amendment No. 1353, and expressed their disagreement with the suggested changes. SENATE BILL 526: Revises authorized activities of director of office of science, engineering and technology. SENATOR O'DONNELL MOVED TO NOT CONCUR WITH ASSEMBLY AMENDMENT NO. 1353 TO S.B. 526. SENATOR RAWSON SECONDED THE MOTION. Senator Raggio recommended Senator Rawson, Senator Jacobsen, and Senator Mathews be appointed to meet for the purpose of discussing the language of this measure, and to review in detail the amendment suggested by the Assembly Committee on Ways and Means. THE MOTION CARRIED UNANIMOUSLY. * * * * * Senator Raggio returned the committee's attention to A.B. 288 and Amendment No. 1115 to S.B. 241. Ann Wilson Andreini, Executive Assistant, Governor's Office, distributed Exhibit G, proposed amendment to A.B. 288, that she said will help to bring A.B. 288 into compliance with S.B. 241. She proceeded to highlight the major issues contained in Amendment No. 1115 (Exhibit E), along with the suggested amendment to A.B. 288 (Exhibit G), with the committee. Ms. Andreini pointed out Exhibit G suggests the Department of Motor Vehicles and Public Safety (DMV&PS), and the Department of Prisons (DOP) should establish orientation programs for all of the new members of the State Board of Parole Commissioners so that the new members can go through a process to learn all of the policies and procedures of the two departments in addition to acquiring training from out-of-state sources currently being utilized. Senator Raggio noted the amendment to S.B. 241 specifies that upon appointment to the board, a member should attend preparatory training in a number of areas directly relating to the performance of their duties as a Parole Commissioner. He suggested this is an issue and should be made a part of the measure. Ms. Andreini continued to highlight Exhibit E and Exhibit G with the committee pertaining to the educational background, qualifications, and level of experience the parole board members should have. Phillip A. Galeoto, Lieutenant, South Division, Police Department, City of Reno, stated he assisted in drafting the proposed amendment to A.B. 288 , and said the intention of the language contained in the amendment will require that parole board members either have a mix of academic achievement and experience, or enough experience to qualify for the position. Discussion ensued after which it was concluded by the committee that members of the parole board should have specific qualifications such as a degree in criminal justice, law enforcement or psychology, sociology, social work law, prison or parole administration, or a total of 6 years experience in one of those specified areas Senator Raggio remarked: Let me address a potential problem, and that is the removal of a parole board member by the Governor. And this is no reflection on the existing Governor or any Governor. Based upon my conversations, this committee wants to retain a situation where the Governor cannot at will, or for probable cause, remove Parole Commissioners. That is not an indictment on the Governor or on the board, but I think incidents that have occurred support the concept that members of the parole board should be as free as possible to exercise their discretion in making their decisions, and not have to be concerned that a budget is not met or artificial reasons otherwise exist such as political pressure. The members should not have to concern themselves that if they do or do not release somebody, there will be political pressure. I think that is the rationale on which most of the removal provisions that occur in other jurisdictions is based. I think we have to keep this as nonpolitical as possible. That is our intention. Senator O'Donnell remarked he understands it is the desire of the Governor to remain in control of the parole board, but asked why it would be desirable to place a Governor "right in the middle of" parole board hearings as suggested by the proposed amendment to A.B. 288. Ms. Andreini responded, "I completely see your point. I do not have a problem with removing the Governor from that section." Senator Raggio acknowledged the presence of Assemblyman David E. Humke, Assembly District No. 26, and advised him the committee is reflecting on the issue of how board members can be removed. He noted page 3 of A.B. 288 retains the language as presently written that board members will be placed in unclassified service with no opportunity for removal by the Governor. Mr. Humke replied this was done based on a legal opinion that it is not constitutional to do anything that would represent a middle ground between appointment for a specified term of years, and service at the pleasure of the chief executive. He indicated he favored some form of removal process based upon proper notice and a hearing, but he understands this may politicize the board. It was discussed in those cases involving either a capital offense for inmates serving a life sentence or for those convicted of a sexual offense involving the use or threat of force or violence, or those whose sentence has been commuted by the State Board of Pardons Commissioners, the parole board must have at least three members reviewing the case, and the concurrence of at least two members. Senator Raggio interjected action can only be taken with the concurrence of at least four members of the full board. He stated the provision regarding concurrence by four members is in the existing law. Mr. Miles clarified section 1 becomes effective on July 1, 1995, in which the number of concurring members is changed from two to four. Prior to closing the hearing on A.B. 288, Senator Raggio suggested a meeting be held with designated members of the Assembly Committee on Ways and Means and the Senate Committee on Finance to discuss the proposed amendments in more depth. He indicated another amendment should be drafted that will include major items from both amendments. Senator Raggio distributed copies of Amendment No. 1404 to Senate Bill (S.B.) 204 and asked the committee to review the amendment for action at a later time. SENATE BILL 204: Makes appropriation to University and Community College System of Nevada and to department of education for purchase of computers and related communications services to improve access to INTERNET and to increase use of interactive video. Senator Coffin indicated the committee should make certain the Nevada School Network continues to function. He stated the Nevada School Network is only reflected as a pilot project in Amendment No. 1404, but does not indicate it should continue to function. He opined the Nevada School Network should be a named entity within the amendment. Senator O'Donnell said the state will be spending approximately $8 million on software and hardware, and the project will not "go away." Senator Raggio suggested an addition to Amendment No. 1404 to include a commitment to maintain the Nevada School Network. Senator Coffin agreed to Senator Raggio's suggestion. Further discussion of S.B. 204 was held pending receipt of a new amendment to the measure. Senator Raggio adjourned the meeting at 2:55 p.m. RESPECTFULLY SUBMITTED: Marion Entrekin, Committee Secretary APPROVED BY: Senator William J. Raggio, Chairman DATE: Senate Committee on Finance June 29, 1995 Page