MINUTES OF THE SENATE COMMITTEE ON GOVERNMENT AFFAIRS Sixty-eighth Session April 10, 1995 The Senate Committee on Government Affairs was called to order by Chairman Ann O'Connell, at 2:08 p.m., on Monday, April 10, 1995, in Room 227 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Senator Ann O'Connell, Chairman Senator Randolph J. Townsend, Vice Chairman Senator Jon C. Porter Senator William J. Raggio Senator William R. O'Donnell Senator Dina Titus Senator Raymond C. Shaffer GUEST LEGISLATORS PRESENT: Assemblywoman Barbara E. Buckley Assemblyman Bernard Anderson STAFF MEMBERS PRESENT: Dana Bennett, Senior Research Analyst Teri J. Spraggins, Committee Secretary OTHERS PRESENT: Marvin Leavitt, Legislative Coordinator, City of Las Vegas Gene P. Etcheverry, Budget Analyst, Department of Taxation Jan Needham, Principal Deputy, Legislative Counsel Bureau Michael Pitlock, Executive Director, Department of Taxation Gary Crews, Legislative Auditor, Legislative Counsel Bureau David Pursell, Chief, Division of Assessment Standards, Department of Taxation Mark Balen, President, Professional Fire Fighters of Nevada Barbara McKenzie, Lobbyist, City of Reno Doug Dickerson, Lobbyist, City of Las Vegas Terry Lamuraglia, Chief Legislative Representative, Clark County Personnel Department Pat Coward, Lobbyist, City of Sparks Galen D. Denio, Commissioner, Public Service Commission of Nevada Stan Warren, Lobbyist, Sierra Pacific Power Company Tom Fransway, County Commissioner, Humboldt County Board of Commissioners John Russum, Road Superintendent, Road Department, Humboldt County Senator O'Connell announced the first order of business would be a hearing on Bill Draft Request (BDR) S-1948. She told the committee Marvin Leavitt, Legislative Coordinator, City of Las Vegas, would present the bill draft request and then the committee would hear a report from Michael Pitlock, Executive Director, Department of Taxation, and David Pursell, Chief, Division of Assessment Standards, Department of Taxation, which Senate Bill (S.B.) 305 required. BILL DRAFT REQUEST S-1948: Authorize White Pine County School District to borrow money to pay operating expenses of district. SENATE BILL 305: Directs immediate analysis of cash flow of White Pine County School District. (BDR 1874) Mr. Leavitt explained BDR S-1948 (Exhibit C). He told the committee, based on the report from Mr. Pitlock and Mr. Pursell, they changed the ending date for the bill draft request from June 30, 1995 to July 31, 1995. Senator O'Connell asked when they negotiate the loan, how soon could the money be available? Mr. Leavitt responded April 23, 1995 is the payroll due date. He stated they would attempt to have the loan secured as close to April 23, 1995 as possible. He told the committee he is uncertain how long it will take to get the bill through both houses and signed into effect by the Governor. He remarked he scheduled a meeting of the Local Government Advisory Committee (LGAC) for Thursday, April 13, 1995. He added it is obvious the bill will not pass both houses by Thursday, but the LGAC needs to begin the process of securing a loan. Senator O'Connell stated her understanding of the bill is that the lender will not sign on the loan until the Governor has signed the bill. Mr. Leavitt responded the LGAC could discuss the process, the time frame, the wording for proposals, and payment terms. He stated that doing the preliminary work is necessary since there is such a short time line. He reminded the committee the LGAC consists of 11 members and he wants participation from all of them. He stated LGAC may form a subcommittee. He assured the committee there would be no documents signed until the Governor has signed the bill into law. Mr. Leavitt testified the bill has language to cover only operating expenses. He explained the committee will hear from Mr. Pitlock and Mr. Pursell who will show the committee other expenditures during this period which will require payment. He emphasized no capital expenses incurred after April 1, 1995 will be paid by this money. He said, "In other words, you [White Pine County School District] are not going to go out and do more of the same thing and expect to be paid by these interim funds." Senator Raggio asked how much money needs to be borrowed? Mr. Leavitt responded, "In the neighborhood of $2.8 million." Senator Raggio asserted, "We need to make clear that the $2.8 million which is borrowed against future receipts from the DSA [Distributive School Account], that to the amount necessary to repay this . . . that amount of DSA funding also would have to be exempt from negotiations. I do not know if that is implicit, but it needs to be understood. There is going to be a limit, as a result of this to the amount of money that is going to be available for negotiations in that district." Mr. Leavitt stated he had not thought of that, but the Legislature should state it positively in the bill itself. He said White Pine County School District is using the money to pay expenses which they already incurred, by the very nature of it, that money would not be available for payment of salaries in the future. He told the committee it provides a maximum of 5 years repayment. He stated the Legislature did not want to go beyond 5 years to repay this amount. Senator Raggio asked what the total annual operating expense is for White Pine County School District? He said if this is 4 months of operating expense, is the committee talking about an annual operating expense of $5 or $6 million? Gene P. Etcheverry, Budget Analyst, Department of Taxation, stated the budget is $8.9 million annually. Senator Raggio stated a 5-year repayment plan with interest is going to be a major obligation and will severely limit the ability to grant raises and other operating expenses. Mr. Leavitt told the committee repayment of this loan will affect the school's operating budget for the next 5 years. He stated the loan mentioned in this bill draft request will not solve the entire problem which the White Pine County School District is facing. He reminded the committee this loan does not address capital expenditures. He restated the report from Mr. Pitlock and Mr. Pursell will put several things into perspective. He added the tax cap may have to be raised for a limited period for White Pine County to cover their shortfall. Senator Raggio asked if Mr. Leavitt was suggesting that this procedure to allow the White Pine County School District to obtain a loan is not feasible unless they grant White Pine County some special tax exemption to exceed the statutory limit of $3.64. Mr. Leavitt responded: No, I do not think this is contingent upon granting that. I think this is going have to stand on its own. That other part is going to have to be addressed later when we discuss where we stand in relation to that school. I think when you get the report today, you are going to get at least a partial feeling as to where we stand in regard to the capital, but of course, they have not been able, to date, to try to put together a budget for next year that includes the basic salaries, payment on the existing debt, payment on this loan and all of those kind of things, which are going to have to be down the road. But I think this today has to stand on its own without any express guarantees that any kind of tax rates are going to have to be increased. He continued his testimony on BDR S-1948 with an explanation of negotiating the loan. He told the committee that violation of the law in the future would be a misdemeanor offense. He also explained the mechanism in the law for the repayment of the debt. He mentioned there needs to be an assurance that the money coming from the Distributive School Account is in an amount equal to the repayment of the loan. He said it could be confirmed through the Senate Committee on Finance. Senator Porter asked if White Pine County formally requested the start of this process? Mr. Leavitt stated by resolution at the last board meeting of the White Pine County School District, they formally requested the assistance and acknowledged they indeed have a cash flow problem beyond their ability to solve (Exhibit D). SENATOR TOWNSEND MOVED TO INTRODUCE BDR S-1948. Senator Raggio asked if the motion incorporated the amendments that the committee has been discussing. Senator Townsend stated, "Yes." SENATOR RAGGIO SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** SENATE BILL 305: Directs immediate analysis of cash flow of White Pine County School District. (BDR S- 1874) Michael Pitlock, Executive Director, Department of Taxation, presented the report which was requested by law in S.B. 305. He testified the Department of Taxation was to undertake certain analyses of the financial condition and cash position of the White Pine County School District and report back to the Legislature on April 10, 1995. He circulated the report (Exhibit E) to the committee and stated the report had been compiled with the aid of the legislative auditor. The final summaries had been reviewed by the legislative auditor. He explained page 5 of Exhibit E is a summary of the expenditures by month. He stated these figures were also broken out by funding. He indicated by putting these schedules together, the lack of a credible accounting system at the White Pine County School District, "We do not have a whole lot of comfort with respect to the individual allocations to the funds, but we are fairly comfortable with the total amount. It is that total amount that was the basis for the dollar amount that appears in [BDR S-1948] the bill draft the committee was just discussing." Mr. Pitlock drew the committee's attention to the projected figures through the end of June 1995. He explained this was the time period the Department of Taxation was requested to look at based on S.B. 305. He stated through June 1995 there is a cash- flow shortage of approximately $1.6 million. He told the committee there will be significant expenditures during July and there is not corresponding revenue for that month. He testified, based on the information provided to the committee, the Department of Taxation extended the period of analysis through the end of July. He stated the July expenditures posed a significant problem for the White Pine County School District. He pointed out the proposed deficit at the end of July, which has grown to approximately $2.6 million. He stated: Because of some uncertainty, with respect to what the final costs will be on the commitments made for the high school, for instance, the amount allocated for paving of the parking lot and access roads, we ask that an amount of $2.8 million be placed in the legislation. Therefore, giving us a little of a cushion for some of these numbers we are not real certain of yet. He continued his testimony by saying: In addition to that, on page 10, we've attempted to try to quantify what we believe may be closer to the true magnitude of the problem in White Pine [County School District]. Based on the current intent of the school district, they could be facing a shortfall in excess of $3.5 million. I indicated this was based on the current intent of the school board. Some of these expenditures, because of the finding of financial difficulty, will have to be approved by the Department of Taxation. I can tell you at this point in time, because of the financial condition of the White Pine County School District, and the amounts that have been expended to date on that school; I do not believe that approval will be forthcoming from the department [Department of Taxation] to make some of these additional expenditures that we do not believe are critical to the actual operation of that facility. But I wanted to include this number in the report to make sure that the committee. . . and the school board as well, understood the magnitude of the problem. One of the most frustrating aspects about dealing with this situation was trying to get the attention of the people in White Pine [County]. Some of them on the school board do not seem to understand the magnitude of the problem, even to this date. We wanted to make sure they were aware of that. This information, the format and the review was done after we reached agreement with the legislative auditor with respect to the procedures that would be followed. Again, there is a disclaimer on page 10 [Exhibit E] based on the inadequacy of the accounting system. There is no way we can be absolutely certain of these numbers, but we do feel fairly comfortable with the magnitude of the bottom line number, the $2.8 million. At this point, I would like to allow Mr. Crews to indicate the involvement of his auditors in this project. Gary Crews, Legislative Auditor, Legislative Counsel Bureau, stated: In accordance with S.B. 305, we placed a comfort letter following Mr. Pitlock's letter here on the third page of the handout [Exhibit E]. Basically we reviewed the cash analysis disbursements and receipts from last July through March 31 [1995]. In addition we reviewed the projections of cash receipts and disbursements made on throughout the rest of the year, including July of 1995. Based on our analysis of the review, we feel fairly comfortable with the bottom line figure. We are not comfortable, necessarily with the numbers in each one of the funds, . . . there's been some commingling of funds . . . cash within the funds . . . a number of bank accounts . . . controls are nonexistent . . . assorted other problems associated with this particular project. Mr. Crews continued: As Mr. Pitlock indicated, there's some intentions by the board, which are reflected on page 10 of this particular document [Exhibit E]. Finishing the school for one thing, and ordering some school buses are another issue which pushes the figure up to close to $3.6 million. I think, based on the records that we had to work with and the time constraints, I think we've got a document that comes close to projecting what the balances will be, providing that there are not some decisions, made from this point on by individuals over there [White Pine County], that would step outside the boundaries of the controls placed on them by the Department of Taxation. Senator O'Connell asked Mr. Pursell to provide information regarding the purchase of school buses. Mr. Pursell responded: It is our understanding right now that these were requested through purchase order and there were three additional regular yellow school buses that have been canceled. But our understanding, and we are going to verify this with the company that's building the buses, that they are on the assembly line and they are being built right now. So, we are not sure what the penalty would be if we choose to tell those companies we do not want the buses for the school district. We'll do that as soon as we possibly can, and get the information on that. Senator O'Connell questioned, "So we really are still in a questionable situation as to knowing whether or not we can cancel this order, or whether the penalty would be too great and we would have to go ahead and accept them." Mr. Pursell responded, "That is correct. I think what we want to do is see if there is not someone . . . some other school district within the state that might want those buses that are being built and we'll look into that possibility also." He continued, "The attorney of the school district called me this morning and the superintendent took his personal belongings yesterday and turned the keys in to all of the school sites today. So he's effectively off the premises as of this morning." Senator O'Connell asked if they had information on buying out the superintendent's contract? She asked if there was a penalty in the contract, or would they continue to pay him? Mr. Pursell stated the school board decided to continue to pay the contract because they do not want to litigate with the superintendent. Senator O'Connell asked if he knew the balance of the contract. Mr. Pursell responded "Not at this time, we do not." Senator O'Connell asked him to obtain that information for the committee. Mr. Pursell assured the committee the Department of Taxation would get that information. Mr. Pitlock added additional testimony regarding the contract [for Jan Cahill, Superintendent of White Pine County School District]. He stated the buy out would not be for the full remaining amount of the contract because the superintendent had tendered his resignation effective June 30, 1995. He explained the buy out would only be the difference between when he actually left office and June 30. He told the committee the original contract extended beyond the June 30, 1995 date. Senator Raggio requested clarification about the $2.8 million estimate referenced in Mr. Pitlock's testimony and referenced in BDR S-1948, and the total amount of potential cash requirements that appear in the last page of Exhibit E in excess of $3.5 million. He asked, "How are you suggesting the $2.8 million be used?" Mr. Pitlock responded the basis for the $2.8 million is the cash deficit displayed on page 2 of the handout (Exhibit E). He explained the figures, the cash cushion and the payment schedule. He stated if the school board does not stop their current spending, that the problem is going to get worse. He said some expenditures might not be necessary at this time, particularly the athletic fields and some landscaping. He stated they were exploring options to get out of the obligation for the buses. He noted that they were not asking for funds to cover those amounts. Senator Porter asked for an explanation of windfall contribution received by White Pine County, the city and the hospital of $342,000 from the school district. He asked them to clarify the windfall. He pointed out they have been requested to return all portions of the windfall received from the school district. Mr. Leavitt responded there have been many problems in White Pine County. He said one of the problems was the assessor, who incorrectly determined tax rates. He said they discovered this situation last summer and they attempted to get the assessor to use the correct formula. He stated the tax assessor's work over several years has affected the levied tax rates. He said the entities based their budgets on the tax rate provided by the assessor. Mr. Leavitt told the committee, "Given the financial condition of these other entities, there's no way that they can go back and try to second guess what the assessor should have done and repay the money they have already spent." He testified the assessor has been "straightened out for the future. I do not think it is possible to go back and require those entities to repay money that was included in their budgets, that the budgets were based up, salaries they paid were based upon and those kinds of things, in trying to redo the past. I do not think it is possible at this time to do that." Senator O'Connell closed the discussion on White Pine County and opened the hearing on S.B. 275. SENATE BILL 275: Requires state personnel system to provide that state employee is entitled to copy of findings or recommendations made by appointing authority or his representative regarding proposed disciplinary action. (BDR 23-159) Dana Bennett, Senior Research Analyst, drew the committee's attention to the committee work session document. As there were no amendments proposed to S.B. 275, there was no discussion. SENATOR O'DONNELL MOVED TO DO PASS S.B. 275. SENATOR SHAFFER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 275 and opened the hearing on S.B. 279. SENATE BILL 279: Authorizes special assessment for maintenance, repair or improvement of local improvement projects. Senator O'Donnell informed the committee he had spoken with the various entities involved, and the entities have "no love for this bill." SENATOR O'DONNELL MOVED TO INDEFINITELY POSTPONE S.B. 279. SENATOR RAGGIO SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR TOWNSEND ABSTAINED FROM THE VOTE.) ***** Senator O'Connell closed the hearing on S.B. 279 and opened the hearing on S.B. 280. SENATE BILL 280: Authorizes additional counties to establish medical scholarships for persons who agree to return to the county to practice medicine. Senator Porter told the committee the rural counties would greatly appreciate the committee passing this bill. SENATOR SHAFFER MOVED TO DO PASS S.B. 280. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 280 and opened the hearing on S.B. 282. SENATE BILL 282: Provides for judicial review of disciplinary order of Reno civil service commission. Ms. Bennett drew the committee's attention to a letter from Chan Griswold, Deputy City Attorney, City of Reno (Exhibit F). Senator O'Connell told the committee the only opposition to the bill was from Mark Balen, President, Professional Fire Fighters of Nevada. Barbara McKenzie, Lobbyist, City of Reno, explained previous testimony was that when an employee is disciplined under the rules of the Civil Service Commission, there is not outlined recourse in that matter. She stated to give the employee and the Civil Service Commission a clear avenue for recourse, they can go through the judicial review. She told the committee the appeal could be a minimum of a 4-year process. She said with the judicial review process which is in state law right now, it sets the process out in a way that would be a maximum of 187 days to come to a conclusion on a disciplinary action. She reminded the committee the employee's other avenue is through the arbitration process. She said they could also go through the civil service process. She stated, "We felt that they ought to have a clearer understanding of how they can proceed if they are not happy with the decision of the Civil Service Commission." Senator Raggio stated it seems appropriate that a person should have the opportunity for judicial review. He emphasized he is not clear why the firefighters group opposes this legislation. "Why would they oppose having the right to judicial review?" Mr. Balen responded, "The reason that we object to it is because we have arbitration to go to settle a problem like that. If you go to the Civil Service Commission, and the employer were to win, lose or whatever, they could still take that to have that decision appealed through the judicial review process and prolong the agony of the employee." Senator Raggio asked, "You are saying now, the city does not have the right to go to judicial review." Mr. Balen stated, "They're saying there's no clear cut resolution to a problem and that's not true. There is clear resolution and that is binding arbitration. Even if the Civil Service Board, no matter how they rule, disciplinary matters . . . " Senator Raggio interrupted, "Do you have to get binding arbitration or is that provided?" Mr. Balen responded, "It is provided." Senator Raggio asked, "You have a right to binding arbitration?" Mr. Balen answered, "In disciplinary matters, yes sir." Ms. McKenzie clarified the intent of the bill for the committee. She stated: This provides a process if an employee chooses not to go through the labor contract to pursue their appeal to a decision by the Civil Service Commission. That's all we are trying to do. It is not precluding anybody from not going through the arbitration process if they choose to. If they choose not to, this sets out for the employee the rules, already on the books, for them to be able to do that. Mr. Balen responded, "It seems to us that it is adding more hoops for the employee to jump through before the situation becomes resolved. When an employee is being disciplined, the last thing they want to do is have it prolonged. They want to get to the meat of it and get it settled." Senator Raggio asked, "Why would not the employee who does not like the final decision want the right to go to judicial review? I would." Mr. Balen justified the position of the Professional Fire Fighters of Nevada by saying, "He would take that to binding arbitration. It is binding on both parties." Senator Porter asked, "This has to do with disciplinary order, so if there's a complaint filed by management, currently they would just go to binding arbitration? This would provide another mechanism other than that?" Ms. McKenzie responded, The city is simply trying to put in the charter an option for an employee to have a way to respond to a Civil Service Commission action, that they are not happy with, through the court system in an expeditious manner. Right now they can go through the court system, they have up to 2 years to file and who knows how long it may go on. If they use a judicial review process, there's time limits set on that so they can do it much more quickly than they could if they just go through the regular district court process. Senator Porter asked, "The district court process is different than the arbitration process? So is there actually three mechanisms available for this?" Ms. McKenzie answered, "To my understanding, there could be. Now I'm not clear myself if you go through the Civil Service Commission and then either choose to go through the union process or through the courts. This just clarifies the best way to get through the court system as expediously as possible." Senator O'Connell stated her understanding is that it is permissive legislation. Ms. McKenzie replied, "Yes, it is not mandatory." Senator O'Connell stated it gives the employee an alternative. Ms. McKenzie acknowledged, "If they choose to not go through the union contract process." Senator Raggio asked, "It says 'any person who is aggrieved by a final decision of the commission', is that just the employee?" Mr. Balen responded, "No." Ms. McKenzie responded, "To the best of my knowledge, yes." Senator Raggio stated, "If this is an option, I just really do not understand the point that they are saying they already have binding arbitration, that they do not want this. I really have a difficult time understanding . . . why there is opposition. If this is an additional right for an employee, why there is this resistance to it?" Mr. Balen replied, "The problem is not if the employee has a problem, it's with the employer and the City of Reno, per se. If they get a decision that is going to be binding from the Civil Service Commission on them, I assure you they will take judicial review on every case. That's the problem." Senator Raggio asked, "Then it is available to the city,.." Mr. Balen interjected, "Absolutely." Senator Raggio continued, "As the employer, as well as the employee. You are saying today the city does not have the right to have some kind of review?" Mr. Balen stressed, "If they were to enter into binding arbitration, the matter is settled. It is binding on both sides. We feel that is the most appropriate and fair way to deal with a disciplinary problem." Ms. McKenzie asserted, I suppose the other side of that coin, and I do not think we need to be arguing this in work session, I believe the court's decision is binding as well. I believe the city has the right, right now, to go through the court system. This would ensure they would only go through the court system through the judicial review process which would shorten up the time frame anyway. This was not the intent of the law, to give the city any option we do not already have. It just shortens up the time frame so it is on a faster track to a decision. We have proposed this because of a need to address the needs of the employee. There was never any intent on the part of the city council or the city attorney to do this for any Machiavellian attempt to do anything to our employees. We would like to protect our employees in every way possible and this is one way to do it. Senator Raggio asked how this compared with the procedures in other cities? Doug Dickerson, Lobbyist, City of Las Vegas, provided his opinion to the committee. He stated the employee who has been disciplined has the option of taking the disciplinary action to arbitration or to the Civil Service Commission. He explained if the employee appeals the decision to arbitration, the decision will be final; however, if the employee appeals to the Civil Service Commission, there is no recourse for the employee or the city to get judicial review of the decision. He stated, "I think that is what they are asking for; is that correct Barbara?" Ms. McKenzie responded, "Yes, thank you." Mr. Dickerson explained to the committee there is no opportunity for judicial review, for either the employee or the city, which is the rationale behind the bill. He asserted, "I would think from Mark Balen's point of view, he's saying if an employee wants to make sure, he ought to go through arbitration. He [the employee] has that choice, so he [Mark Balen] does not want that other option available to either the employee or the city to have judicial review of that situation." Senator O'Connell asked Mr. Balen if he is saying this procedure would only prolong the final outcome; if the employee goes to binding arbitration, the decision is there. Does this give the employer another option as opposed to the employee? Mr. Balen responded, "What it does is, it prolongs the process. If you go to the Civil Service Commission, if you take judicial review, you can still go to binding arbitration. What the arbitrator says is final and binding. So why would you go to the Civil Service Commission if you did not have to, period." Senator Porter asked how long it takes for binding arbitration? Mr. Balen stated it depended upon the availability of the arbitrator. It could take 6 months. Senator Porter questioned, "If you had the choice of going 180 days possibly awaiting your appeal, and it's 6 months or longer on binding arbitration?" Mr. Balen stated, "It may possibly be a toss-up. If you go to accelerated arbitration and are able to get an arbitrator right away, you can get a decision within 30 days from the time of the infraction." Senator O'Connell stated the only other charter that has this information in it is the City of Sparks. Ms. McKenzie interjected, "Because they have a Civil Service Commission. All charter cities do not have a Civil Service Commission." Senator O'Connell asked if Sparks has a judicial review process. Ms. McKenzie stated there is a judicial review in Sparks because of their Civil Service Commission process. Terry Lamuraglia, Chief Legislative Representative, Clark County Personnel Department, stated this bill would depend on what the collective bargaining agreement specifically said as to dealing with discipline and binding arbitration. He questioned whether that agreement covers employees who do not belong to the union or not. He continued that he would want to check if they include employees covered by the union in the process or not. Senator O'Connell announced, "Instead of putting everyone on the spot here, I am going to decide. I am going to talk to the City of Sparks and we will get back to you on this bill." Senator O'Connell closed the hearing on S.B. 282 and opened the hearing on S.B. 288. SENATE BILL 288: Revises requirements for annual report of state controller. Ms. Bennett drew the committee's attention to their work session document for this bill. She told the committee there was no opposition expressed to either S.B. 288 or S.B. 289. SENATOR SHAFFER MOVED TO DO PASS S.B. 288. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** SENATE BILL 289: Revises authority of state board of e x a m i n e r s r e g a r d i n g p a y m e n t o f c l a i m s f r o m m o n e y a p p r o p r i a t e d o r a u t h o r i z e d b y L e g i s l a t u r e . SENATOR O'DONNELL MOVED TO DO PASS S.B. 289. SENATOR TITUS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 288 and S.B. 289 and opened the hearing on S.B. 292. SENATE BILL 292: Allows public bodies to hold closed meetings regarding recruitment and selection of public employees. Senator O'Connell informed the committee this bill has been withdrawn. She said the committee must dispose of the bill for the NELIS system. SENATOR O'DONNELL MOVED TO INDEFINITELY POSTPONE S.B. 292. SENATOR TITUS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 292 and opened the hearing on S.B. 182. SENATE BILL 182: Authorizes informal interim leasing of property acquired for public work. Ms. Bennett drew the committee's attention to the proposed amendment for S.B. 182. Ms. Bennett testified the amendment came from Howard Barrett, Lobbyist, Nevada Taxpayers Association. Senator Raggio stated the proposed amendment was not clear in how the excess revenue from the leasing of the property would be spent. Discussion followed with proposed changes in the amendment. Senator O'Connell directed Ms. Bennett to work on the proposed changes and to bring an amendment back to the committee. Senator O'Connell closed the hearing on S.B. 182 and opened the hearing on S.B. 184. SENATE BILL 184: Authorizes public guardian to secure property of proposed ward under certain circumstances. Ms. Bennett drew the committee's attention to their work session document for this bill. Senator O'Connell stated there has not been a new amendment proposed by Ben Graham, Legislative Representative, Nevada District Attorneys Association. SENATOR O'DONNELL MOVED TO INDEFINITELY POSTPONE S.B. 184. SENATOR SHAFFER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 184 and opened the hearing on S.B. 185. SENATE BILL 185: Revises procedures governing reconveyance, sale or exchange of certain land acquired by county. The committee reviewed the bill and the proposed amendments to the bill. There was no discussion. SENATOR TOWNSEND MOVED TO INDEFINITELY POSTPONE S.B. 185. SENATOR O'DONNELL SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 185 and opened the hearing on S.B. 190. SENATE BILL 190: Requires establishment of program for rental by state agencies of surplus equipment and property. Ms. Bennett drew the committee's attention to the proposed amendment for S.B. 190 since this was their first opportunity to see the proposed amendment. She explained the amendment to the committee. She reminded the committee there was testimony presented regarding the database. SENATOR O'DONNELL MOVED TO AMEND AND DO PASS S.B. 190. SENATOR SHAFFER SECONDED the MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 190 and opened the hearing on S.B. 248. SENATE BILL 248: Revises provisions regarding approval by general obligation bond commission of certain types of municipal funding. (BDR 30-109) Ms. Bennett drew the committee's attention to the proposed amendment in their work session document. Mr. Leavitt explained the rationale behind the amendment. He told the committee this amendment will provide language that the General Obligation Bonding Commission considers public need when looking at bonds. He testified situations like White Pine County would not occur in the future if they passed this bill with the proposed language amendment into law. SENATOR O'DONNELL MOVED TO AMEND AND DO PASS S.B. 248. SENATOR RAGGIO SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on S.B. 248 and opened the hearing on S.B. 265. SENATE BILL 265: Requires percentage of amount appropriated or authorized for certain public works for construction or renovation of state buildings to be allocated for works of art for such buildings. Senator Titus reminded the committee this is the "Penny for the Arts" bill, and explained the recommendations for amendments to the bill. She stated the mandatory nature of the bill caused some difficulty. She added the amounts of money for the bill caused problems also. She explained the bill's order has been reversed, the provision to establish or provide for the program stay in place, the possibility of funding is included next. She noted the intent is not to make it mandatory for funding or for every building. She asserted the intent is to make the language in the bill permissive. She stated there is no appropriation anytime except to make any left over revenue in the capital improvements budget available. She said the language would not include buildings in this biennium, but would look ahead to the next biennium. Ms. Bennett pointed out the differences between the proposed amendment and the original bill. Senator Raggio commented it does mandate any funds remaining from other public projects would be placed in this fund. Ms. Bennett stated this is a new part to the bill and was suggested by the Nevada State Council on the Arts and the Buildings and Grounds Division since there is money which reverts to the General Fund from capital projects when they are completed. The suggestion is the moneys be earmarked for this "Art in Public Works" fund. Ms. Bennett continued her analysis of the proposed amendment. She stated the intent of the amendment is to allow a Capital Improvement Plan to decide whether artwork is appropriate and should be included in that project. That Capital Improvement Plan is then reviewed by the Legislature. Senator Raggio stated he still had a problem with the bill. "I need to make it clear that I think there are numerous situations in public buildings where it should be urged to have some expression of art, but I have a problem with a program mandating it in any form . . . I have no problem with going on record as urging architects and engineers and whoever designs projects to keep this in mind. I just do not think this is appropriate use of the public's money to mandate the use for this purpose. I could not even support this amendment." Senator Titus stated this bill is similar to the earlier energy efficiency bill. She said that bill was whittled down until it just encouraged the appropriate parties to look at the design of the building with the perspective of saving energy. She said: If there's no appetite for mandating any money at this point, any appropriation, or any use of left over money, yet there is support for the notion of encouraging art, I would ask you to consider just the first page of the amendment which allows you to set up the possibility of a program for including some art in the future without any funding and not mandating, but just make it permissive. Senator Raggio stated, "Just to breathe life into a bill does not serve a useful purpose. We already have this ability. They do it and they testified that in appropriate buildings that is part of the design. I do not see what good it does us to make that statement over [again]." Senator Titus responded: I think what you have to do now is come in and argue for individual one-shot funding like they got in the Supreme Court Building and the revision of the library, so you have to come in and make a case for art every time. Whereas, if you have a policy statement that you are encouraged to look at all of the buildings from the standpoint of some possible art project from the very beginning, you do not have this . . . coming in afterward to stick up a painting or dig a fountain after the fact. It is part of the whole project. Senator Shaffer said, "I think this program will at least get the three entities [Nevada State Council on the Arts, the State Public Works Board, and the Buildings and Grounds Division] involved in working together. I believe that the State Council of the Arts [Nevada State Council on the Arts] certainly has a lot to add. Everyone can contribute to each other. If that's the only thing that happens, I think it would be worth it." Senator Porter asked if this would establish a program where the Nevada State Council on the Arts, the State Public Works Board, and the Buildings and Grounds Division would come up with a priority list? Senator Titus stated that is basically correct and in the design of projects, the art would be part of the original design. She added funding could come from excess revenue for other art projects and from grants. Senator Raggio stated the problem is that the Legislature is still directing the Nevada State Council on the Arts, the State Public Works Board, and the Buildings and Grounds Division to work together to identify the facilities and work together to incorporate art into that project. "That's a mandate. I do not know why we are so determined to increase the cost of a public works project by mandating and directing. Let's encourage or something of that kind. Let's not mandate and direct what goes on in these public buildings. They have a sense of what they should do. Certainly the State Council of the Arts [Nevada State Council on the Arts] and others can offer something, but let's not mandate and direct taxpayer money to be used for extra costs when they can possibly be used in a better fashion." Senator Titus responded: Actually what we are trying to do here is save money by having the art work incorporated in the very beginning of the design of the project . . . you avoid the problem that was described to us where they came back later and built that very expensive fountain in front of a state building. If it is all part of the design, and some buildings are identified as appropriate, and others are not from the very beginning, you will not be spending a lot more money. We are not going to put up state buildings that have no art in them, except maybe in the prison. Look around this building, there's going to be some art. Why not make it part of the original process so if you have some money you can spend it. If you do not have money, you will not spend it, but if you are spending it, you will be spending it in a fashion that will be less expensive and more better art or more better incorporated into the building from the very beginning rather than what happened with the state building in Clark County. Senator O'Connell asked Senator Titus to bring a new amendment back to the committee which contains permissive language which deals with the design of the building. Senator O'Connell closed the hearing on S.B. 265 and opened the hearing on Assembly Bill (A.B.) 107 ASSEMBLY BILL 107: Revises provisions governing temporary appointment of certain state employees. Assemblywoman Barbara E. Buckley explained A.B. 107 contains educational consistency for disabled students. She told the committee tutoring services at the University and Community College System of Nevada is provided on a part-time basis. She stated under present law, the system cannot employ temporary employees for more than 160 hours in a year. Because of this law, disabled students receiving tutorial service such as readers for blind students, and math tutoring for learning disabled students may have their tutors removed in the middle of the assistance. She emphasized this is disruptive to the student and may hurt their progress in receiving an education. She shared letters of support for A.B. 107 (Exhibit G). She explained this bill would allow temporary employees to work more than 160 hours per year if they are providing assistance to a student with a disability or to a student with an identified academic disadvantage. She stressed the bill appropriates no additional money for the tutoring services, but allows the system more flexibility in providing tutorial services. She urged the committee's support of A.B. 107. Discussion of the bill followed. Ms. Buckley told the committee there are no other adverse fiscal impacts in the bill, either in benefits or taxation. The tutor is never hired over half- time, but can be hired for more than 160 hours per year, but never enough to trigger benefits. She estimated this would affect the 30 to 50 tutors in the system. She explained benefits kick in at 20 hours per week and tutors are warned, when they get close to that amount, that they must cut back on their tutoring. She told the committee it is very difficult to find math tutors for learning disabled students and it takes a special kind of person with skills and patience to tutor. A tutor could excel at what they do and be utilized for several different students, but could not exceed the 20-hour per week cap. She emphasized to the committee that the money budgeted stays the same, this bill just allows the system not to have to let someone go and find someone else because they have reached the current 160-hour limit. Senator Titus suggested an amendment to the committee. Senator O'Connell directed Ms. Bennett to work with Ms. Buckley to bring an amendment forth to the committee. Senator O'Connell closed the hearing on A.B. 107 and opened the hearing on Assembly Bill (A.B.) 174. ASSEMBLY BILL 174: Eliminates requirement of residency for city clerk of City of Sparks. (BDR S-1219) Assemblyman Bernard Anderson explained A.B. 174 to the committee. He stated several years ago the citizens of Sparks chose to change the city clerk's position from an elected position to an appointed position. They changed the charter of the City of Sparks at that time. He stated although all the previous incumbents were residents, residency is no longer a requirement of the position. Senator O'Connell closed the hearing on A.B. 174 and reopened the hearing on A.B. 188. ASSEMBLY BILL 188: Repels prospective expiration of provision requiring public utilities to pay assessments for certain expenses incurred by public service commission of Nevada. (BDR S-895) Galen D. Denio, Commissioner, Public Service Commission of Nevada, explained A.B. 188 repeals the sunset provision in Nevada Revised Statutes (NRS) 703.145 which would cause part of the statute to expire on October 1, 1995. He stated the purpose for this particular part of the statute is to allow the Public Service Commission of Nevada to assess a public utility for travel, assistance, audits and personal appearances by commission members and staff. He explained they incur these expenses as the result of interventions in Federal Energy Regulatory Commission proceedings as authorized in NRS 703.152, the Federal Communications Commission or other federal regulatory agencies. He explained the total amount assessed by the commission in 1 year must not exceed $50,000. He stressed the importance of collecting the fees when the intervention occurs (Exhibit H). Stan Warren, Lobbyist, Sierra Pacific Power Company, stated support for A.B. 188. Senator O'Connell closed the hearing on A.B. 188 and reopened the hearing on S.B. 282. Mr. Anderson stated he has been out of contact with that area of the city charter. Pat Coward, Lobbyist, City of Sparks, stated he would go to the city manager and obtain a status report on how that part of the city charter is working. He assured the committee he would research their questions and would provide answers. Senator O'Connell closed the hearing on S.B. 282 and opened the hearing on A.B. 179. ASSEMBLY BILL 179: Revises circumstances under which board of county commissioners may authorize use of certain county equipment on private roads. (BDR 20-1438) Tom Fransway, County Commissioner, Humboldt County Board of Commissioners, testified in favor of A.B. 179 by providing examples of how this would work for the county and for private roads. He maintained this bill is good for all 17 counties. John Russum, Road Superintendent, Road Department, Humboldt County, testified there are ranchers in the outlying areas which allow the road department to park equipment on their private land, allow the workers to camp on private land if needed. They give these workers permission to use the ranch facilities to fix flat tires or change cutting edges. He said that telling the ranchers "No" is very hard when they ask for a favor. This law would allow the road department flexibility to return a favor. SENATOR RAGGIO MOVED TO DO PASS A.B. 179. SENATOR TOWNSEND SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** Senator O'Connell closed the hearing on A.B. 179. After a short discussion, the committee decided to take action on A.B. 174 and A.B. 188. SENATOR RAGGIO MOVED TO DO PASS A.B. 174. SENATOR PORTER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** SENATOR TOWNSEND MOVED TO DO PASS A.B. 188. SENATOR RAGGIO SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** The meeting adjourned at 4:30 p.m. RESPECTFULLY SUBMITTED: Teri J. Spraggins, Committee Secretary APPROVED BY: Senator Ann O'Connell, Chairman DATE: Senate Committee on Government Affairs April 10, 1995 Page