MINUTES OF THE SENATE COMMITTEE ON JUDICIARY Sixty-eighth Session May 19, 1995 The Senate Committee on Judiciary was called to order by Vice Chairman Jon C. Porter, at 8:00 a.m., on Friday, May 19, 1995, in Room 224 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. COMMITTEE MEMBERS PRESENT: Senator Mark A. James, Chairman Senator Jon C. Porter, Vice Chairman Senator Maurice Washington Senator Mike McGinness Senator Ernest E. Adler Senator Dina Titus Senator O. C. Lee GUEST LEGISLATORS PRESENT: Assemblyman Thomas Batten Assemblyman David E. Humke STAFF MEMBERS PRESENT: Allison Combs, Senior Research Analyst Lori M. Story, Committee Secretary OTHERS PRESENT: James J. Jackson, State Public Defender, Office of the State Public Defender Susan Meuschke, Lobbyist, Executive Director, Nevada Network Against Domestic Violence Joni Kaiser, Lobbyist, Executive Director, Committee to Aid Abused Women Lucille Lusk, Lobbyist, Nevada Concerned Citizens Bill Cavagnaro, Lieutenant, Lobbyist, Las Vegas Metropolitan Police Department (METRO) Phil Galeoto, Lieutenant, Lobbyist, City of Reno, Reno Police Department John Sarb, Administrator, Division of Child and Family Services, Department of Human Resources Nancy Angres, Chief Deputy, Human Resources Section, Office of the Attorney General William Young, Lieutenant, Vice/Narcotics Bureau, Las Vegas Metropolitan Police Department (METRO) Randall Todd, Dr. PH, State Epidemiologist George W.T. Flint, Lobbyist, Executive Director, Nevada Brothel Association Madelyn Shipman, Assistant District Attorney, Washoe County District Attorney's Office John P. Fowler, Chairman, Executive Committee, Business Law Section, Nevada State Bar Dale A.R. Erquiaga, Chief Deputy, Office of the Secretary of State Douglas Walther, Senior Deputy Attorney General, Division of Financial Institutions, Office of the Attorney General SENATE BILL 436: Revises provisions governing reports required of state public defender. Senator Porter noted his duties as chair would only last until Senator James arrives, upon completion of his testimony before the Assembly Committee on Judiciary. Senator Porter opened the hearing on Senate Bill (S.B.) 436 and called James J. Jackson, State Public Defender, Office of the State Public Defender, to present the bill. Mr. Jackson commented the bill is simply a "cleanup" bill. In 1991, at the request of certain counties, requirements were imposed on the state public defender's office to provide certain reports and notification of budgets. This requirement was inserted in the statute that deals with county public defenders. S.B. 436 will simply move those requirements out of chapter 260 Nevada Revised Statutes (NRS) and placing it, in its exact form, in chapter 180 of the NRS. This is the entire purpose of the bill, he reported. There were no questions and the witness was excused. ASSEMBLY BILL 395: Creates rebuttable presumption that upon dissolution of marriage, sole or joint custody of child by perpetrator of domestic violence or by former spouse convicted of sexual assault is not in best interest of child. The next bill to be heard was Assembly Bill (A.B.) 395. Assemblyman Thomas Batten is the sponsor of the bill and introduced it to the committee. Mr. Batten asked to bring up two supporting witnesses, Susan Meuschke, Lobbyist, Executive Director, Nevada Network Against Domestic Violence, and Joni Kaiser, Lobbyist, Executive Director, Committee to Aid Abused Women. Mr. Batten introduced Ms. Meuschke and Ms. Kaiser, and then made his statement regarding the bill. He noted the bill has two parts; part one deals with persons who commit domestic violence or sexual assault and are presumed not to be the most likely candidates for custody of a child in a divorce; part two makes provision for an evidentiary hearing where facts will be uncovered as to the real situation in the home regarding domestic violence. Ms. Meuschke offered comments from a prepared statement (Exhibit C) and referred to a report just recently released regarding domestic violence in the state of Nevada (Exhibit D Original is on file in the Research Library.). Ms. Meuschke noted the report was the result of 2 years of work starting with a conference sponsored by then-Chief Justice Bob Rose and continuing with a series of town meetings held throughout Nevada. This team developed a series of recommendations, she explained, about ways to deal with domestic violence. The witness noted one of the recommendations of the study team is creating a rebuttable presumption against awarding custody to a "batterer," which is the subject of the instant bill (p. 69, Exhibit D). Ms. Meuschke suggested the reason the bill is important relates back to responses made when people talk about domestic violence and custody. Many people assume this presumption is already the law, she noted. It is not the case, the witness stated, revealing she has been witness to many such hearings where the judge says things like "I don't really care what they do to each other, I'm only concerned in the best interests of the child." It is impossible to separate the two issues, she opined. Ms. Meuschke asked the committee to support this very important piece of legislation and offered to answer their questions. Next, Ms. Kaiser addressed the committee. She offered a copy of her testimony as Exhibit E. She also offered to answer questions for the committee. Senator Porter observed that domestic violence is real tragedy for the American family, and asked how the bill ensures against false allegations of abuse, which arise in an attempt to punish or strike-out at a partner during the period of divorce. He stated such accusations can be as detrimental to innocent parties as to guilty parties, if they are believable and used against individuals in awarding child custody. Mr. Batten directed attention to subsection 6 of the bill which outlines the evidentiary hearing designed to determine who is the primary physical aggressor. This hearing considers those factors outlined in the section including all prior acts of domestic violence, involving either party; the relative severity of the injuries, the likelihood of future injury; and any other factors the court many deem relevant to the determination, Mr. Batten explained. He noted the reason conviction of domestic violence was not a requirement is many times an arrest for such violence does not result in a conviction because the victim subsequently decides not to pursue the matter, for various reasons. Senator Porter pointed out that Boulder City was one of the first communities in the state to require that all reports of domestic violence be investigated. He noted he is not an expert in the field, but he is aware that in may cases a report is made, but once the investigation starts the parties fail to provide information about the incidents. Additionally, the high level of awareness about domestic violence has resulted in an increase in the number of complaints received, he said. Assuming some of these complaints are not legitimate, what happens at these evidentiary hearings. Are unsubstantiated complaints enough evidence to result in a loss of custody, he asked. Ms. Meuschke emphasized the bill provides for a rebuttable presumption, that is, an opportunity is provided where it can be rebutted or shown to be false. If there is not evidence to show the acts of violence actually occurred, the presumption is overturned, she noted. On the other hand, these hearings provide a forum to allow parties in a relationship to talk about the violence that may exist, along with the impact of the violence on the children in the union, she stated. The court will not be allowed to overlook the violence in the adult relationship when considering the custody arrangements for the children upon passage of this bill, she asserted. Senator Porter agreed with the witness, stating he is playing "devil's advocate" in order to help the bill. He does wish to make sure there are sufficient safeguards to stop cases of false accusations that do occur, he noted. Ms. Kaiser opined the bill does provide the safeguards needed to protect innocent parties from false accusations. She noted in Washoe County during the last fiscal year there were processed 3,555 temporary protection orders. She stated there is no doubt that some of those orders were requested under false pretenses. However, the judge made the determination in all the cases, and in the vast majority of them, there are real reasons and needs for these orders. Ms. Kaiser stressed it is service to the majority that should be provided. Senator Adler observed section 1, subsection 5 of the bill is appropriate, but subsection 6's provision to determine the primary aggressor might be difficult to do. He wondered how this will work in the context of an evidentiary hearing. He asked what criteria would be used to make this determination, the strength of the blow, the intensity of the attack? Ms. Kaiser explained this portion was added by the Assembly's judiciary committee based on an already existent Nevada statute which requires responding officers to determine who is the primary aggressor in domestic violence calls. She speculated proof of previous arrests or providing hospital records to documents attacks would be needed for this determination. Senator Adler maintained that in circumstances where there is question as to the primary aggressor, it would be best to "do something with both parties...." The senator proceeded to explain the difference between the situations involving the existing statute and how it would apply in child custody matters. When used by the justices' court the statute works to separate violent parties, but in this bill's provisions it would be used to make an important determination as to the fitness of parents, he explained. Ms. Kaiser noted the provision was suggested by the Washoe Family Court. The assemblyman sponsor noted the original support came from the family court judges in both Washoe and Clark counties. The judges felt the provision should remain in place, and add the evidentiary hearing prior to making any determination as to fitness of the parents, Mr. Batten told. Senator Porter pointed to lines 10 and 11 of page 2 of the bill which sets the standard of proof in the hearings at a level of clear and convincing evidence. This level of proof is the highest in civil matters, he noted. Senator Adler concurred. Senator Washington asked about any fiscal impact caused by a potential increase in caseload to the family courts. Mr. Batten explained none of the judges felt there would be any fiscal impact, that their courts would not be overburdened with the hearings. Senator Adler observed that if the divorce is at a level requiring court decisions on child custody, it is likely it will require a "full-blown" hearing anyway. Senator Washington stated he does not have any problem with the bill, but was simply surprised there was no fiscal note. Lucille Lusk, Lobbyist, Nevada Concerned Citizens, took the floor to voice her concerns about some of the provisions of the bill. She noted she does not oppose the bill, but finds it could result in the violation of the rights of some persons. If the accused is not guilty of the domestic violence which is alleged, is there any presumption created that false accusations should be a basis for losing custody?, she asked. She asked if there is any penalty for a false charge. Senator Adler reiterated the standard of proof required by the bill will address the concerns she brings. A person who falsely accuses another of domestic violence will have their credibility destroyed, and this will go against them in the hearing, he speculated. Ms. Lusk thanked the committee for their time and consideration of her testimony. She moved on. What of instances where both adults are guilty of domestic violence?, she asked. Perhaps it is not in the best interest of the children to remain in the custody of either party, she observed. In this situation, focusing on the primary aggressor seems out of place, she opined. Finally, she turned to the provision dealing with sexual assault within marriage, wondering how it ties in with questions of child custody, especially without evidence of other types of violence or violence against the children. She emphasized she is unable to proffer answers to her questions, but trusts the committee will be careful in its consideration of the bill. Bill Cavagnaro, Lieutenant, Lobbyist, Las Vegas Metropolitan Police Department (METRO), spoke in support of the bill. The department's support for this bill arises from the courts awarding joint custody in families where there is a history of domestic violence. The police department knows that if violence existed in the relationship during the marriage, it will likely occur in situations where the parties must meet to exchange children for visitation, etc. He offered to answer questions. Senator Lee asked the lieutenant how evidence might be gathered for the evidentiary hearing. He wondered if reports are made in instances where a call is received by the police, but upon arrival at the scene it is unclear if violence has occurred, or one party has departed the scene and no arrest is made. He asked if such an instance will be accepted as evidence of domestic violence. The METRO representative was unable to respond to the senator's question from firsthand experience. He explained that in clear cases of domestic violence, the report is made and a party is arrested. In those cases that are not so clear, he assumed the instance would not result in a report being written, but rather it would be considered an "event" which is traceable in the records. In the cases where one party has left the scene, following evident violence, if the party is located within a number of hours, they are arrested, and a report would be written, he added. Senator Washington asked if there are statistics which would show domestic violence calls originate more from married couples, from unmarried couples, from young couples or older couples. The lieutenant could not give an answer directly, but offered to get the information for the senator if it is available. Mr. Batten pointed out the domestic violence has been found to cross all socio-economic and age barriers. There is no pattern to be discerned, he stated. The senator noted his interest arises from a wish to attempt to prevent this violence. Mr. Batten noted the only pattern that is discernable in domestic violence is that it escalates once it has begun. He stated more women are treated in hospital emergency rooms for domestic violence than for any other reason. Senator Porter returned to the concern that both parties might be guilty of violence. He asked if there should be something in place to require counseling for the parties. Mr. Batten opined this aspect of the case should be the judge's concern. It is in his purview to determine the truth and depth of the allegations of violence, and he is best suited to determine what the best recourse is. The discussion moved to section 2 of the bill, which addresses the issue of sexual assault, and Senator Porter asked how it can be proved a child is conceived as a result of sexual assault. Mr. Batten observed in his experience in law enforcement, there are children conceived as a result of rape. He admitted he has never followed a case to a point where the accused might come and petition for custody of that child. It is his goal to ensure that such a situation will not arise. There was some confusion as to the applicability of the section in cases of marital rape. Senator Porter felt the section applied in these cases. Mr. Batten countered there is no way to make provisions in the bill for every case scenario that might be imagined over time. Even if it was possible, he observed, the next review of the bill would raise even more questions, and result in even further suggested changes. He asserted the bill is good as written; that it has been reviewed by four different judges, all of whom agree it is a good bill. He emphasized the support of the judges is important, and their experience as judges will provide safeguards against misapplication of the law. Senator Porter noted the committee hearings are a part of the fail-safe procedure which is designed to ensure the very best laws are made. He opined it is important to be clear and concise in the laws to avoid misunderstanding and misapplications. Mr. Batten opined the judges' experience allows them to use discretion to determine the aspects that possibly were overlooked by the Legislature. This is an important tool, he declared. Lt. Cavagnaro pointed out the bill requires the individual be convicted of the sexual assault in order to fall under the rebuttable presumption of the bill. This provides a bright line test to be applied in each case. Senator Washington interjected that if an individual is convicted of sexual assault, they are sent to prison, and, he speculated, their parental rights would be terminated. This did not appear to be the case, as indicated by the reaction from those in the audience. Senator Adler told there is a specific statute, passed during the previous session, which deals with custody issues in cases of sexual assault. Senator Washington asked for confirmation that the provision in the instant bill is a restatement of already existing law. Senator Adler confirmed this understanding. Phil Galeoto, Lieutenant, Lobbyist, City of Reno, Reno Police Department, testified in "wholehearted" support of the bill. The Reno Police Department finds the bill to be a necessary step in the approach to "best interest of the child" legislation in Nevada, he stated. He offered an example of a situation where there is an extended separation between the married parents of a child. There might be a custody battle going on which results in additional "dynamic" fluctuating within that situation, he speculated. The male might be someone who physically and sexually abused the wife during the marriage, he told. During the separation, when the parties are not supposed to be together, the male forces himself on the wife, raping her. A child could be conceived in this act, and the male might attempt to sue for custody of his child, Lt. Galeoto offered. This is the type of scenario that might be covered under the provisions of section 2 of the bill, he said. There is one other issue he wishes to address, Lt. Galeoto stated. On lines 10 and 11 of page 2 of the bill (subsection 5), the language requiring clear and convincing evidence assuaged any fears or reluctance he felt regarding the bill, he said. Laws such as this one, the witness opined, will push the level of interest and professionalism of the law enforcement agencies in Nevada in the area of domestic violence. This is occurring even now, he noted, but needs to be stimulated further, by legislation such as this. Once again Senator Washington asked about possible patterns for prevention of domestic violence. Lt. Galeoto replied it is his observation that domestic violence cuts across all strata of society without concern for age, marital status, race or ethnicity. The only sure thing is that it does occur, the lieutenant stated, and this bill addresses the best interest of the child in such cases. Assemblyman David E. Humke took the floor to speak in support of the bill. He noted initially he was concerned about the trend to deny fathers custody simply because it is commonly held that mothers are the best parent. He feared, the assemblyman noted, this bill would prove to be another tool used to further gender discrimination in this area. With the addition of the highest civil standard of proof and the requirement for a full evidentiary hearing, these fears were diminished, he noted. In his own legal practice dealing with family law, Mr. Humke explained, he has observed a good attorney will provide every shred of evidence available including temporary restraining orders, hospital records, police reports, etc. On line 27 of page 2, the courts' requirement to consider all previous acts of domestic violence involving either party is read by the assemblyman to mean even in other relationships involving other parties. If a person has been in prior relationships where there are allegations of violence perpetrated by that person, it is significant for a court to know. Taking an optimistic view of this type of proceeding, Mr. Humke noted, a perpetrator of domestic violence will still be allowed visitation rights to his children, even if custody is awarded to the other parent. This bill even addresses that potentiality in requiring the court to make arrangements that will protect the other party from violence when carrying out the visitation. There were no further questions or witnesses, and the hearing on A.B. 395 was closed. ASSEMBLY BILL 302: Makes best interest of child determining factor in cases concerning termination of parental rights. The next bill to be heard was A.B. 302. Assemblyman Humke sponsored this bill and he addressed the committee to explain the intent of the bill. Mr. Humke noted the bill was presented to him by a family court judge in Clark County, Judge Scott Jordan. The bill is intended to be "a simple bill for a complicated proceeding," Mr. Humke stated, by changing state law and policy to provide the placement of primary consideration on the child in a termination of parental rights proceeding. It is the intention to first consider the best interests of the child, and then, secondarily to the fault of the person whose rights are being terminated. John Sarb, Administrator, Division of Child and Family Services, Department of Human Resources, and Nancy Angres, Chief Deputy, Human Resources Section, Office of the Attorney General, spoke in support of the bill. Mr. Sarb noted A.B. 302 is a very important bill to the Division of Child and Family Services. The issue of the termination of parental rights is a very serious matter and has been likened to the "civil death penalty," he told. Fortunately, it is also a matter taken very seriously by the courts and the division, he reported. Because of the interpretation of existing case law by some judges, society is faced with a situation where children and their circumstances are placed in a secondary position after consideration of the fitness of the parents in termination of parental rights hearings, Mr. Sarb asserted. The hearing is bifurcated and heard in two separate parts, first the fitness of the parents is considered, secondly and separately, the child's circumstances are considered. This bill will allow the court to examine the circumstances in the family and the interests of the child alongside "the behavior of the parents," he explained. The evaluation made in this setting will result in a decision based on the best interests of the child, he opined. The division has over 800 children who have been in the custody of the state in foster care for over 18 months, Mr. Sarb told the committee. While not all of them are subject to the provisions of the bill, there are frequent occasions where a child comes into the state's custody for abuse or neglect and the parents make only token efforts to contact and check on the child, he said. The parents do not comply with the requirements set by the court as conditions of regaining custody of their children. The courts will allow the state to retain custody of the child in these situations, Mr. Sarb reported, but they will rarely allow the termination of parental rights. This, he said, results in a child spending "their infancy" in foster care and they are denied an opportunity to be placed in a permanent home and to be adopted by loving and caring families. Additionally, there is currently nothing in the law that makes the parents affirmatively assume their parental responsibilities or face further sanctions, he asserted. A.B. 302 is expected to assist the division in these areas, and the witness urged the committee to support the bill. Senator Adler told of his experiences in Carson City, where parents put their children in "permanent" foster care. Other families express the desire to adopt these children, he noted, but the parents insist they are desirous of keeping the parental rights. As a result, the child is held in a state of limbo, without any real expectation of having a family life of their own, he opined. Mr. Sarb agreed with this representation and explained the number of children in this situation is increasing. Senator McGinness referred to the deletions of language as outlined in the bill (line 7-8, page 1). He noted new language is inserted to replace the deletions and asked what the real difference was, what nuances were expressed by the change. Ms. Angres responded to the senator's question by explaining the change in the language is intended to make it very clear the primary consideration for the court is the best interest of the child. She agreed it may not appear to be a significant change in the proposed language, but noted the courts who decide these matters interpret the old language to require deciding the fitness of the parents prior to any other consideration. The amendment will allow the courts to consider the best interests of the child at the same time they will be considering the other issues. Senator Porter, noting his ignorance of the contents of Nevada Revised Statutes (NRS)128.105-128.109, he asked if there are clear definitions for the items listed in section 1, subsection 2 (e.g., abandonment of the child; neglect; unfitness of parent, etc.). Ms. Angres replied the statutes do include definitions of these conditions. He asked specifically about line 21, which refers to [token efforts] to support or communicate with the child. The senator wondered if this is fairly common in parent-child relationships. Ms. Angres noted this condition falls under the token efforts section. The parent has not abandoned the child, because they have not met the 6-month time period of no contact, she explained, but they have only contacted the child once in 2 or 3 months, or they pay partial child support periodically. These are considered token efforts, Ms. Angres noted, and only one of the conditions would have to be proven (lines 14-20) to establish grounds to terminate the parental rights. Ms. Angres told the committee it is common for the division to have parents who are willing to put their children in foster care in order to allow the state to raise and provide for them. However, as soon as efforts are made by the state to place the child permanently with another family, to terminate the parental rights, they will "jump up and say, `wait a minute, that's my kid, you can't do that to me.'" These people do not want to take the responsibility and make the efforts necessary to be good parents. The bill will help the division to set the children free and allow them to be placed in good homes, permanently, she observed, "because the state makes a very poor substitute for a parent." Ms. Lusk took the floor in support of the bill, noting the issues related to it have been fairly considered and addressed. The amendments made to the bill, she noted, have resolved any concerns the group may have expressed earlier in the session. Lt. Galeoto also took the floor to support the bill. He explained he attended a conference with many of the judges in the state, which focused on domestic violence. During the conference, he noted, there were discussions with the judges about how the issue of domestic violence could be addressed effectively, especially when the violence involved children. The result of these discussions was a consensus that the courts should move from considering the best interest of the parent to the best interest of the child, he told. Thus, the Reno Police Department supports this legislation, Lt. Galeoto emphasized. There was no further testimony and the hearing on A.B. 302 was closed. At this point, Senator Porter passed the gavel to Senator James who had joined the hearing. The chairman opened the hearing on the next bill. SENATE BILL 435: Provides that certain persons arrested must be tested for exposure to human immunodeficiency virus and provides penalty for violating certain local ordinances after testing positive. Chairman James called the bill's requesters to come and explain the reasoning behind this legislation. Lt. Cavagnaro came to the stand with William Young, Lieutenant, Vice/Narcotics Bureau, Las Vegas Metropolitan Police Department. Lt. Young testified in support of S.B. 435 offering the committee some personal background information. He noted he has extensive experience in the vice and prostitution investigations. Lt. Young noted that NRS 201.354 gives the authority to test persons arrested for soliciting prostitution for the Human Immunodeficiency Virus (HIV). METRO started testing all prostitutes arrested in Clark County upon passage of the law, he explained, and to-date there are 202 working prostitutes in the county that carry the acquired immunodeficiency syndrome (AIDS) virus. There have been approximately 20 arrests made under the felony charges allowed by the statute, Lt. Young remarked. This law will allow METRO to test persons arrested for the charge of loitering for the purpose of soliciting prostitution, the lieutenant continued. The difference between soliciting and loitering to solicit was explained by the witness. In soliciting, he said, the office must "actually cut a deal with the prostitute," but the loitering charge allows a police officer who has personal knowledge the individual is a working prostitute to arrest that individual for activities that can reasonably be assumed to lead to a prostitution transaction (e.g., hailing cars from the curb, engaging people in conversations in lobbies of hotels or in casinos). Lt. Young offered an illustration of the kind of situation in which bill would be most useful. He explained that many of the working prostitutes are familiar with the officers on the vice patrol. Thus, after being arrested once, they are able to avoid actually soliciting these officers for acts of prostitution. Those that are arrested and test positive for HIV are very difficult to rearrest and charge under the felony statute. If the officer can make an arrest for loitering for purposes of soliciting prostitution and test the arrestee for HIV, there should be more HIV-positive prostitutes charged with felonies and sent to prison, he explained. This will reduce the number of HIV-positive prostitutes on the streets, he testified, and subsequently, a reduction in the deadly risk to tourists and others who patronize these individuals. Senator Adler commented jokingly the local ordinance to criminalize prostitution in Clark County has not been too effective. Lt. Young agreed. Senator Adler suggested there should be some type of registration or control system for the prostitutes who work in Las Vegas. The witness stated the situation has greatly improved, despite appearances or inferences made from his testimony. Prostitution does impact the tourist industry in the metropolitan area, but the police department does its best, given the laws that exist, he asserted. Because most prostitution arrests are for misdemeanor charges, and with the overcrowding in the jail, it is virtually impossible to make an impression on the prostitute, Lt. Young, testified. Generally, the arrested individual is given a $100 fine and released, which makes virtually no impact, he added. However, with the implementation of AIDS testing upon arrest, of the 202 HIV-positive prostitutes picked up, only about 50 remain in the area, the officer noted. There is a big difference between a $100 fine and going to prison, he opined, and the prostitutes appreciate the difference. The bill focuses severe penalties on the most serious form of prostitution, the kind that can kill people through infection with HIV, Lt. Young stated. Senator Adler stated he supports the bill, but opined there is a need for additional safeguards. The witness agreed with the senator and offered to discuss the matter further, at any time. Senator Titus attempted to clarify her understanding of the intent of the bill. She summarized the bill as a means to test everyone arrested for loitering for purposes of prostitution. Lt. Young concurred, noting currently it is possible to test anyone arrested for soliciting for prostitution. The bill would allow those arrested for loitering for the purposes of prostitution to be tested. If they test positive and are properly notified of the positive results of the test, any subsequent arrest for prostitution of loitering for purposes of prostitution would allow a felony charge. Senator Titus reiterated the language of the bill, noting it says "must submit" to the test. The witness explained the department does not test every time an individual is arrested because some are arrested frequently, and a test every 6 months is most practical. If it is the first time the individual is arrested on a prostitution- related charge, they will be tested, he observed. Senator Titus pointed out the bill says they must be tested, plus pay $100 for that test. Lt. Young asserted the current policy at METRO is not to charge for the test, noting the department spends approximately $5,000 per year for AIDS testing. Senator Titus wondered if the proposed law might be used to harass people who are not really doing anything illegal, but who the officer might have a grudge against, for example. Lt. Young emphasized there is a difference between the charge of simple loitering and loitering for purposes of prostitution. In the case of loitering for the purposes of prostitution, the individual arrested must be a known prostitute, he explained. The senator insisted the bill does not make this clear and asked the witness to explain how the situation is assessed to know if loitering for the purposes of prostitution is applicable. He did so, noting the charge requires the officer have personal knowledge the individual is a prostitute; observing actions that lead the reasonable officer to suspect there is solicitation going on; and an interview with the solicited individual wherein the "customer" admits the solicitation occurred. This explanation proffered, the senator was satisfied. Lt. Young stressed the officers must be very careful and very sure of the situation before a loitering arrest can be made. He noted he was the subject of a suit charging false arrest for a loitering charge. He pointed out that good police work saw the suit dismissed. In any case, it is very important that officer have his evidence before making this particular arrest, he asserted. The chair commented that he too is concerned about the possibility of creating a tool for harassment. However, the greater change is making loitering a felony with 1-20 year prison term. The witness emphasized this is only in the case of an individual with the HIV virus who has been lawfully notified of the condition. Senator James asserted a loitering statute must be "narrowly construed" in order to avoid potential constitutional challenges. He opined citizens should be able to "go wherever [they] want, and stand wherever [they] want, and do whatever [they] want" in this free society. Senator James worried the bill covers a "nebulous area" which might result in a 1- 20 prison term for loitering. The lieutenant defended the bill by pointing out METRO has, as a matter of policy, eliminated all simple loitering arrests. Police officers do not arrest transients or homeless people on the street, because the department has decided it is no longer feasible to enforce the loitering law, except in the case of loitering for purposes of prostitution. Lt. Young explained the chairman's safeguard lies in the fact that the only officers making this kind of arrest are vice officers who are specially trained to recognize the activities that go along with prostitution. Additionally, police officers are held responsible for "bad arrests" and a case can easily be thrown out of court, if evidence is lacking, he stressed, especially with the familiarity the judges have with the prostitutes in the area. Senator James asserted the penalty is too stiff for loitering. The witness noted it is the same penalty as provided for soliciting. Senator James insisted there is a clear difference, because soliciting requires direct interaction with the police officer. He asked the witness where the elements of the crime are set out. Lt Young reported they are in the city and county codes. According to the witness the elements of loitering for purposes of prostitution are: knowledge by the police officer that the individual is a prostitute; and overt actions that would lead a reasonable person to believe the individual is working as a prostitute. The officer is then required to stop both parties, the suspect and the "customer," to ascertain that the conversation was about prostitution, and to allow the suspect the opportunity to explain the purpose for the conversation. Senator James thanked the officer for his testimony and patience, reminding him the Legislature is charged with creating a "government of laws and not of men." It is not possible to rely on the good faith of law enforcement, but it is necessary to ensure the citizens' freedoms are protected. Senator Lee noted with the increased availability and use of video cameras, it is incumbent on police officers of today to behave prudently in their official duties. Additionally, some attorneys are known to provide their clients with advice about avoiding detection by police officers when carrying out questionable activities, the senator asserted. Because of these developments, along with the lethal aspect of the AIDS epidemic this bill is a sound move, Senator Lee opined. There were no further questions and the witnesses stepped down. Randall Todd, Dr. PH, State Epidemiologist, addressed the committee. He provided a copy of his prepared testimony, which is attached as Exhibit F. Dr. Todd proposed an amendment to the bill in section 3, line 46, as offered in Exhibit F in the last paragraph. He offered to answer questions. The chairman asked the witness to provide a written copy of his proposed amendment, and the witness agreed. Senator Lee asked the chairman if there would be an impact to the workmen's compensation system or if the language in the bill would put the officers outside the "scope" of this system. Senator James asked the research assistant to look into this question. George W.T. Flint, Lobbyist, Executive Director, Nevada Brothel Association, spoke next. He noted the brothel association had supported this legislation in 1987 when the original proposal was brought to the committee. Mr. Flint noted the 202 prostitutes in Nevada that have tested positive for the HIV virus were not any of those who work in the legal brothels in the state. For the record, Mr. Flint voiced the concern that legal, licensed prostitutes might be subjected to some form of harrassment during their daily life, while not working. The prostitutes are known to law enforcement and might conceivably be subject to arrest while they carry out the activities of daily life in a community. Mr. Flint noted it is unlikely, but possible. He promised to bring any such instances to the attention of the Legislature, should they occur. Senator Adler wondered if it would be possible to require a person who has been arrested for prostitution to undergo subsequent HIV testing during the following year, as a condition of their penalty. Lt. Cavagnaro opined it might be a good idea, but he could not visualize the tracking system which would be required. Dr. Todd pointed out it is only necessary to test at exposure, at 6-weeks after exposure, and again at 6 months after exposure, in order to cover the incubation window of the virus. Tests at any other interval would be a waste of resources, he stated. Madelyn Shipman, Assistant District Attorney, Washoe County District Attorney's Office, addressed the committee in support of the bill, on behalf of the Nevada District Attorneys Association as well as the League of Cities. The aspect most attractive to the Nevada District Attorneys Association is the notification to the arresting officer or witnesses. Currently, the results are only released to the victim of the crime and to the perpetrator. This change is a welcome change, she stated, as many people are concerned about exposure to the virus. Senator James noted there is supposed to be a fiscal impact, but no fiscal note is attached to the bill. Ms. Shipman replied the fee that will be charged for the test should be sufficient to cover the cost. There was no further testimony and the chairman closed the hearing. The senator turned the hearing to progress on other bills. SENATE BILL 462: Makes various changes to provisions governing corporations and other business associations. Senator James stated did not recall anyone pointing out that S.B. 462 would require anyone who wishes to make a loan in Nevada and has to qualify to do business under NRS 80.010 would have to go through the chapter 645B licensing requirements. Senator James asked if he is incorrect in his understanding of this provision. John P. Fowler, Chairman, Executive Committee, Business Law Section, Nevada State Bar, responded. He noted he examined the bill, after the chairman asked him about it. Mr. Fowler explained his reading of the language, pointing out that NRS 80.015 is an exemption which allows some businesses to avoid licensing in Nevada, if they only do specific things. Subsection 3 of this current statute says a person who is doing business in Nevada within the exemption does not have to qualifiy with the secretary of state, nor does he or she have to get a license from the Division of Financial Institutions to be a bank or other financial institution. The new language, as incorporated in subsection 4, does not require that every business that is a financial institution must be licensed with the state, but it does say "if you are not required to qualifiy to do business under [NRS] 80.015, in other words you're exempted, but you go ahead and qualify, anyway, then you're subject to being licensed by the financial institutions division [under] the financial institution's chapters," Mr. Fowler explained. Therefore, if a business is exempt, but chooses to qualify anyway, the business is subject to regulation by the financial institutions division. The witness admitted he had missed the "fine nuance" before the chairman pointed it out, but he referred the explanation to Dale A.R. Erquiaga, Chief Deputy, Office of the Secretary of State. Mr. Erquiaga voiced his appreciation to the chairman and stated it is not the intention of the secretary of state to "try and move something by the committee." The change was characterized to the secretary of state by the financial institutions division, who requested the language, is exactly as characterized by Mr. Fowler. There is not wish to eliminate the exemption or to require some new registration, but rather to... get at a specific issue of out-of-state banks who do choose to qualify, so they have a little piece of paper which says they are a Nevada corporation, and then they market themselves for other purposes in this state without having been cleared by financial institutions. In the opinion of the secretary of state, it is not a major change, Mr. Erquiaga stated. He referred to Douglas Walther, Senior Deputy Attorney General, Division of Financial Institutions, Office of the Attorney General. Mr. Walther agreed the previous witnesses were correct. There are companies which are exempt under NRS 80.015, but who voluntarily qualify under NRS 80.010 as a foreign corporation. They then market themselves as qualified to do business in Nevada. Because the public does not really understand that "qualified to do business" means only that the entity has registered with the secretary of state, but is not necessarily licensed or regulated by a state agency, he explained. It was the intent to withdraw the exemption for those companies that come in and qualify simply to use it as a marketing tool. If the company represents themselves as qualified, the division feels they should have the commitment of coming forth for licensing, Mr. Walther stated. Senator James asked what companies have voluntarily qualified. Mr. Walther could not say, but speculated it has occurred sufficiently to require address in the statute. Senator James noted his concern lies in large companies from other states who are only interested in one particular transaction and who qualify under the exemption. If these companies are required to go through an extensive process to be licensed they will take their investment money elsewhere, he opined. Mr. Walther reassured the chairman that is not the intent at all to affect the exemption under NRS 80.015. This wording is only targeted at the few instances where the company voluntarily qualifies and then uses the qualification strictly as a marketing tool. Senator James asked for a closer examination of this wording to ensure there will be no impact except as explained by Mr. Fowler, Mr. Erquiaga, and Mr. Walther. Mr. Walther admitted the language, as written, is not self-evident. He agreed to attempt to clarify the meaning. SENATE BILL 433: Makes various changes relating to corporations, limited-liability companies and partnerships. Next, the chairman asked Mr. Fowler to address concerns brought forward by Mike Kearney. Mr. Kearney, the chairman reported, was going to fax his concerns to the senator's attention, but they have not arrived. There are some specifics left out of S.B. 433 which Mr. Kearney is "panicked" about. Also, on the merger statute, there has been a question raised about how the merger statute works with respect to limited-liability companies, Senator James said. In a corporation that merges, the minority receives a pro rata amount of stock in the newly formed company. In a limited-liability company, when there is a division of profits, the current wording would allow the formation of a new limited- liability company which could absorb the assets, rewriting the equity and profits shares in the new company. This is a concern, he said, with the only safeguard being dissenters' rights. Mr. Fowler promised to call Mr. Kearney directly in order to ascertain the concerns and how to address them. Senator James apologized for the delay to the bills, and asked Mr. Fowler to see him personally when he has contacted Mr. Kearney. Mr. Fowler agreed. There was no more business before the committee and the hearing adjourned at 10:25 a.m. RESPECTFULLY SUBMITTED: Lori M. Story, Committee Secretary APPROVED BY: Senator Mark A. James, Chairman DATE: Senate Committee on Judiciary May 19, 1995 Page