MINUTES OF THE SENATE COMMITTEE ON JUDICIARY Sixty-eighth Session May 25, 1995 The Senate Committee on Judiciary was called to order by chairman Mark A. James, at 8:00 a.m., on Thursday, May 25, 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 Joseph E. Dini, Jr. Assemblyman Brian E. Sandoval STAFF MEMBERS PRESENT: Allison Combs, Senior Research Analyst Lori M. Story, Committee Secretary OTHERS PRESENT: Lucille Lusk, Lobbyist, Nevada Concerned Citizens John W. Riggs, Sr., Concerned Citizen Bill Cavagnaro, Lieutenant, Lobbyist, Las Vegas Metropolitan Police Department Phil Galeoto, Lieutenant, Lobbyist, City of Reno, Reno Police Department Margaret Springgate, Legal Counsel, Governor's Office Greg Harwell, Lobbyist, California State Automobile Association John P. Fowler, Chairman, Executive Committee, Business Law Section, Nevada State Bar ASSEMBLY BILL 396: Restricts granting of probation to persons convicted of certain sexual offenses involving children. The hearing opened with a subcommittee consisting of the chairman and Senator Lee. The chairman opened the hearing on Assembly Bill (A.B.) 396 and Assemblyman Brian E. Sandoval presented his testimony. Mr. Sandoval is the prime sponsor of the bill and he told the committee the intent of the bill. Mr. Sandoval referred to statistics about persons who prey on children and emphasized the recidivism rate for sexual deviants is 95 percent; one deviant can have as many as 300-400 victims; and, typically, the victim is between 3 and 5 years of age. In discussions with prosecutors the assemblyman reported, it was revealed that in some cases crimes such as sexual assault on a child is negotiated down to a charge of attempted sexual assault. This crime is currently probationable, he noted. He observed that probation for such individuals is rare, but it has happened. Therefore, the bill focuses on this loophole, making anyone who is convicted of attempting or completing an act of sexual assault on a child under 16 years serve their sentence in prison, not on probation, the legislator told. At this point Senator James noted the presence of a quorum of the entire committee and the hearing proceeded. He asked for questions. Mr. Sandoval recalled a bill sponsored by Senator Rawson, which is similar in nature, and may, he noted, contain a "redundant provision." Mr. Sandoval reported he had talked with the senator, and he represented the senator does not object to A.B. 396 proceeding to passage. SENATE BILL 192: Makes various changes related to provisions pertaining to sexual deviants. Senator James clarified that Senator Rawson's bill called for no probation at all for any sex offense. The senator judiciary committee had amended the senator's bill to apply only to the sex offenses that were also covered under Senate Bill (S.B.) 192. The bill was then passed out of committee, the chairman explained, with the same provisions as are contained in A.B. 396. Senator James observed that since the committee has endorsed the concept contained in the bill, it will proceed out of committee, unless the assemblyman has any changes to propose. Mr. Sandoval opined the bill is "perfect, [as] it is," but he welcomed the committee's insight for improvement. Senator McGinness asked the witness why the age of 16 was chosen. Mr. Sandoval noted the original draft of the bill called for a child under the age of 14, but the Assembly judiciary committee amended it in an attempt to draw consistency with other bills, including S.B. 192. There were no further questions, and the assemblyman stepped down. Lucille Lusk, Lobbyist, Nevada Concerned Citizens spoke next in support of the bill. She stated she would not repeat statistics, but the support arises for reasons frequently voiced in previous hearings. She stated she wishes the record to show this support. Senator James asked Ms. Lusk if she had testified in support of Senator Rawson's "no probation' bill. Ms. Lusk could not recall specifically, but speculated she had. There was no further testimony on A.B. 396 and the chairman closed the hearing. Next, hearing on A.B. 393 was opened. ASSEMBLY BILL 393: Makes various changes related to possession of firearm by children and increases penalty for sale of certain firearms to children. Assemblyman Joseph E. Dini, Jr., addressed the committee introducing Margaret Springgate, General Counsel, Governor's Office. Mr. Dini explained the bill is a combination of efforts, including those of Ms. Springgate, the National Rifle Association (NRA) and himself. He opined the Assembly judiciary committee produced a good product in the version before the Senate. The goal of the bill is to balance the rights of the gun owner with law enforcement's need to address the concerns arising from youth's gang and gun activity. Mr. Dini gave an overview of the bill, providing a copy of his remarks for the record (Exhibit C). He offered to answer any questions the committee might have. Senator James asked about section 6's liability provision, noting it appears to "track the common law" on the question of negligent or reckless entrustment to someone who has the propensity to commit a crime, rather than providing strict liability for the parents. Ms. Springgate agreed with the senator, noting under current law, even if a parent does not know what the child is doing, they can be held liable if the child engages in willful misconduct. This strict liability carries a cap of $50,000, she explained. This bill makes for a more direct liability on the parents and removes any cap or restrictions on the amount, she continued. Therefore, if the parents are aware of delinquent activities of their children, they can still give permission for the child to have and use firearms, but they will be held liable for the child's misconduct or negligence. Senator McGinness asked Mr. Dini if sections 12 and 22 would prohibit a "youngster" from going out to Mason Valley or Lahontan Valley to hunt ducks after school. Mr. Dini answered it is his understanding the youths could still do this activity, as long as they have their parents' permission. Mr. Dini reiterated the approval and support of the NRA for this version of the bill. He submitted a copy of a letter from the organization voicing their support (Exhibit D). Senator James opined with the NRA's vigilance, if a bill addressing gun issues does not draw one of their representatives, the group must be fairly comfortable with its provisions. Senator Washington asked the witnesses how the definition of a firearm in section 9 of the bill was arrived at, noting there is a deletion of air powered firearms, such as BB guns. Ms. Springgate concurred, noting there was a specific exclusion of BB guns from the provisions of section 9, which deals with a child carrying a weapon being a violation of the law. In section 10, however, she noted, BB guns are specifically included in the prohibition of carrying firearms onto school grounds. Bill Cavagnaro, Lieutenant, Lobbyist, Las Vegas Metropolitan Police Department (METRO), came to the witness table and spoke in support of the bill. The lieutenant told the committee to imagine a car driving on an urban street, carrying four apparent juveniles, late at night. The local police stop the car and find a loaded weapon in the vehicle, he continued. Currently, there is nothing the police can do with this vehicle full of youths and firearms, he told the committee, and it is a drive-by shooting waiting to happen. METRO believes the bill will allow them to take further action to remove the weapon from the vehicle, and possibly prevent a violent act. Senator Washington asked the lieutenant how often a situation like he described is actually encountered. The officer stated it happens frequently, but he is unable to provide a number. Lt. Cavagnaro explained in one of his previous assignments he worked with releases of impounded weapons. While the right for police to impound weapons is somewhat questionable, it is done sometimes, anyway, the lieutenant told. From that perspective, these situations arise quite frequently, as many as 10 to 15 weapons a night on a weekend, he reported. Senator Washington asked if the types of weapons found in the vehicles in the urban areas are different from those that might be found in the rural areas. Lt. Cavagnaro opined the weapons are very different, with mostly "high-end" pistols, semiautomatic assault weapons being found in the urban vehicles. The senator referred to the provision that makes parents liable for the actions of their children, and asked if the lieutenant thought the parents of the juveniles involved in drive-by shootings would be easily located and brought to answer. He opined that most the parents of such youth are either difficult to locate or, even worse, apathetic and uncaring. The police officer agreed, but said he felt the provision at least gives the police a place to start to encourage accountability. Phil Galeoto, Lieutenant, Lobbyist, City of Reno, Reno Police Department, spoke next, also in support of the bill. It plugs "a few of the holes" that exist in law enforcement's ability to deal with the increased violence with youth in the cities. The lieutenant told the committee that summer is "drive-by shooting season" in northern Nevada. With the nice weather more youth are out and around the city, engaging in mischief, he reported. The chairman asked if these things happen more in the summer. The witness concurred, adding the cold weather in the north keeps even criminals indoors. Lt. Galeoto voiced particular support for the provisions that allow parental responsibility, along with the judicial discretion allowed in that area. The bill provides the judge with tools to impact the family situation with counseling and other means. Finally, the witness referred to page 5, lines 47-48 of the bill, which refers to a loaded weapon. He explained in the case of a semiautomatic weapon, it is loaded if there is a cartridge in the magazine and the magazine is in the firearm. This is different than simply requiring that a cartridge be in the chamber, he explained, with the vast majority of youth today opting for these semiautomatic weapons. Ms. Springgate returned to the stand to propose an amendment to the bill. On page 5, lines 47-48, she told, the intent of the bill is the weapon would be considered loaded if the cartridge is in the magazine, the magazine is in the firearm, and the firearm is a semiautomatic weapon. The gun is not loaded if the magazine is in the glove compartment and the gun is in the trunk of the car. She suggested that language be included on lines 47 and 48, page 5, as well as lines 18 and 19 on page 9, which says the magazine must be in the firearm in order for the firearm to be loaded. The chairman asked the police officers present to explain to him and those in the audience and on the committee, the various aspects of a semiautomatic weapon and how it is loaded. This was accomplished with some difficulty, considering the chairman's lack of experience with firearms. Ms. Lusk spoke in opposition to the bill. She presented and read to the committee a letter drafted by her husband, Jerry Lusk. The letter is incorporated as Exhibit E. Ms. Lusk then added some comments of her own. She stated she has attempted to remain removed from the philosophical discussions of the issue. She noted it became apparent to her early in the legislative session that older teenagers would suffer some restrictions and their drivers' licenses would be the means applied to punish those teens who violate the law, no matter how little the license was connected to the offense committed. Rather than become embroiled in these discussions, Ms. Lusk stated, she attempted to propose amendments to these bills to provide protection for hunting and sports. The bills have been vastly improved since their initial introductions, she opined. Every time she returns to Las Vegas, she told, she is accosted by parties who are opposed to these measures. While the media reports do not accurately or totally reflect the actions of the Legislature and people's opinions are not always based on true fact, the backlash from these reports is increasing, she said. The fact that her husband took the time to write a letter to his state representatives is an indication of the breadth to which these issues can be felt. A.B. 393, despite the positive amendments, fails to address a significant principle, Ms. Lusk opined. The principle is that of criminalizing actions that are not inherently wrong, she stated. She emphasized the possession of a firearm is "not an act that a person of sound mind and good conscience would know to be inherently evil." Senator James tried to pinpoint the section of the bill Ms. Lusk most strongly objects to. He asked if section 12 was the portion she was focusing on, noting that current law holds that children under 14 cannot lawfully possess a firearm unless accompanied by an adult. The change increases the age to under 18, as well as delineating circumstances which would allow the lawful possession of firearms by younger people. Ms. Lusk agreed that at ages less than 14, it is easy to believe a young person might not have the maturity to handle a firearm, but 16 and 17-year-olds can be found who would be responsible in handling firearms. Senator James referred to other pieces of legislation dealing with similar issues, noting they attempt to set out reasons why young people in the 14 to 18 year age group would and could have firearms in their possession, and activities that are positive and healthy which involve firearms. However, these bills also set out the understanding that there is no reason for a young person to have a machine gun or semiautomatic weapon, even for those activities understood to be good and wholesome. He observed there is an attempt to protect some of the activities that are considered to be acceptable, while criminalizing others. Ms. Lusk stated the bill impresses her as well. She admitted she is unable to offer suggestions that would improve it. Ms. Lusk also responded to the comment that there is no reason for a sportsman to have a semiautomatic weapon. She stated it is her own personal weapon of choice when targeting shooting. Senator James stated he had misused the word, and he had meant there is no good reason for a young person to have a fully automatic weapon. The next witness, John W. Riggs, Sr., Concerned Citizen, addressed the committee, noting some technical flaws he has observed. Mr. Riggs noted his membership in the NRA, and stated he did not represent the organization in his testimony. The first technical flaw, he pointed out, is on page 5, lines 47-48, is a contradiction to hunting law which declares a loaded weapon to be one with the cartridge in the chamber, not merely a loaded magazine. He suggested the wording should designate the weapon is loaded if there is a cartridge in the magazine, if the firearm is a semiautomatic pistol. Mr. Riggs went on to attempt to clarify what a cartridge is in "gun speak." The witness noted he is not in conflict with the intent of the bill, but some of the wording causes him concern. There ensued some discussion of the sections of the bill that include BB guns as firearms versus those sections that do not. It was explained the exclusion of BB guns in one section did not affect its inclusion in the section referring to weapons on school grounds. Finally, the witness understood the differences, but opined the bill includes too many contradictions as it is written. The final witness to address the committee on A.B. 393 was Greg Harwell, Lobbyist, California State Automobile Association. Mr. Harwell asked the bill be amended to allow notification of the insurance companies when drivers' licenses are suspended. He provided a proposed amendment (Exhibit F), which he said is identical to that provided at the hearing of another bill addressing graffiti and penalties for that crime. The amendment allows the department of motor vehicles and public Safety (DMV & PS) to report the suspension, but prohibits the insurance company from raising the rates or taking other action because of the suspension. Mr. Harwell noted the amendment was discussed with Mr. Dini and Ms. Springgate, who voiced no opposition. There was no further testimony on A.B. 393, but the chairman took an opportunity to go over various provisions in the bill in order ascertain their application. He summarized the intent of the bill to draw the prohibition broadly and then to define the circumstances that are exceptions to the prohibition. He then closed the hearing on the bill. The committee then moved to a work session. SENATE BILL 433: Makes various changes relating to corporations, limited-liability companies and partnerships. SENATE BILL 462: Makes various changes to provisions governing corporations and other business associations. The chairman called John P. Fowler, Chairman, Executive Committee, Business Law Section, Nevada State Bar, who came to the witness table to clarify the changes that have been agreed upon in regard to S.B. 433 and S.B. 462. He offered a copy of a summary of amendments to the bill (Exhibit G) and went over them for the committee. Mr. Fowler told the committee that following a previous work session on the bill, he and representatives from the Office of the Secretary of State and others, communicated in person and by telephone to formulate the changes presented in Exhibit G. The two bills were designed to amend many of the same sections of the Nevada Revised Statutes (NRS), and the discussions mentioned above resulted in a well coordinated product. The witness told the deletions on the amendment summary (Exhibit G) were an attempt to remove the duplicate, but less effective section of one bill in favor of a similar section in the other. The second product of the amendments to the bill was a result of requests made by tax attorneys to make some changes to the limited- liability statutes. The Internal Revenue Service (IRS) has recently issued Revenue Procedure 95-10 (Rev. Proc. 95-10). This procedure impacts the bill for limited-liability companies, he explained, and it is the intention to review this, as well as a uniform limited- liability law proposal and revisit the limited-liability issue next session. However, there are some things that can be done in the current session, in order to allow Nevada's statute to be competitive with limited-liability company statutes in other states. This change, Mr. Fowler explained, relates to the level of voting by which certain basic changes in limited-liability (LL) companies and LL partnerships could be approved by the owners or partners in these respective LL enterprises. These changes are: LL companies (LLC); change the level of voting necessary to approve the admission member (owner); and, the level of approval of the LL company to approve the continuance of the LLC after a dissolution event occurs. The changes are rather technical, Mr. Fowler continued. Senator James asked if the change will deal with the potential problem that a majority owner in a LLC could merge the company into another one and, thereby change the profit distributions inequitably. The witness replied it appears to be better to reduce the threshold of the vote for merger; for continuing an LLC after a dissolution event occurs; and for admitting a new member to an LLC to "majority in interest" as defined by the IRS. This makes it easier than the unanimity previously required. There may be a problem with mergers, the witness observed, if the practitioner who is orchestrating the merger is not well versed in the tax statutes. The chairman restated his question, wondering if there is anything being done to reduce the equity of profit distributions to the minority interest. Mr. Fowler pointed out in the corporate arena, unless publicly owned, there are dissenter's rights. Mr. Fowler referred to merger statutes in other states, noting to his knowledge none of these states have statutory dissenters' rights. Apparently, he reported, LLCs and LL partnerships are creatures of contract, to such an extent, that making dissenters' rights statutory goes beyond this contractual concept. It was thought best to allow the LLCs and LL partnerships a little bit greater flexibility by allowing the thresholds for the major transactions to be set at a majority of interest vote, while still allowing them the tax treatment allowed to partnerships. Senator James asked the witness if the amendments addressed his various concerns, as voiced in previous hearings. Mr. Fowler confirmed that was so. Senator Titus stated this appears to be an area that is very specialized, and well represented by the various agencies in the state and the industry. She observed there are some things that must be left to trust, noting if all those representatives "think this is good" she is willing to trust their expertise. Mr. Fowler stated it is the intent to provide a "bullet-proof" statute so if a company is formed according to statute, they will be protected and provided with partnerships tax treatment. The chairman told the committee he had personally discussed the bill with two other corporate experts in the area and they seems to agree it is a good bill. He asked Mr. Fowler if the proponents dealt with paragraph H on page 10 of the summary of amendments, which deals with the revival of articles of incorporation by officers and directors. Mr. Fowler stated the provision was struck from the bill. The senator also asked about other concerns, particularly section 19 of S.B. 462, which Mr. Fowler explained was also removed. Senator James called for a motion to amend and do pass S.B. 433. SENATOR LEE MOVED TO MOVED TO AMEND AND DO PASS S.B. 433 AS OUTLINED ON EXHIBIT G. SENATOR TITUS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR ADLER WAS ABSENT FOR THE VOTE.) **** The chairman then called for a motion to amend and do pass S.B. 462. SENATOR LEE MOVED TO MOVED TO AMEND AND DO PASS S.B. 462 AS OUTLINED ON EXHIBIT G. SENATOR TITUS SECONDED THE MOTION. THE MOTION CARRIED. (SENATOR ADLER WAS ABSENT FOR THE VOTE.) **** Senator Titus took a moment to explain Senator Adler's absence. She said she was informed his automobile was stolen this morning, and he was attempting to file a police report. Senator James told the committee there are some 20 bills awaiting amendments from the bill drafters. He offered an outline of upcoming business. He asked the senators to keep him informed if they have bills they are waiting to move. SENATE BILL 329: Provides for certification of court interpreters for persons involved in judicial proceedings who speak language other than English. Senator Titus informed the chairman the amendments to S.B. 329 had been returned from the bill drafters and since the committee has already voted on it, she stated she is prepared to take the bill to the floor. The chairman took up A.B. 396 and called for a motion to do pass. SENATOR LEE MOVED TO DO PASS A.B. 396. SENATOR McGINNESS SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. **** Finally, the chairman called for a committee introduction of a bill draft request explaining it is a bill that attempts to circumvent a move by the U.S. Congress to regulate gaming. He had requested it early in the session, he added. BILL DRAFT REQUEST 41-913: Extends board's authority to investigate crimes involving casino patrons under certain circumstances. SENATOR LEE MOVED FOR COMMITTEE INTRODUCTION OF BILL DRAFT REQUEST 41-913. SENATOR PORTER SECONDED THE MOTION. THE MOTION CARRIED UNANIMOUSLY. ***** There was no further business before the committee and the hearing adjourned at 10:05 a.m. RESPECTFULLY SUBMITTED: Lori M. Story, Committee Secretary APPROVED BY: Senator Mark A. James, Chairman DATE: Senate Committee on Judiciary May 25, 1995 Page