MINUTES OF THE
SENATE COMMITTEE ON GOVERNMENT AFFAIRS
Sixty-ninth Session
February 12, 1997
The Senate Committee on Government Affairs was called to order by Chairman Ann O'Connell, at 2:10 p.m., on Wednesday, February 12, 1997, in Room 2143 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 William J. Raggio, Vice Chairman
Senator Jon C. Porter
Senator Raymond C. Shaffer
Senator Dina Titus
Senator Michael A. (Mike) Schneider
COMMITTEE MEMBERS ABSENT:
Senator William R. O’Donnell (Excused)
STAFF MEMBERS PRESENT:
Dana R. Bennett, Committee Policy Analyst
Kim Marsh Guinasso, Committee Counsel
Nancy S. Arnold, Committee Secretary
OTHERS PRESENT:
Darrel R. Daines, State Controller
Ken West, Chief Deputy Controller, Office of the State Controller
John Adkins, Deputy of Cash Management, Office of State Treasurer
Alvin P. Kramer, Treasurer, Carson City
Bob Gagnier, Lobbyist, Executive Director, State of Nevada Employees Association
Georgia J. Rohrs, Acting Director, Office of the Court Administrator
Paul Hickman, Judge, Reno Municipal Court
Marvin A. Leavitt, Lobbyist, Director, Intergovernment/Community Relations and Policy Research, City Manager’s Office, Las Vegas
Stephen George, Deputy City Attorney, Las Vegas
Mary Henderson, Lobbyist, Public Affairs Director, Washoe County
Madelyn Shipman, Assistant District Attorney, Washoe County
Eric S. Cooper, Lobbyist, Washoe County Sheriff’s Office, Nevada Sheriffs and Chiefs Association
Ward Peterson, Constable, Reno Township
John J. Hart, Former Constable, Reno Township
Rod Barbash, Chairman, Legislation Committee, Nevada Collectors Association
John Langon, Constable, Sparks Township
Ralph S. Shamshoian, Property Manager, Edington and Associates, Inc.
Michael Lindell, Concerned Citizen
Stephanie S. Tyler, Lobbyist, City of Sparks
Chairman O’Connell opened the hearing with Senate Bill (S.B.) 43.
SENATE BILL 43: Requires state controller to pay salaries and reimbursement of expenses of certain state employees and officers by electronic transfer of money. (BDR 31-532)
Darrel R. Daines, State Controller, testified in favor of S.B. 43 explaining the purpose of the bill mandates participation of state employees in electronic payment of salaries, expense reimbursements and other compensations. Mr. Daines pointed out with today’s technology counterfeiting and check defalcation has been a concern nationwide, adding it has already occurred in Nevada. He concluded there would be cost reduction for processing and internal control as well as a reduction of risk. He submitted an outline of his testimony with attachments to the committee (Exhibit C).
Senator Raggio inquired whether other states or the federal government were using electronic payment systems.
Mr. Daines replied all states are moving toward electronic checking, but stressed he was not aware of any states who mandate the process. He commented, however, by 1999 the federal government plans to eliminate paper for welfare checks and food stamps by issuing ATM cards and next year Social Security will mandate payment distribution through electronic transfers. He confirmed his office had received notices from 100 federal government agencies who impose electronic payroll.
Senator Raggio commented the bill requires employees to establish whether it is impractical or impossible to utilize electronic deposit. He asked Mr. Daines if he had concerns about the mandatory requirement. Mr. Daines said the state employs people in remote areas and some do not have access to a bank. He added such situations would require flexibility. Senator Raggio asked what would happen if an employee refused to have a bank account. Mr. Daines responded there were ways to address the issue.
Senator Porter remarked he would be more comfortable if exceptions to mandatory transfers were specifically addressed. He inquired what would occur if an employee was overpaid.
Mr. Daines stated exceptions would have been addressed however they could not be identified. He pointed out statute prevents undue hardship on employees when they are inadvertently overpaid; there would be allowance for reasonable amount of time to repay.
Senator Porter inquired would employees be reviewed for termination if they refused to repay and then asked what percentage of state employees use electronic deposit.
Mr. Daines answered there would not be a review for termination and added about 70 percent of all state employees used electronic deposit. He emphasized state time was wasted by physically distributing and depositing payroll.
Senator Porter expressed concern about requiring employees to use electronic deposit.
Senator Raggio asked how employees received notice that their bank accounts had been credited with payroll deposits.
Mr. Daines replied nonnegotiable payroll checks were duplicated on slip paper reflecting payroll information and verification of deposit.
Senator Raggio mentioned judgment debtors could easily garnish employees’ accounts and offered this may be reason employees refuse automatic deposit.
Senator Schneider suggested employees who do not utilize automatic deposit may elect the service when incentives were offered. He asked how much would the state save if all employees were paid electronically.
Ken West, Chief Deputy Controller, Office of the State Controller, said all banks offered free banking incentives and expounded the state saved about $2 per- employee-per-electronic deposit, or about $40 per-year-per-employee.
Chairman O’Connell asked if they were aware of recent problems with Wells Fargo Bank when electronic pension check deposits were not credited to railroad retirees’ bank accounts. She pointed out Congress became involved in solving the problem and asked how a situation like that would be handled.
Mr. West said a similar situation occurred a couple weeks ago, explaining Wells Fargo Bank changed account numbers and in the process several electronic payroll deposits were not credited to correct accounts. He stated his office took immediate action and resolved the problem, adding only two hand-typed checks were issued.
Senator Shaffer asked if there was a $40 savings per-employee-per-year when a nonnegotiable payroll check was issued to employees as well.
Mr. West clarified the primary expenses were handling and check stock costs. He stated nonnegotiable check costs would remain, however there would be overall cost reduction by eliminating handling and check stock costs.
John Adkins, Deputy of Cash Management, Office of State Treasurer, testified in support of S.B. 43 stating electronic transfers were the most efficient method of handling banking transactions, and stressed they are cheaper, faster and safer than issuing printed checks. However, he asserted his office would not state a position concerning mandatory requirement for employees. He said banks have volunteered to market direct deposits to encourage voluntary enrollment.
Mr. Adkins expressed concern with amending chapter 353 of Nevada Revised Statutes (NRS) asserting it belonged in chapter 227 of NRS. He explained distribution of a warrant belongs in the treasurer’s office as law states the controller prepares a warrant and delivers to the treasurer’s office, hence the treasurer would be responsible for delivering warrants in the form of direct deposit method. He concluded the Treasurer’s Office agrees with the controller, but emphasized placement of the amendment in the proper chapter of NRS.
Chairman O’Connell requested Kim Guinasso, Committee Counsel, Legal Division, Legislative Counsel Bureau, to advise what chapter the amendment should apply to.
Ms. Guinasso, replied it would be properly placed in chapter 227 of NRS.
Alvin P. Kramer, Treasurer, Carson City, testified in favor of S.B. 43 stating his office desires implementation of mandatory electronic-payroll deposit, adding it will be impossible to accomplish when it is not mandatory at the state level. He said by year 2000 the federal government will require mandatory electronic- payroll deposit. He shared he had attended seminars concerning government check fraud, adding there are significant liability issues.
Chairman O’Connell questioned how many Carson City employees choose to be paid by electronic deposit.
Mr. Kramer answered about 60 percent, acknowledging employees are satisfied with the convenience of electronic-payroll deposit.
Bob Gagnier, Lobbyist, Executive Director, State of Nevada Employee’s Association, testified against S.B. 43 affirming his organization opposes mandating electronic-payroll deposit because employees are denied their right to choose. He asserted an objection to the mandatory language as outlined in S.B. 43, adding state employees’ choices have been eroded.
There being no further testimony Chairman O’Connell closed the hearing on S.B. 43 and opened the hearing on Senate Bill (S.B.) 47.
SENATE BILL 47: Limits ordinances for which incorporated city may impose civil liability to city instead of criminal sanction for certain violations. (BDR 21-357)
Georgia J. Rohrs, Acting Deputy Director, Office of the Court Administrator, explained the purpose of S.B. 47 would be to narrow the list of offenses which a municipality may decriminalize. Ms. Rohrs stated criminalization of city misdemeanors other than those pursuant to NRS 484.395 through NRS 484.444, which include stopping, standing, parking and minor traffic violations would remain the same. She emphasized there would be negative fiscal impact if all traffic offenses were decriminalized because of the elimination of court assessment fees. She added court assessment fees would not decrease the court’s workload and concluded civil cases require lower standards for burden of proof than criminal cases.
Senator O’Connell pointed out S.B. 47 had been a section of Senate Bill (S.B.) 495 of the Sixty-eighth Session which passed in the Senate during the 1995 session.
SENATE BILL 495 OF THE
SIXTY-EIGHTH SESSION: Makes various changes to provisions governing collection of fines and assessments.
Senator O’Connell stated after reviewing the minutes she did not find reference to the section in S.B. 495 of the Sixty-eighth Session addressed by S.B. 47. She noted the bill was killed in the Assembly and asked if they could provide an explanation.
Paul Hickman, Judge, Reno Municipal Court, answered he did not know the history, and was unaware of S.B. 495 of the Sixty-eighth Session.
Ms. Rohrs replied she also was unaware of S.B. 495 of the Sixty-eighth Session.
Chairman O’Connell directed Ms. Rohrs and Judge Hickman to research the issue, specifically whether the referenced section contributed to the demise of S.B. 495 of the Sixty-eighth Session.
Senator Porter requested the intent of the bill be clarified.
Ms. Rohrs explained traffic misdemeanors pursuant to city ordinances may be decriminalized by municipalities, which results in a maximum fine of $500 payable to the city. She clarified traffic misdemeanors are under the authority of state violations, adding administrative fees are paid to the court on a plea or finding of guilty to a misdemeanor. She said when traffic misdemeanors are reduced by cities, fees are not assessed and the matter would be heard before an administrative hearing officer indicating fines assessed are paid to the city.
Senator Raggio interceded explaining violation cases require administrative fee assessments in addition to a fine, adding the fees fund court budgets, including the municipal and supreme courts. He noted, the amount of revenue raised had significant impact on court budgets as a funding mechanism.
Chairman O’Connell inquired as to the cost of the administrative fee. Ms. Rohrs replied administrative fees are based on the amount of the fine, adding assessments are scheduled from $10 to $100.
Judge Hickman stated parking violations are the only violations decriminalized in Las Vegas, Reno and Carson City. He explained they are heard before an administrative officer, whereby only the defender and administrative officer are present. He expressed concern if other moving violations were decriminalized automobile insurance would be at risk, and inherent protections offered in a criminal matter would be lost, leaving individuals without recourse. He testified police officers would no longer be required to be present at trial, the alleged offender would lose the right to remain silent, as well as the right to confront or cross-examine witnesses. He asserted because the hearing would be of an administrative nature, fault could be easily established, resulting in thousands of dollars of insurance liability.
Senator Raggio asked Judge Hickman if he supported the language of the bill. Judge Hickman answered yes stating parking violations effectively handled as a civil matter alleviates potential liability, there would only be a fine assessed by the city.
Marvin Leavitt, Lobbyist, Director, Intergovernment/Community Relations and Policy Research, City Manager’s Office, Las Vegas, expressed opposition to S.B. 47, and introduced Steve George, Deputy City Attorney, Las Vegas, for further testimony.
Mr. George testified against S.B. 47 stating the bill restricts authority of municipal governments and their ability to effectively regulate and control undesirable behaviors. He pointed out municipal governments possess authority to determine whether certain offenses should be prosecuted criminally or pursued as a civil matter. He explained the burden of proof was substantially higher in criminal cases and often there is lack of evidence to convict, however, municipal governments have the choice of pursuing cases as civil matters. Mr. George asserted administrative hearings free the court’s time to prosecute more important cases, therefore allowing effective administration of justice. In conclusion, he urged the committee to give cities necessary discretion so matters may be handled in a fashion suited to particular facts.
Senator Raggio questioned what instances would a prosecutor pursue offenses as civil liability matters.
Mr. George summarized, generally, the procedure of examining evidence and determining whether a conviction may be obtained when pursued as a criminal case. He stated when evidence is not sufficient enough to meet the burden-of- proof requirement, civil statutes may permit prosecutors to impose civil penalties for certain violations. Specifically he offered an example; a dog-fighting instance where injury occurs on private property, and where there was lack of evidence which dog provoked the conduct, as a criminal matter there would not be prosecution, although as a civil case the property owner could be held responsible.
Mr. Leavitt commented S.B. 47 would have serious effect on the ability to administer building and zoning codes.
Senator Raggio requested Ms. Rohrs provide examples of when and to what extent loss of assessments have occurred. He expressed concern that an attempt to circumvent assessment fees at state and local levels had occurred. He recognized courts relied on assessment fees as a significant source of revenue.
There being no further testimony Chairman O’Connell closed the hearing on S.B.
47 and opened the hearing on Senate Bill (S.B.) 83.
SENATE BILL 83: Authorizes every board of county commissioners in this state to abolish office of constable and appoint sheriff ex officio constable. (BDR 20-681)
Mary Henderson, Lobbyist, Public Affairs Director, Washoe County, testified in favor of S.B. 83, stating the purpose of the bill eliminates a population cap which would permit the Board of County Commissioners to establish an office of constable ordinance. She noted Washoe County is the only county in Nevada that does not have ability to determine if constables are needed in townships, adding Washoe County would be brought into conformance with other counties. She pointed out the bill does not affect elections of the office, it addresses only the office itself. Continuing, she said there are six townships and the county is required to have a constable in each. She said the county’s finance department discovered in smaller constable offices less than 10 papers per month are served, and added this information was supported by a study conducted by the department. She concluded the bill would allow the county to appoint the sheriff as ex officio constable in the various townships.
Senator Raggio queried the method of compensation to constables. Ms. Henderson stated the annual base salary is $10,000, and constables are permitted to retain up to $55,000 in collections, they are required to split all collections over the $55,000 threshold with the county. She explained a total of $156,740 would be paid for staffing constables in Reno and $72,556 in Sparks for the fiscal year.
Senator Raggio requested clarification that the base salary was included in the $55,000, and how 50 percent in collections over $55,000 are reported and collected by the county.
Madelyn Shipman, Assistant District Attorney, Washoe County, testified $55,000 represents combined revenue of a $10,000 base salary and $45,000 net revenue in fees collected. She specified net revenue is defined as the balance after all out-of-pocket expenses, such as salaries for additional staff and deputies not provided by the county, are paid by the constables.
Eric S. Cooper, Lobbyist, Washoe County Sheriff’s Office, and Nevada Sheriffs and Chiefs Association (NSCA), verified his appearance before the committee was on behalf of Washoe County Sheriff Kirkwood who supported S.B. 83. He commented in those counties where constables are appointed, the system has operated smoothly, adding the NSCA also supported the bill.
Senator Raggio suggested concern about quality of service provided by the sheriff’s office. He questioned whether the sheriff could assure competent and efficient service.
Mr. Cooper emphasized budget augmentation for the sheriff’s office would grant the same level of service as provided by the constables.
Ward Peterson, Constable, Reno Township, testified against S.B. 83 stating the bill was an attempt to transfer legislative authority over the office of constable to Washoe County. He continued explaining he was available every hour of the day in an effort to provide efficient service, and asserted unlike the private process their fees are regulated. He concluded by pointing out Assembly Bill (A.B.) 67 would increase sheriff fees.
ASSEMBLY BILL 67: Increases certain fees charged by sheriffs. (BDR 20-549)
Senator Raggio solicited comment concerning the fact constables refused to open their books for audit, inquiring what type of bank accounts are maintained for business purposes. He maintained the office of constable was classified as a public office subject to public audit, including how money is spent.
Mr. Peterson confirmed he provided collection-of-fees records for audit, however he stated the auditors wanted to evaluate how money was spent. He clarified his interpretation of statute was any fees collected became personal money and therefore a personal matter. He emphasized reports concerning fees collected have always been submitted, and acknowledged he maintains two bank accounts; a Trust Account utilized for money attached by garnishment or cash seizure, and a cash account for disbursing payroll and purchasing supplies.
Senator Raggio commented it would be improper not to have a Trust Account for monies attached to be held in trust, although he expressed concern about objections to auditor review of all account activity, including how money was spent. He stressed the need for the information to determine whether the office is cost efficient. He noted a full audit may justify the constable’s position.
Mr. Peterson responded he considered fees collected personal income, and justified his statement by declaring the Nevada Revised Statutes dictate so. He suggested if the office was abolished by the county commission and responsibilities assigned to the sheriff, additional salaries and benefits would significantly increase sheriff’s costs.
Senator Raggio asked if he was concerned the sheriff could provide timely and efficient service.
Mr. Peterson surmised employees paid for an 8-hour day, only work an 8-hour day, but those who are paid by commission are available all hours of every day.
John J. Hart, Former Constable, Reno Township, testified against S.B. 83 summarizing the history of legislative enactment and regulation of the office of constable. He explained the Legislature set the salary and fees paid to constables, asserting the county commission was not entitled to any part of fees, insisting they should never be given authority to attach any of the collected fees. He emphasized constables were available 7 days a week, all hours of a day and added they provided better service than the sheriff and in a timely manner.
Rod Barbash, Chairman Legislation Committee, Nevada Collectors Association, testified against S.B. 83 saying he has utilized both the sheriffs’ and constables’ offices for 44 years. He emphasized constables provide a superior service, adding they complete service the next day, whereas, he said, it took the sheriff several days to effect service. He concurred A.B. 67 would increase sheriffs’ service fees, estimating the increase to be over 500 percent. He complained monies garnished or attached by the sheriff may take 3 months before being released to the creditor. He noted post-judgment interest accrued until proceeds are released, adding it was not fair to judgment debtors.
John Langon, Constable, Sparks Township, testified against S.B. 83 stating the office was an elected position and allowed the public a choice. He concurred constables are available all hours every day of the week, adding they are dedicated to providing quality service. He pointed out the Sparks Constable’s Office effects 99 percent of all evictions and expounded on daily details of duties carried out by the office. He concluded he viewed the bill as an attempt to remove the option of choice away from the public.
Senator Raggio restated concern about the constables’ resistance to a complete audit of financial records. He related federal, state and local governments have the right to review public monies, asserting there was a need for verification that the county has in fact received 50 percent of collected fees over the $55,000 net threshold.
Mr. Langon replied he understood the law states county commissioners pay constables either by salary or by fees collected, or a combination of both. He explained he felt fees collected are his personal money as law states "either", "or", "or both".
Senator Raggio inquired what his gross earnings were for performing services during the calendar year 1996, advising any testimony before a legislative committee was considered under oath. However, he explained the committee needed to know his income in light of the fact public money was involved. In addition, he requested Mr. Langon provide fee reports from the previous 2 years.
Ralph S. Shamshoian, Property Manager, Edington and Associates, Inc., testified against S.B. 83 clarifying his association was one of the largest residential property managers in northern Nevada. He expressed they were strongly opposed to abolishing constable offices in Reno and Sparks. He stressed constables provided a higher level of service overall, explaining court orders are valid for only 24 hours and often a sheriff cannot provide service within that time frame. He said sometimes a sheriff effects service after expiration of the court order, and asserted it had exposed his organization to liability. He noted the Reno and Sparks constables are conveniently located which was conducive to holding costs down in mileage charges and delayed delivery of service. He concluded by characterizing the constables’ job performance and service as outstanding, offering legislative regulation was imperative to maintaining the quality of service provided by constables.
O’Connell inquired about the average time to remove a tenant after papers were served. She remarked her experience was as long as 30 days in southern Nevada, and asked what was the difference in the north
Mr. Shamshoian, responded typically from the date of service the fastest was 10 days to eviction, and added he had heard in Clark County it takes longer.
Michael Lindell, Concerned Citizen, testified against S.B. 83 identifying himself as an apartment owner in Reno, stating he employed the constable’s office in this capacity as needed. He said it was his experience, the constable’s office provided prompt, competent and economical service. He remarked private process servers charge quadruple service charges more than what the constable charges. He concluded by declaring the Reno Constable had provided excellent service at an affordable cost.
There being no further testimony Chairman O’Connell closed the hearing on S.B. 83 and introduced Bill Draft Request (BDR) S-499.
BILL DRAFT REQUEST S-499: Makes various changes to charter of City of Sparks.
Stephanie S. Tyler, Lobbyist, City of Sparks, introduced BDR S-499 explaining it the Sparks City Charter. She clarified it would authorize additional Municipal Court Judges and provided for predetermination hearings for classified city employees.
SENATOR RAGGIO MOVED FOR COMMITTEE INTRODUCTION OF BDR S-499.
SENATOR SHAFFER SECONDED THE MOTION.
THE MOTION CARRIED. (SENATOR O’DONNELL WAS ABSENT FOR THE VOTE.)
* * * * *
There being no further business before the committee, Chairman O’Connell adjourned the meeting at 4:30 p.m.
RESPECTFULLY SUBMITTED:
Nancy S. Arnold,
Committee Secretary
APPROVED BY:
Senator Ann O'Connell, Chairman
DATE: