The Committee on Ways and Means was called to order at 8:18 a.m., on Tuesday, May 25, 1999. Chairman Morse Arberry Jr. presided in Room 3137 of the Legislative Building, Carson City, Nevada.

COMMITTEE MEMBERS PRESENT:

Mr. Morse Arberry Jr., Chairman

Mr. Bob Beers

Mrs. Barbara Cegavske

Mrs. Vonne Chowning

Mrs. Marcia de Braga

Mr. Joseph E. Dini, Jr.

Ms. Chris Giunchigliani

Mr. David Goldwater

Mr. Lynn Hettrick

Ms. Sheila Leslie

Mr. John Marvel

Mr. David Parks

Mr. Richard Perkins

Mr. Bob Price

COMMITTEE MEMBERS ABSENT:

Ms. Jan Evans, Vice Chair (Excused)

STAFF MEMBERS PRESENT:

The Chair recognized Donna West, Project Manager, Project Genesis, Department of Motor Vehicles and Public Safety (DMV/PS). Referring committee members to Exhibit C, an analysis of Project Genesis funding for the upcoming biennium, Ms. West explained S.B. 279 was a request to fund project activities and tasks for Project Genesis from the Highway Fund. DMV/PS was asking to carry forward unspent funding from FY 1999 to FY 2000 to complete activities that had begun during FY 1999. She said DMV/PS was also asking for $7,700,933 to complete activities of phase II of its project plan and to begin phase III, the implementation of alternative service delivery methods using enabling technologies.

Ms. West explained page C-1 of Exhibit C reflected proposed expenditures in
FY 1999 and FY 2000 to complete contracts and leases that had been entered into in preparation for phase II implementation. Page C-2 was a high-level list of activities for the completion of phase II in FY 2000. Also listed on page C-2 was a list of enabling technologies that would be "rolling out" in the upcoming biennium. Page C-3 was the breakdown of one-shot expenditures.

The Chair asked for clarification of the ending date of the Deloitte & Touche contract and Ms. West said that date was November 30, 1999. The Chair asked if the legislature appropriated the requested amount, would DMV/PS be requesting additional funding for Project Genesis in the future. Ms. West told committee members DMV/PS would be back in the next biennium to request funding for the remainder of the enabling technologies to include document imaging, renewal at vehicle registration stations, and any other third-party or privatization-type acts whereby service could be provided without a customer having to go to a DMV/PS office. She advised the re-engineering within the agency would be completed in the current biennium. The Chair asked the amount of additional funding that would be requested and Ms. West said that it would be less than $10 million.

The Chair recognized Ms. Giunchigliani who asked the total cost of the Deloitte & Touche contract and Ms. West replied $8.1 million. Ms. Giunchigliani then asked the total budget for implementing Project Genesis and Ms. West said the total overall budget was projected at $35 million. She explained $14.1 million had been funded for the 1998-99 biennium. Ms. Giunchigliani asked if DMV/PS was now asking for an additional $14 million and Ms. West said the additional request was for $7.7 million. She explained the $14.1 million alluded to in Section 1 of the bill represented the allocation for the current biennium. The agency was asking to carry forward the unspent funds from that allocation. Ms. Giunchigliani stated the entire cost of Project Genesis was $35 million. To date, the agency had expended $14 million plus the additional request for
$7.7 million thereby leaving a balance of an additional $14 million. Ms. West noted there had also been a $1 million budget for the phase I project. To date, she said, the agency had expended slightly in excess of $15 million and was asking for an additional $7.7 million. In response to The Chair’s question,
Ms. Giunchigliani said the request for future funding could represent an additional $14 million. Ms. West said, in her estimation, the request would be for less than $10 million. Ms. Giunchigliani said the total cost of Project Genesis could come in under the projected $35 million and Ms. West said that was the agency’s hope.

Ms. Giunchigliani asked if there were penalties associated with the Deloitte & Touche contract. Ms. West replied there were liquidated damages against Deloitte & Touche within the contract regarding any of the key deliverables associated with system implementation. Ms. Giunchigliani then asked who would be providing the training regarding Project Genesis and Ms. West said the agency had contracted with Deloitte & Touche to provide training on the use of the application. The company would be responsible to train agency staff as trainers and to oversee the "roll-out" of the training. Ms. Giunchigliani asked how many staff would be trained and Ms. West responded, on any given day, there would be 12 trainers involved with 75 students in each one of three classrooms around the state.

The Chair commented the original bill had requested $8.6 million and that amount had been amended to $14 million. Ms. West clarified the original one-shot funding request was for $8.1 million. That request had then been reduced to $7.7 million as the result of a reduction in contractual services.

The Chair recognized Ms. Giunchigliani who questioned the implementation of the digitized drivers’ license photos at a cost of $598,000. She recalled a difference of opinion in the budget closings and asked if the agency was asking twice for the same thing. Ms. West explained the funding requested in this one-shot as opposed to what had been requested in the drivers’ license budget was the funding to purchase DMV’s own server for the storage of the digitized images. Discussions with DoIT had revealed the cost to rent storage on DoIT’s machines for those digitized images would cost in excess of $1 million each year as opposed to purchasing its own server. Ms. Giunchigliani then asked if the $600,000 represented the actual cost of the photos and Ms. West said the $600,000 represented the ongoing operating costs of the system.
Ms. Giunchigliani stated there were approximately one million drivers’ licenses in the state that would not all expire at the same time. She did not want money "front-loaded" based on the agency’s monthly or yearly average of drivers’ license renewals. Ms. West said the agency would provide staff and committee members with a breakdown of the operating costs of the system outlined in the drivers’ license budget as well as the language that had been included in the one-shot regarding the request for the server in the amount of $598,000.
Ms. Giunchigliani pointed out there would be no cost savings associated with the new system, rather, there would be a continuing ongoing cost deduction from the Highway Fund and Ms. West said that was correct.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on S.B. 279 closed.

The Chair recognized Dennis Colling, Chief of Administration, Department of Motor Vehicles and Public Safety (DMV/PS). Mr. Colling explained S.B. 280 requested funding for the purchase of modular office equipment for the DMV/PS building on Wright Way in Carson City to finish its remodeling.

The Chair recognized Mr. Marvel who asked if DMV/PS would purchase the furniture from Prison Industries and Mr. Colling said it would not. Mr. Marvel then asked why and Mr. Colling explained the request was for specialized modulars that would accommodate computer wiring. He said the purchase would be accomplished through a state contract. Mr. Marvel thought Prison Industries constructed modulars and directed Mr. Colling to find out.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on S.B. 280 closed.

The Chair recognized Mr. Dale Erquiaga, Acting Director, Department of Museums, Library and Arts. Mr. Erquiaga told committee members S.B. 308 would appropriate $562,000 for the Boulder City Railroad Museum. He said that museum currently consisted of approximately four miles of track, a maintenance facility, one staff person, and a great deal of "rolling stock" that had been purchased through a bonding program courtesy of the local governments. The appropriation would allow the department to refurbish some of the equipment and provide for an excursion train.

Mr. Erquiaga said each time he had appeared before committee members he had been asked about cultural tourism and the department’s efforts to bring people through its museums. The project outlined in S.B. 308 would be such a project.

He told committee members that Doug Mishler had been appointed as the new administrator of the Museums and History Division. Dr. Mishler held a Ph.D. in history and was a Chataquah Scholar as well as a living historian. Mr. Erquiaga felt Dr. Mishler would bring to the department a new perspective that would be helpful at the Boulder City Railroad Museum and other facilities. One of
Dr. Mishler’s first projects would be the implementation of S.B. 308.

Mr. Erquiaga said there was some history regarding the appropriation request that Scott Sisco, Administrative Services Officer, Department of Museums, Library and Arts would explain. Mr. Sisco explained S.B. 579 had been approved by the 1995 legislature to include a $2.5 million appropriation for the development of the Nevada State Railroad Museum in Boulder City. That appropriation provided funding availability through June 30, 1999. Over the past three years, he said, the department had worked with various federal, state, county, city, and other local governments and groups having the interest in the development of this facility. Mr. Sisco said those various agencies and groups assisted with the selection of the best possible route for the extension of the railroad track as originally proposed. As a result of that combined involvement, a 2½-mile loop track had been adopted and the department had recently obtained the additional right-of-ways and land transfers from the Bureau of Reclamation.

During the same period, he said, the department was required to complete various environmental assessment studies which were conducted and written by the University of Nevada Las Vegas (UNLV). Matters that had to be dealt with included the Endangered Species Act that resulted in a $69,000 fee assessed by the U.S. Fish and Wildlife Service paid to the Desert Tortoise Habitat Conservation Fund. Also during the same time period, an engineering firm was hired to deal with engineering issues and design work. The firm had since completed the final engineering and design drawing for the project.

Mr. Sisco told committee members in the summer of 1998, the department was ready to proceed with the road bed development. However, as committee members were aware, it became obvious the state would experience a budget shortfall for the current fiscal year. During the department’s presentation of its proposed biennial budget to the budget office, the now-retired administrator for the division of museums and history discussed the project. Included in that discussion was a funding request in the amount of $1.3 million to be included as an enhancement in the budget request for a track bed to be laid on the road bed. It had been further discussed that if the enhancement was not funded, that the current road bed work could deteriorate and the current investment could be lost. Mr. Sisco said as the extent of the budget shortfall became apparent, the $2.1 million that was to be used for the road bed construction was included in the reversion requirements for the department. He said the department had worked with the budget office to prepare alternatives that would allow the project to continue. A compromise had been reached, the result of which was S.B. 308.

Mr. Sisco explained the bill provided for $562,246 in funding that was detailed in Exhibit D, a document titled "Senate Bill #308, Nevada State Railroad Museum/Boulder city Start Up Costs." The appropriation would allow the project to continue through the upcoming biennium by concentrating on the passenger facilities, coach refurbishment, and limited track work. He advised the project was included in The Executive Budget on budget page INTRO-36.

The Chair recognized Mrs. de Braga who commented there had been individual appropriation requests for the majority of the railroad museums in Nevada. She asked if the department had established a long-term priority list for those projects and whether that list would be based on visitor usage of the museum.

Mr. Erquiaga explained that as the department had gone through the normal budget process, prior to his arrival, it had prioritized position requests as well as capital expenditure requests. He said the project was given a priority based on either the history of an institution or the number of visitors it served. As committee members were well aware, the department spent a fair amount of money on Nevada’s museums. The department felt the railroad museum in Boulder City had the capacity to generate revenue for the state. He said the appropriation was critical to the department’s long-range plan to build-out the facility first as an excursion train that would generate revenue. As committee members were aware, the Carson City Railroad Museum was a very popular tourism attraction, probably one of the leading project’s in the department’s portfolio in terms of revenue generated for the state. The department felt that Boulder City, due to its location, had the capacity to far surpass the Carson City museum.

Mr. Erquiaga expressed to committee members the critical priority of the appropriation and the importance of not losing the work that had already been done on the project.

The Chair recognized Mr. Marvel who asked how many miles of track existed for the railroad and Mr. Erquiaga replied 4.1 miles. The track ran from just inside the city limits of Boulder City to the casino Railroad Pass. As committee members may recall, there were plans to build a further loop that would require the expenditure of several million dollars. He clarified this project would use existing track, refurbish the stock, and trains would be run from the museum. Mr. Marvel asked how much road bed remained. Mr. Erquiaga deferred the question to Greg Corbin, Assistant Administrator, Railroad Operations for the Division of Museum and History. Mr. Corbin explained the entire track was in place from Las Vegas to Boulder City. The track represented the Boulder Branch Line that had been constructed in 1931 for the construction of Hoover Dam. He said there were 41+ acres located in Boulder City for the development of the future Nevada State Railroad Museum. The site stored roughly 50 pieces of rolling stock. The first phase of the project, the railroad maintenance facility, was completed at the site in 1996.

Mr. Marvel asked the total cost of the master plan and Mr. Erquiaga responded the completion of the 2½-mile excursion loop had been estimated at
$3.3 million. Continuing, Mr. Erquiaga told committee members the appropriation would fund a portion of the refurbishment work to be done to the railroad rolling stock that included two engines (one primary and one backup) and two of five cars that had been identified to become the excursion train. While the department was looking at a small funding amount to begin the project, the entire restoration package would require funding in the amount of $1.2 million. The department had not yet discussed the development of the museum. He said previous estimates had identified funding requirements between $17 million and $20 million.

Mr. Marvel asked if the engines were coal-fired or diesel and Mr. Erquiaga replied diesel-electric. There was one steam locomotive that had been earmarked for restoration at some future date. Mr. Marvel then asked if the project anticipated any environmental problems and Mr. Erquiaga said the completed environmental assessment study indicated there would be none.

Addressing the Chair, Mr. Erquiaga said he thought committee members had been informed the day prior that the Nevada Library Association wanted to propose an amendment to S.B. 308. He stressed to committee members the criticalness of the museum bill to the department’s continued development and explained it was part of the department’s job to run the state library. He introduced Danny Lee, who represented the Nevada Library and Literacy Advisory Council and lobbyist for the Nevada Library Association, and explained the program he would present was a critical component of the state library.
Mr. Erquiaga also introduced the new Administrator of the State Library and Archives, commonly referred to as the State Librarian, Monteria Hightower.
Ms. Hightower had written the funding formula that Mr. Lee would discuss with committee members.

Mr. Lee referred committee members to Exhibit E (Original on file at the Research Library, Legislative Counsel Bureau), a report to the legislature on Nevada’s public libraries. He told committee members Exhibit F, a 4-page document titled "Nevada Public Libraries Financing Statistics FY98," was an audit of how the $2.4 million appropriated by the 1997 legislature had been expended. He said each library in the state received a portion of the funds allocated as a result of S.B. 309 (1997). Page F-1 of Exhibit F reflected that Clark County received approximately 10 percent of its expenditures, while some of the smaller libraries received almost 200 percent of their expenditures. He pointed out the formula had been geared to help the small libraries. The formula required a match and the $2.4 million in turn developed almost $14 million in expenditures.

Mr. Lee explained the $2.4 million funding request in the department’s original budget submission had been removed. He said the amendment was being requested with the approval of the Department of Museums, Library and Arts, and Senators Porter and Rawson. The amendment would request an amount equal to the last legislative appropriation of $2.4 million. Mr. Lee was well aware of the budget shortfall and wanted to clearly state that although the amendment would ask for $2.4 million, any amount would be accepted.

The Chair asked why the bill was not amended in the Senate. Mr. Lee said it had been hoped the $2.4 million would be placed back in the department’s budget. It had been decided at such a late date in session, the request should be in the form of an amendment.

Mr. Lee said he would appreciate the committee members’ acceptance of the amendment.

The Chair recognized Denice Miller, Office of the Governor. Ms. Miller was proposing an amendment to S.B. 308 to change the requirements for the director of the Department of Museums, Library and Arts. She referred committee members to Exhibit G, a copy of the proposed amendment and explained the director of the department was currently required to have an advanced degree in either museums, libraries, arts, or a related field. During the transition period, Ms. Miller said she had conducted a study related to the requirements for other cabinet heads. As she recalled, there was only one other cabinet head required to have an advanced degree, namely, the director of the Department of Transportation. There were other department heads that were not required to have any type of degree, but rather their background had to include an emphasis on management. Ms. Miller advised it was the opinion of the Office of the Governor that the director of the Department of Museums, Library and Arts required more of an emphasis in management abilities because it worked closely with state, local, national, and community organizations and officials. She pointed out there was an emphasis in tourism and educational pursuits as well. The Office of the Governor felt the management and direction of the department required substantial administration experience rather than simply a technical degree, especially in view of the fact the division heads under the director already had substantial technical degrees. She said the Office of the Governor believed the flexibility to select the most qualified candidate was more important than simply selecting a candidate who met a statutory requirement. For example, she said, she qualified to be the director of the Department of Museums, Library and Arts. She pointed out the department was very fortunate to have Mr. Erquiaga as its director.

Should the amendment not be included, Mr. Erquiaga could remain acting director. In the interest of public policy, however, Ms. Miller said the Office of the Governor would prefer to have consistency in the statutes. She told committee members Mr. Erquiaga had told her the requested appropriation had priority. If the amendment would in any way jeopardize the approval of the appropriation, Mr. Erquiaga would prefer not to see the amendment pass.

The Chair asked if the Senate would concur with the approval of her amendment. Ms. Miller apologized for the Office of the Governor that the bill had passed out of the Senate without its knowledge. She had only learned on May 17, 1999, that the bill was in Assembly Ways and Means. Ms. Miller explained Senator Raggio served on the transition team and had in his possession a copy of the amendment and she believed committee members would find that the Senate would concur.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on S.B. 308 closed.

The Chair recognized Assemblywoman Bonnie Parnell, representing Assembly District #40, the majority of Carson City. Ms. Parnell explained S.B. 368 simply addressed an inequity. She said what, in the 1960s appeared to be a fair exchange, had since proven otherwise. She applauded Carson City for its sensitivity to the budget shortfall and explained the city was not asking for any of the $2.7 million in waived connection fees. The city was only requesting that after the year 2001, future sewer connection fees associated with the construction of new state facilities be paid. Ms. Parnell introduced Ray Masayko, Mayor of Carson City, and John Berkich, City Manager.

The Chair recognized Mayor Masayko who said he was before committee members to provide them with background and policy information regarding sewage connection fees. Mayor Masayko said he wanted to review the policy and process adopted by the Carson City Board of Supervisors in dealing with both the enterprise fund known as the Carson City Sewer Utility and other enterprise funds operated by the city. The mayor said the city operated those funds as if they were a separate and private utility. As a matter of fact, he said, the city was not only very sensitive to the fees charged its customers for sewer service, but was sensitive to the fact it charged a capitalization fee as a condition of hookup. He said every person and business in Carson City paid both those capital costs and service fees with the exception of the State of Nevada and the University System that were exempted by the legislation passed in 1959. If a new entity hooked up to the city’s sewer system, whether or not it was a taxpayer-supported entity, it would be charged those connection fees. The Mayor advised the city did all in its power to keep the processes straightforward and as clean as possible. In so doing, the city believed it served two constituencies; namely, the taxpayers of Carson City and those customers on the sewer system. He said those customers were responsible for all of the operating costs and would ultimately be responsible for the payment of the bonded indebtedness of the sewer system.

As most committee members were aware, Carson City, with its small land area, would at some point in the future have "grown out." At that time, the Mayor said, those capital costs imbedded in either the water or sewer system would have to continue to be paid off and there would be no connection fees to offset those costs. The Mayor explained the only resource the city would be able to turn to in that case was the utility customers. He said it was the city’s desire to minimize those rate increases.

As Assemblywoman Parnell had indicated, the city had coordinated with the manager of the State Public Works Board (SPWB) regarding existing budget issues. He explained the capital improvement projects slated for Carson City during the next biennium would continue to function under the 1959 waiver law. Should S.B. 368 pass, it would not become effective until July 1, 2001. The Mayor estimated the financial impact to both the State of Nevada and the University System at approximately $50,000 per year. The exact amount would depend specifically on newly constructed facilities hooked up to the sewer utility system in the future.

The Mayor said he was before committee members to ask for an equity adjustment to a process that had been in place almost 40-years. The city felt both the State of Nevada and the University System had been treated fairly over the years and had recovered far in excess of the initial cost of the 1959 appropriation and land dedication.

The Chair asked if new projects would be exempt if they were completed after July 1, 2001. The Mayor was not aware if the bill spoke to that issue, but his "policy-making hat" told him if the projects were permitted and the water and sewer connection fees had been paid prior to that date, fees for those projects would not be requested.

The Chair recognized John Berkich, Carson City Manager who provided committee members with the following verbatim testimony:

Chairman Arberry excused himself from the meeting and turned the gavel over to Mr. Dini to proceed.

Mr. Dini asked the amount of the average household fee in Carson City for sewage and Mr. Berkich said approximately $15. Mr. Dini then asked if that was an average fee and Mr. Berkich responded it was one of the lowest rates in the West.

The Chair recognized Mr. Price who asked the amount of the connection fee and Mr. Berkich replied approximately $2,500.

The Chair recognized Eric Raecke, Manager, State Public Works Board (SPWB). Mr. Raecke told committee members the immediate fiscal impact of the bill was waived by the July 1, 2001 implementation date. He anticipated every project on the 1999 CIP would be "up and running" by the effective date of the legislation. Using a building the size of the Blasdel Building as an example,
Mr. Raecke explained a sewer connection fee would run approximately $30,000. He envisioned that within the next 20 years there would be
10 buildings in the Capitol Complex buildout. SPWB anticipated a $600,000 long-term impact that would addressed in each separate project. Mr. Raecke told committee members that while SPWB did not pay impact or permit fees in all other cities in the state, it did pay sewer and water connection fees. He pointed out the arrangement in Carson City during the past 40 years was unique.

The Chair commented the fiscal impact on the state over the buildout period of 20 years was not insurmountable. Mr. Raecke agreed the fiscal impact was negligible and could be addressed in the budget process.

Regarding the Capitol Complex buildout, Mr. Price asked if the additional buildings would be constructed adjacent to the capitol building. Mr. Raecke explained the master plan he had developed for the Capitol Complex anticipated the construction of buildings between the capitol building and just south of the Nevada Department of Transportation (NDOT).

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on S.B. 368 closed.

The Chair recognized Bob Loux, Executive Director, Agency for Nuclear Projects. Mr. Loux told committee members S.B. 507 was a supplemental appropriation request in the amount of $16,187 to complete the final month of funding (June 1999) for the agency. As committee members may recall, the agency had been before the Interim Finance Committee (IFC) a minimum of four times to secure funding for FY 1999. The agency’s last meeting with IFC had secured funding through May 1999.

The Chair recognized Mark Stevens, Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. Mr. Stevens said staff wanted committee members to be aware how the appropriation would be expended. Usually, he said, supplemental appropriations provided only the amount of funding absolutely necessary for an agency to operate through the end of the fiscal year. The appropriation in S.B. 507 included funding for replacement of office chairs, an item not typically included in a supplemental appropriation request. Mr. Stevens said between the supplemental appropriation request in the bill and the agency’s budget for the next biennium, there was a total of 9 personal computers being replaced for 9 positions, 3 laptop computers, Microsoft Office and WordPerfect software for all 12 machines, and 2 file servers. Staff questioned the need for two file servers. Mr. Loux advised the overall amount the agency was requesting for information services was consistent with the budget (approximately $12,000) previously approved by the legislature. He explained the agency had postponed the acquisition of the equipment for the last two years in an attempt to stretch those dollars as far as possible. The supplemental appropriation would provide funding for one personal computer and two laptops and the agency's budget requested 8 additional personal computers and one additional laptop. Mr. Loux explained the overlap occurred in that three staff positions would have both a personal computer and a laptop. Those employees traveled extensively and the laptops provided necessary mobility. He told committee members the agency had requested two file servers. One of those servers would store public access documents. As committee members were aware, the agency had not proposed any funding for public information programs. The majority of public information available from the agency was distributed through its website. Additionally, the Nuclear Regulatory Commission was instituting a new licensing proceeding that would require both the proponents of the Yucca Mountain project, the Department of Energy, and other interested parties to "link-up" to its license and support system. Technology had developed to the extent the Nuclear Regulatory Commission had decided to use the Internet for the entire license and support system. Mr. Loux said a separate, more secure file server system would be necessary for the agency to participate in the licensing support system. He said that in order to process the volume of documents the agency anticipated to be active in the licensing arena would require the additional file server.

Mr. Dini returned the gavel to Chairman Arberry to proceed with the meeting.

The Chair recognized Mr. Beers who asked who had given the agency its technology advice. Mr. Loux responded the Department of Information and Technology. Mr. Beers told Mr. Loux for approximately $100 the agency’s three laptops could very easily be made nodes on its local area network (LAN) at the office and Mr. Loux agreed. Mr. Beers was alarmed to see the cost for a 56K modem had been listed at $640. Additionally, he advised the volume of documents stored had nothing to do whatsoever with the number of file servers needed. The technology was such that hard drive space could be added to accommodate varying levels of security and size on one machine. While Mr. Loux was personally not aware of that information he would find out and report back to committee members. He advised he operated on a laptop put into a docking system and said the system was uncomfortable to use for any length of time. Mr. Beers said for another $100 a mouse and keyboard could be purchased to alleviate that problem.

The Chair asked that Mr. Beers work with the agency and its DoIT representative to resolve those cost issues immediately.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on S.B. 507 closed.

The Chair recognized Chris Giunchigliani, Assemblywoman, representing Assembly District #9, who told committee members A.B. 598 was one of the recommendations from the interim study committee that she had chaired. Also serving on the study committee were Public Works Director Eric Raecke, Senator Jack Reagan, Mary Petersen from the State Board of Education, Controller Kathy Augustine, Assemblywoman Cegavske, and others she could not recall.

Ms. Giunchigliani said A.B. 598 envisioned all state buildings being brought into compliance with the Americans with Disabilities Act (ADA) and Americans with Disabilities – Accessibility Guidelines (ADAG). She pointed out that while the law regarding ADA became mandatory in 1973, many state buildings still remained inaccessible to the disabled.

The bill, she said, envisioned creating a certification mechanism across the State. She had conducted two meetings with approximately 30 different participants from the local governments to work with this piece of legislation. It was then determined, after discussions with the Department of Justice (DOJ), the easiest and most responsible manner in which to ensure ADA compliance was to adopt ADAG as the state code. Local planning officials would then refer to that code as they performed plans review and approval. Ms. Giunchigliani was recommending the adoption of ADAG as an amendment to A.B. 598. She said the majority of the language would be deleted and rewritten to accommodate her amendment. Ms. Giunchigliani explained the legislation would focus solely on state-owned buildings. Regarding training, DOJ had informed her it provided training and seminars to local building officials. Regular training was conducted around the United States, with several sessions being conducted in Nevada. She said the study committee had received a great deal of input from Bob Nunez, a gentleman that reviewed plans for Douglas County.

The Chair recognized Mr. Dini who asked if local governments were complying with ADA requirements and Ms. Giunchigliani replied not entirely. Mr. Dini recalled he had been involved with the construction of two restrooms in the City of Yerington at a cost of $190,000 that required ADA approval before building permits could be issued. Ms. Giunchigliani explained ADA requirements were not consistently met. She advised that even though many architects had ADA code background, not all plans checks were reviewed for those requirements and, as a result, many buildings had to be redone.

Ms. Giunchigliani told committee members the DOJ would be adopting a new, international code for the United States and that ADAG would be included in that code. She said A.B. 598 would prepare Nevada for that new federal law.

Unfortunately, she said, many buildings in Nevada had allegedly been reviewed for ADA compliance and yet remained non-compliant. She had received information that an individual on a school construction project had asked if a toilet seat could be installed on the same wall as the showerhead. That situation told her the individual had no knowledge of ADA requirements. She pointed out the legislative building had not originally met ADA codes.

Mr. Dini commented the bill would have a large fiscal impact. Ms. Giunchigliani clarified the legislation would affect only new plans as they were being reviewed. She said the intent of the legislation was to ensure construction was ADA compliant at its inception. She felt money would be saved in the long run. Mr. Dini was not certain that would be the case.

The Chair recognized Mr. Raecke who told committee members that every building official, plan reviewer, or inspector related to the Universal Building Code (UBC) because it was codified. He said the American Building Contractors Association (ABA) used the Council of American Building Officials’ American National Standards Institute (CABLEANTSI) as a standard for requirements for the disabled. The ADA was an act passed by the Federal Government that had never been codified or placed in the codes a building official or an architect who designed buildings would relate to. He felt the bill would clarify the language and would show the intent of the State of Nevada’s desire to comply with ADAG.

The Chair recognized Mr. Marvel who asked if there was a certification process and Mr. Raecke replied the proposed amendment eliminated that process.
Mr. Marvel then asked if SPWB’s staff were able to certify ADA compliance and Mr. Raecke said SPWB had seven individuals qualified by the UBC to perform plans review.

Mr. Marvel asked if the bill was a "window dressing" effort and
Ms. Giunchigliani replied the bill would show that Nevada was moving forward to achieve full ADA compliance. Mr. Marvel then asked if the bill would require additional retrofitting. Mr. Raecke explained the statewide ADA retrofit program would be funded for approximately $2 million in the 1999-01 CIP Program. Earlier review of actual requirements had revealed a $7 million to $9 million need. He said approximately $7 million had already been invested into retrofitting state buildings to ensure handicapped individuals could both access and use state buildings.

The Chair recognized Cheryl Blomstrom, Nevada Chapter Associated General Contractors. Ms. Blomstrom said the chapter had been pleased to work with the sponsor of the bill and associated amendment. She expressed the chapters support of A.B. 598.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on A.B. 598 closed.

The Chair recognized Mark Stevens, Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. The following budgets were being reviewed at the request of the Chair and as the result of S.B. 491 passing out of the Senate.

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The Chair recognized Dan Tom, Director, Department of Business and Industry (B&I). Mr. Tom said discussions had been conducted with Legislative Counsel Bureau (LCB) staff relative to the impact of S.B. 491. Based on the budget recommended by the Governor, the passage of S.B. 491 would require substantial changes to the Taxicab Authority (TA) and Transportation Services Authority (TSA) budgets. He confessed to committee members B&I had invested a great deal of time on the situation and had not been able to draw a conclusion as to exactly how to configure the expenditures as contemplated in S.B. 491.

Mr. Tom said a potential problem related to S.B. 491 was that Highway Funds could be limited with regards to some of the expenditures outlined in the bill, notably, the support of the anticipated northern taxicab authority. He said if those kinds of issues were real, B&I was thrown into a quandary as to how the elements of S.B. 491 would be funded. He explained the other aspects related to S.B. 491 that would possibly pose difficulty with Governor’s desire to establish a northern taxicab authority included increased trip charges and fees.

Mr. Tom said there had been substantial testimony from the industry and those who testified had agreed to various levels of increased fees and trip charges to pay for some of the regulation that was anticipated. He was not certain of the unanimity of that testimony.

Mr. Tom said there had been varying increases in fees and trip charges in
S.B. 491 and its numerous amendments. One of B&I’s difficulties with the bill as it was presently proposed was that it had not been redrafted with the inclusion of all the amendments. He said the original budgets of both TA and TSA had anticipated using approximately $1.7 million in Highway Funds to fill the gap the TSA would experience in expenditures versus income. If Highway Funds could not be accessed, it was possible some funding could be accumulated through new revenue sources.

The Chair recognized Mr. Marvel who asked if S.B. 491 envisioned a taxicab authority in northern Nevada and Mr. Tom responded that it did. Mr. Marvel asked the justification for a new agency and Mr. Tom replied that while he was not certain, he thought the genesis for a taxicab authority in the north was industry and legislative support. Mr. Marvel then asked if increased fees would jeopardize the "senior ride" Program. Mr. Tom replied there was considerable effort to preserve that program and, to his knowledge, there was no effort to curtail that program. Mr. Marvel said he was still confused regarding the funding. Mr. Tom explained S.B. 491 anticipated "splitting up" a number of the activities of the TSA and placing them elsewhere. The TSA was funded largely by Highway Funds and if those funds did not follow the separate activities, new sources of funding would have to be found. Mr. Tom told committee members B&I had been informed it was possible Highway Funds could not be used for regional commissions. If that were the case, he said, there would be no funding source other than the generation of new fees. Mr. Marvel commented it would be difficult to track different sources of funding and how those dollars were spent if the activities of TSA were split up and assigned to other agencies.

Continuing, Mr. Marvel asked TSA’s total budget request and John Mendoza, Chairman, Department of Business and Industry, Transportation Services Authority (TSA) responded $1.8 million. Mr. Marvel then asked how much of that total requested Highway Funds and Mr. Mendoza replied approximately $1.3 million.

The Chair expressed his frustration regarding the proposed changes to TSA and the fact no studies had been conducted regarding the feasibility of the proposed changes. That, paired with the unknown language in S.B. 491 created a dilemma for committee members. Mr. Tom said it was his understanding the Senate’s notion in both committee and subcommittee was that current conditions at TSA would prevail until October 1, 1999. That would allow a time period to resolve the issues at hand.

The Chair recognized Mr. Stevens who said committee members needed to take into consideration was how the TA and TSA budgets would be closed for the Appropriations and Authorizations Act. Earlier, committee members had removed both the TA and TSA from the Appropriations and Authorizations Act and let the amounts associated with those budgets to flow into a bill. If the bill were not processed and the budget amounts had been removed from the Appropriations and Authorizations Act, there would be no funding for those agencies. Mr. Stevens explained the Senate had closed both budgets as the Governor had recommended with minor changes. Then, it passed S.B. 491 and included language that would allow the agencies to come back to the Interim Finance Committee by October 1, 1999 to then realign the staffs of both TA and TSA among the impacted agencies. If committee members chose to close those budgets as the Governor had recommended with minor adjustments, and included those amounts in the Appropriations and Authorizations Act, it would provide budgetary authority for those agencies to continue in their present form if S.B. 491 did not pass. Specifics could then be worked out in S.B. 491 or some other piece of legislation. Mr. Stevens said immediate action needed to be taken by committee members regarding how the TA and TSA would be included in the Appropriations and Authorization Act or the adoption of some other alternative. The long-term problem, he said, was how committee members would deal with S.B. 491.

The Chair recognized Mr. Marvel who expressed his continued concern regarding funding sources. Mr. Stevens said staff hoped committee members could look at the issue in two different ways:

• Close both budgets under the assumption there were no changes and allow staff to include funding for both agencies in the Appropriations and Authorizations Act.

• Independently review S.B. 491.

Mr. Stevens explained one problem faced by committee members was the fact the most recent reprint of the bill was not available. While he could tell committee members the concept of the legislation, he could not provide the specifics.

The Chair recognized Mr. Dini who expressed his concern regarding the necessity for a northern taxicab authority. He had conversed with Don Drake, Sparks Cab Company and Mr. Drake had expressed his support of S.B. 491 and the creation of a northern taxicab authority. Mr. Tom explained that while
B&I had been an observer of the testimony regarding the proposed northern taxicab authority, it was his understanding the authority would have three part-time commissioners and the level of regulation governing that agency was substantially less than the regulation governing the Clark County agency. He explained the TSA was currently in the position of licensing only taxicabs in northern Nevada. There was no trip charge. The creation of a northern agency would require some form of trip charge if Highway Funds were not available. Mr. Dini asked if the issue was Highway Funds versus trip charge and Mr. Tom said that it was.

Mr. Tom told committee members said B&I had anticipated the cost to put together a three-member part-time commission and base staff at between $250,000 to $300,000. He said some rough calculations had been performed regarding trip charge costs and that a $.10 cost would generate approximately $130,000 based on 1.3 million trips. An additional licensing fee of $75 would generate another $40,000 resulting in total revenue of $170,000.

The Chair recognized Mr. Dini who explained committee members were at a disadvantage not having seen the final version of S.B. 491 or hearing related testimony. Mr. Mendoza explained TSA was in the same position as the committee members. He said it would be a "guess" for TSA to comment on funding until it had seen the final version of the bill and its numerous amendments. It was important committee members were aware that TSA had historically moved in the direction of merging all transportation industry in Nevada under one department. That had been a contention with the proposed northern taxicab authority because it did not want to be regulated at the same level the TA regulated the southern authority. He recalled negative testimony regarding a trip charge in northern Nevada.

The Chair recognized Mr. Marvel who asked how the present TA in southern Nevada would be affected. Mr. Tom replied the TA would continue in its present form and gain authority for the regulation of limousines from the TSA and that buses had been deregulated. He explained that while there was minimal new work proposed in S.B. 491 it was configuration of that work ("who was going to do what") that was in question. It was his understanding the TSA would lose taxicabs throughout the balance of the state and would also lose limousines. TSA would continue to regulate tow cars and household goods movers. He explained the TSA would then be in a reduced capacity and the TA would pick up regulation of the limousines in Clark County. The TA would also become the larger commission and be comprised of three full-time commissioners. The TSA’s existing commission structure would be reduced to either one commissioner or one administrator.

Mr. Marvel asked if there had been any resistance on the part of the TA regarding the restructure. Mr. Tom replied TA’s concern related to whether funding would be available for them to absorb the additional work.

The Chair recognized Ms. Giunchigliani who stated that tow vehicles and household goods movers would remain and Mr. Tom said that was correct. She then asked the percentage of workload generated by tow vehicles and household goods movers and Mr. Mendoza replied approximately 40 percent. Ms. Giunchigliani asked how that 40 percent would translate into actual numbers. Mr. Mendoza replied there were 114 tow companies and
18 household goods movers. Ms. Giunchigliani stated there would be only one commissioner under S.B. 491 and both Mr. Tom and Mr. Mendoza said that was correct. She then asked how many positions ran the TA in Las Vegas and Mr. Anselmo, Administrator of the Taxicab Authority responded there was a board of five part-time members who met once a month.

Ms. Giunchigliani said she did not see the need to continue the TSA in view of its reduced workload.

The Chair recognized Mr. Stevens who explained one of the options committee members had regarding these agencies was to close the TA and TSA budgets as the Governor had recommended with minor changes as previously testified to by staff. If committee members chose that option, staff could include those amounts in the Appropriations and Authorizations Act. He explained any restructuring of the regulation functions could be dealt with in S.B. 491. If the bill were not passed, staff would have the authority to continue agency operations at their existing levels. If committee members passed S.B. 491 in some fashion, language could be included to allow those agencies to come back to the Interim Finance Committee (IFC) to change their regulatory structures and realign staff prior to October 1, 1999.

The Chair recognized Ginny Wiswell, Program Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. Ms. Wiswell told committee members the Governor was recommending status quo budgets for both the TA and TSA. She said the key decision for these two budgets focused on the funding mechanisms for the TSA. As committee members would recall there had been a revenue transfer in both years of the biennium from the TA to the TSA to finance the revenue shortfall and fund administrative costs related to judicial review in the TSA.

Ms. Wiswell explained the Governor’s budget had recommended replacing that revenue transfer with 100 percent Highway Funding. Decision Unit E-125 of the TSA’s budget reflected the elimination of revenue transfer from TA to TSA and thereby restore the reserves of the TA and ensure funding in both years of the biennium for the Senior Ride Program.

Continuing, Ms. Wiswell explained Decision Unit M-200 in the TA budget request recommended one new Vehicle Inspector position and one new Management Assistant II position to address projected growth in the industry.

Ms. Wiswell explained there were numerous technical corrections in both the TA and TSA budgets associated with the statewide cost allocations and DoIT cost assessments.

The Chair recognized Mark Stevens, Fiscal Analyst, Fiscal Analysis Division, Legislative Counsel Bureau. There had been earlier questions by committee members as to how the Department of Education would administer the program and how the appropriation would be distributed.

The Chair recognized Mary Peterson, Superintendent of Public Instruction.
Ms. Peterson referred committee members to Exhibit H, a description of peer mediation and conflict resolution programs being recommended in A.B. 382. Ms. Peterson then provided the following verbatim testimony:

• Schools are our society’s primary formal institution for socializing children into their roles as concerned and responsible citizens in a democracy. This is a tremendous responsibility. It involves recognizing that our goals are not only to produce students with fabulous test scores, but students who become fabulous people. We want our children to become knowledgeable, of course, but also responsible and caring. We want our youths to have academic skills, but we also know that life success is based at least as much on emotional intelligence as on intellectual intelligence. We need academic standards to improve our students’ skills in math, literacy, science, and social studies, but we also need standards in life skills so that we are effective in our interactions with others in the workplace, community, and family.

• Violence is preventable. We know that sustained long-term teaching of these skills can help prevent many of the problems such as interpersonal violence that students experience today, as well as foster more caring, cooperative, learning environments.

• Thousands of schools around the country are invested in promoting the kind of learning that will foster children’s social and emotional development. In such schools, pro-social values are visible everywhere in interactions among students and staff. Students constantly reflect on and discuss ways to live together peacefully, to deal with angry feelings appropriately, and to be assertive without being mean. In many schools, student mediators, peer counselors, and youth leaders earn the respect of their peers by helping to keep the peace.

Ms. Peterson advised A.B. 382 recommended a maximum grant of $2,500 to each school or school site and she referred committee members to page H-4 of Exhibit H which provided a list of resources needed to implement a conflict resolution program. The requested appropriation would be expended on those items outlined on page H-4. She pointed out a great deal of attention would be paid to train teachers and faculty coordinators. Those teachers, in turn, would train the student mediators.

The Chair recognized Ms. Giunchigliani who referred committee members to Section 2, line 12, and suggested the following amended language:

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on A.B. 382 closed.

The Chair recognized Steve Shaw, Administrator, Division of Child and Family Services (DCFS), Department of Human Resources. Ms. Shaw told committee members A.B. 519 had been introduced on March 11, 1999 and received a "do pass" out of the Assembly Judiciary Committee on April 6, 1999. Committee members had heard the bill on April 26, 1999. During the 1997 Legislative Session both the Senate Finance Committee and the Assembly Committee on Ways and Means had recommended the Juvenile Justice Commission study the issue of whether or not youth corrections belonged in the DCFS. The commission responded in June 1998 and recommended that corrections remain in DCFS and that a position of deputy administrator for youth corrections be created.

Mr. Shaw explained A.B. 519 went well beyond the creation of a deputy and pointed out there were 56 sections to the bill. Should committee members choose to process the bill, Mr. Shaw recommended Sections 2 through 56 be deleted from the bill. The remaining Section 1 would establish the deputy administrator position. Mr. Shaw had respectfully requested of the joint money committees that $100,000 be "left on the table" in each year of the biennium in Budget Account 3646 to fund the deputy administrator position. That request had been favorably received. Mr. Shaw reminded committee members of the serious and chronic youth offender facility that would be coming on line and the need for there to be a deputy corrections position on site.

The Chair asked if it were true the position requested in A.B. 519 already existed and remained vacant as the result of a transfer. Mr. Shaw replied to his knowledge the position had been moved to the northern office. The Chair said it was his understanding the vacated position dealt with Nevada’s rural areas and the new position was being created to deal with the rural areas. If that were the case, he said, why was it not possible to transfer the person back to the vacant position. Mr. Shaw told committee members he was not "trying to pull a fast one." He explained the position had been transferred, with the knowledge of committee members, to the Northern Region Deputy position. The position had been vacant for 9-months because no one would go into the unclassified service and take a pay cut. Mr. Shaw said his predecessor had a plan to integrate juvenile justice with social work. He did not agree with that plan and determined serious and chronic youth offenders needed to be supervised by correctional professionals.

The Chair requested Don Hataway, Deputy Budget Administrator, Budget Division, Department of Administration, provide an explanation of the bill.
Mr. Hataway advised committee members the deputy corrections position had not been recommended in the agency’s budget and he had not received any direction from the Governor. He said the budget office would look favorably upon the addition of the position if the agency had a separate source of revenue to support the position. Mr. Shaw told committee members he had not supported the position early-on in the legislative process because it was not included in the Governor’s budget.

The Chair recognized Mr. Marvel who felt it was important to have correctional supervision of chronic and serious youth offenders in an attempt to keep them out of the prison system. Mr. Shaw told committee members he held a social work license and had been a juvenile probation officer. He felt strongly that juvenile corrections should be supervised by a corrections professional.

The Chair recognized Ms. Leslie who asked if the idea had been discussed in the ACR 57 interim committee that Vice Chair Evans had chaired. Mr. Shaw said that he believed that it had. Ms. Leslie commented that she agreed with
Mr. Marvel in that the corrections position was necessary. She personally felt that both the Elko and Caliente facilities required more attention in terms of rehabilitation.

The Chair asked if the subcommittee that Vice Chair Evans had chaired had recommended the deputy corrections position. Mr. Shaw explained the joint subcommittee had been chaired by Senator Rawson and the Senator’s statement at that time was that the matter would be handled in A.B. 519, the agency’s budget, or the Unclassified Pay Bill. The Chair clarified he was asking if the recommendation had been made in Vice Chair Evans’ interim study committee, not the subcommittee.

The Chair recognized Mr. Hettrick who also agreed the position was necessary.

The Chair recognized Ms. Giunchigliani who believed the idea had surfaced in the ACR 57 interim study committee but that no recommendation had been made. She told committee members Ms. Evans had requested, and it had been agreed, the study committee would continue.

The Chair asked if there was further testimony in opposition to, or in favor of, the legislation. There being none, the Chair declared the hearing on A.B. 519 closed.

There being no further business, the meeting was adjourned at 10:53 a.m.

RESPECTFULLY SUBMITTED:

Debbie Zuspan,

Committee Secretary

APPROVED BY:

Assemblyman Morse Arberry Jr., Chairman

DATE: