MINUTES OF THE meeting
of the
ASSEMBLY Committee on Elections, Procedures, and Ethics
Seventy-Second Session
May 27, 2003
The Committee on Elections, Procedures, and Ethicswas called to order at 4:00 p.m., on Tuesday, May 27, 2003. Chairwoman Chris Giunchigliani presided in Room 3138 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
Note: These minutes are compiled in the modified verbatim style. Bracketed material indicates language used to clarify and further describe testimony. Actions of the Committee are presented in the traditional legislative style.
COMMITTEE MEMBERS PRESENT:
Ms. Chris Giunchigliani, Chairwoman
Mr. Marcus Conklin, Vice Chairman
Mr. Bernie Anderson
Mr. Bob Beers
Mr. Chad Christensen
Mr. Tom Grady
Ms. Kathy McClain
Mr. Bob McCleary
Ms. Peggy Pierce
Ms. Valerie Weber
COMMITTEE MEMBERS ABSENT:
None
GUEST LEGISLATORS PRESENT:
Assemblyman David Parks, Clark County, District No. 41
STAFF MEMBERS PRESENT:
Michelle Van Geel, Committee Policy Analyst
Kelly Fisher, Committee Secretary
OTHERS PRESENT:
Tim Hay, Bureau of Consumer Protection
Steve Schorr, Vice President, Cox Communications
Steve Tackes, MCI WorldCom, Eshelon Telecom
Russell Rowe, Churchill County Communications
Jim Endres, representing AT&T
Mike Turnipseed, Director, Department of Conservation, Natural Resources
Chairwoman Giunchigliani:
We’ll call the meeting to order. [Roll called]. We will begin with A.C.R. 19. I believe Assemblyman Parks and Mr. Hay will present this resolution to us.
Assembly Concurrent Resolution 19: Directs Legislative Commission to conduct interim study of telecommunication services in Nevada. (BDR R-1188)
Assemblyman David Parks, Clark County, District No. 41:
A.C.R. 19 was a bill draft that I had requested. My interest in this issue dealt with a number of different things, but perhaps most importantly is the changing nature of the telecommunications industry and the way things are happening very rapidly. I felt it was necessary that we look into not only what’s happening in the industry, but also how it is being regulated by the government of the state. With that, I’d be happy to proceed through the bill, but I think it’s fairly self-explanatory for an interim study request.
Chairwoman Giunchigliani:
We do have some language in our work session document (Exhibit C, Tab A); perhaps you could talk about the amendments.
Assemblyman Parks:
An amendment was proposed and it was discussed; this was a bill already heard in the Assembly Commerce and Labor Committee, and it was moved out of there yesterday to the Elections, Procedures, and Ethics Committee. There was some degree of discussion with regard to some possible changes to A.C.R. 19. I certainly don’t see any areas that I have any difficulty or problems with [in the work session document]. As far as the revisions go, as I indicated in Commerce and Labor, I had no pride of authorship in the specific language to A.C.R. 19. With me is Mr. Tim Hay. He has some comments he would like to share.
Tim Hay, Bureau of Consumer Protection:
I think the important policy issues for the Legislature to be aware of in the resolution is that, due to the changing nature of telecommunication regulation in the state of Nevada and the dramatic impact it may have on the citizens that our office attempts to look out after, the small businesses and residential consumers, it’s important to have this sort of a study conducted during this interim. The work session document does incorporate the suggestions we have made.
Assemblyman Beers:
The switches, the services seem not as much like a commodity as electrons in electro deregulation. Do you have that impression as well?
Tim Hay:
I think you bring up a good point. There is a much different regulatory paradigm that you can apply to telecommunications than you can to the electric or gas utilities. Obviously, we’ve got some degree of intermodal competition in broadband, at least until you can get your broadband through cable. You can get it through a DSL line. Some subscribers can take it from a satellite dish. So, from that standpoint, you have a different nature of an emerging competitive market. We think the important thing is to make sure that the state’s regulatory policy ensures that competitive market remains competitive and grows more competitive over time. I think this is one of the issues that the interim committee can be helpful in determining whether we’ve adopted the appropriate policy, whether the state should do more to encourage competition or to correct market abuses that may occur down the road. Obviously, the technology is changing much more rapidly than we’ll ever see in the electric or gas industries.
Assemblyman Beers:
I also came away with a feeling that in this area, we’re almost competing for a regulatory authority with the feds. In your opinion, what percentage of authority lies with the state versus the federal government?
Tim Hay:
Unfortunately, I can’t give you a real comprehensive answer to that. As you know, the FCC tentatively adopted an order in late February that was their declaration on the appropriate split of regulatory authority between states and federal government for broadband and other issues. That order is yet to be published, although the anticipation is that it will be out by mid-June. We’ve heard various dates since the FCC took their action. The original consensus opinion was that the FCC was going to retain more authority at the federal level over the regulatory decisions. As the deliberation and the split vote at the FCC ended up indicating, they’re actually going to delegate substantial regulatory authority to the states, which is one of the reasons why we were somewhat uncomfortable with moving further away from having our PUC (Public Utilities Commission) have the authority to regulate areas as it will under S.B. 400. There definitely is a split of jurisdiction. I believe it was a 3-2 vote at the FCC that that particular pendulum has moved a tiny bit more towards the states retaining regulatory authority, which is also a position that my office as well as the consumer advocates group nationwide, took. It was a contentious order and a split vote at the FCC.
Assemblyman Beers:
If we did this study – We’ve got a list that we need to decide between, but this also involves local regulatory authority in that the cable operators operate under a local government franchise.
Tim Hay:
That’s exactly correct. Since the cable companies are a direct intermodal type of competition on the broadband side with a larger market share than a satellite broadband provider, that group of issues needs to be looked at, as well. I don’t believe there’s a provision in here for a cable representative, but that might be one addition the committee might be comfortable with. The other alternative to that might be having a member appointed just to represent emerging technologies or a similar approach so that as satellite and other sorts of providers do enter the marketplace. You’ve got all of the provider viewpoints represented. We’re concerned with how those different mechanisms compete and what the impact is on the pricing of DSL and other advanced services for residential customers. Even though we don’t consider them basic services, I think for the retired population in Las Vegas and others, it’s becoming more and more comfortable, if not total necessity, to have a broadband connection. Obviously, the more ways you can get that, and the more economically you can do that, the state’s public interest to serve.
Chairwoman Giunchigliani:
Bob, would you make note of the suggestion if you’re interested in that when we take it up for work session. In other words, note what you might want to add regarding the emerging technologies?
Assemblyman Christensen:
Reading this resolution, we’re obviously talking about regulatory authority. Also, it mentions here in point number 2 on the first page, lines 19 and 20, by making a reference to the Attorney General’s Office. In light of this regulatory authority, have you spoken to the Attorney General’s Office about this. If so, where are they?
Tim Hay:
I didn’t catch the line reference. Could you repeat that for me?
Assemblyman Christensen:
It’s at the very bottom of the first page. That just refers to a member appointed. The question in my mind is, have you spoken to the AG’s office and, if so, where are they with regards to this resolution?
Tim Hay:
As far as I’m aware, the Attorney General has not taken a position on either this or S.B. 400 as an interim committee. The precedent for this is that our office has been the appointing authority in other similar interim studies and in some cases permanent bodies, but I’ve not directly discussed it with the AG.
Assemblyman Christensen:
As far as carrying out the provisions in the resolution, don’t they have to dedicate resources to the members appointed by the Office of the Attorney General?
Tim Hay:
We offered in front of Commerce and Labor to provide what technical assistance both the interim committee and the advisory committee may need as far as compiling data from providers and the normal sort of background data that you’d need to start a study from some sort of baseline that everybody agrees to, so that at least the data is correct. We have the technical capabilities within our office to do that.
Assemblyman Grady:
Mr. Parks, I know you’ve been working with all the parties on this issue. On the proposed amendments on page 3 of our document, as proposed by the Bureau of Consumer Protection, have all the players agreed to that language?
Assemblyman Parks:
Those proposed changes were also a compilation of some other suggestions that had been made by some of the other providers, in consultation with the Bureau of Consumer Protection. I’m very comfortable with those.
Assemblyman Conklin:
Do either of you have reason to believe that the current pricing of broadband is not being set by market forces?
Tim Hay:
As broadband is becoming more widely deployed, particularly in Clark County, we essentially, for practical purposes, have a duopoly that either broadband subscribers can take the service through Sprint, the incumbent local telephone company, or through the cable company down there. I’m not an economist, but if you talk to most economists, they would tell you that a duopoly does not necessarily result in the most efficient pricing mechanism. In fact, it may establish higher prices than would be found in a more competitive marketplace. I think that’s one of the issues that the interim committee, with the appropriate data available, can examine. There are some municipalities in the Midwest that found they were not having adequate price competition, and actually municipalities were able to offer themselves DSL, or similar service, for about half the price that either a cable company or phone company would. As an emerging market, I think the pricing issues that we’ll be talking about in 2005 may be very different than what we see in the marketplace today. We don’t really have a good answer to that question.
Assemblyman Conklin:
Is there another state adjacent to Nevada that has lower pricing than we do?
Tim Hay:
Specifically, just for DSL service?
Assemblyman Conklin:
For broadband, period, or for home use at least?
Tim Hay:
I’m not aware of the pricing in all of the surrounding states. That would certainly be some data we could collect and get back to you. Obviously, SBC is a dominant provider at least in northern California. Cox Cable has substantial presence in southern California, particularly in San Diego. I’m sure they have representatives here that can tell you about their pricing much more adequately than I can. I don’t have the data to answer your question at this time, but we can certainly attempt to ascertain that.
Assemblywoman Pierce:
What falls under the definition of telecommunications? Telephone, cable, anything else?
Tim Hay:
The components of telecommunication service can range from a basic landline telephone to sophisticated data provision that may service a bank credit processing facility. It runs the gamut and obviously we’ve got cell phones. Some consumers are banding their landlines and taking all the service they’ve got. It’s a broad tent, although the emphasis behind Assemblyman Parks’ resolution is really to look at the issues that derive from the deregulation of broadband as expressed in S.B. 400. There are a lot of policy issues that reflect around that as well, such as if you need to establish a mechanism to enable a less affluent customer. Maybe a retired person on a fixed income can get broadband services or something equivalent similar to the way we do basic services now, which were essential at the time that those laws were enacted. It’s a very large arena and as Assemblyman Beers indicated, the regulatory authority is bifurcated, or in some cases trifurcated, depending on which agencies are dealing with the issues.
Assemblywoman Pierce:
This is not cable television, or is it also cable television?
Tim Hay:
The regulatory paradigm for straight cable TV service was deregulated by federal efforts a long time ago, so local franchises do that. The policy issue for this legislative body to consider is as cable companies start providing DSL equivalent services, broadband services, and/or voice over cable, you’re going to have a different regulatory environment for the customers that happen to want to take those services from an unregulated provider, or at least one that’s regulated at the local level through franchises, [by way of] the traditional telephone companies. That was part of the emphasis behind S.B. 400, as it was originally intended to allow the ILECs to compete more effectively with these emerging technologies. We thought, from a regulatory standpoint, it was a premature judgment to make. I think you’ve correctly identified one of the policy issues that you’ll be dealing with for several sessions.
Assemblyman Parks:
About 15 to 20 years ago, I did some work relative to the cable industry and regulation of cable at the county level. Less than two years ago, I went to what’s called a fix based wireless system, for both primary phone and for my DSL. The cost, to answer Assemblyman Conklin’s question, was that the rate, when consolidated, was quite a bit less expensive as far as that unregulated package went with AT&T. Unfortunately, about six months after they installed it, they pulled out of Las Vegas and left me with having to go back with the regulated carrier for phone without my DSL connection system.
Assemblyman Conklin:
Why did they leave the market? Because businesses are out to make a profit and if their rates are so low, to me that begs the question, it’s only confirmation from a business perspective that you can only regulate a business so much, you can only transfuse so much competition, but in industries like this, where the initial investment is so high, hundreds of millions of dollars that not everybody can play in that game, so you’re left with several scenarios. Do we let the people who can play, in this case there’s two, and I understand there’s a pricing sacrifice there, because there’s only two competitors? It would be nice if there were a hundred. There’s only two, because there’s only two out there with the wherewithal to invest in our market to deliver these services. Or, do we regulate the industry in such a way like we did with the telecom, one company comes in, invests in the market, puts down all the infrastructure, and then is forced to sell it a reduced rate to competition, or at a loss. How long can that happen? It’s a matter of philosophy and concern, so I’ll have to grapple with it myself.
Tim Hay:
As you know, the Federal Telecommunications Act of 1996 was the one that provided that local companies had to offer their facilities to competitors to encourage a competitive marketplace. There are a million different theories on how those components should be priced. Many people would tell you that competitors such as the one that Assemblyman Parks described become victims of predatory pricing in a market. The market share of an incumbent is so overwhelming that they’ve got the ability to prevent real competition from developing. I think the consensus is that the Act has not been nearly as effective as the federal legislators intended it to be. I don’t think that’s a reason that we shouldn’t try to encourage competitive marketplaces with free pricing and preventing price gouging of one kind or another, or predatory pricing on the other end of the spectrum.
Steve Schorr, Vice President, Cox Communications:
Cox Communications has not played a role in the debate on S.B. 400, except to the extent to protect the agreements for which we worked very long and hard hours on the Senate side. Therefore, the inclusion of the passage of A.C.R. 19 was not something we were directly involved in. I want to make that clear to the Committee. In great respect to the Chairman of that committee, Assemblyman Parks, and to the respect to our consumer advocate. The issues, as we see them, are different than what we saw initially, when A.C.R. 19 was brought about.
In light of the possibility that the interim study is approved, we are in opposition to some of the amendments proposed by the consumer advocate. We believe the amendments bring the debate into the retail broadband realm, and into issues that are currently deemed unregulated and widely believed to be competitive and therefore regulated by the marketplace. I say that specifically to broadband. During the debate that took place on S.B. 400, there was a multiplicity of arguments that came forward to whether or not more regulation or less regulation is what the marketplace needs. In all due conscience and looking at the initial A.C.R. 19, I believe that was the correct decision. To look at whether or not there needs to be regulation within that marketplace.
The marketplace for broadband competition is completely different than the marketplace for telephone competition. If you were to look at microcosm, especially in southern Nevada, of what the broadband marketplace now offers. It is my belief that you will see a truly competitive marketplace. You cannot read a newspaper, you cannot scan a magazine, you can’t listen to a radio, you cannot watch a television without seeing an advertisement from a broadband provider who either wants my business, I want their business, everybody wants everybody else’s business, because it is a competitive marketplace.
The retail end of broadband has not been regulated for a long period of time. It has been the marketplace that has driven that. Currently, my pricing for broadband is more than the pricing for my primary competitor. It’s because we have different services and because of what the marketplace is now demanding. Without seeing the competition as it really is, and that is a full broadband competitive marketplace, I think you cannot see what the amendments for A.C.R. 19 do. I have a serious question of why the state seeks to encourage investment in the broadband marketplace. That’s up to the companies as far as I’m concerned.
Firms like mine have made the investments within the infrastructure to be able to provide the services that we provide without a guaranteed rate of return, without a guarantee of customers, but because we believe it is the proper thing to do within the marketplace. Our investment is now over $350 million just in the broadband infrastructure in southern Nevada. It continues to grow on a weekly and monthly basis. If you’re a competitive company, like mine, in the broadband field, you need to provide the services that the customers seek, and what they want. We are one of only 5 percent of all broadband companies in the country that offer what is called a quality of service. Quality of service is not the service that we provide, but the way we provide it. The quality of service, in our case, is a multiplicity of types of services that you, as the consumer, can get. One of the biggest things we have invested in is the ability to offer 3 megabyte service to the residential customers of southern Nevada. Three meg is a lot of pipe coming to someone’s house. If the old 56K modem is about the size of this pen coming to your house, 3 megs would be the size of a sewer pipe coming into your house. It is that much bigger. We, as a company, have designed our system from the very beginning that we can offer various levels; 3 megs, 1.5 megs, and all the other levels that go along with it. Only 5 percent of the companies in America do that because of the cost of doing business.
Today, Wall Street continues to look harder and tougher at allowing the capital dollars to be reinvested within the marketplace. When Cox Communications first got into the broadband business, we serviced 1,200 homes per node. Node is that one area within a community that then fingers out into the residential homes. Today, the cost of the competitive, we’re now down to 500 homes per node. That means your ability to get the service bigger and better becomes more reliable. We are now 5/9 reliability in service to customers. That comes at a cost of money. Again, going back to what I said earlier, that’s not because somebody said, is it the right thing to do to invest within the marketplace. It’s what the company decided is the best thing to do to serve the southern Nevada residents.
We have built our system ourselves. I think, in looking at the interim study committee as far as broadband deployment, I honestly believe it’s getting into a realm that it should not be in. That’s the competitive marketplace itself. There’s a caveat to that. I’m proud to say I’ve been in this state for 27 years. I know there is a differential between our rural communities and the urban communities. The rural communities in Nevada, unfortunately, do not have the availabilities that the urban communities do. I would not as much have a problem within this amended resolution as it looked at what the state needs to do to make the broadband marketplace competitive within the rural communities. I think in the urban communities in our state, it already is competitive, it is a fight on a daily basis for customers and consumers. I think there’s not a need for the state to get into that.
I will close by saying that it is my belief that if this Committee processes A.C.R. 19, either with or without the proposed amendment, I think my industry, specifically the cable telecommunications industry, should have a place on that committee, because I think that’s where the competition is for the future. Not just in broadband, but in telephony. I think if this Committee is to look at what is happening with our state, then we should have a play at it. I would love to see a representative from Cox Communications on that committee. It should be a representative from our competing marketplace, to at least have a say into what takes place, and to maybe give that committee some insight into what might be forthcoming in the future.
Chairwoman Giunchigliani:
So Steve, you’re objecting to all of the amendments that have been suggested? [He indicated he was]. Was there any objection noted in the Commerce Committee when they were presented there?
Steve Schorr:
As I stated, we were not involved in that except to make sure that what we had negotiated in good faith with the primary ILECs (incumbent local exchange carrier) was not harmed in any way because we felt as though that would be wrong on our part.
Chairwoman Giunchigliani:
Right. I appreciate that, because I had to leave the room when we voted on S.B. 400. I don’t intend on voting on it still, because I don’t want to vote for deregulation items. I do understand that Cox Cable was taken out of it by the amendment in the Senate which caused a neutral position to occur. Now I’m concerned that as we try to look at the issue it parallels S.B. 400, so we can deal with what is happening in the market or not happening, as far as that’s concerned. I’m not quite sure where you would be impacted, or what this language does. Maybe you need to help me be clear on this.
Steve Schorr:
We were not amended out of S.B. 400. We were never in S.B. 400. What we specifically worked on was the language of what broadband communications was with the help of attorney Gardner Gillespie of Hogan and Hartson, who directly worked on the Telecommunications Act of 1996. By most people in the country he is considered one of the foremost knowledgeable people on that [issue]. We put forward those things specifically that dealt with the broadband language. We were not opted out of that because we were not in it to begin with. The specific parts of the amendments that I see in A.C.R. 19 is 6 and 7 that talk about how investment in broadband networks can be encouraged and the methods to promote the deployment of affordable broadband services to all classes of consumers. It is my belief that’s being done today by the marketplace, because it is the marketplace that is driving broadband competition. Whether it be Cox Communications, whether it be Sprint, SBC, Net Zero, or any of the other companies. It’s the marketplace that is driven, and it continues to drive that forward.
When you look at what the basic idea of what A.C.R. 19 is, it’s to look at the potential of regulation. I don’t see where that even comes into play in a competitive marketplace that is currently out there today. As to 1 and 2, I don’t see any problems with that specifically; my issues really are 6 and 7, and the scope of regulation of telecommunication services and products to promote in orderly transition to a competitive marketplace. I think that’s basically what A.C.R. 19 will do in its original form.
Chairwoman Giunchigliani:
Thank you, but I think part of the issue was that apparently people felt there wasn’t a choice and that was the whole reason S.B. 400 came around. We thought there was a competitive market, but maybe there isn’t a competitive market. While you may have a belief, others may not have a belief. Part of this is not an infringement on anybody. If it’s working, let’s make sure it’s working and expand that if that’s the case. If it’s not working, we need to know where we don’t have competition.
Steve Schorr:
I think with the question of broadband, a deployment specifically in regulation thereof was by the CLECs (competitive local exchange carrier) who had a question about the potential of deregulating the business end, the wholesale end, because if you’re a CLEC, and you’re looking to provide a competitive marketplace, you need an entrance to that. They see that entrance without investing within the infrastructure as that portion of the ILECs broadband. That’s where they did not want to see deregulation, and that’s what they came back. It never was the retail marketplace, it was the wholesale marketplace.
Chairwoman Giunchigliani:
I’ll ask Mr. Parks to take a look at a simple way to look at some methods to promote broadband services to consumers. Affordable is the key issue I think they were trying to take a look at. If I could ask you two gentlemen to talk about that?
Steve Tackes, representing MCI WorldCom and Eshelon Telecom:
I’ve practiced in telecommunications law for about 20 years now. I am very much in support of A.C.R. 19. I have testified extensively on S.B. 400. Some of you heard that testimony. Those of you who did hear a lot of dispute as to what should be included in the definition of broadband and what should not be included. What I see in these amendments to A.C.R. 19 appears to be a good-faith attempt to deal with some of those issues that arose in the context of arguments of S.B. 400, for which there were not clear answers. I, among others, had done a compilation of what the market share is for competitors versus the incumbents. There were other members of the telecommunications community that took issue with the percentages that I came up with looking at state records.
In the 20 years that I’ve appeared before the Legislature on these issues, I don’t recall an interim study on telecommunications. I think it’s time to find out what’s really out there, what works in terms of encouraging competitive services, good prices for your constituents, good service for your constituents, and that’s what I see A.C.R. 19 doing. I think it’s something that’s long overdue. As to the issues raised by Mr. Schorr with Cox, I sympathize with some of his concerns, and I think that those probably could be addressed with some discussion with the bill sponsor. I think it’s important that the interim committee address what the level of the competitive marketplace is. What is really going on out there? What works? What doesn’t work? A lot of the debate on S.B. 400 turned on broadband.
Some of us understand broadband to mean access to the Internet. In fact, I think that’s the most common understanding of what the term means. You can get DSL from the telephone company, or you can get a cable modem from the cable company. However, in S.B. 400, we’ve defined “broadband” as a broader term than simply access to the Internet. It’s any service, which transmits over 200 kilobits in one direction, which means that it’s many of the business services, if not most of the business services that are out there. As a result, it’s very important for the Legislature to look and see what kind of competition is going on out there. Because, if customers don’t really have a choice, the end result is that you have a monopoly that will be able to extract a monopoly profit.
On that note, I would also like to respond to a question from Assemblyman Conklin, who asked if the prices are different in different areas. Yes, they are, very much so. Even within SBC’s service territory. In areas where they experience competition, for example, for the kind of broadband that most of us think about, access to the Internet, their rates are lower in areas where they are not.
For example, here in Carson City, when SBC did a national rollout of their DSL product, it was $39 a month. We subscribed to it at my household because we didn’t have cable TV access at our house. Coincidentally, a year later, cable access became available to our house and the cable company offered the equivalent product over the cable modem for $45. The next thing we knew, SBC raised the price of the DSL access to $45 at our house. So, there is something going on. I don’t know what it is, but certainly it is not unfair to look at the competitive marketplace and see what’s going on, determine what’s working for your constituents in terms of offers of products and pricing. I would leave you with support of A.C.R. 19, as amended.
Assemblyman Conklin:
The question wasn’t whether within regions within our state prices varied. Of course they’re going to vary, and of course competition changes the price being offered, because all markets should operate in a condition of supply and demand. The question specifically was, in the state of Nevada, does the average consumer pay more or less than other states adjacent Nevada. I think you might find that the answer is probably yes, that we do pay less. We’re talking about a complicated market structure, particularly with broadband, which currently is unregulated. I guess I’m only questioning whether there is a need to have this sort of study, or maybe we should be spending our money on some other study where there’s a proven need to that maybe we pay higher prices in.
Steve Tackes:
I was referring to us versus areas of California. There are areas of California where you can get DSL Internet access for $39 a month. Here in Carson City it’s $49 a month. I believe in Reno it’s $49 a month. I think across some market areas, and that’s within the same company, that’s SBC, I don’t know on average, whether we’re paying less or more than other states. It could very well be that we’re right in there in the norm. I guess the biggest concern I have, and I’m sensitive to Mr. Schorr’s testimony, it’s not so much the access to the Internet that concerns me, it’s all the other services that are included in the definition of “broadband.” Those are services that have not been deregulated. Those have been tariffed by the Public Utilities Commission for the last 100 years. Well, a lot of those services haven’t been around for the last 100 years, but since they were introduced they were tariffed by the PUC. Those services are services, which under S.B. 400 will no longer be regulated. Somebody needs to see what’s going on. That’s really the substance of my testimony.
Russell Rowe, Churchill County Communications:
Churchill County Communications is a small telephone provider in rural Nevada, Churchill County. We asked the Commerce and Labor Committee that a member of one of the rural providers be a part of this advisory committee. My understanding is that is part of the amendments that have been proposed and passed out in the work session document. We support the amendments, but my only concern about saying that is Churchill County Communications didn’t have a position, one way or the other, in S.B. 400, so we don’t want to give an impression that some of the concerns of the other parties involved here with A.C.R. 19 should not be considered given our support of the amendments as they’ve been drafted here, only to say that we support having a rural provider on the advisory committee.
Jim Endres, representing AT&T:
Like Steve Tackes, I’ve been kicking around the Legislature doing a lot of telecommunications for a number of sessions. This session was not too much different from those where we had some very interesting and heated debates at some points on telecommunications matters, on telecommunication status, what is the status of telecommunications competition, and what is the best policy for the state of Nevada as it relates to how do we regulate or not regulate that industry, or certain parts of that industry. AT&T would like to say that we do support the amendments as being proposed this afternoon by the Consumer Advocate’s Office. I’m also hopeful, and I have been very sensitive to Mr. Schorr’s concern with respect to broadband issues, because broadband was clearly one of the most heated debated issues in the context of S.B. 400. I think we can find some resolve to address Mr. Schorr’s issues.
Also, I do believe it’s appropriate to be more inclusive of this advisory committee. Mr. Hay did suggest an advisory position dealing with emerging technologies, and Madame Chair, to your comments yesterday and to Mr. Parks’ comments this afternoon dealing with wireless, I think it’s an appropriate place that the wireless industry be at the table on this matter. I think fixed wireless is clearly going to be among other, emerging technologies that are going to deliver a wide array of services in competition with all of the other technologies. That information, together with the information that all of the parties can bring to the table, will help the state, will help the Legislature, will help the industry better understand and better direct how we should regulate or forbear from regulating and how we can move public policy with respect to telecommunications in the state of Nevada. I think this is a wonderful resolution being brought forward at this time, given where we are with emerging technologies and given where we are with all of the debates we’ve been having on telecommunications in the state of Nevada. We do support A.C.R. 19 as amended and are hopeful that we can accommodate some of the concerns brought up this afternoon by Mr Schorr.
Chairwoman Giunchigliani:
I have no one else signed in. We’ll close the hearing on A.C.R. 19. If I might ask the parties to get together. Maybe the advisory committee should be a little larger, maybe not more than 9 members. We might want to make sure that we cover who should be participating, maybe talk about Mr. Schorr’s concerns to see if we can balance that language so people don’t become fearful about it. If we don’t resolve it tonight, we can take it up later. We will open the hearing on S.J.R. 11. Senator Raggio is in Senate Finance, so he’s asked me to introduce the bill.
Senate Joint Resolution 11: Proposes to amend Nevada Constitution to provide for payment of compensation to members of Legislature for each day of service during regular and special sessions and to provide for payment of reasonable allowances to such members for postage, express charges, newspapers, telecommunications and stationery. (BDR C-1353)
It’s a different approach. I think it makes sense. It’s timely, and regardless of whether annual sessions move forward, I think it’s high time the people at least get paid for the days they work. I think Lucille Lusk has also submitted a potential amendment (Exhibit D). I’ve sent that down to the Senator for him to take a look at. Mrs. Lusk’s amendment would establish a specific 20-day limit on the duration of the special session of the Legislature. Apparently, she did recommend this to the Senate and they did not accept the amendment at that time.
Assemblyman Conklin:
Is there another bill out there?
Chairwoman Giunchigliani:
There’s a legislative commission in Ways and Means. What we voted out in Ways and Means was to increase our actual salary, which is on the Floor, but there’s nothing to actually deal…
Assemblyman Beers:
Actually, Madam Chair, that is on the Chief Clerk’s desk. I think I noticed that.
Chairwoman Giunchigliani:
So, that’s on the desk. This is the only one out there that deals with compensation for days that you actually work.
Assemblyman Conklin:
Then this amendment isn’t really germane, and if the process would be that this would have to go to a vote of the people, and I think it would be really confusing to have this, plus this, which isn’t germane, on the ballot.
Chairwoman Giunchigliani:
At least not complementary. I would agree, and that’s probably why the Senate did not accept it. Michelle Van Geel said that she was listening during the testimony, and that is correct.
ASSEMBLYWOMAN PIERCE MOVED TO DO PASS S.J.R. 11.
ASSEMBLYMAN MCCLEARY SECONDED THE MOTION.
THE MOTION CARRIED.
Let’s go into our work session document (Exhibit C). We have Assembly Concurrent Resolution 14. This is one that I actually submitted after working with the clerks during the interim session. What I’m going to suggest is that we only have three study committees. One of them we’ve already passed out and we’ll be making some recommendations for some others tonight. I might suggest turning this into just a subcommittee to be appointed by the Legislative Commission. Then it doesn’t count against one of our interims. Since it’s mostly made up with the clerks and the Secretary of State’s staff, take a look at it, tell me if one member from each house is appropriate, or if you’d like legislators from each, so it’s a little bit of a more workable committee. So, it’s A.C.R. 14 (Exhibit C)
Assembly Concurrent Resolution 14: Directs Legislative Commission to appoint subcommittee to study election, ethics and campaign laws in this state. (BDR R-684)
Would you like to change that to at least two then, on lines 14 and 16? Then I might suggest that if the Committee is willing, then look at line 12, and at the directed to appoint a subcommittee to conduct a study. Then we would delete “interim.” Then change it to two members from the Assembly and two members from the Senate. That way it doesn’t count against our list. It needs to be done, but it probably doesn’t warrant the depth that some of the other ones do that we may consider.
ASSEMBLYMAN CONKLIN MOVED TO AMEND AND DO PASS A.C.R. 14.
ASSEMBLYMAN CHRISTENSEN SECONDED THE MOTION.
THE MOTION CARRIED.
Michelle Van Geel:
The second item in the work session document (Exhibit C) is Assembly Concurrent Resolution 18.
Assembly Concurrent Resolution 18: Directs Legislative Commission to conduct interim study of juvenile justice system in Nevada. (BDR R-1285)
It was heard in Committee on May 13. It would direct the Legislative Commission to study various aspects of the juvenile justice system, including community-based programs, after care, reintegration of youth, overrepresentation of minorities, gender specific services, and quality of care. No formal amendments were proposed.
Chairwoman Giunchigliani:
Let’s discuss the makeup of the committee. Let me get your feeling. I think this one would warrant some in depth. The Senate is going to do one just for rural justice systems, which does not conflict, and actually would then give us a full wraparound picture of what services are out there. This actually would be a good complementary standalone interim. Senator Washington was telling me that they were looking at one of their studies as being S.C.R. 32, conducting a study of the criminal justice system in rural Nevada and transitional housing for offenders. So, what do we have so far? You have three members from the Assembly and three members from the Senate from the various geographical [regions of the state]. Is that a workable committee, Mr. Anderson? Not ever serving on a juvenile interim study, I don’t know if that’s appropriate, or if you’d like it larger, or what your thoughts are.
Assemblyman Anderson:
This is an appropriate size. This committee has met a couple of times in the past. In fact, one of the recommendations was that it should become a standing committee, but knowing the Chair’s dislike for such, it didn’t happen. [Based on] the need for this, however, at this particular juncture in time, I think it is the right size, it’s a workable group, there is the interest in it, but as a result of a couple pieces of legislation that was past this time, and because of the demonstration of problems that have happened in Elko and in Caliente, I think that is most appropriate. In the past, it’s had a really good mix of not just Judiciary members, but also Ways and Means members, so that it’s not really relative to a particular committee.
Assemblyman Grady:
My son does work in the juvenile justice system in Winnemucca, but I don’t think this would affect him any different than any other person involved.
Chairwoman Giunchigliani:
It might even help him, because we found out from the school district records that go with a student to courts versus courts when they send – we have a huge breakdown. That affects the employees when they don’t even know what some of the requirements are, what the IEP (Individual Education Plan) might be, what the medications might be. I’m hoping that there would be good recommendations that come out of here that would really look at streamlining that and making somewhat like we did when the foster care committee met over that time period, as well.
ASSEMBLYMAN ANDERSON MOVED TO DO PASS A.C.R. 18.
ASSEMBLYMAN CONKLIN SECONDED THE MOTION.
THE MOTION CARRIED.
[Chairwoman Giunchigliani reopened the hearing on A.C.R. 19]
Assemblyman Parks:
We did meet outside the Committee room and I think we have a easily workable solution. Our recommendation would be for your Committee to move and do pass A.C.R. 19 as reflected in the work session document, with the following changes: Increase the Advisory Committee to include three additional members. Those members would represent emerging technology, cable communications, and wireless technology. The further change that was recommended would be on line 9 of your work session document, page 3, the comment was it says “telecommunication services, since the passage of S.B. 440 of the Seventieth Legislative Session,” I think you want to add the work “of the 1999 session,” or reference thereto. Finally, it was felt that if the further amendment, line number 10, 11, and 12 for number 6, if that would just simply remove that everyone was in concurrence.
Chairwoman Giunchigliani:
And you’re okay still with item number 7. So, we’d be deleting number 6 and renumbering 6 and 7.
Assemblyman parks:
That is correct. Number 7 and number 8 would remain.
Chairwoman Giunchigliani:
So, you would be expanding the advisory to not more than 9 members. Does anybody have an objection? Maybe the easiest way is just to say the Speaker and Majority Leader will appoint and then just have a group and they could decide whom they want rather than how it’s outlined here. I think if we say Mrs. Majority Leader, you can only do a competitive supplier, but maybe they have somebody else in mind on that list, and they could work it out. I think that makes better sense.
Assemblyman Parks:
I think that’s fine. As you understand, it is an advisory committee to the members who are the elected members of the interim study committee.
Chairwoman Giunchigliani:
Just for the Committee, the reason I deleted the Governor throughout, except for the public person, because generally when they’re interim studies, we control our own house, so that’s just for your own discussion, but I thought the Governor could stay in for the position of the public person. Do you have discomfort with that?
Assemblyman Anderson:
The only other one that we would have to be considering is this one or 27?
Chairwoman Giunchigliani:
Yes, and let’s come back to this one, because I want to finish explaining the rest of this. Let’s jump to A.C.R. 27 (Exhibit C).
Assembly Concurrent Resolution 27: Directs Legislative Commission to appoint interim committee to study business practices of automobile insurance industry. (BDR R-387)
Based on the passage of S.B. 319 over to the Senate, we did include end coil, which is a credit scoring type of program. Contained with that legislation is that the Insurance Commissioner does have to do some review in recommendations and reporting back as kind of a mini study. In talking with the leadership, we felt that if we did a letter to the Insurance Commissioner requesting her to look at A.C.R. 27 and areas that were not reflected in the bill on end coil could be considered as she makes some recommendations back to the next Legislature, if that would be acceptable, rather than an interim study. We’re working on a draft of a letter to bring to the Committee to take a look at.
Assemblyman Anderson:
Based upon that, I would recommend that this be the third interim study and so move to amend and do pass A.C.R. 19, the amendment being the composition of the committee as indicated by the Chair.
ASSEMBLYMAN ANDERSON MOVED TO AMEND AND DO PASS A.C.R. 19.
ASSEMBLYMAN GRADY SECONDED THE MOTION.
Assemblyman Conklin:
Are we taking the amendments that Mr. Parks just told us as well?
Chairwoman Giunchigliani:
Yes. It would include the amendments in your document, with the amendments that Mr. Parks just suggested.
Assemblyman Conklin:
Plus your suggestion that it will read “Majority Leader and Speaker”?
Chairwoman Giunchigliani:
Correct.
THE MOTION CARRIED.
[Chairwoman Giunchigliani opened the hearing on A.C.R. 21].
Assembly Concurrent Resolution 21: Declares that preservation of Walker Lake’s freshwater ecosystem is important to residents of Nevada.
Michelle Van Geel:
A.C.R. 21 has been heard a few times in Committee. There’s a new amendment, under Tab B (Exhibit C), which essentially is the amendment that you had proposed last time with a couple of other deletions. In the summary line in the title, it would delete “in the public interest,” and replace that language with “important to the citizens of Nevada.” On page 4, it would delete the words “and reallocate.”
Chairwoman Giunchigliani:
I made the error last week when I brought that back after merging the two documents to delete the public interest. I think that gave everybody heartburn.
Assemblyman Grady:
I don’t like the resolution, even as amended. I think it puts too much emphasis on one area of our river and lake system. I think that we’re talking probably six or seven “whereases” about Walker Lake and we address the rest of the system in one “whereas.” I’m not sure that where it states in here about the middle of the page, about the fourth item, “Whereas the fishery and recreation activities at Walker Lake have been recognized as a beneficial use of water in the Lake.” I think recreation is recognized as a beneficial use. I’m not sure that statement is correct, but Mr. Turnipseed might want to address that. I have a lot of problems with this whole thing because of the mediation. I just don’t think the resolution is necessary.
Chairwoman Giunchigliani:
And we are quite sensitive to the sensitivity of the area that you represent. Could you go back? Was it on page 1?
Assemblyman Grady:
On page 1, the third “whereas” from the bottom, “Whereas the fishery and recreation activities at Walker Lake have been recognized as a beneficial use of water in the Lake.”
Chairwoman Giunchigliani:
If you go to Tab B, which is now on the second page, that was deleted.
ASSEMBLYMAN MCCLEARY MOVED TO AMEND AND DO PASS A.C.R. 21.
Assemblyman Anderson:
Has Mr. Turnipseed had an opportunity to review this latest draft? He is very knowledgeable about this particular water system, being the former state engineer. I guess my comfort level is such that I don’t want to rock the boat to see anything go over the side. I’m like Mr. Grady in some ways with this particular piece on whether Mr. Turnipseed had read this.
Chairwoman Giunchigliani:
Mike, feel free to come forward. I think he’s got a copy of the document. I did take what he originally worked with Joe Johnson on, but I will remind the Committee that his testimony was that he preferred no resolution. Then, I took the Walker River Irrigations and completely melded the two together.
Mike Turnipseed, Director, Department of Conservation, Natural Resources:
I was formerly the state engineer and worked in the Division for 15 years. I realize that I testified earlier that I’d rather have no resolution; however, it seems that at least the Chair is compelled to pass a resolution. I certainly like the amended resolution better than the original resolution; however, it’s wrong.
On the first page, the second “whereas” on the bottom, it says, “The Walker Irrigation District and Nevada Irrigation District owns and operates Bridgeport Reservoir, located on the East Walker River in California and partly in Nevada.” That’s wrong. Bridgeport is entirely in California, well into California, by about four miles. There was probably some confusion or a melding of the “whereas” on Topaz Reservoir, which is part in California and part in Nevada. There’s no mention of Topaz Reservoir in the whereas Walker Irrigation District operates.
The only other issue I had with the resolution is on page 3, the second “whereas”: “The volume of Walker Lake has diminished by 75 percent since the late 1880s and its continuing decrease is creating a high concentration of dissolve solids that are extremely detrimental and extremely toxic to fish.” That is all true if you put a period there and strike “without an immediate influx of fresh water, the food chain and ecosystem of Walker Lake could be lost in the very near future.” There are no signs to support that last part of the statement.
Chairwoman Giunchigliani:
That’s reasonable.
Assemblyman McCleary:
I’ll withdraw my motion and change it to reflect the geographical issues that he brought up as well as put a period where it says “toxic to fish” and we’ll leave the rest of that paragraph.
ASSEMBLYMAN McCLEARY MOVED TO AMEND AND DO PASS A.C.R. 21 WITH THE FOLLOWING AMENDMENTS:
· PAGE 3, DELETE “AND WITHOUT IMMEDIATE INFLUX OF FRESHWATER.”
· FIX THE BRIDGEPORT SECTION, AS DESCRIBED BY MR. TURNIPSEED.
ASSEMBLYWOMAN PIERCE SECONDED THE MOTION.
Assemblyman Beers:
I just wanted to point out that in continuing the great sacrifice that we all make for legislative life, I took a field trip this weekend and drove the Walker River. You could not tell there was a shortage of water. It was a very busy little brook. Not just with water, but with people as well. Before we vote, I would like to see if the representative for the Yerington Mason Valley is happy.
Assemblyman Grady:
The answer to that would be no. I just don’t think that timing of the resolution, regardless of what we put in it, is beneficial to the interest of the people along the river, from the start to the bottom, two states, and numerous agencies. I just don’t feel that this resolution is beneficial to the progress that they are trying to make.
THE MOTION CARRIED WITH ASSEMBLYMAN BEERS, ASSEMBLYMAN CHRISTENSEN, ASSEMBLYMAN GRADY, AND ASSEMBLYWOMAN WEBER VOTING NO.
Assemblyman Conklin:
I’m in support to get it out of Committee, but I reserve my right to change my vote on the Floor.
Assemblyman Anderson:
As I do.
Chairwoman Giunchigliani:
Okay. One last item, if you go to Tab C, we also had some testimony from Senator Wiener regarding the obesity issue.
Senate Concurrent Resolution 13 (1st Reprint): Directs Legislative Committee on Health Care to conduct interim study concerning medical and societal costs and impacts of obesity in Nevada. (BDR R-25)
In talking to the Chair of the Health Care Committee, there have been several mandates this session that they have to study already. Since Senator Wiener did such an awesome job, she’s basically studied the whole issue and has a wonderful report to issue in and of itself. We thought that it would be better to just get going on them developing a plan. We’ve crafted a rough draft for you to take a look at to send to Joey Villaflor, M.D., who’s the Chairman of the standing State Board of Health (Exhibit C). The new Health Director will be coming on board in August, so then we’ll send the letter to that individual when he comes on board, along with Senator Wiener’s research that she’s done, because this is an important issue. We felt that there was just too many issues going before the Health Care Standing Committee to have to deal with this session. So, if that’s acceptable to everybody then we will firm up this letter. If you have any changes let me know.
Let’s take up S.B. 137 on page 6 of your document (Exhibit C).
Senate Bill 137 (1st reprint): Establishes Legislative Committee on Persons With Disabilities. (BDR 17-700)
I spoke with the disabled community who knows that I have concerns with continually adding standing committees. They agreed that if we wanted to sunset it that would be acceptable. I would suggest to the Committee that if you wish to process this that it be a four-year out, so they could actually get some work and recommendations out, if you even wish to move forward with the standing committee.
We are in the Ways and Means Committee. Bob, we had a bill that we heard from the Senate. It’s the one changing it from the DETR over to Human Resources. I don’t think this would impact this. It was just changing the departments from one place to another.
Assemblywoman Weber:
According to my notes, the purpose was to consolidate existing programs and to not make disabilities or the programs for disabilities an afterthought. There were several sets of testimony that money should follow the patient pathway.
Assemblywoman McClain:
We just took a whole bunch of that stuff and put it in Human Resources, right? Shouldn’t we give that a chance to work before we do another committee?
Chairwoman Giunchigliani:
That’s a possibility. I did talk to the Senate and if we didn’t move this forward, they might be interested in making this as one of their interim studies. That might be an alternative. If the Committee were interested in that, I could talk to Senator Washington, who asked me, and I told him I would tell him today if we were going to move forward with this. We haven’t studied the issue of disabilities in quite some time.
Assemblyman Anderson:
I think we should recommend to the Senate that they take this up as one of their studies as an interim study, rather than as a standing committee. I don’t disagree with the Chair’s opinion that the standing committees have a tendency to not necessarily come up with all the things that are necessary. I know that veterans groups and a couple of other groups have requested these in the past. I think if we started ourselves down this road then there are a couple of other groups that would also want to be included in that. We seem to be much more productive with interim studies rather than standing committees.
Chairwoman Giunchigliani:
Nothing would limit them from making that as a recommendation for next time as well. Okay, I will e-mail Senator Washington and then I will go see him as well on that part of it.
Assemblywoman McClain:
On your list here, the Senate has a BDR that’s not even introduced, so maybe they were thinking that it’s on disabled students and ADA service.
Chairwoman Giunchigliani:
If that might be the genesis and why he said he could handle this along with that. If that’s what they did.
We’ll open Senate Bill 289 (Exhibit C).
Senate Bill 289 (2nd Reprint): Directs Legislative Committee on Health Care to study current challenges of ensuring that adequate health care is available to all residents of Nevada, now and in future. (BDR S-720)
This was Senator Neal’s bill. He came and testified. I think this is one of the reasons we suggested the obesity study not be done in anticipation of this one and nursing staffing, which were the two issues that the Committee has been directed to look at.
Assemblyman Grady:
My notes state that the Nevada Medical Society expressed support for this also.
Chairwoman Giunchigliani:
We looked at long-term care six years ago, but not the actual issue of accessibility and how it’s happening. I think now with the type of increases we’re having, it probably would be worthwhile. I don’t think it was enough of a volume for an entire interim. That’s probably why they wrote it in the way they did.
Assemblyman Beers:
There’s a joke that if we were to socialize medicine in American, where would the Canadians go for their treatment? I presume that’s what we’re studying here with that single-payer system concept. Would that be your interpretation as well?
Chairwoman Giunchigliani:
I wouldn’t have seen the medical society supporting the bill if that was what they interpreted it as. I don’t believe so. To me, a single-payer system is—if you go back to page 2, it elaborates further. The characteristics of the health care market in the state may contribute to increase in cost. For example, because of ruralness in some areas, and both your urban areas, you have rural parts. We only have one HMO that serves only southern Nevada and the rest of the state doesn’t have access. All of those things help to contribute to the health care cost, so I think that might be part of that. Looking at what the future needs might be, ways to expand health care coverage—I’m not sure, Bob, what a single-payer system is.
Assemblywoman McClain:
It says different forms of single-payer systems implemented or contemplated about the state, such as employer mandate, player pay tax incentives, and state purchasing plans. It would be state health care as well as incentives for employers and stuff. The lack of long-term care beds for Alzheimer’s patients should be part of that too.
Assemblyman Conklin:
To my colleague Mr. Beers, I have to believe, given the makeup of the Senate, if what Mr. Beers says is true, this bill wouldn’t be here right now.
ASSEMBLYWOMAN MCCLAIN MOVED TO DO PASS S.B. 289.
ASSEMBLYMAN BEERS SECONDED THE MOTION.
THE MOTION CARRIED.
Chairwoman Giunchigliani:
S.C.R. 13, I already pointed out to you, with the letter, if the Committee was acceptable on that. S.C.R. 20, I think this was Senator Rhoads with the Utah line and the whole issue of Wendover. Do you wish to make a motion? I don’t think there were any amendments that were needed (Exhibit C).
Senate Concurrent Resolution 20 (1st Reprint): Directs Legislative Committee on Public Lands to conduct interim study of feasibility and desirability of changing state boundary line along border with Utah. (BDR R-786)
ASSEMBLYMAN GRADY MOVED TO DO PASS S.C.R. 20.
ASSEMBLYMAN CHRISTENSEN SECONDED THE MOTION.
THE MOTION CARRIED.
S.C.R. 26 is the next bill for our consideration (Exhibit C). This is Senator Coffin’s bill. This is supposed to tell us that sine die at midnight really means midnight.
Senate Concurrent Resolution 26 (1st Reprint): Amends Joint Rules of Senate and Assembly for 72nd Session of Legislature to clarify time by which Legislature must adjourn session sine die. (BDR R-1328)
ASSEMBLYWOMAN MCCLAIN MOVED TO DO PASS S.C.R. 26.
ASSEMBLYMAN MCCLEARY SECONDED THE MOTION.
THE MOTION CARRIED.
Lucille, we did consider your amendment, but we decided not to add it. Thanks for presenting it. No further business. Should I stand in recess and then we can just do behind the Bar from here on out, because we’ve pretty much taken our action? So we’ll stand in recess as a Committee and as we have any actions, we’ll come back.
[The meeting recessed at 5:32 p.m.]
RESPECTFULLY SUBMITTED:
Corey Fox
Transcribing Secretary
APPROVED BY:
Assemblywoman Chris Giunchigliani, Chairwoman
DATE: