MINUTES OF THE meeting
of the
ASSEMBLY Committee on Ways and Means
Seventy-Second Session
June 2, 2003
The Committee on Ways and Meanswas called to order at 4:32 p.m., on Monday, June 2, 2003. Chairman Morse Arberry Jr. presided in Room 3137 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.
COMMITTEE MEMBERS PRESENT:
Mr. Morse Arberry Jr., Chairman
Ms. Chris Giunchigliani, Vice Chairwoman
Mr. Walter Andonov
Mr. Bob Beers
Mrs. Vonne Chowning
Mrs. Dawn Gibbons
Mr. David Goldwater
Mr. Josh Griffin
Mr. Lynn Hettrick
Ms. Sheila Leslie
Mr. John Marvel
Ms. Kathy McClain
Mr. David Parks
Mr. Richard Perkins
STAFF MEMBERS PRESENT:
Mark Stevens, Assembly Fiscal Analyst
Steve Abba, Principal Deputy Fiscal Analyst
Ted Zuend, Deputy Fiscal Analyst
Susan Cherpeski, Committee Secretary
Carol Thomsen, Committee Secretary
Senate Concurrent Resolution 41: Provides items for consideration by Superintendent of Public Instruction in compiling biennial budgetary request. (BDR R-1374)
Randy Robison, Nevada Association of School Boards, presented S.C.R. 41 and explained that it was the final legislative iteration of the proposal more commonly known as iNVest. Since the resolution had been moved out of the Senate, there had been a request for one additional minor amendment (Exhibit C). He directed the Committee’s attention to page 2 of S.C.R. 41 and said the section that read “the Legislature recognizes . . . health benefits for employees and adequate compensation for teachers who provide instruction . . .” would be amended to read “the Legislature recognizes . . . health benefits for employees and adequate compensation for teachers and appropriate incentives for teachers who provide instruction in high impact and special needs areas.”
Mr. Robison claimed the amendment would clarify the intent of that section, and he hoped the Committee would consider the amendment. He offered to answer any questions and indicated that Dr. Dotty Merrill, Senior Director, Public Policy, Accountability, and Assessment, Washoe County School District, was present to answer questions as well.
Assemblywoman Giunchigliani thanked Mr. Robison and Dr. Merrill for the work they had done on the resolution and agreed that the amendment clarified the intent without committing the state to additional funding.
As there were no further questions or comments, Chairman Arberry declared the hearing on S.C.R. 41 closed. He informed the Committee that BDR 20-1376 would be discussed, although action would not be taken until the bill was ready.
Ms. Giunchigliani presented the BDR and explained that a bill had been proposed in the previous legislative session that would have utilized General Fund monies to build a performing arts center in Las Vegas and to support a culinary training academy. Time had run out before the bill could be processed so she had submitted the bill draft request again in the current session.
Ms. Giunchigliani explained that the performing arts center was a project sponsored by the Reynolds Association, and there was a fund of approximately $200 million for the construction of the center, but the association was seeking matching funds, although there was not a specific percentage required. In addition, the original request for the culinary training center had been $3 million, which had been reduced to $2 million. Due to the state’s financial situation, Ms. Giunchigliani had deemed it inappropriate to request General Fund monies to fund the projects; however, upon reading S.B. 497, she had realized there was another option for funding and assisting with the revitalization of downtown Las Vegas. It would not affect the taxpayer or the General Fund; it would merely enable local government to impose fees.
Ms. Giunchigliani noted that the Southern Nevada Regional Planning Commission had adopted a policy to recognize downtown Las Vegas as a vital center for the major governmental, financial, business, and cultural facilities of the entire region. The Commission was attempting to create incentives to encourage development in downtown Las Vegas, Henderson, Boulder City, North Las Vegas, and in other urban centers.
Ms. Giunchigliani said that with that goal in mind, she had approached Senator Raggio about amending S.B. 497 to include the performing arts center and culinary training center in Las Vegas. After speaking with Senator Raggio, she had decided to create a separate bill but had used much of the language from S.B. 497. She indicated there were some changes—instead of a percentage, she had placed a $3 million cap on the culinary training center, and she had created a funding split of one-third to the culinary training center and two-thirds to the stadium.
Ms. Giunchigliani added that she had received a telephone call from the owner of the Las Vegas 51s minor league baseball team indicating that the current sports facility was not adequate and the team would not stay in Las Vegas unless action was taken to improve the situation.
Ms. Giunchigliani opined that it was merely a policy decision, and she said she would be willing to work with the local governments in the Las Vegas area to ensure its success and to modify the plan if needed. She pointed out that revenue from the collection of the fees would not be available for use immediately, and the culinary center would be the only project started right away. She said she was willing to make changes, but she wanted additional input from the local governments.
Ms. Giunchigliani said she had used Sections 3, 4, and 5 from S.B. 497 with minor modifications, including referring to a professional sports facility rather than a stadium, and establishing a stadium authority that would consist of one member representing the Clark County Commissioners, two members representing the City of Las Vegas, and one member representing the stadium. She pointed out the Committee had copies of the BDR and would be receiving the official bill as soon as it was ready.
Assemblywoman Chowning commented that a regional commission should include members from all entities within the area, and she opined that the projects were needed and would greatly benefit the community.
Ms. Giunchigliani responded that the bill would not establish a regional commission; rather, it established a stadium authority and did not address regionalism at all. She said she had been willing to entertain the notion of adding representation, but she did not think that would create more support for the bill and seemed unnecessary.
Danny Thompson, Nevada State American Federation of Labor-Congress of Industrial Organizations (AFL-CIO), spoke in support of the bill and said that the culinary training institute had a long history of providing good jobs and benefits to the community.
Glen Arnodo, Political Director, Culinary Workers Union, addressed the Committee. He commented that many of the Committee members were familiar with the good work of the culinary training academy, which had trained thousands of applicants, in partnership with the gaming industry, and helped people get their first jobs in the industry. Many of the people helped by the culinary training academy were from the low-income strata and many would have been unable to get jobs in the industry without the academy. The academy had also helped hundreds of welfare-to-work participants to obtain gainful employment with benefits, such as health insurance and pensions. Mr. Arnodo pointed out that the academy was located in one of the toughest and most “gang-plagued” neighborhoods in North Las Vegas. He opined that the academy would be a boon to a neighborhood that was in need of help, and he appreciated the Committee’s consideration of the bill.
Ms. Giunchigliani remarked that she had information regarding the culinary institute if anyone wished to see it. She noted that the business community was involved in the project, which would aid in obtaining federal grants for the construction of the project.
Mr. Thompson added that he supported the culinary training center as well as the proposed revitalization of downtown Las Vegas as that was critical to the economy of the state. He opined that the City of Las Vegas should have the most members on the stadium commission, and he felt the commission would be more effective than a regional board.
Chris Knight, Director, Office of Administrative Services, City of Las Vegas, spoke in support of the bill and thanked Ms. Giunchigliani for her proposal. He said that many points had been made, including that the current baseball facility was located in the City of Las Vegas. Las Vegas had entered into an agreement to provide five acres for a performing arts facility, and the majority of the facilities mentioned in the bill were located within the City of Las Vegas. Mr. Knight agreed with Ms. Giunchigliani that revitalizing downtown Las Vegas would help the entire region and he envisioned that the stadium and the performing arts center would serve all citizens of southern Nevada. He added that the projects were important on a regional basis, but they were also important to the local economy of Las Vegas. Mr. Knight urged the Committee to support the bill.
Mr. Thompson interjected that he was concerned the bill would get “lost in the shuffle” as it had during the previous session, and he urged the Committee to pass the bill out of Committee as soon as possible.
Terri Barber, City of Henderson, spoke in opposition to the bill as she was concerned that it would be a countywide tax for a city project. She asserted that all jurisdictions within the county should have an equal opportunity to receive the benefits of such a tax. She said she supported the portion of the bill regarding the culinary institute, but she did not like the portion regarding the stadium, as Henderson had tried in the past to be considered as a site for a stadium. She noted that the composition of the board with two members from the City of Las Vegas would not allow the other jurisdictions an equal opportunity to participate in the funding. Ms. Barber commented that the Henderson City Manager had also spoken with the owner of the Las Vegas 51s, and the owner had indicated he would like to have the opportunity to consider other jurisdictions as well.
Ms. Giunchigliani asked Ms. Barber if she would support the bill if Henderson were added to the bill, and Ms. Barber responded affirmatively.
Assemblyman Parks asked if Ms. Barber was advocating a composition similar to the Regional Flood Control District or Regional Transportation Commission, where there were two members from the county, two members from the largest city, and one member from each of the other incorporated cities. Ms. Barber said she was not suggesting that a large, unwieldy board be created, but she felt representation was important so that each jurisdiction had an equal opportunity to have access to the money raised through a countywide tax.
Assemblyman Andonov questioned the current amount of taxes and fees assessed when renting a car. Mr. Parks explained that the current rental car tax structure included a 6 percent government services rate, a 3.5 percent recovery surcharge charged by the rental car companies, and cars rented at airports were also subject to airport taxes. There was approximately 1 percent of difference between the Reno and Las Vegas airports and those airport taxes ranged from 9 to 11 percent.
Speaker Perkins asked how those rates compared to other places. Mr. Parks said that when the rental car taxes had been changed two years before, Reno and Las Vegas had been near the bottom of the list in the top 100 cities. Across the country, rental car taxes had funded a large number of football and baseball stadiums and other convention authorities as well; rental car taxes had been a typical revenue source used for such purposes.
Kimberly McDonald, MPA, Special Projects Analyst and Lobbyist, City of North Las Vegas, voiced opposition to the BDR. She stated that since the culinary institute was in North Las Vegas she wanted the culinary institute to continue its work and she appreciated its contribution to the community. Although that was a portion of the bill, she was opposed to the bill as a whole due to the timing of the bill being presented so close to the end of session and the lack of equal representation in the bill.
Ms. McDonald said that as it was a regional project and a regional tax, all entities should be represented, particularly as each entity had a redevelopment agency that should share in some of those revenues. She said that representation was extremely important because it would be more equitable and would allow for more efficiency. She concluded by stating that as the community was growing, North Las Vegas needed a “seat at the table.”
Ms. Giunchigliani repeated her earlier question and asked Ms. McDonald if she would support the bill if North Las Vegas was included. Ms. McDonald indicated she would support the bill.
As there were no further questions or comments, Chairman Arberry closed the hearing on BDR 20-1376 and called a brief recess at 4:57 p.m.
The meeting was reconvened at 5:24 p.m. Mark Stevens, Assembly Fiscal Analyst, Fiscal Analysis Division, LCB, indicated that the Committee had received a handout (Exhibit D) outlining the proposed tax package and indicated that Ted Zuend, staff to the Assembly Committee on Taxation, would explain the handout.
Ted Zuend, Deputy Fiscal Analyst, Fiscal Analysis Division, LCB, presented the tax plan (Exhibit D).
Mr. Zuend indicated he was finished with his explanation of the tax package and offered to answer any questions.
Assemblyman Hettrick mentioned that he had received an e-mail from an individual in the Clark County Assessor’s Office stating that if there was an exemption on the real estate transfer tax of $200,000, which was one of the proposals, it would cost Clark County $50 million per year. Mr. Hettrick questioned how the exemption in the proposed package would affect the counties.
Mr. Zuend explained that the exemption would only apply to the state portion and would not cost the counties any revenue. There were provisions in the bill that would allow 0.2 percent commission for the counties with a population over 100,000 and a 1 percent commission for counties with a population under 100,000. That would give the counties approximately $200,000 per year. Also, counties with a population under 30,000 would be allowed to ask the Department of Taxation for assistance with audits and implementation of the tax. Counties over 30,000 would earn approximately $5,000 to $10,000 each year from the 1 percent commission, which would allow them to enhance their technology.
Mr. Hettrick asked if there was a fiscal note as to what it would cost the Department of Taxation to provide assistance to the counties. Mr. Zuend indicated that there was not an accurate fiscal note as that would require speculation regarding which counties might ask for assistance.
Mr. Hettrick asked if there were any taxes in addition to those listed on the handout (Exhibit D). Mr. Zuend said that all the taxes were included in Exhibit D, but the business license fee and the Secretary of State fees were in A.B. 536. He emphasized that all the taxes that had been presented were either in A.B. 536 or would be in the bill that would be drafted with the tax plan.
Mr. Hettrick asked when the Committee would receive the tax package in bill form as he wanted to be able to examine the bill in detail. Mr. Stevens interjected that staff was working on drafting the bill and the Committee would have it as soon as possible.
Assemblyman Griffin asked if there was anything else that would be added to the tax package. Mr. Zuend indicated that the entire tax package was contained within A.B. 536 and the bill that was being drafted, which would contain the items in Exhibit D.
Mr. Griffin questioned A.B. 536 and requested clarification of passive revenue generators. Mr. Zuend explained that the passive revenue generators provision was not in A.B. 536 but would be included in the main tax package bill. Mr. Griffin confirmed that the passive revenue generators would not change the aforementioned total revenue amount of $869.1 million over the biennium.
Assemblyman Beers asked if Schedule C businesses were exempt from the unified business tax (UBT) because under federal law, income from a Schedule C business was categorized as personal income and was subject to social security. Mr. Zuend replied that no businesses were exempt except those that were under the $450,000 threshold.
Mr. Beers commented that there was a provision in the Nevada State Constitution that did not allow taxation of personal income, and he asked how that would be addressed in terms of Schedule C businesses. Mr. Zuend said the bill was targeted at the reports the businesses would have to submit. Mr. Beers interjected that Schedule C businesses used the 1040 tax form. Mr. Zuend pointed out that Schedule C was also considered a business tax report. He conceded that he was not a legal expert on that matter. Mr. Beers said that the federal government considered Schedule C business income to be personal income, and the social security tax was imposed on the sum at the bottom of the Schedule C form, which meant it was not a deduction from the business income on a Schedule C. Mr. Zuend indicated Mr. Beers would need to read the bill in order to see if that issue was addressed.
Mr. Beers observed that Exhibit D did not include the $70 million one-time grant from the federal government that had been built into the future base budget. Mr. Stevens said that was correct, although the $67,952,000 projected to be received from the federal government for essential services, had been placed in the Distributive School Account to offset General Fund support. He noted that the grant could not be used as General Fund revenue but must be used for payment of essential services in state government; according to the language of the grant, the funds could be placed into funding for schools.
Mr. Beers said that the spending increase over the biennium was approximately $1.25 billion with the $869.1 million tax increase, the $327 million from existing tax revenue, and the $70 million federal grant.
Mr. Stevens said the $300 million that Mr. Beers had referred to was based on a lower base; it was not based on what the Economic Forum had projected. He pointed out that the appropriation level had stayed fairly equal to what the 2001 Legislature had appropriated. The revenues had decreased and the $300 million was based on that lower base of revenues; however, much of that was needed to reach the appropriation level approved by the 2001 Legislature. Mr. Stevens emphasized that the $300 million was not available for new expenditures. Mr. Beers protested and said the state had not spent to the appropriation level of the 2001 Legislature.
Mr. Stevens conceded that many of the one-shot appropriations were removed, but only $30 million had been removed from ongoing operating appropriations. The revenues had also decreased dramatically so a major portion of that $300 million was needed to reach the operating level approved by the 2001 Legislature. Mr. Beers contended that with the proposed tax package, the new federal funds, and the new funds projected by the Economic Forum, the total amount of spending for the next biennium would be $5 billion, and with the subtraction of the $3.75 billion spent in the previous biennium, the total amount of new spending would appear to be $1.25 billion for the next biennium. Mr. Stevens indicated that he would have to examine those figures to determine whether or not that assessment was accurate.
Assemblyman Andonov noted that the total revenue raised in the first year was considerably less than the amount in the second year as several implementation dates were delayed for several months. Given the implementation dates and the taxes outlined in Exhibit D, the package would raise $869 million, according to the information the Committee had received. Mr. Andonov pointed out that if the taxes were fully implemented from the first day of the next biennium, the two-year tax package would actually be in excess of $1 billion.
Mr. Stevens said that the information indicated that the tax package would generate $513.8 million the second year of the biennium once the taxes were fully implemented, and that would continue in each year of the biennium if the economy stayed healthy, which would make the total amount over $1 billion. Mr. Andonov reiterated that if the tax package were fully implemented it would be in excess of $1 billion in new revenue over the biennium, and Mr. Stevens agreed.
Assemblyman Goldwater responded to Mr. Beers’ earlier concerns regarding Schedule C business and said he had researched the Nevada State Constitution, which read, “no income tax shall be levied . . . taxes may be levied upon the income or revenue of any business in whatever form it may be conducted for profit in the state.” He said his understanding was that anyone filing Schedule C was at least attempting to run a business for profit.
Mr. Beers responded and said that was a quandary as the sentence before the section read by Mr. Goldwater said, “ . . . and no income tax shall be levied upon the wages or personal income of natural persons.” Mr. Beers said by definition a Schedule C business was personal income of a natural person, and he hoped that there was a deduction for the social security tax, particularly as a Schedule C business paid both halves of the social security tax at 13.5 percent.
Mr. Griffin questioned the business license tax, and Mr. Zuend explained that under the plan the tax would be scaled back to $50 by FY2006 and would remain at that level unless the 2005 Legislature chose to change it. He indicated that the full implementation of the universal business tax would replace the funds lost when the business license tax was reduced.
Assemblyman Marvel asked how much the passive revenue generators would produce. Mr. Zuend explained that passive revenue was defined as the revenue realized from reducing the allowances and those amounts were shown in Exhibit D. Mr. Marvel asked what the total amount would be, and Mr. Zuend indicated the amount was approximately $24 million the first year and $25 million the second year of the biennium.
Speaker Perkins commented that he had spent much time discussing the tax plan with the Senate majority leader, and those discussions had resulted in the tax plan presented to the Committee. In response to Mr. Griffin’s earlier question, Speaker Perkins indicated that the intention was to phase out the business license tax once the unified business tax was fully implemented.
Speaker Perkins expressed his appreciation for the hard work done by staff in formulating the tax plan. He reminded the Committee of the time constraints and advised that the Committee vote to accept the tax plan, and then once the bill was ready, it could be discussed and amended on the floor.
ASSEMBLYMAN PERKINS MOVED TO ACCEPT THE PLAN AND REVISIT THE PLAN IN A COMMITTEE MEETING ON THE FLOOR.
ASSEMBLYMAN GOLDWATER SECONDED THE MOTION.
Mr. Hettrick said the tax plan would raise over $1 billion once it was fully implemented and yet the Committee had not received the final bill and examined it in detail. He said he would like to see the bill before he voted as he did not think it appropriate to vote without all the information.
Mr. Griffin questioned the possibility of waiting until there was a bill and a hearing on the bill, and then taking action to move the bill to the Floor. He said he was in support of the tax package, but he would like to see a bill.
Speaker Perkins indicated he would be willing to modify his motion in recognition of the time constraints.
ASSEMBLYMAN PERKINS MOVED TO TAKE THE PLAN TO THE FLOOR WITHOUT RECOMMENDATION.
ASSEMBLYMAN GOLDWATER SECONDED THE MOTION.
Assemblywoman Gibbons asked what had happened to the bill that had been passed in concept several nights before. Speaker Perkins explained that the budget closed in the Senate and the budget closed in the Assembly had been different. Those differences had since been reconciled, and the budget was now $20 million less than the original budget, and the revenue had been modified to fit the budget.
Mrs. Gibbons said that as the budget was $20 million less the business license tax should be phased out. She added that she did not understand how the unified business tax would be collected. Chairman Arberry suggested that the Committee revisit that question once they had read the actual bill.
MOTION CARRIED WITH MR. ANDONOV, MR. BEERS, MRS. GIBBONS, MR. HETTRICK, AND MR. MARVEL VOTING NO.
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Mr. Stevens indicated that the Committee had previously received a schedule outlining the Distributive School Account (DSA) closing options reviewed by the committee chairmen and subcommittee chairmen. The options resulted in a net addition of $1 million in the first year and $28.8 million in the second year of the biennium and involved a number of items discussed previously. Mr. Stevens informed the Committee that the DSA funding bill would be an Assembly bill, and he said the Committee needed to make a recommendation in order to introduce the bill.
Mr. Marvel asked if the unclassified salaries would be included in the DSA bill. Mr. Stevens said the unclassified salaries would be in the pay bill, which would be addressed later in the meeting. He said the recommendation would strictly pertain to the Distributive School Account and would provide for a 2.75 percent salary increase in the first year of the biennium and a 2 percent salary increase in the second year for all K-12 employees. Mr. Marvel clarified that state employees would not be included. Mr. Stevens explained that the state employees’ salaries would be in a separate bill that would be addressed later.
ASSEMBLYWOMAN CHOWNING MOVED TO APPROVE THE RECOMMENDATION AS OUTLINED BY MR. STEVENS.
ASSEMBLYWOMAN LESLIE SECONDED THE MOTION.
Mrs. Gibbons interjected that she would vote yes on the current motion, but she indicated that she might change her vote upon seeing the final bill. Mr. Marvel agreed and said he would vote no as he had not yet seen the tax bill that would fund the DSA.
MOTION CARRIED WITH MR. ANDONOV, MR. BEERS, MR. HETTRICK, AND MR. MARVEL VOTING NO.
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Mr. Stevens directed the Committee’s attention to BDR S-1381, which was the pay bill and included the classified and unclassified salaries as well as a recommendation for a 2 percent salary increase for state classified and University and Community College System of Nevada (UCCSN) personnel in the second year of the biennium. The first portion of the bill listed all the unclassified salaries in state government. The recommendations included in the bill would increase the salaries of a number of unclassified positions.
Mr. Stevens indicated that the classified portion of the bill began on page 22. The credential pay plan monies had been removed from the Gaming Control Board budget, and Section 5 would place those funds back in the budget so payments could be continued. Section 7 provided a 2 percent salary increase in the second year of the biennium for the classified medical positions included within state government. In addition, there was a 2 percent salary increase for all state positions, classified and unclassified, in the second year of the biennium.
Mr. Stevens said he had made a commitment to the Budget Division that he would explain the funding for state unclassified and classified employees, which was contained in Sections 4 and 6 of the bill. He explained that when there was a salary increase, the funds were pooled and provided to the State Board of Examiners. State agencies then applied to the Board on a need basis and the salary savings that were generated offset the amount of new salary money that was required to be provided by the Board. Mr. Stevens indicated that the account had been over-appropriated every session and reversions had been made in that particular account, including large reversions made in the current biennium. Therefore, the amount of money provided for the 2 percent salary increase was somewhat less than in the past in an attempt to avoid over-appropriating funds and reverting them later.
Mr. Stevens stated that he did not feel there was a risk of having insufficient funds and having to add money to the account at a later time, but he wanted to inform the Committee of the situation in the event that adjustments needed to be made.
ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO INTRODUCE BDR S-1381.
ASSEMBLYWOMAN LESLIE SECONDED THE MOTION.
Mrs. Chowning asked if the salaries contained within the bill were consistent with decisions made by the joint subcommittees. Mr. Stevens indicated that it was possible there were differences and explained that any recommendations that came from the Governor or requests that were made by agencies were reviewed. Many of the salaries were not approved, but all were reviewed.
Mrs. Chowning pointed out that some requests were not reviewed by the Governor, and she asked if those were consistent with the information given to the joint subcommittees. Ms. Giunchigliani responded to Mrs. Chowning and said unclassified salaries were reviewed based upon a recommendation from the Governor, and then the chairmen of the respective subcommittees reviewed those changes and agreed or disagreed. Ms. Giunchigliani added that the classified positions had received a 2 percent salary increase in the second year of the biennium, but not every salary had been reviewed.
Mr. Andonov questioned the fiscal impact of the increase. Mr. Stevens approximated the impact would be less than $100,000 in General Fund monies for the unclassified salaries. The 2 percent salary increase for classified positions would cost approximately $14 million in the second year of the biennium.
Mr. Beers asked if the 2 percent was in addition to the 2.5 percent built into the base for the University System. Mr. Stevens said there had not been a cost-of-living increase built into the University System’s budget in either year of the biennium. He noted that there were “merit dollars” built into the base during the upcoming biennium, but the Governor had not recommended a cost-of-living increase. The bill, if it passed, would provide a 2 percent cost-of-living increase to university personnel, both professional and classified, in the second year of the biennium.
Mr. Beers asked if there was a 2.5 percent increase in the base for the University System. Mr. Stevens repeated that there were “merit dollars” that were included in the University System’s budget. Those were provided for the professional positions for only 6 months in the first year of the biennium and 12 months the second year of the biennium. He repeated that there had not been a cost-of-living increase in the budget.
Mr. Griffin said he would be abstaining from the vote as the State Fire Marshal was his father-in-law, and his salary was listed in the bill. He declared that he supported the budget, but he would abstain until he could consult with the Legal Division.
Mr. Andonov asked if the 2 percent increase would apply to the vacant positions as well. Mr. Stevens explained that he had reviewed what had been provided for a 1 percent increase in the previous session and then doubled that amount. That money was pooled and provided to the State Board of Examiners and then state agencies applied for funds once the payroll costs had been determined. Mr. Stevens pointed out that any salary savings generated would reduce the amount of money provided to agencies from the pool.
Mr. Andonov requested further clarification and asked if the salary savings were placed into the pool controlled by the Board of Examiners. Mr. Stevens explained that the aforementioned $14 million would be placed into the pool. If an agency had vacancy savings then they would receive less money from the salary adjustment pool.
Chairman Arberry indicated the Committee would vote on the motion.
MOTION CARRIED WITH MR. ANDONOV, MR. BEERS, AND MR. HETTRICK VOTING NO AND MR. GRIFFIN ABSTAINING.
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Mrs. Chowning thanked the staff for providing additional information that had indicated the salaries included in the bill were consistent with the subcommittees’ recommendations.
Assembly Bill 466: Makes appropriation for special assessment on state-owned property assessed for improvements relating to flood protection project. (BDR S-1253)
Mr. Stevens explained that A.B. 466 provided an appropriation of $246,625 for an assessment against state property that was located within a flood protection district. The Division of State Lands had presented several options to the Committee, and Mr. Stevens indicated there was a proposed amendment to the bill that would provide an appropriation of $116,641, which was the amount due June 30, 2003. The property would be offered for sale, and if sold, the remaining balance of the obligation would be paid in escrow. If it was not sold, there would be a $33,000 obligation due in 2004. Mr. Stevens repeated that the amendments would provide an appropriation of $116,641 to pay the state’s obligation.
ASSEMBLYWOMAN CHOWNING MOVED TO AMEND AND DO PASS A.B. 466.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED UNANIMOUSLY.
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Assembly Bill 474: Revises provisions governing payment of expenses of Commission for the Preservation of Wild Horses from money in Heil Trust Fund for Wild Horses. (BDR 45-1261)
Mr. Stevens said that A.B. 474 would allow the Commission for the Preservation of Wild Horses to expend money within the principal of the bequest that was provided by Mr. Heil. Currently, the law allowed the Commission to use only the interest generated from the principal amount; however, by the end of the biennium, the Commission would have an insufficient amount of interest. A.B. 474 would allow the Commission to expend principal as well as the interest generated from the principal.
Mr. Marvel said that there had recently been an Attorney General’s assessment of approximately $18,000 against the Commission. He opined that in order to save the Commission, A.B. 474 had to be passed. Mr. Marvel added that Freeman Johnson, Assistant Director, State Department of Conservation and Natural Resources, was present in the audience and could address the Committee’s concerns if needed.
Ms. Giunchigliani said she supported the Commission, but she felt that A.B. 474 violated the bequest of the individual who had established the Heil Trust Fund for Wild Horses.
Mr. Freeman said the original bequest by Leo Heil was approximately $375,000. Over the course of 30 years that amount grew to approximately $1.3 million, and at some point the Legislature had placed a threshold of $900,000 upon the fund. The Commission could not spend below that amount without legislative consent. Mr. Freeman indicated that the current balance of the Heil Fund was approximately $700,000. He stated that if the bill was not passed, then it would be a matter of saying that the “operation was a success, but the patient died” because there would be no Commission to implement the wishes of Leo Heil.
Mr. Beers disagreed with Mr. Freeman and said if the bill was processed, the Legislature would be ensuring that the Commission would be gone within four years. He opined that it would be better to cut expenses and allow the fund to increase so the investment income would be able to fund ongoing operations.
Mr. Freeman contended that the Commission had been utilizing the interest income, but as interest rates were going down, the Commission was forced to function with a much smaller operating income. To prohibit the Commission from paying its expenses as it administered the program would defeat the purpose of the trust, which was to care for wild horses. He repeated his earlier comment regarding a successful operation and said if the bill was not passed, there would be money, but no Commission to administer the program.
Chairman Arberry reminded the Committee that there was not much time for discussion. He indicated he would take a motion.
ASSEMBLYMAN MARVEL MOVED TO DO PASS A.B. 474.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED WITH MR. ANDONOV, MR. BEERS, MRS. GIBBONS, MS. GIUNCHIGLIANI, AND MS. LESLIE VOTING NO.
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Senate Bill 3 (1st Reprint): Makes various changes to off-track pari-mutuel wagering. (BDR 41-41)
Mr. Stevens indicated that there was an amendment to page 2 in Section 1 on line 26, which would insert “whose population is less than 100,000” after the word “state.” He said the intent of the amendment was to have the bill apply to the rural areas of the state.
ASSEMBLYMAN MARVEL MOVED TO AMEND AND DO PASS S.B. 3.
ASSEMBLYWOMAN LESLIE SECONDED THE MOTION.
MOTION CARRIED UNANIMOUSLY.
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Senate Bill 184 (2nd Reprint): Revises certain provisions governing occupational diseases contracted by certain local police officers. (BDR 53-851)
ASSEMBLYMAN MARVEL MOVED TO DO PASS S.B. 184.
ASSEMBLYMAN GOLDWATER SECONDED THE MOTION.
MOTION CARRIED. (Mr. Perkins was not present for the vote.)
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Senate Bill 306 (2nd Reprint): Revises provisions governing educational benefits provided to members of Nevada National Guard. (BDR 36-991)
Mr. Stevens explained that the bill would allow the Board of Regents to grant a waiver of registration or laboratory fees for members of the Nevada National Guard. He noted that there was a program that provided for 50 percent of costs, but S.B. 306 would allow the Board to waive the entire cost.
Ms. Giunchigliani suggested that, as the fiscal impact was unknown, the bill be amended to include a two-year sunset provision at which time the fiscal impact could be evaluated.
ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO AMEND AND DO PASS S.B. 306.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED. (Mr. Perkins was not present for the vote.)
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Senate Bill 506: Authorizes sale of National Guard Armory located in Carson City under certain circumstances. (BDR S-1373)
Mr. Stevens explained that S.B. 506 would allow the proceeds of the sale of a National Guard Armory to be deposited in the contingency fund and used to pay for construction costs related to the State Emergency Operations Center. He indicated that subsection 4 included language regarding a settlement that would be received involving the Securities and Exchange Commission. Those funds could potentially be utilized to fund construction of that new facility as well.
ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO DO PASS S.B. 506.
ASSEMBLYWOMAN LESLIE SECONDED THE MOTION.
MOTION CARRIED UNANIMOUSLY.
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Senate Concurrent Resolution 41: Provides items for consideration by Superintendent of Public Instruction in compiling biennial budgetary request. (BDR R-1374)
Ms. Giunchigliani indicated that, as there was not much time to process the bill, she would suggest passing it out of the Committee without amendment and then making a Floor statement regarding the intent.
ASSEMBLYWOMAN GIUNCHIGLIANI MOVED TO DO PASS S.C.R. 41.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED UNANIMOUSLY.
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ASSEMBLYWOMAN GIUNCHIGLIANI MOVED FOR COMMITTEE INTRODUCTION OF BDR 20-1376 WITH THE ADDITION OF THE CITY OF HENDERSON AND THE CITY OF NORTH LAS VEGAS TO SECTION 5 AND A SUNSET IN TWO YEARS FOR THAT SECTION.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED WITH MR. HETTRICK VOTING NO.
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Assembly Bill 553: Makes various changes regarding state financial administration and makes appropriations for support of civil government of State. (BDR S-1371)
Mr. Stevens explained that A.B. 553 was the General Appropriations Act and included all appropriations for state agencies. The Act, combined with the Distributive School Account and Class-Size Reduction bills and the Authorizations Act, provided for the general operations of state government and funding for school districts.
ASSEMBLYMAN PERKINS MOVED TO DO PASS A.B. 553.
ASSEMBLYWOMAN McCLAIN SECONDED THE MOTION.
Mr. Griffin said he would abstain from voting and would be speaking to the Legal Division to determine whether or not he would be able to vote on the Floor as his father-in-law’s salary was listed in the bill.
MOTION CARRIED WITH MR. ANDONOV, MR. BEERS, MRS. GIBBONS, MR. HETTRICK, AND MR. MARVEL VOTING NO AND MR. GRIFFIN ABSTAINING.
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Assembly Bill 366 (1st Reprint): Provides exemption from governmental services tax for vehicles registered by resident of Nevada who is on active duty in Armed Forces of United States. (BDR 32-347)
Mrs. Chowning claimed that A.B. 366 would generate revenue for the state. She said there were approximately 30 enlisted persons who would maintain the registration of their vehicles in Nevada, which would generate approximately $330 per year. She opined that it was an important time to pass the bill and demonstrate support for the military.
ASSEMBLYWOMAN CHOWNING MOVED TO DO PASS A.B. 366 AS AMENDED.
ASSEMBLYMAN PARKS SECONDED THE MOTION.
MOTION CARRIED UNANIMOUSLY.
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The meeting was recessed at 6:27 p.m., and due to time constraints, was not reconvened.
RESPECTFULLY SUBMITTED:
Susan Cherpeski
Committee Secretary
APPROVED BY:
Assemblyman Morse Arberry Jr., Chairman
DATE: