MINUTES OF THE
SENATE Committee on Finance
Seventy-second Session
May 26, 2003
The Senate Committee on Finance was called to order by Chairman William J. Raggio, at 9:20 a.m. on Monday, May 26, 2003, in Room 2134 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Attendance Roster. All exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.
COMMITTEE MEMBERS PRESENT:
Senator William J. Raggio, Chairman
Senator Raymond D. Rawson, Vice Chairman
Senator Dean A. Rhoads
Senator Sandra J. Tiffany
Senator Barbara K. Cegavske
Senator Bob Coffin
Senator Bernice Mathews
GUEST LEGISLATORS PRESENT:
Assemblywoman Barbara E. Buckley, Clark County Assembly District No. 8
Senator Dennis Nolan, Clark County Senatorial District No. 9
STAFF MEMBERS PRESENT:
Gary L. Ghiggeri, Senate Fiscal Analyst
Bob Guernsey, Principal Deputy Fiscal Analyst
Lorne J. Malkiewich, Director, Director’s Office, Administrative Division, Legislative Counsel Bureau
Susan E. Scholley, Senior Research Analyst, Research Division, Legislative Counsel Bureau
Julie Walker, Committee Secretary
OTHERS PRESENT:
Keith L. Lee, Lobbyist, Responsible Mortgage Lenders Coalition
Kenneth T. Scruggs, Lobbyist, Household Financial Group
Mendy K. Elliott, Lobbyist, Wells Fargo Bank
David K. Neidert, Deputy Attorney General, Criminal Justice Division, Office of the Attorney General, State of Nevada
Ron Titus, Court Administrator and Director of the Administrative Office of the Courts, Office of Court Administrator, Supreme Court
The Honorable Peter I. Breen, Second Judicial District, District Courts of Nevada
Carol Aiello-Sala, Administrator, Aging Services Division, Department of Human Resources
Carla Watson, Administrative Services Officer, Aging Services Division, Department of Human Resources
Renee Parker, Chief Deputy Secretary of State, Office of the Secretary of State
Robert Wideman, Deputy Chief, Nevada Highway Patrol, Department of Public Safety
We have several bills upon which we must make a determination to concur or not concur with the Assembly actions.
SENATE BILL 34 (2nd Reprint): Clarifies that pupil may be retained more than once in same grade under certain circumstances. (BDR 34-639)
In Amendment No. 748 to Senate Bill (S.B.) 34), the Assembly amended out all of Section 1 that dealt with pupils being allowed to be tested for early admittance to kindergarten, if they were less than 5 years old but at least 4.5 years old by September 30. In Section 1, language was added to change the first sentence on lines 11 and 12 to read, “Except as otherwise provided in subsection 2 of Nevada Revised Statutes (NRS) 392.033 for the promotion of a pupil to high school, no pupil may be retained more than one time in the same grade.” I would suggest we not concur with the Assembly’s amendment.
SENATOR CEGAVSKE MOVED TO NOT CONCUR WITH THE ASSEMBLY AMENDMENT NO. 748 TO S.B. 34.
SENATOR RAWSON SECONDED THE MOTION.
THE MOTION PASSED. (SENATOR TIFFANY WAS ABSENT FOR THE VOTE.)
*****
SENATE BILL 439 (1st Reprint): Makes various changes concerning Public Employees’ Retirement System and Judicial Retirement System. (BDR 23‑563)
Senator Raggio:
The Assembly utilized Amendment No. 781, which would allow judges to change from the existing retirement system to the Public Employees Retirement System without sitting for reelection. It would apply to existing judges, and if they were sitting in that position on November 5, 2002, they would be eligible for the option of change.
SENATOR RAWSON MOVED TO CONCUR WITH THE ASSEMBLY’S ADOPTION OF AMENDMENT NO. 781 TO S.B. 439.
SENATOR RHOADS SECONDED THE MOTION.
THE MOTION PASSED. (SENATOR TIFFANY WAS ABSENT FOR THE VOTE.)
*****
SENATE BILL 407 (2nd Reprint): Makes supplemental appropriation to Western Interstate Commission for Higher Education for unanticipated shortfall in money for Fiscal Year 2002-2003 resulting from reclassification of position. (BDR S-1225)
Senator Raggio:
Senate Bill 407 was an appropriation to Western Interstate Commission for Higher Education (WICHE), and apparently, on the Assembly side, the amount was changed from $3400 to $2600 in Amendment No. 750 to S.B. 407.
SENATOR RAWSON MOVED TO CONCUR IN THE ACTION OF THE ASSEMBLY AMENDMENT NO. 750 TO S.B. 407.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION PASSED. (SENATOR TIFFANY WAS ABSENT FOR THE VOTE.)
*****
Senator Raggio:
Bill Draft Request (BDR) S-1364 was requested by the committee and would appropriate to the Interim Finance Committee (IFC), for a potential allocation to the Department of Public Safety, the amounts necessary to convert the radio system costs, consisting of $14.6 million from the State Highway Fund and $1.8 million from the State General Fund.
Bill Draft Request (BDR) S-1364: Makes appropriation to Interim Finance Committee for allocation to Department of Public safety for radio system costs, infrastructure upgrades and user equipment (Later introduced as S.B. 499)
Under the bill, the State Board of Examiners shall consider the request and determine whether an allocation should be made, and then make that recommendation to the IFC. After its own independent determination, the IFC would have to approve any recommendation. That gives IFC the opportunity to examine the requests as they come forward.
Gary L. Ghiggeri, Senate Fiscal Analyst, Fiscal Analysis Division:
This legislation should be effective July 1, 2003, and that is not included in the bill draft. You will need to make a change. Otherwise, the bill is the same as requested.
SENATOR RAWSON MOVED TO INTRODUCE THE AMENDED VERSION OF BDR S-1364 AS A SENATE FINANCE COMMITTEE BILL.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
*****
Senator Raggio:
We will now hear testimony on Assembly Bill (A.B.) 284.
ASSEMBLY BILL 284 (2nd Reprint): Prohibits unfair lending practices for home loans and revises provisions governing sale of real property by trustee. (BDR 52-20)
Assemblywoman Barbara E. Buckley, Clark County Assembly District No. 8:
This bill introduces the topic of predatory lending by addressing the most offensive practices involved. It pertains only to high-cost loans defined in the federal law, the Home Owners Protection Act (HOPA), as loans with rates exceeding 8 points over the Treasury Bill rate (T-bill), or when lender fees exceed 8 percent of the loan.
It prohibits the worst practices of predatory lending. First, it prohibits asset‑based lending. An example would be lending money to a borrower based solely on the equity of his home, with complete disregard for his ability to repay the loan. Senior citizens are most susceptible to this practice because they are asset-rich but income-poor. They are prime targets for predatory lenders. The other predatory practice that A.B. 284 seeks to prohibit is “flipping.”“Flipping” occurs when a lender persuades a borrower to refinance with a new larger loan, designed to pay off the previous loan and then to finance the fees and costs of the new loan. As the new loan is extended over a longer period of time, a borrower is exposed to a greater risk of losing his or her home. Assembly Bill 284 prohibits the financing of pre-payment fees or penalties. A.B 284 also prohibits selling unnecessary cost-prohibitive insurance coverage such as the single-premium credit insurance. This is called “packing.” Such coverage is very profitable for lenders who retain 40 percent to 70 percent of the premiums. It costs consumers four to five times as much as monthly-paid credit insurance and over ten times as much as term life insurance policies. Though the coverage lasts for 5 years, borrowers pay for it over 30 years or the term of the loan.
Many times homes are sold not through judicial foreclosure, but through a deed of trust sale, so the court never has an opportunity to review the case in which a home is taken away from a borrower. This bill has received unanimous support of lenders.
Senator Raggio:
How will the lender determine, under Section 7, that the borrower has the ability to repay the loan? We do not want to turn this into a situation where people are unable to get a loan. What is required, as a practical matter?
Assemblywoman Buckley:
It would be taken care of under the underwriting process of every lender. Typically that is done now with debt-to-income ratios and review of the credit report. As a practical matter, the cases are clear.
Senator Raggio:
Is the fiscal note still valid?
Assemblywoman Buckley:
There is no money for new positions, which might be desirable, but that is not necessary to implement this bill. Government resources are limited and that is why the most important parts of the bill are the civil remedies. In Section 8, paragraph 2, if lenders engage in unfair lending practices, they are liable for damages. In paragraph 3, borrowers have a defense against losing their home and being foreclosed upon. These are the remedies we see as being helpful. In Section 9 the lenders did not want to deal with the predatory lending ordinance in every city in the state.
Senator Raggio:
How many states have these laws?
Assemblywoman Buckley:
These laws are found in 23 states plus the District of Columbia.
Keith L. Lee, Lobbyist, Responsible Mortgage Lenders Coalition, Nevada Finance Association:
We wholeheartedly support this bill. We think the fiscal note is unnecessary. The key is the civil action the borrower can pursue against predatory lenders to recover damages.
Kenneth T. Scruggs, Lobbyist, Household Financial Group:
I am in support of the bill. We think this bill offers significant protections for consumers.
Mendy K. Elliott, Lobbyist, Wells Fargo Bank:
We wholeheartedly support this bill. We want this bill because it will protect the consumers.
Senator Raggio:
Who will address the fiscal note?
David K. Neidert, Deputy Attorney General, Criminal Justice Division, Office of the Attorney General:
The chief of the criminal division called me at 5:30 p.m. on Friday afternoon before a 3-day weekend to ask me to address the fiscal note today. To be candid, this was something I had not looked at prior to being asked to represent the attorney general’s office today. I think Assemblywoman Buckley is correct by saying that the biggest cost is the criminal enforcement mechanism within the bill. That would create, as the fiscal note indicated, a deputy attorney general position, an investigator position, an auditor position and a legal secretary position. We currently do not have those positions in place to implement the criminal enforcement provisions of this bill. There was a suggestion with respect to how the fiscal note could be eliminated, and that would be for A.B. 284 to be amended to provide that the attorney general’s office is entitled to recover the cost of investigation and prosecution to increase the cap under NRS 598.260 to $500,000 and allow a portion of those funds to be used to offset related costs.
Senator Raggio:
You have referred to a statute. What are you talking about?
Mr. Neidert:
I will be honest. I do not know.
Senator Raggio:
We need a specific position on this or alternatives before we can process this bill. We will be meeting again here either this morning or later today. The policy of this committee is not to ignore fiscal notes. If there is a fiscal note, we need to know what it is. If there is some way to alleviate it or reduce it, come back as soon as you can today with that information.
This gives the attorney general the primary jurisdiction to investigate and prosecute. Would that preclude local district attorneys from prosecuting?
Mr. Neidert:
I do not believe it would, although when the word “primary” is in statutes such as this, typically the district attorneys would defer to the attorney general.
Senator Raggio:
I think this is a very important bill. I am concerned about predatory lending. Resorting to a civil penalty is not the best way to handle this, particularly if someone is a persistent predatory lender. If you can assist us, please come back with that information.
We will close the hearing on A.B. 284.
ASSEMBLY BILL 29 (2nd Reprint): Makes various changes concerning administrative assessments and forfeiture of bail. (BDR 14-130)
Senator Raggio:
In joint closings, we agreed to add $2 to the requested $5 as an administrative assessment. That takes care of any shortfall in funding.
Ron Titus, Court Administrator and Director of the Administrative Office of the Courts, Office of Court Administrator, Supreme Court:
Assembly Bill 29 increases the administrative assessments by a total of $17. That is $7 for specialty courts and $10 for general administrative assessments. Section 1 of the bill provides for the specialty court assessment. It is currently $5 for all misdemeanor violations.
Senator Raggio:
Are you aware of the action taken by the joint subcommittee?
Mr. Titus:
Yes, I am.
Senator Raggio:
Does the court have any objection to that?
Mr. Titus:
There are no objections.
Senator Raggio:
That will fund the requested expansion of the rural drug court program. What else is in the bill?
Mr. Titus:
The $5 administrative assessment fee would be amended to a $7 administrative assessment fee. There is a $10 regular administrative assessment divided 51 percent for the court and 49 percent for General Fund. The percentage for the court is divided into 18.5 percent for the administration of the court, 9 percent for the uniform system for judicial records, 9 percent for judicial education, and 60 percent goes to the Nevada Supreme Court.
Senator Raggio:
Is this the way the way the budgets were constructed?
Mr. Ghiggeri:
Yes.
The Honorable Peter I. Breen, Second Judicial District, District Courts of Nevada:
We are here in support and will answer any questions you may have.
Senator Cegavske:
I would like to disclose that I am an employee of WestCare and would receive no benefit from the passage of the amendment changing the administrative assessment fee from $5 to $7.
SENATOR MATHEWS MOVED TO AMEND AND DO PASS A.B. 29 TO BE CONSISTENT WITH THE ACTION TAKEN IN THE JOINT CLOSING.
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION PASSED.
*****
ASSEMBLY BILL 515 (2nd Reprint): Makes various changes to provisions governing property tax assistance for senior citizens. (BDR 38-499)
Carol Aiello-Sala, Administrator, Aging Services Division, Department of Human Resources:
We are here to support A.B. 515. It will simplify the existing income range schedule used for the senior citizen’s property tax assistance program and provide a 100 percent rebate for taxes paid up to the $500 cap to those eligible claimants whose income is at or below the federal poverty level for family units of one or two. Other provisions of this bill would expand existing or impose new eligibility limitations (Exhibit C).
Carla Watson, Administrative Services Officer, Aging Services Division, Department of Human Resources:
There are ten provisions of this bill; all are listed in order of discussion in my handout (Exhibit D). In provision 1, simplification of the schedule would prevent minor income differences from causing significant differences in rebates. The structure of the schedule would change from the existing five set points to a graduated or sliding scale. The graduated ranges would fall between 100 percent and 10 percent as opposed to the existing five set points of 90, 80, 50, 25, and 10 percent. This would result in some eligible claimants receiving a larger rebate while others would receive a smaller rebate.
Senator Raggio:
Who would receive the smaller rebates?
Ms. Watson:
Those in the higher income ranges would receive smaller rebates. Part of the proposal in extending it to 100 percent is to hold harmless those at or below the federal poverty level. That group would receive 100 percent up to the $500 cap as opposed to 90 percent.
The graduated ranges are structured to provide 100 percent rebates of taxes paid, up to the $500 cap, to those eligible claimants whose income is at or below the federal poverty levels for family units of one, for single claimants, or two if spouses file jointly. Exhibit D contains multiple schedules pertaining to the proposed changes. The first schedule is on page 2. It identifies the existing schedule.
Senator Raggio:
If you have a present income range between $20,000 and $23,500, do you get a 10 percent refund?
Ms. Watson:
You would receive 10 percent of the property taxes paid up to the $500 cap.
Senator Raggio:
What would the proposal do with that group?
Ms. Watson:
The proposal would range from 14.487 percent to 10 percent.
Senator Raggio:
How does this simplify the schedule? Will people easily know what their eligibility is?
Ms. Watson:
It would simplify it because now a claimant could have $1 difference in income and that would equate to a significant rebate, if they fall into a different category.
Senator Raggio:
If someone has an $18,500 income, they now get 50 percent of their taxes back. Under your proposal, are they only going to get 34 percent back?
Ms. Watson:
That is correct.
Senator Raggio:
Is that mainly to allow you to give 100 percent to those who are under the federal poverty level?
Ms. Watson:
That was the initial premise, yes. When seniors receive a significant difference from one year to another, they will call and inquire what occurred and then an audit must be done on that application and the prior application to determine why there was such a significant difference.
The second schedule is on page 3; it identifies the fiscal impact of the proposed changes that would not be implemented until FY 2005. The schedule on page 4 provides a comparison of case scenarios of clients who received rebates in FY 2002 and FY 2003 and the impact on rebate amounts. The schedule on page 5 provides the global impact of the new schedule when compared to the existing schedule for clients who received rebates in FY 2002 and FY 2003. What we show on page 5 is that the total number of rebates that increased by more than $100 is only .47 percent of the total. We tried to construct the range so everyone would stay fairly equal.
The second provision would hold harmless those eligible claimants whose income is at or below the federal poverty level for family units of one if filing single, or two if filing jointly, if there are insufficient funds available to provide 100 percent of calculated rebates to all eligible claimants. Remaining rebates would be reduced by the percentage necessary to remain within the legislatively approved budget. Currently, if a supplemental appropriation is needed to provide rebates to all eligible claimants, and the IFC does not approve a supplemental appropriation, all rebates are reduced by the percentage necessary to remain within the legislatively approved budget, holding harmless those eligible claimants whose income is at or below the federal poverty level for those most in need. If this provision is accepted, we would recommend that language be included to allow for refunds to be processed for those claimants whose income falls at or below the federal poverty level prior to the IFC meeting date.
Senator Raggio:
Are you suggesting a further amendment?
Ms. Watson:
No. It is in the current version.
The third provision found in Section 5, page 4 of the bill would limit the assessed value of the applicant’s principal residence to $87,500. Currently, there is no limitation on the assessed value of the applicant’s principal residence. Provision 4 would limit the value of the applicant’s liquid assets to $150,000. Currently, there is no limitation on the value of the applicant’s liquid assets.
Senator Raggio:
That would be new, but are you still retaining the first part for property other than the home that cannot exceed $30,000? Does that stay in?
Ms. Watson:
That amount stays the same, but there is also a proposal in this bill that would limit a claimant from owning real property in other states. Currently there is no limitation on the assessed value of the applicant’s principal residence. If the assessed value is 35 percent of the cash value, a home assessed at $87,500 would have a cash value of approximately $250,000. By limiting the assessed value of the applicant’s principle residence to $87,500, certain claimants, who would otherwise be eligible, will no longer be eligible to receive a rebate. The estimated fiscal impact is a reduction of $12,200 in rebates in FY 2005 as shown on page 6. Provision 5 of the bill would disallow claims for applicants who own real property in other states that exceed the assessed limitations in Nevada. Currently, property other than the home may not have an assessed value of more than $30,000 in this state; however, applicants may own real property in other states that exceeds the assessed limitation in Nevada. As the case with liquid assets, we were unable to estimate the fiscal impact for this provision, as this information is not required to be provided by applicants.
Senator Raggio:
Are liquid assets more than $150,000?
Ms. Watson:
Currently there is no limitation on an applicant’s liquid assets.
Senator Raggio:
Applicants would be denied if they owned any real property other than their residence of over $30,000. That would bar them. If their home exceeded an assessed value of $87,500 or one-third of actual value in our state, they would be barred; they would also be barred if they had any liquid assets otherwise of more than $150,000.
Ms. Watson:
That is correct. Going on, provision 6 pertains to the consumer price index (CPI). The CPI is applied to the maximum income each year to establish the new maximum income level. Provision 6, which is Section 1 of the bill, would change the CPI adjustment month from December to November. The CPI figures for December are not available before January 16. Currently, there is insufficient time to print new applications and instructions reflecting the new income maximums.
Provision 7, in Section 3, would extend the filing period from April 15 until April 30. Many claimants wait until the April 15 deadline to file their federal income tax returns, and the division has received complaints indicating there is not ample time to get copies of tax returns to submit with the application to meet the April 15 deadline.
Provision 8 adds cleanup language to reference an exception that allows the administrator to extend the time to file a claim in the event of a hardship.
Provision 9 adds language to allow the administrator to appoint a designee to administer the claimant grievance process.
Provision 10 adds language to allow the administrator to appoint a designee to certify claims against the Senior Citizens’ Property Tax Assistance Account.
Senator Mathews:
Would you explain again about the complaints you said you received from people because the amounts changed from year to year.?
Ms. Watson:
It is more difficult for us to administer because when claimants receive a significance difference in the rebate from one year to the next, they want to find out the reason for the difference. The office manager will have to audit the existing application and the one from the prior year to determine what happened to create the difference.
Senator Mathews:
Will this bill end the audit process?
Ms. Watson:
We believe this will decrease it significantly because the rebates from year to year will not change significantly if the income does not change.
Senator Mathews:
My concern is that claimants would be lost. Will you be losing 30 of them?
Ms. Watson:
We are not losing claimants based on changing the schedule. Some claimants will not be eligible under the new limitations.
Senator Raggio:
We will close the hearing on A.B. 515.
SENATE BILL 498: Requires reversion to State General Fund of certain money in Revolving Account for Investigation, Enforcement and Education. (BDR 7‑1358)
Senator Raggio:
This is a bill we requested. There is a settlement we will call the “Wall Street Settlement” (WSS) due to the activities of brokers and traders. Based on population, the total WSS coming to the State of Nevada will be approximately $3,875,000. The Office of the Secretary of State will receive the monies under NRS 90.851, the revolving account for investigation, enforcement and education, a special account where the money would go. This bill would sweep any money in excess of $300,000 in the account to the General Fund. The secretary of state is agreeable to this amount.
Renee Parker, Chief Deputy Secretary of State, Office of the Secretary of State:
The only concern about the bill is the $300,000 amount. We are looking at approximately $350,000 in expenditures for this year.
Senator Raggio:
It is not in the Executive Budget, so if we are going to have any opportunity to monitor that, we have to put it in the Executive Budget. That is our concern. There has to be some opportunity for review. The Secretary of State told me $300,000 would be adequate. Are you saying you need $350,000?
Ms. Parker:
I do not want to come back to IFC in the middle of an investigation when we probably cannot explain the reasons for the need. If we are swept down to $300,000, we will most likely have to take investigators off a project that is going on now. That amount of money will not cover our expenses. Prior to last session, we had a category 15 in our budget which funded some of the securities operating expenses. Last session we agreed to fund that out of this part instead, so we deleted that portion from our budget. We will not be able to do the investigator education we are doing now.
Senator Raggio:
I spoke to the secretary of state. What has changed since then?
Ms. Parker:
I do not think he had the budget in front of him when he spoke to you. He asked me to get all of the records and explain that today.
Senator Raggio:
We have a similar situation with the Office of the Attorney General and we only allow $250,000 in that account.
Ms. Parker:
I am not familiar with the specifics of that account, but we do fund all of our investigations and enforcement through this fund.
Senator Raggio:
We are not going to leave $3.8 million out there to be used any way you want.
Ms. Parker:
If we are taken down to $300,000, that is where we will be starting and we will lose all the ground we have been making.
Senator Raggio:
I suggest that staff work out something before we process the bill. This may be put back into the Executive Budget and we may leave an amount that is at least reasonable at this time to accommodate your concerns, but have the remainder go into the General Fund.
Ms. Parker:
Right now I cannot speak to the terms of the WSS agreement, but the Merrill Lynch agreement required that the money be used for security, investigations, and enforcement.
Senator Raggio:
Looking at the issue brief from the federal funds information for states, there are no restrictions in the settlement agreement on what states can do with their payments. Laws may vary among states regarding this money, but at this point that is the information we have. If there is any change, you can call it to our attention.
Ms. Parker:
We have been told that the terms of the settlement are confidential.
Senator Raggio:
It was finalized on April 28, and apparently there are no restrictions at this point in the settlement agreement on what the states can do with their payments.
Senator Raggio:
We will close the hearing on S.B. 498.
SENATE BILL 252: Makes various changes concerning charter schools. (BDR 34‑140)
Senator Raggio:
This is the charter school bill for which we now have the appropriate amendment.
Susan E. Scholley, Senior Research Analyst, Research Division, Legislative Counsel Bureau:
I am here on behalf of Senator Washington to represent to you that the amendment as drafted incorporates the points that we reviewed with you on Friday with one exception. That is on page 3 of Amendment No. 907. Subsection 4, in the center of the page, is an attempted resolution of the at-risk definition (Exhibit E. Original is on file in the Research Library.). This amendment has been discussed with the Department of Education and Clark and Washoe County School Districts.
The amendment on page 3 of Amendment No. 907, subsection 4, needs to be read in conjunction with subsection 3 on page 3 of the bill.
Senator Raggio:
What is the effect?
Ms. Scholley:
Subsection 3 of the bill on page 3, lines 39 through 45, overrules the existing Nevada Administrative Code provision that defines an at-risk charter school as one that has 51 percent or more of its pupils classified as at-risk students. Subsection 3 in the bill deletes that percentage and instead refocuses the definition of at-risk on what educational programs are being offered.
Subsection 4 in the blue amendment, on page 3, adds a reporting requirement for charter school that have been designated at risk, and requires them, after count day, to submit demographic information on their students so the sponsor can review the students they are serving and confirm that the school is serving an at-risk population and therefore is fulfilling its charter.
SENATOR CEGAVSKE MOVED TO AMEND AND DO PASS S.B. 252 WITH AMENDMENT NO. 907.
SENATOR TIFFANY SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
*****
SENATE BILL 214: Revises provisions concerning enforcement of requirement of registration of motor vehicle by new resident of this state. (BDR 43‑1058)
Senator Dennis Nolan, Clark County Senatorial District No. 9:
This bill was an effort to recover a significant amount of lost revenue from individuals who are not registering vehicles. Senate Bill 214 complements A.B 30, which was just passed.
ASSEMBLY BILL 30 (2nd Reprint): Revises provisions regarding the registration of motor vehicles. (BDR 43-67)
The amendments to S.B. 214 would be the enforcement effort to have individuals moving into this state, as well as those individuals not registering their vehicles, to do so. This would create a work group that would receive information both from the Department of Motor Vehicles (DMV) on newly licensed individuals who have moved to the state and have not registered their vehicles. A list would be generated by the DMV and sent to the Department of Public Safety which would log and send to local law enforcement officials who would enforce the statutes currently on the books with respect to failure to register a vehicle. The part of S.B. 214 in the amendment would create an advertising campaign that would be directed toward informing the general public that it is the law to register vehicles. It would be a fair-share type campaign so not only would the people who may not have known they had to register their vehicles in the state, but also general notification to the public that if you are aware of someone who has not registered their vehicle, should make contact through a local telephone number. A follow-up would be done to contact those individuals who had not registered their vehicles and inform them that it was the law to do so. They would have a certain time period in which to do that; otherwise the information would be sent to local law enforcement to issue a citation.
Senator Raggio:
Where is the advertising mentioned?
Senator Nolan:
That is in Section 3 (Exhibit F).
Senator Raggio:
Does it still require the appropriation of $109,000 from the Highway Fund?
Senator Nolan:
That is correct. The total lost revenue projections are approximately $10 million to $12 million.
Robert Wideman, Deputy Chief, Nevada Highway Patrol, Department of Public Safety:
The issue of the public awareness campaign is something we do not have in our budget and we would not have the ability to proceed with it without an appropriation. We will take staff time for this process out of our existing budget, and our ability to do that is dependent on the number of calls received. As this bill was related to the Department of Motor Vehicles (DMV), that department issued a fiscal note predicting there would be as many as 100,000 calls received on these hotlines. If we were to receive 20,000 calls or less per year, it might be possible to use existing staff.
Senator Raggio:
I believe this is a lost opportunity, and we need to do something about it. I think we could process this bill with the understanding that if the department needs additional funding authority, it can present a program revision and come in for that funding.
Mr. Wideman:
The department would be fine with that.
Senator Coffin:
On page 3 of the amendment, line 21, there is mention of fines, and then there is a stand-alone sentence, “the fee applies to each vehicle.” Are we jumping from fines to fees and back to fines again? I think we are talking about fines here.
Senator Nolan:
I believe you are right, Senator Coffin.
Senator Raggio:
Should the sentence be taken out?
Senator Nolan:
I think it should say the fine applies to each vehicle, because each vehicle is required to be registered.
Senator Cegavske:
How would you accomplish the advertising that you indicated would be done?
Senator Nolan:
In talking with the Department of Public Safety, the fiscal note before you of $100,000 is a radio-ad campaign. Beyond that, a public-service campaign would be used and we could look to our media community.
Senator Cegavske:
Would there be funding for a brochure to be put in places such as real estate offices or rental businesses? Perhaps something that could be put in a packet when an individual buys a home?
Mr. Wideman:
We want to look at the public awareness campaign in the broadest possible terms in this measure. I do not know which would be most cost-effective. The public awareness campaign would be handled by the Department of Public Safety, Public Information Office. We would be looking to that office for guidance and trusting its experience.
SENATOR CEGAVSKE MOVED TO AMEND AND DO PASS S.B. 214 BY CHANGING THE AMOUNT OF THE APPROPRIATION TO $100,000 AND TO REPLACE THE WORD “FEE” BY THE WORD “FINE” PRECEDING THE LANGUAGE “APPLIES TO EACH VEHICLE.”
SENATOR COFFIN SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
*****
Nevada Legislature Interim – Budget Page LCB-4 (Volume 1)
Budget Account 327-2626
Lorne J. Malkiewich, Director, Director’s Office, Administrative Division, Legislative Counsel Bureau:
I recommend budget account 327-2626 be closed as recommended. There are six employees, no new employees, no upgrades, and therefore I propose it be closed as recommended.
SENATOR TIFFANY MOVED TO CLOSED BUDGET ACCOUNT 326-2626 AS RECOMMENDED BY THE GOVERNOR.
SENATOR MATHEWS SECONDED THE MOTION.
THE MOTION PASSED. (SENATORS RAWSON AND CEGAVSKE WERE ABSENT FOR THE VOTE).
*****
Legislative Counsel Bureau – Budget Page LCB-1 (Volume 1)
Budget Account 327-2631
Mr. Malkiewich:
The handout I presented (Exhibit G) shows the proposed adjustments to the budget of the Legislative Counsel Bureau (LCB). We proposed to cut out-of-state travel in half in each fiscal year, both for Legislators and staff.
Senator Raggio:
Would that still accommodate one trip per year for Legislators?
Mr. Malkiewich:
Yes, at least one per year. We have one fully funded and one partially funded now.
Senator Raggio:
Are you providing an exception when members have leadership positions at some of the national committees? How would that be addressed?
Mr. Malkiewich:
The newly appointed Legislative Commission will be meeting, and that will be one of the items on the agenda. We will propose a change in the out-of-state travel policy reflecting the action in closing this budget that restricts out-of-state travel, but, as you indicate, allows exceptions for people in positions of leadership.
Senator Coffin:
Annual meetings are not the only meetings that are important to people serving on committees. There are important Internet taxation and other issues that come up in two meetings. If there is discussion about going from two and one to one partial and one full, I can understand that as being acceptable. I thought there was discussion on just one trip. Could we get clarification?
Mr. Malkiewich:
It will be up to the Legislative Commission to decide. We will be discussing that Friday morning. It may be that we could allow one funded trip and one partially funded and still be able to make it within this budget. The budget will be cut back quite a bit. This is a compromise. There was discussion of cutting far more than this.
Senator Cegavske:
When the word “partial” is used, is it only expenses?
Mr. Malkiewich:
Yes. That would not include payment of salary; however, it does cover the big out-of-pocket expenses, the travel and the lodging.
Senator Raggio:
We should note that the director of the Legislative Counsel Bureau was instructed to make some reductions in the budget for requiring the Executive Branch to do so, and we felt it was also essential to the Legislative Branch as well.
Mr. Malkiewich:
The next item on the list is a reduction of utilities. The proposal is to reduce maintenance items for anticipated increases in the cost of utilities. In item 3, building projects, we have a few roofing projects such as the front entry to the building. Next we have miscellaneous, small reductions. We moved several positions from being funded partly as session hires, partly as intermittent employees. We wanted to make those permanent. The following four items are additions. First, appropriations from the No Child Left Behind legislation were moved into the budget here. We have worked out an agreement with the Executive Branch to pay one-quarter of what the Executive Branch does. We would still be able to get some of the services from the Department of Personnel, most notably the employee assistance program. Next, we would add funding for an executive assistant for support of leadership out of session, and the final item is a reclassification of the currently vacant education analyst position in the Fiscal Analysis Division as a program analyst. The $7,500 appropriation for participation of transportation chairmen in the Multistate Highway Transportation Association was not anywhere in the budget, so it was proposed to be put in the budget for LCB to cover expenses.
In closing, I would like the approval of the committee to meet with staff and propose nondollar adjustments to some of the grades in the Legislative Counsel Bureau.
Senator Raggio:
Will you have enough staff after the session adjourns for the interim?
Mr. Malkiewich:
I believe so. We could use more. The two key areas are the Fiscal Analysis Division and Legal Division. During the interim we have a problem with Research Division because of the interim studies, particularly with the large number of statutory committees and the various studies referred to them.
Senator Raggio:
How many interim study committees are we proposing, and can we staff them?
Mr. Malkiewich:
We propose adding three to each house, but that is not all we get. We end up having various studies referred to the committees on public lands, health care, or education. Then we add statutory committees from time to time.
Senator Tiffany:
For travel to Los Angeles by various committees, since those funds have been cut back, is it legitimate to use campaign money for hotel, food, and airline costs?
Mr. Malkiewich:
I believe so, but you would have to check with the Legal Division.
SENATOR RAWSON MOVED TO APPROVE BUDGET ACCOUNT 327‑2631 AS RECOMMENDED WITH AUTHORITY TO MAKE SOME NONMONETARY CHANGES.
SENATOR CEGAVSKE SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
* * * * *
SENATE BILL 208: Requires transfer of money from Fund for School Improvement to University and Community College System of Nevada to provide scholarships for students pursuing degrees in teaching. (BDR S‑1033)
Senator Raggio:
On May 24, we voted for Amendment No. 911. The amount was changed to $122,000 because the interest we were anticipating would not produce that amount.
With no objection from the committee, we will utilize Amendment No. 911 to S.B. 208 and report the bill out with an amend and do pass.
SENATE BILL 51: Extends date by which certain prerequisites must be satisfied for State Board of Finance to issue general obligation bonds to assist in construction of California Immigrant Trail Interpretive Center in Elko County. (BDR S-674)
Mr. Ghiggeri:
The amendment that we have permits the use of an in-kind match; however, Senator Rhoads has requested that the date be changed from 2005 to 2007.
Senator Raggio:
We will need to have that amendment corrected, also allowing for the in-kind match.
SENATE BILL 235 (1st Reprint): Revises provisions governing payment of hospitals for treating disproportionate share of Medicaid patients, indigent patients or other low-income patients. (BDR 38-746)
Senator Rawson:
I have one point of discussion. It will take care of most of the concerns expressed. With proposed Amendment No. 886, the bill sets $1.2 million aside for use by private hospitals that have a disproportionate share of Medicaid patient reimbursements in the large counties. That amount could be changed to $2.4 million if we did not reserve as much as we have reserved in the State.
Senator Tiffany:
St. Rose Dominican Hospital and Valley Hospital had a problem because they felt they were left out. What is different this time for that situation?
Senator Rawson:
Throughout the discussions neither raised the issue nor wanted to join in the discussion, and at this point, it leaves a threshold that Valley Hospital is used to getting. St. Rose Dominican Hospital is not far from receiving a larger share. They would not be included in this.
Senator Tiffany:
Could you explain the amount available for Sunrise Hospital?
Senator Raggio:
Yes, it is one-sixth of the amount of money available, which is $1.2 million, so that would represent about $200,000. However, the bill is structured so if there is less money, these figures would be adjusted down. It looks as though approximately $180,000 would go to Sunrise Hospital. Just under $1 million would go to Lake Mead Hospital. They would be the only two private hospitals that qualify. Lake Mead Hospital is not defined by name here, but it is defined in the bill as “those private hospitals receiving disproportionate share,” and those two received disproportionate share.
Senator Coffin:
On page 3, I have a question on what the language meant on Sunrise Hospital. It did not contain a dollar figure. If it is only $180,000, I wonder whether the bill as amended would take into account what is spent taking care of the people in the neighborhoods surrounding that hospital.
Senator Rawson:
It would not. That is why I suggested that if the State were able to reserve less than the $3 million that we reserved in our disproportionate share account, and if we put in $2.4 million, that would double the amount of money going to Sunrise Hospital. I think it is appropriate to move this bill, and if the Assembly Committee on Ways and Means agrees to that, the budget figure could be changed.
Senator Coffin:
This one neighborhood probably has a population greater than most of the towns receiving money, yet the towns are getting more money than Sunrise Hospital.
Senator Rawson:
That is true. However, in our discussions I believe we agreed that these single hospitals in rural communities are key to those communities. All of the hospital entities involved in the discussion agreed we should not harm the rural hospitals.
Senator Coffin:
Are you satisfied, or is it likely that there will be more diversion from the private hospitals to the public hospitals because of the formula?
Senator Rawson:
I do not think so. The private hospitals, because of the changing demographics in their areas, are stepping up to handling the patients that are presented to them and they are seeing more indigent patients. I would suggest to the Assembly Committee on Ways and Means that they adjust this figure of $1.2 million to $2.4 million. My suggestion would be to amend and do pass.
Senator Cegavske:
Where is the William Bee Ririe Hospital located?
Senator Rawson:
That is located in Ely.
Senator Cegavske:
That hospital is up to $204,000, and Humboldt is up to $215,000. Do they have that many indigents?
Senator Rawson:
These hospitals are subsidized because they are the only providers in those areas. If those hospitals are lost, it is a matter of not only transporting patients to a larger county, but also of the larger county having to accept the indigent load. I think all of the parties agree that we should protect those rural hospitals.
Senator Coffin:
On the private hospitals, how did the payments to them work out compared to what they have been getting?
Senator Rawson:
In the last biennium we had $800,000 that went to Lake Mead Hospital and $700,000 to Sunrise Hospital. This would increase the amount that goes to Lake Mead Hospital and significantly decrease the amount that goes to Sunrise Hospital unless we are able to put more money into the funding.
Senator Coffin:
I do not understand why Sunrise Hospital would be cut from $700,000 to $180,000 when there is more population in a block in the neighborhood of Sunrise Hospital than in a whole town where there is a rural hospital.
Senator Rawson:
This comes out of the interim study. An independent firm came in and developed a formula for us, and the formula discounted a lot of the indigent care that Sunrise Hospital gives. We have tried to make an adjustment to this.
Senator Mathews:
I agree with Senator Coffin that Sunrise Hospital receives a lot of indigent individuals.
Senator Raggio:
Is there anyone who has concern about the one-sixth? If so, I will have to go back and work on the formula.
ASSEMBLY BILL 515 (2nd Reprint): Makes various changes to provisions governing property tax assistance for senior citizens. (BDR 38-499)
Senator Raggio:
I think we can process A.B. 515.
SENATOR RAWSON MOVED TO DO PASS A.B. 515.
SENATOR RHOADS SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
*****
Senator Raggio:
This meeting is adjourned at 11:30 a.m.
RESPECTFULLY SUBMITTED,
Julie Walker,
Committee Secretary
APPROVED BY:
Senator William J. Raggio, Chairman
DATE: