Lawmakers pump brakes on DMV plan to pay back $1 technology fees that were ruled unconstitutional

The Nevada DMV’s plan to pay back millions of collected $1 fees — charges declared unconstitutional by the state Supreme Court — is temporarily on ice after state lawmakers said they want additional buy-in on the plan.

Members of the Interim Finance Committee on Wednesday opted to not accept the agency’s plan to transfer $6 million in collected technology fee payments into a new refund budget account and attached disbursement plan. IFC Chair Sen. Chris Brooks (D-Las Vegas) lauded the proposal as a “creative solution” but said the committee wanted explicit approval from the court and state Senate Republicans (who filed the initial legal challenge over the fees).

“Once we pull the trigger on this, this work program, then it's out of our hands until it falls in our lap,” Brooks said.

The required payments are the result of a May decision by the Nevada Supreme Court finding that two taxes — the DMV $1 fee and a higher payroll tax rate — were unconstitutionally extended in 2019 beyond their set-in-statute expiration dates without a two-thirds vote, required for any tax bill passed by legislators. The lawsuit was filed by all members of the state Senate Republican caucus shortly after the close of the 2019 legislative session.

But while the Department of Taxation has made progress on refunding unconstitutionally collected payroll tax — reporting last week that it had refunded a total of $30.6 million to more than 22,600 businesses — the DMV has faced more roadblocks in its task to return millions of $1 transaction fees to customers.

Multiple legislative solutions to pay back the fees were proposed but ultimately dropped in the final days of the 2021 legislative session, with exasperated lawmakers finally deciding to give the DMV a $7.8 million check to pay back $5.9 million in transaction fees and related costs.

Nevada DMV Director Julie Butler briefed lawmakers on the agency’s plan — it would run a customer query and send postcards or a letter to all individuals who paid the technology fee in the 2021 fiscal year, giving them instructions on how to claim their refund. Those individuals could log onto a “secure website” and select their refund preference — either receiving it through an electronic transfer (Zelle), or opting for a paper check. 

Individuals also could opt out of receiving a refund and allow the DMV to keep the technology fee as a “donation,” and customers who did not respond within a certain amount of time would have their refunds kept in the state’s Unclaimed Property system. Those who paid multiple installments of the $1 fee (such as for multiple vehicles or trailers) would receive their refund and interest in a single payment.

Butler said those steps were necessary because the cost of simply sending a $1 paper check to affected customers in the state could end up costing close to $50 or $60 per check, and the agency wanted to give customers the option to opt-out after receiving several calls from customers indicating they were not interested in receiving a refund.

Asked whether the plan had the blessing of the court or attorneys for the state Senate Republicans who filed the initial lawsuit, Butler said their approval wasn’t necessary. She said she made an error in telling legislators in the final days of the 120-day session that any repayment plan needed the court or GOP buy-in, and that the agency wanted to move quickly to “get these refunds out to our customers as quickly as possible.”

“I do know our attorney has talked about our plan with opposing counsel, (but) whether or not they like the plan, it's really the department’s plan to comply with the court order,” Butler said. “We believe it's a good plan, and the more that we dither around with this, the longer it's going to take us to effectuate these refunds.”

But that course of action was questioned by Assemblywoman Maggie Carlton (D-Las Vegas), who said she wanted the buy-in from the Republicans who challenged the initial tax extension, lest they bring another lawsuit forward for not following the terms of the state Supreme Court’s order.

“I think we need to get everybody on the same page saying, ‘This is the way to move forward,’ so that we can get this finished and over and done with,” Carlton said. “We're already spending more money on it than we probably should, money that could be going to a lot of other places.”

Butler said she had spoken with Republican Senate Leader James Settlemyer (R-Minden) in May, but that his suggestions were untenable — issuing a credit on future transactions could end up benefiting new residents or other individuals who did not pay the fee, and the programming costs of adding a $1 credit to existing charges would cost “significantly more” than the plan proposed to legislators.

“We feel that this is the best solution in a bad situation,” she said.

Ultimately, Brooks instructed the DMV to bring the item back during the next IFC meeting, saying that more “conversations” needed to take place before he was comfortable moving forward with the plan.

“I think there is more work that needs to be done to give us the level of comfort we need to make sure that we're all on the same page, and that we are going to satisfy all parties involved, including the taxpaying Nevadans,” he said.

Why Nevada is spending $8 million to refund millions of $1 DMV fees

In the near future, Nevada drivers and anyone who made a transaction at the state Department of Motor Vehicles over the past two years is in line for a somewhat meager payday — a refund of the $1 per transaction technology fee.

Although the actual form of the refunds is still undetermined, the state has allocated roughly $7.8 million to pay back a total of $5.1 million worth of the $1 technology fees assessed on all DMV transactions over the past two years.

Refunds of the technology fee — which has been in place since 2015 and was designed to fund a long-awaited but scandal-stricken DMV system modernization upgrade — didn’t exactly come as a surprise. The fee and an extension of the state payroll tax were challenged by state Senate Republicans in a 2019 lawsuit, and the state Supreme Court ruled in their favor in May 2021, requiring that the state pay back the unconstitutionally extended taxes collected over the past year.

While the DMV this session had requested a further extension of the $1 fee (which legislators did not approve), the agency also had made plans in case of an adverse ruling from the state Supreme Court, sequestering about $5.9 million in fee revenue in case it was ordered to pay the amount back to customers.

But paying back 5.9 million worth of $1 fee transactions comes at a cost — $7.8 million in state Highway Fund dollars, which legislators appropriated to the DMV through a last-minute amendment in the final days of session. 

A DMV spokesman said the agency was still working on details of the refund payments, and that any proposal would need to go through legal review, be approved by all parties involved in the court case and finally receive approval through the Interim Finance Committee — meaning any refund payments are likely months away.

Frustration over the situation was palpable among legislators in the final week of session.

“The biggest part of this whole damn thing is they need the money to fix the technology, so that if they had this problem again, they'd have the technology to fix it,” Assembly Ways and Means Chair Maggie Carlton (D-Las Vegas) said in a late May interview. “It's chicken and the egg, it's just circular. It's crazy. This is a circular firing squad.”

After the state Supreme Court handed down its decision in early May, legislators introduced several bills — AB488, AB491, AB490 — aimed at either retroactively enacting the technology fee or appropriating dollars to the DMV to help cover the cost of issuing refunds.

But all of those measures ran into a similar problem — Republican lawmakers (whose votes would be needed to exceed the constitutional two-thirds majority needed for any tax increase) were generally against any kind of legislative maneuvering to keep the fees in place, either going forward or retroactively.

During a late May hearing on AB488, which would have extended the fee through June 2026 and also would have retroactively permitted the fee from the end of June 2020 onward, state senators James Settelmeyer (R-Minden) and Keith Pickard (R-Henderson) took the unusual step of testifying in person against the bill.

“Judgment has been entered by the District Court in favor of the plaintiffs in the two-thirds case and, in particular, the judgment in favor of the taxpayers and the fee payers,” Settelmeyer said at the time. “I don't want to belabor this point. I'm tired of litigation. People deserve their money back.”

Without a clear path to a two-thirds majority to implement or reinstate the technology fee, Democratic legislative leaders instead opted to focus on allocating funding to the DMV to process the refunds. During a Saturday, May 29 evening budget meeting on AB490, an appropriations bill covering the cost of conducting the refunds. Carlton said lawmakers had a “responsibility to do this now.”

“Believe me, I'd much rather spend this $8 million on autism, that would help solve a big problem with autism right now, but instead we are spending $8 million on helping the DMV refund $5 million,” she said at the time. 

Republican lawmakers on the committee chafed — Assembly Minority Leader Robin Titus (R-Wellington) suggested that since the court gave no timeline, lawmakers could wait and see if the DMV could instead implement a credit system rather than sending out checks. Assemblyman Tom Roberts (R-Las Vegas) suggested that lawmakers put the money in a contingency fund and dole it out through the Interim Finance Committee once the DMV had a more solid plan or other options in place.

“I do believe it's a little premature. I think there's some other options that we can do later on,” Roberts said.

An irked Carlton opted to set the bill aside, saying that she wanted to ensure that a repayment option was actually supported, and was “not just being suggested, and then still voted against, which I have had an experience with this year.”

“Madame Chair, I'll give you my word if that's the way that we go, I’ll support it.,” Roberts replied.

“No comment,” Carlton replied.

Between Republican skepticism and the truncated timeframe of the final days of the session, all three of the legislative fixes to the DMV fee issue were relegated to the legislative dustbin and never advanced past the hearing stage.

Death of the technology fee will not immediately affect the DMV’s planned system modernization upgrades. Language included in one of the budget implementation bills (AB494) directed the state to allocate an additional $13.6 million to the project if the two proposed Assembly bills AB488 and AB491 failed to pass.

Instead, lawmakers opted to amend language into SB457 — another last-minute measure authorizing the DMV to use a greater share of state Highway Fund dollars — that appropriated $7.8 million for the cost of issuing refunds of the technology fees.

“There is no time to wait, and we need to get it done now,” Carlton said prior to Assembly adoption of the amendment.

College athlete compensation, cannabis investigations and ‘pot for pets’ among latest bills signed by Sisolak

As Nevada lawmakers work through the final weekend before the adjournment of the 120-day legislative session, Gov. Steve Sisolak has also been busy fulfilling his end of the process — signing more than 40 bills into law on Friday and Saturday.

Some of the higher-profile measures signed by Sisolak over the past two days include bills aimed at allowing collegiate athletes to receive compensation, lowering the penalties for minors caught in possession of alcohol or small amounts of marijuana, requiring teaching about minorities and historically underrepresented groups and raising the legal and age prerequisites for a person to become state attorney general.

Sisolak had signed 174 bills into law as of Saturday evening. Once bills are approved by both houses of the Legislature and sent to the governor’s office, the state’s chief executive has five days during sessions and 10 days after they adjourn to either sign the bill, veto the measure or allow the clock to expire, which causes a bill to automatically become law.

Here’s a look at some of the major bills signed by Sisolak on Friday and Saturday. For a full list of bills signed by the governor this session, click here.

AB101: ‘Pot for pets’

Sponsored by Assemblyman Steve Yeager (D-Las Vegas), AB101 authorizes licensed veterinarians to administer products containing CBD or hemp in the treatment of an animal and to recommend use of such products to pet owners. It also prohibits the state Board of Veterinary Medical Examiners from taking disciplinary action against veterinarians who administer or use such products.

The bill passed unanimously out of the Senate and Assembly. 

AB158: Lowering penalties for minors caught buying alcohol or marijuana

This measure sponsored by Assemblywoman Daniele Monroe-Moreno (D-North Las Vegas) generally lowers the criminal penalties for minors found in possession of alcohol or small amounts of marijuana. 

Specifically, the bill prohibits imprisonment or a fine and instead requires any such person under the age of 21 found in possession of the prohibited substances to perform up to 24 hours of community service, attend a panel of victims of persons killed or injured by intoxicated drivers or undergo an evaluation to see if they have an alcohol or substance abuse disorder.

The bill also requires the automatic sealing of criminal records related to underage possession once a juvenile successfully completes the terms and conditions set by a court.

It passed unanimously out of the Senate and Assembly.

AB177: Prescription drug instructions in non-English languages

This measure, sponsored by Assemblywoman Teresa Benitez-Thompson (D-Reno), requires most pharmacies in the state to provide specific instructions on the use of a prescription drug in a language other than English, if requested by the recipient. It exempts pharmacies from civil liability if they contract with a third party translation service and injury cannot be linked to the “negligence, recklessness or deliberate misconduct of the pharmacy or employee.”

The measure passed out on a party-line 26-16 vote in the Assembly, but passed the Senate unanimously after an amendment was added granting civil immunity to pharmacies.

AB200: Regulations for veterinary telemedicine

Sponsored by Assemblywoman Shannon Bilbray-Axelrod (D-Las Vegas), the measure establishes regulations for veterinary telemedicine, allowing licensed veterinarians to practice telemedicine only after an in-person examination of an animal. Under the bill, veterinarians would not have to examine every member of a herd to consult remotely, and a doctor with access to medical records could also consult via remote communication.

The measure passed out of the Assembly on a 40-2 vote and then unanimously out of the Senate.

AB254: College athletes can profit off likeness

This bill from Assembly Speaker Jason Frierson (D-Las Vegas) would prohibit colleges or the National Collegiate Athletic Association (NCAA) from preventing student athletes from being compensated for use of their name, image or likeness. It’s intended to align with planned moves by the NCAA to allow for student-athlete compensation.

The bill also requires that the Legislative Committee on Education conduct an interim study concerning the issue.

It passed on a 34-8 vote in the Assembly and on a unanimous vote in the Senate.

AB261: Teaching about history of underrepresented groups 

This measure, sponsored by Assemblywoman Natha Anderson (D-Sparks), requires Nevada students to learn about the history and cultural contributions of minorities and historically underrepresented and discriminated against groups, including Native Americans, members of the LGBTQ community and African Americans. It would also require that textbooks and instructional materials accurately portray the history and contributions of marginalized groups.

The bill passed on party-line votes in the Senate and Assembly, with Republicans in opposition.

SB58: Cannabis investigations

This bill expands the duties of the Investigation Division of the Department of Public Safety to include assisting in investigations related to cannabis that the Department of Taxation or the Cannabis Compliance Board might be undertaking, if those agencies request the help. 

The bill passed unanimously in both houses.

SB66: Connecting kids to computers

This bill expands the work of the Office of Science, Innovation and Technology, calling on the agency to develop a statewide system to determine the extent to which students have access to the internet and computers in their homes. It also tasks the office with helping connect students to that technology. 

The bill passed unanimously in the Senate and on a 35-4 vote in the Assembly, with some Republicans opposed.

AB227: Cracking down on independent contracting in construction

This bill bars contractors from hiring people who don’t have a contractor’s license and are not their direct employees to do work for a contractor that requires a contractor’s license. Backed by Assemblywoman Maggie Carlton (D-Las Vegas), the bill is one strategy to tackle the issue of employee misclassification but was opposed by all Republicans.

The bill passed on party-line votes in both houses.

AB190: Sick leave used to care for family

This bill requires that employers who offer sick leave to their workers also let those employees use that accrued time to attend to medical needs of their immediate family, whether that be for an illness, injury or doctor’s appointment. It allows employers, however, to limit the amount of sick leave a worker can use for that purpose.

The bill, sponsored by the Assembly Commerce and Labor Committee, includes a preamble stating that caregivers in Nevada provided 324 million hours of uncompensated care in 2013, at an estimated value of $4.27 billion.

The measure passed unanimously in the Senate and on a 30-12 vote in the Assembly; all who voted against it are Republicans.

AB236: Raising requirements to be attorney general

This bill, sponsored by Assembly Speaker Jason Frierson (D-Las Vegas), raises the prerequisites for serving as attorney general. It requires the person in that role to be at least 30 years old — up from the current minimum age of 25 — and have lived in Nevada for at least three years, up from two.

The person must also be a member in good standing of the Nevada Bar.

Frierson said that the duties of the office have become increasingly complex over the years, and Nevada’s minimum qualifications have not kept up with the prerequisites common in other states. Opponents said other constitutional offices, such as governor or treasurer, only require the person to be 25 and have no other professional prerequisites.

Sen. Ira Hansen (R-Sparks) also said it gives way too much latitude to the state bar and limits the choices of Nevada voters.

The bill passed 31-11 in the Assembly and 12-8 in the Senate. All those who voted against it were Republicans.

SB362: Operating a ‘microtransit’ system

The bill authorizes the Regional Transportation Commission in Clark County to offer microtransit services, or transportation by a multi-passenger vehicle that carries fewer passengers than vehicles used on regular routes and is dispatched through a digital application service.

The measure passed unanimously out of the Senate and on a 36-5 vote in the Assembly.

SB363: Reporting requirements for charter schools

This measure requires charter schools that contract with education management companies to submit a report to the sponsor of the charter school, detailing the amount paid to those companies in the current and preceding fiscal years. Charter schools will also have to submit the same report to the director of the Legislative Counsel Bureau in even-numbered years.

The bill passed on a 19-2 vote in the Senate and a 35-6 vote in the Assembly.

AB181 - Mental health parity, attempted suicide report

This bill requires health care providers to report cases or suspected cases of attempted suicide to the state, with that information reported annually to the Patient Protection Commission. It also calls for an evaluation by the state Insurance Commissioner on whether insurers are adhering to a federal law requiring mental health parity — not limiting mental health benefits more than physical health benefits.

The measure passed 26-16 in the Assembly and 14-6 in the Senate. Those opposed were Republicans.

This story was updated on Sunday, May 30, 2021 at 12:53 p.m. to reflect that Assemblywoman Natha Anderson was the primary sponsor of AB261.

Sisolak signs more than 70 bills, including sealing eviction records during COVID, Patient Protection Commission reorganization and curbside cannabis pickup

Measures sealing eviction records during the COVID-19 pandemic, authorizing curbside cannabis pickups and reorganizing the Patient Protection Commission have all been signed into law by Gov. Steve Sisolak.

Sisolak’s office announced late Thursday that the governor had signed a total of 70 bills in a press release, bringing the governor’s total of signed bills from the 2021 session up to 107 as of Friday. Once bills are approved by both houses of the Legislature and sent to the governor’s office, the state’s chief executive has five days during sessions and 10 days after they adjourn to either sign the bill, veto the measure or allow the clock to expire, which causes a law to automatically take effect.

Here’s a look at some of the bills signed by Sisolak on Thursday:

AB141: Sealing COVID-19 eviction records

Sponsored by Assemblyman Howard Watts (D-Las Vegas), the measure requires courts to automatically seal records for people evicted during the pandemic. Originally, the bill also proposed requiring landlords to give certain long-term tenants two or three months of advance notice before “no cause” eviction -- those stemming not from a breach of contract but for any reason the landlord wanted. But that provision was removed.

As amended, the bill passed on a party-line 26-16 vote in the Assembly and a 12-8 vote in the Senate.

AB348: Patient Protection Commission reorganization

Sponsored by Assemblywoman Maggie Carlton (D-Las Vegas), the bill provides for a reorganization of the Patient Protection Commission, changing it from a primarily industry-focused body to one centered around patient advocates and those who work in the nonprofit health care space. It also requires that the commission adopt bylaws to govern its operation.

The measure additionally designates the Patient Protection Commission as the state agency responsible for administering and coordinating the Peterson-Milbank Program for Sustainable Health Care Costs, which is aimed at reducing per-capita spending on health care and analyzing and addressing the underlying drivers of growth in the cost of health care.

The bill passed on a party-line 26-16 vote in the Assembly and a party-line 12-9 vote in the Senate.

SB168: Curbside cannabis pickup

Sponsored by Sen. Roberta Lange (D-Las Vegas), this bill authorizes and allows recreational marijuana dispensaries to engage in curbside pickup — in effect legalizing a practice first allowed last year when the state was still in a coronavirus-related stay-at-home order.

The measure authorizes the state Cannabis Compliance Board to adopt regulations related to curbside regulation, while allowing local governments to adopt ordinances beyond whatever rules are adopted by the compliance board. It also modifies several existing portions of law related to the packaging and labeling of marijuana products.

SB168 passed on a 35-6 vote in the Assembly and on a 19-1 vote in the Senate.

AB187: Designates the month of September as “Ovarian and Prostate Cancer Prevention and Awareness Month” in Nevada. 

This bill, which requires the governor to issue a proclamation every September encouraging the observance of Ovarian and Prostate Cancer Prevention and Awareness Month, was sponsored by Assembly Speaker Jason Frierson — who earlier this session underwent treatment for prostate cancer.

The bill passed unanimously out of both the Senate and Assembly.

AB59: Raising smoking age to 21

Sponsored on behalf of the attorney general’s office, AB59 raises the legal age to purchase cigarettes or other tobacco products to 21 years of age, up from the past minimum of 18 years of age. It aligns the state with federal law — former President Donald Trump signed a law in December 2019 raising the minimum age on tobacco sales up to 21 years of age.

The bill passed on a 34-8 in the Assembly and 14-7 in the Senate.

AB109: Charter school teacher licensure

This measure requires that at least 80 percent of teachers working at a charter school hold a license or endorsement to teach in Nevada, including 100 percent of teachers providing instruction in a “core academic subject, English as a second language or special education.” Non-licensed instructors have to meet certain requirements, but instructors without a license are allowed to continue teaching until July 1, 2026 before they have to obtain a teaching license.

The bill passed on a 31-9 vote in the Assembly and a 12-8 vote in the Senate.

AB111: Expanding diversity of Peace Officers’ Standards and Training Commission

Sponsored by Assembly Speaker Jason Frierson (D-Las Vegas), the measure increases the membership of the Peace Officers’ Standards and Training Commission from 9 to 11 members and requires the Majority Leader of the Senate and Speaker of the Assembly to each appoint one member who is not a peace officer and has demonstrated expertise in: implicit and explicit bias, cultural competency, mental health as it relates to policing  or working with vulnerable populations. The bill also requires the governor and Assembly and Senate leaders to consider racial, gender and ethnic diversity when making appointments.

The bill passed on a 42-0 vote in the Assembly and a 12-8 vote in the Senate.

AB123: Golden Knights license plate fees

The measure imposes an additional $10 fee on Vegas Golden Knights special license plates and $10 for renewal for deposit with the treasurer for credit to the General Fund. The bill also requires the Treasurer to distribute additional fees from the Vegas Golden Knights license plates to the Vegas Golden Knights Foundation on a quarterly basis.

The bill passed on a 30-12 vote in the Assembly, and a unanimous vote in the Senate.

AB336: Annual behavioral health care assessment for law enforcement officers

The bill, sponsored by Assemblywoman Daniele Monroe-Moreno, requires the Peace Officers’ Standards and Training Commission to adopt regulations establishing standards for an annual behavioral wellness visit designed to preserve the emotional and mental health of law enforcement officers. The visit would also assess conditions that may affect performance of duties.

The bill passed on a 33-9 vote in the Assembly and a 17-4 vote in the Senate.

AB409: Addressing implicit bias in law enforcement recruitment

The measure requires the Peace Officers’ Standards and Training Commission to adopt regulations addressing bias in the recruitment and selection of law enforcement officers. Under the bill, the commission would have to include evaluations to identify implicit bias on the part of an officer on the basis of race, color, religion, national origin, physical or mental disability, sexual identity or gender identity or expression.

The bill passed the Assembly on a 36-6 vote and the Senate on a 17-4 vote.

AB378: Federal and state land management

A measure aimed at reversing many of the public land policies and laws of the state hostile to federal control of public lands, AB378 repeals and changes many provisions in state law originally sponsored by supporters of the ‘Sagebrush Rebellion,” the movement in the 70s seeking more local control of federal public lands.

The bill passed on a party-line 26-16 vote in the Assembly and on a narrow 11-10 vote in the Senate, with Sen. Dina Neal (D-Las Vegas) joining Republicans in opposition.

AB435: Expands tax exemptions to trade shows/meetings

Under current law, every business entity in the state whose gross revenue during a fiscal year exceeds $4 million pays an annual Commerce Tax. But, there are exemptions for businesses that take part in an exhibition held in the state for conducting business and are not required to obtain a state business license for the exhibition because the exhibition facilitator pays the licensing on behalf of that business.

The bill expands the exemptions from the Commerce Tax to apply to anyone who takes part in an exhibition, trade show, industry or corporate meeting held in the state, regardless of whether the person is required to obtain a state business license. It also clarifies that an organizer, manager or sponsor of such an event or an exhibitor may claim the exemption.

The bill passed out of the Assembly on a 41-1 vote and the Senate on a 20-1 vote.

SB46: Protecting personal information

The bill, sponsored by the Senate Committee on Government Affairs, allows employees of the attorney general to request that personal information be kept in a confidential manner. For example, under the legislation employees can request the DMV to display an alternate address on his or her identification card.

SB46 passed unanimously out of the Senate and then on a 33-8 vote out of the Assembly.

SB114: CBD and hemp-infused foods

Sponsored by Sen. Pete Goicoechea (R-Eureka), SB114 generally authorizes certain food establishments to sell hemp or CBD-infused food products. The bill passed unanimously out of the Assembly and on a 20-1 vote in the Senate.

SB379: Health care provider database

The bill, sponsored on behalf of the interim Legislative Committee on Health Care, requires the state’s Department of Health and Human Services to create and maintain a database of demographic and practice information on health-care providers and make the data available to professional licensing boards upon request. It also requires the state health agency to establish a Health Care Workforce Working Group to analyze information in the database and study ways to attract healthcare providers to the state. 

SB379 passed on a 35-6 vote in the Assembly and on a 20-1 vote in the Senate.

Corrected on Friday, May 28, 2021, at 3:40 p.m. to reflect that AB348 reorganizes the Patient Protection Commission but does not establish an all payer claims database.

Bill requiring legislative audit of higher education system clears Assembly

The Assembly approved AB416 Wednesday, a bill sponsored by the Assembly Education Committee that would authorize a legislative audit to comb through a specific slice of financial records for the Nevada System of Higher Education (NSHE) dating back to fiscal year 2019.

In particular, the audit will look at the system’s non-state appropriated funding and so-called “reserve accounts,” as well as gifts from private donors and capital project money used by UNLV and UNR. The Assembly passed the bill unanimously late Wednesday.

Still, the language approved Wednesday was vastly scaled back from an original version of the bill that would have required an audit of all of NSHE’s budget accounts — including both state-funded and self-supporting budgets — as well as audits for salaries, bonded debt and compliance with state, local and federal laws for fiscal years stretching back to 2014. 

That original language would have come with a roughly $700,000 price tag, so broad in scope that state auditors “would have had to, literally, reassign our entire office,” Legislative Auditor Dan Crossman told lawmakers. 

To that end, Assembly Education Committee Chair Shannon Bilbray-Axelrod described the cost as “a ridiculous amount of money” and said that broad scope was “never going to move forward” through legislative money committees. She added that it was a cost and level of effort that was largely moot, as NSHE already provides legislators with similar budget reports on its state funding.  

The push for an audit comes as lawmakers have sought to more broadly expand oversight over the state’s higher education system and the way it spends money. 

As the system and the regents governing it have pointed to the power of the purse as an ideal accountability tool in the wake of efforts to expand legislative oversight powers, legislators have long complained that NSHE’s accounts are complex and frequently opaque. 

Even this session, as lawmakers moved to restore tens of millions in cuts to higher education funding, Assembly Ways and Means Chair Maggie Carlton (D-Las Vegas) raised concerns across several budget hearings that NSHE’s budget was obscured “behind a curtain.” 

As a result, lawmakers have argued, there is often little time to parse how hundreds of millions in public dollars are being spent over the course of biennial legislative sessions. 

The audit from AB416 would also serve as something of a dry run should voters eventually approve SJR7, a proposed constitutional amendment that would mimic last year’s failed Ballot Question 1 by seeking to remove the Board of Regents from the state Constitution. 

Among the key differences between SJR7 and Question 1 is a new provision requiring legislators to provide for a biennial audit of the “state university and any other public institutions of higher education.”

Though legislators would have the power to call for an audit irrespective of the requirement included in SJR7 — as they are now with AB416 — backers of the measure have said the language was included in large part because voters had asked for it in the aftermath of Question 1’s failure.  

As a legislatively proposed constitutional amendment, SJR7 would need to pass through two legislative sessions and a general election vote before taking effect. The resolution cleared the first of those hurdles last week, passing through the Assembly 30-11 and on to the next legislative session.

Editor’s Note: This story first appeared in Behind the Bar, The Nevada Independent’s newsletter dedicated to comprehensive coverage of the 2021 Legislature. Sign up for the newsletter here.

Lawmakers clarify price tag for expanding undocumented student access to Silver State Opportunity Grant

unlv campus

Allowing undocumented Nevada students to apply for the need-based Silver State Opportunity Grant without filling out a FAFSA (Free Application for Federal Student Aid) form, which requires a Social Security number, would cost about $250,000 annually, officials told lawmakers on Thursday. 

Attending college can be particularly burdensome for students without legal status, who are ineligible for awards such as the federal needs-based Pell Grant. 

While AB213 does not include a fiscal note, bill sponsor Assemblyman Edgar Flores (D-Las Vegas) and Andrew Clinger, chief financial officer for the Nevada System of Higher Education, clarified that in order to create an alternative form and process for undocumented students to apply for the grant, the Nevada System of Higher Education will draw up to 5 percent of the Silver State Opportunity Grant program funds, which total $5 million a year allocated from the state general fund. 

“That's why there's not a fiscal note on that piece, because with that language in there it gives us the resources to go ahead and implement that alternative FASFA,” Clinger said during a hearing before the Assembly Ways and Means Committee last Thursday. 

Clinger added that he was unsure whether the complete 5 percent, or $250,000 annual total, earmarked in the bill would be necessary to implement AB213.

“Obviously we want to get as much of those funds out to the students as possible so we will keep those administrative costs as low as we can,” he said. 

Flores, who also practices immigration law, added that the process of filling out the alternative form would ensure privacy protection for undocumented students. 

“It's very similar to the way you would go about filling out a passport, except that it would be our own revised new version of it and it would not be reported and it would not go out to the federal government. It would be locally handled within the jurisdictional boundaries of Nevada,” he said. 

Assemblywoman Maggie Carlton (D-Las Vegas), who chairs the Assembly Ways and Means Committee, expressed concern about the recurring cost the bill would mean for the grant program. 

“If it's an ongoing cost and we start scraping money off of tops of scholarships to get things done, then I think that's a bigger policy discussion for everyone to have,” she said. 

Along with removing the FAFSA requirement to apply for the Silver State Opportunity Grant, AB213 would also scrap the requirement that students sign an affidavit declaring themselves either citizens of the U.S., legal immigrants or to have filed for a legal immigrant status in order to apply for the Millennium Scholarship, which offers free or reduced tuition to Nevada colleges and universities. 

Heading off concerns about the value of extending the scholarship to undocumented students, Flores noted that undocumented students’ immigration status is likely to change through their time in higher education and said the state has a responsibility to support all students. 

“We have a vested interest in ensuring that our students who are graduating here, we've already invested X, Y and Z in ensuring that they go through our system of K-12. Now we have a vested interest in continuing to ensure that they graduate and can put all those benefits and resources and all those capabilities to work for our state,” Flores said. 

In addition to expanding access to the state grant for undocumented students, AB213 would also enshrine certain Nevada System of Higher Education practices in state law, such as guaranteeing that graduates from Nevada high schools receive in-state tuition and are eligible for the merit-based Millennium and last-dollar Nevada Promise scholarships. 

The measure also aims to ensure enrolled members of federally recognized tribes in Nevada are eligible for in-state tuition regardless of state residency status. 

The committee did not immediately vote on the bill, which still needs a vote from the full Assembly and Senate in order to be passed as state law before the Legislature ends on Monday.

Editor’s Note: This story first appeared in Behind the Bar, The Nevada Independent’s newsletter dedicated to comprehensive coverage of the 2021 Legislature. Sign up for the newsletter here.

Lawmakers review price tags of expanded mail voting, earlier presidential primary bills

With less than a week left in the session, lawmakers are finally moving to process three major election-related bills aimed at moving Nevada up the presidential primary calendar, permanently expanding mail voting and upgrading the state’s voter registration database.

The three bills were heard Tuesday morning during a meeting of the Assembly Ways and Means Committee, with Democratic lawmakers and progressive groups heralding the measures as ways that the state can make it easier to vote, but with Republicans questioning the proposed costs and benefits of several of the bills.

The trio of measures, all of which were presented by Assembly Speaker Jason Frierson (D-Las Vegas), all had hearings earlier in the session, but the hearings on Tuesday were meant to go over the potential budgetary effects They also signal that legislators are preparing to queue up the measures for floor votes and rapid processing through the final days of the session. After the initial morning hearings, members of the committee voted out all three of the bills late into the night on Tuesday.

Most of the opposition was focused on AB321, a bill seeking to permanently expand mail voting in the state and set in stone the temporary changes adopted ahead of the 2020 election. The bill would make Nevada the sixth state to adopt a largely mail voting system, though voters would be allowed to opt out of the system and vote in person if they choose.

Much of the hearing focused on disagreements over how much the bill would cost. Democratic lawmakers questioned a fiscal note submitted by the secretary of state’s office estimating implementation costs would run north of $5.2 million — Frierson said that price tag “simply doesn't necessarily reflect the reality” of election costs, as the 2020 election (a presidential election) only cost $3.9 million.

“I think there's a tendency for folks to look for the ideal, and say ‘well, since we're opening up anyway, let's find an ideal way to do all of this,’ which is not always necessary or practical,” he said.

Deputy Secretary of State for Elections Mark Wlaschin said that changes in election turnout between presidential election years and midterms wouldn’t have a significant impact on the cost of largely mail elections, as all 1.8 million registered voters in the state would be mailed a ballot unless they opted out. 

He said the office also planned to increase the number of ballot drop boxes from about 120 to around 220 (at a cost of $1,500 each), and said the agency did not fully reimburse counties for election costs in 2020 because they had access to federal CARES Act dollars and other funding sources.

Though Wlaschin said the bill could lead to potential cost savings as a larger percentage of the electorate casts votes by mail (lowering the number of in-person polling places needed), he said that would likely not happen over the current biennium and that the secretary of state’s office opposed the bill because of the “negative fiscal impact it would have on the state.”

Wlaschin said the office also believed that it would need around $660,000 to help with a marketing and education campaign on the proposed changes, but Frierson said the agency’s concerns over cost did not take into account potential cost savings from the bill and that other options existed for voter education.

“While we on a couple of occasions have talked about voter education, that clearly was not an issue for the secretary of state before now,” Frierson said. “And there are organizations in the community that do this for free, who would be more than willing to partner with the secretary of state at a significant decrease if not zero cost to do voter education in the community.”

Support and opposition on AB321 fell largely along expected lines — organizations including the Culinary Union, ACLU of Nevada, Battle Born Progress, AARP Nevada and Silver State Voices testified in support, while the Nevada Republican Party (which has run ads opposing the legislation), the Independent American Party and Nevada Right to Life opposed the measure.

The committee heard another potentially significant change to state election procedures in the form of AB126, which proposes that the state leapfrog New Hampshire and Iowa to move to first place in the presidential primary calendar. Frierson, the bill’s sponsor, also presented a conceptual amendment that removes language related to a change in candidate filing deadlines, but otherwise keeps the provisions of the bill in place.

“In conversations both with our local elected officials and with the courts … it would create problems outside of our state budget that outweighed the benefits, as we originally contemplated,” he said.

Wlaschin said the secretary of state’s office estimated that implementing a presidential primary election (as opposed to a party-managed caucus) would cost about $5.2 million per cycle. That fiscal note irked Assembly Ways and Means Committee Chair Maggie Carlton (D-Las Vegas), because the next presidential election in 2024 falls outside the current budget cycle.

“The question is, why would you submit a fiscal note on something that will not impact us in this biennium?” she said. “This Legislature, this committee, deals with the budget for this biennium only.”

Wlaschin said the bill would not have an effect on the current budget, “but there will be something later on down the line.”

The bill attracted support from progressive and Democrat-aligned groups, but drew opposition from the state Republican Party. Republican National Committee member Jim DeGraffenreid said the bill would be a waste of resources as states such as New Hampshire were fully prepared to move around their primary dates to keep their plum spot on the nominating calendar.

“New Hampshire has a state law that says they must hold the first primary in the nation, and they will hold their primary as early as necessary to remain first,” he said. “We have no ability to change the laws of the state of New Hampshire, and so this is a waste of our five and a half million dollars to chase that impossible goal.”

Still, Democrats said they were eager to advance the bill if only to get away from the presidential caucus system — Assembly Majority Leader Teresa Benitez-Thompson (D-Reno) said she wasn’t “offended” by the fiscal note and that it was time to “evolve” past the caucus process.

“If we make the process easier to engage in, people will engage,” she said. “We have an electorate that cares, we have an electorate that wants to show up, and all we have to do is remove barriers, and they will engage in a way that our founders absolutely dreamed of.”

Members of the committee also reviewed AB422, a bill that would gradually shift Nevada from a county-led, bottom-up voter registration system to a state-led, top-down system. Frierson said that such a system would make the state’s voter registration system much more efficient and called the bill a “step in the right direction to streamline our state government.”

“Everyone who has been involved with elections has indicated an interest in moving us to a top-down system,” he said. The secretary of state’s office originally submitted a $9.2 million fiscal note on the bill, but Wlaschin said the office intended to use $4.8 million from Nevada’s share of grant funds from the Help America Vote Act and said the measure would not have a financial impact on the state for the upcoming budget cycle.

Updated at 9:45 p.m. to update that all three bills passed out of committee on Tuesday evening.

Lawmakers consider proposal to suspend business licenses over unpaid debt

Lawmakers frustrated with the state’s slow collection of unpaid debt want to start suspending business licenses of entities that owe money to the state.

The bill to do that, AB482, was heard in the Assembly Ways and Means Committee on Tuesday and would require the secretary of state’s office to not renew a business licenses if they are informed by the state controller’s office that the business in question has an outstanding debt owed to a state agency that is currently in collections with the controller’s office. 

It’s intended to capture fees and fines most commonly related to OSHA violations or worker’s compensation premiums, but would include any kind of debt to the state that’s been referred to the controller’s office.

“We don't want to necessarily put people out of business,” Assembly Ways and Means Chair Maggie Carlton said during the hearing. “We just want them to fulfill their responsibility in paying their fines.”

But there was one small problem — the agency charged with enforcing provisions of the bill, the secretary of state’s office, said the bill had come as a “surprise” and the office still had outstanding questions about how the legislation would work.

Deputy Secretary of State for Commercial Recordings Kim Perondi told the committee that the office had liability concerns about potentially suspending a business license as opposed to placing a business on an administrative hold, or if it could lead to corporations being unable to operate because of a single individual’s debt owed to the state.

“While overall the secretary absolutely supports the concept of preventing debt write off and preventing those owing money to the state from continuing to profit from state contracts and such, we will be testifying in neutral on this bill because of the way it's drafted,” she said.

Perondi said the office would continue to work with supporters on the bill, who said it would add more teeth to existing state law on debt collection.

Rusty McAllister, head of the Nevada State AFL-CIO and appointed member of the state’s Industrial Relations Division advisory board, said the legislation came from a general frustration between the division and state Controller’s Office (which handles debt collection) over businesses opting to refuse to pay or decline to pay any fines or fees owed as workers’ compensation premiums and OSHA violations.

McAllister said the division currently has more than $20 million in uncollected fees and fines, and regularly shifts off accumulated debt as “uncollectible” even as businesses continue to operate in the state. He said most fines are within the $500 to $1,000 range, but some continue to accrue to the tens of thousands of dollars range.

“Every time that we're asked to write off this debt and send it to the Board of Examiners as a write-off, this is money that the state could use,” he said. “And at the same time, we're tired of seeing these businesses stay in business, doing business here in the state with no ramifications.

Editor’s Note: This story first appeared in Behind the Bar, The Nevada Independent’s newsletter dedicated to comprehensive coverage of the 2021 Legislature. Sign up for the newsletter here.

$2 million price tag divides correctional officials and lawmakers over bill enrolling released prisoners in Medicaid

Guards walk inside High Desert State Prison as seen on Friday, Jan. 4, 2019.

Lawmakers and correctional officials ended up at odds last week over a fiscal note attached to a measure aimed at enrolling soon-to-be released prisoners in the state Medicaid program.

AB358, sponsored by Assembly Speaker Jason Frierson (D-Las Vegas), would in theory help alleviate medical expenses that the Nevada Department of Corrections currently covers with general fund dollars by signing up eligible members for Medicaid before release, Assemblywoman Rochelle Nguyen said as she presented the bill Tuesday during an Assembly Ways and Means Committee meeting. 

"Instead of us paying for 30 days cash of people's medical [expenses], they would be covered under Medicaid," Nguyen said. "It would also help with the continuity of care because they would be set up, they would have providers that we would be able to work with ... and have that kind of continuity of care that is required for them to be successful once they are released."

But a fiscal note submitted by the Department of Corrections that estimated the program's cost as close to $2 million over the next two years ground the discussion to a halt. 

NDOC Statewide Reentry Administrator Elizabeth Dixon-Coleman said that the state releases about 6,000 prison inmates annually, and that the state prison system needed the money to pay for increased personnel, operating systems and equipment expenses necessary to establish a program that will process roughly 460 Medicaid applications a month.

"We do not have an electronic processing component to this. We don't have the infrastructure nor the supporting abilities to do this," Dixon-Coleman said.

Budget committee Chair Maggie Carlton (D-Las Vegas) pushed back against the addition of the fiscal note, saying the state’s existing Medicaid program should be able to address any cost concerns.

"Medicaid does eligibility. That is their life. That is what they do. It seems to me as though we're recreating the wheel here in creating program officers to do eligibility when Medicaid currently does eligibility," Carlton said. "Is there a way within the Medicaid regime to allow these inmates to access that in a safe and secure way ... and take NDOC out of the middle for a portion of this and have Medicaid do the thing that they do so well?"

The NDOC and Division of Welfare and Supportive Services have created a pilot project to test out the eligibility process, division chief of programs operations Joe Garcia told the committee. Though the division has considered shortening the roughly 20-page paper application and has a call center that can take applications over the phone, there could be security issues with inmates applying for Medicaid over the phone, he said.

Frierson said similar programs without attached costs exist, including at the Clark County Detention Center. He added that inmates have to speak with their attorneys via phones, and that does not violate confidentiality laws.

"There are phones. It's not like they're sending homing pigeons out. They have to be able to talk to their attorneys, and they have to be able to do it in private," Frierson said. "This would seem to me to be an opportunity to defray costs of medical expenses as folks are transitioning out. And I'm just a little surprised at the reluctance, especially recognizing that there have been efforts to address this for some time now."

Though Dixon-Coleman cited concerns about HIPPA and security issues, Carlton said that she would have more worries around paper documentation and security than a phone call. Officials with the NDOC need to investigate other options and take Frierson's comment about a secure line and confidentiality to heart, she added.

"There's a little bit more work to be done on this. We'll follow up with the appropriate folks and see where we can go. And I'm sure you'll follow up with them also," Carlton said.

Editor’s Note: This story first appeared in Behind the Bar, The Nevada Independent’s newsletter dedicated to comprehensive coverage of the 2021 Legislature. Sign up for the newsletter here.

Budget subcommittee votes to roll back Medicaid rate decreases approved during summer special session

Lawmakers on a budget subcommittee voted Wednesday to recommend rolling back a 6 percent Medicaid rate decrease, approved by the Legislature during a budget-slashing special session last summer, in a major victory for Nevada’s health care providers who had pilloried the reductions.

The subcommittee also voted to finally enact a 2.5 percent increase to the acute care hospital rate, which was approved by lawmakers in 2019 and then axed during the summer special session. While that rate increase won’t take effect retroactively, the goal will be for it to kick in on July 1.

While Gov. Steve Sisolak had proposed in his executive budget restoring the 6 percent Medicaid rate decrease starting Oct. 1, the Governor’s Finance Office submitted a budget amendment over the weekend to entirely undo the Medicaid budget reductions approved last summer.

The move will restore about $300 million in Medicaid funding both in the current fiscal year and in the upcoming biennium, including about $110 million in general fund spending.

The budget cut restorations come just a little more than a week after economic forecasters projected that Nevada’s general fund revenue is projected to be more than $910 million more than what they had predicted in December. That includes a $590 million revision in the upcoming biennium and $320 million in the current fiscal year.

“We had the conversation in the special session. We realized what we had to do at that moment in time. We also made the commitment that as soon as we could fix this we would, and we as a body are honoring that commitment today,” said Assembly Ways and Means Chair Maggie Carlton. “We could have gone through this and picked and chose who we wanted to, especially in the fiscal situation that we are in right now, but we made the commitment that we would move forward on this when it was possible, and thank goodness we're able to do it today.”

Sisolak, in a statement on Wednesday, said the legislatively approved Medicaid cuts “no longer appear necessary to deal with a severe budget shortfall.” Lawmakers cut nearly a billion dollars from the state’s budget last summer.

“Medical providers have been on the front lines of the pandemic for more than a year, enduring untold stress, both financial and emotional,” Sisolak said. “Restoring provider reimbursement rate cuts will help these small businesses and hospitals that have done so much to keep hard-working Nevadans healthy during this pandemic.”

Several health care lobbyists called in to thank lawmakers for restoring the cuts during the public comment portion at the end of the budget hearing, and the Nevada Hospital Association and the Nevada State Medical Association sent a joint letter to Sisolak thanking him as well.

“Nevada faced an unprecedented state budget crisis,” Bill Welch, the hospital association’s president, and Jaron Hildebrand, the medical association’s executive director, said in the letter. “The work you did alongside the Nevada Legislature to restore funding to hospitals and providers will be instrumental in safeguarding the health care available to many Nevadans.”

Because the federal Centers for Medicare and Medicaid Services, which oversees state Medicaid programs, had yet to approve most of the rate decreases, the state is expected to simply withdraw its request to reduce the rates — in the form of what’s known as a state plan amendment — leaving Medicaid almost as if the cuts never happened.

The state had, however, already started to reduce the amount it was paying managed care organizations to provide health insurance to Medicaid recipients starting Jan. 1 in anticipation of the rate cuts being approved. It plans to boost payments to insurance companies retroactively.

Of the state’s three managed care organizations, only one had started to pass the rate reductions along to health care providers, and lawmakers emphasized on Wednesday that they expect that company, which was not named during the hearing, to pass the boosted payments along to providers as well.

“What we'll be doing here is those who haven't taken cuts will not have to take cuts. Those who have taken cuts, we're going to make the managed care organization whole, and then hope that the managed care organization will make the providers whole,” state Sen. Julia Ratti said during the hearing.

The budget subcommittee also approved a number of other adjustments to Medicaid’s budget on Wednesday, including significant caseload adjustments that will cost the state roughly $320 million in general fund dollars. The governor’s recommended budget had counted on a caseload of about 770,000 in each year of the biennium, now expected to be about 830,000 in fiscal year 2022 and 820,000 in fiscal year 2023.

They have, however, managed to find some additional savings elsewhere, including by budgeting for an enhanced federal matching rate to exist through the end of the year, a move that is expected to save the state about $40 million in general fund dollars.

The subcommittee also voted to approve the 6 percent rate reduction restoration the governor had initially recommended starting Oct. 1, at a cost of about $130 million over the biennium.

Editor’s Note: This story appears in Behind the Bar, The Nevada Independent’s newsletter dedicated to comprehensive coverage of the 2021 Legislature. Sign up for the newsletter here.