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Minutes of the Meeting of the |
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Committee on Industrial Programs |
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(NRS 209.4817) |
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A meeting of the Interim Finance Committee’s Committee
on Industrial Programs was called to order by Chairman Marvel at |
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COMMITTEE
MEMBERS PRESENT IN
Assemblyman John Marvel
Senator Maurice Washington
Greg Smith, Administrator, Purchasing Division
COMMITTEE
MEMBERS PRESENT IN
Senator Raymond Rawson
Assemblyman Morse Arberry,
Jr.
Bruce Aguilera, Vice President/General Counsel, Bellagio
Jackie Crawford, Director,
Department of Corrections
Mike Magnani, Labor Union Representative
COMMITTEE MEMBERS ABSENT:
Al Puliz, Chairman, Puliz
Moving and Storage
LEGISLATIVE
COUNSEL BUREAU STAFF PRESENT:
Leslie Johnstone, Program
Analyst, Fiscal Analysis Division
Mark Krmpotic, Senior Program
Analyst, Fiscal Analysis Division
Yvonne Goodson, Deputy
Legislative Counsel, Legal Division
Denise Larsen, Secretary,
Fiscal Analysis Division
OTHERS
PRESENT:
Shane
Chesney, Deputy Attorney General
John McCuin, Chief of
Financial Services for Prison Industries
Deborah L. Reed, Budget
Division, Department of Administration
EXHIBITS:
Exhibit A: Meeting Notice and Agenda
Exhibit B: Attendance Record
Exhibit C: Copy
of the
Because
of their size, the exhibits are not attached to these minutes; however, upon
request, may be reviewed in the Fiscal Analysis Division of the Legislative
Counsel Bureau,
I. CALL TO ORDER AND OPENING REMARKS BY ASSEMBLYMAN MARVEL.
Chairman Marvel called the meeting
of the Interim Finance Committee’s Committee on Industrial Programs to order at
II. APPROVAL OF THE MINUTES OF THE
Chairman Marvel questioned whether
members had any additions or corrections to the minutes of the
SENATOR
GREG SMITH SECONDED
THE MOTION.
THE MOTION PASSED
UNANIMOUSLY.
Chairman Marvel requested
that
III. DISCUSSION
OF POTENTIAL INDUSTRY PROGRAMS AND COMMITTEE RECOMMENDATIONS (NRS 209.4818):
A. Gambler's Store (RT Plastics) –
Mr. Skolnik advised the
Committee that the Gambler's Store (RT Plastics), a company that manufactures
poker chips, owns the largest gambling supply store in
Chairman Marvel asked whether
Committee members had any questions regarding the industrial program for the
Gambler's Store. Hearing none, he called
for a motion to approve the new industrial program.
SENATOR
DIRECTOR CRAWFORD SECONDED
THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
B. Thomson Equipment Company – Southern Desert Correctional Center
Mr. Skolnik informed
the Committee that ITSAR had left the facility at Southern Desert Correctional
Center (SDCC). Thomson
Equipment Company, a previous customer of ITSAR, had approached Prison Industries to
establish an industrial program that would refurbish water trucks. He explained that the tanks for the water
trucks were being made in
Mr. Skolnik advised the
Committee that Thomson Equipment Company indicated that
they had orders for over 300 trucks in the upcoming year. He noted that the industrial program would
employ approximately 40 to 50 inmates at minimum wage.
Mr. Skolnik informed the
Committee that certification for the replacement industrial program under the
Prison Industry Enhancement Certification Program (PIECP) could be obtained
with a simple name change.
Mr. Skolnik advised the
Committee that there was a potential for additional industrial
programs due
to Thomson Equipment Company's ties to
Chairman Marvel questioned
whether Prison Industries required the Committee's approval for the Thomson Equipment Company since it was a
replacement industrial program and whether the program would employ
additional inmates. He further questioned if Shane
Chesney, Deputy Attorney General, had an opportunity to review the contract.
With regard to Chairman
Marvel’s question on the approval, Mr. Skolnik affirmed he was asking for
formal approval from the Committee for the Thomson Equipment Company as a replacement industrial program. He indicated that the contract was the same as
the contract for ITSAR and that Thomson
Equipment Company would employ the same number of inmates for the
renovation of semi-trucks. He noted that Thomson Equipment Company was based in
In reference to Chairman
Marvel’s question regarding the review of the new contract, Mr. Chesney
indicated he had reviewed and approved of the contract with Thomson Equipment Company.
Responding to a question
from Chairman Marvel regarding the temporary occupancy certificate for the
building at SDCC and the fire‑watch stipulation
while manufacturing, Mr. Skolnik indicated these issues had been resolved with
the Fire Marshall.
Chairman Marvel called for
further questions on Thomson Equipment
Company. Hearing none, he called for a
motion to approve the replacement company as an industrial program.
BRUCE AGUILERA MOVED FOR
APPROVAL FOR THE PURSUIT OF THE Thomson
Equipment Company AS A
PRISON INDUSTRIAL PROGRAM AT SOUTHERN DESERT CORRECTIONAL CENTER.
MICHAEL Mackenzie SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
C. TREX (Polysort) – Lovelock Correctional Center
Mr. Skolnik informed
the Committee that TREX (Polysort),
a company with an industrial program located in the
Mr. Skolnik advised
the Committee that the industrial program for sorting plastics could be located
in the 10,000 square-foot area vacated by the
Chairman
Marvel asked if Committee members had further questions on the potential
program with TREX.
Mike Magnani, Labor Union
Representative, questioned whether the program would displace any
Mr. Skolnik answered that the
TREX industrial program would not replace
Responding to Chairman
Marvel's question regarding the use of the recycled plastic, Mr. Skolnik
advised that the Fallon operation utilized the sorted plastic to manufacture
two‑by-fours and other products, such as those used on playgrounds.
Chairman Marvel asked if
Committee members had further questions of Mr. Skolnik on the TREX Industrial Program. Hearing none, he called for a motion on the
pursuit of the potential industrial program.
SENATOR
GREG SMiTH SECONDED THE MOTION; AND IT PASSED
UNANIMOUSLY.
D. ADCOR –
Mr. Skolnik
informed the Committee that Prison Industries had been contacted by both of the
major contractors of concrete castings in the
The other
company, ADCOR, was a new company that was working with established companies
to manufacture concrete castings. ADCOR would
construct a temporary building at High
Desert State Prison (HDSP) and would employ approximately 24 inmates
when fully operational to manufacture the concrete castings. Mr. Skolnik advised that ADCOR had indicated
they would hire inmates employed in the industrial
program upon their release if the industrial program was successful.
Chairman Marvel asked
whether there were further questions or discussion on ADCOR as a potential
industrial program. Hearing none, he called
for a motion on ADCOR as a potential industrial program.
SENATOR
GREG SMiTH SECONDED THE MOTION.
THE MOTION PASSED UNANIMOUSLY.
Chairman Marvel questioned
whether there was further discussion under agenda item III.
Mr. Skolnik informed the
Committee that Prison Industries was communicating with another company for an
industrial program at HDSP that would be discussed under agenda item V. He noted that Prison Industries was involved with a
Chairman Marvel directed
the Committee to proceed to item IV on the agenda.
IV. STATUS REPORT FROM PRISON
INDUSTRIES AND COMMITTEE RECOMMENDATIONS REGARDING THE FOLLOWING PROPOSALS AND
PRISON INDUSTRY ENCHANCEMENT CERTIFICATON PROGRAM (PIECP).
A. ITSAR Truck Program – Southern Desert Correctional Center
Mr. Skolnik informed
the Committee that ITSAR, the industrial program for the renovation of
semi-trucks, had left Prison Industries at SDCC and returned to
B. Garment Factory – Lovelock Correctional Center
Mr. Skolnik informed the
Committee that the Garment Factory at Lovelock Correctional Center (LCC) was moving
at slow progression. The industrial
program presently employs 66 inmates. He
said that due to the inmates' efficiency, inmates are able to produce the Nevada
Department of Correction's (NDOC) annual requirements in three to four
months.
Mr. Skolnik
advised the Committee that the State of
Chairman Marvel questioned
whether Prison Industries had considered Mr. Smith's offer of the state's
warehouse located in
With regard
to Chairman Marvel's question on the warehouse, Mr. Skolnik indicated that
Prison Industries did not require the storage at this time; however, Prison
Industries may want to utilize the storage should they decide to purchase
textiles from the company they were dealing with in
Mr. Skolnik discussed differences in
structure of the prison industries in the state of
With regard to Chairman Marvel's
concern for a similar ruling being issued by
Both Mr. Chesney, and Yvonne
Goodson, Deputy Legislative Counsel, Legal Division, concurred with Mr. Skolnik
regarding the constitutional language concerning
Responding to Chairman
Marvel’s question regarding the profitability of the Garment Factory at LCC, Mr. Skolnik
indicated that the operation was profitable; however, it was not running at the
capacity that it should be operating.
Answering Chairman Marvel’s question regarding Mr. Boxer, Mr.
Skolnik advised that Prison Industries was producing a new denim product called
“Hard Timin'” that would be featured by Mr. Boxer if and when the store's planned
expansion to a secondary site transpired.
In response to Chairman
Marvel’s question on the number of inmates employed at LCC, Mr. Skolnik
answered there were 66 inmates employed in the Garment Industrial Program and
22 inmates employed with Somerset Industries, Inc.
Chairman Marvel requested
that Mr. Skolnik continue with agenda item IV.
C. BLM Wild Horse Program –
Mr. Skolnik apprised the Committee that Prison
Industries’ Wild Horse Program for the Bureau of Land Management (BLM) was
housing approximately 500 to 550 wild horses.
He related that the expansion of the program and building new corrals
had been put on hold due to BLM's funding issues.
Indicating that the Wild Horse Program was profitable
for Prison Industries, Mr. Skolnik noted that at the last horse auction,
100 percent of the horses were successfully adopted.
Responding to a question from Chairman Marvel
concerning the operation for the horses at the Warm Springs Correctional Center
(WSCC), Mr. Skolnik indicated that the majority of horses at WSCC were
being held at the facility until the horses could be released back to their
originating range once the drought ended and the land could again support
them. He reported that Prison Industries
had an unusual success rate with those horses that were selected for gentling or
adoption at auction. Additionally, Mr.
Skolnik reported that many horses that were adopted were brought back to Prison
Industries for gentling purposes.
D. Jacobs Trading Company –
Mr. Skolnik advised the
Committee that Jacobs Trading Company was operating at the same level. He related that Jacobs Trading Company had approached
Prison Industries with a request for the
construction of a new building. Mr. Skolnik
added that it was Prison Industries
decision to wait on further construction until they have completed the building
for Alwire Cable; therefore, Jacobs Trading Company would be held at its current level
for a few more months.
E. Alwire Cable –
Mr. Skolnik advised the
Committee that the contract for Alwire Cable had been signed and approved regarding its new building. He further advised that Alwire Cable had
hired an engineering firm for the proposed building at the Southern Nevada Women’s Correctional Facility (SNWCF). Alwire Cable's representatives and the warden would
be meeting with representatives from
Responding to Chairman
Marvel’s question regarding the overall cost of the proposed building for Alwire
Cable at SNWCF, Mr. Skolnik indicated that cost estimates with the engineering
and architect fees run from $350,000 to $500,000 for the finished package. He explained that Prison Industries would
purchase the building back from
With regard to Chairman
Marvel's question concerning the length of the contract, Mr. Skolnik indicated
that the Alwire Cable contract was good for five years with two renewable
five-year options. He explained that
should Alwire Cable opt out, the new tenant of the building would take over the
rent payment to Alwire Cable until the building was paid off. Should a new tenant not be found immediately,
the state would not be responsible for the payment.
Answering Chairman Marvel’s
question regarding the amount of funds that would remain in the Prison
Industries’ Capital Projects account as
a result of the agreement with Allwire Cable, Mr. Skolnik advised costs for the building would
deplete the majority of the account. He
added the account would quickly build back up with an increase in inmate
employment.
Chairman Marvel questioned whether John McCuin, Chief of Financial Services for Prison Industries,
could provide the Committee with an amortization of payments on the proposed
building for Alwire
Cable.
Mr. McCuin introduced himself for the record and
indicated that although he did not have it with him, he had completed an
amortization schedule for the payments.
He advised the Committee that it would take approximately ten years to
repay the total cost of the building. Mr. McCuin
reiterated Mr. Skolnik's
statement that payments for the building would cease until a new tenant could be found, should Alwire Cable opt out of
the contract.
In response to Chairman
Marvel’s question regarding review of the contract, Mr. Chesney affirmed that
he had reviewed the contract for Alwire Cable.
Chairman Marvel expressed
concern regarding the building for Alwire Cable exhausting the majority of
funds in the Prison Industries’ Capital Projects account
should another project present itself.
Addressing
Chairman Marvel's
concern, Mr. Skolnik related that with the expansion of Prison Industries'
programs and more inmates employed, funds would build back up in the account. He advised the Committee that the Board of
Examiners had approved the contract with Alwire Cable. Mr. Skolnik indicated that the purpose of
the Capital Improvement account was to expand Prison Industries' programs and
that the Alwire Cable building was consistent with that intent. He added that space for more industrial
programs was limited until the Industrial Park at Indian Springs becomes
available. He confirmed that the plan
for the Industrial Park is to have the private sector complete the
construction.
Chairman Marvel asked whether
Committee members had any questions regarding the
F.
Mr. Skolnik informed the Committee that Prison
Industries had purchased the land and zoning had been approved for the proposed
In response to Chairman
Marvel’s question regarding the RFP, Mr. Skolnik explained that Prison
Industries worked through the Nevada State
Purchasing Division, utilizing its expertise in developing proposals for projects
such as the Industrial Park and the Cook/Chill Program.
Greg Smith, Administrator,
Purchasing Division, indicated that Kimberee Tarter had been working with
Prison Industries on the RFP. He noted
that the State Purchasing Division tries to work as a facilitator for such
projects.
Regarding Chairman Marvel’s question regarding the number
of companies who have expressed interest in the proposed Industrial Park, Mr.
Skolnik reported that three or four companies requested that Prison Industries
forward the RFP to them.
For the record, Mr. Skolnik expressed his gratitude
for being able to work with Kimberee Tarter from the State Purchasing Division. He indicated that Ms. Tarter was very
professional and that working with her
had been a
pleasant experience. Mr. Skolnik requested that Mr. Smith extend his thanks to
Ms. Tarter for her assistance.
With regard to Chairman
Marvel’s question regarding the number of businesses that the Industrial Park
could accommodate, Mr. Skolnik advised that the area contained approximately 600,000 square feet of manufacturing space. He indicated that, depending on the
developer, there could be one huge enterprise or many small companies. Mr. Skolnik speculated that the space would be
developed in 2,000 to 3,000 square-foot increments.
Addressing
Chairman Marvel's
question regarding the RFP, Mr. Smith indicated that Ms. Tarter planed to meet
with Mr. Skolnik to review and finalize the RFP, which
should be out by the end of September 2004.
Chairman Marvel requested
that the Committee be kept informed on the progression of the RFP and the
Industrial Park. He asked if the
Committee members had further questions or comments concerning the Industrial
Park.
Hearing none, he requested Mr. Skolnik discuss agenda item IV G.
G. Cook/Chill Process –
Mr. Skolnik informed the Committee that a
Request for Qualifications (RFQ) resulted in two companies that qualified for
the Cook/Chill program. He explained
that variations in the bids submitted by the companies proved difficult to
compare the bids; therefore, additional questions on the programs will be
required from the vendors. Prison
Industries intended to request further information regarding the menus,
culinary, and components of the training academy for both vendors. Mr. Skolnik advised the Committee that from
the initial submission of the bids, it looked as if the Cook/Chill Program
would work and be cost effective with either of the two vendors providing all
the capitalization.
Responding to Chairman
Marvel’s question concerning the time frame of Prison Industries' additional questions and the vendors' responses, Mr. Skolnik
advised that Prison Industries hoped to
have the written replies from the vendors by the end of October 2004.
Responding to Chairman
Marvel’s question regarding the transportation of the product of the Cook/Chill
process, Mr. Skolnik indicated that the transportation was subject to the final
bid proposal. He further explained that
if Prison Industries provided the transportation, the vendor would be required
to pay Prison Industries to ship the product; whereas, if the vendor provided
the shipping, the vendor would be paid for transportation costs.
With regards to Chairman
Marvel's question concerning whether HDSP could accommodate the entire
Cook/Chill Program, or whether a satellite facility such as LCC would be
necessary, Mr. Skolnik explained that the processing could be all done at HDSP. He added that both proposals indicated it
would be beneficial to have a kitchen in both the northern and southern areas. He advised the Committee that projections of
capitalization costs and savings on transportation would determine whether or
not there would be a satellite facility.
Should a second facility be utilized for the Cook/Chill Program, it
would be located at the Northern Nevada Correctional Center (NNCC) in
Jackie Crawford, Director,
Department of Corrections (NDOC), related that although she was not an expert
in the Cook/Chill
process, she
was concerned that the kitchen facility at NNCC would require upgrades prior to
accommodating the Cook/Chill program. It was Director
Crawford's opinion that retro-fitting the kitchen would be necessary, as NNCC
had already requested expansion and upgrades for its kitchen
Mr. Skolnik concurred with Director
Crawford's opinion, noting that the vendors included retro-fitting NNCC's
kitchen as part of their proposal for Cook/Chill. He
added that he was unsure if vendors were proposing a full kitchen or a
satellite kitchen that would accommodate taking bulk prepared foods and
subsequently preparing them into individual meals.
Responding to Chairman
Marvel's question concerning the shelf life of the Cook/Chill products, Mr. Skolnik related that the
shelf life was approximately five days to three weeks. The Cook/Chill process had two components: the bulk processing that results in a 45-day
food shelf life and the hot plate process that results a 5-day shelf life. He speculated that due to storage capability,
Prison Industries would probably not store the product more that five
days. Mr. Skolnik advised the Committee
that the majority of the expense for the program would be in building required
cooler space. He further advised that
since freezer space would not be needed to store raw food, much of that freezer
space could be converted to refrigerator space to store completed food. Mr. Skolnik advised that the required capital
improvement issues and the amortization of their costs would be the
responsibilities of the vendor in their bid.
He expounded, saying that Prison Industries had made it clear to vendors
that they would not subsidize, nor would the state expend money for the capital
development or costs
for conversions for the Cook/Chill project.
Chairman Marvel requested Mr. McCuin's opinion of the
project.
Responding to Chairman Marvel's request,
Mr. McCuin
related that during the vendor's presentations for the Cook/Chill project, he was impressed with
both companies. He confirmed that both
vendors had specified HDSP as one kitchen and NNCC as the other kitchen. Mr. McCuin informed the Committee that he had specifically asked each
vendor if NNCC's kitchen would be adequate without major modifications, and
each vendor had affirmed it was. He advised
that each vendor knew they would be responsible for any retro-fitting to
kitchen facilities.
Mr. Smith added that Ms.
Tarter was working with Mr. Skolnik regarding all of the aforementioned issues
for the Cook-Chill
Program.
Director Crawford suggested
that Prison Industries consult with state officials while preparing further
questions for vendors to ensure facilities adhere to all health code
requirements.
With regard to Director Crawford's
suggestion, Mr.
Skolnik related that at the time of actual capital change, the vendor would
have to adhere to any health or safety or fire codes.
Director Crawford related
that the Capital Improvement program through NDOC had informed her that
upgrades are required at NNCC in order to meet health codes. Director Crawford reiterated
that she wanted to ensure that any changes would stay within the required code.
Responding to Chairman
Marvel’s question regarding the time frame for an actual contract regarding the
Cook/Chill process, Mr. Skolnik could not be sure about the time frame;
however, he speculated that negotiations for the contract could be completed as
soon as November 2004. With regard to
and potential savings should the Cook/Chill process be establish for NDOC, Mr.
Skolnik indicated the project looked promising and would be cost effective for
the state. He added that the Cook/Chill
Program would also be a substantial business for Prison Industries.
Chairman Marvel asked if
Committee members had further questions or comments on the Cook/Chill
process. There being none, he directed
the Committee to agenda item V.
V. STATUS REPORT REGARDING
CONSTRUCTION PROJECT AT
Mr. Skolnik informed the
Committee that construction was ahead of schedule for the building for HDSP and
it was nearly completed. He indicated
that Prison Industries had received tentative commitments from interested
companies for use of the 50,000 square-foot area, which could result in the
employment of approximately 200 to 250 inmates at HDSP.
Addressing Chairman
Marvel’s questions regarding specific companies who had expressed interest in
HDSP, Mr. Skolnik advised that Thomson Equipment was interested in utilizing
20,000 square feet of the area for mining equipment. He further advised that ADCOR, the concrete
casting company, had expressed interest in expansion in addition to the 12,000 square-foot
temporary space they presently occupied.
Mr. Skolnik added that there was interest in a 10,000 square-foot space
from a company in
Responding to Chairman Marvel’s question regarding the completion date
for HDSP's building, Mr. Skolnik said the construction of the building should
be completed by the end of September 2004 and the building could be occupied by
the end of 2004.
Chairman Marvel asked for
further questions regarding the construction project at HDSP. Hearing none, he directed the Committee to
the next item.
VI. REPORT REGARDING CONTRACT
WITH TREVI MANUFACTURING CORPORATION APPROVED BY THE STATE BOARD OF EXAMINERS
ON AUGUST 17, 2004 – JEAN CONSERVATION CAMP.
Mr. Skolnik advised the
Committee that the Board of Examiners had approved a contract for Trevi
Manufacturing Corporation for a community-work program with Prison Industries. He pointed out that this was the first
community-work program overseen by Prison Industries. Mr. Skolnik noted that Trevi
Manufacturing Corporation had contracted with a private company to transport
five inmates daily from the Jean facility to the community-work program in the
Addressing Chairman Marvel's
question regarding the contract for Trevi Manufacturing Corporation, Mr. Skolnik
affirmed the contract had been approved and was implemented on
Responding to Chairman
Marvel's question concerning the review of the contract for Trevi Manufacturing
Corporation, Mr. Chesney stated that he reviewed the contract.
Chairman Marvel asked if Committee members had
further questions on any of the industrial programs under agenda item IV. Hearing none, he directed the Committee to
the next agenda item.
Mr. Skolnik informed the Committee that he had
recently met with representatives from Tiberi Fence Company regarding utilizing
Prison Industries to produce horse panels as a potential industrial program.
VII. REVIEW OF FINANCIAL STATEMENTS
FOR QUARTER ENDING
Directing the Committee's
attention to Silver State Industries' Financial Statements beginning on page 36
under tab VII of the meeting packet, Exhibit C, Mr. McCuin noted that
the charts provided by Leslie Johnstone, Program Analyst for the Fiscal
Analysis Division, best depicted the individual shops. He pointed out that page 44 under tab VII of
the meeting packet, Exhibit C, illustrated the best indication of operational
statements by budget accounts. Calling
attention to Budget Account, P I Capital Projects, Mr. McCuin explained the
account was normally all revenue and no expenses. He said that the overall financial statement
indicated that Prison Industries had lost $9,000. Mr. McCuin pointed out that Budget Account 3727
had increased due to revenue from the Wild Horse Program and Budget Account 3719 was showing loss; however, it was less
of a loss than a year ago.
Responding to Chairman
Marvel's question regarding the Overhead Expense, Mr. McCuin replied that
the Overhead Expense primarily consisted of institutional salaries such as shop
supervisors, correctional officers, and administrative staff.
Chairman Marvel questioned whether
Mr. Mackenzie affirmed that
he had reviewed the financial statements and noted that two operations (the
Furniture and Auto Upholstery Shops) continue to have a negative financial impact
on Prison Industries. Mr. Mackenzie
advised the Committee that he had begun to work with the Auto Upholstery Shop to
improve the layout and process flow of material in order to improve
quality. He added that he was developing
a training program with outside, certified trainers to teach the auto
mechanics, technicians and painters with the intention that they obtain
certification and improve their work quality.
Mr. Mackenzie also recommended the development of a separate website for
the Auto Shop to increase the volume of work.
Chairman Marvel expressed
his gratitude to Mr. Mackenzie for the time he spent on improving the Prison
Industries’ operations for the state of
Concluding his review, Mr.
McCuin asked if Committee members had further questions regarding the financial
statements.
Noting that the financial
statements depicted information ending
Mr. Skolnik replied that
the final statements for the fiscal year would reflect similar financial indications. He noted that due to an upcoming audit with
an outside auditing firm for the purpose of American Correctional Association
(ACA) accreditation, the financial statements would be delayed. Mr. Skolnik said that initial figures
indicated that Prison Industries would break even in the fourth quarter. He speculated that Mr. Mackenzie's
recommendations and work for the Auto Shop would be transferable and could be used
to improve the Furniture Shop.
In response to Chairman
Marvel's question whether the Furniture Shop was competitive; Mr. Skolnik opined
the shop could even be under priced. He
indicated Prison Industries did not manufacture nor compete with low-end
furniture; however, they made quality products.
Chairman Marvel questioned
if the timeliness had improved regarding the previous problem that Prison
Industries had with purchase orders accumulating and not being processed
appropriately. He also questioned how
long it took for Prison Industries to fill an order.
Indicating that recently
orders had been current, Mr. Skolnik replied that a standard order could be
filled within two to three weeks, while custom orders could take six to eight
weeks. He added that due to backorders,
autos could take six to eight months.
Addressing Prison
Industries' competitive pricing on products, Mr. Smith advised the Committee
that he had purchased a new mattress set for approximately $1,000 locally and
later purchased a comparative mattress from Prison Industries for approximately
$300. Aside from the issue of delivery,
he said that quality of the beds were comparable.
In response to Senator
Washington's question regarding how Prison Industries accomplished marketing its
products, Mr. Skolnik explained that Prison Industries had a website, a CD
catalog and two marketing coordinators (one for each the northern and southern
part of Nevada). He added that promotions
for Prison Industries were done by local media, occasional shows, public
speaking and involvement with the Chamber of Commerce. Mr. Skolnik requested Mr. McCuin to send
one of Prison Industries' CD catalogs to Senator
Mr. Smith advised the
Committee that Mr. John Woodburn, Marketing Coordinator for Prison Industries,
was scheduled to meet with the Purchasing Division buyers to review Prison
Industries' products and costs in order to make customers aware of Industries'
products.
Chairman
Marvel called
for further questions or comments on the financial statements for Prison
Industries. Hearing none, he directed
the Committee to the next agenda item. Chairman
Marvel reiterated his appreciation to Mr. Mackenzie for his efforts in
helping to improve Prison Industries’ operations.
VIII. REVIEW OF NUMBER OF INMATES
EMPLOYED JULY 2002 THROUGH JUNE 2004.
Mr.
Skolnik directed
the Committee to page 59 under tab VIII of the meeting packet, Exhibit C,
and pointed out that there had been a reduction in the number of inmates employed
since May 2004; however, inmate employment had increased from the previous
year. He explained that employment
figures for August 2004 indicated another substantial decrease with the closing
of ITSAR. He said that with the addition
of ADCOR, Trevi Manufacturing Corporation, and Thomson Equipment Company, inmate
employment should increase to approximately 700 in October 2004.
Chairman Marvel recalled it
was Director Crawford’s goal to employ approximately 20 percent of the inmate
population.
Mr. Skolnik informed the
Committee there would not be 20 percent of the inmate population employed by
the Prison Industries until the Industrial Park had been completed. He advised that the industrial programs at
the new facility at HDSP could raise the number employed to 10 percent of the
inmate population.
In response to Chairman
Marvel’s question regarding the national rate for employment for inmates in
prison industrial programs, Mr. Skolnik answered the rate of employment
for the last 30 years had averaged approximately 6 percent. He added that the larger states were running
9 to 10 percent employment for industrial programs.
With regard to Chairman
Marvel’s question regarding whether the prison population had increased in
Concurring with Director
Crawford, Chairman Marvel related he was an advocate of
Relating that there were
there were "hot spots" nationally, Director Crawford informed the
Committee that due to the rapid growth of
Regarding Chairman Marvel's
question on how aggressive NDOC was in its alcohol and drug abuse programs, Director Crawford advised that in northern
Chairman Marvel asked if
Committee members had any further discussion on inmate employment. Backing up to the agenda item on the financial
statements, he questioned how the Ely Drapery Shop was progressing.
Mr. McCuin responded that
the Ely Drapery Shop's figures were now positive, partially due to the final
depletion of the depreciation for the Ely Drapery Shop. Mr. McCuin advised that due to the age of
sewing machines, the budget for the Drapery Shop allowed for replacement of one
machine per year. He added that old
machines are retained in order to utilize parts to repair other sewing
machines.
Mr. Skolnik interjected
that Prison Industries was considering increasing prices in January 2005 for
the Ely Drapery Shop, as it had been four years since its last price
increase. He explained that components of
the product such as steel hooks had increased.
Answering a question from Chairman Marvel concerning the shipment of
products, Mr. Skolnik related that freight was no longer a problem for the Ely
Drapery Shop.
IX. STATUS REPORT AND PUBLISHED
ARTICLES CONCERNING PROPOSED FEDERAL PRISON INDUSTRY LEGISLATION H.R. 1829 (HOEKSTRA)
AND S. 346 (LEVIN).
Mr. Skolnik related that at
the last Legislative Committee meeting of the ACA, Director Crawford was given
kudos by associates in
Mr. Skolnik informed the
Committee that he had recently read that service industry jobs are being lost
to computers and that jobs are going off-shore.
He said more managers are typing on their personal computers; thus,
replacing clerical/secretarial jobs. He
stated that he was not sure of the impact that would have on the service jobs
performed by prison industries.
Concluding his discussion
regarding federal legislation, Mr. Skolnik advised that Prison Industries
needed to stay vigilant with regard to any federal legislation being considered
in
Responding to Chairman
Marvel’s question concerning who the main lobbyist working on behalf of Prison
Industries was, Mr. Skolnik replied that the primary lobbyist force was the
National Corrections Industries Association.
Chairman Marvel expressed
his gratitude to Director Crawford in her lobbying efforts for Prison Industries. He asked for further questions or comments
regarding potential federal legislation relating to prison industries. Chairman Marvel acknowledged Assemblyman
Arberry's and Senator Rawson's presence in
X. PUBLIC COMMENT.
Chairman Marvel called for public
comment. There was no public comment
provided.
XI. ADJOURNMENT.
Chairman Marvel called for
any other business to come before the Committee. There being none, Chairman Marvel thanked the
Committee members and staff for their attendance and adjourned the meeting at
Respectfully
submitted,
Denise
Larsen
Secretary
APPROVED:
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