large-scale project is a significant commitment, not only in dollars but also in human capital. The Division is keeping its eye on the successes and lessons learned in other states to maximize Nevada’s investment and avoid costly pitfalls over the course of the project. A few states have already encountered project failure or entered into litigation with their software vendors or they are salvaging their financial investments with less than satisfactory results. One of the things that we hope to do in Nevada is take advantage of the lessons learned. With the assistance of the information development and processing division, IDP, Nevada Employment Security estimates the cost of modernizing our UI system with reach $30 million. So one of the first steps that we will take is to develop a total system requirements fully integrating the major business functions, such as the employer contributions, accounting and audits, benefit delivery, appeals, overpayments and federal reporting. The initial task to define system requirements is in itself a good-sized project. This will require months of analyzing and documenting the business process workflows and data languages that exist between the divisional business units, other agencies or states. When all of this detailed information is filtered through the business requirements, the project team will then have to make decisions about the scope of our modernization effort and evaluate appropriate technology solutions. Project cost estimations will be weighed against the anticipated benefit or improvement to the process of collecting employer contributions and the paying out of our weekly unemployment benefits.
Chair:Thank you very much, Valerie. Appreciate it.
Agenda Item VIII - Workshop to Consider Adoption of Regulation to Establish UI Tax - Rate Schedule for Calendar Year 2007 (NAC 612.270)
Chair:We’re ready for our workshop to consider adoption of regulation to establish the Unemployment Insurance (UI) Tax Rate Schedule for Calendar Year 2007 under the Nevada Administrative Code 612.270. First we will have economic projections and overview by Jered McDonald, Economist, Research and Analysis Bureau, DETR.
McDonald:Good morning, Mr. Chairman, and members of the Council. My name is Jered McDonald. I am an economist with the Research and Analysis Bureau in the Department of Employment, Training and Rehabilitation. I’m here to give two presentations today. The first will be the Nevada Economic Overview and the second will be a Review of the UI Trust Fund. We’ll take a look at how it’s performed over the last year and see what we’re predicting for the coming year and the years after that. Here’s a look at Nevada’s labor market areas. And you can see that Nevada’s current labor force is 1.253 million with about 71% of our labor force in Las Vegas. From 2004 to 2005, you can see the population has hit 2.4 million. We’ve added about 81,909 people. That’s about a 3.5% growth. Here’s a look at job growth rates from 1995 to 2005 for Nevada, the United States and California. And you can see that Nevada has faired pretty well on a percentage basis versus our neighbor and the Nation. It’s pretty easy to point out where the most recent recession took place, where we bottomed out in 2001 and did manage to create a few jobs. Employment growth has rebounded since then