Time not on state budget’s side

By J. Patrick Coolican

Wednesday, May 20, 2009 | 2 a.m.

With the clock ticking down to the final days of the 2009 Legislature, legislative leaders were at a standoff on several crucial elements of the budget late Tuesday night.

Items in dispute include pay and benefits for public employees, with Democrats seeking to protect those loyal constituents. Democratic leaders argue that state workers have sacrificed enough with pay cuts to help the state balance its deficit-laden budget.

Republicans counter that they agreed last week to a $780 million tax increase on the condition that Democrats would sign on to changes Republicans sought.

Those include revisions of the collective bargaining process for employees of local governments in Nevada and steps to tighten rules on retirement and health benefits for new government employees. Republicans say the changes are necessary because the state’s retirement and health benefit system faces a long-term liability of $11.25 billion and growing.

Time is growing short.

The Legislature’s 120-day session ends June 1. Gov. Jim Gibbons will likely veto any tax increase and he can delay acting for five days after the Legislature sends him a final budget.

Counting backward, legislators think they need to have a deal by Thursday or Friday if they are to give Gibbons time to act and the Legislature time to override any veto by June 1.

If the clock runs out, the Legislature can act on a veto only if Gibbons first calls them into special session, a step lawmakers think is unlikely if it means his veto will be reversed.

In that case, a constitutional crisis could ensue, with the two branches of government fighting over who has the authority to set budgets.

Lobbyists and legislators told the Las Vegas Sun on Tuesday that the standoff occurred after negotiations between two Las Vegas legislators, Democratic Assemblyman John Oceguera and Republican Sen. Warren Hardy. In the negotiations, Oceguera told Hardy that some items Hardy wanted were reasonable, but the Democratic caucus later rejected them.

Hardy said he was not angry because he knew any agreement would have to win approval of the respective caucuses. Still, he said, “I was frustrated because I thought we had agreement on some issues.”

In their defense, however, Democrats say Oceguera had a more difficult job in bringing along the 28 members of the Democratic caucus as opposed to Hardy, who needs only two Senate Republican votes to override the expected Gibbons veto.

But lobbyists who asked to remain anonymous so as to not disrupt the sensitive negotiations said some problems arose.

Assembly Speaker Barbara Buckley seems to have not granted Oceguera full authority to negotiate on her behalf. Oceguera said this assertion is untrue. He said they made progress on a range of issues involving retirement and health benefits and changes in the collective bargaining process. On the thorniest remaining issues, including eliminating binding arbitration from the collective bargaining process, setting the retirement age for new employees at 62 and eliminating the retiree health care subsidy for new employees, Oceguera said he told Hardy he would take the issues to the Democratic caucus, but made no promises.

“There were a few leftover items where I said, ‘I’ll see where I can get with these.’ ”

Another reason for the breakdown is that some of the issues are politically volatile, which Oceguera may not have anticipated. For instance, Hardy said Oceguera said the idea of ending binding arbitration for local government employees is reasonable.

The issue is important because local government workers, who traditionally ally with Democrats, are forbidden by law to strike. Eliminating binding arbitration would give those workers little recourse if they reach an impasse in bargaining.

Oceguera said he is against the idea of ending binding arbitration.

Another sticking point is changes in the retirement system, a Senate Republican said.

Republicans want a minimum retirement age of 62. The change would apply to new employees only.

David McGrath Schwartz contributed to this story.