Public fund covers Metro Police’s insurance program shortfall

By Joe Schoenmann

Thursday, May 27, 2010 | 2 a.m.

Eight years ago, taxpayers bailed out Metro Police’s insurance program with a $2 million infusion to cover unpaid medical bills.

Now, some Clark County commissioners want the money back.

Their interest in reclaiming the money follows approval of a new one-year contract for Metro officers. The agreement reduces the clothing allowance, saving $2.4 million. It cuts in half the amount of vacation that officers can sell back from 40 hours to 20, saving about $860,000. It also reduces Metro’s contribution to the health insurance — from $9,072 to $8,572 per officer, for a savings of $1.6 million.

What has caught the attention of Commissioners Rory Reid and Steve Sisolak is that the officers won’t have to cover the $1.6 million themselves. Rather the taxpayer-funded Employee Health and Welfare Trust has enough in reserve to continue funding officers’ insurance over the next year despite a decline in Metro’s contribution.

If the insurance trust is that healthy today, why hasn’t it repaid Clark County, Reid and Sisolak wonder.

“The county now is certainly in a much more vulnerable position financially; it seems like turnabout would be fair play,” Reid said.

The commissioners also questioned whether the change in officers’ insurance contributions even constitutes a concession on the union’s part. Metro’s contribution is being cut 5.5 percent, one year after the union negotiated a 7.5 percent increase. But the only entity giving up anything is the Health and Welfare Trust, and that is taxpayer-funded.

“Metro is saving $1.6 million, for sure, but it’s no concession, not by anyone’s definition, because the police aren’t really giving anything up,” Sisolak said. “The trust is giving up money, not police.”

The issue first arose this week during a meeting of Metro’s Fiscal Affairs Committee, which is chaired by a nonelected citizen and includes two members each from the Las Vegas City Council and Clark County Commission. The committee voted to approve the contract, which puts Metro’s budget for the fiscal year starting July 1 at $513 million, down from this year’s $549 million, a reduction of 6.6 percent.

(The vote violated state law because no public hearing on the contract was held, as required by a new statute.)

Karen Keller, Metro’s executive director of finance, spent about a minute highlighting union concessions won during collective bargaining.

Sisolak, a county commissioner on the Fiscal Affairs Committee, said Keller did not mention that the insurance costs would be covered by the trust. “It’s not that anyone misspoke, they never said a word,” Sisolak said.

In an e-mail to the Sun, Keller said the cut in insurance costs is a concession. “This reduction is a direct savings to the salary and benefit costs” that the department would have paid in the coming year, she said.

Asked about the insurance trust, Deputy Chief Greg McCurdy, who is co-chairman of the trust’s board, said it is “in sound financial shape.”

The $1.6 million reduction in contributions from Metro was discussed “extensively” by the trustees, McCurdy said. “They felt they could stay with the lower contribution without serious financial impact.”

Chris Collins, Police Protective Association executive director, said, “There is enough money in the reserves to supplant the difference for a year.”

Sisolak said he has learned that the Health and Welfare Trust has a reserve of at least $20 million.

If the fund does contain $20 million, it raises questions, Sisolak said: Are county taxpayers contributing too much to officers’ health insurance? Why don’t the county and city, which contribute to Metro’s budget, have representation on the trust’s board?

It also appears unlikely that the county will get its $2 million back. Neither the city nor county drafted documents requiring repayment, officials said.

“When GM gets money from the feds, they pay it back when they can,” Sisolak said. “Why didn’t we agree to the same thing?”