Thursday, May 24, 2012 | 2 a.m.
The country may be healing economically, but local governments here are just beginning to fret about what’s to come.
No one wants to end up like cash-strapped North Las Vegas, which is contemplating suspending parts of the city’s contracts with unions to control costs.
But the very real fear that the separate governments of Clark County and Las Vegas don’t see a quick end to their depleted budgets became evident, police sources told the Sun, during closed-door talks Monday between Metro Police administrators and elected officials from the city and county.
The upshot: Neither the city nor the county want to give Metro any more money than is necessary. And with Metro facing a budget hole that could be as high as $68 million in the fiscal year starting July 1, 2013, the city and county do not want to have to fork over the millions more needed to fill that void.
So this is what happened:
During a closed-door session to discuss contract negotiations with Metro’s civilian employees union, sources said, Sheriff Doug Gillespie recommended 3 percent merit pay raises in the first year and 1 percent in the second year of a two-year contract. Seeing he wouldn’t get that, he switched to 1 percent and 1 percent.
Then came the surprise. The city’s two representatives, councilmen Stavros Anthony and Ricki Barlow, drew a line in the sand. They said no union merit increases, no benefits increases, no increases at all for a contract that would extend from July 2013 through June 2015.
Eyebrows raised. Barlow and Anthony are both fairly new to Fiscal Affairs, and no one expected either, especially Anthony, a former police officer, to object to the sheriff’s budget.
Their argument, though, was pretty clear. In the next two years, Las Vegas will start making some new bond payments; it has already set aside additional money for Metro in fiscal year 2013 (which begins July 1, 2012); and it will start making lease payments on the new City Hall. Those payments will grow to $13.4 million annually by 2017.
Meanwhile, the city each year has to come up with 40 percent of Metro’s budget that isn’t covered by self-generated revenues. That also means that if Metro needs additional dollars to eliminate a deficit, the city will need to come up with 40 percent of the department’s needs.
Metro’s budget hole is expected to be anywhere between $50 million and $68 million. That means the city would need to find an additional $20 million to $27 million. The county’s share would be an additional $30 million to $41 million because its share of Metro’s budget is about 60 percent.
Adding to the county’s potential problems is another monumental money issue in 2014. That’s the year voters will decide whether to tax themselves again, renewing a 20-year-old, voter-approved tax that raises about $15 million per year for Fire Department operations and capital expenses. There’s a real chance voters could say no, given that many observers see firefighters in the midst of a public relations disaster tied to sick-leave abuse, firefighters’ relatively high wages and benefits, and county battles against the firefighters union.
Barlow and Anthony don’t represent a Fiscal Affairs Committee majority, sources said, but the three other Fiscal Affairs members — County Commissioners Steve Sisolak and Larry Brown and private citizen James Hammer — also appeared to be against increases.
Neither Sisolak nor Brown would comment about that closed-door discussion. Anthony and Barlow could not be reached for comment.
Sources said the sheriff said the union’s stance was that it had given concessions over the last three years, but now it’s time for some payback. Last year, the union gave up merit and longevity pay increases for one year, the third year in a row the union made concessions. (Union members did receive a 1.125 percent increase in pension contributions.)
That didn’t sway the Fiscal Affairs Committee members, however.
For years, Sisolak has harped that the time for concessions by unions was far from over, that the private sector was hurting as much or more than unionized employees and that tax dollars were far from peak levels of five years ago when all Nevada governmental units were flush with dollars from wild-eyed development.
“The problem is the county isn’t collecting more tax dollars,” Sisolak said Tuesday. “We’re still struggling.”
In part, political observers told the Sun, Metro dug its own hole by winning approval for sizable wage and benefits increases over much of the last three decades. The department’s budget, now about a half-billion dollars, increased 10 percent annually for 25 years until 2010. Complicating the situation even more is the sheriff’s promise not to lay anybody off during these tough times.
Sisolak and Brown showed up about 10 minutes into the county’s special budget meeting Monday, late because of the unusually long Fiscal Affairs meeting earlier in the morning.
During the commission meeting, Brown looked concerned. He and the other commissioners approved the Clark County budget for fiscal year 2013. Before doing so, Brown hinted at what went on in Fiscal Affairs, and in doing so issued a warning about the future.
Brown said government views it as a “savings” if it grants public employees raises that are less than expected. The fact remains it is still a raise. Even smaller increases in pay add up. To keep paying those increasing wages, government must cut services or supplies to the bone.
“We’re giving employees pay raises and cutting back everything else ...” he said. “We start getting to the point where to balance the budget we cut ... priority needs.”
Brown applauded the county for cutting where it could (a county spokesman said it has eliminated 972 positions and laid off 422 full-time employees over three years), but he believes harder times are on the way.
“It’s going to hit us,” he said. “It’s going to hit us harder than even the tough times two or three years ago.”