Political Update – March 6, 2018
Assemblywoman's pension 'fix' akin to pouring gasoline on a fire
By Robert Fellner
NPRI
March 1, 2018
In trying to come up with ways to tackle Nevada’s soaring pension debt, a key Nevada legislator put forth an idea that is the functional equivalent of trying to put out a fire by dousing it with gasoline.
At last week’s Interim Retirement and Benefits Committee legislative hearing, Assemblywoman and Committee Chair Maggie Carlton made it a point to declare that increasing wages for government workers was a viable way to reduce Nevada’s pension debt.
At the outset, it’s important to remember that the only reason PERS $13 billion unfunded liability matters is because of the massive burden it imposes on the government workers and taxpayers who must pay down this debt.
So suggesting higher wages as a way to reduce Nevada’s pension debt is a bit like recommending that a family struggling with credit card debt take out a lease on a brand new Mercedes — with no real strategy for how that will help other than belief in the phrase, “you’ve got to spend money to make money!”
But it’s actually even worse than that. Because higher wages translate to higher future pension benefits, Nevada governments and taxpayers would get billed twice: as the cost of higher wages is compounded by higher annual pension costs.
So what, if any, reduction in PERS unfunded liability would occur in exchange for increasing both the annual wage and retirement costs of Nevada governments?
Literally, zero dollars — and that’s in the best-case scenario. But more on that later.
Carlton’s genuinely too-good-to-be-true proposal came in response to a presentation by PERS executive officer Tina Leiss.
Leiss was discussing the result of payroll growth having been far below what the System assumed over the past 10 years.
And because PERS sets annual contributions as a percentage of payroll — rather than a level-dollar amount — the lower-than-assumed payroll growth means debt payments coming in below forecasts, which in turn requires levying higher contribution rates on public employees in order to ensure the full, expected dollar amounts are received.
Quote of the week
Quote:
"In trying to come up with ways to tackle Nevada’s soaring pension debt, a key Nevada legislator put forth an idea that is the functional equivalent of trying to put out a fire by dousing it with gasoline." - Robert Fellner, NPRI,
March 1st, 2018
Nevada continues to deny public records requests
By Michael Scott Davidson
Las Vegas Review-Journal
March 4, 2018
The state of Nevada refuses to divulge how much it has paid former employees for their unused sick and vacation leave.
Since October, the Las Vegas Review-Journal has sought comprehensive information documenting how much money individual employees received when they retired, resigned or were fired. The request, if fulfilled in its entirety, would encompass employees spanning from department executives to rank-and-file workers such as DMV clerks.
Keystone's Mission:
To recruit, support and advocate for candidates for public office who support
private sector job creation, low taxation, a responsible regulatory environment, and effective delivery of essential state services.
Keystone's Mission:
To focus on candidate support on state legislative races and the governor's office.
• To oppose any form of corporate income taxes or other business taxes that discourage capital investment and therefore job creation.
• Support limiting Nevada state government spending to the rate of population growth
