Special to the Las Vegas Review-Journal
May 2, 2020
Nevada’s government unions have for years successfully thwarted all efforts to reform the state’s public pension system, despite warnings from experts that it would be their own members who would suffer the most in the event of an economic recession or stock market downturn.
Sadly, that time has now arrived. Plummeting tax revenues from the coronavirus fallout will leave many agencies unable to pay their ever-growing PERS bill, leaving them no choice but to cut salaries and lay off government workers.
Even in good times, the cost to keep the Nevada Public Employees Retirement System afloat imposed a tremendous burden on taxpayers and government workers, who were constantly being forced to pay more while getting nothing back in return.
Despite a record-long stock market bull run over the past decade, the cost to keep the system afloat continued to grow at a remarkable pace. Today, the PERS contribution rate for most public employees is at an all-time high of 29.25 percent — up 36 percent from 2009.
This means that every $100 in salary paid to a teacher or other public employee now requires an additional $29.25 contribution to PERS, with taxpayers and employees splitting this cost. Police and fire officers are the one exception, as their much richer benefits cost 42.5 percent of pay, with taxpayers seemingly bearing the entirety of that cost.
In total, taxpayers and public workers will send $2.2 billion to PERS this year — or more than triple the nearly $700 million in budget cuts that the state is preparing to implement as a result of the economic fallout from the coronavirus.