North Las Vegas put settlement deal on paper — $5.6 million for unions

North Las Vegas officials put a union settlement agreement on paper Friday, ponying up $5.6 million for a long-awaited, out-of-court deal with city bargaining groups.

But the deal, which could require a tax increase for residents of the financially ailing city, is far short of officials’ previous target of $7.7 million.

The draft agreement handed over to union heads this week puts the city a few pen strokes away from settling a two-year legal battle over $25 million in union employee pay raises first suspended under the terms of a city-declared fiscal emergency in June 2012.

Neither side has released figures identifying settlement cash offered to each of the four unions embroiled in the long-running contract dispute.

Both declined to comment on the status of an additional $2.1 million in settlement funds targeted in North Las Vegas’ More Cops sales tax account, dollars that remain contingent on future police union concessions.

Payments to the city’s firefighters, police officers and Teamsters are expected to make up more than half of the proposed deal, with back pay and benefits owed to police supervisors totaling around $1 million.

City leaders came within hours of drawing up a similar settlement offer on Wednesday. Then, according to officials, math intervened.

The settlement proposal scuttled early this week hinged on $8 million in new revenue state tax officials said the city could raise through the adoption of a 30-cent property tax hike.

City Council members, who would have to approve the tax increase before it could take effect, were never all that hot on the idea.

But support for the effort cooled dramatically in the weeks since Las Vegas Chief Financial Officer Mark Vincent told the city that any future tax bump would be hamstrung by state-imposed property tax caps — leaving North Las Vegas with about an eighth of the new tax revenue once projected by state tax officials.

Officials said city leaders have made it clear that any settlement reached with North Las Vegas’ bargaining groups should be contingent on the city’s ability to balance its books going forward.

Without concessions to make up for the sudden disappearance of several million dollars in state-projected tax revenues — dollars already baked into the city’s first settlement offer — officials found themselves back to square one.

“We thought we had an understanding of what a tax increase would do for us,” city Finance Director Darren Adair said. “Last week’s results, post-abatement, were depressing.

“The problem is feeling boxed-in. We can’t raise more revenues. We can’t do layoffs. What other options can we consider?”

Accounts of the shelved proposal’s demise don’t quite pass the smell test for some union heads, who say city officials never mentioned problems with tax math in abruptly canceling settlement talks scheduled this week.

Leaders with each of the city’s public safety unions declined to comment on specifics surrounding a replacement settlement drafted Friday.

All three previously have agreed the city should take a much harder look at millions of dollars in state sewer repair funds freed up for city use recently under Assembly Bill 503, a point hammered home by Police Officers Association attorney Jeffrey Allen at an Employee Management Relations Board meeting Tuesday.

Audio from the meeting obtained by the Review-Journal hints at a long and potentially fractious negotiation process still to come, with union attorneys arguing for broader access to settlement funds and the city maintaining it’s already tapped out.

“There are plenty of things (the city) could do,” Allen said Tuesday. “They could sell off assets, they could close a park, they could close a library, they could lay off nonpublic safety employees, they could even raise taxes.

“We are not going sit here and tell you these are good options … but the idea that the only way the city is going to get out of this is by laying off public safety officers is just incorrect. ”

City officials haven’t issued union leaders a timetable for signing on to Friday’s settlement offer.

They have four weeks to round out an agreement with bargaining groups before submitting a tentative budget to state tax officials by April 15.

Contact reporter James DeHaven at 702-477-3839 or jdehaven@reviewjournal.com. Follow him on Twitter @JamesDeHaven.