The city of North Las Vegas has so little cash on hand that it can’t afford much of anything. But the struggling municipality and its employee unions managed to come together this month to buy the one thing they needed most: time.
In January, the bargaining groups scored a $25 million judgment in District Court upholding contracted pay raises the city had illegally suspended two years ago through an emergency declaration. The city couldn’t pay the raises then, and it sure can’t pay them now. The judgment created a $17.8 million budget deficit for the city, a hole so deep the state was poised to put the government into receivership if the unions didn’t agree to accept a significantly smaller settlement.
As reported by the Review-Journal’s James DeHaven, marathon negotiations attended by Gov. Brian Sandoval and Assembly Speaker Marilyn Kirkpatrick April 9 and 10 resulted in a $7.7 million deal that provides the bargaining groups with much smaller pay raises — less than a third of what they were legally entitled to.
The deals will allow North Las Vegas to submit a final, balanced budget to the state by a June 1 deadline and, for now, avert an unprecedented state takeover that would have dissolved the city government.
“I’m happy to announce that we are a city on the brink of success,” Mayor John Lee told reporters at a news conference.
Success? We wouldn’t go that far. More like survival.
Left unsaid amid the sighs of relief that followed agreements with the Teamsters (who represent rank-and-file city workers), firefighters, police officers and police supervisors was the fact that the unions gave the city the least amount of flexibility possible. The groups could have shown some solidarity with taxpayers and taken no raises at all, thereby leaving North Las Vegas with just a little more financial breathing room. But they didn’t, and as a result, the city is one crisis away from being forced to drag the unions back to the bargaining table to discuss a new concessions-or-layoffs scenario.
When the City Council meets next month to vote on the contract settlements, no one should be deluded into thinking the city is out of the woods. Its personnel costs are headed nowhere but up. Pension contributions and medical costs will continue to rise, and unions will expect more salary increases. If the economy takes a dive, or even if it stagnates, the government will not have the reserves to meet its obligations going forward. The city’s payroll is not sustainable.
“We’re not going to reach a deal and then lay people off,” Councilman Isaac Barron said earlier this month. “I’ll resign in protest if we do that.”
But North Las Vegas is a fiscal mess because previous councils made foolish promises they couldn’t keep. They gave public safety workers the leverage to make outrageous demands by effectively declaring them off-limits.
There should be absolutely no guarantees for job security — no language that prohibits future layoffs — in this settlement. And no one on the council should offer the slightest assurance that the job of every remaining city worker is safe for even six months.
No one knows what the future holds. Thanks to these agreements, we know North Las Vegas gets a future. The city’s unions will decide how long that future lasts.