Unions ID areas to help stretch LV budget

Call it a tale of two budgets, even though it only concerns one -- the city of Las Vegas' annual spending plan.

A review of city finances commissioned by city employee unions claims to have identified at least $125 million in "pockets of funds" throughout the budget that could be used to address a funding crunch that has city leaders talking about layoffs and cuts to pay increases.

In response, the city says that the study is mistaken -- the money it says is available either isn't there or its use is tightly restricted.

And the budget picture has reportedly grown even bleaker. The predicted five-year, $150 million shortfall "could easily be $200 million to $250 million," wrote Mark Vincent, Las Vegas' finance guru who is working as interim deputy city manager.

"This recession is as unprecedented as the growth periods in the late 1990s ... and mid-2000s," he wrote in a letter to the four unions that represent city employees.

The letters between Vincent and the unions' accountant, Beth Kohn-Cole, are long and technical, but here are the highlights:

* Study: Positions are being held vacant but those savings aren't being included, which means there's $20 million overbudgeted for salary and benefit costs.

City: Yes, savings are expected. But the original forecast was for consolidated sales tax revenue to dip $1.8 million; through November, collections are on course to fall $13.8 million.

* Study: There's $4.5 million in excess funds because expenditures were cut.

City: The cuts were in response to the downturn, and those funds will contribute to reserves to weather the storm.

* Study: There's $19 million that's been set aside for police post-employment benefits that's not needed, because those costs can be paid with other funds

City: Nope. That money has to be on hand for Las Vegas' portion of those costs, which are shared with Clark County.

* Study: There's $27 million sitting in a "multipurpose fund" that's not being used.

City: Almost all of that money comes from specific sources (Darling Tennis Center endowment, Centennial license plate fees) and can only be used for specific projects and programs.

* Study: The Fire Safety Initiative has $5 million that's just sitting there.

City: Not for long. That's going to help pay for firefighter costs so that other money can be free to help with reserves.

* Study: A $47 million "stabilization fund" that was cobbled together by delaying capital projects and redirecting other funds can be used to keep things afloat.

City: It already is, in large part for the post-employment benefits cost mentioned above. And it's not going to be enough.

* Study: The city's keeping too much in reserve and is grossly overestimating its workers compensation liabilities for public safety workers with job-related heart and lung disease, cancer or hepatitis.

City: Those liabilities are figured independently and failure to show how to fund them reflects poorly on the city's financial rating. Furthermore, the city's trying to get through the next few years while maintaining a reserve fund of at least 10 percent "to hold off program cuts and reductions in force."

Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.