Clark County Commissioners signed off on adjustments Tuesday to the retirement plan for Las Vegas Valley Water District employees, but not before demanding more oversight over future decisions involving the almost $265 million fund.
Though commissioners seemed to agree with the changes — including some that took effect months ago — they objected to being left in the dark, despite the existence of a special board subcommittee for pension plan matters.
Commissioner Steve Sisolak was especially critical, grilling water district staff members about a particular decision made last year to have the utility switch from using a third-party insurance company to manage pension benefits to directly paying retirees from a Wells Fargo Bank account.
“It never came to the subcommittee, which hasn’t met for years and years and years. It never came to the subcommittee or the full board. It just happened in a vacuum,” Sisolak said. “There was one person who was deciding this and how to invest $300 million in a vacuum by herself.”
“I don’t think one person should have this kind of authority.”
Though Sisolak didn’t mention her by name, he was talking about Pat Mulroy, the long-time general manager of the water district and its sister agency, the Southern Nevada Water Authority, who retired in February.
After the meeting, Mulroy’s replacement, John Entsminger, said his former boss was advised by legal counsel that she had the authority to steer the pension program the way she did.
He added that the district expects to save about $7 million per year by switching to a direct-pay system with “no change” in the monthly payments retirees are due to receive.
“The pension benefit for employees is exactly the same as it’s always been,” Entsminger said.
Mike Rivney is not convinced.
He worked in the water utility’s IT department for 11 years before taking early retirement in March, the month before 101 employees were laid off by the district and the authority.
He said he considers the switch “a down-grading” of his pension that puts his retirement savings at greater risk.
Mostly, though, he’s angry there was no public discussion before the retirement agreement was changed. Employees weren’t even informed about it until he “stirred the pot,” Rivney said.
“What kind of company doesn’t inform its employees of such an important change?”
But Entsminger insists Rivney and others have nothing to worry about. Their pension payments haven’t been diminished by “one thin, red cent” as a result of the change, and neither has the security of their retirement nest eggs. The district is ultimately liable for the pensions of its employees, just as it was before the switch to a direct-pay system at the start of the year, he said.
As for complaints from the commission, which serves as the water district’s board of trustees, Entsminger promised to meet with subcommittee members at least once a year and supply them with copies of any documents they want.
Almost 1,400 current employees participate in the district’s pension plan, which currently serves about 500 retirees.
Despite the concerns about a lack of oversight, Entsminger said the pension program is about 69 percent funded, a healthy level comparable to the state public employee retirement plans in Nevada and California.
“The good news is the plan is in good shape,” he said.
Contact Henry Brean at firstname.lastname@example.org or 702-383-0350. Follow @RefriedBrean on Twitter.