EDITORIAL: Clark County taxpayers lose-lose in school district arbitration case

Another unelected, unaccountable, out-of-state arbitrator has punched local taxpayers in the mouth. The result could be a $51 million hit for the Clark County School District and again highlights the need for Nevada lawmakers to reform the collective bargaining process.

On Friday, arbitrator Mario Bognanno, a professor emeritus at the University of Minnesota’s Carlson School of Management, sided with the Clark County Education Association in a nine-month contract dispute with the district. The decision will cost the district $13 million this fiscal year and $38.5 million the next in pay hikes and increased health care contributions.

The ruling comes just months after the district faced a round of budget adjustments brought on, in part, by a separate arbitrator’s decision granting raises to school administrators. Nevertheless, Mr. Bognanno waved his hand and decreed that the district must now meet the teacher union’s demands simply because the trustees have the “flexibility to transfer money” between accounts, and its tiny ending funding balance of $18 million — barely three days of operating expenses — amounts to “available” money.

“The arbitrator concludes,” Mr. Bognanno wrote, “that the district has the ‘ability to pay’.”

And that’s it. One man halfway across the country has the ultimate power to set budgetary policy for the Clark County School District, and there’s nothing anybody can do about it.

The district does have the right to appeal, of course, but that would be costly, and there’s no guarantee of success. A better approach would be for district lobbyists to push for reform at the 2019 legislative session.

Collective bargaining and binding arbitration for public employees is a consistent loser for taxpayers. The process puts government at both sides of the negotiating table and undermines any incentive for compromise by tossing the matter into the hands of an unaccountable third party in case of an impasse. Meanwhile, the arbitrator is bound by state statutes which codify that the taxpayers lose if the government agency has the “ability to pay” — a standard that can be construed to justify virtually anything.

The process also provides cover for government negotiators by allowing them to point the finger at an arbitrator in place of taking responsibility for a bad deal.

“The incoming money is not there to support this,” said School Board President Deanna Wright of Mr. Bognanno’s decision. “If we take it from the ending fund balance or we have to make more cuts or a combination, it’s a lose-lose.”

It’s time to change this rigged system. If Nevada lawmakers truly represent the taxpayers, they’ll make collective bargaining reform a priority when they reconvene in Carson City next year.