Last week, Democratic gubernatorial candidates Steve Sisolak and Chris Giunchigliani both announced they support decreasing education funding.
They didn’t phrase it like that, of course, but that would be the inevitable result of the policy they both embraced — collective bargaining for state workers.
Currently, state workers may join a union, but the Legislature sets their wages. Employees can take it or leave it. It’s much different in local government. Local officials must negotiate with employee labor unions under terms set by state government. Collective bargaining is the main reason why Nevada has some of the highest-paid local government employees in the country. It’s why the Clark County School District is on the brink of financial collapse and other local governments keep facing budget shortfalls despite rising revenues.
Collective bargaining for state workers would create similar issues for Carson City. State workers would have the “right” to negotiate for pay increases. If an agreement isn’t reached, an unelected, unaccountable, out-of-state arbitrator would decide the dispute. The first thing an arbitrator looks at is if the employer has the ability to pay, which the state does. He or she then examines pay for government workers in and out of the state. Because collective bargaining has inflated local government pay, state workers would have an easy time winning pay hikes.
Where would this money come from?
Most of the state general fund goes to Medicaid and education. Medicaid spending has grown rapidly in the past decade. Nevada’s general fund spent $384.6 million on Medicaid in fiscal 2010. In fiscal 2019, that’ll increase to more than $700 million. That number will keep skyrocketing thanks in part to Gov. Brian Sandoval’s decision to expand the program under Obamacare to include healthy, able-bodied adults. The federal government picked up the full tab initially, but its reimbursement rate is declining.
That leaves education funding as a target. Initially, higher education is likely to feel most of the pinch, like it did during the Great Recession. But allowing collective bargaining for state workers will drive up costs and eventually force lawmakers to squeeze K-12 education funding, too.
During the boom years, it’s easy to mask these flaws as the money flows in. During downturns, however, the folly of state worker collective bargaining will be readily apparent. Revenues will decrease, but collectively bargained contracts will have locked in raises for state employees. Tax hikes will be difficult, too, because they require a two-thirds majority.
You wouldn’t know it from the promises politicians make, but state funds are limited. Collective bargaining for state workers will greatly expand personnel costs, further soaking Nevada taxpayers and leaving less money for lawmakers to spend on local schools.