Local governments’ financial pain

State lawmakers haven't cornered the market on complaining. This week, in city council chambers across Clark County, municipal elected officials lamented their fiscal fortunes and learned that they'll have to make lots of budget cuts to get by in the years ahead.

They have no one to blame but themselves.

Yes, the genesis of this recession was well outside their control, and no one in Nevada could have predicted the severity of the state's economic collapse. But the cities of Las Vegas, North Las Vegas and Henderson still enjoy tremendous revenue stability when compared with the state government and Southern Nevada's private sector.

They're pleading poverty because they've put public employee unions in control of their finances, and the unions have no interest in making the kinds of sacrifices needed to balance municipal budgets in the years ahead.

In the city of Las Vegas, the general fund is expected to grow -- grow! -- 4 percent in the coming fiscal year, to $533 million. Tax revenues are expected to decline 2.5 percent, so reserve funds will be used cover the shortfall.

The North Las Vegas City Council on Tuesday adopted a $202 million general fund that's $21 million smaller than its current spending plan. The Henderson City Council, meanwhile, approved a $222.8 million general fund that's only $15.1 million short of this year's budget total.

Because the economy isn't expected to recover for at least another year, and because governments can't ever count on a return to the boom times that produced double-digit rates of growth in annual tax collections for the better part of two decades, council members know they have to rein in expenses -- fast.

But their personnel costs -- the lion's share of each budget -- will continue to grow unmercifully.

Municipal workers across the valley have long enjoyed annual, guaranteed pay raises of between 6 and 9 percent, split between a "step" or "merit" raise with no nexus to job performance and a "cost-of-living" raise with no link to the Consumer Price Index.

At the city of Las Vegas, for example, personnel costs will increase by $18.2 million even as tax revenues shrink. Henderson and North Las Vegas face similar problems. All require significant concessions from unions with contracts that keep their respective gravy trains rolling.

But the unions' ideas of concessions revolve around accepting smaller pay raises in exchange for longer contracts.

In other words, continuing the guarantees even though, in this economy, there are none.

If the valley's city governments are serious about getting a grip on their budgets, they'll finally draw a firm line in the sand when dealing with their bargaining units: All contracts that continue through the next fiscal year must be torn up, and all salaries must be frozen for the next year in lieu of layoffs.

If the city councils can't get tough in these tough times, they never will.