Clark County workers represented by the Service Employees International Union — pretty much the entire non-management payroll outside of public safety — are the most recent bargaining group to make contract “concessions” in the midst of the struggling economy.
Their sacrifice? Nearly 10,000 county employees will get pay raises of about 5 percent in each of the next two years — a 1 percent “cost-of-living” raise with no relation to the cost of living, and a 4 percent “merit” raise with no meaningful link to actual performance — instead of the 8 percent raises they previously had negotiated.
“We want to avert layoffs and maintain our public services,” said Al Martinez, president of the SEIU of Nevada. “We want to do our part and our contribution in dealing with this issue.”
Who is Mr. Martinez trying to fool? These concessions are minimal, at best.
Clark County’s finances have fallen off a cliff. After seeing property tax collections quintuple in less than 20 years, revenues are expected to decline by $82 million in the coming fiscal year. And the county’s general fund, which totaled about $1.4 billion this year, will have to be at least $114 million smaller next fiscal year.
Mr. Martinez says his union wants to “maintain our public services”? That’s not possible with the unsustainable, nation-topping salaries and benefits his union has leveraged over the years.
To balance the general fund, the county must freeze 200 positions at University Medical Center, the county’s only public hospital. It must leave 400 other county positions vacant and possibly delay the opening of a badly needed low-level offender jail. Taxpayers would still have to pay more than $11 million per year to the jail’s developer, even though the facility would remain empty and unstaffed.
The SEIU’s sacrifice will “save” the county less than $10 million per year — while ensuring its personnel costs continue to compound each year. Combined with the aforementioned cost-cutting measures, it doesn’t even get Clark County halfway to the spending reductions it needs to identify. Officials still have no idea how to slash an additional $44 million.
Yes, this valley’s real estate collapse and sharp drop in tourism and convention business would have hurt local government finances even if public employees were paid salaries more in line with their private-sector equivalents. But Clark County commissioners have made it their top priority over the years to transfer every available taxpayer dime to the employee unions which in turn dedicate their support to re-electing incumbents.
“We’re facing unprecedented economic trouble in our community and we needed unprecedented cooperation between the employer and employees,” Commissioner Rory Reid said.
This savage cycle of wage growth left the county suffocated before it even started its budget planning process. And the commission’s response was to not only support labor cost increases it clearly cannot afford, but to extend its contract with the SEIU for an additional year. Instead of drawing a hard line and demanding short-term, good-faith gestures that reflect the severity of the recession, the county has entered a fiscal suicide pact.
The bill is coming due. It will make Mr. Reid’s definition of “unprecedented” look downright routine. For taxpayers, it will cost them the services and amenities they expect from their billions of dollars in tax revenues.
But don’t worry about Clark County employees. The job of every current worker will be preserved no matter how bad things get, with guaranteed annual wage growth and a platinum-plated pension upon early retirement. Even if it takes every last dime of your money.