Emergency measures in the Nevada State Assembly this year included a bill to discourage discrimination against gays and lesbians, and another to establish full-day kindergarten classes. One bill gave the Nevada Commission on Sports and one nonprofit organization last-minute taxpayer handouts. However, a bill that would have saved taxpayers half-a-billion dollars was not considered an emergency.
Gov. Kenny Guinn introduced the plan that would end a retirement healthcare subsidy for future state employees when they retire.
“Currently, state employees receive full payment for healthcare coverage every year after they retire,” Guinn said. “Just like all other healthcare costs, these costs have risen dramatically for the state. We can no longer expect taxpayers to pay for these benefits.”
Such benefits are unique to public employees. A private business would go bankrupt trying to subsidize their retired employees healthcare coverage. General Motors is an example of a large company struggling with retiree benefits that are too liberal. The average taxpayer could never expect this type of benefit.
The bill, SB 484, would have revised provisions governing the Public Employees’ Benefits Program. It would not have affected current employees or retirees, only public employees hired after July 1, 2006. Also, the healthcare benefit would still be available.
PEBP covers four groups: state active employees, state retirees, non-state active employees and non-state retirees. A public employee can switch to the private sector and still qualify for the benefits when they retire.
The benefits work like this: Pre-1994 retirees receive a 100-percent subsidy for their health insurance. Post-1994 retirees qualify for a 25-percent subsidy after five years and receive a 100-percent subsidy after 15 years.
Nevada taxpayers pay for this healthcare subsidy that is growing every year by the millions. The money needed to pay these healthcare subsidies hasn’t even been funded, almost $4.4 billion. This is a liability that must be addressed to insure that Nevada’s bond ratings aren’t affected.
State senators passed the bill May 19. Days later, the Assembly referred the bill to the Committee on Ways and Means.
That was the end of the line.
In his January State of the State speech, Guinn said that this bold plan is “absolutely essential.” Nevada’s Assembly thought differently and refused to address the issue, even during an emergency session.
Considering the Democratic majority in the Assembly, it’s not surprising that this bill never came back from the Committee on Ways and Means.
Republican Assemblywoman Sharron Angle points out, “A committee chairman has a great deal of power; if he does not want to hear a bill, he simply throws it in his drawer and it’s never heard. And if it is not heard, it cannot be passed.”
Assembly Majority Leader Barbara Buckley suggested that the bill was cruel. Her emotional response ignores the fact that few taxpayers enjoy that kind of benefit and the program is a huge liability. Eventually, this costly problem will be too large to ignore. LW
