Senate flap over bill privatizing industrial insurance

Jennifer Coleman

Friday, April 30, 1999 | 12:31 p.m.

CARSON CITY - GOP Gov. Kenny Guinn's worker compensation bill was jammed through the Nevada Senate on a 12-6, party-line vote early today over protests of minority Democrats.

"If you don't want free expression, why don't you declare a dictatorship?" said Sen. Joe Neal, D-North Las Vegas, as Republicans cut off debate on the bill that privatizes the system insuring employers for on-the-job injuries.

A few minutes after the scheduled 12:30 a.m. session was convened, the bill was passed and most Republican senators left despite Neal's efforts to utilize an old Senate rule to force them back into session.

"You may be in adjournment but I suggest the absence of a democracy," said Sen. Bob Coffin, D-Las Vegas.

The action sends SB37 to an uncertain future in the Democrat-controlled state Assembly.

On Thursday, the Senate Democrats had blocked a floor vote on the bill, stalling for time by saying they hadn't been able to study a critical amendment.

The minority Democrats invoked a Senate rule to ensure that a vote couldn't be taken until the next day. Sen. Bill Raggio, the Republican majority leader, retaliated by ordering senators to convene shortly after midnight.

Senate Commerce and Labor Chairman Randolph Townsend, R-Reno, joined with Raggio in today's predawn maneuver by moving to end debate before it ever started. Republican Lt. Gov. Lorraine Hunt, who serves as Senate president, allowed the partisan move, prompting Neal to say she was being "used" by Raggio.

On Thursday, Senate Minority Leader Dina Titus, D-Las Vegas, was one of several Demoocratic senators who questioned the plan to privatize the state-run Employers Insurance Company of Nevada.

"Are we turning the fate of injured workers over to a company we have no control over?" she asked, adding that the managers of the current system have a poor management record. The state system nearly collapsed in the early 1990s.

Townsend said the new company, like any private company, would become part of the Nevada Insurance Guaranty Association, which covers policies if the insurer becomes insolvent.

The state will open up the workers' compensation market to competition from private companies on July 1.

At stake is premium income totaling $440 million a year. The state's share has amounted to $385 million in premiums from 46,000 employers. The rest goes to self-insured programs.

Because EICON will be competing with other firms for the first time in its 86-year history, the company is expected to lose 50 percent to 65 percent of its business. Up to 600 employees could be laid off. And those who remain with the company would lose civil service protections.

SB37 proposes to buy out workers who want to retire early, set aside $2 million for retraining, give priority to laid-off EICON employees seeking other state jobs and allow agencies under a hiring freeze to employ the former EICON workers. The bill also gives employees the right to be placed on a priority list for other state positions for three years.