Chamber, unions clash on government pay, perks

By J. Patrick Coolican (contact)

Thursday, Feb. 26, 2009 | 2 a.m.

The Las Vegas Chamber of Commerce is like the kid who taunts the barking, chained-up dogs in the neighborhood.

For months, the group has attacked the public employee retirement and health benefits system, as well as local government pay. With the state in fiscal crisis, the powerful business lobby has agreed to consider tax increases, but only if local government unions feel some pain.

Well, those chained-up dogs — the government unions — were let off their leashes Wednesday at a lengthy but often riveting hearing here.

State Sen. John Lee, a conservative Democrat from North Las Vegas who heads the Government Affairs Committee, plans to draft a bill on the issue of pay and benefits for government employees, and held an open hearing to begin the process.

Lee said he hoped everyone would work together to find solutions and “forgo sophistry,” after which the sophistry — from both sides — began in earnest.

First up, the chamber’s numbers guy, Jeremy Aguero of the firm Applied Analysis.

Aguero is considered a sage in Nevada public policy circles — the goateed, longish-haired man with the data.

His record of analysis in recent years has been mixed.

Here he is on the economy, a year ago: “We’re merely at the bottom of one cycle and heading back up on another one.”

Still, the committee was eager to hear his testimony, which was detailed, though disputed by union testimony.

• Public employees make 28 percent more than their private sector counterparts. (A union analyst later testified that the chamber study was dishonest for, among other reasons, not including true tip income. The chamber had casino dealers making $14,000, which seems off and would obviously drag down private sector averages.)

• State employees make about the national average, though teachers make about 7 percent less than the national average and local government employees make 131 percent of the national average.

At various points, Senate Minority Leader Bill Raggio, the Reno Republican with nearly four decades in the upper chamber, broke in. His forehead clearly displayed the mark of the Catholic holy day Ash Wednesday, which made his usually imposing presence all the more so.

“All of us get e-mails and blogs, or whatever they are,” he said. Raggio is likely not roaming the Internet, but still, he’s very aware that he’s been attacked as soft on tax increases by conservative firebrands online.

So several times he made a point about the stinginess of Nevada government.

He cited a Tax Foundation study showing Nevada is 50th in the country in public employees per capita. Aguero conceded Raggio’s points and continued on.

• The state gives workers with as few as five years service a health care subsidy when they retire, which has led to a $4 billion unfunded liability.

• The retirement system, he said, has an unfunded liability of $6 billion. The chamber notes that Nevada’s contribution rates of 20.5 percent of salary for regular employees and 33.5 percent of salary for fire and police — the amount it must set aside to fund the retirement program — rank near the top nationally.

When the chamber presentation was finished, up stepped teachers, firefighters and police, and the crowd murmured.

As an opening salvo, police and firefighters have been buying newspaper ads telling readers how much executives at the chamber make.

David Kallas, representing the Police Protective Association, in a three-piece suit, his hair flecked with suspicious streaks of blond, oozed contempt.

“I’d like to pose a rhetorical question: Why are we here in the first place?” he said. Never has a special interest group like the Chamber of Commerce been allowed to dominate a policy process like this one, Kallas charged, although that seemed a little naive.

“Who died and made the Chamber of Commerce our conscience?” he said.

“Who caused this mess?” he said, before going on a populist tour of the Evil Capitalist Kingdom — Enron, subprime lenders, Merrill Lynch and Lehman Bros., Nevada banks with their hands out for federal bailout money, etc.

“What do those groups all have in common? They’re all members of the Chamber of Commerce.”

Even Steve Hill, the chamber president, had to laugh heartily at that.

Rusty McAllister of the firefighters was next.

“Phew,” he said.

McAllister gave a bravura performance, invoking the heroism of the Monte Carlo fire, saving babies from swimming pools, pulling moms out of wrecked cars.

Just today, they cleaned up a giant chemical spill in Las Vegas, he said.

“Nobody’s out there saying we’re overpaid today,” he said.

The unions said the chamber analysis was flawed because Nevada employees don’t participate in Social Security, which means state government doesn’t have to pay into the system and thus saves itself a considerable amount. If that were factored in, Nevada benefits would actually be less generous than average, they said.

Danny Thompson, the head of the AFL-CIO and its 200,000 workers, was blunt in his criticism of the business lobby.

“This isn’t about PERS,” he said, referring to the retirement system. “This is really about taxes. This is really about the Chamber of Commerce not wanting to pay taxes.”

Maybe so, but this fight is on.