(Sean Whaley/Nevada News Bureau) – While some critics may never be convinced that Gov. Brian Sandoval should have agreed to support new tax revenue to balance the budget, the collection of reforms approved as part of the deal finalized this morning cannot be ignored.
From changes to Nevada’s collective bargain law allowing the reopening of labor agreements in emergencies to limiting teacher tenure to eliminating health insurance for newly hired state employees upon retirement – the changes approved in the 120-day legislative session by Democrats and Republicans could have far reaching impacts.
Ray Bacon, executive director of the Nevada Manufacturers Association and a long-time advocate for reform to Nevada’s public education system, said it will take time to see the effects of the changes, which also include making the state superintendent of public instruction answerable to the governor rather than an elected board.
“It’s going to take a while to see real change in this thing but I believe we’re going to see real change in K-12 performance,” he said. “Could we have done more on improving the education reform and improving the public employee benefit changes, sure. But given the makeup of the two houses, quite frankly I’m pretty well stunned with what we did get.”
Senate Minority Leader Mike McGinness, R-Fallon, made note of the reforms in announcing his support of the tax extension bill on the Senate floor on Monday: “We’ll pass performance-based budgeting, collective bargaining and employee benefit reforms that will put our state on a path to fiscal sustainability.
“We also stressed this session the need for education system reforms that really does put our children first, education reforms that represent a shift in the right direction,” he said. “I’m not saying these reforms are the end all. They are a good start and I’m confident in the next session I leave behind some capable colleagues that will continue in these efforts.”
Not everybody is convinced that the reforms will result in real change.
Sen. Barbara Cegavske, R-Las Vegas, said on the Senate floor during the tax bill debate: “I don’t believe the concessions my colleagues made on the other side of the aisle will improve public education.”
Victor Joecks, communications director of the Nevada Policy Research Institute, a conservative think tank, called the education reforms minor and said they will have minimal impact on increasing student achievement in Nevada.
“This differs from the governor’s original reform package, which included one-year contracts for teachers, vouchers and ending social promotion,” he said in a commentary.
There are those who wish more could have been done. Sandoval wanted to make a fundamental change to the public employees’ retirement system, but instead won only a study of the issue. While strongly supporting a change to the state constitution to allow a school voucher program, no progress was made on the issue in the 2011 session.
An effort to make some reforms to the state’s home construction defect laws failed when a bill failed to win passage in the Senate in the waning hours of the session. Supporters of reform in this area hailed the failure as a victory, however, calling Assembly Bill 401 no reform at all.
And in what could be called tax reform, the extension of business taxes and other levies that will bring in over $600 million in the next two years included the complete elimination of payroll taxes on Nevada’s 115,281 small businesses. Small businesses pay a 0.5 percent tax rate on their payrolls currently.
The Las Vegas Chamber of Commerce and other groups had sought reforms to education and public employee benefits this session in exchange for consideration of any additional revenues to fund the budget.
Democrats also sought reforms. Assembly Speaker John Oceguera, D-Las Vegas, sponsored the bill seeking to restrict attorneys’ fees and reduce filing times for lawsuits in residential construction defects law. The construction industry dismissed the measure as inadequate, however, and argued for its defeat.
Oceguera took issue with the characterization of his bill, saying at a committee hearing that he worked with the construction industry to draft his bill.
“I asked for a list of the five most important things,” Oceguera said. “The three that are in this bill are the top three that you gave to me. So to say these aren’t important issues is disingenuous at least. These are the issues you told me you wanted to work on, and we worked on.”
But the Senate on Monday, sent the measure to defeat on a 12-9 vote.
The performance based budgeting bill, which has been signed into law by Sandoval, was sought by Oceguera and Assemblywoman Debbie Smith, D-Sparks.
The decision to support extending taxes came after a Nevada Supreme Court decision put into question a number of funding mechanisms proposed by Sandoval to balance the two-year budget that will begin July 1. While the ramifications of the decision were not entirely clear, Sandoval reluctantly opted to replace some local revenues proposed for his budget with the business and sales tax extensions.
The reforms were a requirement for his and Republican lawmaker support of the added revenues.
The reforms passed by the Nevada Legislature will:
- Place teachers who receive two years of negative evaluations back on probationary status.
- End the seniority system in school district lay-offs. Other factors, including performance and effectiveness, must now be included.
- Change collective bargaining for local government employees. Agreements will be re-opened during times of fiscal emergency and supervisory employees will not be allowed to collectively bargain.
- Allow the governor to appoint the state superintendent of public instruction. A new state board will also have members appointed by the governor and legislative leaders, as well as four members elected by the people of Nevada.
- Save an estimated $275 million over the next 30 years by removing eligibility of newly hired state employees for health insurance benefits during retirement under the Public Employee Benefit Plan, effective January 1, 2012.
- Conduct a complete analysis of PERS in order to give the 2013 Legislature and the governor information they need to address unfunded liability. The study must include recommendations with actuarially-sound alternatives.