Las Vegas Metro still refusing to pay retiree benefits subsidy
November 21, 2008
The Las Vegas Metropolitan Police Department is still ignoring a Nevada Supreme Court ruling that ordered them to pay a subsidy for their retirees who joined the state benefits program.
Leslie Johnstone, director of the Public Employee Benefits Program, will present the issue to the Las Vegas Metro Fiscal Affairs Committee on Monday, asking them to direct the department to comply with the ruling and pay up.
The Nevada Legislature mandated in 2003 that local governments and school districts provide their retirees who join the benefits program at least the same subsidy the state provides for its retirees. They did so after retirees from Metro as well as several school districts complained about the extremely high premiums they must pay compared to state retirees.
Metro argued it was exempt from that law because its benefits are provided by a trust and negotiated in collective bargaining. But their lobbyist was told by Sen. Bob Beers, R-Las Vegas, during hearings on the subsidy that it wasn’t a question of whether Metro would end up paying but when. Beers later said the law was clearly intended to cover Metro as well as the school districts.
Metro won a ruling in its favor from Clark County District Judge Mark Denton but the Public Employee Benefits Program appealed to the Supreme Court.
The court in March unanimously rejected Metro’s arguments and ordered the department to pay the subsidy.
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According to Public Employee Benefits Program Director Leslie Johnstone, Metro paid about $400,000 of the tab, but then stalled, refusing to pay and again arguing they shouldn’t have to despite the law and the Supreme Court ruling upholding it.
She said the Public Employee Benefits Program has been covering the subsidy so that retirees don’t have to pay the full premium and, as a result, Metro now owes the state about $1.6 million for the 287 retirees in the state program. Most of those retirees joined the benefits program because they moved to places where Metro’s retiree benefits program isn’t available.
“They’re not paying their share of the subsidy,” she said Friday. “We kept taking these people in good faith, and they kept signing up in good faith.”
She said the battle has been going on now for five years.
The law allowing other public entities to have their employees and retirees join the program was originally passed to provide for local governments and school districts too small to get a decent benefits plan at a reasonable rate. A number of them are members. For both active and retired employees.
As of March when the high court ruling came out, there were about 3,500 non-state retirees in the plan ” 1,900 of them from the Clark County School District. Johnstone said that number has grown considerably because of another law which took effect in October. That law says after that date, the only retirees who can join are those who’s active employees are covered by the Public Employee Benefits Program.
Other governmental groups whose retirees have joined the program, including Clark County firefighters and several school districts are paying their subsidies.
– Contact reporter Geoff Dornan at email@example.com or 687-8750.