Motion to convert bill into study of subsidizing state retiree benefits fails

Democratic pleas to study rather than end benefit subsidies for future state retirees fell to a party-line vote in the Senate on Tuesday.

Only Carson City Republican Mark Amodei broke ranks and supported turning SB484 into a study. The bill was proposed by Gov. Kenny Guinn who said the state has a huge unfunded liability because it must pay benefit subsidies to retirees. The bill would change the law so that state employees hired after July 1, 2006, would not get that subsidy when they retire 20 or more years from now.

He said all current employees would still get the subsidy.

"Very little detail was presented about the potential consequences of dropping health coverage for retirees," said Minority Leader Dina Titus, D-Las Vegas. She agreed the potential liability and its possible effect on the state's finances and bond rating need to be addressed.

"But we believe it should be thoroughly vetted," she said.

She said that hasn't been done so the bill should be converted into a study. The results would be presented to the 2007 Legislature for a decision.

Majority Leader Bill Raggio, R-Reno, opposed the amendment saying few in private industry and very few in other Nevada governmental entities receive benefit subsidies after retirement.

He said the study would only delay what must be done.

Sen. Bob Coffin, D-Las Vegas, urged members of the Senate to adopt the amendment saying he agrees something must be done but that the governor's plan won't win Assembly support and that will just leave the issue hanging for two years.

"I suspect the other side of this building would reject the bill wholesale and that's where we don't want to be so a study seems very appropriate," he said.

The amendment failed by a 10-11 vote.

Titus followed that with an amendment to have state and local governments contributed to deferred compensation plans for those workers so they could build up some funding to pay benefit costs after retirement. Raggio again led the opposition saying that could end up costing the state $125 million over the next 20 years.

Again, the vote was 10-11 to reject the amendment - again with Amodei joining the Democrats in support of the proposal.

The vote on the bill itself will be held today.