Special session called to roll back raises

Gov. Jim Gibbons said Friday he will call a special legislative session to take back the 4 percent cost of living raises state employees and teachers are scheduled to receive July 1.

The session is to begin June 23 and last for up to five days.

He said he discussed the decision with Senate Majority Leader Bill Raggio, R-Reno, and that Raggio agreed with him.

"On reflection, I have come to believe that deferring the scheduled (cost-of-living-adjustments) until the next legislative session is an important tool that will enable us to handle this budget crisis while avoiding painful layoffs, and only the Legislature can authorize that action," the governor's office quoted Raggio as saying.

Raggio said he changed his mind about holding a special session after talking with fiscal staff who told him the final additional shortfall was likely to be significantly higher than the $60 million announced at Thursday's meeting. But instead of eliminating the raises, Raggio said he has asked for a bill draft that would delay them for a year in hopes lawmakers and the governor can find the necessary money.

"It's difficult to support pay increases if you're going to have to lay off people," Raggio said. "I would rather save jobs than have the pay raises go in."

He rejected the alternative of raising taxes and fees saying, "I'm not going to advocate tax increases at this time when we're in a near-recession."

That's a 180-degree change from what Raggio said as he exited the meeting with the governor Thursday. He also said then that a special session would not be needed because the necessary budget cuts could be made through the Interim Finance Committee.

At the Thursday meeting, only Assembly Minority Leader Heidi Gansert, R-Reno, supported the idea of taking back the raises.

Taking back the pay raises would save upwards of $130 million in the coming fiscal year " more than double the $60 million increase in the shortfall reported to the governor and lawmakers Thursday. That $60 million increase brings the total shortfall for this biennium to more than $970 million. Fiscal experts say it could reach $1 billion by the end of the month.

The news of a special session came as a shock to legislative leaders who complained during the Thursday meeting they were not advised about that budget meeting until less than a day before the announcement was made.

Assembly Ways and Means Chairman Morse Arberry angrily charged that any proposal to call a special session and take back employee raises should have been discussed Thursday.

"We just met yesterday and there was nothing about a special session on the table. I feel blind-sided, and I don't appreciate it at all," Arberry said. "We should have talked about that yesterday."

Arberry said he was especially angered that the governor's office didn't notify him of the decision. He said he and other Democrats found out when news reporters began calling for comment.

"I might not be supporting going in and taking away the raises from teachers and state workers," he said.

"I think the governor is acting like one of our bipolar clients," said Assemblywoman Sheila Leslie, D-Reno, who works with the Washoe County mental health courts.

"I feel insulted with the charade of that meeting yesterday. To me, clearly this is an attempt to change the conversation from the governor's turbulent personal life."

Assembly Speaker Barbara Buckley, D-Las Vegas, said taking back the raises will be especially hard on the school districts since contracts that include those raises have already been negotiated, which means the cuts will have to come out of the classroom funding.

"The superintendents are telling me they're going to consider cost savings such as four-day school weeks or having students pay for transportation," she said. "Wait until parents hear about that."

Buckley said the way budget cuts should be handled is to "identify the problem, propose a solution then start developing a consensus."

"Then the governor calls a special session," she said.

She said the result could be a lengthy and costly special session at a time when the state doesn't need to spend that money.

"I'm convinced the only reason the special session is being called is to change the subject," she said. "He's tired of stories about his text-life."

Leslie charged that Gibbons is abdicating his responsibility to manage the budget.

"So the Legislature is going to have to fill the void," she said.

Senate Minority Leader Steven Horsford, D-Las Vegas, said the unilateral action is more politics than solutions.

"Rather than offer a solution that balances the budget responsibly through the Interim Finance Committee process, they propose to waste taxpayer dollars by calling for a special session," he said in a statement.

Sen. Bob Beers, R-Las Vegas, however, said he supports the decision.

"We are to the point where the choice is to give substantial pay increases, totaling nearly 10 percent for most public employees, or lay some public employees off," he said in a release. "Nevada citizens are best served by not laying public employees off if we can avoid it."

Lorne Malkiewich, director of the Legislative Counsel Bureau, said the first day of a special session will cost about $100,000. Each day afterward, he said, will cost about $50,000.

Under state law, incumbent state candidates are barred from seeking or taking campaign contributions from the day after the executive order calling the special session is issued until 15 days after that session ends. Gibbons is expected to issue that order a day or two before the beginning of the special session. But the fund raising restrictions and the fact incumbent lawmakers will be in Carson City and off the campaign trail during session makes the idea of a special session less than popular.

That rule, however, wouldn't apply to candidates such as Senate Minority Leader Dina Titus, D-Las Vegas, who is running for Congress and governed by federal campaign rules.

- Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.