Minimum Wage/Overtime
There is a critical hearing April 17, at 1:30 p.m. in the Assembly Commerce Committee on a bill that would raise the minimum wage—but fix overtime.
Senate Bill193 passed by a party-line vote in its chamber, and now starts its Assembly journey.
The bill would finally fix Nevada’s antiquated overtime law by removing the provisions that requires overtime be paid after eight hours in a 24-hour period, and it would get rid of the 24-hour clock. This has been something NFIB has been lobbying for the past two sessions, and we are thrilled with this part of the bill.
The downside of SB 193 is that it was amended to increase the state’s minimum-wage rate to $9 an hour from its current $7.25, if the employer does not offer health insurance to that employee.
NFIB is working to remove the minimum-wage provision in this bill, or at least provide for an exemption for tipped employees, while at the same time supporting the change to overtime.
Tax Bills
The last few weeks, more than 60 NFIB members have sent an email to their senators opposing Senate Bill 252, the Gov. Brian Sandoval’s Business License Fee (BLF) plan.
The bill passed the Senate Revenue Committee on a 4-to-3, party-line vote, with Republicans supporting and the Dems opposing. The governor argues that the tax in vital to improving education. As of this report, Senate Majority Michael Roberson cannot get the two-thirds votes necessary to move SB 252 forward, so it will sit on the chief clerk’s desk for a while. Prognosis: It is doubtful the tax will pass at this point.
Meanwhile, the other tax alternative, Assembly Bill 464, is still alive. Sponsored by Derek Armstrong, chairman of the Assembly Taxation Committee, and Majority Leader Paul Anderson, chairman of Ways and Means Committee, the bill would increase the Business License Fee to a flat $300 for small businesses and $500 for larger corporations, and then increase payroll taxes to 1.56 percent for everyone, with no write off for health care.
The first $50,000 of payroll per quarter would be exempt from the tax. The tax would actually be a reduction for banks and financial institutes as they pay 2 percent now. The bank-branch fee would also dropped.
At an April 7 hearing on the bill, support was split, most of the business community was in favor of it, gaming was opposed, and the chambers of commerce and NFIB being neutral.
It seems inevitable, however, that a tax will pass, so NFIB is working to make it the least offensive tax. AB464 is less onerous than the governor’s proposal, but NFIB still cannot back it.
Education Reforms
The Legislature seems hell bent on raising taxes to provide more funding for education, and it appears it is equally hell bent on making changes to our education system to ensure that money is well spent and will actually improve the system.
We live in a state where our major industry, gaming, didn’t really need an educated workforce, so a strong education system has not been a big priority. But as gambling grew across the country, and gaming tax revenue started to decline, state leaders realized that they had to diversify our economy and create new industries to make up for the loss of jobs and tax revenue from gaming. Thus, creating an educated workforce is now a priority.
So we’re playing catch-up and trying to improve education. But just increasing spending won’t do the job when you have a system that has historically not been asked or expected to produce a high quality product.
There are some good bills in the Legislature that should help improve education. Many education reform experts say that school choice is a key to improving education, and there are several bills addressing that this session.
- Assembly Bill 165, which the Governor has signed, gives business’ credit on their payroll tax if they donate funds to an organization that awards scholarships to low-income students. Proponents say the measure would help students leave lower-achieving schools and attend one of the approximately 200 private schools in the state that might be too expensive for their family.
- Assembly Bill 448 creates an Achievement School District at the state level, which would turn under-performing schools into achievement charter schools.
- Senate Bill 302 would allow a child enrolled in a private school to receive up to 90 percent of the funds that are dedicated to each student to be used at any school of their choice. In short, the money should follow the student.
- Senate Bill 92 would help hire and keep good teachers. There is a general consensus (and lots of research to back it up) that improving the effectiveness of teachers is the key to lifting student achievement. Education researcher Eric Hanushek has data that say replacing the bottom 5 percent to 8 percent of our teachers with just average teachers would move students’ achievement up to that of Canada’s, which ranks much higher than U.S., year after year. Principals and administrators need flexibility to fire bad teachers, but teacher tenure and seniority are sacred to unions. SB 92 would allow school boards to consider a variety of factors, not just seniority, when a reduction in the workforce is necessary. It would also change the probationary period and requirements for underperforming teachers.
What’s more important: protecting the rights of teachers who are never going to be good teachers, or protecting the rights of students who need good teachers to succeed?
PERS/Collective Bargaining
Led by Assemblyman Randy Kirner, two of the most sacred issues at the Legislature, collective bargaining and public employee pension reform, are being scrutinized.
Kirner wants to fix the Public Employees Retirement System’s unfunded liability that is estimated at more than $12 Billion.
Kirner’s Assembly Bill 190 would establish a hybrid retirement program for new public employees who start after July 1, 2016. So the program would include a defined benefit plan and a defined contribution plan. It would put a cap on annual benefits and prohibit the purchase of “years of service,” which is a huge issue. (Employees can buy a year or more of service, which increases their annual pension payout, often at a huge payout for minimum input.)
The room is full of public employees who are adamant about protecting their system, despite the reality that the system is in trouble and will likely need a taxpayer bailout at some point in the future. NFIB applauds Kirner for his dedication to tackle this issue and is fully supporting his efforts.
Another measure that has public employee unions calling this the “Union Armageddon Session,” is Assembly Bill 182. It would:
- prohibit a local government employer from paying union dues through deductions from an employee’s paycheck
- prohibit an employer from providing paid leave or paying compensation or benefits for time spent by an employee in doing union work
- and prohibit managers from being included in bargaining units.
There is another bill addressing the issue of whether felons should be able to receive their pensions. That issue has received a lot of attention after numerous media accounts have told the stories of folks like Las Vegas Judge Steven Jones, who is going to prison for abuse of judicial powers. Even though he’s going to prison, he’ll be able to collect up to 75 percent of his $200,000 a year salary as a judicial pension, at some point. So SB406 is trying to address that issue.
Assembly Bill 280 would allow for collective bargaining agreements to expire at the end of the term stated in the agreement. Currently, the existing agreement stays into affect until a new one is agreed upon. Assembly Bill 249 and Senate Bill158 would require that a local government union agreement be approved at a public hearing.
All of these bills have a good shot of passing and are critical to our state’s financial stability.
Upcoming Important Date
April 21 is the deadline for bills having to pass out of their house of origin.
