Settlement may end NLV case with a whimper

When last we checked in with the financially strapped city of North Las Vegas in 2012, it was suspending collective bargaining agreements with public safety agencies under a highly questionable interpretation of state law that was ripe for overturning by the courts.

But now, it seems, we may never know who was right and who was wrong.

Last summer, the city approved a resolution declaring a financial emergency. Not too many people argued with that; deficits were high, recession-wracked revenues were low, and city leaders were blaming union contracts.

But what North Las Vegas did next was certainly arguable: Citing a state law that allowed the suspension of the collectively bargained contracts in the event of “riot, military action, natural disaster or civil disorder,” the city unilaterally imposed a suspension of some contract terms.

Unions sued, under the perfectly understandable grounds that there simply was no riot, military action, natural disaster or civil disorder. (At least not yet!)

Then came the 2013 Legislature, when two significant things happened: A new formula for distributing tax dollars was adopted, over the pointed objections of outgoing North Las Vegas Mayor Shari Buck. And Assembly Bill 503 was passed, allowing the city to borrow or transfer funds from its enterprise accounts (for example, the sewer fund).

Under the bill, the money can be used to restore police services, restore libraries, parks and other recreational services and to settle any outstanding legal claims, in that order.

And one of those legal claims is the union’s lawsuit against the city’s Hail Mary resolution, which is steadily progressing toward an all-but-inevitable court slapdown.

North Las Vegas Firefighters Association President Jeff Hurley confirms that unions for cops and firefighters are in talks to settle the lawsuit against the city, rather than fight it to its conclusion. Hurley reasons that even if the union wins, and the city is forced to abide by the terms of the improperly suspended contracts, the union still loses, because the city would blame firefighters and cops for the resulting financial chaos. He says it’s more important at this point to get public safety personnel back on the job.

“At the end of the day, what do you win?” Hurley said. “It [the resolution] has put us in a really bad spot.”

Although the city is apparently negotiating to end the lawsuit, it certainly isn’t abandoning its novel interpretation of state law. If anything, officials have doubled down, passing a follow-up resolution last week that continues the declaration of emergency and the suspension of contract terms. The 11-page resolution is a detailed accounting of the city’s hard times and reasons why labor costs must yield. (Not on that list are the city’s questionable decisions to build a new City Hall and sewage treatment plant — projects that cost taxpayers $370 million.)

There are reasons to hope that things might be improving for North Las Vegas, although there’s still an $18.8 million deficit. For one, Buck was tossed by voters in favor of ex-state Sen. John Lee, who pledges to bring more businesses to the city. The new tax-distribution formula might help. The state’s unemployment rate is slowly falling. And the notion that the city’s emergency powers gambit was simply a bid to stall for time and hope for a better financial picture doesn’t seem too far-fetched.

But a potential settlement of the union lawsuit is somewhat disappointing because we may never know for sure whether the city’s desperate maneuver was legal or not. A 2013 attorney general’s opinion concluded the state Taxation Department couldn’t suspend union contracts in the event of a state takeover of the troubled city, so it’s hard to see how a judge could rule the city possesses powers that the state does not.

As long as that remains an open question, Nevada’s local governments may entertain the idea of claiming emergency powers rather than continuing to negotiate with unions until they arrive at mutually agreeable concessions.

Steve Sebelius is a Las Vegas Review-Journal political columnist and author of the blog SlashPolitics.com. Follow him on Twitter (@SteveSebelius) or reach him at (702) 387-5276 or ssebelius@ reviewjournal.com.