2009 State Legislature

2009 Legislative Session:

PERS/PEBP/Local Government Reform Bill

PASSED Senate Bill 427

Revises provisions governing public employees The Las Vegas Chamber worked hard to achieve comprehensive reforms to the Public Employees’ Retirement System (PERS), Public Employees’ Benefits Program (PEBP), and the local government public employee collective bargaining process. We were successful when lawmakers agreed to make several important changes to PERS and PEPB, as well as bring more transparency and accountability to the collective bargaining process. The specific reforms that have been agreed to in the bill are as follows:

PERS:

Increases the number of years of service required for firefighters and police to retire at any age from 25 years to 30 years
Increases the retirement age required to retire without penalty Increases the early retirement penalty from 4 percent to 6 percent per year
Reduces the benefit factor from 2.67 to 2.50, adding 2 years to the number of years required to fully vest Reduces the ability to take advantage of the system by controlling spikes in compensation for the 5 years before retirement through capping the annual increase in pay at 10 percent (excluding promotion and assignment related raises)
Lowers the cap on Cost of Living Adjustments (COLA) for retirees

PEBP:

Increases number of years required to begin vesting in program from 5 to 15 years of service for new public employees
Requires retirees to be continuously enrolled in PEBP immediately upon retirement to receive benefit, eliminating adverse selection issues

Local Government:

Brings fairness to the collective bargaining process by changing the law so fact finder must consider a comparison with state employee compensation
Must consider the local government’s ability to pay for life of contract
Brings transparency to collective bargaining process by requiring a full fiscal hearing before elected officials vote on a contract

These changes will bring improved transparency to public employees' pay and benefit contracts, and help contain the growing multi-billion dollar unfunded liability, helping to put our state on a fiscally-sustainable path.

The passage of this key piece of legislation is in large part due to your support and the hundreds of letters you sent to our state legislators in response to our Calls to Action.

The Governor approved SB 427 on June 3. (Sections 5 and 17 effective June 3, 2009. Sections 1 to 4.7, inclusive, and 6 to 16, inclusive effective January 1, 2010.)

Revenue Bill

PASSED SB 429:

Provides additional revenue for the provision of governmental services As the extent of Nevada’s economic crisis became clear last December, the Chamber recognized that additional revenue might have to be raised to help our state provide basic services to its citizens. Before asking taxpayers for more money however, lawmakers would have to address areas of significant reform. The Chamber said that if businesses were being asked to pay more, then lawmakers should be equally committed to enacting reform that would prevent future fiscal crises caused by ballooning public employee pay and benefits. The Chamber worked hard to ensure that any increase in taxes was as broad-based as possible in order to mitigate the impact taxes would have on already struggling businesses. In fact, the Chamber supported a tax decrease on small businesses.

This bill lowers the Modified Business Tax (MBT), or payroll tax, rate from 0.63 percent to 0.5 percent for the first $250,000 of annual payroll for all businesses. The Legislature estimates more than half of all Nevada businesses have payrolls of less than $250,000. The MBT will rise from 0.63 percent to 1.17 percent for every dollar of payroll in excess of $250,000. This increase goes into effect July 1, 2009 and expires by limitation on June 30, 2011
In addition, the Local School Support Tax (LSST), a component of sales tax, will increase by 0.35 percent. This will be in effect beginning July 1, 2009
The Business License Fee, which is currently $100 a year, will increase to $200 per year. This is effective July 1, 2009 and expires on June 30, 2011 by limitation
Lawmakers also reduced the depreciation schedule for motor vehicles, as well as increasing the minimum registration tax on vehicles older than nine years. This becomes effective September 1, 2009

Workers' Compensation Bills

PASSED Assembly Bill 24

Revises provisions governing claims for compensation under industrial insurance

The original contents of this bill were amended into AB 281. Instead, AB 24 was transformed into a bill to address the handling of claims for catastrophic injuries. The bill defines such injuries, provides for the development of a life-care plan, and requires the Administrator of the Division of Industrial Relations to develop regulations concerning such plans as well as the qualifications and experience of claims adjustors who may handle catastrophic injury claims.
The Governor approved this bill on June 9.

(Effective June 9, 2009, for the purpose of adopting regulations and October 1, 2009, for all other purposes.)

PASSED AB 173

Makes various changes relating to occupational diseases

This bill provides that diseases of the heart and lung are occupational diseases of fire arson investigators. AB 173 indirectly impacts business because it increases public sector costs and long-term liabilities, which are then passed on to taxpayers. AB 173 was approved by the Governor on May 22 and becomes effective October 1, 2009.

PASSED AB 178

Makes various changes to provisions relating to industrial insurance

As originally written, AB 178 contained a long list of changes to the workers’ compensation system that would significantly raise costs for businesses, school districts, and local governments. The Chamber and a broad coalition of business and local governments worked hard to amend AB 178 to minimize the negative impact on businesses, and as a result, most of the costly provisions of AB 178 were removed or seriously modified to severely reduce their impact. These modified provisions were included in SB 195, which became the vehicle for the results of the compromise negotiations relating to workers’ compensation. This compromise fixed several problems in the handling of worker issues without altering the key principles of Nevada’s cost-effective system.

PASSED AB 281

Makes various changes concerning workers’ compensation

In its original form, AB 281 authorized certain contested claims relating to certain occupational diseases of police officers, firefighters and emergency medical attendants to be submitted directly to an appeals officer. The favorably amended contents of AB 24 as introduced were then added to AB 281. AB 24 initially made it much easier to reopen claims, but this problem was eliminated in the final version as passed.

PASSED AB 410

Makes various changes concerning workers' compensation

This bill allows the provisions of collective bargaining agreements between certain employers and the labor organizations that represent their employees to supersede various statutory provisions relating to industrial insurance. Such collective bargaining agreements may include provisions which establish processes for alternative dispute resolution, lists of medical evaluators and providers of medical treatment, joint safety committees, programs for light-duty or modified job responsibilities and programs for vocational rehabilitation. However, this bill was solely targeted at the construction industry, which believes that this bill will be an effective cost-cutting mechanism. As a result, the Chamber deferred to the industry to support and pass the bill.
AB 410 passed both houses, yet was vetoed by the Governor. Both the Assembly and the Senate overrode the Governor’s veto and the bill will become law.

DEFEATED AB 511

Revises industrial insurance provisions relating to insurers and third-party administrators

As originally written, AB 511 eliminated Nevada’s no-fault workers’ compensation system as a sole remedy and permitted lawsuits against insurers and third-party administrators, which undoubtedly would have resulted in a significant rise in lawsuits against insurers and employers. Consequently, the insurance rates and litigation costs of business would have increased. Self-insured groups, such as school districts, would have had to face a decision of whether to spend money on insurance and legal fees or books for the classroom. As part of the overall workers’ compensation compromise, its backers abandoned AB 511, and it died.

PASSED AB 521

Revises provisions governing coverage for cancer as an occupational disease of firefighters

This bill extends workers’ compensation to cover new types of cancer for firefighters and reduces the required number of years of service from five to two for firefighters to receive compensation. The bill also requires additional testing for certain medical conditions. This bill will likely cause insurance companies to discontinue offering coverage for these types of claims because of their frequency and cost. If insurance companies discontinue coverage, local governments will have to pay the significantly higher costs, which will result in a diversion of funds from other important areas. Also, for these types of presumptive benefits to be issued, there should be scientific evidence showing a correlation between the work and the injury. Currently, there is no proof that the rate of these cancers is higher among firefighters than among the general public. Finally, the Chamber considered this bill unnecessary, due to the fact that firefighters already receive healthcare coverage for these illnesses.
AB 521 passed through both houses and the Governor approved it June 9. (Effective July 1, 2009)

PASSED SB 195

Revises provisions governing workers' compensation

SB 195 requires Nevada to use the Fifth Edition, rather than the most recent edition, of the American Medical Association’s Guides to the Evaluation of Permanent Impairment.
SB 195 became the vehicle for the provisions agreed upon during the compromise negotiations. The compromise bill continued to limit compensation to “physical impairment” except for stress that stems from a single traumatic accident. Several other issues relating to claims handling and hearings were addressed, but most importantly the key provisions of Nevada’s cost-effective workers’ compensation system were preserved.
Although SB 195, as passed, was mutually agreed upon by all stakeholders involved, the Governor vetoed the bill. However, both the Assembly and Senate overrode the Governor’s veto and the bill will now become law.

DEFEATED SB 324

Revises provisions relating to industrial insurance

This bill provided for catastrophic case breakout and doubled the benefit penalty in serious cases. This bill failed to meet the first committee passage deadline, and died as a result. However, AB 24, as passed, addresses this issue in a more balanced way.

PASSED SB 363

Revises provisions relating to death benefits paid to surviving spouses under industrial insurance I

In 2007, fire and police officers were exempted from the requirement that a death benefit under industrial insurance ceases upon remarriage of the spouse.
SB 363 eliminated that requirement from the workers' compensation statutes, effectively allowing the exemption for all employees. This bill expanded the scope of workers' compensation beyond what it was intended to be and allowed the system to mirror a life insurance policy, rather than compensation for a worker's injury or death. SB 363 was passed by both houses, and then was vetoed by the Governor. Both houses then overrode the Governor’s veto to allow the bill to become law.

DEFEATED SB 366

Revises provisions relating to workers' compensation

In order to receive workers’ compensation, existing law puts the burden of proof on an employee to prove that his or her injury occurred at work. SB 366 would have shifted the burden of proof to the employer and provided that an employee would be entitled to receive workers’ comp, unless his employer proved the injury did not occur at work.
Chamber lobbying and testimony helped defeat the bill in Senate Commerce and Labor. As part of the compromise agreement reflected in SB 195, its proponents agreed not to bring this concept back in another bill.

Collective Bargaining Bills

DEFEATED AB 130

Revises provisions governing metropolitan police departments

This bill made changes to the bargaining process for the Metropolitan Police Department. Currently there is a Fiscal Affairs Division consisting of two members from each of the participating local governments. Bargaining for LVMPD currently takes place between the representatives from the police dept. (the sheriff) and the members of the Fiscal Affairs Committee. This changed the bargaining process to be exclusively between labor and the sheriff (or one or more representatives designated by him). Each participating municipality is only allowed to monitor the negotiations. Any tentative agreement reached must be submitted to the Fiscal Affairs Committee for approval. Another major issue of this bill included the changing of the terms of service for members of the Committee. Members in the past have served at the pleasure of the committee. However, this bill placed a finite term of two years on members. Additionally, each governing body would have the right to remove their member from the committee at any time and for any cause. The Governor vetoed the bill June 9.

DEFEATED AB 395

Provides for workplace relations discussions and agreements for certain state employees

AB 395 authorizes workplace relations discussions between the State and certain state employees. The provisions of this bill are very similar to collective bargaining. Terms and conditions of employment that may be negotiated include, without limitation, hours and working conditions, grievances, discipline and discharge, and any other term or condition of employment that does not require an appropriation from the Legislature to be given effect. The Chamber testified in opposition to AB 395 because it limits flexibility and impedes the legislature’s ability to decide what the cost of state government should be. This bill passed both houses, however the Governor vetoed it June 4.

DEFEATED SB 154

Revises provisions governing mandatory bargaining with employees of local government employers

SB 154 would have expanded the scope of mandatory bargaining between a local government employer and a recognized employee organization. Specifically, this bill would have made policies for transfer and reassignment a subject within the scope of mandatory bargaining for all employees instead of just for teachers. Additionally, SB 154 would have further expanded the scope of mandatory bargaining to include any matter “significantly related” to an enumerated subject within the scope of mandatory bargaining, but only upon written request from a recognized employee organization. The Chamber strongly opposed this bill because it directly contradicted the Chamber’s major 2009 legislative objective of reforming employee benefits and pay.
SB 154 failed to meet the second committee passage deadline and died as a result.

DEFEATED AB 22

Revises provisions relating to certain trade practices

AB 22, which contained the language of the former AB 366, would have made it very difficult for businesses to defend themselves against accusations of deceptive trade practices. Generally, this bill changed the situation for a business alleged to have committed a deceptive trade practice from an administrative/investigative governmental process to one that is potentially involving litigation, and potentially even class-action litigation. It significantly changed the current system for dealing with deceptive trade practices and burdened businesses with many increased costs.
AB 22 passed both houses, but was vetoed by the Governor after the Chamber lobbied about the harmful impact and increased burdens this bill would place on businesses. While the Assembly overrode the Governor’s veto, the Senate sustained the veto, so the bill died.

DEFEATED AB 95

Revises certain provisions concerning the investigation and prosecution of unfair trade practices

Sponsored on behalf of the Attorney General, this bill would have authorized the Attorney General to investigate, review and bring an enforcement action against any proposed merger, acquisition or joint venture involving entities engaged in the business of insurance, notwithstanding certain provisions limiting the scope of the Nevada Unfair Trade Practice Act. The Chamber opposed this bill, believing it gave too much authority to the Attorney General.
AB 95 died when it did not come to a vote in the Senate.

PASSED AB 146

Provides for the establishment of a state business portal

AB 146 authorizes the Secretary of State to create an online business tax portal where businesses can pay all of their taxes in a single location. By consolidating all business taxes, this system will increase efficiency, and it will raise revenue by capturing all of the taxes that businesses are currently supposed to be paying. The Chamber supported the concept of this bill, because it increases the State's available funding without raising taxes. We also believe that the convenience of the portal will attract businesses to Las Vegas.
The bill passed both houses, but was vetoed by the Governor. The Assembly and Senate then overrode the Governor’s veto, and the bill will become law.

DEFEATED AB 147

Requires local governments, under certain circumstances, to grant preference to local bidders bidding on certain contracts for goods or services for a temporary period

AB 147 would have temporarily required local governments to grant preference to local bidders when assigning contracts for goods or services. The Chamber testified in general support of the concept, as it is important to stimulate the local economy in these difficult economic times and help local businesses through the downturn.
This bill passed both houses, yet the Governor vetoed the bill. The Assembly overrode the Governor’s veto, but the Senate sustained the veto, so the bill will not become law.

DEFEATED AB 381

Revises various provisions relating to arbitration

This bill provided that certain mandatory arbitration clauses in consumer contracts are unenforceable, to the extent allowed by federal law. Consequently, AB 381 would have restricted the use of arbitration by business, and could result in a major increase in litigation. The Chamber testified and lobbied in opposition to AB 381, citing the efficiency and value of the arbitration system. This bill was passed by both houses, but the Governor vetoed the bill after the Chamber explained the severe impacts on business this bill would have. The Assembly overrode the Governor’s veto, but the Senate sustained the veto, so the bill died.

DEFEATED AB 491

Makes various changes concerning the execution on property of a judgment debtor or defendant AB 491 made changes concerning the execution on property of a judgment debtor or defendant. This bill provided that a certain amount of money held in the bank account of a judgment debtor, which is likely to be exempt from execution, is not subject to a writ of execution or garnishment. Bill collectors feared that AB 491 would have made it more difficult for businesses to collect debts owed to them.
The Assembly had overridden the Governor's veto, but the Senate did not have an opportunity to vote to sustain or override, so the bill died.

PASSED AB 243

Requires certain employers to grant leave to parents, guardians and custodians of children to participate in certain school activities AB 243 will require businesses that employ 50 or more employees, to grant to a child's parent, guardian or custodian, 4 hours of leave from each school year to attend the child's school-related activities or to volunteer at the school in which his or her child is enrolled. AB 243 also prohibits employers from taking retaliatory actions against employees who take the authorized leave. The Chamber supported the general concept of this bill, because parental involvement, and not per-pupil spending, is the most important indicator for whether a child will achieve academic success. Our government affairs team successfully lobbied to reduce this bill's negative effects on business by increasing the notification requirements for employees and by requiring that the period of leave must occur at a mutually agreed-upon time and date. The Chamber also worked to allow employers to avoid paying employees for the missed time. The Chamber also worked with the bill’s sponsor to delay the implementation of the new rules to August 15, 2009.
AB 243 passed through both houses and was approved by the Governor.

DEFEATED AB 458

Revises various provisions relating to funding for public education

AB 458, sponsored by Assembly Speaker Barbara Buckley, would have created an education stabilization account, which would have reserved funds for use in addressing education budget shortfalls. The Chamber supported the concept of this bill, which encompassed one plank of our reform agenda.
The bill passed both houses, but the Governor vetoed the bill. The Assembly then overrode the Governor’s veto, but it died when the Senate failed to override.

DEFEATED SB 330

Enacts the Initiative for a World-Class Education in Nevada

This bill, proposed by Senate Majority Leader Steven Horsford, would have enacted the Initiative for a World-Class Education in Nevada. The Chamber believed that this could be a significant step towards implementing a performance pay for teacher system that would have resulted in rewarding teachers who are measurably improving student performance and the quality of education in our classrooms.
SB 330 did not pass out of the Assembly Education Committee, and therefore never passed the Assembly Floor.

PASSED AB 162

Requires certain policies of health insurance and health care plans to provide coverage for screening for and treatment of autism

AB 162 mandates insurance coverage for autism screening and treatment in certain circumstances. The Chamber understands the heartfelt challenge that autism presents to parents and our community but knew this bill would not be without costs, such as raising insurance rates and making health insurance less affordable for small employers.
This bill passed both houses and was approved by the Governor.

DEFEATED AB 495

Makes various changes to provisions governing professional negligence

AB 495 as introduced would have repealed the 2002 and 2004 medical malpractice reforms. As amended, it removed the $350,000 cap for noneconomic damages in a medical malpractice case if the doctor's conduct was determined to constitute gross negligence. The result of the legislation would likely have been that most medical malpractice lawsuits would have been filed alleging gross negligence. This bill, if passed, would likely have driven up the cost of malpractice insurance, making it more difficult to recruit and retain medical specialists and potentially reducing the quality of health care for Nevadans. The Chamber sent a letter to the Senate Judiciary Committee opposing AB 495, contributing to the bill’s failure to come up for a vote in the Senate Judiciary Committee.

PASSED Senate Concurrent Resolution 37

Providing for the Interim Finance Committee to conduct a review of Nevada’s revenue structure and to provide long-term stabilization of revenue

Specifically, this resolution provides that the Interim Finance Committee shall appoint a Subcommittee to conduct a review of Nevada’s revenue structure and to provide long-term stabilization of revenue. The Subcommittee is required to: (1) Review proposals for broad-based taxes which are fair and equitable; (2) examine strategies for mitigating tax burdens on both businesses and consumers, including reductions, if possible, in existing taxes, both state and local; (3) consider the public’s willingness to have existing taxes be decreased as other tax revenues become available; (4) using current statistical information, propose strategies and recommendations to advance the State of Nevada in nationwide rankings in key quality-of-life areas, including education, health and human services, public safety, economic diversification, job creation, transit and energy use; and (5) develop a quality-of-life vision for the State of Nevada for a 5-year period, a 10-year period and a 20-year period.

PASSED AB 165

Revises the provisions governing the Fund to Stabilize the Operation of the State Government

This bill, sponsored by Speaker Buckley, enlarged and stabilized the state’s Rainy Day Fund. Because it was imperative that the Legislature adopt a set of “best practices” when it comes to writing its biennial budget, the Chamber supported AB 165, which will make the current Budget Stabilization Fund a better tool to confront tough economic times. This was in line with one of the main Chamber priorities.
AB 165 passed both houses and became law.

DEFEATED AB 446

Revises certain requirements for the proposed budget of the Executive Department of the State Government

AB 446 would have revised certain requirements for the proposed budget of the Executive Department of the State. Sponsored by Speaker Barbara Buckley, this bill would have required the budget of each executive agency to include information regarding long-term performance goals and intermediate objectives.
This bill also would have required the posting of certain information on various internet websites maintained by the State. The Chamber supported AB 446, because it mandated the adoption of clear performance indicators, which would have created more fiscal and performance accountability within government. The bill passed both houses, yet was vetoed by the Governor.
The Assembly overrode the Governor’s veto, but the Senate sustained the veto so the bill did not become law.

PASSED SB 283

Revises provisions governing the rights of domestic partners

SB 283 establishes a domestic partnership as a new type of civil contract recognized in the State of Nevada, giving domestic partners essentially the same rights, protections, benefits, responsibilities, obligations and duties as do parties to any other civil contract. The bill also establishes that a partnership is not a marriage under the Nevada Constitution. SB 283 mentions that no public or private employer in this State is required to provide health care benefits to or for the domestic partner of an officer or employee, making it voluntary for a Nevada employer to provide health care benefits to or for the domestic partner of an officer or employee.
The bill passed both houses, but was vetoed by the Governor. However, both the Senate and the Assembly overrode the Governor’s veto, so the bill will become law.

If you have any questions on these or other bills relating to business, please contact the Chamber's Government Affairs Department at 702.586.3805 or contact vmeter@lvchamber.com

2007 State Accomplishments

The Chamber's government affairs department works tirelessly to allow your business to continue taking advantage of Nevada's pro-business environment. In 2007 the Chamber's advocacy efforts defeated countless anti-business legislation and passed numerous pro-business bills into law.

Helped secure $1 billion in transportation dollars. Good roads are vital to the transportation of goods and services, getting employees to and from their jobs, helping customers access businesses and bringing tourists into our state. Transportation infrastructure that is overburdened, congested and in bad condition is not conducive to a growing economy. In short, when transportation doesn't move, business doesn't move. The Chamber applauded the governor and legislators for reaching a compromise that reallocated current tax dollars and revenue sources from various organizations and government entities to the highway construction fund. The Chamber testified in support of Assembly Bill 595 that was passed and signed into law. The road improvements and construction plans are critical to both the commerce and economy of Southern Nevada, and your Chamber is proud to have played a key role in the funding of the state's transportation system. While it does not, by any means, solve the entire issue of transportation, the Chamber believes it is a start to a critical process.
Led a delegation of business leaders to Washington, D.C. and met with prominent leaders of the U.S. Congress. Under the leadership of the Chamber, business owners were able to discuss the concerns and needs facing the Southern Nevada business community with all members of the Nevada congressional delegation in D.C. as well as with various other leaders on Capitol Hill. With more and more federal issues directly affecting Nevada, it is critical that the Chamber continues to build active relationships with Nevada's representatives in Washington, DC.
Advocated for public employee benefit program reforms. Currently, the Public Employees' Benefits Program, the health care subsidy portion of the public employee retirement system, faces an unfunded liability of $6.3 billion. While the Chamber believes public employees are vital to our state, it also believes taxpayers cannot afford to continue funding an overly-generous system. The law creates the State's Retirees' Health and Welfare Benefits Fund. The funds will be invested, offsetting a portion of the current and future costs of health care benefits for public employees.
Protected business owners from the government's eminent domain powers. The Chamber supported two successful measures at the 2007 Legislature which mandated that private property can only be seized for certain public uses and not for the economic development of another private enterprise. Places of business should not be at the mercy of government.
Conducted community presidential caucus training workshops. The Chamber hosted representatives from both the Nevada Democratic Party and Nevada Republican Party to ensure the community was well-informed on Nevada's all-important role in the 2007 early Presidential caucuses. Attendees were able to gain valuable insights to the caucus process and ask questions before the state's first ever early caucuses.