Public Employee retirement reform bill dies in committee

CARSON CITY — A bill to change the makeup of the Public Employee Retirement System board died in an Assembly committee Wednesday after members overwhelming rejected a last-ditch amendment by the sponsor trying to keep it alive.

Assembly Bill 3 as originally proposed by Assemblyman Randy Kirner, R-Reno, would have included three public members with expertise in pension plans and no vested interest in Nevada’s retirement system to the board. Currently, all seven members on the board are plan participants.

Kirner’s initial proposal would have replaced one existing member with someone outside the system and added two others for a total of nine.

On Wednesday he offered an amendment to retain the existing seven and add two outside members. Kirner said his last-minute proposal was an attempt to find “middle ground” and appease critics.

“I strongly believe the public has an interest” in PERS decisions, Kirner said Wednesday. “Some people felt we were trying to fix something that wasn’t broken. That was never my intention.”

But a motion to amend and pass the bill almost died for lack of a second. John Ellison, chairman of the Assembly Government Affairs Committee, then asked for a second to ensure a vote. The measure failed with only Ellison, R-Elko, and Assemblywoman Shelly Shelton, R-Las Vegas, in support.

Kirner earlier testified that having public input would give taxpayers a voice on the board that oversees $35 billion in assets and long-term unfunded liabilities of $12.5 billion.

During testimony last week, PERS executive director Tina Leiss said the current system is a model of best practices.

Critics of the bill also reminded committee members that private sector members were removed from the board in the 1980s because of risky investment ventures and to take politics out of plan management.

Changes approved by the voters in the mid-1990s to protect the system were due in part to concerns that public pension plans could be raided and used for other purposes, Leiss said.

Reforming PERS has long been a priority for Kirner, though past efforts were thwarted by a Democratic majority in both the Senate and Assembly.

This session the political tide has turned with the GOP in control of both chambers, though Wednesday’s defeat could signal achieving major overhauls won’t be easy.

Kirner on Monday introduced a separate bill to phase out the PERS defined benefit plan and put new hires under a hybrid plan that relies mostly on defined contributions.

A hearing on that bill is scheduled Tuesday.

Contact Sandra Chereb at schereb@reviewjournal.com or 775-687-3901. Find her on Twitter: @SandraChereb.