Nevada charter schools keep falling behind on retirement contributions, says PERS

Charter schools made up five of the nine public employers in Nevada that at some point over the past 2 years fell more than 90 days delinquent on retirement contributions, state lawmakers learned Wednesday.

The Public Employees’ Retirement System of Nevada — better known as PERS — is now backing a bill in the state Legislature to establish a mechanism that allows them to recoup the delinquent contributions.

“The category of employer we’ve had the most trouble with is charter schools,” PERS Executive Officer Tina Leiss told lawmakers on the Assembly Government Affairs Committee Wednesday.

With other types of public employers, such as local government, PERS is able to turn to the Nevada Department of Taxation, which has the authority to withhold payments of public dollars to the county, city or agency behind on the payments.

“Over the years we’ve been able to use that process successfully,” Leiss added. “With charter schools there really is, right now, no one that we can go to that has authority over them.”

Senate Bill 418 would enable the State Superintendent of Public Schools to withhold a charter school’s per-pupil dollars in order to pay PERS. That option would only be available after the charter school is more than 90 days behind. The bill was unanimously approved by the Senate earlier this month and heard by the Assembly Government Affairs Committee on Wednesday. No groups have registered opposition to the bill.

Any public employer falling behind on PERS contributions is a problem because it affects people’s ability to retire. PERS cannot pay out a person’s pension if the employer is behind on their contributions.

Kent Ervin, who follows the Retirement Board as part of his work with the Nevada Faculty Alliance, called it “outrageous and simply unacceptable.”

“These public charter schools have deducted the PERS contributions from employee’s paychecks but did not forward even those amounts to PERS. Some have also not reported the service credits,” he said, referring to the amount of time a person has worked in a PERS-eligible position, which affects pension levels. “It’s a disgrace.”

With charter schools, there is the added concern that they could shut down and never pay what they owe, leaving the state on the hook.

“I’m not picking on charter schools,” Leiss said, “but charter schools are one of the few government entities that cease to exist. Our cities, counties, school districts, fire departments don’t close.”

Two charter schools — TEACH Las Vegas and Eagle Charter Schools, both in Southern Nevada — were delinquent on PERS payments before they shut down last year. PERS was paid the amounts owed as part of the closing of those schools.

According to a memo from Nevada State Public Charter School Authority Executive Director Melissa Mackedon to the Charter School Board, NV Prep and Equipo Academy are on PERS contribution repayment plans approved by the Nevada Retirement Board.

PERS staffer Teresa Chalmers told lawmakers that, as of April 12, the two charter schools had a combined outstanding balance of $266,120.

The SPCSA memo lists a third charter school, Sage Collegiate, as being delinquent as of mid-April. The school was also identified by the SPCSA as being delinquent in late 2023, though it caught up.

At least two other schools were identified by SPCSA as being delinquent but have since caught up.

Leiss said that at one point charter schools had a combined $1 million in contributions delinquent. She also said she had no insight into why charter schools might be more prone to falling behind on PERS contributions than other public employers.