It seemed like a simple rule: don’t get involved in a political campaign while serving on Nevada’s Ethics Commission. After all, legislators created the commission as the main safeguard against misconduct by candidates and elected officials. To run for office while policing others would seem to be a clear conflict of interest.
But in 2014, no fewer than three of the commission’s decision-makers decided to do just that, seemingly flouting the law and raising the question: who watches the watchdogs?
The controversy left many political observers in the state dismayed, but not necessarily surprised. Nevada’s “anything goes” mentality extends beyond the glittering lights and dinging slot machines of Sin City. While the population has skyrocketed and become more diverse in recent decades, politics here continue to reflect the state’s Wild West roots, with a strong libertarian streak and a part-time legislature that meets for just a few months every two years.
Key decisions about everything from budgets to pension oversight are made in unannounced, late-night meetings of legislators or by citizen board members and commissioners who earn only token pay and face little accountability.
The Silver State has made strides in putting government records online, and passed strong laws protecting whistleblowers and cracking down on lobbyists’ wining and dining of lawmakers. But with a lax attitude toward verifying information provided by candidates and elected officials, a crippled ethics enforcement system and a legislature that basically polices itself, Nevada earns a score of 57, or F, in the State Integrity Investigation, placing it 46th among the 50 states. The investigation is a data-driven assessment of state government accountability and transparency by the Center for Public Integrity and Global Integrity.
Big business, small-time Legislature
Nevada’s Legislature governs a state with a $120 billion economy that includes the epicenters of the country’s gaming and gold-mining industries and one of its most-visited tourist destinations. Yet lawmakers are not subject to the same open meetings law that applies to local school boards and city councils.
With all of the state’s business crammed into one biennial spring session, the pace of decision-making can become frenetic as deadlines approach. Lawmakers sometimes hold meetings without providing advance notice or agendas to the public, while exhausted legislative staffers struggle to keep up. Budget decisions between sessions are made with little fanfare by a small group of legislators.
“It’s almost impossible to think about, with a part-time citizen legislature … how you could possibly get a good grade in managing the budget,” said David Byerman, former secretary of the state Senate.
The legislature employs an auditor to dig into the finances of the executive and judicial branches, who has ferreted out safety problems at the state’s juvenile detention centers and investigated long-hauling of tourists by state-regulated taxi drivers. But no one audits the legislature itself.
And while Nevada recently banned all gifts to lawmakers from the state’s powerful lobbyists, those lobbyists still aren’t required to report on their activities between sessions. The disclosures they do file aren’t checked for accuracy, just one detail that helped earn the state a ranking of dead last in the category of lobbying oversight.
Nevadans value the freedom they enjoy under a limited government. There’s no state income tax. You can buy medical marijuana in Las Vegas and canoodle with a prostitute in Pahrump.
But transparency advocates argue it’s possible to retain much of that freedom while modernizing a legislature they describe as a relic of an earlier time.
“It’s all the small Western states that have low population levels that have not been able to move from the 19th century into the 21st century,” said Sondra Cosgrove, president of the League of Women Voters of Las Vegas Valley and a history professor at the College of Southern Nevada. “It benefits the people who actually run this state, the gaming industry and some of the political players, to have a part-time legislature and not have things work, because then they can control everything.”
Under the radar
When Gary Lambert applied for a grant for his nonprofit, Nevada Trail Stewards, from the state’s Commission on Off-Highway Vehicles in 2014, he might have thought it was a lock — Lambert was also the commission’s vice-chair. But when he argued in favor of the application to his fellow commissioners, he did so without fully disclosing his relationship to the nonprofit, a violation of state ethics laws, according to a complaint filed with the Ethics Commission.
Lambert admitted to the violation and agreed to take state-provided ethics training, commission records show. Lambert couldn’t be reached for comment. But current Nevada Trail Stewards chairman Scott Gerz said other commissioners were already aware of Lambert’s interest in the nonprofit, and that he wasn’t the only one to push for a pet project.
The commission has since updated its grant-making rules. But it’s impossible to tell how many similar cases are out there, because Nevada does not require members of most of the state’s dozens of boards and commissions to disclose their financial ties.
The Ethics Commission, which is responsible for monitoring these public servants, struggles with limited resources in addition to its own ethical problems. While former Executive Director Caren Cafferata-Jenkins resigned after her judicial campaign drew scrutiny last year, two commissioners who ran for office in apparent violation of state law continue to hold their seats.
One of them is John Carpenter, a former rancher who ran for the Elko County Commission, who said he didn’t see any conflict of interest — even though state law says ethics commissioners may not “be actively involved in the work of any political party or political campaign.”
“If I had got elected then I would’ve resigned immediately,” Carpenter said. “The ethics commission is sort of a stand-alone commission and I don’t think they are involved in politics like some other parts of government are. And I told people from the ethics commission that I was going to run for county commissioner and nobody said, ‘You should not do this.’ ”
The Ethics Commission has only one investigator, and the commission’s own 2014 annual report said current law makes it “nearly impossible” for it to cite offenders with the kind of willful violations that lead to fines.
“The Commission sees our mission first and foremost as education,” said Executive Director Yvonne Nevarez-Goodson. “It’s not our goal to be prosecutors and go out there and catch wrongdoing.”
Decades may have passed since mobsters like Bugsy Siegel and Meyer Lansky built casinos up and down the Las Vegas Strip, but these days it’s corporations that are making the state of Nevada an offer it can’t refuse.
From administering healthcare programs to updating computer systems, companies won $1.7 billion in no-bid contracts with Nevada from 2011 to 2015, according to a Las Vegas Sun investigation. That’s 27 percent of the total contracts the state awarded — thanks to legal loopholes that allow officials to bypass the state’s normal competitive bidding process.
Even accusations of fraud and poor performance don’t always prevent companies from receiving contracts. In November 2013, Nevada’s Department of Health and Human Services signed a $130 million contract with McKesson Health Solutions to create a care management system for Medicaid recipients. The decision came a week after the company’s parent corporation, McKesson Corp., had agreed to pay the state of Wisconsin $14 million to settle a lawsuit alleging that it had fraudulently inflated prescription drug costs.
Xerox Corp. lost its contract to manage the state’s health care exchange website in May 2014, after the site was found to contain hundreds of glitches. Yet the company continued to receive state contracts, including a $7.8 million deal to audit unclaimed property.
“Especially if [a company] has long-standing ties to the state, one complete screw-up doesn’t negate them getting another [contract],” said Kyle Roerink, the Sun reporter who covered the no-bid deals.
Some steps forward
Nevada has shined a brighter light on some government workings since 2012, when the state earned a 60, or D-, in the first State Integrity Investigation. (The two scores are not directly comparable, due to changes made to improve and update the project and methodology, such as eliminating the category for redistricting.)
Political candidates are now required to file their campaign finance reports online. A new cooling-off period, imposed by the Legislature in 2015, will slow the revolving door of former lawmakers returning as lobbyists.
Nevada ranks in the top half of states for executive accountability and the state budget process. Citizens can access an easy-to-navigate website that provides budget information down to the line-item level.
Technology has driven many of the improvements, with social media giving more Nevada residents an inside look at what goes on in the state’s capital, Carson City, while the secretary of state’s searchable campaign finance record database makes journalists’ work easier.
Further progress, however, may depend on Nevadans’ willingness to mobilize and demand more information about their government.
“This state is a good-old-boy network,” said Michael Green, an associate professor of history at the University of Nevada, Las Vegas, and political columnist for Vegas Seven magazine. “They’re going to be as transparent as they have to be, but not more transparent than they need to.”
By Sean WhaleyReview-Journal Capital Bureau CARSON CITY — Very low marks for the state’s purchasing process, internal auditing and lobbying disclosure dragged Nevada far down in the national rankings for public integrity, coming in at 46th out of 50 in a recent survey for its overall governance and anti-corruption efforts.
But if it’s any consolation, most states scored poorly in the 2015 State Integrity Investigation, a data-driven assessment of state government last performed by the Center for Public Integrity and Global Integrity in 2012.
Alaska had the best overall grade, but only managed a C with a score of 76.2 out of 100. Nevada and 10 other states got an F.
Nevada’s overall score of 57 edged out only South Dakota, Delaware, Wyoming and Michigan. Nevada received a D- in 2012.
The report notes that there has been little progress on transparency issues in Nevada or nationally since the first investigation in 2012.
“Overall what you see in Nevada are just poor scores pretty broadly in most of the categories,” said Nicholas Kusnetz, project manager and reporter on the effort. “In eight of 13 categories the state scored 50 or below. Across the board, for the most part, there is a lack of transparency.”
But some effort is being made to change that.`
‘The battle is never over’
Bob Fulkerson, state director of the Progressive Leadership Alliance of Nevada, said increasing accountability by state officials has been an ongoing mission of his group.
“We’ve testified nearly every session since 1995 on better reporting and transparency because Nevada’s shameful ethics and lobbying rules undermine public confidence in our democracy,” he said. “Lobbyists and the corporations whose profits they seek to maximize at the public trough are the only ones who benefit from the current system. We must expose them, and the legislators who do their bidding, in order for the system to change.”
Victor Joecks, executive vice president of the conservative think tank Nevada Policy Research Institute, praised the report authors for making the effort to improve accountability in state government.
“It’s always good to shine the light on government transparency and look at how responsive the government is at letting citizens, those who the government is supposed to be working for, have access to information,” he said.
While the analysis was mostly negative, Joecks said, Nevada does have strong open meeting and public records laws, with a few notable exceptions. One is that the Nevada Legislature has not subjected itself to the Open Meeting Law, he said.
“These reports remind lawmakers and citizens that you have to keep fighting for transparency,” Joecks said. “The battle is never over.”
Low marks for lobbying
Nevada scored the lowest among all states in the category of lobbying disclosure with a score of 38.8.
Kusnetz said several factors went into the ranking, including the fact that lobbyists in Nevada only have to report spending when the Legislature is in session for 120 days every other year.
Also, he said: “Nevada law does not recognize lobbyists that just lobby the executive branch. The reports that are filed are not audited. Lobbyist employers do not have to say what they pay their lobbyists.”
The 2015 Legislature approved some reforms to the lobbying process. One measure, sponsored by Senate Majority Leader Michael Roberson, R-Henderson, will clarify and prohibit most lobbyist spending starting Jan. 1. The law prohibits lobbyists from giving — and lawmakers from accepting — anything of value, whether or not the Legislature is in session. The prohibition extends to members of a lawmaker’s household or staff.
There are exemptions, though, for items such as travel, lodging and meals provided as part of an educational or informational meeting, event or trip. Also still permissible is the cost of a party, meal, function or social event to which every legislator is invited.
Other trouble spots
Nevada also received low marks for its internal auditing system, which the report criticized for being vulnerable to political interference. Nevada’s Division of Internal Audits is under the governor’s office, and while there is no suggestion such interference is occurring, Kusnetz said, the stage is set for it to happen.
Nevada’s Public Employee Retirement System was similarly flagged for a lack of controls to prevent the board members who oversee the pension fund from making investment decisions that financially benefit them personally, Kusnetz said.
Nevada law only requires public officers who earn more than $6,000 a year from their nonelected posts to file financial disclosure statements with the state secretary of state’s office. PERS board members, like those on most other state boards and commissions, receive just $80 per meeting.
But Tina Leiss, executive officer of PERS, said board members are required to disclose conflicts under the state’s Ethics in Government law and its laws governing open meetings, public records laws and fiduciary duties.
Of course, public records are only as good as the public’s ability to see them, and Kusnetz said Nevada — like all but six other states — received a failing grade for access to government information.
Nevada’s low score was the result of several factors, including the difficulties a member of the public faces if a record request is denied, he said.
“There is not really a good process for appeals that is effective, and there are no consequences if an agency fails to turn over documents,” Kusnetz said.
Contact Sean Whaley at email@example.com or 775-687-3900. Find him on Twitter: @seanw801
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