Regents will have to wait on report of ‘hosting’ audit

Jeffrey Libby

Monday, Nov. 27, 2000 | 11:15 a.m.

State institutions of higher learning spent nearly $2.4 million on business lunches, flowers and other fund-raising activities in 1999. In October regents asked for an in-depth audit of those expenditures for the first time.

But when regents meet later this week in Las Vegas for what is being called a light schedule, the requested audit of those host expenditures will not be available for review.

The report, initially expected to number as many as 1,000 pages, has been put off until January. And due to a temporary compromise worked out with system auditors, it is more likely to run less than 10 pages.

"While the vast majority of the expenses are probably appropriate, we have to look to see if there is any truth to the golfing outings and gourmet dinners people talk about," Sisolak said.

"We're auditing the music department for $200 and some lost CDs. Or the garden center. We're auditing that department. And here (the hosting accounts), the potential for risk is astronomical. They have never been audited," Sisolak said.

Hosting accounts as submitted now are too vague and lack any uniform categories among institutions, Sisolak said.

For instance, Sisolak said too many questions remain when the School of Medicine at the University of Nevada, Reno, reports only that it spent $158,000 on hosting in 1999, supplying no further detail. Or when the Community College of Southern Nevada reports expenditures of $150,000 for institutional hosting without supporting documentation.

In 1999 alone, UNLV spent more than $1 million on hosting. The University of Nevada, Reno, spent $900,000 and CCSN $190,000.

None of the money spent through these accounts comes from the state, Sisolak acknowledged. But he said it would be difficult to ask the state for more funding at the same time that public institutions were unable to account in detail for $2.4 million of their own money.

Regents have asked Gov. Kenny Guinn to approve a system budget in excess of $1 billion for 2001-2003, up 15 percent from the previous biennium.

Joseph Crowley, president of UNR, defended the practice of hosting as an investment.

"This is a way to bring in money for the university, to make friends for individuals in the hopes that they will realize somewhere down the line some private giving," Crowley said.

Ashok Dhingra, the vice president of administration and finance at UNR, said host accounts have to be authorized by the president or the dean and that if an unfamiliar name surfaced for a lunch date, the situation would be reviewed.

Dhingra did not agree that the extensive detail requested by Sisolak is necessary.

But Regent Howard Rosenberg acknowledged that a more in-depth accounting of the money could help public relations, if nothing more.

"There's a perception that some money is not being spent the way it should be," Rosenberg said. "The only way to clear things is to give Steve what he wants and give the detail. I think you'll find on the whole that the money is being spent properly."

Sisolak said state institutions should be as accountable for hosting expenses, as are state legislators. Legislators must record expenses and gifts down to the $1.25 bagels bought for them by lobbyists, he said.

But with the initial report expected to be shaved closer to 10 pages than 1,000, Sisolak won't likely uncover such clarity of detail come January. He knows it.

"I understand that to ask for a detailed accounting of every time someone went out to Starbucks for coffee (while recruiting) would be volumes and volumes of paper. But I've put the institutions on notice. I want to make sure there is no misuse and abuse of funding," Sisolak said.

The expected audit will break hosting expenditures into eight standardized categories. Each institution will list those expenditures on a one-page summary sheet.

Entertainment expenses, which would come under both "community relations" and "participation in funded events" interest Sisolak most.

When system auditors report in January, Sisolak said he will most likely request a further breakdown in those two categories, as he originally requested.