Augustine’s use of campaign funds for school called legal

Kirsten Searer

Friday, Dec. 3, 2004 | 9:46 a.m.

State Controller Kathy Augustine acted legally when she used campaign funds to help pay for a post-graduate program at Harvard University, the state's legislative counsel said this week.

Campaign reports filed in 2002 show that Augustine solicited at least $4,250 from eight different construction-related funds or companies to pay for the program at Harvard's John F. Kennedy School of Government.

Augustine is on trial before the state Senate this week on charges that she required her employees to work on her campaign during state time. At least one employee testified that she placed calls on Augustine's behalf to collect money for the Harvard classes.

Sen. Dennis Nolan, R-Las Vegas, asked for an opinion to see if Augustine acted legally when she used the campaign contributions for school.

Legislative Counsel Brenda Erdoes responded Wednesday that the funds were used legally, even though state law prohibits officials from using campaign funds for "personal use."

By law, candidates are supposed to return unspent monies to their contributors, keep the money for another election, or give it to another political candidate or group.

But there are exceptions to that rule, including a recent decision that candidates can use campaign money to pay attorney fees.

It's reasonable to assume that Augustine would not have incurred the costs of the class if she were not state controller, Erdoes wrote. Therefore, she can use campaign funds for the class.

John Madole, executive director of the Nevada Chapter of the Associated General Contractors, said he remembers a breakfast with Augustine and about a dozen members of the construction industry in 2001 when Augustine spoke about the classes she was taking.

Many at the breakfast were impressed with Augustine's work to collect millions in unpaid debts to the state, and they wanted to help her progress, Madole said.

"I think some people said, 'We'll try to throw in a few bucks and try to get you there -- the state's going to be the beneficiary,' " Madole said.

Augustine did not make promises to the members of the industry, said Madole, who helped give a donation through his group's fund, the Construction Industry Advancement Fund. Madole said he has known Augustine since her days in the state Legislature in the mid 1990s.

"I don't see anything she would do (as controller) that would really affect us that much on a continual basis," he said.

Other large donors to Augustine's post-graduate program include South Meadows Properties, which gave $1,000 toward Augustine's classes, and Q&D Construction Inc., which also gave $1,000.