Prosecutor says Augustine offered to resign

Friday, Dec. 3, 2004 | 4:34 a.m.

CARSON CITY -- Controller Kathy Augustine, now on trial for misconduct in office, considered resigning earlier this year to avoid possible criminal charges.

Gerald Gardner, chief of the criminal division in the state Attorney General's Office, said Friday he rejected the offer because Augustine would have left office without light coming to the accusations against her.

His testimony came on the third day of the Senate impeachment trial of Augustine, who could be removed from her $80,000-a-year job.

In February or March of this year, Gardner said he received a telephone call from Augustine lawyer John Arrascada, who questioned whether the attorney general's office would agree to a resignation of Augustine for "personal reasons."

At the time, a criminal investigation was proceeding in the case of Augustine, accused of using state workers and equipment in her 2002 re-election campaign.

Gardner said the offer from Arrascada took him by surprise. But after thinking about it, he refused it because the controller would be leaving with no indication that she was misused her office.

During cross-examination, Senate Minority Leader Dina Titus, D-Las Vegas, criticized the decision of Gardner. She said the investigation and subsequent proceedings before the state Ethics Commission and now the Legislature are "costing hundreds of thousands of dollars" of taxpayer money.

She said the public would have been able to select a new controller in the 2004 election if Augustine had resigned early in the year.

Gardner said he refused to accept the resignation because there was "no acknowledgement of wrongdoing. I could not accept it."

"Justice does not come cheap," he said, adding he would not have done things differently.

Later Gardner said, "We could not sweep it under the rug and let it go away."

Augustine's former executive assistant Jennifer Normington, who was the chief witness against Augustine, copied things from a state computer showing that it was used for campaign work. Former assistant controller Jeanine Coward prompted the attorney general's investigation when she turned over the information in early 2003.

Sen. Sandra Tiffany, R-Henderson, suggested the computer information given to the attorney general's office was stolen. She said it was taken without the knowledge of Augustine and some of it was personal.

Gardner said the information about campaign materials should "not have been on the state computer in the first place."

Tiffany also complained that a "couple of people wanted to thwart the controller's political ambitions." Normington and Coward told investigators that Augustine wanted to run for Congress in four years after completing her second term as controller.

In testimony Thursday, Normington quoted Augustine as saying, "I need to set up for Washington."

She said Augustine told her she was "too good for this hick little state."

Tiffany complained that this impeachment process "sure looks like punishment rather than protection of the public."

Impeachment proceedings are aimed at protecting the public from errant public officials.

The case started as a criminal investigation, but the Attorney General's office decided to turn over the matter to the state Ethics Commission thatentered an agreement with Augustine to admit three violations and pay a $15,000 fine, Gardner said.

He said he was aware that if Augustine admitted one willful violation before the ethics commission, the case would be sent to the Legislature for impeachment proceedings.

If criminal charges had been filed, it probably would have been late in 2005 before the case ever went to trial, he said.

Also, attorneys for the Legislature released a legal opinion today that appears to aid Augustine's defense attorneys.

It states that the law does not prohibit a state worker from preparing campaign reporting forms for the public officer who employs him or her and who is running for reelection.

Kevin Powers and Eileen O'Grady, both principal deputy legislative counsels, said the preparation of the forms is "in the state's interest in preventing corruption or the appearance of corruption in the political process and not the personal or financial interest of or private benefit to the public officer or the state employee."

Normington testified she prepared the campaign reporting forms for Augustine during state time. Jim Wells, the former deputy controller, had refused to do the campaign report for Augustine on state time.

Senate Majority Leader Bill Raggio, R-Reno had asked for the legal opinion and he asked Normington today about the time she spent on campaign work, excluding the campaign reports. Normington replied she probably spent 35 to 50 percent of her state time on campaign work if the preparation of campaign reports were not counted.

Normington testified she also had made campaign appearances for the controller during work time.

The opinion also says an unclassified state employee "may engage in political activities during hours of state employment or at any other time, unless those political activities are otherwise prohibited by another statutory provision."

An unclassified employee is one who serves as the will of her boss in state government and has no civil service protection when it comes to firing or other discipline.

Normington, Wells and Coward were all unclassified workers.

The opinion said that under the state ethics law a state employee may not engage in political activities during hours of state employment or at any other time if those political activities involve using governmental time, property, equipment or other facility to benefit his personal or financial.

A possible hitch in the proceedings was resolved today over records from the state Attorney General's Office. The Legislature, acting at the request of defense lawyers Arrascada and Dominic Gentile, wanted the personnel files on Dale Liebherr, who led the investigation into Augustine for the attorney general's office.

The attorney general refused to provide them, saying the federal law prohibits them from releasing the records unless the employee approved. There was a possibility of a suit by the Legislature but then the committee learned that Liebherr today would appear as a prosecution witness with his records.

Normington, Augustine's former executive assistant, testified Thursday she spent nearly 100 percent of her state time working on the campaign in the final three months of the 2002 election.

But under cross-examination, Normington said she was told several times by the controller not to perform campaign work during state hours.

She spent more than four hours testifying Thursday before the Senate partly going through 1,035 pages of campaign materials that she created or helped create on state time using the state computer.

"I was afraid to tell her it was wrong to do it on state time," said Normington, who worked in Augustine's office from October, 2001 to January, 2003 before resigning.

Gentile pointed out inconsistencies in her testimony during cross-examination. Normington told investigators for the attorney general's office in February 2003 that she probably spent three months on campaign chores during her tenure in the office.

She testified at the Assembly three weeks ago that she was forced to work 75 percent of her state hours on the campaign.

The prosecution wrapped up its case Thursday. The defense start this afternoon and the trial was scheduled to continue Saturday.