Friday, Sept. 24, 2004 | 11:21 a.m.
In his financial disclosure, one Nevada legislator lists income from eight different sources. Among them are his salary as an attorney, interest and dividends, social security payments, and compensation for sitting on the boards of two corporations and a charitable foundation.
What do those corporations do? What stocks pay those dividends? Is he a partner in the law firm, or just a junior associate?
The answers to those questions could provide crucial information about the legislator's private interests, but the disclosure form the lawmaker is required to file doesn't say.
The financial information Nevada legislators disclose is woefully insufficient, according to a new national study that examines the personal entanglements of state lawmakers across the country. The study, released today by the Washington-based Center for Public Integrity, gave Nevada an F for disclosure requirements.
"Voters need to know that they can use the information in these disclosures to find out if they're being effectively represented," said Leah Rush, director of state projects for the center.
"But in Nevada, the disclosure did not require a lot of information in a way that is clear for the public to understand," she said.
Among the problems with Nevada's disclosure laws:
While lawmakers are required to file the forms with the secretary of state, the forms are not audited in any way -- not even to check whether they are filled out -- unless a complaint is filed.
Legislators must list their business interests, but the extent of the interest doesn't have to be precise. The form doesn't distinguish between a 5-percent shareholder and a company owner, for example.
Lawmakers have to say who they work for, but not what their job title is, how much they make or what the company does. "If you work for ABC Inc., that doesn't do me any good (to know) unless I know what kind of company it is," Rush said.
Household members' sources of income must be listed, but lawmakers don't have to name their spouses or dependents.
"We're not saying any of these things are actual conflicts of interest," Rush said. "But the more disclosure there is, the more likely voters are to have enough information to see" whether legislators' duties overlap with their personal interests.
There is not enough information in the disclosures for voters to understand where their representatives' bread is buttered, said Paul Brown, executive director of the Progressive Leadership Alliance of Nevada.
Every legislative session, PLAN puts together a report, called "Jackpot," analyzing elected officials' ties to industry based on their filings. But it is often impossible to figure out what's behind the mysteriously named corporations listed on disclosure forms, some of which list an address in an anonymous strip-mall storefront and a phone that rings and rings.
"It takes us six months," Brown said. "By the time we figure out who gave what to whom, the session's over."
More transparency is needed, said state Sen. Dina Titus, D-Las Vegas, who has requested a bill draft tightening the disclosure requirements for the next legislative session. "The more that you put out there in the sunshine, the better off you will be," she said.
The bill will require describing employers, not just listing them, and disclosing directorships and property ownership in more detail, Titus said.
But the Legislature has a history of reluctance to regulate itself, said Steve George, spokesman for Secretary of State Dean Heller.
Heller, he said, "has pushed for more disclosure and been thrown back several times," George said. "Most of the reporting requirements are vague in the way they're written."
During last year's legislative session Heller proposed electronic filing of financial reports, the authority to fact-check disclosure reports and a clarified, ledger-style reporting form for campaign expenses, "but it never passes," George said.
The Center for Public Integrity gave Nevada 49.5 points out of 100 for a failing grade and a rank of 38th among states. But Nevada was hardly alone in flunking: the Center gave Fs to the 24 states that scored less than 60 points. Three states that don't require any disclosure -- Idaho, Michigan and Vermont -- were considered even lower and not ranked.
The study also examined where the potential for conflict might lie in state legislatures. Based on reports filed in 2002, 22 percent of Nevada legislators who reported their finances served on committees that oversaw their private interests, the study found.
About 24 percent of Nevada lawmakers had apparent financial ties to registered lobbying groups, according to the report. And 19 percent were government employees, the eighth-highest percentage in the country.
The study points out that those numbers might reflect not the incidence of potential conflicts but the stringency of disclosure laws. That is, states that required more transparency would have more evidence of potential conflict.
Hal Rothman, a University of Nevada, Las Vegas historian, said it's no surprise that Nevada politics are all tied up with lobbyists and industry. The state has always had a single dominant industry -- mining, railroads, gaming and tourism -- that held political sway.
"There are days on which our politicians would embarrass any self-respecting banana republic," Rothman said.
But Nevada voters are maturing and are no longer willing to overlook beholden politicians, as evidenced by the primary election earlier this month, when two scandal-prone incumbents were ousted, Rothman said.
The debate over whether public employees should be allowed to serve in the Legislature is an especially lively one in Nevada. Heller and Attorney General Brian Sandoval brought a lawsuit arguing that such service violates the state's Constitution, but the suit was rejected earlier this year.
To the Center for Public Integrity, such employment "doesn't pass the smell test," Rush said. "It's a matter of power being concentrated; you don't know whose interests they're representing."
George Harris, director of Nevadans for Sound Government, a group that led a failed petition drive for a ballot measure to ban public employees from the Legislature, said the conflicts are inherent.
"When people are voting for their own pay raises, when people have control over their own bosses -- it's a huge problem," he said.
"But no matter what the statistical analysis says, no matter whether it's morally wrong, the fact is that the Nevada Constitution prohibits it, and we have an activist court that refuses to enforce the Constitution," he added.
Others argue that public employees are like any other members of a citizen legislature: they have an outside interest, but that doesn't make them automatically beholden.
Harris accuses Titus, a professor of political science at UNLV, of "shepherding" huge increases in funding for higher education through the Legislature in order to benefit herself and those around her.
But Titus, whose bill tightening disclosure rules would also require public employee-legislators to take an unpaid leave of absence during the legislative session, says Harris is missing the point.
"What bothers people is not the conflict of interest, it's the double dipping," she said, referring to recent scandals over legislators who received local government as well as legislative salaries during their time in Carson City.
Craig Walton, an emeritus professor of ethics at UNLV, agreed.
"So you're going to throw out all the public employees. Who else?" he said. "All the bankers? All the real estate guys? All the lawyers? Who's going to be left?"
In fact, Nevada's Legislature includes plenty of the professions Walton listed. According to the study, 14 percent of lawmakers were lawyers or had ties, such as shareholding or directorship, to law firms, while 14 percent had ties to real estate.
But the largest percentage, 32 percent, had ties to the rental property industry, and 21 percent were retired. Another 14 percent fell into a category titled "unidentified business" -- another sign of Nevada's lax disclosure rules.
"Most of the public simply wants to know, where do you work? Where does your family work? Where do you derive your sources of revenue?" said Assemblywoman Chris Giunchigliani, who is also preparing a bill to strengthen disclosures.
"On the tax issue last session, we didn't know who was on bank boards until they started recusing themselves, one after another," she said.
Assemblyman Bob Beers, R-Las Vegas, agrees that public employees should be barred, but he said others should also be held to a higher standard. Under current law, legislators do not have to disclose a conflict or abstain from voting on a bill that affects them as long as others like them are similarly affected.
"For example, CPAs are a license of the state," Beers, an accountant, said. "If legislation comes up that affects me no more than any other CPA, I would be able to vote on it. In fact, there is subtle pressure (from caucus leadership) to vote and not abstain when the law does not require you to do so."
As for the legislator with eight listed sources of income, that is Senate Majority Leader Bill Raggio, R-Reno, possibly the state's most powerful lawmaker. Of the boards he discloses sitting on -- Sierra Health Services, Archon Corp., the E.L Wiegand Foundation -- some are obvious, others less so.
Asked whether his form should explicitly state that he is tied to a health insurance company, a gaming company and a Northern Nevada Catholic charity, Raggio said, "I am willing to disclose whatever the law requires. I don't think any more is necessary."
Raggio would not detail his stock ownership, and he said such a requirement would burden and discourage potential legislators.
"You can only make the process so onerous until it's hard to find people who are willing to put themselves on the ballot," he said.
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