Gibbons’ first year: A bumpy solo ride

By David McGrath Schwartz

Sunday, Dec. 23, 2007 | 6:53 a.m.

Budget

With state revenue falling $440 million below projections, Gibbons defies criticism some from Republicans and refuses to consider raising taxes. Instead, he considers cuts on his own.

TaxesGibbons hasn't addressed the states tax structure, which largely depends on the ups and downs of tourism. Its not clear whether he sees the need for an overhaul, as many of Nevadans leaders do.

Appointments

The governors baffling and controversial political picks have included appointing a supporter of a nuclear waste dump at Yucca Mountain to the board of the states anti-Yucca commission.

Scandals

One of the issues shadowing Gibbons includes an ongoing FBI investigation into allegations that, while in Congress, he helped a defense contractor land contracts in return for gifts and money.

Gov. Jim Gibbons had received the first tax data and the picture was grim. The report showed far less money than needed heading to the state's bank account.

A few hours later on Oct. 15, Gibbons walked into a Cabinet meeting and told his department heads to prepare for cuts. He didn't sugarcoat the message.

It was Gibbons as the former fighter pilot. He had seen the budget numbers and acted. No consulting, little consideration of the politics.

In the following weeks, the governor's straightforward approach dissolved into messy consequences.

Some departments were exempted from cuts. After protests, other programs were exempted. The amount of money the state needed to cut kept changing. Legislators and other state officials raised countless questions. Four proposals went forward before Gibbons seemed to settle on one.

A skilled chief executive and seasoned staff might have anticipated the trouble spots and talked to appropriate officials to resolve many of the issues in advance. But that is not Gibbons.

As the year winds down, the governor's handling of the state budget shortfall deserves scrutiny as Exhibit One for his performance in 2007.

More than the early rash of verbal gaffes or the generally high marks he earned at the end of the legislative session or a long line of controversial - and occasionally strange - political appointments, his actions related to the budget cuts define Gibbons' freshman year.

They reveal much about his style as a communicator, his political savvy and his philosophy of government, which thus far is anchored by his pledge to not raise taxes.

His first year in office has been like no other in Nevada history, said Eric Herzik, a political science professor at UNR and a Republican.

"No governor has hurtled from one crisis or problem or potential scandal to another the way Gibbons has," Herzik said. "But at the end of the day, he survived it all."

The biggest problem has been the budget. As state revenue fell $440 million below projections, Gibbons clung to his commitment to not raise taxes, even in the face of harsh criticism, some from his own party.

As he wrestled with the problem, he did not round up support from likely allies, including Republican Sen. Bob Beers, who also is imbued with anti-tax fervor and could have been a strong ally in the ensuing public debate.

Gibbons also did not consult in advance with Senate Majority leader Bill Raggio, R-Reno, who by virtue of his position and influence should be courted by any Republican governor. Raggio watched the cuts reported in the news before he got a call from the Gibbons administration.

When reports of the initial proposed cuts filtered out to the news media and questions started going to the governor's office, staff members were not prepared with answers.

Gibbons later said he never expected the media would learn about the cuts in advance. But at the time, he made no statement. Instead, he sent his budget director, Andrew Clinger, to talk to reporters. As Nevadans learned, their governor shies from public forums. He has said he is not comfortable in the "fishbowl" of the Governor's Mansion.

As he reflected on his first year and first legislative session, Gibbons told the Sun he has "learned a great deal since the last time by going through the legislative sessions. I will be better prepared."

Gibbons, 63, is a former five-term congressman who arrived in office with virtually no political capital. He had won with less than 50 percent of the vote, and he was dragging behind him a number of scandals from the previous months.

They included allegations that while in Congress he helped a Northern California defense contractor, Warren Trepp, obtain government contracts in exchange for gifts and money. The matter is under investigation by the FBI.

He also has been accused of helping another contractor, Sierra Nevada Corp., get a federal contract while his wife was paid $35,000 by the company as a consultant. That arrangement is not known to be under investigation.

Finally, in the weeks before the election, he allegedly assaulted a Las Vegas cocktail waitress, Chrissy Mazzeo. After a police investigation that critics complained lacked aggression, Mazzeo's allegations were dismissed.

As the legislative session opened early this year, Gibbons revealed a public style that ranged from low-profile to invisible. Yet as the session reached into spring, he won battles to have empowerment schools funded and compromised with Democrats to pay for expansion of all-day kindergarten. (The latest proposed budget cuts are likely to delay or scale back those programs.)

Gibbons also diverted money as a way to secure $1 billion in extra funding for highways and roads, although transportation advocates say the rapidly growing state needs five times that amount to catch up with demand.

His appointments were fairly routine, except for those that weren't. The ones that stood out ranged from controversial to baffling.

For instance, Gibbons appointed a supporter of a nuclear waste dump at Yucca Mountain to the board of the state's anti-Yucca commission. Then he reversed the selection. He kicked a Clark County airport representative, Rosemary Vassiliadis, off the state'sHomeland Security Commission. He replaced Joe Brown, a Republican National Committee member and Gibbons supporter, on the state's Athletic Commission.

Gibbons' energy director chose Joe Enge, a conservative education analyst, as deputy director of the Office of Energy, even though he acknowledged that he had no energy experience. Enge resigned as news reports circulated about his qualifications and record of drunken driving.

Supporters say these and other gaffes are nothing more than fodder for the state's political class and don't raise eyebrows among voters.

"We're really a small minority of people who pay close attention to these matters," said Robert Uithoven, Gibbons' former chief of staff when he was a congressman and his campaign manager during the gubernatorial election.

Although Gibbons said he does not want to make budget cuts, the deficit may have saved his year on the political side. He has had ample opportunities to repeat his no new tax pledge.

"He ran and was elected on saying no new taxes," said Sig Rogich, a Republican kingmaker who backed Gibbons. "Poll numbers reflect the fact people are coming in line with him." (Rogich said he has done polling for private clients showing Gibbons' approval ratings significantly up, though he would not release the details to the Las Vegas Sun.)

Chuck Muth, a conservative activist and critic of government expansion, praised the governor for sticking to his core position.

"He was running on a platform that he wasn't going to raise taxes," Muth said. "He stuck to that campaign promise."

Herzik said Gibbons' stands against new taxes and for lean government work well in Nevada politics. However, Herzik said Gibbons handled the budget cuts in a messy way.

"His problem wasn't the budget cuts," Herzik said. "The problem is he doesn't communicate well with the legislators. He doesn't communicate well with the public, for that matter."

The administration and the governor's office staff have indeed been criticized for their inability to communicate through the media or to their supporters.

During the legislative session, Muth called the governor's office to weigh in on a public policy issue.

"I got a call back two months after the legislative session ended," he said. "He's just not returning calls, even from his allies. It's starting to wear on people."

Legislators also complain about what they see as a vacuum around Gibbons' decision making.

"This administration is just so unpredictable," one veteran lobbyist said.

Although Gibbons' base might applaud the governor's staunch anti-tax stand, he is facing increased pressure to look more broadly at the state's tax structure.

Terry Lanni, MGM Mirage's chief executive officer and chairman, and a Gibbons supporter, has called for a look at a broad-based tax.

Senate leader Raggio, though applauding Gibbons' call for cuts in spending, has called for a detailed look into the state's tax structure. Raggio also has criticized elected officials for making broad pledges not to raise taxes.

So far, Gibbons has not addressed the longer term issue of the state's tax structure, or even said whether he thinks it presents a problem. That has led to an easy story line for those wondering whether Gibbons will show leadership next year.

"Will Gov. Gibbons see the need to restructure taxes, even without raising them, so we're not vulnerable to the cycles of one industry?" asked James Wadhams, a lobbyist who has worked for Democratic and Republican governors.

Uithoven acknowledged that the administration has, so far, been reactive, putting out fires of the day.

"Is there a road map for five or 10 or 20 years down the road? I haven't heard that," Uithoven said. "I have heard him address the immediate budget cuts with more clarity than anyone else."

Next year, Gibbons will prepare a budget for the first time, rather than simply modify one left behind by the previous governor. He said it will be conservative.

"We have to get the Legislature to believe that spending ought to be reflective of the growth in the state," he said. "When I look back at the growth in spending over the past several years, it is a remarkable reflection of the appetite of the Legislature to feel they need to spend money on everything and more money on everything."

In 2008, Gibbons' agenda includes appointing two new district judges in Las Vegas and defending his 4.5 percent cuts in the budgets of the state, the university system and public schools.

He is not so naive as to believe that the attacks by Democrats will cease with the new year. "They've been on my tail all year long," he said, suggesting lawmakers should set aside partisanship on certain issues.

"I don't think we should be putting roadblocks in the way just for the sake of sticking a thumb in my eye," he said.

Staff writer Cy Ryan contributed to this story.