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April 21, 2014

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Spending campaign funds on health insurance raises questions

Kathy McClain

Kathy McClain

Mo Denis

Mo Denis

Kelvin Atkinson

Kelvin Atkinson

At least three state legislators have used campaign donations to pay health insurance premiums, raising questions about what politicians can legally do with their war chests.

The secretary of state is investigating expenditures Assemblywoman Kathy McClain, D-Las Vegas, made using her campaign fund. From 2005 to 2009, McClain, who is running for state Senate, used thousands of dollars in campaign money to pay for health insurance and contribute to her public employee pension.

The payments, made while she was on an unpaid leave from her Clark County job and serving in the Legislature, were reported on her campaign finance reports.

A Las Vegas Sun review of other lawmakers’ candidate expense reports found that while McClain most broadly interpreted what she was allowed to spend money on, she wasn’t alone.

In 2005 Assemblymen Mo Denis, D-Las Vegas, and Kelvin Atkinson, D-North Las Vegas, used campaign funds to pay health insurance premiums. Both work for government agencies and have to pay out of pocket for the insurance when they take leave to serve in the Legislature, which is in regular session 120 days every two years.

McClain, now retired from her county job, said she thought her expenses were allowable because if she had not been serving in the Legislature she would not have had to take time off. She said she is cooperating with the secretary of state’s office and will abide by any decision that is made.

“I thought it was totally allowable,” McClain said. “I was totally transparent.”

A Las Vegas resident filed a complaint against McClain, which prompted the investigation. Besides questioning the pension and health benefit payments, that complaint raises questions about $4,500 in campaign money McClain used for rent in Carson City during the 2009 session.

State law says that “it is unlawful for a candidate to spend money received as a campaign contribution for the candidate’s personal use.” But the law does not define personal use.

Some lawmakers have used campaign money to pay for housing while in Carson City, and others have justified buying suits and fast food with the funds.

In 2002, an attorney general’s opinion attempted to answer the question, but concluded that each case would have to be examined separately. The opinion offered general guidelines.

According to the record, the opinion said, the Legislature “generally intended to disallow expenditures of campaign moneys for typical personal and household expenses, such as food, clothing, rent, utilities and the like.” Additionally it concluded that state law would prohibit use of campaign funds “if the particular use would fulfill a commitment, obligation or expense that would exist irrespective of the candidate’s campaign or duties as an officeholder.”

Nevada has a part-time citizen Legislature, designed so lawmakers would be closer to the experiences of the average citizen. The 63 senators and assemblymen earn salaries of $8,777, plus $167 per day to cover meals and housing.

Over a 120-day session, the per diem is about $20,040. On top of that, legislators who live more than 50 miles from Carson City get a housing allowance of $721 a month.

Although legislators can buy into the state’s health insurance plan during a session, there is no subsidy or state match for health care.

“For myself and my family, the health insurance costs $860 a month during the session,” Denis said. “This is definitely not a moneymaking venture during the session.”

Atkinson and Denis said that since 2005, they have paid for health care during the legislative session out of their pockets.

In McClain’s case, the secretary of state has asked her to account for a $7,276 payment to the state retirement fund in 2009, a $4,436 payment in 2007 and $5,002 in 2005. Additionally, she paid $1,945 in 2000 and $1,914 in 2007 to the Clark County health insurance plan.

Atkinson’s campaign committee paid $1,140 to Clark County Health in March 2005. Atkinson, who works for the county and faces a Republican challenger in his bid for re-election, confirmed it was to keep his health insurance while he took an unpaid leave of absence.

Denis, who’s running unopposed for the state Senate, made three payments totaling $2,232 to the Nevada Public Employee Benefit Program in 2005. Denis, who works for the state Public Utilities Commission as a computer technician, takes an unpaid leave of absence to serve in the Legislature.

Secretary of State Ross Miller said he could not discuss McClain’s case because it is pending, but he said it appeared that the statute of limitation had passed on Atkinson’s and Denis’ expenditures.

“We could further clarify the statute,” Miller said, noting that efforts to change Nevada election law consistently fail to pass. But, he said, these issues “need more exposure and transparency.”

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