North Las Vegas supplements municipal accounts with $31 million in unused capital funds

Cash-strapped North Las Vegas unveiled $31 million in unspent infrastructure funds Wednesday, dollars now set to bolster more than three dozen municipal spending accounts.

Some $28 million in unused road, park and building improvement project funds make up the lion’s share of this week’s budget augmentation, with unexpected departmental tax revenues and grants accounting for the rest.

City Finance Director Darren Adair said every capital project dollar the city opts not to spend has to be transferred from one city budget to the next under state law.

He added that it’s not unusual for a city to push unspent capital project funds into next year’s budget.

“These are restricted funds designated for specific projects,” Adair said Friday. “The (accounting) system will not let you make a dispersal outside of the fiscal year plan, so you have to roll those dollars over from year-to-year.”

A dozen departments picked up more than $100,000 as part of the capital funds transfer.

A half dozen other funds — including the city’s ailing water and sewer utility funds — added seven figures to their bottom lines under the move.

Officials report none of those dollars can go toward employee salaries — which make up more than three-quarters of city spending — or North Las Vegas’ nine-figure debt.

Police Supervisors Association President Leonard Cardinale, one of four union heads who helped the city settle a $24 million labor dispute with its collective bargaining groups last month, isn’t buying it.

“All that presentation did was confirm that they added $20 million to the budget that they did not tell us about,” Cardinale said of Adair’s Wednesday presentation on the move. “I understand the proprietary funds were carved out but they have a surplus in funds that we were told was not available.”

It’s not a surplus, according to Mayor’s office Chief of Staff Ryann Juden, just a lot of money being shoveled in different directions.

“The budget process is very open and public, which is why at the beginning of the fiscal year council publicly passes a budget and at the end of the fiscal year staff publicly reports back to council a summary of all fund deviations or modifications that occurred during the year,” Juden said.

“Surely, Mr. Cardinale knows this is a common principle of government accounting done by every municipality across the country. …Fortunately, all our other union leaders understand this basic concept.”

Nevada Committee on Local Government Finance Chairman Marvin Leavitt wasn’t familiar with the specifics of the North Las Vegas rollover of funds, but advised officials to proceed with caution.

“Generally, (capital improvement project) funds can’t be reallocated as operating money,” Leavitt said. “If it’s money from a bond issue, for example, that money is restricted.

“Let’s suppose it’s legal to do it: If you use capital money to fund ongoing operating expenses, what’s your encore for next year?”

Leavitt, who leads the state panel charged with overseeing local government budgets, plans to sit down with North Las Vegas officials for an earlier scheduled check up on the city’s finances in mid-August.

Contact James DeHaven at jdehaven@reviewjournal.com or 702-477-3839. Find him on Twitter:@JamesDeHaven.