Gaming Control Board faces budget cuts

State gaming regulators could be forced to slow casino audits and curtail law enforcement functions if legislators approve a 15 percent reduction in the agency's operating budget that has been proposed by Gov. Jim Gibbons.

Gaming Control Board Chairman Dennis Neilander said the agency, which oversees the state's multibillion-dollar casino industry, would be forced to eliminate 32 positions under the governor's 2009-11 budget proposal.

Neilander said the budget cuts would not affect the licensing investigation process, such as the examination of MGM Mirage's $9.1 billion CityCenter development, scheduled to open by the end of the year. License applicants pay for the investigations. Also, new games, proposed gambling devices and new casino technology that is tested by the Gaming Control Board's laboratory wouldn't be affected. Applicants also fund that process.

However, the control board's major audits of casinos, which investigate whether the proper amount of gaming taxes have been paid, could be slowed because of a reduction in audit agents. The state mandates the audits take place once every five years, but the control board has been accomplishing the audits every three years.

Also, the investigation of player disputes between casinos and customers could be slowed by the lack of enforcement agents.

"We have to balance all this," Neilander said. "If we deplete resources in one area, it could further damage the state. We have to take everything into account. It's like picking one of your children. It's a tough task."

Neilander said he voiced his concerns to the governor's office last year that budget cuts could decrease the agency's effectiveness in policing the state's largest industry. He plans to express the same concerns to state lawmakers during the legislative session that starts Monday.

The governor's proposed control board budget would be 15 percent below what the Legislature approved two years ago, a reduction of roughly $10 million over the biennium.

The control board operates with 462 full- and part-time positions. A hiring freeze enacted last year has left 27 positions open. Neilander said those jobs would be eliminated if Gibbons' proposed budget is approved. He was confident normal attrition and retirements would keep the agency from having to enact any layoffs.

Neilander said three senior level employees told him this week they planned to retire shortly.

Gibbons' proposed 6 percent salary reduction for all state employees would affect the control board staff, including the salaries of Neilander and fellow board members Randy Sayre and Mark Lipparelli.

"The salary reductions are across the board," Neilander said.

Neilander said a larger concern under the budget proposal is that salary enhancements of up to $5,000 annually for the control board's certified professionals will be eliminated. He said the program was enacted to keep certified public accountants, state licensed attorneys and certified engineers from venturing into the private sector where they could earn higher salaries.

Board members were not eligible to participate in the program.

"The private sector will recover much quicker and we'll have qualified people leave the agency," Neilander said. "The recruitment pool will not be as deep."

He added the elimination of the enhancements for certified professionals means some Gaming Control Board staff members would be taking larger salary reductions than other state employees.

Former Gaming Control Board member Mark Clayton, now an attorney with Lionel Sawyer & Collins, said the agency competes with Nevada city and county governments for certified professional employees. Those jurisdictions, he said, pay higher salaries than those offered by the control board.

"Losing the professional salary enhancements will further hurt the agency's efforts to retain good employees," Clayton said.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.