LVCVA spending justifies creation of inspector general, lawmakers say

Excessive spending at the Las Vegas Convention and Visitors Authority highlights the need for a special agency to investigate financial abuse within state and local government, Democratic and Republican lawmakers say.

But a bill creating an inspector general’s office has stalled at the Nevada Legislature.

Three of the half-dozen lawmakers who co-sponsored Assembly Bill 404 have pointed to questions about spending by the publicly funded convention authority — uncovered by a Las Vegas Review-Journal story — while pushing for passage of the bill.

“The lavish spending of the LVCVA is a prime example of why we need the inspector general,” said Assemblyman Ozzie Fumo, D-Las Vegas. “When you’re spending $697,000 on alcohol, $85,000 for showgirls, there needs to be some transparency in government.

“We need someone to have oversight. We have too many agencies like the LVCVA that are going unchecked.”

The figures cited by Fumo appeared in the story as examples of the convention authority’s misuse of public funds in its mission to lure tourists to the Las Vegas area. Revenue projections estimate the agency will receive $300 million in hotel room taxes for its operations in the 2018 fiscal year.

Assemblyman Chris Edwards, R-Las Vegas, shared Fumo’s opinion.

“The inspector general would be the ideal organization to check into the LVCVA’s spending,” he said. “If it were in place now, it could be working the issue already.”

Edwards, who pushed unsuccessfully for a similar bill in 2015, said the inspector general would “safeguard taxpayer dollars” and ensure that government agencies are doing their jobs correctly.

Another co-sponsor, Assemblyman William McCurdy II, D-Las Vegas, added: “Anytime you have an opportunity for oversight over the spending of public money, it is always a good idea.”

Edwards believes Democratic leaders have held up the bill in the Assembly Ways and Means Committee.

“It’s been sitting in Ways and Means for a while,” said Edwards, a member of the panel. “The probability of getting it out is probably less than 5 percent.”

Both Fumo and Assemblywoman Brittney Miller, D-Las Vegas, who introduced the bill, said they do not think Democratic leaders are holding it up. They expressed hope the Ways and Means Committee would have a hearing on the bill before the 2017 session ends on June 5.

In April, Miller distributed copies of the Review-Journal’s story at the Legislature as an example of the potential government waste the inspector general could examine.

In an interview this week, however, she downplayed the convention authority connection to the bill.

“It is not my intention to go after any one issue or agency,” she said, adding that she will reintroduce the measure at the next legislative session if it fails this year.

Assemblywoman Maggie Carlton, D-Las Vegas, who chairs the Ways and Means Committee, and Assembly Speaker Jason Frierson, D-Las Vegas, the panel’s vice chairman, did not return phone calls or emails seeking comment.

Cost of office questioned

Several state agencies, including the governor’s office, have asked how much money is needed to fund the bill. The Ways and Means Committee would have to address the issue before the bill could move forward.

Miller estimated an independent inspector general’s office could cost taxpayers between $700,000 and $2 million a year, depending on the staffing levels.

“It’s a good government issue, and it definitely supports efficiency and transparency,” Miller said.

Curtis Kalin, a spokesman for the Washington, D.C.-based watchdog group Citizens Against Government Waste, said an inspector general would be an asset for Nevada taxpayers.

“I think the clear waste that was exposed by the Las Vegas Review-Journal shows the convention authority should be a prime target of the new inspector general,” he said.

In addition to the large amount of money spent on alcohol and showgirls over a three-year period, the newspaper’s story revealed that the authority shelled out hundreds of thousands of dollars more for concert tickets, skyboxes, banquets, exotic car rides, trips for board members and jewelry for its employees.

In response to the newspaper’s findings, Rossi Ralenkotter, the authority’s president and CEO, defended the spending as part of the agency’s “relationship building” to attract tourists and stay ahead of its competition.

But Bill Noonan, the chairman of the authority’s audit committee, and John Lee, who heads the policy committee, said their panels will review some of the spending and potential policies noted in the newspaper story. Meetings are planned for later this summer.

The Review-Journal is owned by the family of Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson. Las Vegas Sands Corp. operates the Sands Expo and Convention Center, which competes with the LVCVA-operated Las Vegas Convention Center.

The Review-Journal owns the domain lasvegas.com, which is subleased to the Las Vegas Convention and Visitors Authority. The sublease terminates Aug. 2.

Contact Jeff German at jgerman@reviewjournal.com. Contact Arthur Kane at akane@reviewjournal.com. Contact Brian Joseph at bjoseph@reviewjournal.com. Follow @JGermanRJ, @ArthurMKane and @bjoseph1 on Twitter.