Move to streamline city background checks advances

A proposal to streamline applications for alcohol sales and other privileged licenses in Las Vegas took another step forward Monday, although some say it doesn't go far enough.

The City Council Recommending Committee voted 3-0 for an ordinance to streamline the financial and criminal background checks facing license applicants. It could go to the full council Jan. 23.

The proposal would limit the depths to which the city will plumb for financial information from applicants.

Changes to the process are significant because business owners and others have complained that overly burdensome regulations make it difficult to launch new ventures.

In one example, a licensing application for the Heart Attack Grill, a tourist-oriented beer and burger joint on Fremont Street, was delayed in June because authorities wanted more financial information about the investors, a group that included Zappos CEO Tony Hsieh.

Council members and others said the delay showed the process had more potential to disrupt legitimate business than prevent illegal activity.

Under the existing ordinance, city officials look deep into the personal and professional finances of principal owners and employees of businesses applying for privileged licenses.

The practice dates to the city's mob era, when officials sought to prevent criminals from using bars and restaurants as fronts for illegal activity.

Gambling licenses are regulated by the state and would not be affected by city changes.

The ordinance would limit financial research to identifying the source of funds for a business , as opposed to the personal finances of the applicant.

The idea is to reduce the likelihood the city would investigate the financial background of someone looking to own or operate a chain restaurant when it is obvious the money is coming from a credible corporate parent.

"What we are concerned about is where the money is coming from for a business," Business Licensing Director Karen Duddlesten said. "We are not worried about someone's personal financial status."

In instances when the principal owner is providing personal funding for the business, the city would still want to know about the source of the money.

"We are trying to make sure there are not hidden owners," Duddlesten said.

With paring back financial investigations, the criminal background investigations would be streamlined.

Personal, family, criminal and litigation history checks on applicants would be limited to the most recent 10 years.

Duddlesten also could waive the requirement if the applicant had been through an investigation in the past two years.

She also said city officials are working on a plan to recognize results of background checks by Clark County, both of which are done through the regional Metropolitan Police Department.

Although the changes probably would simplify Las Vegas' notoriously difficult licensing process, City Councilman Bob Beers said they don't go far enough.

Beers, an accountant by trade, said the financial background investigations are pointless because people who are determined to hide the source of their money can evade investigators.

"Cash is fungible," Beers said. "Any competent (accountant) and half the competent attorneys can ... make it anonymous."

With the city possibly facing higher spending requirements for police protection and other critical services, Beers said it makes no sense to dedicate resources to investigations that might be futile.

"How much general fund do I want my city to spend collecting and filing the sources of investment for restaurants around the valley, much less actually analyzing it?" he said.

Contact reporter Benjamin Spillman at bspillman@ reviewjournal.com or 702-383-0285 .