Controversial Nevada GOP leader lands state job

CARSON CITY — The chairman of the Nevada Republican Party, under fire for a loan from a charity he oversaw to a business he was involved with, has been hired by state Treasurer Dan Schwartz as a deputy in the agency's Las Vegas office.

Michael McDonald has been employed since July 20 at an hourly rate of $45.59 per hour, according to state personnel records. His annual compensation with benefits tops $100,000.

Schwartz is out of the office until Sept. 28, but in a statement he said McDonald was hired as a senior deputy treasurer at a salary set by the state. His responsibilities include community outreach.

The statement said the office was aware of recent articles regarding a $2.2 million loan from Miracle Flights for Kids, a Las Vegas nonprofit, to Med Lien Management in 2013. McDonald was on the children's charity board at the time and was a partner in the medical lien company, according to documents filed in a lawsuit and a federal bankruptcy proceeding.

The loan went into default and is now at the center of a civil lawsuit filed on behalf of the charity. McDonald resigned from the charity last year and has denied influencing the loan.

"We have looked into and are not concerned about the various issues referenced," Schwartz said. "The allegations appear false and reflect more the assumptions of their authors rather than any actual basis."

McDonald did not return messages and emails seeking comment. Hewitt said office protocols do not allow staff to respond directly to inquiries from the press.

Schwartz and McDonald, a former Las Vegas city councilman and Las Vegas police officer, are part of the conservative wing of the fractured state GOP at odds with Gov. Brian Sandoval and others in the Republican establishment.

Schwartz, who rode Sandoval's popularity to victory in the 2014 "red wave" election, openly criticized Sandoval's budget proposal earlier this year and was lashed by GOP legislative leadership when he pitched his own budget outline to the Senate Finance Committee.

Schwartz is also in charge of setting up the state's new education savings account program. These accounts allow about $5,000 in state, per-pupil funding to follow a student who leaves a public school and instead funnels the money into a private or parochial campus.

The program was approved by the 2015 Legislature and signed by Sandoval, but two lawsuits have been filed challenging it on constitutional grounds.

McDonald is no stranger to investigations. In the mid-1990s, police scrutinized his relationships with Michael Galardi and Rick Rizzolo, former Las Vegas strip club owners sent to federal prison. McDonald was cleared of any wrongdoing.

Contact Sandra Chereb at schereb@reviewjournal.com or 775-687-3901. Find her on Twitter: @SandraChereb