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Dollars down the drain

| October 7, 2010

Across Nevada, policymakers are whining that state and local government has been "cut to the bone," and that they cannot be expected to meet present fiscal challenges with current revenues. 

Instead, they claim, suffering Nevadans must pay more.

Regularly evaded is that public-sector workers' wages and benefits far exceed those of private-sector workers, and that gap continues to widen. In fact, a large component of the state's purported deficit results from lawmakers' intent to provide across-the-board pay raises to government workers — raises that would be financed through even harsher tax penalties against suffering private families.

Yet what makes the rhetoric coming from the state's governing elites most egregious is that the "barebones budget" mantra is demonstrably false. Government waste and abuse of tax dollars is rampant in the Silver State — even as legislative leadership beats the drum for another round of record-breaking tax increases that would further worsen the plight of the Nevada family.

The Nevada Policy Research Institute recently compiled just a few examples of government waste within the Silver State into "The Nevada Piglet Book 2010."  The examples of waste documented in the Piglet Book are drawn from hundreds of public-records requests, official financial documents and audit reports.

The Piglet Book shows that five jurisdictions operating public golf courses in Nevada incurred a combined loss in Fiscal Year 2009 of $4.7 million. These jurisdictions could have sold the public courses to private operators in order to generate a $41 million influx of public funds (the combined assessed valuation of the courses) in order to offset the impact of declining tax revenues. However, policymakers have elected to continue competing with the private sector by subsidizing public golf courses in what is a statistically regressive wealth transfer.

Local governments across Nevada spent $3.2 million over a four-month interval in 2009 on paid lobbyists in order to plea with the Nevada legislature for even more tax loot. 

Auditors working in the state treasurer's office have drawn salaries while failing to perform their jobs. A legislative report found that auditors were performing fewer than half of the required audits and that, of the audits performed, some produced no findings.

The Department of Public Safety has failed to develop emergency management plans for state agencies, local jurisdictions and school districts as required by law. In 56 percent of cases, DPS staffers could not locate an emergency management plan when asked by state auditors. In addition, the department has not maintained a database detailing the location of emergency relief equipment as required. The failure of DPS workers to perform their jobs directly places the safety of Nevadans in danger.

Many agencies and school districts in Nevada have used unlawful accounting techniques in order to avoid reversions of funds to state accounts. Others have established unauthorized accounts using unrecorded revenues in order to facilitate misappropriation of public funds.

These are just a few of the abuses detailed in the Piglet Book.

What the Piglet Book makes clear is that behind the echoing calls for gargantuan tax increases is an intent that is disingenuous. Lawmakers driving for tax increases should be compelled to justify the additional burden they want to impose on taxpayers by clearly identifying explicit, well-documented need.

Given the waste detailed in the Piglet Book, this will be a tough sell.

Geoffrey Lawrence is a fiscal policy analyst at the Nevada Policy Research Institute. For more information visit http://npri.org/.

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Geoffrey Lawrence is director of research at Nevada Policy. Lawrence has broad experience as a financial executive in the public and private sectors and as a think tank analyst. Lawrence has been Chief Financial Officer of several growth-stage and publicly traded manufacturing companies and managed all financial reporting, internal control, and external compliance efforts with regulatory agencies including the U.S. Securities and Exchange Commission.  Lawrence has also served as the senior appointee to the Nevada State Controller’s Office, where he oversaw the state’s external financial reporting, covering nearly $10 billion in annual transactions. During each year of Lawrence’s tenure, the state received the Certificate of Achievement for Excellence in Financial Reporting Award from the Government Finance Officers’ Association. From 2008 to 2014, Lawrence was director of research and legislative affairs at Nevada Policy and helped the institute develop its platform of ideas to advance and defend a free society.  Lawrence has also written for the Cato Institute and the Heritage Foundation, with particular expertise in state budgets and labor economics.  He was delighted at the opportunity to return to Nevada Policy in 2022 while concurrently serving as research director at the Reason Foundation. Lawrence holds an M.A. in international economics from American University in Washington, D.C., an M.S. and a B.S. in accounting from Western Governors University, and a B.A. in international relations from the University of North Carolina at Pembroke.  He lives in Las Vegas with his beautiful wife, Jenna, and their two kids, Carson Hayek and Sage Aynne.

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