BEFORE
THE NEVADA COMMISSION ON ETHICS
IN THE MATTER OF THE REQUEST FOR OPINION concerning the conduct of
MARK
ASTON, Clark County Treasurer
This
Opinion is in response to a request filed on August 5, 1997 with the Nevada
Commission on Ethics (Commission) by Rudy Stadelmann concerning the conduct of
Mark Aston, Clark County Treasurer. A
public hearing was held before the Commission on September 26, 1997 at which Mr.
Aston appeared and represented himself. The
Commission heard testimony from several witnesses and accepted into evidence
several documents. At the
conclusion of its hearing, the Commission publicly deliberated the matter and
rendered its decision. The
Commission now issues the following Findings and Fact and Opinion.
FINDINGS
OF FACT
1.
Mr. Aston was at all relevant times the duly elected Clark County
Treasurer. The Clark County
Treasurer has three main areas of responsibility: (1) he is the treasurer of the
county; (2) he manages the county's investments; and (3) he acts as the ex
officio tax receiver for Clark County, Henderson, and Las Vegas.
2.
As the tax receiver, the Treasurer's Office receives tax payments and
deposits them in an account maintained separate and apart from the Treasurer's
other accounts. The tax receiver
account accrues hundreds of thousands of dollars of interest every year.
The principle and interest are to be apportioned on a pro rata basis
to each of the entities that contribute monies to the account.
3.
On April 25, 1990, the Clark County District Attorney, through Deputy
District Attorney Zev Kaplan, informed an internal auditor that the Treasurer
was not allowed to “get to use this money [proceeds generated by the tax
receiver account] at his own discretion. The
Treasurer must follow the budget and purchasing acts applicable to local
governments to receive appropriations for personnel and capital.”
Mr. Aston was aware of this ruling by the District Attorney.
4.
Mr. Aston's budget is set by the Clark County Commission.
His budget is administered by and through the County Manager. Mr. Aston's requests for supplements to his budget to hire
additional personnel or purchase additional equipment must be approved by the
County Manager and the Clark County Commission. Mr. Aston must purchase goods and materials through the
county's regular processes.
5.
At hearing, Mr. Aston indicated dissatisfaction and frustration resulting
from his relations with the County Manager because Mr. Aston felt that his
office required additional
personnel and equipment to perform its duties, but Mr. Aston's requests were
denied or were not fully met.
6.
Mr. Aston used the tax receiver account to purchase or pay for video
games, drinking water for the office, CD-ROM games, a $2,000 bookcase for Mr.
Aston's office, two sets of Christmas cards, an employee lunch, a legal
settlement, and consultant services provided by Nevada Institutional Investments
(NII) and Mr. Kaplan. Mr. Aston explained that the video games, drinking water, and
CD-ROM games were not actual expenditures of public money because Mr. Aston
claimed that his office's employees paid him for these items and he deposited
the funds in the account to cover the checks he had written for these items.
The internal audit could not substantiate that funds had been deposited
for some of these items, and other of these items were not repaid by personal
funds until after the auditor demanded repayment.
The internal auditor determined that any payments made from the tax
receiver's account other than for apportionment payments to the various entities
were improper.
7.
Chris Bunker was an employee of the Treasurer's Office, including at
the time that Mr. Aston was Treasurer. Zev
Kaplan was a deputy district attorney assigned to represent the Treasurer's
Office, including at the time that Mr. Aston was Treasurer.
When both Mr. Bunker and Mr. Kaplan left their respective public
employments, Mr. Aston executed consulting contracts with both of them either
before the person left public employment (Mr. Kaplan) or immediately after the
person left public employment (Mr. Bunker/NII).
Mr. Bunker's/NII's contract was entered in March 1993 and was terminated
in February 1996. Mr. Kaplan's
contract for legal services was entered in April 1995 and was terminated in
February 1996. Mr. Aston did not
use the usual county hiring or contracting processes for these contracts, did
not seek any other applicants for these contracts, had never had such private
consulting contracts before, and did not seek or receive prior approval for
these contracts with either the County Manager or the Clark County Commission.
Both Mr. Bunker/NII and Mr. Kaplan performed essentially the same
functions for the Treasurer's Office before and after they left their respective
public employments. The payments to
Mr. Bunker totaled between $140,000 and $150,000 at the rate of approximately
$5,000 per month. The payments to
Mr. Kaplan totaled approximately $27,500 at the rate of approximately $2,500 per
month. Some of the payments were made out of the tax receiver’s account.
8.
Because of his frustration at not receiving some of his budgetary
requests, including requests for computer equipment that Mr. Aston considered
necessary, Mr. Aston solicited Merrill Lynch to donate computers to his office.
Merrill Lynch donated many computers and other equipment to Mr. Aston for
use at the Treasurer's Office. The
donations were not formally accepted by the Clark County Commission until after
the donations became known to the Clark County Commission through the internal
audit. No accounting was ever made
of what was donated and whether all that was donated was, in fact, in the
Treasurer's Office for the use of the Treasurer’s Office.
The Treasurer's Office uses Merrill Lynch as one of its investment
services. Mr. Aston testified that
his office had approximately $150,000 in the control of Merrill Lynch.
9.
When tax payments were delinquent, sometimes Mr. Aston would authorize
the waiver of the penalty due from the taxpayer resultant from the delinquency.
For most of the time that Mr. Aston gave such waivers, he kept no records
of how much the waiver was or to whom the waiver had been granted. One estimate
was that tens of thousands of dollars in penalties had been waived. Some of the
waivers were for acquaintances and prominent politicians.
ANALYSIS
AND OPINION
Four
issues arose as a result of Mr. Stadelmann's request and the testimony and
evidence at hearing. We will take
each of these issues separately.
The
Use of the Tax Receiver's Account
As
was explained to this Commission, the Treasurer acts as the ex officio tax
receiver for Clark County, Henderson, and Las Vegas. The evidence showed that this account accrues hundreds of
thousands of dollars in interest that must be apportioned and returned to the
governments participating in the account. The money in the tax receiver's
account was public money. None of
the money was Clark County's or the Treasurer's until the money was apportioned
and disbursed to Clark County's general account.
At
times, Mr. Aston used the tax receiver's account as his office's slush fund.
He purchased purely personal items, such as video games, CD-ROMS, and
water, with this account. He
purchased the services of Mr. Bunker/Nil and Mr. Kaplan from this account.
He bought himself an expensive curio cabinet/bookcase for his personal office,
a bookcase that, as the internal auditor euphemistically put it, was not
"standard, government-type furniture."
Mr. Aston bought Christmas cards with this account.
It
is clear to this Commission that Mr. Aston used the tax receiver's account to
purchase items that he could not purchase through his regular county budget.
In fact, that is precisely why Mr. Aston used the tax receiver's account
for these purchases, so he could get what he felt he was due but could not get
through the county's regular channels. Most
disturbing was Mr. Aston's attitude and demeanor at hearing and his actions that
gave rise to the hearing. Many of the personal expenditures made from the tax
receiver's account were not repaid until they had been discovered by the
internal audit, and even then, only after demand had been made for the
repayment. The internal auditor
could not confirm, even as late as the time of hearing, whether Mr. Aston had
fully repaid the tax receiver's account for the personal expenditures.
Mr. Aston stated several times at hearing that he felt he could make such
use of the tax receiver's account because no statute or regulation told him he
could not do it, but it appeared that the District Attorney had already told Mr.
Aston that such use of the account was improper and wrong.
Mr.
Aston's use of the tax receiver's account and his rationale for such use were
wrong, plain and simple. The money
in the tax receiver’s account was public money.
Use of public money for personal purposes and purchases is and always
will be a violation of the public trust and the Ethics in Government Law.
There were other ways Mr.
Aston could have legitimately enhanced his office budget.
A responsible public official does not and cannot simply confiscate
public funds within his control to give himself and his office things that he
could not obtain through the usual and ordinary governmental processes.
The public's money must be handled with the utmost care and
accountability; Mr. Aston's constituents deserved no less.
Mr. Aston's misuse of the tax receiver's account for his personal
purposes was wrong, petulant, juvenile, and damaging to the public's trust and
respect. It also violated NRS
281.481(2) and (7).
The
Contracts With Mr. Bunker/Nil and Mr. Kaplan
Put
plainly, the substantial evidence in this Commission's record showed that Mr.
Bunker and Mr. Kaplan were paid tens of thousands of dollars to do in their
private capacities what they had previously done for less in their public
capacities. The contracts were made
immediately after Mr. Bunker and Mr. Kaplan left their public employments.
The contracts were never put out to public advertisement.
The Treasurer's Office had not used such consulting services in the past.
The contracts were never put before the County Manager or the Clark County
Commission. In fact, some of the
payments for the contracts were made out of the tax receiver's account.
All of these facts indicate that Mr. Aston knew that these contracts were
ethically questionable and that he did not want these contracts to be easily
discovered or scrutinized.
It
may be that Mr. Bunker/NII and Mr. Kaplan performed ably under their respective
contracts. It may be that Clark
County benefited from Mr. Bunker's/Nil's and Mr.
Kaplan's consulting services. It
may be that Clark County saved some money through the use of these contracts.
All of that is beside the point. NRS 281.481(2) prohibits a public
officer such as Mr. Aston from using his position to grant "unwarranted
privileges, preferences, exemptions or advantages for ... any other
person." Mr. Aston clearly
gave Mr. Bunker/Nil and Mr. Kaplan substantial privileges, namely considerable
steady income ($60,000/year to Mr. Bunker/NII and $30,000/year to Mr. Kaplan)
upon which they could build their fledgling private practices.
What made those privileges unwarranted were the circumstances under which
the contracts were formed. Had the
contracts been above-board, arms-length transactions formed in the county's
usual and ordinary processes, they may have been "warranted," and thus
not in violation of NRS 281.481(2). As
the contracts were actually made, though, they were "unwarranted"
because none of the usual and ordinary assurances provided by arms-length
negotiation were evident. This Commission and the public served by Mr. Aston will never
know whether these contracts were needed, prudent, or fairly entered into
because of the way in which Mr. Aston constructed and entered into these
contracts.
In
granting Mr. Bunker/NII and Mr. Kaplan unwarranted privileges by entering into
the consulting contracts under the circumstances evidenced in this manner, Mr.
Aston violated NRS 281.481(2).
The
Computers Donated by Merrill Lynch
When
Mr. Aston contacted Merrill Lynch and solicited its donation of computers
putatively for the use of the Treasurer's Office, Mr. Aston violated NRS
281.481(1).
NRS
281.481 (1) prohibits a public officer such as Mr. Aston from seeking or
accepting “any gift, service, favor, employment, engagement, emolument or
economic opportunity which would tend improperly to influence a reasonable
person in his position to depart from the faithful and impartial discharge of
his public duties." By Mr.
Aston's own testimony, he perceived himself and his office to be victims of
bureaucratic neglect and in desperate straits.
A gift of tens of thousands of dollars of computer equipment under such
perceived need would surely "tend improperly to influence a reasonable
person in [Mr. Aston's] position to depart from the faithful and impartial
discharge of his public duties."
The
rationale underlying NRS 281.481(1) is two-fold. First, NRS 281.481(1) is
intended to protect the public from the evil of a public servant who could be
tempted to stray from the impartial service to the public through gifts and
other similar temptations. Second,
and more important to the instant matter, NRS 281.481(1) is intended to protect
people who transact business with the government from coercion.
In Nevada, a public official or employee cannot extract a donation as an
untold price for doing business with the government.
Mr. Aston crossed the invisible line provided in NRS 281.481(1) when he
solicited thousands of dollars of computer equipment from a company that does
considerable business with his office. Every
investment decision regarding Merrill Lynch made by Mr. Aston after the gift
could be perceived to be tainted, fairly or unfairly.
Mr. Aston should never have put Merrill Lynch in the untenable position
that he put it in.
Since
a reasonable person in Mr. Aston's circumstances would tend to be improperly
influenced to depart from the impartial discharge of his public duties, Mr.
Aston's seeking and acceptance of the donated computers from Merrill Lynch
violated NRS 281.481(1).
The
Waiver of Tax Penalties
The
evidence presented at the hearing showed that Mr. Aston granted an unknown
number of waivers of tax penalties to an unknown number of people in an unknown
amount during a period of years in which Mr. Aston and other county treasurers
were not authorized, as a matter of law, to make such waivers.
The reason so much detail is unknown is the result of Mr. Aston's
conscious design, since he simply chose not to keep such records.
Mr. Aston did admit that some of the waivers were given to acquaintances
and prominent local politicians and that some of the waivers were for
considerable amounts of money. More than that we will never know.
During
the period in which he was not legally empowered to make penalty waivers, each
and every waiver constituted the granting by Mr. Aston of an "unwarranted
exemption" prohibited by NRS 281.481(2), since the term
"unwarranted" will always mean, among other things, "not allowed
by law." Thus, Mr. Aston
violated NRS 281.481(2).
The
Willfulness of Mr. Aston's Violations
All
of Mr. Aston's violations found above were willfully committed under NRS
281.551(1). In fact, Mr. Aston's
willfulness is the essence of each of the violations. As evidenced
by his demeanor and testimony before this Commission and by his actions that
gave rise to this matter, Mr. Aston was a reckless and obstreperous public
servant. Rules that thwarted Mr.
Aston's aims were disregarded or subverted.
Mr. Aston actively, intentionally, and willfully chose courses of action
intended to conceal his actions and to thwart accountability once the improper
actions were detected. Through his
actions, public money with which he was entrusted was endangered, misused, and
unaccounted for. We conclude that
Mr. Aston's violations of the Ethics in Government Law were willful under NRS
281.551(1), but we assess no civil penalty.
CONCLUSION
Based
upon the substantial evidence in the record of this matter, the Commission
concludes that Mr. Aston violated NRS 281.481(1), (2), and (7).
Though we conclude that these violations were willful under NRS
281.551(1), we do not assess Mr. Aston any civil penalty.
COMMENT
It
is specifically noted that the foregoing Opinion applies only to these specific
facts and circumstances. The
provisions of the Nevada Revised Statutes quoted and discussed above must be
applied on a case-by-case basis, with results which may vary depending on the
specific facts and circumstances involved.
DATED:
June 30, 1999.
NEVADA
COMMISSION ON ETHICS
By:
/s/ MARY E. BOETSCH,
Chairwoman