Nevada, Nonprofits, and Conflicts of Interest

This morning I learned a lot more than I knew before about the Nevada legislature. For instance, the legislature only meets every two years, and legislators are only paid for up to 60 days of the 120-day legislative session, which means that, unless they’re independently wealthy, they have to work another job to support themselves.

And what does this have to do with nonprofits? Well, the Nevada Independent is reporting a nonprofit-related political scandal (or maybe “scandal”) stemming, in part, from the part-time nature of the legislature. 

See, Nevada also has what strikes me as a weird budgeting procedure. In essence, the governor proposes a 2-year budget based on previous revenues. If revenue comes in higher, the legislature can pass a “Christmas Tree bill,” negotiated behind closed doors and exempt from state open meetings and public information laws.

In 2023, the state had record surpluses, meaning gigantic Christmas Tree funding.

A bunch of that funding ($110 million) went to nonprofits. Including nonprofits that employ a number of legislators. This apparently doesn’t violated legislative ethics rules, but it sure doesn’t look great.

As a side note, it’s worth noting that a former legislator justified funding nonprofits out of state funds by explaining that

“Nonprofits fill the gaps that don’t really fit for the state, the county and the city,” Carlton said. “There is a role for nonprofits to provide certain services and there’s a role for the state and federal government.”

This mini-scandal is not good for nonprofits. Part of their power lies in public trust, and if the public thinks they’re part of a corrupt system, that will hurt their reputations. Unfortunately, the solution here probably isn’t in the nonprofit space. I suspect the best solution is to pay legislators a living wage so that they don’t have conflicted employment. Or to make the legislature subject to open meeting and public access laws. Or to strengthen ethics rules. Or to cut it out already with Christmas Tree bills.

But whatever the solution, Nevada nonprofits should, for their own sake, push for a funding regime that doesn’t put them in the middle of partisan political battles.

Samuel D. Brunson

Photo by Ken Lund. CC BY-SA 2.0 DEED