Nevada Democrats protest consumer protection cuts

Democratic lawmakers say the governor's proposed elimination of two advocacy programs would set consumer protection in Nevada back decades.

The budget proposed by Gov. Jim Gibbons eliminates not only the Consumer Affairs Division but the Governor's Office of Consumer Health Assistance. Between the two, Budget Director Andrew Clinger said that saves the state $3.9 million.

Gibbons said those programs weren't cost effective. But Democratic leaders in both houses strongly disagreed.

"Cuts to consumer offices in the state would take us back at least two decades," said Assemblywoman Sheila Leslie, D-Reno. "And these aren't bureaucratic, do nothing agencies. There's no question in the Legislature's mind how valuable they are."

The Consumer Affairs Division, part of the Department of Business and Industry, regulates deceptive trade practices in the marketplace. The division registers and bonds buying clubs, credit service organizations, dance studios, health clubs, sports betting information services, telemarketers, travel agents, and tour brokers and operators. It conducts investigations and operates public education programs.

In Fiscal 2008, the division handled 4,565 cases. In this biennium alone, the governor's executive budget projects the division will return some $1.1 million to consumers.

Eliminating it would save an estimated $1.9 million during the biennium.

The Governor's Office of Consumer Health Assistance provides assistance for consumers having trouble with the health care system, from doctors and hospitals to health insurance providers. The office provides information, counseling and advocacy, helping people understand their rights in dealing not only with health care plans but industrial insurance policies. The office handled nearly 4,000 cases last year and, in its nine years of existence, reports it has saved consumers more than $30 million.

Eliminating it would save an estimated $2 million over the biennium.

"But who would do the work?" said Assembly Speaker Barbara Buckley, D-Las Vegas, referring to the consumer affairs division. "When we asked, there were no answers."

Gibbons, asked about the cuts on his way to the Lincoln Day Dinner Friday, said the Attorney General's office can pick up the slack. But Senate Majority Leader Steven Horsford, D-Las Vegas, said when he asked, "the AG said it's not their job to take consumer complaints unless it rises to a criminal level."

As for the Consumer Health Assistance program, Senate Finance Chairman Bernice Mathews, D-Sparks, said: "You absolutely cannot do away with that. It provides a service no one else is doing."

Assemblywoman Kathy McClain, D-Las Vegas, said the programs are worth much more than they cost, especially the Office of Consumer Assistance.

"I know a lot of seniors who have gone through that office, especially for hospital billings," said McClain, a veteran senior advocate.

"The Consumer Health Assistance hearing showed the office's return on investment is phenomenal," said Buckley.

Buckley said the cuts generate relatively little in savings in the overall budget.

Gibbons, however, had a far different opinion: "It isn't a lot of savings but there isn't a lot of service rendered out of these offices. We've studied it and it just doesn't merit the cost of those agencies."

Horsford and others said there seems to be a broader issue in the proposed cuts.

"Apparently the governor doesn't think consumers should be protected," he said. "He's eliminating them at a time when we need it most."

"We have noticed the apparent attack on consumer protection programs in this budget," Leslie said. "There's strong sentiment that these programs are vital to their constituents and need to be saved."

McClain said the proposed cuts "make absolutely no sense."

"When we're in the business of providing services to the public, we're cutting services to the public?"

- Contact reporter Geoff Dornan at gdornan@nevadaappeal.com or 687-8750.