It seems that Washington can’t win for losing. When President Obama uses Las Vegas as a metaphor for misspent TARP money, Steve Wynn loses his marbles. When the General Services Administration holds a convention here, people declare themselves shocked – shocked! -- that taxpayer money is being spent in Sin City. As the Las Vegas Sun’s J. Patrick Coolican handily put it: Here is where Las Vegas and the rest of the country part ways: We’ve built an entire industry, indeed, an entire city, around out-of-towners blowing their discretionary income …"
That’s why Las Vegas Convention & Visitors Authority spokesman Jeremy Handel had to walk this rhetorical tightrope: "We are always happy when people choose to visit Las Vegas. However, we’re even happier when people choose to visit responsibly. Taxpayers need to know that their money is being spent wisely, no matter where that is." Apparently $820,000 for a 300-attendee (or $2,733 and change per employee) is an unwise expenditure, even in a town where a night in an Encore hotel suite can cost $10,000.
Aside from the seven-dollar sushi rolls and $49 breakfasts, plus the mentalist who was booked to entertain the conventioneers, what really put the GSA’s fat in the fire was the manner in which the 2010 convention booking was (mis)handled. As the agency’s inspector general wrote, "minimizing expenses was not a goal." Since the then-management of M Resort was cutting the GSA a 2% discount on hotel rooms, the agency unilaterally offered to pay much higher food tabs – as much as $37 above the federal per diem – and book a future event at M, as well as nudge other governmental get-togethers in M’s direction. (It should be noted that M was sucking wind at the time and needed all the business it could get, leaving it with little bargaining leverage.) It was a Vegas "juice job" at its finest [sic]. Or, as Sen. Harry Reid put it, the GSA’s deal-making "demonstrates a complete lack of common sense."
The fallout from l’affaire M fell hardest upon the GSA, whose top administrator and several of her underlings found themselves out of a job. The event was organized by Jeff Neely, a 34-year GSA bureaucrat, one who announced he would ‘take the Fifth’ if subpoenaed by the House Oversight & Government Reform Committee last April. Small wonder: The Carter administration holdover needed no fewer than eight vacations, er, ‘fact-finding’ missions to Las Vegas, at a taxpayer-funded cost of $16,250 per junket, to settle upon M Resort. Whatever Mr. Neely had in largesse, he lacked in smarts. As though to rub people’s noses in his extravagance, he posted 31 photos on Mrs. Neely’s Google+ page (M Hotel@Vegas Nov2009) showing him living the good life, including a shot of the (presumably) naked administrator in the bathtub.
So chastised was the GSA that it overreacted and canceled a 2012 sustainability event planned for Las Vegas … albeit at the comparatively monastic Hampton Inn, on Tropicana Avenue. Penn National Gaming, new owner of M, also felt compelled to engage in some pro forma harrumphing during its spring earnings call.
However, Penn’s profitability was on the rise at the time, so any collateral damage from the GSA scandal seems to be minimal indeed. Although CEO Peter Carlino called the GSA’s expenditure "outrageous," he didn’t offer to refund the money either.
Acting GSA administrator-in-chief Dan Tangherlini, meanwhile, launched a cost-cutting program that has, he asserts, shaved $11 million off the agency’s travel-and-meeting budget. His austerity measures, including revoking a half-million clams in executive bonuses (the private sector could take a cue from him) and nixing 47 conferences. As for Mr. Neely, he was forced into retirement – albeit with a month’s paid leave and a $100,000/year pension.
"We do not specifically track government meetings," says LVCVA spokeswoman Hetty Chang, although she says the agency’s tracking data shows "steady" traffic. Indeed, in the months since the GSA scandal broke, convention business – booked long in advance, to be sure – has been on the upswing. Through June of this year, attendance is flat with 2011 but the number of get-togethers held in Sin City has risen 20%. So if anybody’s feeling the pain of the GSA’s blunder, it’s not Las Vegas, we’re happy to report.
