Heller ran revenue-rich Smith Valley farm without a business license, until asked about it

U.S. Sen. Dean Heller, R-Nev., has made and sold plenty of hay out of his 180-acre farm in Smith Valley over the past several years.

He didn’t have a business license to do so until last week. Nor was he granted an exemption to operate the multimillion-dollar alfalfa spread without that paperwork, a Reno Gazette Journal review of public records reveals.

Under state law, failure to obtain and renew a Nevada business license is punishable by up to $10,000 in fines, collectable by a district attorney or the state attorney general.

But Heller — who spent more than a decade overseeing business filings as Nevada’s secretary of state between 1995 and 2007 — said he doesn't need a license because his farm is a household business that has never turned a profit.

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Secretary of State Barbara Cegavske’s office did not confirm or deny that explanation, offering only that the office “does not make a determination of when an entity is conducting business in Nevada.” That determination is made by the person conducting the business, said spokeswoman Jennifer Russell.

Heller, in any case, filed for a sole proprietor business license on Feb. 5, the same day the RGJ first contacted the secretary of state with questions about his farm’s business license.

Heller spokeswoman Megan Taylor said that in obtaining the license, Heller and his wife Lynne “went the extra mile — even though they were not legally required to do so.”

Taylor said the decision to seek the license was made “when it became clear that national Democrats were pitching stories attacking their family farm.”

The farm, purchased from a Heller campaign donor in 2010, generated at least $169,000 in total income between 2011 and 2016, according to U.S. Senate financial disclosures.

Yet the senior senator — who reported assets worth up to $9.8 million in 2016 — never turned a profit while farming the 120 acres he has in production, said Heller accountant Brian Colodny.

Colodny, writing in a statement relayed by Heller’s office, said the lack of profits meant the farm did not meet the state’s definition of a business required to carry a license.

In a phone interview, he said he wasn’t at liberty to elaborate further on the farm’s profitability or expenses.

State Sen. James Settelmeyer, another GOP politician and hay farmer, said he, like Heller, runs his farm from his home, albeit with a business license.

Fellow Republican state Sen. Pete Goicoechea also holds a license for his much larger farming and ranching operation, if only out of an abundance of caution.

Goicoechea, R-Eureka, said he talked the matter over with the secretary of state before deciding the license was worth a roughly $200 annual renewal fee.

"I don't really think I needed one, I just didn't want the scrutiny," Goicoechea explained. "These things are a public record."

Exemption questions

Heller’s office did not answer questions about why he didn’t seek out an annual, state-mandated exemption from state business license requirements.

Nevada law requires applications from business owners who, like Heller, claim to be exempt from state registration requirements.

But Heller likely didn’t need to file that paperwork, said Bill Bilyeu, the former state lawmaker and attorney who first advised Heller against getting a license.

In fact, Bilyeu isn’t sure such documents exist, despite a variety of exemption forms produced by the Secretary of State.

“I’d like to see the form before I gave any opinion,” Bilyeu added.

The Secretary of State’s office makes three types of business license exemption forms available on its website, including applications for sole proprietorships, general partnerships and other entities that don’t fall into either of the first two categories.

The office did not directly answer questions about whether Heller should have filled out one of those forms.

The Nevada Department of Agriculture confirmed Heller, as a hay farmer, is not required to get a state agriculture producer’s certificate. Smith Valley hay farmers don’t need county business credentials either, according to the Lyon County clerk and treasurer’s office. Officials in that office report Heller is current on his property tax payments.

Heller — a former stockbroker now running for his second term as U.S. senator — has used the farm, and Lyon County in general, as a frequent backdrop for campaign ads. One such spot, released in August, sees a Gulf War veteran tell the camera that Heller “fits in Smith Valley like these trees do, far as I’m concerned.”

“It’s a great place, because the days are a little longer,” Heller says in another ad released this month. “The air is fresher. At night, the stars are a little brighter.

“I live out here in Lyon County because I said to myself 30 years ago that this is where I’m going to live, and here I am.”

Still other ads have been sharply critical of Republican primary election opponent Danny Tarkanian’s “shady business deals.” This month, Heller’s campaign released a spot highlighting some $700,000 Tarkanian paid himself out of a children’s basketball charity he manages.

Some of that money was borrowed to bolster a campaign account when he was running for Congress in 2012, according to a January report from 8 News Now, Las Vegas’ CBS television affiliate. The move prompted accusations from Heller’s camp that Tarkanian was using the nonprofit as a “personal slush fund” and a “piggy bank.”

Tarkanian has denied there was anything improper with the transactions, telling the RGJ that the payments helped to make up for several years when he did not take a salary from the nonprofit.

If he emerges from June’s Republican primary, Heller is expected to face U.S. Rep. Jacky Rosen, D-Nev., in a general election scheduled for Nov. 8.