CARSON CITY — Flags flew at half-staff at the Capitol in honor of the recent passing of former Nevada Gov. and U.S. Sen. Paul Laxalt, the son of a Basque sheepherder who carved the shape of a legend in Nevada politics. He was 96.

A short walk from the heart of state government at a haunted mansion better known as the Ormsby House hotel and casino, locked doors and darkened windows were once again the order of the day. The Ormsby has been troubled for so long it’s hard to keep track of its current management. It seems to stand in shadow even on Carson’s clearest days.

Its original owners were well known. The intriguing story of Laxalt’s five-year shepherding of the Ormsby House is part of his story, but not one detailed in many of the obituaries that painted the remarkable arc of his career in politics as the famous “first friend” of President Ronald Reagan.

Laxalt gathered many good friends in his long life, and he was a good friend to have with access at the highest levels of politics and business. After a single term as governor, an office most Nevada boys would covet, Laxalt used some of those friendships to secure exceedingly handsome terms for the construction of the Ormsby. It opened in 1972 and appeared to have a bright and financially lucrative future. Instead, its history under the Laxalt brand would be marred by controversy.

Like most Nevada politicians, Goldwater Republican Laxalt was buffeted between doing what was best for his promising career and what might actually improve Nevada’s reputation as a haven for hoodlums and a state run by a casino industry manipulated by mobsters. In order to defeat incumbent Democrat Grant Sawyer for governor in 1966, Laxalt had to court the casino industry while promising to defend Nevada from “unsavory characters” — no mean feat considering some of those characters were among his best supporters.

Desert Inn bosses Moe Dalitz and Ruby Kolod, for instance, might have been persona non grata elsewhere, but their money helped Laxalt defeat Sawyer, who had overhauled gaming regulations in the state and created the Black Book of persons banned from entering the state’s casinos.

Laxalt made powerful friends. Although he’s been credited as the “father” of modern gaming for helping to usher in the corporate era of licensure, he also allowed eccentric billionaire Howard Hughes to receive a casino license without submitting to a public hearing or even so much as a finger print. In doing so, he made a friend — Hughes talked of backing his career all the way to the White House and once used him to try to slip President Richard Nixon $100,000 — but he added another compromise.

The character concessions continued during his relationship with Teamsters Central States Pension Fund consultant Allen Dorfman, a close associate of union president James Hoffa, the man most responsible for helping to facilitate a new generation of loans to casino developers. Those loans were essential to the growth of Las Vegas, and they were also riddled with influence by organized crime. Dorfman became wealthy in the process, and he knew how to take care of his friends. (Dorfman also became expendable after a 1982 conviction of conspiring to bribe Nevada Sen. Howard Cannon. Just prior to being sentenced in January 1983 along with corrupt Teamsters president Roy Lee Williams and Joey Lombardo, Dorfman was murdered.)

That Laxalt shared warm feelings about Dorfman isn’t in doubt, or unique in Nevada politics. But few politicians would reduce to paper their affection for a man convicted of a union loan kickback scheme. Shortly after leaving office in 1971, Laxalt penned a letter to Nixon calling for Hoffa’s pardon and release from prison. He noted the importance of Teamsters loans to the gaming industry, vouched for the credibility of Dorfman and other top Teamsters executives, adding, “I cannot believe that the man (Hoffa) who organized this group is the criminal type so often depicted by the national press.”

Nixon must have agreed. Hoffa was released from prison, but when he sought to return to power he sealed his fate. He disappeared in 1975.

The Laxalt who rubbed elbows with Dorfman and polished Hoffa’s halo is the same man who boasted to reporters about cleaning up the “so-called underworld taint” from Nevada’s casino industry by allowing Hughes the run of the House and the whole damn state. Whether it helped that Laxalt’s law firm listed Hughes as a client, one who it was later learned was billed more than $100,000 for services, is just another part of the man’s legend.

He joined the U.S. Senate in 1974, and as pressure mounted on the casino industry he railed against the “interference” of federal law enforcement in the business affairs of Nevada. Like other elected officials in the Silver State, he was more than willing to roll up his sleeves and duke it out for the gaming industry. After all, he was among friends.

He sold the Ormsby House not long after joining the Senate, but he would be haunted by it (and his old friendships) the rest of his political career. After a Sacramento Bee article raised the issue of extremely friendly financing and the specter of casino skimming, Laxalt filed a $250 million defamation suit that ground on for several years before being settled with both parties declaring victory.

Along the way, the public learned that Laxalt and brother Peter Laxalt had managed to obtain $6 million in construction loans for the Ormsby while investing just $1,851 of their own money. When more money was needed, Laxalt tapped his friendship with notorious Chicago financier Delbert Coleman — whose propensity for stock manipulation forced him to lose his casino license — for an introduction that led to loans without many strings from the First National Bank of Chicago.

Friendships were important to Laxalt. Like all the best elected officials, he made them and used them for his benefit. In a career that found him at the center of power and mentioned as Reagan’s possible vice presidential running mate and even a presidential candidate himself, it was Laxalt’s other friendships that took their toll on his reputation outside Nevada.

The role of friendship was a central theme of an emotional tribute to Laxalt offered recently by his grandson, gubernatorial candidate Adam Paul Laxalt. Whether the grandson knows Nevada well after residing in the state such a short time remains unclear, but he appears to appreciate his grandfather’s better angels.

“My grandfather was the rare man in the arena that never lost sight of who he was or where he came from,” he said in a statement. “It is said that our lives are best remembered not by our achievements but by how we treated others. In the course of my life, thousands of people have taken the time to tell me that they knew my grandfather. Without exception, they have used words like decent, genuine, honest, humble and kind. He was indeed all of those things. To those closest to me, my grandfather was both a light and a compass: a testament to what a man should be. To me, my grandfather was the ultimate role model, and much of what I know about being an American, a citizen and a leader, I learned from him.”

Paul Laxalt cherished his friendships and balanced his accomplishments with his compromises to make an indelible mark on Nevada beyond the darkened windows of a haunted hotel.

John L. Smith is an author and longtime columnist. Contact him at [email protected]. On Twitter: @jlnevadasmith.