CARSON CITY -- Gov. Jim Gibbons and Attorney General Catherine Cortez Masto clashed Tuesday when the governor objected to paying the legal expenses of former Nuclear Projects Agency Executive Director Bob Loux.
Gibbons said the state should not be paying $20,000 to cover legal expenses incurred by Loux to fend off a complaint filed against him with the Ethics Commission.
Instead of paying his legal costs, the attorney general's office should prosecute Loux on criminal charges, Gibbons told Masto during a Board of Examiners meeting. Both serve on the commission.
The administration contends Loux over at least a three-year period gave himself and his staff salary increases far beyond what they were legally entitled to receive.
For example, they allege Loux paid himself a $151,542 salary last year, nearly 33 percent more than the $114,088 he was entitled to receive by law. Governors in Nevada are paid $141,000 a year.
"Should the state of Nevada be defending someone who violated the state law?" Gibbons asked.
While defending her decision to cover Loux's legal costs, Masto revealed that the Washoe County Sheriff's Office is investigating whether criminal charges should be brought against Loux.
She added that Carson City District Attorney Neil Rombardo has agreed to prosecute if Loux is indicted on criminal charges. Rombardo is a former deputy attorney general.
The attorney general reminded Gibbons, a non-practicing lawyer, that Loux is innocent until proven guilty.
Masto also mentioned that Loux stated in documents given to the Ethics Commission that Andrew Clinger, Gibbons' budget director, authorized the salary increases he gave himself and his staff.
Clinger, in an interview, flatly denied that allegation and expressed amazement that Loux had made it.
Masto said that she would prefer not to provide funds for Loux's defense, but that she had no choice under state law.
"In no way do I condone the actions taken by Mr. Loux," Masto said. "I share your concerns."
With Masto and Gibbons unable to reach a compromise, Secretary of State Ross Miller requested that the issue of spending $20,000 on Loux's defense be postponed to a future Board of Examiners meeting. Miller is the third member of the commission.
His proposal was accepted by Gibbons and Masto without comment.
Loux has denied he paid himself and his staff anywhere near what Gibbons and his staff have reported they found in an audit of his agency.
But he did say in a legislative hearing that he converted the salary of an employee who quit into 16 percent pay increases for himself and his staff.
It was discovered they were receiving additional pay after Loux went before the Interim Finance Committee in September to seek $72,000 to cover retirement and other benefit increases that he did not calculate when he changed payroll records to increase their salaries.
Masto added that her office has a longtime record of working with Loux on cases involving the Yucca Mountain nuclear waste disposal project. That poses potential conflicts of interest, she said.
Loux ran the Nuclear Projects Agency for more than 23 years, acting as the state's principal opponent against the Yucca Mountain Project, 100 miles northwest of Las Vegas.
Because of the potential conflicts of interest, Loux has hired private lawyers, including former state Budget Director Judy Sheldrew, to represent him with their fees paid by the state.
Masto said about $8,000 already has been spent on those lawyers and the Board of Examiners had no choice but to approve a contract change to bring that total to $20,000.
Loux's appearance on March 12 before the Ethics Commission can lead only to civil fines against him. The complaint against him was filed by Assembly Minority Leader Heidi Gansert, R-Reno, after the Interim Finance Committee hearing.
Contact Las Vegas Review-Journal Capital Bureau Chief Ed Vogel at evogel@ reviewjournal.com or 775-687-3901.