Gov. Jim Gibbons said Monday he will attempt to bring construction parties together in a step to resolve a dispute with MGM Mirage about CityCenter in a meeting this month.
“When you look at this issue, there are large businesses that are involved, there are small businesses that are involved,” Gibbons said. “But most importantly, there are people’s lives involved with this, and I will do anything to help solve this problem.”
The May 21 meeting will be in response to a nine-page letter sent May 3 by general contractor Perini Building Co. asking Gibbons to investigate why project owner MGM Mirage is not paying nearly $500 million the builder claims it and nearly 600 subcontractors are owed.
State legal counsel is reviewing the letter to see whether the state has any statutory authority to act in the dispute, the governor said, and hopes to have an answer by the time of the meeting.
Gibbons said his office has not been contacted by MGM Mirage about this matter.
Alan Feldman, MGM Mirage’s senior vice president of public affairs, said Monday that the dispute between the gaming company and the builders rests on two points Perini doesn’t seem interested in addressing honestly: settlement of outstanding construction charges of which Perini delivered final billing only last week, and MGM Mirage’s claim of negligence at the Harmon Tower.
“These matters are before an impartial third-party and will be resolved in due course,” Feldman said. “Any attempts by Perini to malign the reputation of MGM Mirage is simply a distraction and can only delay expedient resolution of our differences.”
The “third-party” refers to a lawsuit Perini filed March 24 in Clark County District Court against MGM Mirage and its CityCenter subsidiaries. Perini has also filed a master lien against the project for $500 million and subcontractors have continued to file individual liens.
MGM has until later this month to respond to the lawsuit.
Perini Building Chief Executive Officer Craig Shaw said he hopes Gibbons can help expedite a resolution.
The company will also be releasing correspondence between Perini and MGM Mirage to a Facebook page to show Perini has been seeking payment for work it claims was performed on time as promised, Shaw said.
“For many months, MGM Mirage has refused in good faith to negotiate our change orders,” Shaw said. “MGM Mirage needs to do the right thing and stop avoiding its responsibility.”
A coalition of Perini, the subcontractors and a few local trade unions put together the Facebook page.
Las Vegas-based construction attorney Dennis Haney said the governor should encourage some sort of mediation and avoid a lengthy trial.
“They’re not going to agree on everything, but you can have get into some of the issues that they can agree on in order to avoid court,” Haney, who works for the law firm Santoro, Driggs, Walch, Kearney, Holley & Thompson said. “Instead of a six-month trial, you can have a two-month trial. And the results (from the mediation) can be private.”
Mandi Lindsay, government affairs director for the Associated General Contractors of Las Vegas, said the dispute could lead to tighter lien laws to protect subcontractors being introduced at the next state legislative session.
“We are looking at amending current lien laws during the upcoming 2011 Legislature, but it is too early to say exactly what that language would entail,” Lindsay, who has some members in the dispute, said. “As this thing with MGM Mirage drags out, we will attempt to make some consideration for it in the proposed legislation as we move forward with this.”
Former Nevada state Sen. Warren Hardy, president of the nonprofit lobbying group Associated Builders and Contractors, said the governor must be sincere in wanting to help because there is not a political upside for getting involved.
“I don’t think there is anything the governor can do,” Hardy said. “Although it’s sometimes good to have a high-level person to mediate.”
Gibbons said he is not concerned about stepping into a political minefield during an election year.
“My goal, my worry, my concern are the people who are out of work in this state,” Gibbons said. “That needs to be looked after. I want to make sure people are being treated fairly, that businesses are able to stay in business.”
Contact reporter Arnold M. Knightly at
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