Coalition votes to file lawsuit
The Clean Water Coalition will sue the state to block the taking of $62 million from a fund earmarked for a proposed wastewater project in the Las Vegas Valley.
Board members voted 3-1 on Thursday to file a lawsuit as soon as Gov. Jim Gibbons signs the bill that would allow the state to pull money from the coalition.
Chairman Larry Brown said he didn't begrudge lawmakers' efforts to balance the state's budget but argued they shouldn't take local money collected specifically for water quality improvements.
"It sets a bad precedent," Brown said.
The money was set aside for development of an $860 million pipeline designed to carry treated effluent from the valley's sewage plants to a spot at the bottom of Lake Mead.
Although the board has shelved the project, known as SCOP, the money should go to another water project or be refunded to users, said Chip Maxfield, the coalition's general manager.
The Legislative Counsel Bureau recently completed a legal review and found nothing to prevent the state from taking money from the coalition.
"It's our opinion that the Legislature has the authority to do this," said Lorne Malkiewich, director for the counsel bureau.
The $62 million fund transfer is part of larger budget measure Gibbons is expected to sign today.
Gibbons said his administration was told by legislators that officials in Clark County agreed to allow the state to take the funds.
"It was not our idea but a legislative approach," the governor said.
With the water funds, legislators took $25 million in capital projects money from the Clark County School District to help cover part of a revenue shortfall of more than $800 million.
Also, as part of a bill Gibbons signed Thursday, state transportation officials will be allowed to use an estimated $25 million a year in revenue raised through a Clark County bond issue for highway construction throughout Nevada. The bill is designed to create jobs statewide by using the revenue to create a $500 million bond program for highway construction.
Gibbons maintained that "individuals from Clark County" gave their consent to let the state have the funds in each case. He did not identify the individuals.
Attorney Chris Kaempfer, outside legal representative for the M Resort in Henderson, said last week that the owners of the hotel-casino were considering their own lawsuit against the state over the connection charges and service fees they have paid into the Clean Water Coalition.
On Thursday, political consultant Sig Rogich, who performs government relations work for M Resort, said Chief Executive Officer Anthony Marnell III was still weighing his options but could have an announcement to make today .
Daniel Burns, Gibbons' communications director, said gaming companies that intend to sue the state over the $62 million should be wary, considering a proposal by state Senate Majority Leader Steven Horsford, D-Las Vegas, to find funds through additional gaming industry fees.
Henderson City Councilman Steve Kirk, who serves on the Clean Water Coalition board, said the regional agency could face lawsuits from taxpayers if it allows the state to raid its coffers.
"We all feel bad for the state, but it's not the job of the Clean Water Coalition to balance the state's budget," Kirk said.
Bob Marshall, the coalition's general counsel, said the state has no legal right to take the funds because local users paid the fees expecting the money to be used for enhancing water.
"It's paid for by people in the valley for people in the valley," Marshall said. "And not for the entire state."
Las Vegas City Councilman Steve Ross cast the only vote against suing the state. He called the legislative money grab "unfortunate," but he doesn't think lawmakers had much of choice.
"I'm not a big fan of filing lawsuits and creating more mayhem in the public's eye," Ross said. "The state is going to balance the budget one way or the other. If they don't get the money from the Clean Water Coalition, they'll get it from somewhere else."
The Clark County Water Reclamation District and the cities of Las Vegas, Henderson and North Las Vegas formed the Clean Water Coalition in 2002 to develop the wastewater pipeline to Lake Mead.
The coalition recently suspended preliminary work on SCOP because declining growth and advances in sewage treatment have reduced the need for the project.
The board voted last month to stop collecting connection fees from new homes and businesses that hook up to sewer systems in the valley.
Review-Journal Capital Bureau Chief Ed Vogel contributed to this report. Contact reporter
Henry Brean at hbrean@reviewjournal.com
or 702-383-0350. Contact reporter Scott Wyland
at swyland@reviewjournal.com or 702-455-4519.
