Court intervention sought to seize funds from Clean Water Coalition

CARSON CITY -- Nevada officials want the Supreme Court to order the Clean Water Coalition in Clark County to turn over $62 million the state needs to balance its budget.

In a 31-page legal document filed late Thursday, attorneys for the Legislature and Gov. Jim Gibbons point out that the Clean Water Coalition is a "political subdivision of the state," and as a political subdivision, it is "always subject to the overriding sovereign control of the state and that state may require the transfer of CWC's surplus property ..."

The Clean Air Coalition voted last week to sue the state over the law passed by the state Legislature at the special session that ended March 1 to take the money, which comes from connection fees charged developers.

The money was supposed to be used to construct an $860 million pipeline to carry treated effluent from sewage plants in the Las Vegas Valley to the bottom of Lake Mead. The project, however, was shelved before the Legislature acted.

To cover a revenue shortfall of more than $800 million, legislators and Gibbons approved a bill that cut state spending, increased fees, took money from state trust funds, and pursued the Clean Water Coalition money.

"Through the enactment of (Assembly Bill 6), the CWC is now required by law to transfer a portion of its surplus property to the state to fund the general operation of government," according to the state petition.

Deputy Legislative Counsel Kevin Powers and Deputy Attorney General Wayne Howle also mention that the U.S. Supreme Court "in numerous cases over the past century" has held that political subdivisions created by the state "cannot raise constitutional claims against the state, its creator, for the taking of property without due process of law ..."

In voting to sue the state, Clean Water Coalition Chairman Larry Brown said he didn't begrudge legislators for seeking ways to balance the budget, but that the money taken was promised for water quality improvements.

Chip Maxfield, the coalition's general manager, said the money should be used for another water project, or returned to the residents, businesses and government entities that paid into the fund.

Supreme Court spokesman Bill Gang on Friday said justices will issue a schedule for parties in the case to file additional legal arguments. The court could decide to request the parties appear for oral arguments, or just issue an order, he said.

Earlier, state Budget Director Andrew Clinger said the $62 million is not needed until the new fiscal year begins July 1.

Reporter Henry Brean contributed to this report. Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.