Quarrel over stimulus czar simmers on

CARSON CITY -- The Gibbons administration and legislators continued to take swipes at each other Thursday in a partisan dispute over who should control the state's yet-to-be-named "czar" over federal stimulus funds.

Legislators decided last week to put the funds manager in the office of Democratic controller Kim Wallin. Republican Gibbons wants the czar under his control and this week refused to allow state agencies to work with Wallin.

"I cannot believe the administration is putting us in a position which jeopardizes the reporting and receipt of these funds," said Assemblywoman Debbie Smith, D-Sparks. "I was hoping the whole issue would simmer down."

Gibbons spokesman Daniel Burns said, "There could be a three-month to six-month delay in the receipt of funds because of the Legislature. You can't just take the files we have been working on and hand them over to the controller."

What is at stake now is meeting an Oct. 10 deadline for the stimulus funds manger to report to the federal government that the funds Nevada already has received were spent as designated, Burns said.

He said the federal government had determined that Nevada state and local governments will receive $2.2 billion in American Recovery and Reinvestment Act Funds. The state already has gotten $500 million, mainly for jobless benefits and Medicaid.

States must meet requirements by deadlines to trigger the release of additional federal funds. Funds generally are released in phases as agencies meet the requirements.

Burns said Gibbons will announce today the "extraordinary action" he intends to take to speed up the transfer of stimulus funds to Nevada. Actions Gibbons will take don't include challenging the legal authority of the Legislature's Interim Finance Committee to place the stimulus czar in Wallin's office. Gibbons had hinted at a lawsuit against the Legislature.

The Interim Finance Committee includes 21 legislators who handle financial business when the Legislature is not in session. The committee's authority to act on behalf of the 63-member Legislature has not been challenged in court.

At the committee's Aug. 3 meeting, Democrats decided on a party-line vote to spend about $200,000 to allow Wallin to hire a stimulus czar and an assistant to oversee the expenditure of the stimulus funds.

Gibbons had wanted the person to work in his office or within the state budget office, which he supervises.

But Senate Majority Leader Steven Horsford, D-Las Vegas, won approval to put the employees under Wallin. Her office oversees state expenditures.

At that meeting, Smith said putting the czar in Wallin's office would provide the checks and balances to ensure money was properly spent.

On Wednesday, Gibbons directed state agency heads not to report to the controller's office on their handling of stimulus funds.

Robin Reedy, Gibbons' new chief of staff, said agencies will report stimulus activity to the budget office, which will forward the information to the controller, who can provide it to the federal government.

Burns said the dispute would end if the Interim Finance Committee agreed to place the stimulus czar within the budget office. The committee does not meet until Sept. 17.

Smith agreed the budget office option should be considered.

Contact Capital Bureau Chief Ed Vogel at evogel@reviewjournal.com or 775-687-3901.