LV may renege on deal to share courts

Thursday, May 20, 2004 | 11 a.m.

The city of Las Vegas wants out of the deal it made to put its seven municipal courtrooms in Clark County's Regional Justice Center, which is more than $15 million over budget and more than two years behind in opening.

Clark County says the city ought to stick to its deal, saying any other arrangement that prevents the city's and county's courts from sharing the same downtown building as "a one-stop shop" for judicial services will "potentially be perceived by the public as deceptive."

The Las Vegas City Council on Wednesday gave City Manager Doug Selby the go-ahead to negotiate with Clark County to potentially get out of the deal for use of part of the unfinished building at South Casino Center Boulevard and Clark Avenue.

The center was to open in January 2002 at a cost of $170 million, but cost overruns have put the price tag at $185 million -- and the final tally isn't in yet. The city was to have moved into the completed structure in December. The projected move-in date is now the first quarter of 2005, county officials say.

"This (talks with the county) is all very preliminary," Selby said after the council passed the measure without comment, as part of the consent agenda, a large group of items deemed to be routine and approved by a single vote. "We want to explore how the city's space can be used by the county."

The city is contracted to pay, through 2024, $2.06 million a year for 76,700 square feet of usable space, 15,000 square feet of potential future expansion space and 30,000 square feet of common area, as well as to pay $1.5 million for its share of maintenance and security costs.

A memo to the City Council from the city manager's office, released as part of the backup material for Wednesday's meeting, says, "under the agreement, the county is now liable for liquidated damages associated with delays beyond ... Dec. 31, 2003. The city is currently assessing its potential claims against the county under this provision."

Selby declined to say that the county is in default. He indicated he did not want the negotiations that the council approved to be perceived as contentious.

Randy Walker, the director of the Clark County Aviation Department, who was put in charge of the construction project when it fell seriously behind because of alleged construction problems, said it was "very late in the game for the city to pull out of the deal."

"The municipal courtrooms for the city were custom designed," Walker said. "For the county to use them, the rooms would have to be gutted and redesigned. Part of the reason for that is that there are no jury boxes in the municipal courtrooms. The rooms just cannot be practically used by the county."

The 17-story building is designed for the higher-traffic municipal courts and justice courts to occupy the lower floors, the District Courts to utilize the middle-to-upper floors and the Nevada Supreme Court to be on the highest floor, Walker said.

He said the county does not need what amounts to seven more justice courtrooms as there are enough built within the current plan, including a floor of so-called "shelled courtrooms," which are partially finished rooms that won't be completed until they are needed for expansion purposes.

The city's portion of the project was built to include six municipal courtrooms and one traffic courtroom, two shelled courtrooms for future expansion, as well as offices for the city attorney and his staff, marshals, court intake, a fines and collections department and administration.

Wednesday's action comes on the heels of Clark County turning down last week the city's offer to give up its space in the Regional Justice Center, along with the nearly $9 million already sunk by the city into the project, in exchange for eight acres of Clark County-owned real estate south of the Clark County Government Center near the city's proposed 61-acre Union Park project.

In a rejection letter dated Friday, Clark County Manager Thom Reilly reminded the city that on Sept. 24, 1992, the city conveyed that undeveloped land near Charleston Boulevard and Grand Central Parkway as part of a 38.8-acre parcel to the county.

"After reviewing ... this proposal we have determined it is not in the best interest of the county to make this exchange at this time," Reilly wrote in his letter to Selby, noting that the Metropolitan Police Department has requested to use that land for an administration building.

Reilly also reminded the city that its commitment to the Regional Justice Center was for far more than the $9 million it has thus far contributed.

"The city's commitment for the RJC was over $33 million and the project financing includes that obligation," Reilly wrote. "The bond conveyance represents that the city's full faith and credit is pledged toward the city's portion of the debt. Absolving the city of this commitment would probably require that the debt be reissued."

Reilly also wrote that under the agreement the city made with the county in April 1998, the city is "responsible for 20 percent of the operating costs of the (justice center) building. These costs would have to be absorbed by the county if the municipal courts do not occupy the building.

"City and county management and elected officials from the courts and the local governments represented and justified the expense of the RJC in part to create a one-stop shop for the public. To separate the courts at this time would eliminate any potential improvements to customer service and potentially be perceived by the public as deceptive."

Reilly said the only other non-county entity involved in the project, the state Supreme Court, has not attempted to pull out of the deal despite the well-publicized construction woes.

He also said that just because he has turned down one offer from the city does not mean that the two sides can't reach some resolution of the situation.

"I would say my talks with Doug have not been contentious at all," Reilly said Wednesday. "We are having ongoing discussions and I understand that he wanted to get the go-ahead from his board to continue discussions."

The county has not paid the justice center contractor in more than a year and is assessing AF Construction Co. $12,000 per day for liquidated damages. Reilly indicated that the city's claims for liquidated losses also likely can be passed on to the contractor. AF Construction last year filed a suit against the county, alleging mismanagement, breach of contract and defamation.

Instead of moving into the justice center, Selby said the city is in the preliminary stages of determining whether to build a new municipal courthouse across from City Hall, near the planned City Hall expansion on the east side of Las Vegas Boulevard at a site that has yet to be identified.