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September 2, 2014

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Reno sides with Southern Nevada in Legislature battle

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CARSON CITY – The city of Reno, fearing it could be a target in the future, is jumping into the legal fray to help Southern Nevada governments in their battle against the state in a $62 million case.

Reno has filed a “Friend of the Court” brief asking the Nevada Supreme Court to “strongly reject” the attempt by the Nevada Legislature to take $62 million collected in Southern Nevada for sewer projects.

The Clean Water Coalition is composed of Las Vegas, North Las Vegas, Henderson and the Clark County Water Reclamation District and it is looking at programs to dispose of treated effluent.

The Legislature, facing a major deficit, voted during its special session earlier this year to take $62 million from the water coalition, which it termed as “surplus.” The coalition denies it is a surplus and has refused to turn over the money. The state and Legislature have filed suit in the Supreme Court to get the money.

The Reno brief, written by Deputy City Attorney Randal Munn, says if the state law is allowed to stand it “may cause the Clean Water Coalition to become insolvent” and terminate the agency.

The initial project of the water coalition called for building a pipeline to transport effluent from the local treatment plants to Lake Mead and to generate hydroelectric power from the effluent carried in the pipeline.

The coalition decided to suspend work on the project until 2012 due to the economic decline, lack of growth and current effluent treatment standards.

Reno says taxes imposed for the benefit of the state must be “general in nature.” And the Legislature, if this law is upheld, could convert local fees into state taxes.

In his brief on the impact of the law on local governments, Munn says there is a Truckee Meadows Water Authority formed of local governments in the Reno area to purchase the water system of Sierra Pacific Resources. And the Legislature could hit on that agency.

The state says, however, there is a “clear and present legal duty on the Clean Water Coalition to make the transfer.” It said the coalition can't ignore the state law.

The law, according to the state brief written by Senior Principal Deputy Legislative Counsel Kevin Powers, is “a valid exercise of state sovereign authority over political subdivisions.”

The state has a constitutional obligation to balance its budget and the refusal to transfer the $62 million "impairs the state’s access to financial resources necessary to provide vital services to the public," the state argues.

The battle between the state and local governments is expected to be set for oral arguments sometime this summer.

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