Gov. Jim Gibbons on Friday signed the legislation implementing a series of budget cuts and fee increases to fill an $805 million shortfall in the state budget.
But even before he signed AB6, M Resort in Las Vegas filed suit to block the state from taking $62 million in fees collected from businesses for a water infrastructure project that was later canceled. The Clean Water Coalition voted earlier this week to fight the state, saying that money was collected from businesses for a specific purpose and can't be taken away by the state to balance its budget. Officials at M Resort have been the most vocal opponents to the plan.
Gibbons said he couldn't comment in detail until he sees the lawsuit. He said, however, he would try to fill that hole in the budget plan administratively without calling another special session of the Legislature.
"It's the best thing we can do for Nevada at the current time," said Gibbons of the bill, adding that "it may not be what everybody wanted."
Gibbons said he intends to move forward with plans to cut what could be a $3 billion shortfall for the next budget cycle. That would be about half the total general fund spending in this budget cycle.
He said he would "continue our effort to meet some of the recommendations of the Sage Commission." He said that commission has found some $500 million that could be cut from the state budget in "wasteful or duplicative" spending.
He rejected primary opponent Brian Sandoval's charge that Gibbons raised taxes by boosting mining fees and the gaming license investigation fee. He said the mining increase doesn't hit the small miners and simply covers the cost of the services provided.
Likewise, he said the gaming fee increase covers costs of investigating license applicants.
The budget package contains $303.8 million in reductions to operating budgets, $129.4 million in revenue collections and fund transfers - including the $62 million in water fees - $197.4 million in funding swept from state accounts and $114.3 million in federal fund offsets.
It generates about $53.2 million in new fees and gets the final $10.6 million by spending down the general fund ending balance to the minimum allowed as well as taking more reductions to ongoing capital improvement projects.
Altogether, those moves generate $3.2 million more than the $805 million shortfall.