Both sides have filed for summary judgment in the battle over $62 million originally collected for a Southern Nevada sewer project.
The fight started after the 26th Special Session of the Nevada Legislature voted to sweep that money out of the Clean Water Coalition account and use it to help cover the state budget shortfall. M Resort filed one case arguing that since the money was collected from users of wastewater systems in the Las Vegas Valley, it would be unconstitutional to take the money and use it for other purposes.
"The confiscation of the Clean Water Coalition's funds was accomplished through an unconstitutional special and local law, is an unconstitutional taking of private property," the M Resort motion argues, saying the Legislature illegally converted fees collected from Southern Nevada residents into a tax.
M Resort wants the money returned, not taken by the state.
The Clean Water Coalition made a similar argument, adding that an advisory question put before Southern Nevada voters approved those fees to do water projects in the south, not to fund state government.
Lawyers for the attorney general's office and Legislative Counsel Bureau argue the coalition is a political subdivision subject to "the overriding sovereign control of the state." The state brief says the coalition can't raise constitutional claims against the state and, because it is a political subdivision of the state, can't challenge the transfer of property - in this case, the money.
"Courts have held that a state Legislature, as the policy-making body with the constitutional power to allocate and reallocate limited public resources, has the authority to transfer fees collected for a specific purpose to the state's general fund to meet the state's changing fiscal needs and priorities," the brief argues.
State lawyers also point out that the project planned for the money was canceled so the cash isn't needed for that purpose anymore and is available for other uses.
The battle is being waged in Clark County District Court but no matter who wins, is expected to be appealed to the Nevada Supreme Court.
In the meantime, the inability to count on that money has left an additional $62 million hole in the state budget, which is already looking at a shortfall of up to $3 billion.