1. The Commission shall prepare and approve a water administrative and operating budget. The budget must include all costs and expenses incurred by the Commission in performing its functions and duties relating to water, except:

(a) The costs and expenses related to any financial obligations or other obligations assumed by the Commission pursuant to any agreement described in paragraph (a) or (b) of subsection 6 of NRS 538.161.

(b) The costs for any services of an independent contractor related to a specific opportunity to negotiate and enter into an agreement to acquire any interest in supplemental water from one or more particular sources, to the extent all those costs for those opportunities during the period covered by the budget exceed $200,000. This amount may be decreased or increased as indicated by engineering cost indexes or other cost indexes which are applicable to the services used by the Commission.

(c) The costs for any services of an independent contractor or costs contributed by the Commission for any services of a governmental agency or its independent contractor, other than the Commission, for studies or the implementation of projects relating to water quality, evaluation or enhancement of ecological habitat or weather modification, to the extent that all those costs for those studies or projects during the period covered by the budget exceed $250,000. This amount may be decreased or increased as indicated by engineering cost indexes or other cost indexes which are applicable to the services used by the Commission.

(d) Costs which are capitalized in accordance with generally accepted accounting principles, except costs for office space and equipment required for the principal place of business of the Commission.

(e) Costs for the operation of any facility which belongs to the Commission, except the principal place of business of the Commission.

2. The water administrative and operating budget, and any changes to the budget, must be submitted for authorization in the manner prescribed by the State Budget Act. If the budget is authorized, the budget is payable by, and becomes a liability of, each water purveyor in the amount, if any, to which the budget is allocated to that water purveyor pursuant to subsection 3.

3. The Commission shall allocate the entire amount of each water administrative and operating budget, minus the portion of that amount which represents the net revenues which the Commission estimates it will receive pursuant to its contracts from the sale of water during the period covered by the budget, among those water purveyors which the Commission determines will directly and substantially benefit from the Commission’s activities which are related to water during that period. In determining the allocation, the Commission shall consider appropriate factors relevant to those benefits. If a water purveyor ceases to exist during the period covered by the budget, the Commission shall amend and reallocate the budget as necessary.

4. In each fiscal year covered by the water administrative and operating budget, each water purveyor to which the Commission has allocated an amount of the budget pursuant to subsection 3 shall pay to the Commission quarterly a portion of the water purveyor’s total liability for that fiscal year as billed by the Commission. At least 60 days before the first day of the quarter for which the bill is prepared, the Commission shall submit to each water purveyor a bill for its portion of the total amount of the budget due for that quarter. Each water purveyor shall pay its bill within 30 days after the bill is submitted by the Commission.

5. Except as otherwise provided in this subsection, the Commission shall apply, within 120 days after the end of the fiscal year, any unexpended balance in the budget at the close of the fiscal year as a credit to that amount allocated among the water purveyors pursuant to subsection 3 for the next fiscal year. The Commission shall apply that credit to the next quarterly payments remaining due from each water purveyor, unless the Commission determines it is appropriate to refund the unexpended balance.

6. If in any fiscal year the money payable by a water purveyor pursuant to subsection 4 is not received by the Commission when due, that money also becomes the several liability of all public entities who:

(a) Purvey water; and

(b) On the date the budget was approved by the Commission, were members of the water purveyor liable for that money,

in proportion to their liability for the budget of the water purveyor effective on the date the budget was approved by the Commission.

(Added to NRS by 1995, 968)