All sources of water within the boundaries of the state, above and below ground, belong to the public [[i]].”
The Virgin Valley Water Board (VVWB) has modified the intent of that statue to read: All sources of shareholder irrigation water held by VVWB will be leased and priced at the sole discretion of the VVWB.
On May 10, 1993 the Virgin Valley Water District (VVWD) was established as a political subdivision of the State of Nevada by shareholders of Mesquite Irrigation Water (MIC) and Bunkerville Irrigation Water (BIC). From that time to today they held a monopoly on 100% of irrigation water derived from the publicly owned Virgin River without cost.
MIC and BIC shareholder hold a barrier to competition through ancestral rights obtained on May 14, 1927, when the Tenth (now Eighth) Judicial District Court, Clark County, Nevada [[i]] affirmed the rights of MIC and BIC shareholders to Virgin River irrigation water acquired by valid appropriation prior to March 1, 1905, and were determined to be in good standing.
Without competition, they decide the price of the water and have generated outrageous profits for their descendants.
These shareholders could have stabilized the market by reallocating their shares, at no cost, for the beneficial use by the community. Indeed, the original intent of the free use of public water was to benefit the community where the water was acquired.
Instead, the descendant shareholders used public dollars to pay other shareholders of public water in amounts ranging from $99.34 per Are Feet Annually (AFA) to $8,836.23 per AFA in 2008.
In total, they gave away $12,159,670.86 of public dollars for 4,992 AFA of public water because their descendants acquired the water to irrigate crops and raise livestock 114 years ago.
The money saved could have been used to invest in research and development, studies of the basin, the development of resources to counter the drought or any other beneficial purpose.
It is these higher monopolistic price setting strategies that drives rate payer increases. Even their current attorney, Jedidiah (Bo) Bingham acknowledges the rate increases by the VVWB. In a recent board meeting, he reported a 40 percent increase in 2010, a 38 percent increase in 2015. In 2015, the Board imposed a $10 per month surcharge on water services. He even acknowledges that “millions of dollars” were spent by various members of the VVWB on MIC and BIC water shares. He intentionally ignores the economic impact those actions had on rate increases, deficit budgets and the lack of infrastructure maintenance dollars.
Instead, Bingham puts the blame on the local golf courses. According to Bingham (in an interview for The Nevada Independent), Golf Courses paying a low rate for (public owned Virgin River) irrigation water harmed other ratepayers. According to Bingham, “Because the golf courses are paying such a low rate [for irrigation water] the district is not recouping as much money as it could if it were leasing the water at a rate closer to where demand is.
“Every dollar that the district loses is one more dollar that the ratepayers across the valley have to pay to effectively subsidize the low rate to the golf courses,” Bingham told the Nevada Independent.
What Bingham says is fundamentally flawed and deceptive. The current irrigation rate for golf course water is $34.82 per AFA until January 1, 2020. On New Year’s Day, the VVWB wants to raise the rate to $90.53 per AFA and increases the rate gradually to $109.84 per AFA by 2036.
Remember we are talking about publicly owned water with an actual price of zero if allocated as it was originally intended to benefit the community.
Had that been done, a non-shareholder VVWB could have added administrative costs and delivered the water for irrigation at rates close to the average of off-Farm Surface Water ranging from $7.20 per Acre Foot Annually (AFA) in 2008 $13.60 per AFA in 2013.
Board members Richard Bowler, whose family has shares in irrigation water, and Nephi Julian, whose sister is married into the Hafen family, who are major irrigation shareholder, pushed the golf course deal thus obfuscating the real reason for rate increases while continuing to inflate irrigation share values.
Past and current practices of the VVWB appear, at a minimum, a violation of Federal and State antitrust laws. These are a collection of federal and state government laws that regulate the conduct of both public[ii] and private organizations to promote fair competition for the benefit of consumers.
The public record is clear. It was Sam Reber, J.L. Bowler, Cresent Hardy, Cecil, Vinnie and Kathryn Leavitt, Paul Jensen, Harold Wittwer, Bill Tanner, Michael Waite, Charlene Hughes, Kraig Hafen, Dave Bennett, Robert Anderson, John Paul, Ted Miller, Robert (Bubba) Smith, Karl Gustafson and Mark McEwen who set the irrigation water prices that impact rate payers to this day.
Bingham is right when he says: “Every dollar that the district loses is one more dollar that the ratepayers across the valley have to pay.” He is not correct in saying that the district loses money because the golf courses pay less.
The increase in rates lies directly at the foot of MIC and BIC shareholders who used public dollars to push irrigation water rates from zero to amounts as high as $8,836.23 per AFA.
Prices will continue to rise if the public continues to elect board members with strong familiar ties to shareholders.
VVWB purchase history links
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[i] Judgment and Decree in the Matter of the Determination of the Relative Rights in and to the Waters of the Virgin River (Virgin River Decree) was entered on by the Tenth (now Eighth) Judicial District Court, Clark County, Nevada.
[ii] In 1983 The California Supreme Court ruled that reasonable and beneficial uses of water must be interpreted according to public trust needs.