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Water Rates Should Be Decided in Court Not in The Press

Mesquite, NV Aug. 27, 2018. Here we go again.  More disparaging remarks from local hack writer Barbara

Barbara Ellestad

Ellestad about one of the nations top rate golf courses located in Mesquite.

Ellestad who masks her opinions as news articles for the twice weekly Mesquite Local News (MLN) opines that legally challenging rate setting by the Virgin Valley Water monopoly is somehow harmful to the public.      

Her broadside attacks against Paradise Canyon (Wolf Creek)[i] have become part of their move to push the case against the Virgin Valley Water Board (VVWB) to trial. According to Paradise, Canyons attorney’s what “is being reported on by the MLN, and the aspersions cast by VVWD have already been published to the local citizenry to arouse local animus against Paradise Canyon.”

In her August 23rd opinion article in the MLN Ellestad, who once served on the VVWB,  seemed to argue that a 500% rate increase on Wolf Creek by the VVWB is a good thing. On-the-other hand, Paradise Canyon attorneys suggest that such a rate increase violates the good faith and dealing provisions required by Nevada contract law.

If anything, the public should complement Paradise Canyon owners for paying the costs to bring rate increase issues before the court. It was the public who suffered a 40 percent increase in 2010, a 38 percent increase in 2015 along with a $10 per month surcharge on water services. These rate increases come from elected officials arguing that they have complete authority to set water rates at any price they want. Their untethered authority also applies to their spending power.  

These rate increases are needed to cover the spending of over 12 million dollars for Virgin River water shareholders of the Mesquite Irrigation Company (MIC) and the Bunkerville Irrigation Company (BIC).  

Delivering water to Wolf Creek is 100% profit for the VVWB.   They do not generate or distribute the irrigation water, nor do they provide any infrastructure to irrigate the golf course. They serve as a middleman leasing MIC and BIC water for a profit. They add nothing to the transaction.

The owners of Paradise Canyon (Wolf Creek) bear the costs. They pay $43,000 per year for irrigation water and $130,000 per year for drinking water, placing it on VVWD’s Top Ten List of all local businesses for portable water charges. 

If the VVWB gets away with their price gouging, Paradise Canyon owners become the number one ratepayer for potable and non-(irrigation) potable water in the area, surpassing the casinos, the School District and even the City of Mesquite itself.

The owners of Wolf Creek say they are willing to pay a higher price but think that a 500% increase is too much. 

Ellestad’s current harangue falls into two categories.  One, she wants the public to believe that the VVWD is not a monopoly. She thinks that characterizing the water district as a monopoly is silly. Two, she wants the public to believe that Paradise Canyon violated a 2011 agreement to use city provided waste water (effluent) before using irrigation water provided by the VVWD. 

She claims that: “there are more than 100 different owners of irrigation shares in the Virgin Valley and Wolf Creek has many different options for obtaining irrigation water.”  It is not that simple.

The current ditches, pumps, and pipes that provide water to Wolf Creek were paid for and are operated by the owners of the Golf Course.  Paying for a new infrastructure from other diversions is cost prohibitive.

Ellestad and Mesquite City Attorney Robert Sweetin are twisting the facts when it comes to discussions and agreements about the use of city leased waste water (effluent) to irrigate the Wolf Creek golf course.

In her August article, Ellestad quotes Sweetin as saying that “I am informed (by Ellestad?) that Wolf Creek has alleged that the City does not have effluent available for Wolf Creek. Such a claim is false. The City does have effluent available for Wolf Creek.”

Sweetin then threatens Wolf Creek. “If Wolf Creek continues to refuse to accept the available effluent, the City may take action against Wolf Creek for breach of the Agreement.”  

Here are the facts. On August 19, 2011, George N. Benesch, acting as the attorney for Paradise Canyon wrote a letter to Kurt Sawyer, Interim Mesquite City Manager. Benesch was attempting to clarify certain conditions on September 18, 2001, 10-year effluent agreement between the City and Paradise Canyon.

According to Benesch (see letter below) the city, unbeknown to Paradise Canyon had either purchased or was about to purchase land for the pump station needed to distribute waste water. The city wanted Paradise Canyon to pony-up $15,000 for that purchase.  According to Benesch, that purchase “is one of some reasons Paradise Canyon has not added the necessary infrastructure to allow the City to bring effluent to a Paradise canyon pumping state over the past decade.”

Benesch question the availability of effluent to meet the agreement amounts In his letter to Sawyer Benesch recounted a discussiong with Bill Tanner, the City’s Public Works Director. According to Benesch, Tanner said that all the city’s effluent was committed, and no effluent was presently available for Paradise Canyon use. Except, he said for a minimal amount in December, January and February.

When Benesch ran the numbers, he concluded that the city, at that time, was from .25 to .75 million gallons per day short of meeting its current requirements the Oasis, and Falcon Ridge Golf Course and meet the City’s own demand for effluent.

The attorneys for Paradise Canyon (Wolf Creek) are simply asking, as a matter of legal fact, if the VVWB is acting in good faith as required by contract law in their rate setting activities.

This case should be decided on its merits without the burden of overcoming aspersions and fake news designed to arouse local animus against the areas number one golf course.

Effluent Notice Resp ltr (1)

Endnotes:

[i] Wolf Creek finished third in Golf Digest’s survey of America’s Best New Upscale Public Courses of 2001, behind Pacific Dunes and Arcadia Shores. All three are now ranked in Golf Digests top 50 National Golf courses.

About Author

Michael McGreer Mesquite, Nevada
Dr. Michael Manford McGreer is managing editor of Nevada-today.com and writes on issues that impact public policy.

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