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Lawsuit could determine Nevada regulators' ability to curtail water rights

In this June 16, 2016, photo, shrubs grow on empty housing pads at the Coyote Springs golf course in the Coyote Springs development, about 50 miles northeast of Las Vegas. Before the housing bubble burst, developers planned to create a new community in the desert with thousands of homes, several golf courses and other amenities. But the housing bubble burst, with only the golf course completed before the project stalled. (AP Photo/John Locher)
John Locher
/
AP
In this June 16, 2016, photo, shrubs grow on empty housing pads at the Coyote Springs golf course in the Coyote Springs development, about 50 miles northeast of Las Vegas. Before the housing bubble burst, developers planned to create a new community in the desert with thousands of homes, several golf courses and other amenities. But the housing bubble burst, with only the golf course completed before the project stalled. (AP Photo/John Locher)

A trial that some say could cripple Nevada’s ability to regulate water within the state began in a Las Vegas courtroom this week.

For decades now, developers and the state have gone back and forth over Coyote Springs. That’s a development about an hour northeast of Las Vegas. No one lives there, and that’s largely because years ago, the state engineer declared there wasn’t enough water. That decision was backed by the Nevada Supreme Court.

Now, the Seenos, developers from California who are the sole owners of the development today, are seeking restitution for all the money they invested in the project. They claim the state essentially stole their water rights.

The lawsuit could potentially cost the state billions.

"If it is determined that these water rights were indeed property that was taken by the state, then [the plaintiffs] believe they need to be compensated for it," said Las Vegas Review-Journal environmental and water reporter Alan Halaly, who is covering the trial.

Halaly said it could have a chilling effect on how the state engineer regulates water rights moving forward.

"The larger question is whether the state engineer will hesitate when doing things like this in the future," said Halaly. "And if this does prevail, as you know, the state doesn't have a lot of extra money to be doling out billions of dollars to developers who are mad about water rights."

The suit is currently before District Judge Mark Denton. The trial is expected to take months.


Guest: Alan Halaly, environmental and water reporter, Las Vegas Review-Journal

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Paul serves as KNPR's producer and reporter in Northern Nevada. Based in Reno, Paul specializes in politics, covering the state legislature as well as national issues' effect in Nevada.