‘No one can build anything,’ water storage limitations prevent developments in Laughlin

by: Ryan Matthey

Posted: Aug 30, 2023 / 06:44 PM PDT

Updated: Aug 30, 2023 / 07:08 PM PDT

LAS VEGAS (KLAS) – A water war is underway in Laughlin as existing storage limitations prevent local developers from building any new homes, while who should bear the cost of expanding it remains contingent.

THE PROBLEM

Peake Development, for one, has already built 228 Laughlin homes between their communities of Cottage Hill and Cottage Court. Spokesperson Carrie Larson says they brought the concept of RV garages to the area in 2000, which has spiked the interests of those primarily out of state and retired people looking for a big home with a small-town feel.

But, they’re likely not building anymore any time soon, despite an additional 40 acres of Cottage Court laying barren.

The Las Vegas Valley Water District (LVVWD) told developers, like Peake Development, that the current water system cannot support new significant growth unless additional storage is created.

That means purchasing at least one two-million-gallon storage tank, which is estimated to cost between $10 million to $12 million. Two of these tanks may be necessary, however, depending on how the extra development impacts fire flow needs on underground pipes, according to an LVVWD official.

Developers, like Larson, were told that they would need to pay for it if they wanted to continue developing.

“They’re asking us to fork over $11 million to use about seven and a half percent of that water storage,” Larson said, standing in between newly developed homes and the 40 empty acres of land next to them. “There’s too many small parcels in Laughlin that aren’t able to absorb those kinds of costs to develop, which basically means you can’t develop and now your land is worthless.”

While not officially considered a ‘growth moratorium’ – which would require a vote by the governing body of the area – those like Martin Knauss, president of the Laughlin Economic Development Corporation, believe it effectively prevents growth in the township of under 9,000 people.

Knauss says that as development stagnates, property values and the property taxes that help pay for town services are lessening.

“If you can’t build anything, those values will fall,” Knauss said inside his office. “It might work in places in the Las Vegas Valley where 10,000 dwellings are going to be built, but we don’t have that kind of— we’re hemmed in by government lands, a national monument, BLM lands.”

“No one can build anything unless we get this water storage issue fixed,” Larson said, acknowledging that she and other developers cannot afford to finance even one tank.

THE CONTEXT

LVVWD, which operates the potable water provider for the township, Big Bend Water District (BBWD), assumed operations for the area in 2008 at the direction of the then Clark County Board of Commissioners. The water system was grandfathered into storage requirements then, which are different from requirements for new systems under Nevada law.

If established now, 10.5 million gallons of water storage would be required. LVVWD’s Deputy Manager of Engineering, Doa Ross, says BBWD currently only has six million gallons worth of storage capacity between four different tanks.

“We know we’re deficient by four million gallons worth of storage,” Ross said inside a Las Vegas hotel conference room during an 8 News Now interview. She acknowledges that the current system and storage can adequately support current water demands.

Their treatment plant along the Colorado River can treat up to 15 million gallons a day, meaning it could hypothetically provide the water for the extra water storage when created. Two-thirds of the current storage is for domestic use, with the other third reserved for fire response.

Ross’ concern is not leaving enough storage for those fire needs, as the township is roughly an hour and a half away from LVVWD facilities in the Las Vegas valley. She adds that the current fire flow reservation leaves six to 10 hours of water and any developments now would eat into those hours.

Another concern is affording any expansions. Ross said LVVWD officials were aware of the shortfall in storage when assuming operations, though adds there was no room in the then-budget for system upgrades. BBWD’s accumulated debt as of May 31, 2023, is roughly $3.2 million.

When it came to the most recent 10-year capital budget approved in 2017, Ross says the option of expansion was never discussed with Laughlin stakeholders as only $9.184 million were available and just one tank would ignore necessary improvements on the system. 19 other smaller improvements were completed and are in progress instead.

“We made the decision to go off of the multiple, smaller, high-impact projects that benefit everyone in Laughlin,” Ross said. “The additional storage would benefit the community too, but it wasn’t as much of a priority as things like those PRV’s (pressure reducing valves), as getting an additional backup well, and adding generators to the pumps.”

While long-standing Laughlin developers say they cannot afford the extra storage, Ross adds it’s standard practice for developers to pay for additional infrastructure – like sidewalks, street lamps, stop lights, gas infrastructure, and power connection – when their projects provoke them.

“Without that in the budget or the ability to raise money within Laughlin– Laughlin’s ratepayers are not going to pay for it, it’s not going to be subsidized by the Las Vegas ratepayers– so the only place to pay for it right now is development,” Ross said. “I know it sounds unfair, and it does if you’re a really small developer. But, when you look at it in terms of ‘you’re participating in the overall health of the community that you are also a part of,’ it’s kind of the way we need to look at it, and it’s the way we do things even within the (Las Vegas) valley.”

THE SOLUTION

Ross says LVVWD does not qualify for loans because it would be unable to pay them back per its deficit. Instead, attention has focused on “free money”: principal forgiveness or state grants.

During the August 8 Laughlin Town Advisory Board meeting, Jason Bailey with LVVWD announced the district has applied for ARPA funding (also known as COVID-relief funding) through the Nevada Department of Conservation and Natural Resources. If approved, the $12 million ask could fund the first storage tank in its entirety.

While LVVWD awaits to hear on the status of this grant by the end of September, Ross is hopeful of approval as Clark County Commissioner Michael Naft has also sent a letter to the state urging them to prioritize this request. She acknowledges too that they are up against the other 600 public water systems in the state, and that they would need to continue searching for “free money” if not approved.

“The ratepayers made it very known that they don’t want to pay for this, and the ratepayers in Las Vegas are not going to pay for it either, so someone has to come up with the money,” Ross said.

THE PROBLEMTHE CONTEXTTHE SOLUTION