Eminent domain-taken land near airport to be returned

Bill Gang

Thursday, Dec. 3, 1998 | 11:22 a.m.

A chunk of land along Tropicana Avenue that had been seized under eminent domain because of a new McCarran International Airport runway is being returned to the owner.

Yet a question remains for a District Court jury: How much is the convoluted maneuvering over control of two aging mobile home parks going to cost Clark County taxpayers?

The answer likely will come ultimately from the Nevada Supreme Court, as either side is expected to appeal if it loses.

The county already has spent about $15 million to relocate the more than 300 tenants from the mobile home parks. That figure is high in part because the county had to build a new mobile home park near Las Vegas Boulevard, south of the airport, to facilitate the move.

The bigger problem is that there are intertwining laws that apparently require double compensation for businesses closed through eminent domain -- in essence, giving the businesses twice what they would have profited had they not been closed.

One law requires that businesses leasing space be compensated for the value of those leases, while another law requires additional compensation for the fair market value of the businesses themselves.

County officials had opposed the passage of the laws at the Legislature, complaining the two laws compensate for the same thing and the windfall would unfairly burden taxpayers, but the laws still passed.

District Judge Sally Loehrer told the jury Wednesday its job at the trial is to determine the value of the mobile home park businesses, which, she emphasized, "has nothing to do with what the leases were worth."

The leasees had been compensated by the owners for their leases. With the county giving up its eminent domain claims and returning the more than 25 acres as the owners had sought, the business value was left as the only trial issue.

The businesses had been in operation for decades and the two leases, which had 13 and 11 years left on them, brought the owners a reported income of $250,000 a year.

The decision to give back the land that had been the Treasure Lodge and Las Vegas mobile home parks on the north side of McCarran Airport actually may put millions back into public bank accounts.

And it would still allow the county to meet requirements of the Federal Aviation Administration: control development on the parcel that is in the airport's glide path.

The owners had alleged in court documents that Clark County took the land on Tropicana Avenue unnecessarily -- and perhaps fraudulently -- to turn it over to a developer for a hotel and golf course.

"What was once a fairly typical eminent domain case has now effectively become a redevelopment plan that benefits a private party," attorney Terry Coffing said in court documents.

"The county is no longer using its sovereign might for the public good," Coffing said earlier this year. "The county is now using its eminent domain powers to take the property and redevelop it as a 750-room time-share condominium with a convention center and 300-room hotel."

The land in the glide path was going to be converted into a golf course under a deal the county had worked out with longtime Las Vegas developer J.A. Tiberti Co.

Coffing, who represents property owners including former State Republican Party Chairwoman Marilyn Gubler, said the law requires property owners be given the first chance to develop the land in a manner compatible with FAA safety requirements.

With their land back, the owners can make their own development deals.

But they will also have to return $13.7 million that the county has already paid them for the land. If it does not, the county can file liens against the property.

The owners had contended it was worth more and a jury was due to set the actual value at the trial had the county not given up the fight.

Of the $13.7 million, more than $4 million went to leasees. Legal fees and other expenses ate up more of the cash, leaving the owners with about $8 million, according to court documents.

But if the business value is another $4 million and legal expenses -- required to be paid under state law -- are paid, there may not be much left for the county to collect.

The county condemned the land two years ago because of the addition of Runway 19, which resulted in airplanes flying directly over the mobile home parks on the private land.

Coffing said the owners never disagreed with the need to vacate the land.