Bids dribble in at water auction

Monday, May 1, 2000 | 11:43 a.m.

An auction of ground-water rights sold for less than expected Saturday, auctioneers said today.

The sale suffered from pre-auction announcements from the State Engineers Office that a portion of the water rights on the block might be forfeited to the state, said Guy Deiro, a company owner with auctioneers Robert Deiro and Associates.

The auction put 613 acre-feet of water for sale, but sold only 122 acre-feet. The owners of the water rights were the Las Vegas Country Club, with about 238 acre-feet on the block, and Gordon Gaming, owners of the land that was home to the old El Rancho Vegas resort at Sahara Avenue and Las Vegas Boulevard, with the remainder, Deiro said before the sale.

An acre-foot of water is equal to 325,851 gallons -- or just about the water needed for a family of four for one year.

The water rights could be an attractive option for households in rural areas that might have to pay thousands of dollars to connect to municipal water systems.

Deiro said both the Gordon Gaming and Las Vegas Country Club water rights were hurt by the pre-auction statements by the engineer's office. The Las Vegas Country Club sold 22 acre-feet, and Gordon Gaming sold 100 acre-feet. Bidders paid about $10,000 per acre-foot of water.

The company is still receiving calls from potential buyers and could schedule another auction, Deiro said.

Without the public statements from the engineer's office, "We could have sold a lot of water," Deiro said.

The sale was the biggest in recent memory and the only one in memory to offer water rights in smaller amounts -- from one to 10 acre-feet.

Hugh Ricci, deputy state engineer, said the engineer's office has questioned the validity of water rights for the country club. The club's golf course historically had the water rights, but the engineer's office argues that the water hasn't been used in years.

By law, water rights that aren't used for five years or more revert back to the state. The country club -- or potentially a new owner -- could challenge the engineer's office on the issue. That office must approve any new wells drilled with the water rights or transfer of the rights to a different part of the Las Vegas Valley.

Ricci said his office hasn't yet received any formal response from the country club.

"That's going to be brought up when and if the country club takes issue with what we said," Ricci said. "Not all that water was used over the last 10 years."

Representatives of the Las Vegas Country Club weren't immediately available for comment.

Launce Rake covers growth issues for the Sun. He can be reached at (702) 259-4127 or by e-mail at lrake@lasvegassun.com.