Court upholds Henderson’s denial of resort

Monday, Feb. 11, 2002 | 10:58 a.m.

CARSON CITY -- The Nevada Supreme Court has upheld the decision of Henderson to deny a permit to build a hotel-casino called the Sunset Beach Resort. But the court allowed the owners another chance to prove they are entitled to damages from the city.

The court last week said there was substantial evidence for the City Council to reject the application of the resort, owned by Pegasus-Sunset LLC.

The court said records show the project would be incompatible with the industrial businesses in the surrounding area and residents and a business owner expressed opposition.

The court also rejected Pegasus' argument that the city denied the application due to political pressure from Station Casinos Inc., which owns the Sunset Station hotel-casino in the adjacent area. The court said there was no record of any evidence Station Casinos lobbied the city behind the scenes.

The ruling upheld the decision of District Judge Sally Loehrer.

However, justices said Loehrer was wrong in granting a pre-trial summary judgment for the city on the claim by Pegasus that it lost the use of its property without just compensation. The court said Loehrer should reconsider this part of the case.

The court said, "Regardless of whether the city acted lawfully in denying Pegasus' applications, Pegasus may still have a claim for a taking of property without just compensation if it can show that the property has been adversely affected by the city's zoning regulations."

The City Council in September 1998 voted 4-1 against the proposed hotel-casino because it did not meet new minimum acreage requirements. It was to be built on nine acres at the corner of Sunset and Middlegate roads. In July that year the city set the new minimum standards for resort developments at 25 acres.