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September 2, 2014

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Electricity will flow to Coyote Springs, but there are still no homes to power

Image

Courtesy of Coyote Springs

Coyote Springs Golf Course is the only completed element of the 43,000-acre Coyote Springs project.

Coyote Springs

Coyote Springs is a planned city in Lincoln and Clark counties near the junction of U.S. Highway 93 and State Highway 168, about 50 miles north of Las Vegas. Launch slideshow »

There are no homes yet at the 43,000-acre Coyote Springs development 50 miles north of Las Vegas, but starting today, the troubled multibillion-dollar project will at least have power.

Local officials will gather there this morning to flip the switch on a new electrical substation. It will mark the first sign of progress in several years for the stalled project, which has been delayed by the recession and legal issues.

The substation will provide electricity to the Coyote Springs Golf Course, which has been powered by diesel generators and is the only existing feature at the development. It also will power future homes — if they ever get built.

Sam Singer, a spokesman for developer Wingfield Nevada Holding Group, said powering up the substation is a sign that the project is “back on track.” Bringing electricity to the development will allow for the completion of water and sewage treatment plants, which are needed to bring homes and residents to the area, he said.

The vision for Coyote Springs was hatched more than a decade ago when the valley’s real estate market was booming. Initially led by powerful lobbyist and developer Harvey Whittemore, the project called for a master-planned community of 159,000 homes, as well as retail, schools, emergency services and more than a dozen golf courses. The development was planned for 67 square miles — nearly twice the size of Summerlin — in a scenic desert area nestled among three mountain ranges on the border of Clark and Lincoln counties one hour north of Las Vegas.

Whittemore helped guide the project through several hurdles, including getting permits from federal agencies that held interests in the land. Then, the housing market crash stalled the project indefinitely.

Whittemore resigned from Wingfield Nevada Holding Group and sold his interest in 2010. In January, the company filed suit against him, alleging he embezzled tens of millions of dollars from the project.

Click to enlarge photo

A photo of Coyote Springs Golf Course, the only completed element of the 43,000 acre Coyote Springs project, which the developer says will one day include 159,000 homes. Local officials will flip the switch on a new electrical substation at Coyote Springs, located 50 miles north of Las Vegas, on Wednesday, Aug. 22, 2012, which will enable further development of the project.

That case will be tried in Clark County District Court in May. Whittemore also faces unrelated federal charges accusing him of campaign law violations and lying to investigators. He has pleaded not guilty.

With Whittemore gone, his partners in the project, brothers Thomas Seeno and Albert Seeno Jr., have taken full ownership of Coyote Springs, which also is embroiled in litigation with Pardee Homes. Wingfield Nevada Holding Group alleges that Pardee Homes reneged on an agreement to complete infrastructure improvements to prepare the site for the construction of homes.

Further development can’t occur until the legal issues are ironed out, but Singer said Wingfield Nevada Holding Group is confident it will reach a resolution with Pardee Homes.

But even if the court cases are resolved, Coyote Springs still faces the challenge of selling the project. Singer said it will still be years before homes are built at Coyote Springs, and the community will take decades to grow to full capacity.

Still, Singer is hopeful that will happen.

Coyote Springs "is very strongly positioned," he said. "The economy is starting to move in the right direction again. In that sense, it’s the perfect time to be at this stage in development to catch the next wave of homebuyers.”

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  1. Coyote Springs won't simply take decades to come to fruition, because it will never happen. There is still a fairly decent amount of land in the Las Vegas Valley that is able to be developed, not to mention that there are the competing outlying communities of Mesquite with it's own bottom of the barrel prices on real estate as well as an established retirement community, not to mention Logandale, and of course Pahrump. Nevermind the real-estate crash, this place was thought of back when gasoline was only about $1.25 or so a gallon.

    If anyone wants a good history lesson here, look up "California City". It too was a master planned community of this scale that was created in the desert back in 1958. 50+ years later, and despite decades of increasing real estate prices in California, and countless "...wave(s) of homebuyers.", the place has never gotten off of the ground. Like Coyote Springs, no one wants to live that far out in the middle of no where. At it's peak California City held 14K residents in the 1980's, and today is only above 9K. And that is with nearby employers such as a prison and Hyundai. Coyote Springs offers no employment opportunities for anyone.

    The lawsuits against Harvey Whittemore are as naive as the investors filing them because they were foolish enough to invest in this project. The legal actions IMO are nothing more than tantrums by people who were not smart enough to have NOT invested.

  2. Why is it the golf courses ALWAYS go in first? Is no one learning a lesson starting back from 2008 or are all of them so freak'n dumb !! The BOOM is over. Nevada will now enjoy "normal growth" with normal expectations.

  3. What a waste. Destroying wildlife habitat, wasting billions of gallons of precious water on empty golf courses, more dollars chasing bad investments. This was supposed to be the Water Authority's Jewel in the Crown. Instead, it's a disaster. And you bet your last tax dollar that the ratepayers and taxpayers of Clark County will once again end up picking up the tab for this hubris.

  4. Mr. Rake,

    Can you please explain what the Water Authority has to do with this project? I can find no information at all stating they are part of it in any way.

    Most of this project is in Lincoln County with a small part in Clark County.

    Good dollars after bad, could be but it is all private money at this point. None of your money has been used for any part of what they have completed.

  5. This project was vigorously promoted by SNWA and was originally funded by the "purchase" of Coyote Springs water rights from Whittemore by the agency. Further, the SNWA's controversial pipeline project was (still is) to be the delivery mechanism for the water rights Whittemore had (has?) in far northern Lincoln County to Coyote Springs. Without SNWA, this project would not have gotten past the dreamin' and schemin' stage. SNWA Maximum Boss Pat Mulroy boasted in a Sun editorial board meeting in the early 2000s that Coyote Springs was completely dependent on the pipeline and that the project would be a wonderful thing for Southern Nevada. Further, Whittemore's lawyers virtually camped out at SNWA offices for years as they worked to bring their mutually enriching (for themselves, not tax and ratepayers) project to fruition. At every public hearing of the pipeline, some of the loudest voices for the pipeline project have been the developers for Coyote Springs. I believe that if you look at the totality of the record, you will find that one of the major reasons for the pipeline, if not the single largest reason, was the need to transport water to Coyote Springs. There simply isn't enough water in the valley (especially considering the putative sale of water to SNWA which, again, funded the project's inception) to sustain the project. Keep in mind, of course, that the pipeline cost is now estimated to be about $16 billion. Who is going to pay for that?

  6. And the cost has certainly not been paid only by the developers, if only looking at the water issue. Las Vegas ratepayers ponied up $25 million to cover Whittemore's initial investment, with the ephemeral purchase of those high-priced Coyote Springs rights, but it is true that most of the major development costs have by agreement been covered by the developer. Unfortunately, there is a long history of such agreements going south and being renegotiated when developers run out of money. Remember, these are some of the same guys that brought us the Las Vegas Monorail.

  7. Here's a quote from a great I-Team story on the SNWA/Coyote Springs "public-private partnership":

    When water authority boss Pat Mulroy says she had little to do with the plans for a boomtown in Coyote Springs, she's being a bit too modest. Without her help -- and that of many other public officials -- Harvey Whittemore's grandiose vision could never have moved forward.

    Whittemore is widely regarded as the most effective lobbyists in Nevada history, a man who gets what he wants. Coyote Springs could be exhibit A. In 1996, Whittemore's company bought 42,000 acres in Coyote Springs. His vision was to build up to 150,000 homes, along with 10 golf courses and a casino or two, even though the valley is 60 miles from Las Vegas and is home to endangered species and sensitive lands and has scarce water resources.

    "There was a vision that a large piece of public, I mean private property, would make a phenomenal development," Mike Hillerby, Coyote Springs Development. The slip of the tongue by Coyote Springs executive Mike Hillerby is understandable since the land in question once belonged to the public.

    In the 1980's, the BLM land was designated as a potential site for the MX Missile project. When that was cancelled, a rocket company named Aerojet acquired the acreage in a swap for Florida swampland. Documents show Aerojet was specifically not to use the land for development beyond what was needed to test rockets. Somehow, that stipulation vanished by the time Whittemore bought the property. But where did the idea originate?

    "I can't comment on the genesis. I don't know the genesis," Hillerby said.

    The idea may have come from Richard Bunker, former Clark County manager, longtime partner with Whittemore and fellow gaming lobbyist. Bunker reportedly went to Clark County as an agent for Aerojet to propose the county acquire the land. When the county said no, Whittemore entered the picture. He bought 42,000 acres for $23 million dollars but quickly sold part of his water rights to the SNWA, headed by Pat Mulroy for $25 million. When Richard Bunker was Clark County manager, Mulroy was his assistant. She regards him as her mentor. She defends the Whittemore deal as good for both parties, though it meant Whittemore essentially got the land for free, plus $2 million.

    SNWA has helped in other ways too. After federal agencies said water pumping the Coyote Springs would likely dry up nearby warms springs and kill endangered fish, SNWA bought the springs for $69 million and agreed to watch over the fish. SNWA's proposed water pipeline to rural Nevada will come in handy as well since it means Whittemore can buy up remote ranches for their water, then use the public pipeline to carry the water to his development.