Tuesday, February 25, 2003
Copyright © Las Vegas Review-Journal

Wynn seeks exemption for utility

Steve Wynn, developer of Le Reve, wants the state Legislature to exempt from state regulation the water utility that serves the project and nearby residents.

But three of the 10 homeowners who rely on Wynn's water utility objected Monday during an Assembly Commerce and Labor Committee.

In order to redevelop the former Desert Inn casino, Wynn purchased most of the about 50 neighboring houses. But 10 homeowners continue to live in the Desert Inn Country Club Estates adjacent to Le Reve, formerly the site of the Desert Inn. They get water from the Desert Inn Improvement Co., which Wynn controls.

The Strip casino developer wants the Legislature to exempt the private utility from regulation, because he must obtain Public Utilities Commission approval for financing his new development project and that adds delays and costs, said Fred Schmidt, an attorney for Wynn.

Nevada has hundreds of small water companies that are unregulated, said Schmidt, former state consumer advocate.

Schmidt said the water company agrees that it is bound by a contract that requires it to serve the homeowners. He was supported by Tim Hay, present consumer advocate. The Public Utilities Commission doesn't object, according to Dave Noble, an attorney with the PUC.

The homeowners, however, said they want to retain the option to seek a regulatory remedy, rather than going to the expense of filing a lawsuit.

"We have some real safety issues, because we have real problems with water interruptions as it is now," said Sharon Greenbaum, one of the remaining homeowners.

They are involved in lawsuits with Wynn's companies over governance; covenants, conditions and restrictions; and alleged restrictions on use of the golf course land.