Rhodes could still lose legal war

Developer Jim Rhodes won a legal skirmish that will enable him to push for denser housing than zoning allows on a mesa next to Red Rock Canyon, but he still could lose the war.

The state is challenging a federal judge's decision to strike down a law limiting Rhodes to one house per two acres on a former mining site that overlooks Red Rock Canyon on one side and the Las Vegas Valley on the other.

If the state wins the appeal, the original restrictions will be restored and the people who opposed development near the popular outdoor destination will triumph.

"That would be great," said Heather Fisher, who lives in the tiny hamlet of Blue Diamond near Rhodes' mesa. "I don't see how you can protect an area by ripping the heart out of it."

If revived, the law could override the bargain that Clark County struck with Rhodes in April. It would mean the contentious feud between Rhodes and his opponents, the legal wrangling between attorneys and the hours that county commissioners spent poring over the issue would be almost irrelevant.

Still, the state's appeal will take until next year to run its course, and Rhodes possibly could sidestep it if he can get the commission to approve his project before the court makes a ruling.

The county's agreement lets Rhodes apply for denser housing than zoning allows on his 2,400 acres atop Blue Diamond Hill while giving the county the right to reject any proposal. Rhodes also agreed to drop a lawsuit challenging the county's zoning codes for his land.

Neighbors, conservationists and nature lovers decried the deal as paving the way for hilltop development that would mar the majestic beauty of Red Rock Canyon, whose towering cliffs and rugged trails draw hikers, rock climbers, picnickers and other outdoor enthusiasts from around the country.

They argued that Rhodes should remain limited to one house per two acres on a site visible from Red Rock and surrounding areas. That would cap the density at about 1,200 houses, far fewer than the 5,500 homes he proposed seven years ago.

Rhodes' representatives insist they could shroud a subdivision and a small retail center behind jutting ridgelines. They say Rhodes would need to build more than 1,200 homes to turn a profit, but they haven't indicated how many he has in mind.

Fisher said she was disheartened when commissioners voted 4-3 to approve the deal against the wishes of many constituents. She said she is glad there's another round in the fight, although she wonders whether Rhodes will be stopped.

"We learned that you can't really count on the government to represent the people," Fisher said.

THE LEGAL ISSUES

Fisher and other Rhodes foes would get their way if the 9th U.S. Circuit Court of Appeals rules that the state's land-use restrictions are valid, attorneys say.

"If the 9th Circuit says it's a good law, then it freezes the zoning," said Bryan Stockton, senior deputy attorney general. "Rhodes couldn't change the zoning from what it is."

Stockton said he will submit a written brief to the court by early July on behalf of the attorney general. The court probably will request oral arguments in the next several months and will hear the case sometime in 2011, he said.

Ed Burg, a Los Angeles attorney representing Rhodes, said he was confident his client will win because the federal judge backed up his ruling with case law and solid reasoning.

"The state invaded local zoning," Burg said. "That's to be left with the local jurisdiction."

The legal battle is made more complex by the state and county imposing nearly identical restrictions on Rhodes' land.

Rhodes sued both entities, claiming the laws were unconstitutional because they singled him out unfairly.

Last year, U.S. District Judge Robert Jones ruled against the state law.

Jones said the state had no authority to protect Red Rock because it's not a "common natural resource." His reasoning was that Red Rock, unlike Lake Tahoe, is in one county, making it a local natural resource outside the state's purview, Stockton said.

Jones' ruling was a big reason the county's attorneys recommended settling with Rhodes. The county was about to square off with Rhodes in federal court before Jones.

They worried that if Rhodes won, the judge might lift all the zoning restrictions, including ones that limit housing density and bar Rhodes from building on land abutting Red Rock.

The county's agreement with Rhodes creates 700 acres of buffers next to Red Rock.

Burg contends that the state misused its authority by using Red Rock to crimp Rhodes' property rights. The state is not allowed to impose local zoning on a specific site, even for ecological protection, but must pass laws that apply statewide, he said.

"The problem is it rewrites the Nevada Constitution," Burg said. "So whenever there's an environmental issue, the state can swoop in and make regulations."

Stockton, however, thinks the judge's ruling is off the mark.

Red Rock is more than just a local natural resource, and state lawmakers have the right to safeguard it, he said. It's a national conservation area that attracts 1.5 million visitors a year, many of them from outside the county.

"If you can't protect Red Rock, what can you protect?" Stockton said.

Kevin Powers, attorney with the Legislative Counsel Bureau, agreed.

Red Rock benefits the state as a whole, not just Clark County, he said.

"It's something that's of unique geological and scenic significance," Powers said

You can't claim a national destination is a site that's only of local interest simply because it falls within arbitrary county borders, he said.

Powers contends that the federal judge veered from normal procedure by digging into the state lawsuit before the state courts had a chance to review it.

Rhodes' attorneys filed lawsuits in both state and federal courts, a common litigation tactic, Powers said.

The state lawsuit raised questions about whether Red Rock should be treated as a common natural resource. The federal lawsuit argues that Rhodes was denied equal protection under the U.S. Constitution.

Rather than handle the federal lawsuit first, Jones pounced on the state case.

A federal judge is supposed to resolve federal constitutional issues in a dispute before tackling ones at the state level, Powers said. To do the reverse is "very unusual."

As a result, the appellate court must wade into the Nevada Constitution when these judges' real expertise is federal law, Powers said. For that reason, if the state loses its appeal, the Legislative Counsel Bureau will ask that the case be bumped to the Nevada Supreme Court for a final ruling.

If Rhodes loses this case, he could pursue his federal lawsuit, Powers said, noting that he would be limited to building one house per two acres while that lawsuit plays out.

IT COULD GET COMPLICATED

Evan Blythin, a vocal critic of Rhodes, questioned whether the state winning in court would affect the county's deal with the developer.

Rhodes could push ahead with a project before the appeal is decided and claim it's grandfathered in, said Blythin, a Blue Diamond resident.

Rhodes hired the sharpest lawyers to ensure the government or courts can't block his plans to develop the site, he said.

However, Stockton said the only way a project could be grandfathered in is if county commissioners approve it and the state does nothing to stop it.

The attorney general could ask that the courts not allow Rhodes to develop the land until the case is resolved, an action known as a "stay," Stockton said.

However, the stay couldn't be requested until after Rhodes submits a plan to the county, he said. The state would have to show that the project would cause irreparable harm to Red Rock Canyon.

Terry Murphy, Rhodes' spokeswoman, couldn't say when a site plan might be presented to the public.

Rhodes' planning team has begun studying traffic, soil and utilities, she said. "It's a big project with a lot to do."

Rob Warhola, chief deputy district attorney, said the county's agreement requires Rhodes to submit plans through "major projects," the most rigorous and lengthy review process. That will make it more difficult for him to outpace the state's appeal, Warhola said.

If the state prevails in court, it would strengthen the county's legal position, Warhola said.

The county could impose the state's restrictions on Rhodes' land without fear of lawsuits, he said. That's because the agreement with Rhodes prevents him from suing the county for following the state law if the courts reinstate it.

If the state loses its legal fight to curtail Rhodes' development, he'll have to surmount many other hurdles, Blythin said. Those include piping in water from miles away and building on unstable soil at a former mining site.

And Rhodes will face public opposition every step of the way. "He's got a lot of money riding on this thing. The people have a lot of interest riding on it," Blythin said. "It's kind of a classic battle."

Contact reporter Scott Wyland at swyland@reviewjournal.com or 702-455-4519.