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Questionable management, Questionable land deals, Questionable affiliations ...
Who is clark county aviation director randy walker?
Liberty Watch has a pretty good idea.
By Mike Zigler
Land deals affecting the airport have frequently been contentious for residents and developers. Once upon a time, McCarran International Airport officials could lease, sell or trade the land in the 5,300 acres - called the Cooperative Management Area (CMA) - under flight paths in and out of the airport.
The federal government gave the land to the airport to minimize development (primarily residential) incompatible with aircraft noise and the potential expansion of McCarran. CMA includes restrictions on new residential development to reduce noise-related complaints, although there are inholdings of existing homes scattered through the area. Plus the county had already master planned much of the area residential.
With the master plans calling for something that restrictions in the CMA discouraged, that created mouth-watering opportunities for smart developers - and Clark County Aviation Director Randy Walker.
Walker has his fingerprints all over several controversial land deals, many with strange connections to fellow Latter-day Saints. Each suggests he's used his high-profile position in Las Vegas' most essential industry - aviation - to scratch backs and hand deliver sweetheart deals.
McCarran has dabbled in land acquisition for decades, but real estate dealings expanded in 1998. That's when the Southern Nevada Public Lands Management Act gave McCarran management responsibility of the 5,300 acres around the airport.
The airport launched the land exchange program to limit residential construction beneath noisy flight paths. McCarran officials placed deed restrictions on the former federal land and began offering to trade it for privately held parcels.
In July 2004, the county commission approved an overhaul of rules governing sales, swaps and leases of airport land. The new policy requires public hearings and a detailed request for a proposal before land deals are approved. But it was merely a gesture to solve potential problems with land swapping, as most hearings are full of fluffy PowerPoints and charts that barely scratch an informative surface. The policy was also about two years too late for the most notable and controversial deal.
Walker oversaw a land swap that went under federal investigation. The investigation stems from a January 2005 Las Vegas Review-Journal story revealing a 2003 county land deal near Windmill Lane and Durango Drive. For $2.5 million, the airport sold 37.5 acres to Scott Gragson, a private broker and grandson of former Las Vegas Mayor Oran Gragson. The sale was with the understanding that the land would be used for a cemetery - which the acreage was zoned for.
The county advertised the land for public auction with a cemetery restriction that limited its value (and interested buyers). But in January 2005, soon after the sale, half the land was rezoned for commercial development in January 2005, earning Gragson - the only bidder for the land - $5 million once he sold the land to a developer with intentions to build a grocery store.
County commissioners insisted that the 38-acre parcel be zoned residential in the master plan, but that conflicted with the management area restrictions. Without a commercial designation, and without the ability to build homes by any future owner, the county said one of the few uses would be for a cemetery.
The master plan was unrealistic, and wise developers could've recognized that they could change it to a more realistic one. Gragson was that developer.
After the sale to Gragson, the cemetery restriction vanished and the value of the land increased. Airport officials deemed the omission a clerical error.
Walker contended the problem stemmed from the failure to apply a deed restriction to the land requiring its use as a cemetery.
But what's interesting is that Gragson was a regular purchaser and trader with the airport. He had 20 land exchanges with the airport. According to a Review-Journal investigation, Gragson used the same appraiser for all 20 - Tim Morse. Gragson was able to flip at least 10 parcels for a profit less than a week after acquiring them from the airport.
Walker contended that appraisals were low because of the way the land is master planned - residential. County appraisers cannot speculate what the ultimate use will be. So if the land is slated residential, then the appraiser has to assume that residential development will be the final product despite the fact that such development within the CMA ranges from limited to prohibited. This also gave Walker free reign to tango with juicy deals.
A problem with a master plan is that it can easily be molded with the right tools - usually political ones. Land buyers can get cheap property from the county then change those designations before selling for a significant profit - or develop it in a way that the county's appraisers didn't anticipate. Raw land appraisals rarely reflect what the land will ultimately be used for, and therefore are not a reflection of the market value. If the land was sold from private hands, not public ones, this would not happen.
Attorney Laura FitzSimmons is a longtime critic of Clark County's land transactions. In 2002, she asked federal officials to probe the same issues that came to light earlier this year - that the county aviation department shortchanged local taxpayers through land sales, which benefit a small group of land developers.
Specifically, she identified a deal that involved former Clark County Commissioner Jay Bingham and Cam Walker, son-in-law of the late monorail executive and former Clark County Aviation Director Bob Broadbent. County Commissioners approved a land lease with one group of developers over another's $1.5 million cash offer - which happened to be 20 percent more than the appraised value of the land. Walker deemed the deal better in the long-term, but according to the Las Vegas Sun, FitzSimmons called it part of a "a persistent pattern of exchanging CMA land to political insiders for values which shortchange the intended recipients of CMA funds, primarily the Bureau of Land Management."
Walker has little incentive to sell the land for a high price. After all, the BLM gets 85 percent of the land sale funds, while the county collects 15 percent. So why not help out buddies who happen to be local land developers? (Walkers' department earns 50 percent from land leases after the sale.)
FitzSimmons has consistently argued that the aviation department regularly uses a small group of appraisers who alter appraisals, an activity that shortchanges landowners who sell to local governments.
Walker told the Sun, "The primary purpose of the CMA land is to assure that land is developed in accord with the nature of the airport. We have a $4 (billion) to $5 billion asset here, which is the lifeblood of the community. We want to make sure we don't have the same problems that other airports have."
The airport has legal protection against noise-related complaints - the premise behind CMA land - but Walker believes complaints can still impact airport operations.
FitzSimmons, on the other hand, believes it all boils down to one group scratching another's back. In four years, she's received numerous calls from developers who felt airport officials were "feathering their own nest."
"Certain people have the inside scoop and the inside advantage," she told the Las Vegas media.
Walker said that the goal with land deals was never to make money for the federal taxpayers, and denied there was any form of insider clique benefiting from lucrative land deals and business.
But consider this. When the proposal request for the Terminal 3 construction project went out, several architects and local firms were surprised to see the name Pierce Goodwin Alexander & Linville (PGAL) on the short list late last year. The company did not have a major airport architectural firm backing it.
The company is a Texas-based firm that has a local branch office. It's been suggested that PGAL dumped a partner, Lucchesi Galati, to acquire Welles-Pugsley Associates. Why? Welles-Pugsley was a "lock" on the Terminal 3 project. To be part of that "lock," PGAL is rumored to have hired of a popular consultant named Sig Rogich.
Rogich assisted in connecting PGAL with Welles-Pugsley, who has a principal with the same religious affiliation as Walker. Furthermore, the local engineering firm on the team is tied to this religious group. That means both architectural and engineering firms on the Terminal 3 job are religiously linked to Walker.
Interesting religious coincidences extend to another controversial deal. The Clark County Aviation Department traded three pieces of prime land with Mormon Howard Bulloch in November 2003 - one being off Las Vegas Boulevard located in the middle of future high-rise condominiums.
Located on the land is Cactus Ridge, a 193-unit mobile home park. Residents of the park were moved there years earlier after the aviation department took over their other park on Tropicana Avenue. That one was under a flight path.
Residents didn't mind the move at the time, but following the trade with Bulloch, the aviation department no longer controlled the property and rent skyrocketed. Residents, most of whom are on fixed budgets, see it as an effort to force them out for future development.
This left them feeling alienated by the government, who stripped them of their homes on Tropicana, moved them to Cactus Ridge off Las Vegas Boulevard, and then traded the land.
On the other end of the deal, the airport acquired land near I-15 and I-215 for a proposed car rental facility.
The land swap, approved by the Clark County Commission, affected the value of a neighboring land owner, who happened to be university regent Steve Sisolak. The aviation department acquired 19 acres a quarter-mile southeast of the I-15 and I-215 intersection. Bulloch and his partner received three pieces of airport-owned land in the exchange, one being Cactus Ridge.
Sisolak's attorney called it a "sweetheart" deal that benefitted Bulloch at the expense of the taxpayers. Sisolak had already sued for $6.5 million over airport height restrictions, which negatively affected the value of his property. He won, but airport officials are challenging the decision.
Walker said that paying off all land owners who lost value in their land because of the height restrictions could cost more than a billion dollars and make air travel to and from Las Vegas more expensive. The goal, Walker told the media, wasn't to squeeze Sisolak or provide a juicy deal to Bulloch. Rather, the intention was to control the land so owners don't build into the airspace or sue the airport when they cannot.
During the 1990s, officials of the Clark County Department of Aviation and a private firm looked into the possibility of building a second airport. The new airport would free up air space at McCarran for planes carrying more tourists than cargo. The argument: rapid growth of air traffic would force the need for a second airport by 2013.
While McCarran can build more terminals to handle more passengers - like it is doing with Terminal 3, expected to open in 2010 - McCarran doesn't have room to build more runways.
So Walker advocated for a new airport in the Ivanpah Valley, a dry lake bed between Jean and Primm. Other areas around Las Vegas were off-limits. The Department of Defense controls air space to the north and Boulder City wouldn't agree to release land between its town and Laughlin. Other areas host mountainous terrain. Once the ball got rolling for Ivanpah, Walker killed the relationship with the private firm that performed all the dirty work and research to solidify the location.
The Ivanpah airport could open as early as 2013 at a cost of $1 billion to $2 billion. It would also require a build-out capacity of McCarran's current visitor volume.
But looking at the controversy surrounding land deals involving Walker and McCarran, County Commissioner Lynette Boggs-McDonald expressed concern that similar controversies could be the case with the new airport 40 miles south of Vegas. The management area down south is 17,000 acres versus McCarran's 5,300 acres.
So the county created somewhat of a solution. In April, commissioners stripped the aviation department of its authority to manage public lands. The unanimous decision also mandated that county land be auctioned only through public auction in the future. This banned airport land trades that might have enriched private entities (like ones linked to high-ranking airport officials) at the public's expense.
But who knows what could come of this by 2013. Eight years is a considerable amount of time to construct new strategies and develop new relationships to work around government gestures, masked as solutions - especially when a smart character like Randy Walker is involved. LW
The state used its bonding capacity to back the monorail bonds, which could affect Nevada's bond rating. But that's not even the extent of the monorail mess. State and county governments exempted the monorail from paying taxes.
At the county level, millions in property taxes on prime land were pulled from the tax rolls. Millions of dollars of buildings and improvements were also given a free pass, and according to the county assessor, that costs the public at least $3 million a year.
At the state level, the monorail - not being taxed at all - escaped paying millions in sales and use taxes. Why? Well, the state declared the monorail a charity - one that charges tourists for trips to Strip casinos.
No one knows more about the Las Vegas Monorail mess than Las Vegas' popular investigative reporter George Knapp. Back when the Las Vegas Mercury was still alive, Knapp broke down the strange relationships involved in making the casino-to-casino rail line a tax-free reality. Of course, Randy Walker has a link.
The monorail project was started by the late, well-connected former county commissioner Bob Broadbent, who also served as Clark County Aviation Director, the position Walker currently holds. Broadbent brought in his son-in-law, Cam Walker (unrelated to Randy), into the monorail project as Chief Operating Officer. Cam hired his brother, Todd Walker. While Randy is unrelated to both Walkers, he is coincidentally related to monorail CEO and mayor of Henderson, Jim Gibson - an active member of the Mormon church along with County Commissioners Bruce Woodbury and Rory Reid.
The family relationships, longtime business relationships, religious ties and political connections not only border on polygamous, they made this train wreck of a project a tax-free reality.
The Russell & Burnham Project
On the corner of Russell Road and and Eastern Avenue, the Clark County Aviation Department and a private developer have started construction on airport-related support buildings and retail centers. Airport officials bought the last home in 1999 on a "willing buyer-willing seller" basis. But some residents who lived in the small, 277-home neighborhood said they were misled.
There were questions of whether or not the airport should serve as the vehicle for this investment. Former owners of homes in the area were upset because they were told by airport officials that the land would be utilized for airport uses, not shopping center development. Expanding the airport to better serve the public, former residents said, is a public service - not leasing the land to new businesses.
Walker, though, argued the project serves a public need. His department isn't in the business of commercial real estate, and does not buy land for speculative purposes. The airport, however, must release land to businesses for a couple reasons, Walker has said.
First, if they don't deal with potential business developers, the department feels that someday another developer would build homes in the area that the Clark County Commission fought to rid residentially. Second, commercial business along the perimeter would provide a better buffer for airport activity from the roadways than homes in a residential area.
With the "Russell-Burnham" project, the aviation department continues to own the land and receives 50 percent of the lease revenue. This led some developers and politicians to share reservations about similar efforts by the aviation department. The concern has been that the aviation department's public ownership of the land could allow the contracted developer to undercut private owners nearby, giving the government an unfair advantage and wounding private investors.
County commissioners and other politicians expressed concern that the terms of any lease on the airport's behalf should be as close to fair-market value as it would be for a private party transaction.
A Downtown Debacle
In February, a Las Vegas Review-Journal investigation revealed that Walker was tied to a controversial deal that saw the city of Las Vegas acquire land downtown for $7 million. The land was later transferred to Boyd Gaming for a single dollar because Boyd spent $2 million on city projects.
Walker was involved in the city's court battle in 1990 to acquire 3.4 acres of Union Pacific Railroad for $7 million, according to a 552-page court document examined by Nevada's largest newspaper.
Walker, who at the time was acting city manager and chief of the city's redevelopment agency, submitted an affidavit stating the city's need to acquire the 3.4-acre parcel for the public good. It was an eminent domain case that a judge awarded to the city. The city handed the land over to Boyd Gaming in 1994 for $1, requiring the company to build a parking garage or a sports arena. Neither happened.
Walker, who wasn't the city manager during the 1994 trade-off with Boyd, publicly claimed he had little memory of the deal.