You may not know it, but everyone in southern Nevada has an ownership stake in a ranching empire located in east-central Nevada. The ranches were purchased years ago by the Southern Nevada Water Authority as part of its plan to go after billions of gallons of rural groundwater.
The water agency spent tens of millions of public dollars to buy the ranches, and even more money to operate them.
Now, a former accountant for SNWA alleges the water agencies have been lying about how much money they spend each month to keep the ranches open.
The long-time employee filed a wrongful termination lawsuit which includes blistering allegations about how water bosses lied to the public and to elected officials. The employee says he has the financial records to prove his story. He gave his first and only interview to the I-Team’s George Knapp.
“They wanted to get rid of me, because of the instance we had in 2012 where we drew a line in the sand,” explains former SNWA comptroller Randall Buie.
The mild-mannered accountant and financial whiz may not seem like a line-in-the-sand kind of guy, but there’s more to this book than its cover. SNWA was the best employer he ever had, he says. He spent 24 years there as an auditor, analyst, then comptroller, which meant he saw every dollar that came in or went out.
He saw the checks SNWA wrote to buy seven ranches in eastern Nevada. The agency paid four to five times what the ranches were worth, $79 million total. It also bought thousands of sheep and cattle, trucks and farm equipment. It hired ranch hands, raised livestock and grew alfalfa.
In 2008, the I-Team asked how much it cost to operate the ranches. Buie says they put a big cardboard box in front of him and told him to start filling it up.
Buie and his attorney Matthew Callister say the I-Team request for public records is what led to his ouster a few years later. SNWA spending on the ranches proved highly sensitive among water agency bosses. The 23,000 acres were to be anchors for a planned $15 billion dollar plan to siphon an ocean of rural groundwater and send it to Las Vegas via pipeline.
Operating the ranches could show SNWA to be a good neighbor, they hoped, but from the beginning, the ranches lost money. Water honchos admitted it at first.
“SNWA did not buy these ranches to operate them as a profit,” then-SNWA Deputy General Manager Dick Wimmer said in 2008.
Mission accomplished. The records showed losses of hundreds of thousands of dollars per year. But, the lawsuit alleges the losses were – and still are – much higher.
“We believe the loss is closer to $2 or $2.1 million a year. That is eight years of $2 million a year and how many years into the future? That needs to be known publicly,” said Callister.
Callister is a former state lawmaker and city councilman. He knows how to read budgets and how they can be manipulated. The lawsuit he filed alleges SNWA has been outright lying, not only to the public, but to its own board.
“There is no other presumption you could make other than believing they had purposely cooked the books to give you false information and, then, obviously, the public false information,” Callister said.
Buie says he was initially ordered to trim any expense that would have existed, even if the ranches were not operational. Even with that fix, the ranches were still bleeding money, so he was instructed to take a meat ax to all expense categories: cut labor cost by 20 percent; parts and fuel by 30 percent; and maintenance by 50 percent. Buie says he never saw any justification for the cuts.
Buie voiced concerns and was assured it was a one-time only thing. But a few months later, Clark County Commissioner Steve Sisolak asked how much was being spent on the ranches, and the accounting team was told to perform the same kind of voodoo.
Buie wrote it up for his bosses, still showing the ranches in the red by the time it was given to the board.
“The loss that we presented to them was about twice as large as what they presented to the board,” he explains.
Buie and his manager told upper management they were done cooking the books. His lawsuit alleges that was the beginning of the end for him. A year later, he was out.
“His refusal to participate, even when he was ordered, knowing it would cost him his employment, his career, his livelihood,” says Callister.
SNWA General Manager John Entsminger says that, because of the litigation, he can’t say much about the allegations. Though, he told the I-Team SNWA provided information as requested, and that SNWA is confident that it can defend its actions in court.