Thursday, June 26, 2003 | 11:01 a.m.
CARSON CITY -- An attorney for Clark County urged the Nevada Supreme Court on Wednesday to overturn a $22.1 million judgment to landowners next to McCarran International Airport who say they can't build a major hotel-casino because of air space restrictions.
Kirk Lenhard, the lawyer for Clark County, said there has not been a "physical taking" of the airspace and there was no evidence that planes landing or taking off have used the area.
But Michael Berger, representing the property owners, said the county imposed a "transitional zone" over the property that could be used if an emergency occurred involving planes landing or taking off.
This is a "physical taking" and the property owners should be compensated, he said. The property is in the "backyard of the MGM hotel-casino," Berger said. The owners had an expectation of building a major hotel-casino there.
The court took the arguments under study. But some justices express skepticism about the District Court decision that resulted in $12.6 million, $7.9 million in interest and $1.3 million in legal fees.
Randy Walker, Clark County's director of aviation, has said the judgement was alarming enough to notify airlines of a potential impact on fees at McCarran. That prompted Southwest Airlines to issue a letter stating that if fees are raised dramatically to pay court-awarded damages, "service disruptions" could result at McCarran.
The land owners and their attorneys, though, have said the airport and Southwest were engaging in scare tactics to sway public opinion and the Supreme Court. Because their land was acquired before Clark County imposed height restrictions, they say the land has been devalued and that they are entitled to compensation.
Justice Nancy Becker said the property owners could have asked for a variance to the height restriction. She said the owners knew there were height restrictions on the land.
Senior Justice Cliff Young who sat in for Justice Miriam Shearing, asked, "Why didn't they go to the county and ask for a variance? He said "County commissions do strange things."
Berger said there was testimony at the trial from former Airport Director Bob Broadbent that the airport would always oppose any variance to height restrictions. He said there were limits on part of the property and they were extended over the full property when a new airport runway was expanded. Berger said the property owners didn't want to approach the county until they "put something in the ground."
He said there was evidence at the trial that the property owned had an expectation that they could put up a major development. That's why they received $12.6 million.
The owners of the property are Tien Fu Hsu, Lisa Su Family Trust, Peter Kiao, Westpark Inc., Lucky Land Co. and other associated companies. The owners operated a trailer park, lounge and billboards.
The jury awarded $13 million but District Judge Mark Gibbons, now a member of the Supreme Court, reduced that to $12.6 million.
Lenhard said this "is not a case where Clark County is acquiring air space. Clark County has not authorized the occupancy of airspace or land." He said the owners never applied for a variance. And they never drew up any solid plans for a development.
The case started with a widening of Tropicana Boulevard in which some of the property was taken. The owners then sought compensation for the air space.
Other justices disqualified besides Gibbons and Shearing were Myron Leavitt and Bob Rose. District Judge Jerry Polaha of Reno replaced Rose and the five-member court heard the case.
This case is being watched by property rights advocates and local governments to determine if compensation must be given to those living near airports under certain circumstances.
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