Tuesday, June 5, 2012 | 9:39 p.m.
The Henderson City Council has agreed to pay $500,000 to settle a suit with a landowner who says the property was undervalued when seized by the city through eminent domain in 2007.
The land in question — owned by the Shearing Family Trust and its company SPS Investments LLC — was an easement located in the right of way along St. Rose Parkway near Executive Airport Drive and Las Vegas Boulevard South.
The city acquired the 4.6 acres of land through eminent domain for a sewer line and maintenance road intended to serve the nearby M Resort and the stalled Inspirada development. The land was valued by the city’s appraisers at $883,400, an amount which was paid by the city to the trust, which represents the estate of the late Steven Shearing, a Las Vegas-based ophthalmologist who pioneered cataract surgery in the 1970s and died in July 2011.
However, Shearing’s appraisers valued the land at close to $7 million, and in September 2009 a suit was filed in Clark County District Court seeking payment for the full value of the land.
Henderson City Attorney Josh Reid characterized the $7 million appraisal as “ridiculous,” but said the city stood to lose a significant amount of money if the court sided with Shearing.
The $500,000 settlement — which was approved unanimously by the council as part of the consent agenda during its Tuesday night meeting — is close to what the city would have had to pay in legal fees to fully litigate the matter, Reid said. As part of the settlement, the M Resort also agreed to pay $1.1 million to the trust.
If the courts had awarded Shearing even $1 more than he was paid in 2007, the city would also have been liable for covering his costs and legal fees, Reid said.
“We had potential multimillion-dollar exposure if we were to take this to trial,” Reid said.
“Next year’s budget has $500,000 wiggle room in the whole budget. A big multimillion-dollar judgment against us could create havoc for the city.”