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2 ex-water officials to be arraigned Thursday in $1.3 million bribery case

Defense attorney: State expected to seek indictments from grand jury

Updated Wednesday, May 11, 2011 | 12:09 p.m.

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Robert Coache

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Michael Johnson

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Two former water officials accused in an alleged $1.3 million bribery scheme involving the sale of Nevada water rights will be arraigned Thursday in Las Vegas Justice Court.

One of the officials, Robert Alan Coache, 52, former deputy state engineer for Southern Nevada in the Nevada Division of Water Resources, appeared briefly this morning before Justice of the Peace William Jansen.

Jansen started to arraign Coache, then decided to continue the arraignment until Thursday so both Coache and his co-defendant, Michael E. Johnson, 51, former chief hydrologist of the Virgin Valley Water District, could be arraigned at the same time.

Both men are in the Clark County Detention Center on $500,000 bail. The charges against each of them include bribery, misconduct by a public official, conspiracy and money laundering.

The complaint says they were paid more than $1.3 million in bribes to help Bunkerville landowner John Lonetti Jr. sell two Virgin River water permits to the Southern Nevada Water Authority for about $8.4 million.

The complaint alleges the activity took place between Jan. 1, 2006, and Sept. 13, 2010. It says the two men set up a company, Rio Virgin LLC, to accept the $1.3 million from Lonetti and then paid themselves from that company.

The complaint lists 18 counts of money laundering and says the money paid by Lonetti to acquire the water rights was withdrawn from Rio Virgin LLC by Coache and Johnson.

Coache's attorney, Bret O. Whipple, said it didn't matter to him when the judge set the date for a preliminary hearing, because it was his understanding that the district attorney's office would bypass that process by taking the matter to a grand jury.

"I think what this is all going to boil down to is there is only a handful of hydrologists in this state and they're all friends," Whipple said. "We'll address the issues on the merits later on."

Whipple did ask the judge to lower the bail for Coache, saying Coache has lived in Las Vegas all of his life, has family here and worked 29 years as a state engineer, rising to be the second or third in command at his office.

Whipple made a request for releasing him on his own recognizance, but said the judge at least should consider lowering the bail — a $500,000 bail is something that is usually seen in cases involving murder, he said

"So $500,000 is just a little unrealistic," Whipple said. "This is a man who couldn't have more ties to the community."

Jansen said he would take up the matter Thursday during the arraignment for both Coache and Johnson, whose attorney will be Blaine Beckstead.

Chief Deputy District Attorney Marc DiGiacomo told the judge he would argue against reducing the bail.

"It was approximately $1.3 million that they stole — that's the reason for the high bail," DiGiacomo said.

According to a police investigator's report, the two men worked with another man, Michael Winter, the former general manager of Valley View Water District, to sell Lonetti's water permits. Neither Winter nor Lonetti have been charged in the case.

CORRECTION: Clarification: In an earlier version of this story, John Lonetti's first name was incorrectly written as Michael Lonetti. "Michael Lonetti" is how Lonetti's name is listed in the criminal complaint. | (May 12, 2011)

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