Two ex-Nevada officials facing water bribery charges

LAS VEGAS (AP) - A retired Nevada state water regulator and a former local utility official have been arrested and accused of receiving $1.3 million to help a wealthy rural landowner transfer water rights to the water authority serving the Las Vegas area.

Robert Coache and Michael Johnson are due Thursday in Las Vegas Justice Court on 25 felony and misdemeanor charges alleging they took money to help John Lonetti Jr. of Bunkerville sell $8.4 million in Virgin River water rights to the Southern Nevada Water Authority, according to court documents and jail records.

The Las Vegas Review-Journal reported that Coache, 52, retired in May 2010 as a deputy state water resources engineer and Johnson, 51, resigned in August as chief Virgin Valley Water District hydrologist. Both men live in Las Vegas.

Coache made an initial appearance in court Wednesday. Justice of the Peace William Jansen ordered him to appear again Thursday with Johnson, and said he would consider setting bail at that time.

Both men are accused of conspiracy, bribery, extortion, money laundering and official misconduct charges that could get them decades in prison.

Clark County District Attorney David Roger told the Review-Journal the case was the first corruption prosecution involving water rights that his office had handled.

In a statement issued Tuesday, the state Division of Water Resources and the state engineer's office said they were cooperating fully with police investigators.

The Virgin Valley Water District supplies about 23,000 residents, ranchers and farmers at the northeastern corner of Clark County, including the communities of Mesquite and Bunkerville, 85 miles northeast of Las Vegas.

The charges allege Coache and Johnson used an entity called the Rio Virgin partnership and other companies to buy homes with cash they got from Lonetti.

Both Lonetti, 77, and the water former water district general manager, Michael Winters, 56, are named in court documents but have not been charged with a crime.

However, a Clark County grand jury indicted Winters last June on unrelated misconduct charges stemming from allegations that the water district paid an inflated price to buy land for an arsenic treatment plant. His trial is set for May 23 in Clark County District Court.

Police allege Winters received $15,000 from Johnson to use his influence to get the district board to approve Lonetti's $8.4 million deal. The agreement was struck at a time when the Southern Nevada Water Authority wanted to acquire water rights throughout the eastern part of the state.

The authority made a push for Virgin River water rights after a December 2007 agreement among Colorado River water users gave water managers in Las Vegas permission to take water from the river after it flows into Lake Mead. That eliminated the need to build an expensive pipeline to reach it.

Authority spokesman Scott Huntley told the Review-Journal that SNWA officials are cooperating with the investigation and had no knowledge of any misconduct.

"From our standpoint, it was a normal transaction," Huntley said. "We were looking to buy water rights on the Virgin, and we got what we thought was a fair price."