News Impact Project: Nevada Reporter Uncovers Potential Corruption by Quasi-Government Business

While impactful news can be many things, we often think of it as being investigative in nature and shining a light into a dark corner that others want kept hidden. For The Nevada Independent, that dark corner involved a questionably run water district, and the flashlight belonged to reporter Daniel Rothberg.

When Rothberg began reporting on the Tahoe-Reno Industrial Center (TRIC) General Improvement District’s (GID) water district, he wasn’t expecting to find anything peculiar. He was simply following up on an “eminent domain” story in which companies housed in the industrial park attempted to get a right-of-way for a pipeline that would bring them more water via treated effluent and wastewater.

One of the landowners who had been approached to have the pipeline built on his land filed a challenge to the eminent domain request, and in doing so it became clear that there was no information about the GID in question. What Rothberg found was a unique-to-Nevada situation: In Nevada, general improvement districts are semi-public organizations or utility managers that help provide essential services – such as water, sanitation, streetlights, sidewalks, etc. – for the businesses and residents of that area. The situation at TRIC raised questions about whether governmental powers such as eminent domain were being wielded by a private entity.  Rothberg soon discovered the TRIC’s management and board were comprised of some unexpected members. “It did not cross my mind that the board would be composed of employees of the developer and, moreover, that members of the board would reside at the developer’s brothel,” Rothberg said.

Untangling the mess of the TRIC water district took time. “What was revealed to me was how the line between government and business was blurred at the industrial park because of the tax incentives [offered to the companies housed there],” Rothberg explained, noting that many of the companies in the district were large tech companies that were lured to Nevada with the promise of tax breaks. “To that extent, it echoed larger themes I was seeing in the state’s development policies.”

As Rothberg uncovered more about the TRIC General Improvement District, he began to question why the water district was allowed to be considered a public entity in the first place. “They said they wanted to avoid being regulated as a private utility, but that raises questions about how Nevada statutes allow people to avoid regulation,” Rothberg noted.

Rothberg knew his readers would have many of the same questions. What was happening in the TRIC GID demonstrated the ways in which Nevada’s government could be circumvented by private companies claiming to act in the interest of residents while instead doing only what was best for themselves. If one water district was allowed to act this way, it was possible that others would follow suit.

“My philosophy is that to be a good journalist, you should be a good member of the community. You need to be out there doing things, talking to people,” Rothberg said. So, he knew his fellow residents would be interested in the story.

Since he published his story in November 2019, Rothberg says a lot of people have been taking a more proactive role in matters of their community, asking larger questions about the role of government in business, and vice versa. “At the water district’s first board meeting following publication [of the story], board members began reading conflict of interest statements before voting on issues,” he explained of the story’s impact. “In addition, the public water district is pursuing reforms. I’d expect legislation looking at the loopholes and the structure of public utility districts that operate as political subdivisions of the state of Nevada.”

You can read The Nevada Independent’s story, “For years, a public water district blurred the line between business and government — with a developer’s brothel workers at the helm,” here.

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