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Public officials violated ethics laws over nixed Steamboat Ditch project

By Jeri Chadwell

Two members of the board of directors for the Washoe County Water Conservation District (WCWCD), have been hit with ethics violations following an attempt to secure $25 million in federal grant funding for a controversial project that has since been scrapped.

An ethics complaint was made in January against Louis Damonte and Cory Casazza, as well as two other WCWCD board of directors members.

A Nevada Commission on Ethics (NCOE) review panel in June determined sufficient cause existed for the Commission to render an opinion in the matter regarding their alleged violations of Nevada Revised Statutes governing the code of ethical standards for public officers.

Reno resident Michael Barnes submitted a complaint against Damonte and Casazza—both of whom also are officers of the private Steamboat Canal and Irrigation Company. He also included in his complaint the director of the Orr Ditch and Extensions Water Company John Capurro and Truckee Meadows Water Authority (TMWA) Senior Hydrologist Bill Hauck, both of whom also sit on the WCWCD board. The commission found neither of them violated ethics laws.

In his complaint, Barnes said he was “informed during the beginning of January of 2021 that there was a proposed plan put into motion by several local water irrigation ditch and canal companies to obtain a Federally funded grant for improvements to their privately owned canal/ irrigation ditches.”

He is referring to the plan to use U.S. Department of Agriculture Natural Resources Conservation Service grant funding of up to $25 million to study, develop a plan, and implement improvements to the Steamboat Ditch canal—including replacing approximately 15 miles of open canal with pipelines. The full canal runs for 34 miles through open canals and existing pipelines and is owned by the Steamboat Canal and Irrigation Company.

The federal grant money was awarded to the Steamboat Canal and Irrigation Company—but the company needed a local government agency or entity to serve as its sponsoring local organization (SLO) to gain access to it.

WCWCD voted to approve becoming the SLO for the company in August of 2020. The application for grant funding was thereafter initially approved, with plans for an environmental study of the ditch to inform proposed improvements set to take place through the fall of 2022. However, it was announced in spring of this year that those plans had been put on hold following public outcry.

“I remember saying it, but it wasn’t in the minutes. It only counts if it’s in the minutes. I have disclosed during other meetings that I was on the board for Steamboat Ditch, also.” – Cory Casazza

Barnes noted that in the minutes from the August 2020 WCWCD meeting, during which the board of directors approved the agency serving as the SLO for the project, neither Damonte nor Casazza mentioned a potential conflict of interest or attempted to recuse themselves from the process.

During the meeting, legal counsel for the Steamboat Canal and Irrigation Company, Michael Pagni—who also represents WCWCD—said the reason for the project was to “improve agricultural water management by converting open channel canal to pipe. This will conserve water, improve efficiency and reliability of irrigation operations, and reduce flood risk among other benefits.”

Barnes in his complaint said the statement showed that Damonte and Casazza “would have direct personal, financial and business benefit from such a project as they are also private officers and owners of the Steamboat Canal and Irrigation Company (the beneficiaries of the federal grant).”

He further alleged that Hauck has an interest in the Steamboat Canal and Irrigation Company through his affiliation with TMWA—and that Capurro was in violation of the law too because he indicated during the meeting that he would seek the same grant funding for the Orr Ditch and Extensions Water Company.

Only Casazza and Damonte were found to be in violation of NRS’s code of ethical standards for public officers, its requirements regarding disclosure of conflicts of interest and abstention from voting because of them, and statutory contract prohibitions for public officers. Specifically, the men violated 281A.400 sections 1, 2, 3 and 10; NRS 281A.420 and NRS 281A.430.

The NCOE panel decided that the violations of both men “may be appropriately addressed through corrective action under the terms and conditions of a deferral agreement instead of referring the allegations to the Commission for further proceedings.”

Both will need to comply with ethics laws for two years from the date of the commission’s approval of their deferral agreements, without being the subject of another complaint arising from alleged ethics violations substantiated by the commission. 

They will need to make “proper disclosure sufficient to inform the public of the extent and effect” their private interests have on matters at hand. They will also need to abstain from voting on matters where they’ve conflicts of interest.

Both men will need to “attend and complete ethics training within six months from the date of the Commission’s approval” of their deferral agreements.

The USDA’s Natural Resources Conservation Service confirmed to This Is Reno that the contract with WCWCD and the irrigation company for the federal grant funding was canceled.

This Is Reno attempted to contact Damonte and Casazza. We did not hear back from Damonte. 

Casazza said he is entering into the deferral agreement with the NCOE. He added that he was certain he noted that he’s an officer on the board of the Steamboat Canal and Irrigation Company during the meeting when the WCWCD agreed to be the SLO for the company in its bid for federal dollars.

“I remember saying it, but it wasn’t in the minutes. It only counts if it’s in the minutes. I have disclosed during other meetings that I was on the board for Steamboat Ditch, also,” he said.  

Casazza added that he thinks public outreach to explain the project to the public could have been handled better.

“I think it just got a bad rap. … I don’t think we did, or the government did, a good job of explaining the project and what the benefits were to the public. There were no benefits to the Steamboat Ditch users or very much to the ditch company,” he said. “I think we were just looking forward to the study to find out what the best solution was for the ditch company and for the community.”

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