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Small business sues city in federal court over Kimpton hotel sewer dispute


An injunction against the City of Reno is sought by a small business alleging the city is threatening to shut off its sewer service. Mary and Matt Speth, trustees of the Theresa Frisch Trust, own an office building—the Frisch house—near the proposed Kimpton high-rise building on the Truckee River in downtown Reno.

They sued the city in August and are asking Nevada’s federal district court for a preliminary injunction preventing the city from cutting off sewer service to the house.

“The City is using the threat of cutting off sewer service at the Frisch House to attempt to force the Plaintiffs to allow a physical invasion of their property without just compensation and without complying with the laws surrounding the taking of private property for public use as required by [state law],” the Speths alleged.

The sewer lateral is on the Speth property, and the city proposes to add about 81 feet to it on a different part of the property, court documents note. Before September of last year, Mary said that she and her brother Matt were unaware of any problems with the sewer line. 

“Because of the size and location of the Reno Kimpton, the City’s current sewer main that serves the Frisch House and the Reno Kimpton will need to be either moved or abandoned,” they alleged in a court document. “[Kimpton developer] CAI [Investments] informed the City that the sewer line needed to be rerouted to accommodate the requirements of a modern high-rise. In reply, the City directed CAI to install its own new sewer line and bear the cost, as required by the City’s code.”

Speth said the city is footing the bill for the project to CAI Investments’ benefit, and the city threatened to shut off sewer service if it was not allowed to come onto the Speth property.

“[A] July 12, 2023, letter from the City states that without the installation of the new private sewer lateral connecting the Frisch House to a new sewer main, the Frisch House would lose its sewer service and couldn’t be occupied, and that the work would take approximately three weeks to complete,” she said. 

The city needs to follow its own rules, which indicate a sewer shutoff would have to go through a specific process, including a hearing before the city council, the Speths allege. City Attorney Karl Hall wrote in a July letter that without permission to do the project, sewer service to the Frisch house would end because the sewer main “is being abandoned on September 1.”

‘Time is of the essence’

The city has denied wrongdoing. City officials said the city is offering to pay the Speths for a new sewer line for the Frisch house. Mary said, however, a letter from Assistant Public Works Director Khalil Wilson only gave her two options—the city will replace the sewer line, or the Speths have to do it.

Reno City Attorney Karl Hall during a meeting on affordable housing Feb. 22, 2022 in Reno, Nev. Image: Ty O'Neil / This Is Reno
Reno City Attorney Karl Hall during a meeting on affordable housing Feb. 22, 2022 in Reno, Nev. Image: Ty O’Neil / This Is Reno

“The private sewer lateral on your Client’s property needs to be relocated to connect to the new main,” Hall wrote in July. “Thus, time is of the essence for your Client to sign the permission to enter and construct. Without this new private lateral installed by the City’s contractor, 247 Court Street will not have sewer service and thus will not be able to occupy the property.”

The Speths hired attorney Luke Busby to prevent the city from moving forward with the project. (Disclosure: Busby represents This Is Reno in public records lawsuits, two of which are against the City of Reno. Busby would not comment on this case.)

However, in a later court filing, Hall said, “Nothing is being taken from Plaintiff. Plaintiff will not lose its service. In fact … the City tried to give the Plaintiff a valuable benefit—by footing the bill to connect Plaintiff to a new sewer main.”

Speth countered that this statement contradicts the prior statement by Hall in his July letter. Hall also denied the project is related to the Kimpton high-rise. Busby said, in court documents, public records show otherwise.

In November of last year, attorney Garrett Gordon, on behalf of CAI Investments, wrote to Matt about the project. A couple of weeks later, after no response, Gordon emailed Reno City Manager Doug Thornley and Director of Development Services Chris Pingree.

“Our efforts with the adjacent Arlington property owner were unsuccessful to relocate the City sewer line to accommodate the Kimpton project,” Gordon wrote. “I did not receive a response to the below email. Please note the City does not have an easement for this sewer line and we understand it may already be failing due to its age. We need to work together to find a solution.”

The Speths have maintained they want nothing to do with the project. They said they do not want eight office tenants in the Frisch house to be disturbed. 

“We are asking that you cease and desist including our property in any of your sewer plans for the Kimpton project,” Matt wrote in an email last year. “We are confident that your engineering team can come up with a plan that does not disrupt the existing sewer line/system.”

Nevertheless, the city persisted. In January, Matt reiterated—this time to Pingree—his family’s desire to be left out of the project. 

“As stated in previous emails regarding this subject. [sic] 247 Court Street LLC has asked that our sewer line remain in place and our property not be disturbed,” he wrote. 

Pingree then forwarded that email to Thornley, Assistant City Manager Jackie Bryant, City Engineer Kerrie Koski and the city attorney’s office.

In a court declaration, Matt blamed the entire situation on the city.

“Communications between the owners of 247 Court Street and the City of Reno Public Works since January 17, 2023, have been challenging,” he wrote. “Responses from the City are often evasive, unclear, or delayed, sometimes for weeks. The majority of the delays related to our property can be attributed to the unresponsiveness of the City of Reno Public Works.”

The court in the Speths’ lawsuit ordered both parties to meet in October to discuss the case.  

Another lawsuit still pending

The Kimpton high-rise project has been controversial. The city council in 2019 changed one of its rules governing shade created by large buildings to allow the Kimpton to be built.

There was widespread opposition to the city changing its shade ordinance. Gordon was called upon by Mayor Hillary Schieve at a city council hearing and gave him more time to speak about the ordinance than public commenters would have received. 

 A lawsuit was filed against the city, claiming the shade ordinance hearing at city hall violated Nevada’s open meeting law. District Court Judge Scott Freeman last year denied a motion for summary judgment on behalf of the plaintiffs—Trinity Episcopal Church and others. Freeman said, however, there are pending questions as to why Schieve called upon Gordon to testify.

“There exists a material question of fact as to whether Mr. Gordon was called as an expert with insight that would help the Council address concerns raised by the public during public comment, or was there to speak against the ordnance [sic] inferenced by the Petitioner,” he wrote.

According to court records, the plaintiffs have requested a jury trial, and the case remains pending.

A council member denied at the time that the city was altering its ordinance for CAI Investment’s project, but no other similar project has since come forward.

Public records obtained by This Is Reno show city staff promptly and regularly responding to developer attorneys and lobbyists on major projects, while citizen and news media inquiries are either ignored or can take up to weeks for a response.

Bob Conrad
Bob Conradhttp://thisisreno.com
Bob Conrad is publisher, editor and co-founder of This Is Reno. He has served in communications positions for various state agencies and earned a doctorate in educational leadership from the University of Nevada, Reno in 2011. He is also a part time instructor at UNR.