Bonanza Village HOA

17. Property Owners Association

Property Owners Association for the individual subdivision or be part of a Master

Association. The Association shall be responsible for the maintenance and upkeep of all

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common areas as well as the enforcement of covenants and restrictions of the

development.” (Henderson Development Code, Chapter 19.5.17)

Las Vegas Mayor Oscar Goodman was forced to respond to these “complaints that

ordinances on the books since 1997 mandate all new subdivisions be structured as homeowner

associations,” saying to angry builders and owners only that, “We can see if we can make some

adjustments.” (City Life, 2000). But such adjustments are neither forthcoming nor likely. The

City of Las Vegas not only requires HOAs in new development, but also encourages existing

neighborhoods that do not have homeowner associations to form them. In 1998, the Las Vegas

City Council unanimously approved a measure directing city staff to work with neighborhood

“community associations” in “crafting plans to guide development” in the City (Zapler 1998)

Through the Neighborhood Services Department, the City has induced over 150 different

neighborhood associations to form (Gottdeiner 1999, 182).

There is one other major ingredient driving the current political economy of Las Vegas,

and that is the competition between the City of Las Vegas and Clark County for tourist dollars.

Downtown Las Vegas, known as “Glitter Gulch,” was the home of the original Las Vegas

casinos. But over the last twenty years, these casinos have been eclipsed by the construction of

giant, spectacular “mega-casinos” on Las Vegas Boulevard, or “The Strip,” outside the city

limits. These mega -casinos are close to downtown and closer to the major airport, but are in

Clark County. They drain tourist revenue from the city, creating a uniquely intense version of the

city-suburb competition for business that is typical of most American metro area. During the

1990s, the City of Las Vegas has fought back against the mega-casinos with a massive downtown

redevelopment effort. Over one-half billion dollars in development funds are being channeled

through the Center City Development Corporation (CCDC), a non-profit corporation that is a

“private-public partnership” modeled after the entity use to redevelop downtown San Diego,

California.

And as in other downtown redevelopment efforts, the poor stand in the path of the City’s

economic resurgence in its competition with the county. The City recently forced one of the

area’s largest homeless shelters out of Las Vegas, denying it title to 10 acres of land it had been

operating on, just north of downtown. As the Mayor and a city council member put it,

"I don't want to see Las Vegas become the only center for the homeless in this valley,"

Las Vegas Mayor Oscar Goodman said. "This is a problem that must be shared with the

entire region." Las Vegas Councilman Lawrence Weekly said he doesn't want a

"homeless Taj Mahal" built on the premises, where a shelter, medical clinic, crisis

intervention facility and job counseling center have operated since the San Diego-based

charity expanded to Las Vegas. (Moller 2001)

Councilman Weekly’s ward includes not only the homeless “Taj Mahal” he spoke of so

compassionately, but also Bonanza Village. As we shall see, the Bonanza Village episode

illustrates the dynamics just described.

CASE STUDY: THE BONANZA VILLAGE WALL

Bonanza Village is a development of single family homes in what is known as the “West

Side” of the City of Las Vegas. The development was established in 1946 with 168 lots. The area

was at that time on the western edge of the city, bordering on the desert. But over the years the

city has spread so far to the west that now the so-called West Side is actually located near the

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center of the city. The West Side is the historically black area of Las Vegas, although in recent

years there has been an influx of Hispanic residents. Bonanza Village is located about 1.5 miles

northwest of downtown Las Vegas, or “Glitter Gulch,” the location of the original casinos that is

currently undergoing large -scale redevelopment.

Bonanza Village is bordered by four streets: on the north by Owens, on the east by

Martin Luther King, Jr., on the south by Washington, and on the west by Tonopah. As originally

constructed the development could be entered by automobile at five places from these public

streets, from all four compass points. It was, and is, zoned “R-E,” or “Residential Estates.” This

classification, sometimes called “horse lots,” bears the official description of providing for “low

density residential units located on large lots and conveying a rural environment.” The lots are

over half an acre in size. There were restrictive covenants, including a whites-only race

restrictive covenant, recorded against the lots at the time of original construction, but, as was

normal for that era, these covenants did not create a homeowner association to enforce them.

There are no private streets or other “common area,” meaning property owned jointly by all

residents. The covenants allow residents a great deal of latitude in the use of their land as long as

it remains a single family dwelling. They are allowed to have various kinds of outbuildings

including stables, guest or servants quarters, and greenhouses; grow crops for wholesale as long

as they do not put up advertising signs; and have a “reasonable number” of animals, including

dogs, cats, and horses, and up to twelve chickens and six rabbits

Many of the houses in Bonanza Village were built in the 1950s and 1960s, and a

substantial number are still occupied by the original owners. These are older people, many living

on fixed incomes. But over the last two decades, there has been an influx of younger, more

affluent residents to Bonanza Village. Presently, the development is more or less evenly divided

between these two groups (Edwards 2000). The newer residents envision remaking Bonanza

Village in the mold of the newer subdivisions, with a homeowner association, walls and a gate,

and a high standard of property maintenance. Given the large lot sizes and proximity to the

redeveloping downtown, they anticipate that a substantial increase in property values would result

if they could make the property fit the expectations of home buyers like themselves—young,

professional, and racially diverse. But older residents are accustomed to the freedom and the

relaxed, near-rural lifestyle that Bonanza Village has always had, and they are fearful that they

will lose their homes through the increase in property taxes and maintenance costs that could

result from gentrification of their development.

The dispute over the Bonanza Village wall is in large part a conflict between these two

groups, and the wall came to symbolize the gentrified Bonanza Village envisioned by the newer

residents and feared by the older ones. The dispute began in the early 1980s, and at every turn

the wall advocates identified themselves as voluntary homeowner association.

Efforts to close off Bonanza Village from the surrounding areas were in evidence as early

as 1981, a group of residents calling themselves the Bonanza Village Homeowners Association

successfully petitioned the City of Las Vegas to vacate four of the five intersections from which

Bonanza Village could be entered, leaving only the entrance from Washington at Comstock on

the south of the development.

The city conditioned its surrender of these streets on the homeowner association

installing “crash gates” at three of the vacated intersections and keeping them locked at all times

but available for emergency access. These gates were never installed, and instead the association

put concrete traffic barriers in place. The net result of this episode was that the city allowed the

notional homeowner association to close the development to vehicle traffic except from the south.

Pedestrians could still walk into the development at these intersections. Some residents protested

the action, but to no avail (Null 1981; Hawley 1982; Ogilvie 1982).

Much of Bonanza Village’s perimeter had been enclosed over the years by walls or

fences erected by most of the 65 lot owners who lived on the perimeter of the development. With

these barriers to entry, and the closed streets, there was enough security and separation from the

9

surrounding neighborhood and security for many residents. However, others were not satisfied

with these measures and they began to campaign for construction of a full perimeter wall.

In 1985, the Bonanza Village Homeowner Association—an unincorporated and voluntary

organization--requested creation of a Special Improvement District in order to build a wall around

the development. A letter from the association to the City Attorney in 1985 requested creation of

an SID for “construction of a masonry wall on the perimeter of Bonanza Village at locations

where said wall is non-existent.” The wall and SID, said the association, would produce

“improved security of total Village area,” “improved property value,” “improved safety for all

residents,” “environmental improvement (reduction of noise level; reduction of vehicle traffic,”

and “better control of unwanted foot traffic” (Simon, et al., 1985). This effort failed.

In 1990, a group of the newer residents attempted to secure passage of an amended set of

deed restrictions which would have created a mandatory membership homeowner association for

Bonanza Village. An incorporated association with power to enforce restrictive covenants would

have been able to finance a wall with homeowner assessments and build a wall without

petitioning the city to create a SID. However, the effort encountered sufficient opposition from

other residents that it failed. Thereafter, the pro-gentrification residents returned to the earlier

approach of using the voluntary homeowner association to petition the city for creation a special

improvement district to finance the wall construction (Williams 2000).

In 1997, the effort began to gain momentum. A new president of the Bonanza Village

Homeowner Association—which was still not incorporated--introduced herself to the

membership in January of that year and announced what would prove to be the pivotal event that

would make the association’s wall a reality: the City of Las Vegas now wanted the wall to be

constructed:

I look forward to working together to make a reality that much talked about block wall.

The City has re-committed itself to the block wall by assigning a full time staff person to

help us achieve our goal. The individual will be working with us from the Neighborhood

Preservation Office on Owens. This is a new and exciting development and shows a

commitment we’ve never had before. There is much development going on around us as

well as inside (There are two new homes currently under construction in the Village). As

I see it, right now is the best time for all of us to pull together to get our wall completed.

I truly hope that you will make a commitment to become more involved in improving

Bonanza Village in 1997. Yes, it’s been difficult, yes, we’ve gone down this road before,

but I say that’s no reason to stop trying! We as homeowners are responsible for what

Bonanza Village looks like and what it is. If we really want to look better, IT’S UP TO

US to clean it up. I’m willing to take responsibility for that and all I need is YOUR

HELP. If the City doesn’t come through for us, I say we come up with another plan and

do it ourselves! Let’s do more than talk, let’s work together to save Bonanza Village.

WE CAN DO IT!. (underlining added; capitalization in original) (Phillips 1997)

The City of Las Vegas was, indeed, now supporting the wall project, with the city

councilman for Bonanza Village’s ward now pushing the project through. This time the project

made sense to a city that was determined to redevelop and gentrify its downtown areas to keep

pace with the County-based Strip. Bonanza Village lay within the West Side areas added in 1988

and 1996 to a special district called the Downtown Redevelopment Area. This district was

receiving special treatment from the City through the Center City Development Corporation, a

non-profit corporation that was coordinating half a billion dollars in downtown redevelopment

efforts. The Bonanza Village wall, and other efforts to make the old neighborhood look like a

contemporary gated community, were consistent with the City’s overall redevelopment campaign.

The wall opponents were no longer just opposing a group of their own neighbors. They were

now, literally, fighting city hall. The association notified the residents in April 1997 that,

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[T]he city now appears to be eager to get this project completed. Councilman Reese is

applying pressure to the department of public works and other city offices to make them

“get on the stick” and quit procrastinating…A “special agent” has been appointed whose

job it is to see that difficulties encountered in the planning and completion of the wall are

quickly resolved…The department of public works has completed detailed drawings of

the perimeter wall. The wall being planned will be 8 feet high. (Bonanza Village

Homeowner Association 1997)

This communiqué also revealed that the association’s plans for Bonanza Village’s

makeover with the gated community image went beyond a mere eight foot wall: “We are

planning to do something nice to the Comstock entrance as a part of the wall project…We would

like to get some kind of nice sign out front saying Bonanza Village and there has been talk of a

guard house being built in the island.”

There were two kinds of homeowner approval needed. First was the requirement of

Nevada Revised Statutes Chapter 271 that SID creation be supported by a petition signed by

66.67 % of the owners who would be assessed. During 1997, the association went about the

project gathering signatures on a petition to create the SID. The petition was drafted by the city

for this purpose. There was major controversy over whether this requirement was satisfied, and

anti-wall forces claimed the signatures had been collected over many years, were obtained with

false information on the cost of the wall, included signators who no longer lived in the

development, and included others who had changed their minds. By September, 2000, 86

complaints from anti-wall residents—a majority of the current residents of the development--

were sent to the state Ombudsman for Common Interest Communities. The complainants

asserted that “their subdivision was illegally organized…without the homeowners’ knowledge,”

and that the protesters “do not want to be represented by the Bonanza Village Homeowners

Association” (Ashworth 2000). But the City and ultimately the courts decided that the petition

requirement had been satisfied, regardless of these protests.

However, there was another set of signatures needed. The chief impediment to what was

now a joint effort of the City and the homeowner association proved to be the need to obtain

easements over the 65 properties that lay on the perimeter of Bonanza Village, where the wall

would be contructed. The City needed a permanent easement for the wall itself, and also a larger

temporary construction easement, and these required intrusion on private property rights. The

homeowner association worked to obtain signatures on both the SID petition and the easement

documents. But ultimately 13 of these perimeter owners did not sign the easement documents in

time, and this precipitated the litigation which eventually took the Bonanza Village case to the

Nevada Supreme Court.

The city set up an aggressive schedule for creating the SID and building the wall, all of

which was to be done between February 1998 and February 1999. One of the items on the

schedule was “Protest Disposal Resolution,” set for May 11, 1998. After the scheduled rejection

of anticipated protests by city council resolution, the ordinance creating the SID was to receive its

first public reading. (Bonanza Village Times 1998)

The schedule had to be set back a bit, and the protests were not rejected until October 12,

1998. Then, the president and vice president of the Bonanza Village Homeowner Association

addressed the Las Vegas City Council at a public hearing on September 28, 1998, to advocate for

the wall project. They began by arguing that the wall was a crime prevention measure needed to

prevent petty burglaries committed with shopping carts. The facts, which were no doubt known

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to everybody in the room, were that the crime rate in Las Vegas was plummeting, paralleling a

similar drop in crime rates across the nation.

much more eloquent in portraying the wall as an esthetic measure that would make Bonanza

Village look like other, newer, communities, and thereby make the neighborhood look like part of

the downtown redevelopment. This, they said, would stimulate community pride and enhance

property values. The president of the association spoke first (Las Vegas City Council 1998):

Our reasons for wanting a security wall around Bonanza Village are the same reasons

security walls have been and are currently being built, in fact, it seems to be the norm

nowadays, in many Southern Nevada neighborhoods surrounding ours, like Summerlin,

Green Valley, The Lakes, and Rancho Circle. We want to discourage crime; namely,

petty burglaries that occur on foot with the aid of a shopping cart. It’s hard to push a

shopping cart filled with a television or a lawn mower through a block wall, but this is the

kind of crime that is occurring in our neighborhood. So, like our surrounding neighbors,

we wish to deter these crimes as well as protect our investments. We want to maintain a

sense of neighborhood pride and improve the appearance of the whole area. Just like

those other homeowners, we expect certain improvements for our tax dollars. Further

because we are one of the oldest neighborhoods in Southern Nevada, meaning we have

been paying taxes for a longer time, we need to know that the City has not turned its back

on us because of the new kids on the block. Bonanza Village lies smack dead in the

middle of a major downtown redevelopment that we want to be a part of. There is the

Fourth Street Corridor project under way, the old Union pacific Railroad land that now

has a beautiful new County building in place, and right on Bonanza the old Dula City

Swimming Pool is being brought back to life. Why should our neighborhood be left

behind? The approval of the SID will breathe new life into the Martin Luther

King/Washington/Vegas Drive area with the building of a security wall and will serve as

an example for others in our area to show what neighborhood pride can do and make—

can be done to revitalize an old and impoverished area. It will stimulate neighborhood

pride and make Bonanza Village a part of the new downtown.

The president was followed by the association vice president, who added to her

comments, noting among other things that the city—not the association--had prepared the petition

that the HOA circulated to obtain the signatures needed to proceed with the SID, and then

proceeding to advocate for the wall purely because it would make Bonanza Village look like

nearby gated communities:

There is some new development that’s happening in our area that we’re excited about.

The Andre Agassi Boys and Girls Club looks really good. The Veterans Hospital close

by us looks good. There’s a new Post Office going in. And also there’s a subdivision

that has planted itself north of us. It’s single family homes and they have a really nice

wall running along Vegas Drive. Now all these good looking projects, when they look

across the road or into our area, they see what typical horse zoned property, the back side,

lots of typical horse zoned property looks like. It’s a mish-mash of different fencing.

Sometimes you’re not going to put your lumber pile in the front yard if you got a half

acre. That’s one of the reasons you own it is so that you can have a few things other than

just landscaping. And so a lot of that stuff winds up in the back yards… The project is

not only good for Bonanza Village, but it’s good for the City. If we do not build this

wall, Bonanza Village will fall behind the level of the new developments coming into our

area and we don’t want that. We’re an inner-city neighborhood that’s willing to spend

our own money to bring itself up to the level of the new stuff that’s moving in around us.

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A third wall supporter made the case even more bluntly, saying, “Today we would like to

see Bonanza Village in the same capacity as any other gated community.”

Those who objected to the wall spoke at this hearing as well, but in the minds of many

the outcome was a foregone conclusion. Five weeks later, on November 9, 1998, Special

Improvement District 1463 was created. The degree to which the City was willing to overlook

obstacles in its rush to build the wall was illustrated by an indemnity agreement which was

entered into on that date between the City of Las Vegas and the Bonanza Village Homeowners’

Association, “a Nevada corporation.” In fact, the association was not incorporated, and did not

incorporate until nearly a year and a half later, on April 7, 2000, with a grand total of 22

members.

But this minor matter—that the city was entering into a contract with an organization that

had no corporate existence—did not stop the City. The indemnity agreement set out the

arrangement for financing, building, and maintaining the wall. Bonanza Village became Special

Improvement District No. 1463 for purposes of building the wall. All property owners within the

development were to pay equal shares for construction of the wall, pursuant to state statute.

Other documents show that the brown, eight-foot high, cinder block wall—two miles of it in all--

was expected to cost over $800,000, and that each lot would be assessed over $5000 to pay for it

(the final cost to be determined after the wall was built), with up to ten years to pay the principal

and interest. After the wall was constructed, the association was to be fully responsible for

maintaining the wall, and the association also agreed to defend and indemnify the City against

any claims made arising from the existence of the wall. The president of the association signed

the indemnification agreement for “Bonanza Village Homeowners Association, Inc.”—the

corporation which did not exist—as did the Mayor Pro-Tem on behalf of the City of Las Vegas.

But, remarkably, the indemnification agreement was then recorded against every lot in Bonanza

Village, as though it were a mandatory membership organization that spoke for all residents,

when in fact it was voluntary and even as late as 2000 only had 22 members. This raised the

possibility in the minds of many owners that they would become individually responsible for

liability under the indemnification agreement, given the fact that the voluntary homeowner

association had no way to raise money except by asking for it from residents and hoping for the

best.

Later, on the Fourth of July of the year 2000, a Bonanza Village homeowner would write

to City Councilman Larry Weekly, the new representative for their ward, to point out the problem

of the non-existent association, and to ask, “Doesn’t the City require documentation that a

Homeowners Association is a Bona -Fide one before awarding $825,000 for an SID?” After

some six weeks had passed, one of Weekly’s employees passed the letter on for reply to the

Supervisor of the Special Improvement District, who responded with breathtaking cynicism,

writing that “The fact that a homeowner association exists in a neighborhood has nothing to do

with the SID process. Their only involvement in this case was to walk the petition around to get

the supporting signatures to start the process.” (Thompson 2000)

Armed with the Special District legislation and the indemnification agreement with the

association, the City proceeded against the Bonanza Village perimeter residents who had not

granted the City easements over their property. Foremost among these was Cuthbert Mack, an

attorney. Mack and other opponents of the wall continued to organize and fight against the wall.

When it became clear that a number of perimeter property owners would not voluntarily sign

away the easements, the city decided to exercise eminent domain and take their property.

June 28, 1999, the City Council authorized filing complaints in eminent domain against the

recalcitrant owners, and on October 19, 1999, the case of City of Las Vegas v. Mack, Case No.

A410116, was filed in the Clark County District Court.

Mack’s argument was that the City lacked authority to take his property for the wall

project, and the eminent domain action violated the Due Process Clauses of the Unites States and

Nevada Constitutions. His central contention was that there was in reality no public use involved,

13

and that his property was being taken by the City for a what amounted to a private use. He also

argued that there was no objective need for the wall, there was no need to take his property to

construct a wall, and that the City had failed to follow the statutory requirements for SID creation,

including lack of notice. (City of Las Vegas v. Mack, Case No. A410116, Motion to Dismiss

Plaintiff’s Complaint, p. 2, lines 13-19). In a separate suit (Mack v. Bonanza Village

Homeowners Association , Case No. A421503) Mack also requested an injunction to stop

construction of the wall until the case could be fully adjudicated, as well as declaratory relief.

On January 31, 2000, the District Court denied Mack’s motion to dismiss the eminent

domain complaint. On April 8, Mack petitioned the Nevada Supreme Court for a writ of

prohibition. On May 3, the City awarded the wall construction contract to a builder, but on June

16, the Nevada Supreme Court issued an order staying the project until it could consider the

merits of the case.

It was at this point that the City revealed just how determined it was to build the wall.

The City took the position that the Supreme Court’s order only applied to the Mack property, and

not the rest of the development. The City ordered the contractor to proceed with the construction,

and so they did. Existing fences and walls were bulldozed, trenches were dug, temporary chain -

link fencing was erected, and piles of cinder blocks and rebar were stacked all around Bonanza

Village. Fire hydrants, water main valves, and telephone poles that serviced Bonanza Village

were walled out of the development.

On July 25, Mack requested a contempt citation from the Supreme Court to punish the

City for violating the order. On August 3, the Supreme Court issued another order reaffirming

the earlier one, and making it clear that the order to stop construction applied to the entire project.

At this point, the City halted the project.

The Supreme Court made it’s third and final ruling in the case on March 15, 2001,

denying Mack’s request for a writ of prohibition. The court ruled that Mack had failed to file a

timely written objection to the SID as required by NRS 271.305, and therefore had waived his

right to object and did not have standing to challenge the formation of the district. On the merits

of his claim, the court held that:

[T]he district court did not exceed its jurisdiction by denying petitioners’ motion to

dismiss the City of Las Vegas’ eminent domain complaint because the right of eminent

domain is an attribute of sovereignty, the express provisions of NRS Chapter 37 and 271

authorize the City to condemn property for local improvements, and a security wall is

defined as a local improvement pursuant to NRS 271.203. Thus, the City’s formation of

a special improvement district (SID) and its efforts to condemn petitioners’ property for

purposes of constructing a security wall are not unconstitutional (Order Denying Petition

for Writ of Prohibition, Mack v. Eighth Judicial District, Case No. 36091; underlining

added).

The underlined language reflects a provision of Nevada law which specifically defines a

security wall as a “local improvement,” so that the City was not required to produce any further

justification—a security wall is,

City in a case involving a special improvement district, the court was upholding a heavy, express,

legislative presumption in favor of the validity of such projects. The relevant provisions of

Nevada law made this clear: