Truckee Carson Irrigation District indicted
December 4, 2008
RENO, Nev. (AP) ” A federal grand jury indicted the Truckee Carson Irrigation District and four of its employees on Wednesday for allegedly falsifying records to secure additional water supplies from the U.S. government.
The four indicted include David Overvold, 58, project manager for the irrigation district based in Fallon, and Lyman McConnell, 64, the district’s lawyer. They and two others are charged with conspiracy to defraud the U.S. Bureau of Reclamation, falsification of records, false claims and false statements.
If convicted, they could face 20 years or more in prison.
McGregor Scott, U.S. attorney for eastern California, said the four allegedly were part of a scheme to inflate data from 2000 through 2005 regarding the efficiency of the district’s water deliveries so as to secure additional water credits from the bureau to boost supplies primarily for Nevada farmers and ranchers.
Under a contract with the Bureau of Reclamation, the district operates the irrigation system in northern Nevada’s Newlands Project created more than a century ago.
As part of a water efficiency incentive policy adopted in 1988, the bureau agreed to provide credits to the district that would allow it to boost its share of water supplies from area dams and reservoirs owned by the bureau.
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The 10-count indictment handed up Wednesday accuses Overvold, McConnell, Shelby Cecil, 65, and John Baker, 63, all of Fallon, of inflating those efficiency rates in part by recording water deliveries that were not made and tampering with water meters that recorded water flow data.
The indictment said the four “knowingly combined, conspired and agreed among themselves … to defraud the United States by impairing, impeding, obstructing and defeating the lawful functions” of the bureau “through deceit, craft, trickery and dishonest means.”
The fraud resulted in the district receiving 45,000 acre feet of water in the form of incentive credits from 2000 through 2005, the indictment said. One acre foot is equal to about 326,700 gallons of water.
During a normal water year, the district delivers about 270,000 acre feet of water to about 2,500 water users. The water originates primarily in Lake Tahoe, flowing down the Truckee River through Reno and into a series of canals and other dams. Some of the water reaches the Lahontan Reservoir near Fallon, about 60 miles east of Reno
“Water is a precious commodity in Nevada and throughout the West,” Earl Devaney, inspector general for the U.S. Interior Department in charge of the bureau, said Wednesday. “The behavior alleged in this indictment undermines the integrity of the water system and cannot be tolerated.”
A woman at the district office in Fallon said no one was immediately available to comment.
Reached on his cell phone, McConnell told The Associated Press it was the first he had heard of the charges. He said he had not seen the indictment.
“I’m kind of surprised by it,” McConnell said. “I guess I’ll get a copy of it eventually.”
The U.S. Attorney’s Office for the eastern district of California is prosecuting the case because the Nevada district has recused itself to avoid any perception of potential conflict with an unrelated civil action, Scott said.
“Fraud that undermines the government’s ability to manage and preserve our natural resources is a serious offense,” he said.
The defendants are scheduled to appear in federal court in Reno for an initial appearance and arraignment before U.S. Magistrate Judge Robert A. McQuaid Jr. on Dec. 8.
If convicted, each faces up to 20 years in prison for each count of falsification of records and five years in prison for each count of false claims, false statements, and for conspiracy to defraud the United States. They also face maximum possible fines of $250,000 for each count.
If convicted, the district could be fined for each count twice the gross gain or loss suffered to another, or $500,000, whichever is greater, Scott said.