04/14/2005 11:00PM

One man's way of making millions

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For more than 70 years, people have come to Las Vegas to gamble and try to make money. Most of them left with less money than they had when they arrived.

For those Las Vegas risk takers with a lot more foresight, a better gamble was buying land. As much as you could afford. As American humorist Will Rogers once said, "Buy land. They ain't making any more of the stuff."

Even that simple formula has been turned upside down in this fast growing desert town. The Las Vegas Review-Journal did an investigative report of land transactions between McCarran Airport and land broker Scott Gragson that lost the citizens of Las Vegas millions of dollars that went into the pockets of Gragson. In some instances within a matter of days, and in a couple cases, within a matter of hours.

Some of the land in question is right across the street from the Daily Racing Form office in Las Vegas at Eastern Avenue near Russell Road.

The newspaper report has led to separate investigations by the Clark County auditor, the Las Vegas police department, the U.S. Department of the Interior, and the FBI.

The story is a remarkable example of bureaucracy run amok. In 1998, McCarran Airport was given management of 5,300 acres of federal land near the airport after the passage of the Southern Nevada Public Lands Management Act.

The airport goal was to manage the land in a way to prevent residential building within flight paths and to encourage commercial and industrial development.

In more than 20 separate land swaps with McCarran Airport, Gragson was able to trade parcels of land he owned for airport parcels that were appraised at equal value. But that's where things went terribly wrong for the citizens of Las Vegas.

Some of the deals took a year or more to complete. Thus a land appraisal that was accurate at the time of contract was woefully undervalued a year or two later due to the skyrocketing land values here.

The Review-Journal report pointed out specific examples:

* A 4.38-acre parcel near Buffalo Drive and the Beltway was appraised at $500,000. Once Gragson acquired the property on Jan. 19, 2001, he sold it three days later to Nevada Power for $1.2 million.

* A 4.39-acre parcel near Russell Road and the Beltway was appraised at $855,000. Gragson acquired the parcel on Oct. 24, 2001 and sold it the same day to PT Properties for $1.5 million.

* A five-acre parcel near Fort Apache Road and the Beltway was appraised at $450,000. Gragson took control on Feb. 8, 2002 and sold it the same day to Larry Swecker and others for $825,000.

* The worst offense was a parcel that was listed for "cemetery-use only" at the time of contract. The parcel was rezoned and Gragson was able to sell it to a grocery store chain for a $5 million profit.

No one has been accused of any wrongdoing. Maybe the investigations will discover that Will Rogers was right and that the entrepreneurial spirit is alive and well in Las Vegas.

Richard Eng is the turf editor for the Las Vegas Review-Journal and host of the Race Day Las Vegas Wrap Up radio show.