Ashland Capital Corp. has an option to buy Willow Creek Golf Course which expires Sept. 5, according to testimony in a court case last Thursday.

Ashland Capital was in 5th District Court in a dispute with Utilities Inc. over supplying water to Willow Creek Golf Course. A motion by Ashland Capital for a preliminary injunction against Utilities Inc. to supplement recycled effluent with well water free of charge was ruled defective during a previous hearing.

The golf course owners will have a chance to amend their legal motion for a Sept. 22 hearing.

Ashland Capital, a finance company based in San Diego, Calif., and second trust deed holder of the property, foreclosed on the Willow Creek course in February. The course was formerly owned by AMI Management. Jorie Enterprises then foreclosed as the first trust deed holder and is now the owner.

"They are in negotiations with Jorie to buy the golf course," Utilities Inc. attorney Laura Granier told 5th District Judge John Davis in presenting a quick history of the litigation. "Ashland has an option to purchase the golf course."

But golf course owners continue to wrangle in court with Utilities Inc. over the tripartite agreement signed by the former golf course owners Preferred Equities Corp. (PEC) in 1999, which required the supplementing of well water, if recycled effluent isn't sufficient to water the course.

Dale Kleven, attorney for Ashland Capital, said the original tripartite agreement stated PEC would purchase any well water needed to supplement the recycled effluent from a sewer treatment plant and be reimbursed by Central Nevada Utility Corp., which was a subsidiary of PEC.

Preferred Equities declared bankruptcy in 2002. Utilities Inc. acquired the assets of Central Nevada Utility Corp., which supplied water and sewer service for the Calvada project.

Kleven argued under the tripartite agreement Utilities Inc. should only charge the owners of Willow Creek Golf Course for the electrical cost of pumping the well water, which amounts to 17 cents per 1,000 gallons.

Granier countered the Willow Creek owners have to pay the irrigation rate of 60 cents per 1,000 gallons. Their cost of service to provide the well water as determined in the last rate case in 2007 by the Public Utilities Commission, plus a $72,000 deposit.

Granier said it would be discriminatory against other customers of Utilities Inc. to provide well water free to the golf course.

Both parties agreed to continue a temporary restraining order signed last October, requiring Willow Creek golf course owners to accept the recycled effluent from Utilities Inc. pending the Sept. 22 hearing.

That order was approved after the former owners of Willow Creek, AMI Management, shut down the course and ponds were overflowing with unused effluent.

Utilities Inc. Regional Vice-President of Operations Paul Burris said his company is pumping 550,000 to 600,000 gallons per day of recycled effluent to Willow Creek Golf Course from the sewer treatment plant by the old 11th hole.

Davis said a separate agreement between Willow Creek owners to transfer 450,000 gallons per day to supply Lakeview Executive Golf Course executed in 2004 did not pertain to the current litigation.

Willow Creek owners claim the recycled effluent is too contaminated with fecal coliform to be transmitted to the Lakeview course. They stopped transferring the effluent to Lakeview for a while back in July.

Ashland Capital said Utilities Inc. needs to furnish well water to dilute the ponds in the summer months.

"The tripartite agreement says Utilities Inc. is supposed to supplement whatever the golf course needs with well water at their cost," Kleven told the judge.

Utilities Inc. claims the ponds are too polluted because they haven't been maintained properly, not because of their effluent.

Utilities Inc. presented an affidavit from Mark Clarkson, a PUC water engineer, who testified Willow Creek owners weren't performing the required maintenance to the ponds receiving the recycled effluent during an inspection in June.

Clarkson said Willow Creek owners didn't begin to maintain the ponds until Nye County Emergency Services issued a letter about excessive fecal coliform levels.

"The county issued an emergency order to Jorie that they maintain the ponds," Granier told the judge.

Clarkson's affidavit stated the effluent from the sewer treatment plant has been in compliance with regulations set by the Nevada Division of Environmental Protection. He attributed the high fecal coliform rates in the ponds mostly to animals like ducks, geese, dogs and rabbits, as well as run-off from surrounding land.

"The alternative proposed by WCGC (Willow Creek Golf Course) to fill the ponds with potable water will not reduce the fecal coliform count," Clarkson wrote. "Furthermore, the addition of water to the ponds without an effective pond management strategy will only cause the fecal coliform to increase."

Clarkson suggested removing debris, flushing out the ponds, applying chemicals, aeration, or removing the water from the ponds and drying them out.

The complicated case, which has resulted in motions for injunctions and counterinjunctions, led Davis to remark, "Why you people want a jury trial absolutely astounds me."