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Apr. 01, 2009
Copyright © Las Vegas Review-Journal

Developer Rhodes seeks Chapter 11 bankruptcy

By JOHN G. EDWARDS
LAS VEGAS REVIEW-JOURNAL

Developer James Rhodes on Tuesday night filed a petition for bankruptcy on behalf of many of his key businesses, including Rhodes Design and Development Corp., listing $100 million to $500 million in assets and liabilities in the same range.

The developer filed for bankruptcy under Chapter 11, which allows the companies to continue operating while their finances are restructured.


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    • Rhodes has been one of Las Vegas' most successful and controversial developers and homebuilders. He developed Rhodes Ranch in southwest Las Vegas and Tuscany Village in Henderson. He provoked the ire of environmentalists with his development of the Red Rock Country Club community.

    Rhodes drew news coverage again when Erin Kenny, the former Clark County commissioner, disclosed that Rhodes paid her $200,000 a year for consulting as part of an agreement in which she pleaded guilty to federal corruption charges. Kenny was sentenced to 30 months in prison in connection with a bribery case involving former strip club owner Michael Galardi.

    The Arizona Corporation Commission questioned Rhodes about his business relationship with Kenny when he sought to establish a water utility for a master-planned community proposed in Golden Valley between Kingman and Bullhead City.

    The Arizona panel also grilled Rhodes over $148,000 in fines he paid after admitting he illegally funneled campaign contributions in 2002 through employees and employees' spouses to Sen. Harry Reid, and then County Commissioner Dario Herrera. Herrera also was convicted in connection with the bribery case.

    The Rhodes Companies filed the bankruptcy petition but an attachment notes that 31 affiliated companies also are seeking protection under Chapter 11 bankruptcy.

    They include Rhodes Ranch General Partnership, Rhodes Ranch Golf and Country Club, Tuscany Golf Country Club, Tuscany Acquisitions and three similarly named companies, Rhodes Realty, Rhodes Homes Arizona, Rhodes Arizona Properties, Tribes Holdings, Six Feathers Holdings and Bravo.

    Rhodes filed a statement explaining that he believed "it is in the best interests of the company, its creditors" and others to file for Chapter 11.

    The Sunstate Companies of Las Vegas is the largest unsecured creditor and is owed $201,000, followed by G.C. Wallace of Las Vegas, which is owed about the same amount. The developer estimated that between 5,000 and 10,000 creditors will have claims in the bankruptcy case.

    He hired the law firm of Pachulski Stang Ziehl & Jones, which has offices in Los Angeles and other cities, but the petition was filed by Larson & Stephens of Las Vegas.

    Contact reporter John G. Edwards at jedwards@reviewjournal.com or 702-383-0420.

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    Flora Mason wrote on April 12, 2009 11:25 AM: I believe you are in error in saying Rhodes developed the Red Rock Country Club community. It was developed by Sunrise Colony out of California and Arizona.


    stupid filter wrote on April 01, 2009 08:59 PM: If only Rhodes could build a house as good as jan can "mess" up a joke...


    Smart Alec wrote on April 01, 2009 08:56 PM: As usual, the R-J didn't do their research. There were other county commissioners involved in this mess that are not in prison, but should be. . . .


    Smart Alec wrote on April 01, 2009 08:53 PM: And who were the county commissioners that supported this cactus????????????????????????????????????


    SOBs, both of them wrote on April 01, 2009 06:08 PM: $148,000 in fines he paid after admitting he illegally funneled campaign contributions in 2002 through employees and employees' spouses to Sen. Harry Reid

    So, why isn't Reid being held accountable for this bribery?


    shelby wrote on April 01, 2009 05:34 PM: look at the bigger picture here please...there are employees who were most likely left in the dark and have bills to pay and kids to feed, trades who won't be getting paid without a fight and are losing work over this...talk about a snowball affect. maybe the man is getting what's coming to him, or maybe he has an escape route (don't most ppl like this walk away unscathed?)


    Victoria wrote on April 01, 2009 04:43 PM: Oh, lets not forget Jim Rhodes' company Harmony Homes. If you want the same reputation and construction defects as homes by Rhodes Homes, go right ahead and purchase from Jim's "other" company. Funny, how it is listed under his attorneys name. Oh, also do not forget to stop by Jim's wife, Glynda's website for Blackbook702. Those 2 should really be ashamed of themselves & they have what ever coming to them.


    not all bad wrote on April 01, 2009 04:24 PM: In 2007 Jim Rhodes donated 10 million dollars to the Nevada Cancer Center in honor of his father. So, just maybe the guy is not all bad.


    Free Nevada wrote on April 01, 2009 04:24 PM: (@Rob L., the maglev is a 311mph system that you park, swipe your slot-card and walk on..45 minutes later you arrive at MGM CityCenter or Anaheim Stadium. The sad-but-true value proposition for TheOC "native" mentality is: no GAS, no CHP, free drinks and "dood we're going 311mph!". For the Asian populations that now dominate SG Valley and OC as far South as Irvine: "Hey 45 minutes to Vegas with no 5 hour minivan being passed by crazy drivers." For the real tourists, they get a serious 2Fer (Disney/Seaworld and Vegas/River on one airline ticket). For the IE locals, they get 10-15 minute commutes to work without the 91, gas/oil/brakes. Finally, OC will gain access to some affordable housing and Vegas will gain access to some high wage jobs, baseball, hockey, beaches, etc.. --but remember that Vegas is extremely tiny, so this won't even blip on OC radar but will be overwhelming to the value proposition of Vegas.)


    Roger Pewsey wrote on April 01, 2009 04:04 PM: When he first wanted to build in Golden Valley I didn't like what he wanted to do, especially with the water rights he was asking for. I didn't trust him then and still don't. I would be happy as a clam if he was prohibited from doing business in Arizona. He could care less about how his actions effect the population of an area. Keep him out of our state!


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