Kit Kat brothel about to get new owners

YERINGTON - New owners hope to take over the Kit Kat Ranch brothel in Mound House in about two weeks.

Stanley Burton and Frank Leonardi received their brothel, business and liquor licenses Thursday from the Lyon County Commission.

The brothel is under contract to sell once the operators have the necessary licenses. Leonardi's attorney, William Rogers, said escrow should close in about two weeks.

Burton and Leonardi formed Western Sierra Corp. to operate the brothel. A California land development corporation called Cypress Abbey is buying the brothel property with Western Sierra owning the brothel business on a long-term lease, Rogers said.

Financial terms were not disclosed.

Burton owns all the stock in Western Sierra. Burton serves as the corporation's president and vice-president and Leonardi is secretary and treasurer.

Rogers said Burton was a federal attorney in the Reagan and Bush administrations and Leonardi managed a golf course in California for 25 years. Both men are retired.

The Kit Kat Club is one of four brothels in Mound House, where all of Lyon County's brothels are.

Part of the sale negotiations are shared cost for a recently installed $15,000 fire detection system. The Kit Kat is across the street from the Sagebrush brothel, where fire sparked by a candle consumed half the brothel in October.

Rogers said the new owners plan to upgrade the brothel but plans have not been completed.

"They hope to enhance the physical plant," Rogers said. "It needs to be upgraded."

Lyon County commissioners unanimously approved the licenses, though Commissioner Bob Milz tried to include a special-use permit. The brothels in Mound House are not on land zoned for brothels, but a grandfather clause allows them to continue as brothels, Deputy District Attorney Steve Rye said.

"The district attorney says you can't require a special-use permit," Rye said.

Rogers pointed out that a special-use permit is moot since the commission has absolute authority anyway with the brothel license, which is a privileged license. This involved each applicant to pay a $4,000 fee for a background check detailing where they have lived and worked the past 10 years.