It was “arbitrary and capricious, and illegal” for Snohomish County to order a formal environmental study of a 600-home development planned in the rural Lake Goodwin area, a judge has ruled.
The King County judge’s legal opinion might open the door for the partners developing the project to recoup more than $2 million in damages from Snohomish County. Directors from Edmonds-based The McNaughton Group said months of setbacks have cost the company hundreds of thousands of dollars in extra environmental studies and millions in carrying costs.
Meanwhile, hundreds of potential jobs went unfilled.
“This is a great project that is sensitive to the community and the environment,” Chief Executive Mark McNaughton said Tuesday. “We’ve gone through trials and tribulations that we shouldn’t have to be going through, and the judge substantiated that.”
The news came as McNaughton struggles during an anemic housing market.
In October, Everett’s Frontier Bank sued the developer and his company, saying it was owed $40 million. The lawsuit will not directly affect the project near Lake Goodwin, a company spokeswoman said. The sides are in settlement talks, but haven’t reached an agreement.
Even with the setbacks, Mark McNaughton vowed, “We will continue.”
The Dec. 7 ruling from King County Judge Paris Kallas overturned an order from Snohomish County hearing examiner Barbara Dykes.
The proposal to build 49 homes on 166 acres came from Lake Goodwin A Joint Venture LLC. That’s a partnership between The McNaughton Group and the California-based Granite Land Co.
The developers sought approval for a rural-cluster subdivision, which would trade greater housing density in exchange for leaving about 70 percent of the land as open space.
The project didn’t just involve 49 houses, though. It was one of nine adjacent land parcels the joint venture was trying to develop in a similar way. All told, there were about 600 houses on 2,000 acres, with about 1,200 acres kept as open space. They would be high-end homes on lots of about 1 acre. The applications were submitted between mid-2006 and mid-2007.
Dykes said she couldn’t approve the first application, despite the county planning department’s endorsement. Instead, she ordered an environmental study showing the cumulative impact of all nine applications. She sent the project back to county planners twice this spring, in April and May.
In October, Dykes for a third time told county planners to do more work. That time, she specified that she wanted an environmental impact statement, a formal study that can take months and cost thousands of dollars.
The King County judge’s recent decision said Dykes can’t do that — and even called her action illegal.
The Lake Goodwin rural cluster development has become a lightning rod for some neighbors and environmentalists, who mobilized against it by forming the 7-Lakes nonprofit group.
The recent turn of events frustrated Ellen Hiatt Watson, who founded 7 -Lakes two years ago and now serves as its spokeswoman.
“Of course I’m sick about it,” Watson said. “It is so difficult for citizens to continually defend themselves in appeal after appeal, which is the corner we’ve been backed into. The hearing examiner took days to receive testimony and carefully weigh the facts. That such a carefully thought-out decision has been overturned is a shame.”
The group is still weighing how to respond, she said.
Tom Rowe, the county’s Planning and Development Services division manager, said it’s now up to the hearing examiner to revisit McNaughton’s project. Planners will review the other eight applications separately, Rowe said.
Dykes had no comment Wednesday. The Hearing Examiner’s Office had not received an order or any other paperwork related to the ruling, said Kris Davis, clerk of the hearing examiner.
Dykes, a former chief civil deputy prosecuting attorney for the county, has been singled out by developers for criticism of the role she plays in the county’s land-use decisions. Many people who have opposed large developments, however, have praised her rulings.
McNaughton hopes to break ground on the first homes near Lake Goodwin in the spring of 2011, chief operating officer Kevin Ballard said. Had the application been approved earlier, the company would have tried to begin work in spring 2010.
Noah Haglund: 425-339-3465, nhaglund@heraldnet.com.
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