Morgan • Wasatch Peaks Ranch estimated it could lose $455 million this year and up to $600 million next year if a judge issued a preliminary injunction forcing the private luxury ski and golf resort to halt construction and sales. In addition, Morgan County could lose several million dollars in tax revenue, the county attorney warned.
Constitutional rights, the judge countered, are worth far more than that.
In front of a Morgan County courtroom so packed that people listened in from the hallway, Second District Judge Noel Hyde ruled Wednesday in favor of granting the preliminary injunction, which effectively puts construction and sales at Wasatch Peaks Ranch on ice for an indeterminate time. In making his ruling, the judge said the right of the people to exercise their right to referendum is worth far more than the potential losses the uber-exclusive resort, its contractors and the county may suffer.
“Constitutional rights,” he said, “are not for sale.”
Judge Hyde also ruled that the five Morgan County residents who requested the injunction will not be required to set aside a “security” to pay back the resort for losses if the injunction is overturned on appeal.
“Constitutional rights are zealously guarded and protected by the court,” the judge said in issuing his ruling. “To suggest a party is required to post a substantial bond in order to vindicate their constitutional rights actually puts a price tag on those rights.”
The five Morgan County residents said they requested the injunction out of frustration.
In September, after four years of legal wrangling, the residents won the right to put to referendum the special zoning laws the county council adopted for the resort in 2019. The residents and their lawyers believed that while the referendum is in play, state law mandates the land return to its original “forestry” zoning designation. So, when the resort proceeded with construction and the county commission approved more development plans within weeks of the ruling, they took action.
Wednesday’s hearing came less than a week after Hyde granted the five residents’ request for a temporary restraining order. That order is set to expire Dec. 14 but will be rendered moot after the preliminary injunction is entered into court records, even if the county or resort appeals the injunction.
In a statement to the Tribune, managing director Ed Schultz said Wasatch Peaks Ranch plans to appeal the ruling to the Utah Supreme Court.
“Despite the efforts of the five plaintiffs,” Schultz said in the statement, “we continue to feel supported by the residents of Morgan County, many of whom were in the courtroom yesterday supporting Wasatch Peaks Ranch. We believe The County and WPR will ultimately prevail in the Supreme Court.”
The resort’s attorney, Mark Gaylord and Garrett Smith, the Morgan County attorney, argued that “resort special district” zoning designation issued by the council in 2019 should be the standing ordinance. They said that designation took effect in 2019 when the county clerk initially denied Whitney Croft, David Pike, Robert Bohman, Brandon Peterson and Shelley Paige’s petition for a referendum. That denial triggered the lawsuit that eventually resulted in Hyde’s decision in September to allow the zoning change to be put to vote. Wasatch Peaks Ranch and Morgan County immediately appealed that decision and it is expected to be heard by the Utah Supreme Court. No trial date has been set.
Gaylord had two explanations for his stance. For one, he noted that the resort and the county have been operating for four years under the new zoning. In that time, three ski lifts, several houses and numerous roads have been built on the 12,700-acre parcel just west of the community of Peterson. Wasatch Peaks Ranch even purchased two fire engines for the area. In addition, he argued that the residents hadn’t voiced formal objections to any development requests and thereby hadn’t exhausted their “administrative remedies.”
However, project critic Cindy Carter said she spoke up at a county commission meeting in 2020. The commission was considering approving the development plan for Wasatch Peaks Ranch’s first plat, and she raised her concerns that construction might be approved while the referendum lawsuit was ongoing. When asked by a commissioner about that at the time, county engineer Mark Miller said the resort had vested rights. He added, however, that if Wasatch Peaks Ranch moved forward with construction, it would be doing so “at its own risk.”
Judge Hyde agreed with that assessment Wednesday. He said his interpretation of the law is that the zoning laws that were in place before the council voted to change them are the ones in effect until voters decide to change them. The amount of time that has passed or money spent until that time is not relevant, the judge said.
“The language of the Constitution that says the referendum is to be submitted to the voters before the law or ordinance takes effect does not have any time limitation,” he said. “It doesn’t say ‘Unless the decision isn’t made for six days or seven days or 30 days or 90 days or a year or five years or anything.’”
The judge and lawyers will convene Dec. 14 to set a date for the preliminary injunction trial. Judge Hyde said the injunction maintains the status quo, meaning nothing has to be torn down but all construction and sales must be halted. In addition, the county cannot approve any permits nor send any inspectors to resort properties.
Carter said all the residents have wanted from the beginning is to be able to exercise their constitutional rights.
“That’s what we’ve been fighting against the whole time, that they were thwarting our constitutional rights and have been bullying us to have us let go of those. And the county has been ignoring [our rights],” Carter said in a phone interview Thursday.
“I felt like the Constitution won yesterday.”
In a previous trial, Hyde chastised Wasatch Peaks Ranch for suing the county clerk, which he said the resort did “with the intent to intimidate the clerk.” The resort also sued the residents and Carter for $10 million in damages, but that case was dismissed.
One issue both sides agree on is that the contractors and construction companies who are involved with the development of the resort and related residential properties are the ones who will bear the brunt of the injunction. Schultz said in his statement that he believes that pain will extend to the county institutions and services that would have benefited from taxes and fees generated by the resort. The taxes from the construction of one home, Gaylord said, could be worth upward of $90,000.
Smith noted in his arguments that despite not raising taxes, the Morgan County Commission was able to approve an increased budget for 2024 during its meeting Tuesday night.
“While impactful to WPR,” Schultz said, “this ruling is also detrimental to the taxpayers of Morgan County, the school kids of the Morgan County School District, and the hundreds of local contractors, subcontractors, and WPR employees whose livelihoods are now threatened.”
Many of the people in the courtroom Wednesday are contractors or work for Wasatch Peaks Ranch in some capacity.
“They’re the innocent parties in this whole thing,” Carter said. “There are those that are going to want to blame us for that. And I understand that. But [the fault] lies in the county’s hands and Wasatch Peaks Ranch’s hands, knowing fully well they were moving forward on stuff even though it was against [the law].”
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