In a significant win for opponents of the Village at Wolf Creek, a federal judge on Friday invalidated the U.S. Forest Service’s decision to approve a land exchange that would have essentially served as a green light for a new resort atop the remote mountain pass.

“The order rules in the favor of community groups who have been fighting this ill-conceived project for decades,” said Travis Stills, an attorney with Energy & Conservation Law. “This is an important decision that respects the law, the environment and, importantly, agency staffers who tried to protect the national forest, despite the constant barrage of political pressure.”

In 2015, Rio Grande Forest Service supervisor Dan Dallas approved a land exchange with Leavell-McCombs Joint Venture – spearheaded by Texas billionaire B.J. “Red” McCombs – that gave the developers the access to U.S. Highway 160 they had lacked since the 1980s.

For nearly three decades, Leavell-McCombs Joint Venture has sought to build a resort with a capacity for an estimated 8,000 to 10,000 people on the mountain pass at nearly 10,000 feet and more than 20 miles from the nearest town.

A coalition of environmental groups for two years has challenged the Forest Service’s decision, arguing that the agency unlawfully limited the scope of an environmental analysis and was unduly influenced by McCombs and his political pressure throughout the process.

Senior Judge Richard P. Matsch in no uncertain terms agreed with those concerns.

“What NEPA (National Environmental Policy Act) requires is that before taking any major action a federal agency must stop and take a careful look to determine the environmental impact of that decision, and listen to the public before taking action,” he wrote in his decision. “The Forest Service failed to do that.”

Matsch noted “predictive bias” in the Forest Service’s decision to approve the land swap, suggesting the agency relied on environmental reviews that favored the developers and their request.

“Public awareness of the fragility of the natural environment has greatly increased in the intervening 30 years, and the need for a scientifically based analysis of the impact of the Forest Service decisions in managing national forest system lands to support a decision is imperative in explaining the decision to the public,” he wrote.

Matsch also took issue with the public comment process.

“The 900 public comments in the record show this heightened public awareness of the effects of human disruption of the native environment,” Matsch wrote. “Notably, responses to the public comments were prepared by the contractors who did the work. They would not be expected to find that work to be flawed.”

Throughout the 40-page decision, Matsch continually finds faults, inconsistencies and errors in the long, ongoing process between the Forest Service and Leavell-McCombs Joint Venture.

In the original land exchange request in 1986, for instance, Matsch points out that the Forest Service denied the proposal, on the basis, according to the Forest Service itself, that “environmental, social and economic impacts resulting from the development are not at all clear.”

Two weeks later, the Forest Service inexplicably reversed its decision, approving the land exchange.

Matsch pointed to Deputy Forester Maribeth Gustafson’s 2014 email to a colleague, in which she said of the Forest Service’s abrupt turnaround: “It is commonly understood that Mr. McCombs brought political pressure to bear to realize his dream to develop the ski area.”

Other issues with the NEPA process, the Endangered Species Act as it related to the Canada lynx, as well as the Forest Service’s actions throughout the process, are called into question. Matsch ultimately deems the agency’s actions “arbitrary and capricious, an abuse of discretion and contrary to law.”

“(The Forest Service) failed to consider important aspects of the issues before them, offered an explanation for their decision that runs counter to the evidence, failed to base their decision on consideration of the relevant factors and based their decision on an analysis that is contrary to law,” he wrote.

Because the U.S. Forest Service declined comment for this story, and Clint Jones, a representative with Leavell-McCombs Joint Venture, did not return calls seeking comment, it’s unclear what the next steps, if any, might be for the proposed Village at Wolf Creek.

The Forest Service and/or Leavell-McCombs Joint Venture have the option of appealing Matsch’s decision. Or, they could start the land swap proposal all over again.

A third option, as Stills suggested, would be to abandon the “fantastical proposal” and “put the threat of a massive village behind us.”

“That would make a really good parcel to return to the national forest,” he said.

Jimbo Buickerood of the San Juan Citizens Alliance said Matsch’s strongly-worded decision recognizes the passion residents expressed for the protection of Wolf Creek Pass.

“This victory represents the power all of us to work together for the benefit of wild places, watersheds and wildlife habitat – the people’s voice has been heard,” Buickerood said. “We appreciate the diligence that Judge Matsch brought to the legal case in thoroughly examining the record that highlighted the shortcomings of the NEPA process and the pummeling that the environment would take should the project be approved.”

jromeo@durangoherald.com