HANOVER — A lawsuit alleging that Hanover’s Zoning Board unfairly limited the operating hours and capacity of a proposed 21,250-square-foot church appears headed to a settlement.

Attorneys representing Christ Redeemer Church and the town of Hanover signed a proposed agreement last month that would see some limitations dropped.

However, the deal must go before the nine-member Zoning Board for final approval, and some neighbors are crying foul.

“I can’t figure out what the town is doing,” Jeff Acker, who lives across the street from the site of the proposed church, said in a phone interview on Wednesday. “(The agreement) makes it clear that the town isn’t going to do anything to represent the residents of Greensboro Road.”

For more than 16 years, Christ Redeemer Church has sought to build a house of worship for its more than 400 congregants in Hanover.

The church in 2016 set its sights on building a $5 million structure at 28 and 32 Greensboro Road, but has since faced a fraught approval process.

Neighbors and Zoning Board members have worried the project is too large for the residential neighborhood, would produce too much noise and traffic, and could potentially encroach on nearby wetlands.

And while the church obtained approval from the Zoning Board in April, its leaders said conditions attached were too stringent.

Christ Redeemer Church in June filed a lawsuit against the town, arguing the April decision to grant a special exception for the building project placed unreasonable conditions on the church, including a limit of 300 occupants and operating hours of 7 a.m. to 9 p.m. on weekdays and 8 a.m. to 9 p.m. on weekends.

In court documents, the church argued that the limits were set arbitrarily. Attorneys also said the town’s zoning ordinance discriminates against religious institutions because it requires churches to obtain a special exception in areas of town that don’t require other buildings serving large numbers of people to apply for approval.

The proposed agreement, which was reached through court mediation, would strike several conditions from the Zoning Board’s decision.

Under the deal, the town would scrap its 300-person occupancy limit and also not prescribe hours of operation. A parking limit of 113 vehicles also would be struck from the decision, although the church has agreed to abide by that number.

In return, the church agrees to waive its request for damages and attorneys fees.

Chris Audino, the church’s executive pastor, said he is “very happy” with the deal, saying it would do away with several key sticking points. However, he said, it’s unlikely to end disagreement with neighbors and those opposed to the proposed building on Greensboro Road.

“We’re obviously hoping for the best outcome possible and for that, we want the town in support of the project, we want the neighbors behind the project and we want a place where we can gather as a church family,” Audino said on Friday. “I’m not sure we will accomplish all of those things in the process.”

Hanover Town Manager Julia Griffin declined to say why the town’s attorneys agreed to drop the conditions, saying on Wednesday the case is “complex.”

The lawsuit placed Hanover squarely in the middle of a fight between neighbors who don’t want the development and church officials who argue that federal law trumps parts of the town’s zoning rules, she said.

“The proposed settlement is intended to eliminate the (religious freedom) claims against the Town, knowing full well that by doing that, we then further anger neighbors,” Griffin said in an email. “In essence, the Town of Hanover is damned if we do and damned if we don’t. Nothing new in our world of complex planning and zoning cases.”

Meanwhile, Acker, the church’s potential neighbor, said the deal would give up the few conditions neighbors fought for “in exchange for nothing.”

Acker has filed his own lawsuits challenging the Zoning Board’s April decision as well as an earlier special exception granted to waive wetlands rules. Mediation in those cases hasn’t produced an agreement and could go before a Superior Court judge next year.

Griffin said the Zoning Board hasn’t yet set a hearing date to discuss the proposed settlement. The church also still needs to obtain site plan approval from the Hanover Planning Board.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.