NORTH HAVERHILL — The owners of a major mixed-use development proposed for a 92-acre gravel pit in West Lebanon are challenging a Lebanon Planning Board decision that denied an extension needed for the long-running project to continue.
Bud Ames, the co-owner of Twin State Sand and Gravel, filed a complaint on Nov. 8 in Grafton Superior Court asking a judge to reverse the city’s decision and award damages and attorneys’ fees. Ames hopes to develop 660,000 square feet of retail, office and industrial space off Glen Road in a development that would be known as Iron Horse Park.
Through his attorney, Ames argues the Planning Board violated his constitutional rights by denying Iron Horse Park a two-year extension, halting progress on the 12-year-old project, in which Ames and his partners had invested more than $6 million, according to the court filing.
He contends that the board also acted arbitrarily by invoking a city rule that prohibits projects from obtaining more than one site plan extension. Ames applied for Iron Horse Park’s third extension in May, saying more time is needed to secure a developer with the deep pockets to build out the site.
“The fact that this regulation had been in effect when previous extension requests were made by Twin State and numerous others had been made, the Board had never enforced it,” Manchester attorney Megan Carrier said in the court filing.
A phone message left for Carrier on Tuesday was not returned. Lebanon City Manager Shaun Mulholland declined to comment on the lawsuit.
Ames envisioned a 20-year buildout for Iron Horse Park, with the site housing a 150,000-square-foot commercial big-box store, along with three smaller retail sites capable of supporting restaurants, two office buildings and several industrial buildings near the railroad tracks.
Overall, the project proposed building on 13 separate lots near Route 12A.
However, Ames said on several occasions that he didn’t have the roughly $12 million required to build key infrastructure throughout the property, and struggled to find a developer willing to foot the bill.
The Planning Board voted 5-4 in October to deny the project a key waiver, then formally voted earlier this month, 8-1 to deny a two-year extension.
In the denial, the board cites a regulation barring it from “granting more than one extension for any site plan.” The rule stands unless — based on a legal review — officials determine an extension is needed to protect developers’ constitutional rights, according to draft minutes of the Planning Board meeting.
The Planning Board went on to note that, since 2013, only one of 11 conditions needed to obtain a building permit was completed by Iron Horse’s owners.
Carrier argues in court documents that the Iron Horse project cannot be legally stopped.
That’s because the development gained “vested” rights through millions of dollars in investments, which “changed the property in a tangible way from a gravel pit to a site suitable for the envisioned mixed-use development.” The project has been in the works since 2007 and first won Planning Board approval in 2012.
New Hampshire courts have ruled that developments gain vested status when “substantial construction” is completed on the property or a developer has “incurred substantial liabilities.”
Carrier also calls the board’s use of its extension rule a “gross abuse of power and procedural unfairness,” and pointed out that Lebanon has approved extensions “liberally” in the past.
Carrier said other developments — such as the River Park project along the Connecticut River — have been in the works longer than Iron Horse Park. But that roughly 840,000-square-foot development received the go-ahead in September to continue work.
The Sheriff’s Department has until Jan. 2 to serve the case to Lebanon, which has not been formally delivered the complaint, according to Mulholland.
Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.