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News Maryland Eastern Shore

State puts Kent Island project on hold

A developer's request for permits to build a bitterly disputed waterfront housing project on Kent Island has been put on hold after state officials discovered a "business relationship" between a high-ranking Maryland environmental official and a lawyer for the development team.

In a written statement, the state Board of Public Works said Friday that it would delay action on the Four Seasons project pending a review of the relationship between the lawyer and the board's longtime wetlands administrator, Doldon W. Moore Jr.

"The Board of Public Works recently became aware of a business relationship between the wetlands administrator and an attorney representing the applicant for the tidal wetlands license that is referred to as Four Seasons at Kent Island," it said. The board — made up of Gov. Martin O'Malley, Comptroller Peter Franchot and Treasurer Nancy Kopp — said it would review the record of the case to determine whether the handling of the application was consistent with state law.

Sheila C. McDonald, secretary to the board, said Moore recently announced his retirement after 14 years as wetlands administrator. She declined to give further details about his departure.

Moore, who had advised the board that the developers had met all the legal requirements to receive a permit to build in a wetlands area, could not be reached for comment.

John H. Zink III, an attorney representing developer K. Hovnanian Homes, said the relationship in question is one in which Moore and Charles Schaller, another attorney for Hovnanian, served as co-administrators of a family trust.

"We do not see where that has created a problem," Zink said.

The controversy over Four Seasons goes back to the early days of O'Malley's administration, when the governor decided in 2007 to oppose a permit for the project over the advice of environmental officials including Moore. O'Malley, supported by Franchot, said the Kent Island location — on the Chester River just north of U.S. 50 — was inappropriate for what was then a proposed 1,350-home development.

The decision was welcomed by environmental groups as a victory for smart growth, but the developer appealed the decision. Hovnanian prevailed in the Court of Appeals in 2012. The court instructed the board to consider the project's effect only on the wetlands in the immediate area, not the impact on the entire Chesapeake Bay.

Hovnanian brought its application back to the board last summer. The company said it had scaled back the project to 1,079 units, given some of the land to the county for use as a park and reduced its impact on the wetlands to make it more palatable to the community and state officials. Under the new plan, it sought permission to install a sewer line under a wetland and build a pier, but eliminated a request to build a bridge over a sensitive area.

The Maryland Department of the Environment and Moore once again recommended approval, but the board declined to act on the permit, saying it wanted the developer to put its agreements in writing with Queen Anne's County. Though Hovnanian contended it had no obligation to do so, it agreed to talks with county officials.

The Queen Anne's commissioners voted 3-2 to approve an agreement Oct. 8, seeming to remove the final hurdle. On Oct. 24, Zink wrote a strongly worded letter to the board demanding that it put the matter on its Nov. 6 agenda. The board did not, prompting Zink to demand an explanation and press the board to take up the matter no later than Dec. 4.

McDonald told The Baltimore Sun the board would not commit to that timetable, saying there was "no set date" for completing its review.

Schaller said he could not confirm the nature of the relationship or say how long it has continued because of attorney-client privilege.

"There's no improper business relationship with the administrator, and we're confident any review will confirm this fact," Schaller said.

Opponents of the project were quick to cry foul.

Jay Falstad, spokesman for the Queen Anne's Conservation Association, said he found the business relationship "highly questionable" and said the only way to ensure the integrity of the process was to take it back to the Queen Anne's County Planning Commission.

"The only way the citizens can have any degree of faith in this process is to start over," he said.

Such a move, if permitted despite the court's 2012 decision, would set the project back years.

Critics of the project say they have had questions about Moore's handling of the Hovnanian application.

"Throughout the whole process, any interaction with him, he has seemed to act as advocate for the developer," said Gene Ransom, a former Queen Anne's commissioner who has long opposed Four Seasons.

Zink said he doesn't know how long Hovnanian would wait before going back to court to demand state action.

"We have to get some clarity on the situation before we know what our next step is going to be," he said. "We just don't understand how this business relationship has any connection with the wetlands license."

Patrick McNeally, vice president of Hovnanian, said the company is anxious for a decision after an application process that's taken 14 years.

"We're a business, and every month that goes by it costs us several hundred thousand dollars," he said.

michael.dresser@baltsun.com

Copyright © 2014, The Baltimore Sun
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