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Holladay voters rejected Cottonwood Mall development, but project could still survive

Housing project's survival hinges on court ruling — but if it doesn't come soon, developers could walk

HOLLADAY — Even though Holladay voters shot down a controversial development on the site of the old Cottonwood Mall, the status of the project remains in limbo, days after the election.

Whether voters' decision even matters remains tied up in the Utah Supreme Court — but even if the court rules against the validity of the referendum, the project still may not happen.

That's because if the court takes much longer to hand down a ruling, the developers may choose to walk away.

Ivory Homes CEO Clark Ivory told the Deseret News on Thursday if the court doesn't announce its ruling in a reasonable amount of time — within, hopefully, weeks — developers may be forced to scrap the project.

"We're hoping it will come out sometime in the next couple of weeks," Ivory said. "If it went beyond (that), then it would pose difficulties with us and the commitments we've made to the seller."

Ivory said Ivory Homes and its partners at Woodbury Corp. decided in a meeting Wednesday they must wait for the court's opinion, "and as soon as they do, then we can start making decisions." But if that ruling doesn't come soon, that puts the entire project at risk, he said.

Either way, however, Ivory said developers are invested in the court battle because a ruling in favor of the validity of the referendum could have far-reaching impacts on development issues across Utah.

"Once we have clarity, we can make decisions," Ivory said. "But right now, we don't have clarity."

In a process that began nearly two years ago, city officials had given unanimous approval to the developers' proposed project, which was revised from a higher density plan to build 775 high-rise apartments, more than 200 homes, and dozens of shops and restaurants on the 57-acre site.

Concerned by the level of new density the project would bring to Holladay, a citizen-led group gathered enough signatures to put a referendum on the ballot.

City officials, arguing their approval of the plan was administrative, rejected the referendum but still printed the issue on the ballot in case it was challenged in court. Sure enough, referendum organizers sued, and a 3rd District judge ruled in favor of the referendum. City officials and developers then appealed to the Utah Supreme Court in September.

As election night tallies posted Tuesday night, Holladay Mayor Rob Dahle expressed frustrations about the absence of a court ruling.

"I remain both surprised and disappointed (the court) did not weigh in prior to Nov. 6," Dahle said in a statement Tuesday night. "We hope to have that decision from the court in the near future, as the city still desires direction regarding future disposition of applications to amend the Cottonwood Mall (plan)."

Thursday, Holladay voters' stark opposition to the project stirred deep concerns from business leaders about the implications of the referendum and how it could impact Utah's creeping housing crisis.

"The overall sentiment of NIMBYism is concerning," said Abby Osborne, vice president of government affairs for the Salt Lake Chamber.

"The irony of this is people are saying to put it somewhere else. Where? Then it's in someone else's backyard," Osborne added. "We are by no means saying density needs to go everywhere … but we all have to do our part to absorb the population growth. And we're on a finite amount of land here."

Osborne said whether Utahns like it or not, growth is happening, and "the thing people are forgetting here is the majority of population growth is from our own children and grandchildren wanting to stay here."

The state's population, roughly 3.2 million now, is estimated to hit 5 million by 2050. According to the University of Utah's Kem C. Gardner Policy Institute, Utah has gained 160,000 new households, or families, since 2011. Over the same time, it has created just 110,000 new housing units. Housing prices, meanwhile, are climbing 10 times faster than wages.

"It's simple economics: supply and demand," Osborne said.

If new housing units aren't built fast enough to keep up with demand — and if residents are able to fight every project they dislike — Utah's housing prices will continue to rapidly climb, she said.

"I don't know that people actually realize that when they're saying no to these developments, they're saying 'no' to just advancing our quality of life," Osborne added.

Paul Baker, referendum organizer of the group Unite for Holladay, said Tuesday's vote "clearly sent a strong signal to the city that they're out of touch with what people want."

"We would recommend the city take a pause on the project, really digest the process, and understand what people want before revisiting it," he said.

Overall, Baker said citizens want to see the site developed "in a way that creates enduring economic and community value."

In response to the criticism, Baker said referendum organizers "wear the NIMBY badge with honor."

"If density needs to be absorbed by cities, it has to be planned very well," he said. "Clearly the majority of Holladay disagrees with the plan."

Baker added that even though developers and city officials feel like they addressed concerns in the development's revised proposal, the vote shows "they did not do so adequately, or a citizens group would not have risen up and spent their summer fighting this."

"Nobody's going to do referendums on reasonable projects," Baker said. "It's not worth the effort. … Clearly, that was not the case here, and the vote shows that."