Late last week, a Federal judge ruled that the US Forest Service failed to comply with the Environmental Protection Act by not gauging the impact that Canyon Forest Village would have on water usage. The Forest Service should have examined the effect of water usage by the 272-acre development, both in groundwater pumping and in hauling water to the site. The judge ordered that Canyon Forest Village be sent back to the Forest Service for further discussion.

Critics of the project, mostly nearby cities that have a monopoly on hotels and restaurants in the area, claimed that the ruling meant the a new environmental impact study would have to be conducted. It took the developers of Canyon Forest Village and the Kaibab Forest more than five years to conduct the initial study. Opponents believe that the ruling is the death knell for the project, especially since last November voters in Coconino County overwhelmingly rejected a rezoning of the property.

But Kaibab Forest officials say that they expect the water issues to be quickly resolved.

The Forest Service had intended to swap 12 disparate parcels within the Kaibab National Forest with the developers of Canyon Forest Village for a 272-acre parcel near the south rim of the Grand Canyon.

DePaolo says that the development group has abandoned plans to transport water for the project from the Colorado River by rail and, instead, will haul it by train from Glendale, a suburb of Phoenix. Water use by the development has been central to the Sierra Club's opposition. Nearly every other environmental group has supported the development, which would curtail vehicle traffic into the Grand Canyon park area. The National Park Service wants the project because it will add much needed housing for park employees.

If the developers can resolve a pending suit sponsored by the Sierra Club, which will be heard later this month, and the court accepts the new water study, they would be free to complete the land exchange and reapply for rezoning on the property with Coconino County in November.

DePaolo says that a new proposal would be considerably smaller than what the county Board of Supervisors approved, which was a 900-room hotel, as much as 250,000 sf of retail space and 2,500 residential units.