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   This story appeared in The Times & Free Press on Tuesday, March 16, 1999.
   

TVA Blocks Resort Developments

By Dave Flessner
Business Editor

The Tennessee Valley Authority has blocked plans by a pair of developers to build nearly a half billion dollars of controversial residential and resort projects on two of its most popular lakes.

The federal utility announced Monday it will preserve its wildlife areas at Little Cedar Mountain on the Nickajack Reservoir and on part of the Tellico Lake in Loudon County.

The decision appears to end a three-year effort by a Houston development firm, Hines Interest LP, to build a $100 million resort complex alongside Interstate 24 in Marion County. It could also end a more recent attempt by a Lenoir City marina to develop a $350 million golf course, subdivision and resort on TVA property at the Tellico Reservoir.

"After lengthy review by the staff, it is clear that these large tracts of undeveloped land on two East Tennessee lakes should remain available to the public and not be converted to residential and private uses," TVA Chairman Craven Crowell said Monday. "This policy direction reflects a renewed commitment by the TVA board to preserve public lands for the maximum benefit of the people who use them."

The new direction was welcomed by environmentalists who have fought any new development on the Nickajack and Tellico shorelines. Amercian Indians claim the property contains Indian burial grounds and should be preserved as protected natural areas.

"We're just ecstatic," said Tom Kunesh, a council member of Chattanooga Intertribal Association and one of the leaders of the Sacred Little Cedar Mountain Defense Coalition. "We don't need more corporate welfare to help private businesses turn natural areas into hotels, marinas and golf courses."

Hines, an international development firm based in Houston, proposed buying and leasing 740 acres around Little Cedar Mountain to build up to 500 homes and cabins, a 120-room resort lodge, an 18-hole golf course and a 300-slip marina between the Nickajack Dam and I-24.

The project would have generated an estimated 400 jobs and thousands of dollars in extra local tax revenue.

Hines had agreed to preserve 400 acres of the Little Cedar Mountain property for wildlife and public recreation. But after studying the Hines proposal for more than two years, TVA concluded the project wasn't justified.

"The value of retaining these lands for public use has a higher value than any recreational and economic benefits that would have been derived by going forth with these proposals," said Ruben Hernandez, vice president of resource stewardship at TVA. "Economic growth is important, but TVA's mission is multi-purpose. The key is to balance the use of these lands for the best interests of all."

Marion County has long sought development at the Shellmound Recreation Area to help stimulate more tourism, economic activity and tax revenue. More than one fourth of Marion County is set aside for government parks or land trusts and is not taxed by the county.

Marion County Executive Howell Moss, an active supporter of the Hines project in the past, declined Monday to discuss TVA's decision.

"The environmental community has put a lot of work into these projects and I think there was a groundswell of opposition that TVA just couldn't ignore," said Dr. Stephen Smith, director of the Tennessee Valley Energy Reform Coalition, an environmental consumer group which opposed development at both Little Cedar Mountain and Tellico. "We're thrilled with TVA's decision."

Denny Haldeman, an environmental activist opposed to any development on Little Cedar Mountain, said TVA should not turn over public lands acquired through eminent domain to private businesses to make a profit. "That's just plain wrong," he said.

On Tellico Lake, developers Clayton Pangle and Ed Loy wanted to buy nearly 1,800 acres to build one of East Tennessee's largest commercial resorts. The proposed Tellico Landing would have included three golf course, a marina, an equestrian center, a hotel, several restaurants and a subdivision of homes and cabins.

The project was pushed by the Tellico Resource Development Agency, which is trying to market thousands of acres of land in the area. But other lakefront property owners and local environmentalists objected to more development on the Tellico Lake.

"We believe it is important for TVA to continue to maintain these public lands for use by everyone," TVA Director Bill Kennoy said.

Mr. Crowell said TVA will continue to evaluate requests for use of TVA lands. But he said future proposals on TVA land must also benefit future generations and the environment.

TVA's shoreline management plan has already reserved about 38 percent of the lakefront property in the Tennessee Valley for private development and most of that has yet to be developed.

"There is still quite a bit of property available for private development without these two sites," Mr. Hernandez said.

But TVA, which opened Little Cedar Mountain up to development proposals in 1996 when taxpayer funds for recreation programs were slashed, appears to be rethinking its approach to managing such areas.

TVA has leased the Shellmound Recreation Area to a private campground operator to limit its own costs. TVA also plans to spend part of its power budget, as needed, to maintain public recreation areas.

"TVA's public shoreline property has become increasingly important as the region's economy and population have grown," Mr. Crowell said. "The TVA board is committed to maintaining the high standards of resource protection that has defined TVA's integrated resource management for more than 60 years."


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