By TABITHA EVANS MOORE | Editor-in-Chief

LYNCHBURG — The Metro Planning Commission will meet Tuesday afternoon and despite an active interest in developing a set of affordable-housing apartments in Lynchburg, one name will not appear on the agenda, Gateway Development Corporation.

Why? Because the Alabama-based company is now in an active lawsuit against the Metro Planning Commission, the Metro Council, and the Metro Lynchburg Moore County government and “it’s now time to let the lawyers talk,” according to one local official.

Filed on November 7 by Gateway at Lynchburg, LP, the complaint filed in Moore County Chancery Court alleges that Metro Lynchburg–Moore County officials unlawfully blocked its proposed 42-unit affordable housing development on Main Street by rushing through a zoning amendment that violated both state law and the county’s own procedural rules.

{Editor’s Note: Covering litigation and zoning law isn’t glamorous, but it’s necessary. I read every filing, transcript, and vote so you don’t have to. If you value factual, non-sensational local reporting that helps Moore County understand what’s really happening, please consider supporting The Lynchburg Times. Your support keeps every article free to all. You can support me by clicking here.}

Gateway’s application deadline was April 15

The property in question is land located behind the Moore County Co-op.

According to the complaint, Gateway entered into a purchase agreement earlier this year to acquire a 5.13-acre parcel identified as Parcel 004.00 for the construction of a multi-family apartment complex funded through federal Low-Income Housing Tax Credits (LIHTC).

To qualify for those credits, the company was required to obtain letters from local officials confirming that apartment development was permitted under the existing zoning, and that infrastructure such as electric and water service could support the project.

Gateway says it received those assurances.

In late March, Duck River Electric Membership Corporation issued a letter confirming there was adequate electrical capacity for a 44-unit development. On April 2, Metro Mayor Sloan Stewart sent a signed letter stating that apartments were allowed under the parcel’s existing R-1 (Residential – Suburban) zoning classification. According to the lawsuit, a third letter dated April 9 from Duck River’s engineering office again confirmed that sufficient electric service was available. According to the filing, at the time those letters were issued, the zoning ordinance explicitly listed “apartment dwelling” as a permitted use in the R-1 district and imposed no cap on the number of units. There’s also a letter dated March 27 on MUD letterhead from Manager Ronnie Cunningham stating that capacity is currently available for up to 44 units.

The complaint alleges that the Planning Commission did not raise concerns about zoning compliance during its April 1 meeting, instead directing Gateway to obtain confirmation from the mayor.

Gateway contends it relied on that guidance as it proceeded with the state-level competitive bidding process for LIHTC allocations. The application for the development was due on April 15.

Gateway: Changes intended to halt their project

The lawsuit centers on what happened next. On April 21, Councilman Golden – who also chairs the Planning Commission – introduced an amendment to the zoning ordinance that would remove apartment dwellings from R-1 districts and significantly increase minimum lot-size requirements for new multi-family construction. The proposed amendment also created a new maximum of 25 units for apartment complexes. Gateway argues that these changes were crafted specifically to halt its project, which required 42 units to meet LIHTC program standards.

Gateway asserts the amendment was introduced and advanced without proper notice, in violation of Tennessee’s Open Meetings Act, which requires that agendas be made publicly available at least 48 hours prior to a meeting. The April 21 agenda did not include the amendment, according to the filing. The company also argues that the amendment was never published in a newspaper of general circulation nor subjected to a public hearing, both of which are required under state law before a zoning change can take effect.

The lawsuit contends that despite the lack of published notice, the Planning Commission considered the proposal on May 6, and Metro Council approved it on May 19.

Gateway contends that it was not notified that the ordinance had been introduced, debated, or adopted, despite being the only active applicant directly affected by the change.

During the May 19 meeting, according to the lawsuit, council members expressed concerns about the development’s potential impact on the water system and local revenues. The complaint notes that Water Department representatives stated the project would not create additional cost burdens and would generate new revenue for the system. Gateway asserts that the council nonetheless relied on inaccurate assumptions about water usage and tax impacts in deciding to approve the amendment.

Gateway argues that because the county failed to follow the statutory requirements for zoning amendments – including public notice, a public hearing, and proper submission to the Planning Commission – the ordinance is void ab initio, meaning it has no legal effect. The company also claims the process violated the Open Meetings Act, making any action taken at the April 21 meeting void as a matter of law.

The filing states that in October, Gateway submitted its full Site Plan for the development, noting that the application complied with the original zoning ordinance in effect at the time the project was initiated.

The complaint asks the court to declare the May zoning amendment invalid and unenforceable, to confirm that the original zoning rules apply to Gateway’s proposal, and to grant any further relief deemed appropriate.

Facts from transcripts and minutes

Gateway nor it’s representative Troy Woodis appeared on the official agenda for the April Metro Planning and Zoning Commission meeting but was given an audience by Chair Golden during which he explained the basics of the project. According to our transcript from that meeting, Chair Golden told Gateway representative Woddis that he did not feel comfortable signing any letter of intent without the direction of the Metro Attorney Willian Reider.

“I’m not going to feel comfortable signing anything tonight without our attorney here,” he told Woddis.

Gateway nor Woodis appeared on the April 2025 Metro Council agenda.

During the Planning and Zoning report under departmental/committee updates, Golden raised the idea of moving apartments out of the R-1 residential district and into commercial zoning, along with increasing lot-size requirements and capping the number of units per development.

Golden did ask for an impromptu motion for a first reading of the but according to The Times transcript, the Council did follow Robert’s Rules of Order though it was procedurally a bit wobbly.

Robert’s Rule requires that a member obtain the floor, make a motion, and receive a second to advance any measure. The Chair must then restate the motion and allow discussion/debate. Finally, there’s a vote – either through acclimation or roll call (if it involves money – and they the Chair announces the result.

According to the transcript, Golden asked for a first reading to move apartments out of residential into commercial. Chair Amy Cashion then restated it: “moving apartments from R1 into C1. Discussion.” That appears to comply and the motion passed unanimously.

Golden then sought a first reading to change the lot size, which followed the exact same track. That measure also passed unanimously.

During the discussion about doubling square-footage requirements and adding a 25-unit cap, members briefly debated before a clear motion was restated on the record. Chair Amy Cashion paused to confirm there was a motion and second, then summarized the proposal before holding a roll-call vote, which passed 11–4.

Gateway’s complaint includes a March 27 letter from Metro Utilities stating capacity was available. However, during the April 21 meeting, MUD Manager Ronnie Cunningham told council members that once usage hits 80 percent, state rules require the utility to begin planning upgrades – and that if Jack Daniel’s grows significantly, the system could no longer absorb additional demand.

“We can take growth right now, but if Jack Daniels’s gets any bigger, we won’t be able to,” Cunningham told the group according to the minutes.

That measure passed by a 11-4 margin with Marty Cashion, Dexter Golden, Jimmy Hammond, Darrel Richards, Arvis Bobo, Bradley Dye, Houston Lindsey, Peggy Sue Blackburn, Amy Cashion, and John Taylor voting in favor and Shane Taylor, Douglas Carson, Gerlad Burnett, and Greg Guinn voting no.

Gateway’s complaint alleges that the amended ordinance was never subjected to a proper public hearing and that required notice was not published in a newspaper of general circulation. However, the minutes of the May 19 meeting reflect that the Metro Council held a 6:20 p.m. public hearing on the apartment and lot-size changes; the hearing closed with no public comments. The minutes do not indicate whether the notice requirements cited in the lawsuit were met.

The second reading was later passed during the regular May meeting by a vote of 10-5.

Robert Bracewell, Marty Cashion, Arvis Bobo, Bradley Dye, Amy Cashion, Jimmy Hammond, John Taylor, Dexter Golden, Houston Lindsey, and Peggy Sue Blackburn voted in favor of the change and Darrel Richards, Shane Taylor, Gerlad Burnett, Douglas Carson and Greg Guinn voted against it.

What happens next?

Now that Gateway at Lynchburg, LP has filed suit against the Metropolitan Government of Lynchburg–Moore County, the case enters the early procedural phase of Chancery Court litigation. While every case moves at its own pace, the process generally unfolds in several predictable steps. Metro Moore County will have 30 days to file a response or a motion to dismiss.

An answer would respond to the allegations paragraph by paragraph. A motion to dismiss would argue that the lawsuit should be thrown out before reaching the merits, often on procedural or jurisdictional grounds.

Given the nature of this case – focused heavily on whether the Metro Council and Planning Commission followed statutory requirements – the county could pursue either route.

Gateway is seeking a declaration that the amended zoning ordinance is void ab initio. In some cases, plaintiffs also request temporary injunctions to freeze enforcement of a disputed ordinance while the case is pending. Whether that occurs here will depend on filings made after service.

If the case moves forward, it will enter discovery, which is the evidence gathering stage. Because the core claims involve the Open Meetings Act and statutory zoning procedures, discovery may focus heavily on timelines, public notice documents, and staff communications.

If there is no motion for summary judgement, the Chancery Court will hear the case. The judge could uphold the ordinance, strike it down entirely, or require the county to re-do the process correctly.

While the lawsuit proceeds, the future of the 42-unit affordable housing development remains uncertain. If the court rules in Gateway’s favor, the project would likely return to the Planning Commission for review under the original zoning rules.

If the county prevails, Gateway may have to redesign the project – or it may become financially infeasible under LIHTC guidelines.

This is an ongoing story, and The Times will report more as additional facts become available. •

About The Lynchburg Times:
I’m an independent, reader-supported, professional journalist covering Lynchburg the way it should be covered: in person, with context, accuracy, and a commitment to the truth. I show up in the rooms where decisions are made, track the details that matter, and bring you reporting you won’t find in any automated feed or secondhand summary. Your support allows me to keep doing this work — and keeps my articles free for everyone. If you value this work, you can support it here.