Forest Service Agrees To Allow Permittee To Continue Selling Limited Use Ownership Of Its Resort Cabins

The Forest Service recently agreed to allow a Forest Service resort owner to continue with a previously approved strategy to raise capital by selling limited use ownership interests in park model cabins at the resort.  The resort is authorized under a term permit and is located on the Fremont-Winema National Forest.  The agency had initially approved the permit holder’s business model , which was incorporated in the permit.  After a change of agency personnel at the Forest, the agency subsequently decided that the practice of selling cabins violated the permit because it involved a change in ownership of the structures.  The agency then terminated the permit.  The permit holder challenged the agency action in court and the agency then agreed to allow the permittee to continue with the sale of the limited ownership interests in the cabins, pursuant to certain additional conditions.

At the time the permit was terminated, the permittee had sold 10 of the 24 cabins which were in place at the resort.  The cabins are park model types intended for long term use, but are movable.  As part of the settlement, the Forest Service imposed several new criteria on the continued operations and any new installation or sale of cabins.  The permittee was required to enter into formal leases with the cabin owners for use of the cabins as part of the resort operation.  Under the terms of those leases, when they expire, the cabin owners are required to resell the cabins to the permit holder at market value or remove them from the Forest.  The Forest Service also agreed the permittee could install up to 43 total cabins which could be sold to third parties.  However, before installing any new cabins, the permittee has to complete a master development plan and pay for applicable environmental analyses.