FORESTBURGH – On July 9, the U.S. District Court ruled in favor of the Town of Forestburgh by dismissing all discrimination and land use claims asserted by Lost Lake Holdings, LLC. 

These claims centered on the town’s enforcement of zoning regulations on the property owners who were seeking to build a resort-style housing development in Forestburgh. 

Town of Forestburgh Supervisor Dan Hogue said in a statement to the Democrat, “The federal court’s ruling confirms the town’s long-standing position that the developer’s material changes with respect to the Lost Lake project require further review by the town and the town’s actions were lawful, appropriate and consistent with its obligations under local and state law.”

Lost Lake Holdings, LLC (LLH) alleged that the town, motivated by religious discrimination, prevented construction of the Lost Lake resort development in Forestburgh. The principals of LLH are practicing Hasidic Orthodox Jews. 

Representatives from LLH could not be reached by presstime.

Plans for the property 

The LLH partners purchased the property in 2020 from developers named Double Diamond who originally bought the 3.3 square-mile undeveloped parcel of land in 2008 with the intention of developing it into an upscale, resort-style destination with a gated community, hotel and conference facilities and recreational amenities including an 18-hole golf course. 

At that time the property was located within a residential zoning district. So Double Diamond applied for a zoning change to a “Planned Development District” (PDD) and commenced an environmental review. 

After a multi-year process, the town board approved Double Diamond’s PDD application and voted to rezone the property, subject to the environmental review findings. 

But in 2020 LLH purchased the property and, according to the town’s Zoning Board of Appeals, intended to develop the property into a high-density housing development for full-time residents and families – without the environmental mitigation measures identified during the earlier environmental review process. 

According to the U.S. District Court ruling, “the parties dispute what happened next.” 

Lost Lake Holdings contend they were allowed to begin infrastructure work, but the town says they engaged in unauthorized construction and issued a series of stop work orders in 2023 and began legal proceedings.

Claims of discrimination  

According to the ruling, LLH claimed “they were subjected to discriminatory treatment from the moment they purchased the Lost Lake property and assert [the town’s] actions are motivated by discriminatory animus against Hasidic Jews.” 

In particular, they point to alleged anti-Semitic statements made by residents of Sullivan County, both at public hearings and online. 

Judge Vincent Briccetti in the ruling writes, “the court is mindful of the sensitive historical and religious context in which this case arises” but that LLH “fail to assert the alleged discriminatory treatment resulted in injuries independent of [the town’s] land use decisions.” 

Court case continues 

According to the court ruling, LLH’s remaining claims may proceed. A case management conference is scheduled for July 16.  

“The town remains committed to transparency and to preserving the integrity of its planning and zoning processes,” Supervisor Hogue said. “We will continue to represent the interests of Forestburgh residents in the ongoing state litigation and remain focused on ensuring that any development within the town complies with the law and the community’s long-term vision.”

We will continue to update this story.