Rolling Glen Subdivision stalled amid lawsuits

By JESSICA MAYRER Chronicle Staff Writer

Steve and Susie Cavanaugh’s vision of a sprawling 1,724-acre development complete with two golf courses and a Starbucks was slated to be the largest subdivision in Montana.

But now, years after gaining preliminary approval, their plan to build 2,599 homes and condos north of Three Forks, ultimately changing the complexion of that rural community, may not come to be.

Rolling Glen Ranch is stalled amid legal battles between Broadwater County, the Cavanaughs and subdivision investors.

In May, Broadwater County sued the Cavanaughs, Rolling Glen Ranch and eight other defendants, alleging the developers did not abide by an agreement to improve or pay for road construction around the project.

The county maintains the defendants owe $258,399 for road improvements, a precondition for gaining the county’s approval to subdivide.

“There was supposed to have been compensation by Mr. Cavanaugh,” said Gail Vennes, chairman of the Broadwater County Commission. “He did not make that payment.”

So, in February, commissioners rescinded their approval of the Rolling Glen Ranch subdivision and barred Rolling Glen from selling, transferring or conveying lots or homes without the county’s approval.

After commissioners froze the subdivision, the Cavanaughs filed a lawsuit claiming the county misrepresented itself during negotiations over who would pay for road improvements.

Broadwater County commissioners and employees assured the Cavanaughs that other developers would help foot the bill, the developers’ lawsuit maintained, and that’s why they were willing to sign the road improvement agreement.

The Cavanaughs also contend they were not given adequate notice before the public meeting at which commissioners put a hold on lot sales and declared the preliminary plat null and void.

“That’s nonsense,” Thomas Budewitz, the county’s attorney, told the Chronicle. “He refused to come to the meeting.”

In June, Steve Cavanaugh and Rolling Glen Ranch filed a countersuit against Broadwater County that also named and Donald J. Dixon, owner of Mountain Vista Estates subdivision, as a defendant. That suit claims Dixon’s neighboring development should have been held responsible for a portion of the road-improvement costs.

Steven Cavanaugh and his attorney “Fritz” Gillespie declined to comment.

“I don’t try my cases in the media,” Gillespie said. “The theories and the things we do will come out in the pleading we filed with the court.”

Further complicating the matter are ongoing disputes between the Cavanaughs and several lenders who were given subdivision lots as collateral.

Three lenders listed as codefendants in the county’s suit filed in May, have also filed foreclosure proceedings against the Cavanaughs and another may be forthcoming, according to Budewitz.

“They were paying monthly and then they stopped,” said Donald Neu, one investor who filed foreclosure proceedings against the Cavanaughs.

However, while sale of foreclosed property is slated to begin at the end of August, Budewitz said, “I’m asking for an injunction to block these foreclosures.”

If lenders are allowed to foreclose and sell the properties without ironing out the problems over the road improvements, Broadwater County will lose the ability to recuperate any road-improvement expenses, according to the lawsuit.

If that happens, “either the landowners within the subdivision will be without improved roads or the taxpayers of Broadwater County will be required to pay the costs,” according to the suit.

The Cavanaughs are also tangled in tax bills.

According to Broadwater County’s treasurer, Rhonda Nelson, Rolling Glen Ranch is delinquent on about $3,000 in property taxes from 2007.

If the outstanding taxes are not paid by July 16, “then we sell at auction to the highest bidder,” Vennes said.

Jessica Mayrer can be reached at 582-2635 or jmayrer@dailychronicle.com

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