SALEM — The developers behind plans for a self-styled eco-friendly destination resort in the Metolius River Basin learned Tuesday that if the state can find them a location for their resort elsewhere, they will have the rights to build only two homes in the basin.

The unexpected turn of events surfaced Tuesday when the state Land Conservation and Development Commission recommended a Metolius River Basin management plan that now goes to the Legislature for approval.

The recommended plan capped off three months of intense closed-door negotiations and public hearings. It filled in the blanks on a proposal initiated by Gov. Ted Kulongoski in December to ban destination resorts from the basin while giving it special protection as an “area of critical statewide concern.”

The LCDC plan would give the Metolian increased development rights over the land’s current zoning, but with a big “if” attached.

Specifically, it would grant the right to build 25 homes as well as 10 overnight dwellings on 25 acres — but not if the Legislature enacts a bill that provides for the Metolian developers to build a “sustainable eco-community” outside the basin.

If that occurs, the developers will go back to being able to build only two dwellings inside the Metolius basin.

Shane Lundgren, a member of the investment group Dutch Pacific Resources LLC, said his group had previously agreed that the state’s offer of 35 homes was doable for them, considering the state of the economy and the need to get the development done in a timely fashion.

But after the meeting Tuesday, he said that a failure to recoup anything on the group’s investment in developing plans for the Metolian would jeopardize any attempt to tackle a whole new eco-resort idea. He said he was taken aback at the last-minute amendment to the draft plan.

“We’ve got a property that we’ve got to monetize,” he said. “We can’t just walk away from what we already have.”

Rep. Brian Clem, D-Salem, said he had suggested the LCDC plan be modified. He argued that the Metolian should not receive significantly increased development rights based on speculation that its land would be successfully remapped with the right to build a destination resort.

Though approved by Jefferson County, the remapping for resort purposes of the Metolius basin has been appealed and is currently awaiting action in the Oregon Supreme Court.

Clem has influence over the issue because in the state House, he and Rep. Ben Cannon, D-Portland, are being viewed as essentially playmakers on the destination resort issue. Clem is viewed as a moderate Democrat while Cannon is prominent among the more liberal Portland caucus. The two are co-sponsoring legislation that would allow lawmakers to reshape the LCDC recommendation.

Clem said he is also working on “eco-community” legislation that has not yet been introduced. Clem said several timber companies are interested in the idea of an environmentally friendly resort. One is Plum Creek Timber, which owns land near Bandon Dunes. Another is Fidelity, which owns land near Gilchrist.

Matching up those landowners with Lundgren’s group “could work out well,” Clem said.

Ponderosa

The plan also affected Ponderosa Land and Cattle Co., developer of the other destination resort that had been discussed for the Metolius basin area. Under the plan, Ponderosa would be limited to 100 permanent homes and 20 overnight dwellings on 320 acres of land.

Richard Whitman, director of the state’s Department of Land Conservation and Development, said that under the property’s forest zoning, Ponderosa would have been able to build roughly 120 homes on 10,000 acres. Consolidating those development rights on a smaller piece of property as the plan calls for would help wildlife, he said.

Rick Allen, lobbyist for the Ponderosa, said his employer will abide by the plan.

“I think it’s going to be first-class. I think people are going to like what we do down the road,” he said.

Of the LCDC proposal, he said, “This should be an easy one. Everyone should be able to get on board, move forward and feel proud of what they’ve got.”

Jonathan Manton, lobbyist for Central Oregon Landwatch, said his group appreciated the efforts of the LCDC and its staff to achieve a compromise that still protected the basin. However, he said he felt some of the details of the plan amounted to loopholes that the group would highlight for lawmakers as the basin protection plan moves forward.

The plan now goes to lawmakers to approve or modify, perhaps using the legislation sponsored by Clem and Cannon. But no hearings there have yet been scheduled.