P&Z denies Gateway’s 42-townhouse plan

Proposal denied on 3-1 vote as developer and county remain divided over what can be built behind the Co-Op

9:26 p.m. June 2, 2026

DUANE CROSS
MCO Publisher•Editor

Gateway Development Company came back before Moore County planners Tuesday, June 2, with a revised housing plan for the 5.132-acre tract behind the Moore County Co-Op.

It ran into the same wall.

The Planning and Zoning Commission denied Gateway’s site plan for 42 townhouses, with the majority saying 42 homes on the tract do not fit their reading of the county’s zoning ordinance.

Gateway will now take its case to the Board of Zoning Appeals.

Chairman Dexter Golden and commissioners Scott Fruehauf and Jim Crawford voted against the plan. Bobby Carroll voted in favor. Jeff Ross abstained. Jimmy Hammond and Angelica Lightfoot were absent.

Gateway representatives argued the townhouses are not apartments and should be allowed under the ordinance. Commissioners who opposed the plan said it still places too many dwelling units on a single tract and resembles the company’s earlier apartment proposal, which is in litigation.

“This looks very similar to the apartment layout,” Golden said during the discussion. “And it’s a density issue.”

Without an approved site plan, Gateway cannot proceed with other permits required for the townhouse project.

Gateway says townhouses fit the ordinance

Gateway originally proposed a 44-unit apartment development on the property, a plan the company says it pursued in reliance on a zoning letter from the county. That project later became the subject of a lawsuit after the county changed its zoning language and maintained that apartments were no longer allowed on the tract.

The lawsuit is specific to the apartment proposal. Tuesday night’s vote involved Gateway’s revised plan for 42 townhouses.

Under this plan, Gateway proposed attached townhouses, with each unit containing its own dwelling space and separated by required firewalls. Attorney Madison Haynes, speaking for Gateway, said each townhouse should be treated as an individual building with a single dwelling unit.

Gateway’s reading of the ordinance is that townhouses may be attached in a series of three or more principal buildings, and each proposed unit would be one building containing one home.

Commission members read the same ordinance differently.

Golden said the ordinance limits the number of dwelling units allowed on a zoned lot. Because Gateway’s 42 townhouses would sit on one 5.132-acre tract, he said the plan amounts to a multifamily development with more homes than the zoning district allows.

That left Gateway representatives asking what type of housing development the commission believes can be built on the property.

“If that’s going to be the issue and that’s what we’re going to aim this whole thing on, then what can we build?” Haynes asked. “What is permitted under your definition of townhomes?”

Commission members discussed how lot-size requirements might limit the number of homes allowed on the property. At different points, the conversation touched on townhouses, duplexes, and apartments under another zoning district, but no clear alternative emerged that Gateway could take away and redraw.

Apartment fight remains in the background

Gateway representatives said the company relied on the county’s zoning letter when it began work on the apartment development and pursued state tax-credit financing. The company maintains the rules changed after Gateway had already relied on the county’s earlier position.

“It’s an unfortunate set of circumstances that you can get a zoning letter and have to rely on it to third parties and the state government and then have the zoning change,” Haynes said.

Commission members responded that the zoning change was voted on and adopted through the county’s process.

Gateway returned with townhouses as a different path forward for the property. Tuesday night’s vote showed the underlying fight has not changed: Gateway says the ordinance allows its 42-unit layout; a majority of commissioners said it does not.

Highway entrance raises separate concern

The zoning dispute was the stated reason for the denial, but it was not the only concern raised Tuesday night.

Commission members also questioned whether the proposed entrance to the development could safely handle traffic from 42 townhouses. The entrance would connect the property to the state highway across from Woodards on Main Street.

Gateway representatives said the entrance meets Tennessee Department of Transportation spacing requirements and that the company intended to seek approval for a full-access entrance that would allow vehicles to turn both left and right into and out of the development.

Golden said he worried that a limited right-in, right-out entrance could push traffic toward Lynchburg and create problems in an area already carrying a steady flow of vehicles.

Gateway representatives pushed back on the traffic discussion, noting that a traffic study is not required under the zoning ordinance and that the highway falls under TDOT jurisdiction.

Golden said the entrance question needed to be raised, but made clear it was not the basis for denying the site plan.

“The reason you’re getting turned down [Tuesday night] would be the disagreement on the definition of the townhome,” he said.

No approved path forward

The tract behind the Co-Op has now been through two housing proposals: apartments first, then townhouses.

Gateway has argued that Moore County needs the housing and that its plans comply with the rules the company relied on when it began pursuing the property. The company has also pointed to Moore County’s identification by the Tennessee Housing Development Agency as an area with an affordable housing need.

The majority voting Tuesday night said Gateway’s 42-townhouse plan does not fit the ordinance governing the property.

For now, the land remains undeveloped: one apartment proposal in court, one townhouse plan denied, and no approved path forward for housing on the property.