UPDATE: The Reno City Council has voted to move forward with the Daybreak development.

The motion was passed 4 - 3 with Schieve, Brekhus, and Duerr voting against it.

The City of Reno says they moved to review the Daybreak project for later this month.

They moved to direct staff to meet with the developers and report back to the Council on September 23. The City of Reno City Council approved the motion 4-3.

They said the if the City denies the project on that date, the parties report back to the judge and oral argument on the City's motion to dismiss goes forward on September 27. The litigation will continue.

They said if the City tentatively approves the project on the 23, the parties report back to the judge and oral argument is canceled. The litigation will be suspended pending the City Council's final approval at a subsequent meeting. From there, the lawsuit would be dismissed.

The City of Reno said if the City Council needs more time to review the materials on the 23, and if the developer is willing to give the City Council more time to consider the modified project, the parties will report back to the judge and request to reschedule oral argument. They said if the judge grants the request, the Council will have more time to consider the modified project. If the project is approved from there, oral argument will still be canceled and the lawsuit dismissed.

The City of Reno said if the judge does not grant the request, oral argument will be heard on September 27 still and the litigation will continue.

This is a developing story.

Original Story: The developers of the proposed Daybreak community are suing the City of Reno for damages it says cost more than $50 million. The lawsuit comes nearly three months after the city council denied Newport Pacific Land Company from moving forward with its housing plan. It says it had worked in good faith with the city, spending money to acquire land, prepare applications and complete studies. The company says it will also lose $100 million in lost revenue because of the decision.

The city council voted 6-1, in November, keeping the project from moving forward. It said the development did not meet the criteria for the city's master plan, known as Reimagine Reno. Their biggest is that a lot of the land is in a flood plain. 

Daybreak Reno would include the construction of 4,700 homes on 980 acres of what used to be the Butler and Bella Vista Ranches near Rattlesnake Mountain, along Veterans Parkway. It would also include parks, schools, and commercial space. Project planners say the plan would reduce the risk of flooding. They say they would provide 125 percent of the mitigation.

In the Petition for Judicial Review and Complaint for Damages, NPLC says the city ignored staff and the Planning Commission's findings, which supported the project. It also says Reimagine Reno does not pertain to Daybreak Reno because it submitted the application under the previous master plan. It argues that the plan is not binding either.

"In short, the City arbitrarily denied Daybreak's applications based solely on politics, ignoring the facts, law, and uncontroverted, substantial engineering and technical information in the record which mandated approval," the petition said. "The City's actions were arbitrary and capricious, unlawful and in excess of lawful authority, unsupported by substantial evidence, discriminatory, and unconstitutional, and must be reversed."

NPLC says its plan would provide needed housing for people who earn the median income, helping to alleviate issues relating to the housing shortage. It is also an infill project, which it thinks is a better alternative than continued sprawl.

Along with damages, the lawsuit is asking for reasonable attorney fees and costs, its requested declaratory relief, an order reversing the city council's denial of Daybreak's applications, and other relief that the court deems necessary and appropriate.