Photo by Miki J.

A day after public officials put shovels to the ground for a ceremonial groundbreaking at the McMillan Sand Filtration Site, the D.C. Court of Appeals has issued a decision that throws a new wrench in the complicated saga of the $720 million development.

The court vacated orders from the Zoning Commission and Mayor’s Agent for Historic Preservation that cleared the way for project to begin, a major setback for the mayor’s office, which spent much of yesterday touting the development. While waiting for the court to rule on the issue, the groundbreaking kicked off historic preservation work.

“I am absolutely ecstatic,” says Kirby Vining, treasurer of Friends of McMillan Park, which filed the lawsuit. “The court is the first time that we’ve had an objective look at what the city is actually doing with this land.”

But as far as the mayor’s office is concerned, the matter is far from over. “The District believes the issues outlined by the courts will be addressed so work can continue on this transformative project,” said Joaquin McPeek, spokesperson for the Office of the Deputy Mayor for Planning and Economic Development in a statement.

Part of the court’s decision details how the Zoning Commission failed to address how the development would impact the surrounding neighborhood, including use of utilities, property values, and displacement.

A proposed project on a historic landmark like McMillan, which sits on the National Register of Historic Places, must have “special merit” to justify demolition or the subdivision of the property’s 25 acres to include 146 townhouses, more than 500 apartments, retail, a Harris Teeter, a park, and a community center. The court says that the Mayor’s Agent for Historic Preservation has yet to adequately explain how this particular project fits that bill.

The court doesn’t entirely agree with Friends of McMillan Park, however. The decision argues, contra FOMP, that high-density development on the property could be justified in some cases, like if it were “the only feasible way to retain a substantial part of the property as open space and make the site usable for recreational purposes.”

The Coalition for Smarter Growth called the ruling a “disappointing setback [that] delays much-needed housing and affordable housing, a new grocery store, and the historic restoration of aging structures” in a statement.

The proposed development has long had an active opposition calling for more preservation on the property, which has sat unused since the 1980s. They scored a victory when the D.C. Auditor called the 2007 bidding process “flawed“, recommending the city put the project out to bid again in a report issued last year.

According to the mayor’s office, the project has been “thoroughly vetted since then, including council review,” McPeek said on Tuesday. They say the development will lead to 3,000 construction jobs, 3,200 permanent jobs, and more than $1.2 billion in tax revenues over the next 30 years.

“What an embarrassment for the mayor—one day after the groundbreaking and this happens,” says Vining. “We’ll obviously be having a celebration of some sort, but what is the city going to do next? We don’t know that, but everything hinges on it. But step one for us was to stop the train, and step one is apparently done.”

The mayor’s office is working to get the train up and running, though. “Ward 5 residents have waited nearly 30 years to see McMillan reach its full potential – they shouldn’t have to wait any longer,” McPeek said in a statement. “We will work with urgency to ensure it delivers the jobs, housing, retail, and open space this community has continued to ask for.”

On Friday, developer Vision McMillan Partners released a statement that said, “We are disappointed with some aspects of the Court’s ruling for the McMillan site, yet significantly encouraged by its agreement with the Zoning Commission that our project is consistent with the District’s Comprehensive Plan and the Future Land Use Map.”

This story has been updated.