SHINE –– The state Court of Appeals has upheld an agreement for a Hood Canal aquatic lands easement agreement between the U.S. Navy and the state Department of Natural Resources, a decision that could block a long-planned project known as “pit to pier.”

Hood Canal Sand and Gravel, the company that started collecting permits for the “pit to pier” gravel operation in 2003, filed suit in Jefferson County Superior Court in 2014 in an effort to thwart a state and federal plan to block development along the Hood Canal coastline.

Tuesday, the Court of Appeals upheld Jefferson County Superior Court’s ruling that DNR “had the authority to grant the easement to the United States Navy” and that the easement “was not arbitrary, capricious or unlawful.”

Thorndyke Resources Operation Complex, affiliated with Hood Canal Sand and Gravel, wants to build a 998-foot pier on state-owned tidelands 5 miles south of the Hood Canal Bridge to annually load onto barges some 6.75 million tons of gravel that would be transported from a quarry.

Dan Baskins, spokesman for the company, was unable to be reached for comment Wednesday or Thursday.

Joe Smillie, DNR spokesman, said he did not know whether the company planned to challenge

the decision.

“They have other appeals options, but we don’t know if they are pursuing them,” he said.

John Fabian, who heads the Hood Canal Coalition, which opposes the Thorndyke project, said the coalition is delighted with the court’s decision.

“Claim by claim and point by point, the court found Hood Canal Sand and Gravel’s case to be without merit,” he said in an email.

A previous state-approved appraisal valued the lease at $1.68 million, and the Navy isn’t authorized to purchase easements for more than $750,000.

After the Navy re-evaluated the appraisal, it offered DNR $720,000 to control 4,804 acres of Hood Canal seafloor for 50 years, according to the court decision.

The Navy reasoned that regardless of the easement, the bedlands were best used for management of the geoduck harvest and other low-intensity uses and not for the high-intensity development the easement would prohibit, according to the decision.

In its suit, Hood Canal Sand and Gravel claimed the conservation easement pact between DNR and the Navy violated the company’s rights to develop a gravel export facility in “arbitrary and capricious” ways.

The company asked the court to nullify the easement and order that the company has preserved rights to develop the property.

Commissioner of Public Lands Peter Goldmark said the easement is a “win-win for Washingtonians.

“The DNR-Navy conservation easement is fully legal and it protects critical habitat and the Navy mission.

“This is great news for the people of Washington.

“This vital agreement between the Department of Natural Resources and the Navy has been affirmed in every venue in which it has been reviewed.

“[This] decision protects a priceless marine ecosystem while ensuring public access and preserving the operations of the Navy and the many jobs that rely on its presence in Hood Canal.”

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Reporter Jesse Major can be reached at 360-385-2335, ext. 5550, or at jmajor@peninsuladailynews.com.