Two local organizations have filed a lawsuit that could bring development plans for the Echo Canyon resort along the Colorado River to a halt, alleging the project lacks a valid water supply under Utah law.
On June 28, Living Rivers and Kane Creek Development Watch filed a complaint in Grand County’s Seventh Judicial District Court, arguing that the developers—formerly known as Kane Creek Preservation and Development, LLC, and now operating as Echo Canyon—have forfeited their groundwater and Colorado River water rights by failing to use them for more than seven consecutive years. Under Utah law, rights not put to “beneficial use” for that length of time are subject to forfeiture.
Read the full legal filing here.
The proposed resort, located along Kane Creek Boulevard outside of Moab, would include over 550 high-end housing units, 100 overnight accommodations, and 70,000 square feet of commercial space.
“It’s an exclusive enclave for wealthy investors that would drive up land prices, strain local infrastructure, cost local taxpayers money, and destroy the natural character of the canyon and the Colorado River floodplain,” said Laura Long, one of the organizers for Kane Creek Development Watch, in a press release.
Reports indicate that the developers began acquiring property in the Kane Creek area as early as 2017. The lawsuit contends that water rights associated with the site had already lapsed due to prolonged nonuse—making them subject to forfeiture regardless of the timing of the purchase.
What is Water Right Forfeiture?
In Utah, water rights are governed by a “use it or lose it” principle. If a water right isn’t used for irrigation or something else for seven consecutive years, it becomes subject to forfeiture under Utah Code § 73-1-4.
This applies regardless of ownership—Buying land doesn’t revive an expired right. Rights must be actively used, or protected through legal filings, to remain valid.
In some cases, water right holders can file a nonuse application with the Utah Division of Water Rights to temporarily preserve the right under certain conditions.
According to the complaint, the developers have not demonstrated any sustained beneficial use of the rights in question, nor have they filed extensions or change applications to preserve them. As a result, the plaintiffs argue, construction or even preliminary grading work should not proceed under state law.
“We need to show respect to the Colorado River and our water supplies in times of prolonged drought, water scarcity, flood events and in land use,” said John Weisheit, Colorado Riverkeeper and director of Living Rivers. “The developers of this luxury resort on the Colorado River fail to do so.”
The Echo Canyon project gained additional attention in early 2025 when it was recognized by the state as Utah’s first “preliminary municipality”—a designation that allows developers to explore limited local-government powers, such as taxing authority and land-use planning, before formal incorporation. Moab Sun News has previously reported on the project’s evolving status and legal framework.
As of press time, the developers had not released a public response to the complaint.
Read the full legal filing here
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