The agreement, announced Tuesday by Palisades Tahoe, Sierra Watch, and the League to Save Lake Tahoe, ends a long-running lawsuit over the proposed expansion project.
The original project called for 850 hotel, condo, and timeshare units, 300,000 square feet of commercial space, and an indoor water park. But environmental groups argued it would bring heavy traffic, worsen wildfire risk, pollute Lake Tahoe, and urbanize the scenic mountain area.
Under the settlement, the number of bedrooms in the project will be reduced by 40 percent. Commercial space in the village area will be cut by 20 percent, and plans for the indoor water park have been dropped entirely.
One of the most significant terms of the agreement permanently protects the land at the base of Shirley Canyon, a popular hiking area, from any future development.
Community meetings on the revised plans are expected to take place in the coming months. Placer County's Board of Supervisors must still approve the project before construction can begin.
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