ST. JOHN | Saying they were backed into a corner, local officials have halted development -- for now -- in St. John's largest under-construction subdivision.

The Water and Sanitary Utility Board ordered the town no longer will allow new residential or commercial buildings in The Gates of St. John to tap into the water and sanitary systems. Because of that, building permits cannot be issued for construction there, Utility Board President Bob Myers said.

Existing buildings and those issued a building permit before Nov. 1 won't be affected. Since the decision went into effect, one request for a residential building permit has been denied, said Bob Pharazyn, St. John director of operations.

Utility Board members say The Gates developer, John Lotton, is obligated under the terms of an annexation agreement to make several infrastructure improvements, but he hasn't made good on all of them.

The agreement calls for Lotton to help pay for a water tank and construct a water treatment facility along with a trunk sewer, among other improvements for the neighborhood. The deadline for the treatment facility is this spring, and -- because it needs at least 30 weeks lead time -- it won't be done in time, Pharazyn said.

Lotton would not comment on the matter.

Lotton contributed $1.1 million, about 45 percent of the cost, toward the construction of water tank, per the agreement, Pharazyn said.

He also installed some sewer lines, Utility Board Vice President Alex Monanteras said.

But when the well was drilled in The Gates and it became clear it could pump more than twice the amount of water initially thought, the town asked Lotton to increase the size of the water treatment plant. The town, in turn, would pick up the additional cost, which is about 30 percent of the expense, Monanteras said.

After a "gentleman's agreement," the change was drafted but Lotton never responded to the documentation from the board's attorney asking for a response, Monanteras said.

Nor has he responded to letters informing him the board was considering ceasing sewer and water tap-ins in The Gates, Myers said.

Myers said he doesn't know whether court is the next step after this, but he hopes it isn't.

The Gates, bordered by 101st Avenue on the north, Cline Avenue on the east, U.S. 231 on the south an Parrish Avenue on the west, is expected to include about 1,450 housing units as well as commercial development when it is complete.

About 100 residences and four commercial developments have been built so far, Pharazyn said.