(CN) - Noting the expected creation of hundreds of local jobs, the 9th Circuit changed course on an Alaskan railroad project that it had previously faulted on environmental concerns.
The federal Surface Transportation Board approved the 32-mile rail project in 2011, but it met with opposition from the Sierra Club, Cook Inletkeeper and Alaska Survival.
Boosters say that the project will increase international traffic at Port MacKenzie, in southcentral Alaska, and help develop the area economically. The line aims to connect the port with a rail line near Houston, Alaska.
But environmental groups warn that the project will "cause irreparable damage to the untrammeled wildlife habitat and wetlands ecosystems that make up the Lower Susitna Valley," according to court filings.
The federal appeals court in San Francisco halted the project in October over such concerns. Since that time, local voters approved additional funding for the extension, and the appellate panel heard oral arguments on the issue from both sides.
In a brief order Wednesday, the court lifted its stay and decline to review the board's previous ruling.
"The balance of hardships no longer tips sharply in the petitioners' favor," the order stated. "Further delay of this project will prevent the award of construction contracts, postpone the hiring of construction employees, and significantly increase costs. Because this project is funded largely with taxpayer dollars, these increased costs of construction, which the respondents-intervenors in moving to lift the stay estimated at $10-12 million, will burden the public upon continued delay. By contrast, the weight to be given petitioners' assertions of hardship because of environmental harm is weakened by this court's decision to deny the petition for review, which will allow the project to move forward."
An "opinion on the merits of denial of the petition for review will follow in due course," according to the order.
The environmental groups have also sued the Army Corps of Engineers in a separate action related to the project. They seek judicial review of a Clean Water Act permit issued by the corps that allows contractors on the project to dump fill material into waterways and wetlands.