In the borderland between Los Angeles and Ventura Counties along the Santa Clara River Valley, a regulatory barrier to a major development has been removed.

Sparring federal agencies have agreed to a plan that would allow Newhall Ranch, a sprawling housing project about 35 miles from downtown Los Angeles, to move forward. Newhall Ranch has been on and off the table for decades. Some of the investors who made risky bets on the project exited with heavy losses or bankruptcy filings.

But Los Angeles continues to grow in population and despite the housing meltdown, demand for new homes and apartments is inevitable — if you look far enough into the future. Newhall Ranch offers the promise of housing on a parcel that borders and in some cases is within the Ventura County limits.

At its best, Newhall Ranch could help fulfill the promise of the Highway 126 corridor, a physically beautiful area that includes Fillmore and Santa Paula. Those two cities could benefit from job opportunities that Newhall’s commercial and retail projects would create nearby.

According to the Los Angeles Times, an 11th hour agreement has smoothed the way for the U.S. Army Corps of Engineers and the Environmental Protection Agency to agree on a series of mitigation plans for the development.  EPA and the Corps had been at loggerheads over environmental issues, particularly how to mitigate heavy flooding in the Santa Clara River Valley, which occurred as recently as 2005.

Under the accord, Porter Canyon Creek will flow naturally, oil and gas drilling will be banned, and a land swap will take homes and commercial sites out of a potentially dangerous floodplain. If this accord sticks, Newhall Ranch still must deal with local political issues, a moribund housing market and concerns about how the lower Santa Clara River Valley and its vast agricultural resources will be protected.

It is still far behind other developments, such as Santa Paula’s East Area 1, which has moved far beyond the conceptual stage and is poised to begin construction as the housing market improves. Having a community of 60,000 gradually develop on the Los Angeles County side of the Highway 126 corridor is far preferable to forcing those homes and apartments on Ventura County, which would be hard pressed to absorb that many people given its own growth constraints.