DANVILLE -- SummerHill Homes received final approval Tuesday from Danville to build a 69-home development off Diablo Road, but opponents aren't ready to throw in the towel yet, and threaten legal action to halt the project.

The city ordinance will allow construction of 66 single-family homes on the east side of the Magee Ranch property, and three larger lots and homes on the west side off McCauley Road. The homes would be clustered on 38 acres of the 410-acre property, leaving 372 acres as open space. The project has been opposed over the last two years by citizen groups who say the new homes will worsen traffic in an already congested area, and threaten the safety of cyclists who take the narrow Diablo Road to get to Mount Diablo State Park.

Council members approved the project after a marathon six-hour meeting on June 18, saying it complied with all local requirements, including Measure S, the town's open space initiative.

"They met our high standards," Danville mayor Newell Arnerich said Wednesday. "While somebody may want a different outcome, we have to follow the law. We got a smaller project that protected the most amount of open space."

Members of the citizen group Save Open Space (SOS) Danville said the council's approval ignored Measure S by not putting the decision in voters' hands. Danville's general plan, they say, doesn't allow clusters of homes to be built on agricultural land, requiring a zoning change and a public vote under the initiative.

Todd Gary, a member of SOS Danville's steering committee, said his group hopes to raise $40,000 to $60,000 from residents over the next two or three weeks to challenge the project in court.

"We're extremely disappointed that the town council approved the project," he said. "It circumvents the vote of the public on Measure S ... They say it doesn't trigger Measure S because we're not changing the land uses; that's the illegal part of the plan."

Gary said contributions to the legal fund will be returned if the group doesn't reach its goal.

"There's been a tremendous amount of outrage and support for a challenge," Gary said.

Stuart Flashman, the attorney representing SOS Danville, said he believes he has a strong case based on a "lack of compliance" with the California Environmental Quality Act, inadequate attention to traffic and cyclist safety issues, and a zoning change that should've been applied. An appeal would have to be filed by Aug. 1, Flashman said.

"(The town) has come up with some complicated, and frankly, Byzantine ways of saying they don't need to change the land use designation," Flashman said.

Town officials have said SummerHill didn't trigger components of Measure S because the density of homes falls below the limits for the land's zoning.

"Measure S is a solid, legally-tested standard which the voters approved," Arnerich said. "... There are people who believe it should be used for every project, and it's simply not true."

SummerHill Housing Group's president and CEO Robert Freed said he is waiting to see if a challenge materializes, and is confident that if one does, the developer and town would prevail.

"We certainly looked at the body of Measure S when we started on this path," Freed said. "The town looked at it; the legal staff looked at it. It's not applicable."

Contact Jeremy Thomas at 925-847-2184. Follow him at Twitter.com/jet_bang.