IN THE NEVER-ENDING BATTLE OF MAN VERSUS nature, man may have won the latest bout. And his spoils come in the form of developable land in Southern Arizona.

The U.S. Fish and Wildlife Service (FWS) recently proposed to remove the Arizona-based cactus ferruginous pygmy-owl from the endangered species list. This action comes two years after the U.S. Ninth Circuit Court of Appeals ruling in NAHB vs. Norton, which found that the listing was illegal. Although the court conceded that the owls are discrete from other populations in Mexico and portions of Texas, it determined that they didn't merit federal protection as a distinct population.

Once the pygmy-owl is de-listed, many of the regulatory provisions that intended to protect the animal's habitat—a projected 1.2 million acres in Southern Arizona for about 18 known owls—should relax. And amid tight land constraints, this is good news for builders. Out of the 9,184 square miles of Pima County, in the Tucson metro area, only 75,000 acres of private land remain developable.

In the meantime, area builders must still comply with the more stringent development rules. Michael Mittlelholzer, assistant staff vice president in areas of environmental policy for the NAHB, explains, “The irony that the home builders in Southern Arizona find themselves [is that] they're having these restrictions placed upon them to protect a species that the federal government just realized was on the list illegally.”

NAHB economists estimate that with the habitat designation in effect, construction of new homes in the area would fall by roughly 262 homes per year while local governments would lose $68.3 million in tax and permit revenue.