A Hanoverian horse grazes in the field at a farm owned by Betsy Smith, a pediatric HIV researcher, in New Market, Md., on Aug. 21. (Nikki Kahn/The Washington Post)

The Eugene B. Casey Foundation is a mainstay of Washington-area philanthropy, awarding millions of dollars to recipients including the Washington National Opera, Suburban Hospital and the Duke Ellington School of the Arts.

But horse farm owner Betsy Smith and her neighbors say the foundation has been anything but charitable in its approach to land that it owns in southeast Frederick County, just past the Montgomery County line.

The foundation received final approval last week from the Board of County Commissioners for a rezoning that will enable it to sell 634 acres to a developer for construction of more than 1,000 homes and townhomes in the New Market area. The foundation says it will use proceeds from the eventual sale to continue to fund its philanthropic work.

Opponents of the plans say such heavy residential construction will negatively impact the still largely rural area, especially the cleanliness of nearby Lake Linganore, a major water source. Critics also say the foundation has acted vindictively toward Smith, whose horse farm is surrounded by the Casey land, by proposing to cut off her access to the area’s main road and, until recently, refusing to commit to a buffer zone to shield the farm from the residential construction.

Smith’s attorney, Michelle Rosenfeld, says the foundation was trying to “put [Smith] out of business, so they can get the land.”

Casey officials say they harbor no ill will toward Smith and will work to accommodate all of the landowners adjacent to the foundation property while still exercising the foundation’s legal development rights.

The tension began building after Smith declined an offer from Casey to join in its application for rezoning, a collaboration that, Smith says, could have led to her 35-acre farm being sold along with the Casey land so that more houses could be built.

The foundation subsequently submitted road plans that would cut off Smith’s direct access to Route 75, the area’s main road.

Until the Board of County Commissioners intervened, Casey also refused to provide Smith’s property with an undeveloped buffer zone to shield the farm from residential construction — a commitment the foundation made earlier to other adjoining property owners.

A few weeks ago, a Casey representative came onto Smith’s property without permission and photographed runoff that contained horse manure. The foundation submitted the photos at a hearing to buttress arguments that Smith’s farm, which has 17 horses, two coon hounds and a cat — posed a greater threat to the Linganore watershed than the 1,000-plus home project.

Smith called the unauthorized entrance “creepy.”

“I think they were giving me the message that it was going to be very unpleasant to have a horse farm there in the future,” says Smith, a pediatric AIDS researcher at the National Institutes of Health who is also active in Cleanwater Linganore, a group trying to raise awareness of threats to the watershed posed by aggressive development.

Betsy Smith, a pediatric HIV researcher, halters a horse at her farm in New Market, Md., on Aug. 21. (Nikki Kahn/The Washington Post)

“Absolutely not,” Casey’s chief financial officer, Donna Sheehan, says, dismissing the charges as baseless. Officials say the foundation had accessed Smith’s property in the past, without issue.

Robert Dalrymple, Casey’s attorney in the rezoning, says Smith’s decision not to partner with the foundation had no bearing on the actions that the foundation took.

“We just wanted to give her the chance. We were just trying to be good neighbors,” he says, calling Smith’s property “the hole in the doughnut.”

Smith and her late husband, a Johns Hopkins radiologist, outbid the foundation for the land in a 1990 auction. They were smitten with the old farm and, Smith says, only vaguely aware that the surrounding acreage could one day give way to subdivisions.

For years, development wasn’t an issue. A soft economy kept the land vacant, and in 2008, a “slow-growth” majority of county commissioners voted to revise zoning on the Casey parcel, restricting it to agricultural use.

But in 2010, the political pendulum swung the other way. A new, all-Republican board of commissioners invited property owners whose zoning had been changed to reapply for zoning that would allow more density. In a series of votes, the board gave the green light to zoning that could create more than 8,200 new homes in the New Market area, including a town center in Monrovia.

The change sparked criticism, including from county Commissioner David Gray, who called the shift “a tragedy.” But Commissioner Blaine Young, who is running in November to become Frederick’s first county executive as it transitions to a charter form of government, says New Market is where growth should be occurring.

“Thirty years from now,” Young says, “I know we will have served the county well.”

The Casey Foundation’s wealth — with total assets of nearly $170 million, according to its latest IRS filing — is rooted in real estate.

Eugene B. Casey, who died in 1986, was one of upper Montgomery’s biggest landowners. The foundation is run by his widow, Betty Brown Casey, now 87, who is listed in tax documents as the sole trustee. The organization is notoriously press-shy, and Betty Casey did not return a call seeking comment.

New Market-area residents say they wondered why a foundation with such wealth needed to sell the land in Frederick to developers.

“I find it unbelievable,” says Steve Quarles, a horse farm owner in nearby Mount Airy. He sarcastically characterized Casey’s approach as: “We do our good works elsewhere, and we have our revenue sources in a distant county.”

Casey has yet to select a developer to buy the land. And with other regulatory matters still to be worked out, it could be years before a shovel actually goes into the ground.

Smith, who could appeal the zoning board’s decision in court, says she hopes Casey will reconsider at some point and decide to use the land differently— perhaps as a nature preserve.

“We thought,” Smith says, “that she might have a soft spot in her heart for this area.”