Regardless of whether Strathmore pays before the expiration date, the future for the project is uncertain, but not lost. It has many paths, but few that end the financial struggles that have plagued the $116.4 million mixed-use development.

Foggy future

East Lansing Mayor Vic Loomis said there are many different scenarios and components playing into what potentially could happen to the project, which contains seven properties and is bordered by Grand River and Evergreen avenues and Abbot Road.

“You’re trying to predict the future, and that’s hard to do because we don’t know for a fact what the developer may or may not do,” he said.

If the site plan expires in December, Strathmore must go back through the process of getting it approved. Loomis said the council can vote on the issue with the delinquent taxes pending; however, it could affect the outcome of the council’s vote and would mean the project couldn’t physically move forward.

“We can vote on it at any time,” he said. “The question is what the outcome of the vote would be.”

Director of Planning and Community Development Tim Dempsey said the process for City Center II took almost 50 meetings to review the project.

After the developer submits a special-use permit, the project is circulated throughout various boards and commissions, which could take months, East Lansing Planning and Zoning Administrator Darcy Schmitt wrote in an e-mail.

Once it’s reviewed by each board and commission and has a public hearing through the East Lansing Planning Commission, commissioners would advise Strathmore of any issues that need further study.

Eventually, the request will fall in the hands of City Council, where a public hearing will be held and the council then can take action on the application.

“The process … is required by (the) city code and is used as the minimum standard of review,” Schmitt wrote.

“Each proposed project regardless of size has been unique as far as length of review process.”

As for the still nonrenewed development agreement, Loomis said the City Council would not vote on the issue until all summer taxes were paid.

Come to collect

Strathmore currently owes about $129,000 for summer 2009 taxes in East Lansing. The taxes the developer owes were levied July 1 and were not paid before Aug. 31. Because they were not paid by then, there is a one-time, 3 percent late fee added to the balance, East Lansing Treasurer Jill Martinez said. If the taxes aren’t paid by the end of February, they will roll over to the county for collection, Martinez added.

The outstanding balance owed to the city is paid by the county. Personal property taxes, which include things such as equipment and furniture being used by a business, still are pursued by the city.

The county is no stranger to Strathmore’s struggles. The company owes about $130,000 in back taxes for 2008 to the county. These are separate from the city’s taxes and must be paid within 25 months before the county files for a tax foreclosure on City Center II’s properties, Ingham County Treasurer Eric Schertzing said.

Additionally, Dec. 1, winter taxes will be levied on City Center II and are payable through Feb. 14. The same 3 percent late fee would apply to those taxes if they are not paid by Feb. 14. If the December taxes go unpaid, just like the others, they also will be taken up by the county.

The options

Chappelle said the company is working through the financing process and remains optimistic the project will move forward.

Dempsey said he also is confident the financing will come through, citing almost daily conversations with Huntington Bank, which is financing Strathmore.

With the development agreement stalled, Dempsey said the developer can choose how to proceed with the site plan. The developer can continue with the current plan or make any changes to the plan by going through the process all over again.

Chappelle said a business has expressed interest in occupying potential office space, which would replace some of the residential space.

But, if the funding does not come through, Dempsey said Strathmore ultimately owns the properties.

“From that respect, we would not see another developer step forward because they wouldn’t have control of the property,” Dempsey said.

Regardless of what happens, Dempsey said the city is committed to redeveloping that area of town. If Strathmore were to lose the properties, the city would be interested in finding other options to develop.

“If we got to the point where the current developer couldn’t proceed, we would certainly look to somebody else to move a project forward there, under a worst case scenario.”