ESCANABA — The construction of a hotel on the site of the former Super One Foods grocery store moved forward Tuesday when the Escanaba Brownfield Redevelopment Authority approved a plan for the project. The plan will now be sent to the city council for final approval.

The property was designated a brownfield last April after the authority narrowly approved considering the former grocery store “blighted” under the Brownfield Redevelopment Act, Public Act 381. The act specifies properties can be considered blighted and eligible for brownfield designation if the property “has had the utilities, plumbing, heating, or sewage permanently disconnected, destroyed, removed or rendered ineffective so that the property is unfit for intended use.” The sewer was capped by Dial Companies, which owns the property, in an effort to make the site fit the designation.

Having a property designated as a brownfield opens developers up to a number of tax incentives and grants to bring a development to fruition. However, for the authority, the key issue is the property’s access to tax incremental financing (TIF) reimbursements. In the case of brownfield sites, this means the difference between a property’s taxable amount at the time it was designated a brownfield and the value of the property once it has been developed can be captured by the authority for a set period of time and returned to the developer to pay for specific eligible expenses that are included in a plan approved by the authority and the city council.

The plan submitted Tuesday, which is commonly known as a “381 Plan,” specifies the developers intend to demolish the Super One building and construct an 80 room motel, tentatively a Hampton Inn. Large portions of the parking lot will be removed and reconfigured to include a 5,400 square-foot restaurant near the former Staples building and a 1,950 square-foot restaurant near the Auto Zone and Advanced Auto Parts stores.

Currently, the property is valued at $1,004,441, and the estimated property value after the improvements is $1,645,000. The plan includes $477,650 of Michigan Strategic Fund Eligible Activities, which, if approved by the city council, would be reimbursed over a period of 15 years.

“If the valuation comes in higher, then that capture would be for a shorter duration, and if it came in lower, then it would extend a few years,” said City Assessor James McNeil.

Included in the plan are $180,000 for building demolition; $211,000 for lead, asbestos, and mold abatement; $10,000 for site preparation; $5,000 for plan preparation; $10,000 for engineering, surveying, and design; and a $61,650 (15 percent) contingency.

While the 381 Plan was unanimously approved by the Brownfield Authority members present at Tuesday’s meeting, the authority was quick to note this is not the final step in the process and the final site design would ultimately be put to the Escanaba Planning Commission after the 381 Plan was approved, in full or in part, by the council.

“Once the brownfield plan is approved by council, then it goes through normal planning vetting,” said Brownfield Redevelopment Authority Member Joseph Kaplan.

It was also noted during the meeting that, while the value of neighboring properties would likely increase as a result of the development, the taxable value for those properties would not change unless they were improved upon by their owners, as the current taxable value is capped by law.