Norwich – The Reid & Hughes Building on Main Street will get one last chance at revitalization.

The City Council on Monday unanimously approved a development agreement with the Women's Institute for Housing and Economic Development that calls for the organization to secure funding to stabilize the building from further decay before the end of winter and then pursue financing for a planned $6 to $7 million renovation project. The group hopes to convert the former 19th-century department store into rental apartments and retail space in the Main Street storefront.

The building has been vacant for the past 20 years, and several efforts by the city to market it for redevelopment have been unsuccessful. The council voted last fall to give up and bond $800,000 to demolish the building rather than negotiate with the Women's Institute, but the state Historic Preservation Council rejected the city's demolition request.

Loni Willey, chief operating officer for the Women's Institute, attended Monday's council meeting and thanked Mayor Deberey Hinchey and City Manager John Salomone following the meeting. Willey said Women's Institute Executive Director Betsy Crum is expected to sign the agreement with city officials Tuesday. The institute plans to immediately file an application for zoning variances needed for residential units in the rear portion of the first floor and for the overall size of the residential component.

 “This is a big step forward,” Willey said after the vote. “It's wonderful to have unanimous support.”

The agreement gives the Women's Institute 90 days to secure the estimated $400,000 to $500,000 needed to stabilize the building and 120 days to do the work. While that would put the work well into the winter months, Willey said the group would do exterior work first to “seal the envelope” and then work inside the building during the dead of winter.

The agreement then gives the group 36 months to secure major project financing.

During council discussion prior to the vote, Alderwoman Joanne Philbrick questioned the assurance the city would have that the property would be taxable once the property is conveyed to the Women's Institute, a nonprofit entity. Salomone said because the agreement does not say the project is nontaxable, it would be taxed.

“Time will tell,” Philbrick said.

After the meeting, Willey confirmed that the property would be taxable. She said certain funding sources, including tax credits, dictate that the project is subject to property taxes.

“Just because we're nonprofit doesn't mean the project is,” she said.

c.bessette@theday.com