A new 225-space parking garage for the city is one meeting away from approval.

City council voted Thursday night to approve the first reading of an ordinance authorizing a 25-year bond issue for the project through PNC Bank.

The garage is part of the Centre City project that will bring a Marriott Springhill Suites hotel and a new Rite Aid pharmacy downtown.

“I’m very excited,” said Mayor Maggie Stock. “I’m very confident this hotel will be an economic boost for the city of Butler.”

While council is moving forward with supporting the garage, it still does not know exactly how much it will cost the city.

The approved ordinance sets a cap on the bond at $6.5 million, though it is unlikely the city will ultimately borrow that much.

Instead, the “not to exceed” cap allows the city to wait until the financial details of the project are better projected.

That ordinance also will allow the city to withdraw from the bond up until signing an agreement with PNC Bank, according to Anthony Ditka, the bond council for the city who is with the Dinsmore and Shoul law firm of Pittsburgh.

Representatives from J.S. Capitol Construction, the developer of the garage along with the rest of the Centre City project, estimated last month the total price of the garage to be around $4.1 million. The estimated bond issue to cover that cost, along with refinancing part of the parking authority’s debt, would be $5.3 million to $5.8 million.

The parking authority currently is paying about $211,000 per year on two previous bonds. The city would refinance one of those bonds, leaving the authority responsible for an annual service of about $73,000.

An estimated debt service on the refinanced bond for the garage is expected to be around $286,000 per year over 25 years for the city,

The developer is waiting for more estimates from contractors before setting a solid price on the project.

“The city’s not bound to borrow the money until all the components are in place,” Ditka said.

Since the figures are not finalized, the city does not know exactly how much the parking garage will increase the city’sdebt service, though council is confident the city will be able to balance the cost with revenue from parking.

Regardless of whatever the city ultimately will have to pay, it will be relying on hotel guests using the garage to help bridge the gap.

The garage will not have designated parking zones for hotel guests, but both council and the developer are confident the time difference in which guests and the public will use the garage will prevent any problems with parking.

Night rates at the garage, the time hotel guests are expected to use it, are expected to be either $6 or $7 per night.

Assuming the hotel maintains its projected 68 percent occupancy rate, hotel guests would contribute $118,000 to $138,000 per year to the debt service.

The remaining money will be raised by the traditional daytime users of the garage. To meet the remaining gap, the city possibly will need to increase parking rates in the garage to more than the rates in the current surface lot on the block.

The current rates for parking in that 187-space lot are 50 cents per hour or $50 for a monthly permit. The parking authority estimates 60 percent of those spaces are used.

City Treasurer Jeff Smith suggested at the Nov. 25 meeting on the garage that the redevelopment authority possibly pay for part of the debt service with revenues it will earn from its 40 percent ownership in the hotel.

Art Cordwell, the director of the authority, said Thursday night that the state advised him the authority could not make long-term investments, though the authority could possibly help during specific occasions.

“It doesn’t mean if certain things come up we couldn’t go back and use some of our funds,” he said.

The final reading and enactment of the ordinance will take place at council’s Dec. 19 meeting.

Stock said she is happy the Centre City project is finally coming together.

“It’s long overdue,” she said. “In the seven years we’ve spent talking about this, I think Cranberry Township has built seven new hotels. It’s about time we get one.”

Cordwell also was pleased the city moved forward with the bond.

“It’s very exciting,” he said. “It’s a major step in getting the whole thing put together. And this project is a once in a lifetime event.”