City officials are trying to figure out the best way to pay for the new parking garage that is part of the proposed Centre City project.

Mayor Maggie Stock met with the city parking authority Thursday to discuss possible financing options for the three-tier garage.

The city is looking into options to refinance the authority’s debt to add new money through bank bonds for the parking garage.

Art Cordwell, the director of the city’s Redevelopment Authority, which is a partial owner of the hotel, said the garage is expected to cost about $3.5 million.

In the proposal, the city would take control of part or all of the parking authority’s debt and take on the additional cost of the parking garage.

Stock said the authority’s debt is to be refinanced anyway to get lower interest rates.

“The advantage to doing this is that a municipality can do it cheaper,” Mayor Stock said of taking on a bond. “The city has to guarantee any money that goes through the parking authority anyway. This would be cleaner and cheaper.”

The authority did not vote on a motion concerning refinancing, but it supported the city’s investigation into the refinancing options.

The city is exploring banking options to get the bond.

A representative from PNC Bank was at the authority meeting to explain the bond process and to speak with officials about the project.

The parking garage is expected to have 236 spaces plus some additional spaces between the garage and the hotel.

While about 90 of those spaces will be reserved for the hotel, the city hopes to work out a deal with the developer that would secure a set number of the hotel spaces be guaranteed every month to assure revenue from the garage.

The authority is $2.1 million in debt through two previous bonds, Stock said. That money is being repaid during the next 10 years.

Should the city refinance the debt, the cost of the garage would be added to either one or both of those bonds and would be paid off over 20 to 30 years.

The yearly payments would increase from $210,000 to $260,000, but would be offset by the additional parking revenue the garage would generate, Stock said.

Finding a payment method for the parking garage is the next step in the project that will bring the city a 75-room Marriott Springhill Suites hotel, the three-tier parking garage, and a retail area. Total cost of the project is expected to be about $10 million.

The mayor said the developer of the project hopes to break ground in late September or early October.

The first phase of construction would be widening Cedar Street.