COEUR d'ALENE - After further review, the agreement stands.

Mostly.

But after a closer look at the finances, Lake City Development Corp. won't be required to fund the total $404,993 in public improvements it agreed to in 2005 regarding the Sherman Lofts project.

That's because a recently-completed cost validation analysis estimates the $3 million red-bricked condominium building yields approximately $31,000 a year in gross tax increment revenue, not enough to pay the whole amount before the district expires at the end of 2021.

"Our critics say we give money up front to the developer and that's not true," said Tony Berns, LCDC executive director. "This is a perfect case and point where we haven't given anything to the developer and it's been six years."

The urban renewal agency has not started payments to the developer, 609 Sherman LLC.

A third party, usually Welch-Comer Engineers, performs a project cost validation analysis before the board agrees to start paying. The results for the Sherman Lofts study were delayed "for internal issues" within the development team, Berns said.

Now that it's done, the board could be looking at closer to $300,000 in payments though the Improvement Reimbursement Agreement before the urban renewal district expires on Dec. 31, 2021.

Developer Mike Patano, one of the principal partners in the LLC, did not return messages on Monday.

A two bedroom, two bath unit was listed at $500,000 on www.trulie.com.

The 2005 agreement promised money for public improvements with the 7-story building, listed as site improvement, demolition of the site and building, asphalt, curbs, streetscaping, building material upgrades and construction staging.

The developer fronted the cost, and the board's financial pledge included an interest rate of 5 percent, with a total IRA interest funding cap of $121,498, bringing the maximum possible amount to $526,491.

IRA agreements place the financial risk on the developer by paying them back for the public improvements from increased tax increment revenues the project itself generates after its completed. So if the project doesn't generate as much revenue as expected, the urban renewal board isn't required to pay what it agreed to.

609 Sherman LLC owns three of the 10 units, according to Kootenai County records. Other owners are Ronald Foster, Organ Pipe Properties, Christopher Patano, James Patano, Jan Romerdahl and Dennis Skrmetta.