By Linda Taaffe

Future plans for the corner lot on First and Main streets in downtown Los Altos could go back to the drawing board this October if developer Roxy Rapp doesn’t seal his deal - to build a two-story boutique hotel at the site - with the city within the next six weeks.

The Los Altos City Council decided last week that Rapp would have to come back to the city by Oct. 1 with updated hotel plans and a $25,000 non-refundable deposit as a good faith effort to follow through on the project or the city could look at other options for the site.

Los Altos city officials said they have not heard from Rapp since last May, on the night when the council made its controversial decision and chose him over two other developers who submitted plans for the .78-acre, city-owned site.

Council members said they were unsure whether Rapp still considered the project economically feasible since the city required that he scale the proposed hotel down from three stories to two, provide 75 public parking spaces and work with neighboring Safeway on a possible parking expansion as a condition of approval. Rapp had offered the city $3 million for the land in order to build a three-story, 85-room hotel.

“When we voted for the hotel … Rapp’s eyebrows went way up high with surprise. Basically, that’s the last time I’ve seen or heard from him,” said Councilman John Moss. “We need some feedback on what we need to do next.”

Both the city and Rapp entered into the deal with the understanding that the property could be tied up in a lease with Nielsen’s Martinizing Dry Cleaning and Home Consignment Center until 2006. Council members said they assumed that Rapp would give them an immediate commitment so if the land were to become available sooner, he could immediately proceed with the project.

“We are nowhere close to an agreement,” Mayor King Lear said. “We have a guaranteed non agreement. This is still a council issue with major discussions.”

Lear urged the council to consider creating a downtown assessment district as an option to fund up to 300 parking stalls at the site to cover what the developer may not be able to deliver due to the proposal’s changed conditions.

Lear said the new proposal could cost the city $1 million in “out-of-pocket” expenses if it affects the developer’s economic ability to fund all of the parking stalls needed at the site. The council postponed any decisions until after the Oct. 1 deadline with Rapp.