A hotel planned for the site of the former Palace Theater and Odyssey’s Night Club will be delayed by more than a year after analyses of the location found debris left in the soil and naturally occurring selenium and silver.

The issues prompted the city's Redevelopment Authority to amend agreements with Superior Hotel LLC to extend deadlines for the property's sale and the construction timeline for the proposed 60-room Cobblestone Hotel and Suites. Construction was originally slated to start during the summer of 2019 and be completed at the end of 2020.

Delays have pushed the start of construction to September, said Jason Serck, economic development, port and planning director. The hotel is expected to be finished near the end of 2021 or early in 2022.

The Redevelopment Authority also approved an additional $200,000 tax-increment grant so the company can make necessary soil corrections and site improvements for construction of the hotel. The authority previously approved $1.2 million in incentives toward the estimated $8 million project. Their action brings to total incentive package to $1.4 million.

“There’s still some rubble and remnants of the old buildings that’s there. That is essentially why the request for some additional dollars from our tax increment financing plan," Serck said.

For projects like this, Serck said a phase one environmental review is required. The review turned into a bigger issue when officials discovered there had been a laundry on the site in the 1930s, which required a test dig in the area. While officials found nothing related to the laundry, Serck said they found naturally occurring selenium and silver.

The state Department of Natural Resources determined there was nothing that needed to be done concerning the elements, but Serck said it set the project back a few months.

The delay prompted Mayor Jim Paine to question if there is a way the Redevelopment Authority could get environmental assessments in advance of future projects to spur development.

“My guess is if it happened on this site, it’s going to happen on every similar site,” he said.

Commissioner Doug Finn said he would have expected better clean-up of the demolition site because the Palace Theater and Odyssey Night Club were demolished fairly recently. The buildings were razed in 2006.

“It happens quite often where these sites have not been cleaned up,” Finn said. “It seems to me there should be some requirements. You shouldn’t always have these problems. I understand something that happened 30, 40, 50 years ago, but this is a more recent demolition.”

Serck said a similar issue occurred on the site of the former Central School, where construction is underway on the Central Flats mixed-use project. The city now requires that foundations be removed when a building is demolished.

Commissioner Ann Porter of LHB said testing doesn't always uncover everything at a site. She pointed to the new Cooper Elementary School as an example. Despite the site having undergone soil- and geo-testing, digging later revealed rubble and debris from the original school, she said.

“You’re not going to be able to test every square inch,” Porter said.