The old Port Byron Hotel is once again in limbo after a village board turned down a proposal that the building's owner said could have generated income to be used toward further restoration.

Gary Cole, current owner and developer of the property, tried to get a zoning variance to convert part of it into apartments, but he was unanimously turned down by the village's Zoning Board of Appeals.

“With that income, in a few years I might be able to work on the front,” Cole said.

He ran up against the village ordinance prohibiting residential properties on the first floor in a commercial district, but had hoped the ZBA would allow the variance.

“There was nothing else I could do,” he said.

Meanwhile, grant money that Cole could have used earlier had he been able to raise enough private investment will disappear when the grant expires Dec. 31.

Ron Wilson, mayor of Port Byron, and Cole were the only people attending a special public hearing on Nov. 25 on Cole's plan .

Wilson spoke out against the apartment proposal. He said the village board objected to that use because of its potential effect on downtown, such as occupants putting couches and other furniture out on sidewalks.

“We've tried to do a lot of work down there with that triangle,” Wilson said.

The ZBA reconvened on Dec. 5 and unanimously turned down the request for a variance.

Cole's plan was to install two 1,100 square foot apartments, one upstairs and one downstairs. He figured he'd receive roughly $650 a month per apartment. Cole said the entire building is about 6,000 square feet, leaving another 4,000 square feet to be restored.

Wilson questioned Cole's intention to use rental money to renovate the front.

The village feared that the rest of the building would eventually turn into more apartments rather than a thriving business for downtown.

“We don't want him to put apartments on the ground floor,” Delvin Wilt, a co-chairman of the village's Zoning Board of Appeals, said. “We decided that there are a lot of empty stores downtown, and the rest would want to turn those into apartments, too.”

He said the board had turned down a store owner earlier who wanted to convert to apartments.

Wilt noted that children living in apartments farther uptown have no place to play.

“We've got to keep the kids off the streets,” he said.

Cole said when he originally bought the hotel in 2004 he intended to revive its original use as a restaurant and bar with rooms for rent upstairs. Cole even had a couple of people interested in opening up the restaurant, he said.

But there was a problem.

“When I bought it, I didn't realize that the front part of the building wasn't structurally sound,” he said.

The State Historic Preservation Office had estimated the cost of renovations at about $435,000, and $289,000 in grant money would have left Cole with $150,000 to raise. That grant stipulated guidelines to preserve the building's historical integrity with building materials - wood windows versus vinyl, for example. The cupola had to be restored as well as a Gothic arch.

But in September 2007 Cole decided to sell the hotel after a couple of Canadian investors had backed out of the project in August, shelving the state grant money without $125,000 in matching funds required. Cole had invested about $60,000 in the project.

The 123-year-old building is now gutted and deteriorating.

Sun Harvest Realty put it on the market for $39,900 last year, real estate agent Dean Cummins said. Then it was put up for auction on Sept. 25 with no serious bids. Cole said he would sell it for $29,900 in a heartbeat, maybe for even a little less.

“At this point there's nothing else I can do with it,” he said.

Meanwhile, he continues to pay insurance and taxes on the building. There is no mortgage. He said he wanted to preserve the architecture and perhaps could have if the grant was less stringent.

“I worked on it for three years,” Cole said. “I don't want to see it sit there and rot,”

Staff writer Kathleen Barran can be reached at 253-5311 ext. 238 or kathleen.barran@lee.net