BANGOR – A proposed affordable housing complex on Essex Street will be up for final approval from the City Council next month, but the developer first must show that 10 percent of the estimated cost of the project has been expended in order to retain a majority of its funding.

The project was discussed Wednesday night at a meeting of Bangor’s Business and Economic Development Committee and then recommended to the City Council, but nothing is set in stone yet.

That’s because more than $2.7 million of the project’s total cost of $4.6 million is slated to come from low-income federal tax credits allocated by the Maine State Housing Authority. That can’t happen unless 10 percent of the total cost ($460,000) is accounted for by June 19.

The tax credits come from corporations or individuals who, instead of paying owed income taxes, invest that money in low-income housing.

The project’s developer, Realty Resources of Rockport, received the go-ahead to pursue the project nearly a year ago and then inked a tentative development agreement with the city in January.

The project has been held up over parking concerns and site plans, which have since been addressed. Project manager Tom Williams said Wednesday that the process has been “pretty typical,” but added that the next few weeks will be critical.

“A lot of things have had to be done [on this project]; there were a lot of issues with this site, but we knew that going in,” Williams said.

“We need to have our finances in place soon or we could be looking at our second plan,” he said.

Realty Resources already operates low-income and assisted-living housing programs at the former Freese’s department store on Main Street. The latest project would build eight buildings containing 32 units on the former Naval Reserve Center site on Essex Street.

If the City Council approves the project at its June 13 meeting, the 3.2-acre plot would need to be rezoned to high-density residential, but city leaders said they don’t foresee any more setbacks.

“We feel confident about this moving forward,” Bangor Community and Economic Development Director Rod McKay said.

City councilors also said they would notify residents in the immediate area of the proposed project so that they might have a chance to comment on it at the next council meeting. Construction would begin in the fall if all goes well, Williams said.

In other news, the Business and Economic Development Committee recommended to the City Council an agenda item authorizing an extension on a property exchange between the city and the University of Maine System.

City councilors already have signed off on the deal that would provide Bangor with buildings and land on Maine Avenue owned by UMS. In exchange, UMS would get the top three floors of the former W.T. Grant building on Central Street.

The exchange was supposed to take place on or before June 30, but because renovations at 6 Central St. are taking longer than expected, the committee recommended a date of Oct. 30 to allow time for completion.