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Two thorny development puzzles in Madison are still very much in play, say those who have been working on them behind closed doors.

The city's Board of Estimates laid out strategies in executive session on Monday to buy 20 percent of the rental housing stock in the Allied Drive neighborhood and to move forward on developer Gary Gorman's $84-million condo and retail project for the 800 block of East Washington Avenue.

Few of the details put forward by Mayor Dave Cieslewicz to revive the stalled Gorman project have been revealed, but mayoral spokesman George Twigg said it was unlike a package of public financing and loans that Ald. Brenda Konkel had forwarded and also different from a land-holding scheme thought up by Community Development Authority Chairman Stuart Levitan.

Twigg said this morning the mayor hoped to talk with Gorman today about his idea.

"We will see where that leads us," Twigg said. He said any new proposal would have to go through a full round of public scrutiny and approvals before it could be acted on.

The primary obstacle keeping Gorman's project from going forward is a question of financing. The developer had asked the city to support the two-phase project all at once with $4.2 million up front in tax incremental financing, but the city has refused about $2 million of that amount without firm guarantees that the entire project will be completed.

The deal is further complicated by having to relocate a car dealership at the site of the potential development, a large billboard that Gorman wants taken down and the question of what will get built when.

The Allied Drive property that the city is interested inpurchasing belonged to Troy Hauk, and consists of 129 apartments in nine buildings. The property, mostly on the 2300 block of Allied Drive, has fallen into receivership, and AmCore Bank is auctioning it in mid-April, Twigg said.

In open session, the Board of Estimates approved a recommendation to allow the city to bid up to $5.85 million for the apartments, which is their assessed value. The City Council would have to approve that recommendation with a super majority, 15 of 20 votes, in order for the city to bid.

Ald. Mike Verveer, who serves on the Board of Estimates, said that he thought council approval was likely.

Twigg said that the authorization to bid up to $5.85 million is "significantly higher than we're willing to bid" so that the mayor's office could cloak what they actually hope to spend for the property. AmCore's investment in the buildings is $4.5 million.

Ald. Zach Brandon, who also serves on the Board of Estimates, said that the mayor has mainly focused on how the city would acquire the Allied Drive property, and the details of how the city would transform the site aren't yet clear.

Twigg has pointed to the redevelopment of Simpson Street into Lake Point, which partially relied on more owner-occupied housing, but full plans for the Allied Drive property have not been revealed. He stressed that the city's costs for the area are high, and said that "improving the neighborhood requires us to improve the housing situation."