Winooski voters will decide on Town Meeting Day whether to invest in a second municipal parking garage to reduce competition for spots in the city’s $200 million redeveloped downtown.

The new five-level garage would cost $9.7 million and accommodate roughly 300 vehicles. It would be built on what is now a dirt parking area along Abenaki Way, adjacent to the Community College of Vermont building. The city-owned lot is just seven-tenths of an acre.

The city is also proposing a land swap that would allow developer Adam Dubroff to build a roughly 90-room hotel on the lower part of the same lot. He had previously proposed building a boutique hotel on a 0.18-acre parcel two blocks away, wedged between the historic Champlain Mill and the Main Street bridge that spans the Winooski River.

That proposal hit a buzzsaw of opposition from neighbors, though. Some feared it would crowd the historic mill and block downtown views of the Winooski River falls while taking over what is now a sliver of green space.

A group of neighboring property owners known as the Winooski Downtown Redevelopment Association opposed the plan mostly because it did not include on-site parking, and instead called for valet service connecting with parking options. They worried the hotel would exacerbate competition for slots in Winooski’s only municipal garage, an approximately 930-space structure on Winooski Falls Way that is often full during the day.

In a related dispute, UMB Bank, the lenders that control the 312-unit student apartment building Spinner Place next to the garage on Winooski Falls Way, sued the city in 2017 over access to spots in the garage.

The suit claims the city unfairly terminated Spinner’s garage lease, and that the city had allocated too many spots in the garage to businesses.

The new garage would pave the way to a resolution of that lawsuit and help the city finish the build-out of Winooski’s downtown, according to city manager Jessie Baker. The city would borrow to build the garage, and parking fees would cover its cost, according to Baker. “There’s no property tax impact,” she said.

The garage would be open to the public for paid use. The city also plans to sell permits under contracts with big users: the hotel, CCV and others.

The Winooski City Council voted unanimously on January 28 to put the measure on the Town Meeting Day ballot that goes before voters March 5. Business leaders including Brian Tarrant, co-owner of the Champlain Mill, are on board, too.

“I think it solves a lot of problems. I think it will increase the tax base and the business growth in Winooski,” said Tarrant. “It should be a win for everyone.”

Over the years, there has been “tons of open space” in the Champlain Mill because Tarrant could not guarantee prospective tenants enough daytime parking, he said. The new garage should ease that crunch and help multiple property owners prosper, Tarrant said.

The hotel would be an important anchor for downtown, said Winooski community and economic development officer Heather Carrington. In presentations to the city council, Dubroff has suggested the hotel could be affiliated with Hilton’s affordable chain, known as Tru.

Both the garage and hotel would require permits. The land swap has not been finalized. The city’s goal is to combine the Dubroff parcel by the bridge with a small, city-owned lot as a community park, Carrington said.

Dubroff did not return messages seeking comment.

The garage proposal is just one of several big projects envisioned in Winooski. A second bond item on the Town Meeting Day ballot calls for a $3.7 million rehab of Hickock Street to include new water and wastewater infrastructure. Water fees and any available grants would fund it.

The proposed $7.3 million municipal budget for Winooski would include a portion of the funding for two major projects that voters approved at the polls last year: the $23 million reconstruction of Main Street and the $3.9 million Myers Memorial Pool complex.

The city budget would increase the municipal tax rate an estimated 6 percent.

Meanwhile, the city is hoping to increase revenue with a proposed 1 percent sales, meals and beverage tax that is also on the Town Meeting Ballot. The revenues would help pay for the Main Street project, according to city leaders.