A project by the University of North Carolina’s School of Government could result in downtown redevelopment ventures in Washington.

Last month, the Washington City Council gave its OK for the city to accept a three-year, no-interest loan from the Beaufort County Committee of 100 to fund the School of Government’s redevelopment project. A portion or the entire loan could possibly be forgiven if a substantial development results in new investment and the creation of jobs in Beaufort County, according to city documents.

“It’s the UNC School of Government — they’re development finance initiative group. It’s a cool project. Essentially, what they do is the act like a developer, and they come in and look at it like they were going to develop it, if they think it makes sense,” City Manager Brian Alligood said.

The resulting proposal could include plans for a downtown hotel.

“That’s what we’ve asked them to look at,” Alligood said.

“What they’ll do is — the guy who runs it is a developer — they have all the resources of the School of Government, the financing, the legal and all of that. They’ll come in and look at it and say, ‘Yes, it makes sense’ or ‘No, it doesn’t make sense.’ If it makes sense, then they will issue an RFP (request for proposals) for a developer to come in and do it. And if a developer … signs on, then they get an additional amount of money from the developer,” according to Alligood.

Basically, Alligood noted, the School of Government is doing a feasibility study “on steroids” regarding a downtown redevelopment project.

“The end goal of that is to have a developer in hand at the end of the project to do it,” Alligood said. They’ll do all the upfront due diligence. So, they can hand it to the developer and say, ‘See, the numbers work. It will work.’”

When meeting with the School of Government representatives several months ago, Alligood said, “I asked the question … OK, that sounds all well and good, but what happens if you put it on the street and you don’t get anybody to respond to your RGP. They said, ‘It wont happen. Guarantee it won’t happen.’ They said, ‘We have developers sitting the wings, waiting because they know we do good work. They know it will work.’”

Alligood said the School of Government told him and other city officials that a developer will spend about 3 percent of project budget on due-diligence work.

“Part of the RFP, from the developer, if they sign on the dotted line to do it, they have to pay the School of Government 1 percent. Typically, it costs them 3 percent. The School of Government says, ‘We’ll take 1 percent because we’ve already done all the work for you,” Alligood said.