The Southern Pines Town Council on Tuesday adopted a resolution to help Pace manufacturing company open a facility at the Southern Pines Corporate Park by paying up to $20,000 for its transportation expenses.

The state is also providing funds to the company, which will create up to 35 jobs within a certain period of time following its relocation to Southern Pines by June.

The corporate park is on land bounded by North May Street, Yadkin Road and U.S. 1.

The council also unanimously approved a contract with The O'Connor Co. for $174,194 to rehabilitate the old brick freight depot.

The N.C. Department of Transportation is providing about $125,000 for the project.

The council voted 3-2 to deny a minor modification in a master development plan requested by Lee Sherman and her husband, Wilson, developers and residents of Pine Grove Village off Airport Road. The town approved the master plan 22 years ago.

The Shermans were seeking permission to sell off the remaining acreage set aside for multifamily in the approved plan for 11 single-family lots instead. Pine Grove Village is located just south of Sandhills Community College.

The couple resides at 200 Edgewater Place in Pine Grove Village.

Fred Hobbs, the consulting engineer on the original project, accompanied the Shermans to support their proposal to alter the plan because market conditions have changed.

A 1984 plan approved by the council allowed them to build 42 villas, which they did, but the units did not sell very well, Lee Sherman said.

"It took a number of years to sell them," she said.

People in the market for such housing preferred to be closer to town services and stores, she said.

The Shermans completed the first two phases, including the single-family home sites in the project, leaving 11.5 acres still to be developed.

"We decided it's still not a good location for multifamily, lower-priced housing," she said. "We decided we want to do a third phase with 11 single-family home sites on the remaining acres."

The lots would be similar in size to those in the other two phases, she said, and would have the "same type of road and amenities" as the other single family sites.

But Councilman Chris Smithson and Mayor Pro Tem Fred Walden reminded the Shermans that eventually there will be retail and commercial development in that area as N.C. 22 to the northwest is realigned.

Pinehurst Area Realty plans to build a shopping center at the corner of Airport Road and N.C. 22.

The Shermans said they held off asking the town to approve the change in the development plan.

"We're getting too old to start out with a new multifamily development," Lee Sherman said.

Councilman Mike Haney said, "Unless we see a compelling reason, this is about the only place that offers lower-price (housing), which we want to encourage in the area."

Hobbs said the Shermans would "just like to get rid of it, clear the slate. ... If they put the property on the market, they may be able to sell the land for multifamily housing ... but I don't know that with today's value of land in that area it will lend itself to affordable housing."

Councilman David Woodruff said, "The Shermans are responding to the market conditions ... That's what the Planned Unit Development (PUD) is about."

Haney said that even if the council denied their request, "It's still possible that someone could come in and develop multifamily into $800,000 condominiums."

Mayor Frank Quis disagreed.

"I'm going to stick with the original position," he said. "These single-family lots will not bring affordable homes. I don't think someone will put up $800,000 condominiums."

Woodruff's original motion, which had died for lack of a second, was then revived by Smithson, who made a motion, to approve the Shermans' request.

Quis, Walden, and Haney voted to deny the Shermans' request.

In other business:

-- The council unanimously approved architectural plans for an addition to the Jarest Building (Mews) for Pinnacle's proposed condominium-office building west of Broad Street and a covered parking structure at the Overlook at Pine Knoll.

-- The council voted 4-1 to approve an architectural plan for a vinyl-covered equipment storage building to be built at Pinecrest High School in the rear football and baseball field areas visible from Knoll Road.

The plan came in too late to be included on the written agenda, but the council agreed to consider it.

Smithson cast the lone dissenting vote.

Max Dean, a coach and booster club volunteer, said the building is needed to store more than $30,000 worth of new football equipment and other supplies that will deteriorate in the weather until the building goes up.

Smithson complained he hadn't personally ridden by to look at the location, since until the meeting began he didn't know it would be voted upon Tuesday.

"At the last meeting, we asked for sealed architectural drawings to (be provided) to us from Pinecrest," Quis said.

"It's no biggie," said Woodruff, who finally made the motion to approve the plans.

-- The council accepted the 2005-2006 outside audit report

-- It adopted a resolution honoring the late Robert Ewing, a former longtime county commissioner and former Southern Pines mayor and councilman.

-- The council also named Heather McDonald to a new four-year term on the Historic District Commission and John Heckethorn to complete a term expiring in November 2007.

Sara Lindau can be reached at 693-2473 or by e-mail at slindau@thepilot.com.