City officials are proposing placing the Economic Development Department in the restored Phoenix Bank building after construction is completed in fall 2010.

The city expects to advertise the project in early 2010. Phoenix Bank, located at 341 E. Washington St., was established in 1919 by a group of black entrepreneurs. It served the black farmers and laborers of Suffolk and Nansemond County until its demise in 1931, during the throes of the Great Depression.

Since the bank’s closure, the building has sat vacant except for a few restaurants that have operated out of the first floor. The second floor was divided into several rooms to create four apartments that are no longer in use. The bank is listed on the Virginia Landmarks Register and the National Register of Historic Places.

The proposal to place the Economic Development Department in the building concerned Councilman Charles Brown.

“It is not what our original objective was,” Brown said after a Wednesday work session. “Due to a shortfall in raising capital, we had to go to plan B.”

The project initially was intended to be the centerpiece of The Fairgrounds revitalization project, serving as an African-American history museum. The city’s Economic Development Department originally was planned to move out of leased space and into the old Nansemond County courthouse when it is refurbished, but city leaders decided it would be better to keep the department in the city’s downtown core.

The 3,800-square-feet project will preserve the original character of the bank, said Gerry Jones, director of buildings and capital projects for the city.

“This is bringing the existing character back to life,” Jones said. The lobby of the building will be dedicated as museum space. Administrative offices will fill the first floor, just as it was when it was a bank, Jones said.

“We had to do the best we could,” Brown said. “Something is better than nothing, because it’s been there for a long, long time.”