A couple proposing to build a 189-seat restaurant across from Lithia Park has abandoned the idea after the Ashland City Council approved the plan on Wednesday with conditions that included $250,000 in parking impact fees.

A couple proposing to build a 189-seat restaurant across from Lithia Park has abandoned the idea after the Ashland City Council approved the plan on Wednesday with conditions that included $250,000 in parking impact fees.

Jon and Esther Phelps, founders of Seattle-based Storyville Coffee, released a statement on Friday saying they would not build the restaurant.

"We are disappointed that the dream of Storyville in the Park has come to an end. We have concluded that the terms and conditions put forth by the Ashland City Council render our project unfeasible," they said in the brief written statement.

The couple, who have an Ashland home, added, "We would like to thank the City of Ashland and all who participated in this process for their time and effort. We are thankful for every day we get to spend in this beautiful town."

Consultants for the Phelpses had warned that the project would not move forward if the council charged parking fees, or if it banned medical office space as a potential future use for the building.

During a special meeting on Wednesday, councilors did not require the Phelpses to provide additional parking for the restaurant, but they did impose $250,000 in fees that would have been used to add downtown parking in the future.

At one point, the council had considered fees as high as $408,750, which could have paid for parking spaces in a parking garage, rather than cheaper parking lot spaces.

Councilors also decided that the building could not be used as a medical office in the future because that use would cause too many traffic and parking problems from patients going to and from appointments.

In small votes leading up to the decision whether to approve the restaurant, a majority of councilors voted to impose the parking fees and the ban on medical uses. All councilors voted in favor of the overall project.

In a written statement, Mayor John Stromberg, who only votes to break ties, said he was sorry to learn on Friday that Jon and Esther Phelps had decided to withdraw the project.

"The Council voted unanimously to approve it and I believe we were all hopeful that the project would move forward and provide many benefits to the community," he said.

Stromberg said the Phelpses had clearly wanted to create a high-quality product that would have been appropriate for the unique and sensitive site across from Lithia Park and near the downtown.

"At the same time, a project such as this doesn't exist in a vacuum and the critical nature of the parking and medical offices issues had been under discussion from early on in the application process," Stromberg said.

"Ultimately, the Council had to exercise its responsibilities regarding the project's impact and did so by adding conditions to which the Phelpses object."

Stromberg said he personally hopes the couple's interest in Ashland will continue and will eventually result in a development at the Winburn Way location or elsewhere that fits in with the community while fulfilling their vision and business needs.

During months of public meetings, councilors and residents expressed different views about the proposed restaurant.

Some said it was too big, would worsen parking headaches downtown and would draw patrons away from existing restaurants. The restaurant would have had a basement, two above-ground floors and a third-level observation deck with a glass roof.

Others said it would create construction and restaurant jobs, and would be an amenity for users of nearby Lithia Park and the winter Rotary Centennial Ice Rink. The Phelpses had offered, at their cost, to construct a small heated building for the city that would have housed ice rink rental equipment, restrooms and a garage for the city's Zamboni ice-smoothing machine.

Staff reporter Vickie Aldous can be reached at 541-479-8199 or vlaldous@yahoo.com.