Artspace Projects Inc. is applying for state Legacy Amendment funds to be used for a feasibility report of an artist live-work project in Albert Lea, Community Development Director Bob Graham said Wednesday.

Graham said Artspace is asking for $125,000 through the Legacy grants out of a total of about $250,000 needed for the feasibility study. If received, the Albert Lea community would have to produce another $125,000 for the study.

Graham said, because of the city’s tight financial condition, “the city government is really not in a position to add $125,000 to the fund, so what we’re really hoping is that the $125,000 will come from people who are interested and involved in bringing this type of project to the community.”

Graham said he thinks it is important to bring the Artspace project to Albert Lea for economic diversity.

The study will determine whether the project is still feasible in the city, whether the project would be in an already-standing building or if there’d be new construction, and what preliminary financing would include, among other things, Graham said.

Artspace — a nationally known, nonprofit organization dedicated to creating affordable, loft-like studios where artists can live as well as work — began in 1979 in response to the decline of Minneapolis’ historic Warehouse District in the 1970s.

Since, it has become the national leader in the field of developing affordable space for artists through adaptive reuse of old warehouses, schools and commercial buildings. Together with the cities it chooses to work with, it purchases and renovates buildings and then leases them back to artists at below-market rates.

In cities where the projects have occurred, there has been much revitalization in the other nearby buildings.

Representatives from Artspace originally came to Albert Lea in May of 2008, toured four downtown buildings with city leaders, met with members of the local art community and conducted a public forum to inform area residents of their mission.

In January 2009, Artspace sent out surveys to more than 4,000 artists and arts organizations as far south as Decorah, Iowa, as far east as Rochester, as far north as St. Peter and west to places like Mankato. Artists of all disciplines were invited to participate in the survey — including painters, sculptors, musicians, actors, writers, photographers and even culinary artists.

The survey was designed to help Artspace directors determine if there is a market for artists in the region.

More than 100 artists who completed the Albert Lea artist market survey indicated they would be willing to relocate to an artist live-work project in the city — a number which surpassed the threshold of interest necessary for Artspace directors to feel confident about moving forward with predevelopment work and discussions for a project in the city.

Graham said city leaders and Artspace leaders have talked every two months since the results of the survey came back.

While the project has been slow in the making, it is not dead, he said.

Graham said what building will be used for the project is “not necessarily known at this point.”

“It could be the Freeborn Bank building, but if there are other options that come along for that building in the interim, maybe the council would choose to take that option instead,” he said.

He noted Artspace has indicated that a project in Albert Lea is not directly tied to the Freeborn National Bank building.

“We’ve had more than one conversation where they have said the bank building is not the critical deciding factor in whether they would come,” Graham said.

He anticipated Artspace would find out in June about the grant.