The Santa Rosa City Council Tuesday granted a third contract extension to a developer hoping to construct a 10-story mixed-use tower downtown.

Hugh Futrell and partners were supposed to have closed escrow on the city-owned former AT&T building by the end of June.

But the $1.9 million-sale ran into financing trouble following the state-ordered demise of the city's redevelopment agency, which purchased the vacant eyesore in 2007 for $3 million in the hopes of spurring development on the site.

When the redevelopment agency was dissolved, the City Council became the new owner of the building, a change that caused the title company handling the sale to delay action on the transaction while it evaluated the potential impacts.

Those issues have been resolved and the project, called Museum on the Square, remains on track to begin construction in the fall, Futrell said.

The terms of the extension call for the developer to continue to pick up the costs of utilities and maintenance of the building, as well as "reasonable project related costs."