HOLLADAY — Construction of a redevelopment project in the works for eight years could be delayed until spring 2009 because of problems with environmental contamination and utilities.

The Holladay Village Center project near 4500 South has been the city's fondest dream as well as its most recurring nightmare since its conception in 2000.

"I have never had a (redevelopment agency) project with as many problems as this," said city manager Randy Fitts, who has participated in several such projects in Holladay and as mayor of South Salt Lake. "It's just one thing after another."

The project has been billed as a walkable town center with a historical focus and an upscale and funky feel. When built, it will replace a harrowing five-road intersection and about 50 acres of old, vacant businesses and parking lots.

Environmental contamination has been found underneath one of those businesses, and city officials believe another dry cleaning business also may have caused problems.

Solvent has seeped into the soil in about a one-half acre spot around former Mr. Clean, located in the heart of the planned village, Fitts said. The city is also studying land under and around the still-operating Frampton's Cleaners, 4724 S. Holladay Blvd.

The problem around the Mr. Clean store seems to have been caused years ago, Fitts told city leaders during public meetings.

Frampton's Cleaners now has its toxic waste picked up by a disposal company, which then incinerates it, said Frampton's owner Sam Frampton.

The cleaner is working out plans to rebuild his business as the redevelopment project moves forward.

The city has been unable to study the issue over the long winter but plans to release results of ongoing studies within a week, Fitts said. Much information about the problem has also been confined to closed meetings because the city has been trying to purchase some of the land in question.

Eighteen new boreholes were recently dug to help the city learn how widespread the contamination is.

"It's coming out better than we thought it was," Fitts said of preliminary results. "We're not going to have to haul away all the concrete like we thought we were."

The city came across the problem as it was preparing to build new roads on the land. The project will vastly improve traffic flow in the area and has received federal funds.

The type of contamination around the old dry cleaning businesses has not been publicly identified. However, there are no shallow wells in the area and public health risk is minimal, Fitts said.

"It seems to have stayed on top," he said. "It has not gotten into the aquifer, and it's not a major source of contamination."