The area Mercer County Housing Authority and Ralph A. Falbo Inc., Pittsburgh, are eyeing for the redevelopment of Steel City Terrace in Farrell crosses three zoning districts.

None of the districts -- single- and multi-family residential and light industrial -- is completely compatible with developers' plans, and each would require a series of zoning changes, variances and/or special exceptions under the zoning ordinance.

But city planners have proposed a way to simplify the process of getting city approval for the redevelopment, while giving the city added control in the plans.

Farrell Planning Commission went along with that plan Monday by recommending to council that a new zoning district called a traditional neighborhood development zone be created and added to the zoning ordinance.

The zone is called an overlay district because it would be placed on top of the current zoning districts and does not replace the zones already in place. It would pertain only to the redevelopment or other large developments that might come along in the future, and requires the city to activate it.

The developers do not have to own all property in the overlay zone, but they have to show how their plans would tie into a cohesive neighborhood, said city consultant Rick Grossman of Graney, Grossman, Ray and Associates, Grove City.

The developers will need to submit two plans outlining the development, covering everything from streets and utility lines to landscaping and open space. Public hearings will be held before the planning commission and council make their decisions.

The authority and Falbo want to create a traditional neighborhood development with a northern boundary of Bond Street and the southern line at Kedron Street.

The eastern boundary would be Mrytle Alley, which runs between Hamilton and Emerson avenues.

The western boundary would be Maple Alley, which runs west of Spearman Avenue, from Bond to Kishon Street. Across Kishon, the line would pick up at a vacated thoroughfare called Thorn Alley, which would run halfway between Kishon and Kedron, with Spearman being the western boundary to Kedron.

The developers plan to demolish the 100 units of public housing in Steel City and replace them with 74 new public housing apartments, 35 higher-rate rental units and 26 homes for sale. Some of the work would be done off the Steel City site.

The proposed traditional neighborhood development zone is much larger than developers are initially planning to build in, but the larger size will give them the flexibility, said Frank Gargiulo, the authority's coordinator for the so-called HOPE VI development.

The overlay zone would allow the main components of the developers' plans: single-family homes and multi-family dwellings of up to four units.

The zone also would permit home occupations, day-care facilities, financial institutions, professional offices, civic and cultural buildings, small retail businesses, personal services and parks and playgrounds.

Mercer County Regional Planning Commission will consider the overlay today and make a recommendation to city council. The city will hold a public hearing before council can OK the proposal.