The estimated $20 million project included a new library for the first few floors, with additional housing on higher floors.
Project Developer Kenton Peters said he felt his plan was presented with a negative and pessimistic approach by the city, although board members were more receptive to it despite their eventual rejection.
According to David Wallner, Madison Library Board vice president, the rejection of the proposal was a clash of priorities between the city and a private company.
But, he said, Peters' plan does merit another study.
"I think we basically blew [Peters] off, and I think there might be a way for the city to sit down and look at the numbers again," Wallner said. "My fear is we will sit here talking about building another library and it just won't get done."
Wallner, the only member to vote in approval for the proposal, said members found the development creative, but wanted to see further study and plans for more secured funding. The board felt the project was "risky," he added.
Members also expressed concern with relocating the library three times over the course of 18 months, Wallner said.
However, Peters said his plan only required the entire library to move once.
"The board thought the library would have to shut down and be essentially out of business for almost two years," Peters said. "Personally, I don't think our plan had the proper representation from the city."
Peters said Madison is in great need of a new library, and without a plan, officials are getting nowhere.
"The current library is 40 years old and not up to standards for the City of Madison, which deserves a state-of-the-art library," Peters said.
While members wanted to see increased research in regard to funding, Peters said his failed approach would have actually created the money necessary.
"[The city has] been trying to build a library for almost seven years, and they are looking for a big donor to come in and cover the costs," Peters said.
According to Peters, the money from leasing "air rights," or the space above the site, would eventually pay for more than $12 million of the project. He said the plan would require a 50- to 90-year lease.
"If the taxpayers knew it was paying for itself, they would wonder why [the proposal] was being turned down," Peters said.
Wallner added future action is dependent on whether the project garners support from large donors. He said the board would have to find $10 million to $15 million in private money to fund the project.
"There's only a limited amount of [city] money for all the projects," Wallner said. "But I also think that if you have a plan, it's easier to get money. That's just how it is."