Jorge Valenzuela and his wife, Lisa, had a building permit and thought they did everything right in preparing to build a new $330,000 home in Central El Paso’s Austin Terrace Historic District.

But because of a mistake by City Hall their future dream home has become a very real nightmare.

They have spent more than $100,000 so far, but the city stopped construction a month ago, and as a result of City Council action Tuesday, their partially built house at 111 Pennsylvania Place may never be finished.

City regulations will prevent the Valenzuelas from doing anything with the property for a year, and they may even have demolish the unfinished frame structure themselves at a cost of $65,000.

But not without a fight, Jorge Valenzuela vowed angrily after the 5-2 vote on a motion by West-Central Rep. Susie Byrd.

“We’ll be suing the city,” he said. “It’s cut and dried.”

The Valenzuela house was one of two in Austin Terrace that the same group of neighbors thought were just too big and appealed the Historic Landmark Commission’s approval of the certificates of appropriateness that the owners needed to build their homes.

Such appeals are extremely rare but both cases landed in City Council’s lap Tuesday.

The other owner, Polish-born Adam Baginski, was luckier than the Valenzuelas. He persuaded the council to deny the neighbors appeal and will be allowed to go ahead with the construction of his two-story, 4,000 square foot house at 19 Cumberland Circle.

An El Paso native who spent seven years working in advertising in Dallas, Jorge Valenzuela said he had a hard time persuading his wife that life would be better in his old hometown in a new home just a few blocks down the street from the house where he grew up.

He said he came back to join his father in the cement business. The vacant lot in the historic neighborhood was a gift from his father, who lives nearby.

Valenzuela’s application for a building permit clearly showed the property was in a historic district.

But, the head of development services, Larry Nichols, said the city’s computer system failed to flag the application as needing approval by the Historic Landmark Commission.

“When this project came forward, we were not identifying vacant lots,” Nichols said, adding the problem has since been corrected. “It’s not going to happen again.”

Valenzuela’s building permit was approved and work on the house began.

“Having experience in construction, I see the building permit as a green light,” Valenzuela said, adding he was unaware that the project lacked landmark commission approval.

Construction was well under way until the city’s historic preservation coordinator, Troy Ainsworth, happened to notice the construction while driving through the neighborhood one day in March.

The city issued a stop work order pending a March 15 hearing before the landmark commission.

Over objections from neighbors, the commission gave its approval to some revisions in the house’s design that Valenzuela was told to return with on April 7.

Valenzuela’s architect made the revisions, and they were good enough for the commission, Nichols said, but it could not give final approval because the neighbors filed an appeal, sending the case to City Council.

Five of the landmark commission’s seven members are architects, and on April 7, Nichols said, they “determined they could approve it.”

One of the complaining neighbors, Michael Towne, said he and others collected two petitions with the same 130 signatures opposing the Baginski and Valenzuela houses.

“The arguments I have on this house are the same as the last one,” he told the council. “It’s too much house and too little lot.”

With a large, two-car garage closest to the street while other garages in the 1930s era neighborhood are in the rear of most of the other homes in the area, he said, the Valenzuela house is typical of West Side homes but has no business in Austin Terrace.

“If that’s the direction we’re going in, we do not need an historic district,” Towne said.

Eastridge/Mid-Valley Rep. Ortega replied, “The city dropped the ball. I’m going to have a real hard time penalizing him for our mistake.

“We screwed up, and may have to swallow the pill.”

Northeast Rep. Castro agreed, and asked how the city is going to resolve the situation.

Robert Estrada, a neighbor of Byrd’s, said Valenzuela is just the kind of El Paso expatriate the city needs.

“I’m concerned about the message this is sending to people who come back,” he said.

Valenzuela’s wife, Lisa, tearfully said their three small children have been cooped up in an apartment with no back yard for months.

“I’m just asking you to make this right for us and not require us to make this right for ourselves,” she said.

But another neighbor, Todd Southern, said the Valenzuela’s two-story house would be like a huge “Tibetan monastery” on a street with small, one-story homes – a $300,000 castle next to his modest $74,000 house.

“My solution? Make it conform. Move the garage and compensate the Valenzuelas. Take off the top story,” he said.

Byrd agreed that the house doesn’t fit the neighborhood.

“I know we made a mistake,” she said. “But I cannot support the certificate of appropriateness.”

With that, she offered the motion to approve the appeal.

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David Crowder can be reached at dcrowder@epmediagroup.com and (915) 351-0605.