The La Crosse city council could decide next month whether to develop new affordable apartments on the upper floors of the Rivoli theater building on 4th Street.
A community development committee wants to give a developer $300,000 in block grants to remodel the higher floors.
City planner Jason Gilman said it makes sense to renovate an existing downtown building, as opposed to putting up new apartments elsewhere.
The proposed apartments above the Rivoli would be available to lower-income residents, including people who are now homeless.
Gilman wants to see an economic mix of people living in the business district.
The renovations would not affect operation of the Rivoli movie theater.