City commissioners Tuesday withdrew their plan to give the downtown Transit Village project a tax benefit of as much as $114 million and instead directed staff to draft a new proposal more palatable to taxpayers.

The move, with developer Michael Masanoff’s consent, prevented the commissioners from going to battle with Mayor Jeri Muoio, who had vetoed the deal as too rich. The commissioners, sitting as the board of the city’s Community Redevelopment Agency, were poised to overturn the veto to move the project negotiations forward but Masanoff said through an attorney that he would rather start over in working out terms for the negotiations, rather than tangle the deal in a battle between the mayor and commissioners over whether the mayor has veto power over the board.

"Mr. Masanoff wants the opportunity to make Transit Village a reality," his spokesman, Bruce Lewis, said after the one-and-a-half-hour discussion that was scheduled to last at most a half-hour. "It’s too important to the city, too important to the region, for it just to go away."

"Our business is building a project, not building a lawsuit," Masanoff attorney Michael Karsch said.

Muoio, in Washington, D.C. for the U.S. Conference of Mayors annual meeting, was not present for the vote.

City commissioners last week approved payments totalling up to $114 million over 29 years to cover the cost of the project’s parking garage, with the money to come from property tax revenue the project is expected to generate. The amount was meant as a starting point for negotiating terms for the project, and to help Masanoff secure financing.

But Muoio objected so strongly to the potential size of the tax-increment financing subsidy — her staff had recommended a maximum of $25 million — that she issued her first veto in more than five years in office.

Her veto gave the commissioners, acting as the five-member board of the Community Redevelopment Agency, a chance to to override the veto at the next meeting, if they could muster four votes. That means the three who voted for the $114 million last time would have to convince either Corey Neering or Sylvia Moffett to join them. Neering said before the meeting that he was prepared to vote with the majority this time, to kill the veto, because he said he did not believe the mayor had veto power over the agency.

But it never came to that. Just before the vote, Masanoff called his attorney, who came to the dais to say the developer would not object to starting over again with a new deal.

The option to withdraw last week’s vote was one proposed at the start of the meeting by Commission President Shanon Materio, who chaired Tuesday’s session in Muoio’s absense and acknowledged public opposition to the $114 million deal. But her colleagues did not support the move until the developer’s lawyer said Masanoff was OK with it.

The mayor and commissioners all said they want the project. It was just a matter of how much the city should give a developer.

The project would create a transportation hub for the growing city, including a 2,300-space garage, a hotel, office and condo buildings. But the mayor and her administration said that $114 million was many times more than any developer ever received, public purpose or not.