The location of Orange Line bus rapid transit has emerged as a key issue in talks over the future of the Southtown Shopping Center in Bloomington, one of the Twin Cities' first and still most popular suburban shopping plazas.

With officials of Metro Transit, the city of Bloomington and Southtown owner Kraus-Anderson Realty Co. unable to agree on the center's future, they're proposing to give themselves six more months to reach a deal.

The Bloomington City Council on Monday is expected to endorse a memorandum of agreement that would put a hold on any new development at the site by the owners until mid-August. In turn, the city would agree to delay any decision on rezoning Southtown until then.

Southtown's fate is tied to a proposed rezoning that would, over time, transform the entire neighborhood surrounding the center. Built in 1960, Southtown is a classic, car-centered shopping destination. Its 40-plus acres are dominated by a giant asphalt parking lot, ringed by stores.

The city of Bloomington wants to encourage denser, more pedestrian- and transit-friendly development in the area. Its proposed rezoning would require taller buildings, a more gridlike street pattern, sidewalks, and a wider array of uses, such as offices, hotels and apartments.

A key to that vision is Metro Transit's proposed Orange Line, a bus rapid transit service that will connect Burnsville and downtown Minneapolis. Current plans call for a major transit hub at Southtown, with the line running on Knox Avenue through the heart of the shopping center. Southtown's owner would prefer to see the line skirt the eastern edge of the property, closer to Interstate 35W.

"We're still at an impasse as to what's going to happen with the Orange Line," said Ken Vinje, director of properties and redevelopment for Kraus-Anderson Realty. "If the Orange Line is going to come through, we're just saying, in essence, go around us.

"If we do that, then we feel there's the ability to do the high density the city is looking for," Vinje said. "And we're willing to commit to that."

Steve Elkins, who represents the area on the Metropolitan Council, said that Kraus-Anderson has suggested several alternative routes for the line but that none of them is feasible. But Elkins said the Met Council is fine with the six-month delay.

"It gives us time to work out any of those issues collaboratively," Elkins said.

Glen Markegard, Bloomington's planning manager, said discussions have been productive and cordial.

"We've been making progress," Markegard said. "And we think it's worth everybody's time to continue to make progress toward a win-win. Our interest is to see the Orange Line come into service. As long as it's an alignment that works technically for Metro Transit, we have no interest in micromanaging the route."