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ARDEN HILLS CITY COUNCIL WORK SESSION - JULY 21, 2008 11 Mayor Harpstead noted he would be in favor of setting a floor with a greater upside potential on the back end than promising 150/0 upfront. Ms. Kvilvang indicated she was merely looking for Council comments and would take this information back to the developer for further negotiations. She explained they can then choose to proceed with the Council's request or be done with the deal. Councilmember Holden stated in her conversations with several bankers they were surprised the developer was requesting only 150/0 because most developers were requesting 18-20%. Councilmember Grant stated this may be the case, but that Ryan Companies does not have the level of risk they are predicting with the property sales. He indicated however, he does see a risk in the time their money will be invested. Councilmember Grant explained that Ryan Companies would not be completing the residential developments which had the largest amount of risk. Discussion ensued regarding unknowns that may arise during the development and sale of properties within TCAAP. Ms. Kvilvang stated if an issue were to arise, this would have to be negotiated with the developer. Mayor Harpstead specific performance clauses should be written into the developer's agreement to hold the developer accountable and that they be obligated to complete the project. Councilmember Grant stated he felt the biggest risk was not the environmental concerns. He indicated the market was his concern at this time, along with the upfront costs of preparing the property for sale. Councilmember Holmes questioned if the developer would be retaining profits from the land sales in the first years of the project. Ms. Kvilvang reiterated the fact that any funds taken in would be paid back out to repay loans taken out by the developer.