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Attached is a chart which does not include the difficult to predict inflationary factors that should be considered now more than ever for each delayed year. The included chart outlines the history of costing factors and a comparison between the actual proposal of the "full" geothermal system and the 2007 Bloomington example of a "full" conventional indirect system. Note that with the conventional system option, the city will be faced with some of the same issues including, i.e. sand and equipment removal from a rink with limited access, unanticipated frost levels, etc. Although the intent is always to attempt to uncover as many of the unforeseen areas as possible, refurbishments always appear to be somewhat of a mystery. Another major consideration is that as projects are delayed, numbers change and are going up. As we have seen, for various reasons, including a very specialized area, project estimates and accurate numbers have been very difficult to obtain for this project. Project delays are also proven costly. From the beginning, this project has been unique, complex and somewhat unknown. Assuming the project continues, it is expected to continue to be the same. Although the best -value process has required a quality control plan for risk assessments and will identify a fixed price, it does not immune the project from unusual circumstances for risk items the contractor cannot control, i.e. soil contamination? Given previous discussions and action by the City Council the apparent options include: 1. Award project to the best -value contractor for a "full" geothermal system with funds to be taken from the city building replacement fund and the city pavement management program as previously outlined by City Finance Director Chris Miller. 2. Cancel the project for this year 3. If cancelled then proceed with the selection of an engineer for plans and specs for a conventional indirect system for summer of 2009 — (Bloomington rink example — similar project for an indirect system, using a small quantity of Freon, in 2007 dollars was $1,500,000, which included a $400,000 unplanned expenditure for frost removal (this does not include rooftop units that need replacing in our project) . It is very difficult to predict inflationary factors which we are seeing to be extremely high in this area of limited expertise. 4. If canceled, then summer 2008 would require an inspection and repair of the Freon receiver (difficult to indicate what will be uncovered as ice currently surrounds the barrel) 5. If cancelled, revert back to the existing conventional Freon system and do necessary component repairs. This is the least environmentally friendly option and would be setting the stage to continue this approach in the future. The Freon that the arena uses is in large quantities and is expected to begin to be phased out in 2010. Also, as a part of the geothermal research, other unforeseen items that need attention have surfaced, i.e. arena rooftop condition, new concrete radius necessary for dasher boards, availability and price of steel piping for floor, etc. Also inflationary factors in 2009 need to be strongly considered. Page 2 of 3