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Ms. Kvilvang responded 93% is considered full occupancy. 100% occupancy is considered rare. Commissioner Elvig commented he did not believe anyone would finance this project after it has been built, unless it has outperformed, which is unusual. He said he would like to know more about the agreement with PNC. He noted there are a lot of factors. Banks are not loaning now especially when there is this much interest in a development. He said he does not have an issue with the City functioning as a financing arm, but he does not want to subsidize any further. He commented the real risk is what happens after the financing and how fast the City can get the spaces rented. If they had met certain thresholds, then the problem is the gap in the lease rates. Development Manager Lazan noted discussions with Flaherty and Collins have not been started. He indicated he wanted to be assured the HRA was comfortable first. If this does not move forward, he has to work more on the real estate deal. For the purposes of this demo, he said his firm assumed there were no negotiations. He noted his staff asked F&C what it would take to close now, and this was their response. Chairperson Jeffrey questioned if the HRA has written a loan for any other business in this community to this magnitude. He stated he is aware this is a catalyst project, but he is not in favor of it. He said if they cannot make it work on their own, he is not interested. Commissioner Wise pointed out the HRA did finance the City Hall and Parking Ramp and they are a catalyst. The HRA was a partner with the City and Town Centre. He said he is leaning toward getting this done because there is so much more tied to it. Commissioner Tossey said it was mentioned that the development team went to F&C and asked what it would take to close now. He said his concern is that there was a plan in place and it was for a closing date in May. There was a date in place, and the financing was to be in place for that date. Development Manager Lazan explained the Team started to realize the June start date was becoming more difficult. To keep to that schedule, the first date needed to be pushed to June 30 and it was tied in with the ramp. Since the ramp, F&C, and the rail station did not come together at once, it led to the question of what would it take to close. Commissioner Backous stated there are a lot of reasons to back off from this project. He noted that a lot of professionals have weighed in on this, including financial professionals. If they are not willing to go in on this, he believed the HRA shouldn't either. Finance Director Lund noted this would not affect the debt limit because it is backed by TIF revenue. Commissioner Backous stated he approves of the project concept but felt the HRA is going "too far out on a limb." Housing and Redevelopment Authority / May 10, 2011 Page 3 of 5