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REGULAR MEETING December 12, 2016 Councilmember Davis presented to Mr. Matthews and Mr. Dvorak an analogy in which the Council and Mr. Matthews were two (2) friends deciding how to distribute mushrooms and black olives on a hypothetical pizza, and how to split the bill on the order of said pizza. Councilmember Davis argued that if the pizza cost forty dollars ($40) and Mr. Matthews paid for the entire pizza, he would be at Mr. Matthews' mercy — conversely, if Councilmember Davis paid for the whole pizza, Mr. Matthews would be at his mercy. He stated that he appreciated the fact that Mr. Matthews had previously stated that he wanted the Council to have more control over the fate of this project. Councilmember Davis stated that he felt that every suggestion given by Council was shut out by Mr. Matthews, though. Mr. Matthews went on to explain, using the pizza analogy, that if—instead of paying twenty dollars ($20), or half of the cost of the pizza right away—Councilmember Davis opted to pay fifty cents ($.50) every week for the next five (5) years, that would be equivalent to how the tax abatement would work for the actual PUD. He further explained that if Councilmember Davis paid twenty dollars ($20) right away, that would be equivalent to the City abiding by the East Bank Plan's call for the City to build a garage on the property within the last eight (8) years. He stated, If the garage was built by the City, as the plan called for, I can build a shorter building. So, if the City doesn't have the money to pay for the garage, we have no deal, unless we can figure something out. What I figured out is that if we do a modified tax abatement and we go taller, I can make enough money to cover the City's portion and say, "Great, I'll buy the whole pizza today. You can pay for your share over the next ten years." Councilmember Davis responded that he felt that as the project could not proceed without taxpayer money, that Council influence should in fact be equal to Mr. Matthews's. According to the analogy, where both Councilmember Davis and Mr. Matthews have twenty dollars ($20) apiece, Mr. Matthews could not buy the pizza without Councilmember Davis's contribution, no matter how Councilmember Davis chose to pay his share. Councilmember Davis stated that despite this, it had been portrayed to him that Mr. Matthew's influence was greater than his own. Councilmember Davis stated that he did not see the equal value of each party's influence, in practice. Mr. Dvorak stated that Mr. Matthews has been transparent about his financial situation. He further stated that it was rare for developers to present a dozen (12) different possibilities for a project, to which Councilmember Davis responded that Council had received these different configurations in the last week or two (2). Councilmember Broden added, You had ninety (90) days. Mr. Dvorak returned to the pizza analogy, stating that people had been clamoring in the East Bank area for pizza. Mr. Matthews showed up with the intent on buying the pizza for the people. Council then showed up, stating that they would pay Mr. Matthews back for the pizza over five (5) to ten (10) years. As this arrangement does not allow for both to buy the pizza upfront, Mr. Matthews would be the only one who could buy the pizza at the table, right then and there. He stated that Council still wielded the most influence of all: should they say that they did not want to do the project, the project would not go forward. Councilmember Davis responded that the only reason that Mr. Matthews has money upfront in this scenario is because he knows he will be paid back. Without the tax abatements subject to Council approval, the project could not happen. Mr. Dvorak agreed with Councilmember Davis. He further stated that population density was critical to the success of the grocery store, and that aside from those residing at the Pointe and Mr. Matthews' properties in the area, there were not many people living in the East Bank. Of those people, Mr. Dvorak stated that, to the best of his knowledge, almost all have supported the project. He stated, We humbly beseech your approval. Councilmember John Voorde deferred his question. Councilmember Tim Scott stated that he would defer his question as well, as he felt ready to make a motion. Councilmember Karen White asked if the only way, from Mr. Matthews' perspective as a developer, that the project could go forward was if it were eleven (11) stories tall. 13