A developer planning to build a reception center on the current golf-course property has backed out, saying there's not enough space for the building and parking lot.

So, Mayor Mike McGee says, it's time to switch to plan B: The city will divide the would-be commercial space into two residential lots.

Last month the council approved a plan that could have given it the best of both worlds: Developers would rescue the city from its entire financial divot by purchasing current golf-course property to build 19 homes and the reception center. Then the city would reconfigure the course to maintain a championship par.

Cedar Hills now expects 21 residential lots near holes 13, 14 and 15, in addition to seven lots near the seventh hole. The city already is reconfiguring the course to allow for the development.

However, the change from commercial to residential on the single lot could deal a blow to the land's sale price. Rather than paying off the entire debt, the deal might eliminate only 80 percent of the bond.

For residents - they have a specific line on their property-tax statements that shows their annual share of the city's golf-course debt - the new estimate might decrease their average payment from nearly $200 to around $38, rather than zero.

Still, some are uncertain whether the residential developer - whom no one on the council has met - will go through with the project. The council only has the mayor's word that he will.

McGee said Monday that the developer he spoke with would "be the first to bid on the property."

"We'll go forward as planned," he said. "The development will sell, we'll pay off a substantial portion of the course and everyone will be just as happy now as they thought they'd be before."

But some City Council members remain leery.

"We're just going to keep our options open," said Councilman Jim Perry.

sgehrke@sltrib.com