The selected buyer of 12 rental complexes is asking for an additional six months to a year to pay a large share of $142 million it promised to Honolulu — and 20 more years to pay the rest, city administration officials said Tuesday.

The request by Honolulu Affordable Housing Partners LLC would put a $20 million hole in this year’s city operating budget because the money, which was supposed to be paid by the deal’s March 31 closing date, had been programmed into the fiscal 2014 budget so it could be spent, Managing Director Ember Shinn told the City Council Executive Matters and Legislative Affairs Committee.

The buyer returned to the negotiating table only after the city agreed to consider providing "seller financing." This came after the buyer claimed actions by the Council had put the city in default of the agreement.

Shinn said the buyer has proposed deferring making any payment until about six to 12 months after the scheduled March 31 closing date, at which point it would pay the city "the bulk" of the $142 million purchase price. City officials estimate that payment would be $132 million to $137 million, she said.

The remainder would then not be paid until about 20 years later. The reason for the delay in payment is because the buyer anticipates fewer tax credits than originally projected.

Shinn said the city has not agreed to the terms. She said she hopes to give Council members more details in a report next week, at which time many basic terms need to be agreed upon so paperwork can be wrapped up by March 31.

The city intends to receive some accrued interest on the deferred payments, although how much is still being negotiated, Shinn said.

City Budget Director Nelson Koyanagi said the city will look at holding off scheduled payments to "provisional" or rainy day accounts as the first means of fixing a $20 million hole in the current year’s budget, and will cut services only as a last resort.

The administration’s report drew a skeptical reaction from Council members.

"This raises more red flags for Council members concerning the buyer’s ability to obtain the financing necessary to close the transaction that we’re all concerned about," said Councilman Ron Menor, committee chairman.

Other Council members questioned the legality of agreeing to extend "seller financing" to the buyer, a major change from the signed sale agreement, late in the process.