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    The memorandum of understanding between The Environmental Project and KUD International will guarantee an on-time, on-budget completion guarantee, said Nancy Quellhorst, director of operations for the project.

    The agreement, completed Tuesday, calls for a construction budget of $160 million, Quellhorst said. KUD has agreed to pay back $500,000 per month if construction is not done by the May 1, 2009, deadline, she said.

    The company will be paid $5.5 million in stages, Quellhorst said, with most being paid during construction. The Environmental Project will pay 15 percent of the contract, or nearly $825,000, during the current pre-construction planning stage.

    The agreement also calls for the project to raise $90 million by Oct. 31, 2006, so construction can begin, Quellhorst said.

    ‘‘It’s a bold but achievable task,’’ she said of the fundraising deadline.

    The 20-story rain forest will be built near Interstate 80 in Coralville, in a brownfield area called the Iowa River Landing District. Billed as a tourist attraction and learning center, the rain forest is to include a 1 million-gallon aquarium and is expected to draw 1.1 million to 1.5 million visitors a year.

    KUD, a subsidiary of Kajima Corp., will coordinate the project’s design, engineering and construction.

    Coralville Mayor Jim Fausett says he is excited by the agreement and said it ‘‘adds substance to the project.’’

    ‘‘Everybody has put a lot of emphasis on raising money and I believe this agreement helps put the emphasis on the project itself,’’ he said. ‘‘Based on what they are doing in other places and have done, I have a lot of confidence KUD can and will make sure this project gets completed.’’

    The project has $90 million — $50 million from the U.S. Department of Energy, $27 million from the city of Coralville and some from donations. Plans call for seeking a Vision Iowa grant, too, after private funds are raised.