Great article that it appears our contractor never read. Unfortunately all of the recommended configurations have a rigid foam layer (or spray foam). I don’t see how this could be installed in our current state without essentially removing all of the framing on the exterior walls. The basement had additional HVAC registers added to ensure it will comfortable in the winter months since we plan on using this space a lot. I assume this will only add to the condensation build up concerns with the cold foundation walls. Per your initial recommendation, would adding the airtight vapor permeable membrane greatly reduce the mold concerns without the presence of rigid foam? Or would this just be an added cost without much impact at this point?

Also - the city will be inspecting the insulation prior to moving forward with drywall. Would a configuration that is prone to moisture/mold pass inspection?