HomeMy WebLinkAboutFresno Revitalization Corp Canyon CrestNOMW
REPORT TO THE
REDEVELOPMENT AGENCY BOARD
DATE: April 8, 2010
REMN0. V30P *z'D
COUNCIL MEETING: 48/10
nw wo BY
or DiREcroa
FROM: MARLENE MURPHEY, Executive Director Wr//dw.r-
W
BY: JOHN RAYMOND
Assistant Executive Director
SUBJECT:Approve agreements with the Fresno Revitalization Corporation, Inc a California
Non -Profit Corporation and the Non -Prof an of the Agency, for the Acquisition
and Rehabilitation of a 118unit Apartment Complex at 3033 E Plan Avsnue.
EXECUTIVE SUMMARY
Redevelopment Agency Staff recommend Nal the Agency Board approve the attached
Agreements bobveen the Redevelcpmanl Agency of the City of Fresno and the Fresno
Revitalization Corporation, Inc., a California Non -Prof Corporation and the non-profit arm of the
Agency, tar the eoquisibon, operation, and maintenance of a 118 -unit apartment complex located
at 3033 East Plan Avenue in Fresno, near Merged Redevelcpmenl Project Area Na 1. These
agreements would allow the FRC to accept and avrerd of $2,772,253 in Neighborhood
Stabilization Program (-NSP') set-aside turas from the City of Fresno, pursuant to the Housing
and Economic Recovery Ad of 2008. NSP is a subcomponent of the Community Development
Block Grant Program (CDBG) and administered by HUD.
The intent of NSP is to stabilize neighborhoods thmugh the acquisition of foreclosed and
abandoned houses to arrest the dedine in local neighborhoods caused by the national
foreclosure crisis. On March 4, 2010, the City Council approved an NSP substantial amendment
authomang, among other actions, the award of $2,772,253 of NSP sat aside funds to the FRC to
acquire and rehabilitate the 118 -unit muWamily complex As required by HUD, at least twenty.
five percent ($2,772,253) a the total NSP funds received by the City of Fresno are sat -aside for
projects that address the housing needs of very low-income persons. With the creation of
affordability coverents on at least 80% of nre units at the property, this project helps Ite City
meat that requirement.
BACKGROUND
The subject property, called the Canyon Crest Cociominiums, is currently owned by Inland
Mortgage Capital Corporation (°IMCC') of Chicago as the result of a foreGosure of ma previous
owner. Located at 3033 East Plan Avenue, Fresno, CA 93721 (near the sout1mvest tamer of
First And Tulare), it is a 118 unit apartment complex, approximately 90% oeapieci, listed for sale
W a purchase pnca of $4,995,000.
The Agency pursued the subject property as a candidata for the NSP low income and mufti -
family obligation for the following reasons a) them is a limited inventory of foreclosed muiti-
family properties currently on the market for sale; b) this project will satisfy the NSP 25% set
REPORT TO THE REDEVEIAPMENT AGENCY BOARD
Operating Agreement -Fresno RevBeMredon Corporation, Inc.
ADM 8.2010
Page 2
aside in a single action (rather than numerous smaller multi -family properties); c) the project is
90% asset with on-site management already in place; d) the lender's willingness to may
financing for the balance of the purchase price; e) a very quick dosing to meet Me NSP's tight
timing constraints; and, i) the anticipated per unit acquisition Cost of $39,831 makes it very
attractive, espedally when income restrictions are placed upon to units. The subject property,
given its overall condition and occupancy levels, is an ideal Candidate for the City of Fresno's
Neighborhood Stabilization Program and will meet the NSP deadlines in late summer, 2010.
Working with the City Manager an Mayor's offices, the Agency submitted an offer to purchase
the property on February 18, 2010, at a purchase price of $4,700,000, sublets to appraisal,
Agency Board approval and federal NSP guidelines requiring an acquisition Mrough foreclosure
to occur a a Price not to exceed 99% of the appraised value. On February 19, 2010, the Agency
received acceptance of its proposed terms subject to mina refinements.
As Me Agency worked through the deal polms wiM the seller and the City, it was determined that
greater flexibility in Bre use of funs generated by the property for improvements to the property
would be achieved from a structure in which Fresno Revitalization Corporation - Mat qualifies as
an NSP-dwined developer - holds title to Use property. The City an Seller approved this
structure in which the FRC holds title to the property with the Agency serving as Ura Guarantor of
the Sellers loan an Max Operator/Manager of the property through a series of agreements. The
Agency will operate and manage the property in accordance with the Operating and Contractual
Services Agreements YAM Me FRC.
The final appraisal values Me property in -as is' conirm as $4,500,000. The "as is" appraisal
takes into consideration approximately $230,000 for required repairs. Based upon Met value,
adjusted by NSP appraisal guidelines (purchase Prim must not exceed 99% of appraised value),
staff offered a purchase price of $4,445,000 ($4,500,000 x .99 = $4,445,000). Based upon
immediate deferred maintenance of $37,000, an additional adjustment was made for an Adjusted
Purchase Prim of $841,000. The Adjusted Purchase Prim would be payable with $2,480,204
in rash from Me NSP Loan proceeds with the Seller carrying Me balance of $1,07.7%, as a
first trust deed loan, bearing interest at the rate of 6.35% per annum, for a period not to exceed
30 mortis. The difference between the $2,772,253 in total rash available (awarded by the City
Council M the FRC on March 4, 2010) and Me proposed $2,480,204 Cash down peymert
($2,772,253 - $2,480,204 = $292,049) will be used for unit repairs anfor dosing Costs and
maintenance items.
In terms of the agreements between the Agency an FRC, the parties shall enter an Operating
Agreement which contains the requirements to acquire, renovate and maintain the Property,
under which the Agency shall provide FRC a Loan Guarantee of the Sellers Note from IMCC to
assist FRC's acquisition of the Property in an amount not to exceed Two Million Dollars
($2,000,000) (Me 'Agency Guarantee) upon Me tarms and conditions specified in Me Loan
Guarantee. The Agancy shall also provide administrative, firancial an technical support to the
FRC in Me acquisition an operation of the Property through the Contractual Services
Agreement.
REPORT TO THE REDEVELOPMENT AGENCY BOARD
placating Agreement -Frasio RevlleAzatlon Comoation, Inc.
ApN a, 2010
Pepe 3
The Operating Agreement between the Agency and FRC is similar to a development agreement
YAM a private entity, whereby the Agency provides some fans of project assistance (in this case,
a Loan Guarantee) and in realm for the assistance the Owner undertakes actions to compless
the project. Tha second agreement, the Cantradu ll Services Agreement, is where the FRC
'hires back" the Agency to undertake all or most of the tasks the Agency has required of the FRC
under the Operating Agreemem. This structure separates the operating and contractual services
agreements into two documents and would allow the ongoing operational obligations required
through the Regulatory Agreement (exhibit to operating agreement) to slay in place upon the
resale 0 the Property without having to redraft that agreement- e,g. affordability covenants,
maintenance standards, nondiscrimination request.
The agreement also contains a Regulatory Agreement cresting the affordability covenants and
long -tern maintenance and operating restrictions which shall be recorded against and lour with
the Property.
Under this terms of the NSP Agreement with the City of Fresno, at least 60% of ghe units shall be
reserved for households of 50% of Area Median Income ('AMI') or below under the Federal NSP
guidelines, which would be 71 units. Additionally, to meet the public purpose undedying the non-
profit status of the FRC and the Housing Set -Aside requirements of the Agency (as a
consequence of its loan guarantee), the remaining unds net of the manager's unit (an additional
40% of the units (A6 units) shall be restricted to housefwlds of 606 of AMI or below This is the
standard for lower-income rents under Caiffomla Redevelopment Law; 50% of AMI is considered
.very low income' rent.
All of hire units will be caroted toward the Agency's obligations to create a' maintain affordable
housing in Fresno.
Two proforma projections are described below:
Projection 1 assumptions are: (1) the ane -bedroom units are rented at $525 par month; (2) the
two bedroom units are rented at $GA per month; and, 3) that the vacancy/collection loss
amounts to 10%, staff has estimated the net operating income at approximately $332,375 per
year. Assuming annual debt service of $123,050.0.5 ($1,937796 x 0635), the debt service
coverage ratio (DSCR) equates to a significant 2.7. The DSCR is the primary measure to
determine If a property will be able to sustain its debt based an rash flow. In this case, the
project has 2.7 dollars available in cash flow for every dollar needed for debt servico.
Commercial banks typically require a DSCR of only 1.15 -1.35; even in the current conservative
lending dimale DSCRs are still typically less than 1.5; consequently, a DSCR of 2.7 is
eWeardinamy conservative.
Projection 2 assumptions are: (1) the one-bedraan units are rented at $510 and the two-
bedroom units are rented at $575 per month; (2) the va®rwy/collection loss amounts to 10%;
and, (3) the operating expenses are approximately 13% higher than projected, staff has
REPORT TO THE REDEVELOPMENT AGENCY BOARD
Opna MAmeement-Fresno Renlelindan Corporalbn. Inc.
Aqp e, 3010
Pape 4
estimated! the net operating Income at approximately $247,740 per year. Assuming the same
annual debt service of $123,05005 ($1,937,796 x 0635), the debt service coverage ratio
(DSCR) equates to 2.01. Under this scenario, the project hes 2.01 dollars available in cash flow
for every dollar of debt service - still highly extraoNinary for a project of this type.
Far the project to reach a "brwkaven' point at which debt service payments could be made but
whitll there is no positive cash flux, 22 units would have to remain empty for an entire year,
lowering the current occupancy rete from approximately 90% to about 71 %, a significant dropoR
in occupancy considering the current good condition of the project, its location near dovnlown
and the Community Regional Medical Center, and the $292,000 in additional property upgrades
that the RDA on behalf of the FRC xould undertake on Me Property. In addition, those
conservative scenarios project a very low— and hence competitive — rant structure.
The Project has been environmentally assessed (Environmental Assessment No. H-2010-10)
and cues determinetl to be celegaically excluded from review under Secgon 5835 (a) (3) (ii) and
(a) (5) &the National Environmental Policy Act (NEPA) Guidelines. Additionally, the Pmjed has
been assessed under the California Environmental Quality Act (CEQA), resulting in a Categorical
Exemption. Based an the review, City stag detelmirred that the Project is consistent with all oT the
criteria speci(red fa an exemption to the California Environmental Quality Act (CEGA) in
accordance with Section 15301 /Class 1 and 15376(b)(4) of the CEQA Guidelies.
The FRC Board approved the acceptance of the NSP Award in the amount of $2,772,253 from
the City of Fresno. Addessa ly, Me Operating Agreement, and the Contractual Services
Agreement were approved by the FRC Board at a special meeting held on March 18, 2010
subject to the City Attorney's review of Mose document s.
Attachments:
1. Area Map
2. Draft Operating Agreement
3. Draft Contractual Services Agreement
FLar MAP
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This Agreement Is remNed at the request and for the beneft W the City or Fresno and Is exemlet hom the
payment ora reroNing lea pursuant to Gwemment Code section 6103.
pr Rudd
Assistant City Manager
Date: .f2Y//a
ClT OF FRESNO
NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT
by and be (amen
CITY OF FRESNO,
a municipal preparation
and
FRESNO REVITALIZATION CORPORATION
a nonprofit public benefit corporation
regarding
"Canyon Crest Apartments"
APN: 468-390-44s
An Affordable Mulb-Family Apartment Project
r ter•
Recorded at the Request of
and When Recorded Return to:
City of Fresno
Planning and Development Department
Housing and Community Development
ig
Division
a
_
Attention: Housing Manager
"
2600 Fresno Street, Room 3070
Fresno, CA 93721-3605
This Agreement Is remNed at the request and for the beneft W the City or Fresno and Is exemlet hom the
payment ora reroNing lea pursuant to Gwemment Code section 6103.
pr Rudd
Assistant City Manager
Date: .f2Y//a
ClT OF FRESNO
NEIGHBORHOOD STABILIZATION PROGRAM AGREEMENT
by and be (amen
CITY OF FRESNO,
a municipal preparation
and
FRESNO REVITALIZATION CORPORATION
a nonprofit public benefit corporation
regarding
"Canyon Crest Apartments"
APN: 468-390-44s
An Affordable Mulb-Family Apartment Project
r ter•
AGREEMENT BETWEEN THE FRESNO REVITALIZATION CORPORATION AND
THE CITY OF FRESNO REGARDING THE ACQUISITION OF 118 MULTI-FAMILY
HOUSING UNITS
THIS AGREEMENT is made and entered Into, effective the 4th day of March
2010, by and between the CITY OF FRESNO, California, a municipal corporation,
hereinafter referred to as Me "City", and the Fresno Revitalization Corporation of the
City of Fresno, a nonprofit public benefit corporation, hereinafter referred to as the
'DEVELOPER".
RECITALS
WHEREAS, the U.S. Department of Housing and Uman Development,
hereinafter referred M as "HUD", provides funding under Its Neighborhood Stabilization
Program, hereinafter "NSP" as authorized! under Title III of Division B of the Housing
and Economic Recovery Act of 2008, for the purpose of assisting in the redevelopment
of abandoned and foreclosed homes under the Emergency Assistance far
Redevelopment of Abandoned and Foreclosed Homes heading. hereinafter referred to
as the "Act", incorporated herein by its reference; and
WHEREAS, City Is a recipient of NSP funding under the Act for use in funding
eligible activities furthering established national objectives to benefit Its low, moderate
and middle income residents as defined in the Act; and
WHEREAS, the NSP requires no less than twenty, five percent (25%) of Me
CITY's NSP sternal be used for the benefit of households that earn not more than
fifty percent (50%) of Me area median Income, by family size; and
WHEREAS, to advance the supply of Affordable Housing within the City of
Fresno, the CITY desires, among other things, M encourage privateinvestment in the
affordable rental housing market; and
WHEREAS, the City in accordance w@M1 its 2006-2010 Consolidated Plan and
Annual Action Plan, as amended, desires to provide NSP funds in Me amount of Two
Million Seven Hundred Seventy Two Thousand Two Hundred Fifty-Three Dollars
($2,]]2,253) to the DEVELOPER, as more fully described in Exhibit A, Project
Description, upon the terns and conditions In this Agreement; and
WHEREAS, to furtM1er its goal to Increase the supply of Affordable Rental
Housing within the City of Fresno, Me CITY desires to assist DEVELOPER by providing
'a Two Million Seven Hundred Seventy Two Thousand Two Hundred FHty-Three Dollars
($2,]]2,253) deterred payment, zero interest Loan to the Project (hereinafter referred to
as "Loan'), for a term of fifty-five (55) years, for payment of NSP eligible Project casts,
as further identified in Exhibit C (Project Budget and Cash Flow Statement), variously to
be secured by the underlying real property and the Affordable Rental Housing
covenants, upon the terms and conditions in this Agreement, for the acquisition of a
foreclosed 118 -unit multi -family rental housing project, located at 3033 E. Platt Avenue,
Fresno, CA 93721. The Loan will be due and payable at Me earlier of fifty five (55)
years from Me City issued Certificate of Completion or the date upon which he
DEVELOPER has completed payment on other property acquisition lien(s); and
WHEREAS, the City has determined that this Agreement is In he best Interests
of, and will materially contributes to, the Housing Element of the General Plan. Further,
the CITY has found that he Project (i) will have a positive influence in the neighborhood
and surrounding environs, (ii) is in Me vital and best interests of he CITY, and he
health, safety, and welfare of City residents, (iii) complies win applicable federal, state,
and local laws and requirements, including NSP guidelines and NSP national objectives
IN) will increase, improve, and preserve Me community's supply of Low, Moderate and
Middle Income Housing available at affordable housing cost to persdns and families of
Low, Moderate and Middle Income, as defined hereunder, (v) planning and
administrative expenses incurred in sursud hereof are necessary for the production,
improvement, or preservation of Low, Moderate and Middle Income Housing, and (vi)
will comply with any and all owner participation rules and criteria applicable thereto; and
WHEREAS, the CITY and DEVELOPER have determined Mat the NSP Assisted
Units constitutes accord programmatio'grantse lender activities utilizing available and
allocated program/grantee funding, outside the reach of California Consfitution Article
RRXIV and enabling legislation; and
WHEREAS, on February 24, 2010, Me Housing and Community Development
Commission of the City of Fresno reviewed this Agreement and recommended
approval', and
WHEREAS, pursuant to City Resolution No. 2009-153, the City Manager is
authorized to execute, on behalf of the City, NSP agreements that are within available
allocated NSP funding and in a standard forth approved by the City AtMmey; and
WHEREAS, on March 4, 2010, he Fresno City Council provided project approval
AGREEMENT
NOW, THEREFORE, in consideration of he above recitals, which recitals am
contactual in nature, he mutual covenants herein contained and such other and further
consideration as is hereby acknowledged, and subject to the terms and conditions and
provisions hereof, Me parties agree as follows:
1. Definitions. The following. terms have Me meaning and content set forth in this
Article wherever used In this Agreement, attached exhibits or attachments that are
incorporated into this Agreement by reference.
A. "Acquisition' means vesting of Property in fee title to the DEVELOPER.
B. 'ADA" means the Americans with Disabilities Act of 1990, as most recently
amended.
C. 'Affirmative Marketing" means a good faith effort to attract eligible persons
of all racial, ethnic and gentler groups, in Me housing market area, to rent the proposed
Affordable Rental Housing Project, as hereinafter defined.
D. "Affordability Period" means the fifty-fve (55) year period commencing
from the date of Issuance of the Certificate of Completion of the Project Property.
E "Affordable Rental Housing' means all the rental housing units located at
the Project Property, of which seventy one (71) will be NSP assisted units, each of
which will be required to meet the affordability requirements of this Agreement. A total
of forty-six [46] units will be required to meet Me affordability requirements of the
Housing Set Aside Program.
R "Budget" means the Budget, and any changes thereto, approved by the
CITY's Housing and Community Development Division Manager provided the total
amount of NSP Funding allocated to the Project shall not be increased without City
Council approval, attached hereto as Exhibit C.
G. "CeNflcate of Completion" means that certificate issued, In Me form
attached as Exhibit D, to DEVELOPER by the CITY evidencing Me City -approved
completion of the Project for purposes of this Agreement.
H. "CFR" means the Code of Federal Regulations.
I. 'Current Market Appraised Value" means the value of foreclosed upon
NSP or residential property that is established through an appraisal made in conformity
with the appraisal requirements of URA at 49 GFR 24.103 and completed within 60
days prior to a final offer being made for Me property by a grantee, or DEVELOPER.
J. "Declaration of Restrictions" means Me Declaration of Restrictions in Me
form attached hereto as Exhibit B. which shall be recorded against the Property upon
Me close of escrow, fishing out the Affordable Rental Housing covenants and
requirements of this Agreement which shall run with the land.
K. 'Deed of Trust" means that standard, subordinate second (2n) but no
worse than third (3'") position Deed of Trust (including security agreement) given by
DEVELOPER as Trustor, to the CITY as beneficiary, through an escrow established by
DEVELOPER with a City -approved title company, and recorded against the Property,
Insured in the full amount of the Loan, and acceptable to Me City Attorney, as well as
any amendments to, modifications of and restatements of said Dead of Trust. The
terms of any such Deed of Trust are hereby incorporated Into this Agreement by his
reference,
L. "Eligible Costs" means the NSP eligible costs funded by the Loan,
consistent with the Budget attached as Exhibit C. as authorized under Title III of Division
3 of the Housing and Economic Recovery Act of 2008, for be purpose of assisting in
the redevelopment of abandoned and foreclosed homes under the Emergency
Assistance for Redevelopment of Abandoned and Foreclosed Homes, provided,
however, that costs incurred in connection with any activity that is determined to be
ineligible under the Program by HUD or the CITY shall not constitute Eligible Casts.
M. 'Event of Default" shall have the meaning assigned to such term under
Section 36.A.1 hereunder.
N. 'Family' has the same meaning given that term In 24 CFR 5.403.
D. 'Foreclosed" means a property that has been foreclosed upon, and is at
be point that, under state or local law, the mortgage or tax handsome is complete.
P. 'Hazardous Materials" means any hazamme or toxic substances,
materials, wastes, pollutants or confarnhants which are defined, regulated or listed as
"hazardous substances," "hazardous wastes," "hazardous materials." "pollutants,"
"contaminants" or 'toxic substances" under federal or state environmental and health
safety laws and regulations, including without limitation, petroleum and petroleum
byproducts, flammable explosives, time formaldehyde Insulation, radioactive materials,
asbestos and lead Hazardous Materials do not include substances that are used or
consumed in the normal course of developing, operating or ecoupying a housing
project, to the extent and degree that such substances are stored, used and disposed of
In the manner and In amounts that are consistent with normal practice and legal
standards.
D. "Household' means one or more persons occupying a Project Property.
R. -HUD" means the United States Department of Housing and Urban
Development
S. "Loan" means the loan of NSP Funds, In the total amount not to exceed
Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty-Three Dollars
and 00)100 ($2,772,253) for eligible NSP costs, made available by the CIN to the
Project pursuant to this Agreement, as more specifically described in Exhibit A, Project
Description, and as authorized in the Exhibit C, Budget and in the Promissory Note
attached hereto as Exhibit E The Loan shall be payable in accordance with the terms
of the Note, and shall be secured by a Deed of Trust recorded against the property.
T. "Loan Documents" are collectively his Agreement, me Note(s), Directs) of
Trust, Declaration(s) of Restrictions and all related documenarinstruments as may may
be amended, modified or restated from time to time along with all exhibits and
attachments thereto, relative to the Loan.
U. "Neighborhootl Stabilization Program Funds" (also referred to In this
Agreement as "NSP Funds') means the NSP monies constituting the Loan, in an
amount not to exceed the sum of Two Million Seven Hundred Seventy Two Thousand
Two Hundred Fifty -Three Dollars and 00/100 ($2,]]2,253), used for NSP eligible casts.
V. "Prejee means the purchase of one hundred eighteen (118) foreclosed
Affordable Rental Housing Units located at 3033 E. Platt Ave., Fresno, CA 93721, of
which seventy one (71) units will be leased to very low income households, all as
described in due Project Description allaOed hereto and incorporated herein as Exhibit
A.
W. "Project Completion Dale" means the date by which the DEVELOPER has
acquired the Project Property, expended NSP funds on eligible activities In accordance
with this Agreement, and provided the City verification of Me very low income household
status for seventy one (71) housing units in the Project The Project Completion Date
for this project is August 31. 2010.
X. "Preject Property" means Me abandoned and/or foreclosed property to be
purchased by the DEVELOPER according to NSP guidelines, and managed as a mixed
income housing project as provided herein.
Y. 'Project Schedule" means Me schedule for completion of the Project
mounted within the Exhibit A, Project Description and Schedule, consistent with the
above Project Completion Date.
Z. "Promissory Note" means the Project Note In the amount of the total NSP
funs to the DEVELOPER, substantially in the form attached hereto/incorporated herein
as Exhibit E In principal amount of Two Million Seven Hundred Seventy Two Thousand
Two Hundred Fifty Three Dollars ($2,772,253), gNan by DEVELOPER as promisor, in
favor of the CITY, as promisee, evidencing are Loan and performance of the
affordability and other covenants and dandelions set forth in this Agreement, secured by
e standard Deed of Trust as 2"d but no worse than 3nIposition lien upon the Property,
naming the CITY as beneficiary and provided to the CITY no later than the date of initial
disbursement hereunder, as well as any amendments to, modifications of and
restatements of said Note consented to by CITY.
AA. "Rent' means the total monthly payments a tenant pays for a Unit
including the following: use and occupancy of the Unit and land and associated
facilities, including parking (other than parking services acquired by tenants on an
optional basis), any separately charged fees or service charges assessed by
DEVELOPER which are required of all tenants (other than security deposits), the cast of
an adequate level of service for utilities paid by the tenant (including garbage collection,
sewer, water, common area electricity, but not telephone service), any other Interest,
taxes, fees or charges for use of the land or associated facilities and assessed by a
public or private entity other than DEVELOPER, and paid by the tenant.
86. "Revenue" has the same meaning as Program Income, as defined at 24
CFR 570.501 with the modifications as identified In the Federal Register, Volume 73,
No. 194, Docket No. FR -5255-N 01.
CC. "Unit"means a dwelling unit of the Affordable Rental Housing.
DD. 'Very Law Income Families" means families whose annual income does
not exceed fifty percent (50%) of the medlan income for the Fresno, California area as
determined by HUD.
2. Tenn. This Agreement and the NSP grant provided hereunder shall be for he
period commencing upon Ne date of execution, and shall remain in force for the
duration of the longer of the Affordability Period and the Loan unless earlier terminated
as provided herein.
3. Timeframe for Completing Pro'ect
A. DEVELOPER's daily schedule and hours worked under this Agreement on
a given day shall generally be subject to DEVELOPER's discretion and Exhibit A,
provided that DEVELOPER shall devote sufficient time as is reasonably necessary to
fulfill the spirit and purpose of this Agreement. The DEVELOPER agrees to acquire the
Properly with NSP funds and verify verylow income household status for at least
seventy one (71) households within me Project Property, not later then August 31,
2010. Extensions may be granted by the City in Its discretion upon DEVELOPER's
successful completion of the Agreement requirements, and only to allow for the
DEVELOPER's further utilization of Program Income as allowed by HUD and/or In this
Agreement.
8, This Section shall survive termination or expiration of Nis Agreement
4, Loan Terms.
A The City agrees to provide a NSP Loan to the DEVELOPER in the amount
of Two Million Seven Hundred Seventy Two Thousand Two Hundred Fifty -Three Dollars
and 001100 ($2.772,253) for eligible costs, The DEVELOPER shall execute and deliver
to the City the Loan Documents including the Note, and notarized Deed of Trust, for
recordation against the Property.
B. The NSP Loan will be due and payable In accordance with the Note and
not later than the maturity date provided in the Note.
5. Subordination. The Dead of Trust and/or Declaration of Restrictions may be
subordinated to certain approved financing (in each case, a "Senior Loan"), to 2n° but no
worse than 3rd position, but only on mention that all of the following conditions are
satisfied: (a) all of me proceeds of the proposed Senior Loan, less any transaction
casts, must be used to provide acquisition, construction antllor permanent financing for
the Project consistent with an approved financing plan: (b) DEVELOPER must
demonstrate to the CITY's reasonable satisfaction that subordination of the Deed of
Treat and/or Decimated of Restrictions is necessary to secure adequate acquisition,
construction, rehabilitation and/or permanent financing to ensure the viability of the
Project: (c) the subordination agreement must provide the CITY with adequate rights to
cure any defaults by DEVELOPER including providing the CITY or its successor wrM
copies of any notices of default. Upon a determination by the City Manager that Me
conditions In this Section have been satisfied, the City Manager or his/her designee will
be sentenced to execute the approved subordination agreement without the necessity
of any further action or approval, subject to prior approval to forth by the Fresno City
Attorney.
6. No Litigation Material to Financial Condition. DEVELOPER represents and
warrants as of the date hereof that, except as disclosed to and approved by CITY in
writing, no litigation or administrative proceeding before any court or governmental body
or agency Is now pending, nor, to me best of DEVELOPER's knowledge, is any such
Ilfigation or proceeding now threatened, or anticipated against DEVELOPER that, If
obviously determined, would have a material adverse effect on Me financial condition,
business, or assets of DEVELOPER or on the operation of the Project.
7. No Conflict of Mterest. DEVELOPER represents and warrants as of the date
hereof that no official, officer , agent, or employee of the CITY directly or indirectly owns
or controls any interest in DEVELOPER, and no person, directly or indirectly owning or
controlling any interest in DEVELOPER, is an official, officer, agent, or employee of the
CITY.
8. No Legal Bar. DEVELOPER represents and wanants as of the date hereof that
me execution, delivery, performance, or observance by DEVELOPER of this Agreement
will not, to Me best of DEVELOPER's knowledge, materially violate or contravene any
previsions of (a) any existing law or regulation, or any order of decree of any court,
governmental authority, bureau, or agency, (b) governing documents and Instruments of
DEVELOPER: or (c) any mortgage, indenture, security agreement, contract,
undertaking, or other agreement or Instrument to which DEVELOPER is a Party or Mat
is binding on any of its properties or assets, Me result of which would materially or
substantially impair DEVELOPER's ability to perform and discharge itsltheir obligations
of Its/their ability to complete Me Project under this Agreement.
9. No Violation of Law. DEVELOPER represents and warrants as of the date
hereof that, to the best of DEVELOPER's knowledge, this Agreement and the discretion
of the Pmject as contemplated by DEVELOPER, do not violate any existing federal,
state, or local laws or regulations.
10. No Litigation Material to Pro DEVELOPER represents and warrants as of
the date hereof that except as disclosed to, and approved by the CITY in writing, there
Is no action, processing, or investigation now pending, or any basis therefor known or
believed M exist by DEVELOPER that questions the validity of this Agreement, or of any
action to be taken under this Agreement, that would, if adversely determined, materially
or substantially Impair DEVELOPER's ability to pimiento add observe its obligations
under this Agreement, or that would either directly or indirectly have an adverse effect
on or impair Me completion of the Project.
11. Assurance of Governmental Approvals and Licenses. DEVELOPER represents
and warrants, as of the date hereof, that DEVELOPER has obtained and, to the best of
DEVELOPER's knowledge, is in compliance with all federal, state, and local
governmental reviews, consents. authodzatlons, approvals, and licenses presently
required by law to be obtained by DEVELOPER for the Project as of the date hereof.
12. Recording Requirements.
A. DEVELOPER shall provide CITY with the following written performance
reports an or before the dates indicated:
1. From the date of Commencement of the Project, until issuance of
the final Certificate of Completion. DEVELOPER shall submit a Monthly Report, In a
form approved by the CITU, which will include, at a minimum, the following information:
progress of the Project and affirmative marketing efforts (as applicable), and provide a
final report submitted within 45 days of the end of the tams hereof and at any time
hereunder upon written request of the City.
ii. Annually, beginning on Me first day of Me mart following the
CITY's Issuance of the Mal Certificate of Completion, and continuing until the
termination of the Agreement, DEVELOPER shall submit an Annual Report to the CITY,
in a form approved by the CITY. The Annual Report shall include, at a minimum, the
following Information: the rent, Me annual income and the family size of Me Households.
The report shall also state the dale tenancy commenced for each rental Unit,
certification from an officer of DEVELOPER that the Project is in compliance with Me
Affordable Rental Housing Requirements, and such other information the CITY may be
required by law fo obtain. DEVELOPER shall provide any additional information
reasonably requested by the CITY.
Annually, beginning on the first day of Me month following he
CITY's issuance of the final Certificate of Completion, and continuing until the eaplration
of Me Agreement, DEVELOPER shall submit proof of Insurance as required in
Paragraph 47 below.
13. Pr' ct PabhumvP rots d AppraisalR 6
A. DEVELOPER is required to ensure Me purchase of Me Foreclosed -upon
Property be at a minimum discount of one percent (1%) from me current market -
appraised value of the Property.
8. DEVELOPER will be required to perform an appraisal to support their
determination of fair market value, for purposes of calculating the purchase discount.
The appraisal requirement applies to any NSP -assisted acquisition of a foreclosed -upon
home or residential property (including voluntary acquisitions). The appraisal performed
must be in conformity with the appraisal requirements of the URA at 49 CFR 24.103 and
completed within sixty (60) days prior to a final offer being made for the property by the
DEVELOPER. Additional requirements regarding appraisals are included as Exhibit G.
Appraisal Requirements.
14. NSP Funds Disbursement
A. NSP funds shall be disbursed Into escrow to assist the DEVELOPER in
purchasing the Project Property and/or to reimburse DEVELOPER for incurred eligible
rehabilitation costs, In accordance with the Proposed Budget attached hereto as Exhibit
C and incorporated herein, provided that the specific line Item amounts in said Budget
may be varied, added and/or stricken by the City's Housing and Community
Development Division Manager, and further provided that in any event total NSP funds
disbursed in pursuit of said Budget shall not exceed In the aggregate the lesser of the
NSP Loan amount or the CITY'a available and allocated NSP Funding during me term
hereof.
B. NSP funs shall be disbursed only as authorized above, upon verification
satisfactory to CITY that expenses to be incurred in performing the Project are eligible
under the Act, accepting to the following schedule and conditions precedent to
disbursement, as applicable:
1. Upon written request to CITY and within 30 days thereof, provided
Nat CITY's receipt of substantiating invoices, accounts, documents and records for the
disbursement request shall all be express contacted precedent to any payment
obligation by CITY.
ii, Except to the extent expressly provided for herein, all
costs/expenses incurred by DEVELOPER hereunder shall be the sole responsibility and
liability of DEVELOPER.
All funds are paid contingent upon DEVELOPER's continuous
compliance with alt applicable, uniform administrative requirements, program
regulations: and recapture and reversion requirements set out in the Am.
iv. The representations and warranties contained in or Incorporated by
reference in this Agreement continue to be free, complete and accurate.
v. The DEVELOPER has carried out all of Its obligations and Is in
compliance with all the obligations or covenants specified in Mls Agreement, to the
extent that such obligations or covenants are required to have been earned out or are
applicable at the time of the request for the Disbursement.
vi. The DEVELOPER has not com umed or suffered an act, event,
occurrence, or circumstance that constitutes an Event of Default or that with the
passage of time or giving of nonce or both would constitute an Event of Default.
vii. Loan disbursement requested will be used solely for NSP eligible
costs that have been properly Incurred and are properly chargeable in connection with
the Project.
15. Use of Funds. The DEVELOPER shall use the funds provided by Me CITY
solely in pursuh of the Project.
16. Availability of NSP Entitlement Funds. DEVELOPER acknowledges and agrees
that the NSP funding hereunder is subject to the control of HUD and may be
encumbered, withdrawn, or otherwise made unavailable to me CITY (whether earned or
promised to, or by, the DEVELOPER). The DEVELOPER shall not be paid such funds
unless and until they are made available for payment to the CRY by HUD and allocated
and available per CITY Council Action. No other funds owned or controlled by the CITY
shall be obligated under this Agreement unless specifically approved and permitted by
me Fresno CITY Council, Nothing herein constitutes a pledging or obligating of CITY
funds, its General Fund, or any real and personal property taxes, sales taxes or any
other tax revenues. The CITY will provide prompt notice to the DEVELOPER, upon
CITY's notice tram HUD, Indicating NSP funds may be unavailable to the CITY.
17. CynSWcHon Standards
A. DEVELOPER shall rehabilitate Me proposed housing units assisted under
this Agreement in compliance with all applicable local codes, ordinances and zoning
requirements in effect at the time of issuance of Certification of Completion.
B. DEVELOPER, during its lime on We shall maintain Project Properties in a
safe and secure state, while complying with all applicable codes, laws, and ordinances.
18, Identification Signage. The DEVELOPER shall place a poster or sign, identifying
Me City of Fresno, as a Project participant. The sign shall also include the CITY'S
Housing Logo, as well as the Equal Housing Opportunity logo, as mandated by HUD.
The posterlsign shall be appropriately placed, and shall be in place for 5 months
following Property acquisition.
19. Contracts and Subcontracts. Consistent with this Agreement, all demo06on,
hazardous waste abatement, consbucbon work and professional services for the Project
shall be performed by persons or shall licensed or otherwise legally aumorized to
perform the applicable work or service in the Spite of California and the City of Fresno.
The DEVELOPER shall require that each contractor and subcontractor agreement
contain a provision whereby the party(les) to the agreement other then the
DEVELOPER agree to (p notify the CITY immediately of any event of default by the
DEVELOPER thereunder; (II) notify the CITY Immediately of the filing of a mechanic's
lien. (Iii) notify the CITY Immetliately of termination or cancellation of to agreement,
and (iv) provide the CITY, upon the CITY's request, an Estoppel Certificate ceNfying
Nat the agreement is In full fares and affect and the DEVELOPER Is not in default
thereunder. The DEVELOPER agrees to notify the CITY immediately of termination or
cancellation of any such agmement(s), notice of filing of a mechanic's lien, or breach or
default by other party(ies) thereto.
20. Apchan'c's Liens and Stop Notices.
A. It any claim of lien Is filed against the Property or a stop notice affecting
any financing, NSP Fonds or Funding Sources for the Project is served on the CITY or
any other third party in connection with the Project, the DEVELOPER shall, within
Wanly (20) days of such filing or service, either pay and fully discharge the lien or stop
notice, effect the release of such lien or stop notice by delivering to the CITY a surety
bond In sufficient forth and amount, or provide the CITY with other assurance
satisfactory to Me CITY Mat the claim of lien or stop notice will be paid or discharged.
B. If Me DEVELOPER fails to discharge, bond or otherwise satisfy the CITY
with respect to any lien, encumbrance, charge or claim referred to in this Section, then,
in stickler to any other right or remedy, the CITY may, but shall not be obligated to,
discharge such lien, encumbrance, charge, or claim at the DEVELOPER expense.
Alternatively, the CITY may require the DEVELOPER to immediately deposit with the
CITY the amount necessary to satisfy such lien or claim add any costs, pending
resolution thereof. The CITY may use such deposit to satisfy any claim or lien that is
adversely determined against the DEVELOPER. The DEVELOPER hereby agrees to
Indemnify and hold Me CITY harmless from liability for such liens, encumbrances,
charges or claims together with all related costs and expenses.
21. Permits and Licenses. Upon CITY's reasonable request, and as applicable, the
DEVELOPER shall submit, for CITY approval, all Me necessary permits and licenses
required for Commencement of Cemsbuctlon. As the CITY may reasonably request the
DEVELOPER, at its sole cost and expense, shall provide to the CITY copies of any and
all permit approvals and authonizations including plat plan, plat, zoning variances,
sewer, building, and other permits required by governmental authorities other Man the
CITY In pursuit of the Affordable Rental Housing Project, and for its stated purposes In
accordance with all applicable building, environmental, ecological, landmark,
subdivision, zoning codes, laws, and regulations. The DEVELOPER is responsible, at
Its sole cost and expense, to determine the location of any raises on the Property and
to negotiate with the utilhy companies for and In relocate Me utilities, if any, as
necessary to complete Me Project.
22, Fees. Taxes and Other Levies. The DEVELOPER shall be responsible for
payment of all fees, assessments, taxes, charges and levies Imposed by any public
authority or utility company with respect to the Property or the Project, and shall pay
such charges prior to delinquency. However, the DEVELOPER shall not be required to
12
pay and discharge any such charge so long as; (a) me legality thereof is being
contested diligently and in goad faith and by appropriate proceedings, and (b) if
requested by the CITY, the DEVELOPER deposits with the CITY any funds of other
farms of assurances that the CITY, In good faith, may determine from tlme to time are
appropriate to protect the CITY from the consequences of the contest being
unsuccessful.
23. Covenants and Restrictions to Run with the Land.
A. The CITY and DEVELOPER expressly warrant, covenant and agree to
ensure that the covenants and restrictions set form In this Agreement are recorded and
will run with the land, provided, however, that, on expiration M this Agreement and the
Affordable Rental Housing requirements therein, said covenants and restrictions shall
expire. DEVELOPER further wi mants, covenants and agrees to ensure that the.
covenants and restrictions set forth herein shall run in favor of the CITY.
B. The CITY and DEVELOPER hereby declare their understanding and
Intent that the covenants and restrictions set forth herein directly benefit the land (a) by
enhancing and increasing the enjoyment and lease of the proposed Project by certain
Very Low Income Families, and (b) by making possible the obtaining of advantageous
financing for acquisition.
C. The DEVELOPER covenants and agrees that until the expiration of Ne
Affordability Period it shall cause the Affordable Rental Housing to be used for
Affordable Housing.
O. Without waiver or limitation, me CITY shall be entitled to injunctive or other
equitable relief against any violation or attempted violation of any covenants and
restrictions, and shall, in addition, be entitled to damages available under law or
contract for any Injuries or losses resulting from any violations thereof.
E. All present and future owners of Me Affordable Rental Housing and other
persons claiming by, through, or under them shall be subject to and shall Comply Wim
the covenants and resMGions. The acceptance of a deed of conveyance to the
ABortlable Rental Housing shall constitute an agreement that the covenants and
restrictions, as may be amended or supplemented from Omer to Sme, are accepted and
ratified by such future owners, tenant or occupant, and all such covenants and
restrictions shall be covenants running with the land and shall bind any person having at
any time any interest or estate in the Affordable Rental Housing, all as though such
covenants and restrictions were recited and stipulatetl at length In each and every deed,
conveyance, mortgage or lease thereof.
F. The failure or delay at any time of Me CITY or any other person entitled to
enforce any such covenants or restrictions shall in no event be deemed a waiver of the
same, or of the right to enforce the same at any time or from time to time thereafter, or
an estoppel against the enforcement thereof.
24. Displacement of Persons. DEVELOPER warrants, covenants and agrees that It
will take all reasonable steps to minimize the displacement of any persons (families,
individuals, businesses, nonpreft organizations and farms),
25. Initial and Annual Income Certification. DEVELOPER warrants, covenants and
agrees that it shall comply with the procedures for annual income determinations as set
forth by the U.S. Department of Housing and Urban Development for me Neighborhood
Stabilization Program. DEVELOPER shall obtain, complete and maintain on file,
immediately prior to initial occupancy, and annually thereafter, Income certifications
from each tenant Household renting any Unit. DEVELOPER shall make a good faith
effort to verify that the income provided by an applicant or occupying Household in an
income certification is accurate by taking one or more of the following steps as part of
Me verification process. (1) obtain a pay stub for the most recent pay paring (2) obtain
an Income verification forth from theapplicant's cement employer: (3) obtain an income
verification form from the Social Security Administration and California Department of
Social Services if the applicant receives assistance from either of such agendas; (4)
obtain an Income tax return for the most recent tax year, or (5) if the applicant is
unemployed and has no such but return, obtain another form of independent
verification. Copies of household income certification and verification must be available
for review and approval by the CITY. DEVELOPER further warrants, covenants and
agrees that It shall cooperate with the CITY in the CITY's income
certificationlaffordabilgy monitoring adNlties.
26. Lead -Based Point. The DEVELOPER warrents, covenants and agrees that it
shall comply with all applicable requirements of the Lead Based Paint Poisoning
Prevention Act of 42 U.S.C. 4821 at seq., 24 CFR Part 35 including the HUD 1012 Rule,
and 24 CFR 982.4016), including any amendments thereto, in the Affordable Housing
Project These requirements apply to all units and common areas in the Project
Property. DEVELOPER shall incorporate or cause incorporation of this provision In all
contracts and subcontracts for work performed on the Project, which involve the
application of paint. DEVELOPER shall be responsible for all disclosure, inspection,
tasting, evaluation, mnwl and abatement activities.
27. Affordable Rental Housing
A. DEVELOPER covenants and agrees that Ne Project shall constitute
Affordable Ransil Housing with at lead seventy one (71) units preserved as Very Low
Income Rental Housing during the entire Affordability Period. This covenant as to
Affordable Rental Housing shall remain In effect and run with and restrict the land during
the entirety of the Affordability Pericd. In the event that DEVELOPER falls to comply
with the time period in which me Project must constitute Affordable Rental Housing,
CITY shall without waiver or limitation be entitled to injunctive relief, as DEVELOPER
acknowledges that damages are not an adequate remedy at law for such breach.
28. Compliance with Environmental Laws
A. The DEVELOPER shall cause the Project to be in compliance with, and
not to cause or permit the housing project to be in violation of, any environmental law,
rule, regulation, ordinance, or statute. Although the CITY may utilize its employees and
agents for regular inspection and testing of the eligible Property, the DEVELOPER
agrees that, if the CITY has reasonable grounds to suspect any such violation, the
DEVELOPER shall be entitled to thirty (30) days' notice and opportunity to cure such
violation. If the suspected violation is not cured, the CITY shall have the right to retain
an Independent consuflant b inspect and test the eligible Property for such violation. If
a violation is discovered, the DEVELOPER shall pay far the reasonable cost of the
independent consultant.
B. Additionally, the DEVELOPER agrees:
1. That the CITU shall not be directly or Indirectly Involved with the
Inspection , testing, removal or abatement of asbestos or other hazardous or toxic
chemicals, materials, substances, or wastes and Nat all cost, expense and liability for
such work shall be and remain solely wit the DEVELOPER; and
ii. Not to transport to or from the proposed project site(s), or use,
generate, manufacture, produce, stare, release, discharge, or dispose of on, under, or
about the project still or surrounding real estate, or transport to or from the project
site(s), or surrounding real estate, any hazardous or toxic chemicals, materials,
substance, or wastes or allow any person or entity to do so except in such amounts and
under such terms and conditions permitted by applicable laws, miss, regulations,
ordinances, and statutes; and
iii. To glue prompt written notice to the CITY of the following:
i. Any procall or inquiry by any governmental authority
with respect to the presence of any hazardous or toxic chemicals, materials, substance,
or waste in or on the eligible Property or Ne surrounding real estate or the migration
thereof from or to other property;
2. All claims made or threatened by any third party against the
DEVELOPER or such properties relating to any lass or injury resulting from any
hazardous or toxic chemicals, materials, substance, or waste; and
3. The DEVELOPER's discovery of any occurrence or
condition on any real property adjoining or in the vicinity of such trophies that would
rause such properties or underlying or surrounding real estate or pan thereof to be
subject to any restrictions on the ownership, occupancy, transferability, or use of the
property under any environmental law, rule, regulation, ordinance or statute; and
4. To Indemnity, defend, and hold the CITY harmless from any
and all claims, actions, causes of action, demands, judgments, damages, injuries,
administrative orders, consent agreements, orders, liabilities, penalties, costs, expenses
(including attorney's fees and expenses), and disputes of any kind whatsoever arising
out of or relating to the DEVELOPER or any other parry's use or release of any
hazardous or toxic chemicals, materials, substance, or wastes on the eligible Property
regardless of cause or origin, including any and all liability arising out of or relating to
any investigation, site monitoring, containment, cleanup, removal, restoration, or other
remedial work of any kind.
29. Cifirdficale of Completion Upon completion of the acquisition of the Project,
DEVELOPER shall certky In writing to the CITY that the Affordable Rental Housing has
been acquired Upon completion of the Affordable Rental Housing, DEVELOPER shall
also submit to the CITY a cost-ceNfying final budget where DEVELOPER shall identify
the actual costs of construction of the Project. This final cost -certification shall identify
costs in line -item format, consistent with the Project Budget. Upon a determination by
the CITY that DEVELOPER Is In compliance with all of DEVELOPER construction
obligations, as specified in this Agreement, the CITY shall furnish, within 30 Islander
days of a written request by DEVELOPER, a recordable Certificate of Completion for
the Project In the form attached hereto as Exhibit D, The CITY will not unreasonably
withhold or delay furnishing the Certificate of Completion. If the CITY fails to provide
the Certificate of Completion within the specified time, it shall provide DEVELOPER with
a written statement Indicating in what respects DEVELOPER has failed to complete the
Project in conformance with this Agreement or has otherwise failed to comply with the
terms of this Agreement, and what measures DEVELOPER will need to take or what
standards it will need to meet in order to obtain the Cerdficate of Completion. Upon
DEVELOPER taking the specified measures and meeting the specified standards,
DEVELOPER will cortify to the CITY in writing of such compliance and the CITY shall
deliver the recordable Certificate of Completion b DEVELOPER in accordance with the
Provisions of this section.
30. Products Management
A. Operation of the Pro'ect. DEVELOPER shall lease, operate and manage
the Project in full conformity with the terms of this Agreement.
B. Occupancy Requirements. Seventy One (71) Project Units shall be rented
and occupied by, or IT vacant, available for rental occupancy by (a) persons) whose
annual household Income at the time of initial occupancy is not greater than fifty Percent
(50%) of the most recent annual median income, calculated and Published by HUD for
me Fresrw Metropolitan Statistical Area, applicable to such household's size, and at an
affordable price, for me Affordability Period, except upon foreclosure by a lender or
transfer in lieu of foreclosure following default under a Dead of Trust. However, if at any
fime fallowing transfer by foreclosure or transfer in lieu of foreclosure, but sill during the
Affordability Period, the owner of record poor to the foreclosure or transfer in lieu of
foreclosure, or any newly formed entry that includes such owner of record or those
whom such owner of record has or had family or business ties, obtains an ownership
interest in the Project or Property, the Affordability Period shell be revived according to
its original terms. In the event DEVELOPER fails to comply with this Section or me
Affordability Periotl is not revived following transfer by foreclosure or transfer in lieu of
foreclosure, DEVELOPER shall return to CITY all NSP Funds disburses to
DEVELOPER by CITY. Affordable rents will be set at HUD fair market rents, and will
not exceed thirty-five percent (35%) of me tenant's household income, including utilities,
far the tens of this Agreement. Forty Six (46) Project Units shall be required to meet the
affordable housing income restrictions as required by the Housing Set Aside program.
C. Leasing the Pro'ect. Before leasing any Units, DEVELOPER shall submit
its proposed form of Lease for GITY's review and approval. DEVELOPER covenants
and agrees to utilize only Leases that have been approved In advance by CITY. The
CITY shall respond to DEVELOPER submission of a sample Lease within Unity (30)
days. Should CITY not respond within thirty (30) us" of Lease submihal, DEVELOPER
shall be authorized to use the submitted sample Lease. Additionally, DEVELOPER
agrees not to terminate Me tenancy or to refuse to renew a Lease with a tenant of the
Affordable Rental Housing Striated with NSP Funds except for serious or repeated
violation of the teens and conditions of me Lease, for violation of applicable federal,
state, or local law, or for other good cause. My such termination or refusal renew
must be preceded by not less man 30 days written notice served by DEVELOPER or Its
authorized management entity upon the tenant specifying the grounds for such action.
DEVELOPER agrees it shall annually report 0 CITY me number of Leases that were
trot renewed or terminated and the reason for such non -renewal or termination.
D. Lease Provisions. Leases are subject to the following:
I . DEVELOPER shall include in Leases for all Units, provisions which
authorize DEVELOPER to Immediately terminate the tenancy of any Household one or
more of whose members misrepresented any fact material to me Households
qualification as a Household for Very Low -Income Families. Each such Lease shall also
provide that the Household Is subject to annual certification, and mat, if the Household's
annual income increases above the applicable limits for Very Low -Income Families such
Household a rent may be subject to Increase to the lesser of (1) the amount payable by
tenant understate or local law or (2) thirty-five percent (35%) of the Household's actual
adjusted monthly income.
E. Final Management Plan. Within sixty (60) calendar following property
purchase, DEVELOPER shall submit to the CITY, for review and approval, a plan for
marketing and managing the proposed Affordable Rental Housing ("Final Management
Plan'), The Final Management Plan shall address in detail how DEVELOPER or its
designated management entity plans to market me availability of Units to prospective
tenants and how DEVELOPER plans to certify the eligibility of potential tenants. The
Final Management Plan shall also address how DEVELOPER and/or the management
entity plan to manage and maintain the Affordable Rental Housing, and shall include
appropriate financial information and documentation. The Final Management Plan shall
17
contain detailed descriptions of policies and procedures with respect to tenant
selections and evictions. Topics to be covered in these procedures shall Include at a
minimum the following:
Interviewing procedures for prospective tenants;
Previous rental history of tenants with references,
Credit reports and checks;
Criminal background checks',
Deposit amounts, purpose, use and refund policy;
Employmentllncome verification',
Occupancy restrictions;
Income Limits
Equal Housing Opportunity Statement,
Restrictions on use of the premises; and
TenanVLandiord dispute resolution procedures.
I. The Final Management Plan shall contain copies of all standardized
fortes associated with the above listed topics. The Final Management Plan shall include
a form Lease agreement that DEVELOPER propose to enter into wit Project tenants.
DEVELOPER shall abide by the terns of this Final Management Plan, approved by to
CITY, In marketing, managing and maintaining the Housing.
ii. At least ninety (90) calendar days prior to to Project Completion
Data DEVELOPER shall also submit any proposed management contract to to CITY
for prior review. The CITY shall have the right to review any proposed amendments,
other tan renewals to the management contract, and any new management contracts
during the term of this Agreement Such management contrad(s) shall contain a
provision expressing this right.
F. Property Management With respect to the Project, DEVELOPER shall
comply wit to following:
( Management Responsibllifies. DEVELOPER directly andlor
trough its designated management entity, is speofically responsible for all
management functions with respect to the Affordable Rental Housing Project Including,
without limitation, the selection of tenants, certification and re -certification of Household
size and income, evictions, collection of Rents and deposits, construction management.
affirmative marketing, maintenance, landscaping, routine and extraordinary feature,
replacement of capital Items and security. The CITY shall have no responsibility for
such management of the Project.
G. Maintenance and SecunN. DEVELOPER shall at its own expense
maintain the Affordable Rental Housing in good condition, in good repair and In descent,
safe, sanitary, habitable and tenantable living conditions for the benefit of to Unit
occupants. DEVELOPER shall not comm t or permit any waste on of to the Affordable
IN
Rental Housing, and shall prevent and/or rectify any physical deterioration of the
housing. DEVELOPER shall maintain the housing In conformance with all applicable
federal, state and local laws, ordinances, codes and regulations, the Final Management
Plan, and this Agreement.
H. Damage to Provertv. To the extent consistent with the requirements of
any permitted encumbrance, or as otherwise approved by the CITY, and subject to Me
insurance requlremeols of this Agreement, if any building or improvement constructed
on the Property is damaged or destroyed by an insurable cause, DEVELOPER shall, at
its cost and expense, diligently undertake to repair or restore said buildings and
improvements consistent with the original Plans and SahifCatlons of the Project Unit.
Such work or repair shall commence within ninety (90) days after Me insurance
proceeds are made available to DEVELOPER and shall be complete within one (1) year
thereafter. All insurance proceeds collected for such damage or destruction shall be
applied to the cost of such repairs or restoration and, if such insurance proceeds shall
be insufficient for such purpose. DEVELOPER shall make up the deficiency.
I. Nondiscrimination. All of the Units shall be available for occupancy on a
continuous basis to members of the general public who afeincome eligible.
DEVELOPER shall not illegally discriminate or segregate in the development,
construction. use, enjoyment, occupancy or conveyance of any part of the Affordable
Rental Housing Project or Property on the basis of ram, color, ancestry, national origin,
religion, sex, age, marital status, family status, source of income/rental assistance
subsidy, physical or mental disability, Acquired Immune Derdency Syndrome (AIDS) or
AIDS-related conditions (ARC), sexual orientation, or any other arbitrary basis.
DEVELOPER shall otherwise comply with all applicable local, stale and federal laws
concerning nondiscriminatlon in housing. Neither DEVELOPER nor any person
claiming under or through DEVELOPER, shall establish or permit any such macros or
practices of illegal discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants or vendeas of any Unit or In connection with
employment of persons for the construction of any Unit. All deeds or contracts made or
entered into by DEVELOPER as to the Units or the housing project or portion thereof,
shall contain coants concerning nondiscrimination consistent with this section.
DEVELOPER shall Include a statement in all advertisements, notices and signs for
availability of Units for rent to the effect that DEVELOPER is an Equal Housing
Opportunity Provider.
A- Nothing in this section is intended to require DEVELOPER to
change Me character, design, use or operation of the Project: or to require
DEVELOPER to obtain licenses or permits other than those required for Me Project.
J. Rent Schedule and Utility Allowances. DEVELOPER covenants and
agrees not to charge rent for Units in an amount which exceeds those rents as
established by HUD to be fair market rent for the Fresno, California area and fuller
covenants and agrees not to Impose a monthly allowance for utility services to tenants
of such Units In excess of an amount approved by HUD in accordance with 24 CFR
19
92.252. DEVELOPER agrees to human to the CITY a certificate setting farm the
maximum monthly rentals for Units and the monthly allowances for utilities and services
to be charged during any annual perod until Me expiration of Me Affordability Period.
K. Fees Taxes and Other Levies. DEVELOPER shall be responsible for
payment of all fees, assessments, taxes, charges and levies Imposed by any public
authority or utility company with respect to the Propel or Me Project, and shall pay
such charges pror to delinquency. However, DEVELOPER shall not be required N pay
and discharge any such charge so long as'. (a) the legality thereof is being contested
diligently and in good faith and by appropriate proceedings, and (b) if requested by Me
CITY, DEVELOPER deposit with Me CITY any funds or other forms of assurances that
the CITY, In good faith, may determine from time to time are appropriate to protect the
CITY from Me consequences of the contest being unsuccessful.
L. FOJ intim. DEVELOPER shall promptly inform the CITY of any new
financing or funding, and DEVELOPER shall provide the CITY copies of all agreements
with any and all Funding Sources for this Project. DEVELOPER agrees to notify the
CITY Immediately of termination or cancellation of any such agreements) or receipt of
notice of defauitidef not thereunder. DEVELOPER shall comply with all obligations of
any such agreement(s) with any and all Funding Sources until the respective expiration
of such agreement(s). In Me event DEVELOPER fails to comply with its obligations of
MIs section, the loan shall become immediately due and payable as provided for In this
Agreement. This section shall survive expiration or termination of this Agreement.
31. Financial Statements and Adults
A. The DEVELOPER, as a recipient of federal financial assistance, Is
required to comply with the provisions of the Single Audit Act of 1984 (31 U.S.C.
Sections 7501 at seq.), as amended. Annually, within one hundred and eighty (180)
days following: 1) the end of fiscal years) In which Me NSP Funds are disbursed
hereunder, and 2) the end of fiscal years) in which this contract shall temunale, and
otherwise upon Me City's, written request during the tens of this Agreement,
DEVELOPER, at its sole cost and expense shall submit to Me City:
Audited annual financial statements that are current, signed, and
prepared according b generally accepted accounting principles consistently applied
(except as ethereal disclosed thereln); and
It. Audited Finarmal Statements covering the income and expenses,
and the financial transactions for Me Project during the prior fiscal year.
32. Inspection and Audit of Books Records and Documents.
A. The DEVELOPER shall be accountable to the CITY for all NSP Funds
disbursed for Me project pursuant to this Agreement. Any duly authorized
representative of the CITY, the State, or HUD shall, at all reasonable times, have
20
access to and the right to inspect, copy, make excerpts or transcripts, audit, and
examine all books of accounts, records, files and other papers or property, and other
documents of the DEVELOPER pertaining to the Project or all matters covered in this
Agreement and for up to five (5) years after the aspirated or termination of this
Agreement.
B, The DEVELOPER will maintain books and records for the Project using
generally accepted accounting principles. The DEVELOPER agrees to maintain books
and records that accurately and fully show the date, amount, purpose and payee of all
expenditures financed with NSP Funds and to keep all invoices, receipts and other
documents related to expenditures financed with NSP Funds for not less than five (5)
years after the expiration or termination of the Agreement. Books and records must be
kept accurate and current. For purposes of this section, "books, records and
documents' include, without limitation; plans,drawings, specifications, ledgers, journals,
statements, contracts agreements, funding information, funding applications, purchase
orders, invoices, loan documents, computer printouts, correspondence, memoranda,
and electronically stored versions of the foregoing. This section shall survive the
termination of this Agreement.
C. The CITY may audit any conditions relating to this Agreement at the
CITY's expense, unless such audit shows a significant discrepancy in information
reported by the DEVELOPER in which case the DEVELOPER shall bear the cost of
such audit This section shall survive me termination of this Agreement.
O. The DEVELOPER will cooperate fully with the CITY, the State, and HUD
in connection with any interim or final audit relating to the Programs and the Project that
may be performed relative to the performance of this Agreement.
33. Inspection of Property. Any duly auNodzad representative of the CITY, the
State, or HUD shall, at all reasonable times, have access and the right to inspect due
Properly until completion of the Project.
39. No Other Liens. The DEVELOPER shall not create or incur, or suffer to be
created or incurred, or to exist, any additional mortgage, pledge, encumbrance, Ilen,
charge, or other security interest of any kind on the eligible Pmparty, other than inose
related to construction or pre -development loans in relation to the Affordable Housing
Project consistent with the attached Exhibit C Project Budget, without the prior written
consent of the CITY.
35. Payment of Liabilities. The DEVELOPER shall pay and discharge In the ordinary,
course of its business all material obligations and liabilities, the nonpayment of which
could have a material or adverse Impact on its financial conciliar business, or assets or
on the operation of the Prclect(s), except such obligations and liabilities that have been
disclosed to the CITU in writing and are being contested in goad faith.
36. Termination of AcreemenL
A. This Agreement shall terminate upon the earlier of:
I. DEVELOPER's Default. The pates agree that each of the
fallowing shall constitute a default by DEVELOPER for purposes of this Agreement
where such breach remains uncured for thirty (30) calendar days following City's notice
to DEVELOPER describing such breach, or if such breach Is not reasonably susceptible
of cure, immediately upon notice of breach by City to DEVELOPER:
1. The DEVELOPER'S use of NSP funds for other uses than
describetl In the Scope of Work.
2. The DEVELOPER's failure to obtain and maintain the
insurance coverage required under this Agreement.
3. Except as otherwise provided in His Agreement, the failure
of the DEVELOPER to punctually and properly perform any other covenant or
agreement contained in this Agreement including without limitation the following:
a. Failure M meet padonnance measures and schedule.
b. Any representation, warranty, or certificate given or
furnished by or on behalf of DEVELOPER shall prove to be materially false as of the
date of which the representation, womanly, or certificated was given, or Mal
DEVELOPER concealed or failed to disclose a material fact to City, provided, however,
that If any representation, warranty, or certification Mat proves to be materially false is
due merely to DEVELOPER's inadvertence, DEVELOPER shall have a thirty (30) day
opportunity after written notice thereof to cause such representation, warranty, or
verification to be tree and complete in every respect.
C. DEVELOPER shall file, or have filed against it, a
petition of bankruptcy, Insolvency, or similar law, state or federal, or shall file any
petition or answer seeking, consenting to, or acquiescing in any reorganization,
arrangement, composition, readjustment liquidation, dissolution, or similar relief, and
such petition shall not have been vacated within fourteen (14) days', or shall be
adjudicated bankrupt or Insolvent, under any present or future statute, law, regulation,
under state or federal law, and such judgment or decree is not vacated or set aside
within fourteen (14) days
J. DEVELOPER's failure, inability or admission in writing
of its Inability to pay its debts as they become tlue or DEVELOPER'S assignment for me
benefit of creditors.
22
e. A receiver, trustee, or liquidator shall be appointed for
DEVELOPER or any substantial part of DEVELOPER's assets or properties, and not be
removed within ten (10) days.
f. DEVELOPER's breach of any other material
condition, covenant, warranty, promise or representation contained in this Agreement
not otherwise identified within his section.
fl. Written notice by either party to the other without cause.
III, Complete performance by each parry hereto.
iy Expiration.
B. Upon the happening of a default by DEVELOPER and a failure to cure
said default within 30 days of the date of the notice of default (or a more immediate date
H the default is related M imminent health and/or safety concems). City obligation to
disburse NSP funding shall terminate, and City may also at its option and without notice
institute any action, suit, or other proceeding in law, in equity or otherwise, which it shall
deem necessary or proper for the protection of Its Interests and may without limitation
proceed with any or all of the following remedies in any order or combination City may
choose in Its sole discretion:
L Terminate Otis Agreement immediately upon written notice m
DEVELOPER, in which event any unearned and improperly NSP funds disbursed to
DEVELOPER by City shall be returned to City;
Bring an action in equitable relief (1) seeking specific performance
by DEVELOPER of Me terms and conditions of Nis Agreement, and/or (2) enjoining,
abating or preventing any violence of said terms and conditions, anther (3) seeking
declaratory relief,
III, Pursue any other remedy allowed at law or In equity or under this
Agreement.
C, Upon any termination, the City's obligations hereunder shall terminate and
all unexpended or improperly expended NSP funds subject to This Agreement shall
revert to andlor be recaptured for the City's NSP Program, provided that if the
DEVELOPER Is not in default at the time of termination the DEVELOPER shall be
reimbursed for eligible project activities satisfactorily performed prior to the effective
date of the notice of termination.
0. Nolwimstanding me foregoing and without waiver or limitation, in
accordance with the Act including 24 CFR 65.43. suspension or termination of this
Agreement may occur if the DEVELOPER materially fails to comply with any term of the
23
NBP grant, and the grant may be terminated for convenience in accordance with 24
CFR 85.44.
E. Those provisions of this Agreement Intended by its terms therein to
survive the termination of this Agreement shall so survive.
37. On -Site Monitoring. Authorized representatives of HUD or the City shall have the
right to monitor the DEVELOPER's performance under this Agreement. Such
monitoring may Include inspection activities, review of records, and abandoned at
meetings.
38. Records.
A. The DEVELOPER shell maintain all necessary books and records with
respect to disbursement of money, In property, and to personnel in accordance with
usual and customary business accounting practices. The DEVELOPER shall document
all DEVELOPER expenditures under this Agreement wit properly executed payroll,
time records, invoices, contracts, vouchers, or other official documentation evidencing
the nature and propdery of to charges. All such materials shall be retainetl by the
DEVELOPER for a period of not less than five (5) years from termination of this
Agreement.
B. The DEVELOPER shall, at such time and in such forms as the City or
HUD may require, furnish statements, records, data, copies, and information pertaining
to matters covered by this Agreement. The City has to right, upon request, to inspect
and copy all DEVELOPER documents and records pertaining to this Agreement.
39. Compliance with Governmental Regulations.
A. The DEVELOPER shall, at its sole cost and expense, comply with
applicable municipal, county, state, and federal law, regulations, rules and requirements
now In force, or which may hereafter be in force, pertaining to any and all activities
under this Agreement. The DEVELOPER shell comply with all applicable provisions of
24 CFR 570, et seg„ including Subpart K thereof, except that the DEVELOPER does
not assume to CITY's non -delegable environmental responsibillFes described In 24
CFR 58 andlor 24 CFR 570-604, and does not assume the City's responsibility for
initiating Ne review, process under Executive Order 12372.
I. Both City and DEVELOPER agree to jointly and severally comply
with the requirements of to Office of Management and Budget Circular A-87, "Cast
principles for State, Local, and Indian Tribal Governments"; OMB Circular A-133"Audits
W States; Local Governments and Non -Profit Organizations"; 24 CFR Part 85 "Uniform
Administrative Requirements for Grants and Cooperative Agreements to State and
Local Governments"; and 24 CFR Part 570.502 "Applirabllity of Uniform Administrative
Requirements". Each parry shall be responsible for determining the applicability of the
foregoing.
it. The DEVELOPER agrees to comply with all applicable
requirements of Section 50v[ of the Rehabilitation Act of 1973 and HUD Implementing
regulation 24 CFR Part B.
40. Pre act Responsibilities/Public Worlix-P 'I' Wage Requirements
DEVELOPER shall be solely responsible for all aspects of DEVELOPER's conduct in
connection with the Project, including but not limited to, compliance with all local, state
and federal laws Including, without limitation, as to prevailing wage and public bidding
requirements, as applicable. This Project is a'public work" project for federal purposes
including Davis Bacon and Related Acts wage requirements absent writlen
directionldelerminabon otherwise by U.S. HUD or a court of competent jurisdiction.
Based thereon DEVELOPER shall cause the Project work to be performed as a'public
work". The Council of the City of Fresno has adopted Resolution No. 82-291
ascertaining the general prevailing rate of per diem wages antl per diem wages for
holidays and overtime in the Fresno area for each craft classlficatlon, or type of
workman needed in the execution of contacts for the City. A copy of the resolution is
on file at the Office of the City Clerk. Actual wage schedules are available upon request
at the CITY's Construction Management Office. Without limiting the foregoing,
DEVELOPER shall be solely responsible for the quallty and suitability of the work
completed, the supervision of all contracted work, qualifications and financial conditions
of and performance of all contractors, subcontractors, consultants and suppliers. Any
review or inspection undertaken by the CITY with reference to the Project and/or payroll
mondonnglauditing is solely for me purpose of determining whether DEVELOPER is
properly discharging as obligation to the CITY, and shall not be relied upon by
DEVELOPER or by any third parties as a warranty or representation by the CITY as to
governmental compliance and/or the quality of the work completed for the Project
41. Contact Award
A. The DEVELOPER will be responsible for all aspects of the project contract
award and management Including any. compliance with all applicable laws and
regulations. The DEVELOPER shall verify with the Labor Relations and Equal
Opportunity Divislon of the U.S. Department of Housing & Urban Development (HUD)
Area Office that any low bidder has not been debarred or suspended tam participating
in the federal project
1. Any such award shall be subject to all the terms and conditions
herein.
42. Accessibility
A. The DEVELOPER warrants, covenants and agrees that it shall comply
with 24 CFR Pan B, which implements Section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 194), including, without limitation, the COnstlllCtOn of the Project so that it meets
the applicable accessibillly requirements, including, but not limited to, the following:
25
I. At least five percent (5%) of the dwelling units, or at least eleven
(11) units, whichever is greater, must be constructed to be accessible for persons with
mobility disabilities. An additional two percent (2%) of the dwelling units, or at least four
(4) units, whichever is greater, must be accessible for parsons wild hearing or visual
disabilities. These units must be constructed in accordance with the Uniform Federal
Accessibility Standards ( -FAS) or a standard that is equivalent or stricter. These
mandates can be found in 24 CFR Part 8, which Implements Section 504 of the
Rehabilitation Act of 1973 (29 U.5 C. 794),
IL The design and construction requirements of the Fair Housing Act
(Title VIII of the Civil Rights Act of 1968, as amended), including the following seven (7)
requirements of the Fair Housing Accessibility Guidelines:
1. Provide at least one accessible building entrance on an
accessible route.
2. Construct accessible and usable public and common use
areas.
3. Construct all doors to be accessible and usable by persons
in wheelchairs,
4, Provide an accessible route into and through Me covered
dwelling unit.
5. Provide light switches, electrical outlets, thermostats and
other environmental controls in accessible locations.
S. Construct reinforced bathroom walls for later Installation of
grab bars around toilets, tubs, shower stalls and shower
seats, where such facilities are provided.
7. Provide usable kitchens and bathrooms such that an
individual who uses a wheelchair can maneuver about the
space.
43. Discrimination Prohibited.
A. The DEVELOPER agrees to comply with the City's Fair Employment
Practices and shall not employ discriminatory practices in the provision ofservices,
employment of personnel, or in any other respect on the basis of race, color, religion,
sex, national origin, ancestry, or physical or mental handicapped. More specifically, the
DEVELOPER agrees as follows:
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I. The DEVELOPER warrants, covenants and agrees that it shall
comply with he CITY' s' ARrmalive Marketing Policy" document, incorporated herein, as
amended from time to time. DEVELOPER shall maintain records of actions taken to
affirmatively market units purchased and rehabilitated In the future, and In assess Me
results of these actions.
I. No person in the United States shall, on the grounds of race, color
religion, national origin, sex or sexual preference, ancestry, or physical or mental
handicap be excluded from participation in, be denied the benefits of, or be subject to
discrimination under any program or activity made possible by or resulting from this
Agreement.
W. The DEVELOPER will not discriminate against any employee or
applicant for employment because of race, color, religion, sex, sexual preference.
national origin, ancestry, or physical or mental handicap. The DEVELOPER shall take
affirmative action to ensure that applicants are employed, and the employees are
heated during employment, without regard to (heir race, color, religion, sex, naonal
origin, ancestry, or physical or mental handicap. Such action shall Include, but not be
limited to, the following: employment, upgrading, demotion or pari recruitment or
recruitment adverpsing; layoff or lamination; rates of pay or other forms of
compensation; and selection for training, including apprenticeship. The DEVELOPER
agrees fo post in conspicuous places available to employees and applicants far
employment, notices setting forth the provision of this nondiscrimination clause,
iv. The DEVELOPER will, In all saliciamon or advertisements far
employees placed by or on behalf of the DEVELOPER, state all qualified applicants will
receive consideration for employment without regard to race, color, religion, sex, sexual
preference, national origin, ancestry or physical or mental handicap.
B. The DEVELOPER will send to each labor union or representative of
workers wit which it has a collective bargaining agreement or other compact or
understanding, a notice advising the such labor union or workers' representatives of the
DEVELOPER'S commitment under this section and shall post apples of Ne notice in
conspicuous places available to employees and applicants for employment.
44. Conflict of Interest.
A. Prior to City's execution of this Agreement, DEVELOPER shall complete a
City of Fresno Conflict of Interest Disclosure Statement. Said Statement Is attached
hereto as Exhibit F and incorporated herein by reference. During the term of This
Agreement. DEVELOPER shall have the obligation and duty to immortately notify City
in writing of any change to Ne Information provided by DEVELOPER on Exhibit F.
I. No member, officer, or employee of the DEVELOPER or its
designees or agents who exercise any function or responsibility with respect to the
programs during his/her tenure or for one (1) year hereafter, shall have any Interest,
27
direct or Indirect, in any contract or subcontract, or the proceeds thereof for Servlces to
be performed in connection with this Agreement. The DEVELOPER shall incorporate,
or rause to be incorporated, in all contracts and subcontracts a provision prohibiting
such Interest pursuant to Ne purposes of this section.
ii. DEVELOPER shall not employ or retain the services of any person
while such person either is employed by City or is a member of any City commission,
board, commiftee, or similar City body. This requirement may be waived by Ne City's
Chief Adminharative Officer If no actual or Potential conflict is involved.
Iii. DEVELOPER shall comply with all applicable laws, rules,
regulations and requirements goveming avoidance of impermissible conflicts, including
without limitation Government Code 1090 at seq., the requirements of the Califomia
Political Reform Act (Govemment Cade Section 67100 at, seq.) and the ragulatlons of
the Fair Politirat Propose Commission concerning disclosure and disqualification (2
California Code of Regulations Section 16700 at. seq.).
IV . DEVELOPER represents and warrants that as of the effective date
hereof, it represents no client or customer whose Interests are adverse to the City's.
B. This section shall survive expiration or termination of this Agreement
45. Assurance of Governmental Approvals and Licenses. DEVELOPER represents
and warrants, as of the date hereof, that DEVELOPER has obtained and, to the best of
DEVELOPER'S knowledge, is in compliance with all federal, state, and local
govemmental reviews, consents, authorizations, approvals, and licenses presently
required by law to be obtained by DEVELOPER for the Project as of the date hereof.
46. Indemnification.
A. DEVELOPER shall indemnify, hold harmless and defend City and each of
its officers, officials, employees, agents from any and all loss, liability, fines, penalties,
forfeitures, costs and damages (whether in contracttort or strict liability, including but
not limited to personal injury, death at any time and property damage) incurred by City,
DEVELOPER or any other person, and from any and all claims, demands and actions In
law or equity (including adomey's fees and litigation expenses), arising or alleged to
have arisen directly or indirectly out of DEVELOPER's performance of this Agreement.
DEVELOPER's obligations under the preceding sentence shall apply regardless of
whether City or any of their officers, officials, employees, agents or authorized
volunteers are negligent, but shall not apply to any loss, liability, fines, penalties,
forfeitures, costs or damages caused solely by the grass negligence, or caused by the
willful misconduct, of City or any of hs officers, officials, employees, agents or
authorized! volunteers.
B. If DEVELOPER should contract or subcontract all or any portion of the
work to be performed under this Agreement, DEVELOPER shall require each contractor
or subcontractor to indemnify, hold harmless and defend City and each of its officers.
officials, employees, agents and authorized volunteers in accordance with the terms of
the preceding paragraph.
C. This section shall survive termination or expiration of this Agreement.
47. Insurance and Bonds.
A. Insurance. Throughout the life of Nis Agreement, be DEVELOPER shall
pay for and maintain In full force and effect all policy(tes) of insurance required
hereunder with (an) insurance companybes) either (t) admitted by time California
Insurance Commissioner to do business in the State of California and rated not less
than 'A -VII' In Best's Insurance Rating Guide, or (2) authorized by the Cl Risk
Manager, The following policies of insurance are required:
I. Prior to repair and rehabilitated of the Project Property and until
Issuance of Cedificate(s) of Completion, BUILDERS RISK (Course of Construction)
insurance in an amount equal to the completed value of the project wind no coinsurance
penalty provisions.
Following acquisition of me Project Property COMMERCIAL
PROPERTY insurance which shall be at least as broad as the most current version of
Insurance Service Office (ISO) Commercial Property Form CP 10 30 (Cause of Loss —
Special Form), with limits of Insurance In an amount equal to the full (100%)
replacement cost (without deduction for depreciator) of the Project Property with no
coinsurance penalty provisions. Such insurance shall include coverage for business
income, including "rental value", in an amount equal to the two (2) years of annual Rent.
Coverage for business income, including 'rental value," shall be at least as broad as the
most current version of Insurance Service Office (ISO) Commercial Property Form CP
0030.
III. The above described pclicy(ies) of insurance shall be endorsed to
provide that the coverage shall not be cancelled, non -renewed, retluced in coverage or
in limits except after thirty (30) calendar day written notice has been given to CITY.
Upon issuance by be insurer, broker, or agent of a notice of cancellation, non -renewal,
change or reduction in coverage, the DEVELOPER or its contractors/subcontractors, as
the case may be, shall furnish City with a new corticate and applicable endorsements
for such telicy(ies). In the event the policy is due to expire during me term of this
Agreement, DEVELOPER shall provide a new dominate, and applicable endorsements,
a new certificate evidencing renewal of such policy shall be provided not less than
fifteen (15) days prior to the expiration date of the expiring policy. Upon issuance by the
insurer, broker, or agent of a notice of cancellation, change or reduction in coverage,
me DEVELOPER or its contractorslsubcodtactors, as the case may be, shall file with
be OILY a certified copy of the new or renewal policy and certificates for such policy.
29
iv. The Builders Risk (Course of Construction) and Fire and Extended
Coverage Insurance policies shall the endorsed to name the City as a loss payee.
DEVELOPER shall furnish City with all ceNlcate(s) and applicable
endorsements effecting coverage required hereunder. All ceNflcates and applicable
endorsements are to be received and approved by the City's Risk Manager or his/her
designee prior to DEVELOPER'S execution of this Agreement
vi. The fact Mat insurance is obtained by DEVELOPER shall not be
deemed m release or diminish the liability of DEVELOPER, including, without limitation,
liability under the Indemnity provisions of this Agreement The duly to Indemnify City
and each of its officials, officers, employees, agents and volunteers shall apply to all
claimsand liability regardless of whether any insurance policies are applicable. The
policy limits do not act as a limitation upon the amount of indemnification to be covered
by DEVELOPER. Approval or purchase of any insuri contracts or policies shall In
no way relieve from liability nor limit the liability of DEVELOPER.
A. Upon request of City DEVELOPER shall immediately furnish City
wth a complete copy of any insurance policy required under this Agreement, Including
all endorsements, with said copy certified by the underwriter to be a true and correct
copy of the original policy. This requirement shall survive expiration or terininadon of
this Agreement.
viii. If at any time during me the of this Agreement or any extension, the
DEVELOPER fails to maintain the required insurance in full force and effect, all work
under this Agreement shall be discontinued immediately, until notice Is received by the
CITY that the required insurance has been restored to full farce and effect and that the
premiums therefore have been paid for a period satisfactory to me CITY, Any failure to
maintain the required insurance, subject to notice and cure requirements herein, shall
be sufficient cause for the CITY to terminate this Agreement.
B. Bonds. The DEVELOPER shall pay for and maintain good and sufficient
surety bonds from a corporate surety, admitted by the California insurance
Commissioner to do business In the State of California and TreasuryAsted, In a form
satisfactory to the CITY and naming the CITY as Co -Obligee.
1. The 'Faithful Performance Bondshall be at least equal to 100% of
DEVELOPER'S estimated construction costs to guarantee faithful performance of Me
Project, wIMIn the time prescribed in a manner satisfactory to the CITY, and that all
materials and workmanship will be free from anginal or developed defects,
II, The "Material and Labor Bond" shall be at least equal to 100% of
DEVELOPER'S estimated construction costs to satisfy claims of material supplies and
of mechanics and laborersemployed for this Project. The bond shall be maintained by
DEVELOPER in full force and effect until Me PmjW is completed and until all claims
30
for materials and labor are paid, released, or time barred, and shall otherwise comply
with any applicable provisions of the California Civil Core.
iii. In lieu of the bonds required above, CITY, in its sole discretion, may
accept from Developer an Irrevocable Standby Letter of Credit issued with the CITY
named as the sole beneficiary In the amounts) of the bonds required above. The
Irrevocable Standby Letter of Credit is to be Issued by a bank, and In a form, acceptable
to CITY. This Irrevocable Standby Letter of Credit shall be maintained by Developer in
full fares and affect until CITY Is provided with a recorded Notice of Completion far
construction of the Project and shall be subject to and governed by the laws of the State
of California,
d8. DEVELOPER Certification
A. The DEVELOPER condition; to the best of its knowledge and belle( that no
federally appropriated funds have been paid or will be paid by or on behalf of the
undersigned, to any person for Influencing or attempting to influence an officer or
employee of any agency, or a member of Congress, or an officer or employee of
Congress, or an employee of a member of Congress, in connection with the awarding of
any federal contract, the making of any federal grant, the making of any federal loan,
Me entering into of any cooperative agreement, or the extension, continuation, renewal,
amendment or modification or any Federal contract, grant, loan, or cooperative
agreement.
B. If any funds other than federally appropriatetl funds have been paid or will
be paid to a person for influencing an after or employee of any agency, a member of
Congress, an officer or employee of Congress, or an employee of a member of
Congress in connection with this fedeal contract, grant, loan, or cooperative
agreement, the. DEVELOPER shall complete and submit Standard Form -LLL,
'Disclosure Farm to Report Lobbying;' in accordance with its Instructions.
G, The DEVELOPER shall require that the language of the above codification
be included in the documents for all DEVELOPER tiers (including subcontracts,
subgrants, and contracts under grants, loans, and cooperative agreements) and that all
developerslrountra dmfs shall certify and disclose accordingly.
D. This certifcafion is a material representation of fact upon which reliance
was placed when this transaction was made or entered into. Submission of this
certification is a prerequisite for making or entering Into this Agreement.
49. Independent Contractor. In the famishing of the services provided for herein, the
DEVELOPER is acting as an independent contractor. Neither the DEVELOPER, nor
any of its officers. associates, agents or employees shall be deemed an employee or
agent of the City for any purpose. Nothing In this Agreement shall create a limited of
general partnership or joint venture, DEVELOPER shall have no authority to bind the
City absent City's express written consent Except to the extant otherwise provided in
this Agreement, DEVELOPER shall bear its own costs/expenses in pursuit hereof.
50. Notices. Any notice required or intended to be given to either parry under the
terms of this Agreement shall be in wnting and shall be deemed to be duly given If
delivered personally or deposited into me United! States mall, with postage prepaid
return receipt requested, addressed to the party to which notice is to be given at the
party's address set forth on the signature page of this Agreement or at such other
address as the parties may from time to time designate by written notice.
51. Sinding. Subject to Section 52 below ("Assignmeni once mis Agreement is
signed by all parties, it shall be binding upon, and shall inure to the benefit of, all parties,
and each parties' respective heirs, successors, assigns, transferees, agents, servants,
employees and representatives.
52. Assianmen[. This Agreement Is personal to the DEVELOPER and there shall be
no assignment by the DEVELOPER of its rights or obligations under this Agreement
without the prior written approval of the City. Any attempted assignment by the
DEVELOPER, its successors or assigns, shall be null and void unless approved in
writing by the City. Notwithstanding the above. DEVELOPER may assign its rights,
duces and obligations, title and interest under this Agreement to a wholly owned single
purpose subsidiary of DEVELOPER, subject to written approval by City, However, in
the event of such assignment as provided herein, DEVELOPER is in no way relieved of
any of its responsibilities, and shall remain fully responsible and liable to City under the
terms of this Agreement and all calmed agreements, and DEVELOPER shall retain full
correct and responsibility for the Project.
53, Waiver.
A. The waiver by either parry of a breach by the other of any provisions of
mis Agreement shall not constitute a continuing waiver or a waiver of any subsequent
breach of either the same or a different prevision of this Agreement
L No prevision of this Agreement may be waived unless In writing and
signed by all parties to this Agreement. Waiver of any one provision herein shall not be
deemed to be a waiver of any ower prevision herein.
54. Head'na. The section headings in this Agreement are for convenience and
reference only and shall not be construed or held In any way W explain, modity or add to
the interyrotabon or meaning of me provisions of this Agreement.
55. Severability. Tice provisions of this Agreement are severable. The invalidity, or
unenforceability of any one prevision in this Agreement shall not affect the other
provisions.
32
56 Interpretation. The parties acknowledge that this agreement in its final form is
the result of the combined efforts of the cables and that, should any provision of this
Agreement be found to be ambiguous in any way, such ambiguity shall not be resolved
by construing this Agreement in favor of, or against any party, but rather by construing
Me terms in accordance with their generally accepted meaning. In the event of any
confilct between the body of this Agreement and any Exhibit or Attachment hereto. the
terms and conditions of this Agreement shall control and take precedence.
57. Attorney's Fees. If either party is required to commence any proceeding or legal
action to enforce or interpret any term, covenant or condition of this. Agreement, the
prevailing party in such proceedingor action shall be artifact to recover from Ne other
party its reasonable attorney's fees and legal expenses.
58. Time of Essence. Time is of the essence for the performance of this Agreement
59. Extent of Agreement. Each party acknowledges that they have read and fully
understands the contents of this Agreement. This Agreement represents the entre and
Integrated agreement between the parties with respect to the subject matter hereof and
supersedes all poor negotiations, representafions and agreements, either written or
oral. This Agreement maybe modified only by written instrument duly authorized and
executed by both the City and the DEVELOPER.
60. Precedence of Documents. In the event of any conflict between Ne body of this
Agreement and any exhibit hereto, the terms and conditions of the body of this
Agreement shall control and take precedence over terms and conditions expressed
within the exhibit. Furthermore, in the event of any conflict between the body of tis
Agreement and any document or instrument referenced therein, the terms and
conditions of the body of this Agreement shallcontrol and take precedence over terms
and conditions expressed within said document or Instrument.
/11
33
IN WITNESS WHEREOF, the parties have executed this Agreement at Fresno,
California, the day and year first above written.
CITY OF FRESNO FRESNO REVITALIZATION CORPORATION
a California nonprofit public benefit corpaa0on
Brace Rutltl NamThe: Pre MinPresident ml
Assistant City Manager The: President
ATTEST:
FRESNO REVITALI] FON CORPORATION
REBECCA E. KLISCH
a California nonprofit Public benefit corpoafion
CITY CLERK
\,${
pp
By Lm4 jai- 1 {e t.
5/26//0 Qal
Deputy w
Name:.
'Rom CA W721
,
Title:
APPROVED AS TO FORM:
JAMES SANCHEZ
CITY ATTORNEY
A2'�
�'.—o
I'9
By: N
a
Deputy
r_taf1:aafyaRn
CITY:
FRESNO REVITALIZATION LORPORATIM
Housing and Community Development Division
2344 Tulare Sheet Suite 200
Planning and development Department
Fresno. CA 93721
Ann: Housing Manager
2600 Fresno St. Room 3070
'Rom CA W721
Attachments:
Exhibit A — Project Description, Schedule and Legal Description
Exhibit B — Dedaration of Restrictions
Exhibit C — Budget and Cash Flow
Exhibit D — Certificate of Completion
Exhibit E — Promissory Note
Exhibit F — Disclosure of Conflict of Interest
Exhibit G — Appraisal Requirements
119
CLERK'S CERTIFICATION
State of California)
County of Fresno )
On May 26, 2010, before me. Cindy Bruer. Deputy City Clerk, personally appeared
Bruce Rudd r Assistant CM Manager of the City of Fresno who proved to me on the
basis of satisfactory evidence to be the person(s) whose camels) is/are subscnbed
to be within instrument and acknowledged to me that he/shehhey executed the
same in his/her/their authorized capacity(ies), and that by hislberttheir signaturels)
on the Instrument the person(s). acted executed the instrument.
I certify under PENALTY OR PERJURY under the laws of the State of California
Nat the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
REBECCA E KLISCH. CMC
CITY CLERK, City of Fresno
BY 0±2vW r.
Dep
EXHIBIT A
Project Description, Schedule and Legal Description
A. The Agreement provides for the use of Neighborhood Stabilization Program
(NSP) funds in the amount of Two Million Seven Hundred Seventy Two Thousand Two
Hundred Fifty -Three Dollars ($2,]]2,253), by the DEVELOPER, for the purchase am
rehabilitation of a one hundred eighteen (118) unit multi family radical housing project.
B. The project is located at 3033 E. Platt Avenue, Fresno, CA 93721, wit APN
468-390-04s.
NSP FUNDED UNITS
% of Median
One Bedroom OnRs Two Bedroom
Units
Totals
50%or less
52 19
71
AM1OMable per Housng 5el
Aside edits
34 12
46
Schedule
Activi
Timeline
Oen Escrow
No later than April 30, 2010
Close Escrow
May 31, 2010
Cantron Very Low Income
Households on 71 units
August 31, 2010
Legal Description
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF FRESNO,
COUNTY OF FRESNO, STATE OF CALIFORNIA. AND IS DESCRIBED AS FOLLOWS:
Lots 1, 2, 3, 0 and 5 of Tract No 1938, Huntington Holmes Park, In Ne CNy of Fresno, County of
Fresno, Stats of California, according to the map thereof recorded Aprll 26 19631n Volume 21
Pages 66, 67 and 68 of Plans, Fresno County Records.
Excepting therefrom all oil, gas, other hydrocarbon substances and minerels of any kind or
character, In, on, or thereunder, as reserved in deeds of record.
APN: 488-390-04s
36
EXHIBIT B
EXEMPLAR DECLARATION OF RESTRICTIONS
BY AND far tee named
0 a recoming fee In awash win Cover
Code 6attoo s 6103 and 29383.
AND WHEN RECORDED MAIL TO'.
CITY OF FRESNO
Housing and Community Development Dinedon
2600 Fresno skeet, Room 3010
Fresno. CA 84121
TiYe Order No. Escrow No
APN: 468391
DECLARATION OF RESTRICTIONS
THIS DECIARATION OF RESTRICTIONS, ('Declaration'), is executed as of this
by l—("Declarant"), or assignees, in favor of the City of Fresno,
acting by and through its Planning and Development Department, Housing and
Community Development Division ("City').
WHEREAS, Decrement is the owner of the real estate in the county of Fresno,
state of California, consisting of Al 468-39044s, which is more particularly described
In Exhibit "A", attached hereto and made a part hereof (the "Property" ); and
WHEREAS, Pursuant to a certain Neighborhood Stabilization Program
Agreement dated , 2010, Incorporated herein, ("NSP Agreement") and
instruments referenced therein. Declamnl agrees to utilize and City agrees to provide
certain NSP Funds from the United States Department of Housing and Urban
Development, to Declarant for certain affordable housing (the "Project") upon the
Property to be rented and maintained as affordable W very low income families, subject
to me terms and Conditions set forth In the NSP Agreement) and
WHEREAS, me NSP regulations promulgated by HUD, and me NSP Agreement
impose certain affordability requirements upon property benefited thereby, which
affordability restrictions shall be enforceable for a fifty five (55) year period; and
WHEREAS, these restrictions are Intended to bind all purchasers and their
successors.
NOW THEREFORE, Declarant dedares that the Project upon the Property Is
held and will be held transferred, encumbered, used, sold, Conveyed and occupied
37
subject to Me covenants, restrictions, and limitations set forth in this Declaration, all of
which are declared and agreed to be In furtherance of the plan for the acquisition, rental
and occupancy of the Property. All of the restrictions, covenants and limitations will run
with Me land and will be binding on all parties having or acquiring any right, titre or
interest in the Project upon the Property or any part thereof, will inure to the benefit of
he future Owners of the Property or any part thereof, the United States arm the City.
and will be enforceable by any of them, Any purchaser under a contract of sale
covering any right, title or interest in any part of Me Project Property, by accepting a
deed or a contact of sale or agreement of purchase, accepts Me document subject to,
and agrees to be bound by, any and all restrictions, covenant, and limitations set forth in
this Declaration for the period of fifty five (55) years consenting the Affordability Period.
Pencil of Affordability: The Neighborhood Stabilization Program requires the City to
set periods of affordability as provided in NSP regulations. The minimum period of
affordability for MIs program is fifty five (55 years), year one shall be the 12 -month
period following issuance of the Certificate of Completion of he Project Property, whh
each succeeding year beginning on Me anniversary thereof and ending 12 month
hence, There will be no partial years.
1. Declarations. Declaant hereby declares that he Property is and shall be
subject to the covenants and restrictions hereinafter set forth, all of which are declared
W be in furtherance of the Project and the NSP Agreement, and are established and
agreed upon for the purpose of enhancing and protecting the value. of Me Project
Property and in consideration for City entering into Me NSP Agreement with Declarant.
All terms not otherwise defined herein shall have the meaning started to such term In
the NSP Agreement.
2, Restrictions. The following covenants and restrictions on the use and
enjoyment of Me Project Property shall be in addition to any char covenants and
restrictions affecting the Project Property, and all such covenants and restrictions are for
the benefit and protection of City, and shall run with Me Property and be binding on any
future owner's of the Project Property and inure to the benefit of and be enforceable by
City. These covenants and restrictions are as follows:
a. Detlarant for itself and its successors) on title covenants and
agrees that It shall cause Me Project Property to be used as Affordable Housing for Me
duration of Me Affordability Period. Declarant fuller agrees to file a recordable
document setting forth the Project Completion Datefs) and the Affordability Period when
determined by Me City. Unless otherwise prowded In Me NSP Agreement, the term
Affordable Housing shall include, without limitation, compliance with the following
requirements:
Nondiscrimination. There shall be no discirmination against nor
segregation of any person or gmup of persons on account of race, color, creed. religion.
sez, residual status, national origin, ancestry, or handicap in Me sale, transfer, use,
occupancy, tenure, or enjoyment of any of the Project Property, nor shall Declarant or
KIT
any person claiming under the Declarant, establish or permit any practice of
discrimination or segregation with reference to Me selection, location, number, use or
occupancy of owners or veranda of Me Project Property.
Principal Residence. Each unit constituting the Project cinch Me Property
shall be rented only to natural perm who shall occupy the Unit as the principal
residence. The foregoing requirement that the tenant of each Unit constituting the
Project Property occupy Me Unit as the tenant's principal residence does not apply to
persons, other than natural persons, who acquire Me Project Property or portion thereof
by foreclosure or deed in lieu of foreclosure', or (it) HUD qualified entities that acquire
the Project Property or potion thereof, with the consent of the City.
Income Requirements. The NSP funded units constituting the Project
upon Me Property and each of them may be rented only to (a) natural persons) whose
annual household Income at Me time Is not greater Man fifty percent (50%) of the most
recent annual median income calculated and published by HUD for the Fresno
Metropolitan Statistical Area applicable N such household's size. A total of seventy one
(71) floating units are NSP funded units.
Item (a) above is hereinafter referred to. as the Covenant and Restrictions.
3. Enforcement of Restrictions. Without waiver or limitation, the City shall be
entitled to Injunctive or other equitable relief against any violation or attempted violation
of any Covenant and Restriction, and shall, in addition, be entitled to damages for any
injuries or losses resulting from any violations thereof.
4. Acceptance and Ratification. All present and future owners of the Project
Property and other persons claiming by, through, or under them shall be subject to and
shall comply with the Covenant and Restrictions. The acceptance of a deed of
conveyance to the Project Property shall constitute an agreement that the. Covenant
and Restrictions, as may be amended or supplemented from time to time, are accepted
and ratified by such future owners, tenant or occupant, and such Covenant and
Restriction shall be a covenant running with the land and shall bind any person having
at any time any Interest or estate in the Project Property, all as though such Covenant
and Restriction was recited and stipulated at length in each and every deed.
conveyance, mortgage or lease thereof.
Notwithstanding the foregoing, upon foreclosure by a lender or other
transfer in lieu of foreclosure, or assignment of an FHA -insured mortgage to HUD, the
Affordability Period shall be terminated if the foreclosure or other transfer In lieu of
foreclosure or assignment recognizes any contractual or legal rights of public agencies,
nonprofit sponsors, or others to take actions Met would avoid the termination of
affordability. However, the requirements wgh rasped to Afordable Housing shall be
revived according to their original terms, if during the original Affordability Period the
owner of record before he foreclosure or other transfer, or any entity that includes Me
former owner or those with whom the former owner has or had formerly, family or
39
business ties, oblains an ownership interest in the Project or the Property, and the
Affordability Period shall be revived according to its original terms.
5. Benefit. This Declaration shall run with and bind the seventy one (71)
Pmject Units for a term commencing on the date this Declaration is recorded in the
Office of Me Recorder of the county Fresno, state of California, and expiring upon Me
expiration of the Affordability Period. The failure or delay at any time of City or any
other parson entitled to enforce this Declaration shell in no event be deemed a waiver of
the same, or of Me right to enforce the same at any time or fmm time to time thereafter,
or an estoppel against Me enforcement thereof
6. Costs and Attomey'sFees. In any proceeding arising because of failure
of Declarant or any future owner of the Project Property to comply with the Covenant
and Restrictions required by this Occidenta , as may be amended from time In time,
City shell be entitled to recover its costs and reasonable attorney's fees Incurred In
connection with such default or failure.
7. Waiver. Neither Declarant nor any future owner of the Project Property
may exempt itself from liability for failure to comply with the Covenant and Restrictions
required in this Declaration.
B. Severabilly. The Invalidity of Me Covenant and Restrictions or any other
covenant, restriction, condition, limitation, or other provision of this Dedamlion shall not
Impair or affect in any manner the validity, enforceability, or effect of Me rest of his
Declaration and each shall be enforceable to the greatest extent permitted by law.
9. Pronouns. Any reference to Me masculine. feminine, or neuter gender
herein shall, unless Me context clearly requires the company, be deemed to refer to and
include ail gantlets. Words In the singular shall include and refer to the plural, and vice
versa, as appropriate.
10. Interpretation. The captions and titles of the various articles, sections,
subsections, paragraphs, and subparagraphs of this Declaration are inserted herein for
ease and convenience of reference only and shall not he used as an aid In Interpreting
or construing this Declaration or any provision hereof.
11. Amendment No amendment or modification of this Declaration shall be
permitted without the prior written consent of City.
12, Recordation. Declarant acknowledges that this Declaration will be filed of
record in Me Office of the Recorder of county of Fresno, State of California.
13, Capital¢ed Terms. All capitalized terms used in this Declaration, unless
otherwise defined herein, shall have the meanings assigned to such terms in that
certain NSP Agreement by and between Dedarant and City, of even date,
IE
14. Headings. The headings of the articles, sections, and paragraphs used in
this Agreement are for convenience only and shall not be read or construed! to affect the
meaning or construction of any provision.
IN WITNESS WHEREOF, Declarant has executed this Declaration of
Restric ions on the date first written above.
"DECLARANT'
FRESNO REVITALIZATION CORPORATION
a California non-profit public benefit corporation
Date'
Date:
Exhibit C
NBP Budget and Cash Flow
Use
NBP Amount
Private Financia
uisition
$2460,204
$1,937,796
Rehabllitatlon and Closin Costs
$292,49
0
Total
$2,772,253
$1,937,796
42
Operating Pro Fomes
Pro Fortna Mo nVil
Pro Forma Annual
RENTALINCOME
GROSS RESIDENTIAL RENT
65,95000
]91,400.70
LESSVACANCY ADJUSTMENTS
ss.
EFFECTIVE GROSS INCOME (EGI)
59,3550
71226000
OPERATING EXPENSES
PAYROLL EXPENSES ON-SITE
MANAGER
_4,166.67
(WQMC0
PAYROLL EXPENSES ON-SITE
MAINTENANCE
2.]166]
32,60000
ADMIN EXPENSES (NET OF MGMT
FEE)
I1229,1.
14.750.00
MANAGEMENT FEES (4% of EGIU
2.3]4.20
28,490 40
%ARKETINGIRETENTION
118000
{14_160.00
MAINTENANCE B REPAIR
295G00
35400.00
TURNOVER EXPENSES
.1.966.6]
23,600.00
UTILITIES
643258
(77 191M)
RESERVES FOR REPLACEMENT'-:
II ,6]
23 0.00
INSURANCE
2,500.00
30,00000
PROPERTY TAXES'.
". 174.
TOTAL OPERATING EXPENSES
31657 121
J379�BIX 4
NET OPERATING INCOME
2] 69] 89
332,3]4.60
INTEREST EXPENSE
123
NET INCOMEICASH FLOW
$17,44371
5209,324.55
43
Exhibit D
EXEMPLAR CERTIFICATE OF COMPLETION
RECORDED AT THE REQUEST OF
AND WHEN RECORDED RETURN TO,
City of Fresno
Housing Division
16M Fresno Steel, Room 309D
Freeno. CA 93731
This Certificate of Completion is recorded at the request and for the benefit of the City of
Fresno and Is exempt from the payment of a recording fee pursuant to Government
Code Section 6103.
APN-06&390-04s
City of Fresno
By: , Director
Planning and Development Department
Data
CERTIFICATE OF COMPLETION
L1NJ
Rel
A. By a Neighborhood Stabilization Program Agreement dated 2010,
("NSP Agreement") between the City of Fresno, a municipal corporation (`CITY"), and
a California Corporation, (`DEVELOPER'), the
DEVELOPER agreed to acquire a one hundred eighteen (118) unit multi -family rental
housing project ("Project"), upon the premises legally described! in Exhibit A, attached to
Me NSP Agreement, made a part hereof my this reference, (the "Propedy"), for the
purposes of Affordable Rental Housing, with the assistance of NSP funds white meeting
Me affordable housing, Income targeting and other requirements of the NSP, according
to the terms and conditions of the NSP Agreement and the Loan Documents and other
documentlnstruments referenced therein.
S. The NSP Agreement or a memorandum of It was recorded on
2010 as Instrument No, in the Oficial Records of Fresno County,
California
C. Under Me terms of the NSP Agreement, after the DEVELOPER completes
the Project, the DEVELOPER may ask CITY to record a Certificate of Completion.
D. The DEVELOPER has asked CITY to furnish the DEVELOPER with
recordable Certificate of Completion.
E. The CITY's issuance of this Certificate of Completion is conclusive
evidence that the DEVELOPER has completed construction of Me Property as set forth
in the NSP Agreement.
NOW THEREFORE:
1. CITY certifies that the DEVELOPER commenced the Project on the
Project Property on 2010 and completed the Project on Me
Project Property on 2010, and has done so In full compliance with
Me NSP Agreement.
2. This Certificate of Completion is not evidence of the
DEVELOPER compliance with, or satisfaction of any obligation to any mortgage or
security interest holder, or any mortgage or security Interest Insurer, securing money
lent to finance work on Me Property or Project, or any part of the Property or Project.
3. This Certificate of Completion is not a notice of completion
as referred to in California Civil Code Section 3093.
4. Nothing contained herein modifies any provision of the NSP
Agreement.
IN WITNESS WHEREOF, CITY has executed this Certificate of Completion as
of this day of 20_
CITV OF FRESNO
By:
Director
Planning and Development Department
ATTEST: APPROVED AS TO FORM:
CITY CLERK JAMES C. SANCHEZ
BY: By:
Deputy Deputy
Date. Date!
CONSENT OF DEVELOPER
FRESNO REVITALIZATION CORPORATION
By signing below, the owners) of the property consent(s) to recon ing this Certificate of
Completion against she Property described herein.
V=1h muyunin®ie or ld,m 'wq IAaem munoexnfaueraw smn�l
Exhibit E
EXEMPLAR PROMISSORY NOTE
(Program: Neighborhood Stabilization Program)
DO NOT DESTROY THIS NOTE: When paid, this nate must be surrendered to
Borrower for Cancellation.
12,772,253 Fresno, Criticisms, _, 2010
Promise to Pay. For value received, the undersigned, a California
Company ("Developer" or "Borrower'), promises to pay to the most of the City of
Fresno, a California municipal corporation, ('Lender'), the sum of Two Million Seven
Hundred Seventy Two Thousand Two Hundred Fifty Three Dollars and DWI
($2,]]2,253.00) at zero percent interest, due and payable at the earlier of (i) 55 years
tram the City Issued Gertificate of Completion (the Affordability Period) or (it) the date
upon which the Borrower has completed payment on other property acquisition liable).
On or before the earliest of (i) or (it) above (Me "Maturity Date'), and pursuant to the
parties' Neighborhood Stabilization Program Agreement dated
, 2010 ("NSP Agreement"), on which date Me unpaid principal balance together with
interest and unpaid penalties or late charges where applicable thereon shall be due and
payable In a lump sum, along with attorney's fees and costs of collection, without relief
tram valuation and appraisement laws; provided Mat, in the event the Developer is not
then In default of the NSP Agreement, the Developer may at any time pay off the
principal prior to the Maturity Date. If, upon sale of the Project Property, by Borrower,
and the repayment of the Note associated with the First Deed of Trust, there are
Inadequate proceeds to pay Lender Me full principal and interest due under this
Promissory Note solely More the proceeds of the sale, Lender shall accept such
payment from Borrower as full repayment of all unpaid principal due without any further
recourse to Sommer.
Any failure to make a payment required hereunder shall constitute a default under this
Nate.
Definitions. All capitalized terms used in this Note, unless otherwise caflned, will have
Me respective meanings specified in the NSP Agreement.
Business Dov means any day other than Saturday, Sunday, or public holiday or the
equivalent for banks generally under the laws of California. Whenever any payment to
be made under this Note is stated to be due on a day other than a Business Day, Mat
payment may be made on Me next succeeding Business Day. However, if Me
extension would rause the payment to be made in a new calendar month, that payment
will be made on the neat preceding Business Day.
Afiordabitty Peyotl The minimum period of affordability for this Program Is fifty five (55)
years. Year one shall be the 12 -month period following issuance of me Certificate of
47
Completion for the Project with each succeeding year beginning on to anniversary
Mereof and ending 12 month hence. There will be no partial years.
Securay. Lender, by any and all UCC -1 Financing Statements) filed, may perfect
Lender's security Interest in this Note, the NSP Agreement, and any extensions or
renewals hereof, and any and all accounts, chattel paper, payment intangibles, or
promissory notes.
Time is of the Essence. It will be a default under this Note if Borrower defaults under
Me NSP Agreement, defaults under any other Program documents, or If Borrower fails
M pay when due any sum payable under this Note, In the event of a default by
Borrower, the Borrower shall pay a late charge equal to the lesser of 2% of any
outstanding payment or the maximum amount allowed by law. All payments collected
shall be applied first to payment of any costs, tees or other charges due under this Note
or any other Program documents and then to principal balance. On the occurrence of a
default or on the occurrence of any other event that under the terms of the Ivan
documents give rise to the fight to accelerate Me balance of the indebtedness, then, at
Me option of Lender, this Nota or any notes or other instruments that may be taken In
renewal or extension of all or any pad of the indebtedness will immediately become due
without any further presentment, demand, protest, or notice of any kind.
Terms of Payment The Indebtedness portended by this Note may, at the option of Me
Borrower, be prepaid in whole or In pad without penalty. Lender will apply all the
prepayments let to the payment of any costs, fees, late charges, or other charges due
under this Note or under any of Me other Program documents and Men to Me principal
balance.
All Loan payments are payable in lawful money of the United States of America
at any place that Lender or the legal holders of this Note may, from time to time, in
writing designate, and in Me absence of Mat designation, to'.
City of Fresno — Finance Department
FinanceFTreasury Section
2600 Fresno Street, Room 2156
Fresno, CA 93721
Borrower agrees 10 pay all costs Including, without limitation, attorney fees,
Incurred by the holder of this Note In enforcing payment, whether or not suit is filed, and
Including, without limitation, all casts, attorney fees, and expenses incurred by the
holder of this Note in connecfion with any bankruptcy, reorganization, arrangement, or
other similar proceedings involving the undersigned that in any way affects the exercise
by the holder of this Note of Its rights and remedies under this Note. All costs incurred
by the holder of this Note in any action undertaken to obtain relief from the stay of
bankruptcy statutes are specifically induced In those costs and expenses to be paid by
Borrower, Borrower will pay to Lender all attorney fees and other costs referred to M
this paragraph on demand.
CE
Any notice, demand, or request relating to any matter set forth herein shall be In
writing and shall be given as provided In the NSP Agreement.
No delay or omission of Lender In exercising any right m power arising in
connection with any default will be construed as a waiver or as acquiescence, nor will
any single or partial exercise preclude any further exercise. Lentler may waive any of
the ounditlgns in this Note and no waiver will be deemed to be a waiver of Lenders
rights under this Note, but rather will be deemed to have been made in pursuance of
this Nota and not in modification. No waiver of any default will be consented b be a
waiver of or acquiescence in or consent to any preceding or subsequent default.
Tames of Security Instruments The Dead of Trust securing this note shall provide as
follows:
DUE ON SALE—CONSENT BY BENEFICIARY, Beneficiary may, at its option, declare
immediately due and payable all sums secured by this Deed of Trust upon the sale or
transfer of all or any portion of the Property, or any Interest therein, without the
Beneficiary's prior consent. A "sale or transfermeans the conveyance of the Property
or any right, title or interest thereiq whether legal, beneficial or equitable; whether
voluntary or involuntary: whether by outright sale, deed, installment sale contract, land
contract, contract for deed, leasehold Interest with a term greater than three (3) years,
leaseaption contract, or by sale, assignment, or transfer of any beneficial interest in or
to any land trust holding title to the Property, or by any other method of conveyance of
land interest. If any Trustor is a corporation, partnership or limited Ilabllity, company,
transfer also Includes any change in ownership of more than twenty-five percent (25%)
of the voting stock, partnership interests or limited liability company interests, as the
case may be, of Trustor. However, this option shall not be exercised by Beneficiary if
such exercise is prohibited by applicable law.
Assignment by Lender. Lender may transfer this Note and deliver to the transferee all
or any pad of the collateral then held by It as security under this Note, and the
transferee will Oren became vested with all the powers and rights given to Lender, and
Lender will then be forever relieved from any liability or responsibility in me matter, but
Lender will retain all rights and powers given by this Note with respect to collateral not
harshened.
Enforceability. If any one or more of the provisions in this Nota Is held to be invalid,
illegal, or unenforceable In any respect by a court of competent jurisdiction, the validity,
legality, and enforceability of the remaining provisions will not in any way be affected or
impaired. This Note will be binding on and inure to the benefit of Borrower, Lender, and
their respective successors and assigns.
Governing Law. Borrower agrees that this Note will be deemed to have been made
under and will be governed by the laws of Califomla In all respects, Including matters of
construction, validity, and performance, and that none of its terms or provisions may be
E
waived, altered, modified, or amended except as Lender may consent to. in a writing
duly sign" by Lender or Its authorized agents.
In witness whereof, Borrower has caused this Note to be executed by IN
Authorized agent as of the dale and year first above written.
Fresno Revitalization C rporatiaq Borrower
By: Data
Name:
Title'.
(Allach notary mNfcab of acknowledgmane
Exhibit F
DISCLOSURE OF CONFLICT OF INTEREST
Name: J ndderit
The: � resident
YES'
NO
1.
Are you currently in Iltigadon with the City of Fresno or any of
its agents?
2.
Do you represent any firm, organization or person who is In
litigation with the City of Fresno?
�
3.
Do you currently represent or perform work for any clients
who do business with the City of Fresno?
✓
4.
Are you or any of your principals, managers or professionals,
owners or investors in a business which does business with
✓
the City, or in a business which Is in litigation with the City?
5.
Are you or any of your principals, managers or professionals,
related by blood or marriage to any City employee who has
any significant role in the subject matter of one service?
6. 1
Am you employed by any other jurisdictions or agencies?
✓
It the answer to any question Is yes, please explain In full.
Name: J ndderit
The: � resident
EXHIBIT G
Appraisal Requirements
The Uniform Relocation Assistance and Real Property Acquisition Policies Act (URA)
and Its implementing regulations (49 CFR Part 24) set foM minimum requirements for
real property acquisition appraisals for Federal and federallyassistedprograms.
Appraisals subject to the URA must be prepared according to these requirements.
The acquiring DEVELOPER has a legitimate role In contributing to to appraisal
process, especially In developing ascope of work and defining the appraisal task. The
scope of work and development of an appraisal under these requirements depends on
Me complexity of the appraisal task.
The scope of work is a written set of expectations that form an agreement or
understanding between Me appraiser and the DEVELOPER as to the specific
requirements of the appraisal, resulting In a report to be delivered to the DEVELOPER
by the appraiser. The scope of work must address the unique, unusual and variable
appraisal performance requirements of the appraisal. Either the appraiser or the
DEVELOPER may recommend modifications to Me initial scope of work, but both
parties must approve changes.
SCOPE OF WORK
The appraiser must, at a minimum'.
I . Provide an appraisal meeting the definition of an appraisal found at 49
CFR 24 2(a)(3) which is a written statement independently and Impartially
prepared by a qualified appraiser setting forth an opinion of defined value
of an adequately described property as of a specific date, supported by
the presentation and analysis of relevant market Information.
2. Afford the property owner or Me owner's designated representative the
opportunity to accompany the appraiser on the inspection of the property.
3. Perform an inspection of the subject property. The Inspection should be
appropriate for the appraisal task, and the scope of work should address:
• The extent of the inspection and description ofthe neighborhood
and proposed project area,
• The extent of Me subject property Inspection, including interior and
exterior areas,
• The level of detail of Me description of the physical charactenstcs
of the property being appraised (and, in the case of a petal
acquisition, the remaining property.)
52
4. The appraisal must have been completed within 60 days of the offer made
for the property.
5. The acquiring DEVELOPER has the responsibility to assure that the
appraisals it obtains are relevant to Re program needs, reflect established
and commonly accepted Federal and federally -assisted program appraisal
practice, and as a minimum, complies with the definition of appraisal
stated above and the five following requirements:.
(i) An adequate description of the physical characteristics of the
property being appraised including items Identified as personal
property, a statement of the known and observed encumbrances, if
any, title information, location, zoning, present use, an analysis of
highest and best use, and at least a 5 -year sales history of the
property.
(ii) All relevant and reliable approaches to value consistent with
established Federal and federallyassistedprogram appraisal
practices. If the appraiser uses more than one approach, there
shall be an analysis and recondliation of approaches to value used
that Is suffident to support the appraisers opinion of value.
(til) A description of comparable sales, including a description of all
relevant physical, legal and economic factors such as parties to the
transaction, source and method of financing and verification by a
party involved in the transaction.
(iv) A statement of the value of me real property to be acquired and, for
a partial acquisition, a statement of the value of the damages and
benefits, if any, b the remaining real property, where appropriate.
(v) The effective date of the valuation, date of appraisal, signature, and
certification of the appraiser (see attached sample).
6. The appraiser shall disregard any decrease or Increase in the fair market
value of the real property caused by the project for which the property is to
be acquired or by the likelihood that the property would be acquired for the
project, other than that due to physical deterioration within the reasonable
control of the owner.
53
CERTIFICATE OF APPRAISER
I hereby certify
That on datefs), I personally made a fleld inspection of the
property herein appraised and have afforded the owner or a designated representative
Me opportunity to accompany me on this inspection. 1 have also personally made a field
inspection of the cr mparable sales relied upon in making said appraisal. The property
being appraised and the comparable sales relied upon in making this appraisal were as
represented In the appraisal.
That to the best of my knowledge and belief the statements contained in Me appraisal
herein net form are We, and Me Information upon which the opinions expressed therein
are based is coned; subject to the limiting conditions therein set forth.
That I understand that such appraisal may ba used In connection with the acquisition of
property for a pmject utilizing U.S. Department of Housing and Urban Development
funds.
That such appraisal has been made in conformity wRh appropriate laws, regulations,
and policies and procedures applicable to appraisal of property for such purposes', and
that to the best of my knowledge no portion of the value assigned to such property
consists of items which are noncompensable under Me established law of said State.
That any decrease or increase in the fair market value of real property prior to the date
of valuation caused by Me project for which such property is acquired, or by Me
likelihood that the property would be acquired for such project, other than that due to
physical deterioration within Me reasonable control of the owner, was disregarded In
determining the compensation for the property,
That rather my employment nor my compensation for making this appraisal and report
are in any way contingent upon Me values reported herein.
That I have no direct or indirect present or contemplated future personal interest in such
property or in any benefit from the acquisition of such property appraised.
That I have not revealed the findings and results of such appraisal to anyone other Man
to proper officials of the acquiring DEVELOPER or officials of the U.S. Department of
Housing and Urban Development and I will not do so until so authorized by said
officials, or until I am required to do so by due process of law, or until I am released
from this obligation by having publicly testified as to such findings.
That I have not given consideration to, or included In my appraisal, any allowance for
relocation assistance benefits.
54
That my opinion of the fair market value of the. property to be acquired as of
is $ based upon my independent
appraisal and the exercise of my professional judgment.
Name
Signature
Date
55
OPERATING AGREEMENT AND LOAN GUARANTY
by and between
Redevelopment Agency of the City of Fresno,
a public body, corporate and politic
and
FRESNO REVITALIZATION CORPORATION,
a California Non -Profit Public Benefit Corporation
regarding
Canyon Crest Condominiums
(A Multi -Family Rental Apartment Property)
ATTACHMENTS
Exhibit A:
Legal Description of Property
Exhibit B:
Plat Map of the Property
Exhibit C:
Budget/Financial Plan
Exhibit D:
Certificate of Completion
Exhibit E:
Basic Program of Wort:
Exhibit F:
Regulatory Agreement
Exhibit G:
Loan Guaranty
Exhibit H: Agreement for Purchase and Sale of Real Property
Exhibit I: Neighborhood Stabilization Program Agreement
Exhibit I Seller's Loan Documents
Exhibit K: Contractual Services Agreement between RDA and OWNER
Pagel
THIS OPERATING AGREEMENT ('Agreement) is entered as of the Effective
Date (defined in this Agreement), between Me REDEVELOPMENT AGENCY OF THE
CITY OF FRESNO, a public body, corporate and politic, ("Ageri and Me FRESNO
REVITALIZATION CORPORATION, a California Non -Profit Public Benefit Corporation
("Owner)
RECITALS
The partes enter this Agreement based on the following fads, understandings, and
Intentions:
A. By authority granted under Plromi Redevelopment Law (the "taw'), Me
Agency has prepared and Is responsible for carrying out Me redevelopment plan for
certain Redevelopment Project Areas (Me'Plan'), including as k certain prienty of use
of Tax Increment antler Housing Set Aside Funds (collectively'Tax Increment.)
B. To Me extent provided in or allowed by the Lew including California Health
and Safety Code ('Cal. H& S.C.") Sections 33334.2 and 33449, as prodded by joint
resolutions of the Fresno City Council antl the Agency, finings and determinations
pursuant to Cal. H&S.C. Section 33334.2(8), Me Plan and limited to the terms and
conditions therein, Me Agency may make improvements upon and/or consWd and
improve structures In order to provide housing for persons and families of low or
moderate income, including related on-site and offals Improvements, by venously: (1)
allowing the use of Housing Set Aside Funds outside Me Airport Area ReOlodzation,
Central Business District Central City Commercial Reviklimtion, Chinatown Expanded,
Convention Center, Freeway 99Golden State Boulevard Condor, FriVChuroh,
Mariposa, Reeding Business Park, South Fresno Industrial Revitalization, South Van
Ness Industrial, Southeast Fresno Revitalization, West Fresno I, West Fresno II, West
Fresno It redevelopment plans) (2) resNctirg the use of the Housing Sal Aside Funds
to cookie of the Community Development Block Grant eligible areas of the City, and (3)
placing a plenty on the use of the Housing Set Aside Funds from certain Project Areas
to be used either within or adjacent to Me Central Area or adjacent to careen Project
Areas.
C. Agency administers the Low and Moderate Income Housing Fund
established pursuant to Cal. H& S.C. Sections 33334.2 at seq.
D. Purer is a California Non -Profit Public Benefit Corporation, exempt hem
federal and state Income tax under Section 501 e(3) of Me Internal Revenue Code and
Section 23701(d) of Me Calffomla Revenue B Taxation Code for me, purpose of assisting
the Agency with revitalization of Me downtown area of Fresno, California.
E Owner shall acquire all rights, title an Interest in fee to Me basin real
properly deserted in Exhibit "A' attached hereto antl Incorporated hares (Me
"Properly ). The Property is located adjacent lothe Cental Area and within Me ternithrlal
jurisdiction of Me Agency for the use of Housing Sol Aside Funds.
Page
E Owner proposes to acquire a multifamily residential project on the Property,
nsimirg of one hundred eighteen (118) resicambal units, wherein one hundred
seventeen (117) units shall be rented to very low and lower income househmlds.
G. Owner proposes to enter an Agreement with the City of Fresno whereby
the City shall make a loan to Owner from its Neighborhood Stabilization Program
('NSP') in the amount of $2,A2,253 b Owner for acquisition and renovation of the
Property under the terms and conditions of Net NSP Agreement, attached hereto as
Exhibit -I* to this Agreement.
H. Owner agrees to undertake Improvements to the Property in accordance
with the Basic Program of Work described In Exhibit °E" attached hereto and
incorporated herein (the 'Basic Program of Wmrk'j,
1, The Property and associated on site and off site improvements are
collectively Wanted to in this Agreement as the 'Improvements' or this °Property; all of
which will directly benefit the Property and the Plan Area.
J. Agency is willing to assist Owner's acqulai8on of the of the Property by
providing a Loan Guaranty to Owner through the use of certain Housing Set Aside (Tax
Increment) Funds In an amount of One Million, Nine Hundred Thirty -Seven Thousand,
Seven Hundred Nini Dollars ($1.937.7W.00)(Bre 'Agency Guaranty') upon the
terms and conditions specified in Nis Agreement and provide administrative, financial
and technical support to the Owner in the acouisirl and operation of the Property.
N. The Agency Loan Guaranty shall be made in accordance with this
Agreement. The Agency Guaranty and performance of the affordability and other
covenants and restrictions set forth in this Agreement shall be evidenced by a
Regulatory Agreement shown In Exhibit 'Fto this Agreement and which shall be
recorded against and con will the Property.
L. The Housing and Community Development Commission reviewed the
Property and this Agreement on February 24, 2010, and recommended Met the City
Council and Agency Board approve IL
M. The Agency Boats reviewed and approved the Property and this
Agreement on April 8, 2010.
N. The Project has been environmentally assessed (Environmental
Assessment No. H-2010-10) and was determined to be categorically excludetl from
review under Section 5835 (a)(3) II and (a)(5) of the National Environmental Policy Act
(NEPA) Guidelines. Additionally, the Project hes. been assessed under the CaHomia
Environmental Quality Act (CEPA), resulting in a Categorical Exemption. Based on the
review, City slag determined that the project is consistent with all of the chane specRed
for an exemption to CEQA in accordance with Section 15301/Class 1 and 15378(6)(4) of
CEOA Guidelines.
O. Agency hes further determined this Project is in the best interests of, and
will matemey contribute b, Plan implementation. Further, Agency has found the
Project (i) will have a positive influence in the Plan Area, and surrounding environs, (ii)
is in the vital and best interests of Agency and the heats, safety, and welfare of City
residents; (Iii) complies with applicable federal, slate, and local laws and requirements;
(iv) will help eliminate bllghl; (v) will improve and preserve the community's supply of low
and moderate income housing available at affordable rent, as defined by Cal. H.& S.C.
Section 50053, to persons and families of low or moderate Income, as refract in Cal.
H.& S.C. Section 50093: (vi) will be available to meet the replacement housing
provisions In Cal. HA S.C. Section 33413; (vii) will apply funds solely within the
respective Plan areas except to the extant otrmrwiae provided herein and allowed by
Law; (viii) includes only planning and administrafve expenses Incurred in pureult hereof
that are necessary for the production, improvement, or preservafon of low and moderate
income housing: (x) will comply with all owner participation rules and otters of Agency
and the Plan; and (x) will comply with any and all applicable review and other
requirements of the City's Historical Preservation Ordinance.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the covenants,
conditions and promises hereinafter contained to be kept and performed by the
respective pares, it is mutually agreed as follows'.
1. DEFINITIONS. Besides definitions container! elsewhere In this Agreement,
the definitions in this Section will govern fire construction, meaning, application and
Interprelabon of the various terms used in this Agreement
1.1. 'ADA" means the Americans with Disabilless Act of 1990.
1.2. "Affordability Pared means a period of fifty-five (55) were commencing
from the date Agency records gree Certificate of Completion, shown in
Ex1ribil'D' to this Agreement.
1.3. 'Affordable Very Low Income Rerd" shall mean annual rentals (not
including a reasonable utility allowance) whose amount does not exceed
the maximum percentage M income that can be devotetl to rent as set
forth by the U.S. Department of Housing and Urban Development
("HUD"), or Its successor, which is cuff entry thirty-five percent (35%) of
fifty percent (50%) of the annual median Income for the Fresno
Metropolitan Statistical Areas adjusted for the family size appropriate for
the Unit.
1.4. 'Affordable Lower Income Reny shall mean annual rentals (including a
reasonable Utility Allowance) whose amount does not exceed the
maximum percentage of Income that can be devoted to rent as sat forth
by Callfomia Health & Safety Corte Section 50053 (b)(3), or its successor.
which is currently thirty percent (30%) of sixty pement (60%) of the annual
median Income for the Fresno Metropolitan Statistical Area adjusted! for
the family size approprate for the Unit
1.5. 'Affordable Rent" shall refer to Affordable Vary Low Income Rent act
Affordable Lower Income Rent.
Page 5
1.6. 'Agency' means the Redevelopment Agency of the Cry of Fresno, a
public hotly, corporate and politic, oryanized and existing under the
California Health 8 Safety Cape Section 33000 at seq., and any
assignee of or successor to IN rights, powers and responsibilities.
1.7 'Agency Assistance' shall mean the Agency Loan Guaranty as defined In
Section IS below, as well as any Agency Tax Increment or Low and
Moderate Income Set -Aside funds used to cover debt service shortfalls or
for Agency4unded capital improvements to the Project.
18. 'Agency Loan GuaanV means a loan guaranty of a promissory note by
an afiliate of the Properly Seller. Inland Mortgage Capital Corporation, In
an amount of One Million, Nine Hundred Thirty -Seven Thousand, Seven
Hundred Ninety -Six Dollars ($1,937,796.00) made by Agency to Owner
as a contribution towards the Project, upon the terms and conditions set
forth in tine Agreement and the Loan Guaranty shown in Exhibit "G' of
this Agreement.
1.9. -Agreement' means this Operating Agreement, including all agreements
shown In the exhibits and mounted by reference.
1.10. 'Budget' means the BudgeVRnandal Plan for the Property attached
hereto and incorporated herein as Exhibit 'C' (me'BudgeF).
1.11. 'Ceriitiwle of Completion' means that Ceriffate issued in the fans
attached as Exhibit -D' to Owner by Agency evidencing completion of the
Prop" for Purposes of this Agreement
1.12. 'City of Fresno' or 'City' shall mean the City of Fresno, California, a
Charter City.
1.13. 'Community Development Block Program' refers to the program of the
United States Department of Housing and Urban Development('HUD'),
of which the Neighborhood Stabillrabon Program Is a subcomponent,
enacted under Title I of the Housing and Community Development Act of
1974.
1.14. "Day' whether or not capifallzed, means a calendar day, unless stated
otherwise.
1.15. "Eligible Very Low Income Tenant' shall mean those tenants whose
household Incomes do not exceed fifty percent (50%) of the annual
median income for Me Fresno Metropoilran Speediest Area,
1.16. 'Eligible Lower Income Tenant' shall mean those tenants whose
household Incomes do her exceed eighty percent (80%) of the annual
median income for the Fresno Metropolltan Statistical Area.
1.17. 'Eligible Over Income Tenant' shall mean those tenants whose
occupancy at the Property precedes the aceuisition of the Property by
Owner and the recordation of these Restrictions, but whose household
incomes exceed eighty percent (80%) of the annual median income for
Me Fresno Metropolitan StatisBcal Area for Me household size, and which
household the Owner has determined would be Infeasible to relocate
under the Federal Uniform Relocation Act ('UW), 49 CFR Pad 24 or
HUD Regulations Section 104(d).
1.18. "Eligible Tenant' shall mean a Very Low Income Tenant or a Lower
Income Tenant An Eligible Mar Income Tenant is an Eligible Tenant.
1.18. 'Fresno Metropolitan Statistical Area Median Income' shall be determined
by reference to the calculattons published by HUD,
1.20. 'Default' means a party's failure to timely perform any action or covenant
required by this Agreement following notice and opportunity to cure.
1.21. "Direclof means the Executive Director of Agency.
1.22. "Effective Date" means the date of complete execution of the Agreement
following the Agency Board approval thereof.
1.23. 'Environmental laws' means any federalstate, or local law, statute,
ordinance or regulation pertaining to environmental regulation,
contamination or cleanup of any Hazardous Materials or waste Including,
without limitation, any state or federal lien or 'super lien" law, any
environmental cleanup statute or regulation, or any governmentally
required permit, approval, authorisation. license, venance or permission.
124; 'Funding Source' means the loan made to the Owner by Me City of
Fresno ('NSP Loan') and the sellers note made by Inland Mortgage
Capital Corporation, ("Seller's Nota') along with any Agency Assistance
and other funding sources secured by Owner to acquire, operate or
renovate the Improvements as shown In Exhibit -C.-
1,25
CJ1.25. 'Finandmg Plan' means the Budget Including seurces and uses of funds
sufficient for Owner to acquire, operate or renovate Improvements
according to the Basic Program of Work as described In Exhibit -L'
1.26. 'Hazardous Materials' means any substance, material, or waste which Is
or becomes regulated by any Iacal govemmental authority, the State of
California, or the Unded States Govemment including, without limitation,
any material or substance which is. (a) defined as a "hazardous waii
'extremely hazardous waste; or 'restneted hazardous waste" under
Sections 25115. 25117, or 25122 7, or listed pursuant to Section 25140 of
the California Health and Safety Code; (b) defined as a 'hazardous
substance' under Sestion 25316 of the California Health and Safety
Code, (c) defined as a 'hazardous material; 'hazardous substance,' or
'hazardous waste' under Section 25501 of Me Calrfomia Health and
Safety Code; (d) defined as a 'hazardous substance" under Section
25281 of the California Health and Safety Cope; (a) petroleum; (1) friable
asbestos: (g) Folychlonnoted byphenyla; (b) listed under Artlde 9 or
defined as 'hazardous or "extremely hazardous' under Article 11 of This,
P,d, 7
22, California Administrative Code; (i) designated as 'hazardaus
substances' pursuant to Section 311 of the Clean Water Act (33 U.S.C.
§1317), 0) tallest as a "hazardous waste" pursuant to Section 1004 of
the Resource Conservation and Recovery Act (42 US.0 §6901 at ser.);
or, (k) darned as 'hazardous substances' pursuant to Section of the
Comprehensive Environmental Response, Compenswein, and Liability
Act (42 US.C. §%01, of seq); provided, however hazamous materials
shall not include: (1) construction materials, gardening molenals,
household products, ogre supply products or janitorial supply products
customarily used In the construction, maintenance, rehabillumon, or
management of residential rental housing or associated buildings and
grounds, or typically used in household activities, in a manner typical of
other residential rental housing developments which are comparable to
the Improvements; and (2) certain substances which may contain
chemicals listed by the State of California pursuant to Health and Safety
Coda Sections 25249.6 at seq., which substances are commonly used by
a significant portion of the poplation Irving within be region of the
PropdY, including, but not limited to, alcoholic beverages, poorly,
tobacco products, NubaSweet and saccharine.
1.27. 'Household" means one or more persons occupying a Unit
1.26. 'Housing Set -Aside Funds" means those California Health and Safety
Code Section 33334.2 monies held and administered by Agency, a
portion of which shall be used m provide the Loan Guaranty to Owner for
eligible costs and expenses incurred by Owner in acquiring and
renovating the Improvements in such amounts, and upon such terms and
conditions specified in this Agreement.
1.29. 'Improvements' mean the Units Gainer will acquire, operate and renovate
on the Property. Including associated fencing, pools, recreation areas,
palling lots, and landscaping Improvements -
1 30. 'Initial Leasesi Period' The period of lime after Owner has closed
escrow on the Property from Sellar and undertakes (a) the leasing of
uncant units to Income-quall0etl households; (b) the leasing of the si
its requiring significant renovation and rehabilitation; and (c) the
Process of income -qualifying existing tenants living at the Property. The
Parties expect the lnitel Lease -up Penatl to he complete by September
30 2010.
1.31. "Law- means the Community Redevelopment low of the state (Celtomis
Health and Safety Code Sections 33000 at seq.)
1.32. 'Loan Documents" means collectively Nis Agreement, Me Sepses Note.
the NSP Agreement, the Loan Guaranty Agreement, the Goods of Trust,
and all exhibits and attachments thereto as they may be amended
modified or restated from time b time.
1.33. The term "Managers Unit' or 'Management Representative's Unif shall
mean the one (1) unit of the Property Nat shall be designated by Owner
18
as a residence for a "Qualified Manager or 'Quell Management
Representative" The Manager's Unit shall not be an income-rasttictetl
Unit.
1.34. 'Material Change- means a change, moddical revision or alienation to
the Loan Documents that significantly deviates from those previously
approved by me Agency, provided that fully funded changes) which do
not result in a change in the number or type (i.e. residential, affordable
and commercial) of Units andlor an increase in the total Agency
Assistance funding provoked! In his Agreement shall not constitute
Material Change(s).
1.35. "Neighborhood Stabilization Program' or "NSP' shall mean a program
administered by the City of Fresno resulting from he Congressional
adoption of Title III of the Housing and Economic Recovery Act (HERR) of
2066. NSP is a subcomponent of the Community Development Block
Grant Program (CDBG) administered by HUD and provides entitlement
gran% to state and local communities to purchase foreclosed or
abandoned property to rehabilitate, resell, or redevelop homes or multi.
family units in an effort to stabilize neighborhoods and arrest the decline
of house values In neighboring homes.
1.38. 'Cwwr" means Fresno Revitalization Corporation. Inc. a California Non -
Profit Public Benefit Corporation.
1 3, "Plan" means the Redevelopment Plan for the Merged Project Area No, 1
Project Area.
1.38. 'Project means the acquisition of 118 residential units; the full renovation
of no fewer then six (6) units; and associated public area improvements
as more particularly described In Exhibit "E". Upon completion of the
Project, Owner will implement an on-going program of unit upgrade upon
vacancy.
1 39. "Project Area' means Merged Project Area No 1.
1,40. 'Project Completion Date' means the date that Agency shall have
determined he Project has reached completion in accordance with the
scope of work described in the Basic Program of Work attached as
Exhibit 'P, as evidenced by Agency's tssuarwe of a Certificate of
Completion, and shall be no later than July 31. 2010.
141 'Property' means the real property described in Exhibit "A'.
1.42_ The term 'Qualified Manager" shall mean the resida t Property Manager
selected and retained by owner pursuant to he Regulatory Agreement.
The Qualified Manager shall reside In he 'Manager's Unit" designated by
Owner or shall designate one unit as a "Management Repesen%Ove s
Unit" for an employee of Qualified Manager charged with on-site and
after-hours duties. The Managers Unit shall be rermcted to occupancy
by the Qualified Manager and their households, but shall not be subject to
any income restriction.
143. 'Basic Program of WOW means the schedule attached as Exhibit 'E,'
ening forth the dates and times by which the parties must acoompllsh
certain obligations under this Agreement. The pages may revise the
Basic Program of Work from time to time on mutual when agreement of
Owner and Agency, but any delay or extension of the Completion Date Is
subject to the requirements in this Agreement.
1.44. The term 'Regulatory Agreement" shall mean that Regulatory Agreement
attached hereto as Exhibit "P, running with the land and prov ding for the
proper maintenance of common facilities and Improvements and the
management and use of Me Property and to ensure the Restricted Units
remain affordable pursuant to Me terms of this Agreement.
1.45. "Release of Restrictions' means a release of those covenants, bandit
and restrictions contained in this Agreement.
1.46. "Resthcted Units" shall refer to a total of ane hundred seventeen (117)
units of which (a) seventy one (71) residential units shall be reserved for
Eligible Very Low Income Tenants at rents not exceeding the Affordable
Very Lary Income Rent; and, (b) forty-six (46) residential units shall be
reserved for eligible Lower Income Tenants at rents not exceeding the
Affordable Lower Income Rent; as more particularly described in Me
Regulatory Agreement adached hereto as Exhibit -F-
1,47.
F147. 'Security Financing Interest means a security interest which Owner
grants in Me Property and rite Improvements "man before Me Agency
issues and records a Release of Restrictions.
148. 'Sell shall mean IMCC Canyon Creat, LLC, a Delaware Unrest Uabilily
Company.
1.49. "Unit", as used in this Agreement, shall refer to any of the one hundred
eighteen (118) residential units in Me Property.
2. RESTRICTIONS UPON TRANSFER. Except as may be expressly
provided herein, all of Me terms, covenants and conditions of this Agreement shall be
binding on, and shall inure to the benefit of. Owner and Me permltled successors.
assigns and nominees of Owner, Wherever the term'Cwner' is used herein, such teem
shall Include any permitted successors and assigns of Owneras herein provided
2.1 Qualifications of Owner The qualifications and Identity of Owner
e of particular concern to the Agency, particularly with the relationship
between Owner and Agency, and it is because of such qualifications and
identity that Agency has entered Into this Agreement with Owner. Based
upon these consitlemtions, the Agency has imposed Mose restrictions on
transfer set forth in Mis Agreement.
Pep, 10
2:2 Restrictions on Tunisia . Prior to issuance of the Candidate of
Completion, Owner shall not Transfer this Agreement or any of Owners
rights hereunder, or any Interest in the Property or in the Improvements
thereon, directly or indirectly, voluntarily or by opembon of law, except as
provided below, without the prior written approval of Agency, and If so
purported to be Trensfened, the same shall be null and void. In
considering whether It will grant approval to any Transfer by Owner of its
interest In the Property before the issuance of the Certificate of
Completion, wMch Transfer manures Agency approval, Agency shall
consider factors such as (i) whether me completion or implementation of
the Project is jeopardized, (11) the financial strength and capability of the
propoeed assignee to perform Cwners obligations hereunder; and (Iii) the
proposed assignee's experience and expertise in the planning, financing,
development. ownership, and operation of similar projects. In fall no
attempted assignment of any d Owners obligations hereunder shall be
effective unless and unfit the successor party executes and delivers to
Agency an assumption agreement in a form approved by the Agency
assuming such obligations. After the Issuance of a Certificate of
Completion, the restrictions upon Transfer by Owner are contained In the
Regulatory Agreement shown in Exhibit "F
2.3 Exceptions. The foregoing prohibition shall not apply to any of the
following:
a. Any mortgage, dead of Wst, or other form of
conveyance for financing, as provided in barren 3, but Owner shall notify
Agency In advance of any such mortgage, dead of bust or other form of
conveyance for financing pertaining to the Property.
b. Any mortgage, dead of twat, or other form of
conveyance for restructuring or refinancing of any amount of
Indebtedness depended in subsection (a) above, provided Nat the
amount of indebtedness incurred in the restructuring or refinancing does
not exceed the outstanding balance on the debt incurred to finance the
acquisition or and the construction of the Improvements on the Property,
Including any peripheral costs for completion of constnu on, whether
direct or Indirect based upon the estimates of architects. and/or
contractors.
The granting of easements te any appropriate
governmental agency or utility or permits to facilitate the development of
the Pmperty.
of A sale or transfer resulting from or In connection with
a reonganiiatlon as contemplated by the previsions of the Internal
Revenue Cotte of 1986, as amended or otherwise, in which the
ownership interests of a corporation are assigned directly or by operation
of law to a person or persons, firm or corporation which acquires the
control of the voting capital stock of such corporation or all or substantially
all of the assets or such corporation.
Page 11
e. A sale or transfer between members of the same
Immediate family, or Vansfers to a trust, testamentary or otherai In
which the beneficial consist solely of immediate family members of the
Trustor or hansfers to a corporation or partnership in which Me immediate
family members or shareholders of the install have a controlling
ma(odty interest of 51% or more.
I. A sale or transfer to a Qualified Tax Credit Investor,
provided that such Qualified Tax Credit Investor shall be In a non -
managing rola
g. A sale or transfer of general partner interests to a
nonprofit general partner.
In A sale or transfer of general partner interests to a
nonprofit general partner.
2.4 Allowed Transfer. Owner may assign its ights, duties and
obligations, His and Interest under I Agreement to a wholly owned single purpose
subsidiary of Owner, subject to written approval by Agency. However, in the event of
such assignment as provided herein. Owner Is in no way relieved of any of its
responsibilities, and shall remain fully responsible and liable to Agency under Na all
of this Agreement and all related agreements, and Owner shall retain full con"I and
responsibility for the Project
3. ACQUISITION OF THE PROPERTY. The Property is currently owned
by the Seller and was delainetl through a foreclosure process. Seller shall convey Me
Property to Owner and Owner shall acquire the Property from Seller, upon the terms and
conditions set forth in an Agreement for Purchase and Sale of Real Property between
Seller and Owner, which form is included in Exhibit "H' of this Agreement The Agency
has agreed to provide a Loan Guaranty of a Sellars Note to Owner for the acquisition of
the Property In the amount of One Million. Nine Hundred Thirty Seven Thousand Seven
Hundred Ninety,Slx Gonave ($1,937.791 The conveyance of the Property shall be
by the form of a Grant Dead. Consideration for the Loan Guaranty shall be Me
Performance of the forms and conditions of Ms Agreement Including the Regulatory
Agreement shown in Exhibit "F" of this Agreement.
In addition to Me Sellers Nate, Me Owner shall enter an Agreement with the City
of Fresna ("NSP Agreemenr) under which the City shall make a loan from Its
Neighborhood Stabilization Program ("NSP Loan')in the amount of $2,772,253 under
the terms and conditions of the NSP Agreement, attached as Exhibit -L to this
Agreement
Thetotal cost of the Property as approved by Agency. inclining acquisition and
renovation, is estimated W be Four Million Seven Hundred Thousand Dollars
($4,700.000).
4. AGENCY PARTICIPATION IN PURCHASE ESCROW. Escrow shall be
opened within Me time period specified in the Purchase and Sala Agreement. Agency
and Owner shall promptly prepare, execute, and deliver la the Escrow Agent such
Paye 12
additional escrow Instructions related to the Loan Guaranty consistent with the terms
herein as shall be reasonably necessary.
4.1 Ageni Conditions to Loan QuaranN. Agency's obligation to
provide a Loan Guaranty, shall, In addition to any other conditions set
forth herein in favor of Agency, be conditional and contingent upon the
satisfaction, or waver by Agency, of each and all of Na following
conditions (collectively the "Agency's Conditions to Closing'):
I. Title shall be conveyed to Owner in a good condition, free
and dear of all liens, encumbrances, clouds, conditions, rights of
occupancy and possession, except those conditions reoded in the
Regulatory Agreement, the Seller's Deed of Trust. the City's Dead of
Trust, and to Loan Guaranty.
Owner shall hove obtained approval of financing
commitments including the Clry NSP Agreement and the Settees Nota
for the acquisition and renovation of the Property In accordance with
Section 3, and Agency shall have approved such commitments.
m. Seller shall have deposited into escrow all the required
documents.
Owner shall have approved the physical and
environmental condition of the Property.
Owner shall have deposited into escrow all the required
documents.
Any waiver of the foregoing conditions must be express and in writing. In
the event that Owner fails to satisfy Agency's foregoing conditions or
defects In the performance of its obligations hereunder and such failure
or default continues beyond the notice and cure period set form in
Section 14 of this Agreement, Agency may withhold the Loan Guaranty.
The Loan Guaranty shall be In an amount of One Million, Nine Hundred
Thirty -Seven Thousand Seven Hundred NlnetySix Dollars
($1,937,798.00), rmrh-recourse, upon me terms contained herein and in
the Seller's Note, included in this Agreement as E:e hibit -1'
4.2 Evidence of Financial Caoabll'N. Owner shall submit to Agency's
Executive Director for approval evidence that Owner has to financial
capacity necessary for the acquisition and renovation of the Property
pursuant to this Agreement. Such evidence of financial capability shall
include all of the following'
Documentation that Owner has secured the Seller's Note.
and the City NSP Nate.
Page 13
Reliable cost estimates for Owner's total cost of acquiring
the Property and developing the Project (including both 'hard' and
'soft' ousts).
A financial statement and/or other documentation
reasonably satisfactory to the Executive Director sufficient to
demgmtrate that Owner has adequate funds available to cover the
difference between the total acquisition and renovation costs of the
Property and the proceeds of the NSP and Sellers loan commitments.
A copy of the proposed contract between Owner and its
general contractor for all of the improvements required to be made by
Owner hereunder, certified by Owner d be a true and correct copy
thereof. The Agency shall also have the right to review and approve
any revisions that are made to the proposed centred after its approval
by the Executive Director.
Owner covenants and agrees to take all action, fumish all
information, give all consents and pay all sums maecnably required to
keep the construction loan commitment In full force and effect and
shall comply with all conditions thereof, and shall promptly execute,
acknowledge and deliver all applications, credit applications and data,
financial statements, and documents reasonably required In
connection therewith.
5. AFFORDABILITY RESTRICTIONS. Upon attaining required firuncing
and closing sectors on the Property as described herein, Owner agrees to recent the
Regulatory Agreement whereby a total of one hundred seventeen (117) units plus one
(1) unrestricted Manager's Unit shall be restricted for fifty-five years (55), with seventy-
one (71) units restricted for fennel to households of Very Low Income and forty-six (4B)
units restricted for fifty-five years (55) for rental to households of Lower Income, all as
described in the Regulatory Agreement Included in this Agreement as Exhibit 'F.'
5,1 Effect of Covenants. Al covenants set forth in the Regulatory
Agreement without regard to technical classification or designation shall
ba binding for the benefit of 0e Agency, and such covenants shall run in
favor of the Agency for the entire pared during which such cants
shall be In forte and effect, without regard to whether the Agency is or
remains an owner of any land or interest therein to which such covenants
relate. The Agency, in the event of any breach of any such covenants,
shall have the right to exercise all the rights and remedies and to maintain
any actions at law or sults in equity or other proper proceedings to
enforce the wring of such breach.
5.2 Covenants Run With the Land The Owner covenants and agrees
for Itself. Its successors and assigns, which covenants shall run with the
land for the period of the Regulatory Agreement and bind every
successor or assign In interest of Owner, Nat during acquisition and
novation of the Property pursuant to this Agreement and thereafter,
either the Property nor the improvements, nor any portion thereof, shall
Prgc 14
be improved, used or occupied in violation of any applicable
governmental netrichons or the restrictions of this Agreement.
Furthermore, Owner am Its successors and assigns shall not Initiate,
maintain, commit, or permit the maintenance or commission on the
Property, or in the improvements, or any portion thereof, of any nuisance,
public or private, as new or hereafter defned by any salutary or
decisional law applicable to the Property or the improvements, or any
portion thereof.
5.3 Property Solely Used for 51 ted Purpose. Notwithstanding
anything to the contrary or that. appears a be to the contrary in this
Agreement, Owner hereby covenants, on behalf of Itself, and Its
successors and assig which covenants shall run with the land far the
period of Me Regulatory Agreement and bind every successor and assign
in interest of Owner, that, Owner and such successors and assigns shall
use the property solely for the purpose of renovating, maintaining and
attending a residential renal project meeting the requirements and
resections of this Agreement and the Regulatory Agreement, including,
without limitations, restriction of the rental and occupancy of the
Restricted Units only to Eligible Tenants for a rent not in excess of an
Affordable Rent for the period specified herein. All Resected Units
constructed pursuant to this Agreement shall be occupied at all fines only
by the Household of the Eligible Tenant who has rented that Restricted
Unit under Me terms contained in the Regulatory Agreement, Exhibit -F.'
5A Labe o of Residences by Owner.
a -uo
LeasaPeriod. Monthly during the Initial Leese -up Period
and annually theafee, Owner shall provide Agency with a
report with respecter Restricted Units under lease, leases in
default the number and status of Eligible EverIncome
Tenants and such other information as Agency may
reasonably request
h Redriated Resistance . As set forth above, each of the
Restricted Units shall be rented to an Ellglble Tenant for a
ental rate which all not exceed an Affordable Rent for the
applicable Restricted Unit.
Annual Tenancy Report. Owner shall provitle Agency
forwally, by January 31, with a report on Property occupancy
each Resected Unit, Including information concerning the
number of months during which each Restricted Unit was
ccupled, and the income category of each tenant Household
occupying a Restricted Unit, and the number and status of
Eligible Over -Income Tenants. The annual report and Owners
cols related to each tenancy shall be subject to Inspection
and audit upon Agencys written request.
Paas 13
6. IMPROVEMENTS ON THE PROPERTY. The Property shall be improved
by Owner substantially as provided In the Basic Program of Work, attached hereto as
Exhiblt'E', Me Regulatory Agreement, and the plans and permits approved by Agency
and City pursuant to Sacton 6 of this Agreement.
6.1 Permits. Owner warrent and represents that the Otys Generel
Plan and Zoning Ordinance permits Owners proposed construction,
operation, and use of Me Property as provided in this Agreement,
including without limtiation Me Basic Program of Work, subject only to
approval of Me Property pursuant to Health and Safety Code Sections
33433. Nothing in this Agreement shell be deemed to be a prejudgment
or commitment with respect to such items, nor a guarantee that such
approvals or permit wall be issued within any particular time or with or
without any commits- conddians.
6.2 Timely S b (tial of Applications. Owner shall exercise Its
menially, reasonable effort to timely submit all documents and
information necessary to obtain all development and building approvals
from the City in a timely manner. Not by way of limitation of The
foregoing, In developing and constrocMg the Property, Owner shall
comply with all applicable development standards in Chys Municipal
Code and shall comply with all building code, landscaping, signage, and
parking requirements, except as may be permitted through approved
variances and modifications.
6.3 A Asestionce In Anpilicaton Process Subject to Owners
compliance with (t) the applicable City development standards for the
Property, and (ii) all applicable laws and regulations governing such
matters as public hearings, site plan review and environmental review.
Agency agrees to provide reasonable assistance to Owner, at no coat to
Agency, in the expeditious processing of Owners submittals required
under this Section in order Met Owner can obtain a final City action on
such matters set forth in Me Basic Program of Work. City or Agency's
failure to provide necessary approvals or permits within such time
pends, after and despite Owners reasonable efforts to submit the
documents and information necessary to obtain the some. shall constitute
an Enforced Delay.
64 Protect Rea DTC IP bl' Work-Prill wage
Requirements. Owner shell be solely responsible for all aspects of
Owner's conduct in connection with Me Project, including but not limited
W , compliance with all doral, state and federal laws including, without
limitation, as to prevailing wage and public bidding requirements, as
applicable. This Project is a'public work" project for federal purposes
including Davis Bacon and Related Acts wage requirements absent
written dtrectionldetermination otherwise by U.S. HUD or a court of
competent jurisdiction. Based thereon Owner shall cause the Project
work to he performed as a -public work.' The City Council of Me City of
Fresno has adopted Resolution No. 82-292 ascertaining the general
prevailing rate of per them wages and per diem wages for holidays and
overtime in Me Fresno area for each aafd, drunifiwfion, or type of
workman respect In Me execution of contracts for the City. A copy of Me
resolution is on file at the Office of the Coy Clerk. Actual wage schedules
are available upon request at the Cky's Construction Management Office.
Without limiting the foregoing, Owner shall ba solely responsible for the
quality, and suitability of the work completed, Me supervision of all
contrected work, qualifications and financial conditions of and
perfomance of all contractors, subcontractors, consultants and suppliers.
Any review or Inspection undertaken by Ma City with reference to the
Project and/or payroll monitoringrauditing is solely for Me purpose of
determining whether Owner is properly discharging Its obligation to Me
City, and shall net be relied upon by Owner or by any third parties as a
warranty or representation by the City as to governmental compliance
andlor Me quality of Me work completed forfbe Project.
65 CEQA. The Project has been environmentally asseseed
(Environmental Assessment No. H-2010-10) and was determined M be
cate ioncif ly excluded from review under Section 58 35 (a)(3) it and (a)(5)
of National Environmental Policy Ad (NEPA) Guidelines. Additionally,
Me Project has been assessed under the California Environmental
Quality Act (CEQA), resulting in a Categorical Exemption. Based on Me
review, City staff determined that the project is consistent with all of the
c✓ url specified for an exempdon M CEQA in accordance with Section
15301/Class 1 and 15319(b)(4) of CEQA Guidelines.
6B Financing of Improvements. The cost of constructing all of the
improvements required M be constructed for the Project shall be borne by
Owner, except for any work expressly set forth in this Agreement or has
NSP Agreement b be performed or funded by Me Agency or others.
6.7 Completion of Imoroverranls. Owner shall begin and complete all
plans, rsriews, and construction specified in Me Basic Program of Work.
Once construction Is commenced, it shall be diligently pursued to
completion, and shall not be abandoned for more than thirty (30)
consecutive days. Owner shall keep the Agency informed of Me progress
of construction and shall submit monthly to the Agency written reports of
the progress of the construction In Me form required by Me Agency.
6 Schedule of Performance. Itis understood that the Schedule of
Performance contained in the Basic Program of Work is subject to all of
Ma terms and conditions set forth In the teat of the Agreement. The time
periods set forth In the Schedule of Performance may he altered or
mended only by written agreement signed W both Owner and Agency.
Afailure by either party to enforce a breach of any particular time
proNsion shall not be construed as a waiver of any other time provision.
The Exedi Director of Agency shall have the authomy to approve
extensions of time without Agency Bosh action not M exceed a
cumulative total of tag days.
OS Agency Access to Me Property Di Construction. Until Agency
Issues the Certificate of Completion. Agency will have access to the
Property, after reasonable notice to the Avner (except in emergencies).
Page 17
without Marge or fee, during normal cunstrection hours, for purposes of
assuring compliance with MIs Agreement Agency representathres will
comply with all safety rules whlle on the Protect or the Property,
5.10 Melntenencs of Improvements. Owner fall design and construct
the Improvements, and after that, prior to any allowable transfer or sale
thereof, Owner all maintain the Property i omrd'mg to all applicable laws
Inclutling, without limitation, all applicable state labor standards, Agency
zoning and development standards, building, plumbing, mechanical and
electrical miles, all provisions of Me Fresno Municipal Code and all
applicable access requirements. Agency makes no representation about
which, if any, of such laws, ordinances, regulators or standards apply to
development of the Foal
9. CERTIFICATE OF COMPLETION. Upon fire substantial completion of all
construction required to be completed by Owner on the Property, Agency shall furnish
Owner with a Certificate of Completion for the Property in the form aftaMed hereto as
Exhibit "O" upon written request therefor by Owner. The Certificate of Completion shall
be executed and notarized so as to permit it to be recorded in the Office of Me Recorder
N Fresno County. A Ceridlmte of Completion shall be, and shall state that it constitutes,
conclusive determination of satisfactory completion of Me construction and development
of Me improvements required by this Agreement upon Me Property and of full
compliance wtih the terns of this Agreement wIM respect thereto, A partial Certificate of
Completion applicable to less than the entire Property shall not be permMetl.
After the issuance of a Certificate of Completion, any party then owning or
thereafter purchasing, leasing or other Wise acquiring any Interest In the Property shall
not (because of such ownership, purchase, leass, or acquisition) incur any obligation or
liability under this Agreement with respect to the Property, except Mat such parry shall
be bound by the covenants, encumbrances, and easements contained in the Regulatory
Agreement attached hereto- After Issuance of a Certificate of Completion, the Agency
shall not have any rights or remedies under this Agreement with respect to the Property,
except as otherwise sat forth or incorporated in the Regulatory Agreement.
Agency shall not unreasonably without a Certificate of Complefion. If Agency
refuses or fails to famish a Car ilkets of Completion within thirty (30) days after wmten
request from Owner or any entity entitled thereto, Agency shall provide a wriften
statement of the reasons Agency refused or failed to tumish a Certificate of Completion.
The statement shall also contain Agency's opinion of the action Owner must rake to
cousin a Certificate of Completion. If the reason for such refusal Is confined to the
Immediate availability of specirc items or materials ler landscaping, or other minor so -
Fall punch list" items, Agency will issue its Certificate of Completion upon the pushing
of a bond in an amount representing one hundred! My percent (150%) of Me fair value of
the work not yet completed or other assurance reasonably satisfactory to Agency.
A Certificate of Completion shall not constitute evidence of compliance with or
satisfaction of any obligation of Owner to any holder of a mortgage, or any insurer of a
mortgage securing money caned to finance the improvements, or any part thereof.
Such Cantons Of Completion is not a notice of completion as reformed to in the
California Civil Code Section 3093. Nothing herein shall prevent or affect Owner's right
to obtain a Certificate of Occupancy from the City before the Certificate of Completion is
Issued
8. MAINTENANCE OBLIGATIONS. Owner covenants and agrees for
dset, its successors and assigns, and every successor in Interest to the Property or any
pad thereof, that, affair Agency's issuance of its Certificate of Completion the Owner shall
be responsible for maintenance of all Improvements Met may exist an the Property from
time to time, including without limitation buildings, palling lots, Ilghting, signs, and walls.
in good condition and repair, and shall keep the Pherson, free from any accumulation of
debris or waste materials. The Owner shall also maintain all landscaping required in a
healthy condition, including replacement of any dead or diseased plants. The foregoing
maintenance obligations shall hen with the land in acooMance wit and for the term of
the Regulatory Agreement. Owner's fuller obligations a maintain the Property, and
Agency's remedies In the event of Owner's default in performing such obligations, a
we form In the Regulatory Agreement. Owner hereby waives any noise, public hearing.
and other requirements a the public nuisance laws and ordinances of the City that
would otherwise apply, except as specified in said Regulatory Agreement. Upon the
sale of any portion of Me Property, Owner (but not Owner's successor) shall be released
them thas. requirements imposed by this Section, and the finandal liability therefor, as on
the portion of the Property conveyed.
9. INDEMNIFICATION. Owner shall Indemnify. hold harmless and defend
Agency and each of its officers, officials, employees, agents and volunteers tram any
and all loss, liability, fines, potatoes, fenestrae, castsand damages (whether in
contract, tort or strict Iiablllty, Including but not limited to personal injury, death at any
time and property damage) incurred by the Owner, Agency or any other person, and
from any and all claims, demands and actions In law or equity (including attorneys fees
and litigation expenses), arising or alleged a have arisen directly or indirectly from the
negligent or Intentional acts or omissions, ar willful misconduct of Owner or any of its
officers. officials, employees, agents or volunteers in the performance of this Agreement.
Agency shall indemnify, hold harmless and defend Owner and each of its
officers, officials, employees, agents and volunteers from any and all loss, liability, fines,
penalties, forfeitures, costs and damages (whether in contract, tort or strict liability,
Including but not limited to personal Injury, death at any time and property, damage)
Incurred by Agency, Owner or any other person, all tram any and all claims, demands
and actions In law or equity including atomey's fees and litigation expenses), allsing or
alleged to have arisen directly or indirectly from the negligent or Intentional acts or
omissions, or willful misconduct of Agency or any of its offlcans officials, employees,
agents or volunteers in the performance of this Agreement. provided nothing herein shall
conattute a waiver by Agency of governmental immunities including Caltoml0
Government Code section 810 at seq.
Owner agrees that this Agreement shalt in no way act to abrogate or waive any
Immunities available to Agency under the Tort Claims Ad of the Sate of Caltomla.
In the event of concurrent negligence on the part or Owner or any of is bfffcars,
officials, employees, agents or volunteers, and Agency or any of its officers. officials,
employees, agents or volunteers, the liability for any and all soon claims, demands and
actions in law or equity for such losses, fines, penalties, tdeil costa acts damages
Page 19
shall be apportioned under the Slate of Califomie's theory of comparative negligence as
presently established or as may he modAled hereafter.
This section shall survive termination or expiration of this Agreement.
10, INSURANCE. Throughout the life of this Agreement, the Owner shall pay
for and maintain in full force and effect all policii ies) of insurance required hereunder
with an Insurance company either (1) admitted by the Calffonma Insurance
Commissioner to do business in the State of Caltfomia and rated! not less than -A-VII' in
Best's Insurance Rafng Guide, or (2) authoNzeJ by the Agency's Risk Manager or
hisMordesignee. The following polices of Insurance are required.
(i) COMMERCIAL PROPERTY Insurance which shall be at
least as broad as the most current version of Insurance Service
Office (ISO) Commercial Property Form CP 10 W (Cause of Loss
—Special Form), with limits of insurance In an amount equal to the
full (100%) replacement cast (without deduction for depreciation)
of the Improvements with no coinsurance penalty provisions.
Such Insumnce shall Include coverage for business income,
including 'rental value', In an amount equal to one (1) year of me
annual rent generated by are Improvements. Coverage for
business income, Including "rental value," shall be at least as
broad as the most current version of Insurams Servlet Office
(ISO) Commercial Property Form CP 00 30.
Owner shall be responsible for payment of any deductibles contained in any
insurance policies required hereunder and Owner shall also be responsible for payment
of any self Insured retentions. Any deductibles or self-insured retentions must be
declared to, and approved by, the Agency's Risk Manager or histherdesgnee
The policy of insurance required hereunder shall be endorsed to provide that the
coverage shall not be cancelled, non -renewed reduced In coverage or in limits except
after 30 calendar day written notice has been given to the Agency. Upon issuance by
the insurer broker, or agent of a notice of correlation, non -renewal, or reduction in
owatai or in Ilmifs, Owner shall human the Agency with a new certfflcate and
applicable endorsements for such policy. In me event the policy is due to expire during
this Agreement Owner shall provide a new cartifcate, and applicable endorsements.
evidencing renewal of such policy not less than 15 calendar days prior to the aver fon
date of the expiring policy.
The Property Insurance policy shall name me Agency as a loss payee. The.
Insurance required herein shall contain no spacial limitations on the scope of monsoon
afforded to the Agency.
Owner shell furnish me Agency with all certificate(s) and applicable
endorsements affecting coverage required! hereunder. All certlfrcates and applicable
endorsements are to be received and approved by the Ageni Risk Manager or
h4/har dasignse prior to the Agency's execution of this Agreement. Upon request
of the Agency, Owner shall Immediately furnish the Agency wit a complete copy of any
insurance policy required under this Agreement, including all endorsements, with said
Paye 20
copy Wished! by the underwnter to be a true and correct copy of the original pWicy. This
requirement shall survive expiration or tarminatbn of this Agreement
Any failure to maintain the required insurance shall be sufficient cause for the
Agency to terminate this Agreement. No action taken by the Agency hereunder shall In
any way relieve Owner of its responsibilities under phis Agreement.
10.1. Nan-canpetiafon of Policies All policies of insurance required
hereunder shall be endorsed to provide that the coverage shall not be
cancelled, non-renmvai reduced in coverage or in limits except after 30
calendar day written notice has been given to Agency. Upon issuance by
the insurer, broker, or agent of a notice of canrellatlon, non -renewal, or
reduction In coverage or in limivs, Owner shall furnish Agency with a row
cendicate and applicable endorsements for such policy(ias). In the event
any policy is due to expire during the term of this Agreement, Owner shall
provide a new canRcate, and applicable endorsements, evidencing
renewal of such policy not lass than 15 calendar days prior to the
expiration date of the expiring policy.
102 Aaencv is Loss Prose. The Builders Risk (Course of
Construction) and Fire and Extended Coverage insurance policies shall
be endorsed to name Agency as a lass payee,
10.3 Endorsements. Owner shall furnish Agency with all misiccus(s)
and applicable endorsements affecting coverage required! hereunder.
All certRcelBs and applicable endorsements are to be received and
approved by the Agency's Risk Manager or his/her designee prior to
Agencys execution of this Agreement.
10.4 Failure to Maintain Insurance. If at any time Owner falls to
maintain the recollect insurance in full force and efleW, Owner shall
immediately discontinue all work under this Agreement until Agency
receives notice that the required Insurance has bean restored to NII force
and effect and that the premiums therefore have been mid far mnotl
satisfactory to the Agency. Owner's failure to maintain any required
insurance shall be sufficient cause for Agency to terminate this
Agreement.
10.5 No Release from li bll'N. The fact that insurance is obtained by
Owner shall not be deemed to release or diminish the liability of Owner,
intruding. without limitation, liability under the indemnity provisions of this
Agreement. The duty to indemnity Agency, City and each of their
officials, officers, employees, agents and colonial shall apply to all
Balms and liability regardless of whether any insurance policies are
applicable, The policy limits do not act as a limitation upon the amount of
Indemnification to be provided by Owner, Approval or purchase of any
Insurance contracts or policies shall in no way relieve from liability nor
limit the liability of Owner.
The Owner agrees that the provll of this Section shall not be
construed as limiting in any way the extent to which the Owner may be
Peyc 21
hold responsible for the payment of damages to any persons or property
resulting from the Owners activities or the densities of any person or
persons for which the Owner is otherwise responsible.
10.0 Bisquenot for Policies. Upon request of Agency, Owner shall
Immediately furnish Agency with a complete copy of any insurance policy,
required under this Agreement, including all endorsements, with said
copy Palmed by the underwriter to Da a add and correct copy of the
original policy. This requirement shall survive expiration or termination of
oris Agreement.
11. LIENS AND TAXES.
11.1 Players Liens Until the date Owner is enthled to the issuance by
Agency of a Centigrade of Completion, Owner shall not place of allow to
be placed thereon any mortgage, trust dead encumbrance or lien (except
mechanic's liens prior Is suit to foreclose the same being filed) problbded
by this Agreement. Owner shall remove or have removed any levy or
attachment made on the Property, or accord me satisfaction thereof,
within a reasonable time, but in any event poor to a sale thereunder.
Nothing herein contained shall be deemed m prohibit Owner from
carousing the validity or amounts of any tax, assessment, encumbrance
or lien, nor to limit the remedies available to Owner in respect thereto.
Owner will take reasonable efforts to not pean0 any lien or stop notice to
be Bled against the Property, Provided Owner may reasonably determine
to contest any such lien or step notice. If a claim of lien or stop nonce is
occurred against the Property or Improvements, Owner. within 30 days
after recordation of a claim of lien or stop notice or within 5 days after
Agency's demand, whichever First occurs, will do the fallowing:
a. Pay and discharge the same: or
b. Effect the release of such lien by recording and delivering
to Agency a surety mil in suf dent form and amount (i.e.
150%), or otherwise; or
C. Give Agency other assurance which Agency, in Its sole
d'rscreoen, deems satisfactory to pmi the Agency from
the effect of the lien or Will stop notice
11,2 Properly Taxes. Owner shell pay, when due, all real estate taxes
and assessments assessed or levied subsequent to conveyance of title.
Nothing in this Agreement shall prevent owner from petitioning the County
of Fresno for a welfare. exemption from property taxes basest on the
Percentage of affordable units in the Property.
12. MORTGAGE PROTECTIONS. No violation or breach of the covenants,
conditions, restrictions, provisions or limitations contained In this Agreement shall defeat
or render Invalid or In any way Impair the lien or charge of any mortgage or deed of trust,
provided however, that any subsequent owner of the Property shall be bound by such
Page 22
remaining covenants, conditions, restrictions, limitations and provisions, whether such
owners the was acquired by foreclosure, dead in lieu of foreclosure, bustee's sale or
otherwise.
12.1 Permitted Monaa his Notwithstanding the esrctions on transfer
in Section 2.2, mortgages required for any reasonable method of
financing of the construction of the improvements are permMed before
issuance of a Certificate of Completion but only for the purpose of
securing loans of funds used or to be used for financing the acquisition of
the Property, for the construction of improvements thereon, and for any
other it p rrdltures necessary and appropriate to improve the Property
under this Agreement, or for restructuring or refinancing any for same, sc
long as the refinancing does not exceed the then outstanding balance of
the existing financing, including any additional costs for completion of
construction, whether direct or indirect, based upon the estimates of
architecN and/or contractors. The Owner (or any entity permitted to
acquire titre under this Section) shall notlly the Agency In advance of any
mortgage, g the Owner or such entity proposes to enter into the same
price issuance of the Certificate of Completion. The Owner or such
entity shall net enter Into any such conveyance for financing without the
pdor written approval of the Agency, which appmval shall not be
unreasonably withheld or delayed Any lender approved by the Agency
shall not be bound by any amendment, implementation, or modification to
this Agreement subsequent to its approval without such lender giving its
pnor written consent thereto. In any event, Bre Owner shall promptly
notify the Agency of any mortgage, encumbrance, or lien that hes been
created or attached thereto prior to issuance of a Certificate of
C nnpleti0n, whether by voluntary ad of the Owner or otherwise. After
the Issuance of a Cenifcate of Completion, the limitations on
encumbrances contained in the Regulatory Agreement shall be in effect
122 Aggi Bilthts upon Failure f Holder to Complete
Improvements In any case where one hundred eighty (180) days after
default by Owner in completion of improvements under this Agreement,
the holder of any mortgage creating a lien or encumbrance upon the
Prop" or improvements thereon has not exemsed the option to
construct shouted in this Section or if it has examined such option and
has not proceeded diligently with concoction, Agency may, after ninety
(90) daysnotice to such holder and if such holder has not exercised such
option to construct within said ninety (90) day pi purchase the
mortgage, upon payment to the holder of an amount equal to the sum of
the following:
I, The unpaid mortgage debt plus any accrued and unpaid
interest (less all appropriate credits, including those
resulting from collection and application of rentals and
other income received during foreclosure proceed'egs, If
any);
nL NI expenses incurred by the holder with respect to
foreclosure, If any;
The net expenses (exclusive of general overhead),
incurred by the holder as a direct result of the ownership or
management of the property, such as insurance premiums
or real estate raves, g any;
The costs of any improvements made by such holder, if
any; and
An amount equivalent to Ne interest that would have
accrued on the aggregate of such amounts had all such
amounts become part of the mortgage debt and such debt
had continued in existence to the date of payment by the
Agency.
In the event that the holder does not exercise Its option to construct
afforded in his Section, and Agency elects not to purchase the mortgage
of holder, upon women request by the holder to Agency. Agency agrees to
use reasonable efforts to assist the holder selling the holder's interest to a
qualified and responsible party or pates (as determined by Agency), who
shall assume Ne obligations of making or completing Me improvements
required to be constructed by Owner, or such other improvemenk in their
stead as shall be sadefraory to Agency. The proceeds of such a sale
shall be applied first M the holder of those Items speed in
subparagraphs I. through v. hereinahove, and any balance remaining
thereafter shall be applied as follows
r. post, to reimburse Agency, on I% own behalf and on behalf
of the City, for all costs and expenses actually and
reasonably incurred by Agency, including but rot limited to
payroll expenses, management expenses, legal expanses,
and others.
u. Second, to mimbume Agency, on its own behalf and on
behalf of fire City, for all payments made by Agency to
discharge any other encumbrances or liens on the
Properly or to discharge or prevent from aftacbing or being
made any subsequent encumbrances or liens due to
obligations, detainer or sets of Owned, Its successors or
transferees.
III . Third, to reimbures Agency, on Its own behalf and o
behalf of the City, for all wets and expenses actually and
reasonably Inwrred by Agency in Increased with its
efforts assisting the holder In selling the holders interest In
accordance with this Section.
IV. Fourth, any balance remaining thereafter shall be paid to
Owner.
12.3 Rhalut of Apency to Cum Mortmalgis Dead of Trust or Other
Secudty Interest Oefeult In the event of a default or breach by Owner (or
Pexc 24
entity permitted to acquire title under His Section), which continues
beyond any applicable notice and cure period, of a mortgage prior to the
Issuance by Agency of a Certificate of Completion for the Property or
portions thereof covered by said mortgage, and the hostler of any such
mortgage has not exercised Its option to complete dbe development,
Agency may cure such default prior to completion of any foreclosure. In
such event, Agency shall he entitled to nambureement from Owner or
other entity of all costs and expenses incurred by Agency in curing the
default, to the extent penmtted by law, as If such holder initiated such
claim for reimbursement, including legal costs and atiomi fees, which
right of reimbursement shall be secured by a lion upon the Property ro the.
extent of such costs and disbursements. Any such lien shall be subject
to
I . My mortgage for financing parst by Mis Agreement;
and
n. My rights or interests provided in this Agreement for the
protection of the holders of such mortgages for financing;
provided that nothing herein shall be deemed to Impose upon Agency any
aRnnative obligations (by the payment of money, construction or
otherwise) with respect to the Property in are event of its enforcement of
its lien.
After the conveyance of title antl prior to the recordation of a Certificate of
Completion for construction and development. and after the Owner has
had a reasonable time to challenge, cure, or satisfy any liens o
encumbrances on the Property or any portion (hereof, the Agency shall
have the right to satisfy any such liens or encumbrances; provided,
however, that nothing In this Agreement shall regulre the Owner to pay or
make provision for the payment of any tax, assessment, lien or charge co
long as the Owner in good faith shall comest the validity or amount
thereof, and so long as such delay in payment shall not subject the
Property or any portion thereof m forfeiture or sale.
Notwithstanding anything to the contrery, contained herein, the terms and
conditions contained in this Agreement and the Regulatory Agreement
will be subordinated to the liens securing any financing permitted under
this Agreement.
13. NON-DISCRIMINATION PROVISIONS
13.1 Obligation to Retrain from Dhcrlmnan
b There shall be n
discrimination against, or segregation of, anypersons, or group of
parsons, on account of rare, color, creed religion, sex, marital status,
national origin o ancestry in the rental, sale, lease, sublease, transfer,
use, occupancy, or enjoyment of the Proi or any portion thereof, no
shall Owner, or any person claiming under or fl nough Owner, establish or
permit any such practice or practices of discrimination or segregation with
reference to the selection, location, number, use or occupancy of tenants,
"1 25
lessees, subtenants. sublessees or vendaes of pre Property or any
portion thereof (except as permitted by this Agreement). The
nondiscrimination and nonsegragatlon covenants contained harem shalt
remain in effect in perpetuity.
13.2 Eortn of alondiscaningination and Nonsidareapaten Clauses. Subject
to the tenancyloccupancy, restrictions on the Restncted Units not
prohloted by federal law as committed In this Agreement, which may
modify the following nondiscrimination clauses, express previsions shall
be included In all deeds, leases, and centrads with respect to the sale,
lease, sublease, transfer, use, occupancy, agrees, or enjoyment W bre
Project in substantially the following farm:
(a) (1) In deeds the following language shall appear—"Tho grantee
herein covenants by and for himself or herself, his or her hairs,
executors, administrators, and assigns, and all persons claiming
under or through them, that there shall me no discrimination
against or segregation of, any person or group of persons on
account of any basis listed in subdivision (a) or (d) of Section
12g55 of the Government Code, as those bases are defined in
Sections 12925, 12926.1, subdivision (m) end paragraph (1) of
subdMsion (p) of Secbon 12955, and Section 12955.2 of the
Government Code, in me sale, lease, sublease, transfer, use,
occupancy, tenure, or enjoyment of the promises herein
conveyed, nor shalt the grantee or any person claiming under or
through him or her, establish or permit any practice or practices of
discrimination or segregation with reference b the selection,
location, number, use or occupancy of tenants, lessee,
subtenants, sublessees, or vendees in the premises herein
conveyed. The foregoing covenants shall run with the land"
(2) Nalwlthstanding paragraph (1), with respect to familial status,
paragraph (1) shall not ba construed to apply to housing for older
parsons, as defined in Section 12955.9 of cre Gov smment Code.
With respect to familial status, nothing in paragraph (1) shall be
construed to affect Scott 51.2, 51.3, 51 4, 51 10. 51.11, and
7995 of the Civil Code, retailing to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1350 of the CINI Code
and subdivisions (n), (o), and (p) of Section 12955 of the
Government Coda shall apply to paragraph (1).
(b) (1) to leases the following language shall appear—The lessee
herein covenants by and for himself or herself, his or her heirs,
executors, administration; , and assigns, and all parsons claiming
under or through him or her, and this lease is made and accepted
upon and subject b the following conditions:
That there shall be no decdminatlon against or
segregagon of any person or group of persons an
account of any basis listed In subdlvleon (a) or (d)
of Section 12955 of the Government Code. as
Page 26
those bases are defined in Sections 12926,
12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955, and Section
12955.2 of the Government Code, in the leasing,
subleasing,transferdng, use, occupancy, tenure, or
enjoyment of the premises herein Issued nor Shall
the lessee himself or herself, or any person
claiming under or through him or her, establish or
Permit any such practice or proceeds of
discrimination or segregation with reference to the
selection, tocation, number, use, or occupancy, of
tenants, lessees, sublessees, sudenants, or
vendees in the premises herein leased'
(2) Notwithstanding paragraph (1), with respect to familial status,
paragraph (1) shall not be construed to apply to housing for older
persons, as defined in Section 12955.9 of the Government Core.
With respect to familial status, nothing In paragraph (1) shall be
construed to affect Sectors 51 2, 51.3, 51.4, 51.10. 51.11, and
799.5 of the Civil Code, relating to housing for senior citizens.
Subdivision (d) of Section 51 and Section 1369 of the Civil Code
end subdivisions (n), (o), and (p) of Section 12955 of the
Government Cade shall apply to paragraph (1).
(c) In contracts entered into by the Agency relating to the sale, transfer,
or leasing of land or any interest therein secured by the Agency within
any survey area or redevelopment pmject the foregoing previsions in
substantially the forms set forth shall be included and the contracts shall
further provide that the foregoing provisions shall be binding upon and
shall obligate me contracting parry or parties and any subcontracting
party or pates, or other transferees under tee instrument.
14. DEFAULTS, REMEDIES, AND TERMINATION. Subject to any Enforced
Delay, failure or delay by either party to timely perform any covenant of this Agreement
condition; a default under this Agreement, but only 0 the party who so fans or delays
does not commence to cure, carted or remedy such failure or delay within thirty (30)
days after mentor of a wreten notice specifying such failure or delay, and does net
thereafter prosecute such cure, connection or remedy with diligence to completion.
The injured path shall give written notice of default to the path in default.
specifying the default complained of by the Injured party. Except as required to protect
against further damages, the injured party may not Institute proceedings against the
party in default until thirty (30) days after giving such notice. Failure or delay in giving
such notice shall not constiNtea waiver of any default, nor shall it change the time of
default.
Except as othenvlse provided in this Agreement, waiver by either party of the
performance of any covenant, condition, or primhe, shall rot Invalidate this Agreement.
nor shall it be considered a waiver of any other covenant, condeon, or promise. Waiver
by either path of the time for performing any ad shall not constitute a waiver of time for
Pae, 27
performing any other act or an identical act required to be performed at a later find. The
delay or forbearance by either party in exercising any remedy or right as to any default
shall not operate as a waiver of any default or of any rights or remedies or to captive
such party of its right to institute and maintain any actions or proceedings which it may
deem necessary to protect, assert, or enforce any such rights or remedies.
14.1 Least Actions. In addition b any other rights or remedies, either
Party may institute legal action to cure, conal or remedy any default to
cover damages for any default, or to obtain any other remedy
consistent with me purpose of this Agreement Legal actions must be
instituted and maintained In the Superior Court of the County of Fresno..
State of California, in any other appropriate court In that county, or in me
Federal District Court in the Eastern Division of the Cenral Chat d
California.
a. The laws of that State of California shall govern the
interpretation and enforcement of this Agreement.
b. In the event that any legal action Is commenced by Owner
against Agency, service of process on Agency shall be made
by personal service upon the Executive Dressier or Secretary
of Agency, or in such other manner as may be provided by
law.
c. In the event that any legal action is commenced by Agency
against Owner, service of process on Owner shall be made in
such manner as may be provided by law and shall be valid
whether made within or without the State of California.
14.2 Rights and Remedies are Cumulative. Except as otherwise
expressly stated In this Agreement, the rights and remedles of the parties
are cumulative, and the exercise by either party of one or more of its
rights or rearranges shall not preclude the exercise by It, at the same or
different times, of any other rights or remedies for the same default or any
other default by the other party.
14.3 Specific Penomlance. In sadden to any other remedies pennided
by this Agreement, d either party defaults hereunder by failing to perform
any of its obligations herein, each party agrees that the other shall be
ended to the judicial remedy of specific performance, and each party
agrees (subject to its reserved right to carni whether In fad a default
does exist) not to challenge or contest the appropriateness of such
remedy. In this regard, Owner spa ificalty acknowledges that Agency Is
entering into this Agreement for the purpose of assisting in the
redevelopment of the Property and not for the purpose of enabling Owner
W speculate with land.
15. GENERAL PROVISIONS
15.1 Nobces Demands d Communications BegArgen the Parties.
Except as expressly provided b five contrary herein, any notice, consent,
Page 28
rei demand, document or other such item to be given, delivered,
ormahed or received hereunder shall be deemed given, delivered,
honored, and received when given in writing and personally delivered to
an authorized agent of the applicable party, or upon delivery by the
United States Postal Service, first-class registered or curdled mall,
postage preload, return receipt requested, or by a national 'overnight
courner' such as Federal Express, at the fime of delivery shown upon
such receipt: or by facsimile, If such facsimile is followed by a notice sent
out the same day by mail; in any case, delivered to the address,
addresses and persons as each party may from time to time by written
notice designate to the other and who Initially are:
Agency: Redevelopment Agency of the City of Fresno
2344 Tulare Streel, Suite 200
Fresno, CA 93921
Ado Executive Director
Owner: Fresno Revitali tion Corporation
clo Redevelopment Agency of the City of Fresno
2344 Tulare Street, Suite 209
Fresno, CA 93721
15.2 Nankabili of City and Agency Cifficull§ and Employees Conflict
of InterestCommission
a. Personal LOW . No member, cfficlal, employee, agent or
contractor of City or Agency shall be personally liable to
Owner in the avant of any default or breach by Agency or
for any amount which may become due to Owner or an
any obligations under the terms of the Agreement
provided, it is understood that nothing in this Section 15 2
is intended to limit Agency's liability.
b. Financial Interest No member. official, employee or agent
of Clry or Agency shall have any financial Interest, direct or
indirect, in this Agreement nor participate in any derision
relating to this Agreement which is prohibited by law.
c Commissions
Neither the Agency nor the Owner has
retained any broker or finder or has paid or given, and will
not pay or give, any third person any money or other
consideration for obtaining this Agreement. Neither parry
shall be liable for any real estate commissions, brokerage
fees or firulers' fees which may arise from this Agreement,
and each pant agrees to hold the other harmless hum any
claim by any broker, agent, or finder retained by such
party.
No, 29
a. Owner shall prepare and maintain all books, records and
reports necessary to substantiate ownefs compliance with
the terms of this Agreement or reasonably required by the
Agency
b. Either parry shall have the night, upon not less than
seventy-two (12) hours notice, at all reasonable times, to
Inspect the books and records of the other parry containing
to the Property as pertinent to the purposes of this
Agreement.
15.4 Assurances to Act in Good Fail Agency and Owner agree to
execute all documents and instruments and he take all action, including
deposit of funds in addition to such funds as may be specifically provided
for herein, and as may be required In order to consummate conveyance
and development of the Property as herein contemplated, and shall use
their best efforts, to accomplish the closing and subsequent development
of the Property in accordance with the provisions hereof Agency and
Owner shall each diligently and In good faith pursue the satisfaction of
any conditions or contingencies subject to their approval.
15.5 Inamriabi . The temrs of this Agreement shall be construed In
accordance with the meaning of the language used and shall not be
cogstroed for or against either party by reason of the authorship of this
Agreement or any other rule of construction which might otherwise apply.
The Simmer headings are for purposes of convenience only, and shall not
be construed to limit or extend the meaning of this Agreement This
Agreement includes all atfechmenis attached hereto, which are by this
reference Incorporated in this Agreement in their emlrery. This
Agreement also includes any other documents incorporated herein by
reference, as though fully set forth herein
15.6 Entire Agreement Wavers and AmendmenR. This Agreement
Integrates all of the terms and conditions mentioned herein, or incidental
hereto, and this Agreement supersedes all negotiations and previous
agreements between the partes arm respect to all or any part at the
subject matter hereof. All waivers of the provisions of this Agreement,
unless specified otherwise herein, must be in writing and signed by the
appropriate authorities of Agency or Owner, as applicable, and all
amendments hereto must be in will and signed by the appropriate
authorities of Agency and Owner.
15.7 Spire lith. In the event any term, covenant, condition, provision
r agreement contained herein is held to be invalid, void or otherwlse
unenforceable, by any court of competent jurisdiction, such holding shall
in no way affect the validity or snfomaabillty of any term, covenant,
condition, provision or agreement combined herein.
158 Eirearbution.
Page 30
1. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, and such
counterparts shall constitute one and the same instrument.
2. Agency represents and warrants that (i) It is
a Redevelopment Agency duly organized and existing under the laws of
the State of CalHomie; (it) by proper action of Agency, Agency has been
duly authorizetl to execute and deliver this Agreement, acting by and
through its duly authorized oRrcers; and (iii) the entering into this
Agreement by Agency does not violate any provision of any other
agreement to which Agency is a party.
3. Owner represents and warrants that (I) it
is duly organized and existing under the laws of the State or Caliromia; (li)
by proper action of Owner, Owner has been duly authorized to execute
and deliver this Agreement, acting by and through Its duly authorized
oficers: and (iii) the entering Into The Agreement by Owner does not
violate any provision plan other agreement to which Owner is a parry.
15.9 Sill of Approval. My conseme or approvals required or
permitted under this Agreement shall not be unreasonably wfthheld or
made, except where it is specifically provided that a sole discretion
standard applies.
SENO —SIGNATURES ON NEXT PAGE)
rain
IN WITNESS WHEREOF, the Agency and O ner have executed this Operating
Agreement by duly authorized representatives on the date first vantten hereinabove.
Date:
Data:
-OWNER"
FRESNO REVITALIZATION CORPORATION, e
California non-profit public benefit corporation
BY
Its.
Fresno Revitalization Corporatigl/
do Redevebpment Agency of ddat44 City of
Fresno
2344Tulare Street, Suge 200
Fresno, CA 93721
Dale: s�z,11D
"AGENCY'
THE REDEVELOPMENT AGENCY OF
THE CITY
OF FRESNO, a public body, corporate and
politic
Marlene Murphey, Exedhir D' ctor
Redevelopment Agency of the City of
Fresno
2344 Tulare Street, Suite 200
Fresno, CA 93721
ATTEST'. APPROVED AS TO FORM
REBECCA KLISCH JAMES C. SANCHEZ
Ex -Officio Clerk Ex-OFclo Aftamey
5/20/roJy{Q-�/u
Deputy 9 Deputy
Page 32
[END OF SIGNATURES]
Pagc 33
STATE OF CALIFORNIA )
)ss.
COUNTY OF
On before me. personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to be me
parsons) whose names) Islam subscribed to the wdPon instrument and acknowledged
to me that helshetlhey executed the same In hismarMeir authorized capacity(ies), and
that by hislher/their signaturi an the Instrument the Persons) or the amity upon
behalf of which the pensai acted, executed the Instrument
Witness my hand and official seal.
Notary Public
[SEAL[
STATE OF CALIFORNIA )
)ss.
COUNTY OF
On before me, . Persanally
appeared
personalty known to me (or proved to me on the basis of satisfactory evidence) to las the
persons) whose names) islare subscribed to the within instrument and acknovdedged
to me that helshetlh hl executed the same In hismerlthame aumodxed capmandies), and
that by hislher/their signaturea(s( on the instrument me persons) or the entity upon
behalf of which the persons) acted, executed the inebument.
[SEAL]
Moves my hand and official seal.
Page 34
Notary Public
STATE OF CALIFORNIA [
COUNTY OF
On before me, , personally
appeared
personally known to me (or proved to me on the basis of satisfactory evidence) to bs
The bombards) whose names) 'Ware subscribed to the within Instrument and
acknowledged to me that helshelthey executed Na same in hWherttheir authodzed
capaciMies), and that by hilt herlthese signatures(s) on the Instrument the pemon(s) or
the entity upgn behalf of which the parochial acted, executed Rte instrument.
Wanness my hand and official seal.
Notary Public
[SF1d 1
STATE OF CALIFORNIA )
) ss.
COUNTY OF
On before me; personally
appeared
personally known to me (or proved to me on the basis of satlsfaclory evidence) to
be the persen(s) whose names) islare subscribed to dre within instrument and
acknowledgetl to me that leWshanhey, executed the same in hkvlberftheir authorized
capacity(ies), and that by h'affil air mgnatures(s) on the Insbomant the persanls) or
the entity upon behalf of which the persons) acted, executed the instrument.
[SEAL[
Witness my hand and official seal.
Paye ]$
��:IJI�IYIP�
LEGAL DESCRIPTION OF PROPERTY
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF
FRESNO, COUNTY OF FRESNO, STATE OF CALIFORNIA, AND IS DESCRIBED AS
FOLLOWS:
Lots 1. 2, 3, 4 and 5 of Tract No 1938, Huntington Holmes Park, In the City of Fresno,
County of Fresno, Slate of California, acdon ing to the map thereof remMed Apol 26,
1963 in Volume 21 Pages 66, 67 and 88 N Plats, Fresno County Famous.
Excepting therefrom all all, gas, other hydreearhen substances and minerals of any kind
or chaoi In, on, or thereunder, as reserved in coeds of record.
IilL`IC!3�'lrT•ULGfi
EXHIBIT "B"
PLAT MM OF THE PROPERTY
+
9 i
g�
I FA%
FF
S
ry
Fs
� a
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}iF�T
�
3
Fg
I�
55
e
a
I'
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ry
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}iF�T
�
EXHIBIT "C"
BUDGET/FINANCIAL PLAN
Proposed Initial Renovation Costs
Proposed Saunas and Uses BE Funds
Acquisition and Rehab Project
ScAlf
Slvf
ACQUISITION
V7. IMPROVEMENTS
85W
95M
WNCRETE
LOAN FROM INLAND MORTGAGE CAPRAL
24286
242M
ESTIMATEDCLOSINGCOSTS
$15,000
TOTAL PURCHASE PRICE
$4,419,DCO
REHAB
WINDOWS
mw
a
mm
REHAB OF SIX UNITS
$1171040
EMRIOR DEFERRED MAINTENANCE
$103,ON
PESTCOWROL WORK
BUIWING
woo
124M
IM70
L"EMOR
no
76380
27190
INTERIOR
56796
a
56796
Proposed Saunas and Uses BE Funds
Acquisition and Rehab Project
ScAlf
Slvf
ACQUISITION
CM MR LOAN (ACQUISRION PORTION)
52,480,204
LOAN FROM INLAND MORTGAGE CAPRAL
$1,932,29$
ESTIMATEDCLOSINGCOSTS
$15,000
TOTAL PURCHASE PRICE
$4,419,DCO
REHAB
CRY NSP WAN (REHAB PORTION)
$292,049
REHAB OF SIX UNITS
$1171040
EMRIOR DEFERRED MAINTENANCE
$103,ON
PESTCOWROL WORK
$12,000
POOLKEPAIRS
$2Q000
CONTINGENCY
$]0,003
Proposed Operating Pro Fomes
Pro Famu MontM1N
pro Farma Annuall
RENTAL INCOME
GROSS RESIDENTIAL RENT
65.95000
79160000
IESSVACANCYAWUSTMENTS
18596601
LEVI
EFFECTIVE GROSS INCOME(EGN
59.35500
)12,260.00
OPERATING EXPENSES
PAYROLL EXPENSES ONSEE MANAGER
(41Ce.6T)
(60= GET
PAYROLL EXPENSES ON SITE MAINTENANCE
(2,71667)
(32,600.09)
ADMIN EXPENSES III MGMTF6E)
(1,229.1'n
(14,760,00)
MANAGEMENT FEES (4%o1 EGN
(2,374.20)
(28,49).40)
MARKETING/REIENFX)N
(1,16000)
(14,1EXTEE)
MAINTENANCE B REPAIR
(2,950 W)
(35,400.00)
TURNOVER EXPENSES
(1,966.87)
(23,0,60;60)
UTILITIES
(6.43258)
(77.191.00)
RESERVES FOR REPLACEMENT
(1,06867)
(23,8W.W)
INSURANCE
(250.00)
(30.00000)
PROPERTY TAXES
(4174601
051 W)
TOTAL OPERATING EXPENSES
3165712
1379885401
NET OPERATING INCOME
2789708
332,3740
INTEREST EXPENSE
1102541)1
023.0M,W)
NET INCOME/CASN FLOW
$ 17 "3 71
$209,324.55
EXHIBIT "D'
CERTIFICATE OF COMPLETION
CERTIFICATE OF COMPLETION
RECORDED AT THE REQUEST OF
AND WHEN RECORDED RETURN TO:
Redevelopment Agency of Clty of Fresno
2344 Tulare St., Suite 21X1
Fresno, Ca. 93721
Attention: Executive Director
(&`M AEM(ETIS LINE
This Canniest of Completion is recorded at the request and for the benefit of the
Redevelopment Agency of the City of Fresno and is exempt from the payment of a
recording fee pursuant to Government Cade Section 6103.
Redevelopment Agency of the
City of Fresno
By:
Marlene Murphey
Its: Executive Director
Certificate of Completion
Canyon Crest Condominiums
Recitals.
A. By an Oparedng Agreement (the "Agreement") caped I 1, 2010
between the Fresno Revirdiratian Corporation, a Call nonpmfd public banefrt
corporator ("Ownef) and the Redevelopment Agency of the City of Fresno, a public
hotly corporate and politic ('Agency"), Owner agreed to acquire renovate and maintain
certain residential units on the premises legally described in Attachment "A" hereto (the
"Property") and preserve the Affordable Units, as defined in the Agreement as rental
housing for Low and Very Low -Income Families with to assistance IN an Agency loan
guaranty while meeting Ne Affordable Housing. Income targeting and other
requirements of the Community Redevelopment law set forth at California Health and
Safety Cade Sections 33000 at seq. for a fifty-five (55) year Affordability Period
according to the terms and conditions of the Agreement.
B. The Agreement was recorded on t 1 , 2010 In the Official
Records of Fresno County, California as Instrument No.
C. Under me terns of the Agreement, after Owner completes the renovation work
on are Property. Owner may ask Agency to record a Cenficate of Completion.
U. Owner has asked Agency to furnish Owner with a recordable Certlficots of
Completion.
E. Agency's Issuance of this Certificate of Completion Is conclusive evidence that
Owner has completed the renovation work on the Property as set to& in me Agreement.
NOW THEREFORE
I . Agency cartAies that Owner commenced the renovation construction work
on the Pmjecl on I J. 2010, and completed the
construction work on the Fail 2010, and has done so in full
compliance with the Agreement.
2. This Certificate of Completion is not evidence of Owners compliance
with, or satisfaction of, any obligation to any mortgage or sa iN interest holder, or any
mortgage or security Interest insurer, securing money lent to finance work on the
Property or Project, or any part of the Property or Project.
3. This Certificffie of Completion is not a notice of compkd1 n as referred to
In Callfomia CIO Code section 3093.
4. Nothing contained herein modifies any prevision of the Agreement
IN WITNESS WHEREOF. the Agency has executed this Certificate of
Completlon as of this _ day of , R010.
Redevelopment Agency of the City of Fresno
Maden Mumhey
6 eeut'rve Directar
Owner hereby consents to recording tNs Certificate of Completion against the
Property desonbed herein.
Dated .2010
Fresno Revitalization Corporation
Its:
THE ABOVE PARTIES ARE TO SIGN THIS INSTRUMENT BEFORE A NOTARY
PUBLIC,
ATTEST: APPROVED AS TO FORM:
Ex -Officio Clank. Redevelopment Agency Ex -Officio Attomay, Redevelopment
Agency
Deputy Deputy
Dated Dated:
CONTRACTUAL SERVICES AGREEMENT
BY AND BETWEEN
THE FRESNO REVITALIZATION CORPORATION, INC.
AND THE
REDEVELOPMENT AGENCY OF THE CITY OF FRESNO
THIS AGREEMENT is made and entered into the cg0I day of May, 2010 ("Effective
Date"), by and between the FRESNO REVITALIZATION CORPORATION, a California Non -
Profit Public Benefit Corporation (hereinafter referred to as'FRC" ), and the REDEVELOPMENT
AGENCY OF THE CITY OF FRESNO, a public body corporate and politic (hereinafter refened
to as'AGENCY').
RECITALS
The series enter this Agreement based on the following facts, understandings, and intentions
WHEREAS, by authority granted under California Health and Safety Code (Cal.
HSS C.) Section 33000 at sec. (the 'Lai the Agency has prepared and Is responsible for
call out the redevelopment plan for certain Redevelopment Project Areas (the 'Planl
including as to certain priority of use of Tax Increment anmor Housing Sat Aside Funds
(collectively'Tax Increment'); and
WHEREAS, to the extent provided in or allowed by Cal. H&S.C. Sections 33334.2 and
33449, as provided by pint resolutions of the Fresno City Council and the Agency, findings and
determinations pursuant to Health and Safety Code Section 33334.2(g), the Man and limited to
the terms and conditions therein, the Agency may make improvements upon and/or construct
and improve structures in order to provide housing for Persons and families of low or moderate
income, including related on-site and off -sire improvements, by variously (1) allowing the use of
Housing Set Aside Funds outside the Airport Area Revitalization, Central Business District.
Central City Commercial Revitalization, Chinatown Expanded, Convention Canter, Freeway gg-
Golden State SouleveN Condor, FruiVChuron, Mariposa, Reeding Business Park, South
Fresno Industrial Revitalization. South Van Ness Industrial, Southeast Fresno Revitalization,
Wast Fresno I and West Fresrw II redevelopment plans; (2) restricting fire use of the Housing
Sat Aside Funds to certain of the Community Development Black Grant eligible areas of the
City: and, (3) placing a ponty on the use of the Housing Set Aside Funds from certain Project
Areas to be used either within or adjacent to the Central Plea or adjacent to certain Project
Areas: and
WHEREAS, the Fresno Revitilitation Contraction, is a California Public Beni
Corpomfioq Is exempt from federal and state income tax under Section 501 c(3) of the Internal
Revenue Code and Section 23701(d) of the California Revenue S Taxation Code for the
purpose of resisting the Agency with revitalization of the downtown area of Fresno, California:
and
WHEREAS. FRC proposes to aWuire all rights, 11" and Interest in fee to the Canyon
Crest Condominium project, that certain real property further described in Exhibit 'A' attached
hereto and incorporated herein (the "Property") pursuant to an Agreement for Purchase and
Sale of Real Property between the FRC and IMCC Canyon Crest, LLC, a Delaware Unrited
Llability Company ('Sager'), as described In Exhibit 'F' of this Agreement. The Property Is
located within the territorial jurisdiction of the Agency for the use of Low- and Moderate -Income
Housing Funds; and
Page 1
WHEREAS, the Property is a multi -family residential project consisting of one hundred
eighteen It 18) maxierhal unit. All of the units except for one Ouallfled Manager's Unit, which
will not Im income-restrictnd, are to ba considered 'Affordable Units.' Stay percent, or savary
one (71), of the Affordable Units are to be rented and preserved as Affordable Rental Housing
for households at 80% of Area Median Income or below and forty-six (48) of the Affordable
Units are t be minuet and preserved as Affordable Rental Housing for households at 80% of
Area Median Income or below; and
WHEREAS, pursuant to a Neighborhood Stabilization Program Agreement ("NSP' and
"NSP Agreement') between FRC and the City of Fresno, antretl pursuant to Ste Congressanal
adoption of This III of the Housing and Economic Recovery Act (HERA) of 2008, FRC shall
receive a WWI of $2,]]2,283 In NSP multi -family funds, SIM $2,491 set aside for the
acquisition of the Property, with the balance of $292,049 drawn down for rehabilitation and
closing costs- FRC agrees to undertake acqulsitIon and improvement in accordance with Bre
schedule of performance contained within said NSP Agreement attached and incorporated
herein as Exhiblt'B'; and
WHEREAS, pursuant to an Operating Agreement between FRC (as "FRC') and Agency
(the 'Operating Agreemem'), dated and attached and incorporated herein as
Exhibit 'C", FRC agrees to undertake improvement in accordance with Ma schedule of
performance contained wilhin sale Operating Agreement; and
WHEREAS, pursuant to One Operating Agreement. Agency has agreed to assist FRC's
acquisition of the of the Property by providing a Loan Guaranty in FRC through the use of
certain Housing Set Aside Funds In to amount of Ona Million, Nine Hundred Thirty Seven
Thousand, Seven Hundred Ninety -Six Dollars ($1,937,998.00) (the 'Wan Guamnw) upon the
terms and conditions sped8ed in to Operating Agreement and the Loan Guaranty AgreamenC
and
WHEREAS, the Agency agrees t provide administrative, financial and technical support
to the FRC in acquiring and operating the Propend; and
WHEREAS, the performance of the affordability and other covenants and restrictions set
forth in the Operating Agreement shall be evidenced by a Regulatory Agreement which shall be
recorded against and run with the Property, attached and Incorporated herein as Exhibit `D';
and
WHEREAS, FRC desires to obtain professional services to assist with to acquisition,
operation, management, renovation and re-marwitirg of the Property, and desires the Agency
to provide the services described herein; and
WHEREAS, Agency Is engaged In the business of obtaining technical and expert
services and hereby represents that It Is professionally capable of performing the saMms called
far by this Agreement.
Page 2
AGREEMENT
NOW. THEREFORE, in consideration of the foregoing and of the covenants, conditions,
and premises hereinafter contained, to be kept and performed by the respective parties, It is
mutually agreed as follows:
1. Scone of Work. Agency shall pedopn to the satisfaction of FRC, Ne services
described in Exhibit "P, attached hello and incorporated herein by reference.
�a'S —1 fffids7
a. Agency's sole compensation for satisfactory performance of all services
required pursuant to this agreement, including the Loan Guaranty, shall be ten percent (10%) of
the net operating income of the Property, defrost as Ma adjusted gross Income less the normal
and customary operating expenses incurred at the Property, before dell service; and expenses
consisting solely of Property -related expenses with acceptable supporting documentation.
b. Statements may be rendered monthly and shall be payable In the normal
course of Agency business.
C, The parties may modify this Agreement to Increase the scope of work or
provide for the rendition of services not required by this Agreement, which modification may
include an agreed-upon increase in Agency's compensation. Any increase or change In the
scope of work must bet made by written amendment to Me Agreement signed by an authorized
representative for each party. Agency shall not be entitled to any additional compensation If
work Is perform f prior to a signed written amendment.
3. Tenninationof Acreement.
This Agreement may he terminated by either party upon 30 calendar days
prior written nrfice should the other party fail substantially to observe, fulfill or perform any
obligation, covenant, term or condition In accordance with this Agreement. A party wilt have
failed substantially to obsenx, fulfill or perform any obligation, covenant, term or condition of
this Agreement. If such failure is not cared within such W calendar days prior written nonce and
this shall constitute a material default and breach of this Agreement.
b. In the event of termination pursuant b Section 3a or not due to the
material default of Agency, Agency shall be paid compensaton for services satisfactorily
padonned prior to the effective date of the notice of termination. In Me event of termination due
W the material default of Agency, FRC may withhold an amount that would otherwise be
Payable as an offset to, but not in excess of, FRC'S damages caused by such failure.
No remedy or election hereunder shall be deemed exclusive but shall,
wherever possible, be cumulative with all other remedies at law or in equity.
4. Time of Performance. The services of Agency as described in this Agreement
re to commence upon issuance of a "Notice to Proceed.- Work shall be undertaken and
completed in a sequence assuring expeditious completion, but In any event, all thea races
required by ins& Agreement shall be completed par time frame Indicated on the Scope of Work.
Page 3
5. Ownership of Documents, Any and all writings and documents prepared or
provided by FRC pumuant m this Agreement are the property of FRC and shell be turned over
to FRC upon expiration orimmination of the Agreement.
6. Emleassional Skill. It is further mutually understood and agreed by and between
the parties hereto that Agency shall perform the work agreed to be done by It under this
Agreement, and that FRC reties upon the skill of Agency to do and perform its work in a skillful
manner.
7. Indemnification. FRC shall Indemnify, hold harmless and defend Agency and each of its
officers , officials , employees, agents and volunteers from any and all loss, liability, fines,
penalties, mrfedures, costs and damages (whether in contact, tart or stflp liability, including but
not limited to personal Injury, death at any time and property damage) incurred by the FRC.
Agency or any other person, and from any and all claims, demands and actions in law or equity
(Including attorney's fees and litgatiion expenses), ani or alleged to have arisen directly or
indlrealy from the negligent or intentional acts or omissions, or willful misconduct of FRC or any
of Its officers, officials, employees, agents or volunteers in the performance of this Agreement.
Agency shall Indemnify, hold harmless and defend FRC and each of its officers,
officials employees, agents and volunteers from any and all mss, liability. fines, penaltles,
forfeitures. costs and damages (whether in contract, tort or stem liability, including but not
limited to personal injury, death at any time and property damage) incurred by Agency, FRC or
any other person, and tram any and all claims, demands and actions in law or equity (including
attorney's fees and litigation expenses), arising or alleged m have arisen directly or indirectly
from the negligent or intentional acts or omissions, or willful misconduct of Agency or any of its
officers, officials, employees, agents or volunteers in the performance of this Agreement;
provided nothing herein shall constitute a waiver by Agency of governmental immunities
including Cslifomia Government Code section 810 at sap.
FRC agrees that mis Agreement shall In no way act to abrogate or waive any
immunities available to Agency under the Tort Claims Act of ft State of California.
In the event of concurrent negligence on the part of FRC or any of its officers, officials,
employees, agents or volunteers, and Agency or any of Its offcecers, officials, employees, agents
r volunteers, the liability for any and all such claims, demands and actions In law or equity for
such losses, fines, penalties, forfeitures, costs and damages shall he apportioned untler me
State of Celgomia's theory of comparative negligence as presently established or as may be
modified hereafter.
This section shall survivor termination or expiration of this Agreement.
a. Imo@ It is understood and agreed that FRC and Agency maintain insurance
policies or self Insurance programs to fund their respective liabilities. Evidence of Insurance,
e.g., Certificates of Insurance or other similar documentation, shall not be required of eimer
parry under this Agreement.
pegs 4
I General Terms.
a. Except as otherwise provided by low, all notices expressly required of
FRC within the hotly of this Agreement, and not otherwise spedbrally provided for, shall be
effective only t signed by FRCS Acting Chairman
b. In performing the work or services to be provided hereunder, Agency
shall not employ or retain the services of any person while such person either is employed by
FRC, or is a member of to FRC board or committee. This requirement may be waived in
ening by the respective Agency Executive Director for the Agency and Acting Chairman for me
FRC if no actual or potential conflict is Involved.
C. Records of Agency's expenses straining to the Pmjed shall be kept on a
generally recognized accounting basis and shall be available M FRC or its authorrzad
representatives upon request during regular business hours throughout the life of this
Agreement and for a period or three years after final payment. In addition, all books,
documents, papers, and records of Agency pertaining to the Project shall b i available for the
purpose of making audits, examinations, exceryts, and transcriptions for the came period of
time. This Section 9c shall survive expiration or termination of this Agreement.
J. Prior to execution of this Agreement by FRC. Agency shall have provided
evidence to FRC that Agency or Agency's agents are qualied to perform the services called for
by this Agreement If Agency should subcontract all or any portion of the work to ha performed
under this Agreement, Agency shall require each subcontractor to provide evlEence m FRC that
subcontractor is licensed to perform the services called for by this Agreement (or that rid license
Is required) before beginning work.
10. Qonfid of Interest and Non -Solicitation.
a. Agency shall comply, and require any of Its subcontractors to comply,
wdh all laws and regulations including, without limitation, conflict of Interest laws, such as
Government Cade 1090 at seq., the Celtamia Political Reform Act (Government Coda Section
97100 at seq.) and tM regulations of the Fair Political Practices Commission concerning
disclosure and disqualification (2 CelBomia Code of Regulations Section 18700 at serl At any
time, upon written request of FRC. Agency shall provide a ended opinion of Its legal counsel
and that of any subcontreccur that, after a due diligent Inquiry. Agency and the respective
subcontractors) are In full compliance with all laws and regulations. Agency shall take, and
require any subcontractors to take, reasonable steps to avoid any appearance of a conflict of
Interest, Upon discovery of any facts giving nse fo the appearance of a convict of interest,
Agency shall immediately notify FRC of Mese facts in writing.
b. Agency represents and warrants that it has net paid or agreed to pay any
compensation, contingent or otherwise, direct or Inched, to solicit or procure this Agreement or
any rightsbenefils hereunder.
11. Nondiscrimination. There shall be no discrimination against, or segregation of
any persons, of group of persons, on account of race, color, creed, religion, sex, martial status,
national origin or ancestry In Me rental, sale, lease, sublease, transfer, use, occupancy, or
enjoyment of the PropeM, or any portion thereat, nor shall FRC, or any person claiming under
or through FRC, motWish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of tenants,
Page 5
lessees, subtenants, sublessees or vende ss of the Property, or any porion (hereof (except as
permrtad by this Agreement). The nondiscrimination and nonsegregation covenants contained
herein shall remain in effect In perpetuity.
Agency shall not employ discriminatory practices in Me provision of sonorous,
employment of personnel, or in any other respect on the basis of race, religious creed, color,
national origin, ancestry, physical disability, mental disability, medical condition, modal status,
sex, age, sexual orientation, ethnicity, status as a disabled veteran or veteran of the Vietnam
aa, During the performance of thk Agresim nt, Agency agrees as follows:
a. Agency will comply with all laws arM regulations, as applicable. No
person In the United Sates shall, on the grounds of race, religious teed, color, national origin,
ancestry, physical disability, mental disability, medical condltion, marital status, sex, age, sexual
orientation, ethnicity, status as a disabled veteran or veteran of Na Vietnam era be excluded
from participation in, he denied he benefits of, or be subject to discrimination under any
program or activity made possible by or resulting from his Agreement.
In. Agency will not discriminate against any employee of applicant for
employment because of race, religious creed, color, national origin, ancestry, physical disability,
mental disability, medical condition, marital stews, sax, age, sexual orientation, ethnicity, status
as e disabled veteran or veteran of the Vlemam ere. Agency shall take affirmative action to
ensure that applicants are employed, and the employees are treated during employment,
without regard to Meir uses, religious coed, color, national origin, ancestry, physical disability,
mental disability, medical condition, marital status, sex, age, sexual orientation, ethnicity, stews
as e disabled veteran or veteran of he Vietnam era. Such action shall Include. but not be
limited to, the following: employment, upgrading, demotion or transfer, recruitment or
recruitment advertising; layoff or tenninatbn; rales of pay or other forms of compensation; and
selection for training, including apprenticeship. Agency agrees w post in conspicuous places,
available to employees and applicants for employment, notices setting forth the provision of tile
nondiscrimination clause.
G. Agency will, In all solicitations or advertisements for employees placed by
or on behalf of AGENCY, stale that all qualified applicants will recelve consideration for
employment without regard to ram, religious creed, color, national origin, ancestry, physical
disability, mental disability, medical candidi marital status, sex, age, sexual orientation,
ethnicity, status as a disabled version or vatemn of the Vietnam are.
a. In the furnishing of he services providad far herein, Agency is acting as
an independent connector. Neither Agency, norn
any of its ofte, associates, agents or
employees shall be disaffect an employee, parmer
or agent of FRC for any purpose. However,
FRC shall retain the right to wady Mat Agency is performing Its respective obligations in
accordance with the more hereof.
b. This Agreement does not evidence a partnership or joint venture between
Agency and FRC. Agency shall have no authority to bind FRC absent FRC S express written
consent. Except M the extent otherwise provided In this Agreement, Agency shall bear its own
costs/expenses In pursuit hereof.
Page 6
13. Notices. My notice required or Intended to ba given to offer party under the
terms of this Agreement shall be In wilting and shall be deemed to be duly given if delivered
personally or deposited Into the United States mail, with postage prepaid, addressed to the
party b Milch notice is to be given at the palls address set fodh below or at such other
address as the parties may from time to time designate by written notice:
Agency: Redevelopment Agency of the City of Fresno
2344 Turare Street, Suite 200
Fresno, CA 93721
A": Executive Director
FRC: Fresno Revitalization Commerce
Us Redevelopment Agency of the City of Fresno
2344 Tulare Street, Suite 200
Fresno, CA 93721
14, Binding. Once this Agreement is signed by all pelves, it shall be binding upon,
and shall Inure to the benefit of, all parties, and each parties' respective heirs, successors
assigns, transferees, agents, servanh, employees and representatives.
15. Ass'onment.
There shall be no assignment by Agency of Its rights or obligations under
this Agreement without the prior written appmal of FRC. Any attempted assignment by
Agency, its successors or assigns, shall be null all void unless approved in writing by FRC.
b. FRC may assign its rights, duties and obligations, title and Interest under
this Agreement to a wholly owned single purpose subsidiary of FRQsubject b writes approval
by Agency. However, In Me event of such assignment as provided herein. FRC is in no way
relieved of any of its responsibilities, and shall remain fully responsible and liable to Agency
under Me terns of this Agreement and all related agreements. and FRC shall retain full control
and responsibility for the Project.
16. Compliance Wall taw. In providing Me services required under this Agreement,
Me Padies shall at all times comply with all applicable laws of Me United States, the State of
California and City of Fresno, and with all applicable regulations promulgated by federal, state,
regional, or Iocai administrative and regulatory agencies, now in force and as they may be
enacted, Issued, or amended during Me tens of this Agreement.
17. WeW lar. The waiver by either parry of a breach by the other of any prevision of
this Agree ent shall not constitute a continuing server or a server of any subsequent breach of
eitherthe same or a different provision of this Agreement. No provisions of this Agreement may
ba waived unless in wriiirg and signed by all parties to Mis Agreement. Waiver of any one
prevision herein shall not oe deemed to be a welver of any other provision herein.
18. Governing law and Venue. This Agreement shall b r governed by, and
construed and enforced in accordance with, the laws of the State of California. Venue for
purposes of the filing of any action regarding the enforcement or interpretation of this
Agreement and any rights and du0es hereunder shall he Fresno County. California.
Page
19. Headmils. The nation headings in this Agreement are for convenience and
reference only and shall not be mnstrued or held in any way to explain, modify or add to the
Interpretation or meaning of the provisions of this Agreement.
20. Severebil". The previsions of this Agreement are severable. The Invalidity, or
unenforceability of any one provision in this Agreement shall rot effect the other provisions.
21. Interpretation. The parties acknowledge that this Agreement in Its final form is
Me mud of the combined efforts of rhe parties and that, should any provision of this Agreement
be found m be ambiguous in any way, such ambguity shall not be resolved by construing This
Agreement In favor of or against either party, but rather by construing the farms In accordance
with their generally accepted meaning.
22. Affamev s Fees. H either party a required to commence any proceeding or legal
action to enforce or interpret any tens, covenant or condition of this Agreement, the prevailing
pant in such proteadirg or action shall be entitled to recover Prem the other party its reasonable
attomey's fees and legal expenses
23. Procedures of Documents. In the event of any conflict between the body of this
Agreement and any Exhibit or Attachment heram, the terms and condifions of the body of his
Agreement shall control and fake precedence over the terms and conditions expressed within
the Exhibit or Attachment Furthepnore, any terms or conditions contained within any Exhibit or
Attachment hereto which purport to modify the allocation of risk between the pelves, provided
for within the body of this Agreement, shall be null and void.
24. Extent of Agreement Each party acknowledges that they have read and fully
understand he contents of his Agreement. This Agreement represents Ne entire and
integrated agreement between the parties with respect to the subject matter hereof and
supersedes all pnor negotiations, representations or agreements, either written or oral. This
Agreement may be modifed only by written Instrument duly authorized and executed by both
FRC and Agency.
[END — SIGNATURES ON NEXT PAGE
Page 8
IN WITNESS W HEREOF, the Agency and FRC have executed this Contractual Sendoes
Agreement by duly authorized representafives on the date first written hereinabove.
'AGENCY'
ATTEST
FRC"
Fresno Revitalization Coiporefion
A CelMornia Non-ProN Public Benefit
Corporeten \L
By:
Its'
Data: f/Lx/fid
THE REDEVELOPMENT AGENCY OF
THE CITY OF FRESNO, a public hotly,
corporate and polific
Marlene Murphey
Executive Director SI,t IID
Date:
APPROVED AS TO FORM:
REBECCA KLISCH JAMES C. SANCHEZ
Ex-Wdo Cleric, Fresno Redevelopment Agency Ex -OR 'o Attorney, Fresno Redevalapment
Agency/� (�
By: �p�'.�nd �. J/zy/ro BY: & V&'� � a�lo
Deputy
Page 9
Exhibit A:
Legal Description of Property
Exhibd At:
Plat Map of the Property
Exhibit B'.
Neighborhood Stahilvation Progoar Agreamrnt
Exhibit C:
Operating Ag xnnmt between Agency and FRC
Exhibit D:
Regulatory Agreement
Exhibit E:
Scope of Work
Exhibit F:
Purchase and Sale Agreement
Exhibit G:
Note from Seller to FRC
Exhibit N:
Certificate of Continuing Program Compliance
Page 10
EXHIBIT "A"
LEGAL DESCRIPTION OF PROPERTY
THE LAND REFERRED TO HEREIN BELOW IS SITUATED IN THE CITY OF FRESNO.
COUNTY OF FRESNO, STATE OF CALIFORNIA, AND IS DESCRIBED AS FOLLOWS:
Lots 1, 2, 3, 4 and 5 of Tract No 1936, Huntington Holmes Park, In the City of Fresno,
County of Fresno. SOW of Cel6ornia, according to the map therad recorded April 26,
19631n Volume 21 Pages 66, 67 and 66 of Plats. Fresno County Records.
Excepting therefrom all oil, gas, other hydrocarbon substances and minerals of any kind
or character, in, on, or thereuncer, as reserved in deeds of record.
I1T� �JSri•T�Sa[
FLAT MAP OF THE PROPERTY
EXHIBIT "E"
SCOPE OF WORK
On the Effei Date of this Agreement. Mw Property is owl by the IMCC Canyon Crest,
LLC, a Delaware Limited Liability Company ('Seller'), which acquired the Property through
foreclosure. The purpose of tris Agreement is for the Agency to take all actions on behalf of the
FRC to acquire the Property from Sellar upon the terms and conditions set forth In the Purchase
and Sale Agreement, shown in Exhibit "F to his Agreement; undertake this renovation of six
gutted units at Me Property, and provide for the ongoing operason and maintenance of the
Property under Me terms of the Regulatory Agreement, shown in Exhibil'D'to this Agreement,
including Me establishment of affordability restrictions on Me unite; and, proNtle for Me
remarketing Of Me Property to a qualified affordable housing development and property
management company.
Pursuant to the Operating Agreement, shown In Exhibit 'C' b this Agreement, Mrs Agency shall
provide a Loan Guaranty of a Note from Seller to FRC (the Note Is shown in Exhibit "G') for Me
acquisition of the Property In Me amount One Million, Nine Hundred Thirty -Seven Thousand,
Seven Hundred Ninety -Six Dollars ($1,937,796.00). The convenience of the Property shell be In
the form of a Gant Deed. Considerabon for the Loan Guaranty shall be Me performance of the
terms and conditions of the Operating Agreement and the Regulatory Agreement.
In speech M the guaranty of the Seller's Note, the Agency shall undertake any and all actions
on behalf of the FRC to allow FRC to enter an Agreement with the City of Fresno, under which
Me City all make a loan from its Neighborhood Stabil tion Program In the amount of
$2,772.253 under Me terms and conditions of that Agreement, aitacri as Exhibit V to this
Agreement.
Agency shall undertake on behalf a FRC all ease necessary for the closing of Mrs acquisition of
the Property from Seller, Including but not limited! to Me preparation, execution, and dellvery to
the Escrow OFrrar, keriffed in Me Purchase and Sale Agreement, such additional escrow
instmctlons consistent with Mw terms herein as shall be reasonably necessary. These tasks
may include but are not limited to;
e. Determinegon that Title shall be conveyed In a good condition, free and clear of all liens,
encumbrances, clouds, conditions, rights of occupancy and possession, except Mose
xcepbons to He approved purcuant to Me Purchase and Sale Agreement; the Seller S
Deed of Trust; Me City's Deed of Trust; the Loan Guaranty Deed of Trust; and the
Regulatory Agreement.
b. Through Me Escrow Officer, determine Seller has deposited into escrow a constipate
(-FIRPTA Certificate-) In such farts as may be required by Me Internal Revenue Service
pursuant to Section 1445 of the Internal Revenue Coda.
c. Finalize financing commltmenis Including the City NSP Agreement, the Seller's Note,
and the Loan Guaranty for the acquisition and renovation of the Property in accordance
with the terms of the Operating Agreement.
d. Approve Ma physical and environmental condition of be Property In accordance with the
terms of be Operating Agreement.
a. Oeposlt into escrow all the documents required under the Purchase and Side
Agreement.
C Communicate wish the Escrow Officer to determine in writing the fees, charges, and
costs necessary to dear title and close escrow, and of any documents which have not
been provided by said Path and which must be deposited in Escrow to permit timely
Closing.
g. At the close of escrow, ensure FRC has received! an ALTA Policy of Title Insurance (the
"Title Policy) for the FRC's Interest, wherein the Top Company shall insure that fitie Is
be Property shall be vested in FRC, comilning no exception to such title which has rot
been approved or walved by FRC in accordance with this Section. The Title Policy shall
include any available additional title insurance, assai ed coverage or endorsements net
FRC has reasonably requested.
h. Ensure the NSP Agreement between FRC and City is recorded. which requires Mat for a
period of fifty-five (55) years from occupancy of be Affordable Units (the "Afiora liy
Period°), seventybne (71) of the Units on the Property may only ba used for the
residential use of housing subject to the terms of that certain NSP Agreement, and which
shall bind every successor or assign in Interest of FRO.
I. Ensure be Regulatory Agreement between FRO and Agency is recorded, which
requires that for a Period of fifty-five (55) years from occupancy of fire Affordable Units
(Me `Affordability Period'), one hundred seventeen (11 7) of the Units on the Property
may only be used far the residential use of housing subject to the terns of that certain
Regulatory Agreement, and which shall bind every successor or all in interest of
FRC.
Operation, Maintenance d Lanuno of Redden
As of the Effective vale of this Agreement, the Property Is managed by Pill Property
Management ('Manal which is under contact with Seller to provide on-site and off-site
property management services (the "Management Con(red"), Under this Agreement Me
Agency shall take all actions on behalf of the FRC to ensure that the Property Is operated and
maintained in a first class condition upon the terms and conditions set forth in Me Regulatory
Agreement with the currant Manager or any future manager. This includes the transitional tasks
of codifying existing apartment asses, Income -qualifying pirating and new tenants, transferring
the Management Contract to Me FRC, and acquiring a new property manager for the Property,
if necessary. The tasks undertaken by the Agency shall include but are not limited to:
a. Initial Lease-uo Period Monthly during be Initial Lease -up Period as defined In Section
130 of be Operating Agreement and annually thereafter. Agency, on behalf of FRC
and working with the contract Property Manager, prepare a report with respect to
Affordable Units under lease, leases In default, and such other information as Agency
may require as shown in the Certificaa of Continuing Program Compliance as shown In
Exhibit W to this Agreement.
b. Restricted Residences As set fodh above, Agency shall on behalf of FRC enforce Mat
each M the Affordable Units shall be rented to an Eligible Tenant for a rental rate which
does not exceed an Affordable Rent for the applicable Affordable Unit. Agency shall
cause to be produced an operations manual for the income qualification of residents and
for the transition from non -restricted units to Restricted Units, including a procedure Mat
allows Eligible Over Income Tenants as defined in the Operating Agreement ro ocoupy
Lower Income Units and the process whereupon vacated Elgible Over Income Units are
leased fo Eligible Lower Income Tenants through the income certification of such
tenants income m accordance with the Regulatory Agreement.
c. 6ontual Tenancy Rom rt. Agency on behalf of FRC shall annually, by January 31.
compile a report on Project occupancy for each Affordable Unit, Including Information
concerning the number of months during which each Affordable Unit was occupied, and
Me income category of each tenant household occupying an Affordable Unit.
d. Issas and Asaessmante. Agency on behalf of FRC shall pay, when due, all real estate
taxes and assessments assessed or levied subsequent to conveyance of tltie. Agency
shall assist FRC in Me application of a property tax waiver through Me County of Fresno,
for a percentage of taxes up to the annually income-coNfi nd percentage of residents.
e. Prooarthi Nominal . Agency on behalf of FRC shall undertake all maintenance
obligations on Me Property in accordance with and for the term of Me Regulatory
Agreement. Agency, shall assume FRC's obligations to maintain the Property, and
Agency's remadies in Me event of PRC§ default In performing such obligations, are can
forth in the Regulatory Agreement.
f. niturince. Prior to conveyance of No to the FRC, Agency shall on behalf of the FRC
Procure and maintain insurance policies required under the Operating Agreement, the
Seller's Note or Dead of Trust, or Me NSP Agreement, whichever provides for the
highest level of coverage. Agency shall procure such coverage on behalf of the FRC
during the entire term of ownership by to FRC, with such cost payable from the gross
rental receipts of the Property.
imorevements on the Proo M
As of Me Effective Date of this Agreement, the Property has six gutled units and requires heats
and safety upgrades and repairs, as described herein and In the Basic Program of Work in
Exhibit E of Me Operating Agreement. Agency shall undertake improvements on the Property
on behalf of FRC, pursuant to the Operating Agreement and Me plans and permits approved by
Agency and City. Except to the extent of the Agency Financial Assistant, the cost of
constructing all of the improvements requiretl to be constructed for Me Property shall be home
by FRC from the NSP Agreement and from gross rental receipts of the Property. The tasks
undertaken by the Agency shall include but am not limited to
a. Exercise reasonable egorts to tlmey submit all documents and Information necessary to
obtain all development and building approvals from Me City in a tamely manner.
b. Obtain all required City approvals and permits, including site plan review, conditional use
permits, builtling, grading, and landscaping as provided in the Operating Agreement.
c. Review and approve plans and drawings for all improvements to be made on the
Property, including for site plan review, building, grading, landscaping lmd other plans
and drawings, es Provided in the Operating Agreement.
J. Obtain reliable cost estimates and negotiate and prepare contracts between FRC and
general contractor for all of the Improvements inquired to be made by FRC hereunder.
Cgmpbhfnmmfth P If W R
Agency shall mullet the FRC and take all actions on behalf of FRC to comply with the obligations
related to Davis Bacon prevailing wages required in me NSP Agreement and further shown in
Section 8.4 of the Opereting Agreement:
'BA Proillotisesoons bTti 93 bl' W rk-P S R
be soler 1. FRC shall
Y responsible for-ah aspects of FRC's conduct in connection with the Pmject,
including but not limited b, compliance with all local, state and federal laws including,
without limitation, as to prevailing wage and Public bidding requirements, as applicable.
This Projact Is a 'public wink' Project for federal purposes including Davis Bacon and
Related Acts wage requirements absent written direction/desurnmation otherwise by
U.S. HUD or a court of competent Jurisdiction. Based Inanition FRC shell cause the
Protect work to be Perfumed as a'public work.- The City Council of me City of Fresno
has adopted Resolution No. 82-297 aecermining the general prevailing rate of Par diem
wages and Per diem wages for holidays and overtime in the Fresno area for each call
classification, or type of workman needed in the execution of contracts for the City. A
COPY of the resolution Is on the at the Office of the Cly Clerk. Actual wage schedules
are available upon request at the C" Construction Management Ofica.ility of the
Without
limbrg the foregoing, FRC shall be solely responsible for the quality antl suitab
work comPhred, me supervision of all contrsons
acted work, qualRca nd s and financial
conditions of and Performance of all contrectors, subconhaclors, consultants and
suppliers. Any review or inspection undertaken by the City with reference to the Project
and/or pWyroll monitoringraudding is solely for the purpose Of determining whether FRC
Is properly discharging its obligation to the City, and shall not be relkid upon by FRC or
by any third Parties as a warrant' or representation by me City as to governmental
compliance and/or the quality of the work completed for the Project°