HomeMy WebLinkAboutCDC/2003-07
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RESOLUTION NO: CDC/2003-7
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A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING
AND AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO
EXECUTE THE OLD TOWNE SINGLE-FAMILY ACQUISITION AND
CONSTRUCTION GRANT FUNDING AGREEMENT WITH CREATIVE
HOUSING SOLUTIONS, A NON-PROFIT ORGANIZATION
(ACQUISITION OF VACANT LOTS, DEVELOPMENT OF NEW
HOUSING AND POSSIBLE RELOCATION OF DISTRICT HOMES IN
OLD TOWNE).
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WHEREAS, the Redevelopment Agency of the City of San Bernardino ("Agency")
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desires to continue its efforts to revitalize and improve neighborhood housing conditions, and
provide affordable housing opportunities, particularly within the Old Towne area bounded by
6th to 9th Streets, F Street to 1215 ("Old Towne") situated within the boundaries of the Central
City North and Uptown Redevelopment Project Areas ("Project Area") in accordance with the
redevelopment for the Project Area, and also within Neighborhood Initiative Program (NIP)
Target Area #1 bounded by 13th and 18th Streets, and D Street and Sierra Way (NIP Area #1);
and
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WHEREAS, in order to facilitate its revitalization efforts, the Agency desires to enter
into a Grant Agreement ("Agreement") with Creative Housing Solutions, a non-profit
organization, ("Creative Housing") who will engage in the acquisition of vacant residential
parcels in Old Towne for the purpose of relocating and restoring the homes to be acquired by
the San Bernardino Unified School District ("District") in connection with the development of
Jones Elementary School, and or the construction of new single-family homes scattered
throughout the Old Towne. Moreover, the Agency and Creative Housing desire to continue the
Agency's efforts to buy and rehabilitate, to the extent they are available, HUD repossessions
units ("HUD Units") for the purpose of creating homeownership opportunities for first time
homeowners in the City of San Bernardino in accordance with the previously approved June
2002 License Agreement; and
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CDCj2003-7
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WHEREAS, the Agreement with Creative Housing will assist the Agency in meeting its
replacement and inclusionary housing needs in accordance with the Redevelopment Plan for the
Project Area, and further to assist in the eradication of blighted and underutilization of land
uses, and provide new and modem affordable housing opportunities for low- and moderate-
income households (the "Project"); and
WHEREAS, the Project has been determined to be categorically exempt from the
California Environmental Quality Act (CEQA) requirements, per Section 15332, Class 32; and
the Project does not require further review under CEQA; and
WHEREAS, under Section 33333.4 of the California Community Redevelopment Law,
the Agency is authorized to utilize low- and moderate-income housing funds ("Agency Housing
Fund") to expand and increase housing opportunities for households whose income do not
exceed 120% of the area median income for San Bernardino County; and
NOW, THEREFORE, THE COMMUNITY DEVELOPMENT COMMISSION OF THE
CITY OF SAN BERNARDINO DOES HEREBY RESOLVE, DETERMINE AND ORDER, AS
FOLLOWS:
Section 1. The Executive Director of the Agency ("Director") or his/her designee is
hereby authorized and directed to execute on behalf of said Commission the Agreement
between the Agency and Creative Housing.
Section 2. The Director or his/her designee is hereby authorized to appropriate up to
Two Hundred Thousand Dollars ($200,000) from the Agency's Housing Fund (2002-2003
Budget) for the purpose of implementing the Agreement.
Section 3. The Director or his/her designee is authorized to make changes to the
Agreement, provided said changes are not substantive in nature, and as approved by Agency
Special Counsel.
Section 4. The Community Development Commission has determined that the
Project is "categorically exempt" pursuant to CEQA, Section 15332, Class 32, guidelines.
Section 5. The Resolution shall become effective immediately upon its adoption.
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CDC/2003-7
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A RESOLUTION OF THE COMMUNITY DEVELOPMENT
COMMISSION OF THE CITY OF SAN BERNARDINO APPROVING
AND AUTHORIZING THE AGENCY EXECUTIVE DIRECTOR TO
EXECUTE THE OLD TOWNE SINGLE-FAMILY ACQUISITION AND
CONSTRUCTION GRANT FUNDING AGREEMENT WITH CREATIVE
HOUSING SOLUTIONS, A NON-PROFIT ORGANIZATION
(ACQUISITION OF VACANT LOTS, DEVELOPMENT OF NEW
HOUSING AND POSSIBLE RELOCATION OF DISTRICT HOMES IN
OLD TOWNE).
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I HEREBY CERTIFY that the foregoing Resolution was duly adopted by the
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Community Development Commission of the City of San Bernardino at a j t. reg. meeting
9 thereof, held on the 3rd day of March ,2003, by the following vote to wit:
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Commission Members: Ayes Navs Abstain Absent
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ESTRADA x
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LONGVILLE x
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MCGINNIS X
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DERRY X
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SUAREZ X
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ANDERSON x
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18 MC CAMMACK
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The foregoing resolution is hereby approved this --:)1)1
day of
March
,2003.
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Judith Vall, airperson
Commu' Development Commission
of the C of San Bernardino
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By:
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CDC/2003-7
OLD TOWNE SINGLE FAMILY RESIDENTIAL ACQUISITION
AND CONSTRUCTION GRANT AGREEMENT
By and Between
The Redevelopment Agency of the
City of San Bernardino
(Agency)
And
Creative Housing Solutions,
A California Non-Profit Public Benefit Corporation
(Developer)
ARTICLE I
Section 1. 01.
Section 1. 02.
Section 1.03.
Section 1. 04.
Section 1. 05.
ARTICLE II
Section 2.01.
Section 2.02.
Section 2.03.
Section 2.04.
Section 2.05.
Section 2.06.
Section 2.07.
Section 2.08.
Section 2.09.
Section 2.10.
Section 2.11.
Section 2.12.
Section 2.13.
Section 2.14.
Section 2.15.
Section 2.16.
Section 2.17.
Section 2.18.
ARTICLE III
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TABLE OF CONTENTS
Page
TERMS AND CONDITIONS............................ 1
Integration of All Agreements Relating to
the Project and Definition of Terms........... 1
Parties to the Agreement...................... 9
Prohibition Against Change in Ownership,
Management and Control of Developer and
Assignment of Agreement....................... 9
Benefit to Project Area...................... 10
List of Exhibits to Agreement................ 11
DISBURSEMENT OF AFFORDABLE HOUSING DEVELOPMENT
GRANT. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Affordable Housing Development Grant......... 11
Developer Agreement to Undertake the
Proj ect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Project Development Cost Pro Forma........... 17
School District House Due Diligence Period... 18
Acceptance by Developer of School District
Houses and Relocation and Rehabilitation of
Restored New Homes........................... 19
Sale of Completed New Homes to Qualified
Homebuyers...................................21
Final Project Cost Verification.............. 23
Agency Participation Fee in Retained
Earnings of Developer in the Project......... 24
Agency as a Party to a School District
Agreement or License Relating to any School
District House............................... 25
Minimum Conditions for any Agency License
Agreement Relating to Disposition of School
District Houses.............................. 26
RESERVED - NO TEXT........................... 32
RESERVED - NO TEXT...... . . . . . . . . . . . . . . . . . . . . . 32
Developer's Conditions Precedent............. 32
The Agency's Conditions Precedent............ 33
Satisfaction of Conditions Precedent......... 33
Representations and Warranties............... 33
Damage, Destruction and Condemnation......... 37
Developer Market Reports to the Agency....... 38
DEVELOPMENT OF THE DEVELOPER LOTS AND THE AGENCY
LOT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
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Section 3.01.
Section 3.02.
Section 3.03.
Section 3.04.
ARTICLE IV USE
Section 4.01.
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Section 4.02.
Section 4.03.
Section 4.04.
Section 4.05.
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Development by Developer..................... 39
Property Taxes and Assessments............... 46
Prohibition Against Transfer................. 47
Security Financing; Right of Holders......... 47
OF THE DEVELOPER LOTS............. ............49
Uses.......................................... .
Maintenance of the Developer Lots............ 50
Obligation to Refrain from Discrimination.... 51
Form of Nondiscrimination and Nonsegregation
Clauses. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Effect and Duration of Covenants Under Section
4.01 and Section 4.04........................ 52
ARTICLE V DEFAULTS, REMEDIES AND TERMINATION .................. 53
Section 5.01.
Section 5.02.
Section 5.03.
Section 5.04.
ARTICLE VI
Section 6.01.
Section 6.02.
Section 6.03.
Section 6.04.
Section 6.05.
Section 6.06.
Section 6.07.
Section 6.08.
Section 6.09.
Section 6.10.
Section 6.11.
Defaults - General........................... 53
Legal Actions................................ 54
Rights and Remedies are Cumulative........... 54
Damages. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
GENERAL PROVISIONS............................. 55
Notices, Demands and Communications Between
the Parties.................................. 55
Conflict of Interest......................... 56
Warranty Against Payment of Consideration for
Agreement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Nonliability of Agency Officials and
Employees. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Enforced Delay: Extension of Time of
Performance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Inspection of Books and Records.............. 57
Approvals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
Real Estate Commissions...................... 58
Indemnification. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 58
Attorneys I Fees.............................. 58
Effect. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
ARTICLE VII ENTIRE AGREEMENT, WAIVERS AND AMENDMENT ........... 59
Section 7.01. Entire Agreement............................. 59
EXHIBIT "A"
EXHIBIT "B"
EXHIBIT "c"
EXHIBIT "0"
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Legal Description of Developer Lots
Form of Notice of Agreement
Project Description/Scope of Development
Schedule of Performance
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EXHIBIT "E"
EXHIBIT "F"
EXHIBIT "G"
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Form of Section 33334.3 Covenant
School District Houses
Form of Property Owner Consent to Landscape
Assessment District Formation
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OLD TOWNE SINGLE FAMILY RESIDENTIAL ACQUISITION
AND CONSTRUCTION GRANT FUNDING AGREEMENT
THIS OLD TOWNE SINGLE FAMILY RESIDENTIAL ACQUISITION
AND CONSTRUCTION GRANT FUNDING AGREEMENT (this "Agreement") is
entered into as of March 3, 2003, by and between the
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO, a public
body corporate and politic (the "Agency") and CREATIVE HOUSING
SOLUTIONS, a California non-profit public benefit corporation
(the "Developer").
NOW, THEREFORE, FOR GOOD AND VALUABLE CONSIDERATION, THE
RECEIPT AND SUFFICIENCY OF WHICH IS HEREBY ACKNOWLEDGED, THE
AGENCY AND THE DEVELOPER HEREBY AGREE AS FOLLOWS:
ARTICLE I
TERMS AND CONDITIONS
Section 1.01. Integration of All Agreements Relating
to the Project and Definition of Terms.
(a) This Agreement integrates all of the terms and
conditions mentioned herein and supercedes all negotiations,
discussions and understandings between the parties with respect
to the Project and all items of assistance which the Agency may
hereafter provide to the Developer.
(b) In addition to the words which have defined meanings
as set forth in the preceding paragraphs of this Agreement,
certain other phrases or terms as used in this Agreement shall
have the meaning set forth as follows:
Adjusted Family Income. The words "Adjusted Family Income"
mean the anticipated total annual income (adjusted for
family size) of each individual or family residing or
treated as residing in the New Home as calculated in
accordance with Treasury Regulation 1.167(k) - 3b) (3) under
the Code, as adjusted, based upon family size in accordance
wi th the household income adj ustment factors adj usted and
amended from time to time, pursuant to Section 8 of the
United States Housing Act of 1937, as amended.
Affordable Housing Cost. The words "Affordable Housing
Cost" shall have the meaning as set forth in Health and
Safety Code Section 50052.5, as this section may hereafter
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be amended from time-to-time by the State of California. A
Qualified Homebuyer, and/or the Successor-In-Interest of
such Qualified Homebuyer, if any, shall pay no more than an
Affordable Housing Cost as its purchase price for the New
Home as of the applicable Delivery Date.
Affordable Housinq Development Grant. The words
"Affordable Housing Development Grant" mean and refer to
the grant to the Developer of certain low- and moderate-
income housing funds of the Agency in the total aggregate
amount not to exceed Two Hundred Thousand Dollars
($200,000) which the Developer shall use and apply in
connection with the redevelopment of sixteen (16) New Homes
on the Developer Lots, which shall be reserved for sale and
occupancy by Qualified Homebuyers. The amount of the
Affordable Housing Development Grant as disbursed by the
Agency to the Developer shall be subj ect to final audit
and, if applicable, adjustment, by the Agency as provided
in Section 2.05; in the event that Final proj ect Costs as
incurred by the Developer are less than the estimated
Project development costs of $2,511,231 shown in the
Project development cost pro forma on file with the Agency.
Delivery Date. The words "Delivery Date" mean the date of
delivery of title and possession of the New Home by the
Developer to the Qualified Homebuyer at the close of each
New Home Escrow.
Developer Lot. The words "Developer Lot" mean and refer to
each of the sixteen (16) parcels of land located in the
City of San Bernardino and more particularly described in
Exhibit "A", and any permitted substitutions to the listing
of the Developer Lots as provided in Section 1.04(b).
Effective Date. The words "Effective Date" mean and refer
to the date on which this Agreement has been fully executed
by the officers or representatives of the parties following
an approving majority vote of the governing board of the
Agency authorizing the execution of this Agreement by the
Agency.
Environmental Laws. The words "Environmental Laws" mean
all federal, state, local, or municipal laws, rules,
orders, regulations, statutes, ordinances, codes, decrees,
or requirements of any government authority regulating,
relating to, or imposing liability of standards of conduct
concerning any hazardous substance (as later defined), or
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pertaining to occupational health or industrial hygiene
(and only to the extent that the occupational health or
industrial hygiene laws, ordinances, or regulations relate
to hazardous substances on, under, or about the Site),
occupational or environmental conditions on, under, or
about the Site or Sales Office, as now or may at any later
time be in effect, including without limitation, the
Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("CERCLA") [42 USC Section 9601 et
seq.]; the Resource Conservation and Recovery Act of 1976
("RCRA") [42 USC Section 6901 et seq.]; the Clean Water
Act, also known as the Federal Water Pollution Control Act
("FWPCA") [33 USC Section 1251 et seq.] ; the Toxic
Substances Control Act ("TSCA") [15 USC Section 2601 et
seq. ]; the Hazardous Materials Transportation Act ("HMTA")
[49 USC Section 1801 et seq.]; the Insecticide, Fungicide,
Rodenticide Act [7 USC Section 6901 et seq.] the Clean Air
Act [42 USC Section 7401 et seq.]; the Safe Drinking Water
Act [42 USC Section 300f et seq.]; the Solid Waste Disposal
Act [42 USC Section 6901 et seq.]; the Surface Mining
Control and Reclamation Act [30 USC Section 101 et seq.]
the Emergency Planning and Community Right to Know Act [42
USC Section 11001 et seq.]; the Occupational Safety and
Health Act [29 USC Section 655 and 657]; the California
Underground Storage of Hazardous Substances Act [H & S C
Section 25288 et seq.]; the California Hazardous Substances
Account Act [H & S C Section 25300 et seq.]; the California
Safe Drinking Water and Toxic Enforcement Act [H & S C
Section 24249.5 et seq.] the Porter-Cologne Water Quality
Act [Water Code Section 13000 et seq.] together with any
amendments of or regulations promulgated under the statutes
ci ted above and any other federal, state, or local law,
statute, ordinance, or regulation now in effect or later
enacted that pertains to occupational health or industrial
hygiene, and only to the extent the occupational health or
industrial hygiene laws, ordinances, or regulations relate
to hazardous substances on, under, or about the Site, or
the regulation or protection of the environment, including
ambient air, soil, soil vapor, groundwater, surface water,
or land use.
Final Project Costs. The words "Final Project Costs" mean
and refer to the actual and reasonable costs incurred by
the Developer in the acquisition, development and
improvement of the proj ect. Final proj ect Costs include
each of the following:
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(1)
the purchase price payable by the
each Developer Lot, including
commissions, escrow fees and
insurance and the like;
Developer for
real estate
costs, title
(2) the cost of preparing each Developer Lot for
improvement, including demolition expenses, if
any, and in the case of each Restored New Home,
moving costs from the School District Lands to
the Developer Lot (s), grading, and all off-site
costs incurred in connection with the improvement
of each Developer Lot, including utility
connection charges and adjacent public right-of-
way improvements, if any;
(3) architectural, engineering, legal, accounting,
consulting and other professional service fees
paid in connection with the planning, execution
and financing of the Project;
(4 )
the cost of
points and
surety and
assessments;
insurance, lender financing charges,
fees, construction loan interest,
completion bonds, property taxes,
(5) the cost of construction of the New Homes,
(whether New SFD Structures or rehabilitation and
improvement work performed on Restored New Homes,
as applicable) including all building permits,
public school fees, and other regulatory agency
charges, landscaping, fencing, on-site
construction supervision and management and
construction site security patrol expenses;
(6) the cost of other extraordinary proj ect-related
construction and/or marketing expenses of the
Developer approved by the Executive Director in
his reasonable discretion which are based upon
unusual or unforeseen conditions associated with
the completion of the Project;
(7 )
New Home sales, marketing
at the time of sale of
percent (6%) of the gross
Home;
and commissions payable
each New Home of six
sales price of each New
(8) New Home sale escrow closing costs;
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(9)
a Developer overhead fee of
the cost items under (2),
above; and
five percent (5%) of
(3), (5) and (6),
(10) a Developer retained earnings allowance for its
affordable housing development operations of
eight percent (8%) of the gross sales price of
each New Home.
Al though the estimated proj ect development costs shown on
the pro forma on file with the Agency as of the Effective
Date (See: Section 2.03) indicate that such cost items (1)
through (10), above, of Final Project Costs (based upon the
assumptions of the estimated average sales price of each
Completed New Home) are anticipated to be $172,500, upon
the completion of the proj ect with sixteen (16) New SFD
Structures as New Homes, the amount of Final Project Costs
may be different from such estimate, and if Final Project
Costs are less than the product of $156,952 multiplied by
the number of New Homes as completed, then the amount of
the Affordable Housing Development Grant shall be subj ect
to an adjustment payable by the Developer to the Agency as
provided in Section 2.07.
Hazardous Substances. The words "Hazardous Substances"
mean and include without limitation:
those substances included wi thin the definiteness of
"hazardous substance," "hazardous waste," "hazardous
material," "toxic substance," "solid waste," or
"pollutant or contaminate" in CERCLA, RCRA, TSCA,
HMTA, or under any other environmental law; and
those substances listed in
Department of Transportation
172.101], or by the EPA, or any
hazardous substances [40 CFR Part
the United States
(DOT) Table [49 CFR
successor agency, as
302]; and
other substances, materials, and wastes that are or
become regulated or classified as hazardous or toxic
under federal, state, or local laws or regulations;
and
any material, waste, or substance that is:
(1) a petroleum or refined petroleum product,
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(2) asbestos,
(3) polychlorinated biphenyl,
(4) designated as a hazardous substance pursuant
to 33 USC Section 1321 or listed pursuant to
33 USC Section 1317,
(5) a flammable explosive, or
(6) a radioactive material.
Moderate-Income Household. The words "Moderate-Income
Household" mean persons and families whose income does not
exceed one hundred and twenty percent (120%) of the area
median income of the City adjusted for family size by the
State Department of Housing and Community Development in
accordance with adjustment factors adopted and amended from
time to time by the united States Department of Housing and
Urban Development pursuant to Section 8 of the United
States Housing Act of 1937, as amended, and Health and
Safety Code Section 50093, as this section may hereafter be
amended from time-to-time by the State of California.
New Home. The words "New Home" mean and refer to each of
the completed single-family residential dwelling units
(including the land and landscape improvements thereon) as
shall be constructed and installed by the Developer on each
Developer Lot. Depending on a number of factors set forth
in this Agreement, a New Home may on the Delivery Date be
either a New SFD Structure or a New Restored Home.
New Home Escrow. The words "New Home Escrow" mean and
refer to the real estate conveyance transaction or escrow
by and between the Developer and the Qualified Homebuyer
(or later, by and between the Qualified Homebuyer and the
Successor-In-Interest) for the conveyance and sale of the
New Home. The transfer of each New Home from the Developer
to a Qualified Homebuyer (or later, by and between the
Qualified Homebuyer and the Successor-In-Interest) shall
be accomplished upon the close of the New Home Escrow.
New SFD structure.
refers to the new
which the Developer
at least two (2) of
The words "New
single family
shall design,
the Developer
SFD Structure" means and
dwelling unit structure
finance and construct on
Lots. In the event that
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less than fourteen (14) of the School District Houses are
made available to the Developer for relocation onto the
remaining Developer Lots within the timeframe set forth in
this Agreement, the Developer shall design, finance and
construct New SFD Structure on each of the remaining
Developer Lots on which a School District House has not
been relocated.
Notice of Aqency Concurrence. The words "Notice of Agency
Concurrence" mean and refer to the acknowledgment executed
by the Executive Director of the Agency and delivered to
the holder of the New Home Escrow, in which the Agency
confirms that the proposed Qualified Homebuyer, appears to
satisfy all of the Adjusted Family Income and other
requirements of the Section 33334.3 Covenant for occupancy
of the New Home.
Project. The word "Project" means and refers to the
redevelopment by the Developer of sixteen (16) New Homes on
the Developer Lots. At least two (2) of the New Homes
shall be New SFD Structures and the remaining fourteen (14)
New Homes may be either Restored New Homes (to the extent
School District Houses are made available to the Developer)
or New SFD Structures all as more particularly described in
the Scope of Development attached as Exhibit "C". Each New
Home shall be reserved for sale and occupancy by a
Qualified Homebuyer. The Project shall be undertaken by
the Developer in accordance with the dates set forth in the
Schedule of Performance attached as Exhibit "0".
Qualified Homebuyer. The words "Qualified Homebuyer" mean
the purchasers of each of the sixteen (16) New Homes from
the Developer (e. g. : all persons identified as having a
property ownership interest vested in the New Home as of
the close of the New Home Escrow) which the Developer shall
reserve for sale and occupancy by Qualified Homebuyers. At
the close of the New Home Escrow involving a Qualified
Homebuyer, the Qualified Homebuyer shall: (i) have an
annual Adjusted Family Income which does not exceed the
household income qualification limits of a Moderate-Income
Household; and (ii) pay no more than an Affordable Housing
Cost for the New Home pursuant to the terms of the purchase
transaction for the New Home, including all sums payable
by the Qualified Homebuyer for its purchase money mortgage
financing, insurance, escrow and other fees and costs.
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Qualified Residence Period. The words "Qualified Residence
period" mean in the case of each New Home sold to a
Qualified Homebuyer, and the Completed New Agency Home, as
applicable, the period of time beginning on the Delivery
Date and ending on the date which is forty-five (45) years
after the Delivery Date.
Restored New Home. The words "Restored New Home" means and
refers to a School District House which has been relocated
from the School District Lands to a Developer Lot by the
Developer and which the Developer has caused to be affixed
to a new foundation and rehabilitated and constructed as a
New Home ready for occupancy by a Qualified Homebuyer. A
description of the general plan of the Developer for the
relocation of each School District House and the
restoration and improvement of each such School District
House on a Developer Lot is attached as Exhibit "G".
School District. The words "School District" mean and
refer to the San Bernardino Unified School District.
School District Houses. The words "School District Houses"
mean and refer to each of the dwelling units identified in
Exhibit "F". One or more of the School District Houses may
be made available to the Developer subject to the terms of
this Agreement, for relocation and reuse as affordable
single family dwelling units by ordinance, resolution or
motion of the board of trustees of the School District, in
the sole and absolute discretion of such board of trustees.
School District House Due Diliqence. The words "School
District House Due Diligence" means and refers to such
investigations by the Developer of each School District
House as the Developer may deem appropriate to determine
whether the Developer may accept the transfer of title in
one or more such School District Houses for transfer and
relocation from the School District Lands to the Developer
Lot(s) and for rehabilitation and improvement by the
Developer as a Restored New Home on each such Developer
Lot.
School District Lands.
mean and refer to the
House is situated.
The words "School District Lands"
si te on which each School District
Section 33334.3 Covenant. The words "Section 33334.3
Covenant" mean the Redevelopment Agency of the City of San
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Bernardino
Covenants
Homebuyer,
New Horne.
Community Redevelopment Housing Affordability
and Restrictions by and among the Qualified
the Developer and the Agency pertaining to the
Section 1.02. Parties to the Agreement.
(a) The Agency. The Agency is a public body,
corporate and politic, exercising governmental functions and
powers and organized and existing under Chapter 2 of the
Community Redevelopment Law of the State of California (Health
and Safety Code Section 33020, et seq.) The principal office of
the Agency is located at 201 North "E" Street, Suite 301, San
Bernardino, California 92401.
(b) The Developer. The Developer, Creative Housing
Solutions, a California non-profit public benefit corporation.
The principal office and mailing address of the Developer for
purposes of this Agreement is: Creative Housing Solutions, Inc.,
3233 Grand Avenue, Suite N76, Chino Hills, California 91709.
(c) Neither the City of San Bernardino or the School
District are parties to this Agreement.
Section 1.03. Prohibition Against Change in
Ownership, Management and Control of Developer and Assignment of
Agreement. The qualifications and identity of the Developer are
of particular concern to the Agency. It is because of those
qualifications and identity that the Agency has entered into
this Agreement with the Developer. No voluntary or involuntary
successor in interest of the Developer shall acquire any rights
or powers under this Agreement except as expressly set forth
herein.
Except as set forth in Section 3.03, prior to the
completion of the Project the Developer shall not assign all or
any part of this Agreement, or any rights hereunder, without the
prior written approval of the Agency Executive Director, which
approval shall not be unreasonably conditioned, withheld or
delayed. For the purpose of this Agreement, the words
"completion of the Project" mean and refer to the date by which
the Developer has caused at least sixteen (16) New Homes to be
sold to Qualified Homebuyers; provided however, that the
sixteenth (16th) New Horne Escrow shall be closed by a date not
later than as indicated in the Schedule of Performance.
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The Developer shall promptly notify the Agency in
writing of any material change in the identity of the managing
members of its non-profit corporation. This Agreement may be
terminated by the Agency prior to the completion of the Project
if there is any material change, whether voluntary or
involuntary, in membership, ownership, management or control of
the Developer (other than such changes occasioned by the death
or incapacity of any individual member or officer) that has not
been approved by the Agency prior to the time of such change or
the Agency may seek other appropriate relief in the event that
at any time following the initial disbursement of the Affordable
Housing Development Grant prior to the completion of the Project
such a material change occurs in the ownership, or control of
the Developer, the Developer's interest under the Agreement or
the Developer's ownership interest in the Developer Lots or any
portion thereof; provided, however, that (A) the Agency shall
first notify the Developer in writing of its intention to
terminate this Agreement or assert any other such remedy, and
(B) the Developer shall have thirty (30) calendar days following
its receipt of such written notice to commence and thereafter
diligently and continuously proceed with the cure of the default
of the Developer hereunder and submit evidence of the initiation
of satisfactory completion of such cure to the Agency in a form
and substance deemed satisfactory to the Agency, in its
reasonable discretion.
Section 1.04. Benefit to Project Area.
(a) The Agency has determined that the redevelopment
of the Developer Lots by the Developer in accordance with this
Agreement will eliminate blight and provide needed affordable
housing to the Central City North Redevelopment Project Area as
well as to areas in proximity thereto, which housing is needed
due to the insufficiency of new affordable housing within the
City generally.
(b) Provided the Developer is not then in default,
the Developer may request the Agency to approve the substitution
of up to six (6) of the Developer Lots as identified on Exhibit
"AN as of the Effective Date for other lots to be acquired by
the Developer at any time prior to the commencement of work of
improvement by the Developer on any such Developer Lot by giving
thirst (30) days written notice of such substitution to the
Executive Director which references this Section 1.04 (b) . Each
substitute Developer Lot shall be located in the Redevelopment
Project Area of the Central City North Redevelopment Project and
each such substitute Development Lot shall be unoccupied at the
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time of such substitution request. Any existing structure on
such a substitute Developer Lot shall be demolished by the
Developer within sixty (60) days following the Developer's
acquisi tion of such substitute Developer Lot. The substitution
by the Developer of one or more Developer Lots shall not
otherwise affect the schedule of performance for the completion
of any of the New Homes or the Project.
Section 1.05. List of Exhibits to Agreement.
following is a listing of the Exhibits attached to
Agreement. Each such exhibit is incorporated by this by
reference into the text of this Agreement:
The
this
this
EXHIBIT "A"
EXHIBIT "B"
EXHIBIT "e"
EXHIBIT "0"
EXHIBIT "E"
EXHIBIT " F"
EXHIBIT "G"
Legal Description of Developer Lots
Form of Notice of Agreement
Project Description/Scope of Development
Schedule of Performance
Form of Section 33334.3 Covenant
School District Houses
Form of Property Owner Consent to Formation
of Landscape Assessment District
ARTICLE II
DISBURSEMENT OF AFFORDABLE HOUSING DEVELOPMENT GRANT
Section 2.01. Affordable Housing Development Grant.
(a) Subject to the terms and conditions set forth in
this Agreement, the Agency hereby allocates and reserves the sum
of Two Hundred Thousand Dollars ($200,000) to the Developer for
disbursement, in installments (the Affordable Housing
Development Grant) as provided in this Section 2.01 in support
of the Project.
(b) The Agency shall disburse the Affordable Housing
Development Grant to the Developer in installments as follows:
(i) upon the Developer's acquisition of fee title
interest in each Developer Lot, the Agency shall
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disburse the sum of Eight Thousand
($8,000) as partial payment for the
price as provided in Section 2.01(c);
however, that the aggregate amount of
disbursements shall not exceed $128,000;
Dollars
purchase
provided
all such
(ii) provided that the Developer has acquired the fee
title interest in the sixteen (16) Developer Lots
and is not otherwise in default, the Agency shall
disburse the sum of $72,000 to the Developer
under either subparagraph (A) or (8) below:
(A) provided the School District has taken
official action within six (6) months
following the Effective Date to make the
School District Houses available to the
Developer and the Developer has elected to
accept the School District Houses for
relocation to the Developer Lots for
rehabilitation and improvement as Restored
New Homes, the Agency shall disburse the sum
of $72,000 to the Developer upon completion
of the relocation of the School District
Houses to the Developer Lots and the
attachment of each such School District
House to a new foundation on each such
Developer Lot; or
(8) in the event that the School District Houses
are not made available to the Developer
within six (6) months following the
Effective Date or in the event that the
Developer elects not to accept the School
District Houses for any reason, the Agency
shall disburse the sum of up to $72,000 to
the Developer as follows:
(1) a sum not to exceed $36,000 for
reimbursement of third party
professional civil engineering,
architecture and structural engineering
fees and expenses incurred and paid by
the Developer in connection with the
design and construction of the New
Homes; and/or
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(2) for building permit fees, public school
capital facility fees, City water and
sewer connection fees and capacity
charges and other regulatory fees or
charges assessed or payable by the
Developer to public agencies with
regulatory jurisdiction over the
improvement and construction of the New
Homes.
The total amount of the Affordable Housing Development
Grant payable under (A) or (B), above, of this Section
2.01(b) (ii) shall not exceed the sum of $72,000. Affordable
Housing Development Grant disbursements under Section
2.01 (b) (ii) (A) shall be subject to the provisions of Section
2.01(d) and disbursements under Section 2.01(b) (ii) (B) shall be
subject to the provisions of Section 2.01(e).
(c) Within fifteen (15) days following the Effective
Date, the Agency shall disburse the sum of Thirty Two Thousand
Dollars ($32,000) to reimburse the Developer for a portion of
the purchase price previously paid by the Developer for four (4)
of the Developer Lots. Concurrently with the disbursement of
the sum of $32,000, the Developer shall execute in recordable
form and cause to be recorded the Notice of Agreement
substantially in the form attached as Exhibit "B" against each
of the four (4) Developer Lots. Provided the Developer is not
then in default, each subsequent disbursement of the Affordable
Housing Development Grant under Section 2.01 (b) (i) (for a total
remaining balance of $96,000) shall be payable by the Agency for
the account of the Developer through the escrow holder
identified by the Developer for the Developer's purchase of each
of the remaining twelve (12) Developer Lot wi thin thirty (30)
days following receipt by the Agency of notice from the
Developer setting forth the total amount payable by the
Developer for the acquisition of each particular Developer Lot
and a statement of the Developer that such escrow is reasonably
expected to be in a condition to close upon the escrow holder's
receipt of the installment of the Affordable Housing Development
Grant from the Agency in immediate funds, plus the remaining
balance of such Developer Lot purchase price (and all related
escrow closing costs) from the Developer. The Agency shall not
be deemed a party to any such escrow. The Developer shall
deliver its portion of the purchase price for each particular
Developer Lot and the escrow shall close and the Developer shall
acquire the merchantable fee title interest in each such
Developer Lot within five (5) days following the deposit of the
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Agency's funds into such escrow for the account of the
Developer. The escrow holder shall also cause to be recorded
concurrently with the close of each escrow for the Developer's
purchase of each Developer Lot, a Notice of Agreement executed
by the Developer and the Agency substantially in the form
attached as Exhibit "B". The Developer and the Agency shall
also execute written escrow instructions in favor of such escrow
holder as may be reasonably requested by such escrow holder or
either of the parties to this Agreement. In the event that any
such escrow may fail to close for any reason wi thin five (5)
days following the escrow holder's receipt of the Agency's
funds, then in such event, the escrow holder shall return the
$8,000 in Agency funds to the Agency without further instruction
from the Developer or any third party. The Agency may at its
sole cost, obtain a policy of title insurance (or an endorsement
of a policy of title insurance obtained by the Developer) which
insures that the Notice of Agreement in proper form has been
recorded at close of each such escrow and that such Notice of
Agreement is subject to only those title exceptions as
previously approved in writing by the Executive Director of the
Agency. The Developer hereby agrees to cooperate with the
Agency in causing the escrow holder for each such Developer Lot
acquisition escrow to deliver a policy of title insurance in
favor of the Agency, if requested by the Agency. The Developer
shall exercise all reasonable effort to cause each such escrow
for the acquisition of the sixteen (16) Developer Lots to be in
a condition to close wi thin ninety (90) days of the Effective
Date.
(d) Provided the board of trustees of the School
District has, in its sole and absolute discretion taken official
action within six (6) months following the Effective Date to
declare the School District Houses available for relocation and
restoration, and further provided that the Developer has
delivered to the Agency its written acceptance of the transfer
of School District Houses by the School District to the
Developer in accordance with Section 2.04, and further provided
that the Developer is not then in default hereunder, the Agency
shall disburse the sum of $72,000 to the Developer within thirty
(30) days of receipt by the Agency of satisfactory written
evidence from the Developer that each of the School District
Houses as accepted by the Developer have been: (i) removed from
the School District Lands to the written satisfaction of the
School District; and (ii) each such School District House has
been attached to a new foundation on a Developer Lot. Before
any such draw request under this Section 2.01(d) shall be
disbursed to the Developer, the Developer shall provide
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satisfactory written evidence to the Executive Director that a
reputable construction lender has given the Developer a written
construction loan commitment for financing the improvement of at
least eight (8) Restored New Homes and two (2) New SFD
Structures subject only to customary and commercially reasonable
terms.
(e) In the event that the School District may not
elect to make the School District Houses available for
relocation and restoration, or in the event that the Developer
may elect not to accept the transfer of the School District
Houses in accordance with Section 2.04, and further provided
that the Developer is not then in default hereunder, the Agency
shall disburse the sum of $72,000 to the Developer in one or
more draws (with no such draw request of the Developer in an
amount less than $5,000) for the purposes set forth in Section
2.0l(b) (ii) (B). Before any such draw request under this Section
2.0l(e) shall be disbursed to the Developer, the Developer shall
provide satisfactory written evidence to the Executive Director
that a reputable construction lender has given the Developer a
written construction loan commitment for financing the
improvement of at least six (6) New SFD Structures, subject only
to customary and commercially reasonable terms. The Developer
shall submit written draw requests to the Agency accompanied by
a suitably detailed description of the New Home construction-
related expenses incurred by the Developer for which the draw
request corresponds. The Agency shall pay each such draw within
thirty (30) days following receipt of a complete draw request
from the Developer.
(f) Upon the written request of the Agency at any
time prior to close of a New Home Escrow, the Developer shall
execute in recordable form and cause to be recorded against each
Developer Lot, the final form of the Property Owner Consent to
Formation of Landscape Assessment District substantially in the
form attached hereto as Exhibit "G".
Section 2.02. Developer Agreement to Undertake the
Project.
(a) Subject to the satisfaction of the applicable
conditions precedent set forth in Section 2.13, the Developer
hereby agrees to undertake the proj ect. The proj ect shall be
undertaken in accordance with the schedule of improvement set
forth in the Schedule of Performance.
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(b) The Developer and the Agency each acknowledge and
agree that as of the Effective Date, the board of trustees of
the School District has made no decision regarding the
disposition of the School District Houses and that the Developer
may never acquire any such School District Houses for relocation
and restoration either from the School District or the Agency as
part of the proj ect. In the event that the School District
Houses are both: (i) made available to the Developer, and (ii)
are accepted by the Developer for relocation and restoration
within six (6) months following the Effective Date, the
Developer acknowledges and agrees that it shall undertake the
construction and improvement of the New Homes on the Developer
Lots as follows:
Two (2) New SFD Structures shall be constructed and
installed on Developer Lots designated by the
Developer and shall be ready for occupancy within
eighteen (18) months following the Effective Date; and
the remaining fourteen (14) Developer Lots shall
either be improved with Restored New Homes attached to
new foundations thereon or New SFD Structures, all
such New Homes shall be ready for occupancy within
eighteen (18) months following the Effective Date.
In the event that the School District Houses are
ei ther: (i) not made available to the Developer, or (ii) not
accepted by the Developer for relocated and restoration within
six (6) months following the Effective Date of this Agreement,
the Developer acknowledges and agrees that it shall undertake
the construction and improvement of the New Homes on the
Developer Lots as follows:
Six (6) New SFD Structures shall be constructed and
installed on Developer Lots designated by the
Developer and shall be ready for occupancy within
eighteen (18) months following the Effective Date, and
thereafter ten (10) additional New SFD Structures
shall be constructed and installed on Developer Lots
designated by the Developer, and shall be ready for
occupancy within thirty (30) months following the
Effective Date.
(c) By a date not later than the completion of the
Project or September 1, 2005, whichever date may first occur,
the Developer shall deliver to the Agency a suitably detailed
wri tten accounting of the Final proj ect Costs prepared by the
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Developer's certified public accountant in accordance with
generally accepted accounting principles.
section 2.03. Project Development Cost Pro Forma.
(a) The Developer has prepared and submitted to the
Agency and the Agency has accepted as of the Effective Date a
Project development cost pro forma which is based upon a set of
cost assumptions that the final Project will consist of sixteen
(16) New SFD Structures being constructed and installed on the
Developer Lots (the "Initial Project Pro Forma"). Based upon
such Project development cost pro forma, the Agency has made the
Affordable Housing Development Grant available to the Developer.
(b) The Developer may modify the Initial Project Pro
Forma as follows:
(i) during the School District House Due Diligence
period for the School District Houses as set
forth in Section 2.04, the Developer may submit
one or more modifications to the Initial Project
Cost Pro Forma which reflect development costs of
the Project based upon the Developer's
inspections of the School District Houses which
may hereafter be made available to the Developer,
the plans and specifications prepared by the
Developer for the relocation of such structures
to the Developer Lots and the cost estimates
prepared by the Developer for the completion of
the rehabilitation work on such structures as
Restored New Homes;
(ii) the Developer shall submit any proposed
modification of the Initial Project Pro Forma to
the Agency wi thin sixty (60) days following the
date when the School District may make the School
District Houses available to the Developer for
inspection together with a written request that
the Agency approve such modification(s) as the
"Modified Project Pro Forma";
(iii) provided the Developer has submitted a request
for Modified Project Pro Forma, the Executive
Director of the Agency shall accept such
modification if: (A) the proposed modification
indicates that the cost payable by the Developer
for the completion of the relocation and
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rehabilitation of the final number of School
District Houses made available to the Developer
as Restored New Homes does not exceed by more
than ten percent (10%) the Developer's estimates
of the cost of the Project under the Initial
Project Pro Forma and (B) the Developer provides
satisfactory written evidence to the Executive
Director that a reputable construction lender has
given the Developer a written construction loan
commitment for financing the improvement of the
Project subject only to customary and
commercially reasonable terms. The Executive
Director of the Agency shall not unreasonably
withhold, condition or delay his approval of
Modified Project Cost Pro Forma if the conditions
of this subparagraph (iii) have been satisfied by
the Developer;
(iv) in the event that the proposed Modified Project
Cost Pro Forma may indicate that the total cost
of the proj ect is estimated to be greater than
the cost estimate set forth in the Initial
Project Pro Forma, the Agency shall have no duty
or obligation to increase the amount of the
Affordable Housing Development Grant;
(v) the Executive Director shall approve or reject
the proposed Modified Project Cost Pro Forma
within fifteen (15) days of the submitted by the
Developer of the information under subparagraph
(iii), above, and if so accepted, the Modified
Project Pro Forma shall be deemed the Project
Development Cost Pro Forma for the purpose of
determining whether: (A) any portion of the
Affordable Housing Development Grant may be
refunded to the Agency under Section 2.05; and
(B) whether any Agency Participation Fee may be
payable to the Agency under Section 2.06.
Section 2.04. School District House Due Diligence
Period .
(a) The Developer may conduct such due diligence
investigation of the structural and environmental condition of
the School District Houses as the Developer deems appropriate
and as the School District may permit. The Developer shall be
solely responsible for obtaining any necessary consents from the
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School District to conduct such investigations with respect to
the School District Houses. All such investigations shall be
conducted at the sole cost and expense of the Developer.
(b) The Developer's due diligence investigation of
the School District Houses shall be completed by the first of
the following dates to occur: (i) six (6) months following the
Effective Date; or (ii) within sixty (60) days following the
date when the School District makes the School District Houses
available to the Developer for such inspection.
(c) During the School District House Due Diligence
period the Developer shall conduct such consultations with
interested persons as the City Planning Department and the
School District may require relating to the proposed relocation
and rehabilitation work for the School District Houses as
Restored New Homes.
(d) The Agency shall have no duty or obligation under
this Agreement to be a party to any inspection agreement or
license for entry relating to any School District House pursuant
to which the School District may authorize the Developer to
conduct any investigation of the condition of any School
District House. Notwithstanding the foregoing sentence, the
Developer may request the Agency to enter into an inspection or
license agreement relating to any School District House as the
School District may reasonably request; provided however that
the approval of any such inspection or license agreement
relating to the School District Houses shall be subj ect to the
prior approval of the governing board of the Agency in its sole
and absolute discretion. The Developer shall indemnify and hold
the Agency harmless from any cost or expense arising from the
Developer's inspection of any School District House under any
such inspection or license agreement, and the Developer shall
comply with all of the other terms which the Agency may require
as a condition of its approval of any such inspection or license
agreement.
(e) Based upon such investigation as the
may undertake wi thin the School District House Due
Period, the Developer may either accept or reject the
of one or more of the School District Houses, in the
absolute discretion of the Developer.
Developer
Diligence
condition
sole and
Section 2.05. Acceptance
District Houses and Relocation and
New Homes.
by Developer of
Rehabili tat ion of
School
Restored
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(a) Provided the School District in its sole
discretion take official action to make the School District
House available to the Developer and further provided that the
Developer in its sole discretion has also delivered its written
acceptance of the School District Houses to the Agency by no
later than the date provided in Section 2.04 (b), together with
any indicated modification of the Initial Project Pro Forma as
set forth in Section 2.03(b), the Developer shall promptly
complete the relocation of the School District Houses to the
Developer Lots.
(b) The relocation of the School District Houses to
the Developer Lots shall be subject to such terms and conditions
as the School District may require, to such other terms and
conditions as the City of San Bernardino may impose under the
applicable development regulations of the City, and to the
extent applicable, the terms and conditions of Section 2.09.
(c) The Agency shall not be a party to any contract
or agreement by and between the Developer and the School
District relating to the relocation of the School District
Houses or to the transfer of title in any such School District
House to the Developer except on such terms and conditions as
the governing board of the Agency may hereafter approve in its
sole discretion.
(d) In the event that any of the
may not be satisfied, the Developer shall
complete the proj ect as described in the
Section 2.02(b):
following conditions
promptly proceed to
second paragraph of
(i) the School District Houses are not made available
to the Developer or are not made available to the
Developer on terms acceptable to the Developer
within six (6) months following the Effective
Date; or
(ii) the Developer may elect not to accept the
condition of the School District House within six
(6) months following the Effective Date; or
(iii)
if applicable, the
modification to the
set forth in Section
Agency does not approve a
Ini tial proj ect Pro Forma as
2.03(b); or
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(iv) if applicable, the Agency may not approve the
terms of any proposed agreement by and between
the School District and the Developer relating to
the School District Houses in which the Agency is
proposed to be a party.
Section 2.06. Sale
Qualified Homebuyers.
of
Completed
New
Homes
to
(a) Each New Home which the Developer proposes to
sell to a Qualified Homebuyer shall be transferred to such
Qualified Homebuyer through a New Home Escrow. The Agency shall
not be a party to any such New Home Escrow. The Developer shall
instruct the holder of the New Home Escrow, that the escrow
holder shall comply with the provisions of Section 2.06 (d) of
this Agreement and at the close of each New Home Escrow, the
escrow holder shall provide the Agency with a copy of both the
"seller's" and the "buyer's" closing statement, together with a
complete copy of the real estate sales agreement between the
Developer and the Qualified Homebuyer for the New Home.
(b) The Developer shall deliver to the Agency the
information relating to the Qualified Homebuyer described in
Section 2 (e) of the Section 33334.3 Covenant, within five (5)
days following the Developer's designation of such Qualified
Homebuyer as the prospective purchaser of the New Home.
Concurrently upon the Developer's delivery to the Agency of the
household income and occupancy information described in Section
2 (e) of the Section 33334.3 Covenant, the Developer shall also
request that the Agency issue its Notice of Agency Concurrence
with respect to the Qualified Homebuyer designated by the
Developer. Within ten (10) days following its receipt of such
written information and request from the Developer relating to
the Qualified Homebuyer, the Agency shall provide the Developer
with a preliminary confirmation of the approval or rejection of
the income and household occupancy qualifications of the
proposed Qualified Homebuyer. In the event that the Agency may
request additional information relating to the confirmation of
the matters described in the preceding sentence with respect to
the Qualified Homebuyer, the Developer shall cause such
additional information to be provided to the Agency as promptly
as feasible. The Executive Director of the Agency shall issue a
preliminary determination of his concurrence of the eligibility
of the Qualified Homebuyer within ten (10) days following
receipt of such completed income and household occupancy
information. Provided that the proposed Qualified Homebuyer
also qualifies to obtain purchase money mortgage financing for
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the purchase of the New Home with terms and costs not in excess
of an Affordable Housing Cost for such Qualified Homebuyer, as
evidenced by a written mortgage lending contract by and between
the Qualified Homebuyer and a financial lending institution,
which is issued wi thin sixty (60) days following the Executive
Director's preliminary concurrence of the eligibility of the
Qualified Homebuyer designated by the Developer, the Executive
Director of the Agency shall issue a Notice of Agency
Concurrence to the Escrow Holder. In the event that the Agency
may later determine that the written information provided to it
in support of a request for issuance of a Notice of Agency
Concurrence is false or incorrect in any material respect, then
in such event the Agency may exercise all of its remedies to
enforce the provisions of this Agreement and the Section 33334.3
Covenant, if applicable, notwithstanding the fact that a Notice
of Agency Concurrence may have been issued in favor of a
particular Qualified Homebuyer.
(c) The Developer and the Agency mutually covenant
and agree to execute all necessary or appropriate written escrow
instructions as may be reasonably requested by the escrow holder
in connection with the New Home Escrow.
(d) Each New Home Escrow shall close upon
satisfaction of the applicable escrow conditions by and between
the Developer and such Qualified Homebuyer and when the escrow
holder confirms that:
(i) it is in receipt of the Notice of Agency
Concurrence for the Qualified Homebuyeri
(ii)
the escrow holder shall
recorded a fully executed
33334.3 Covenant for the New
have recei ved and
form of the Section
Homei and
(iii) the escrow holder shall provide the Agency with
evidence in the form of a policy of title
insurance in favor of the Agency which insures
that the Section 33334.3 Covenant is subject only
to the lien for property taxes and the lien in
the New Home of the senior purchase money
mortgage lender to the Qualified Homebuyer.
(e) In the event that the New Home Escrow may fail to
close for any reason, the Developer shall cause such New Home
Escrow to be cancelled. The Developer shall pay for all of the
costs and expenses of such New Home Escrow and shall indemnify,
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defend and hold the Agency harmless from any such costs which
may otherwise have been assessed or charged to the Agency.
Section 2.07. Final Project Cost Verification.
(a) Within sixty (60) days following the completion
of the Project, and in any event by a date not later than
September 1, 2005, whichever date first occurs, the Developer
shall submit to the Agency its written certification of Final
proj ect Costs as provided in Section 2.02 (c) . I f applicable,
the Final Project Cost verification shall be based upon the
Modified Project Pro Forma.
(b) In the event that as of the date of the
Developer's certification relating to Final Project Cost under
Section 2.07 (a), such certification and/or the audit or
examination by the Agency of the books and records of the
Developer relating to the Project, may indicate that a refund of
the Affordable Housing Development Grant is payable to the
Agency, such refund shall consist of the addition of two (2)
separate variables as follows:
Refund Variable A = the number (if any) of New Homes
less than 16 as actually produced
and occupied or ready for
occupancy (less any release
payment previously made by the
Developer to the Agency under
Section 4.01(d), exclusive of
interest) as of the date of the
Developer's certificate under
Section 2.07 (a) multiplied by the
sum of $12,500; and
Refund Variable B 8% of the difference, if any,
between: (i) the product of
$156,952 multiplied by the number
of New Homes produced and occupied
or ready for occupancy and (ii)
Final Project Costs divided by the
actual number of New Homes
produced and occupied or ready for
occupancy as of the date of the
Developer's certificate under
Section 2.07(a);
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(c) The Developer shall maintain accounting books and
records of Project development costs and Final Project Costs, in
accordance with generally accepted principles of business
accounting. The Agency and its accountants and auditors shall
have the right to conduct, at its expense, an inspection and
review of the accounting books and records of the Developer
relating to the proj ect upon the request of the Agency. The
Developer shall cooperate with the Agency in the production of
its accounting books and records as reasonably required by the
Agency and its auditors to conduct an audit of actual Project
development costs.
(d) In the event that the Agency reasonably
determines based upon its review of the Developer's certificate
of Final Project Costs under Section 2.07 (a) or based upon its
audi t of the proj ect related business record of the Developer
under Section 2.07(c), or both, that any portion of the
Affordable Housing Development Grant is refundable by the
Developer to the Agency, then the Developer shall remit the such
portion of the Affordable Housing Development Grant to the
Agency within thirty (30) days of written demand therefore by
the Agency.
Section 2.08. Agency Participation Fee in Retained
Earnings of Developer in the Prolect.
(a) In addition to and separate from any
reimbursement of the Affordable Housing Development Grant
payable to the Agency under Section 2.07, the Developer shall
also pay to the Agency a proj ect development participation fee
as set forth in this Section 2.08 (the "Agency Participation
Fee") .
(b) The Agency Participation Fee is a sum payable by
the Developer to the Agency from a special source of Developer
funds described in this Section 2.08, to the extent that such
funds are available therefor, as consideration for the agreement
by the Agency to contribute the Affordable Housing Development
Grant to the Developer. The Agency Participation Fee is a sum
equal to one-half (1/2) of the "Retained Earnings of the
Developer", as defined below. The "Retained Earnings of the
Developer" is a sum of money which the Developer has realized as
profi t or retained earnings from the proj ect after deducting
Final Project Costs.
(c) From and after the time that the sixth (6th) New
Home Escrow shall be closed until the Agency Participation Fee
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is paid in full to the Agency, the Developer shall provide the
Agency with the following financial reports relating to the
Project:
(i) within sixty (60) days of the end of each
calendar quarter and upon the request of the
Agency, a report on the status of the
Project, which shall include, at a minimum,
the trial balance, general ledger, cash
receipt journal, cash disbursements journal,
sales journal, job cost summary compared
with the Project pro-forma, bank statement,
and quarterly profit and loss statement, and
schedule of cash flows and a weekly sales
report for New Homes, as applicable; and
(ii) within one hundred twenty (120) days after
the end of each fiscal year, an annual
unaudited financial statement, prepared by
the Developer for the Project or, if
obtained by the Developer, an audited
financial statement.
(d) At the time indicated in Section 2.07(a) the
Developer shall provide the Agency with a suitably detailed
written accounting prepared in accordance with generally-
accepted accounting principals of the amount of the Agency
Participation Fee which the Developer shall certify is due and
payable to the Agency. The Agency shall have the right to
inspect the business and financial records of the Developer as
related to these calculations and verification of the amount of
the Agency Participation Fee as may be payable to the Agency, if
any. The Developer shall provide the Agency (and its auditors
or accountants) with reasonable access to such business records
upon reasonable prior notice from the Agency. In the event that
the Agency reasonably determines that any Agency Participation
Fee is payable from the Retained Earnings of the Developer based
upon its review of the Developer's certificate under Section
2.07(a) or based upon its audit of Project related business
records of the Developer under Section 2.07 or this Section 2.08
the Developer shall remit such sum of the Agency Participation
Fee within thirty (30) days of written demand thereof by the
Agency.
Section 2.09. Agency as a Party to a School District
Agreement or License Relating to any School District House.
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(a) Nothing in this Agreement shall be deemed to be a
commi tment or undertaking by the Agency to be a party to any
agreement or license arrangement by and between or among the
School District and the Developer relating to the inspection or
the acceptance of title by the Agency in any such School
District House as personal property, or the disposition of any
School District House to the Developer. The Agency hereby
reserves the sole and absolute discretion to enter into one or
more inspection or license agreements relating to a School
District House as the Developer or the School District may
request in order to accommodate the removal of any such School
District House from School District Lands either by the
Developer or by third persons, or to accommodate the transfer of
title and possession of any School District House, as personal
property, from the School District to the Developer. Any
agreement relating to the inspection or disposition of the
School District Houses to the Developer to which the Agency may
hereafter be a party shall contain such terms and conditions as
may be required by the Agency and shall be subject to the prior
approval by the governing board of the Agency.
(b) In the event that the School District or the
Developer, or either of them, may not accept any term or
condition required by the Agency as a condition to be a party to
an agreement relating to the inspection or disposition of any
School District House, the Developer shall either cause the
School District to permit the inspection and/or disposition of
each School District House to the Developer to occur under a
contract or agreement to which the Agency is not a party, or the
Developer shall undertake the development and improvement of
each of the Developer Lots with a New SFD Structures as provided
in this Agreement.
License
Houses.
Section 2.10. Minimum
Agreement Relating to
Conditions
Disposition
for any
of School
Aqency
District
(a) In the event that the Agency may in its sole and
absolute discretion consent to be a party to any agreement or
license by and between or among the School District and the
Developer relating to the inspection or disposition of any
School District House to the Developer, such agreement or
license shall contain the following provisions relating to
Hazardous Substances, asbestos containing materials ("ACMs"),
lead based paint ("LBP") and lead containing construction
materials ("LCCMs"):
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. prior to commencement of any portion of the inspection
or relocation work on the School District Lands the
Developer shall retain an environmental consultant
reasonably acceptable to the Agency (the "Consultant")
to conduct testing on the School District Houses for
ACMs, LBPs and other Hazardous Substances (the
"Baseline Assessment"). The Agency and the Developer
shall agree on the specific sites on the School
District Houses for sampling and borings and building
materials sampling for the Baseline Assessment. The
Baseline Assessment shall be completed within fifteen
(15) days of entry onto any School District Lands.
Wi thin ten (10) days following the completion of the
work of the Baseline Assessment on the School District
Lands the Consultant shall deliver a written report
addressed to the Developer and the Agency (the
"Baseline Report") regarding the results of the
Baseline Assessment that satisfies the requirements of
applicable law and is otherwise in form and substance
reasonably satisfactory to the Developer, the Agency,
and if applicable, acceptable to the School District.
The Baseline Report shall, upon its approval by the
Developer and the Agency, and if applicable by the
School District, provide the basis upon which the
Developer shall prepare a written work plan and bid
specification to obtain the services of a qualified
and licensed contractor to perform the indicated
abatement and remediation of ACMs, LBP, LCCM and other
Hazardous Substances on the School District Houses.
The Executive Director of the Agency shall review and
approve the Baseline Report within ten (10) days
following submission by the Developer of such approval
by the Executive Director shall not be unreasonably
conditioned, withheld or delayed.
The Developer shall cause to be prepared the form of
the written work plan and bid specifications to retain
the services of a qualified and licensed contractor to
perform the abatement and remediation work as
indicated in the Baseline Assessment, and such written
work plan and bid specifications shall be subject to
the review and approval of the Executive Director of
the Agency wi thin ten (10) days following submission
by the Developer, and such approval shall not be
unreasonably conditioned, withheld of delayed. All
work of abatement and remediation of LCMs, LBP, LCCM
and other Hazardous Substances shall be performed on
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the School District Lands, before such structure is
made ready for removal or relocation from its existing
foundation on the School District Lands.
All asbestos related work on the School District Lands
or elsewhere shall be conducted and completed by the
Developer in accordance with all applicable
Environmental Laws including without limitation the
following:
.
South Coast
Asbestos
Activities.
Air Quality Management District Rule 1403
Emissions from Renovation/Demolition
.
National Emissions Standards
pollutants, 40 CFR 61, M.
for
Hazardous
Air
. Occupational Safety and Health Administration,
Asbestos in the Workplace, 29 CFR 1910.1001.
. Occupational Safety and Health Administration,
Asbestos Construction Standard, 29 CFR 1926.1101.
. Title 8, California Code of Regulations Section 1529,
Cal-OSHA Construction Standard.
All lead related work on the School District Lands or
elsewhere shall be conditioned and completed by the Developer in
accordance with all applicable Environmental Laws including
without limitation the following:
. Title 17, California Code of Regulations, Division 1,
Chapter 8: Accreditation, Certification and Work
Practices for Lead-Based Paint and Lead Hazards.
. Title 8, California Code of Regulations, Section
1532.1: Cal/OSHA Construction Safety Orders, Lead.
. "Guidelines for the Evaluation and Control of Lead-
Based Paint Hazards in Housing," US Department of
Housing and Urban Development, June 1995.
. all certifications, respiratory fit tests and medical
releases must be on-site at all times when ACM, LBP
and LCCM related work is being performed.
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. all waste generated from the abatement and remediation
of any LCM, LBP, LCCM and any Hazardous Substance on
the School District Lands or on or wi thin any School
District House must be properly profiled and disposed
of at a land disposal facility which is licensed to
accept such waste for final disposal. Waste disposal
manifests documenting the disposal site shall be
executed by the Developer and shall be available for
inspection by the Agency and the School District at
all times during the course of the abatement and
remediation work. It is illegal to improperly dispose
of any Hazardous Substance, including LCMs, LBPs and
LCCMs in the State of California.
.
the Agency and/or the School District
right to order the suspension of any
and/or Hazardous Substance abatement
work as may be set forth in the form
agreement acceptable to the Agency and,
acceptable to the School District.
shall have the
LCM, LBP, LCCM
or remediation
of the license
if applicable,
. the Developer shall covenant and agree that in the
relocation of the School District Houses, it will
comply with all applicable Environmental Laws relating
to the presence of ACM or LBP on the School District
Lands or in the School District Houses. The Developer
shall also acknowledge that the Agency assumes no
liability for damages for personal injury, illness,
disability, or death to the Developer, or to any other
person, including members of the general public,
arising from or incident to the purchase,
transportation, removal, handling, use, disposition,
or other activity causing or leading to contact of any
kind whatsoever with ACM or LBP on the School District
Lands or in the School District Houses, whether the
Developer properly warned, or failed to properly warn,
the persons injured.
. each such agreement or license shall evidence a
disclaimer by the Agency of all implied warranties by
the Agency regarding the environmental condition of
the School District Lands or the School District
Houses under any Environmental Law and the regulation
of the storage, disposal, release or transport of any
Hazardous Substances, hazardous wastes, petroleum
product, ACM or LBP on the School District Lands or in
or from the School District Houses, at any time and
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that no statement of fact, promise, representation,
affirmation or other indication has been made by the
Agency to the Developer with respect to the quality or
condition of the School District Houses.
. the Developer shall acknowledge and agree that it was
given a full opportunity, to inspect and investigate
every aspect of the School District Lands and the
School District Houses. The Developer shall enter,
use or occupy the School District Lands for the
relocation of the School District Houses, in an "AS
IS," "WHERE IS" and "SUBJECT TO ALL FAULTS" condition.
The Developer shall further represent to the Agency
that the Developer conducted and completed any and all
independent investigation of the condition of the
School District Lands and the School District Houses
that the Developer believes to be indicated. The
Developer hereby acknowledges that it is relying
solely upon its own investigation of the School
District Lands and the School District Houses and its
own review of any available information and
documentation, as it deems appropriate, for the
purpose of entering, using or occupying the School
District Lands. The Developer is not relying on any
statement or representation by the Agency, any
employee, official or consultant of the Agency
relating to the condition of the School District
Houses or the School District Lands.
. the Developer shall agree, at its sole cost and
expense, to indemnify, protect, hold harmless and
defend the Agency, with counsel selected by the Agency
from and against any and all claims, demands, damages,
losses, liabilities, obligations, penalties, fines,
actions, causes of action, judgments, suits,
proceedings, costs, disbursements and expenses,
including, without limitation, fees, disbursements and
costs of attorneys, environmental consultants and
experts, and all foreseeable and unforeseeable
consequential damages of any kind or of any nature
whatsoever (collectively, "Losses") that may, at any
time, be imposed upon, incurred or suffered by, or
asserted or awarded against, the Agency directly or
indirectly relating to or arising from any of the
following "Environmental Matters":
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any presence of Hazardous substances on, in,
under or affecting all or any portion of the
School District Lands or School District Houses
or on, in, under or affecting all or any portion
of any property adjacent or proximate to the
School District Lands, if the presence of such
Hazardous Substances results from the Developer's
activities upon the Demolition Site.
any storage, holding, handling, release,
threatened release, discharge, generation, leak,
abatement, removal or transportation of any
Hazardous Substances on, in, under or from the
School District Lands or the School District
Houses by the Developer, its agents or
contractors.
any violation of law, rule, regulation, judgment,
order, permit, license, agreement, covenant,
restriction, requirement or the like by the
Developer, its agents or contractors, relating to
or governing in any way Hazardous Substances,
including, without limitation, all Environmental
Laws, occurring on or from any portion of the
School District Lands or in or from the School
District Houses.
the failure of the Developer, its agents or
contractors, to properly complete, obtain, submit
and/or file any and all notices, permits,
licenses, authorizations, covenants and the like
in connection with the Developer's acti vi ties on
the School District Lands.
the implementation and enforcement by the
Developer, its agents or contractors of any
monitoring, notification or other precautionary
measures that may, at any time, become necessary
to protect against the release, potential release
or discharge of Hazardous Substances on, in,
under, from or affecting the School District
Lands or the School District Houses or in the
air, any body of water, any other public domain
or any property adjacent or proximate to the
School District Lands.
31
CDC/2003-7
any failure of the Developer, its agents or
contractors, in compliance with all applicable
Environmental Laws, to lawfully remove, contain,
transport or dispose of any Hazardous Substances
stored or generated on the School District Lands
or the School District Houses by the Developer,
its agents or contractors.
any investigation, inquiry, order, hearing,
action or other proceeding by or before any
governmental agency in connection with any
Hazardous Substances or violation of any
Environmental Law occurring or allegedly
occurring as a result of the acti vi ties of the
Developer, its agents or contractors;
all obligations of the
environmental indemnity
demand from the Agency.
Developer
shall be
under such
payable on
(b) Any such agreement or license to which the Agency
may be requested to be a party, shall be approved in the sole
and absolute discretion of the Agency, and shall be fully
executed by the parties thereto, before the Developer performs
any work of relocation of any School District House.
Section 2.11. RESERVED - NO TEXT.
Section 2.12. RESERVED - NO TEXT.
Section 2.13. Developer I s Conditions Precedent. The
Developer's obligation to undertake and complete the Project,
shall be conditioned upon the fulfillment of the following
conditions precedent, all of which shall be satisfied (or waived
in writing pursuant to Section 2.15) prior to the date set forth
in Section 2.02(b):
(I) The Agency shall not
material term of this Agreement
Agency hereunder;
have
to be
defaulted
performed
on
by
any
the
(2) the Developer I s approval of any notice of change
in representation or warranty given by the Agency pursuant
to Section 2.16(a)hereof;
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(3) the Agency shall have deemed satisfied (or waived
satisfaction of) each of the conditions precedent set forth
in Section 2.14;
Section 2.14. The Agency's Conditions Precedent. The
Agency's obligation to provide any installment of the Affordable
Housing Development Grant under Section 2.01 shall be
conditioned upon the fulfillment of the following conditions
precedent (or waived in writing pursuant to Section 2.15): (i)
the Developer shall not be in default of any material term of
this Agreement to be performed by the Developer hereunder; and
(ii) each representation and warranty of the Developer made in
this Agreement shall remain true and correct.
Section 2.15. Satisfaction of Conditions Precedent.
Where satisfaction of any of the conditions precedent in this
Agreement requires action by the Developer or by the Agency,
each party shall use its diligent best efforts, in good faith,
and at its own cost, to satisfy such condition. Where
satisfaction of any condition requires the approval of a party,
such approval shall be in such party's sole and absolute
discretion. Either party may waive any of the conditions set
forth in the Agreement, but any such waiver shall be effective
only if contained in a writing signed by the applicable party
and delivered to the other party.
Section 2.16. Representations and Warranties.
(a) Warranties and Representations by the Agency.
The Agency hereby makes the following representations, covenants
and warranties and acknowledges that the execution of this
Agreement by the Developer has been made in material reliance by
the Developer on such covenants, representations and warranties:
(i) Warranties True. Each and every undertaking and
obligation of the Agency under this Agreement shall be
performed by the Agency timely when due; and that all
representations and warranties of the Agency under this
Agreement and its exhibits shall be true in all material
respects as of the Effective Date.
(ii) Due Organization. The Agency is a community
redevelopment agency, duly formed and operating under the
laws of California. The Agency has the legal power, right
and authority to enter into this Agreement and to execute
the instruments and documents referenced herein, and to
consummate the transactions contemplated hereby.
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(iii) Requisite Action. The Agency has taken all
requisi te action and obtained all requisite consents for
agreements or matters to which the Agency is a party in
connection with entering into this Agreement and the
instruments and documents referenced herein and in
connection with the consummation of the transactions
contemplated hereby.
(iv) Enforceability of Agreement. The persons
executing any instruments for or on behalf of the Agency
have been authorized to act on behalf of the Agency and
that this Agreement is valid and enforceable against the
Agency in accordance with its terms and each instrument to
be executed by the Agency pursuant hereto or in connection
therewi th will, when executed, shall be valid and
enforceable against the Agency in accordance with its
terms.
(v) Use of Agency Low-Mod Funds. The sole source of
funds which the Agency used to acquire the Agency Lot and
which the Agency shall use to make disbursements to the
Developer of each installment of the Affordable Housing
Development Grant, shall be derived from the low-and
moderate-income housing set aside funds of the Agency (as
this term is defined at Health and Safety Code Section
33334.2 and 33334.3 (b)) and from no other source of funds
of the Agency or the City of San Bernardino.
(b) Warranties and Representations by the Developer.
The Developer hereby makes the following representations,
covenants and warranties and acknowledges that the execution of
this Agreement by the Agency has been made in material reliance
by the Agency on such covenants, representations and warranties:
(1) The Developer is a duly organized and
validly existing California non-profit public benefit
corporation. The Developer has the legal right, power
and authority to enter into this Agreement and the
instruments and documents referenced herein and to
consummate the transactions contemplated hereby. The
persons executing this Agreement and the instruments
referenced herein on behalf of the Developer hereby
represent and warrant that such persons have the
power, right and authority to bind the Developer.
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(2) The Developer has taken all requisite action
and obtained all requisite consents in connection with
entering into this Agreement and the instruments and
documents referenced herein and the consummation of
the transactions contemplated hereby, and no consent
of any other party is required for the Developer's
authorization to enter into this Agreement.
(3) This Agreement is, and all agreements,
instruments and documents to be executed by the
Developer pursuant to this Agreement shall be, duly
executed by and are or shall be valid and legally
binding upon the Developer and enforceable in
accordance with their respective terms.
(4) The proj ect development cost pro forma as
prepared by the Developer and submitted to the Agency
as of the Effective Date is to the best information
and belief of the Developer, a fair and reasonable
presentation of the costs and expenses which the
Developer expects to incur as of the Effective Date
with respect to the development of the Project;
(5) The books and account records of the
Developer with respect to its confirmation and
certification as provided in Section 2.05, of Final
Project Costs shall conform to generally acceptable
principles of accounting;
(6) Neither the execution of this Agreement nor
the consummation of the transactions contemplated
hereby shall result in a breach of or constitute a
default under any other agreement, document,
instrument or other obligation to which the Developer
is a party or by which the Developer may be bound, or
under law, statute, ordinance, rule, governmental
regulation or any writ, injunction, order or decree of
any court or governmental body applicable to the
Developer;
(7) The Developer acknowledges that it has been
informed of the provisions of Labor Code Section 1720
by its legal counsel and that the Developer is aware
of the legal effect of its acceptance of the Agency
Affordable Housing Development Grant. The Developer
further represents and warrants to the Agency that the
Developer shall not accept any other financial
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assistance from any other public agency in connection
with the Project, including the City of San Bernardino
and the School District, unless the Developer also
complies with the applicable provisions of Labor Code
Section 1720 in connection with its acceptance of such
other assistance;
(8) If the School District Houses are not made
available to the Developer for relocation for any
reason, or in the event that the Developer is unable
or does not accept the condition of any such School
District House for any reason, or in the event that
the Developer is unable or does not accept any other
term or condition of the disposition of any School
District House, including any such condition imposed
by the Agency under Section 2.09 or Section 2.10 of
this Agreement, then in any of such events, the
Developer hereby covenants and warrants to the Agency
that the Developer shall exercise its best and
diligent efforts to obtain additional funding, if
necessary, from non-profi t affordable housing
development organizations to cause each of the up to
ten (10) Developer Lots which may not be improved with
Restored New Homes to be improved with a New SFD
Structure and made ready for occupancy by a Qualified
Homebuyer, within thirty (30) months following the
Effective Date;
(9) The Developer hereby covenants and warrants
that it shall use and apply 50% of its retained
earnings allowance, and/or any surplus development
funds from the proj ect after all final proj ect costs
are paid, as defined in Section 1.01, to acquire,
develop and/or rehabilitate additional housing units
at affordable rents or housing costs, in accordance
with state or federal law, whichever is applicable,
within the City of San Bernardino. The Developer
further covenants, represents, warrants and agrees
that it shall provide the Agency with audited
financial statements of the Developer for each of the
next four (4) accounting years of the Developer
following the date of completion of the proj ect to
evidence the Developer's compliance with this covenant
representation and warranty.
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(10) The representations and
Developer contained in this section
based upon the actual knowledge of
warranties of the
2.16 (b) shall be
All representations and warranties contained in this
Section 2.16 (b) are true and correct on the date hereof and on
the Effective Date.
(c) Change in Facts. If either party becomes aware
of any act or circumstance which would change or render
incorrect, in whole or in part, any representation or warranty
made by such party under this Agreement, whether as of the
Effective Date or any time thereafter and whether or not such
representation or warranty was based upon such party's knowledge
and/or belief as of a certain date, the Agency will give
immediate written notice of such changed fact or circumstance to
the other party, but such notice shall not release such party of
its liabilities or obligations with respect thereto.
section 2.17. Damage, Destruction and Condemnation.
(a) If the Project suffers damages as a result of any
casual ty prior to then the Developer shall give written notice
thereof to the Agency within thirty (30) days after the
occurrence of the casualty. The Developer elects in such notice
to the Agency to either: (i) repair or replace such casualty
loss or (ii) the Developer may terminate this Agreement, in
which case, the balance of the Affordable Housing Development
Grant as disbursed to the Developer shall be promptly refunded
to the Agency, and upon the receipt by the Agency of such
reimbursement, the parties shall be mutually released from
further responsibility under this Agreement.
(b) In the event that, prior to the completion of the
Project, any governmental entity shall commence any actions of
eminent domain or similar type proceedings to take any portion
of the Project, the Agency shall give prompt written notice
thereof to the Agency, and the Developer shall have the option
either: (i) to elect not to complete the Project and to promptly
refund the balance of the Affordable Housing Development Grant
as disbursed to the Developer and terminate the Agreement; or
(ii) the Developer may complete such portion of the Project as
not affected by such condemnation proceedings, in which case
Developer shall be entitled to retain the proceeds of such
taking; provided however, that the Developer shall reimburse the
Agency a portion of the balance of the Affordable Housing
Development Grant as previously disbursed to the Developer in a
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pro rated amount for each Developer Lot as so acquired by a
third party public agency in eminent domain. The Developer
shall confirm the exercise of its election under subparagraph
(i) or (ii) of the preceding sentence within thirty (30) days of
its receipt of notice of the initiation of any such condemnation
proceedings affecting the Project.
Section 2.18. Developer Market Reports to the Agency.
(a) From and after the date of the initial
disbursement of the Affordable Housing Development Grant by the
Agency to the Developer until the completion of the proj ect as
provided in Section 1.03, the Developer shall provide the Agency
with the following financial reports relating to the Project:
(i) within sixty (60) days of the end of each
calendar quarter and upon the request of the
Agency, a report on the status of the proj ect,
which shall include, at a minimum, the trial
balance, general ledger, cash receipt journal,
cash disbursements journal, sales journal, job
cost summary compared with the Project pro-forma,
bank statement, and quarterly profit and loss
statement, and schedule of cash flows and a
weekly sales report for New Homes, as applicable;
and
(ii) within one hundred twenty (120) days after the
end of each fiscal year of the Developer, an
annual unaudited financial statement, prepared by
the Developer for the Project, or, if obtained by
the Developer, an audited financial for the
Project.
(b) The Agency shall have the right to inspect the
business and financial records of the Developer as relate to the
proj ect and the presentation of the information described in
subsection (a), above and in Section 2.05 with respect to the
verification by the Agency of final Proj ect development costs.
The Developer shall provide the Agency (and its auditors or
accountants) with reasonable access to such business records
upon reasonable prior notice from the Agency. The Agency shall
pay for its copying and accounting costs associated with
inspection of the business records provided by the Developer to
the Agency for inspection.
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ARTICLE III
DEVELOPMENT OF THE DEVELOPER LOTS AND THE AGENCY LOT
Section 3.01. Development by Developer.
(a) Scope of Development. It is the intent of the
parties that the Developer Lots shall be developed as follows:
. if the School District Homes are made available
to the Developer and the Developer elects to
accept such School District Houses by the date
authorized in this Agreement, the proj ect shall
consist of the improvement and financing by the
Developer of at least two (2) Developer Lots with
a New SFD Structure as the New Homes on each such
lot, and up to fourteen (14) Restored New Homes
or New SFD Structures as the New Homes on 14 of
the other Developer Lots
-- OR --
. if either the School District Houses are not made
available to the Developer or if the Developer
may elect not to accept any such School District
Houses by the date authorized in this Agreement,
the Project shall consist of the improvement and
financing by the Developer of sixteen (16) New
SFD Structures as the New Homes on the Developer
Lots.
Each of the sixteen (16) New Homes shall be reserved for sale
and occupancy by Qualified Homebuyers whose Adjusted Family
Income at the time of initial occupancy of each New Home (e.g.,
close of the applicable New Home Escrow) does not exceed the
household income qualification limits of a Moderate-Income
Household.
(b) The City's zoning ordinance and the City's
building requirements will be applicable to the use and
development of the New Homes on each Developer Lot. The
Developer acknowledges that the plans for development of the New
Homes on the Developer Lots as set forth in the Scope of
Development (both the New SFD Structures as well as Restored New
Homes) shall be subject to the City's zoning ordinance and
building requirements. No action by the Agency or the City with
reference to this Agreement or related documents shall be deemed
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to constitute a waiver of any lawful city requirements which are
applicable to the Developer Lots or to the Developer, any
successor in interest of the Developer or any successor in
interest pertaining to the Developer Lots except by modification
or development variance approved by the City consistent with
this Agreement.
(c) The Scope of Development set forth in Exhibit "c"
is hereby approved by the Agency upon its execution of this
Agreement. The New Homes (e. g., the New SFD Structures and/or
the Restored New Homes, as applicable) shall be constructed and
improved on the Developer Lots in conformance with the Scope of
Development and any and all other plans, specifications and
similar development documents required by this Agreement, except
for such changes as may be mutually agreed upon in writing by
and between the Developer and the Agency and the mutual approval
of any such change shall not be unreasonably conditioned,
withheld or delayed. The approval by the City of any element of
the Project, which may be subject to the discretionary or
ministerial regulatory review of the City, shall be deemed to be
approved by the Agency.
(d) The approval of the Scope of Development by the
Agency hereunder shall not be binding upon the Common Council of
the City or the Planning Commission of the City with respect to
any regulatory approvals relating to the improvement of the New
Homes and/or the public improvements necessary for the
development of the Developer Lots as may be required by such
other bodies. If any material change of the Scope of
Development as previously approved by the Agency shall be
required by another government official, agency, department or
bureau having jurisdiction over the development of the Developer
Lots. The Agency shall not unreasonably withhold or delay
approval of such revisions to the Scope of Development; provided
however, that the Agency reserves the sole and absolute
discretion to approve or disapprove any agreement relating to
the inspection, relocation and disposition of School District
Houses as set forth in Section 2.09 and Section 2.10.
(e) The Developer agrees to accept and comply fully
wi th any and all lawful and reasonable conditions of approval
applicable to all permits and other governmental actions
affecting the development of the project.
(f) If required by the City, the Developer shall
cause landscaping plans in connection with development of the
Project to be prepared by a licensed landscape contractor.
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(g) The Developer shall prepare and submit
development plans, construction drawings and related documents
for the development of the Project consistent with the Scope of
Development to the City. The development plans, construction
drawings and related documents submitted by the Developer to the
City shall be in the form of final drawings, plans and
specifications. Such final drawings, plans and specifications
are hereby defined as those which contain sufficient detail
necessary to obtain a building permit from the City.
(h) During the preparation of all drawings and plans
in connection with the development of the New Homes and the
public improvements necessary for the development of the
Project, the Developer shall provide to the Agency regular
progress reports to advise the Agency of the status of the
preparation by the Developer, and the submission to and review
by the City of construction plans and related documents. The
Developer shall communicate and consult with the Agency as
frequently as is necessary to ensure that any such plans and
related documents submitted by the Developer to the City are
being processed in a timely fashion.
(i) The Agency shall have the
plans, drawings and related documents
development of the proj ect in order to
consistent with this Agreement and
Development.
right to review
pertinent to
ensure that they
with the Scope
all
the
are
of
(j) The Developer shall timely submit to the City for
its review and approval any and all plans, drawings and related
documents pertinent to the development of the Project, as
required by the City. The Agency shall cooperate with and shall
assist the Developer in order for the Developer to obtain the
approval of any and all development plans, construction drawings
and related documents submitted by the Developer to the City
consistent with this Agreement as promptly as feasible following
the City's receipt of such plans. Any failure by the City to
approve any of such plans or to issue necessary permits for the
construction of a New SFD Structure or for the relocation and
rehabilitation of a Restored New Home, as applicable, within
sixty (60) calendar day following submission by the Developer to
the City of complete and correct plans for such construction
shall constitute an enforced delay hereunder, and the Schedule
of Performance shall be extended by that period of time beyond a
sixty (60) calendar day period in which the City approves said
plans; provided, however, that in the event that the City
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disapproves of any of such plans, the Developer shall wi thin
thirty (30) calendar days after receipt of such disapproval
revise and resubmit such plans in accordance with the City's
requirements and in such form and substance so as to obtain the
City's approval thereof.
(k) In the case of each Restored New Home, the
Developer is responsible for undertaking and completing such
consultations with the State Office of Historic Preservation or
other interested persons relating to the relocation and
rehabilitation of the School District Homes/Restored New Homes
as the City Planning Department may direct, at the sole cost and
expense of the Developer. If applicable, such consultations
shall be completed within sixty (60) days following the date
that the School District Homes may be made available to the
Developer or within such shorter period of time as required by
the San Bernardino Unified School District. Notwithstanding any
other provision of this Agreement to the contrary, the Developer
shall obtain the written permission of the School District
before any such consultations may be initiated by the Developer
with respect to any School District House.
(1) The Agency shall approve any modified or revised
plans, drawings and related documents to which reference is made
in this Agreement as long as such modified or revised plans,
drawings and related documents are generally consistent with the
Scope of Development and any other plans which have been
approved by the Agency. Upon any disapproval of such modified
or revised plans, drawings or related documents, the Agency
shall state in writing the reasons for such disapproval. The
Developer, upon receipt of notice of any disapproval, shall
promptly revise such disapproved portions of the plans, drawings
or related documents in a manner that addresses the reasons for
disapproval and reasonably meets the requirements of the Agency
in order to obtain the Agency's approval thereof. The Developer
shall resubmit such revised plans, drawings and related
documents to the Agency as soon as possible after its receipt of
the notice of disapproval and, in any event, no later than
thirty (30) calendar days thereafter. The Agency shall approve
or disapprove such revised plans, drawings and related documents
in the same manner and within the same times as provided in this
Section for approval or disapproval of plans, drawings and
related documents initially submitted to the Agency, and if no
specific time for approval if specified then the Agency shall so
approve or disapprove the proposed modifications or revisions
promptly upon the written request of the Developer.
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(m) If the Developer desires to make any material
change in the final construction drawings, plans and
specifications and related documents after their approval by the
Agency and/or the City (either with respect to a New SFD
Structure or with respect to any Restored New Home), the
Developer shall submit the proposed change in writing to the
Agency and/or the City for approval. The Agency shall notify
the Developer of approval or disapproval thereof in writing
within thirty (30) calendar days after submission to the Agency.
This thirty (30) calendar day period may be extended by mutual
consent of the Developer and the Agency. Any such change shall,
in any event, be deemed to be approved by the Agency unless
rejected, in whole or in part, by written notice thereof
submitted by the Agency to the Developer, setting forth in
detail the reasons therefor, and such rej ection shall be made
wi thin said thirty (30) calendar day period unless extended as
permitted herein. The Agency shall use its best efforts to
cause the City to review and approve or disapprove any such
change as provided in Section 3.01(j) hereof.
(n) The Developer, upon receipt of written notice of
disapproval of a proposed change in construction drawings, plans
and specifications by the Agency and/or the City for a New SFD
Structure or for a Restored New Home, as applicable, may revise
such portions of the proposed change in construction drawings,
plans and specifications and related documents as are rejected
and shall thereafter resubmit such revisions to the Agency
and/or the City for approval in the manner provided in
Section 3.01(j) hereof.
(0) The Developer shall have the right during the
course of construction to make changes in construction
concerning the interior design of the New Homes and "minor field
changes" with respect to the New Homes, and to make "minor field
changes" to the public improvements necessary for the
development of the Project without seeking the approval of the
Agency; provided, however, that such changes do not affect the
type of use to be conducted within all or any portion of a New
Home or the ability of the City to accept the completion of the
public improvements necessary for the development of the
Project; and further provided that the City has approved any
such minor field change to either a New Home or the public
improvements necessary for the development of the proj ect in
accordance with the standards and practices of the City Building
Department and/or City Public Works Department, as applicable.
Said "minor field changes" shall be defined as those changes
from the approved final construction drawings, plans and
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specifications which have no substantial effect on the
improvements and are made in order to expedite the work of
construction in response to field conditions. Nothing contained
in this subsection shall be deemed to constitute a waiver of or
change in the City's Building Code or Public Works Department
requirements governing such "minor field changes" or in any and
all approvals by the City otherwise required for such "minor
field changes."
(p) Except as otherwise specified in this Agreement,
the cost of constructing the New Homes and all other
improvements on the Project shall be paid for by the Developer;
provided however, that the Agency shall be obligated to the
Developer to pay the Agency Affordable Housing Development Grant
in the installments as provided in Section 2.01.
(q) Developer shall pay the school capital facility
development improvement fees as required and at the time
specified by the San Bernardino Unified School District. All
other development fees imposed by the City as a condition of
issuance of any permit for the development of the Project shall
be paid by the Developer to the City at the time of issuance of
each such permit or, subject to the approval of the City in its
discretion, at the close of each New Home Escrow, pursuant to
the terms of the City of San Bernardino's Development Fee
Deferral program as may then be in effect.
(r) The Developer shall at its expense cause to be
prepared, and shall pay any and all fees pertaining to the
review and approval thereof by the City, all required
construction, planning and other documents reasonably required
by governmental bodies pertinent to the development of the
Project hereunder including, but not limited to the public
improvements necessary for the development of each New Home and
to the specifications, drawings, plans, maps, permit
applications, land use applications, zoning applications and
design review documents for the New Homes.
(s) The Developer shall pay for any and all costs,
including but not limited to the costs of design, construction,
relocation and securing of permits for utility improvements and
connections, which may be required in developing each New Home.
The Developer shall obtain any and all necessary approvals prior
to the commencement of applicable portions of said construction,
and the Developer shall take reasonable precautions to ensure
the safety and habitability of surrounding properties during
said construction.
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(t) The Developer shall begin and complete all
construction and development and undertake all obligations and
responsibilities of the Developer within the times specified in
the Schedule of Performance, or within such reasonable
extensions of such times as may be granted by the Agency or as
otherwise provided for in this Agreement. The Schedule of
Performance shall be subj ect to revision from time to time as
mutually agreed upon in writing by and between the Developer and
the Agency. Any and all deadlines for performance by the
parties shall be extended for any times attributable to delays
which are not the fault of the performing party and are caused
by the other party, other than periods for review and approval
or reasonable disapprovals of plans, drawings and related
documents, specifications or applications for permits as
provided in this Agreement.
(u) Prior to and during the period of construction of
the New Homes the Developer (including the period of time in
which any School District House is being relocated from School
District Lands to a Developer Lot) shall submit to the Agency
written progress reports when and as reasonably requested by the
Agency but in no event more frequently than every twelve (12)
weeks. The reports shall be in such form and detail as may
reasonably be required by the Agency. In addition, the
Developer will attend Agency meetings when requested to do so by
Agency Staff.
(v) Prior to any distribution of the Affordable
Housing Development Grant, the Developer shall furnish, or shall
cause to be furnished, to the Agency duplicate originals or
appropriate certificates of public indemnity and liability
insurance in the amount of Two Million Dollars ($2,000,000.00)
combined single limit, naming the Agency, the City and the
elected officers, officials, employees, attorneys and agents of
both of them, as additional insureds. Said insurance shall
cover comprehensive general liability including, but not limited
to, contractual liability; acts of subcontractors; premises-
operations; explosion, collapse and underground hazards, if
applicable; broad form property damage, and personal injury
including libel, slander and false arrest. In addition, the
Developer shall provide to the Agency adequate proof of
comprehensive automobile liability insurance covering owned,
non-owned and hired vehicles, combined single limit in the
amount of One Million Dollars ($1,000,000.00) each occurrence;
and proof of workers' compensation insurance. Any and all
insurance policies required hereunder shall be obtained from
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insurance companies admitted in the State of California and
rated at least B+: XII in Best's Insurance Guide, or in special
circumstances, be preapproved by both the Executive Director of
the Agency and the Agency General Counsel. All said insurance
policies shall provide that they may not be canceled unless the
Agency and the City receive written notice of cancellation at
least thirty (30) calendar days prior to the effective date of
cancellation. Any and all insurance obtained by the Developer
hereunder shall be primary to any and all insurance which the
Agency and/or City may otherwise carry, including self
insurance, which for all purposes of this Agreement shall be
separate and apart from the requirements of this Agreement. Any
insurance policies governing the Project as obtained by the
Agency shall not be transferred from the Agency to the
Developer. Appropriate insurance means those insurance policies
approved by the Agency Counsel consistent with the foregoing.
Any and all insurance required hereunder shall be maintained and
kept in force until the Agency has issued the final Certificate
of Completion in connection with the development of the Project.
(w) The Developer for itself and its successors and
assigns agrees that in the construction of the New Homes and the
undertaking of the Project, the Developer will not discriminate
against any employee or applicant for employment because of sex,
marital status, race, color, religion, creed, national origin,
or ancestry.
(x) The Developer shall carry out its construction of
the improvements of the New Homes and the undertaking of the
Project in conformity with all applicable laws, including all
applicable State labor standards and requirements and with
respect to the development of the Project.
(y) The Developer shall, at its own expense, secure
or shall cause to be secured, any and all permits which may be
required for the construction, development or work of the
Project by the City or any other governmental agency having
jurisdiction thereof.
(z) Officers, employees, agents or representatives of
the Agency and the City shall have the right of reasonable
access to the Developer Lots, during normal business hours
during the period of construction for the purposes of monitoring
the Developer's performance under this Agreement.
Section 3.02. Property Taxes and Assessments. The
Developer shall pay prior to the delinquency all real property
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taxes and assessments assessed and levied on or against the
Developer Lots prior to the close of each New Home Escrow.
Nothing herein shall be deemed to prohibit the Developer from
contesting the validity or amounts of any tax assessment,
encumbrance or lien, nor to limit the remedies available to the
Developer in respect thereto.
Section 3.03. Prohibition Against Transfer.
(a) Prior to the completion of the Project as set
forth in section 1.03, the Developer shall not, without prior
written approval of the Agency or except as permitted by this
Agreement, (i) assign or attempt to assign this Agreement or any
right herein or (ii) make any total or partial sale, transfer,
conveyance, lease, leaseback, or assignment of any Developer Lot
or permit to be placed on any Developer Lot any unauthorized
mortgage, trust deed, deed of trust, encumbrance or lien. This
prohibi tion shall not apply to any of the following: (1) the
reasonable grant by the Developer of utility easements or
permits to facilitate the development of any Developer Lot; (2)
the assignment of all of the Developer's interest in this
Agreement to a limited liability company of which the Developer
is the managing member (and the assumption of such interest by
such limited liability company); (3) any permitted construction
financing interest under Section 3.04; and (4) sales by the
Developer of individual New Homes.
(b) In the absence of specific written agreement or
approval by the Agency, no unauthorized sale, transfer,
conveyance, lease, leaseback or assignment of a Developer Lot
shall be deemed to relieve the Developer or any other party from
any obligations under this Agreement.
(c) Developer shall not lease or rent any of the New
Homes, or any structure or any Developer Lot for commercial or
residential occupancy by any person, pending final sale to a
Qualified Homebuyer.
Section 3.04. Security Financing; Right of Holders.
(a) The words "mortgage" and "deed of trust" as used
herein shall be deemed to include all other customary and
appropriate modes of financing real estate construction and land
development. Notwi thstanding any provision of Section 3.03 to
the contrary, mortgages, deeds of trust, or any other form of
lien required for any reasonable method of financing the
construction and improvement of the Project are permitted on any
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Developer Lot before the completion of the Project. The
Developer shall notify the Agency in writing in advance of any
mortgage, deed of trust, or other form of lien for financing of
the proj ect which the Developer proposes to be secured by any
Developer Lot before the recordation of any such Project-related
construction financing security interests. The Developer shall
not enter into any such conveyance for construction financing
without the prior written approval of the Agency, which approval
the Agency shall grant if: (i) any such conveyance is given to
a responsible financial or lending institution including,
without limitation, banks, savings and loan institutions,
insurance companies, real estate investment trusts, pension
programs and the like, or other acceptable persons or entities
for the purpose of financing the construction of the New Homes
on the Developer Lots, and (ii) such loan contains customary
construction lender disbursement controls.
(b) The Developer shall promptly notify the Agency of
any mortgage, deed of trust or other refinancing, encumbrance or
lien that has been created or attached thereto prior to
completion of the construction of the New Homes whether by
voluntary act of the Developer or otherwise; provided, however,
that no notice of filing of preliminary notices or mechanic 's
liens need be given by the Developer to the Agency prior to suit
being filed to foreclose such mechanic's lien.
(c) The holder of any mortgage, deed of trust or
other security interest authorized by this Agreement shall in no
manner be obligated by the provisions of this Agreement to
construct or complete the proj ect or to guarantee such
construction or completion; provided however, that each surety
under any completion and payment surety bond delivered by the
Developer to the City of San Bernardino, if any, under the terms
of any off-site improvement permit issued by the City to the
Developer, shall not, by the virtue of any term of this
Agreement, be deemed to be discharged from its obligation to the
City as arises under such surety.
(d) In the event of a default or breach by the
Developer of a mortgage, deed of trust or other security
interest with respect to the Project or any Developer Lot prior
to the completion of the Project and the holder of such security
interest has not exercised its option to complete the Project,
the Agency may cure the default of the Developer with respect to
one or more of the Developer Lots, but is under no obligation to
do so prior to completion of any foreclosure. In the event that
the Agency may cure any such default by the Developer, the
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Agency shall be entitled to reimbursement from the Developer of
all costs and expenses incurred by the Agency in curing the
default. The Agency shall also be deemed to have a lien of the
Agency as may arise under this Section 3.04(d) upon the Project
(or any Developer Lot) to the extent of such costs and
disbursements. Any such lien shall be subordinate and subject
to mortgage, deed of trust or other security instrument executed
by the Developer encumbering the applicable Developer Lots.
ARTICLE IV
USE OF THE DEVELOPER LOTS
Section 4.01. Uses.
(a) The Developer covenants and agrees for itself,
its successors, and assigns that each of the sixteen (16) New
Homes to be developed, constructed and improved on Developer
Lots, shall be reserved for sale and occupancy by Qualified
Homebuyers whose Adj usted Family Income at the time of initial
occupancy of each New Horne does not exceed the household income
qualification limits of a Moderate-Income Household.
The Developer shall cause to be recorded at the time
of close of each New Horne Escrow for each of the fully executed
form of the Section 33334.3 Covenant. The final form of the
Section 33334.3 Covenant shall be delivered to the escrow holder
for execution by the Developer and the Qualified Homebuyer at
the time of close of each New Horne Escrow. If the Qualified
Homebuyer may use Agency MAP funds for the purchase of the New
Horne from the Developer, the Qualified Homebuyer and the Agency
shall execute a separate set of redevelopment affordability
covenants in favor of the Agency to evidence the obligation of
the Qualified Homebuyer to the Agency which arise by virtue of
the Qualified Homebuyer's acceptance of Agency MAP Funds under
the Agency MAP program.
community
Developer
The provisions
redevelopment
Lot.
of this Section 4.01 shall
covenant which shall run with
be a
each
(b) The Developer further covenants and agrees for
itself, its successors and assigns that each of the Developer
Lots shall be improved, developed and used in accordance with
the Scope of Development. Developer covenants to develop and
use the Developer Lots in conformity with all applicable laws.
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(c) Developer shall not lease or
Developer Lots, or any New Home constructed
final sale to a Qualified Homebuyer.
rent any
thereon,
of the
pending
(d) Provided the Developer is not then in default,
the Developer may obtain a release of the provisions of the
housing affordability covenant set forth in Section 4.01 (a) for
up to five (5) of the Developer Lots, as may be hereafter
designated by the Developer, subj ect to the provisions of this
Section 4.01 (d) . The Developer may, but is not obligated, to
request the Executive Director of the Agency to release the
housing affordability covenant set forth in Section 4.01 for up
to five (5) Developer Lots upon the payment to the Agency of the
sum of Twelve Thousand Five Hundred Dollars ($12,500) per each
such Developer Lot, plus interest commencing on the date that
the Developer receives the Affordable Housing Development Grant
under Section 2.01 (c) for the particular Developer Lot to be so
released, at the rate of six percent (6%) per annum to the date
of such release. For the purposes of calculation of the Final
Project Costs under Section 2.07(b), any amount of interest paid
by the Developer to the Agency under the preceding sentence of
this Section 4.0l(d), plus any other cost incurred by the
Developer for the acquisition, construction and improvement of
any Developer Lot as released, shall be excluded from the
calculation of "Final Project Costs". For the purposes of
calculation of the "Retained Earnings of the Developer", if any
under Section 2.08, any amount of profit or retained earnings
realized by the Developer following the payment to the Agency of
such release amount for the Developer Lot(s)/New Home(s), shall
mean and refer to the profit or net earnings realized by the
Developer from only those remaining Developer Lots/New Homes
which have not been so released from the housing affordability
covenant of this Section 4.01.
Section 4.02. Maintenance of the Developer Lots. The
Developer covenants and agrees for itself, its successors, and
assigns to maintain each of the Developer Lots in a good
condition free from any accumulation of debris or waste
material, subject to normal construction job-site conditions,
and shall maintain in a neat, orderly, healthy and good
condi tion the landscaping on each Developer Lot required to be
planted in accordance with the Scope of Development. In the
event the Developer, or its successors or assigns, fails to
perform the maintenance as required herein, the Agency shall
have the right, but not the obligation, to enter any Developer
Lot and undertake, such maintenance activities. In such event,
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the Developer shall reimburse the Agency for all reasonable sums
incurred by it for such maintenance acti vi ties. The obligation
of the Developer under this Section 4.02 with respect to the
Developer Lots shall be discharged for each Developer Lot on the
applicable Delivery Date to the Qualified Homebuyer.
Section 4.03. Obligation to Refrain from
Discrimination. The Developer covenants and agrees for itself,
its successors, its assigns and every successor in interest to
each of the Developer Lots, that there shall be no
discrimination against or segregation of any person, or group of
persons, on account of sex, marital status, race, color,
religion, creed, national origin or ancestry in the sale, lease,
sublease, transfer, use, occupancy, tenure or enjoyment of the
Site; nor shall the Developer, itself or any person claiming
under or through it, establish or permit any such practice or
practices of discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessee or vendees of the Developer Lots.
Section 4.04. Form of Nondiscrimination and
Nonseqreqation Clauses. The Developer covenants and agrees for
itself, its successors, its assigns, and every successor in
interest to the Developer Lots, and each of them, or any part
thereof, that the Developer, such successors and such assigns
shall refrain from restricting the sale, lease, sublease,
rental, transfer, use, occupancy, tenure or enjoyment of each of
the Developer Lots and each of the New Homes, on the basis of
sex, marital status, race, color, religion, creed, ancestry or
national origin of any person. All deeds, leases or contracts
pertaining thereto shall contain or be subject to substantially
the following nondiscrimination or nonsegregation clauses:
(a) In deeds: "The grantee herein covenants by and for
itself, its successors and assigns, and all persons
claiming under or through them, that there shall be no
discrimination against or segregation of, any person or
group of persons on account of race, color, creed,
religion, sex, marital status, national origin, or ancestry
in the sale, lease, sublease, transfer, use, occupancy,
tenure, or enjoyment of the premises herein conveyed, nor
shall the grantee or any person claiming under or through
it, establish or permit any such practice or practices of
discrimination or segregation with reference to the
selection, location, number, use or occupancy of tenants,
lessees, subtenants, sublessee, or vendees in the premises
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herein conveyed.
the land."
The foregoing covenants shall run with
(b) In leases: "The Lessee herein covenants by and for
itself , its successors and assigns, and all persons
claiming under or through them, and this lease is made and
accepted upon and subject to the following conditions:
That there shall be no discrimination against or
segregation of any person or group of persons, on account
of race, color, creed, religion, sex, marital status,
national origin, or ancestry, in the leasing, subleasing,
transferring, use, occupancy, tenure, or enjoyment of the
premises herein leased nor shall the lessee itself, or any
person claiming under or through it, establish or permit
any such practice or practices of discrimination or
segregation with reference to the selection, location,
number, use, or occupancy, of tenants lessees, sublessee,
subtenants, or vendees in the premises herein leased."
(c) In contracts: "There shall be no discrimination
against or segregation of any person or group of persons on
account of race, color, creed, religion, sex, marital
status, national origin, or ancestry, in the sale, lease,
sublease, transfer, use, occupancy, tenure, or enjoyment of
the premises herein conveyed or leased, nor shall the
transferee or any person claiming under or through it,
establish or permit any such practice or practices of
discrimination or segregation with reference to the
selection, location, number, use, or occupancy, of tenants,
lessees, sublessees, subtenants, or vendees of the premises
herein transferred." The foregoing provision shall be
binding upon and shall obligate the contracting party or
parties and any subcontracting party or parties, or other
transferees under the instrument.
Section 4.05. Effect and Duration of Covenants Under
Section 4.01 and Section 4.04. The covenants established under
Section 4.04 against discrimination shall remain in effect in
perpetuity. The covenant respecting uses and occupancy of each
New Home which shall be initially occupied by a Qualified
Homebuyer as set forth in Section 4.01(a), shall remain in
effect for the Qualified Residence Period of each such New Home
(e.g., forty five (45) years following the Delivery Date to the
Qualified Homebuyer), and shall run with the land and shall
constitute equitable servitudes thereon, and shall, without
regard to technical classification and designation, be binding
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for the benefit and in favor of the Agency, its successors and
assigns and the City.
The Agency is deemed the beneficiary of the terms an
provisions of this Agreement and of the covenants running with
the land for and in its own rights and for the purposes of
protecting the interests of the community. The Agency shall
have the right, if such covenants are breached, to exercise all
rights and remedies and to maintain any actions or suits at law
or in equity or such other proper proceedings to enforce the
curing of such breaches to which it or any other beneficiary of
such covenants may be entitled, including, without limitation,
to specific performance, damages and injunctive relief. The
Agency shall have the right to assign all of its rights and
benefits hereunder to the City.
ARTICLE V
DEFAULTS, REMEDIES AND TERMINATION
Section 5.01. Defaults - General.
(a) Subj ect to the extensions of time set forth in
Section 6.05 hereof, failure or delay by either party to perform
any term or provision of this Agreement shall constitute a
default under this Agreement; provided, however, that if a party
otherwise in default commences to cure, correct or remedy such
default within thirty (30) calendar days after receipt of
written notice specifying such default and shall diligently and
continuously prosecute such cure, correction or remedy to
completion (and where any time limits for the completion of such
cure, correction or remedy are specifically set forth in this
Agreement, then within said time limits), such party shall not
be deemed to be in default hereunder.
(b) The injured party shall give written notice of
default to the party in default, specifying the default
complained of by the non-defaulting party. Delay in giving such
notice shall not constitute a waiver of any default nor shall it
change the time of default.
(c) Any failure or delays by either party in
asserting any of its rights and remedies as to any default shall
not operate as a waiver of any default or of any such rights or
remedies. Delays by either party in asserting any of its rights
and remedies shall not deprive either party of its right to
institute and maintain any actions or proceedings which it may
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deem necessary to protect, assert or enforce any such rights or
remedies.
Section 5.02. Legal Actions.
(a) In addition to any other rights or remedies,
either party may institute legal action to cure, correct or
remedy any default, to recover damages for any default, or to
obtain any other remedy consistent with the purposes of this
Agreement. Such legal actions must be instituted in the
Superior Court of the County of San Bernardino, State of
California, in any other appropriate court in that County, or in
the Federal District Court in the Central District of
California.
(b) The laws of the State of California shall govern
the interpretation and enforcement of this Agreement.
(c) In the event that any legal action is commenced
by the Developer against the Agency, service of process on the
Agency shall be made by personal service upon the Executive
Director or Chairman of the Agency, or in such other manner as
may be provided by law.
(d) In the event that any legal action is commenced
by the Agency against the Developer, service of process on the
Developer shall be made by personal service on
(or such other agent for service of process and at such address
as may be specified in written notice to the Agency), or in such
other manner as may be provided by law, and shall be valid
whether made within or without the State of California.
Section 5.03. Riqhts and Remedies are Cumulative.
Except with respect to any rights and remedies expressly
declared to be exclusive in this Agreement, the rights and
remedies of the parties are cumulative and the exercise by
either party of one or more of such rights or remedies 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.
Section 5.04. Damaqes If either party defaults with
regard to any provision of this Agreement following the
Effective Date, the non-defaulting party shall serve written
notice of such default upon the defaulting party. If the
defaulting party does not diligently commence to cure such
default within thirty (30) calendar days after service of the
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notice of default and promptly complete the cure of such default
within a reasonable time, not to exceed ninety (90) calendar
days (or such shorter period as may otherwise be specified in
this Agreement for any specific default), after the service of
written notice of such default, the defaulting party shall be
liable to the other party for damages caused by such default.
ARTICLE VI
GENERAL PROVISIONS
Section 6.01. Notices,
Between the Parties.
Demands
and
Communications
(a) Any and all notices, demands or communications
submitted by any party to another party pursuant to or as
required by this Agreement shall be proper if in writing and
dispatched by messenger for immediate personal deli very, or by
registered or certified United States mail, postage prepaid,
return receipt requested, to the principal office of the Agency
and the Developer, as applicable, as designated in Section
1.02(a) and Section 1.02(b) hereof. Such written notices,
demands and communications may be sent in the same manner to
such other addresses as either party may from time to time
designate as provided in this Section. Any such notice, demand
or communication shall be deemed to be received by the
addressee, regardless of whether or when any return receipt is
received by the sender or the date set forth on such return
receipt, on the day that it is dispatched by messenger for
immediate personal deli very, or two (2) calendar days after it
is placed in the United States mail as heretofore provided.
(b) In
or communications
all notices shall
addition to the submission of notices, demands
to the parties as set forth above, copies of
also be delivered by facsimile as follows:
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to the Developer:
Creative Housing Solutions
3233 Grand Avenue
No. 76
Chino Hills, California 91709
to the Agency:
Redevelopment Agency of the City
of San Bernardino
201 North "E" Street
Suite 301
San Bernardino, CA 92401
FAX: (909) 888-9413
Section 6.02. Conflict of Interest. No member,
official or employee of the Agency having any conflict of
interest, direct or indirect, related to this Agreement, or in
the development of the Site, shall participate in any decision
relating to this Agreement. The parties represent and warrant
that they do not have knowledge of any such conflict of
interest.
Section 6.03. Warranty Against Payment of
Consideration for Agreement. The Developer warrants that it has
not paid or given, and will not payor give, any third party any
money or other consideration for obtaining this Agreement.
Third parties, for the purposes of this Section, shall not
include persons to whom fees are paid for professional services
if rendered by attorneys, financial consultants, accountants,
engineers, architects and the like when such fees are considered
necessary by the Developer.
Section 6.04. Nonliability of Agency Officials and
Employees. No member, official or employee of the Agency shall
be personally liable to the Developer, or any successor in
interest, in the event of any default or breach by the Agency or
for any amount which may become due to the Developer or to its
successor, or on any obligations under the terms of this
Agreement, except for gross negligence or willful acts of such
member, officer or employee.
Section 6.05. Enforced Delay: Extension of Time of
Performance. In addition to specific provisions of this
Agreement, performance by either party hereunder shall not be
deemed to be in default, or considered to be a default, where
delays or defaults are due to the force maj eure events of war,
insurrection, strikes, lockouts, riots, floods, earthquakes,
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fires, casualties, acts of God, acts of the public enemy,
epidemics, quarantine restrictions, freight embargoes or lack of
transportation, weather-caused delays, inability to secure
necessary labor, materials or tools, delays of any contractors,
subcontractor or supplier, which are not attributable to the
fault of the party claiming an extension of time to prepare or
acts or failure to act of any public or governmental agency or
entity (provided that acts or failure to act of the city or
Agency shall not extend the time for the Agency to act hereunder
except for delays associated with lawsuit or injunction
including but without limitation to lawsuits pertaining to the
approval of the Agreement, and the like). An extension of time
for any such force majeure cause shall be for the period of the
enforced delay and shall commence to run from the date of
occurrence of the delay; provided however, that the party which
claims the existence of the delay has first provided the other
party with written notice of the occurrence of the delay within
ten (10) days of the commencement of such occurrence of delay.
The inability of the Developer to obtain a
satisfactory commitment from a construction lender for the
improvement of the Project or to satisfy any other condition of
this Agreement relating to the redevelopment of the Developer
Lots shall not be deemed to be a force majeure event or
otherwise provide grounds for the assertion of the existence of
a delay under this Section 6.05. The parties hereto expressly
acknowledge and agree that changes in either general economic
conditions or changes in the economic assumptions of any of them
which may have provided a basis for entering into this Agreement
and which occur at any time after the execution of this
Agreement, are not force majeure events and do not provide any
party with grounds for asserting the existence of a delay in the
performance of any covenant or undertaking which may arise under
this Agreement. Each party expressly assumes the risk that
changes in general economic conditions or changes in such
economic assumptions relating to the terms and covenants of this
Agreement could impose an inconvenience or hardship on the
continued performance of such party under this Agreement, but
that such inconvenience or hardship is not a force majeure event
and does not excuse the performance by such party of its
obligations under this Agreement.
Section 6.06. Inspection of Books and Records. The
Agency shall have the right at all reasonable times at the
Agency's cost and expense to inspect the books and records of
the Developer pertaining to the proj ect, as necessary for the
Agency, in its reasonable discretion, to enforce its rights
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under this Agreement. Matters discovered by the Agency shall
not be disclosed to third parties unless required by law or
unless otherwise resulting from or related to the pursuit of any
remedies or the assertion of any rights of the Agency hereunder.
The Developer shall also have the right at all reasonable times
to inspect the books and records of the Agency pertaining to the
Site and/or the development thereof as pertinent to the purposes
of this Agreement.
Section 6.07. Approvals.
(a) Except as otherwise provided in this Agreement,
approvals required of the Agency or the Developer, or any
officers, agents or employees of either the Agency or the
Developer, shall not be unreasonably withheld and approval or
disapproval shall be given wi thin the time set forth in the
Schedule of Performance or, if no time is given, within a
reasonable time.
(b) The Executive Director of the Agency is
authorized to sign on his or her own authority amendments to
this Agreement which are of routine or technical nature,
including minor adjustments to the Schedule of Performance.
Section 6.08. Real Estate Commissions. The Agency
shall not be liable for any real estate commissions, brokerage
fees or finder fees which may arise or be purported to arise
from or related to this Agreement.
Section 6.09. Indemnification. The Developer agrees
to indemni fy and hold the City, the Agency, and the elected
officers, officials, employees, attorneys and agents of both of
them, harmless from and against all damages, judgments, costs,
expenses and fees arising from or related to any act or omission
of the Developer in performing its obligations hereunder. The
Agency agrees to indemnify and hold the Developer and its
officers, employees and agents, harmless from and against all
damages, judgments, costs, expenses and fees arising from or
related to any act or omission of the Agency in performing its
obligations hereunder.
Section 6.10. Attorneys' Fees. If either party
hereto files any action or brings any action or proceeding
against the other arising out of this Agreement, or is made a
party to any action or proceeding brought by the Escrow Holder
or a third party, then as between the Developer and the Agency,
the prevailing party shall be entitled to recover as an element
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of its costs of suit, and not as damages, its reasonable
attorneys' fees as fixed by the Court, in such action or
proceeding or in a separate action or proceeding brought to
recover such attorneys' fees. For the purposes hereof the words
"reasonable attorneys' fees" mean and include in the case of the
Agency to salaries and expenses of the lawyers employed by the
Office of City Attorney (allocated on an hourly basis) who may
provide legal services to the Agency in connection with the
representation of the Agency in any such matter.
Section 6.11. Effect. This
binding upon and inure to the benefit of
their respective heirs, executors,
representatives, successors and assigns.
Agreement shall be
the parties hereto and
administrators, legal
ARTICLE VII
ENTIRE AGREEMENT, WAIVERS AND AMENDMENT
Section 7.01. Entire Agreement.
(a) This Agreement shall be executed in two (2)
originals each of which is deemed to be an original. This
Agreement includes ___ pages and seven (7) attachments (See list
of attachments at Section 1.05), which constitute the entire
understanding and Agreement of the parties.
(b) All waivers of the provisions of this Agreement
and all amendments hereto must be in writing and signed by the
appropriate representations of the Agency and the Developer.
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IN WITNESS WHEREOF, the parties hereto have duly
executed this Agreement as of the dates set forth below.
AGENCY
Date' 1/11 /G,]
Redevelopment Agency of the
City of San Bernardino
By:
APPROVED AS TO FORM:
. ~<i~L
Agency Speci 1 Counsel
Agency Chair (Not Applicable)
\....,/']~ n
By: tUh~'--'
Agency xecutlve Dlrector
:p~?U ~ 1) //tvdrV
DEVELOPER
Date: A?<ZIL- 6. ~'>
J
Creative Housing Solutions,
a California non-profit
B:OQC~2 ~
By:
60
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CDC/2003-7
EXHIBIT "A"
Legal Description of Developer Lots
Exh. "A" - 1
CDC/2003-7
EXHIBIT" A"
Creative Housing Solutions
"Old Town Project Area"
Properties either Closed or In Escrow
February 21,2003
APN#
1. 0134-012-08
2. 0134-012-09
3. 0134-022-02
4. 0134-022-03
5. 0134-022-13
6. 0134-022-14
7. 0134-022-15
8. 0134-014-24
9. 0134-014-25
10.0134-014-26
11. 0140-263-18
12.0134-014-27
13.0134-013-18
14.0134-011-16
15.0140-261-15
16.0140-192-27
0140-192-26
0140-192-25
Address
835 Victoria
Victoria & H St
Victoria & ih St
Victoria & ih St
Victoria & ih St
Victoria & ih St
Victoria & ih St
626 N G St
G St & 6th St
G St & 6th St
718WihSt
740 W 6th St
640 N Crescent
Victoria & H St
752 N. H St
825 N. H St
CDC/2003-7
EXHIBIT "B"
Form of Notice of Agreement
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Exh. "B" - 1
CDC/2003-7
RECORDING REQUESTED BY
WHEN RECORDED MAIL TO:
Redevelopment Agency of the
City of San Bernardino
201 North ~E" Street, Suite 301
San Bernardino, California 92401
Attn: Executive Director
(SPACE ABOVE LINE FOR USE BY RECORDER)
REDEVELOPMENT AGENCY OF THE CITY
OF SAN BERNARDINO
NOTICE OF AGREEMENT RELATING TO REAL PROPERTY
(Creative Housing Solutions)
TO ALL INTERESTED PERSONS:
PLEASE TAKE NOTICE that as of the date of recordation of
this Notice of Agreement Relating to Real Property, Creative
Housing Solutions, a California non-profit public benefit
corporation (the ~Developer") and the Redevelopment Agency of
the City of San Bernardino, a body corporate and politic (the
~Agency") have entered into an agreement entitled:
~Old Towne Single Family Residential Acquisition and
Construction Grant Funding Agreement".
This Notice of Agreement Relating to Real Property affects
the property descried as follows:
[INSERT TEXT OF LEGAL DESCRIPTION FOR EACH DEVELOPER LOT]
Section 4.01 of the Old Towne Single Family Residential
Acquisition and Construction Grant Funding Agreement contains a
community redevelopment covenant relating to the development and
preservation of affordable housing on the property described in
the preceding paragraph of this Notice of Agreement Relating to
Real Property. Section 4.01 provides as follows:
~Section 4.01. Uses
itself,
sixteen
(a)
its
(16)
The Developer
successors, and
New Homes to be
covenants and agrees
assigns that each of
developed, constructed
for
the
and
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Exh. "B" - 2
CDC/2003-7
improved on Developer Lots, shall be reserved for sale and
occupancy by Qualified Homebuyers whose Adjusted Family
Income at the time of initial occupancy of each New Home
does not exceed the household income qualification limits
of a Moderate-Income Household.
The Developer shall cause to be recorded at the
time of close of each New Home Escrow for each of the fully
executed form of the Section 33334.3 Covenant. The final
form of the Section 33334.3 Covenant shall be delivered to
the escrow holder for execution by the Developer and the
Qualified Homebuyer at the time of close of each New Home
Escrow. If the Qualified Homebuyer may use Agency MAP
funds for the purchase of the New Home from the Developer,
the Qualified Homebuyer and the Agency shall execute a
separate set of redevelopment affordability covenants in
favor of the Agency to evidence the obligation of the
Qualified Homebuyer to the Agency which arise by virtue of
the Qualified Homebuyer's acceptance of Agency MAP Funds
under the Agency MAP program.
The provisions of this Section 4.01 shall be a
community redevelopment covenant which shall run with each
Developer Lot.
(b) The Developer further covenants and agrees
for itself, its successors and assigns that each of the
Developer Lots shall be improved, developed and used in
accordance with the Scope of Development. Developer
covenants to develop and use the Developer Lots in
conformity with all applicable laws.
(c)
the Developer
pending final
Developer shall not lease or rent any of
Lots, or any New Home constructed thereon,
sale to a Qualified Homebuyer."
Interested persons may contact the Agency (Attention
Executive Director) by telephone at (909) 663-1044, during
regular business hours for additional information relating to
the Old Towne Single Family Residential Acquisition and
Construction Grant Funding Agreement.
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Exh . "B" - 3
CDC/2003-7
This Notice of Agreement Relating to Real Property has been
executed by the parties as set forth below.
DEVELOPER
Creative Housing Solutions,
a California non-profit public
benefit corporation
Date:
By:
By:
AGENCY
Redevelopment Agency of the
City of San Bernardino
Date:
By:
Executive Director
APPROVED AS TO FORM:
Agency Special Counsel
[NOTARY JURATS ATTACHED]
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Exh. "B" - 4
CDC/2003-7
EXHIBIT "C"
Project Description/Scope of Development
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Exh. "C" - 1
CDC/2003-7
EXHIBIT "e"
Project Description/Scope of Development
Creative Housing Solutions
Old Town Project Area
Creative Housing Solutions (CHS), a non-profit housing corporation, will acquire
or has acquired sixteen (16) vacant parcels in the Old Town Project Area of the
City of San Bernardino (see attached map).
The City of San Bernardino Redevelopment Agency (Agency) and CHS are
negotiating an agreement with the City of San Bernardino Unified School District
(District) on the acquisition and relocation of up to fourteen (14) homes from the
Jones Elementary School Site (see attached map).
CHS and the Agency agree that CHS will cause the School District homes to be
relocated, rehabilitated and sold to qualified homebuyers.
CHS will build a new single family home on those parcels that do not receive a
School District home.
CDC/2003-7
EXHIBIT "0"
Schedule of Performance
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Exh. "0" -1
CDC/2003-7
EXHIBIT "0"
SCHEDULE OF PERFORMANCE
Creative Housing Solutions
Old Town Project Area
1 Within 10 days following Agency governing
board approval of Agreement
2 Within 90 days following the Effective Date of Submit architectural and engineering plans to
this build a minimum of two new SFD houses
3 Within 90 days following the availability of the Inspect and submit final list of School District
School District Houses Houses with attached
4 (Scenario 1: 10 or more "School District
Homes")
Within 18 months effective date
(Scenario 2: Less than 10 "School District
Homes)
Within 18 months effective date
Within 30 months following effective date
5 Within 60 days of the completion of the
Pro'ect
Submit architectural and engineering plans to
build new SFD houses on any remaining lots.
A project pro-forma shall be submitted to the
"New SFD Structures" and "Restored Homes"
must be ready for occupancy
"Restored Homes" must be ready for
occupancy
"New SFD Structures" must be ready for
Developer shall submit to the Agency its
written verification of Final Costs
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EXHIBIT "E"
Form of Section 33334.3 Covenant
Exh. "E" - 1
CDC/2003-7
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
Redevelopment Agency of the City of San Bernardino
201 North "E" Street, Suite 301
San Bernardino, CA 92401
Attn: Executive Director
(Space Above Line Reserved For Use By Recorder)
RECORDATION OF THIS
INSTRUMENT IS EXEMPT FROM ALL
FEES AND TAXES
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
COMMUNITY REDEVELOPMENT HOUSING
AFFORDABILITY COVENANTS AND RESTRICTIONS
Dated as of
, 200
Old Towne Single Family
Residential Acquisition and Construction
Grant Funding Agreement
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Exh. "E" - 2
CDC/2003-7
REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
COMMUNITY REDEVELOPMENT HOUSING
AFFORDABILITY COVENANTS AND RESTRICTIONS
(Old Towne Single Family Acquisition and
Construction Grant Funding Aqreement)
THIS REDEVELOPMENT AGENCY OF THE CITY OF SAN BERNARDINO
COMMUNITY REDEVELOPMENT HOUSING AFFORDABILITY COVENANTS AND
RESTRICTIONS (the "Section 33334.3 Covenant") is made and
entered into as of 200_, by and among
Creative Housing Solutions, a California non-profit public
benefit corporation (the Developer"), the REDEVELOPMENT AGENCY
OF THE CITY OF SAN BERNARDINO, a body corporate and politic (the
"Agency"), and
(the "Qualified Homebuyer"), and this Section 33334.3 Covenant
relates to the following facts set forth in Recitals.
-- RECITALS --
A. The Qualified Homebuyer proposes to acquire a single
family residence (the "New Home"), located within the City of
San Bernardino (the "City"), from the Developer, to be owned and
occupied by the Qualified Homebuyer as their principal
residence. The legal description of the New Home is attached
hereto as Exhibit "A" and incorporated herein by this reference.
B. The Agency has used and applied certain affordable
housing development funds from the Low-and Moderate-Income
Housing Funds of several different redevelopment project areas,
to make the New Home available for acquisition by the Qualified
Homebuyer from the Developer subject to the terms and conditions
of the Community Redevelopment Law found at Health and Safety
Code Section 33000, et seg. (the "Act") and this Section 33334.3
Covenant; and
C. The Act mandates that the acquisition, use and
occupancy of the New Home shall be regulated in certain respects
for the term as provided herein (the "Qualified Residence
period") in order to ensure that the New Home will be used and
occupied in accordance with the Act and the affordable single
family residential dwelling unit development goals and
objectives of the Agency.
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Exh. "E" - 3
CDC/2003-7
NOW, THEREFORE, IN CONSIDERATION OF THE MUTUAL COVENANTS
AND UNDERTAKINGS SET FORTH HEREIN, AND FOR OTHER GOOD AND
VALUABLE CONSIDERATION, THE RECEIPT AND SUFFICIENCY OF WHICH IS
HEREBY ACKNOWLEDGED, THE QUALIFIED HOMEBUYER, THE DEVELOPER AND
THE AGENCY DO HEREBY COVENANT AND AGREE FOR THEMSELVES, THEIR
SUCCESSORS AND ASSIGNS AS FOLLOWS:
Section 1. Definitions of Certain Terms. As used in this
Section 33334.3 Covenant, the following words and terms shall
have the meaning as provided in the Recitals or in this Section
1 unless the specific context of usage of a particular word or
term may otherwise require:
Adjusted Family Income. The words "Adjusted Family Income"
mean the anticipated total annual income (adjusted for
family size) of each individual or family residing or
treated as residing in the New Home as calculated in
accordance with Treasury Regulation 1.167 (k) - 3b) (3) under
the Code, as adjusted, based upon family size in accordance
with the household income adjustment factors adjusted and
amended from time to time, pursuant to Section 8 of the
United States Housing Act of 1937, as amended.
Affordable Housing Cost. The words "Affordable Housing
Cost" shall have the meaning as set forth in Health and
Safety Code Section 50052.5, as this section may hereafter
be amended from time-to-time by the State of California. A
Qualified Homebuyer and/or the Successor-In-Interest of
such Qualified Homebuyer, if any, shall pay no more than an
Affordable Housing Cost for the New Home as of the
applicable Delivery Date.
Agency Investment Reimbursement. The words "Agency
Investment Reimbursement" mean and refer to the sum of
money which may be payable to the Agency by the Qualified
Homebuyer if, during the Qualified Residence Period, the
Qualified Homebuyer sells, assigns, transfer or otherwise
hypothecates the New Home to any person who does not
satisfy the requirement of a permitted successor-in-
interest (in other words the Successor-In-Interest
designated by the Qualified Homebuyer is a person or
household whose Adj usted Family Income exceeds the income
level for a Moderate Income Household). The Agency
Investment Reimbursement, and the method or formula for
determining the amount, if any, as may be payable by the
Qualified Homebuyer to the Agency upon the resale of the
New Home, is more particularly described in Section 5 of
4/4/03 12:00 jrnm
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Exh. "E" - 4
CDC/2003-7
this Section 33334.3 Covenant. As of the Delivery Date,
the Agency has provided the Developer with the sum of
$12,500 as an affordable housing development assistance
contribution for the improvement of the New Home, and the
provisions of Section 5 of this Section 33334.3 Covenant
are included in satisfaction of the requirements of Health
and Safety Code Section 33334.3(f) (B).
Code. The word "Code" means the Internal Revenue Code of
1986, as amended, and any regulation, rulings or procedures
with respect thereto.
Delivery Date. The words "Delivery Date" mean the date of
delivery of title and possession of the New Home from the
Developer to the Qualified Homebuyer at the close of the
New Home Escrow. In the case of a Successor-In-Interest,
the words "Delivery Date" refers to the date on which such
Successor-In-Interest acquires the New Home from the
Qualified Homebuyer; provided however, that for the purpose
of establishing the termination date of the Qualified
Residence Period, the Delivery Date shall refer to the date
on which this Section 33334.3 Covenant is recorded.
Moderate-Income Household. The words "Moderate-Income
Household" mean persons and families whose income does not
exceed one hundred and twenty percent (120%) of the area
median income of the City adjusted for family size by the
State Department of Housing and Community Development in
accordance with adjustment factors adopted and amended from
time to time by the United States Department of Housing and
Urban Development pursuant to Section 8 of the United
States Housing Act of 1937, as amended, and Health and
Safety Code Section 50093, as this section may hereafter be
amended from time-to-time by the State of California.
New Home. The words "New Home" mean and refer to the
completed affordable single-family residential dwelling
unit (including the land and landscape improvements
thereon) as constructed and installed by the Developer and
sold to the Qualified Homebuyer.
New Home Escrow. The words "New Home Escrow" mean and
refer to the real estate conveyance transaction or escrow
by and between the Developer and the Qualified Homebuyer
(or later, by and between the Qualified Homebuyer and the
Successor-In-Interest) . The transfer of the New Home from
the Developer to the Qualified Homebuyer (or later, by and
4/4/03 12:00 jrnm
SB2003:7464.3
Exh. "E" - 5
CDC/2003-7
between the Qualified Homebuyer and the Successor-In-
Interest) shall be accomplished upon the close of the New
Home Escrow.
Notice of Agency Concurrence. The words ~Notice of Agency
Concurrence" mean and refer to the acknowledgment in
recordable form in which the Agency confirms that the
proposed Successor-In-Interest of the Qualified Homebuyer
satisfies all of the Adjusted Family Income and other
requirements of this Section 33334.3 Covenant for occupancy
of the New Home by the Successor-In-Interest at any time
during the Qualified Residence Period.
Qualified Homebuyer. The words ~Qualified Homebuyer" mean
the purchaser of the New Home from the Developer (e. g. :
all persons identified as having a property ownership
interest vested in the New Home as of the close of the New
Home Escrow). At the close of the New Home Escrow, the
Qualified Homebuyer shall: (i) have an annual Adjusted
Family Income which does not exceed the household income
qualification limits of a Moderate-Income Household: (ii)
shall be a first-time homebuyer, as this term is defined in
Health and Safety Code Section 50068.5 as this section may
hereafter be amended from time-to-time by the State of
California; and (iii)pay no more than an Affordable Housing
Cost for the New Home pursuant to the terms of the purchase
transaction for the New Home, including all sums payable
by the Qualified Homebuyer for its purchase money mortgage
financing, insurance, escrow and other fees and costs.
Qualified Residence Period.
Period" mean the period of
Date and ending on the date
after the Delivery Date.
The words ~Qualified Residence
time beginning on the Delivery
which is forty-five (45) years
Section 33334.3 Covenant. The words ~Section 33334.3
Covenant" mean these Redevelopment Agency of the City of
San Bernardino Community Redevelopment Housing
Affordability Covenants and Restrictions by and among the
Qualified Homebuyer, the Developer and the Agency
pertaining to the New Home.
Successor-In-Interest. The words ~Successor-In-Interest"
mean and refer to the person, family or household which may
acquire the New Home from the Qualified Homebuyer at any
time during the Qualified Residence Period by purchase,
assignment, transfer or otherwise and whose payments for
4/4/03 12:00 jrnm
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Exh. ~E" - 6
CDC/2003-7
the acquisition of the New Horne from the Qualified
Homebuyer do not exceed an amount which is an Affordable
Housing Cost for such Successor-In-Interest household. The
Successor-In-Interest does not need to be a ~First-Time
Homebuyer" but, such Successor-In-Interest shall have an
income level for the twelve (12) months prior to the date
on which the Successor-In-Interest acquires the New Horne
which does not exceed the maximum Adjusted Family Income
level for a Moderate-Income Household. Upon acquisition
of the New Horne the Successor-In-Interest shall be bound by
each of the covenants, conditions and restrictions of this
Section 33334.3 Covenant.
The titles and headings of the sections of this Section
33334.3 Covenant have been inserted for convenience of reference
only and are not to be considered a part hereof and shall not in
any way modify or restrict the meaning any of the terms or
provisions hereof.
Section 2. Acknowledgments
Qualified Homebuyer. The
acknowledges and represents to
Delivery Date:
and Representations
Qualified Homebuyer
the Agency that, as
of the
hereby
of the
(a) the total household income for the Qualified Homebuyer
does not exceed the maximum amount permitted as Adjusted Family
Income for a Moderate-Income Household, adjusted for family
size;
(b) the Qualified Homebuyer intends to promptly occupy the
New Horne after the Delivery Date as the principal place of
residence for a term of at least two (2) years following the
Delivery Date and the Qualified Homebuyer has not entered into
any arrangement and has no present intention to rent, sell,
transfer or assign the New Horne to any third party during the
Qualified Residence Period so as to frustrate the purpose of
this Section 33334.3 Covenant;
(c) the Qualified Homebuyer has no present intention to
lease or rent any room or sublet or rent a portion of the New
Horne to any relative of the Qualified Homebuyer or to any third
person at any time during the Qualified Residence Period;
(d)
following
interest,
the sum payable each month by the Qualified Homebuyer
the close of the New Horne Escrow as principal and
property taxes and, property casualty insurance for
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Exh. ~E" - 7
CDC/2003-7
the acquisition of the New Home does not exceed the Affordable
Housing Cost for the household;
(e) the Qualified Homebuyer agrees to provide the Agency
wi th the following items of information for inspection by the
Agency promptly upon written request of the Agency:
(i) State and federal income tax returns filed by
all persons who reside in the New Home for the
most three (3) recent tax years preceding the
close of the New Home Escrow for inspection of
such State and federal income tax returns;
(ii)
current wage, income
all person residing
close of the New Home
and salary statements
in the New Home at
Escrow;
for
the
(f) The Qualified Homebuyer has been informed by the
Developer that this Section 33334.3 Covenant imposes certain
restrictions on the use and occupancy of the New Home during the
term of this Section 33334.3 Covenant and that this Section
33334.3 Covenant imposes certain restrictions on the resale of
the New Home during the Qualified Residence Period. The
Qualified Homebuyer acknowledges and understands that these
restrictions shall be applicable to the New Home and to any
resale of the New Home from the Delivery Date to the end of the
forty-five (45) year Qualified Residence Period which is
, 204 .
(g) Each of the foregoing acknowledgements and
representations of the Qualified Homebuyer are true and correct.
Dated:
Initials of
Qualified Homebuyer
Section 3. Covenant of the Qualified Homebuyer to Maintain
Affordabili ty of the New Home During the Qualified Residence
Period and Covenant Relating to Sale or Transfer of the New Home
During the Qualified Residence Period to a Successor-In-
Interest.
(a) The Qualified Homebuyer for itself, its heirs,
successors and assigns, hereby covenants and agrees that during
the term of the Qualified Residence Period the New Home shall be
used and, occupied by the Qualified Homebuyer as its principal
residence, and that the New Home shall be reserved for sale, use
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8B2003:7464.3
Exh. "En - 8
CDC/2003-7
and occupancy by the Qualified Homebuyer and/or for another
Moderate-Income Household as a Successor-In-Interest at an
Affordable Housing Cost. The Qualified Homebuyer, for itself,
its heirs, successors and assigns, further covenants and agrees
that, during the Qualified Residence Period, the Agency shall
have the right and duty as provided in this Section 3 to verify
that each proposed Successor-In-Interest of the Qualified
Homebuyer in the New Home satisfies the income requirements and
Affordable Housing Cost limitations of a Moderate-Income
Household (based upon the Adjusted Family Income of each
household), and that the completion of any resale or transfer of
the New Home to a Successor-In-Interest shall be subject to the
recordation of the ~Notice of Agency Concurrence" as provided in
Section 3 (d) .
(b) The Qualified Homebuyer, for itself, its successors
and assigns, hereby covenants and agrees that during the term of
the Qualified Residence Period the Qualified Homebuyer shall not
sell, transfer or otherwise dispose of the New Home (or any
interest therein) to a Successor-In-Interest without first
giving written notice to the Agency and without first obtaining
the written concurrence of the Agency as provided herein. At
least forty-five (45) days prior to the date on which the
Qualified Homebuyer proposes to transfer title in the New Home
to a Successor-In-Interest, the Qualified Homebuyer shall send a
written notice to the Agency as provided in Section 17 of the
intention of the Qualified Homebuyer to sell the New Home to a
Successor-In-Interest which includes the following true and
correct information:
(i) name of the proposed Successor-In-Interest
(including the identity of all persons in the
household of the Successor-In-Interest, proposing
to reside in the New Home);
(ii) copies of State and federal income tax returns
for the Successor-In-Interest for the calendar
year preceding the year in which the notice of
intention to sell the New Home is given to the
Agency;
(iii) resale price of the New Home payable by the
Successor-In-Interest, including the terms of all
purchase money mortgage financing to be assumed,
provided or obtained by the Successor-In-
Interest, escrow costs and charges, real tor
broker fees and all other resale costs or charges
4/4/03 12:00 jrnm Exh. ~E" - 9
5B2003:7464.3
CDC/2003-7
payable by either the Qualified Homebuyer or the
Successor-In-Interest;
(iv) name address, and telephone number of the escrow
company which shall coordinate the transfer of
the New Home from the Qualified Homebuyer to the
Successor-In-Interest;
(v) appropriate mortgage credit references for the
Successor-In-Interest together with a written
authorization signed by the Successor-In-Interest
authorizing the Agency to contact each such
reference (for the purposes of this subparagraph
(v), appropriate mortgage credit reference may
include a true and correct and complete copy of
the mortgage loan application submitted by the
Successor-In-Interest to its proposed purchase
money mortgage lender); and
(vi) such other relevant information as the Agency may
reasonably request, as provided in Section 3(c).
(c) Within twenty (20) days following receipt of the
notice of intention and accompanying written information
described in Section 3(b), the Agency shall provide the
Qualified Homebuyer with either a preliminary confirmation of
approval or a preliminary rejection of approval in writing of
the income and household occupancy qualifications of the
Successor-In-Interest. The Agency shall not unreasonably
withhold, condition or delay approval or rejection of the
qualifications of the proposed Successor-In-Interest in
connection with any proposed sale of the New Home. In the
event that the Agency may request additional information
relating to the confirmation of the matters described in Section
3(b) with respect to a proposed Successor-In-Interest, the
Qualified Homebuyer shall provide such information to the Agency
as promptly as feasible.
(d) Upon its final confirmation of approval of the
Adjusted Family Income and Affordable Housing Cost eligibility
of the Successor-In-Interest to acquire the New Home, the Agency
shall deliver a written acknowledgment and approval of the
resale of the New Home to the Successor-In-Interest (e.g., the
Notice of Agency Concurrence) in recordable form to the escrow
holder referenced in Section 3(b) (iv) above, and thereafter the
Successor-In-Interest may acquire the New Home subject to the
satisfaction of the following conditions:
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8B2003:7464.3
Exh. "E" - 10
CDCj2003-7
(i) the income and household occupancy information
provided to the Agency shall be true and
correct, and the Notice of Agency Concurrence
executed by the Successor-In-Interest and the
Agency shall be recorded at the close of the
resale escrow;
(ii) the escrow holder shall have provided the
Agency with a copy of the customary form of the
final escrow closing statement of the Qualified
Homebuyer and the final escrow closing
statement for the Successor-In-Interest; and
(iii) the other conditions of the resale escrow as
established by the Qualified Homebuyer and
Successor-In-Interest shall have been
satisfied.
(e) The Qualified Homebuyer for itself, its successors and
assigns hereby covenants and agrees that during the Qualified
Residence Period the New Home shall not be leased, subleased, or
rented to any third person, except for a temporary period (not
to exceed 12 months) in the event of an emergency or other
unforeseen circumstance as may be expressly approved in writing
by the Agency subject to compliance during the temporary rental
period with the reasonable temporary rental occupancy conditions
required by the Agency. The Qualified Homebuyer shall submit a
written request to the Agency prior to the commencement of the
temporary occupancy, as practicable, but in any event within not
more than (60) days following the commencement of a temporary
rental occupancy of the New Home by a third party, which notice
to the Agency shall set forth the grounds on which the Qualified
Homebuyer believes an emergency or other unforeseen circumstance
has occurred and that a temporary rental occupancy in necessary.
Section 4. Main tenance Condition
Qualified Homebuyer, for itself, its
hereby covenants and agrees that:
of the New Home. The
successors and assigns,
(a) The exterior areas of the New Home which are subject
to public view (e.g.: all improvements, paving, walkways,
landscaping, and ornamentation) shall be maintained in good
repair and a neat, clean and orderly condition, ordinary wear
and tear excepted. In the event that at any time during the
term of the Qualified Residence Period, there is an occurrence
of an adverse condition on any area of the New Home which is
4/4/03 12:00 jrnm
SB2003:7464.3
Exh. "E" - 11
CDC/2003-7
subj ect to public view in contravention of the general
maintenance standard described above, (a "Maintenance
Deficiency") then the Agency shall notify the Qualified
Homebuyer in writing of the Maintenance Deficiency and give the
Qualified Homebuyer thirty (30) days from the date of such
notice to cure the Maintenance Deficiency as identified in the
notice. The words "Maintenance Deficiency" include without
limitation the following inadequate or non-confirming property
maintenance conditions and/or breaches of single family dwelling
residential property use restrictions:
failure to properly maintain the windows, structural
elements, and painted exterior surface areas of the
dwelling unit in a clean and presentable manner;
failure to keep the front and side yard areas of the
property free of accumulated debris, appliances,
inoperable motor vehicles or motor vehicle parts, or
free of storage of lumber, building materials or
equipment not regularly in use on the property;
failure to regularly mow lawn areas or permit grasses
planted in lawn areas to exceed six inches (6") in
height, or failure to otherwise maintain the
landscaping in a reasonable condition free of weeds
and debris;
parking of any commercial motor vehicle in excess of
7,000 pounds gross weight anywhere on the property, or
the parking of motor vehicles, boats, camper shells,
trailers, recreational vehicles and the like in any
side yard or on any other parts of the property which
are not covered by a paved and impermeable surface;
the use of the garage area of the dwelling unit for
purposes other than the parking of motor vehicles and
the storage of personal possessions and mechanical
equipment of persons residing in the New Home.
In the event the Qualified Homebuyer fails to cure or
commence and to diligently proceed to complete the cure of the
Maintenance Deficiency within thirty (30) days from the date of
notice to cure, the Agency may thereafter conduct a public
hearing following transmittal of written notice thereof to the
Qualified Homebuyer ten (10) days prior to the scheduled date of
such public hearing in order to verify whether a Maintenance
Deficiency exists and whether the Qualified Homebuyer has failed
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SB2003;7464.3
Exh. "E" - 12
CDC/2003-7
to comply with the provision of this Section 4(a). If, upon the
conclusion of a public hearing, the Agency makes a written
finding that a Maintenance Deficiency exists and that there
appears to be non-compliance with the general maintenance
standard, as described above, and that the Qualified Homebuyer
has failed to cure such Maintenance Deficiency, then in such
event the Agency shall have the right (in addition to any other
rights or powers then available to the Agency or the City of San
Bernardino) to enter the New Home (exterior areas only) upon ten
(10) days written notice to the Qualified Homebuyer and perform
all acts necessary to cure the Maintenance Deficiency, or the
Agency may take other action at law or equity the Agency may
then deem appropriate to accomplish the abatement of the
Maintenance Deficiency. Any sum expended by the Agency for the
abatement of a Maintenance Deficiency as authorized by this
Section 4(a) shall become a lien on the New Home. If the amount
of the lien is not paid within thirty (30) days after written
demand for payment by the Agency to the Qualified Homebuyer, the
Agency shall have the right to enforce the lien in the manner as
provided in Section 4(c).
(b) Graffiti which is visible from any public right-of-way
which is adjacent or contiguous to the New Home shall be removed
by the Qualified Homebuyer from any exterior surface of a
structure or improvement on the New Home by either painting over
the evidence of such vandalism with a paint which has been
color-matched to the surface on which the paint is applied, or
graffiti may be removed with solvents, detergents or water as
appropriate. In the event that graffiti is placed on the New
Home (exterior areas only) and such graffiti is visible from an
adjacent or contiguous public right-of-way and thereafter such
graffiti is not removed within 72 hours following the time of
its application; then in such event and without notice to the
Qualified Homebuyer, the Agency shall have the right to enter
the New Home and remove the graffiti. Notwithstanding any
provision of Section 4 (a) to the contrary, any sum expended by
the Agency for the removal of graffiti from the New Home as
authorized by this Section 4 (b) shall become a lien on the New
Home. If the amount of the lien is not paid within thirty (30)
days after written demand for payment by the Agency to the
Qualified Homebuyer, the Agency shall have the right to enforce
its lien in the manner as provided in Section 4(c).
(c) The parties hereto further mutually understand and
agree that the rights conferred upon the Agency under this
Section 4 expressly include the power to establish and enforce a
lien or other encumbrance against the New Home in the manner
4/4/03 12:00 jrnm
5B2003:7464.3
Exh. "Elf - 13
CDC/2003-7
provided under Civil Code Sections 2924, 2924b and 2924c in the
amount as reasonably necessary to restore the New Home to the
maintenance standard required under Section 4(a) or Section
4 (b), including the reasonable attorneys fees and costs of the
Agency associated with the abatement of the Maintenance
Deficiency or removal of graffiti and the collection of the
costs of the Agency in connection with such action. In any
legal proceeding for enforcing such a lien against the New Home,
the prevailing party shall be entitled to recover its attorneys'
fees and costs of suit. For the purposes of this Section 4, the
words "reasonable attorneys' fees and costs of the Agency" mean
and include the salaries and benefits payable to lawyers
employed by the Office of the City Attorney, allocated on an
hourly basis, who provide legal services to the Agency in
connection with the enforcement of this Section. The provisions
of this Section 4, shall be a covenant running with the land for
the Qualified Residence Period and shall be enforceable by the
Agency in its discretion, cumulative with any other rights or
powers granted by the Agency under applicable law. Nothing in
the foregoing provisions of this Section 4 shall be deemed to
preclude the Qualified Homebuyer from making any alterations,
additions, or other changes to any structure or improvement or
landscaping on the New Home, provided that such changes comply
with the zoning and development regulations of the City and
other applicable law.
Section 5. Protection of Aqency
Derived From the Low-and Moderate-Income
Home - Aqency Investment Reimbursement.
Investment of Moneys
Housing Fund in the New
(a) For the purpose of this Section 5, the following terms
shall have the meaning as provided below:
"Purchase Money Mortgage" means the original balance on the
Delivery Date of the New Home mortgage provided to the Qualified
Homebuyer by the conventional mortgage lender, plus the original
outstanding balance of the Agency MAP Loan, if any.
"Qualified Homebuyer Equity" means the downpayment amount in
cash paid by the Qualified Homebuyer for the New Home on the
Delivery Date (e.g.: the equity or "basis" as defined under the
Code, net of the Purchase Money Mortgage of the Qualified
Homebuyer in the New Home), plus the reduction, if any, of the
outstanding principal balance of the Purchase Money Mortgage
secured by the New Home through the date of the resale of the
New Home.
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5B2003:7464.3
Exh. "E" - 14
CDC/2003-7
"Resale Price" means the total consideration paid by the
Successor-In-Interest, including real estate broker fees and
commissions for the purchase of the New Home, but excluding
escrow fees and mortgage financing costs payable or otherwise
allocated to the Successor-In-Interest in connection with the
transfer of the New Home from the Qualified Homebuyer to the
Successor-In-Interest.
"Resale Profit" means the balance of the following calculation:
(Resale
Homebuyer
Profit.
Price)-(Purchase
Equity + Resale
Money Mortgage)-(Qualified
Cost Adjustment Factor)=Resale
A portion of the Resale Profit shall be payable to the Agency by
the Qualified Homebuyer in accordance with Section 5(b).
"Resale Cost Adjusbnent Factor" means one of the following sums
determined by reference to the number of years which have
elapsed between the Deli very Date and the date on which the
resale and transfer of the New Home to the Successor-In-Interest
occurs:
Da te of Resale of New Home
after the Delivery Date:
From the Delivery Date to the
5th anniversary after Delivery
Date
From and including the 5th
anni versary to the loth
anniversary after Delivery
Date
From and including the
anniversary to the end of
Qualified Residence Period
loth
the
Resale
Factor:
Cost
Adjusbnent
$0
$5,000.00
$10,000.00
(b) The Agency has used and applied certain moneys from
the Low-and Moderate-Income Housing Funds of the Agency to
assist with the development of the New Home. In the event that
the New Home may be sold, assigned, conveyed or otherwise
transferred by the Qualified Homebuyer during the term of the
Qualified Residence Period to a person or household whose
Adjusted Family Income exceeds the income level for a Moderate-
4/4/03 12:00 jrnm
5B2003:7464.3
Exh. "E" - 15
CDC/2003-7
Income Household, a portion of the Resale Price of the New Home
in excess of an adjusted sale price amount which the Qualified
Homebuyer paid on such resale date (e.g.: the "Resale Profit"
amount) shall be payable to the Agency as the Agency Investment
Reimbursement in accordance with Health and Safety Code Section
33334.3(f), and as provided herein. In the event that, at any
time during the Qualified Residence Period, the Qualified
Homebuyer (or any Successor-In-Interest) may sell, assign,
conveyor otherwise transfer the New Home to a person or
household whose Adjusted Family Income exceeds the income level
for a Moderate-Income Household, a portion of the Resale Profit
realized by the Qualified Homebuyer shall be payable to the
Agency as the "Agency Investment Reimbursement" in the amounts
as follows:
Date of Resale of New Home
After Delivery Date
From the Delivery
2~ anniversary
Delivery Date
Date to the
after the
From the 2nd anniversary to
the 10~ anniversary after the
Delivery Date
From the 10th anniversary to
end the 20th anniversary after
the Delivery Date
From the 20th anniversary to
the 30th anniversary after the
Delivery Date
30th '
From the annlversary
after the Delivery Date to
the end of the Qualified
Residence Period
Portion of Resale Profit
Payable to Aqency from Resale
of New Home
100% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
75% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
50% of Resale Profit is
payable to Agency as Agency
Investment Reimbursement
Resale Profit is
the Agency as
Investment
25% of the
payable to
Agency
Reimbursement
Resale Profit is
the Agency as
Investment
10% of the
payable to
Agency
Reimbursement
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Exh. "E" - 16
CDC/2003-7
(c) Three (3) examples of the application of the formula
described above as "Resale Profit" to determine the amount of
the Agency Investment Reimbursement payable on the date of a
hypothetical resale of the New Home are presented as follows:
EXAMPLE A: Resale to a purchaser whose Adjusted Family Income
exceeds the income level of a Moderate Income Household or to a
purchaser who will not live in the New Home as a principal
residence:
Assume that on the Delivery Date the sales price of the New
Home payable by the Qualified Homebuyer was $156,000 and
that the resale occurs on the 7th anniversary following the
Delivery Date;
Assume the Resale Price of the New Home is $185,000; and
Assume that Qualified Homebuyer Equity as of the date of
the resale is $24,000:
EXAMPLE A CALCULATION OF RESALE
($19,0003+$5,0004)=$24,0005:Resale
BELOW) .
PROFIT: $185,0001-$137,0002-
Profit (SEE ALSO FOOTNOTES,
The Agency Investment Reimbursement amount under Example A
payable at close of the resale escrow in this hypothetical
example is $12,500 (e.g., 75% of $24,000 is more than the
$12,500 Agency Investment Reimbursement so in this case the
lower figure of $12,500 is payable to the Agency).
EXAMPLE B: Resale to a purchaser whose Adjusted Family Income
DOES NOT exceed the income level of a Moderate Income Household
The Resale Price of the New Home to the Successor-In-Interest in
Example A.
2 The Purchase Money Mortgage amount ($130,000 conventional mortgage
plus $7,000 Agency MAP) of the New Home as of the Delivery Date.
3 The Qualified Homebuyer Equity in the New Home ($19,000 cash down
payment plus a $5,000 reduction of outstanding principal balance on the
Purchase Money Mortgage loans through the time of resale).
The Resale Cost Adjustment Factor in the 7th year.
The Resale Profit of $24,000 is subject to a 75% allocation to pay the
Agency Investment Reimbursement, or $12,500 payable to the Agency (as
provided in Section 5 (b)) . The seller of this New Home could retain only
$11,500 of the "Resale Profit" in this example.
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8B2003:7464.3
Exh. "E" - 17
CDCj2003-7
and who will reside in the New Home as their principal
residence:
Assume same facts as in Example A and that the Successor-
In-Interest also pays no more than an Affordable Housing
Cost for the New Home at a resale price of $185,000 on the
7th anniversary date following the Delivery Date;
EXHIBIT B CALCULATION OF RESALE PROFIT:
No Agency Reimbursement is payable to Agency as the Successor-
In-Interest is a Moderate Income Household in this hypothetical
sale and pays to the Qualified Homebuyer no more than Affordable
Housing Cost for its purchase of the New Home. In this example,
the seller of the New Home could retail the full amount of the
Resale Profit or $24,000. Such Successor-In-Interest's
"Qualified Homebuyer Equity" will be adjusted to reflect that
buyer's new mortgage and equity basis in the New Home for
purposes of determining whether an Agency Reimbursement amount
may be payable by such Successor-In-Interest in any future
resale transaction during the remaining term of the Qualified
Residence Period.
(d) The sole source of funds of the Qualified Homebuyer to
pay the Agency the Agency Reimbursement Agreement, shall be from
the Resale Profit amount realized at the time of resale to a
purchaser whose Adjusted Family Income exceeds the income level
of a Moderate Income Household. In the event that the
applicable amount of the Agency Investment Reimbursement is paid
to the Agency at the time of resale of the New Home to a person
or household which does not qualify as a Successor-In-Interest,
the Agency shall cause to be recorded concurrently with the
resale of the New Home to such person, a notice of release of
the following provisions of this Section 33334.3 Covenant:
Section 2,
Section 3,
Section 5
Section 7
Section 6. Acknowledgment of Subordination of the
Provisions of Section 3, Section 5 and Section 7 (b) of this
Section 33334.3 Covenant to the Mortgage Security Interest of
the First Mortgage Lender.
Concurrently upon the execution and recordation of this
Section 33334.3 Covenant the Qualified Homebuyer shall obtain
certain purchase money mortgage financing for the acquisition of
the New Home from (the "First Mortgage
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8B2003:7464.3
Exh. "E" - 18
CDC/2003-7
Lender"). As of the Delivery Date, the Qualified Homebuyer has
provided the Agency with a true and correct copy of the loan
agreement by and between the First Mortgage Lender and the
Qualified Homebuyer.
As a condition to providing its mortgage loan to the
Qualified Homebuyer, the First Mortgage Lender requires the
Agency to agree that the provisions of Section 3, Section 5 and
Section 7 (b) of this Section 33334.3 Covenant shall be junior
and subordinate to the security interest of the First Mortgage
Lender of even date herewith, in the New Horne.
The Agency hereby acknowledges and agrees that the
provisions of Section 3, Section 5 and Section 7 (b) of this
Section 33334.3 Covenant are subordinate and junior to the
security interest of the First Mortgage Lender of even date
herewith in the New Horne. No breach or default by the Qualified
Homebuyer of any provision of Section 3 and/or Section 7 (b) of
this Section 33334.3 Covenant, nor the exercise by the Agency of
any remedy it may have against the Qualified Homebuyer in the
event of such a breach or default shall affect or render invalid
the lien of the First Mortgage Lender in the New Horne. In the
event that the First Mortgage Lender (or its assignee) may
foreclose the lien of the First Mortgage Lender in the New Horne
through trustee sale, judicial foreclosure or by acceptance of
deed in lieu of foreclosure, the First Mortgage Lender, and its
good faith purchasers for value, shall receive title in the New
Horne free and clear of the provisions of Section 3, Section 5
and Section 7(b) of this Section 33334.3 Covenant.
Section 7. Foreclosure of Purchase Money Mortgage Loan and
Agency Right of First Refusal.
(a) During the Qualified Residence Period the Agency shall
have the right (but not the obligation) to bid on the purchase
of any mortgage loan lien secured by the New Horne at the time of
any trustee foreclosure sale or any judicial foreclosure sale.
(b) During the Qualified Residence Period the Agency shall
have the right of first refusal to purchase the New Horne from
the Qualified Homebuyer on the same terms which the Qualified
Homebuyer may propose to sell the New Horne to a third party who
does not qualify as a Successor-In-Interest. The Agency must
exercise such a right of first refusal within thirty (30) days
following written notification of the intention of the Qualified
Homebuyer to resell the New Horne to such a third party, and such
notice shall be accompanied with a true and complete copy of the
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5B2003:7464.3
Exh. "E" - 19
CDC/2003-7
written sale agreement between the Qualified Homebuyer and such
third party. If the Agency accepts the offer in writing within
such time period the Agency shall be bound to complete the
purchase of the New Home in accordance with the written sale
agreement of such third party. Thereafter the Agency shall pay
the "resale price" to the Qualified Homebuyer and close an
escrow for the transfer of the New Home to the Agency within
sixty (60) days following written notification of the intention
of the Qualified Homebuyer to resell the New House.
Section 8. Covenants to Run With the Land. The Developer,
the Agency and the Qualified Homebuyer hereby declare their
specific intent that the covenants, reservations and
restrictions set forth herein are part of a common plan for the
development of affordable single family housing improvements in
the Northwest Redevelopment Project and that each shall be
deemed covenants running with the land and shall pass to and be
binding upon the New Home and each Successor-In-Interest of the
Qualified Homebuyer in the New Home for the term provided in
Section 10. The Qualified Homebuyer hereby expressly assumes the
duty and obligation to perform each of the covenants and to
honor each of the reservations and restrictions set forth in
this Section 33334.3 Covenant. Each and every contract, deed
or other instrument hereafter executed covering or conveying the
New Home or any interest therein shall conclusively be held to
have been executed, delivered and accepted subject to such
covenants, reservations, and restrictions, regardless of whether
such covenants, reservations and restrictions are set forth in
such contract, deed or other instrument.
Section 9. Burden and Benefit. The Developer, the Agency
and the Qualified Homebuyer hereby declare their understanding
and intent that the burden of the covenants set forth herein
touch and concern the land in that the Qualified Homebuyer' s
legal interest in the New Home is affected by the affordable
single family dwelling use and occupancy covenants hereunder.
The Agency and the Qualified Homebuyer hereby further declare
their understanding and intent that the benefit of such
covenants touch and concern the land by enhancing and increasing
the enjoyment and use of the New Home by the intended
beneficiaries of such covenants, reservations and restrictions,
and by furthering the public purposes for which moneys from the
Low-and Moderate Income Housing Fund of the Northwest
Redevelopment proj ect were used and applied by the Agency in
order to make the New Home available for acquisition and
occupancy by the Qualified Homebuyer.
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SB2003:7464.3
Exh. "E" - 20
CDC/2003-7
Section 10. Term. This Section 33334.3 Covenant shall
apply to the New Home and the Qualified Homebuyer and to each
Successor-In-Interest as of the Delivery Date for the Qualified
Residence Period -- e. g.: this Section 33334.3 Covenant shall
remain in full force and effect for forty five (45) years after
the Delivery Date, except as to certain sections hereof as
provided in Section 5(d). Any provision or section hereof, may
be terminated after the Delivery Date upon agreement by the
Agency and the Qualified Homebuyer (or the Successor-In-Interest
in the New Home), if there shall have been provided to the
Agency an opinion of special legal counsel that such a
termination under the terms and conditions approved by the
Agency in its reasonable discretion will not adversely affect
the Agency or the investment of Low-and Moderate-Income Housing
Funds of the Agency in the New Home.
Section 11. Breach and Default and Enforcement.
(a) Failure or delay by the Qualified Homebuyer to honor
or perform any material term or provision of this Section
33334.3 Covenant shall constitute a breach under this Agreement;
provided however, that if the Qualified Homebuyer commences to
cure, correct or remedy the alleged breach within thirty (30)
calendar days after the date of written notice specifying such
breach and shall diligently complete such cure, correction or
remedy, the Qualified Homebuyer shall not be deemed to be in
default hereunder.
The Agency shall give the Qualified Homebuyer written
notice of breach specifying the alleged breach which if uncured
by the Qualified Homebuyer within thirty (30) calendar days,
shall be deemed to be an event of default. Delay in giving such
notice shall not constitute a waiver of any breach or event of
defaul t nor shall it change the time of breach or event of
defaul t; provided, however, the Agency shall not exercise any
remedy for an event of default hereunder without first
delivering the written notice of breach as specified in this
Section 11.
Except with respect to rights and remedies expressly
declared to be exclusive in this Section 33334.3 Covenant, the
rights and remedies of the Agency are cumulative with any other
right or power of the Agency or the City or other applicable
law, and the exercise of one or more of such rights or remedies
shall not preclude the exercise by the Agency at the same or
different times, of any other right or remedy for the same
breach or event of default.
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5B2003:7464.3
Exh. "E" - 21
CDC/2003-7
In the event that a breach of the Qualified Homebuyer may
remain incurred for more than thirty (30) calendar days
following written notice, as provided above, an event of default
shall be deemed to have occurred. In addition to the remedial
provisions of Section 4 as related to a Maintenance Deficiency
at the New Home, upon the occurrence of any event of default the
Agency shall be entitled to seek any appropriate remedy or
damages by initiating legal proceedings as follows:
(i) by mandamus or other suit, action or proceeding
at law or in equity, to require the Qualified
Homebuyer to perform its obligations and
covenants hereunder, or enjoin any acts or
things which may be unlawful or in violation of
the rights of the Agency; or
(ii) by other action at law or in equity as
necessary or convenient to enforce the
obligations, covenants and agreements of the
Qualified Homebuyer to the Agency.
(b) No third party shall have any right or
enforce any provision of this Section 33334.3 Covenant
of the Agency or to compel the Agency to enforce any
of this Section 33334.3 Covenant against the Qualified
on the New Home.
power to
on behalf
provision
Homebuyer
Section 12. Governinq Law. This Section 33334.3 Covenant
shall be governed by the laws of the State of California.
Section 13. Amendment. This Section 33334.3 Covenant may
be amended after the Delivery Date only by a written instrument
executed by the Qualified Homebuyer (or the Successor-In-
Interest, as applicable) and by the Agency. The Developer shall
have not any right or power to approve any such amendment to
this Section 33334.3 Covenant, and the execution by the
Developer of any such amendment after the delivery date shall
not be required.
Section 14. Attorney's Fees. In the event that the
Agency brings an action to enforce any condition or covenant,
representation or warranty in this Section 33334.3 Covenant or
otherwise arising out of this Section 33334.3 Covenant, the
prevailing party in such action shall be entitled to recover
from the other party its reasonable attorneys' fees to be fixed
by the court in which a judgment is entered, as well as the
4/4/03 12:00 jrnm
SB2003:7464.3
Exh. "E" - 22
CDC/2003-7
costs of such suit. For the purposes of this Section, the words
"reasonable attorneys' fees" in the case of the Agency shall
mean and include the salaries and benefits payable to lawyers
employed by the Office of City Attorney, allocated on an hourly
basis, who provide legal services to the Agency in connection
with the enforcement of this Agreement.
Section 15. Severability. If any provision of this
Section 33334.3 Covenant shall be declared invalid, inoperative
or unenforceable by a final judgment or decree of a court of
competent jurisdiction such invalidity or unenforceability of
such provision shall not affect the remaining parts of this
Section 33334.3 Covenant which are hereby declared by the
parties to be severable from any other part which is found by a
court to be invalid or unenforceable.
Section 16. Time is of the Essence. For each provision
of this Section 33334.3 Covenant which states a specific amount
of time within which the requirements thereof are to be
satisfied, time shall be deemed to be of the essence.
Section 17. Notice. Any notice required to be given
under this Section 33334.3 Covenant shall be given by the Agency
or by the Qualified Homebuyer, as applicable, by personal
deli very or by First Class United States mail at the addresses
specified below or at such other address as may be specified in
writing by the parties hereto:
If to the Agency:
Executive Director
Redevelopment Agency of the
City of San Bernardino
201 North "E" Street, Ste 301
San Bernardino, CA 92401
Phone: (909) 384-5081
If to the
Qualified Homebuyer:
Attn:
Phone:
Notice shall be deemed given five (5) calendar
date of mailing to the party, or, if personally
received by the Executive Director of the
Qualified Homebuyer, as applicable.
days after the
delivered, when
Agency or the
4/4/03 12:00 jmm
SB2003:7464.3
Exh. "E" - 23
CDCj2003-7
IN WITNESS WHEREOF, the Developer, the Qualified Homebuyer
and the Agency have caused this Section 33334.3 Covenant to be
signed, acknowledged and attested on their behalf by duly
authorized representatives in counterpart original copies which
shall upon execution by all of the parties be deemed to be one
original document. The recordation of this Section 33334.3
Covenant is authorized under Health and Safety Code Section
33334.3(g) .
QUALIFIED HOMEBUYER
Dated:
By:
By:
DEVELOPER
Creative Housing Solutions,
a California non-profit public
benefit corporation
Dated:
By:
By:
AGENCY
Redevelopment Agency of the
City of San Bernardino
Dated:
By:
Executive Director
[ALL SIGNATURES MUST BE NOTARIZED]
Approved as to Form:
By:
Agency Special Counsel
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SB2003:7464.3
Exh. "E" - 24
4/4/03 12:00 jrnm
3B2003:7464.3
CDC/2003-7
EXHIBIT "A"
Legal Description of the New Home
Exh. "E" - 25
CDC/2003-7
EXHIBIT "F"
School District Houses
4/4/03 12:00 jrnm
SB2003:7464.3
Exh. "F" - 1
CDC/2003-7
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4/4/03 12:00 jmm
SB2003:7464.3
CDC/2003-7
EXHIBIT "G"
Form of Property Owner Consent to
Landscape Assessment District Formation
Exh. "G" - 1
CDC/2003-7
FORM OF EXHIBIT "G"
Recording Requested By
And When Recorded Mail To:
City of San Bernardino
Department of Public Works
Attn: City Engineer
301 North "D" Street
San Bernardino, California 92401
(Space Above Line For Use By Recorder)
AGREEMENT AND PETITION OF PROPERTY
OWNER REQUESTING FORMATION OF
LANDSCAPE MAINTENANCE DISTRICT AND
CONSENT TO THE LEVY OF SPECIAL
ASSESSMENTS THEREUNDER
(Central City North Redevelopment Project)
THIS AGREEMENT AND PETITION OF PROPERTY OWNER REQUESTING
FORMATION OF LANDSCAPE MAINTENANCE DISTRICT AND CONSENT TO THE LEVY
OF SPECIAL ASSESSMENTS THEREUNDER (the "Petition and Consent") is dated as of
,2003, and evidences the request of the owner of the property (the "Property") more
fully described in Exhibit "A" attached hereto, for the Mayor and Common Council of the City of
San Bernardino (the "City"), to proceed without further notice to Creative Housing Solutions, Inc., a
California non-profit corporation (the "Owner") or to its successors and assigns, to form a special
assessment district which may include the Property and other lands for the purposes set forth below
in this Petition and Consent.
CREATIVE HOUSING SOLUTIONS, INC., AS THE OWNER OF THE PROPERTY
HEREBY SUBMITS THIS PETITION AND CONSENT TO THE CITY AND DECLARES
COVENANTS AND AGREES AS FOLLOWS:
Section 1. As used in this Petition and Consent, the words "Assessment District Area"
means and refers to the portion of the Property which has been dedicated for public street and
sidewalk purposes.
Section 2. This Petition and Consent is delivered to the City in accordance with the
provisions of City of San Bernardino Municipal Code Section 12.90.040 C.5., and other applicable
law including without limitation Streets and Highways Code Section 22500 et seq., and in
satisfaction of certain conditions set forth in an agreement by and between the Owner and the
4/4103 1:45 jmm
SB2003:12287.1
CDCj2003-7
Redevelopment Agency of the City of San Bernardino entitled "Old Towne Single Family
Residential Acquisition and Construction Grant Funding Agreement" entered into as of March 3,
2003, as relates to the formation (or annexation into) a landscape maintenance assessment district at
the discretion of the City which includes the Property for the purpose of providing for the
maintenance and servicing of public landscaping improvements within the Assessment District Area.
Section 3. (a) The Owner for itself and its successors and assigns hereby requests the
City to initiate proceedings to form a landscape maintenance assessment district (or to cause the
Property to be annexed into such a landscape maintenance assessment district) for the purposes set
forth in Section 3(b) below (the "Landscape District") for the maintenance and servicing of public
landscaping improvements on the portion of the Property situated within the Assessment District
Area. The Landscape District may only include the Assessment District Area for the purposes set
forth in Section 3(b), below and the Property for the purposes of the levy and collection of the
assessment as may hereafter be ordered by the City under Section 4.
(b) Within the Assessment District Area, the Landscape District and the special
assessments as may hereafter be levied by the City each fiscal year may provide for the following
improvements:
(i) the maintenance and servicing by the City of any planting of landscaping within the
Assessment District Area approved by the City and installed within the Assessment
District Area by the owner ofthe Property or by the City. As used herein, the words
"maintenance and servicing" mean and refer to the furnishing of services and
materials for the ordinary and usual maintenance, operation of the landscaping
installed by the owner of the Property or the City in the Assessment District Area
including providing for the growth, health, cultivation, irrigation, trimming, spraying,
fertilizing or treating for disease or injury, the removal of trimmings, rubbish, debris
and other solid waste and the cleaning, sandblasting and painting of walls and other
improvements to remove or cover graffiti; and
(ii) incidental costs associated with the maintenance and servlcmg described in
subparagraph (i), above, including the costs of preparation of engineering reports and
the collection of the assessment.
(c) The Owner for itself and its successors and assigns hereby waives its right to protest
the formation of the Landscape District and further waives any right to object to the performance by
the City of any of the maintenance or furnishing of services described in Section 3(b) under City
Municipal Code Section 12.90 et seq. or other applicable law. The Owner for itself and its
successors and assigns hereby waives any requirement for giving or receipt of notice from the City
with respect to the formation of the Landscape District or, except as provided in Section 4(ii), the
ordering or performance of any maintenance or furnishing of services in the Assessment District
Area described in Section 3(b).
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S82003:12287.1
2
CDC/2003-7
Section 4. The Owner for itself and its successors and assigns hereby waives right to
protest the amount of an assessment which may hereafter be levied by the City on the Property for
the Landscape District under City Municipal Code Section 12.90 et seq. or other applicable law
including without limitation Streets and Highways Code Section 22620, et seq., in any year for the
performance by the City of any maintenance or services in the Assessment District Area, and hereby
consents to the levy of a special assessment on the Property therefore, subject to the following
conditions:
(i) the City shall have completed the formation of the Landscape District as evidenced
by the recordation of an assessment district boundary map which conforms with this
Petition and Consent and the requirements of Streets and Highways Code Section
3111 or filed a resolution confirming the formation of such Landscape District and
assessment under other applicable law, including without limitation Streets and
Highways Code Section 22641 ;
(ii) the owner of the Property shall have failed to perform the maintenance or furnishing
of services described in Section 3(b) within the Assessment District Areas or any
portion thereof following at least sixty (60) days prior written notice of the City
ordering the owner of the Property to perform the maintenance or furnishing of
services described in such notice; and
(iii) the amount of the assessment levied by the City for maintenance or furnishing of
services it may perform under subparagraph (ii), above, shall not exceed the lesser of:
(A) the actual costs paid by the City for the performance of such maintenance and
servicing, plus a reasonable administrative charge; or: (B) One Dollar and Ten Cents
($1.10) multiplied by the number of square feet within the Assessment District Area
on which the City performed the maintenance or furnishing of services described in
the notice, adjusted as of July 1 of each year following the recordation of this Petition
and Consent by an amount equal to the change (if any) over the twelve (12) months
preceding the last such adjustment in the Consumer Price Index (all items) all urban
consumers (with a base 1982 = 100) for the San Bernardino-Riverside metropolitan
areas as published by the United States Department of Labor, Business of Labor
Statistics.
Section 5. The Owner for itselfand its successors and assigns hereby acknowledges and
consents to the collection of any special assessments as may hereafter be levied by the City under
Section 4, at the same time and in the same manner as county property taxes are collected and all the
laws providing for the collection and enforcement of county property taxes shall apply to the
collection and enforcement of any such assessments
Section 6. This Petition and Consent shall not be withdrawn, modified or amended by the
owner of the Property during its term without the prior written consent of the City, which consent the
City may grant or withhold in its sole and absolute discretion and such consent of the City shall be
evidenced by an instrument in recordable form.
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SB2003:12287.1
3
CDC/2003-7
Section 7. The recordation of this Petition and Consent is authorized under Health and
Safety Code Section 33336(b) in order to provide for the implementation ofthe redevelopment plan
for the Central City North Redevelopment Project. This Petition and Consent shall have no further
force or effect on the tenth (10th) anniversary following its recordation in the event that prior to such
date the City may have failed to initiate proceedings for the formation of the Assessment District
Area as evidenced by a notice of assessment recorded against the Property in the manner authorized
by Streets and Highways Code Section 3111 or other applicable law.
THIS PETITION AND CONSENT is executed by the authorized officers of the Owner on
the date indicated next to the signatures of each of them.
OWNER
Creative Housing Solutions, Inc., a California
non-profit corporation
Date:
,2003
By:
Date:
,2003
By:
[NOTARY JURAT ATTACHED]
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SB2003:12287.1
4