HomeMy WebLinkAbout2010/03/23 Item 3
CITY COUNCIL
AGENDA STATEMENT
~f:. CITY OF
- - CHULA VISTA
ITEM TITLE:
SUBMITTED BY:
REVIEWED BY:
MARCH 23, 2010, Item "3
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING AN AGREEMENT BETWEEN
THE CITY OF CHULA VISTA AND COMMUNITY
HOUSINGWORKS FOR THE IMPLEMENT A TION OF THE
DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT NEIGHBORHOOD ST ABILIZA TION
PROGRAM (NSP); AUTHORIZING THE CITY MANAGER
TO EXECUTE THE AGREEMENT AND ANY NECESSARY
DOCUMENTS TO OBLIGATE NSP FUNDS; AND
AUTHORIZING THE CITY MANAGER TO REALLOCATE
UNOBLIGATED NSP FUNDS WITH EXISTING NSP NON-
PROFIT CONTRACTORS/DEVELOPERS, INCLUDING THE
SAN DIEGO COMMUNITY HOUSING CORPORATION, TO
ACQUIRE AND REHABILITATE PROPERTIES UNDER THE
NSPPROGRAM (It
DEPUTY CITY MANAGE~ DEVELOPMENT SERVICES
DIRECTOR
CITY MANAGER r
4/5THS VOTE: YES D NO 0
SUMMARY
On September 1, 2009, Council approved an amendment of the Fiscal Year 2008/2009
Action Plan for Neighborhood Stabilization Plan (NSP) funds to add a NSP eligible use to
purchase and rehabilitate homes that have been abandoned or foreclosed upon, and to sell
these properties. Staff recommends that Council approve entering into a contract with
Community HousingWorks to conduct these services, authorize the City Manager to
execute the Agreement with Community HousingWorks and any necessary documents to
obligate NSP funds, and further authorize the City Manager to reallocate unobligated funds
between NSP contractors as necessary.
ENVIRONMENTAL REVIEW
The Environmental Review Coordinator has reviewed the proposed action for compliance
with the National Environmental Policy Act (NEPA) due to the use of Federal funds and
has determined that pursuant to Section 58.30 (b), Subpart D, Title 24 of the Code of
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March 23,2010, Item ::3
Page 20f3
Federal Regulations, further review and environmental determination as appropriate, will
be required for each project as it is identified. Thus, no further NEP A environmental
review or documentation is necessary at this time.
RECOMMENDATION
Council adopt the resolution.
BOARDS/COMMISSION RECOMMENDATION
None.
DISCUSSION
BACKGROUND
On March 3, 2009, Council approved Neighborhood Stabilization Program (NSP) funds
that included a portion ($1,547,064) to provide soft second financial assistance for low-
and moderate-income first-time homebuyers to purchase abandoned and foreclosed
properties. Since implementation the City has pre-committed funds to nearly 30
households for financial assistance. However as of December 31, 2009, only one
household has been successful in locating and purchasing a property under the program,
expending $41,500 in funds.
In anticipation of these difficult market conditions, on September 1, 2009 Council
approved an amendment of the Fiscal Year 2008/2009 Action Plan for Neighborhood
Stabilization Plan (NSP) funds to add a NSP eligible use to purchase and rehabilitate
homes that have been abandoned or foreclosed upon, and to sell such homes and
properties. At that time, staff indicated that if after December 2009 funds were still
available for homebuyer activities, a portion of these funds would be used to partner with a
NSP non-profit contractor/developer, Community HousingWorks or San Diego
Community Housing Corporation, to acquire and rehabilitate NSP eligible properties for
the purpose of reselling to qualified NSP participants. This additional activity will give
first-time homebuyers the flexibility to locate a property on their own or purchase a
property through the NSP resale program.
Staff is bringing forward the selected partner agency for this activity for City Council
consideration and approval and further asking for authorization for the City Manager to
reallocate unobligated NSP funds, as necessary, with existing non-profit NSP
contractors/developers, including the San Diego Community Housing Corporation, to
acquire and rehabilitate properties under the NSP program in order to obligate grant funds
by September 2010.
Proiect Scope and Contractual Requirements
As proposed, the services to be provided by Community HousingWorks are generally
performed in nine phases: (1) identify properties, (2) conduct financial feasibility, (3)
submit to the City a pro forma for review and approval, (4) make an offer on a property,
close escrow, and record City's affordable housing loan documents securing the City's
financial interest (5) complete acquisition, (6) complete any rehabilitation needed for
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March 23, 2010, Item~
Page 3 of3
occupancy, (7) market the units to pre-committed or other NSP eligible households, (8)
underwrite and service the City's gap financing, and (9) create a revolving loan fund for all
proceeds returned to the City through escrow first mortgage payoffs.
DECISION MAKER CONFLICT
Staff has reviewed the property holdings of the City Council and has found that
Councilmembers Castaneda, Bensoussan, and Thompson have property holdings within
500 feet of the boundaries or within the target neighborhoods which are the subject of this
action.
Due to identified conflicts during the initial target area development, City staff requested a
written opinion from the Fair Political Practices Commission ("FPPC"). In response, the
FPPC opined that Councilmembers could participate in the decision on this matter because,
"it does not appear foreseeable that the decision to appropriate HUD funds will have a
material financial effect [on a council member]." Based on the information in said FPPC
letter, Councilmembers Castaneda, Bensousssan, and Thompson do not have a conflict.
FISCAL IMPACT
Current
There is no fiscal impact by tonight's action. NSP funds were previously appropriated by
Council on March 24, 2009.
Ongoing
There are no ongoing fiscal impacts as the program is revenue offset by the grant funds.
ATTACHMENTS
Attachment I: Developer Agreement
Prepared by: Stacey Kurz, Senior Project Coordinator,
Development Services Department, Housing Division
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RESOLUTION NO. 2010-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA APPROVING AN AGREEMENT BETWEEN
THE CITY OF CHULA VISTA AND COMMUNITY
HOUSINGWORKS FOR THE IMPLEMENTATION OF THE
DEPARTMENT OF HOUSING AND URBAN
DEVELOPMENT NEIGHBORHOOD STABILIZATION
PROGRAM (NSP); AUTHORIZING THE CITY MANAGER
TO EXECUTE THE AGREEMENT AND ANY NECESSARY
DOCUMENTS TO OBLIGATE NSP FUNDS; AND
AUTHORIZING THE CITY MANAGER TO REALLOCATE
UNOBLIGATED NSP FUNDS WITH EXISTING NSP NON-
PROFIT CONTRACTORS/DEVELOPERS, INCLUDING THE
SAN DIEGO COMMUNITY HOUSING CORPORATION, TO
ACQUIRE AND REHABILITATE PROPERTIES UNDER
THE NSP PROGRAM
WHEREAS, the City of Chula Vista will receive $2,830,072 of which $1,547,064 is
earmarked to assist low- and moderate-income households purchase foreclosed properties from
the Neighborhood Stabilization Program (NSP); and
WHEREAS, in January, 2009, HUD approved the City's Amended 2008-2009 Annual
Action Plan containing the proposed activities to be funded with NSP funds, including providing
soft second financial assistance for low- and moderate-income first-time homebuyers to purchase
foreclosed properties in target neighborhoods; and
WHEREAS, on September I, 2009, Council approved the submittal of an amendment
of the Fiscal Year 2008/2009 Action Plan for Neighborhood Stabilization Plan (NSP) funds to
"expand" the target areas of greatest need; utilize such funds in the "expanded" areas of greatest
need; add a NSP eligible use to purchase and rehabilitate homes that have been abandoned or
foreclosed upon, in order to sell such homes and properties; and authorized staff to reallocate
funds as necessary; and
WHEREAS, in September, 2009, HUD approved the expansion of home buyer activities
to include the Acquisition and Rehabilitation of properties for resale to eligible first-time
homebuyers; and
WHEREAS, the City Council of the City of Chula Vista wishes to approve the
Agreement between the City of Chula Vista and Community HousingWorks to acquire and
rehabilitate foreclosed properties for the purposes of reselling them to eligible low- and
moderate- income households within NSP eligible target areas; and
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Resolution No. 2010-
Page 2
WHEREAS, staff identified that if unobligated NSP funds were still available after
December 2009, a portion of such funds could be reallocated to partner with existing NSP non-
profit contractors/developers to acquire and rehabilitate properties for the purpose of renting or
reselling to qualified NSP participants under the NSP program and, in so doing, ensure the City
is able to timely meet grant obligation requirements by September 2010; and
WHEREAS, the City had approved an Agreement with the San Diego Community
Housing Corporation (SDCHC) in October 2009 to provide permanent rental housing for low
income-households within NSP eligible target areas and, as such, SDCHC is an existing NSP
non-profit contractor/developer with whom the City could also partner to acquire and rehabilitate
properties under the NSP program.
NOW, THEREFORE, THE CITY COUNCIL OF THE CITY OF CHULA VISTA
HEREBY DOES RESOLVES as follows:
(I) The Agreement between the City of Chula Vista and Community HousingWorks to
acquire and rehabilitate foreclosed properties for the purposes of reselling them to
eligible low- and moderate- income households within NSP eligible target areas is
approved; and
(2) The City Manager is authorized to execute the Agreement and any documents necessary
to secure the City's financial interests in the above stated Agreement with Community
HousingWorks; and
(3) The City Manager is further authorized to reallocate unobligated NSP funds with existing
non-profit NSP contractors/developers, including the San Diego Community Housing
Corporation, to acquire and rehabilitate properties under the NSP program.
Presented by:
Approved as to form by:
James D. Sandoval
City Manager
.~/?(
Bart C. Miesfeld
City Attorney
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THE ATTACHED AGREEMENT HAS BEEN REVIEWED
AND APPROVED AS TO FORM BY THE CITY
ATTORNEY'S OFFICE AND WILL BE
FORMALL Y SIGNED UPON APPROVAL BY
THE CITY COUNCIL
A~A
Bart C. Miesfeld
City Attorney
Dated: 3 Ln-II 0
AGREEMENT BETWEEN THE CITY OF CHULA VISTA AND
COMMUNITY HOUSINGWORKS
FOR MANAGEMENT AND IMPLEMENT AnON OF
A NEIGHBORHOOD ST ABILIZA nON PROGRAM
3-6
01Y OF
CHUIA VISTA .
AGREEMENT
BY AND BETWEEN THE
CITY OF CHULA VISTA
AND
COMMUNITY HOUSINGWORKS
FOR MANAGEMENT AND IMPLEMENTATION OF
A NEIGHBORHOOD ST ABILIZA TION PROGRAM
This Contract Number by and between Community
HousingWorks (hereinafter referred to as "Developer") and the City of Chula Vista
(hereinafter referred to as "City") is effective on March 24, 20 I 0 ("Effective Date").
WIT N E SSE T H:
WHEREAS, the Neighborhood Stabilization Program (NSP), authorized under
Title III of Division B of the Housing and Economic Recovery Act of2008 (HERA), is a
special allocation of Community Development Block Grant (CDBG) funds targeted at
acquisition and rehabilitation of foreclosed and abandoned properties in eligible
neighborhoods; and
WHEREAS, the Department of Housing and Urban Development described
regulatory requirements in Federal Register Notice (FR-5255-N-Ol) dated October 6,
2008, and amended such requirements by Federal Register Notice (FR-5255-N-02)
Notice of Allocations, Application Procedures, Regulatory Waivers Granted to and
Alternative Requirements for Emergency Assistance for Redevelopment of Abandoned
and Foreclosed Homes Grantees under the Housing and Economic Recovery Act, 2008;
and
WHEREAS, the City, is authorized to apply for and accept Neighborhood
Stabilization Program Grant funds; and
WHEREAS, City incorporated the use of Neighborhood Stabilization Program
funds described in Attachment "A" hereof (hereinafter referred to as the "Project") into
the City's Community Development Block Grant/HOME Investment
Partnership/Emergency Shelter Grant Annual Funding Plan Amendment which was
submitted to the U.S. Department of Housing and Urban Development (HUD); and
WHEREAS, HUD has approved the City Annual Funding Plan Amendment for
the Neighborhood Stabilization Program; and
NSP Developer Agreement
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WHEREAS, Neighborhood Stabilization Program funds are generally construed
as CDBG program funds, subject to CDBG program requirements (unless superseded by
HERA) and is considered a special allocation of Fiscal Year (FY) 2008 CDBG funding;
and
WHEREAS, it is the desire of the Developer and the City that the Project be
implemented by the Developer; and
WHEREAS, the Developer shall undertake the same obligations to the City with
respect to the Project in the City's aforesaid Amendment to the Annual Funding Plan for
participation in the Neighborhood Stabilization Program; and
WHEREAS, the City seeks to utilize the services of Developer to administer the
above referenced NSP program to purchase and rehabilitate foreclosed and abandoned
properties as permitted by the NSP program guidelines and this Agreement for the
purchase and resale of those foreclosed and abandoned properties; and
WHEREAS, Developer warrants and represents that they experienced and staffed
in a manner such that they are and can deliver the services required of Developer to City
within the time frames herein provided all in accordance with the terms and conditions of
this Agreement.
NOW THEREFORE, IT IS AGREED AS FOLLOWS:
1. WORK TO BE PERFORMED: Developer shall implement the scope of work
eScope of Work") described in Attachment A, hereof fully and in accordance
with the terms of the Annual Funding Plan Amendment approved by the City and
submitted to HUD in application for NSP funds to carry out the Project and the
Certifications which were submitted concurrently with the Annual Funding Plan
Amendment. The Annual Funding Plan and Certifications form is hereby
incorporated by reference into this contract fully as if set forth herein.
Developer shall also undertake the same obligations to the City that the City has
undertaken to HUD pursuant to said Annual Funding Plan Amendment and
Certifications. The obligations undertaken by Developer include, but are not
limited to, the obligation as applicable comply with each of the following as may
be amended from time to time and be amended for specific Neighborhood
Stabilization Program activities described in Federal Register Notices FR-5255-
N-Ol and FR-5255-N-02:
a. HERA alternative requirements to provisions under Title I of the Housing and
Community Development Act of 1974 (Public Law 93-383, as amended, 42
USC 9 5301, et seq.), as amended, except for requirements related to fair
housing, nondiscrimination, labor standards, and the environmental
(including lead-based paint), in accordance with the terms of section 2301 of
HERA and for the sole purpose of expending the use of grant funds;
NSP Developer Agreement
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b. HUD regulations relating to Community Development Block Grants (24 CFR
570.1, et seg.) unless superseded by HERA;
c. The regulations in 24 CFR Part 58 specifying other provisions of the law that
further the purposes of the National Environmental Policy Act of 1969 and
the procedures by which grantees must fulfill their environmental
responsibilities;
d. Title VI of the Civil Rights Act of 1964 (42 USC 9 2000d); Title VII of the
Civil Rights Act of 1964 (Public Law 88-352); Title VIII of the Civil Rights
Act of 1968 (Fair Housing Act, 42 USC 9 3601, et seg.); Section 109 of the
Housing and Community Development Act of 1974; Executive Order 11246,
as amended (equal employment opportunity); Executive Order 11063 (non-
discrimination), as amended by Executive Order 12259; and any HUD
regulations heretofore issued or to be issued to implement these authorities
relating to civil rights;
e. Section 3 of the Housing and Urban Development Act of 1968, as amended,
12 U.S.c. 1701u.
All section 3 covered contracts shall include the following clause (referred to
as the "section 3 clause"):
i. The work to be performed under this contract is subject to the
requirements of section 3 of the Housing and Urban Development Act of
1968, as amended, 12 U.S.C. 170lu (section 3). The purpose of section 3
is to ensure that employment and other economic opportunities generated
by HUD assistance or HUD-assisted projects covered by section 3, shall,
to the greatest extent feasible, be directed to low- and very low-income
persons, particularly persons who are recipients of HUD assistance for
housing.
11. The parties to this contract agree to comply with HUD's regulations in 24
CFR part 135, which implement section 3. As evidenced by their
execution of this contract, the parties to this contract certify that they are
under no contractual or other impediment that would prevent them from
complying with the part 135 regulations.
111. The Developer agrees to send to each labor organization or representative
of workers with which the Developer has a collective bargaining
agreement or other understanding, if any, a notice advising the labor
organization or workers' representative of the Developer's commitments
under this section 3 clause, and will post copies of the notice in
conspicuous places at the work site where both employees and applicants
for training and employment positions can see the notice. The notice shall
describe the section 3 preference, shall set forth minimum number and job
titles subject to hire, availability of apprenticeship and training positions,
the qualifications for each; and the name and location of the person(s)
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taking applications for each of the positions; and the anticipated date the
work shall begin.
IV. The Developer agrees to include this section 3 clause in every subcontract
subject to compliance with regulations in 24 CFR part 135, and agrees to
take appropriate action, as providelf in an applicable provision of the
subcontract or in this section 3 clause, upon a finding that the sub-
contractor is in violation of the regulations in 24 CFR part 135. The
Developer will not subcontract with any sub-contractor where the
Developer has notice or knowledge that the sub contractor has been found
in violation of the regulations in 24 CFR part 135.
v. The Developer will certify that any vacant employment positions,
including training positions, that are filled (l) after the Developer is
selected but before the contract is executed, and (2) with persons other
than those to whom the regulations of 24 CFR part 135 require
employment opportunities to be directed, were not filled to circumvent
the Developer's obligations under 24 CFR part 135.
VI. Noncompliance with HUD's regulations in 24 CFR part 135 may result in
sanctions, termination of this contract for default, and debarment or
suspension from future HUD assisted contracts.
vii. With respect to work performed in connection with section 3 covered
Indian housing assistance, section 7 (b) of the Indian Self-Determination
and Education Assistance Act (25 U.S.C. 450e) also applies to the work
to be performed under this contract. Section 7(b) requires that to the
greatest extent feasible (i) preference and opportunities for training and
employment shall be given to Indians, and (ii) preference in the award of
contracts and subcontracts shall be given to Indian organizations and
Indian-owned Economic Enterprises. Parties to this contract that are
subject to the provisions of section 3 and section 7(b) agree to comply
with section 3 to the maximum extent feasible, but not in derogation of
compliance with section 7(b).
f. The Uniform Relocation Assistance and Real Property Acquisition Policies
Act of 1979,42 USC !j 4601, et seq., and regulations adopted to implement
that Act in 49 CFR Part 24; except as those provisions are modified by the
Notice for the NSP Program published by HUD.
g. Office of Management and Budget ("OMB") Circular A-122 entitled "Cost
Principles for Non-Profit Organizations"; OMB Circular A-133 entitled
"Audits of States, Local Governments, and Non-Profit Organizations"; and
OMB Circular A-IIO entitled "Uniform Administrative Requirement for
Grants and Agreements with Institutions of Higher Education, Hospitals, and
Other N on-Profit Organizations."
h. Grant administration requirements as described in 24 CFR 570.504 and
CDBG program income requirements at 24 CFR Part 570.500(a) shall not
apply to the amounts received by the City ("Proceeds"), as allowable under
NSP Developer Agreement
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Section 230 I (d)( 4). Any real property under Developer's control acquired or
improved in whole or in part with Community Development Block Grant
funds will be used to meet one of the Neighborhood Stabilization Program
National Objectives, as defined in 24 CFR 570.208, and outlined in the City
of Chula Vista Annual Funding Plan Amendment (i.e. NSP Plan);
1. 24 CFR 570.505 concerning use of real property;
J. The following laws and regulations relating to preservation of historic places:
National Historic Preservation Act of 1966 (Public Law 89-665); the
Historical and Archaeological Preservation Act of 1974 (Public Law 93-291);
and Executive Order 11593;
k. The Labor Standards Regulations set forth in 24 CFR 570.603;
1. Labor Code section 1771 concerning prevailing wages;
m. The Hatch Act relating to the conduct of political activities (5 U.S.c. ~ 1501,
et seq.);
n. The Flood Disaster Protection Act of 1973 (42 U.S.c. ~ 4001, et seq., and the
implementing regulations in 44 CFR Parts 59-78);
o. The Rehabilitation Act of 1973 (Public Law 93-112) as amended, including
Section 504 which relates to nondiscrimination in federal programs and HUD
24 CFR Part 8;
p. The Clean Air Act (42 U.S.C. ~ 7401, et seq.) and the Federal Water
Pollution Control Act, as amended (33 U.S.C. ~ 1251, et seq.) and the
regulations adopted pursuant thereto (40 CFR Part 6);
q. The Drug-Free Workplace Act of 1988 (Public Law 100-690);
r. The Lead-Based Paint Poisoning Prevention Act, the Residential Lead-Based
Paint Hazard Reduction Act of 1992, and implementing regulations at 24
CFR Part 35;
s. No member, officer or employee of the Developer, or its designee or agents,
no member of the governing body of the locality in which the program is
situated, and no other public official of such locality or localities who
exercises any functions or responsibilities with respect to the program during
his/her tenure or for one year thereafter, shall have any interest, direct, or
indirect, in any contract or subcontract, or the process thereof, for work to be
performed in connection with the program assisted under the Grant, and that
it shall incorporate, or cause to be incorporated, in all such contracts or
NSP Developer Agreement
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subcontracts a provision prohibiting such interest pursuant to the purposes of
this certification.
t. The Developer certifies, that in accordance with Section 319 of Public Law
101-121, to the best of his or her knowle5fge and belief that:
1. No federal appropriated funds have been paid or will be paid, by or on
behalf of the undersigned, to any person for influencing or attempting to
influence an officer or employee of any agency, a member of Congress,
an officer or employee of Congress, in connection with the awarding of
any federal contract, the making of any federal grant, the making of any
federal loan, the entering into of any cooperative contract, and the
extension, continuation, renewals, amendment, or modifications of any
federal contract, grant loan, or cooperative contract.
n. If any funds other than federal appropriated funds have been paid or will
be paid to any person for influencing or attempting to influence an officer
or employee of any agency, a member of Congress, or an employee of a
member of Congress in connection with this federal contract, grant, loan,
or cooperative contract, the undersigned shall complete and submit
Standard Fonn-LLL, "Disclosure Fonn to Report Lobbying", in
accordance with its instructions.
u. The Architectural Barriers Act of 1968 (42 U.S.C. 94151, et seq.);
v. The Americans with Disabilities Act (42 U.S.c. 912101); and
w. The bonding requirements described in 24 CFR Part 85.36 required for
construction or facility improvement contracts or subcontracts that exceed the
simplified acquisition threshold (defined at 41 U.S.C. 403(11)). These
requirements are further described in Attachment A, which is attached hereto
and incorporated by reference.
x. Developer shall hold City harmless and indemnifY City against any hann that
it may suffer with respect to HUD on account of any failure on the part of the
Developer to comply with the requirements of any such obligation.
2. COMPLIANCE WITH LAWS: Developer shall comply with all applicable local,
state, and federal laws, regulations, ordinances, and City Policies when
perfonning the work required by this Contract.
3. COMPENSATION: City shall reimburse Developer for nonnal costs associated
with acquisition, rehabilitation and resale of properties, including but not limited
to and as approved by the City and in compliance with Section 2301 (d)(2): initial
acquisition and "Activity Delivery Costs" including real estate commissions (not
to exceed 5% per property), environment and inspection costs (not to exceed $200
NSP Developer Agreement
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per property), recordation fees as applicable, rehabilitation costs as approved by
the City (including a not to exceed $500 administrative oversight fee), and
underwriting fees as allowable under the existing agreement between the City of
Chula Vista and Community HousingWorks for "Management of a First Time
Homebuyer Down Payment and Closing Costs Assistance Program"
("Homebuyer Agreement") dated August 27, 2006 and amended on June 19, 2008
and March 24, 2009. Total reimbursement (for project costs) shall not exceed
$300,000 per property, unless approved by the City, and $1,505,564 for the total
program. Developer shall not submit claims to the City nor shall City reimburse
Developer for costs for which Developer is reimbursed from a source other than
the funds allocated for work under this Contract.
4. COMPENSA nON SCHEDULE: City shall pay Developer monthly progress
payments upon submittal by Developer of a certified statement of actual
expenditures incurred and/or upon Developer request a minimum of five days
prior to estimated escrow close, the City shall wire funds to escrow for the
acquisition of properties. Payment by City is not to be construed as final in the
event HUD disallows reimbursement for the project or any portion thereof.
5. INDIRECT COSTS: If indirect costs are charged, the Developer will develop an
indirect cost allocation plan for determining the appropriate Developer's share of
administrative costs and shall submit such plan to the City for approval.
6. EXPENDITURE STANDARD: To insure effective administration and
performance of approved Neighborhood Stabilization Program projects and to
meet HUD performance standards, Developer shall demonstrate reasonable
progress on implementation of the project, expending all contracted funds within
the term of the contract. In the event all funds are not expended within the term
period, the City shall notifY the Developer of the expenditure deficiency.
Developer will have a total of 30 days from the date of the City's written
notification to correct the deficiency. If the deficiency is not corrected within that
time, Developer agrees that the City may reallocate the amount of the expenditure
deficiency.
7. TERM: The term of this Agreement shall be from March 24, 2010 and shall end
June 30, 2011, unless extended by the City. Developer shall make all good faith
and reasonable efforts to expend the initial NSP project funds that are available
($1,505,564) by June 30, 2010. If Developer fails to expend the aforementioned
initial NSP project funds by June 30, 2010, such failure shall constitute "cause" to
terminate this Agreement and the City may terminate the Agreement at any time
thereafter pursuant to Section 10. After the aforementioned initial NSP project
funds are expended, Developer shall expend any and all NSP funds, including, but
not limited to, funds not previously expended and monies acquired from the sale
of the rehabilitated homes until the Agreement ends on June 30, 2011. With City
approval, the term of this Agreement may be extended to cover any additional
time period required to expend funds subject to this Agreement.
NSP Developer Agreement
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8. TERMINATION FOR CONVENIENCE: The City may terminate the agreement
for convenience in accordance with 24 CFR 85.44. In that event, all finished and
unfinished documents and other materials, and properties owned or possessed by
Developer, at the option of the City, become City's sole and exclusive property. If
the Agreement is terminated by City as provided in this paragraph, Developer
shall be entitled to receive just and equitable compensation, in an amount not to
exceed that payable under this Agreement, for any satisfactory work completed on
such documents and other materials and properties to the effective date of such
termination. Developer hereby expressly waives any and all claims for damages
or compensation arising under this Agreement except as set forth herein.
9. AUTOMATIC TERMINATION: This Contract shall terminate at the discretion
of the City if the United States Government terminates the Neighborhood
Stabilization Community Development Block Grant Program or terminates the
Project that is the subject ofthis Contract. Developer hereby expressly waives any
and all claims for damages or compensation arising under this Agreement for
termination under this basis.
10. TERMINATION OF CONTRACT FOR CAUSE: Developer and City recognize
that the City is the governmental entity which executed the grant agreement
received pursuant to the City's application and that City is responsible for the
proper performance of the Project. If Developer fails to fulfill in a timely and
proper manner its obligations under this Contract to undertake, conduct or
perform the Project identified in this Contract, or if Developer violates any state
laws or regulations or local ordinances or regulations applicable to
implementation of the Project, or if Developer violates any provisions of this
contract, City shall have the right to terminate this contract by giving at least five
days written notice to Developer of the effective date of termination.
Even if City terminates the Contract, Developer shall remain liable to City for all
damages sustained by City due to Developer's failure to fulfill any provisions of
this Contract, and City may withhold any reimbursement payments form
Developer for the purpose of set-off until the exact amount of damages due to
City from Developer is determined. Developer hereby expressly waives any and
all claims for damages for compensation arising under this contract except as set
forth in this section in the event of such termination. The City may also, in lieu of
termination and at its discretion, take any action, as stated in 24 CFR 85.43,
subdivision (a), sections I to 5, to enforce this Agreement.
II. CONTRACT ADMINISTRATION: The Housing Manager of the Citv of Chula
Vista shall administer this Contract on behalf of the City. The Chief Executive
Officer of the Community Housing Works shall administer this contract on behalf
of the Developer. Within a reasonable time after the City makes a request,
Developer shall give the City progress reports or other documentation as required
by the City's Administrator to audit Developer's performance of this Contract.
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12. RECORDS AND REPORTS: The Developer shall maintain records and make
such reports as required by the City of Chula Vista to, but not limited to, enable
the City to analyze Developer's project and to comply with any and all reporting
requirements required under the grant. All records of the Developer related to this
Contract or work performed under the Contract shall be open and available for
inspection by HUD and/or City monitors and auditors during normal business
hours.
13. RETENTION: The Developer shall retain all financial records, supporting
documents, statistical records, and all other records pertinent to the Agreement for
a period of five (5) years. The retention period begins on the date of the
submission of the Grantee's annual performance and evaluation report to HUD in
which the activities assisted under the Agreement are reported on for the final
time. Notwithstanding the above, if there is litigation, claims, audits, negotiations
or other actions that involve any of the records cited and that have started before
the expiration of the five-year period, then such records must be retained until
completion of the actions and resolution of all issues, or the expiration of the five-
year period, whichever occurs later.
14. DATA: The Developer shall maintain data demonstrating eligibility (low-
moderate locations) for services provided. Such data shall include, but not be
limited to exact location of the work performed, and a description of service
provided. Such information shall be made available to City monitors or their
designees for review upon request.
IS. DISCLOSURE: The Developer understands that client information collected
under this contract is private and the use or disclosure of such information, when
not directly connected with the administration of the City's or Developer's
responsibilities with respect to services provided under this contract, is prohibited
by the state of Federal law privacy laws unless written consent is obtained from
such person receiving service and, in the case of a minor, that of a responsible
parenti guardian.
16. OUARTERL Y REPORTS/ANNUAL REPORT: Developer shall provide the
City with a quarterly report, submitted no later than IS days after the last day of
the previous quarter, which includes a narrative of the services provided, progress
towards meeting the timeline goals stated in the contract, and an itemized
accounting of the expenditures of CDBG funds during the previous quarter.
Failure to submit quarterly reports in a timely manner will result in withholding of
CDBG funds until the report has been submitted. Quarterly Performance Reports
are due October 15 (15t Quarter), January 15 (2nd Quarter), April 15, (3'd
Quarter) and July 15 (4th Quarter). The Armual Performance Report will also be
due July 15.
NSP Developer Agreement
3-15
Page 9 of 13
17. INDEMNIFICATlON: City shall not be liable for, and Developer shall defend,
indemnify, and hold the City, its officers, agents, employees and volunteers
harmless from and against any and all claims, deductibles, self-insured retentions,
demands, liability, judgments, awards, fines, mechanics' liens or other liens, labor
disputes, losses, damages, expenses, charge;; or costs of any kind or character,
including attorneys' fees and court costs by this Contract arising either directly or
indirectly from any act, error, omission or negligence of Developer or its officers,
employees, agents, Developers, licensees or servants, contractors or
subcontractors, including without limitation, claims caused by the concurrent act,
error, omission or negligence, whether active or passive, of City, and/or its agents,
officers, employees or volunteers. However, Developer shall have no obligation
to defend or indemnify City from a claim if it is determined by a court of
competent jurisdiction that such claim was caused by the sole negligence or
willful misconduct of City or its agents or employees.
Developer and its successors, assigns, and guarantors, if any, jointly and severally
agree to indemnify, defend (with counsel selected by City) reimburse and hold
City and its officers, employees and agents harmless from any claims, judgments,
damages, penalties, fines, costs, liabilities (including sums paid in settlement of
claims) or loss, including attorneys' fees, consultant's fees, and experts' fees
which arise during or after the contract term for any losses incurred in connection
with investigation of site conditions, or any cleanup, remedial, removal or
restoration work required by any hazardous materials laws because of the
presence of hazardous materials, in the soil, ground water or soil vapors on the
premises, and the release or discharge of hazardous materials by Developer
during the course of any alteration or improvements of the Premises by
Developer, unless hazardous materials are present solely as a result of the gross
negligence or willful misconduct of City, its officers, employees or agents. The
indemnification provided by this section shall also specifically cover costs
incurred in responding to:
a. Hazardous materials present or suspected to be present in the soil, ground
water to or under the Property before the commencement date;
b. Hazardous materials that migrate, flow, percolate, diffuse, or in any way
move on to or under the Property following the commencement date;
c. Hazardous materials present on or under the Property as a result of any
discharge, release, dumping, spilling (accidental or otherwise), onto the
Property during or after the term of this Contract by any person, corporation,
partnership or entity other than City.
Funding from this program is a result of a Federal Grant, should Federal funding
be terminated for any reason, City is not liable for any consequence of any type
resulting directly or indirectly from the termination of federal funding and
Developer agrees, in addition to any other indemnification provision set forth in
NSP Developer Agreement
3-16
Page 10 of 13
this agreement, to indemnify, hold harmless, and defend the City against any
claim, cause of action, or any form of liability as a result of, directly or indirectly,
funding termination.
The foregoing indemnities shall survive tbe expiration or termination of the
contract any or any transfer of all or any portion of the Premises, or of any
interest in this Contract and shall be governed by the laws of the State of
California.
18. ADMINISTRATIVE CLAIMS REQUIREMENTS AND PRQCEDURES. No
suit or arbitration shall be brought arising out of this Agreement, against the City
unless a claim has first been presented in writing and filed with the City and acted
upon by the City in accordance with the procedures set forth in Chapter 1.34 of
the Chula Vista Municipal Code, as same may from time to time be amended, the
provisions of which are incorporated by this reference as if fully set forth herein,
and such policies and procedures used by the City in the implementation of same.
Upon request by City, Developer shall meet and confer in good faith with City
for the purpose of resolving any dispute over the terms of this Agreement.
19. AUDIT COSTS: Developer shall reimburse City for all costs incurred to
investigate and audit Developer's performance of its duties under the Contract if
Developer is subsequently found to have violated the terms of the Contract.
Reimbursement shall include all direct and indirect expenditures incurred to
conduct the investigation or audit. City may deduct all such costs from any
amount due Developer under this Contract.
20. ENTIRE AGREEMENT: This Contract and referenced Attachments and Exhibits
constitutes the entire agreement of the parties and supersedes any previous oral or
written understandings or contracts related to the matters covered herein.
21. MODIFICATION. This Contract may not be modified except by written
amendment executed by each party.
22. ACKNOWLEDGEMENT OF FUNDING: Developer shall identify the City of
Chula Vista as the source of funding, or, if applicable, one of the sources of
funding in public announcements that are made regarding the Project.
Acknowledgement of the City's funding roles, for example, should be included in
publicity materials related to the Project. In addition, Developer agrees that the
City shall be apprised of any special events linked to the Project so that a review
can be made on what role, if any, the City would assume.
23. INSURANCE: Developer agrees to comply with the insurance requirement set
forth in Attachment "8" and/or any additional insurance requirements requested
by the City, as the City deems appropriate. Failure to acquire and maintain the
required insurance is a basis to take an enforcement action, or terminate this
agreement.
NSP Developer Agreement
3-17
Page 11 of 13
24. NO WAIVER: No failure, inaction, neglect or delay by City in exercising any of
its rights under this Contract shall operate as a waiver, forfeiture or abandonment
of such rights or any other rights under this Contract.
25. NOTICE: Any notice or notices required or permitted to be given pursuant to this
Contract shall be personally served by the party giving notice or shall be served
by certified mail. Notices shall be sufficient if personally served on or if sent by
certified mail, postage prepaid, addressed to:
Developer:
Community HousingWorks
President & CEO
4345 University Avenue, Suite 550
San Diego, CA 92105
City:
City of Chula Vista
Housing Manager
276 Fourth Avenue
Chula Vista, CA 91910
(End of page. Next page is signature page.)
NSP Developer Agreement
3-18
Page 12 of 13
Signature Page.
to
Agreement between
City ofChula Vista and
Community HousingWorks
IN WITNESS WHEREOF, the Parties have executed this contract as of the date first
written above.
Dated:
City ofChula Vista
By:
James D. Sandoval.
City Manager, City ofChula Vista
Attest:
Donna Norris, City Clerk
Approved as to form:
Bart Miesfeld, City Attorney
Dated:
\
Susan M. Reynolds '--
President and CEO
Attachment A: Scope of Work
Attachment .B:. Insurance Requirements
Attachment C: Income Limits
Attachment 0: Disclosure Form
Exhibit I: Deed ofTmst
Exhibit 2: Note Secured by Deed ofImst
NSP Developer Agreement
Page 13 of 13
3-19
ATTACHMENT "A"
SCOPE OF WORK
COMMUNITY HOUSINGWORKS (DEVELOPER) has a certain project to be
implemented with Neighborhood Stabilization Program (NSP) Community Development
Block Grant (CDBG) Program funds. The work to be accomplished includes the
following:
Developer:
· Shall utilize Neighborhood Stabilization Program (NSP) funding for acquisition
and rehabilitation of foreclosed and abandoned single-family residential
properties for re-sale to eligible homebuyers (as approved by the City) in NSP
eligible areas and provide project management and oversight of services for
certain aspects of the NSP, hereinafter referred to as "Project(s)."
· Shall submit information of each proposed property to be acquired with NSP
funds for City review and approval prior to acquisition, including but not limited
to:
o Itemized cost for acquisition and rehabilitation with estimated resale price
within price range of pre-committed buyers;
o Proof of due diligence that property meets NSP eligibility (i.e. target area
and vacancy requirements); and
o Property age, location, and owner contact information.
· Work with the City to conduct all required environmental review of properties in
compliance with regulations at 24 CFR Part 58, and include appropriate language
in purchase contracts for a conditional contract.
· Shall conduct appraisals in accordance with NSP guidelines and the NS FTHB
Program Guidelines.
. Shall negotiate a discount purchase price (minimum I % of appraised value) for
certain identified abandoned and/or foreclosed residential properties trom
lenders/property owners in accordance with NSP guidelines, and shall perform
due diligence to ensure that all properties acquired have clear marketable title.
· Properties purchased, rehabilitated, and resold under this agreement may only be
used to benefit eligible households earning less than one hundred twenty 120%
(percent) of the Area Median Income (AMI), as defined by the NSP and the
City's Annual Funding Plan Amendment using 24 CFR Part 5 definition of
mcome.
· The cost of acquisition and/or rehabilitation and resale of properties purchased
under the NSP are eligible expenses under this agreement.
. With regard to the NSP eligible affordable housing project(s), Developer shall
execute and use, be bound by and abide by the terms of, and cause to be
encumbered the title of property acquired under the Project(s) as stated in the
attached sample City's Deed of Trust (Exhibit I) and Note Secured By Deed of
Trust (Exhibit 2) to be recorded at time of escrow securing the City's financial
interest in the project(s) and affordability period. These documents may be
altered prior to close of escrow at the discretion of the City.
· Shall carry out the Project under this Agreement in accordance with the guidelines
and regulations of the Neighborhood Stabilization Program as authorized under
Attachment "A"-Scope of Work
Page I of3
3-20
ATTACHMENT "A"
SCOPE OF WORK
Title III of Division B of the Housing and Economic Recovery Act of 2008
(HERA), as amended.
· Shall use the City of Chula Vista Rehabilitation Standards and at a minimum
comply with applicable laws, codes, and other requirements relating to health and
safety, quality, and habitability in order to s~ll such properties, including but not
limited to:
o Shall obtain any needed permits from the City of Chula Vista.
o Ensure all rehabilitation work is in compliance with OMB Circular A-122
for cost reasonableness and administrative requirements found in 24 CFR
84 for non-profit organizations.
o Will competitively bid any rehabilitation work exceeding $10,000 per
property, in compliance with City procurement standards, and submit a
copy of the bid package and specifications for City review and approval.
The project shall be advertised to solicit the most responsive and
responsible bidder. Developer shall notify potential bidders that this is a
federally funded NSP project that includes local, Federal, and State
requirements. The applicable Davis-Bacon decision rate shall be included
in the bid package, if applicable.
o Check the Excluded Parties List to ensure Contractors are not debarred or
suspended.
. Screen and determine eligibility for homebuyers in compliance with the
Neighborhood Stabilization First-Time Homebuyer (NS FTHB) Program
Guidelines and the existing Homebuyer Agreement, including the recordation of
homebuyer loan documents.
· Shall conduct open houses on all NSP properties for pre-committed eligible
buyers in cooperation with the City.
· Shall work with the City prior to the initial open house to establish a priority point
system for accepting offers.
· Final resale prices to eligible buyers shall be in an amount equal to or less than the
cost to acquire, rehabilitate, and resell such property, including related Activity
Delivery Costs (as defined under Section 3 above) in compliance with Section
2301(d)(2).
· Proceeds recaptured through first mortgages on the resale of the Projects shall be
repaid to the City for additional acquisition, rehabilitation, and resale activities in
Chula Vista, as allowable in Section 2301(d)(4) and/or for gap financing under
the City's Neighborhood Stabilization First-Time Homebuyer (NS FTHB)
Program, meeting NSP guidelines. Community HousingWorks shall conduct
such activities under this contract until funds have been extinguished or
terminated in writing by the City.
Citv:
· The City shall provide Developer with Deed of Trust (Exhibit I) and Promissory
Note (Exhibit 2) to be recorded at time of escrow securing the City's financial
interest in the project(s).
Attachment "A" -Scope of Work
Page 2 of3
3-21
A IT ACHMENT "A"
SCOPE OF WORK
· The City shall provide the Voluntary Acquisition form to acquire properties using
NSP funds.
· City shall provide Developer with maps of NSP eligible areas as approved by the
Department of Housing and Urban Development.
. City shall provide technical assistance to Developer to ensure NSP program is
carried out successfully and in compliance with HUD regulations.
The Scope of Services outlined above shall not be altered without written approval
ofthe City.
Performance Measurement: Create a minimum of 6 resale units serving households
earning less than 120% of the Area Median Income for the City of Chula Vista with the
initial NSP funds of $1,505,564.
CDBG National Objective: NSP Low and Moderate Income (LMH) Residents at or
below 120 (%) Percent Area Median Income
TIME SCHEDULE: Developer shall make all good faith and reasonable efforts to
expend the initial NSP project funds that are available ($1,505,564) by June 30, 2010 or
earlier. After the aforementioned initial NSP project funds are expended, Developer shall
expend any and all NSP funds, including, but not limited to, funds not previously
expended and monies acquired from the sale of the rehabilitated homes until the
Agreement ends on June 30, 20 II.
BUDGET: DEVELOPER shall make all good faith and reasonable efforts to complete
the work under this Contract within the following budget. In no case shall DEVELOPER
be entitled to, nor shall City reimburse DEVELOPER, more than $1,505,564 for work
performed under this Contract.
Developer shall also submit to the City in a timely matmer other reports as
requestedlrequired by HUD and/or the City including, but not limited to
Contractor/Subcontractor: Semi-Annual Labor Standards Enforcement Reports (HUD-
4710), Annual Minority Business Enterprise Activity Reports (HUD-2516), Section 3
Reports (HUD-60002) and provide, as requested by HUD and/or the City, information
necessary to prepare the Grantee Consolidated Annual Performance and Evaluation
Report (CAPER), Consolidated Plan, Annual Plan and other such reports and/or plans.
(End of page.)
Attachment "A"-Scope of Work
Page 3 of3
3-22
ATTACHMENT "8"
INSURANCE REQUIREMENTS
ContractorlDeveloper must procure insurance against claims for injuries to persons or damages
to property that may arise from or in connection with the performance of the work under the
contract and the results of that work by the Developer/Contractor, his agents, representatives,
employees or subcontractors and provide documentation of same prior to commencement or
work. The insurance must be maintained for the duration of the contract.
Minimum Scope ofInsurance
Coverage must be at least as broad as:
I. Insurance Services Office Commercial General Liability coverage (occurrence Form
CGOOO I )
2. Insurance Services Office Form Number CA 0001 covering Automobile Liability, code I
(any auto).
3. Workers' Compensation insurance as required by the State of California and Employer's
Liability Insurance.
Minimum Limits of Insurance
Developer/Contractor must maintain limits no less than:
I. General Liability:
(Including operations,
products and completed
operations, as applicable.)
2. Automobile Liability:
3. Workers' Compensation
Employer's Liability:
$1,000,000 per occurrence for bodily injury, personal injury and
property damage. If Commercial General Liability insurance
with a general aggregate limit is used, either the general
aggregate limit must apply separately to this project/location or
the general aggregate limit must be twice the required
occurrence limit.
$1,000,000 per accident for bodily injury and property damage.
Statutory
$1,000,000 each accident
$1,000,000 disease-policy limit
$1,000,000 disease-each employee
Deductibles and Self-Insured Retentions
Any deductibles or self-insured retentions must be declared to and approved by the City. At the
option of the City, either the insurer will reduce or eliminate such deductibles or self-insured
retentions as they pertain to the City, its officers, officials, employees and volunteers; or the
Developer/Contractor will provide a fmancial guarantee satisfactory to the City guaranteeing
payment of losses and related investigations, claim administration, and defense expenses.
Other Insurance Provisions
The general liability, automobile liability, and where appropriate, the worker's compensation
policies are to contain, or be endorsed to contain, the following provisions:
1. The City of Chula Vista, its officers, officials, employees, agents, and volunteers are
to be named as additional insureds with respect to liability arising out of automobiles
owned, leased, hired or borrowed by or on behalf of the Developer/contractor, where
Attachment "B" -Insurance Requirements
Page I ot3
3-23
applicable, and, with respect to liability arising out of work or operations performed by
or on behalf of the Developer/contractor including providing materials, parts or
equipment furnished in connection with such work or operations. The general liability
additional insured coverage must be provided in the form of an endorsement to the
Developer'slcontractor's insurance using ISO CG 2010 (11/85) or its equivalent.
Specifically, the endorsement must not exclude Products I Completed Operations
coverage.
2. The Developer's/contractor's insurance coverage must be primary insurance as it
pertains to the City, its officers, officials, employees, agents, and volunteers. Any
insurance or self-insurance maintained by the City, its officers, officials, employees, or
volunteers is wholly separate from the insurance of the Developer/contractor and in no
way relieves the Developer/contractor from its responsibility to provide insurance.
3. Each insurance policy required by this clause must be endorsed to state that coverage
will not be canceled by either party, except after thirty (30) days' prior written notice
to the City by certified mail, return receipt requested.
4. Coverage shall not extend to any indemnity coverage for the active negligence of the
additional insured in any case where an agreement to indemnify the additional insured
would be invalid under Subdivision (b) of Section 2782 of the Civil Code.
5. Developers/Contractor's insurer will provide a Waiver of Subrogation in favor of the
City for each required policy providing coverage during the life of this contract.
Acceptability orInsu rers
Insurance is to be placed with licensed insurers admitted to transact business in the State of
California with a current A.M Best's rating of no less than A V. Ifinsurance is placed with a
surplus lines insurer, insurer must be listed on the State of California List of Eligible Surplus
Lines Insurers (LESLJ) with a current A.M. Best's rating of no less than A X. Exception may
be made for the State Compensation Fund when not specifically rated.
Verification of Coverage
Developer/Contractor shall furnish the City with original certificates and amendatory
endorsements effecting coverage required by this clause. The endorsements should be on
insurance industry forms, provided those endorsements conform to the contract requirements.
All certificates and endorsements are to be received and approved by the City before work
commences. The City reserves the right to require, at any time, complete, certified copies of all
required insurance policies, including endorsements evidencing the coverage required by these
specifications.
Attachment "B" -Insurance Requirements
Page 2 of 3
3-24
Subcontractors
Developer/Contractor must include all subcontractors as insureds under its policies or furnish
separate certificates and endorsements for each subcontractor. All coverage for subcontractors
are subject to all of the requirements included in these specifications.
Bonding Requirements
Prior to commencement of rehabilitation, Developer shall file with the City on the approved
forms, the surety bonds in the amounts and for the purposes noted below. The surety must
posses a minimum rating from A.M. Best Company of A-VII. and be listed as an acceptable
surety on federal bonds by the United States Department ofthe Treasury. Developer shall pay
all premiums and costs thereof and incidental thereto, as security for payment of persons named
in California Civil Code Section 3181 or amounts due under Unemployment Insurance Code
with respect to Work or Labor performed by any such claimant. All alterations, time
extensions, extra and additional work, and other changes authorized by the Specifications, or
any part of the Contract, may be made without securing consent of the surety or sureties on the
contract bonds. Each bond shall be signed by both Developer and the sureties. Should any
surety or sureties be deemed unsatisfactory at any time by the City, notice will be given
Developer to that effect, and Developer shall forthwith substitute a new surety or sureties
satisfactory to the Developer. No further payment shall be deemed due or will be made under
the Contract until the new sureties qualify and are accepted by the City.
i. A bid guarantee from each bidder equivalent to five percent of the bid
price. The "'bid guarantee" shall consist of a firm commitment such as a
bid bond, certified check, or other negotiable instrument accompanying a
bid as assurance that the bidder will, upon acceptance of his bid, execute
such contractual documents as may be required within the time specified.
ii. A performance bond on the part of the developer for 100 percent of
the contract price, as determined ITom the prices in the bid form, and
shall insure the faithful performance by developer of all work under the
Contract. It shall also insure the replacing of, or making acceptable, any
defective materials or faulty workmanship.
iii. A payment bond on the part of the contractor for 100 percent of the
contract price, as determined fi-om the prices in the bid form, and shall
inure to the benefit of persons performing labor or furnishing materials in
connection with the work of the proposed Contract. This bond shall be
maintained in full force and effect until all work under the Contract is
completed and accepted by the City, and until all claims for materials
and labor have been paid.
Attachment "B" -Insurance Requirements
Page 3 of 3
3-25
80%
LOW INCOME
ANNUAL MONTHLY
INCOME' INCOME
$46,250 $3,854
$52,900 $4,408
$59,500 $4,958
$66,100 $5,508
$71,400 $5,950
$76,700 $6,392
$81,950 $6,829
$87,250 $7,271
ATTACHMENT "C"
2009 San Diego Income Limits
Median Income: $74,900
120%
MODERATE INCOME
ANNUAL MONTHLY
INCOME INCOME
$62,950 $5,246
$71,900 $5,992
$80,900 $6,742
$89,900 $7,492
$97,100 $8,092
$104,300 $8,692
$111,500 $9,292
$118,650 $9,888
*Income Limits 80% and Below are Based on HUD Formula Income Limits Adjusted for High
Housing Cost Area
Attachment "C" -Income Limits
Page 1 of 1
3-26
ATTACHMENT "D"
Redevelopment and Housing
Disclosure Statement
Pursuant to Council Policy 101-01, prior to any action upon matters that will require
discretionary action by the Council, Planning Commission and all other official bodies of the
City, a statement of disclosure of certain ownership of financial interests, payments, or campaign
contributions for a City ofChula Vista election must be filed. The following information must be
disclosed:
I. List the names of all persons having a financial interest in the project that is the
subject of the application or the contract. e.g., owner, applicant, contractor,
subcontractor, material supplier.
2. Ifany person' identified pursuant to (1) above is a corporation or partnership, list the
names of all individuals with a $2000 investment in the business
(corporation/partnership) entity.
3. Ifany person' identified pursuant to (1) above is a non-profit organization or trust,
list the names of any person serving as director of the non-profit organization or as
trustee or beneficiary or trustor ofthe trust.
4. Please identify every person, including any agents, employees, consultants, or
independent contractors you have assigned to represent you before the City in this
matter.
5. Has any person' associated with this contract had any financial dealings with an
official" of the City ofChula Vista as it relates to this contract within the past 12
months? Yes No
- -
[[Yes hriefly nescrihe the nature of the financial interest the official" may have in
Attachment "0" - Disclosure Form
Page 1 of 2
3-27
this contract.
6. Have you made a contribution of more than $250 within the past twelve (12) months
to a current member of the Chula Vista City Council? No_ Yes_ If yes, which
Council member?
7. Have you provided more than $340 (or an item of equivalent) to an official** of the
City of Chula Vista in the past twelve (12) months? (This includes being a source of
income, money to retire a legal debt, gift, loan, etc.)
Yes No
If Yes, which official** and what was the nature of item provided?
Date:
Signature of Developer
Print or type name of Developer
*
Person is defined as: any individual, firm, co-partnership, joint venture, association,
social club, fraternal organization, corporation, estate, trust, receiver, syndicate, any other
county, city, municipality, district, or other political subdivision, -or any other group or
combination acting as a unit.
**
Official includes, but is not limited to: Mayor, Council member, Planning
Commissioner, Member ofa board, commission, or committee of the City, employee, or
staff members.
Attachment "0" - Disclosure Form
Page 2 of 2
3-28
EXHIBIT 1
NO CHARGE ON TillS DOCUMENT
FOR THE BENEFIT OF A PUBLIC
AGENCY
Recording Requested By:
City Clerk
City ofChula Vista
276 Fourth Avenue
Chula Vista, California 91910
And When Recorded Mail To:
City Clerk
City ofChula Vista
276 Fourth Avenue
Chula Vista, California 91910
DEED OF TRUST
THIS DEED OF TRUST is dated as of the of _, 20_, by Community
HousingWorks, A California Non-Profit ('Trustor"), whose address is 4345 University Avenue, Suite
550, San Diego, CA 92105, Attention: Susan M. Reynolds, and THE CITY OF CHULA VISTA, a
public body, corporate and politic (the "Beneficiary" and 'Trustee"), whose address is 276 Fourth
Avenue, ChuIa Vista, California, 91910.
TRUSTOR HEREBY irrevocably grants, transfers, and assigns to Trustee, in trust, with
power of sale, all that property in the City ofChula Vista, County of San Diego, State of California
(the "Property"), described as:
(See Legal Description - Exhibit "A")
FOR THE PURPOSE OF SECURING:
(I) Payment of the indebtedness evidenced by a promissory note of even date herewith
executed by Trustor, in the principal sum of DOLLARS
($XXX,XXX), and any renewal, extension, or modification of the promissory note (the "NSP Loan");
Pursuant to the terms of the NSP Developer Agreement, dated (the
"Agreement"), providing the following:
Neighborhood Stabilization Program
City Council Resolution No. 2010-_
3-29
The NSP Loan will accrue interest at a rate of zero percent (0%) per annum. The NSP Loan shall be
due and payable On the earliest of: (a) the date the Assisted Unit is sold; or (b) an Event of Default by
Trustee which has not been cured as provided for in the Note. Notwithstanding the above, it is
intended that the full amount of the NSP Loan for the Assisted Unit will be reduced by the following:
(a) Homebuyer Subsidy. The Homebuyer Subsidy is the amount of the Selling Price minus the
principal balance of the "Qualified Homebuyer's" (households at or below one hundred and
twenty percent (120%) of the area median income) home loan (the "Homebuyer Loan"). The
Homebuyer Subsidy is limited to forty percent (40%) of the Selling Price and capped for a
maximum amount of$70,000. The Homebuyer Subsidy is an amount assumed in the form of
silent second mortgage assistance to Qualified Homebuyer in compliance with the
Neighborhood Stabilization First-Time Homebuyer Program Guidelines; and
(b) Closing Costs. Closing Costs for the sale of the Assisted Unit to Qualified Homebuyer.
The NSP Loan, less the sum ofthe Homebuyer Subsidy and Closing Costs shall be repaid to Trustee
upon the sale ofthe Assisted Unit. Upon the repayment of the NSP Loan, Trustee shall be released
ITom its repayment obligations. At the time of the sale of the Assisted Unit to Qualified Homebuyer,
Trustee shall cause to be delivered to Trustor a reconveyance of the Deed of Trust ITOm such
Assisted Unit and a termination of the Agreement as a lien on such Assisted Unit.
Upon transfer of title to the Qualified Homebuyer, a "Homebuyer Deed of Trust" and "Homeowner's
Regulatory Agreement for Neighborhood Stabilization Program Participation" shall be recorded to
secure the Homebuyer Subsidy ("Second Mortgage Loan"), and to require its repayment if the
Assisted Unit is no longer the principal residence and upon sale, rental, ref mance, conveyance,
transfer or change in title of the Assisted Unit prior to the expiration of the affordability period.
Sale, rental, refinance, conveyance, transfer or change in title of the Assisted Unit prior to the
expiration of the affordability period will cause the shared equity in addition to the principal as
provided in the Homebuyer Deed of Trust.
(2) Any additional sums and interest that may hereafter be loaned to the then record owner ofthe
Property by Trustee, when evidenced by another note or notes reciting that it or they are so secured;
(3) The performance of each agreement contained in this Deed of Trust, the terms being
synonymous, and the Note referenced in Paragraph (1) above; and
(4) The performance of each agreement of Trustor under that certain "Developer Agreement"
dated March 24,2010, terms and conditions of which bind the Property and run with the land and
which are being assumed by Trustor. Notwithstanding anything set forth herein to the contrary this
Deed of Trust expressly does not secure any obligations, covenants, indemnities or other agreements
of the Trustor, Community HousingWorks, - or their successors or assigns, under: (i) that certain
Developer Agreement between Community HousingWorks and Trustee.
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A. TO PROTECT THE SECURITY OF THIS DEED OF TRUST, TRUSTOR AGREES:
Maintenance and Repair
(I) To keep the Property in good condition and repair; not to remove or demolish any buildings
on the Property; to complete or restore promptly and in good and workmanlike manner any building
that may be constructed, damaged, or destroyed on the Property; to pay when due all claims for labor
performed and materials furnished for the Property; to comply with all laws affecting the Property or
requiring any alterations or improvements to be made on the Property; not to commit or permit waste
of the Property; not to commit, suffer, or permit any act upon the Property in violation oflaw; and to
cultivate, irrigate, fertilize, fumigate, prune, and do all other acts that trom the character or use of the
Property may be reasonably necessary.
Fire Insurance
(2) To provide, maintain, and deliver to Beneficiary fire insurance satisfactory to and with loss
payable to Beneficiary as its interest may appear. Subject to the rights of any senior lenders, the
amount collected under any fire or other insurance policy may be applied by Beneficiary upon any
indebtedness secured by this Deed of Trust and in any order determined by Beneficiary, or at the
option of Beneficiary the entire amount so collected or any part of that amount may be released to
Trustor. This application or release shall not cure or waive any default or notice of default under this
Deed of Trust or invalidate any act done pursuant to such a notice.
Notwithstanding the foregoing, in the event of any fIre or other casualty to the Property,
Trustor shall have the right to rebuild the Property, and to use all available insurance proceeds
therefor, provided that (a) such proceeds are sufficient to rebuild the Property in a manner that
provides adequate security to Beneficiary for repayment of the indebtedness secured hereby or ifsuch
proceeds are insufficient then Trustor shall have funded any deficiency, (b) Beneficiary shall have the
right to approve (which shall not be unreasonably withheld or delayed) plans and specifications for
any major rebuilding and the right to approve (which shall not be unreasonably withheld or delayed)
disbursements of insurance proceeds for rebuilding under a construction escrow or similar
arrangement, and (c) no material default then exists hereunder or under the Note. If the casualty
affects only part of the Property and total rebuilding is not feasible, then proceeds may be used for
partial rebuilding and partial repayment of the indebtedness secured hereby in a manner that provides
adequate security to Beneficiary for repayment of the remaining indebtedness secured hereby.
Defense of Security
(3) To appear in and defend any action or proceeding purporting to affect the security of this
Deed of Trust or the rights or powers of Beneficiary, or Trustee; and to pay all costs and expenses,
including cost of evidence of title and attorneys' fees in a reasonable sum, in any such action or
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proceeding in which Beneficiary or Trustee may appear, and in any suit brought by Beneficiary to
foreclose this Deed of Trust.
Payment of Liens and Taxes
(4) To pay, at least ten (10) days before delinquency, all taxes and assessments affecting the
Property, including assessments on appurtenant water stock, all encumbrances, charges, and liens,
with interest, on the Property or any part of the Property, which appear to be prior or superior to this
Deed of Trust; and all costs, fees, and expenses of this Trust.
If Trustor fails to make any payment or to do any act as provided in this Deed of Trust, then
Beneficiary or Trustee may (but is not obligated to) make the payment or do the act in the required
manner and to the extent deemed necessary by Beneficiary or Trustee to protect the security of this
Deed of Trust. The performance by Beneficiary or Trustee of such an act shall not require notice to
or demand upon Trustor and shall not release Trustor trom any obligation under this Deed of Trust.
Beneficiary or Trustee shall also have the following related rights and powers: to enter upon the
Property for the foregoing purposes; to appear in and defend any action or proceeding purporting to
affect the security of this Deed of Trust or the rights or powers of Beneficiary or Trustee; to pay,
purchase, contest, or compromise any encumbrance, charge, or lien that in the judgment of either
appears to be prior or superior to this Deed of Trust; to employ counsel; and to pay necessary
expenses and costs, including reasonable attorneys' fees.
Reimbursement of Costs
(5) To pay immediately and without demand all sums expended by Beneficiary or Trustee
pursuant to this Deed of Trust, with interest from date of expenditure at the amount allowed by law in
effect at the date of this Deed of Trust, and to pay any amount demanded by Beneficiary (up to the
maximum allowed by law at the time of the demand) for any statement regarding the obligation
secured by this Deed of Trust.
(6) That it will pay the City Note at the time and in the manner provided therein.
(7) That it will not permit or suffer the use of any of the Property for any purpose other than the use
for which the same was intended at the time this Deed of Trust was executed.
(8) That the Note, the Loan Agreement, Memorandum of First Right of Refusal, Affordable Housing
Agreement and the Declaration of Covenants and Restrictions are incorporated herein by reference
and made a part of this Deed of Trust, although not attached. Copies are on file in the office of the
Redevelopment Agency and Housing Authority of the City ofChula Vista.
(9) To perform, in a timely manner, each agreement and covenant by and between Trustor on any
and all notes, loans and deeds of trust that are senior and/or junior to this Deed of Trust. A default in
any of these obligations and the expiration of any applicable notice or cure period shall constitute a
default under this Deed of Trust.
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Affordable Housing Resale Restrictions
(10) To market the property for sale to households at or below one hundred and twenty percent
(120%) of the area median income in accordance with the Developer Agreement and Neighborhood
Stabilization Program (NSP) regulations.
(II) To provide the City with written notice of the eligible household and record all required
documents in compliance with the Trustees Neighborhood Stabilization First-Time Homebuyer
Program Guidelines.
B. THE PARTIES AGREE THAT:
Condemnation Award
(I) Any award of damages in connection with any taking or condemnation, or for injury to the
Property by reason of public use, or for damages for private trespass or injury to the Property, is
hereby assigned and shall be paid to Beneficiary (subject to the rights of any senior lenders), as its
interest may appear as further security for all obligations secured by this Deed of Trust. Upon receipt
of such proceeds, Beneficiary may hold the proceeds as further security, or apply or release them in
the same manner and with the same effect as provided in Paragraph A(2) of this Deed of Trust for the
disposition of proceeds of fire or other insurance.
Waiver of Late Payments
(2) By accepting payment of any sum secured by this Deed of Trust after its due date, Beneficiary
does not waive its right either to require prompt payment when due of all other sums so securedorto
declare default for failure to pay any indebtedness secured by this Deed of Trust.
Trustee's Powers
(3) Upon written request of Beneficiary and presentation of this Deed of Trust and the Note for
endorsement, Trustee may (a) reconvey all or any part of the Property; (b) consent to the making and
recording, or either, of any map or plat of all or any part of the Property; (c) join in granting any
easement on the Property; or (d) join in or consent to any extension agreement or any agreement
subordinating the lien, encumbrance, or charge of this Deed of Trust. Trustee need not provide
Trustor with notice before taking any ofthe foregoing actions, and shall not be liable for the proper
performance of the act. The exercise by Trustee of any ofthe foregoing powers shall not affect the
personal liability of any person for payment of the indebtedness secured by this Deed of Trust, or the
lien ofthis Deed of Trust on the remaining property as security for the repayment of the full amount
secured by this Deed of Trust.
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City Council Reso!ution No. 2010-_
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Full Reconveyance
(4) Upon written request of Beneficiary stating that all sums secured by this Deed of Trust have
been paid, surrender of this Deed of Trust, the Note, and any other notes secured by this Deed of
Trust to Trustee for cancellation and retention, and payment of Trustee's fees and charges, Trustee
shall reconvey, without warranty, the Property then subject to this Deed of Trust. The recitals in the
reconveyance shall be conclusive proof of the truthfulness of the recitals. The grantee in the recon-
veyance may be described as "the person or persons legally entitled thereto." Five years after
issuance of the full reconveyance, Trustee may destroy the Note and this Deed of Trust, unless
directed in the request to retain them.
Assignment of Rents
(5) As additional security, Trustor hereby gives to and confers upon Beneficiary the right, power,
and authority during the continuance of these Trusts, to collect the rents, issues, and profits of the
Property, but reserves the right, prior to any default, which shall continue beyond any applicable
notice and cure periods, by Trustor in payment of any indebtedness secured by this Deed of Trust or
in the performance of any agreement under this Deed of Trust, to collect and retain these rents,
issues, and profits as they become due and payable. Upon any such default, Beneficiary may, without
notice and without regard to the adequacy of the security for the indebtedness secured by this Deed of
Trust, either personally or by agent or court-appointed receiver, do the following: enter upon and
take possession of the Property or any part of the Property; sue for or otherwise collect all rents,
issues, and profits, including those past due and unpaid; and apply these rents, issues, and profits, less
costs and expenses of operation and collection (including reasonable attorneys' fees), upon any
indebtedness secured by this Deed of Trust, in any order determined by Beneficiary. The exercise of
the foregoing rights by Beneficiary shall not cure or waive any default or notice of default under this
Deed of Trust or invalidate any act done pursuant to such a notice.
Default in Foreclosure
(6) Upon default by Trustor in the payment of any indebtedness secured by this Deed of Trust or
in the performance of any material obligation under this Deed of Trust, and the expiration of any and
all applicable notice or cure periods, Beneficiary may declare all sums secured by this Deed of Trust
immediately due and payable by delivering to Trustee a written declaration of default and demand for
sale and a written notice of default and election to sell the Property. Trustee shall cause the notice of
default and election to sell to be recorded. Beneficiary also shall deposit with Trustee this Deed of
Trust, the Note, and all documents evidencing any additional expenditures secured by this Deed of
Trust.
After the required time period has lapsed following the recordation of the notice of default, and after
notice of sale has been given as required by law, Trustee, without demand on Trustor, shall sell the
Property at the time and place specified in the notice of sale, either as a whole or in separate parcels,
and in any order determined by Trustee, at public auction to the highest bidder for cash in lawful
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money of the United States, payable at the time of sale. Trustee may postpone sale of all or any
portion of the Property by public announcement at the time and place of sale, and ITom time to time
thereafter may postpone the sale by public announcement at the time fIxed by the preceding
postponement. Trustee shall deliver to the purchaser at the auction its deed conveying the Property
sold, but without any covenant or warranty, express or implied. The recital in the deed of any matter
or fact shall be conclusive proof of the truthfulness of the recital. Any person, including Trustor,
Trustee, or BenefIciary, may purchase at the sale.
After deducting all costs, fees, and expenses of Trustee and BenefIciary under this paragraph,
including costs of procuring evidence of title incurred in connection with sale, Trustee shall apply the
proceeds of sale to payment of: all sums expended under the terms of this Deed of Trust, not then
repaid, with accrued interest at the amount allowed by law in effect at the date of this Deed of Trust;
all other sums then secured by this Deed of Trust; and the remainder, if any, to the person or persons
legally entitled to the remaining proceeds.
(7) Should the undersigned agree to or actually sell, convey, transfer, or dispose of, or further
encumber the real property described in this deed of trust securing the Promissory Note, or any part
of it, or any interest in it, without fIrst obtaining the written consent of the Holder of the Note, then
all obligations secured by the Note and trust deed may be declared due and payable, at the option of
the Holder. Consent to one transaction of this type will not constitute a waiver ofthe right to require
consent to future or successive transactions.
General Provisions
(8) This Deed applies to, inures to the benefIt of, and binds all parties to this Deed of Trust and
their heirs, legatees, devisees, administrators, executors, successors, and assigns. The term "BenefIci-
ary" shall mean the holder and owner, including pledgee, of the Note secured by this Deed of Trust,
whether or not named as a benefIciary in this Deed of Trust, and the heirs, legatees, devisees,
administrators, executors, and assigns of any such person. In this Deed, whenever the context so
requires, the masculine gender includes the feminine and/or neuter, and the singular number includes
the plural.
Acceptance by Trustee
(9) Trustee accepts this Trust when this Deed, duly executed and acknowledged, is made a public
record as provided by law. Trustee is not obligated to notity any party to this Deed of Trust of
pending sale under any other deed of trust or of any action or proceeding in which Trustor,
BenefIciary, or Trustee shall be a party unless brought by Trustee.
Substitution of Trustees
(10) BenefIciary, or any successor in ownership of any indebtedness secured by this Deed of Trust,
may ITom time to time, by written instrument, substitute a successor or successors to any Trustee
named in or acting under this Deed of Trust. The substitution instrument shall contain the name of
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the original Trustor, Trustee, and Beneficiary under this Deed of Trust, the book and page where this
Deed is recorded, and the name and address of the new Trustee. When executed by Beneficiary and
duly acknowledged and recorded in the office of the recorder of the county or counties where the
Property is situated, the substitution instrument shall be cO)1clusive proof of proper substitution of the
successor Trustee or Trustees. Any successor Trustee or Trustees shall, without conveyance from
the predecessor Trustee, succeed to all its title, estate, rights, powers, and duties.
Cumulative Powers and Remedies
(II) The powers and remedies conferred in this Deed of Trust are concurrent and cumulative to all
other rights and remedies provided in this Deed of Trust or given by law. These powers and remedies
may be exercised singly, successively, or together, and as often as deemed necessary.
Conclusiveness of Recitals
(12) The recitals contained in any reconveyance, trustee's deed, or any other instrument executed
by Trustee from time to time under the authority of this Deed of Trust or in the exercise of its powers
or the performance of its duties under this Deed of Trust, shall be conclusive evidence of their truth,
whether stated as specific and particular facts, or in general statements or conclusions. Further, the
recitals shall be binding and conclusive upon Trustor, its heirs, executors, administrators, successors,
and assigns, and all other persons.
Attorneys' Fees
(13) If any action is brought for the foreclosure of this Deed of Trust or for the enforcement of any
provision of this Deed of Trust (whether or not suit is filed), Trustor agrees to pay all costs and
expenses of Beneficiary and Trustee, including reasonable attorneys' fees; and these sums shall be
secured by this Deed of Trust.
Co-trustees
(14) [ftwo or more persons are designated as Trustee in this Deed of Trust, any, or all, power
granted in this Deed of Trust to Trustee may be exercised by any of those persons, ifthe other person
or persons are unable, for any reason, to act. Any recital of this inability in any instrument executed
by any of those persons shall be conclusive against Trustor and Trustor's heirs and assigns.
Request for Notices of Default and Sale
(15) [n accordance with Section 2924b of the California Civil Code, request is hereby made that a
copy of any Notice of Default and a copy of any Notice of Sale under any Deeds of Trust executed by
Trustor, and recorded in the Official Records of San Diego County, California, in which Beneficiary,
is named as beneficiary, be mailed to:
Beneficiary:
City ofChula Vista
276 Fourth Avenue
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Chula Vista, CA 91910
Attention: Director of Redevelopment and Housing
If to Trustor:
Community HousingWorks
4345 University Avenue, Suite 550
San Diego, CA 92105
Attention: Susan M. Reynolds
NOTICE: A copy of any notice of default and of any notice of sale will be sent only to the
address contained in this recorded request. If your address changes, a new request must be
recorded.
The undersigned Trustor requests that a copy of any notice of default and of any notice of sale under
this Deed of Trust be mailed to Trustor at the address of Trustor set forth above.
(16) Trustor shall permit Beneficiary and its agents or representatives, to inspect the Property at
any and all reasonable times, upon prior written notice of not less than twenty-four (24) hours (unless
Trustor is in default under any of the Loan Documents). Inspections shall be conducted so as not to
interfere with the tenants' use and enjoyment of the Property and the general operation of the
Property.
(17) The City Loan provided for herein shall be subject to the restrictions set forth in the Loan
Agreement and Declaration of Covenants and Restrictions and Trustor hereby consents to such
restrictions and agrees to be bound thereby. Such restrictions shall be in addition to and not in
limitation of the rights of Beneficiary expressly set forth in this Deed of Trust.
(18) For purposes of this Deed of Trust, "Hazardous Materials" mean and include any hazardous,
toxic or dangerous waste, substance or material including, without limitation, flammable explosives,
radioactive materials, asbestos, hazardous wastes, toxic substances and any materials or substances
defmed as hazardous materials, hazardous substances or toxic substances in (or for purposes of) the
Comprehensive Environmental Response, Compensation and Liability Act of 1980 ("CERCLA"), as
amended (42 U.S.c. 99601, et seq.), the Hazardous Materials Transportation Act (49 U.S.C. 91801,
et seq.), the Resource Conservation and Recovery Act (42 U.S.c. 96901, et seq.), and those
substances defmed as hazardous wastes in 925117 of the California Health and Safety Code or as
hazardous substances in 925316 of the California Health and Safety Code or in any regulations
promulgated under either such law, any so-called "Superfund" or "Superlien" law, or any other
federal, state or local statute, law, ordinance, code, rule, regulation, order or decree regulating,
relating to, or imposing liability or standards of conduct concerning, any hazardous, toxic or
dangerous waste, substance or material, as now or at any time hereafter in effect.
(19) In addition to the general and specific representations, covenants and warranties set forth in
the Deed of Trust or otherwise, Trustor represents, covenants and warrants, with respect to
Hazardous Materials, as follows:
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(a) Neither Trustor nor, to the best knowledge of Trustor, any other person, has ever
caused or permitted any Hazardous Materials to be manufactured, placed, held, located or disposed
of on, under or at the Property or any part thereof, and neither the Property nor any part thereof, or
any property adjacent thereto, has ever been used (whether by Trustor or, to the best knowledge of
Trustor, by any other person) as a manufacturing site, dump site or storage site (whether permanent
or temporary) for any Hazardous Materials. "Hazardous Materials" for purposes of this Paragraph
19(a) shall not include substances typically used in the ordinary course of developing, operating and
maintaining apartment complexes, provided that such substances are used in accordance with all
applicable laws.
(b) Trustor hereby agrees to indemnifY Beneficiary, its officers, employees, contractors
and agents, and hold Beneficiary, its officers, employees, contractors and agents harmless trom and
against any and all losses, liabilities, damages, injuries, costs, expenses and claims of any and every
kind whatsoever paid, incurred or suffered by, or asserted against Beneficiary, its officers, employees,
contractors or agents for, with respect to, or as a direct or indirect result of, the presence or use,
generation, storage, release, threatened release or disposal of Hazardous Materials on or under the
Property or the escape, seepage, leakage, spillage, discharge, emission or release of any Hazardous
Materials trom the Property (including, without limitation, any losses, liabilities, damages, injuries,
costs, expenses or claims asserted or arising under CERCLA, any so-called "Superfund" or
"Superlien" law, or any other federal, state or local statute, law, ordinance, code, rule, regulation,
order or decree regulating, relating to or imposing liability or standards of conduct concerning any
Hazardous Materials) regardless of whether or not caused by or within the control of Trustor. The
foregoing indemnification shall not apply to any liability resulting trom (i) an event that occurs after a
transfer of the Property due to any foreclosure sale (judicial or nonjudicial) or a deed in lieu of
foreclosure, or (ii) acts or omissions of Beneficiary or its agents.
(c) Trustor has not received any notice of (i) the happening of any event involving the use,
spillage, discharge, or cleanup of any Hazardous Materials ("Hazardous Discharge") affecting Trustor
or the Property or (ii) any complaint, order, citation or notice with regard to air emissions, water
discharges, noise emissions or any other environmental, health or safety matter affecting Trustor or
the Property ("Environmental Comp]aint") trom any person or entity, including, without limitation,
the United States Environmental Protection Agency ("EP A"). If Trustor receives any such notice
after the date hereof, then Trustor will give, within seven (7) business days thereafter, oral and written
notice of same to Beneficiary.
(d) Without limitation of Beneficiary's rights under this Deed of Trust, Beneficiary shall
have the right, but not the obligation, to enter onto the Property or to take such other actions as it
deems necessary or advisable to clean up, remove, resolve or minimize the impact of, or otherwise
deal with, any such Hazardous Materials or Environmental Complaint upon its receipt of any notice
trom any person or entity, including without limitation, the EP A, asserting the existence of any
Hazardous Materials or an Environmenta] Complaint on or pertaining to the Property which, if true,
could result in an order, suit or other action against Trustor affecting any part of the Property by any
governmental agency or otherwise which, in the sole opinion of Beneficiary, could jeopardize its
security under this Deed of Trust. All reasonable costs and expenses incurred by Beneficiary in the
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exercise of any such rights shall be secured by this Deed of Trust and shall be payable by Trustor
upon demand together with interest thereon at a rate equal to the highest rate payable under the note
secured hereby.
(e) The foregoing representation, covenants, indemnities and warranties shall be
continuing and shall be true and correct for the period ITom the date hereofto the release ofthis Deed
of Trust (whether by payment of the indebtedness secured hereby or foreclosure or action in lieu
thereof), and these representations, covenants, indemnities and warranties shall survive such release.
(20) Each successor owner of an interest in the Property other than through foreclosure or deed in
lieu of foreclosure of an interest superior to this Deed of Trust, shall take its interest subject to this
Deed of Trust.
(21) This Deed of Trust shall be governed by and construed in accordance with the laws of the
State of California.
(22) If the Property is allocated to a low-income housing tax credits under the provisions of
sections 17058 and 23610.5 ofthe Revenue and Taxation Code of State of California and under the
Section 42 ofthe Internal Revenue Code of 1986, as amended ("Code") then the Property will be
subject to certain requirements of Section 42 of the Code, including, but not limited to Section
42(h)(6)(e)(ii), which does not permit the eviction or termination oftenancy (other than for good
cause) of an existing tenant of any low-income unit or any increase in the gross rent with respect to
such unit not otherwise permitted under Section 42 for a period of three (3) years after the date the
Property is acquired by foreclosure or deed in lieu of foreclosure. Beneficiary acknowledges the
provisions of Section 42 of the Code and agrees that, if and to the extent applicable to Beneficiary in
connection with the Property, Beneficiary will comply therewith.
Recourse Durin!! Construction and Non-Recourse After Filin!! of Certificate of Completion.
(23) Following the timely completion ofthe construction of the Project, as defined in the Loan
Agreement, measured by the timely filing of a Certificate of Completion, nothing herein contained
shall be deemed to cause Trustor (or any of its partners, or any of their respective directors, officers,
employees, partners, principals or members) personally to be liable to payor perform any of its
obligations evidenced hereby, and the Beneficiary shall not seek any personal or deficiency judgment
on such obligations, and the sole remedy of the Beneficiary with respect to the repayment of the loan
evidenced by this Note shall be against the Property; provided, however, that the foregoing shall not
in any way affect any rights the Beneficiary may have (as a secured party or otherwise) hereunder or
under this Deed of Trust, or any other rights the Beneficiary may have to: (a) recover directly ITom
the Trustor any funds, damages or costs (including, without limitation, reasonable attorneys' fees and
costs) incurred by the Beneficiary as a result of fraud, intentional misrepresentation or intentional
waste by Trustor; or (b) recover directly ITom the Trustor any condemnation or insurance proceeds,
or other similar funds or payments attributable to the Property which under the terms of this Deed of
Trust should have been paid to the Beneficiary, and any costs and expenses incurred by the
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Beneficiary in connection therewith (including, without limitation, reasonable attorneys' fees and
costs).
(24) All individuals signing this Deed of Trust for a party which is a corporation, a partnership or
other legal entity, or signing under a power of attorney, or as a trustee, guardian, conservator, or in
any other legal capacity, covenant to the Beneficiary that they have the necessary capacity and
authority to act for, sign and bind the respective entity or principal on whose behalf they are signing.
(25) This Deed of Trust is subordinate and subject to the Deed of Trust and Assignment of Rents
dated as of , executed by Trustor for the benefit of
(the" Beneficiary") and recorded concurrently herewith, and the rights hereunder are otherwise
subject to the terms and conditions of that certain Subordination Agreement recorded concurrently
herewith and executed by the Trustor, and the Beneficiary, the City of Chula Vista.
[Signature Pages to Follow]
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COMMUNITY HOUSINGWORKS, a California Non-Profit
By:
Susan M. Reynolds, President & Chief Executive Officer
CITY OF CHULA VISTA
By:
James D. Sandoval, City Manager
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REQUEST FOR FULL RECONVEYANCE
To be used ouly when note has been paid
Dated
TO
, Trustee:
The undersigned is the legal owner and holder of all indebtedness secured by the within
Deed of Trust. All sums secured by said Deed of Trust have been fully paid and satisfied; and you
are hereby requested and directed, on payment to you of any sums owing to you under the terms
of said Deed of Trust, to cancel all evidences of indebtedness, secured by said Deed of Trust,
delivered to you herewith together with the said Deed of Trust, and to reconvey, without
warranty, to the parties designated by the terms of said Deed of Trust, the estate now held by you
under the same.
By
By
By
By
MAIL RECONVEYANCE TO:
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ACKNOWLEDGMENT
State of California )
)
County of San Diego )
On , 200_, before me, personally appeared,
personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies),
and that by his/her/their signature(s) on the instrument the person(s), or the entity on behalf of which
the person(s) acted, executed the instrument.
WITNESS my hand and official seal.
Signature
(Seal)
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ACKNOWLEDGMENT
STATE OF CALIFORNIA )
) S.S.
COUNTY OF SAN DIEGO )
On , 20_ before me, Donna Norris, City Clerk, personally appeared
, who proved to me on the basis of satisfactory evidence to be the person
whose name is subscribed to the within instrument and acknowledged to me that he executed the
same in his authorized capacity, and that by his signature on the instrument, the person, or the entity
upon behalf of which the person acted, executed the instrument.
I certifY under PENALTY OF PERJURY under the laws ofthe State of California that the foregoing
paragraph is true and correct
WITNESS my hand and official seal
Donna Norris, CMC
City Clerk of the City ofChula Vista
(SEAL)
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Exhibit "A"
Legal Description
All that certain real property situated in the City of Chula Vista, County of San Diego, State of
California, described as follows:
INSERT LEGAL DESCRIPTION
APN:
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EXHIBIT 2
DO NOT DESTROY THIS NOTE: WHEN PAID, THIS NOTE AND THE DEED OF TRUST
SECURING IT MUST BE SURRENDERED TO TRUSTEE FOR CANCELLATION
BEFORE RECONVEYANCE WILL BE MADE.
----------------------------------------------------------------------------------------------------------------
NOTE SECURED BY DEED OF TRUST
("Note")
San Diego, California
Month Day, 2010
I. PrinciDal and Interest.
FOR VALUE RECEIVED, and in consideration of the Neighborhood Stabilization Program (NSP)
Developer Agreement, dated March 24, 20 I 0 (the "Agreement"), made by the City of Chula Vista, a
public body, corporate and politic ("City" and "Holder") and Community HousingWorks, A California
Non-Profit Organization ("Maker") promises to pay to City, or order, at 276 Fourth Avenue, Chula
Vista, California 919! 0, the sum of Dollars (U.S. $ ) (the "NSP Loan"),
at the rate of zero percent (0%) per annum, pursuant to the terms of the NSP Developer Agreement,
dated , for acquisition, rehabilitation and disposition of the "Assisted Unit" at
2. Affordable Housin!! Resale Restriction.
This Promissory Note (the "Promissory Note" or "Note") is made and delivered pursuant to and in
implementation of the Developer Agreement by and between the Holder and the Maker dated March
24, 20 I 0 (the "Restriction"), a copy of which is on file as a public record with the Holder and is
incorporated herein by reference. Unless de[mitions ofterms have been expressly set out at length
herein, each term shall have the same de[mition as set forth in the Restriction.
3. Acceleration UDOn Default.
In the event of any default under the terms of this Note after the expiration of all applicable cure
periods, as set forth in the Loan Agreement, of the Deed of Trust or security agreement securing this
Note, or of the Loan Agreement, or any prior or subsequent loans, notes and/or deed of trust, at the
option of the holder of this Note, and after written notice to Maker, with thirty (30) days in which to
cure any default, all principal and interest due under this Note and the Note shall immediately become
due and payable, without further notice. Failure to exercise such option shall not constitute a waiver of
the right to exercise it in the event of any subsequent default. Without limiting any other events of
default contained herein, or in any of the Loan Documents, the failure to complete rehabilitation of the
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Project within a reasonable period of time shall be considered an event of default, entitling the City to
accelerate the payment of principal and interest hereunder, as provided in this Section 3.
4. Loan Terms.
The NSP Loan will accrue interest at a rate ofzero percent (0%) per annum. The NSP Loan shall
be due and payable on the earliest of: (a) the date the Assisted Unit is sold; or (b) an Event of
Default by Trustor which has not been cured as provided for in the Note. Notwithstanding the
above, it is intended that the full amount of the NSP Loan for the Assisted Unit will be reduced by
the following:
(a) Homebuyer Subsidy. The Homebuyer Subsidy is the amount of the Selling Price minus the
principal balance of the Qualified Homebuyer's (households at or below one hundred and
twenty percent (120%) of the area median income) home loan (the "Homebuyer Loan").
The Homebuyer Subsidy is limited to forty percent (40%) of the Selling Price and capped
for a maximum amount of$70,000. The Homebuyer Subsidy is an amount assumed in the
form of silent second mortgage assistance to Qualified Homebuyer in compliance with the
Neighborhood Stabilization First-Time Homebuyer Program Guidelines; and
(b) Closing Costs. Closing Costs for the sale of the Assisted Unit to Qualified Homebuyer.
The NSP Loan, less the sum of the Homebuyer Subsidy and Closing Costs shall be repaid to
Trustee upon the sale of the Assisted Unit. Upon the repayment of the NSP Loan, Trustee shall
be released /Tom its repayment obligations. At the time of the sale of the Assisted Unit to
Qualified Homebuyer, Trustee shall cause to be delivered to Trustor a reconveyance of the Deed
of Trust /Tom such Assisted Unit and a termination of the Agreement as a lien on such Assisted
Unit.
Upon transfer of title to the Qualified Homebuyer, a "Homebuyer Deed of Trust" and
"Homeowner's Regulatory Agreement for Neighborhood Stabilization Program Participation"
shall be recorded to secure the Homebuyer Subsidy ("Second Mortgage Loan"), and to require its
repayment if the Assisted Unit is no longer the principal residence and upon sale, rental, refmance,
conveyance, transfer or change in title of the Assisted Unit prior to the expiration of the
affordability period.
Sale, rental, ref mance, conveyance, transfer or change in title of the Assisted Unit prior to the
expiration of the affordability period will cause the shared equity in addition to the principal as
provided in the Homebuyer Deed of Trust.
Pursuant to the NSP Developer Agreement, the term of the NSP Note shall be twelve months
(12) /Tom the Effective Date.
Should the undersigned sell, convey, transfer, further encumber, or dispose of the Property described in
the Deed of Trust securing this Note, or any part of it, or any interest in it, without first obtaining the
written consent of City, or the then holder of this Note, then all obligations secured by this Note may be
declared due and payable, at the option of City, or the then holder of this Note. City reserves the right
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to approve all sales, transfers, conveyances, additional encumbrances, or dispositions of the real
property which approval shall not be unreasonably withheld or delayed. Consent to one transaction of
this type will not constitute a waiver of the right to require consent to future or successive transactions.
5. Security for Note.
This Promissory Note is secured by a Deed of Trust of even date herewith, executed by Maker as
Trustor in favor of Holder as Beneficiary and Trustee.
6. Attornevs' Fees and Costs.
In the event that any action is instituted to enforce payment under this Promissory Note, the parties
agree that the non-prevailing party shall be responsible for and shall pay to the prevailing party all court
costs and all attorneys' fees incurred in enforcing this Note.
7. Amendments.
This Note may not be modified or amended except by an instrument in writing expressing such intention
executed by the parties sought to be bound thereby, which writing must be so firmly attached to this Note
so as to become a permanent part thereof.
8. Maker's Waivers.
Maker waives any rights to require the Holder to: (a) demand payment of amounts due (known as
"presentment"), (b) give notice that amounts due have not been paid (known as "notice of dishonor"), and
(c) obtain an official certification of nonpayment (known as "protest").
8. Notice.
Any notice that must be given to Maker under this Note shall be given by personal delivery or by
mailing it by certified mail addressed to Maker at the Property address above or such other address as
Maker shall direct ITom time to time in writing. Failure or delay in giving any notice required hereunder
shall not constitute a waiver of any default or late payment, nor shall it change the time for any default
or payment. Any notice to Holder shall be given by certified mail at Holder's address stated in the
preamble to this Note.
9. Successors Bound.
This Promissory Note shall be binding upon the parties hereto and their respective heirs, successors
and assigns.
10. CatastroDhic Event.
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In the event of a catastrophic event, which requires the sale of the Property, the Maker shall give
written notice to the City, which notice shall initiate the obligations of the City under the terms of the
Restriction to seek an Eligible Purchaser.
[Signature Page to Follow]
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Maker:
COMMUNITY HOUSINGWORKS
a California non-profit organization
By:
Susan M. Reynolds, President &, Chief Executive Officer
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Legal Description
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Exhibit "A"
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