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HomeMy WebLinkAboutCD 1700 Fourth Street BMR AgreP a°0 RECORDING REQUESTED By and WHEN RECORDED MAIL TO: City of San Rafael Attn: City Clerk 1400 Fifth Avenue San Rafael, Ca 94901 No fee for recording pursuant to Government Code Section 27383 II IIIlIIIIlillllllllliillllllllillllllll til 2017-0021533 Recorded I REC FEE Official Records I County of I Harin I RICHARD II. BENSON I Assessor -Recorder I County Clerk I I 02:20PIl 30-Ifay-2017 I Page 1 of 27 REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS (Below Market Rate Rental Unit Agreement with No Condominium Map; Density Bonus Law) Development Name: G Square Location: 1700 Fourth Street, San Rafael (APN 011-192-07) Developer: G Square Partners, LLC and LRT Investment, LLC This Regulatory Agreement and Declaration of Restrictive Covenants (the "Agreement") is made and entered into this day of� , a 0/7, among the CITY OF SAN RAFAEL, a municipal corporation ("City"); 11), the IIOUSING AUTHORITY OF THE COUNTY OF MARIN, a public body, corporate and politic, created under the Housing Authority Law of the State of California ("Marin Housing Authority"); and G SQUARE PARTNERS, LLC a California limited liability company, and LRT Investment, LLC, a California limited liability company or any of their successors in interest (collectively the "Developer"), collectively the "Parties". RECITALS A. The City has adopted a density bonus ordinance (Section 14.16.030.1-1 of the San Rafael Municipal Code) (the "Density Bonus Ordinance") to conform with state density bonus law (Government Code Sections 65915 65918) (together "Density Bonus Law"). Density Bonus Law allows a density bonus, concessions, and other regulatory incentives when a developer proposes to provide rental housing affordable to Very Low Income or Low Income Households, as defined below. B. Developer is the owner of certain real property located at 1700 Fourth Street, San Rafael, County of Marin, California, which is more particularly described in attached Exhibit A incorporated herein by this reference (the "Property"). In consideration of certain valuable land use and economic benefits conferred by the City upon the Property under Density Bonus Law, Developer, for itself, its successors, heirs, grantees and assigns, hereby agrees to comply with the requirements of Density Bonus Law as applied to the Property. C. On December 9, 2014 Developer received the following discretionary approvals from the City: Environmental and Design Permit (ED 14-068) and Use Permit (UPI4-020)(the "Project Approvals") to construct a mixed use development of total of ten dwelling units ("Units"), (hereinafter referred to as the "Development"). As part of the Development, Developer has sought and agreed to construct one Unit(s) (10% 885 01\2049494.3 3.9 2017 0.00 of the total Units in the Development) to be affordable to a Very Low Income Household (the "Affordable Unit") for the Density Bonus Tenn as defined below. D. Under Density Bonus Law, Developer has applied for, and the City has granted, the following regulatory incentives in exchange for the Developer's provision of the Affordable Unit: (i) A density bonus of three (3) additional Units (the "Density Bonus"). (ii) Concession(s), described as follows: (the "Concession(s)"). a) A height bonus of six feet b) A parking concession pursuant to Density Bonus Law to allow tandem parking for two residential parking spaces as parallel spaces along the entry driveway off G Street (the "Parking Reduction"): Any Density Bonus, Concession(s), Waiver(s), or Parking Reduction incorporated into the Development are collectively "Incentives." E. Density Bonus Law requires the City to ensure, and the Developer to agree to, continued affordability of the Affordable Unit for the Density Bonus Tenn. To ensure their continued affordability for the Density Bonus Term, this Agreement shall be executed and recorded against the Property prior to issuance of any building pen -nits for the Development. F. Developer acknowledges and agrees that the Project Approvals provided adequate and proper notice pursuant to Government Code Section 66020 of Developer's right to protest any requirements for fees, dedications, reservations, and other exactions as may be included in this Agreement, that no protest in compliance with Section 66020 was made within ninety (90) days of the date that notice was given, and that the period has expired in which Developer may protest any and all fees, dedications, reservations, and other exactions as may be included in this Agreement. G. Marin Housing Authority is authorized by law to participate in programs that provide housing for households of very low, low, and moderate income. The City has contracted with Marin Housing Authority to administer the City's affordable housing program. NOW THEREFORE, it is hereby agreed by and between the Parties hereto as follows: AGREEMENT The Parties agree and acknowledge that the above recitals are true and accurate, and are incorporated into this Agreement by this reference. 1. Definitions and Exhibits 1.1 Definitions. In addition to those terms defined in the Recitals and in other sections of this Agreement, the following terms are specially defined for the purposes of this Agreement: A. "Affordable Rent" is the maximum allowable Rent for an Affordable Unit that does not exceed: (i) for Very Low Income Households, is equal to or less than one -twelfth (1/12) of thirty percent 885\01\2049494.3 3/9/2017 (30%) of fifty percent (50%) of Area Median Income, as adjusted for Assumed Household Size; (ii) for Low Income Households, is equal to or less than one -twelfth (1/12) of thirty percent (30%) of sixty percent (60%) of Area Median Income; and (iii) for Median Income Households, is equal to or less than one -twelfth (1/12) of thirty percent (30%) of one hundred percent (100%) of Area Median Income, as adjusted for Assumed Household Size. Affordable Rent cannot exceed the rent for Market Rate Units. An example of the calculations and methodology to be used to determine the Affordable Rent is illustrated in Exhibit B attached hereto. B. "Area Median Income" means median yearly income in Marin County as published pursuant to California Code of Regulations, Title 25, Section 6932, or successor provision. C. "Assumed Household Size" shall be based on presumed maximum occupancy levels of one person in a studio apartment, two (2) persons in a one -bedroom unit, three (3) persons in a two-bedroom unit, and one additional person for each additional bedroom thereafter. D. "Density Bonus Term" is the period that commences when the City, Marin Housing Authority, and the Developer record the Regulatory Certificate described in Section 5 and that tenninates fifty- five (55) years after the date of the recordation of the Regulatory Certificate. E. "Eligible Household" is a household which has been detennined to be eligible to rent an Affordable Unit in compliance with Density Bonus Law and this Agreement. F. "Household Income" is the combined, gross, pre-tax income of all occupants of the applicant household, including the income of any co -signors on the lease. G. "Low Income Affordable Unit" means an Affordable Unit reserved for occupancy by Low Income Households at an Affordable Rent. H. "Low Income Household" means a household whose Household Income does not exceed the lower income limits applicable to Marin County, adjusted for household size, as published annually by the California Department of Housing and Community Development; generally a household with a Household Income between fifty percent (50%) and eighty percent (80%) of Area Median Income, adjusted for actual household size. 1. "Market Rate Units" are Units which are not Affordable Units. J. "Median Income Household" means a household whose Household Income does not exceed the Area Median Income applicable to Marin County, adjusted for household size, as published annually by the California Department of Housing and Community Development; generally a household with a Household Income between eighty percent (80%) and one hundred percent (100%) of Area Median Income, adjusted for actual household size. K. "Rent" is the total of monthly payments as calculated by the Marin Housing Authority and paid by the Tenant of an Affordable Unit for all of the following: (1) use and occupancy of the Affordable Unit and land and all facilities associated with the Affordable Unit, including but not limited to parking, bicycle storage, storage lockers, and use of all common areas; (2) any separately charged fees or service charges assessed by the Developer which are required of all tenants of Units in the Project, except security deposits; (3) an allowance for utilities paid by the Tenant as established by the Marin Housing Authority, 88101\2049494.3 3/9/2017 including garbage collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuel, but not telephone service or cable TV; and (4) any other interest, taxes, fees or charges for use of the land or associated facilities that are assessed by a public or private entity other than the Developer and paid by the Tenant. L. "Tenant" is a household occupying an Affordable Unit pursuant to a valid lease or rental agreement with the Developer. M. "Tenant Lease" is defined in Section 3.4. N. "Very Low Income Household" means a household whose Household Income does not exceed the very low income limits applicable to Marin County, adjusted for household size, as published annually by the California Department of Housing and Community Development; generally a household with a Household Income at or below fifty percent (50%) of Area Median Income. O. "Very Low Income Affordable Unit" means an Affordable Unit reserved for rent by Very Low -Income Households at an Affordable Rent. 1.2 Exhibits. The following exhibits are attached to and incorporated into this Agreement: Exhibit A Legal Description of the Property. Exhibit B Unit Description and Sample Calculation of Affordable Rent. Exhibit C Household Income Certification. Exhibit D Certificate of Continuing Compliance. Exhibit E Notice of Commencement of Density Bonus Term 2. Construction of Development and Affordable Unit 2.1 Satisfaction of Affordable Housine Reauirement. The Affordable Housing Requirements shall be satisfied with respect to the Property if. (a) the Developer constructs or causes to be constructed the Affordable Unit and (b) Developer offers all dwelling units in the Development for rent and rents the Affordable Unit to an Eligible Household in compliance with Section 3 below. 2.2 Affordable Unit. To satisfy Developer's affordable housing requirements for the Development under Density Bonus Law and the Density Bonus Ordinance, at initial occupancy of the Development, Developer shall rent one (l) Affordable Unit to a Very Low Income Household at Affordable Rents, as specified in Section 3 below, for the Density Bonus Term. 2.3 Location of Affordable Unit. The Affordable Unit shall be constructed on the Property in the location(s) shown or described in Exhibit B attached hereto. 2.4 Aupearance, Size, Bedroom Count and Tenure. A. Appearance and Maintenance of Affordable Unit. The design, square footage, appearance, and general quality of the Affordable Unit shall be compatible with those of the Market Rate Units and consistent with the designs provided for the Project Approvals. Developer shall allocate and assign parking spaces, bicycle storage, storage lockers, and other spaces reserved for use by individual Units to the Affordable Unit on the same basis as for the Market -Rate Units, and Tenants of the Affordable Unit shall have equal 4 885101\2049494.3 3/9/2017 access to the Development's common areas as is given to the residents of the Market -Rate Units, but any fee charged for use of common areas or for spaces reserved for individual Units shall be included in the Tenant's Rent. Once completed, the Affordable Unit shall not be kept vacant or used for any purpose except for residential use and shall be marketed concurrently with the Market -Rate Units and offered for rent to Eligible Households at Affordable Rents. B. Location and Characteristics of Affordable Unit. Developer shall provide the Affordable Unit in the Development in accordance with the schedule shown in Exhibit B. As provided in Exhibit B, the Affordable Unit shall be dispersed within the Development with a bedroom mix equivalent to the bedroom mix of the Market -Rate Units, except that the Developer may elect to provide the Affordable Unit with more bedrooms. C. Chance in Location of Affordable Unit. If, after recordation of this Agreement, Developer desires to change the location of any Affordable Unit within the Development, Developer shall submit a written request for such change to the Director, who may approve such request provided that any relocated Affordable Unit shall be comparable to those listed in Exhibit B and shall contain the same number of bedrooms. 2.5 Schedule for Developing Affordable Unit. Developer shall provide the Affordable Unit pursuant to the following schedule: A. Prior to issuance of any building permit for the Development, this Agreement shall be duly executed by the City, Marin Housing Authority, and the Developer and recorded against the Property. B. Building permits for the Affordable Unit shall be issued concurrently with building pen -nits for the Market Rate Units, such that, of the units that have been issued building permits, at least ten percent (10%) shall be Affordable Units. C. Certificates of occupancy or final inspections for the Affordable Unit shall be issued concurrently with certificates of occupancy or final inspections for the Market Rate Units, such that, of the units that have been issued certificates of occupancy or final inspections, at least ten percent (10%) shall be Affordable Units. 3. Rent Reeulatory Provisions The provisions of this Section 3 are applicable until the expiration of the Density Bonus Term. 3.1 Affordabilitv and Occupancv Covenants. A. Occuvancv Reauirements. Subject to the provisions of Section 3.2 below, the Affordable Unit shall be rented to and occupied by or, if vacant, available for occupancy by, a Very Low Income Household. The Affordable Unit shall not be kept vacant or used for any purpose except for residential use and, when vacant, shall be offered for rent to Eligible Households at Affordable Rent. B. Allowable Rent. Subject to the provisions of Section 3.2 below, the maximum Rent charged to Tenants of the Affordable Unit shall not exceed Affordable Rent. 885\01\2049494.3 3/9/2017 C. Avi)roval of Rents. Initial Rent for tine Affordable Unit shall be approved by the Marin Housing Authority prior to occupancy at tine time the Developer submits the marketing plan required by Section 4.2 below. Marin Housing Authority shall review all proposed Rent increases to determine whether the proposed increases are consistent with the provisions of this Agreement. Developer shall certify to Marin Housing Authority that Developer is not charging any fee other than Affordable Rent to Tenants of the Affordable Unit for all of the components of Rent defined in Section 1.1 above. D. Schedule of Affordable Rents. The City has provided the Developer with a schedule of Affordable Rents for the Affordable Unit in effect on the date of this Agreement, set forth in attached Exhibit B. Marin Housing Authority annually determines Affordable Rents (including utility allowances) based on changes in Area Median Income and utility allowances, and Developer shall obtain a copy of the schedule from Marin Housing Authority. 3.2 Increased Income of Tenants. A. Increase from Very Low Income to at or below Low Income. If, upon annual recertification of a Tenant's Household Income, the Developer determines that a former Very Low Income Household's Income has increased and exceeds the qualifying income for a Very Low Income Household, but does not exceed the qualifying limit for a Low Income Household, then, upon expiration of the Tenant's lease and after thirty (30) days written notice to the Tenant, the Tenant's rent may be increased to Affordable Rent for Low Income Households. B. Increase from Very Low Income or Low Income to at or below Median Income. If, upon annual recertification of a Tenant's Household Income, tine Developer determines that a former Very Low Income or Low Income Household's Income has increased and exceeds the qualifying income for a Very Low Income or Low Income Household, but does not exceed the qualifying limit for a Median Income Household, then, upon expiration of the Tenant's lease and after thirty (30) days written notice to the Tenant, the Tenant's rent may be increased to Affordable Rent for Median Income Households. C. Increase from Very Low Income. Low Income. or Median Income to Above Area Median Income. If, upon recertification of a Tenant's Household Income, the Developer determines that the Tenant's Household Income has increased and exceeds the qualifying income for a Median Income Household, then the Tenant shall be given written notice that: (i) Tenant's Rent shall be increased sixty (60) days after tine date in the notice to an amount to be detennined by Developer but not to exceed Rent for a comparable Market -Rate Unit; and (ii) Tenant shall vacate the Affordable Unit six (6) months from the date of the notice or upon expiration of the Tenant's lease, whichever is later. If, prior to the date by which the Tenant must vacate the Affordable Unit, another Unit is vacated which is not designated as an Affordable Unit and is of appropriate bedroom size, the Developer may, at the Developer's option, request the City to approve a change in the location of the Affordable Unit; allow the Tenant to remain in the original Unit; and designate the newly vacated Unit as an Affordable Unit if approved by the City. 3.3 Agreement to Limitation on Rents. The Development has received Incentives from the City under the Density Bonus Law and the Density Bonus Ordinance, which is a form of assistance specified in Chapter 4.3 (commencing with Section 65915) of Division 1 of Title 7 of the Government Code. Sections 1954.52(b) and 1954.53(a)(2) of the Costa -Hawkins Act provide that, where a developer has received such assistance, certain provisions of the Costa -Hawkins Act do not apply if a developer has so agreed by contract. Tine Developer hereby agrees to limit Rents as provided in this Agreement in consideration of the Developer's receipt of the Incentives and further agrees that any limitations on Rents imposed on the Affordable Unit are in 6 885\01\2049494.3 3/9/2017 conformance with the Costa -Hawkins Act. The Developer further warrants and covenants that the ten -ns of this Agreement are fully enforceable. 3.4 Lease Provisions. Tile Developer shall use a form of Tenant lease (the "Tenant Lease") approved by the City for t13e Affordable Unit. The City shall not withhold approval from any form that: A. provides that the Tenant's Household Income is subject to annual certification; B. provides for termination of the lease for failure: (1) to provide any information required under this Agreement or reasonably requested by the Developer to establish or recertify the Tenant's qualification, or the qualification of the Tenant's household, as an Eligible Household in accordance with this Agreement, or (2) to qualify as an Eligible Household as a result of any material misrepresentation made by such Tenant with respect to the Household Income computation or certification; C. provides that t13e Rent may not be raised more often than once every twelve (12) months. The Developer will provide each Tenant with at least sixty (60) days written notice of any increase in Rent applicable to such Tenant; D. prohibits subleasing of the Affordable Unit or any portion of the Affordable Unit or any spaces reserved for the use of the Tenant, contain nondiscrimination provisions, and includes the Tenant's obligation to inform the Developer of any need for maintenance or repair; E. includes reasonable rules of conduct consistent with California law; F. allows termination of the tenancy only for an increase in Tenant's Household Income above qualifying income for Low Income Households or for good cause, including violation of the terms and conditions of the Tenant Lease, violations of applicable federal, state, or local law, or other good cause; G. includes at Developer's option, the obligation for Tenant to provide a security deposit not exceeding one months' rent. 4. Marketing, Income Certification, Renortiniz, and Annual Fee. 4.1 ReaUired Citv Auorovals. At least ninety (90) days before any Units in the Development receive a final inspection or certificate of occupancy, the Developer shall notify City and the Marin Housing Authority of the availability of the Affordable Unit and provide to the City and Marin Housing its proposed marketing plan for the Affordable Unit as described below; the proposed form of Tenant Lease to confirm conformance with the provisions of Section 3.4 above; and proposed Affordable Rent for the Affordable Unit, all for City and Marin Housing Authority review and approval. The Affordable Unit shall be marketed concurrently with the marketing of the Market -Rate Units. 4.2 Marketing Plan. The Developer's marketing plan shall be consistent with the provisions of subsections (a) and (b) below. Upon receipt of the marketing plan, the City shall promptly review the marketing plan and shall approve or disapprove it within thirty (30) days after submission. If the marketing plan is not approved, the Developer shall submit a revised marketing plan within thirty (30) days. A. Prohibition on Discrimination in Tenant Selection (Section 8 Vouchers and Certificate Holders). The Developer will review applications from prospective tenants of the Affordable Unit, on the same 885101\2049494.3 3/9!2017 basis as all other prospective tenants, of persons who are recipients of federal certificates for rent subsidies pursuant to the existing housing program under Section 8 of the United States Housing Act or any successor. The Developer shall not apply selection criteria to Section 8 certificate or voucher holders that are more burdensome than criteria applied to all other prospective tenants for the Affordable Unit, nor shall the Developer apply or pen -nit the application of management policies or lease provisions with respect to the Development which have the effect of precluding occupancy of Affordable Unit by such prospective tenants. B. Marketing Materials. The marketing plan submitted to the City shall include the following: means to be used to advertise the Affordable Unit to the public upon initial occupancy and as vacancies occur and maintenance of a waiting list; the amount of any application screening fee to be imposed by Developer, and information to be provided to applicants, including conditions and restrictions applicable to occupancy of the Affordable Unit, current Affordable Rent, permitted Rent increases, maximum qualifying Household Income for an Eligible Household, requirement for annual Household Income recertification, preferences, and requirement to vacate the Affordable Unit if the Tenant's Household Income exceeds the maximum qualifying income. 4.3 Income Certification. Upon initial occupancy and annually thereafter, the Developer will obtain, complete and maintain on file Household Income certifications (Exhibit C), or a similar form as may be approved by the City, for each Tenant renting the Affordable Unit. Developer shall make a good faith effort to verify that the Household Income certifications provided by a Tenant is accurate by taking two or more of the following steps as a part of the verification process for all members of the Tenant household age eighteen (18) or older: (a) obtaining a minimum of the three (3) most current pay stubs; (b) obtaining an income tax return for the most recent tax year including copies of any income tax returns where the Tenant is claimed as a dependent; (c) conducting a credit agency or similar search; (d) obtaining the three (3) most current savings and checking account bank statements; (e) obtaining an income verification form from a current employer; (f) obtaining an income verification form from the Social Security Administration and/or the California Department of Social Services if an adult member of the Tenant's household receives assistance from either of such agencies; or (g) if the Tenant is unemployed and has no such tax return, obtain another form of independent verification. The Developer shall maintain copies of annual Household Income certifications and to maintain that form on file for a minimum of five years and shall permit the City or their designee to inspect the household income certifications at the Developer's office upon three days' notice. The Developer shall provide any additional information reasonably requested by the City or its designee. 4.4 Annual Report. Tile Developer shall submit to the City and Marin Housing Authority by June 30 of each year a report, in a form prescribed by or otherwise acceptable to the City, verifying compliance by Developer with the ten -ns of this Agreement and certified as correct by the Developer under penalty of perjury. Exhibit D Certification of Continuing Compliance, or a similar form as may be approved by the City, may be used to meet this requirement. The annual report shall include without limitation the following information: A. Certifications of eligibility for all Tenants of the Affordable Unit at the time of initial occupancy and upon the yearly anniversary of their continuing tenancies. B. Verified Household Income statements. Developer shall retain in the Tenant's file all verifications of Tenant's Household Income. C. Number of persons in each Affordable Unit. D. Certification of the amount of Rent charged for the year for the Affordable Unit. 885 01\2049494.3 3 92017 E. Certification that Developer is not charging any fee other than Affordable Rent to Tenants of the Affordable Unit for all of the components of Rent defined in Section 1.1 above. F. Other information reasonably required by the City. 4.5 Other Reports. Within fifteen (15) days after receipt of a written request, Developer shall provide any other information or completed forms requested by the City or Marin Housing Authority to ensure compliance with this Agreement. 4.6 Records. The Developer shall maintain complete, accurate, and current records pertaining to the Units for five (5) years after creating such records, and shall pen -nit any duly authorized representative of the City or Marin Housing Authority to inspect and copy such records, including the records pertaining to Household Income and household size of Tenant households. 4.7 Initial Setup Fee The Developer agrees to pay to the City an initial setup fee in the amount of One Thousand Dollars ($1,000) to review the documents listed in this Section 4. If City expenses to review the documents are in excess of One Thousand Dollars ($1,000), the Developer upon written demand shall pay such actual excess costs. 4.8 Annual Monitoring fee. In addition to the initial set -tip fee described in Section 4.7 above, the Developer agrees to pay to the City during the Density Bonus Term an annual monitoring fee payable on or before June 30 of each year as established by the City. The initial annual monitoring fee is shown on Exhibit D. 5. Commencement of Density Bonus Term. The Density Bonus Term shall commence on the date that the Developer, City, and Marin Housing record a Notice stating that the Affordable Unit is rented and occupied by an Eligible Household. Such notice shall identify the beginning and end dates of the Density Bonus Tenn (Exhibit E). 6. Management of Pronerty and Property Maintenance. 6.1 Management Responsibilities. The Developer is responsible for all management fimctions with respect to the Development, including, without limitation, the annual recertification of household size and Household Income (subject to review by the City or its assignee), selection of Tenants, maintenance of a waiting list for the Affordable Unit, evictions, collection of Rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. The City and Marin Housing Authority shall have no responsibility over management of the Development. 6.2 Property Maintenance. The City places prime importance on quality maintenance to ensure that all developments within the City which include affordable housing units are not allowed to deteriorate due to below-average maintenance. Developer shall provide the Affordable Unit with the same level and quality of maintenance, including performance of repairs and periodic replacement of fixtures, as the Market -Rate Units. The Developer agrees to maintain all interior and exterior improvements, including landscaping, on the Property in good condition and repair (and, as to landscaping, in a healthy condition) and in accordance with all applicable laws, rules, ordinances, orders and regulations of all federal, state, county, municipal, and other governmental agencies and bodies having or claiming jurisdiction and all their respective departments, bureaus, and officials. 885\01\2049494.3 3/9/2017 6.3 Remedies. In the event that the Developer breaches any of the covenants contained in this Section 6 and such default continues for a period often (10) days after written notice from the City specifying the nature of the breach with respect to graffiti, debris, waste material, or a health or safety violation, or thirty (30) days after written notice from the City specifying the nature of the breach with respect to general maintenance, landscaping and building improvements, then the City, in addition to whatever other remedy it may have at law or in equity, shall have the right (but is not required) to enter upon the Property after ten (10) days' prior written notice to the Developer describing the nature of the City's intended actions and to perform or cause to be performed all acts and work necessary to protect, maintain, and preserve the improvements and landscaped areas on the Property, as specified in a correction plan approved by the City, and to attach a lien on the Property, or to assess the Property, in the amount of the expenditures incurred by the City or its agents arising from such acts and work of protection, maintenance, and preservation by the City and/or costs of such cure, plus an administrative charge equal to fifteen percent (15%) of the amount of such expenditures (the expenditures plus the administrative charges are the "Correction Costs"), if Developer does not remit the filll amount of the Correction Costs to the City within thirty (30) days after City notifies Developer of the full amount of the Correction Costs. 6.4 Taxes and Assessments. Developer shall pay all real and personal property taxes, assessments, if any, and charges and all franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed against it, or payable by it, at such times and in such manner as to prevent any penalty from accruing, or any lien or charge from attaching to the Property; provided, however, that Developer shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event Developer exercises its right to contest any tax, assessment, or charge against it, Developer, on final determination of the proceeding or contest, shall immediately pay or discharge any decision or judgment rendered against it, together with all costs, charges and interest. 6.5 Damage or Destruction of Development. If all of the Units on the Property are demolished, the Incentives granted to Developer under Density Bonus Law shall terminate and the terms of this Agreement shall terminate and be of no fi►rther force and effect. 7. Enforcement 7.1 Covenants Runnina with the Land. The City, Marin Housing Authority, and Developer hereby declare their express intent that the covenants and restrictions set forth in this Agreement shall apply to and bind Developer and its heirs, executors, administrators, successors, transferees, and assignees having or acquiring any right, title or interest in or to any part of the Property and shall run with and burden such portions of the Property until terminated in accordance with Section 7.2. Until all or portions of the Property are expressly released from the burdens of this Agreement, each and every contract, deed or other instrument hereafter executed covering or conveying the Property or any portion thereof shall be held conclusively to have been executed, delivered, and accepted subject to such covenants and restrictions, regardless of whether such covenants or restrictions are set forth in such contract, deed or other instrument. In the event of foreclosure or transfer by deed -in -lieu of all or any portion of the Property prior to completion and sale of the Affordable Unit, title to all or any portion of the Property shall be taken subject to this Agreement. Developer acknowledges that compliance with this Agreement is a requirement of Density Bonus Law and the Project Approvals, and that no event of foreclosure or trustee's sale may remove these requirements from the Property. 10 885'•01 %•2049494.3 3'912017 7.2 Release of Property from Agreement. A. Prior to the expiration of the Density Bonus Term, Developer shall provide all notifications required by Government Code Sections 65863.10 and 65863.11 or successor provisions and any other notification required by any state, federal, or local law. B. Upon the expiration of the Density Bonus Term, City and Marin Housing Authority shall execute and record a release of the Development, the Property, and each Unit in the Development from the burdens of this Agreement within thirty (30) days following written notice from the Developer, if at the time the Developer is in compliance with all teens of this Agreement. 7.3 Default. Failure of the Developer to satisfy any of Developer's obligations under the tenns of this Agreement within thirty (30) days after the delivery of a notice of default from the City will constitute a default under this Agreement and a failure to satisfy the Project Approvals and Density Bonus Law. In addition to remedies for breach of this Agreement, the City or Marin Housing Authority, if authorized by the City, may exercise any and all remedies available to it, including but not limited to: A. withholding, conditioning, suspending or revoking any permit, license, subdivision approval or map, or other entitlement for the Development, including without limitation final inspections for occupancy and/or certificates of occupancy; B. instituting against the Developer, or other parties, a civil action for declaratory relief, injunction or any other equitable relief, or relief at law, including without limitation an action to rescind a transaction and/or to require repayment of any fiends received in connection with such a violation; C. where one or more persons have received financial benefit as a result of violation of this Agreement or of any requirement imposed under the Density Bonus Law, instituting legal action to recover as necessary, a penalty in any amount up to and including the amount of financial benefit received, in addition to recovery of the benefit received; D. requiring the Developer or his/her successors in interest to the Property to pay the City Rent or any other payment received by the Developer for the Affordable Unit from the date of any unauthorized use of the Affordable Unit or in excess of Affordable Rent; and E. Any other means authorized under the City of San Rafael Municipal Code, Density Bonus Law, or any other federal or state statute. 7.4 Remedies Cumulative. No right, power, or remedy given to the City or Marin Housing Authority by the terms of this Agreement or Density Bonus Law is intended to be exclusive of any other right, power, or remedy; and each and every such right, power, or remedy shall be cumulative and in addition to every other right, power, or remedy given to the City by the terms of this Agreement, Density Bonus Law, or by any statute or ordinance or otherwise against Developer and any other person. Neither the failure nor any delay on the part of the City or Marin Housing Authority to exercise any such rights and remedies shall operate as a waiver thereof, nor shall any single or partial exercise by the City or Marin Housing Authority of any such right or remedy preclude any other or filrther exercise of such right or remedy, or any other right or remedy. 7.5 Attornev's Fees and Costs. If either party initiates an action to enforce its rights under the Agreement, and elects at the initiation of the action to seek the recovery of attorneys' fees, the prevailing party I1 885 01\2049494.3 3 92017 in such an action shall be entitled to an award of reasonable attorneys' fees and costs in addition to any other recovery under this Agreement. 8. General Provisions 8.1 Appointment of Other Avencies. At its sole discretion, the City may designate, appoint or contract with any other public agency, for-profit or non-profit organization to perforin some or all of the City's obligations under this Agreement. 8.2 Records. Developer shall retain all records related to compliance with obligations under this Agreement for a period not less than five (5) years from the date of origination of such records, and make them available to City or Marin Housing Authority employees or others designated by the City for inspection and copying on five (5) business days' written notice. The City and Marin Housing Authority shall be entitled to monitor compliance with this Agreement and Density Bonus Law, and Developer shall cooperate with City monitoring, including obtaining Tenant Rent and Household Income verification upon request of the City. 8.3 Nondiscrimination. The Affordable Unit shall be available for occupancy to members of the general public. The Developer shall not give preference to any particular class or group of persons in renting the Affordable Unit, except to the extent that the Affordable Unit is required to be rented to Eligible Households and as required by this Agreement, including, without limitation, as set forth in Section 3 above; provided, however, there shall be no discrimination against or segregation of any person or group of persons, on account of race, color, creed, religion, sex, sexual orientation, marital status, national origin, source of income (e.g., SSI), age (except for lawful senior housing), ancestry, or disability, in the leasing, transferring, use, occupancy, tenure, or enjoyment of any Unit nor shall the Developer or any person claiming under or through the Developer, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use, or occupancy of Tenants of any Unit or in connection with the employment of persons for the construction, operation and management of the Development. 8.4 Hold Harmless. Developer will indemnify and hold harnless (without limit as to amount) City and Marin Housing Authority and their elected officials, officers, employees and agents in their official capacity (hereinafter collectively referred to as "Indemnitees"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgments and executions for damages of any and every kind and by whomever and whenever made or obtained, allegedly caused by, arising out of or relating in any manner to the Development, the Affordable Unit, or Developer's performance or non-performance under this Agreement, including claims pursuant to California Labor Code Section 1720 et seq., and shall protect and defend Indemnitees, and any of them with respect thereto, except to the extent arising from the active negligency, sole negligence or willful misconduct of the Indemnitees. The provisions of this Section shall survive expiration or other termination of this Agreement or any release of part or all of the Property from the burdens of this Agreement, and the provisions of this Section shall remain in full force and effect. 8.5 Notices. All notices required pursuant to this Agreement shall be in writing and may be given by personal delivery or by registered or certified mail, return receipt requested, to the Party to receive such notice at the addressed set forth below: 12 885101\2049494.3 3/912017 To the City: To the Developer: To Marin Housing Authority: City of San Rafael Community Development Department 1400 Fifth Avenue San Rafael, Ca 94915-1560 G Square Partners, LLC P.O. Box 2938 San Anselmo, CA 94979 Attn: Ralph S. Epstein, Managing Member LRT Investments, LCC 50 Moncada Way San Rafael, CA 94901 Attn: Stuart D. Lum, Managing Member Marin Housing Authority Executive Director 4020 Civic Center Drive San Rafael, CA 94903-4173 Any party may change the address to which notices are to be sent by notifying the other parties of the new address, in the manner set forth above. 8.6 Integrated Agreement. This Agreement constitutes the entire Agreement between the Parties and no modification hereof shall be binding unless reduced to writing and signed by the Parties hereto. 8.7 Each Party's Role in Drafting the Agreement. Each Party to this Agreement has had an opportunity to review the Agreement, confer with legal counsel regarding the meaning of the Agreement, and negotiate revisions to the Agreement. Accordingly, neither Party shall rely upon Civil Code Section 1654 in order to interpret any uncertainty in the meaning of the Agreement. 8.8 Amendment of Agreement: ADnrovals and Consents. A. Amendments to this Agreement, including any proposal to change any condition of the Project Approvals, shall be subject to the review and approval of the decision-making body which approved the Development. No amendment may be approved that is inconsistent with State law, the San Rafael Municipal Code, or any adopted affordable housing guidelines. Upon approval, a new Agreement or amendments to this Agreement, as appropriate, shall be executed and recorded. B. The City has authorized the City Manager to execute this Agreement and has authorized the City Manager to deliver such approvals or consents as are required by this Agreement. Marin Housing Authority has authorized the Executive Director to execute this Agreement and has authorized Executive Director to deliver such approvals or consents as are required by this Agreement. Any consents or approvals required under this Agreement shall not be unreasonably withheld or made, unless it is specifically provided that a sole discretion standard applies. 13 885\01\2049494.3 3/9/2017 C. This Agreement, and any section, subsection, or covenant contained herein, may be amended only upon the written consent of the City, Marin Housing Authority, and the Developer. 8.9 No Claims. Nothing contained in this Agreement shall create or justify any claim against the City or Marin Housing Authority by any person that Developer may have employed or with whom Developer may have contracted relative to the purchase of materials, supplies or equipment, or the furnishing or the performance of any work or services with respect to the Property or the construction of the Development or construction of the Affordable Unit. 8.10 Applicable Law and Venue. This Agreement shall be governed by California law. Venue for any dispute arising out of this Agreement shall be Marin County. 8.11 Waivers. Any waiver by the City or Marin Housing Authority of any obligation or condition in this Agreement must be in writing. No waiver will be implied from any delay or failure by the City or Marin Housing Authority to take action on any breach or default of Developer or to pursue any remedy allowed under this Agreement or applicable law. Any extension of time granted to Developer to perform any obligation under this Agreement shall not operate as a waiver or release from any of its obligations under this Agreement. Consent by the City or Marin Housing Authority to any act or ornission by Developer shall not be construed to be consent to any other or subsequent act or ornission or to waive the requirement for Marin Housing Authority's or the City's written consent to future waivers. 8.12 Title of Parts and Sections. Any titles of the sections, subsections, or subparagraphs of this Agreement are inserted for convenience of reference only and shall be disregarded in interpreting any part of the Agreement's provisions. 8.13 Multiple Originals: Counterpart. This Agreement may be executed in multiple originals, each of which is deemed to be an original, and may be signed in counterparts. 8.14 Recording of Agreement. This Agreement shall be recorded against the Property in the Official Records of the County of Marin prior to the recordation of any parcel reap or final subdivision map or issuance of any building pen -nit for the Development, whichever occurs first. 8.15 Severabilitv. In the event any limitation, condition, restriction, covenant, or provision contained in this Agreement is to be held invalid, void or unenforceable by any court of competent jurisdiction, the remaining portions of this Agreement shall nevertheless be and remain in full force and effect. 14 885\01\2049494.3 3/9/2017 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. DEVELOPER: CITY: G Square Partners, LLC, a California limited liability City of San Rafael, a municipal corporation company r By: rrtz, - By:Cph "'�'L 1/ — Jii Scly Man er S. Epstein, Managing Member LRT Investment, LLC, a California limited liability ATTEST: company By: Stuart D. Lum, Managing Member MARIN HOUSING AUTHORITY: Housing Authority of the County of Marin, a public body, corporate and politic, created under the Housing Authority Law of the St7ecutive alifornia By: c -�— Lewis A. Jordan, E Director 16 885\01\2049494.3 3/9/2017 Esther Beirne, City Clerk APPROVED AS TO FORM: % .R r Robert F. Epstein, City Attorney A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF MARIN On ! / %`� 2 2017, before me, / /� , Notary Public, �1 ���, personally appearec��S leS4-erh/ , who proved to me on the basis of satisfactory evidence to be the person(s) whose natne(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 upon behalf of which the person(s) acted, executed the instrument. I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. w, iftA� SILVER CLARK F Commission # 2025748 a s Notary Public - Callforniti / Marin County F My Comm. Expires Jun Is, 201 885\01\2049494,3 3/9/2017 _gje-j Name: Notary Public 17 rA .. L. . SILVER CLARK Commission # 2025748 a a =� Notary Public - California z z `t" Marin County My Comm. Expires Jun 18, 2017 r v�✓'o'-v'v'V'vti.^`V"�'V"'V-L""17'^Y'Q`J" A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF MARIN lv2FA- On � Zo 1 before me, ,SJ c , Notary Public, personally ap eared G j� L �� , who proved to me oil the basis of satisfactory evidence to be the person(s) whose names) 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 upon behalf of which the person(s) acted, executed the instrument. I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. Notary Public Mame: SILVER CLARK Commission # 2025748 ; ��< Notary Public - California z z ' Marin County D My Comm. Expires Jun 18, 2017 .r.,-�cr'w-w-v„—v--vw•�r-tic-�,v..•V`r-v- 18 885\01\2049494.3 3/9/2017 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF MARIN On l �Zp17before me, (.,x01 U . ZAX 1,4 Yl , Notary Public, personally appea ed "u) k A. :;,,r-e(AK who proved to me on the basis of satisfactory evidence to be the person(.*) whose name(s) is/a;e-subscribed to the within instrument and acknowledged to me that he/s4ieAkey executed the same in his/l I4@-ir authorized capacity(ies), and that by his/lam signature() on the instrument the person(A), or the entity upon behalf of which the person(A acted, executed the instrument. I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. / �'�� - A. Name: ro _ CAROL J. KAZARIAN Commission # 2070835 Z ,-m Notary Public - California n Z Marin County M Comm. Expires Ju` 15,2018 19 885W1\2049494.3 3/9/2017 #t7f/l rt ACKNOWLEDGMENT A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. State of California County of Marin On before me, E. Beirne, Notary Public (insert name and title of the officer) personally appeared ::;:!'—/,y 94.o U 7 -z— who proved to me on the basis of satisfactory evidence to be the person(s) whose name(so/are subscribed to the within instrument and acknowledged to me thatg/she/they executed the same in lQher/their authorized capacity(ies), and that by&/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS my hand and official seal. E. BEIRNE t COMM. #2112433 z 0 �� Notary Public - California o Z Marin County I l� ' My Comm. Expires June 10, 20191 Signature (Seal) EXHIBIT A DESCRIPTION OF PROPERTY Beginning at a point formed by the intersection of the westerly line of "G" Street, with the northerly line of 4th Street; thence running westerly along said northerly line of 4th Street; a distance of 100 feet; thence at a right angle northerly a distance of 75 feet; thence at a right angle easterly at a distance of 100 feet to the westerly line of "G" Street; thence southerly along said westerly line of "G" Street, a distance of 75 feet to the point of beginning. EXHIBIT B UNIT DESCRIPTION AND SAMPLE CALCULATION OF AFFORDABLE RENT TOTAL NUMBER OF VERY LOW AND LOW INCOME UNITS:One One 1 Bedroom unit @ Very Low. UNIT LOCATION -DESCRIPTION: One 1 Bedroom unit ALLOWABLE RENT CALCULATION: Housing expense includes utility allowance per schedule below (allowances from Marin Housing). Very Low Income is 50% of Area Median Income, Low Income is 60% of Area Median Income and Moderate Income is 80% of Area Median Income. The applicable household and unit sizes are listed below. Actual households can exceed the household size indicated but the rental calculation will not change. For example, using the 2017 Area Median Income such calculation would be as follows: The One Bedroom Housing Expense shall not exceed 1/12 of 30% of 50% (very low income). The maximum qualifying tenant income is 50% of Area Median Income for very low income or a lesser income as defined by the Owner. Household Size 2 Person Unit Type 1 BRM Median Income 92,250 50% 46,150 Monthly Income 3,846 30% of Income 1,154 Monthly Utility Allowance (48) Allowable Rent 1,106 i EXHIBIT C HOUSEHOLD INCOME CERTIFICATION SAN RAFAEL BELOW MARKET RATE RENTAL MONITORING PROGRAM Project Name: G Square Date: APARTMENT NUMBER # NUMBER OF BEDROOMS MONTHLY RENT $ OCCUPANT/HOUSEHOLD NAME: TOTAL HOUSEHOLD GROSS ANNUAL INCOME: Total household income is the combined, gross, pre-tax income of all occupants of the household including any co -signors on the lease. Income includes all wages, salaries, governmental assistance, as reported as gross income for federal income tax; or verified by pay stubs, bank account records, governmental assistance records or other relevant documentation. Attached hereto are the tax returns, pay stubs or other evidence of the income of the persons listed below: Name of household member Relationship to head of household Age Place of Employment/Source of income I/We understand and have read and answered fully, frankly and personally each of the above questions under penalty of perjury and do hereby swear they are true. Occupant -Head of Household Date: PROPERTY OWNER TO MAINTAIN THIS DOCUMENT FOR FIVE YEARS FOR INSPECTION PURSUANT TO AGREEMENT WITH THE CITY o Q § LL E ƒ ■ w —j0 2 j a = § o L) ! $ \\ ® ® ` = o /ƒf /2 2 . E ® \ \ \ C 0 @ a) ca �E: G- k -E R I= co =Iam tee@ 22 LLa) 2 E / �\ / \ o 0,— 0-0 \/ _ M § . a §fig a E$2 %%f #ƒ2 7 o < \ 2 c = > 2 / -0 -§ » E @ c ) c > 0 « 16 / w Q ICD 3 < E �2 E 0— ` E z C_ o u 0 q= 2 S Rf§ a cu 0%z J-- 0@�>Z C::) « « 2/u R� =22» 6 D/� k � k 2 ` E Z : < / \ \ / k ƒ { ca — & n 't �So)k _o LL° 0�� <�LLJ \ \� / LLJ 00u < o Cr F— 2 { a)R 0 7/ 4 0 ] L k K v/ / \ t Iƒ $ 2 o 0 / ƒ 2/§77= u 0 < I / 0 § § \ o o § w = E \± 2_ 2 o E � z m 0m k < Ik 2a= \ ca 2 ƒ ƒ % ( z z z z = n co U) \// C—mm# » £ R 2 E o \55 �2 § /� R . o 2 c 2k\ 2 2 22/ f k / \� k \ \ II zzp S CL QO£ ƒ}§ /E- �\/ /$_�/£% -- 0 _ z w= _ _ =2 2 # • ; 3 £ e _ m # \77/2\$ < 00. e& 0< e E a o Q § LL E ƒ ■ w EXHIBIT E RECORDING REQUESTED By and WHEN RECORDED MAIL TO: City of San Rafael Attn: City Clerk 1400 Fifth Avenue San Rafael, Ca 94901 No fee for recording pursuant to Government Code Section 27383 NOTICE OF COMMENCEMENT OF DENSITY BONUS TERM A. The CITY OF SAN RAFAEL, a municipal corporation ("City"); the HOUSING AUTHORITY OF THE COUNTY OF MARIN, a public body, corporate and politic, created under the Housing Authority Law of the State of California ("Marin Housing Authority"); and G SQUARE PARTNERS and LRT INVESTMENT , California limited liability companies, or any successor in interest ("Developer"), collectively the "Parties," entered into that certain Regulatory Agreement and Declaration of Restrictive Covenants executed on and recorded in the Official Records of the County of Marin, California (the "Official Records") on as Document No. (the "Affordability Restrictions") as to the property located in the City and described in EXHIBIT A attached hereto and incorporated by reference herein (the "Property"). The Affordability Restrictions are an equitable servitude and covenant running against the land for the benefit of the City. All capitalized terms not otherwise defined in this Notice of Commencement shall have the meaning ascribed to them in the Affordability Restrictions. B. Section 5 of the Affordability Restrictions provides that the Density Bonus Term, as defined in the Affordability Restrictions, shall commence on the date that this Notice of Commencement is recorded in the Official Records. NOW, THEREFORE, the Parties hereby declare as follows: 1. The Affordable Unit has been rented and is occupied by an Eligible Household. 2. The beginning date of the Density Bonus Term is . The Density Bonus Tenn shall terminate on , 55 years from the date of this Notice. Signatures of: following page DEVELOPER: CITY: G Square Partners, LLC, a California limited City of San Rafael, a municipal corporation liability company By: By: Ralph S. Epstein, Managing Member Jim Schutz, City Manager LRT Investment, LLC, a California limited liability ATTEST: company By: Stuart D. Lum, Managing Member Esther Beirne, City Clerk MARIN HOUSING AUTHORITY: Housing Authority of the County of Marin, a public body, corporate and politic, created under the Housing Authority Law of the State of California APPROVED AS TO FORM: By: Lewis A. Jordan, Executive Director Robert F. Epstein, City Attorney 2 A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document. STATE OF CALIFORNIA COUNTY OF MARIN On , before me, , Notary Public, personally appeared , who 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 ►ne 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 upon behalf of which the person(s) acted, executed the instrument. I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct. WITNESS ►ny hand and official seal. Name: Notary Public 3