HomeMy WebLinkAboutED RA 21 Stevens Place GrantCITY OF
SAN RAFAEL
AGENDA ITEM NO.: 3
MEETING DATE: March 1, 2010
San Rafael Redevelopment Agency Agenda Report
Department: Redevelopment
Prepared by: iC Initials:
Nanc Mackle, Economic Development Director Ke Nordhoff, Executive
Director
SUBJECT: RESOLUTION APPROVING A $ 50,000 GRANT AGREEMENT BY THE
REDEVELOPMENT AGENCY TO HABITAT FOR HUMANITY GREATER SAN FRANCISCO
(21 STEVENS PLACE)
RECOMMENDATION: Staff recommends that the Agency adopt the attached resolution
approving a grant agreement with Habitat for Humanity Greater San Francisco in the amount of
$50,000 for acquisition and rehabilitation of 21 Stevens Place and authorize the Economic
Development Director to execute the agreement.
BACKGROUND: Habitat for Humanity Greater San Francisco ("Habitat") has acquired 21 Stevens
Place and has requested Agency financial assistance. The home acquisition is part of Habitat's
neighborhood revitalization program for Marin County. The revitalization program is being funded
by the Marin Community Foundation and by previously uncommitted funds from the Greater San
Francisco Habitat organization. Habitat now owns two homes in Marin County, one in Novato and
one in San Rafael. Attachment A outlines the organization's program for San Rafael and Marin
County.
ANALYSIS: The grant amount would total $50,000. The funds would be used to assist Habitat in
rehabilitating the property. The grant agreement requires that the home remain affordable to lower
income persons for a minimum period of 50 years. The home contains three bedrooms. Low-
income is defined as being under 80% of the area median income, currently $77,450 for a four
person household. Habitat anticipates the selected family will have a household income of 30-60%
of area median income ($29,050-$58,000 for a four person household).
FOR AGENCY SECRETARY ONLY
File No.:
Agency Meeting:
Disposition:
The Agency funds will be utilized for the rehabilitation of the property. Normally, Agency funding
obligates the grantee to pay CA prevailing wage rates. However, the California Labor Code § 1720,
grants an exception for self-help housing project in which no fewer than 500 hours of construction
work associated with the homes are to be performed by the homebuyers.
The proposed acquisition is located outside of the Project Area boundary. Pursuant to Health and
Safety Code 33334.2 (g), housing set aside funds maybe utilized outside of the Project Area upon
the adoption of a resolution of the Agency and the City Council that the use will be of benefit to the
Project. Therefore, both the Agency and the City Council will be acting on this item.
FISCAL IMPACT: The Agency's cost will be $50,000. The $50,000 will be charged to the
housing fund.
OPTIONS:
• Adopt the resolution authorizing the Economic Development Director to execute the grant
agreement in a form approved by Agency counsel.
• Direct staff regarding grant agreement provisions to reflect the desires of the Agency members.
• Reject the grant agreement.
ACTION REQUIRED: Staff recommends the Agency adopt the attached resolution authorizing
the Economic Development Director to effect the grant agreement with applicable alterations as
approved by Agency counsel.
ATTACHMENTS:
A: Memo from Habitat with funding request and project description
B: Draft Grant Agreement
SAN RAFAEL REDEVELOPMENT AGENCY
RESOLUTION NO.
MOVED BY: SECONDED BY:
A RESOLUTION APPROVING A $ 50,000 GRANT AGREEMENT BY THE
REDEVELOPMENT AGENCY TO HABITAT FOR HUMANITY GREATER SAN
FRANCISCO (21 STEVENS PLACE)
WHEREAS, the City Council (the "City Council") of the City of San Rafael (the "City")
has adopted and amended, from time to time, the Redevelopment Plan (the "Redevelopment
Plan") for the Central San Rafael Redevelopment Project Area (the "Project Area'); and
WHEREAS, the Redevelopment Agency of the City of San Rafael (the "Agency") is
responsible for administering the Redevelopment Plan to cause redevelopment of the Project
Area, including the provision of housing available at affordable housing cost to low and
moderate income households; and
WHEREAS, Habitat for Humanity Greater San Francisco, a California nonprofit public
benefit corporation (the "Developer") desires to acquire and rehabilitate certain real property
located outside the Project Area at 21 Stevens Place (the "Property"). The Property is improved
with a single family home which the Developer intends to rehabilitate and sell at affordable
housing cost to very low and low income persons (the 'Development"); and
WHEREAS, the Agency desires to provide a grant to the Developer (the "Agency Grant")
to finance the rehabilitation of the Property by the Developer; and
WHEREAS, it is proposed that the Agency fund the Agency Grant with Fifty Thousand
Dollars ($50,000) from the Agency's Low and Moderate Income Housing Fund (the "Housing
Fund"); and
WHEREAS, Health and Safety Code Section 33334.2(g) authorizes expenditure of
Housing Fund monies outside the Project Area upon a finding by the Agency and the City
Council that such use will be of benefit to the Project Area; and
WHEREAS, the Development will benefit the Project Area and serve major
Redevelopment Plan goals and objectives by increasing the amount of housing available at
affordable housing cost in the community, thereby decreasing the market pressure on the supply
of affordable housing in the community and the Project Area, by enhancing the economic
viability of business within the Project Area by providing housing near the Project Area for
people who will patronize businesses in the Project Area, and by alleviating blight in an area in
close proximity to the Project Area; and
WHEREAS, The California Environmental Quality Act (Public Resources Code Sections
21000 et seq.) ("CEQA") imposes no conditions on the Agency's consideration and approval of
this Agreement, because the project undertaken pursuant to this Agreement is the rehabilitation
of existing improvements and such projects are exempt from CEQA requirements under the
categorical exemption set forth in 14 CCR Section 15301; and
WHEREAS, by staff report accompanying this Resolution and incorporated into this
Resolution by this reference (the "Staff Report"), the Agency has been provided with additional
information upon which the findings and actions set forth in this Resolution are based.
NOW, THEREFORE, BE IT RESOLVED that the Agency hereby finds and determines
that the above recitals are true and correct and have served as the basis, in part, for the findings
and actions of the Agency set forth below.
BE IT FURTHER RESOLVED that, based on information and analysis set forth in the
above Recitals and contained in the Staff Report accompanying this Resolution, the Agency
hereby finds and determines pursuant to Health and Safety Code Section 33334.2(g) that the use
of moneys from the Housing Fund to assist the Development will be of benefit to the Project
Area and the program of redevelopment pursuant to the Redevelopment Plan.
BE IT FURTHER RESOLVED that the Agency hereby approves the Agency Grant and
allocates Fifty Thousand Dollars ($50,000) of Housing Fund monies to fund the Agency Grant.
BE IT FURTHER RESOLVED that the Agency hereby authorizes the Economic
Development Director to execute on behalf of the Agency the Grant Agreement, substantially in
a form approved by Agency Counsel, and to take all actions necessary to provide and implement
the Agency Grant.
BE IT FURTHER RESOLVED that this Resolution shall take immediate effect upon
adoption.
I, ESTHER C. BEIRNE, Agency Secretary of the San Rafael Redevelopment Agency,
hereby certify that the foregoing resolution was duly and regularly introduced and adopted at a
regular meeting of the members of said Agency held on the 20th day of October 2003, by the
following vote, to wit:
AYES:
MEMBERS:
NOES:
MEMBERS:
ABSENT:
MEMBERS:
ABSTAIN:
MEMBERS:
ESTHER C. BEIRNE, Agency Secretary
` HabitatWIT for ®
Revitalizing San Rafael Neighborhoods through Foreclosure Recovery
22 Stevens Place, San Rafael
Request for Funding, Project Description and Financial Information
For Stephanie Lovette, Economic Department, City of San Rafael
December 4, 2009
Executive Summary
Habitat for Humanity Greater San Francisco has partnered with the Marin Community
Foundation to work in Marin County and assist neighborhoods recovering from the
foreclosure crisis. Habitat will acquire vacant and neglected properties, renovate them
with volunteer labor, and partner with local families to become stable additions to the
community through its Neighborhood Revitalization Program (NRP). The program name
underscores the greater impact of reclaiming neighborhoods from blight, one home at a
time.
Habitat Greater San Francisco seeks an initial $50,000 grant from the City of San
Rafael to fund the first foreclosed home in San Rafael acquired through the
program.
If the City of San Rafael can commit substantial funding to this home, it would be
allowed to create a deed restriction on the property, and priority for family selection
would be given to those who live and/or work in Marin County. Habitat is willing to
work with the city on utilizing any BMR waiting list or other housing list for
outreach.
In addition to the initial $250,000 grant from the Marin Community Foundation, Habitat
Greater San Francisco's Board of Directors has committed $300,000 from its reserves
specifically for the Marin County initiative. Habitat has also put in motion a funding plan
that includes additional funding from private and public sources in order to complete five
homes in total.
A funding allocation from the City of San Rafael (note that Menlo Park set precedent
with its own $100K allocation per home for the NRP program in its community) will
enable additional leveraging and encouragement of the local community.
EXHIBIT A
Project Description
Habitat Greater San Francisco's Neighborhood
Revitalization Program is modeled after its new
home construction program, but accelerates the
pace to rapidly produce results—eight months to
completion compared to several years for new
construction. Habitat plans to establish more
partnerships in the community to bring in additional
funding sources, and is especially eager to see
banks and lending institutions lead by example. As
San Rafael is looking to keep working families in
the community, it will find that Habitat Greater San
Francisco is well positioned to serve the deepest
levels of affordability – families earning 40 – 60%
of the Area Median Income.
Outcomes and Impacts
Habitat Greater San Francisco believes this is the most viable opportunity to bring
affordable homeownership to San Rafael in the very near future. The reason for this
position include: 1) It's sustainable - adapting and reusing existing homes and
infrastructure lessens the environmental impact of construction on a community; 2) It's
wise - at no other time has it been this affordable to acquire property and produce
affordable homeownership in Marin; the time may soon pass; and 3) It's timely - it fills a
gap to house working families at levels of affordability no other developer can
accommodate, especially as household incomes fall.
Habitat Greater San Francisco hopes this initiative will pave the way for new home
construction in Marin. According to the Bay Area Council's Bay Area Housing Profile
2006, the lack of affordable housing in Marin has earned the county a failing grade. The
Association of Bay Area Governments predicted that Marin County would need 3,466
new affordable housing units between 1999 and 2005 to keep up with population and job
growth. Marin County met only 41 percent of that need, with 1,429 new units constructed
during the six year period. Habitat is prepared to help Marin County meet that need and
remains committed to creating new affordable homes in for families in Marin County.
Habitat for Humanity Greater San Francisco Proposal to Page 2 of
City of San Rafael
December 4, 2009
First Neighborhood Revitalization Program Home in San Rafael
21 Stevens Place
Why San Rafael?
Over the past year, foreclosure signs have become an all too common sight, causing
families to be displaced and, in some cases, to leave their communities for good. Marin
County has maintained a relatively low number of foreclosures; however, the county's
low overall foreclosure rate obscures the magnitude of the problem in particular
neighborhoods. The Cities of San Rafael and Novato combined carry 65 percent of all the
foreclosures in the entire county. Additionally, homes that meet Habitat's model for the
program exist within the city of San Rafael. (See Table 1- Foreclosures in Marin, page
3.)
The crippling effects on these key communities could have ramifications for the entire
region unless the root of the program is addressed. San Rafael is home to one of Marm's
industrial and job centers, drawing a large workforce.
Table 1 - Foreclosures in Marin
*Foreclosure defined as bank owned or auction, not including notice of defaults
" Habitat model: 2+g R, bank -owned, $300,000 maximum for acquisition
Habitat for Humanity Greater San Francisco Proposal to Page 3 of 5
City of San Rafael
December 4, 2009
Communities, through no fault of their own, are hard-pressed to deal with the growing
glut of homes that are standing vacant, in many cases blighted, and posing devastating
effects on local neighborhoods. Unlike other communities in the Bay Area and across the
country, Marin County is ineligible for federal Neighborhood Stabilization Program
funds, leaving cities like San Rafael to come up with a workable solution to the
foreclosure crisis on their own.
Financial Information
Project Pro Forma
Site Supervision l Volunteer Management- 10'vvv
CofttSuct on Nlate�ls Z8 00ds
Greening / Energy Efficiency (windows, 4,000
appliances, HVAC, native landscaping)
RE Taxes during Construction
Contingency
Legal
Developer's Fee
Debt Service
Soft Costs Subtotal
Habitat for Humanity Greater San Francisco Proposal to Page 4 of 5
City of San Rafael
December 4, 2009
Families Served
The Habitat Greater San Francisco NRP homes will be rehabilitated in partnership with
families earning between 40 and 60 percent of the Area Median Income (AMI). To be
eligible for Habitat's homes, a family of four in Marin County would need to earn
between $38,720 and $58,080. All families in this program will be categorized as low or
very low income by the U.S. Department of Housing and Urban Development standards.
Habitat for Humanity also requires that applicants live or work in Marin County.
Habitat will rehabilitate and sell the homes, at cost, to hardworking families in Marin
County, and will provide the families with a 0% interest mortgage, served by our
organization. The Fund for Humanity, our monthly mortgage income, is applied to future
Habitat projects. One of the requirements for purchasing a home through Habitat is
participation in training workshops, which include topics such as budgeting, credit,
conflict resolution, understanding legal documents, home maintenance and neighborhood
safety. Each family, along with their friends and supporters, is also required to complete
500 hours of "sweat equity" during the construction of their own home.
Funding Plan
Community Support sources include individual donors, corporations, civic organizations,
and foundations. Government grant sources include state and local funds. Habitat Greater
San Francisco will apply for Affordable Housing Program funding through the Federal
Home Loan Bank that will reduce the total mortgage amount to the family. The revenue
side represents a modest estimate from Community Support and Government Grants. It
also assumes an additional allocation of $100,000 in previously uncommitted Habitat
funds.
Habitat's Neighborhood Revitalization Program represents a unique public-private
initiative drawing support from many sectors of the community to step in and fill the gap.
Habitat for Humanity Greater San Francisco looks forward to a partnership with the City
of San Rafael and the opportunity to make a real and lasting difference in our
communities.
Habitat for Humanity Greater San Francisco Proposal to Page 5 of 5
City of San Rafael
December 4, 2009
GRANT AGREEMENT
by and between
THE REDEVELOPMENT AGENCY OF
THE CITY OF SAN RAFAEL
and
HABITAT FOR HUMANITY GREATER SAN FRANCISCO
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TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS AND EXHIBITS 4
Section1.1 Definitions.........................................................................................................4
Section1.2 Exhibits...........................................................................................................10
ARTICLE 2 GRANT PROVISIONS
10
Section2.1 Grant...............................................................................................................11
Section2.2 Use of Funds...................................................................................................11
Section 2.3 Grant Disbursement........................................................................................11
Section 2.4 Repayment of the Agency Grant.....................................................................15
ARTICLE 3 REHABILITATION AND SALE OF THE PROPERTY
16
Section 3.1 Commencement of Rehabilitation..................................................................16
Section 3.2 Completion of Rehabilitation..........................................................................16
Section 3.3 Performance of Work Pursuant to Laws; Prevailing Wages ..........................
17
Section3.4 Relocation.......................................................................................................19
Section3.5 Equal Opportunity...........................................................................................20
Section 3.6 Progress Reports.............................................................................................21
Section 3.7 Construction Responsibilities.........................................................................21
Section 3.8 Mechanics Liens, Stop Notices, and Notices of Completion ..........................22
Section3.9 Inspections......................................................................................................24
Section3.10 Information...................................................................................................25
Section3.11 Records.........................................................................................................25
Section3.12 Audits............................................................................................................26
Section 3.13 Hazardous Materials.....................................................................................27
Section 3.14 Maintenance and Damage.............................................................................32
Section3.15 Fees and Taxes..............................................................................................33
Section 3.16 Notice of Litigation.......................................................................................34
Section 3.17 Maintenance of Property as Affordable Housing.........................................35
Section 3.18 Non-Discrimination......................................................................................38
Section 3.19 Mandatory Language in All Subsequent Deeds, Leases and
Contracts..........................................................................................................39
Section 3.20 Insurance Requirements................................................................................45
ARTICLE 4 ASSIGNMENT AND TRANSFERS
Section4.1 Definitions.......................................................................................................50
Section 4.2 Purpose of Restrictions on Transfer or Assignment.......................................50
Section 4.3 Prohibited Transfers........................................................................................51
Section 4.4 Permitted Transfers Without Prior Agency Approval....................................52
Section 4.5 Permitted Transfers With Prior Approval.......................................................52
ARTICLE 5 REPRESENTATIONS AND WARRANTIES OF THE GRANTEE 53
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TABLE OF CONTENTS
(continued)
Page
Section 5.1 Representations and Warranties......................................................................53
ARTICLE 6 DEFAULT AND REMEDIES 58
Section 6.1 Events of Default............................................................................................58
Section6.2 Remedies.........................................................................................................61
Section 6.3 Right of Contest..............................................................................................62
Section 6.4 Remedies Cumulative.....................................................................................63
ARTICLE 7 GENERAL PROVISIONS 64
Section 7.1 Relationship of Parties....................................................................................64
Section7.2 No Claims.......................................................................................................65
Section7.3 Amendments...................................................................................................65
Section 7.4 Entire Understanding of the Parties................................................................66
Section 7.5 Indemnification...............................................................................................66
Section 7.6 Non -Liability of Agency and City Officials, Employees and Agents ............
67
Section 7.7 No Third Party Beneficiaries..........................................................................67
Section7.8 Action by the Agency.....................................................................................68
Section7.9 Waivers...........................................................................................................69
Section 7.10 Notices, Demands and Communications......................................................70
Section 7.11 Applicable Law and Venue...........................................................................71
Section 7.12 Parties Bound................................................................................................72
Section7.13 Attorneys' Fees..............................................................................................72
Section7.14 Severability...................................................................................................73
Section7.15 Force Majeure...............................................................................................73
Section 7.16 Conflict of Interest........................................................................................74
Section 7.17 Title of Parts and Sections............................................................................75
Section 7.18 Multiple Originals; Counterpart ....................................................................76
Exhibit A Legal Description
Exhibit B Memorandum of Grant Agreement
Exhibit C Eligibility Requirements and Priorities
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GRANT AGREEMENT
This Grant Agreement (the "Agreement") is entered into as of , 2010, by and
between the Redevelopment Agency of the City of San Rafael, a public body, corporate and
politic (the "Agency") and Habitat for Humanity Greater San Francisco, a California nonprofit
public benefit corporation (the "Grantee"), with reference to the following facts, purposes and
intentions.
RECITALS
A. The Grantee has acquired a residence located at San Rafael,
California as described in the attached Exhibit A (the "Property"). The Property includes one
single-family home and appurtenant structures. The Grantee intends to rehabilitate the Property
and to sell it to a very low income household.
B. Pursuant to Health and Safety Code Sections 33334.2, 33334.3 and 33334.6, the
Agency is providing Fifty Thousand Dollars ($50,000) of financial assistance to the Grantee (the
"Agency Grant") from the Agency's Low and Moderate Income Housing Fund and is imposing
occupancy and affordability restrictions on the Property.
C. The Grantee's rehabilitation and sale of the Property at an affordable price are not
financially feasible without the Agency's financial assistance. The Agency therefore desires to
provide financial assistance to the Grantee for the acquisition of the Property in consideration of
the Grantee's agreement to acquire and sell the Property consistent with this Agreement,
including (without limitation) the occupancy and affordability restrictions set forth in Article 3.
The amount of Agency assistance provided pursuant to this Agreement does not exceed the
amount of Agency assistance necessary to make the acquisition and operation of the Property as
restricted by this Agreement financially feasible.
D. Pursuant to the California Environmental Quality Act (Public Resources Code
Sections 21000 et sem.) and implementing guidelines, the project undertaken pursuant to this
Agreement is categorically exempt as set forth in 14 CCR Section 15301 (minor alteration of
existing facilities involving no change in use).
E. The Property is located outside the Central San Rafael Redevelopment Project
Area (the "Project Area"). The City Council and the Agency have each made a finding that the
rehabilitation of the Property and required sale to a very low income household will be of benefit
to the Project Area pursuant to Health & Safety Code Section 33334.2(g).
WITH REFERENCE TO THE FACTS RECITED ABOVE, the Agency and the Grantee
(the "Parties") agree as follows:
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ARTICLE 1
DEFINITIONS AND EXHIBITS
Section 1.1 Definitions.
The following capitalized terms have the meanings set forth in this Section 1.1 wherever
used in this Agreement, unless otherwise provided:
(a) "Affordable Ownership Price" means a sales price calculated by the
Agency that includes a reasonable down payment and results in a monthly payment of mortgage
interest and principal, property taxes, mortgage insurance, homeowner's insurance, any
homeowners' association dues, and a reasonable allowance for utilities and property maintenance
costs that is equal to or less than one -twelfth (1/12) of thirty percent (30%) of fifty percent (50%)
of Area Median Income, as adjusted for an assumed household size of - persons. [Should`eggdl
the number of bedrooms plus 1 z'n the hamej
(b) "Agency" is defined in the first paragraph of this Agreement.
(c) "Agency Board" means the Board of the Agency.
(d) "Agency Grant" means the Agency Grant to the Grantee in the total
principal amount of Fifty Thousand Dollars ($50,000). The Agency Grant is more particularly
described in Article 2.
(e) "Agreement" is defined in the first paragraph of this Grant Agreement.
(f) "Approved Financing" means all of the following funds acquired by the
Grantee, and approved by the Agency for the purpose of financing the rehabilitation of the
Property, in addition to the Agency Grant:
(1) /Should ba added by
Habitat.]
(g) "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.
(h) "City" means the City of San Rafael, a municipal corporation.
(i) "City Council" means the City Council of the City.
0) "Deed of Trust" means the deed of trust, in the form provided by the
Agency, executed by each buyer of the Property, securing the buyer's performance under the
Resale Agreement and the Note.
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(k) "Default" has the meaning set forth in Section 6.1 below.
(1) "Grantee" is defined in the first paragraph of this Agreement.
(m) "Grant Documents" means this Agreement, the Memorandum of Grant
Agreement, and any other document or agreement evidencing the Agency Grant.
(n) "Hazardous Materials" has the meaning set forth in Section 3.13 below.
(o) "Hazardous Materials Claim" has the meaning set forth in Section 3.13
below.
(p) "Hazardous Materials Law" has the meaning set forth in Section 3.13
below.
(q) "Memorandum of Grant Agreement' means the memorandum of this
Agreement to be recorded against the Property, in substantially the form attached to this
Agreement as Exhibit B.
(r) "Note" means the promissory note, in the form provided by the Agency,
executed by each buyer of the Property.
(s) "Notice of Affordability Restrictions" means a Notice of Affordability
Restrictions on Transfer of Property in the form required by Health & Safety Code Section
33334.3(f)(3)(B) or successor provision.
(t) "Parties" means the Agency and the Grantee.
(u) 'Property" means the real property located in the City of San Rafael,
County of Marin, State of California, more particularly described in the attached Exhibit A, and
all improvements on the Property.
(v) "Resale Agreement' means the Occupancy, Resale and Refinancing
Restriction Agreement and Option to Purchase, in the form provided by the Agency, for a term
of forty-five (45) years, executed by each buyer of the Property and the Agency. If mutually
agreed by the Agency and Grantee, the Grantee may also be a party to the Resale Agreement.
(w) "Term" means the term of this Agreement, the Resale Agreement, and/or
the Deed of Trust, which commences as of the date of this Agreement and ends forty-five (45)
years after the date of recordation of the Resale Agreement and Deed of Trust.
(x) "Transfer" has the meaning set forth in Section 4.1 below.
(y) "Very Low -Income Household" means a household whose 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.
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Section 1.2 Exhibits.
The following exhibits are attached to this Agreement and incorporated into this
Agreement by this reference:
EXHIBIT A: Legal Description of the Property
EXHIBIT B: Memorandum of Grant Agreement
EXHIBIT C: Eligibility Requirements and Priorities
ARTICLE 2
GRANT PROVISIONS
Section 2.1 Grant.
The Agency shall grant to the Grantee the amount of Fifty Thousand Dollars ($50,000),
to be disbursed in the manner described in Section 2.3 below, in exchange for the restrictions
placed upon the Property by this Agreement.
Section 2.2 Use of Funds.
(a) The Grantee shall use the Agency Grant to fund rehabilitation of the
improvements on the Property, consistent with the Approved Rehabilitation Budget, attached
hereto as Exhibit B.
(b) The Grantee shall not use the Agency Grant for any other purpose without
the prior written consent of the Agency.
Section 2.3 Grant Disbursement.
The Agency shall have no obligation to disburse any of the Agency Grant unless the
following conditions have been and continue to be satisfied:
(a) There exists no Default nor any act, failure, omission or condition that
would constitute an event of Default under this Agreement;
(b) The Grantee has delivered to the Agency a copy of an authorizing
resolution authorizing the Grantee's execution of the Grant Documents and the transactions
contemplated by the Grant Documents and has provided evidence reasonably satisfactory to the
Agency that the Grantee exists in good standing at the time of the proposed disbursement;
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(c) The Grantee has executed this Agreement and has delivered to the Agency
the Memorandum of Grant Agreement in substantially the form attached to this Agreement as
Exhibit B.
(d) The Memorandum of Grant Agreement has been recorded against the
Property in the official records of the County of Marin. The Agency agrees that the
Memorandum of Grant Agreement may be recorded in a position subordinate to any Approved
Financing.
(e) The Grantee has furnished the Agency with evidence of the insurance
coverage meeting the requirements of Section 3.20 below;
(f) The Agency Grant, together with other funds or firm commitments for
funds that the Grantee has obtained in connection with the Property, are not less than the amount
that the Agency determines is necessary to pay for rehabilitation of the Property and to satisfy all
of the covenants contained in this Agreement;
(g) The Grantee has closed all Approved Financing described in Section 1.1(f)
above; and
(h) The Agency has received a written draw request from the Grantee,
including certification that the condition set forth in Section 2.3(a) continues to be satisfied, and
setting forth the proposed uses of funds consistent with Section 2.2 above, the amount of funds
needed, and a copy of the bill or invoice covering a cost incurred or to be incurred. When a
disbursement is requested to pay any contractor in connection with improvements on the
Property, the written request must be accompanied by (i) certification by the Grantee's architect
reasonably acceptable to the Agency that the work for which disbursement is requested has been
completed (although the Agency reserves the right to inspect the Property and make an
independent evaluation); and (ii) lien releases and/or mechanics lien title insurance endorsements
reasonably acceptable to the Agency. In the Agency's discretion, all disbursements for hard
construction costs shall be subject to a ten percent (10%) retention, with the retention released to
Grantee within sixty (60) days of the recording of a Notice of Completion by the Grantee.
Section 2.4 Repayment of the Agency Grant.
No repayment of the Grant shall be required if Grantee complies with the requirements of
this Agreement for the entire Term. The Grantee may not terminate this Agreement by tendering
repayment of the Agency Grant.
ARTICLE 3
REHABILITATION AND SALE OF THE PROPERTY
Section 3.1 Commencement of Rehabilitation.
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The Grantee shall cause the commencement of rehabilitation of the improvements on the
Property no later than 2010, subject to Section 7.15 below.
Section 3.2 Completion of Rehabilitation.
The Grantee shall diligently prosecute rehabilitation of the improvements on the Property
to completion, and shall cause the completion of the rehabilitation of the Improvements no later
than 201_ subject to Section 7.15 below.
Section 3.3 Performance of Work Pursuant to Laws; Prevailing Wages.
(a) The Grantee shall cause all work performed in connection with the
Property to be performed in compliance with (i) all applicable laws, ordinances, rules and
regulations of federal, state, county or municipal governments or agencies now in force or that
may be enacted hereafter, including (without limitation and where applicable) the prevailing
wage provisions of Sections 1770 et sem., of the California Labor Code and implementing rules
and regulations, including without limitation Labor Code Sections 1720 et seq., the hiring of
apprentices as required by Labor Code Sections 1775 et. seq., and the implementing regulations
of the Department of Industrial Relations (the "DIR"), and (ii) all directions, rules and
regulations of any fire marshal, health officer, building inspector, or other officer of every
governmental agency now having or hereafter acquiring jurisdiction. The work shall proceed
only after procurement of each permit, license, or other authorization that may be required by
any governmental agency having jurisdiction, and the Grantee shall be responsible to the Agency
for the procurement and maintenance thereof, as may be required of the Grantee and all entities
engaged in work on the Property.
(b) The Grantee shall indemnify, hold harmless and defend (with counsel
reasonably selected by the Agency) the Agency and the City against any claim for damages,
compensation, fines, penalties or other amounts arising out of the failure or alleged failure of any
person or entity (including Grantee, its contractor and subcontractors) to pay prevailing wages as
determined pursuant to Labor Code Sections 1720 et seq., to hire apprentices in accordance with
Labor Code Sections 1777.5 et seq., and the implementing regulations of the DIR or comply with
the other applicable provisions of Labor Code Sections 1720 et seq., and the implementing
regulations of the DIR in connection with construction of the Improvements or any other work
undertaken or in connection with the Property. This Section 3.3(b) shall survive the repayment
(if any) of the Agency Grant, and the expiration of the Term.
Section 3.4 Relocation.
If and to the extent that rehabilitation of the improvements on the Property results in the
permanent or temporary displacement of residential tenants, then the Grantee shall comply with
all applicable local, state, and federal statutes and regulations, (including without limitation the
Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended,
California Government Code Section 7260 et seq., and accompanying regulations) with respect
to relocation planning, advisory assistance, and payment of monetary benefits. The Grantee shall
be solely responsible for payment of any relocation benefits to any displaced persons and any
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other obligations associated with complying with such relocation laws. The Grantee shall defend
(with counsel reasonably acceptable to the Agency and City) the Agency and City against any
claim for damages, compensation, fines, penalties, relocation payments or other amounts arising
out of the failure or alleged failure of any person or entity (including the Grantee, the City or the
Agency) to satisfy relocation obligations related to the development of the Property. This
obligation to indemnify shall survive termination of this Agreement.
Section 3.5 Equal Opportunity.
During the rehabilitation of the Improvements there shall be no discrimination on the
basis of race, color, creed, religion, age, sex, sexual orientation, marital status, national origin,
ancestry, or disability in the hiring, firing, promoting, or demoting of any person engaged in the
construction work.
Section 3.6 Progress ss Re orts.
Until such time as the Grantee has completed rehabilitation of the improvements on the
Property, the Grantee shall provide the Agency with quarterly progress reports regarding the
status of the rehabilitation of the Improvements.
Section 3.7 Construction Responsibilities.
(a) It shall be the responsibility of the Grantee to coordinate and schedule the
work to be performed so that commencement and completion of construction will take place in
accordance with this Agreement.
(b) The Grantee shall be solely responsible for all aspects of the Grantee's
conduct in connection with the Property, including (but not limited to) the quality and suitability
of the plans and specifications, the supervision of construction work, and the qualifications,
financial condition, and performance of all architects, engineers, contractors, subcontractors,
suppliers, consultants, and property managers. Any review or inspection undertaken by the
Agency with reference to the Property is solely for the purpose of determining whether the
Grantee is properly discharging its obligations to the Agency, and should not be relied upon by
the Grantee or by any third parties as a warranty or representation by the Agency as to the quality
of the design or construction of the Property and does not relieve the Grantee, or its consultants,
from any applicable requirement to obtain City approval and/or inspections.
Section 3.8 Mechanics Liens, Stop Notices, and Notices of Completion.
(a) If any claim of lien is filed against the Property or a stop notice affecting
the Agency Grant is served on the Agency or any other lender or other third party in connection
with the Property, then the Grantee shall, within twenty (20) days after such filing or service,
either pay and fully discharge the lien or stop notice, effect the release of such lien or stop notice
by delivering to the Agency a surety bond from a surety acceptable to the Agency in sufficient
form and amount, or provide the Agency with other assurance satisfactory to the Agency that the
claim of lien or stop notice will be paid or discharged.
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(b) If the Grantee fails to discharge any lien, encumbrance, charge, or claim in
the manner required in this Section, then in addition to any other right or remedy, the Agency
may (but shall be under no obligation to) discharge such lien, encumbrance, charge, or claim at
the Grantee's expense. Alternately, the Agency may require the Grantee to immediately deposit
with the Agency the amount necessary to satisfy such lien or claim and any costs, pending
resolution thereof. The Agency may use such deposit to satisfy any claim or lien that is
adversely determined against the Grantee.
(c) The Grantee shall file a valid notice of cessation or notice of completion
upon cessation of construction on the Property for a continuous period of thirty (30) days or
more, and take all other reasonable steps to forestall the assertion of claims of lien against the
Property. The Grantee authorizes the Agency, but without any obligation, to record any notices
of completion or cessation of labor, or any other notice that the Agency deems necessary or
desirable to protect its interest in the Property and Property.
Section 3.9 Inspections.
The Grantee shall permit and facilitate, and shall require its contractors to permit and
facilitate, observation and inspection at the Property by the Agency and by public authorities
during reasonable business hours for the purposes of determining compliance with this
Agreement. Such inspections do not relieve Grantee, or its contractors, from any applicable
requirement to obtain City inspections in connection with the rehabilitation of the improvements
on the Property.
Section 3.10 Information.
The Grantee shall provide any information reasonably requested by the Agency in
connection with the Property.
Section 3.11 Records.
(a) The Grantee shall maintain complete, accurate, and current records
pertaining to the Property for a period of five (5) years after the creation of such records and
shall permit any duly authorized representative of the Agency to inspect and copy such records.
Such records shall include all invoices, receipts, and other documents related to expenditures
from the Agency Grant funds. Records must be kept accurate and current.
(b) The Agency shall notify the Grantee of any records it deems insufficient.
The Grantee shall have twenty-one (21) calendar days after the receipt of such a notice to correct
any deficiency in the records specified by the Agency in such notice, or if a period longer than
twenty-one (2 1) days is reasonably necessary to correct the deficiency, then the Grantee shall
begin to correct the deficiency within twenty-one (2 1) days and correct the deficiency as soon as
reasonably possible.
Section 3.12 Audits.
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The Grantee shall make available for examination at reasonable intervals and during
normal business hours to Agency all books, accounts, reports, files, and other papers or property
with respect to all matters covered by this Agreement, and shall permit Agency to audit,
examine, and make excerpts or transcripts from such records. Agency may make audits of any
conditions relating to this Agreement.
Section 3.13 Hazardous Materials.
(a) The Grantee shall keep and maintain the Property in compliance with, and
shall not cause or permit the Property to be in violation of any federal, state or local laws,
ordinances or regulations relating to industrial hygiene or to the environmental conditions on,
under or about the Property including, but not limited to, soil and ground water conditions. The
Grantee shall not use, generate, manufacture, store or dispose of on, under, or about the Property
or transport to or from the Property any flammable explosives, radioactive materials, hazardous
wastes, toxic substances or related materials, including without limitation, any substances
defined as or included in the definition of "hazardous substances," hazardous wastes,"
"hazardous materials," or "toxic substances" under any applicable federal or state laws or
regulations (collectively referred to hereinafter as "Hazardous Materials") except such of the
foregoing as may be used in rehabilitation and/or operation of the Property or customarily kept
and used in and about residential property of this type.
(b) The Grantee shall immediately advise the Agency in writing if at any time
it receives written notice of (i) any and all enforcement, cleanup, removal or other governmental
or regulatory actions instituted, completed or threatened against the Grantee or the Property
pursuant to any applicable federal, state or local laws, ordinances, or regulations relating to any
Hazardous Materials, ("Hazardous Materials Law"); (ii) all claims made or threatened by any
third party against the Grantee or the Property relating to damage, contribution, cost recovery
compensation, loss or injury resulting from any Hazardous Materials (the matters set forth in
clauses (i) and (ii) above are hereinafter referred to as "Hazardous Materials Claims"); and (iii)
the Grantee's discovery of any occurrence or condition on any real property adjoining or in the
vicinity of the Property that could cause the Property or any part thereof to be classified as
"border -zone property" under the provision of California Health and Safety Code, Sections
25220 et sem., or any regulation adopted in accordance therewith, or to be otherwise subject to
any restrictions on the ownership, occupancy, transferability or use of the Property under any
Hazardous Materials Law.
(c) The Agency shall have the right to join and participate in, as a party if it so
elects, any legal proceedings or actions initiated in connection with any Hazardous Materials
Claims and to have its reasonable attorneys' fees in connection therewith paid by the Grantee.
The Grantee shall indemnify and hold harmless the Agency and the City and the City Council,
Agency Board, directors, officers, employees, agents, successors and assigns from and against
any loss, damage, cost, expense or liability directly or indirectly arising out of or attributable to
the use, generation, storage, release, threatened release, discharge, disposal, or presence of
Hazardous Materials on, under, or about the Property including without limitation: (a) all
foreseeable consequential damages; (b) the costs of any required or necessary repair, cleanup or
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detoxification of the Property and the preparation and implementation of any closure, remedial or
other required plans; and (c) all reasonable costs and expenses incurred by the Agency in
connection with clauses (a) and (b), including but not limited to reasonable attorneys' fees. This
obligation to indemnify shall survive termination of this Agreement.
(d) Without the Agency's prior written consent, which shall not be
unreasonably withheld, the Grantee shall not take any remedial action in response to the presence
of any Hazardous Materials on, under or about the Property, nor enter into any settlement
agreement, consent decree, or other compromise in respect to any Hazardous Material Claims,
which remedial action, settlement, consent decree or compromise might, in the Agency's
reasonable judgment, impair the value of the Agency's security hereunder; provided, however,
that the Agency's prior consent shall not be necessary in the event that the presence of Hazardous
Materials on, under, or about the Property either poses an immediate threat to the health, safety
or welfare of any individual or is of such a nature that an immediate remedial response is
necessary and it is not reasonably possible to obtain the Agency's consent before taking such
action, provided that in such event the Grantee shall notify the Agency as soon as practicable of
any action so taken. The Agency agrees not to withhold its consent, where such consent is
required hereunder, if either (i) a particular remedial action is ordered by a court of competent
jurisdiction, (ii) the Grantee will or may be subjected to civil or criminal sanctions or penalties if
it fails to take a required action; (iii) the Grantee establishes to the reasonable satisfaction of the
Agency that there is no reasonable alternative to such remedial action which would result in less
impairment of the Agency's security hereunder; or (iv) the action has been agreed to by the
Agency.
Section 3.14 Maintenance and Damage.
(a) During the course of its ownership of the Property, Grantee shall maintain
the Property and the Property in good repair and in a neat, clean and orderly condition. If there
arises a condition in contravention of this requirement, and if Grantee has not cured such
condition within thirty (30) days after receiving a notice from the Agency of such a condition,
then in addition to any other rights available to the Agency, the Agency shall have the right to
perform all acts necessary to cure such condition, and to establish or enforce a lien or other
encumbrance against the Property.
(b) Subject to the requirements of senior lenders, and if economically feasible
in the Agency's reasonable judgment after consultation with the Grantee, if any improvement
now or in the future on the Property is damaged or destroyed while Grantee owns the Property,
then Grantee shall, at its cost and expense, diligently undertake to repair or restore such
improvement consistent with the plans and specifications approved by the Agency with such
changes as have been approved by the Agency. Such work or repair shall be commenced no
later than the later of one hundred twenty (120) days, or such longer period approved by the
Agency in writing, after the damage or loss occurs or thirty (30) days following receipt of the
insurance proceeds, and shall be complete within one (1) year thereafter. Any insurance
proceeds collected for such damage or destruction shall be applied to the cost of such repairs or
restoration and, if such insurance proceeds shall be insufficient for such purpose, then Grantee
shall make up the deficiency.
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Section 3.15 Fees and Taxes.
The Grantee shall be solely responsible for payment of all fees, assessments, taxes,
charges, and levies imposed by any public authority or utility company with respect to the
Property or the Property to the extent owned by the Grantee, and shall pay such charges prior to
delinquency. However, the Grantee shall not be required to pay and discharge any such charge
so long as (a) the legality thereof is being contested diligently and in good faith and by
appropriate proceedings, and (b) if requested by the Agency, the Grantee deposits with the
Agency any funds or other forms of assurance that the Agency in good faith from time to time
determines appropriate to protect the Agency from the consequences of the contest being
unsuccessful.'
Section 3.16 Notice of Litigation.
The Grantee shall promptly notify the Agency in writing of any litigation known to
Grantee affecting the Grantee or the Property and of any claims or disputes that involve a
material risk of litigation.
Section 3.17 Maintenance of Property as Affordable Housing.
(a) Promptly following the completion of rehabilitation of the improvements
on the Property, Grantee agrees to offer the Property for sale only to Very Low Income
Households at an Affordable Ownership Price. The Grantee shall adhere to the requirements for
eligibility adopted by the City and Agency and specified in Exhibit C attached hereto. Selection
of eligible Very Low Income Households falling within any of the priorities established in
Exhibit C shall be determined by a drawing or other equitable method mutually agreed upon by
the Agency and Grantee and administered by the Grantee. /Dd uou want M1- 4 io eMifu
(b) Prior to the sale of the Property, Grantee shall ensure that:
(1) The buyer and the Agency execute the Resale Agreement and the
Notice of Affordability Restrictions in the form provided by the Agency. The escrow
instructions shall stipulate that the Resale Agreement and the Notice of Affordability Restrictions
shall be recorded against the Property at close of escrow; and that the Resale Agreement and the
Notice of Affordability Restrictions shall be recorded junior only to the lien of the deed of trust
securing the buyer's first mortgage loan, or to a second mortgage loan only if such loan is
provided by a public agency which requires such subordination, or as otherwise approved in
writing by the Agency.
(2) The buyer signs the Note in the form provided by the Agency.
(3) The buyer signs the Deed of Trust to secure performance of the
buyer's covenants under the Resale Agreement and payment of the amounts due under the Note.
The Deed of Trust shall be recorded against the Property, subordinate only to the Resale
Agreement, Notice of Affordability Restrictions, and the lien of the deed of trust securing the
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buyer's first mortgage loan or to a second mortgage loan only if such loan is provided by a
public agency which requires such subordination, or as otherwise approved in writing by the
Agency.
(4) An Agency Request for Notice of Default and Sale is recorded for
each deed of trust recorded at close of escrow.
(5) The buyer signs disclosures in the form provided by the Agency.
(c) Within five (5) days following closing of the sale of the Property, Grantee
shall forward to the Agency copies of the buyer's and seller's settlement statement and all closing
documents, including Resale Agreement, Notice of Affordability Restrictions, the original Note,
Deed of Trust, Request(s) for Notice of Default and Sale, and disclosures executed in connection
with the sale.
(d) The Agency shall release the Property from the burdens of this Agreement
when it is: (i) sold to a Very Low Income Household in compliance with this Agreement; and (ii)
a Resale Agreement, Deed of Trust, Notice of Affordability Restrictions, and Request for Notice
of Default are recorded against the Affordable Unit.
Section 3.18 Non -Discrimination.
The Grantee covenants by and for itself and its successors and assigns that there shall be
no discrimination against or segregation of a person or of a group of persons on account of race,
color, religion, creed, sex, sexual orientation, marital status, familial status, ancestry or national
origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property,
nor shall the Grantee or any person claiming under or through the Grantee establish or permit
any such practice or practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the
Property.
Section 3.19 Mandatory Language in All Subsequent Deeds, Leases and Contracts.
All deeds, leases or contracts made or entered into by the Grantee, its successors or
assigns, as to the transfer of any portion of the Property shall contain therein the following
language:
(a) In Deeds:
"(1) Grantee herein covenants by and for itself, its successors and assigns,
and all persons claiming under or through them, that there shall be no
discrimination against or segregation of, any person or group of persons
on account of any basis listed in subdivision (a) and (d) of Section 12955
of the Government Code, as those bases are defined in Sections 12926,
12926. 1, subdivision (m) and paragraph (1) of subdivision (p) of Section
12955 and Section 12955.2 of the Government Code, in the sale, lease,
sublease, transfer, use, occupancy, tenure or enjoyment of the property
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herein conveyed, nor shall the grantee or any person claiming under or
through the grantee, establish or permit any practice or practices of
discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, subtenants, sublessees or
vendees in the property herein conveyed. The foregoing covenant shall
run with the land.
(2) Notwithstanding paragraph (1), with respect to familial status,
paragraph (1) shall not be construed to apply to housing for older persons,
as defined in Section 12955.9 of the Government Code. With respect to
familial status, nothing in paragraph (1) shall be construed to affect
Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code,
relating to housing for senior citizens. Subdivision (d) of Section 51 and
Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of
Section 12955 of the Government Code shall apply to paragraph (1)."
(b) In Leases:
"(1) Lessee herein covenants by and for itself, its successors and assigns,
and all persons claiming under or through them, that there shall be no
discrimination against or segregation of, any person or group of persons
on account of any basis listed in subdivision (a) and (d) of Section 12955
of the Government Code, as those bases are defined in Sections 12926,
12926. 1, subdivision (m) and paragraph (1) of subdivision (p) of Section
12955 and Section 12955.2 of the Government Code in the leasing,
subleasing, transferring, use, occupancy, tenure or enjoyment of the
premises herein leased nor shall the lessee or any person claiming under or
through the lessee, establish or permit any such practice or practices of
discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, sublessees, subtenants, or
vendees in the premises herein leased.
(2) Notwithstanding paragraph (1), with respect to familial status,
paragraph (1) shall not be construed to apply to housing for older persons,
as defined in Section 12955.9 of the Government Code. With respect to
familial status, nothing in paragraph (1) shall be construed to affect
Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code,
relating to housing for senior citizens. Subdivision (d) of Section 51 and
Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of
Section 12955 of the Government Code shall apply to paragraph (1)."
(c) In Contracts:
"(1)There shall be no discrimination against or segregation of, any person
or group of persons on account of any basis listed in subdivision (a) and
(d) of Section 12955 of the Government Code, as those bases are defined
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in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of
subdivision (p) of Section 12955 and Section 12955.2 of the Government
Code in the sale, lease, sublease, transfer, use, occupancy, tenure or
enjoyment of the property nor shall the transferee or any person claiming
under or through the transferee establish or permit any such practice or
practices of discrimination or segregation with reference to the selection,
location, number, use or occupancy of tenants, lessees, subtenants,
sublessees or vendees of the land.
(2) Notwithstanding paragraph (1), with respect to familial status,
paragraph (1) shall not be construed to apply to housing for older persons,
as defined in Section 12955.9 of the Government Code. With respect to
familial status, nothing in paragraph (1) shall be construed to affect
Sections 51.2, 51.3, 51.4, 51.10, 51.11, and 799.5 of the Civil Code,
relating to housing for senior citizens. Subdivision (d) of Section 51 and
Section 1360 of the Civil Code and subdivisions (n), (o), and (p) of
Section 12955 of the Government Code shall apply to paragraph (1)."
Section 3.20 Insurance Requirements.
The Grantee shall maintain the following insurance coverage throughout the Term:
(a) Workers' Compensation insurance to the extent required by law, including
Employer's Liability coverage, with limits not less than One Million Dollars ($1,000,000) each
accident, including equivalent coverage of volunteers utilized by Grantee in its rehabilitation of
the improvements on the Property.
(b) Commercial General Liability insurance with limits not less than One
Million Dollars ($1,000,000) each occurrence combined single limit for Bodily Injury and
Property Damage, including coverage for Contractual Liability, Personal Injury, Broadform
Property Damage, and Products and Completed Operations.
(c) Comprehensive Automobile Liability insurance with limits not less than
One Million Dollars ($1,000,000) each occurrence combined single limit for Bodily Injury and
Property Damage, including coverage for owned, non -owned and hired vehicles, as applicable;
provided, however, that if the Grantee does not own or lease vehicles for purposes of this
Agreement, then no automobile insurance shall be required.
(d) Property insurance, including during the course of construction builder's
risk insurance, covering the Property, in form appropriate for the nature of such property,
covering all risks of loss, excluding earthquake, for one hundred percent (100%) of the
replacement value, with deductible, if any, acceptable to the Agency, naming the Agency as a
Loss Payee, as its interests may appear. Flood insurance shall be obtained if required by
applicable federal regulations.
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(e) The Grantee shall cause any general contractor or agent working on the
Property under direct contract with the Grantee to maintain insurance of the types and in at least
the minimum amounts described in subsections (a), (b), and (c) above, and shall require that such
insurance shall meet all of the general requirements of subsections (e), (f), and (g) below,
including, without limitation, the requirement of subsection (f). Subcontractors working on the
Property under indirect contract with the Grantee shall be required to maintain the insurance
described in subsections (a), (b), and (c) above. Liability and Comprehensive Automobile
Liability insurance to be maintained by such contractors and agents pursuant to this subsection
shall name as additional insureds the Agency, the City, their officers, agents, employees and
members of the City Council and Agency Board.
(f) The required insurance shall be provided under an occurrence form, and
the Grantee shall maintain such coverage continuously so long as this Agreement is in effect.
Should any of the required insurance be provided under a form of coverage that includes an
annual aggregate limit or provides that claims investigation or legal defense costs be included in
such annual aggregate limit, such annual aggregate limit shall be three times the occurrence
limits specified above.
(g) Commercial General Liability and Property insurance policies shall be
endorsed to name as an additional insured the City, the Agency, and their officers, agents,
employees and members of the City Council and Agency Board.
(h) All policies and bonds shall contain (a) the agreement of the insurer to
give the Agency at least thirty (30) days' notice prior to cancellation (including, without
limitation, for non payment of premium) or any material change in said policies; (b) an
agreement that such policies are primary and non contributing with any insurance that may be
carried by the Agency; (c) a provision that no act or omission of the Grantee shall affect or limit
the obligation of the insurance carrier to pay the amount of any loss sustained; and (d) a waiver
by the insurer of all rights of subrogation against the Agency and its authorized parties in
connection with any loss or damage thereby insured against.
ARTICLE 4
ASSIGNMENT AND TRANSFERS
Section 4.1 Definitions.
As used in this Article Four, the term "Transfer" means any total or partial sale, lease,
assignment, or other conveyance, or any trust or power, or any transfer in any other mode or
form, of or with respect to this Agreement or of any part of or interest in the Property, or any
agreement to do any of the foregoing.
Section 4.2 Purpose of Restrictions on Transfer or Assignment.
This Agreement is entered into solely for the purpose of the Grantee's rehabilitation and
sale of the Property in accordance with the terms of this Agreement. The qualifications and
identity of the Grantee are of particular concern to the Agency, in view of:
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(a) The public aids that have been made available by law and by the
government for the purpose of making such development possible; and
(b) The reliance by the Agency upon the unique qualifications and ability of
the Grantee and upon the continuing interest which the Grantee will have in the Property to
assure the successful sale of the Property to Very Low Income Households.
It is because of the qualifications and identity of the Grantee that the Agency is entering
into this Agreement and that Transfers are permitted only as provided in this Agreement.
Section 4.3 Prohibited Transfers.
Except as expressly permitted in this Agreement, the Grantee represents that it has not
made or created, and agrees that it will not make or create or suffer to be made or created, any
Transfer, either voluntarily or by operation of law, without the prior written approval of the
Agency.
Any Transfer made in contravention of this Section 4.3 shall at the Agency's discretion be
void and shall be deemed to be a default under this Agreement, whether or not the Grantee knew
of or participated in such Transfer.
Section 4.4 Permitted Transfers Without Prior Agency Approval.
The only Transfer permitted at any time without the prior approval of the Agency is the
sale of the Property to a Very Low Income Household in compliance with Section 3.17.
Section 4.5 Permitted Transfers With Prior Approval.
Except as permitted under Section 4.4, any Transfer shall be permitted only after (i) the
Agency, in its sole discretion, has delivered to the Grantee its prior written approval of such
Transfer, and (ii) the transferee has assumed the Grantee's obligations under this Agreement by
signing an assignment and assumption agreement, in a form prepared by the Agency, and such
other reasonable documentation as the Agency may reasonably require to evidence such
transferee's assumption of the Grantee's duties and obligations under the Grant Documents.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF THE GRANTEE
Section 5.1 Representations and Warranties.
The Grantee hereby represents and warrants to the Agency as follows:
(a) Organization. The Grantee is a duly organized, validly existing California
nonprofit public benefit corporation and is in good standing under the laws of the State of
California and has the power and authority to own its property and carry on its business as now
being conducted.
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(b) Authority of the Grantee. The Grantee has full power and authority to
execute and deliver this Agreement and to make and accept the borrowings contemplated
hereunder, to execute and deliver the Grant Documents and all other documents or instruments
executed and delivered, or to be executed and delivered, pursuant to this Agreement, and to
perform and observe the terms and provisions of all of the above.
(c) Authority of Persons Executing Documents. This Agreement and the
Grant Documents and all other documents or instruments executed and delivered, or to be
executed and delivered, pursuant to this Agreement have been executed and delivered by persons
who are duly authorized to execute and deliver the same for and on behalf of the Grantee, and all
actions required under the Grantee's organizational documents and applicable governing law for
the authorization, execution, delivery and performance of this Agreement and the Grant
Documents and all other documents or instruments executed and delivered, or to be executed and
delivered, pursuant to this Agreement, have been duly taken.
(d) Valid Binding Agreements. This Agreement and the Grant Documents
and all other documents or instruments which have been executed and delivered pursuant to or in
connection with this Agreement constitute or, if not yet executed or delivered, will when so
executed and delivered constitute, legal, valid and binding obligations of the Grantee enforceable
against it in accordance with their respective terms.
(e) No Breach of Law or Agreement. Neither the execution nor delivery of
this Agreement and the Grant Documents or of any other documents or instruments executed and
delivered, or to be executed or delivered, pursuant to this Agreement, nor the performance of any
provision, condition, covenant or other term hereof or thereof, will conflict with or result in a
breach of any statute, rule or regulation, or any judgment, decree or order of any court, board,
commission or agency whatsoever binding on the Grantee, or any provision of the organizational
documents of the Grantee, or will conflict with or constitute a breach of or a default under any
agreement to which the Grantee is a party, or will result in the creation or imposition of any lien
upon any assets or property of the Grantee, other than liens established pursuant hereto.
(f) Compliance With Laws; Consents and Approvals. The rehabilitation of
the Property will comply with all applicable laws, ordinances, rules and regulations of federal,
state and local governments and agencies and with all applicable directions, rules and regulations
of the fire marshal, health officer, building inspector and other officers of any such government
or agency.
(g) Pending Proceedings. The Grantee is not in default under any law or
regulation or under any order of any court, board, commission or agency whatsoever, and there
are no claims, actions, suits or proceedings pending or, to the knowledge of the Grantee,
threatened against or affecting the Grantee or the Property, at law or in equity, before or by any
court, board, commission or agency whatsoever which might, if determined adversely to the
Grantee, materially affect the Grantee's ability to repay the Agency Grant or impair the security
to be given to the Agency pursuant hereto.
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(h) Title to Land. At the time of recordation of the Memorandum of Grant
Agreement, the Grantee will have good and marketable fee title to the Property and there will
exist thereon or with respect thereto no mortgage, lien, pledge or other encumbrance of any
character whatsoever other than liens for current real property taxes and assessments not yet due
and payable, those liens described in LI(f) of this Agreement, and liens in favor of the Agency
or approved in writing by the Agency.
(i) Financial Statements. Any financial statements of the Grantee and other
financial data and information furnished by the Grantee to the Agency fairly present the
information contained therein as of the date thereof. As of the date of this Agreement, there has
not been any adverse, material change in the financial condition of the Grantee from that shown
by such financial statements and other data and information.
0) Sufficient Funds. The Grantee holds sufficient funds and/or binding
commitments for sufficient funds to complete the rehabilitation of the Property.
ARTICLE 6
DEFAULT AND REMEDIES
Section 6.1 Events of Default.
Each of the following shall constitute a 'Default' by the Grantee under this Agreement:
(a) Failure to Construct. Failure of the Grantee to commence and prosecute to
completion, rehabilitation of the Property within the time frames set forth in Article 3 above.
(b) Breach of Covenants. Failure by the Grantee to duly perform, comply
with, or observe any of the conditions, terms, or covenants of any of the Grant Documents, and
such failure having continued uncured for thirty (30) days after receipt of written notice thereof
from the Agency to the Grantee or, if the breach cannot be cured within thirty (30) days, the
Grantee shall not be in breach so long as the Grantee is diligently undertaking to cure such
breach and such breach is cured within sixty (60) days; provided, however, that if a different
period or notice requirement is specified under any other section of this Article 6, the specific
provisions shall control.
(c) Default Under Other Loans. A default is declared under the Approved
Financing by the lender of such Approved Financing (subject to applicable notice and cure
periods).
(d) Liens on Property and the Property. There shall be filed any claim of lien
(other than liens approved in writing by the Agency) against the Property or any part thereof, or
any interest or right made appurtenant thereto, or the service of any notice to withhold proceeds
of the Agency Grant and the continued maintenance of said claim of lien or notice to withhold
for a period of twenty (20) days without discharge or satisfaction thereof or provision therefore
(including, without limitation, the posting of bonds) satisfactory to the Agency.
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(e) Unauthorized Transfer. Any Transfer other than as permitted by Article 4.
(f) Representation or Warranty Incorrect. Any representation or warranty of
the Grantee contained in this Agreement, or in any application, financial statement, certificate, or
report submitted to the Agency in connection with any of the Grant Documents, proves to have
been incorrect in any material and adverse respect when made.
Section 6.2 Remedies.
The occurrence of any Default hereunder following the expiration of all applicable notice
and cure periods will, either at the option of the Agency or automatically where so specified,
relieve the Agency of any obligation to make or continue the Agency Grant and shall give the
Agency the right to proceed with any and all remedies at law or in equity, including but not
limited to the following:
(a) Specific Performance. The Agency shall have the right to mandamus or
other suit, action or proceeding at law or in equity to require the Grantee to perform its
obligations and covenants under the Grant Documents or to enjoin acts on things which may be
unlawful or in violation of the provisions of the Grant Documents.
(b) Right to Cure at the Grantee's Expense. The Agency shall have the right
(but not the obligation) to cure any monetary default by the Grantee under a loan other than the
Agency Grant. The Grantee agrees to reimburse the Agency for any funds advanced by the
Agency to cure a monetary default by the Grantee upon demand therefore, together with interest
thereon at the lesser of the maximum rate permitted by law or ten percent (10%) per annum from
the date of expenditure until the date of reimbursement.
Section 6.3 Right of Contest.
Grantee shall have the right to contest in good faith any claim, demand, levy, or
assessment the assertion of which would constitute a Default hereunder. Any such contest shall
be prosecuted diligently and in a manner unprejudicial to the Agency or the rights of the Agency
hereunder.
Section 6.4 Remedies Cumulative.
No right, power, or remedy given to the Agency by the terms of this Agreement or the
Grant Documents 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 Agency by the terms of any such instrument, or by any statute or
otherwise against the Grantee and any other person. Neither the failure nor any delay on the part
of the Agency to exercise any such rights and remedies shall operate as a waiver thereof, nor
shall any single or partial exercise by the Agency of any such right or remedy preclude any other
or further exercise of such right or remedy, or any other right or remedy.
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ARTICLE 7
GENERAL PROVISIONS
Section 7.1 Relationship of Parties.
Nothing contained in this Agreement shall be interpreted or understood by any of the
parties, or by any third persons, as creating the relationship of employer and employee, principal
and agent, limited or general partnership, or joint venture between the Agency and the Grantee or
the Grantee's agents, employees or contractors, and the Grantee shall at all times be deemed an
independent contractor and shall be wholly responsible for the manner in which it or its agents,
or both, perform the services required of it by the terms of this Agreement. Grantee has and
retains the right to exercise full control of employment, direction, compensation, and discharge
of all persons assisting in the performance of services under the Agreement. In regards to the
development of the Property, the Grantee shall be solely responsible for all matters relating to
payment of its employees, including compliance with Social Security, withholding and all other
laws and regulations governing such matters, and shall include requirements in each contract that
contractors shall be solely responsible for similar matters relating to their employees. The
Grantee agrees to be solely responsible for its own acts and those of its agents and employees.
Section 7.2 No Claims.
Nothing contained in this Agreement shall create or justify any claim against the Agency,
by any person the Grantee may have employed or with whom the Grantee 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 development of the Property, and the Grantee shall
include similar requirements in any contracts entered into for the development of the Property.
Section 7.3 Amendments.
No alteration or variation of the terms of this Agreement shall be valid unless made in
writing by the Parties.
Section 7.4 Entire Understanding of the Parties.
This Agreement constitutes the entire understanding and agreement of the Parties with
respect to the Agency Grant.
Section 7.5 Indemnification.
Except as directly caused by the Agency's gross negligence or willful misconduct, the
Grantee agrees to indemnify, protect, hold harmless and defend (by counsel reasonably
satisfactory to the Agency) the Agency, the City and their respective board members, council
members, officers and employees, from all suits, actions, claims, causes of action, costs,
demands, judgments and liens arising out of. (i) the Grantee's performance or non-performance
of its obligations under this Agreement; (ii) the Grantee's ownership of the Property; (iii) the
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development, marketing, and sale of the Property, or (iv), or any documents executed by the
Grantee in connection with the Property. The provisions of this Section 7.5 shall survive
termination of this Agreement.
Section 7.6 Non -Liability of Agency and City Officials, Employees and Agents.
No member, official, employee or agent of the Agency or the City shall be personally
liable to the Grantee, or any successor in interest, in the event of any Default or breach by the
Agency, or for any amount which may become due to the Grantee or its successor or on any
obligation under the terms of this Agreement.
Section 7.7 No Third Party Beneficiaries.
There shall be no third party beneficiaries to this Agreement.
Section 7.8 Action by the Agency.
Except as may be otherwise specifically provided herein, whenever any approval, notice,
direction, consent, request, extension of time, waiver of condition, termination, or other action by
the Agency is required or permitted under this Agreement, such action may be given, made, or
taken by the Agency Executive Director without further approval by the Agency Board, and any
such action shall be in writing. The amount of the Agency Grant may not be increased without
approval of the Agency Board.
Any consents or approvals required under this Agreement shall not be unreasonably
withheld or made, except where it is specifically provided that a sole discretion standard applies.
The Agency Executive Director is also hereby authorized to approve, on behalf of the Agency,
requests by the Grantee for reasonable extensions of time deadlines set forth in this Agreement.
The Agency shall not unreasonably delay in reviewing and approving or disapproving any
proposal by the Grantee made in connection with this Agreement.
Section 7.9 Waivers.
Any waiver by the Agency of any obligation or condition in this Agreement must be in
writing. No waiver will be implied from any delay or failure by the Agency to take action on
any breach or default of the Grantee or to pursue any remedy allowed under this Agreement or
applicable law. Any extension of time granted to the Grantee 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 Agency to any act or omission by the Grantee shall not be construed
to be a consent to any other or subsequent act or omission or to waive the requirement for the
Agency's written consent to future waivers.
Section 7.10 Notices, Demands and Communications.
Formal notices, demands, and communications between the Agency and the Grantee shall
be sufficiently given if and shall not be deemed given unless dispatched by registered or certified
141V01A800102.1 21
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mail, postage prepaid, return receipt requested, or delivered by express delivery service; return
receipt requested, or delivered personally, to the principal office of the Agency and the Grantee
as follows:
Agency:
San Rafael Redevelopment Agency
1313 Fifth Avenue
San Rafael, California 94915-1560
Attention: Director of Economic Development
Grantee:
Habitat for Humanity Greater San Francisco
645 Harrison Street, Suite 201
San Francisco, CA 94107
Attention: Executive Director
Such written notices, demands and communications may be sent in the same manner to such
other addresses as the affected party may from time to time designate by mail as provided in this
Section. Receipt shall be deemed to have occurred on the date shown on a written receipt for
delivery or refusal of delivery.
Section 7.11 Applicable Law and Venue.
This Agreement shall be governed by California law. Any action brought claiming a
breach of this Agreement or interpreting this Agreement shall be brought in Marin County,
California.
Section 7.12 Parties Bound.
Except as otherwise limited herein, the provisions of this Agreement shall be binding
upon and inure to the benefit of the parties and their heirs, executors, administrators, legal
representatives, successors and assigns. This Agreement is intended to run with the land and
shall bind the Grantee and its successors and assigns in the Property and the Property for the
entire Term, and the benefit hereof shall inure to the benefit of the Agency and its successors and
assigns.
Section 7.13 Attorneys' Fees.
If any lawsuit is commenced to enforce any of the terms of this Agreement, the prevailing
party will have the right to recover its reasonable attorneys' fees and costs of suit from the other
party-
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arty-
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Section 7.14 Severability.
If any term of this Agreement is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the provisions shall continue in full force and effect
unless the rights and obligations of the parties have been materially altered or abridged by such
invalidation, voiding or unenforceability.
Section 7.15 Force Majeure.
In addition to specific provisions of this Agreement, performance by either Party shall not
be deemed to be in default where delays or defaults are due to war; insurrection; strikes; lock-
outs; riots; floods; earthquakes; fires; quarantine restrictions; freight embargoes; lack of
transportation; or court order; or any other similar causes (not including lack of funds of the
Grantee or the Grantee's inability to finance the rehabilitation of the Property) beyond the control
or without the fault of the Party claiming an extension of time to perform. An extension of time
for any cause will be deemed granted if notice by the Party claiming such extension is sent to the
other within ten (10) days from the commencement of the cause and the Party granting the
extension agrees to the extension in writing. In no event shall the Agency be required to agree to
cumulative delays in excess of one hundred eighty (180) days.
Section 7.16 Conflict of Interest.
(a) Except for approved eligible administrative or personnel costs, no person
described in Section 7.16(b) below who exercises or has exercised any functions or
responsibilities with respect to the activities funded pursuant to this Agreement or who is in a
position to participate in a decision-making process or gain inside information with regard to
such activities, may obtain a personal or financial interest or benefit from the activity, or have an
interest in any contract, subcontract or agreement with respect thereto, or the proceeds
thereunder, either for themselves or those with whom they have family or business ties, during,
or at any time after, such person's tenure. Grantee shall exercise due diligence to ensure that the
prohibition in this Section 7.16(a) is followed.
(b) The conflict of interest provisions of Section 7.16(a) above apply to any
person who is an employee, agent, consultant, officer, or any immediate family member of such
person, or any elected or appointed official of the Agency, or any person related within the third
degree of such person.
Section 7.17 Title of Parts and Sections.
Any titles of the sections or subsections of this Agreement are inserted for convenience of
reference only and shall be disregarded in interpreting any part of the Agreement's provisions.
Section 7.18 Multiple Originals; Counterpart.
This Agreement maybe executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
141\01\9001011 23
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WHEREFORE, this Agreement has been entered into by the undersigned as of the date
first above written.
GRANTEE:
HABITAT FOR HUMANITY GREATER SAN
FRANCISCO, a California nonprofit public
benefit corporation
LM
Its:
AGENCY:
REDEVELOPMENT AGENCY OF THE CITY OF
SAN RAFAEL, a public body corporate and politic
Its:
24
141\01\800102.1
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EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
141\01\800102.1 A-1
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EXHIBIT B
MEMORANDUM OF GRANT AGREEMENT
RECORDING REQUESTED BY,
AND WHEN RECORDED MAIL TO:
San Rafael Redevelopment Agency
1313 Fifth Avenue
San Rafael, California 94915
Attn: Executive Director
No fee for recording pursuant
to Government Code Section 27383
MEMORANDUM OF GRANT AGREEMENT
THIS MEMORANDUM OF GRANT AGREEMENT is made as of
by and between the San Rafael Redevelopment Agency, a public body, corporate and politic (the
"Agency"), and Habitat for Humanity Greater San Francisco, a California nonprofit public
benefit corporation (the "Owner"), to confirm that the Agency and the Owner have entered into
that certain Grant Agreement by and between the Agency and the Owner dated as of
(the "Grant Agreement"). The Grant Agreement
imposes use restrictions (including occupancy and affordability restrictions) on, and, pursuant to
California Health and Safety Code Section 33334.3(f), this Grant Agreement is being recorded
against the real property in San Rafael, California, described in the attached Exhibit A. The
Grant Agreement is a public document and may be reviewed at the principal office of the
Agency.
AGENCY: SAN RAFAEL REDEVELOPMENT AGENCY,
a public body, corporate and politic
in
Its:
OWNER: HABITAT FOR HUMANITY GREATER SAN
FRANCISCO, a California nonprofit public benefit
corporation
I:
Its:
141 \01\800102.1 B-1
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STATE OF CALIFORNIA
CK�IM01MIZS]aa r\HIM I
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 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
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 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
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EXHIBIT C
ELIGIBILITY REQUIREMENTS AND PRIORITIES
Eligibility Requirements
In determining and certifying eligibility of applicants to purchase the Property, the Grantee shall
adhere to the following criteria:
1. Applicants shall be Very Low Income Households, as defined in this Agreement.
2. The total value of the applicant household's assets may not exceed 75 percent of the sales
price of the unit.
3. The applicant must qualify as a first time homebuyer, defined as not having owned
residential real property within a three-year period preceding purchase of the Property.
9
Selection of Homebuvers
In selecting prospective purchasers from among all eligible applicants, a drawing shall be
conducted, or other equitable method mutually agreed upon by the Agency and the Grantee. The
Agency has determined that the following categories of prospective purchasers shall be given
priority by the Grantee. Each applicant falling within the first priority group shall be considered
prior to any applicant in the second priority group.
1. First priority in the drawing shall go to applicants living or working in Marin County.
2. Second priority in the drawing shall go to all other applicants.
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