Resolution No. 2013-033 (5)RESOLUTION NO. 2013-33
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
VERNON APPROVING A DISPOSITION AND DEVELOPMENT
AGREEMENT BY AND BETWEEN THE CITY OF VERNON AND
META HOUSING CORPORATION
WHEREAS, the City Council of the City of Vernon has adopted
various good governance reform measures to enhance the accountability
and transparency of its government to better provide for the welfare
of its businesses and residents, including a commitment to at least
double the housing stock within the City in order to increase the
population of the City; and
WHEREAS, the City Council desires to provide for the
development of certain real property owned by the City, approximately
2.06 acres in size and located at 4675 52°d Drive in the City (the
"Site"); and
WHEREAS, the City has prepared the form of the attached
Disposition and Development Agreement for the Housing Project (the
"DDA"), which provides for the City to ground lease the Site (the
"Ground Lease") to an entity formed by Meta Housing Corporation (the
"Developer") and for the Developer to develop a housing project (the
"Housing Development") on the Site; and
WHEREAS, the Housing Development will generally consist of a
rental housing complex containing forty-five (45) units, with
associated parking, landscaping and community facilities, which is
intended to implement the City's goals and objectives to provide
decent, safe and sanitary housing for persons and families of low and
moderate income; and
WHEREAS, the City is authorized to lease its real property
to private developers in order to provide housing affordable to
persons and families of low or moderate income, and such leases may
provide for rent at a level below the fair market rental value of the
property; and
WHEREAS, the City has caused an economic analysis of the
fair market value and fair market rental value of the Site to be
conducted, which has concluded that the rent as proposed pursuant to
the DDA and Ground Lease is not less than the fair market rental value
of the Site at the use and with the conditions, covenants and
development costs required by the DDA and Ground Lease; and
WHEREAS, the City is authorized to lease its property for a
term in excess of 55 years, provided that the lease is subject to
periodic review by the City and takes into consideration the then
current market conditions; and
WHEREAS, Article 34 of the California Constitution ("Article
34") provides that no "low rent housing project" shall be "developed,
constructed, or acquired" in any manner by any state public body until
a majority of the qualified electors of the jurisdiction votes to
approve such project; and
WHEREAS, the term "low -rent housing project," as defined in
Article 34, does not apply to the development of privately owned
housing, receiving no ad valorem property tax exemption, other than
exemptions granted pursuant to Revenue and Taxation Code Section 214
(f) or (g), not fully reimbursed to all taxing entities, where not
more than 49 percent of the apartments of the development may be
occupied by persons of low income; and
WHEREAS, the words "develop, construct, or acquire" as used
in Article 34 do not apply to activities of a state public body when
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such body provides assistance to a low -rent housing project and
monitors construction or rehabilitation of such project and compliance
with conditions of such assistance to the extent of carrying out
routine governmental functions, performing conventional activities of
a lender, and imposing constitutionally mandated or statutorily
authorized conditions accepted by a grantee of assistance; and
WHEREAS, no judicial action attacking or otherwise
questioning the validity of the action of a local public entity in
giving final approval to a proposal or application which may result in
housing assistance benefiting persons of low income without obtaining
prior approval pursuant to Article 34 may be brought prior to the
adoption of a resolution or ordinance by the legislative body of the
local public entity approving the proposal or application, nor may any
such action be brought at any time after 60 days from the date of the
adoption of the ordinance or resolution approving the proposal or
application; and
WHEREAS, on February 19, 2013, the City Council adopted
Resolution No. 2013-31, approving a Mitigated Negative Declaration and
a Mitigation Monitoring Reporting Program prepared for the Housing
Development, and specifically including the Housing Development and
the DDA in the Project Description, which Mitigated Negative
Declaration concludes that the Housing Development and the DDA will
have no significant adverse impact on the environment, provided that
the mitigation measures set forth in the Mitigation Monitoring
Reporting Program.are implemented; and
WHEREAS, the City's lease of the Site to the Developer and
the Developer's construction and operation of the Housing Development
pursuant to the terms of the DDA and Ground Lease are in the vital and
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best interest of the City and the health, safety, and welfare of its
residents, and in accord with the public purposes and provisions of
applicable state and local laws.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF VERNON:
SECTION 1: Recitals. The City Council of the City of Vernon
hereby finds and determines that the above recitals are true and
correct.
SECTION 2: Findings. In adopting this resolution, the City
Council of the City of Vernon makes the following findings:
a) A Mitigated Negative Declaration has been prepared in accordance
with the California Environmental Quality Act (CEQA) and the City
has approved the Mitigated Negative Declaration in accordance with,
the requirements of CEQA.
b) The rent payable by the Developer to the. City pursuant to the DDA
and Ground Lease is not less than the fair market rental value of
the Site, at the use and with the conditions, covenants and
development costs required by the DDA and Ground Lease.
c) The Ground Lease contains provisions which permit the City
periodically review the rent payable by the Developer, and to adjust
the rent payable thereunder to the current fair market rental value
of the Site, considering the use and the conditions, covenants and
development costs imposed pursuant to the Ground Lease.
d) The Housing Development is not a "low -rent housing project" as
defined in Article 34, because it is privately owned housing,
receiving no ad valorem property tax exemption, other than
exemptions granted pursuant to Revenue and Taxation Code Section 214
(f) or (g), not fully reimbursed to all taxing entities, and not
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more than 49 percent of the apartments of the Housing Development
are required by the DDA and Ground Lease to be occupied by persons
of low income.
e) The City is not developing, constructing; or acquiring the Housing
Development as defined in Article 34, because it is providing
assistance to the Housing Development and monitoring construction or
rehabilitation of such project and compliance with conditions of
such assistance to the extent of carrying out routine governmental
functions, performing conventional activities of a lender, and
imposing constitutionally mandated or statutorily authorized
conditions accepted by a grantee of assistance.
f) This Resolution is intended to be a resolution of the City Council
approving a proposal or application which may result in housing
assistance benefiting persons of low income without obtaining prior
approval pursuant to Article 34.
SECTION 3: Action. The City Council of the City of Vernon
hereby approves the DDA in substantially the form presented to the
City Council, and attached hereto. The Mayor or Mayor Pro-Tem is
hereby authorized and directed to execute the DDA for and on behalf
of, the City of Vernon, and the Interim City Clerk, or Deputy City
Clerk, shall attest thereto.
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SECTION 4: The Interim City Clerk, or Deputy City Clerk, of
the City of Vernon shall certify to the passage, approval and adoption
of this resolution, and the Interim City Clerk, or Deputy City Clerk,
of the City of Vernon shall cause this resolution and the Interim City
Clerk's, or Deputy City Clerk's, certification to be entered in the
File of Resolutions of the Council of this City.
ATTEST:
APPROVED AND ADOPTED this 19th day of February, 2013.
C�
Name: William J. Davis
Title: Mayor /
/ Deputy City Clerk
APPROVED AS TO FORM:
I ? �,ctj,3
Nichola George Rodriguez,
City Attorney
Jon E. Goetf, E4q.
Kronic Moskovitz, Tiedemann & Girard
Specia Counsel to City
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STATE OF CALIFORNIA )
) ss
COUNTY OF LOS ANGELES )
I. Ana Barcia ��} ;m •I --T Deputy City Clerk of
the City of Vernon, do hereby certify that the foregoing Resolution,
being Resolution No. 2013-33, was duly passed, approved and adopted by
the City Council of the City of Vernon at a regular meeting of the City
Council duly held on Tuesday, February 19, 2013, and thereafter was
duly signed by the Mayor or Mayor Pro-Tem of the City of Vernon.
Executed this V5 day of February, 2013, at Vernon, California.
(SEAL)
N `
a Barcia
interi-M"'�eTie/ Deputy City Clerk
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ATTACHMENT TO RESOLUTION NO. 2013-33
DISPOSITION AND DEVELOPMENT AGREEMENT
DISPOSITION AND DEVELOPMENT AGREEMENT
By and Between the
CITY OF VERNON
and
META HOUSING CORPORATION
1017942.5
Attachment No. 1
Attachment No. 2
Attachment No. 3
Attachment No. 4
Attachment No. 5
Attachment No. 6
Attachment No. 7
Attachment No. 8
Attachment No. 9
1017942.5
ATTACHMENTS
Site Map
Site Legal Description
Ground Lease
List of Environmental Studies and Reports
Scope of Development
Schedule of Performance
Prevailing Wage and Public Works Requirements
Property Site Management Plan
Regulatory Agreement
DISPOSITION AND DEVELOPMENT AGREEMENT
THIS DISPOSITION AND DEVELOPMENT AGREEMENT (the "Agreement") is
entered into as of February 19, 2013, by and between the CITY OF VERNON, a California
charter city and municipal corporation (the "City"), and META HOUSING CORPORATION,
a California nonprofit public benefit corporation (the "Developer").
RECITALS
The following recitals are a substantive part of this Agreement:
A. The City Council has adopted various good governance reform measures to enhance
the accountability and transparency of its government to better provide for the welfare of its
businesses and residents, including a commitment to at least double the housing stock within the City
in order to increase the population of the City.
B. The City and the Developer desire to develop certain real property owned by the
City, as shown on the Site Map which is attached hereto as Attachment No. 1 and incorporated
herein, and as more fully described in the Legal Description which is attached hereto as
Attachment No. 2 and incorporated herein (the "Site'). The Site is approximately 2.06 acres in
size and is located at 4675 52"d Drive in the City of Vernon.
C. The parties desire by this Agreement for the City to ground lease the Site to the
Developer and for the Developer to agree to develop a housing project (the "Housing
Development") on the Site. The Housing Development will generally consist of a rental housing
complex containing forty-five (45) units, with associated parking, landscaping and community
facilities. Such development is intended to implement the City's goals and objectives to provide
decent, safe and sanitary housing for persons and families of low and moderate income.
D. The lease of the Site and the Developer's construction and operation of the
Housing Development pursuant to the terms of this Agreement, are in the vital and best interest
of the City and the health, safety, and welfare of its residents, and in accord with the public
purposes and provisions of applicable state and local laws.
E. It is the intent of the parties to maximize the leverage of City participation by
making every effort to secure sources of non -local subsidies for the Housing Development.
Accordingly, this Agreement requires the Developer to submit up to two applications to the
California Tax Credit Allocation Committee ("TCAC") for competitive 9% Tax Credits as may
be necessary to secure an allocation of 9% Tax Credits for the Housing Development. This
Agreement has been structured specifically to accommodate a 9% Tax Credit financing structure.
In addition to Tax Credits, the Developer may seek to obtain allocations of funding for the
Housing Development from such sources as the Affordable Housing Program of the Federal
Home Loan Bank ("AHP"), from the County of Los Angeles from its HOME Investment
Partnerships Act ("HOME Program") funds, and the State of California.
F. On February 5, 2013, the City Council adopted Resolution No. _ approving a
Mitigated Negative Declaration and a Mitigation Monitoring Reporting Program prepared for the
Housing Development, and specifically including the Housing Development and this Agreement in
1017942.5
the Project Description. The Mitigated Negative Declaration concludes that the Housing
Development and this Agreement will have no significant adverse impact on the environment,
provided that the mitigation measures set forth in the Mitigation Monitoring Reporting Program are
implemented.
NOW, THEREFORE, City and the Developer hereby agree as follows:
100. DEFINITIONS
"ADA" shall mean the Americans with Disabilities Act of 1990, as the same may from
time to time be amended (42 U.S.C. § 12101, et seq.).
"Affordability Period" shall mean the duration of the affordable housing requirements
which are set forth in this Agreement and the Regulatory Agreement, as set forth in Section 503
hereof.
"Affordable Rent" shall have the meaning set forth in Section 505 hereof.
"Agreement" means this Disposition and Development Agreement between City and the
Developer.
"Best Knowledge" is defined in Section 206.1 hereof.
"City" means the City of Vernon, a charter city and municipal corporation, and any
assignee of or successor to its rights, powers and responsibilities.
"City's Conditions Precedent" means the conditions precedent to the Commencement of
the Ground Lease for the benefit of City, as set forth in Section 203.1 hereof.
"Commencement" means the commencement of the Ground Lease, as set forth in
Section 203.3 hereof.
"Commencement Date" means the date of the Commencement, as set forth in Section
203.3 hereof.
"Condition of Title" is defined in Section 202.1 hereof.
"County" shall mean the County of Los Angeles, California.
"CPT' means the Consumer Price Index of the Bureau of Labor Statistics of the U.S.
Department of Labor for All Urban Consumers, Los Angeles — Riverside — Orange County,
California (all items), 1982-84 = 100, or its successor index.
"Default" means the failure of a party to perform any action or covenant required by this
Agreement within the time periods provided herein following notice and opportunity to cure, as
set forth in Section 601 hereof.
"Developer" means Meta Housing Corporation, a California corporation, or its permitted
assignee.
1017942.5
"Developer's Conditions Precedent" means the conditions precedent to the
Commencement of the Ground Lease for the benefit of Developer, as set forth in Section 203.2
hereof.
"Development Agreement" means that Development Agreement between City and
Developer, dated as of February 19, 2013.
"Development Plans" means those plans and drawings to be submitted to City for its
approval, pursuant to Section 302.1 hereof.
"Environmental Consultant" means the environmental consultant which may be
employed by the Developer pursuant to Section 206.2 hereof.
"Exceptions" means the exceptions to Title, as set forth in Section 202.1 hereof.
"Extremely Low Income Household" means an annual gross income that does not
exceed the qualifying limits, adjusted for household size and other factors, for a "extremely low-
income family" as defined under the United States Housing Act of 1937 as amended, and as
determined from time to time by HUD for the Los Angeles Metropolitan Statistical Area. If
HUD should cease making such determination, "extremely low income" shall be defined as equal
to or less than 30% of Area Median Income, or City in its reasonable discretion may designate
another definition of "extremely low income" used by any other federal or state agency.
"Governmental Requirements" means all laws, ordinances, statutes, codes, rules,
regulations, orders, and decrees of the United States, the state, the County, the City, or any other
political subdivision in which the Site is located, and of any other political subdivision, agency,
or instrumentality exercising jurisdiction over the Developer or the Site.
"Ground Lease" means the ground lease of the Site from the City to the Developer
substantially in the form of Attachment No. 3, as described in Section 201 hereof.
"Hazardous Materials" means any substance, material, or waste which is or becomes
regulated by any local governmental authority, the County, the State of California, regional
governmental authority, or the United States Government, including, but not limited to, any
material or substance which is (i) defined as a "hazardous waste," "extremely hazardous waste,"
or "restricted hazardous waste" under Section 25115, 25117 or 25122.7, or listed pursuant to
Section 25140 of the California Health and Safety Code, Division 20, Chapter 6.5 (Hazardous
Waste Control Law)), (ii) defined as a "hazardous substance" under Section 25316 of the
California Health and Safety Code, Division 20, Chapter 6.8 (Carpenter -Presley -Tanner
Hazardous Substance Account Act), (iii) defined as a "hazardous material," "hazardous
substance," or "hazardous waste" under Section 25501 of the California Health and Safety Code,
Division 20, Chapter 6.95 (Hazardous Materials Release Response Plans and Inventory), (iv)
defined as a "hazardous substance" under Section 25281 of the California Health and Safety
Code, Division 20, Chapter 6.7 (Underground Storage of Hazardous Substances), (v) petroleum,
(vi) friable asbestos, (vii) polychlorinated biphenyl's, (viii) methyl tertiary butyl ether, (ix) listed
under Article 9 or defined as "hazardous" or "extremely hazardous" pursuant to Article 11 of
Title 22 of the California Code of Regulations, Division 4, Chapter 20, (x) designated as
"hazardous substances" pursuant to Section 311 of the Clean Water Act (33 U.S.C. § 1317), (xi)
1017942.5
defined as a "hazardous waste" pursuant to Section 1004 of the Resource Conservation and
Recovery Act, 42 U.S.C. §6901 et seq. (42 U.S.C. §6903), or (xii) defined as "hazardous
substances" pursuant to Section 101 of the Comprehensive Environmental Response,
Compensation, and Liability Act, 42 U.S.C. §6901 et seq. Notwithstanding the foregoing,
"Hazardous Materials" shall not include such products in quantities as are customarily used in
the construction, maintenance, rehabilitation or management of residential developments or
associated buildings and grounds, or typically used in residential activities in a manner typical of
other comparable residential developments, or substances commonly ingested by a significant
population living within the Housing Development, including without limitation alcohol, aspirin,
tobacco and saccharine.
"Housing Development" means the new multifamily housing complex and associated
improvements to be constructed by the Developer upon the Site, all more particularly described
in Section 301 hereof and in the Scope of Development.
"Housing Units" means the rental housing units within the Housing Development to be
constructed and operated by the Developer on the Site, as provided in Section 301 hereof and in
the Scope of Development.
"HUD" means the United States Department of Housing and Urban Development.
"Investor Limited Partner" means each limited partner in the Developer's limited
partnership, as provided in the Partnership Agreement.
"Lender" means each of the responsible financial lending institutions approved by the
City, which provide funds for the development or operation of the Housing Development, as set
forth in Section 401 hereof.
"Lower Income Household" means an annual gross income that does not exceed the
qualifying limits, adjusted for household size and other factors, for a "low-income family" as
defined under the United States Housing Act of 1937 as amended, and as determined from time
to time by HUD for the Los Angeles Metropolitan Statistical Area. If HUD should cease making
such determination, "low income" shall be defined as equal to or less than 60% of Area Median
Income, or City in its reasonable discretion may designate another definition of "low income"
used by any other federal or state agency.
"Monthly Rent" shall mean the total of monthly payments for (a) use and occupancy of
each Housing Unit and land and facilities associated therewith, (b) any separately charged fees or
service charges assessed by the Developer which are required of all tenants, other than security
deposits, (c) a reasonable allowance for an adequate level of service of utilities not included in
(a) or (b) above, including garbage collection, sewer, water, electricity, gas and other heating,
cooking and refrigeration fuels, but not including telephone service, and (d) possessory interest,
taxes or other fees or charges assessed for use of the land and facilities associated therewith by a
public or private entity other than Developer. In the event that all utility charges are paid by the
landlord rather than the tenant, no utility allowance shall be deducted from the Rent.
"Notice" shall mean a notice in the form prescribed by Section 701 hereof.
"Outside Date" shall mean the last date the Commencement of the Ground Lease shall
4
1017942.5
occur, as set forth in Section 203.3 hereof
"Partnership Agreement" means the agreement which sets forth the terms of the
Developer's limited partnership, as such agreement may be amended from time to time.
"RAP" means the Remedial Action Plan for the Remediation of the Site as provided in
Section 206.3 hereof.
"Regulatory Agreement" shall mean the Regulatory Agreement which is to be recorded
against the Site in a form which is attached hereto as Attachment No. 9 and incorporated herein,
in accordance with Section 515 hereof.
"Remediation" means the remediation of Hazardous Materials on the Site in accordance
with a remedial action plan which is approved by one or more appropriate regulatory agencies
with jurisdiction over the environmental condition of the Site.
"Schedule of Performance" means that certain Schedule of Performance attached hereto
as Attachment No. 6 and incorporated by reference, which sets forth the time for performing the
various obligations of this Agreement.
"Scope of Development" means that certain Scope of Development attached hereto as
Attachment No. 5 and incorporated by reference, which describes the scope, amount, and quality
of the Housing Development to be constructed by the Developer pursuant to the terms and
conditions of this Agreement. The Scope of Development is subject to revision only as provided
herein.
"Site" means that approximately 2.06 acre parcel of real property which is owned by the
City, located at 4675 52"d Drive in the City, as more particularly described in the Site Legal
Description and depicted on the Site Map.
"Site Legal Description" means the description of the Site which is attached hereto as
Attachment No. 2 and incorporated herein.
"Site Map" means the map of the Site which is attached hereto as Attachment No. 1 and
incorporated herein.
"Studies" means the studies and investigations which are conducted pursuant to Section
205 hereof.
"Substantial Damage" is defined in Section 306.2 hereof.
"Tax Credit Regulatory Agreement" shall mean the regulatory agreement which may be
required to be recorded against the Site as a requirement in connection with the allocation of Tax
Credits to the Housing Development, as set forth in Section 512 hereof.
"Tax Credit Rules" means Section 42 of the Internal Revenue Code and the rules and
regulations implementing the foregoing.
"Tax Credits" shall mean Low Income Housing Tax Credits allocated pursuant to
1017942.5
Section 42 of the Internal Revenue Code and/or California Revenue and Taxation Code
Sections 17057.5, 17058, 23610.4 and 23610.5 and California Health and Safety Code
Sections 50199,etseq.
"Title Company" is defined in Section 202.1 hereof.
"Title Policy" means the Title Policy to be provided to the Developer, as set forth in
Section 202.2 hereof.
"Title Report" means the preliminary title report for the Site, as described in Section
202.1 hereof.
"Very Low Income Household" means an annual gross income that does not exceed the
qualifying limits, adjusted for household size and other factors, for a "very low-income family"
as defined under the United States Housing Act of 1937 as amended, and as determined from
time to time by HUD for the Los Angeles Metropolitan Statistical Area. If HUD should cease
making such determination, "very -low income" shall be defined as equal to or less than 50% of
Area Median Income, or City in its reasonable discretion may designate another definition of
"very -low income" used by any other federal or state agency.
200. LEASE OF SITE
201. Lease of Site. Subject to the satisfaction or waiver of the Conditions Precedent to
Lease Commencement as set forth below, City shall lease the Site to the Developer for a term of
sixty-five (65) years (the "Ground Lease"), at a rental amount of One Dollar ($1.00) per year.
The Developer shall have one option to extend the term of the Ground Lease for an additional
ten (10) years. This agreement to lease the Site to the Developer is intended to satisfy the
requirements of the Tax Credit Rules for the Developer to obtain exclusive possession of the Site
prior to submission of an application for Tax Credits. The terms and conditions of the Ground
Lease shall be set forth in a Ground Lease substantially in the fort attached hereto as
Attachment No. 3 and incorporated herein.
202. Title.
202.1 Review of Title. Within the time set forth in the Schedule of
Performance, City shall cause First American Title Company, or another title company
reasonably acceptable to both parties (the "Title Company"), to deliver to Developer a standard
preliminary title report (the "Title Report") with respect to title to the Site, dated within 30 days
of the date of this Agreement, together with legible copies of the documents underlying the
exceptions ("Exceptions") set forth in the Title Report. Developer shall have the right to
reasonably approve or disapprove the Exceptions. Developer shall have thirty (30) days from the
date of receipt of the Title Report pursuant to this Section 202 to give written notice to City of
Developer's approval or disapproval of any of such Exceptions. Developer's failure to give
written approval of the Title Report within such time limit shall be deemed disapproval of the
Title Report. If Developer notifies City of its disapproval of any Exceptions in the Title Report,
City shall have the right, but not the obligation, to remove any disapproved Exceptions within
sixty (60) days after receiving written notice of Developer's disapproval or provide assurances
satisfactory to Developer that such Exception(s) will be removed on or before the
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1017942.5
Commencement of the Ground Lease. If City cannot or in its sole discretion does not elect to
remove any of the disapproved Exceptions within that period, Developer shall have ten (10)
business days after the expiration of such sixty (60) business day period to either give City
written notice that Developer elects to proceed with the commencement of the Ground Lease
subject to the disapproved Exceptions or to give City written notice that the Developer elects to
terminate this Agreement. The title to the Site, with the Exceptions to title approved by
Developer as provided herein, shall hereinafter be referred to as the "Condition of Title."
Developer shall have the right to approve or disapprove any Exceptions reported by the Title
Company after Developer has approved the Condition of Title for the Site (which are not created
by Developer). City shall not voluntarily create any new exceptions to title following the date of
this Agreement.
202.2 Title Insurance. Concurrently with commencement of the Ground Lease,
there shall be issued to Developer a CLTA standard form lessee's policy of title insurance (or at
Developer's option, an ALTA extended coverage lessee's policy of title insurance) (the "Title
Policy") in the amount required by the Developer or its investor, which insures the Developer's
possessory interest in the Site, together with such endorsements as are reasonably requested by
the Developer, issued by the Title Company, insuring that the leasehold to the Site is vested in
Developer in the condition required by Section 202.1 of this Agreement. The Title Company
shall provide City with a copy of the Title Policy. City agrees to remove on or before the
commencement of the Ground Lease any deeds of trust or other monetary liens against the Site.
City shall pay the premium for the CLTA coverage for the Title Policy; Developer shall pay any
and all additional premiums necessary for ALTA coverage and any additional costs, including
the cost of any endorsements, requested by the Developer.
202.3 Creation of Parcel. City shall create a legal parcel consisting of the Site.
203. Conditions to Lease Commencement.
203.1 City's Conditions to Lease Commencement. City's obligation to
execute the Ground Lease and deliver possession of the Site to Developer is subject to the
fulfillment or waiver by City of each and all of the conditions precedent (a) through 0),
inclusive, described below ("City's Conditions Precedent"), which are solely for the benefit of
City, any of which may be waived by the City Administrator (or designee) in his or her sole and
absolute discretion.
(a) Tax Credits. Developer shall have obtained an allocation of 9%
Tax Credits for the Housing Development from TCAC in accordance with Section 403 hereof.
(b) Execution of Documents. Developer shall have executed and
delivered to the City the Ground Lease, the Memorandum of Ground Lease, the Regulatory
Agreement, and any other documents required hereunder for the commencement of the Ground
Lease, and the Memorandum of Ground Lease and Regulatory Agreement shall have been
recorded as encumbrances to the Developer's leasehold interest in the Site.
(c) Land Use Approvals and Permits. City shall have approved the
Development Plans and construction plans for the Housing Development, and Developer shall
have obtained each and all of the land use, subdivision, grading and building permits and
1017942.5
approvals necessary for the construction of the Housing Development, in accordance with
Section 303 hereof (provided that with respect to permits, this condition shall be deemed
satisfied if permits are ready for issuance upon the payment of required fees). The City shall
have created a legal parcel consisting of the Site.
(d) Construction Contract. Developer shall have provided to the
City a signed copy of the Construction Contract between the Developer and a duly licensed
general contractor for the construction of the Housing Development, in compliance with the
requirements of Section 305 hereof, and the City Administrator (or designee) shall have
reasonably approved such contractor and contract pursuant to Section 305.
(e) Security. The Developer's contractor shall have provided
payment bonds and performance and completion bonds, a letter of credit in an amount and form
which is reasonably acceptable to the City, or other forms of security reasonably acceptable to
the City, in accordance with Section 305 hereof.
(f) Proof of Insurance. Developer shall have provided proof of
insurance conforming to Section 306 of this Agreement.
(g) Financing. Developer shall have provided written proof
acceptable to City that the Developer has obtained a commitment of equity contributions,
affordable housing subsidies, and a commitment for construction financing and permanent
financing, subject to customary conditions, for the Housing Development, and City shall have
approved such evidence of financing and financing agreements in accordance with Section 401
hereof. The City shall have approved the Financing Plan pursuant to Section 401 hereof. All
sources of financing required by the above to close concurrently with the Commencement of
Ground Lease shall have closed or shall be ready to close concurrently with the Commencement
of Ground Lease.
(h) Partnership Agreement. A partnership agreement reasonably
acceptable to the City in accordance with Section 404 shall have been executed and a Certificate
of Limited Partnership shall have been filed with the California Secretary of State, under which
the limited partners are committed to make equity contributions in an amount which is consistent
with the Financing Plan.
(i) Environmental Condition. Developer shall have approved the
environmental condition of the Site and shall not have elected to terminate this Agreement
pursuant to Section 206.2 hereof.
(j) No Default, Representations and Warranties. Developer shall
not be in default in any of its obligations under the terms of this Agreement. All representations
and warranties of Developer contained herein shall be true and correct in all material respects on
and as of the Commencement Date as though made at that time and all covenants of Developer
which are required to be performed prior to the Commencement Date shall have been performed
by such date.
203.2 Developer's Conditions to Lease Commencement. Developer's
obligation to execute the Ground Lease and accept possession of the Site is subject to the
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1017942.5
fulfillment or waiver by Developer of each and all of the conditions precedent (a) through (h),
inclusive, described below ("Developer's Conditions to Lease Commencement"), which are
solely for the benefit of Developer, and which shall be fulfilled or waived by the time periods
provided for herein:
(a) Tax Credits. Developer shall have obtained an allocation of 9%
Tax Credits for the Housing Development from TCAC in accordance with Section 403 hereof.
(b) Execution of Documents. City shall have executed the Ground
Lease, Memorandum of Ground Lease, Regulatory Agreement and any other documents required
hereunder with respect to the Ground Lease.
(c) Land Use Approvals and Permits. City shall have approved the
Development Plans and construction plans for the Housing Development, and Developer shall
have obtained each and all of the land use, subdivision, grading and building permits and
approvals necessary for the construction of the Housing Development, in accordance with
Section 303 hereof (provided that with respect to permits, this condition shall be deemed
satisfied if permits are ready for issuance upon the payment of requited fees). The City shall
have created a legal parcel consisting of the Site.
(d) Financing. All sources of financing required to close concurrently
with the Commencement of Ground Lease shall have closed or shall be ready to close
concurrently with the Commencement of Ground Lease.
(e) Review and Approval of Title. Developer shall have reviewed
and approved the condition of title of the Site, as provided in Section 202.1 hereof.
(f) Title Policy. The Title Company shall have agreed to issue the
Title Policy to Developer, in accordance with Section 202.2 hereof.
(g) Approval of Studies. Developer shall have approved the Studies
with respect to the Site pursuant to Section 205 hereof.
(h) Environmental Condition. Developer shall have approved the
environmental condition of the Site pursuant to Section 206 hereof.
(i) No Default; Representations and Warranties. City shall not be
in default in any of its obligations under the terms of this Agreement. All representations and
warranties of City contained herein shall be true and correct in all material respects on and as of
the Commencement Date as though made at that time and all covenants of City which are
required to be performed prior to the Commencement Date shall have been performed by such
date.
203.3 Commencement of Lease. The commencement of the Ground Lease
shall take place within thirty (30) days of the parties' satisfaction of all of City's Conditions
Precedent and Developer's Conditions Precedent as set forth in Sections 203.1 and 203.2 hereof,
respectively, but in no event later than 180 days (or such longer time as may be permitted by the
TCAC Readiness Requirements applicable at the time) after the award date of the second
consecutive competitive TCAC Tax Credits application round occurring after the date of this
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Agreement (which is currently anticipated to be March 24, 2014) (the "Outside Date"); provided,
however, that the parties may mutually agree to extend such date by a writing signed by both
parties. The parties agree to use their best efforts to provide for the commencement of the
Ground Lease prior to the Outside Date.
204. Representations and Warranties.
204.1 City Representations. City represents and warrants to Developer as
follows
(a) Authority. City is a charter city and municipal corporation, with
full right, power and lawful authority to lease the Site as provided herein. The execution,
performance, and delivery of this Agreement by City has been fully authorized by all requisite
actions on the part of City. The parties who have executed this Agreement on behalf of City are
authorized to bind City by their signatures hereto.
(b) Leases. To the best of City's knowledge, no person, corporation,
partnership or other entity has the right to possess the Site.
(c) No Conflict. To the best of City's knowledge, City's execution,
delivery, and performance of its obligations under this Agreement will not constitute a default or
a breach under any contract, agreement or order to which City is a party or by which it is bound.
(d) Governmental Compliance. To the best of City's knowledge, the
Site is not currently in violation of any law, ordinance, rule, regulation or requirement applicable
to its use and operation. If any such notice or notices of violation are received by the City or
City following the date this Agreement is signed by Developer, City shall, within ten (10) days
of receipt of such notice notify Developer; City then, at its option, may either elect to perform
the work or take the necessary corrective action prior to the Commencement of the Ground
Lease or refuse to do so, in which case City shall notify Developer of such refusal and Developer
shall be entitled to either accept possession to the Site with knowledge of such notice(s) or
terminate this Agreement in accordance with Section 603 hereof, and subject to the Developer's
right to obtain payment for the Plans pursuant to Section 611 hereof.
(e) No City Bankruptcy. City is not the subject of a bankruptcy
proceeding.
(f) Pending Claims. To the best of City's knowledge, there are no
actions, suits, claims, legal proceedings, or any other proceedings affecting the Site or any
portion thereof, at law, or in equity before any court or governmental agency.
Until the Commencement of the Ground Lease, City shall, upon learning of any fact or
condition which would cause any of the warranties and representations in this Section 204.1 not
to be true as of Commencement of the Ground Lease, immediately give written notice of such
fact or condition to Developer. Such exception(s) to a representation shall not be deemed a
breach by City hereunder, but shall constitute an exception which Developer shall have a right to
reasonably approve or disapprove. If Developer elects to accept possession to the Site following
disclosure of such information, City's representations and warranties contained herein shall be
deemed to have been made as of the Commencement of the Ground Lease, subject to such
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exception(s). If, following the disclosure of such information, Developer may elect to terminate
this Agreement in accordance with Section 603 hereof. The representations and warranties set
forth in this Section 204.1 shall remain in effect during the term of the Ground Lease.
204.2 Developer's Representations. Developer represents and warrants to City
as follows:
(a) Authority. Developer is a duly organized corporation organized
within and in good standing under the laws of the State of California. Developer has full right,
power and lawful authority to lease and accept possession to the Site and undertake all
obligations as provided herein and the execution, performance and delivery of this Agreement by
Developer has been fully authorized by all requisite actions on the part of the Developer. The
parties who have executed this Agreement on behalf of Developer are authorized to bind
Developer by their signatures hereto.
(b) Litigation. To the best of Developer's knowledge, there are no
actions, suits, material claims, legal proceedings, or any other proceedings affecting the
Developer or any parties affiliated with Developer, at law or in equity before any court or
governmental agency, domestic or foreign, which if adversely determined, would materially
impair the right of Developer to execute or perform its obligations under this Agreement or any
documents required hereby to be executed by Developer, or which would materially adversely
affect the financial condition of Developer or any parties affiliated with Developer.
(c) No Conflict. To the best of Developer's knowledge, Developer's
execution, delivery, and performance of its obligations under this Agreement will not constitute a
default or a breach under any contract, agreement or order to which Developer or any parties
affiliated with Developer is a party or by which it is bound.
(d) No Developer Bankruptcy. No attachments, execution
proceedings, assignments for the benefit of creditors, insolvency, bankruptcy, reorganization,
receivership or other proceedings are pending or threatened against the Developer or any parties
affiliated with Developer, nor are any of such proceedings contemplated by Developer or any
parties affiliated with Developer.
Until the Commencement of the Ground Lease, Developer shall, upon learning of any
fact or condition which would cause any of the warranties and representations in this Section
204.2 not to be true as of Commencement of the Ground Lease, immediately give written notice
of such fact or condition to City. Such exception(s) to a representation shall not be deemed a
breach by Developer hereunder, but shall constitute an exception which City shall have a right to
reasonably approve or disapprove. If City elects to commence the Ground Lease following
disclosure of such information, Developer's representations and warranties contained herein
shall be deemed to have been made as of the Commencement of the Ground Lease, subject to
such exception(s). If, following the disclosure of such information, City elects to not close
Escrow, City may elect to terminate this Agreement in accordance with Section 604 hereof, and
neither party shall have any further rights, obligations or liabilities hereunder. The
representations and warranties set forth in this Section 204.2 shall remain in effect during the
term of the Ground Lease.
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205. Studies and Reports. Developer shall have until sixty (60) days after receipt of a
9% Tax Credit allocation to conduct any and all studies, and to approve or disapprove, in
Developer's reasonable discretion, the results of such studies, concerning the development of the
Site along with any engineering tests, soils, seismic and geologic, reports with respect to the Site
as Developer may elect to make or obtain (the "Studies"). In connection with Developer's
review of the Studies described in this Section 205, City shall deliver to Developer within thirty
(30) days of the date of this Agreement, and Developer shall have the right to review, any of the
following documents relating to the Site which City has in its possession or is under its control:
(a) Any soils, geological and engineering studies which City has
concerning the Site; and
(b) Copies of any licenses or permits relating to the development or
use of the Site.
Prior to the Commencement of the Ground Lease, representatives of Developer
shall have the right of access to all portions of the Site at all reasonable times for the purpose of
obtaining data and making surveys and tests necessary to carry out this Agreement, including the
investigation of the environmental condition of the Site pursuant to Section 206 hereof. Any
preliminary work undertaken on the Site by Developer prior to the Commencement of the
Ground Lease shall be done at the sole expense of the Developer and only after Developer's
execution of a Right of Entry Agreement, in a form to be provided by the City and its legal
counsel, which protects City and the City against such entry. The Right of Entry Agreement
shall provide that the Developer shall save and protect City and its officers, employees, agents,
and representatives against any claims resulting from all preliminary work, access or use
undertaken pursuant to this Section 205, except for claims resulting from the negligence or
intentional misconduct of City or its officers, employees, agents or representatives. Any
preliminary work shall be undertaken only after securing any necessary permits from the
appropriate governmental agencies.
206. Condition of the Site.
206.1 Disclosure. The City has delivered to the Developer the materials relating
to the environmental condition of the Site which are set forth in Attachment No. 4 hereto. City
hereby represents to the best of its knowledge that, other than the foregoing, it is not aware of
and has not received any notice or communication from any government agency, having
jurisdiction over the Site notifying City of the presence of surface or subsurface zone Hazardous
Materials in, on, or under the Site, or any portion thereof. `Best knowledge," as used herein,
shall not impose a duty of investigation, and shall be limited to the best knowledge of City
employees and agents who manage the Site or have participated in the preparation of this
Agreement, and all documents and materials in the possession of City.
206.2 Investigation of Site. The Developer shall have the right, upon
satisfaction of the requirements of Section 205 hereof, and at its sole cost and expense, to engage
its own environmental consultant to make such further investigations of the Site as Developer
deems necessary, including any "Phase I" and/or "Phase 2" investigations of the Site, and the
City shall promptly be provided a copy of all reports and test results provided by Developer's
environmental consultant. Each environmental report shall specifically provide that it is
prepared for the benefit of both the City and the Developer, and that both parties may rely on the
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results of such report. Developer shall reasonably approve or disapprove of the environmental
condition of the Site within sixty (60) days after receipt of a 9% Tax Credit allocation.
Developer's approval of the environmental condition of the Site shall be a Developer's
Condition Precedent, as set forth in Section 203.2 hereof.
206.3 Remediation of Site. As provided in the Scope of Development,
Developer is required hereunder, at its expense, to design and install a vapor barrier and a
venting system to reduce the vapor release from the Site to an acceptable level. Developer shall
further be responsible for performing, at its cost, any additional required Remediation of the Site
in accordance with Governmental Requirements. If Developer is required or otherwise elects to
perform the Remediation of the Site, Developer shall deliver to City a proposed remedial action
plan ("RAP"), which RAP shall be approved by the City Environmental Health Department. The
Remediation shall be continuously and diligently performed in accordance with the approved
RAP and all Governmental Requirements.
206.4 No Further Warranties As To Site. Except as otherwise provided
herein, the physical condition and possession of the Site is and shall be delivered from City to
Developer in an "as -is" condition, with no warranty expressed or implied by City, including
without limitation, the presence of Hazardous Materials or the condition of the soil, its geology,
the presence of known or unknown seismic faults, or the suitability of the Site for the
development purposes intended hereunder. Notwithstanding the foregoing, however, nothing in
this Section 206 shall modify the City's responsibility or liability under applicable Governmental
Requirements for any Hazardous Materials which may have been released upon or under the Site
prior to the commencement of the Ground Lease. Developer shall not be responsible or liable
for any Hazardous Materials which may have been released upon or under the Site prior to the
commencement of the Ground Lease.
206.5 Developer Precautions After Commencement of Ground Lease. Upon
and after the Commencement of the Ground Lease, Developer shall take all necessary
precautions to prevent the release into the environment of any Hazardous Materials which are
located in, on or under the Site. Such precautions shall include compliance with all
Governmental Requirements with respect to Hazardous Materials. In addition, Developer shall
install and utilize such equipment and implement and adhere to such procedures as are consistent
with commercially reasonable standards as respects the disclosure, storage, use, removal and
disposal of Hazardous Materials.
206.6 Developer Disclosures After Commencement of Ground Lease. After
the Commencement of the Ground Lease, the Developer shall notify City, and provide to City a
copy or copies, of all environmental permits, disclosures, applications, entitlements, or inquiries
relating to the Site, including notices of violation, notices to comply, citations, inquiries,
clean-up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting
requirements and reports filed or applications made pursuant to any Governmental Requirement
relating to Hazardous Materials. Developer shall report to City, as soon as possible after each
incident, any unusual or potentially important incidents with respect to the environmental
condition of the Site. In the event of a release of any Hazardous Materials into the environment,
Developer shall, as soon as possible after the release, furnish to City a copy of any and all reports
relating thereto and copies of all correspondence with governmental agencies relating to the
release. Upon request, the Developer shall furnish to City a copy or copies of any and all other
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environmental entitlements or inquiries relating to or affecting the Site including, but not limited
to, all permit applications, permits and reports including, without limitation, those reports and
other matters which may be characterized as confidential.
206.7 Developer Indemnity. Upon and after the Commencement of the Ground
Lease, Developer agrees to indemnify, defend and hold City harmless from and against any
claim, action, suit, proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive
damage, or expense (including, without limitation, reasonable attorneys' fees), resulting from,
arising out of, or based upon (i) the release, use, generation, discharge, storage or disposal of any
Hazardous Materials on, under, in or about, or the transportation of any such Hazardous
Materials to or from, the Site which occurs during the term of the Ground Lease, or (ii) the
violation, or alleged violation, of any statute, ordinance, order, rule, regulation, permit, judgment
or license relating to the use, generation, release, discharge, storage, disposal or transportation of
Hazardous Materials on, under, in or about, to or from, the Site which occurs during the term of
the Ground Lease, or (iii) Developer's design, installation, operation and/or maintenance of the
vapor barriers and venting system on the Site, or (iv) Developer's performance of any
Remediation work on the Site, excepting only any such loss, liability, claim, or judgment arising
out of the intentional wrongdoing or gross negligence of City, or its officers, officials,
employees, members, agents, volunteers, or representatives. This indemnity shall include,
without limitation, any damage, liability, fine, penalty, cost or expense arising from or out of any
claim, action, suit or proceeding, including injunctive, mandamus, equity or action at law, for
personal injury (including sickness, disease or death), tangible or intangible property damage,
compensation for lost wages, business income, profits or other economic loss, damage to the
natural resource or the environment, nuisance, contamination, leak, spill, release or other adverse
effect on the environment. Notwithstanding Developer's assignment or transfer of its rights and
obligations under this Agreement pursuant to Section 703 hereof, Developer's obligations under
this Section 206.7 shall remain in effect with respect to liabilities arising as a result of conditions
prior to such assignment or transfer.
300. DEVELOPMENT OF THE SITE
301. Scope of Development. Developer shall develop the Housing Development in
accordance with the Scope of Development which is attached hereto as Attachment No. 5 and
incorporated herein, the Development Agreement, and the approved plans, drawings and
documents for the Housing Development. The Housing Development shall include
approximately 9 one bedroom apartment units, 22 two bedroom apartment units, and 14 three
bedroom apartment units, a community building, an office for Site managers and social service
providers, laundry room, computer lab, tot lot, not less than 74 onsite parking spaces, driveways,
curbs, gutters, sidewalks, fire hydrants, street trees, street lights and associated landscaping. The
Housing Development shall be gated. Three of the apartment units (one one -bedroom unit, one
two -bedroom unit and one three -bedroom unit) shall be accessible in accordance with ADA
standards, and all of the ground floor level apartment units shall be adaptable to ADA
accessibility standards. The Housing Development shall obtain LEED Silver certification.
Developer shall be responsible for importing new clean fill dirt, installation of a vapor barrier
below each structure, and installation of a venting system. The cost of planning, designing,
developing, and constructing the Housing Development shall be borne solely by the Developer.
The development of the Housing Development shall include compliance with the Mitigation
Monitoring Reporting Plan adopted by the City Council in accordance with the Mitigated
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Negative Declaration approved by the City Council for the Housing Development. In the event
of any inconsistency between the Scope of Development and the plans for the Housing
Development which have been approved by the City and/or City, the approved Development
plans shall control
302. Design Review.
302.1 Developer Submissions. Before commencement of construction of the
Housing Development or other works of improvement upon the Site, and as a City Condition
Precedent and Developer Condition Precedent to the Commencement of the Ground Lease
pursuant to Section 203, and at or prior to the times set forth herein, the Developer shall submit
to the City any plans and drawings (collectively, the "Development Plans") which may be
required by the City with respect to any permits and entitlements which are required to be
obtained to develop the Housing Development. Developer, on or prior to the date set forth in the
Schedule of Performance, shall submit to the City such plans for the Housing Development as
are required by the City in order for Developer to obtain building permits for the Housing
Development. Within thirty (30) days after the City's disapproval or conditional approval of
such plans, Developer shall revise the portions of such plans identified by the City as requiring
revisions and resubmit the revised plans to the City.
302.2 City Review and Approval. The City shall have all rights to review and
approve or disapprove all Development Plans and other required submittals in accordance with
the City Municipal Code and the Development Agreement, and nothing set forth in this
Agreement shall be construed as the City's approval of any or all of the Development Plans.
302.3 Revisions. Any and all change orders or revisions required by the City
and its inspectors which are required under the Municipal Code and all other applicable Uniform
Codes (e.g. Building, Plumbing, Fire, Electrical, etc.) and under other applicable laws and
regulations shall be included by the Developer in its Development Plans and other required
submittals and shall be completed during the construction of the Housing Development.
302.4 Defects in Plans. The City shall not be responsible either to the
Developer or to third parties in any way for any defects in the Development Plans, nor for any
structural or other defects in any work done according to the approved Development Plans, nor
for any delays reasonably caused by the review and approval processes established by this
Section 302.
303. Land Use Approvals. Before commencement of construction of the Housing
Development or other works of improvement upon the Site, and as a City Condition Precedent
and Developer Condition Precedent to the Commencement of the Ground Lease pursuant to
Section 203, Developer shall, at its own expense, secure or cause to be secured any and all land
use and other entitlements, permits, and approvals which may be required for the Housing
Development by the City or any other governmental agency affected by or having jurisdiction
over such construction or work. Developer shall, without limitation, apply for and secure, and
pay all costs, charges and fees associated therewith, all permits and fees required by the City,
County of Los Angeles, and other governmental agencies with jurisdiction over the Housing
Development. City staff shall work cooperatively with the Developer to assist in coordinating
the expeditious processing and consideration of all necessary permits, entitlements, and
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approvals. However, the execution of this Agreement does not constitute the granting of or a
commitment to obtain, approve, or grant any required land use permits, entitlements, or
approvals required by City.
304. Time of Performance; Progress Reports. Developer shall submit all
Development Plans, commence and complete all construction of the Housing Development, and
satisfy all other obligations and conditions of this Agreement within the times established
therefor in the Schedule of Performance which is attached hereto as Attachment No. 5 and
incorporated herein, and the text of this Agreement, subject to enforced delay pursuant to Section
702 hereof. Construction of the Housing Development shall be commenced within thirty (30)
days after the Commencement of the Ground Lease. Once construction is commenced, it shall
continuously and diligently be pursued to completion and shall not be abandoned for more than
fifteen (15) days. During the course of construction and prior to issuance of the Release of
Construction Covenants, Developer shall provide timely reports of the progress of construction
when requested by the City Administrator (or designee). Developer shall complete construction
of all of the Housing Development on the Site within the time set forth in the Schedule of
Performance.
305. Construction Contract. Developer shall enter into a contract with one or more
general contractors for the construction of the Housing Development, which contractor is duly
licensed in the State and is reasonably acceptable to the City Administrator (or designee) as
having experience and quality reasonably acceptable to City. The construction contract(s) shall
be reasonably acceptable to the City. The construction contract shall contain a schedule of
required warranties, with durations reasonably acceptable to the City, which require the
contractor to warranty the quality of construction of the Housing Development for the specified
durations. The contractor shall be required to obtain payment bonds and performance and
completion bonds, a letter of credit in an amount and form which is reasonably acceptable to the
City, or other forms of security reasonably acceptable to the City, which is sufficient to ensure
that the Housing Development is constructed in the manner provided in this Agreement.
306. Insurance Requirements. Prior to the commencement of the Ground Lease, the
Developer shall take out and maintain a Comprehensive General Liability policy in the amount
not less than Two Million Dollars ($2,000,000) combined single per occurrence for bodily injury
and property damage, including blanket Contractual Liability, Products and Completed
Operations, and maintain excess liability policy(ies) of not less than [Ten Million Dollars
($10,000,000)). In addition, upon commencement of the Ground Lease, Developer shall take out
and maintain, or shall cause its general contractor to take out and maintain, until the issuance of
the Certificate of Occupancy by the City, a Builder's Risk insurance policy in an amount not less
than the amount of the construction contract, and a Comprehensive Automobile Liability policy
in the amount of One Million Dollars ($1,000,000), combined single limit for bodily injury and
property damage. Coverage shall include "Owned, Non -Owned and Hired" automobiles, which
shall protect Developer and City from claims for such damages. Developer shall also furnish or
cause to be furnished to City evidence satisfactory to the City that Developer (if applicable) and
any contractor with whom it has contracted for the performance of work on the Site or otherwise
pursuant to this Agreement carries worker's compensation insurance as required by law and
Employers' Liability coverage with limits of not less than $1,000,000 for bodily injury and
disease. '
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Such policy or policies shall be written on an occurrence form and shall apply
separately to each insured against whom claim is made or suit is brought, except with respect to
the limits of the insured's liability. Developer shall also furnish or cause to be furnished to City
evidence satisfactory to the City that Developer (if applicable) and any contractor with whom it
has contracted for the performance of work on the Site or otherwise pursuant to this Agreement
carries workers' compensation insurance as required by law. Developer shall famish a
certificate of insurance countersigned by an authorized agent of the insurance carrier on a form
reasonably acceptable to City setting forth the general provisions of the insurance coverage. The
General Liability and Automobile Liability policies certificate shall name the City and its
officers, employees, agents, and representatives as additionally insured parties under the policy,
and the certificate shall be accompanied by a duly executed endorsement evidencing such
additional insured status. The certificate and endorsement by the insurance carrier shall contain
a statement of obligation on the part of the carrier to notify City of any material change,
cancellation or termination of the coverage at least thirty (30) days in advance of the effective
date of any such material change, cancellation or termination. Coverage provided hereunder by
Developer shall be primary insurance and not be contributing with any insurance maintained by
City, and the policy shall contain such an endorsement. The insurance policy or the endorsement
shall contain a waiver of subrogation for the benefit of the City. None of the above -described
policies shall require Developer or its general contractor to meet a deductible or self -insured
retention amount of more than Five Thousand Dollars ($5,000) unless approved in writing by the
City Administrator (or designee). All policies shall be written by good and solvent insurers
qualified to do business in California and reasonably acceptable to the City Administrator (or
designee). The required certificate shall be famished by Developer at the time set forth herein.
306.1 Obligation to Repair and Restore Damage Due to Casualty Covered
by Insurance. Subject to Section 306.2 below, if during the period of construction, the Housing
Development shall be totally or partially destroyed or rendered wholly or partly uninhabitable by
fire or other casualty required to be insured against by Developer, Developer shall promptly
proceed to obtain insurance proceeds and take all steps necessary to begin reconstruction and,
immediately upon receipt of insurance proceeds, to promptly and diligently commence the repair
or replacement of the Housing Development to substantially the same condition as the Housing
Development are required to be constructed pursuant to this Agreement, whether or not the
insurance proceeds are sufficient to cover the actual cost of repair, replacement, or restoration,
and Developer shall complete the same as soon as possible thereafter so that the Housing
Development can be occupied in accordance with this Agreement. Subject to Section 702, in no
event shall the repair, replacement, or restoration period exceed one (1) year from the date
Developer obtains insurance proceeds unless the City Administrator (or designee), in his or her
sole and absolute discretion, approves a longer period of time. City shall cooperate with
Developer, at no expense to City, in obtaining any governmental permits required for the repair,
replacement, or restoration. If, however, the then -existing laws of any other governmental
agencies with jurisdiction over the Site do not permit the repair, replacement, or restoration,
Developer may elect not to repair, replace, or restore the Housing Development by giving notice
to City (in which event Developer will be entitled to all insurance proceeds but Developer shall
be required to remove all debris from the applicable portion of the Site) or Developer may
reconstruct such other improvements on the Site as are consistent with applicable land use
regulations and approved by the City and the other governmental agency or agencies with
jurisdiction.
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306.2 Damage or Destruction Due to Cause Not Required to be Covered by
Insurance. If during the period of construction the Housing Development is completely
destroyed or substantially damaged by a casualty for which Developer is not required to (and has
not) insured against, then Developer shall not be required to repair, replace, or restore such
improvements and may elect not to do so by providing City with written notice of election not to
repair, replace, or restore within ninety (90) days after such substantial damage or destruction. In
such event, Developer shall remove all debris from the applicable portion of the Site. As used in
this Section 306.2, "substantial damage" caused by a casualty not required to be (and not)
covered by insurance shall mean damage or destruction which is fifteen percent (15%) or more
of the replacement cost of the improvements comprising the Housing Development. In the event
Developer does not timely elect not to repair, replace, or restore the Housing Development as set
forth in the first sentence of this Section 306.2, Developer shall be conclusively deemed to have
waived its right not to repair, replace, or restore the Housing Development and thereafter
Developer shall promptly commence and complete the repair, replacement, or restoration of the
damaged or destroyed Housing Development in accordance with Section 306.1 above.
307. Indemnity. Developer shall defend, indemnify, assume all responsibility for, and
hold City and its officers, employees, contractors, agents, and representatives harmless from, all
claims, demands, damages, defense costs or liability of any kind or nature (including reasonable
attorneys' fees and costs) and for any damages to property or injuries to persons, including
accidental death, in connection with or arising from Developer's performance or nonperformance
of its obligations under this Agreement, Developer's ownership or operation of the Housing
Development, or the development of the Housing Development, or challenges to the approval,
validity, applicability, interpretation or implementation of this Agreement or the California
Environmental Quality Act approvals made in connection therewith, whether such activities or
performance thereof be by the Developer or by anyone employed by or contracted with the
Developer and whether such damage shall accrue or be discovered before or after termination of
this Agreement. Developer shall not be liable for property damage or bodily injury occasioned
by the negligence of, willful misconduct of, or breach of this Agreement by City or its officers,
employees, contractors, agents, or representatives.
City shall defend, indemnify, assume all responsibility for, and hold Developer and its.
officers, employees, contractors, agents, and representatives harmless from, all claims, demands,
damages, defense costs or liability of any kind or nature (including attorneys' fees and costs) and
for any damages to property or injuries to persons, including accidental death, which may be
caused by or arise out of the City's performance or failure to perform its obligations pursuant to
this Agreement, whether such activities or performance thereof be by the City or by anyone
employed or contracted with by the City and whether such damage shall accrue or be discovered
before or after termination of this Agreement. City shall not be liable for property damage or
bodily injury occasioned by the negligence of, willful misconduct of, or breach of this
Agreement by Developer or its officers, employees, contractors, agents, or representatives.
308. Rights of Access. Prior to the issuance of the Release of Construction Covenants,
for purposes of assuring compliance with this Agreement, representatives of City shall have the
right of access to the Site, without charges or fees, at normal construction hours during the period
of construction for the purposes of this Agreement, including but not limited to, the inspection of
the work being performed in constructing the Housing Development so long as City
representatives comply with all safety rules. City representatives shall, except in emergency
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situations, notify the Developer in writing and at least 48 hours prior to exercising its rights
pursuant to this Section 308. Developer acknowledges that the City is under no obligation to
supervise, inspect, or inform Developer of the progress of construction, and Developer shall not
rely upon the City therefor. Any inspection by the City is entirely for its purposes in determining
whether Developer is in compliance with this Agreement and is not for the purpose of
determining or informing Developer of the quality or suitability of construction. Developer shall
rely entirely upon its own supervision and inspection in determining the quality and suitability of
the materials and work, and the performance of architects, subcontractors, and material suppliers.
309. Compliance with Laws. Developer shall carry out the design, construction and
operation of the Housing Development in conformity with all applicable laws, including the
Development Agreement, all applicable state labor standards, the City zoning and development
standards, building, plumbing, mechanical and electrical codes, and all other provisions of the
City Municipal Code, and all applicable disabled and handicapped access requirements,
including without limitation the Americans With Disabilities Act, 42 U.S.C. Section 12 10 1, et
seq., Government Code Section 4450, et seq., Government Code Section 11135, et seq., the
Unruh Civil Rights Act, Civil Code Section 51, et seq., and the California Building Standards
Code, Health and Safety Code Section 18900, et seq. The design, construction and operation of
the Housing Development shall be in compliance with any mitigation measures adopted in
accordance with the Mitigated Negative Declaration approved by the City Council for the
Housing Development.
309.1 Nondiscrimination in Employment. Developer certifies and agrees that
all persons employed or applying for employment by it, its affiliates, subsidiaries, or holding
companies are and will be treated equally by it without regard to, or because of race, color,
religion, ancestry, national origin, sex, sexual orientation, age, pregnancy, childbirth or related
medical condition, medical condition (cancer related) or physical or mental disability.
309.2 Taxes and Assessments. Developer shall pay prior to delinquency all ad
valorem real estate taxes and assessments on the Site, subject to the Developer's right to contest
in good faith any such taxes. The Developer may apply for and receive any exemption from the
payment of property taxes or assessments on any interest in or to the Site without the prior
approval of the City.
309.3 Liens and Stop Notices. Developer shall not allow to be placed on the
Site or the Housing Development or any part thereof any lien or stop notice. If a claim of a lien
or stop notice is given or recorded affecting the Housing Development the Developer shall
within thirty (30) days of such recording or service or within five (5) days of City's demand
whichever last occurs:
a. pay and discharge the same; or
b. affect the release thereof by recording and delivering to City a surety bond
in sufficient form and amount, or otherwise; or
C. provide City with indemnification from the Title Company against such
lien or other assurance which City deems, in its sole discretion, to be
satisfactory for the payment of such lien or bonded stop notice and for the
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full and continuous protection of City from the effect of such lien or
bonded stop notice.
310. Prevailing Wages. With respect to the construction of the Housing Development
set forth herein and in the Scope of Development, Developer and its contractors and
subcontractors shall pay prevailing wages and employ apprentices in compliance with Labor
Code Section 1770, et seq., and shall be responsible for the keeping of all records required
pursuant to Labor Code Section 1776, complying with the maximum hours requirements of
Labor Code Sections 1810 through 1815, and complying with all regulations and statutory
requirements pertaining thereto. Such requirements are set forth in greater detail in Attachment
No. 7 attached hereto, which is incorporated herein. The Developer shall certify to the City that
it is in compliance with the requirements of this Section 310.
Developer shall indemnify, protect, defend and hold harmless the City and its officers,
employees, contractors and agents, with counsel reasonably acceptable to the City, from and
against any and all loss, liability, damage, claim, cost, expense and/or "increased costs"
(including reasonable attorneys fees, court and litigation costs, and fees of expert witnesses)
which, in connection with the development, construction, and/or operation of the Housing
Development, including, without limitation, any and all public works (as defined by applicable
law), results or arises in any way from any of the following: (a) the noncompliance by
Developer of any applicable local, state and/or federal law, including, without limitation, any
applicable federal and/or state labor laws (including, without limitation, if applicable, the
requirement to pay state prevailing wages); (b) the implementation of Section 1781 of the Labor
Code, as the same may be amended from time to time, or any other similar law; and/or (c) failure
by Developer to provide any required disclosure or identification as required by Labor Code
Section 1781, as the same may be amended from time to time, or any other similar law. It is
agreed by the parties that, in connection with the construction of the Housing Development,
including, without limitation, any and all public works (as defined by applicable law), Developer
shall bear all risks of payment or non-payment of prevailing wages under California law and/or
the implementation of Labor Code Section 1781, as the same may be amended from time to time,
and/or any other similar law. "Increased costs," as used in this Section 310, shall have the
meaning ascribed to it in Labor Code Section 1781, as the same may be amended from time to
time. The foregoing indemnity shall survive termination of this Agreement and shall continue
after completion of the construction of the Housing Development by the Developer.
400. FINANCING OF THE HOUSING DEVELOPMENT.
401. Evidence of Financing; Financing Plan. As required herein and as a City
Condition Precedent to Commencement of the Ground Lease, the Developer shall submit to City
written evidence reasonably satisfactory to City that Developer has obtained sufficient equity
capital commitments and affordable housing subsidies, and has obtained approval for
construction financing from a reputable institutional lender necessary to undertake the
construction of the Housing Development in accordance with this Agreement, and a commitment
for permanent financing from a reputable institutional lender necessary to take out the
construction loan. The Developer shall further submit to the City for the approval by the City
Administrator (or designee) a "Financing Plan" which contains: (i) a development budget for the
Housing Development, (ii) a sources and uses analysis for the period of the construction,
including an analysis of subsidized public financing, (iii) a sources and uses analysis from the
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date of the origination of the permanent loan, if any, or in the absence of a permanent loan, from
the date of the issuance of the Certificate of Occupancy for the Housing Development, including
an analysis of any additional subsidized financing which is necessary, (iv) a 65 year cash flow
analysis of the Housing Development from the date of the issuance of the Certificate of
Occupancy for the Housing Development, (v) an operating budget for the Housing Development,
including without limitation an operating reserve fund and capital replacement reserve fund, (vi)
a projection of operating reserve and capital replacement reserve balances over a 65 year period,
and (vii) all underlying assumptions for each of the above. The Developer shall further submit to
the City copies of the proposed limited partnership agreement between the Developer and the
equity investors, any documents proposed to be entered by Developer with respect to the
affordable housing subsidies, and loan agreements and all other documents which Developer and
its proposed construction lender and permanent lender propose to execute in connection with
such financing. The City Administrator (or designee) shall approve or disapprove such evidence
of financing commitments and loan documents and the Financing Plan within fifteen (15)
business days of receipt of a complete submission. Approval shall not be unreasonably withheld
or conditioned. If City shall disapprove any such evidence of financing or loan documents or the
Financing Plan, City shall do so by written notice to the Developer stating the reasons for such
disapproval and the Developer shall promptly obtain and submit to City new evidence of
financing or revised loan documents, as appropriate. City shall approve or disapprove such new
evidence of financing and loan documents in the same manner and within the same times
established in this Section 401 for the approval or disapproval of the evidence of financing and
loan documents as initially submitted to City.
402. Application for Tax Credits and Other Affordable Housing Subsidized
Financing. It is the intent of the parties to maximize the leverage of City funds by making every
effort to secure sources of non -local subsidies for the Housing Development. Accordingly, the
Developer shall submit up to two applications to the California Tax Credit Allocation Committee
("TCAC") for competitive 9% Tax Credits in the first two allocation rounds which occur after
the date of this Agreement as may be necessary to secure an allocation of 9% Tax Credits for the
Housing Development. The first allocation round for which the Developer shall submit an
application shall be the first application round in 2013. In addition to Tax Credits, the Developer
shall also diligently pursue other potential sources of funding, which may include the Affordable
Housing Program of the Federal Home Loan Bank, the County of Los Angeles Community
Development Commission, and the State of California, if such financing is feasible.
403. Equity Financing Requirements. The following requirements must be satisfied
in order for such equity financing for Tax Credit funding to be approved by the City pursuant to
Section 401 (which requirements may be waived in the City's sole and absolute discretion):
(a) The equity investment of the limited partners of the limited
partnership shall not be less than the approximate prevailing price for Tax Credits at such time,
taking into consideration all relevant factors such as timing of required payments and amount of
credit.
(b) The identity of the limited partners of the limited partnership shall
be reasonably acceptable to the City.
(c) In connection with the formation of such limited partnership for
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the equity financing, Western Community Housing, Inc. or its affiliate (or another nonprofit
corporation highly experienced in the development and operation of affordable housing which is
reasonably acceptable to the City) shall be the managing general partner, and Meta Housing
Corporation or its affiliate shall be a general partner of the limited partnership at all times.
404. Additional Tax Credit Applications. In the event that the Developer submits
two applications to TCAC for competitive federal 9% Tax Credits in the first two allocation
rounds beginning in the first application round of 2013, but the Housing Development does not
receive an allocation of such Tax Credits in any of those two rounds, the parties shall meet and
confer to negotiate with one another regarding whether the Developer should submit further
applications for an allocation of 9% Tax Credits. In the event that the Developer and the City do
not approve further Tax Credit applications after the second round of Tax Credit allocations,
either party shall have the right in its sole and absolute discretion to terminate this Agreement as
provided in Sections 603 and 604 hereof.
405. No Encumbrances Except Mortgages and Deeds of Trust of Approved
Financing. Mortgages, deeds of trust, regulatory agreements, assignment agreements and other
recorded agreements are to be permitted during the construction of the Housing Development
and during the term of the Ground Lease only in connection with financing approved by the City
pursuant to Section 401 hereof.
406. Notice of Default to Mortgagee or Deed of Trust Holders; Right to Cure.
With respect to any mortgage or deed of trust granted by Developer as provided herein,
whenever City may deliver any notice or demand to Developer with respect to any breach or
default by the Developer hereunder or under any other document executed pursuant to this
Agreement, City may at the same time deliver to each holder of record of any mortgage or deed
of trust authorized by this Agreement a copy of such notice or demand. Each such holder shall
(insofar as the rights granted by City are concerned) have the right, at its option, within thirty
(30) days after the receipt of the notice, to cure or remedy or commence to cure or remedy and
thereafter to pursue with due diligence the cure or remedy of any such default and to add the cost
thereof to the mortgage debt and the lien of its mortgage. Nothing contained in this Agreement
shall be deemed to permit or authorize such holder to undertake or continue the construction or
completion of the Housing Development, or any portion thereof (beyond the extent necessary to
conserve or protect the improvements or construction already made) without first having
expressly assumed Developer's obligations to City by written agreement reasonably satisfactory
to City. The holder, in that event, must agree to complete, or cause to be completed by a party
which is reasonably acceptable to the City, in the manner provided in this Agreement, the
improvements to which the lien or title of such holder relates. It is understood that a holder (or
assignee approved by the City) shall be deemed to have satisfied the thirty (30) day time limit set
forth above for commencing to cure or remedy a Developer default which requires title and/or
possession of the Site (or portion thereof), if and to the extent any such holder (or assignee
approved by the City) has within such thirty (30) day period commenced proceedings to obtain
title and/or possession and thereafter the holder diligently pursues such proceedings to
completion and cures or remedies the default.
407. Failure of Holder to Complete Housing Development. In any case where,
ninety (90) days after the holder of any mortgage or deed of trust creating a lien or encumbrance
upon the Site or any part thereof receives a notice from City of a default by Developer in
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completion of construction of any of the Housing Development under this Agreement, and such
holder has not exercised the option to construct or cause to be constructed the Housing
Development as set forth in Section 406, or if it has exercised the option but has defaulted
hereunder and failed to timely cure such default, City may purchase the mortgage or deed of trust
by payment to the holder of the amount of the unpaid mortgage or deed of trust debt, including
principal and interest and all other sums secured by the mortgage or deed of trust. If the
possession of the Site or any part thereof has vested in the holder, City, if it so desires, shall be
entitled to a conveyance from the holder to City upon payment to the holder of an amount equal
to the sum of the following:
(a) The unpaid mortgage or deed of trust debt at the time title became
vested in the holder (less all appropriate credits, including those resulting from collection and
application of rentals and other income received during foreclosure proceedings);
(b) All expenses with respect to foreclosure including reasonable
attorneys' fees;
(c) The net expense, if any (exclusive of general overhead), incurred
by the holder as a direct result of the subsequent management of the Site or part thereof;
(d) The costs of any improvements made by such holder (or assignee
approved by the City) pursuant to the requirements of this Agreement or as otherwise approved
by the City;
(e) An amount equivalent to the interest that would have accrued on
the aggregate of such amounts had all such amounts become part of the mortgage or deed of trust
debt and such debt had continued in existence to the date of payment by City; and
(f) Any reasonable and customary prepayment charges imposed by the
lender pursuant to its loan documents and agreed to by the Developer.
408. Right of City to Cure Mortgage or Deed of Trust Default. In the event of
Developer's breach of a loan agreement, promissory note, mortgage or deed of trust, or a default
under the terms of Developer's Partnership Agreement, Developer shall immediately deliver to
City a copy of any default notice pertaining thereto. If the holder of any loan agreement,
promissory note, mortgage or deed of trust has not exercised its option to construct prior to the
completion of construction of the Housing Development, City shall have the right but not the
obligation to cure the default of such loan agreement, promissory note, mortgage, deed of trust or
Partnership Agreement. In such event, City shall be entitled to reimbursement from the
Developer of all proper costs and expenses incurred by City in curing such default. City shall
also be entitled to a lien upon the leasehold interest in the Site to the extent of such costs and
disbursements. Any such lien shall be junior and subordinate to the mortgages or deeds of trust
made pursuant to Section 401.
500. COVENANTS AND RESTRICTIONS
501. Use Covenants. Developer covenants and agrees for itself, its successors,
assigns, and every successor in interest to the Site or any part thereof, that upon the
Commencement of the Ground Lease and during construction and thereafter, the Developer shall
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devote the Site to the uses specified in this Agreement, the Regulatory Agreement, the Ground
Lease and the approved Development Plans, whichever is the more restrictive. All uses
conducted on the Site, including, without limitation, all activities undertaken by the Developer
pursuant to this Agreement, shall conform to all applicable provisions of the City Municipal
Code and requirements of the City's Housing Overlay Zone.
502. Number of Affordable Units. Developer agrees to make available, restrict
occupancy to, and rent two (2) of the Housing Units to Extremely Low Income Households,
fourteen (14) of the Housing Units to Very Low hncome Households, and six (6) of the Housing
Units to Lower Income Households (the "Affordable Units"), all at an Affordable Rent.
503. Duration of Affordability Requirements. The Affordable Units shall be subject
to the requirements of this Article 500 for the entire Term of the Ground Lease. The duration of
this requirement shall be known as the "Affordability Period."
504. Household Income Requirements. Developer shall obtain, or shall cause to be
obtained by the Property Manager, a certification from each household leasing an Affordable
Unit demonstrating that such household is an Extremely Low Income Household, Very Low
Income Household or Lower Income Household, as applicable, and meets the eligibility
requirements established for the Housing Unit. Developer shall verify, or shall cause to be
verified by the Property Manager, the income certification of the household.
505. Determination of Affordable Rent for the Housing Units. Each Affordable
Unit shall be rented at an "Affordable Rent" to be established as provided herein:
The maximum Monthly Rent chargeable for the Affordable Units shall be annually
determined in accordance with the following requirements. The Monthly Rent for the
Affordable Units to be rented to Extremely Low Income Households shall not exceed the
maximum rent allowable under the Tax Credit Rules for a tenant earning thirty percent (30%) of
the Los Angeles County area median income for a household size appropriate to the unit. The
Monthly Rent for the Affordable Units to be rented to Very Low Income Households shall not
exceed the maximum rent allowable under the Tax Credit Rules for a tenant earning fifty percent
(50%) of the Los Angeles County area median income for a household size appropriate to the
unit. The Monthly Rent for the Affordable Units to be rented to Lower Income Households shall
not exceed the maximum rent allowable under the Tax Credit Rules for a tenant earning sixty
percent (60%) of the Los Angeles County area median income for a household size appropriate
to the unit.
For purposes of this Agreement, "Monthly Rent" means the total of monthly payments for
(a) use and occupancy of each Affordable Unit and land and facilities associated therewith, (b)
any separately charged fees or service charges assessed by the Developer which are required of
all tenants, other than security deposits, (c) a reasonable allowance for an adequate level of
service of utilities not included in (a) or (b) above, including garbage collection, sewer, water,
electricity, gas and other heating, cooking and refrigeration fuels, but not including telephone
service, and (d) possessory interest, taxes or other fees or charges assessed for use of the land
and facilities associated therewith by a public or private entity other than Developer. In the
event that all utility charges are paid by the landlord rather than the tenant, no utility allowance
shall be deducted from the rent.
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506. Verifications. Developer shall verify, or shall cause its property manager to
verify, the income of each proposed and existing tenant of the Housing Units in an appropriate
manner on an annual basis. Representatives of the City shall be entitled to enter the Site, upon at
least forty-eight (48) hours notice, to inspect and copy such income determinations in accordance
with Section 513 of this Agreement.
507. Site Management Plan. The Developer has prepared a "Site Management Plan'
which sets forth in detail the Developer's property management duties, a marketing plan, a tenant
selection process, a security system and crime prevention program, the procedures for the
collection of rent, the procedures for eviction of tenants, the rules and regulations of the Housing
Development and manner of enforcement, a standard lease form, an operating budget, the
identity of the manager of the Housing Development (the "Property Manager"), the resident
services program to be provided pursuant to Section 509 hereof, and other matters relevant to the
management of the Housing Development. The Site Management Plan shall prohibit the
Property Manager from lobbying, influencing, or attempting to influence any residents of the
Housing Development or other registered voters of the City with respect to any matters which require
the approval of the City or the electorate of the City. The Site Management Plan is attached hereto
as Attachment No. 8 and incorporated herein. The Site Management Plan may be revised from
time to time with the approval of the City. The management of the Housing Development shall
be in compliance with the Site Management Plan which is approved by the City.
If the City determines that the performance of the Property Manager is deficient based
upon the standards set forth in the Site Management Plan and in this Agreement, the City shall
provide notice to the Developer of such deficiencies, and the Developer shall use its best efforts
to correct such deficiencies. In the event that such deficiencies have not been cured within the
time set forth in the Ground Lease, the City shall have.the right to require the Developer to
immediately remove and replace the Property Manager with another property manager or
property management company which is reasonably acceptable to the City, which is not related
to or affiliated with the Developer, and which has not less than five (5) years experience in
property management, including significant experience managing housing facilities of the size,
quality and scope of the Housing Development.
508. Selection of Tenants. Developer shall be responsible for the selection of tenants
for the Housing Units in compliance with lawful and reasonable criteria, as set forth in the Site
Management Plan, and according to a system which provides an agreed upon priority for persons
employed or residing in the City of Vernon or within a 1 mile radius as measured from the center
of the Site. The Site Management Plan shall include a system for the random selection of tenants
from a pool of applicants. Tenants shall meet criteria which is reasonable and customary for
similar multifamily developments. Tenant. selection shall be made in an open and public manner.
The tenant selection system in the Site Management Plan shall be designed to prevent favoritism
and outside influences of any kind in the selection process. The tenant selection system shall
provide for due diligence by Developer in evaluation of the applications for eligibility criteria,
including the basis of any requested priority. Representatives of the City shall be entitled to
enter, inspect the records of, and audit the Housing Development with respect to the tenant
selection process as provided in Section 513 hereof. Any violation of the tenant selection system
shall be deemed a material breach of this Agreement.
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509. Resident Services. At all times during the Affordability Period, Developer shall
provide, or cause to be provided, activities and programs appropriate to the needs of the residents
of the Housing Development, with the selection of such activities and programs to be determined
by Developer in collaboration with the residents of the Housing Development. The specific
types of social services to be provided shall be submitted to and approved by the City, and may
be revised with the prior approval of the City, which approval shall not be unreasonably
withheld. The annual cost of resident services shall be not less than $15,000, as adjusted
annually by the increase in the CPI during the previous 12 month period.
510. Maintenance of Site. The Developer shall maintain the Housing Development or
cause it to be maintained in a decent, safe and sanitary manner, and in accordance with the
standard of maintenance of first class apartment units within Los Angeles County, California. If
at any time Developer fails to maintain the Housing Development in accordance with this
Agreement and such condition is not corrected within five days after written notice from the City
with respect to graffiti, debris, and waste material, or thirty days after written notice from the
City with respect to general maintenance, landscaping and building improvements, then the City,
in addition to whatever remedy it may have at law or at equity, shall have the right to enter upon
the applicable portion of the Housing. Development and perform all acts and work necessary to
protect, maintain, and preserve the Housing Development, and to attach a lien upon the Housing
Development, or to assess the Housing Development, in the amount of the expenditures arising
from such acts and work of protection, maintenance, and preservation by the City and/or costs of
such cure, including a reasonable administrative charge, which amount shall be promptly paid by
Developer to the City upon demand.
511. Capital Reserve Requirements. The Developer shall annually set aside an
amount of Three Hundred Dollars ($300) per Housing Unit (or such larger amount as may be
required by a Housing Development lender), from the gross rents received from the Housing
Development, into a separate interest -bearing trust account in the name of the Developer (the
"Capital Replacement Reserve"); provided, however, to the extent the Developer is required by
any lender to maintain a separate account to hold deposits for capital reserves, the amount of
such deposits shall be credited towards Developer's obligations under this section. Such amount
shall be adjusted annually by the increase in the CPI during the previous 12 month period (or
such larger amount as may be required by a Housing Development lender). Funds in the Capital
Replacement Reserve shall be used for capital replacements to the Housing Development
fixtures and equipment which are normally capitalized under generally accepted accounting
principles. The non -availability of funds in the Capital Replacement Reserve does not in any
manner relieve the Developer of the obligation to undertake necessary capital repairs and
improvements and to continue to maintain the Housing Development in the manner prescribed
herein. Not less than once per year, Developer, at its expense, shall submit to the City an
accounting for the Capital Replacement Reserve. Capital repairs to and replacement of the
Housing Development shall include only those items with a long useful life, including without
limitation the following: carpet and drape replacement; appliance replacement; exterior painting,
including exterior trim; hot water heater replacement; plumbing fixtures replacement, including
tubs and showers, toilets, lavatories, sinks, faucets; air conditioning and heating replacement;
asphalt repair and replacement, and seal coating; roofing repair and replacement; landscape tree
replacement; irrigation pipe and controls replacement; gas line pipe replacement; lighting fixture
replacement; common area furniture replacement; common area repainting, and uninsured losses
due to casualties such as earthquakes.
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512. Relationship to Tax Credit Requirements. Notwithstanding any other
provisions of this Agreement, to the extent that the regulatory agreement executed by the
Developer as a requirement of receiving the Tax Credits (the "Tax Credit Regulatory
Agreement") is less restrictive with respect to the requirements applicable to tenant selection and
tenant income levels than as provided in this Agreement and the Regulatory Agreement, this
Agreement and the Regulatory Agreement shall control.
513. Monitoring and Recordkeeping. Throughout the Affordability Period, prior to
April 15 of each year, Developer shall annually complete and submit to City an audited financial
statement for the Housing Development and a report which includes (i) the name, address, income
and household size of each occupant of an Affordable Unit during the prior year, identifying the
bedroom count and Monthly Rent for such Affordable Unit, (ii) an identification of vacancies of
Affordable Units during the prior year, (iii) the amount deposited into reserve accounts in the
prior year, (iv) the amount and purposes of all expenditures of reserve accounts during the prior
year, (v) the current balance of reserve accounts, (vi) an operating budget for the current year,
(vii) a detailed accounting of operating expenditures in the prior year, and (viii) a description of
and cost of social service programs conducted in the prior year. City agrees that the Developer
may submit reporting forms prepared and submitted in connection with the Tax Credits, to the
extent those forms contain the information required hereunder. Representatives of the City -shall
be entitled to enter the Housing Development, upon at least forty-eight (48) hours prior written
notice, to monitor compliance with this Agreement, to inspect and make copies of the records of
the Housing Development, and to conduct an independent audit or inspection of such records.
The Developer agrees to cooperate with the City in making the Housing Development available
for such inspection or audit. Developer agrees to maintain records in businesslike manner, and
to maintain such records for the term of this Agreement.
514. Nondiscrimination Covenants. Developer covenants by and for itself and any
successors in interest that there shall be no discrimination against or segregation of any person or
group of persons on account of race, color, creed, religion, sex, marital status, national origin or
ancestry in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Site, nor
shall the Developer itself or any person claiming under or through it establish or permit any such
practice or practices of discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees of the Site or
any portion thereof. The foregoing covenants shall run with the land.
515. Naming Rights. City shall have the exclusive non-commercial right to select the
name of the Housing Development in its sole discretion to honor one or more civic or business
leaders, as the City Council may designate. Developer agrees to cooperate in the placement of a
suitable monument or other feature to memorialize this honor, at the City's expense. Developer
shall use the name selected by City on all exterior and interior project signage, written materials
and letterhead, leases and other project documents, and shall verbally refer to the Housing
Development by the selected name. The parties shall jointly agree in advance on the scheduling
of any official naming ceremonies, and the press announcements regarding such ceremonies, and
both parties shall have the right to participate in any such naming ceremonies.
516. Regulatory Agreement. As a City Condition Precedent to the Commencement
of the Ground Lease, the Developer shall execute, acknowledge, and deliver to City a
"Regulatory Agreement," substantially in the form of Attachment No. 9 hereto, to be recorded
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with respect to the Developer's leasehold interest in the Site in the official records of Los
Angeles County, California. The Regulatory Agreement shall contain those portions of this
Agreement relating to affordable housing requirements, and other provisions which are intended
to survive the completion of construction of the Housing Development.
517. Subordination of Affordability Covenants. In the event that the City finds that
an economically feasible method of financing for the construction and operation of the Housing
Development, without the subordination of the affordable housing covenants as may be set forth
in this Agreement, the Ground Lease and the Regulatory Agreement, is not reasonably available,
the City shall make the affordable housing covenants set forth in this Agreement, the Ground
Lease and the Regulatory Agreement junior and subordinate to the deeds of trust and other
documents required in connection with the construction and permanent financing for the Housing
Development approved pursuant to Section 401. Any subordination agreement entered into by
the City shall contain written commitments which the City finds are reasonably designed to
protect City's investment in the event of Default, such as either of the following: (a) a right of
City to cure a default on the loan prior to foreclosure, or (b) a right of City to negotiate with the
lender after notice of default from the lender and prior to foreclosure.
518. Effect of Violation of the Terms and Provisions of this Agreement After
Completion of Construction. City is deemed the beneficiary of the terms and provisions of this
Agreement and of the covenants running with the land, for and in its own right and for the
purposes of protecting the interests of the community and other parties, public or private, in
whose favor and for whose benefit this Agreement and the covenants running with the land have
been provided. City shall have the right, if the Agreement or any covenants in any agreement
pursuant to this Agreement, including the Ground Lease, are breached, to exercise all rights and
remedies, and to maintain any actions or suits at law or in equity or other proper proceedings to
enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and
such covenants may be entitled.
600. DEFAULTS AND REMEDIES
601. Default Remedies. Subject to the extensions of time set forth in Section 702 of
this Agreement, a material failure by either party to perform any action or covenant required by
this Agreement within the time periods provided herein following notice and failure to cure as
described hereafter, constitutes a "Default" under this Agreement. A party claiming a Default
shall give written notice of Default to the other party specifying the Default complained of.
Except as otherwise expressly provided in this Agreement, the claimant shall not institute any
proceeding against any other party, and the other party shall not be in Default if such party
within thirty (30) days from receipt of such notice immediately, with due diligence, commences
to cure, correct or remedy such failure or delay and shall complete such cure, correction or
remedy with diligence, but in no event later than ninety (90) days from receipt of such notice.
602. Institution of Legal Actions. In addition to any other rights or remedies and
subject to the restrictions otherwise set forth in this Agreement, either party may institute an
action at law or equity to seek specific performance of the terms of this Agreement, or to cure,
correct or remedy any Default, to recover damages for any Default, or to obtain any other
remedy consistent with the purpose of this Agreement. Such legal actions must be instituted in
the Superior Court of the County of Los Angeles, State of California.
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603. Termination by the Developer. In the event that the Developer is not in Default
under this Agreement and prior to the Commencement of the Ground Lease:
(a) City does not tender the leasehold interest in the Site pursuant to
the Ground Lease in the manner and condition and by the date provided in this Agreement, or
(b) One or more of Developer's Conditions Precedent to the
Commencement of the Ground Lease is not fulfilled on or before the time set forth in this
Agreement and such failure is not caused by Developer; or
(c) In the event of any Default of City prior to the Commencement of
the Ground Lease which is not cured within the time set forth in Section 601 hereof, and any
such failure is not cured within the applicable time period after written demand by the
Developer,
then this Agreement may, at the option of the Developer, be terminated by Notice thereof
to City. From the date of the Notice of termination of this Agreement to City and thereafter, this
Agreement shall be deemed terminated and there shall be no further rights or obligations
between the parties, except as provided pursuant to Section 611 hereof.
604. Termination by City. In the event that City is not in Default under this
Agreement and prior to the Commencement of the Ground Lease:
(a) Developer (or any successor in interest) assigns this Agreement or
any rights therein or in the Site in violation of this Agreement; or
(b) One or more of City's Conditions Precedent to the Commencement
of the Ground Lease is not fulfilled on or before the time set forth in this Agreement and such
failure is not caused by City; or
(c) Developer is otherwise in Default of this Agreement and fails to
cure such Default within the time set forth in Section 601 hereof;
(d) The Developer has failed to obtain an allocation of competitive
federal 9% Tax Credits in any of the first two allocation rounds which occur after the date of this
Agreement (the first of which shall be the first application round in 2013), and the parties have
not approved further applications for Tax Credits as provided in Section 406 hereof, or the
Developer has failed to obtain an allocation of competitive federal 9% Tax Credits in any further
rounds approved pursuant to Section 406 hereof, or the Developer has failed to submit a timely
and complete application in any of those rounds prior to obtaining such an allocation;
then this Agreement and any rights of the Developer or any assignee or transferee
with respect to or arising out of the Agreement or the Site, shall, at the option of City, be
terminated by City by Notice thereof to the Developer. From the date of the Notice of
termination of this Agreement by City to the Developer and thereafter this Agreement shall be
deemed terminated and there shall be no further rights or obligations between the parties, except
that City may pursue any remedies it has hereunder.
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1017942.5
605. Termination of Ground Lease Prior to Completion of Construction. City has
the right, at its election, to reenter and take possession of the Site, with all improvements thereon,
and terminate the Ground Lease if after the Commencement of the Ground Lease and prior to the
issuance of the Release of Construction Covenants, the Developer or its successors in interest
shall (subject to permitted extensions of time pursuant to Section 702 hereof):
(a) fail to start the construction of the Housing Development within
the time set forth in the Schedule of Development as required by this Agreement, within ninety
(90) days after written notice thereof from City; or
(b) abandon or substantially suspend construction of the Housing
Development required by this Agreement, within fifteen (15) days after written notice thereof
from City; or
(c) contrary to the provisions of Section 703 transfer or suffer any
involuntary transfer of the Site or any part thereof in violation of this Agreement.
Such right to terminate the Ground Lease and reenter the Site shall be subject to
and be limited by and shall not defeat, render invalid or limit:
Any mortgage or deed of trust permitted by this Agreement; or
2. Any rights or interests provided in this Agreement for the protection of the
holders of such mortgages or deeds of trust. .
606. Attorneys' Fees. In any action between the parties to interpret, enforce, reform,
modify, rescind, or otherwise in connection with any of the terms or provisions of this
Agreement, the prevailing party in the action shall be entitled, in addition to any other relief to
which it might be entitled, reasonable costs and expenses including, without limitation, litigation
costs and reasonable attorneys' fees.
607. Acceptance of Service of Process. In the event that any legal action is
commenced by the Developer against City, service of process on City shall be made by personal
service upon the City Clerk or in such other manner as may be provided by law. In the event that
any legal action is commenced by City against the Developer, service of process shall be made in
such manner as may be provided by law and shall be effective whether served inside or outside
of California.
608. Rights and Remedies Are Cumulative. Except as otherwise expressly stated in
this Agreement, the rights and remedies of the parties are cumulative, and the exercise by either
party of one or more of such rights or remedies shall not preclude the exercise by it, at the same
or different times, of any other rights or remedies for the same Default or any other Default by
the other party.
609. Inaction Not a Waiver of Default. Any failures or delays by either party in
asserting any of its rights and remedies as to any Default shall not operate as a waiver of any
Default or of any such rights or remedies, or deprive either such party of its right to institute and
maintain any actions or proceedings which it may deem necessary to protect, assert or enforce
any such rights or remedies.
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1017942.5 -
610. Applicable Law. The laws of the State of California shall govern the
interpretation and enforcement of this Agreement.
700. GENERAL PROVISIONS
701. Notices, Demands and Communications Between the Parties. Any approval,
disapproval, demand, document or other notice ("Notice") which either party may desire to give
to the other party under this Agreement must be in writing and may be given either by (i)
personal service, (ii) delivery by reputable document delivery service such as Federal Express
that provides a receipt showing date and time of delivery, or (iii) mailing in the United States
mail, certified mail, postage prepaid, return receipt requested, addressed to the address of the
party as set forth below, or at any other address as that party may later designate by Notice.
To City: City of Vernon
4305 Santa Fe Avenue
Vernon, California 90058
Attention: City Administrator
Copy to: City Attorney
Copy to: City Director of Community Services and Water
To Developer: Meta Housing Corporation
1640 A. Sepulveda Blvd., Suite 425
Los Angeles, CA 90025
Attention: John Huskey
With copy to: Bocarsly, Emden, Cowan, Esmail & Arndt, LLP
633 West Fifth Street, 70th Floor
Los Angeles, CA 90071
Attention: Nicole Deddens
Any written notice, demand or communication shall be deemed received
immediately upon receipt; provided, however, that refusal to accept delivery after reasonable
attempts thereto shall constitute receipt. Any notices attempted to be delivered to an address
from which the receiving party has moved without notice shall be effective on the third day from
the date of the attempted delivery or deposit in the United States mail.
702. Enforced Delay; Extension of Times of Performance. In addition to specific
provisions of this Agreement, performance by either party hereunder shall not be deemed to be in
Default, and all performance and other dates specified in this Agreement shall be extended,
where delays or Defaults are due to causes beyond the control or without the fault of the party
claiming an extension of time to perform, which may include, without limitation, the following:
war; acts of terrorism; insurrection; strikes; lockouts; riots; floods; earthquakes; fires; casualties;
acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight embargoes; lack
of transportation; governmental restrictions or priority; litigation; unusually severe weather;
inability to secure necessary labor, materials or tools; delays of any contractor, subcontractor or
supplier (other than a contractor, subcontractor or supplier in which Developer has a twenty-five
percent (25%) or more ownership interest, or which is controlled by Developer, or which is an
affiliated entity of Developer); acts or omissions of the other party; or acts or failures to act of
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1017942.5
the City or any other public or governmental agency or entity (other than the acts or failures to
act of City which shall not excuse performance by City). Notwithstanding anything to the
contrary in this Agreement, an extension of time for any such cause shall be for a reasonable
period, not less than the period of the enforced delay, and shall commence to run from the time
of the commencement of the cause, if notice by the party claiming such extension is sent to the
other party within thirty (30) days of the commencement of the cause. Times of performance
under this Agreement may also be extended in writing by the mutual agreement of City and
Developer, as applicable. The City Administrator (or designee) shall have the authority in his or
her sole and absolute discretion on behalf of City to approve extensions of time not to exceed a
cumulative total of one year. Notwithstanding any provision of this Agreement to the contrary,
the lack of funding to complete the Housing Development shall not constitute grounds of
enforced delay pursuant to this Section 702.
703. Transfers of Interest in Site or Agreement.
703.1 Prohibition. The qualifications and identity of the Developer are of
particular concern to City. It is because of those qualifications and identity that City has entered
into this Agreement with the Developer. For the period commencing upon the date of this
Agreement and throughout the term of the Ground Lease, (a) no voluntary or involuntary
successor in interest of the Developer shall acquire any rights or powers under this Agreement,
(b) the Developer shall not make any total or partial sale, transfer, conveyance, assignment,
subdivision, refinancing or lease of the whole or any part of the Site or the Housing
Development thereon, (c) there shall not be a change in the controlling interest of Developer, and
(d) there shall be no change in the general partners of the Developer, without prior written
approval of City, except as expressly set forth herein.
703.2 Permitted Transfers. Notwithstanding any other provision of this
Agreement to the contrary, City approval of an assignment of this Agreement or conveyance of
the Site or Housing Development, or any part thereof, shall not be required in connection with
any of the following:
(a) The conveyance or dedication of any portion of the Site to the
City, or the granting of easements or permits to facilitate construction of the Housing
Development.
(b) Any required assignment for financing purposes (subject to such
financing being considered and approved by City pursuant to Section 401 herein), including the
grant of a deed of trust to secure the funds necessary for land acquisition, construction and
permanent financing of the Housing Development.
(c) Any transfers to a limited partnership formed for the purpose of
obtaining Tax Credits for the Housing Development, in which Meta Housing Corporation (or an
entity wholly owned by Meta Housing Corporation or John Huskey) is the administrative general
partner and Westem Community Housing, Inc. (or a limited liability company wholly owned by
Western Community Housing, Inc.) is the managing general partner, subject to City approval of
the identity of the limited partners.
(d) Subject to the restrictions of Sections 501 through 514 of this
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1017942.5
Agreement, the Ground Lease and the Regulatory Agreement, the lease of Housing Units to
qualified tenants.
(e) The Developer's conveyance of the Site or the limited partnership
interest in Developer to Meta Housing Corporation, or another entity affiliated with and
controlled by Meta Housing Corporation or John Huskey, in accordance with the option to
purchase set forth in Developer's partnership agreement.
(f) A transfer of a general partnership interest in Developer to a
nonprofit managing general partner entity.
(g) Notwithstanding anything to the contrary contained herein, without
the consent of the City, each Investor Limited Partner shall have the right to assign its interests as
limited partner in the Developer to an entity which is controlled by such Investor Limited Partner
or is under common control with such Investor Limited Partner.
(h) Notwithstanding anything to the contrary contained herein,
Investor Limited Partner shall have the right to remove either general partner of Developer, or
both general partners, and substitute any Investor Limited Partner or an affiliate thereof as a
general partner of the Developer, pursuant to the Partnership Agreement, without City's consent.
Any proposed replacement of a general partner with an entity other than an Investor Limited
Partner or an affiliate thereof will be subject to City's prior consent, which shall not be
unreasonably withheld.
(i) Subject to the restrictions of this DDA, the rental or lease for
occupancy of each of the housing units.
In the event of an assignment by Developer under subparagraph (c) or (e) above
not requiring City's prior approval, Developer nevertheless agrees that at least thirty (30) days
prior to such assignment it shall give written notice to City of such assignment and provide to the
City an assignment and assumption agreement reasonably satisfactory to City. Upon the City's
approval of such assignment and assumption agreement, the assigning Developer shall not be
responsible for any obligations hereunder which arise after the effective date of the assignment
and assumption agreement, provided that the assigning Developer shall retain the
indemnification obligations pursuant to Section 206.7 hereof.
703.3 City Consideration of Requested Transfer. City agrees that it will not
unreasonably withhold approval of a request made pursuant to this Section 703, provided the
Developer delivers written notice to City requesting such approval. Such notice shall be
accompanied by sufficient evidence regarding the proposed assignee's or purchaser's
development and/or operational qualifications and experience, and its financial commitments and
resources, in sufficient detail to enable City to evaluate the proposed assignee or purchaser
pursuant to the criteria set forth in this Section 703 and as reasonably determined by City. City
shall evaluate each proposed transferee or assignee on the basis of its development and/or
qualifications and experience in the operation of facilities similar to the Housing Development,
and its financial commitments and resources, and may reasonably disapprove any proposed
transferee or assignee, during the period for which this Section 703 applies, which City
reasonably determines does not possess sufficient qualifications. An assignment and assumption
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1017942.5
agreement in form satisfactory to the City shall also be required for all proposed assignments.
Within thirty (30) days after the receipt of the Developer's written notice requesting approval of
an assignment or transfer pursuant to this Section 703, including assignments that do not require
City approval, City shall either approve or disapprove such proposed assignment or shall respond
in writing by stating what further information, if any, City reasonably requires in order to
determine the request complete and determine whether or not to grant the requested approval.
Upon receipt of such a response, the Developer shall promptly furnish to City such further
information as may be reasonably requested.
703.4 Successors and Assigns. All of the terms, covenants and conditions of
this Agreement shall be binding upon the Developer and its permitted successors and assigns.
Whenever the term "Developer" is used in this Agreement, such term shall include any other
permitted successors and assigns as herein provided.
703.5 Assignment by City. City may assign or transfer any of its rights or
obligations under this Agreement with the approval of the Developer, which approval shall not
be unreasonably withheld.
704. Non -Liability of Officials and Employees of City and Developer. No member,
official, officer or employee of City or the City shall be personally liable to the Developer, or
any successor in interest, in the event of any Default or breach by City (or the City) or for any
amount which may become due to the Developer or its successors, or on any obligations under
the terms of this Agreement. No member, official, officer or employee of Developer shall be
personally liable to the City, or any successor in interest, in the event of any Default or breach by
Developer or for any amount which may become due to the City or its successors, or on any
obligations under the terms of this Agreement.
705. Relationship Between City and Developer. It is hereby acknowledged that the
relationship between City and Developer is not that of a partnership or joint venture and that City
and Developer shall not be deemed or construed for any purpose to be the agent of the other.
Accordingly, except as expressly provided in this Agreement, including the Attachments hereto,
City shall have no rights, powers, duties or obligations with respect to the development,
operation, maintenance or management of the Housing Development.
706. Lobbying. Developer agrees that no funds have been paid or will be paid, by or on
behalf of the Developer, to any person for influencing or attempting to influence an officer or
employee of the City in connection with the approval or implementation of this Agreement. In
addition, Developer and its officers and employees shall not lobby, influence, or attempt to influence
any residents of the Housing Development or other registered voters of the City with respect to any
matters which require the approval of the City or the electorate of the City. Any violation of this
Section 706 shall be deemed a material breach of this Agreement.
707. City Approvals and Actions. The City shall maintain authority of this
Agreement and the authority to implement this Agreement through the City Administrator (or
designee). The City Administrator (or designee) shall have the authority to make approvals,
issue interpretations, waive provisions, make and execute further agreements and/or enter into
amendments of this Agreement on behalf of the City so long as such actions do not materially or
substantially change the uses or development permitted on the Site, or materially or substantially
34
1017942.5
add to the costs incurred or to be incurred by the City as specified herein, and such
interpretations, waivers and/or amendments may include extensions of time to perform as
specified in the Schedule of Performance. All other material and/or substantive interpretations,
waivers, or amendments shall require the consideration, action and written consent of the City
Council.
708. Amendments to Agreement. In the event that Developer, or its lenders or equity
investors, requests any amendments to this Agreement, or any of the documents to be executed
pursuant to this Agreement, the City shall reasonably consider such request. Any costs incurred
by the City in connection with such requested amendments, including without limitation
attorneys' fees for the review of the request and preparation of an amendment, and the cost of the
City's consultants for undertaking economic analysis of the proposed amendment, shall be bome
by the party which requests the amendment.
709. Counterparts. This Agreement may be signed in multiple counterparts which,
when signed by all parties; shall constitute a binding agreement. This Agreement is executed in
three (3) originals, each of which is deemed to be an original.
710. Integration. This Agreement contains the entire understanding between the
parties relating to the transaction contemplated by this Agreement. All prior or contemporaneous
agreements, understandings, representations and statements, oral or written, are merged in this
Agreement and shall be of no further force or effect. Each party is entering this Agreement
based solely upon the representations set forth herein and upon each party's own independent
investigation of any and all facts such party deems material. This Agreement includes
Attachment Nos. 1 through 9, which together constitute the entire understanding and agreement
of the parties, notwithstanding any previous negotiations or agreements between the parties or
their predecessors in interest with respect to all or any part of the subject matter hereof.
711. Real Estate Brokerage Commissions. City and Developer each represent and
warrant to the other that no broker or finder is entitled to any commission or finder's fee in .
connection with this transaction, and each agrees to defend and hold harmless the other from any
claim to any such commission or fee resulting from any action on its part.
712. Titles and Captions. Titles and captions are for convenience of reference only
and do not define, describe, or limit the scope or the intent of this Agreement or of any of its
terms. Reference to section numbers are to sections in this Agreement, unless expressly stated
otherwise.
713. Interpretation. As used in this Agreement, masculine, feminine or neuter gender
and the singular or plural number shall each be deemed to include the others where and when the
context so dictates. The word "including" shall be construed as if followed by the words
"without limitation." This Agreement shall be interpreted as though prepared jointly by both
parties.
714. No Waiver. A waiver by either party of a breach of any of the covenants,
conditions or agreements under this Agreement to be performed by the other party shall not be
construed as a waiver of any succeeding breach of the same or other covenants, agreements,
restrictions or conditions of this Agreement.
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1017942.5
715. Modifications. Any alteration, change, or modification of or to this Agreement,
in order to become effective, shall be made in writing and in each instance signed on behalf of
each party.
716. Severability. If any term, provision, condition, or covenant of this Agreement or
its application to any party or circumstances shall be held, to any extent, invalid or
unenforceable, the remainder of this Agreement, or the application of the term, provision,
condition or covenant to persons or circumstances other than those as to whom or which it is
held invalid or unenforceable, shall not be affected, and shall be valid and enforceable to the
fullest extent permitted by law.
717. Computation of Time. The time in which any act is to be done under this
Agreement is computed by excluding the first day (such as the day escrow opens), and including
the last day, unless the last day is a holiday or Saturday or Sunday, and then that day is also
excluded. The term "holiday" shall mean all holidays as specified in Section 6700 and 6701 of
the California Government Code. If any act is to be done by a particular time during a day, that
time shall be Pacific Time Zone time.
718. Legal Advice. Each party represents and warrants to the other the following:
they have carefully read this Agreement, and.in signing this Agreement, they do so with full
knowledge of any right which they may have; they have received independent legal advice from
their respective legal counsel as to the matters set forth in this Agreement, or have knowingly
chosen not to consult legal counsel as to the matters set forth in this Agreement; and, they have
freely signed this Agreement without any reliance upon any agreement, promise, statement or
representation by or on behalf of the other party, or their respective agents, employees, or
attorneys, except as specifically set forth in this Agreement, and without duress or coercion,
whether economic or otherwise.
719. Time of Essence. Time is expressly made of the essence with respect to the
performance by the parties of each and every obligation and condition of this Agreement.
720. Cooperation. Each party agrees to cooperate with the other in this transaction
and, in that regard, to sign any and all documents which may be reasonably necessary, helpful, or
appropriate to carry out the purposes and intent of this Agreement including, but not limited to,
releases or additional agreements.
721. Conflicts of Interest. No member, official or employee of City shall have any
personal interest, direct or indirect, in this Agreement, nor shall any such member, official or
employee participate in any decision relating to the Agreement which affects his personal
interests or the interests of any limited partnership, partnership or association in which he is
directly or indirectly interested.
722. Time for Acceptance of Agreement by City. This Agreement, when executed
by the Developer and delivered to City, must be authorized, executed and delivered by City on or
before thirty (30) days after signing and delivery of this Agreement by the Developer or this
Agreement shall be void, except to the extent that the Developer shall consent in writing to a
further extension of time for the authorization, execution and delivery of this Agreement.
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1017942.5
723. No Third Party Beneficiaries. Notwithstanding any other provision of this
Agreement to the contrary, nothing herein is intended to create any third party beneficiaries to
this Agreement, and no person or entity other than City and Developer, and the permitted
successors and assigns of any of them, shall be authorized to enforce the provisions of this
Agreement.
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1017942.5
IN WITNESS WHEREOF, City and the Developer have executed this Agreement as of
the date first set forth above.
ATTEST:
City Clerk
APPROVED AS TO FORM:
Nicholas George Rodriguez,
City Attorney
Kronick Moskovitz Tiedemann & Girard,
Special Counsel to City
CITY:
CITY OF VERNON, a California charter city and
municipal corporation
LE
DEVELOPER:
META HOUSING CORPORATION, a
California corporation
0
M
38
1017942.5
ATTACHMENT NO. 1
SITE MAP
[To Be Inserted]
Attachment No. I - 1
1017942.5
N1
1
EXHIBIT III
SITE MAP
4601 E. 52nd STREET
VERNON, CALIFORNIA
CALE: P - 170f FT.
JANUARY 2013
Lea Associates
Property Economics m
ATTACHMENT NO.2
SITE LEGAL DESCRIPTION
That real property located in the City of Vernon, County of Los Angeles, State of California,
described as follows:
Lot Nos. 45 through 53 of Tract No. 7923
APN: 6314-002-900(portion)
Attachment No. 2-1
1017942.5
ATTACHMENT NO.3
GROUND LEASE
[To Be Inserted]
Attachment No. 3-1
1017942.5
GROUND LEASE
By and Between
CITY OF VERNON,
LESSOR
and
[META HOUSING CORPORATION LIMITED PARTNERSHIP],
LESSEE
1017953.5
GROUND LEASE
This GROUND LEASE (the "Lease") is made as of 201 (the
"Commencement Date"), by and between the CITY OF VERNON, a California charter city and
municipal corporation (the "City" or "Lessor"), and [Meta Housing Corporation Limited
Partnership], a California limited partnership (the "Lessee").
1. SUBJECT OF LEASE.
The purpose of this Lease is the lease of the "Site" (as hereinafter defined) to Lessee for
the development and operation thereon of a forty-five unit multifamily apartment complex (the
"Housing Development"). This Lease is entered into pursuant to a Disposition and
Development Agreement between City and Lessee dated February 19, 2013 (the "DDA"), and a
Regulatory Agreement between City and Lessee dated 201 (the "Regulatory
Agreement").
2. LEASE OF THE SITE.
City, for and in consideration of the rents, covenants, and agreements hereinafter reserved
and contained on the part of Lessee to be paid, kept, performed and observed by Lessee, hereby
leases to Lessee, and Lessee hereby leases from City, that certain real property in the City of
Vernon (the "City") shown on the "Site Map" attached hereto as Exhibit "A" and incorporated
herein by this reference, and having the legal description in the "Site Description" attached
hereto as Exhibit `B" and incorporated herein by this reference (the "Site"). Except as expressly
provided to the contrary in this Lease, reference to the Site is to the described land, exclusive of
any improvements now or hereafter located on the land, notwithstanding that any such
improvements may or shall be construed as affixed to and as constituting part of the real
property.
3. LEASE TERM.
Lessee shall lease the Site from City and City shall lease the Site to Lessee for a term
extending from the Commencement Date of this Lease (the date set forth in the first paragraph
hereof) until the sixty-fifth (65th) anniversary of the Commencement Date (the "Initial Term"),
unless sooner terminated as provided for herein. Provided that no Event of Default has occurred
and is continuing under this Lease as of the expiration of the Initial Term, Lessee shall, by
delivery of written notice to City no later than twelve (12) months and no earlier than twenty-
four (24) months prior to the expiration of the Initial Tenn, have the right to extend the term of
this Lease for an additional ten (10) year period (the "Extended Term") on the same terms and
conditions contained in this Lease, commencing on the expiration of the Initial Term. The Initial
Term and the Extended Term are collectively referred to herein as the "Term."
4. RENT.
4.1 Net Lease. It is the intent of the parties hereto that the rent provided herein shall
be absolutely net to City and that Lessee shall pay all costs, taxes, charges, and expenses of every
kind and nature against the Site and the Housing Development which may arise or become due
during the Term, and which, except for execution hereof, would or could have been payable by
1017953.5
city
4.2 Basic Rent. During the Initial Term and Extended Term, Lessee agrees to pay
City advance annual rent in the amount of One Dollar ($1.00) (the "Basic Rent"). The Basic
Rent shall be paid on the Commencement Date and each anniversary thereof.
4.3 Additional Rent. The parties agree that upon the occurrence of certain events as
set forth below, if Lessee receives cash proceeds as a result of such events, City shall receive a
portion of such proceeds as Additional Rent. For these purposes, receipt by Lessee of value in a
form other than cash will be treated as receipt by Lessee of the cash equivalent of such value
based on the fair market value of what is received by Lessee.
a. Determination of Fair Market Rent Upon Certain Events. Additional
Rent shall become due in the event of and upon the occurrence of any of the following: (1) the
refinancing of the Project Loan (as defined in Section 15 hereof), (2) Lessee's sale or assignment
of its interest in the Housing Development and this Lease, (3) the expiration of the Tax Credit
Regulatory Agreement (as defined in the DDA), (4) the commencement of the Extension Term
of this Lease, (5) completion of foreclosure proceedings for the Project Loan, and (6) affirmation
of the Ground Lease in a bankruptcy proceeding. In each such event, Additional Rent shall be
calculated as follows:
The Additional Rent shall be the fair market value ground lease rent for the Site
pursuant to the Ground Lease, taking into consideration the restrictions recorded against the Site,
to the extent such restrictions remain applicable and enforceable (the "Applicable Recorded
Restrictions"). The fair market rent shall be determined by an independent appraisal performed
by a qualified, independent appraiser who is reasonably acceptable to City and Lessee. Such
independent appraisal shall determine the fair market value of the Site, at its highest and best use,
but subject to the Applicable Recorded Restrictions. The appraisal shall further determine the
fair market value ground lease rent, subject to the Applicable Recorded Restrictions, over the
entire Tern of this Lease (including the Extended Term, as applicable), with an objective that the
City cumulatively receive over the entire Term of this Lease the fair market value ground lease
rent under the Ground Lease, subject to the Applicable Recorded Restrictions. In such regard, if
the total amount of Rent paid to that date has cumulatively amounted to less than a fair market
value ground lease rent, subject to the Applicable Recorded Restrictions, then the appraiser shall
take that fact into consideration when determining the Additional Rent for the remainder of the
Term (including the Extended Term, as applicable). Likewise, if the total amount of Rent paid to
that date has cumulatively amounted to greater than a fair market value ground lease rent, subject
to the Applicable Recorded Restrictions, then the appraiser shall take that fact into consideration
when determining the Additional Rent for the remainder of the Term (including the Extended
Term, as applicable). Notwithstanding the foregoing, however, in no event shall the Additional
Rent in any year (a) be a negative number, or (b) exceed fifty percent (50%) of the Residual
Receipts of the Housing Development. For purposes hereof, "Residual Receipts" shall mean
annual project revenue less the sum of (i) operating expenses, (ii) debt service, (iii) reserve
deposits, (iv) partnership management fees, (v) deferred developer fees, and (vi) asset
management fees, for each calendar year; provided, however, that if such calculation results in a
negative number, Residual Receipts shall be zero for that year. Upon the occurrence of any of
1017953.5
the above events triggering the obligation to pay Additional Rent, the parties shall mutually
agree upon procedures for reporting and determining Residual Receipts.
b. Payment Upon Refinancing. If in accordance with Section 15 hereof
Lessee borrows money whose repayment is secured, directly or indirectly, by Lessee's leasehold
interest hereunder, in a transaction that does not involve an Assignment as described in
paragraph (c) below, Lessee shall pay City a sum equal to fifty percent (50%) of the Net
Financing Proceeds (as defined below) as Additional Rent. If there are other Project Loans or
Permitted Encumbrances which also require payment of a portion of Net Financing Proceeds,
Lessee shall use good faith efforts to reach an agreement with such other lender or lenders as to
an equitable distribution of Net Financing Proceeds between or among such parties. Such
Additional Rent shall be due and payable immediately upon the funding of the loan, and shall be
payable in addition to any other sums payable by Lessee under this Lease. Lessee shall provide
City a complete accounting of the Net Financing Proceeds. No Additional Rent shall be payable
upon the closing of the initial construction loan and permanent loan permitted pursuant to
Section 401 of the DDA. For purposes of this paragraph, "Net Financing Proceeds" shall mean
the initial principal sum of the new loan, less (i) all costs and expenses paid by Lessee for all
capital improvements completed by Lessee in accordance with the terms of the DDA and this
Lease or otherwise expressly consented to by City in writing (and for purposes of this clause (i),
such costs may include, without limitation, reasonable architects' and engineers' fees and other
reasonable "soft" costs, as such term is customarily understood in the construction industry in
Los Angeles, California, relating to the making of such permitted capital improvements), (ii)
actual and reasonable costs of refinancing, (iii) the amount by which the refinancing lender
requires Lessee to increase Lessee's reserves for the Housing Development as a condition of
such refinancing, and (iv) any amount paid to the limited partner in Lessee (who purchased such
interest in order to benefit from the favorable tax treatment arising from the Housing
Development for any repurchase or redemption of such partner's limited partnership interest in
Lessee completed by Lessee in accordance with the terms of this Lease).
C. Payment Upon Sale or Assignment. If Lessee sells or assigns its interest
in the Housing Development and this Lease, directly or indirectly, other than through a Permitted
Transfer (as defined in Section 703.2 of the DDA), Lessee shall pay City a sum equal to fifty
percent (50%) of the Net Sales Proceeds (as defined below) as Additional Rent. If there are
other Project Loans or Permitted Encumbrances which also require payment of a portion of Net
Sales Proceeds, Lessee shall use good faith efforts to reach an agreement with such other lender
or lenders as to an equitable distribution of Net Sales Proceeds between or among such parties.
Such Additional Rent shall be due and payable immediately upon the closing of the sale or
assignment, and shall be payable in addition to any other sums payable by Lessee under this
Lease. Lessee shall provide City a complete accounting of the Net Sale Proceeds. For purposes
of the first sale or assignment, "Net Sales Proceeds" shall mean the total purchase price of the
Housing Development payable to Lessee, less the total cost of construction of the Housing
Project [add definition of total cost of construction]. For purposes of subsequent sales or
assignments, "Net Sales Proceeds" shall mean the total purchase price of the Housing
Development payable to Lessee, less the purchase'price paid by Lessee.
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d. Payment of Additional Rent into Capital Account. City may elect, at
its sole discretion, for all or a portion of the Additional Rent to be deposited directly into a
capital account to be established by Lessee instead of being paid to City. In such event City and
Lessee shall mutually agree upon the permitted uses of the capital account, which may include
such uses as specified capital improvements to the Housing Development and social service
programs for the benefit of the residents of the Housing Development.
4.4 Payment of Rent. All rent that becomes due and payable pursuant to this Lease
shall be paid to City at the address of City listed in Section 25.7 or such other place as City may
from time to time designate by written notice to the Lessee without notice or demand, and
without setoff, counterclaim, abatement, deferment, suspension or deduction.
5. USE OF THE SITE.
5.1. Use of the Site. Lessee covenants and agrees for itself, its successors and assigns,
that during the Term, the Site and the Housing Development shall be devoted to those uses as set
forth in this Lease, the DDA and the Regulatory Agreement. Lessee covenants and agrees to
cause the Housing Development to be used only for the purposes set forth in Section 6 hereof,
and no other uses without the prior approval of the City, which approval may be given or
withheld as provided therein.
5.2. Only Lawful Uses Permitted. Lessee shall not use the Site or the Housing
Development for any purpose that is in violation of any law, ordinance or regulation of any
federal, state, county or local governmental agency, body or entity. Furthermore, Lessee shall
not maintain or commit any nuisance or unlawful conduct (as now or hereafter defined by any
applicable statutory or decisional law) on the Site or the Housing Development, or any part
thereof.
5.3 Prohibition on Lobbying. Lessee and its officers and employees shall not lobby,
influence, or attempt to influence any residents of the Housing Development or other registered
voters of the City with respect to any matters which require the approval of the City or the
electorate of the City. Any violation of this Section 5.3 shall be deemed a material breach of this
Lease.
6. OPERATING COVENANT.
6.1. Operation in Accordance with Agreement. The Lessee covenants and agrees
that, at all times during the Term of this Lease, Lessee shall operate the Housing Development as
a forty-five unit multifamily apartment project in accordance with the DDA, the Regulatory
Agreement and this Lease. All uses conducted on the Site, including, without limitation, all
activities undertaken by the Lessee pursuant to this Lease, shall conform to all applicable
provisions of the City Municipal Code, and the recorded documents pertaining to and running
with the Site.
6.2 Subordination of Affordability Requirements. In the event that the City finds
that an economically feasible method of financing for the construction and operation of the
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Housing Development, without the subordination of the affordable housing covenants as may be
set forth in the DDA, this Lease and the Regulatory Agreement, is not reasonably available, the
City shall make the affordable housing covenants set forth in the DDA, this Lease and the
Regulatory Agreement junior and subordinate to the deeds of trust and other documents required
in connection with the construction and permanent financing for the Housing Development
approved pursuant to Section 401 of the DDA. Any subordination agreement entered into by the
City shall contain written commitments which the City finds are reasonably designed to protect
City's investment in the event of Default, such as either of the following: (a) a right of City to
cure a default on the loan prior to foreclosure, or (b) a right of City to negotiate with the lender
after notice of default from the lender and prior to foreclosure.
7. UTILITIES AND TAXES.
7.1 Utilities. Lessee shall pay all charges for gas, electricity, garbage collection; and
other utilities furnished to the Site and the Housing Development and all hookup or similar
charges or assessments for utilities levied against the Site and the Housing Development for any
period included within the Term.
7.2 Real Estate Taxes.
(a) Lessee covenants and agrees to pay before delinquency all real estate
taxes, assessments and liens of every kind and nature upon Lessee's possessory interest in the
Site and the Housing Development. "Real estate taxes" shall mean all real estate taxes,
assessments for improvements to the Site, public agency water and sewer rates and charges, or
any other assessments or taxes, which shall be levied against the Site or the Housing
Development, or any interest therein, and which become a lien thereon and accrue during the
Term.
(b) Lessee shall have the right to apply for and receive a welfare exemption
from the payment of property taxes pursuant to Revenue and Taxation Code Section 214(g) (or
successor statute).
(c) Lessee shall have the right to contest the amount or validity of any real
estate taxes, in whole or in part, by appropriate administrative and legal proceedings, without any
costs or expense to City.
7.3 Personal Property. Lessee covenants and agrees to pay before delinquency all
personal property taxes, assessments and liens of every kind and nature upon all personal
property as may be from time to time situated within the Site and the Housing Development.
8. OWNERSHIP OF IMPROVEMENTS, FIXTURES AND FURNISHINGS.
8.1. Ownership During Term. All improvements constructed on the Site by Lessee as
permitted by this Lease (the "Housing Development") shall, during the Term, be and remain the
property of Lessee; provided, however, that Lessee shall have no right to waste the Housing
Development, or to destroy, demolish or remove the Housing Development except as otherwise
permitted pursuant to this Lease; and provided further that Lessee's rights and powers with
respect to the Housing Development are subject to the terms and limitations of this Lease.
1017953.5
9. INDEMNIFICATION: FAITHFUL PERFORMANCE.
Lessee shall not suffer or permit any liens to be enforced against the City's fee simple
estate as to the Site, to City's fee simple estate in reversion of the Housing Development, nor
against Lessee's leasehold interest therein by reason of work, labor, services or materials
supplied or claimed to have been supplied to Lessee or anyone holding the Site and the Housing
Development, or any part thereof, through or under Lessee. Lessee agrees to defend, indemnify,
and hold City and its officers, officials, employees, agents, and representatives, harmless against
such liens. If any such lien shall at any time be filed against the Site or the Housing
Development, Lessee shall, within thirty (30) days after notice to Lessee of the filing thereof,
cause the same to be discharged of record; provided, however, that Lessee shall have the right to
contest the amount or validity, in whole or in part, of any such lien by appropriate proceedings
but in such event, Lessee shall notify City and promptly bond such lien in the manner authorized
by law with a responsible surety company qualified to do business in the State of California or
provide other security acceptable to City. Lessee shall prosecute such proceedings with due
diligence. Nothing in this Lease shall be deemed to be, nor shall be construed in any way to
constitute, the consent or request of City, express or implied, by inference or otherwise, to any
person, firm or limited partnership for the performance of any labor or the furnishing of any
materials for any construction, rebuilding, alteration or repair of onto the Site, the Housing
Development, or any part thereof. Prior to commencement of construction of the Housing
Development on the Site, or any repair or alteration thereto, Lessee shall give City not less than
thirty (30) days advance notice in writing of intention to begin said activity in order that
nonresponsibility notices may be posted and recorded as provided by State and local laws.
10. MAINTENANCE AND REPAIR..
Lessee agrees to assume full responsibility for the management, operation and
maintenance of the Housing Development and the Site throughout the Term without expense to
City, and to perform all repairs and replacements necessary to maintain and preserve the Housing
Development and the Site in good repair, in a neat, clean, safe and orderly condition, in
accordance with the standard of maintenance of high quality apartment projects within Los
Angeles County, California, reasonably satisfactory to City and in compliance with all applicable
laws. Lessee shall maintain the Housing Development, all buildings, all exterior facades, all
sidewalks, and all exterior areas, in a safe and sanitary fashion. The Lessee agrees to provide
utility services, administrative services, supplies, contract services, maintenance, maintenance
reserves, and management which are necessary for the maintenance of the Housing
Development. Lessee agrees that City shall not be required to perform any maintenance, repairs
or services or to assume any expense in connection with the Housing Development and the Site.
Lessee hereby waives all rights to make repairs or to cause any work to be performed at the
expense of City as may be provided for in Section 1941 and 1942 of the California Civil Code, if
applicable. The Lessee shall manage and maintain the Housing Development on the Site in
conformity with the City Municipal Code. Parking lots, lighting fixtures, trash enclosures, and
all areas which can be seen from the adjacent streets shall be kept free from any debris or waste
materials by regularly scheduled maintenance.
1017953.5
11. ENVIRONMENTAL MATTERS.
11.1 Definitions. For the purposes of this Lease, unless the context otherwise specifies
or requires, the following terms shall have the meanings herein specified:
(a) The term "Hazardous Materials" shall mean any substance, material, or
waste which is or becomes regulated by any local governmental authority, the County of
Riverside, the State of California, regional governmental authority or the United States
Government, including, but not limited to, any material or substance which is (i) defined as a
"hazardous waste," "extremely hazardous waste," or "restricted hazardous waste" under Section
25115, 25117 or 25122.7, or listed pursuant to Section 25140 of the California Health and Safety
Code, Division 20, Chapter 6.5 (Hazardous Waste Control Law)), (ii) defined as a "hazardous
substance" under Section 25316 of the California Health and Safety Code, Division 20, Chapter
6.8 (Carpenter -Presley -Tanner Hazardous Substance Account Act), (iii) defined as a "hazardous
material," "hazardous substance," or "hazardous waste" under Section 25501 of the California
Health and Safety Code, Division 20, Chapter 6.95 (Hazardous Materials Release Response
Plans and Inventory), (iv) defined as a "hazardous substance" under Section 25281 of the
California Health and Safety Code, Division 20, Chapter 6.7 (Underground Storage of
Hazardous Substances), (v) petroleum, (vi) friable asbestos, (vii) polychlorinated byphenyls,
(viii) listed under Article 9 or defined as "hazardous" or "extremely hazardous" pursuant to
Article 11 of Title 22 of the California Code of Regulations, Division 4, Chapter 20, (ix)
designated as "hazardous substances" pursuant to Section 311 of the Clean Water Act (33 U.S.C.
§ 1317), (x) defined as a "hazardous waste" pursuant to Section 1004 of the Resource
Conservation and Recovery Act, 42 U.S.C. §6901 et seq. (42 U.S.C. §6903) or (xi) defined as
"hazardous substances" pursuant to Section 101'of the Comprehensive Envirorunental Response,
Compensation, and Liability Act, 42 U.S.C. §9601 et seq. "Hazardous Materials" shall not
include such products in quantities as are customarily used in the construction, maintenance,
rehabilitation or management of residential developments or associated buildings and grounds, or
typically used in residential activities in a manner typical of other comparable residential
developments, or substances commonly ingested by a significant population living within the
Housing Development, including without limitation alcohol, aspirin, tobacco and saccharine.
(b) The term "Hazardous Materials Contamination" shall mean the
contamination (whether presently existing or hereafter occurring) of the improvements, facilities,
soil, groundwater, air or other elements on, in or of the Site by Hazardous Materials, or the
contamination of the buildings, facilities, soil, groundwater, air or other elements on, in or of any
other property as a result of Hazardous Materials at any time (whether before or after the Date of
Lease) emanating from the Site.
(c) The term "Governmental Requirements" shall mean all past, present and
future laws, ordinances, statutes, codes, rules, regulations, orders and decrees of the United
States, the state, the county, the city, or any other political subdivision in which the Site is
located, and any other state, county city, political subdivision, agency, instrumentality or other
entity exercising jurisdiction over City, Lessee or the Site.
11.2 Site Evaluation. Pursuant to Sections 205 and 206 of the DDA, Lessee has had
an opportunity, prior to the Commencement Date of this Lease, to engage its own environmental
1017953.5
consultant to make such investigations of the Site as Lessee has deemed necessary, and Lessee
has approved the environmental condition of the Site. Lessee assumes any and all responsibility
and Liabilities (as defined in Section 11.3 of this Lease) for all Hazardous Materials
Contamination of the Site which occurs during the Tenn of this Lease or extension thereof.
11.3 Indemnification. Upon and after the Commencement Date of this Lease, Lessee
agrees to indemnify, defend and hold City harmless from and against any claim, action, suit,
proceeding, loss, cost, damage, liability, deficiency, fine, penalty, punitive damage, or expense
(including, without limitation, reasonable attorneys' fees), resulting from, arising out of, or based
upon (i) the release, use, generation, discharge, storage or disposal of any Hazardous Materials
on, under, in or about, or the transportation of any such Hazardous Materials to or from, the Site
during the term of this Lease, or (ii) the violation, or alleged violation, of any statute, ordinance,
order, rule, regulation, permit, judgment or license relating to the use, generation, release,
discharge, storage, disposal or transportation of Hazardous Materials on, under, in or about, to or
from, the Site during the term of this Lease, excepting only any such loss, liability, claim, or
judgment arising out of the intentional wrongdoing or gross negligence of City, or its officers,
officials, employees, members, agents, volunteers, or representatives. This indemnity shall
include, without limitation, any damage, liability, fine, penalty, cost or expense arising from or
out of any claim, action, suit or proceeding, including injunctive, mandamus, equity or action at
law, for personal injury (including sickness, disease or death), tangible or intangible property
damage, compensation for lost wages, business income, profits or other economic loss, damage
to the natural resource or the environment, nuisance, contamination, leak, spill, release or other
adverse effect on the environment. Lessee's obligations under this Section 11.3 shall survive the
expiration of this Lease.
City agrees to indemnify, defend and hold Lessee and its officers, employees, agents and
representatives harmless from and against any claim, action, suit, proceeding, damage, liability,
deficiency, fine, penalty, or punitive damage (including, without limitation, reasonable attorneys'
fees), resulting from, arising out of, or based upon the negligent acts or willful misconduct of the
City or its officers, employees, agents, representatives or contractors with respect to the disposal
or handling of any Hazardous Materials on, under, in or about, or the transportation of any such
Hazardous Materials to or from, the Site. At the request of the City, the Lessee shall cooperate
with and assist the City in its defense of any such claim, action, suit, proceeding, loss, cost,
damage, liability, deficiency, fine, penalty, punitive damage, or expense; provided that the
Lessee shall not be obligated to incur any expense in connection with such cooperation or
assistance.
11.4 Duty to Prevent Hazardous Materials Contamination. Lessee shall take all
commercially reasonable precautions to prevent the release of any Hazardous Materials into the
environment. Such precautions shall include compliance with all Governmental Requirements
with respect to Hazardous Materials. In addition, Lessee shall install and utilize such equipment
and implement and adhere to such procedures as are consistent with commercially reasonable
standards generally applied by similar industrial facilities as respects the disclosure, storage, use,
removal, and disposal of Hazardous Materials.
11.5 Obligation of Lessee to Remediate Premises. Lessee shall, at its sole expense,
design and install a vapor barrier and a venting system to reduce the vapor release from the Site
1017953.5
to an acceptable level, and perform all Remediation required pursuant to the DDA.
Notwithstanding the obligation of Lessee to indemnify City pursuant to Section 11.3 of this
Lease, Lessee shall, at its sole cost and expense, promptly take (i) all actions required by any
federal, state, regional, or local governmental agency or political subdivision or any
Governmental Requirements and (ii) all actions necessary and commercially reasonable to
develop and operate the Housing Development in accordance with this Lease, which
requirements or necessity arise from the presence upon, about or beneath the Site of any
Hazardous Materials or Hazardous Materials Contamination no matter when occurring. Such
actions shall include, but not be limited to, the investigation of the environmental condition of
the Site, the preparation of any feasibility studies or reports and the performance of any cleanup,
remedial, removal or restoration work. Lessee shall take all actions necessary to promptly
restore the Site to an environmentally sound condition for the uses contemplated by this Lease
notwithstanding any lesser standard of remediation allowable under applicable Governmental
Requirements. The Lessee's duties hereunder shall not affect any rights Lessee has pursuant to
Section 11.3 hereof.
11.6 Right of Entry. Notwithstanding any other term or provision of this Lease,
Lessee shall permit City or its agents or employees to enter the Site at any time during normal
business hours (except in the event of an emergency ), without prior notice in the event of an
emergency, and with not less than forty-eight (48) hours advance notice if no emergency is
involved, to inspect, monitor and/or take emergency or long-term remedial action with respect to
Hazardous Materials and Hazardous Materials Contamination on or affecting the Site, or to
discharge Lessee's obligations hereunder with respect to such Hazardous Materials and
Hazardous Materials Contamination when Lessee has failed to do so after notice from City and
an opportunity to cure such deficiency. All costs and expenses incurred by City in connection
with performing Lessee's obligations hereunder shall be reimbursed by Lessee to City within
thirty (30) days of Lessee's receipt of written request therefor.
11.7 Storage or Handling of Hazardous Materials. Lessee, at its sole cost and
expense, shall comply and shall cause its tenants to comply with all Governmental Requirements
for the storage, use, transportation, handling and disposal of Hazardous Materials on or about the
Site, including without limitation wastes generated in connection with the uses conducted on the
Site. In the event Lessee will store, use, transport, handle or dispose of any Hazardous Materials,
Lessee shall notify City in writing at least ten (10) days prior to their first appearance on the Site
and Lessee's failure to do so shall constitute a material default under this Lease. Lessee shall
conduct all monitoring activities required or prescribed by applicable Governmental
Requirements, and shall, at its sole cost and expense, comply with all posting requirements of
Proposition 65 or any other similarly enacted Governmental Requirements. In addition, in the
event of any complaint or governmental inquiry, or if otherwise deemed necessary by City in its
reasonable judgment, City may require Lessee, at Lessee's sole cost and expense, to conduct
specific monitoring or testing activities with respect to Hazardous Materials on the Site. Such
monitoring programs shall be in compliance with applicable Governmental Requirements, and
any program related to the specific monitoring of or testing for Hazardous Materials on the Site,
shall be satisfactory to City, in City's reasonable discretion. Lessee shall further be solely
responsible, and shall reimburse City, for all costs and expenses incurred by City arising out of
or connected with the removal, clean-up and/or restoration work and materials necessary to
return the Site and any property adjacent to the Site affected by Hazardous Materials emanating
1017953.5
from the Site to their condition existing at the time of the Lessee's Site Evaluation. Lessee's
obligations hereunder shall survive the termination of this Lease.
11.8 Environmental Inquiries. Lessee shall notify City, and provide to City a copy
or copies, of the following environmental permits, disclosures, applications, entitlements or
inquiries relating to the Site: notices of violation, notices to comply, citations, inquiries,
clean-up or abatement orders, cease and desist orders, reports filed pursuant to self -reporting
requirements, and reports filed or applications made pursuant to any Governmental Requirement
relating to Hazardous Materials and underground tanks, and Lessee shall report to City, as soon
as possible after each incident, any unusual, potentially important incidents.
In the event of a release of any Hazardous Materials into the environment, Lessee shall,
as soon as possible after the release, furnish to City a copy of any and all reports relating thereto
and copies of all correspondence with governmental agencies relating to the release. Upon
request of City, Lessee shall furnish to City a copy or copies of any and all other environmental
entitlements or inquiries relating to or affecting the Site including, but not limited to, all permit
applications, permits and reports including, without limitation, those reports and other matters
which may be characterized as confidential.
12. ALTERATION OF IMPROVEMENTS.
Upon completion of the Housing Development pursuant to the requirements of the DDA,
Lessee shall not make or permit to be made any structural alteration of the exterior of the
Housing Development, nor demolish all or any part of the Housing Development, without
obtaining all required City permits and entitlements, and without obtaining the prior written
consent of City, which consent shall not be unreasonably withheld. The foregoing shall not
prohibit or restrict the repair and/or replacement of the Housing Development by Lessee in
accordance with Section 10 hereof. In requesting such consent of the City Lessee shall submit to
City detailed plans and specifications of the proposed work and an explanation of the need and
reasons therefor. This provision shall not limit or set aside any obligation of Lessee under this
Lease to maintain the Housing Development and the Site in a clean and safe condition, including
structural repair and restoration of damaged Housing Development. City shall not be obligated
by this Lease to make any improvements to the Site or to assume any expense therefor. Lessee
shall not commit or suffer to be committed any waste or impairment of the Site or the Housing
Development, or any part thereof, except as otherwise permitted pursuant to this Lease.
13. DAMAGE OR DESTRUCTION.
13.1 Obligation to Repair and Restore Damage Due to Casualty Covered by
Insurance. Subject to Section 13.3 below, if the Housing Development shall be totally or
partially destroyed or rendered wholly or partly uninhabitable by fire or other casualty required
to be insured against by Lessee, Lessee shall promptly proceed to obtain insurance proceeds and
take all steps necessary to begin reconstruction and, immediately upon receipt of insurance
proceeds, to promptly and diligently commence the repair or replacement of the Housing
Development to substantially the same condition as the Housing Development is required to be
maintained in pursuant to this Lease, whether or not the insurance proceeds are sufficient to
cover the actual cost of repair, replacement, or restoration, and Lessee shall complete the same as
1017953.5 10
soon as possible thereafter so that the Housing Development can be occupied in accordance with
this Lease. Subject to Section 25.22, in no event shall the repair, replacement, or restoration
period exceed one (1) year from the date Lessee obtains insurance proceeds unless the City
Administrator or designee, in his or her sole and absolute discretion, approves a longer period of
time. City shall cooperate with Lessee, at no expense to City, in obtaining any governmental
permits required for the repair, replacement, or restoration. If, however, the then -existing laws
of any other governmental agencies with jurisdiction over the Site do not permit the repair,
replacement, or restoration, Lessee may elect not to repair, replace, or restore the Housing
Development by giving notice to City (in which event Lessee will be entitled to all insurance
proceeds, subject to Lessee's obligations to lenders or other third parties, but Lessee shall be
required to remove all debris from the Site) or Lessee may reconstruct such other improvements
on the Site as are consistent with applicable land use regulations and approved by the City, and
all other governmental agency or agencies with jurisdiction. In the event Lessee elects not to
repair, replace, or restore and give City notice of such election as provided herein, this Lease
shall terminate.
13.2. Continued Operations. During any period of repair, Lessee shall continue, or
cause the continuation of, the operation of the Housing Development on the Site to the extent
reasonably practicable from the standpoint of prudent business management.
13.3 Damage or Destruction Due to Cause Not Required to be Covered by Insurance.
If the Housing Development is completely destroyed or substantially damaged by a casualty for
which Lessee is not required to (and has not) insured against, then City shall deliver written notice to
Lessee of its obligations under this Section 13.3 within thirty (30) days of such event of substantial
damage or destruction, and Lessee shall not be required to repair, replace, or restore such
improvements and may elect not to do so by providing City with written notice of election not to
repair, replace, or restore within ninety (90) days after such substantial damage or destruction. In
such event, Lessee shall remove all debris from the applicable portion of the Site. As used in this
Section 13.3, "substantial damage" caused by a casualty not required to be (and not) covered by
insurance shall mean damage or destruction which is fifteen percent (15%) or more of the
replacement cost of the improvements comprising the Housing Development. In the event that the
City delivers such notice to Lessee but Lessee does not timely elect not to repair, replace, or restore
the Housing Development as set forth in the first sentence of this Section 13.3, Lessee shall be
conclusively deemed to have waived its right not to repair, replace, or restore the Housing
Development and thereafter Lessee shall promptly commence and complete the repair, replacement,
or restoration of the damaged or destroyed Housing Development in accordance with Section 13.1
above and continue operation of the Housing Development during the period of repair (if practicable)
in accordance with Section 13.2 above. In the event Lessee elects not to repair, replace, or restore,
and gives City notice of such election as provided herein, this Lease shall terminate.
14. SALE, ASSIGNMENT, LEASE OR OTHER TRANSFER
Except as provided pursuant to Section 703 of the DDA, Lessee shall not sell, assign,
Lease, or otherwise transfer this Lease or any right therein, nor make any total or partial sale,
assignment, Lease, or transfer in any other mode or form of the whole or any part of the Site or
the Housing Development (each of which events is referred to in this Lease as an "Assignment"),
without prior written approval of City pursuant to Section 703 of the DDA. Any purported
assignment without the prior written consent of City, except for assignments permitted pursuant
1017953.5 11
to Section 703 of the DDA, shall render this Lease absolutely null and void and shall confer no
rights whatsoever upon any purported assignee or transferee. Lessee shall only assign, Lease, or
transfer the Site and the Housing Development as a whole and is not permitted to subdivide the
Site and the Housing Development for the duration of this Lease without the prior written
approval of City. Notwithstanding any provision in this Section 14 to the contrary, in no event
shall Lessee make any assignment which would or could be effective beyond the Tenn
(including extensions thereof) without the prior written consent of the City. City may assign or
transfer any of its rights or obligations under this Lease with the approval of the Lessee, which
approval shall not be unreasonably withheld.
15. FINANCING.
Lessee may, at any time and from time to time during the Term, upon prior written notice
to City and subject to the requirements of Sections 401 - 408 of the DDA, mortgage, pledge,
hypothecate or otherwise encumber in connection with project financing to a federally or state
chartered bank or savings and loan, a life insurance company, a mortgage company, a pension.
fund, investment trust or similar institutional lender or trustee as required in connection with
project financing (herein called "Lender"), by deed of trust or mortgage or other security
instrument, all of Lessee's right, title and interest pursuant to this Lease and the leasehold estate
hereby ("Project Loan"). Project Loans shall include the construction loan and permanent loan
approved by the City pursuant to Section 401 of the DDA, and the refinancing of the permanent
loan, provided that the principal amount of the refinancing does not exceed the then current
amount owed pursuant to the loan, and the interest rate and other terms and conditions of the
refinancing are at current market rates. The encumbrances securing the Project Loans, together
with refinancing of the Project Loans and any other loan or encumbrance approved by City
pursuant to the DDA and this Lease, shall be deemed to be "Permitted Encumbrances."
Notwithstanding anything in this Section 15 to the contrary, Lessee shall not, without the prior
written consent of City, which may be given or withheld in City's sole discretion, obtain any
Project Loan or other conveyance for financing secured by the Housing Development or this
Lease, the term of which Capital Project Loan or other conveyance for financing purposes
extends beyond the Term.
16. INDEMNITY.
Lessee shall defend, indemnify, assume all responsibility for, and hold City and its
officers, employees, agents, and representatives harmless from, all claims, demands, damages,
defense costs or liability of any kind or nature (including reasonable attorneys' fees and costs)
and for any damages to property or injuries to persons, including accidental death, which may be
caused by or arise out of the Lessee's performance or failure to perform its obligations pursuant
to this Lease, whether such activities or performance thereof be by the Lessee or by anyone
employed or contracted with by the Lessee and whether such damage shall accrue or be
discovered before or after termination of this Lease, or from any defect in the Site or the Housing
Development, or from any displacement of residents or liability for relocation assistance
pursuant to Government Code Section 7260, et seq., due to the acts of Lessee hereunder. Lessee
shall not be liable for property damage or bodily injury occasioned by the negligence of, willful
misconduct of, or breach of this Lease by City or its agents or employees.
1017953.5 12
17. INSURANCE.
17.1. Insurance to be Provided by Lessee. During the Term, Lessee, at its sole cost
and expense, shall itself take out and maintain, or cause to be taken out and maintained, the
following insurance coverage, in addition to any insurance which may be required pursuant to
the DDA:
(a) Maintain a policy or policies of all-risk property insurance. Such
insurance policy shall be maintained in an amount not less than one hundred percent (100%) of
the "Full Insurable Value" of the Housing Development, as defined herein in this Section 17.
(b) Maintain, in an amount not less than One Million Dollars ($1,000,000) per
occurrence with a Three Million Dollars ($3,000,000) aggregate, commercial general liability
policy including contractual liability. The required amount of insurance shall be subject to
increases as City may reasonably require from time to time, but not more frequently than every
twenty-four (24) months. In no event shall such increase or increases exceed the increase during
such period in the CPI.
(c) Maintain a comprehensive automobile liability policy in not less than the
amount of One Million Dollars ($1,000,000) combined single limit. The required amount of
insurance shall be subject to increases as City may reasonably require from time to time, but not
more frequently than every twenty-four (24) months. In no event shall such increase or increases
exceed the increase during such period in the CPI.
(d) Maintain worker's compensation insurance issued by a responsible carrier
authorized under the laws of the State of California to insure employers against liability for
compensation under the workers' compensation laws now in force in California, or any laws
hereafter enacted as an amendment or supplement thereto or in lieu thereof Such workers'
compensation insurance shall cover all persons employed by Lessee and/or Property Manager in
connection with the Site and the Housing Development and shall cover full liability for
compensation under any such act aforesaid, based upon death or bodily injury claims made by,
for on behalf of any person incurring or suffering injury or death in connection with the Site or
the Housing Development or the, operation thereof by Lessee or Property Manager.
(e) Maintain until the completion of construction of the Housing
Development a builder's risk policy covering damage or loss up to the value of labor and
materials.
(f) Maintain or caused to be maintained use and occupancy or business
interruption or rental income insurance against the perils of fire, lightning, vandalism, malicious
mischief, riot and civil commotion, and such other perils ordinarily included in extended
coverage fire insurance policies, in the amount that is reasonably acceptable to the Lessee and
City.
17.2. Definition of "Full Insurable Value." The term "Full Insurable Value" as used
in this Section 17 shall mean the actual replacement cost of the Housing Development, including
the cost of construction of the Housing Development, architectural and engineering fees,
10179515 13
applicable governmental fees, and inspection and supervision. Lessee shall maintain the
insurance policy required by Section 17.1(a) hereof at the current Full Insurable Value of the
Housing Development.
17.3. General Insurance Provisions. All policies of insurance provided for in this
Section 17, except for the workers' compensation insurance, shall name Lessee and any
subtenant as the insured and City and its officers, employees, agents, and representatives, as
additional insureds, as their respective interests may appear. Lessee agrees to timely pay or
cause to be timely paid all premiums for such insurance and, at its sole cost and expense, to
comply and secure compliance with all insurance requirements necessary for the maintenance of
such insurance. Lessee agrees to submit policies of all insurance required by this Section 17 of
this Lease, or certificates evidencing the existence thereof, to City on or before the effective date
of this Lease, indicating full coverage of the contractual liability imposed by this Lease. At least
thirty (30) days prior to expiration of any such policy, copies of renewal policies, or certificates
evidencing the existence thereof, shall be submitted to City. All policies shall be written by good
and solvent insurers qualified to do business in California and reasonably acceptable to the City
Director or designee. All policies or certificates of insurance shall also: (i) provide that such
policies shall not be cancelled or limited in any manner without at least thirty (30) days prior
written notice to City; and (ii) provide that such coverage is primary and not contributing with
any insurance as may be obtained by City and shall contain a waiver of subrogation for the
benefit of the City. Lessee agrees that provisions of this Section as to maintenance of insurance
shall not be construed as limiting in any way the extent to which Lessee may be held responsible
for the payment of damages to persons or property resulting from Lessee's activities, activities of
its sublessees or the activities of any other person or persons for which Lessee is otherwise
responsible
11.4. Failure to Maintain Insurance. If Lessee fails or refuses to procure or maintain
insurance as required by this Lease, City shall have the right, at City's election, and upon
ten (10) days prior notice to Lessee, to procure and maintain such insurance. The premiums paid
by City shall be treated as added Rent due from Lessee, to be paid on the first day of the month
following the date on which the premiums were paid. City shall give prompt notice of the
payment of such premiums, stating the amounts paid and the name of the insured(s).
17.5. Insurance Proceeds Resulting from Loss or Damage to Housing
Development. All proceeds of insurance with respect to loss or damage to the Housing
Development during the term of this Lease shall be payable, under the provisions of the policy of
insurance, to Lessee, and said proceeds shall constitute a trust fund to be used for the restoration,
repair and rebuilding of the Housing Development in accordance with plans and specifications
approved in writing by City. To the extent that such proceeds exceed the cost of such
restoration, repair or rebuilding, then such proceeds shall be used to repay any outstanding loans
secured by encumbrances upon the Site, and any remaining proceeds shall be apportioned
between Lessee and City as their interests may appear. Notwithstanding the foregoing, within
the period during which a Permitted Encumbrance is in effect, such proceeds shall be payable in
accordance with the Permitted Encumbrance documents.
In the event this Lease is terminated by mutual agreement of City and Lessee and the
Housing Development is not restored, repaired or rebuilt, the insurance proceeds shall be jointly
1017953.5 14
retained by City and Lessee and shall be applied first to any payments due under this Lease from
Lessee to City, second to restore the Site and Housing Development to their original condition
and to a neat and clean condition, third to repay any outstanding loans secured by encumbrances
upon the Site, and finally any excess shall be apportioned between Lessee and City as their
interests may appear, and Lessee shall have no further obligation hereunder to restore, repair or
rebuild the Housing Development. The value of each interest for the purpose of apportioning
excess proceeds under this Section 17.5 shall be the fair market value of such interests
immediately prior to the occurrence of the damage or destruction.
18. EMINENT DOMAIN.
In the event that the Site and/or the Housing Development or any part thereof shall be
taken for public purposes by condemnation as a result of any action or proceeding in eminent
domain, then, as between City and Lessee, the interests of City and Lessee in the award and the
effect of the taking upon this Lease shall be as follows:
(a) In the event of such taking of only a part of the Site, leaving the remainder
of the Site in such location and in such form, shape and size as to be used effectively and
practicably for the conduct thereon of the uses permitted hereunder, this Lease shall terminate
and end as to the portion of the Site so taken as of the date title to such portion vests in the
condemning authority, but shall continue in full force and effect as to the portion of the Site not
so taken and from and after such date the rental required by this Lease to be paid by Lessee to
City shall be reduced in the proportion which the number of square feet so taken bears to the
total number of square feet in the Site.
(b) In the event of taking of only a part of the Site, leaving the remainder of
the Site in such location, or in such form, shape or reduced size as to render the same not
effectively and practicably usable and economically feasible for the conduct thereon of the uses
permitted hereunder, as reasonably determined by the Lessee, this Lease and all right, title and
interest thereunder shall cease on the date title to the Site or the portion thereof so taken vests in
the condemning authority.
(c) In the event the entire Site is taken, this Lease and all of the right, title and
interest thereunder, shall cease on the date title to the Site so taken vests in the condemning
authority.
(d) In the event of taking of only Lessee's leasehold interest in the Site, this
Lease shall terminate.
(e) Promptly after a partial taking, at Lessee's expense and in the manner
specified in provisions of this Lease related to maintenance, repairs, alterations, Lessee shall
restore the Housing Development, to the extent possible and as permitted by law, and to the
extent of condemnation proceeds received by Lessee, so as to place them in a condition suitable
for the uses and purposes for which the Site was leased.
(f) In the event of any taking under subparagraphs (a), (b), (c) or (d)
hereinabove, that portion of any award of compensation attributable to the fair market value of
the Site or portion thereof taken, valued as subject to this Lease, shall belong to City. That
1017953.5 15
portion of any award attributable to the fair market value of Lessee's leasehold interest in the
Site and Improvements pursuant to this Lease, and any separate award made to Lessee for loss of
business or for the taking of Lessee's fixtures and improvements, shall belong to Lessee. This
Section 18 shall be Lessee's sole and exclusive remedy in the event of any taking. Lessee hereby
waives the benefits of California Code of Civil Procedure § 1265.130.
(g) In the event of a partial taking, where the Lease remains in effect and
Lessee is obligated to restore or repair the Housing Development, then Lessee shall be entitled to
any portion of the award attributable to severance damages to the remaining Housing
Development to the extent necessary to restore or repair the Housing Development and any
remaining severance damages shall be payable to City. Said award shall be used for the
restoration, repair or rebuilding of the Housing Development in accordance with plans and
specifications approved in writing by City to the extent necessary to restore or repair the Housing
Development and any remaining severance damages shall be payable to City. The value of each
interest for the purpose of apportionment under this Section shall be the fair market value of such
interests at the time of the taking.
(h) Notwithstanding the foregoing provisions of this Section, City may, in its
discretion and without affecting the validity and existence of this Lease, transfer City's interests
in the Site in lieu of condemnation to any authority entitled to exercise the power of eminent
domain. In the event of such transfer by City, Lessee (or mortgagee if a mortgage is then in
effect) and City shall retain whatever rights they may have to recover from said authority the fair
market value of their respective interests in the Housing Development taken by the authority.
(i) All valuations to be made pursuant to this Section 18 shall be made by
mutual agreement of City and Lessee.
19. OBLIGATION TO REFRAIN FROM DISCRIMINATION.
Lessee covenants by and for itself and any successors in interest that there shall be no
discrimination against or segregation of any person or group of persons on account of race, color,
creed, religion, sex, marital status, national origin or ancestry in the sale, lease, transfer, use,
occupancy, tenure or enjoyment of the Site, nor shall Lessee itself or any person claiming under
or through it establish or permit any such practice or practices of discrimination or segregation
with reference to the selection, location, number, use or occupancy of residents, lessees, or
vendees of the Site or any portion thereof. The foregoing covenants shall run with the land.
20. NONDISCRIMINATION IN EMPLOYMENT.
Lessee, for itself and its successors and assigns, agrees that during the operation of the
Housing Development provided for in this Lease, and during any work of repair or replacement,
Lessee shall not discriminate against any employee or applicant for employment because of race,
color, creed, religion, sex, marital status, physical or mental disability, sexual orientation,
ancestry or national origin, or on the basis of any other category or status not permitted by law.
1017953.5 16
21. COMPLIANCE WITH LAW.
Lessee agrees, at its sole cost and expense, to itself comply, and to use its best
commercially reasonable efforts to secure compliance by all contractors and subtenants of the
Site and Housing Development, with all the requirements now in force, or which may hereafter
be in force, of all municipal, county, state and federal authorities, pertaining to the Site and the
Housing Development, as well as operations conducted thereon, and to faithfully observe and
secure compliance by all contractors and subtenants of the Site and Housing Development with,
in the use of the Site and the Housing Development all applicable county and municipal
ordinances and state and federal statutes now in force or which may hereafter be in force, and to
pay before delinquency all taxes, assessments, and fees, if any, assessor levied upon Lessee or
the Site or the Housing Development, including the land and any buildings, structures, machines,
appliances or other improvements of any nature whatsoever, erected, installed or maintained by
Lessee or by reason of the business or other activities of Lessee upon or in connection with the
Site and the Housing Development. Lessee shall use good faith efforts to prevent residential
tenants from maintaining any nuisance or other unlawful conduct on or about the Property, and
shall take such actions as are reasonably required to abate any such violations by residential
tenants of the Site and Housing Development. The judgment of any court of competent
jurisdiction, or the admission of Lessee or any residential tenant or permittee in any action or
proceeding against them, or any of them, whether City be a party thereto or not, that Lessee,
residential tenant or permittee has violated any such ordinance or statute in the use of the Site or
the Housing Development shall be conclusive of that fact as between City and Lessee, or such
residential tenant or permittee.
22. ENTRY AND INSPECTION.
City reserves and shall have the right during reasonable business hours (except in cases of
emergency), upon forty-eight (48) hours prior written notice (except in cases of emergency) to
Lessee by the City Administrator or designee, to enter the Site and the Housing Development for
the purpose of viewing and ascertaining the condition of the same, or to protect its interests in the
Site and the Housing Development or to inspect the operations conducted thereon, subject to the
City's indemnification obligations as set forth in Section 16 hereof.
F*�Jc� 1 0011130 /A 1►1 All Q
In the event that the entry or inspection by City pursuant to Section 22 hereof discloses
that the Site or the Housing Development are not in a decent, safe, and sanitary condition, City
shall have the right, after thirty (30) days written notice to Lessee (except in case of emergency,
in which event no notice shall be necessary), to have any necessary maintenance work done for
and at the expense of Lessee and Lessee hereby agrees to pay promptly any and all costs incurred
by City in having such necessary maintenance work done in order to keep the Site and the
Housing Development in a decent, safe and sanitary condition, provided that the City delivers
such notice which is required hereunder. ,The rights reserved in this Section shall not create any
obligations on City or increase obligations elsewhere in this Lease imposed on City.
1017953.5 17
24. EVENTS OF DEFAULT AND REMEDIES.
24.1. Events of Default by Lessee. Subject to the force majeure provisions of Section
25.22 hereof, the occurrence of any one or more of the following shall constitute an event of
default hereunder:
(a) Lessee shall fail to construct the Housing Development in accordance with
the DDA and within the times set forth in the DDA, subject to force majeure delays as set forth
in Section 702 of the DDA, within thirty (30) days of notice from the City that such construction
has not been completed within the required time; or
(b) Lessee shall abandon or surrender the Site or the Housing Development;
or
(c) Lessee shall fail or refuse to pay, within thirty (30) days of notice from
City that the same is due, any installment of Rent or any other sum required by this Lease to be
paid by Lessee; or
(d) Lessee shall fail to materially perform any covenant or condition of this
Lease, other than as set forth in subparagraphs (a) or (b) above, and any such failure is not cured
within thirty (30) days following the service on Lessee of a written notice from City specifying
the failure complained of, or if it is not reasonably practicable to cure or remedy such failure
within such thirty (30) day period, then Lessee shall not be deemed to be in default if Lessee
shall commence such cure within such thirty (30) day period and thereafter diligently prosecute
such cure to completion; or
(e) Subject to any restrictions or limitations placed on City by applicable laws
governing bankruptcy, Lessee's (i) application for, consent to or suffering of the appointment of
a receiver, trustee or liquidator for all or for a substantial portion of its assets; (ii) making a
general assignment for the benefit of creditors; (iii) admitting in writing its inability to pay its
debts or its willingness to be adjudged a bankrupt; (iv) becoming unable to or failing to pay its
debts as they mature; (v) being adjudged a bankrupt; (vi) filing a voluntary petition or suffering
an involuntary petition under any bankruptcy, arrangement, reorganization or insolvency law
(unless in the case of an involuntary petition, the same is dismissed within ninety (90) days of
such filing); (vii) convening a meeting of its creditors or any class thereof for purposes of
effecting a moratorium, extension or composition of its debts; or (viii) suffering or permitting to
continue unstayed and in effect for ninety (90) consecutive days any attachment, levy, execution
or seizure of all or a portion of Lessee's assets or of Lessee's interest in this Lease.
Notwithstanding anything to the contrary contained in this Lease, prior to declaring any
default or taking any remedy permitted under this Lease or applicable law based upon an alleged
default, Lessee's limited partner (the "Tax Credit Partner") shall have a period of not less than
sixty (60) days to cure such alleged default; provided, however, if in order to cure such default
Tax Credit Partner reasonably believes that it must remove a general partner of Lessee, or all of
them, pursuant to that certain Lessee's limited partnership agreement, Tax Credit Partner shall so
notify City and so long as Tax Credit Partner is reasonably and diligently attempting to remove
the general partner or general partners, Tax Credit Partner shall have until the date sixty (60)
1017953.5 18
days after the effective date of the removal of the general partner or general partners to cure such
default but in no event more than one (1) year.
24.2. Remedies of City.
In the event of any such default as described in Section 24.1, City may, at its option:
(a) Correct or cause to be corrected said default and charge the costs thereof
(including costs incurred by City in enforcing this provision) to the account of Lessee, which
charge shall be due and payable within thirty (30) days after presentation by City of a statement
of all or part of said costs;
(b) Correct or cause to be corrected said default and pay the costs thereof
(including costs incurred by City in enforcing this provision) from the proceeds of any insurance;
(c) Exercise its right to maintain any and all actions at law or suits in equity to
compel Lessee to correct or cause to be corrected said default;
(d) Have a receiver appointed to take possession of Lessee's interest in the
Site and the Housing Development, with power in said receiver to administer Lessee's interest in
the Site and the Housing Development, to collect all funds available to Lessee in connection with
its operation and maintenance of the Site and the Housing Development; and to perform all other
consistent with Lessee's obligation under this Lease as the court deems proper; and
In the event that Lessee's default has not been cured within one hundred twenty
(120) days from the date of City's notice pursuant to Section 24.1, in addition to the foregoing
remedies City shall also be entitled to terminate this Lease and immediately regain possession of
the Site. Notwithstanding anything to the contrary in this Lease, in no event shall City have the
right to terminate this Lease as a result of the occurrence and continuance of an Event of Default
or otherwise until the expiration of the fifteen (15) year tax credit compliance period as described
in Section 42(i)(1) of the Internal Revenue Code of 1986, as amended, except with the consent of
the Lessee or the Tax Credit Partner.
24.3. Damages. Damages which City recovers in the event of default under this Lease
shall be those which are then available under applicable California case and statutory law to
lessors for leases in the State of California including, but not limited to, any accrued but unpaid
rent and the worth at the time of award of the amount by which the unpaid rent for the balance of
the term of this Lease after the date of award exceeds the amount of such rental loss for the same
period that Lessee proves could be reasonably avoided.
24.4. Rights and Remedies are Cumulative. The remedies provided by this
Section 24 are not exclusive and shall be cumulative to all other rights and remedies possessed
by City. The exercise by City of one or more such rights or remedies shall not preclude the
exercise by it, at the same or different times, of any other rights or remedies for the same default
or any other default by Lessee.
1017953.5 19
24.5. Rights of Lenders.
a. General Provisions. At all times during the Term, Lessee shall have the
right to mortgage, pledge, deed in trust, assign rents, issues and profits and/or collaterally (or
absolutely for purposes of security if required by any lender) assign its interest in this Lease, or
otherwise encumber this Lease, and/or the interest of Lessee hereunder, in whole or in part, and
any interests or rights appurtenant to this Lease, and to assign or pledge the same as security for
any debt (the holder of any such mortgage, pledge or other encumbrance, and the beneficiary of
any such deed of trust being hereafter referred to as "Mortgagee" and the mortgage, pledge, deed
of trust or other instrument hereafter referred to as "Mortgage"), upon and subject to each and all
of the following terms and conditions:
Any Mortgage is subject to the requirements of Section 15 hereof.
ii. All rights acquired by said Mortgagee shall be subject to each and
all of the covenants, conditions and restrictions set forth in this Lease, and to all rights of City
thereunder, none of which covenants, conditions and restrictions is or shall be waived by City by
reason of the giving of such Mortgage. if Lessee encumbers its leasehold estate by way of a
Mortgage as permitted herein, and if City is advised in writing of the name and address of the
Mortgagee, then this Lease shall not be terminated or canceled on account of any Event of
Default by Lessee in the performance of the terms, covenants or conditions hereof until City
shall have .complied with the provisions of this Lease as to the Mortgagee's rights to cure and to
obtain a new lease.
b. Consent of Mortgagee Required. No cancellation, surrender,
termination, or modification of this Lease shall be effective without the written consent of the
holder of any Mortgage.
C. Rights and Obligations of Leasehold Mortgagees. If Lessee or Lessee's
successors or assigns shall mortgage the leasehold interest herein demised, then, as long as any
such Mortgage shall remain unsatisfied of record, the following provisions shall apply:
I. No Cancellation. City will not cancel, accept a surrender of,
terminate or modify this Lease without the prior consent in writing of the Mortgagee.
ii. Notice of Defaults. City agrees to give Mortgagee immediate
notice of all defaults by Lessee under the Lease, and to simultaneously give to Mortgagee a
written copy of all notices and demands that City gives to Lessee. No notice or demand under
the Lease shall be effective until after notice is received by Mortgagee. Any notices of default
given by City under the Lease shall describe the default(s) with reasonable detail. Mortgagee
shall have the right to cure any breach or default within the time periods given below.
d. Mortgagee's Cure Rights.
i. Notice and Cure. After receipt by Lessee of a notice of default
under the Lease and the expiration of any applicable period of cure given to Lessee under the
Lease, City shall deliver an additional notice ("Mortgagee's Notice") to Mortgagee specifying the
default and stating that Lessee's period of cure has expired. Mortgagee shall thereupon have the
1017953.5 20
additional periods of time to cure any uncured default, as set forth below, without payment of
default charges, fees, late charges or interest that might otherwise be payable by Lessee. City
shall not terminate the Lease or exercise its other remedies under the Lease if:
A. Within sixty (60) days after Mortgagee's receipt of the
Mortgagee's Notice, Mortgagee (i) cures the default, or (ii) if the default reasonably requires
more than 180 days to cure, commences to cure said default and diligently prosecutes the same
to completion; or
B. Where the default cannot be cured by payment or
expenditure of money or without possession of the Property or otherwise, Mortgagee initiates
foreclosure or other appropriate proceedings within sixty (60) days after receipt of the
Mortgagee's Notice, cures all other defaults reasonably capable of cure, complies with all other
covenants and conditions of the Lease reasonably capable of compliance, and continues to pay
all rents, real property taxes and assessments, and insurance premiums to be paid by Lessee
under the Lease. Mortgagee shall then have sixty (60) days following the later to occur of (i) the
date of execution and delivery of a new lease of the Property (a "New Lease"), or (ii) the date on
which Mortgagee or its nominee is able to occupy the Property following eviction of or vacating
by Lessee under the Lease, to cure such default; provided, however, that if any such default, by
its nature, is such that it cannot practicably be cured within sixty (60) days, then Mortgagee shall
have such time as shall be reasonably necessary to cure the default provided that Mortgagee
commences such cure within such sixty (60) day period and thereafter diligently prosecutes the
cure to completion.
ii. City agrees to accept performance by Mortgagee of all cures,
conditions and covenants as though performed by Lessee, and agrees to permit Mortgagee access
to the Property to take all such actions as may be necessary or useful to perform any condition or
covenants of the Lease or to cure any default of Lessee. Mortgagee shall not be required to
perform any act which is not susceptible to performance by Mortgagee.
iii. If Mortgagee elects any of the above -mentioned options, then upon
Mortgagee's acquisition of the Lease by foreclosure, whether by power of sale or otherwise or by
deed or assignment in lieu of foreclosure, or if a receiver be appointed, the Lease shall continue
in full force and effect, provided that, if Mortgagee elects the option provided above, then upon
Mortgagee's acquisition of the Lease, Mortgagee shall cure all prior defaults of Lessee under the
Lease that are reasonably capable of being cured by Mortgagee within the time set forth in said
Section, and City shall treat Mortgagee as Lessee under the Lease. If Mortgagee commences an
action as set forth above, and thereafter Lessee cures such defaults (which cure City shall be
obligated to accept) and Mortgagee then terminates all proceedings under the option in said
Section, then the Lease shall remain in full force and effect between City and Lessee.
e. New Lease. In the event the Lease is terminated for any reason prior to
the end of the Lease Term, City shall enter into a new lease ("New Lease") with Mortgagee or
Mortgagee's nominee covering the Property, provided that Mortgagee (a) requests such New
Lease by written notice to City within thirty (30) days after written notice by City of termination
of the Lease, and (b) cures all prior defaults of Lessee that are reasonably capable of being cured
by Mortgagee. The New Lease shall be for the remainder of the Lease Term, effective at the
1017953.5 21
date of such termination, and shall only include all the rents and all the covenants, agreements,
conditions, provisions, restrictions and limitations contained in the Lease, except as otherwise
provided in the Lease. In connection with a New Lease, City shall assign to Mortgagee or its
nominee all of City's interest in all existing subleases of all or any part of the Property and all
attomment given by the sublessees. City shall not terminate or agree to terminate any sublease
or enter into any new lease or sublease for all or any portion of the Property without Mortgagee's
prior written consent, unless Mortgagee fails to deliver its request for a New Lease under this
Section. In connection with any such New Lease, City shall, by grant deed, convey to
Mortgagee or its nominee title to the Improvements, if any, which become vested in City as a
result of termination of the Lease. City shall allow to the Lessee under the New Lease a credit
equal to the net income derived by City from the Property during the period from the date of
termination of the Lease until the date of execution of the New Lease under this Section, against
rent due during such period.
f. Security Deposits. Mortgagee or any other purchaser at a foreclosure sale
of the Mortgage (or Mortgagee or its nominee if one of them enters into a New Lease with City)
shall succeed to all the interest of Lessee in any security or other deposits or other impound
payments paid by Lessee to City.
g. Permitted Delays. So long as Mortgagee is prevented by any process or
injunction issued by any court or by any statutory stay, or by reason of any action by any court
having jurisdiction of any bankruptcy or insolvency proceeding involving Lessee, from
commencing or prosecuting foreclosure or other appropriate proceedings in the nature thereof,
Mortgagee shall not be deemed for that reason to have failed to commence such proceedings or
to have failed to diligently prosecute such proceedings, provided that Mortgagee uses reasonable
efforts to contest and appeal the issuance or continuance of any such process, stay or injunction.
It. Defaults Deemed Cured. On transfer of the Lease at any foreclosure sale
under the Mortgage or by deed or assignment in lieu of foreclosure, or upon creation of a New
Lease, any or all of the following defaults relating to the prior owner of the Lease shall be
deemed cured:
i. Attachment, execution or other judicial levy upon this Lease or the
leasehold estate hereby created;
ii. Assignment of this Lease or the leasehold estate hereby created for
the direct or indirect benefit of creditors of any prior Lessee;
iii. Judicial appointment of a receiver or similar officer to take
possession of the Premises, this Lease or any property of any prior Lessee not located on the
Premises;
iv. Filing any petition by, for or against any prior Lessee (or any
affiliate) under any chapter of the federal Bankruptcy Act or any federal or state debtor relief
statute, as amended;
1017953.5 22
V. Any failure by any prior Lessee to make a disclosure of a
hazardous substance release as required by the California Health and Safety Code, this Lease or
otherwise;
vi. Any default under any provision restricting transfers of Lessee's
interest in this Lease;
vii. Any breach of any representation or warranty given by any prior
Lessee;
viii. Any other defaults personal to Lessee and/or not otherwise
reasonably curable by each Mortgagee.
Anything herein contained to the contrary notwithstanding, the provisions of this
Section shall inure only to the benefit of the holders of Mortgages. If the holders of more than
one such Mortgage shall make written requests upon City in accordance with this Lease, the new
lease (as provided for above) shall be entered into pursuant to the request of the holder whose
Mortgage shall be prior in lien thereto and thereupon the written requests for a new lease of each
holder of a Mortgage junior in lien shall be and be deemed to be void and of no force or effect.
City's Forbearance and Right to Cure Defaults on Leasehold
Mortgages.
i. Notice. City will give to Mortgagee a copy of each notice or other
communication with respect to any claim that a default exists or is about to exist from City to
Lessee hereunder at the time of giving such notice or communication to Lessee, and City will
give to Mortgagee a copy of each notice of any rejection of this Lease by any trustee in
bankruptcy of Lessee. City will not exercise any right, power or remedy with respect to any
Event of Default hereunder, and no notice to Lessee of any such Event of Default and no
termination of this Lease in connection therewith shall be effective, unless City has given to
Mortgagee written notice or a copy of its notice to Lessee of such Event of Default or any such
termination, as the case may be.
ii. Mortgagee's Transferees, Etc. In the event the leasehold estate
hereunder shall be acquired by foreclosure, trustee's sale or deed or assignment in lieu of
foreclosure of a Mortgage, the purchaser at such sale or the transferee by such assignment and its
successors as holders of the leasehold estate hereunder shall not be liable for any rent, if any, or
other obligations accruing after its or their subsequent sale or transfer of such leasehold estate
and such purchaser or transferee and its successors shall be entitled to transfer such estate or
interest without consent or approval of City; provided that, the purchaser or transferee or
successor as holder of the leasehold estate hereunder shall be liable for the payment of all rent, if
any, becoming due with respect to the period during which such purchaser, transferee or other
successor is the holder of the leasehold estate hereunder. This Section shall also apply to the
rights of a Mortgagee in connection with the entry into a new lease and to the appointment of a
receiver on behalf of a Mortgagee.
1017953.5 23
j. No Liability of Mortgagee for Prior Indemnified Acts. A Mortgagee
shall not be obligated to assume the liability of Lessee for any indemnities arising for a period
prior to Mortgagee's acquiring the right to possession of the Property under this Lease.
k. City Cooperation. City covenants and agrees that it will act and fully
cooperate with Lessee in connection with Lessee's right to grant leasehold mortgages as
hereinabove provided. At the request of Lessee or any proposed or existing Mortgagee, City
shall promptly execute and deliver (i) any documents or instruments reasonably requested to
evidence, acknowledge and/or perfect the rights of Mortgagees as herein provided, including,
without limitation, and deed(s) of trust encumbering City's fee title in the Property as security for
loans obtained by Lessee in connection with the Property; and (ii) an estoppel certificate
certifying the status of this Lease and Lessee's interest herein and such matters as are reasonably
requested by Lessee or such Mortgagees. Such estoppel certificate shall include, but not be
limited to, certification by City that (a) this Lease is unmodified and in full force and effect (or, if
modified, state the nature of such modification and certify that this Lease, as so modified, is in
full force and effect), (b) all rents currently due under the Lease have.been paid, (c) there are not,
to City's knowledge, any uncured Events of Default on the part of Lessee under the Lease or
facts, acts or omissions which with the giving of notice or passing of time, or both, would
constitute an Event of Default. Any such estoppel certificate may be conclusively relied upon by
any proposed or existing leasehold Mortgagee or assignee of Lessee's interest in this Lease.
1. Claims. City and Lessee shall deliver to Mortgagee notice of any
litigation or arbitration proceedings between the parties or involving the Property or the Lease.
Mortgagee shall have the right, at its option, to intervene and become a party to any such
proceedings. If Mortgagee elects not to intervene or become a party, City shall deliver to
Mortgagee prompt notice of and a copy of any award, decision or settlement agreement made in
connection with any such proceeding.
in. Further Amendments. City and Lessee shall reasonably consider
including in the Lease by suitable amendment from time to time any provision which may be
reasonably requested by any proposed Mortgagee for the purpose of implementing the mortgagee
protection provisions contained in this Lease and allowing that Mortgagee reasonable means to
protect or preserve the lien of its Mortgage upon the occurrence of a default under the terms of
the Lease. City and Lessee each agree to execute and deliver (and to acknowledge for recording
purposes, if necessary) any agreement required to effect any such amendment which they have
approved.
25. MISCELLANEOUS.
25.1 Governing Law. The laws of the State of California shall govern the
interpretation and enforcement of this Lease.
25.2 Legal Actions. In addition to any other rights or remedies, either party may
institute legal action to cure, correct or remedy any default, to recover damages for any default,
or to obtain any other remedy consistent with the purpose of this Lease. Such legal actions must
1017953.5 24
be instituted in the Superior Court of Los Angeles County, State of California.
25.3 Acceptance of Service of Process. In the event that any legal action is
commenced by Lessee against City, service of process on City shall be made by personal service
upon the City Clerk of City, or in such other manner as may be provided by law..
In the event that any legal action is commenced by City against Lessee, service of process
on Lessee shall be made by personal service upon Lessee or in such other manner as may be
provided by law, and shall be effective whether made within or without the State of California.
25.4 Attorneys' Fees and Court Costs. In the event that either City or Lessee shall
bring or commence an action to enforce the terms and conditions of this Lease or to obtain
damages against the other party arising from any default under or violation of this Lease; then
the prevailing party shall be entitled to and shall be paid reasonable attorneys' fees and court
costs therefor in addition to whatever other relief such prevailing party may be entitled.
25.5 Inspection of Books And Records. City shall have the right (at Lessee's office,
upon not less than forty-eight (48) hours' notice, and during normal business hours) to inspect
and make copies of the books and records of Lessee pertaining to the Site as pertinent to the
purposes of this Lease.
25.6 Interest. Any amount due City that is not paid when due shall bear interest from
the date such amount becomes due until it is paid. Interest shall be at a rate equal to the lesser of
(i) the discount rate established by the San Francisco office of the Federal Reserve Bank, plus
two percent (2%), on the first day of the month such amount becomes due, and (ii) the maximum
rate permitted by applicable law.
25.7 Notices. All notices, statements, demands, requests, consents, approvals,
authorizations, offers, agreements, appointments or designations hereunder by either party to the
other shall be in writing and shall be given either by (i) personal service, (ii) delivery by
reputable document delivery service such as Federal Express that provides a receipt showing
date and time of delivery, or (iii) mailing in the United States mail, certified or registered mail,
return receipt requested, postage prepaid, and addressed as follows:
To City: City of Vernon
4305 Santa Fe Avenue
Vernon, California 90058
Attention: City Administrator
Copy to: City Attorney
Copy to: City Director of Community Services and Water
To Lessee:
c/o Meta Housing Corporation
1640 A. Sepulveda Blvd., Suite 425
Los Angeles, CA 90025
Attention: John Huskey
1017953.5 25
With copy to: Bocarsly, Emden, Cowan, Esmail & Arndt, LLP
633 West Fifth Street, 70th Floor
Los Angeles, CA 90071
Attention: Nicole Deddens
or to such other address as either party shall later designate for such purposes by written notice to
the other party. City shall also give copies of such notices to any party in interest under a
Permitted Encumbrance which has requested such notice. Notices shall be deemed effective
upon personal delivery or within three (3) days after mailing thereof as provided above;
provided, however that refusal to accept delivery after reasonable attempts thereto shall
constitute receipt. Any notices attempted to be delivered to an address from which the receiving
party has moved without notice to the delivering party shall be effective on the third day after the
attempted delivery or deposit in the United States mail.
25.8 Time is of the Essence. Time is of the essence in the performance of the terns
and conditions of this Lease.
25.9 Non -Merger of Fee and Leasehold Estates. If both City's and Lessee's estates
in the Site or the Housing Development or both become vested in the same owner, this Lease
shall nevertheless not be destroyed by application of the doctrine of merger except at the express
election of City and Lessee's Mortgagee. The voluntary or other surrender of this Lease by
Lessee, or a mutual cancellation thereof, shall not work as a merger and shall, at the option of
City, terminate all or any existing tenant leases or subtenancies or may, at the option of City,
operate as an assignment to City of any or all such existing tenant leases or subtenancies.
25.10 Holding Over. The occupancy of the Site after the expiration of the Term of this
Lease shall be construed to be a tenancy from month to month, and all other terms and conditions
of this Lease shall continue in full force and effect.
25.11 Conflict of Interest. No member, official or employee of City shall have any
personal interest, direct or indirect, in this Lease nor shall any such member, official or employee
participate in any decision relating to the Lease which affects his personal interests or the
interests of any limited partnership, partnership or association in which he is directly or
indirectly interested. Lessee warrants that it has not paid or given, and will not pay or give, any
third party any money or other consideration for obtaining this Lease.
25.12 Non -Liability of City and City Officials and Employees. No member, official,
officer, employee, agent, or representative of City shall be personally liable to Lessee, or any
successor in interest, in the event of any default or breach by City or for any amount which may
become due to Lessee or successor or on any obligations under the terms of this Lease.
25.13 Relationship. The relationship between the parties hereto shall at all times be
deemed to be that of landlord and tenant. The parties do not intend nor shall this Lease be
deemed to create a partnership or joint venture. Lessee acknowledges and agrees that neither this
Lease nor any other agreement with City in its proprietary capacity as Lessee shall bind the City
in its regulatory capacity and that nothing contained herein is an agreement of the City as a
governmental body having regulatory jurisdiction of the Site to issue or grant to Lessee any
1017953.5 26
permit, including building, grading or other land use permits. Lessee shall be required to apply
for and obtain all permits including building, grading and other land use permits needed from the
City in its governmental regulatory capacity, and to comply with all laws, ordinances, rules and
regulations of City governing the construction, use and occupancy of the Housing Complex.
25.14 Waivers and Amendments. All waivers of the provisions of this Lease must be
in writing and signed by the appropriate authorities of City or Lessee. The waiver by City of any
breach of any term, covenant, or condition herein contained shall not be deemed to be a waiver
of such term, covenant or condition, or any subsequent breach of the same or any other term,
covenant or condition herein contained. The subsequent acceptance of rent hereunder by City
shall not be deemed to be a waiver of any preceding breach of Lessee of any term, covenant or
condition of this Lease, regardless of City's knowledge of such preceding breach at the time of
acceptance of such rent. Failure on the part of City to require or exact full and complete
compliance with any of the covenants or conditions of this Lease shall not be construed as in any
manner changing the terms hereof and shall not prevent City from enforcing any provision
hereof. All amendments hereto must be in writing and signed by the appropriate authorities of
City and Lessee. The Lessee's mortgagee permitted by this Lease shall not be bound by any
waiver or amendment to this Lease without Lessee's mortgagee giving its prior written consent.
25.15 Non -Merger with DDA. None of the terms, covenants or conditions agreed upon
in writing in the DDA and other instruments between the parties to this Lease with respect to
obligations to be performed, kept or observed by Lessee or City in respect to the Site or any part
thereof, shall be deemed to be merged with this Lease.
25.16 Entire Agreement; Duplicate Originals; Counterparts. This Lease sets forth
the entire understanding of the parties with respect to Lessee's ground lease of the Site. This
Lease is executed in three (3) duplicate originals and counterparts, each of which is deemed to be
an original. This Lease includes three exhibits, Exhibits A, B, and C.
25.17 Severability. If any provision of this Lease or the application thereof to any
person or circumstances shall be invalid or unenforceable to any extent, the remainder of this
Lease and the application of such provisions to other persons or circumstances shall not be
affected thereby and shall be enforceable to the greatest extent permitted by law.
25.18 Terminology. All personal pronouns used in this Lease, whether used in the
masculine, feminine, or neuter gender, shall include all other genders; the singular shall include
the plural, and vice versa. Titles of sections are for convenience only, and neither limit nor
amplify the provisions of the Lease itself. Except for terms expressly defined in this Lease, all
terms shall have the same meaning as set forth in the DDA.
25.19 Recordation. A short form memorandum of this Lease, in the form attached
hereto as Exhibit "C", shall be recorded at or within five (5) working days after the time the
Lease is executed.
25.20 Binding Effect. This Lease, and the terms, provisions, promises, covenants and
conditions hereof, shall be binding upon and shall inure to the benefit of the parties hereto and
their respective heirs, legal representatives, successors and assigns.
1017953.5 27
25.21 Estoppel Certificate. Each of the parties shall at any time and from time to time
upon not less than twenty (20) days' prior notice by the other, execute, acknowledge and deliver
to such other party a statement in writing certifying that this Lease is unmodified and is in full
force and effect (or if there shall have been modifications that this Lease is in full force and
effect as modified and stating the modifications), and the dates to which the rent has been paid,
and stating whether or not to the best knowledge of the signer of such certificate such other party
is in default in performing or observing any provision of this Lease, and, if in default, specifying
each such default of which the signer may have knowledge, and such other matters as such other
party may reasonably request, it being intended that any such statement delivered by Lessee may
be relied upon by City or any successor in interest to City or any prospective mortgagee or
encumbrancer thereof, and it being further intended that any such statement delivered by City
may be relied upon by any prospective assignee of Lessee's interest in this Lease or any
prospective mortgagee or encumbrancer thereof. Reliance on any such certificate may not
extend to any default as to which the signer of the certificate shall have had no actual knowledge.
25.22 Force Majeure. In addition to specific provisions of this Lease, performance by
either party hereunder shall not be deemed to be in Default, and all performance and other dates
specified in this Lease shall be extended, where delays or Defaults are due to causes beyond the
control or without the fault of the party claiming an extension of time to perform, which may
include the following: war; insurrection; strikes; lockouts; riots; floods; earthquakes; fires;
casualties; acts of God; acts of the public enemy; epidemics; quarantine restrictions; freight
embargoes; lack of transportation; governmental restrictions or priority; unusually severe
weather; acts or omissions of the other party; or acts or failures to act of the City or any other
public or governmental agency or entity (other than the acts or failures to act of City which shall
not excuse performance by City). Notwithstanding anything to the contrary in this Lease, an
extension of time for any such cause shall be for the period of the enforced delay and shall
commence to run from the time of the commencement of the cause, if notice by the party
claiming such extension is sent to the other party within thirty (30) days of the commencement of
the cause. Times of performance under this Lease may also be extended in writing by the mutual
agreement of City and Lessee.
25.23 Quiet Enjoyment. City does hereby covenant, promise and agree to and with
Lessee that Lessee, for so long as Lessee is not in default hereof, shall and may at all times
peaceably and quietly have, hold, use, occupy and possess the Site throughout the Term.
25.24 City Approvals and Actions. Whenever a reference is made herein to an action
or approval to be undertaken by City, the City Administrator or his or her designee is authorized
to act on behalf of City unless specifically provided otherwise or the law otherwise requires.
1017953.5 28
IN WITNESS WHEREOF, the parties hereto have caused this Lease to be executed by
their lawfully authorized officers.
ATTEST:
City Clerk
APPROVED AS TO FORM:
Nicholas George Rodriguez,
City Attorney
Kronick Moskovitz Tiedemann & Girard,
Special Counsel to City
CITY:
CITY OF VERNON, a California charter city and
municipal corporation
Un
LESSEE:
[META HOUSING CORPORATION LIMITED
PARTNERSHIP]
LE
1017953.5 29
EXHIBIT A
SITE MAP
[To be provided]
1017953.5 A-1
EXHIBIT B
SITE DESCRIPTION
That real property located in the City of Vernon, County of Los Angeles, State of California,
described as follows:
Lot Nos. 45 through 53 of Tract No. 7923
APN: 6314-002-900(portion)
B-1
1017953.5
EXHIBIT C
RECORDING REQUESTED BY )
AND WHEN RECORDED MAIL TO: )
City of Vernon )
4305 Santa Fe Avenue )
Vernon, California 90058 )
Attention: City Clerk )
Exempt rrom xecoromg Fee Pursuant to
Government Code Sections 6103 and 27383
MEMORANDUM OF LEASE
THIS MEMORANDUM OF LEASE ("Memorandum") is hereby entered into as of
201_by and between the CITY OF VERNON, a charter city and
municipal corporation (the "City'), and [META HOUSING CORPORATION ENTITY] (the
"Lessee").
RECITALS
A. City and Lessee have entered into a "Ground Lease" dated concurrently herewith
for that certain parcel of real property which is legally described in Exhibit A attached hereto and
incorporated herein by reference (the "Site"). A copy of the Ground Lease is available for public
inspection at City's office at 4305 Santa Fe Avenue, Vernon, California. The term of the Ground
Lease is sixty-five (65) years with one ten (10) year extension option.
B. The Ground Lease provides that a short form memorandum of the Ground Lease
shall be executed and recorded in the Official Records of Los Angeles County, California.
NOW, THEREFORE, the parties hereto certify as follows:
City, pursuant to the Ground Lease, hereby Leases the Site to the Lessee upon the terms
and conditions provided for therein. This Memorandum of Lease is not a complete summary of
the Ground Lease, and shall not be used to interpret the provisions of the Ground Lease.
C-1
1017953.5
CITY:
CITY OF VERNON, a California charter city and
municipal corporation
ATTEST:
City Clerk
APPROVED AS TO FORM:
Nicholas George Rodriguez,
City Attorney
Kronick Moskovitz Tiedemann & Girard,
Special Counsel to City
LESSEE:
[META HOUSING CORPORATION ENTITY]
LE
M
C-2
1017953.5
EXHIBIT A TO MEMORANDUM OF LEASE
LEGAL DESCRIPTION
That real property located in the City of Vernon, County of Los Angeles, State of California,
described as follows:
Lot Nos. 45 through 53 of Tract No. 7923
APN: 6314-002-900(portion)
Exhibit A to Memorandum of Lease
1017953.5
STATE OF CALIFORNIA )
ss
COUNTY OF )
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.
(Seal)
Notary Public
Exhibit A to Memorandum of Lease
1017953.5
STATE OF CALIFORNIA
ss
COUNTY OF
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.
(Seal)
Notary Public
Exhibit A to Memorandum of Lease
1017953.5
ATTACHMENT NO.4
LIST OF ENVIRONMENTAL STUDIES AND REPORTS
[To be inserted]
Attachment No. 4-1
1017942.5
COMMUNITY SERVICES & WATER DEPARTMENT
Samuel Kevin Wilson, Director of Community Services & Water
4305 Santa Fe Avenue, Vernon, California 90058
Telephone (323)583-8811 Fax (323)826-1435
November 27, 2012
Christopher Maffris, VP
Meta Housing Corporation
1640 Sepulveda Blvd. Suite 425
Los Angeles Ca 90025
Dear Mr. Matrris:
V-6
Via Pick-up
Enclosed herewith are the following due diligence documents pertaining to the City -owned
Property located at 5119-5309 District Boulevard. The proposed 52nd Drive housing development
will be constructed on a portion of the subject property:
• Tank Removal Geologic Report dated March 25, 2008
• Site Assessment Geologic Report dated March 26, 2008
• Excavation and Testing Report dated March 27, 2008
• Daily Report of Observation & Testing prepared by David H. Lee & Associates dated
January 21, 2008
• Report of Geotechnical Observation and Testing of Excavation Backfill Operations prepared
by NorCal Engineering dated July 8, 2008
• Human Health Risk Assessment dated July 24, 2008
• Soil and Hazardous Waste Remediation Report dated September 4, 2008
• Soil Excavation Remediation Report dated September 8, 2008
• Supplemental Site Assessment Geologic Report dated October 6, 2008
• Proposal from Aqua Science Engineers, Inc. for Soil Vapor Extraction Remediation dated
November 11, 2008
• Proposal from Wayne Perry, Inc. for Remediation Services dated November 17, 2008
• Proposals from Atlas Environmental Engineering, Inc. for the Remediation of Contaminated
Soil dated November 17, 2008 and revised December 4, 2008
• Agreement between the City of Vernon and United Site Services, Inc. for rental and
maintenance of fencing with a commencement date of December 19, 2009.
• Change Order No. 1 to Agreement between City and United Site Services, Inc. to replace
fencing at 5119 District Boulevard dated June 15, 2010.
Er,cfusive(y Iudustrid
• Change Order No. 2 extending the Rental and Maintenance Agreement between the City and
United Site Services, Inc. for rental and maintenance services for fencing at 5119 and 5201
District Boulevard for the period of December 28, 2010 through December 28, 2011 dated
December 20, 2010.
• Drawing and photos of concrete structures left in place.
• Letter prepared by PIC Environmental Services regarding Proposed Fire Station dated April
9, 2008
• Site Health and Safety Plan report prepared by PIC Environmental Services dated March 7,
2008
• Analytical Results prepared by Cal Tech Environmental Laboratories dates ranging from
March 5, 2008 to June 24, 2008
• Thermador Site Remediation packet
• Thermador/Waste King Division NI
• Thermador/Waste King Division NI (1987-1992)
• Thermador/Waste King Division NI (1993-?)
• Thermador/Waste King Division NI (588-6131)
• Masco Corporation File
• BSH Home Appliances January 2000- Present
• Industrial Wastewater Flow Measurement Requirements prepared by County Sanitation Districts
of Los Angeles County dated May 14, 1984
• Letter Report summarizing results of limited soil testing efforts prepared by MeredithBoli &
Associates, Inc. dated June 1, 1990
• Letter Report summarizing results of the expanded soil testing efforts prepared by Meredith/Boli
& Associates dated August 2, 1990
• Soil Testing Results prepared by MeredithBoli & Associates, Inc. dated April 2, 1991
• Letter from Thermador to the City of Vernon dated June 4, 1991
• Soil Test Results and Proposed Corrective Actions prepared by MeredithBoli & Associates, Inc.
dated August 19, 1991
• Soil Vapor Extraction Test prepared by MeredithBoli & Associates, Inc. dated September 29,
1992
• Hazardous Materials Establishment Reporting Form Business/Contingency Plan received March
28, 1994 - IV
• Hazardous Materials Establishment Reporting Form Business/Contingency Plan received March
28, 1994 — V
• Facility Diagram of Four Major Buildings received March 28, 1994
• Peer Review of Proposed Soil Vapor Extraction System prepared by Geomatrix Consultants, Inc.
dated January 30, 1995
• Hazardous Materials Control Program Official Inspection Report dated May 30, 1995
• Letter from Thermador to Environmental Health Specialist dated June 12, 1995 regarding
inspection report
• Letter from Thermador to Environmental Health Specialist dated June 16, 1995 regarding Peer
Review
• Proposal for Soil Remediation prepared by Montgomery Watson dated August 4, 1995
• Revised Proposal for Soil Remediation by Montgomery Watson dated May 21, 1996
• Revised Proposal for Soil Remediation and Projected Costs Table transmittal from Montgomery
Watson dated August 26, 1996
• Draft Catalytic Oxidizer Technical Evaluation prepared by Montgomery Watson dated December
16, 1996
• Hazardous Materials Establishment Report Form for Reporting Period January 1 to December 31,
1997 dated June 30, 1997
• Montgomery Watson transmittal of Remedial Action Plan dated January 20, 1997 (no
attachment)
• Comments and Questions on Thermador RAP prepared by Montgomery Watson dated January
23, 1997
• Remedial Action Plan dated February 20, 1997
• Letter to Montgomery Watson regarding Remedial Action Plan prepared by the Environmental
Health Department dated April 8, 1997
• Hazardous Materials Inventory Repots prepared by Mr. H. Martinez dated June 30, 1997
• Clarifier Sampling Results fax prepared by Montgomery Watson dated July 15, 1997
• City of Vernon Plumbing Permit Number 70586 dated July 24, 1997
• Clarifier Closure Report prepared by Montgomery Watson dated September 5, 1997
• Letter to Montgomery Watson regarding Clarifier Closure Report prepared by the Environmental
Health Department dated September 18, 1997
• Hazardous Materials Establishment Report Form for Reporting Period January 1 to December 31,
1998 dated June 25, 1998
• Industrial Wastewater Discharge Permit No. 15008 prepared by County Sanitation Districts of
Los Angeles County dated January 20, 1999
• Sewerage System Connection Fee report prepared by County Sanitation Districts of Los Angeles
County dated January 20, 1999
e Remedial Action Plan Comments prepared by Montgomery Watson dated January 27, 1999
• Geophysical Survey Results prepared by Geomatrix Consultants, Inc. dated February 10, 1999
• Unified Hazardous Materials Program Permit Renewal by City of Vernon dated June 10, 1999
• Second Quarter 1999 Progress Report for Soil Vapor Extraction Remediation System Operations
prepared by Montgomery Watson dated August 12, 1999
• Unified Hazardous Materials Control Program Official Inspection Report dated September 27,
1999
• Analytical Report for Masco/Thermador Lot #M9I280218 prepared by Quanterra Incorporated
dated October 13, 1999
• Analytical Results prepared by Quanterra Incorporated dated October 19, 1999
• Third Quarter 1999 Progress Report for Soil Vapor Extraction Remediation System Operations
prepared by Montgomery Watson dated November 2, 1999
• Letter prepared by Thermador to Vendor dated December 14, 1999
• Fourth Quarter 1999 Progress Report for Soil Vapor Extraction Remediation System Operations
prepared by Montgomery Watson dated January 27, 2000'
• Del Mar Analytical Report UCO524 dated April 3, 2000
• Analytical Report for Masco/Thermador Lot #MOD250140 prepared by Severn Trent
Laboratories dated May 4, 2000
• First Quarter 2000 Progress Report for Soil Vapor Extraction Remediation System Operations
prepared by Montgomery Watson dated May 8, 2000
• Analytical Report for Masco/Thermador Lot #MOE120181 prepared by Severn Trent
Laboratories dated May 22, 2000
• Del Mar Analytical Report IJEO349 dated May 30, 2000
• Unified Hazardous Materials Program Permit Renewal prepared by City of Vernon dated June 1,
2000
• Lab Reports that comprise the Acceptance Testing transmitted by Montgomery Watson dated
July 19, 2000
• Second Quarter 2000 Progress Report for Soil Vapor Extraction Remediation System Operations
prepared by Montgomery Watson dated September 7, 2000
• Proposal for Soil Closure prepared by Montgomery Watson dated November 15, 2000
• Third and Fourth Quarter 2000 Progress Report for Soil Vapor Extraction Remediation System
Operations prepared by Montgomery Watson dated December 27, 2000 (2)
• Post Remediation Closure Report prepared by GeoSyntec Consultants, Inc. dated September 19,
2001(2)
• Closure for Thermador/Masco Remediation letter prepared by the Environmental Health
Department dated February 20, 2002
• Decommissioning Notification Letters transmittal prepared by GeoSyntec Consultants dated
March 14, 2002
• Maywood Mutual; Water Company No. 3 Work Order dated June 10, 2002
• E-mail to Marilyn Glantz dated June 12, 2002
• E-mail to Marilyn Glantz regarding Thermador Utility Closure Work Plan dated June 18, 2002
•. Soil Vapor Extraction and Treatment System Decommissioning Status Report and Work Plan for
Utility Closures and Pavement Repair Activities prepared by GeoSyntec Consultants dated June
19, 2002 (2)
• Letter from USEPA to Thermador B S H Home Appliances dated June 25, 2002
• Analytical Data Supporting Compliance with I WD Permit No. 15008 transmitted to
Environmental Health Department dated July 26, 2002
• Fax from Environmental Health Department to GeoSyntec dated August 8, 2002
• Uniform Hazardous Waste Manifest Document Number 21892088 and Certificate of
Treatment/Recycling dated August 26, 2002
• Phase I Environmental Site Assessment prepared by The Conservtech Group dated June 2004
• Letter to BSH Home Appliances prepared by the Environmental Health Department dated
August 2, 2004 regarding Phase 11 Report — attachment Phase II Subsurface Soils Investigation
prepared by The Conservtech Group dated June 2004
• E-mail to John Cullen dated October 21, 2004 regarding Vernon Plant Closure
• Addendum to standard offer dated October 19, 2004
• Letter from PIC Environmental with bid schedule for Phase I and Phase II Environmental
Assessments dated November 23, 2004
• Memo to Environmental Health Department regarding the three proposals for a Phase I and
Phase II environmental assessment dated November 30, 2004
• Supplemental Phase II Environmental Site Assessment Summary of Observations Memorandum
prepared by GeoSyntec Consultants dated December 17, 2004
• E-mail to Lew Pozzebon from Sandra Slon regarding contact information for due diligence
purposes dated January 4, 2005
• Report on Supplemental Phase II Investigation prepared by The Conservtech Group dated
January 10, 2005
• Letter to Troy & Gould prepared by Masco Corporation dated February 8, 2005 transmitting
Initial Due Diligence Reports
• Additional Soil Sampling Activities prepared by GeoSyntec Consultants, Inc. dated April 20,
2005
• Work Plan for Additional Soil Sampling Activities prepared by GeoSyntec Consultants dated
May 27, 2005
• Report on Additional Soil Sampling Activities prepared by GeoSyntec Consultants dated June
17, 2005
• Letter to Troy & Gould prepared by Masco Corporation dated June 23, 2005 transmitting an
Additional Due Diligence Report and an updated list of documents sent to date
• Request for No Further Action Determination prepared by GeoSyntec Consultants dated July 12,
2005
• Certificate of Closure prepared by the Environmental Health Department dated July 25, 2005 to
BSH Home Appliances
• Fax Cover and Letter from PIC Environmental Services to Kevin Wilson dated July 27, 2005
• Letter from PIC Environmental Services to Kevin Wilson regarding subject site dated August 3,
2005
• Letter from PIC Environmental Services to Kevin Wilson regarding supplemental dated
September 14, 2005
• Letter regarding PIC Environmental Services contracted to conduct Phase I and II Environmental
Investigation dated September 7, 2005
• Letter regarding PIC Environmental Services contracted to conduct Phase I and II Environmental
Investigation dated September 29, 2005
• Phase I and Phase Il Environmental Site Assessment Report prepared by PIC Environmental
Services dated October 19, 2005
• Information on Environmental Condition of 5119 — 5309 District Boulevard and 4501— 4727
52nd Drive, Memo prepared by Environmental Health Department dated October 24, 2005
• City of Vernon Demolition Permit Number 000-082-419 dated September 7, 2006
• City of Vernon Industrial — Remodel Permit Number B00-082-494 dated October 3, 2006
• City of Vernon Miscellaneous Permit Number BOO-082.524 dated October 12, 2006
• City of Vernon Miscellaneous Permit Number BOO-082-525 dated October 12, 2006
• Uniform Hazardous Waste Manifest Tracking Number 00017231 l JJK dated November 3, 2006
• Research of environmental records concerning Service Oil Co. property prepared by PIC
Environmental Services dated November 6, 2007
• Human Health Risk Assessment prepared by Environmental Health Decisions with Staffs notes
dated July 2009
• E-mail to Lissette Melendez from Lyndon Ong Yiu regarding Waste Disposal and Diversion
Report dated December 8, 2008
• Human Health Risk Assessment prepared by Environmental Health Decisions dated August 2009
• City of Maywood water quality assessment dated December 15, 2010
• Letter address to Neil Mishurda for Proposed scope of work for the District Blvd. Acquisition
dated June 1, 2011
• Letter to Health Department regarding remediation proposal prepared by PIC Environmental
Services dated July 18, 2011
• Letter to Health Department regarding remedial action plan prepared by PIC Environmental
Services dated July 18, 2011
• Letter address to Neil Mishurda for Proposed scope of work for the District Blvd. Acquisition
dated September 9, 2011
• Draft Phase I and Phase lI Environmental Site Assessment Report prepared by HMC dated
September 19, 2011
• Addendum to the Work Plan dated September 29, 2011 to complete additional subsurface
investigations prepared by HMC dated October 5, 2011
• Data Presentation prepared by HMC dated October 20, 2011
• Email from PIC Environmental to Lewis Pozzebon regarding the review of the HMC preliminary
report dated October 20, 2011
• PIC Bid Schedule dated December 21, 2011
• Email from Leonard Grossberg regarding the review of PIC Bid for remediation of site dated
February 2, 2012
• Letter to Health Department regarding remediation proposal prepared by PIC Environmental
Services dated February 14, 2012
• Remedial Action Plan prepared by PIC Environmental Services dated May 17, 2012
• Letter Response Comments on the Remedial Action Plan addressed to PIC Environmental
Services dated July 12, 2012
• Letter regarding the request to conduct addition evaluation of potential environmental hazards at
the southeast portion of the referenced property prepared by PIC Environmental Services dated
October 5, 2012
• Letter regarding the request to conduct addition evaluation of potential environmental hazards at
the southeast portion of the referenced property prepared by PIC Environmental Services dated
October 19, 2012
• Staff Report from Environmental Health requesting to appropriate remediation funds for site
cleanup dated November 21, 2012
The City also has on file in its Building Department permit file records and construction
drawings for buildings that were previously constructed on site along with demolition records. These
records may be reviewed in the Community Services Department.
If you need further information, please contact me. Thank you.
Wilson, P.E.
mmunity Services & Water
SKW
Enclosures
Buyer's signature below represents Buyer's receipt of the Due Diligence Materials listed on this
document for the above -referenced property
Buyer Entity:
By: —
Print Name:
Title:
Date:
ATTACHMENT NO.5
SCOPE OF DEVELOPMENT
Vernon Family Apartments is a 45-unit affordable housing development located on a 2.06 acre
site at 4675 52nd Drive. A mix of 9 1-bedroom, 22 2-bedroom, and 14 3-bedroom flats will be
spread throughout five newly constructed two-story buildings within the site. New construction
will also include 74 on -grade parking spaces, a community room with community kitchen,
computer room, property management office, police substation facility, meeting room, common
laundry facility, a courtyard and barbecue area, tot lot, and community gardens. The project will
be constructed to meet LEED Silver certification standards.
Meta Housing Corporation has been working closely with the City of Vernon on the design of
the project, submitting conceptual plans. Although the City of Vernon is still working with Meta
Housing Corporation on some refinements to the building, the conceptual plans (attached)
largely reflect their recommendations and have received approval. The final construction
drawings shall be consistent with these plans.
PROPERTY DEVELOPMENTSTANDARDS
The following property development standards and the CEQA Mitigation Measures as defined in
the Mitigated Monitoring Reporting Program shall apply to the Project. The satisfaction of the
property development standards shall be determined solely by the City of Vernon and is subject
to City of Vernon approval. In no case is the Developer relieved of the requirements of any
laws, codes or administrative regulations of the State of California or the County of Los Angeles.
1. Interior and Exterior Building Materials and Finishes: The building shall incorporate
quality materials and details. Interior unit finishes shall include granite countertops, wood
cabinets, panel doors, 5" baseboards, and 3" casing around entrance doors. Maximum use of
recycled content materials, sustainably produced materials, pre -coated building materials and
non-VOC architectural coatings, as well as durability and minimal maintenance shall be key
determinants in selecting all building materials and systems. Exterior roof shall be clay or
concrete tiles, or substitute approved by the City of Vernon, and any membrane materials
shall meet energy code and green building program requirements for a cool roof. Stone
veneers, or a substitute approved by the City of Vernon, shall be used to highlight
architectural features of the structures.
2. Mechanical and Telecommunications Equipment and Rooftop Structures Design and
Screening: All mechanical and telecommunications equipment shall be enclosed within the
building, concealed from view or incorporated and treated as architectural features. All
mechanical and telecommunications equipment, rooftop features, roof surfaces and other
necessary elements shall be attractively designed and arranged in a sensitive and orderly
manner. All equipment and non -architectural elements shall be painted to match the roof or
background color. Rooftop screening shall be incorporated into roof designs to block views
from the pedestrian level and from adjacent buildings to the greatest extent feasible. All
equipment shall serve exclusively the needs of tenants located in the Project and shall be
Attachment No. 5-1
1017942.5
removed when no longer required for service. Telecommunications equipment, intended for
general public use, such as cellular telephone antennae and equipment, shall not be permitted.
3. Illumination: All illumination shall be designed to minimize glare, control valent light
spillover, and provide ambient and safety lighting along the street frontage, publicly
accessible open areas, the courtyard and parking facilities with particular attention paid to
pedestrian and vehicular entrances. All illumination shall be energy efficient.
4. Pedestrian Circulation: Pedestrian circulation in front of the development shall be
designed to encourage a pedestrian -friendly environment. Attractively designed walkways,
enhanced paving materials, landscaping, lighting, decorative and informational graphics and
other pedestrian amenities shall reinforce the pedestrian -friendly nature of the Project while
integrating it into the existing street pedestrian infrastructure and community.
5. Landscaping, Water Conservation and Surface/Storm Water Management: All outdoor
spaces and common areas, including dedication areas, setback areas, courtyards, gardens and
shall be attractively landscaped with a variety of treatments, furnishings and lighting and
finished in high quality materials. Landscaping and irrigation shall be designed to be
aesthetically attractive, durable, low maintenance and water conserving and to maximize site
retention of surface and stone water run-off. Any surface/storm water discharge from the
site shall be treated as needed on -site prior to discharge to avoid downstream pollution.
Storm water discharge shall be in compliance with the LID requirements of the LA County
ms4 permit issued by the Los Angeles Regional Water Quality Control Board.
The landscaping and irrigation plans shall incorporate drought -resistant plant materials along
with water -saving drip/buried-tube irrigation and state-of-the-art water management control
systems. Large grass/turf areas and high water usage plants shall be avoided. Landscaping,
lighting and furnishings shall include, but not be limited to, street trees, on -site trees and
other plant materials, sidewalk, walkway and plaza treatments, street and pedestrian lighting,
seating, decorative and information graphics. The landscape/hardscape design shall be
coordinated with and shall be compatible in design and consistent in quality with completed
and planned public improvements and streetscape programs in the area.
6. Vehicular Access, Circulation and Parking: The Project shall be designed to provide safe
and efficient vehicular access, circulation and parking for residents, visitors and employees.
Careful separation of pedestrian and automobile circulation zones shall be incorporated into
the site design. Vehicle entrance and exit patterns shall be designed to minimize conflicts
with pedestrian circulation. Delineation of pedestrian and auto interface zones shall be
provided. Parking shall be provided as required by the City of Vernon and shall be located
off-street.. Parking shall be well lit, using energy efficient lighting as well as natural light and
ventilation where possible, with extensive internal directional signage and graphics to
provide ease of access, identification of each parked vehicle location, and way -finding to
pedestrian entrances and exits.
7. Driveways and Vehicular Ramps: Driveway locations shall not conflict with traffic
movements in the streets. All vehicular entries into the Project shall be given careful design
Attachment No. 5-1
1017942.5
consideration and treated to minimize their visual impact. Driveway design and location
shall be subject to City approval. Vehicular ramps shall be designed to minimize any barrier
effects to pedestrian movement.
8. Signage: A coordinated Signage Plan for all exterior identification, information and
directional signage shall be prepared by the Developer for the Project. The Signage Plan,
which shall include the location, size, color, lighting, materials and design of all signs and
logos, shall be compatible with the Project and the surrounding neighborhoods. Signage
shall occupy appropriate fields and constitute an integral component of building design and
surfaces. A building monument sign shall be installed at the western most parking entrance.
The Signage Plan shall be subject to approval concurrently with the building design.
9. Security: The design and operational management of the Project shall be responsive to the
security needs of residents, visitors, employees and the general public. All such areas shall
be designed, including lighting design, in such a manner as to lend themselves to continual
visual surveillance to discourage nuisance activities and conduct. The building and parking
shall incorporate appropriate security technology for access control. Any exterior security
devices, such as surveillance cameras, shall be integral to and compatible with the design of
the Project. The Project shall incorporate exterior lighting which reinforces entrances,
provides a safe level of illumination and is compatible with the design of the buildings. The
site shall be secured with 6' masonry walls on the North, West, and East property lines. The
South property line shall be secured with a wrought iron fence to allow visibility from 52nd
Drive.
10. Utilities: All on -site and off -site utilities, including data tamer infrastructure, utility
connections and related equipment shall be concealed within the building or screened from
view, to the extent feasible.
11. Energy Conservation: The Developer shall to the greatest extent feasible, taking into
account estimated initial costs, operational savings and incentive program benefits, minimize
the energy required to operate the Project over its lifetime and to incorporate "smart
building" technology and alternative energy sources. Such energy efficiency shall be
accomplished through innovative and state-of-the-art concepts in design and construction.
The Developer shall strictly observe and incorporate all energy conservation
recommendations and mandated codes such as California Title 24 and shall seek to exceed
such statutory and regulatory requirements to the extent feasible. Insulation opportunities,
solar shading and solar energy design, building placement and orientation, energy -efficient
building cooling, heating, ventilating and lighting strategies and technologies and other
energy conservation measures should be considered in the design and is a key component in
meeting LEED Silver certification standards. The Project shall be in compliance with the
California Green Code.
12. Waste Reduction/Recycling: A Waste Reduction and Recycling Program Plan shall be
prepared by the Developer and implemented for the design, demolition and construction
stages of the Project and for the management and operation of all occupancies. Facilities
shall be provided to accommodate the physical requirements for these identified programs.
Attachment No. 5-1
1017942.5
13. Density: The residential unit density shall not exceed 45 units.
14. Land Use: The Project shall consist of 45 units of affordable housing development. A mix
of 9 1-bedroom, 22 2-bedroom, and 14 3-bedroom flats will be spread throughout five newly
constructed two-story buildings within the site. New construction will also include 74 on -
grade parking spaces, a community room with community kitchen, computer room, property
management office, meeting room, common laundry facility, a courtyard and barbecue area,
tot lot, and community gardens. The project will be constructed to meet LEED Silver
certification standards.
15. Height and Massing: The Project shall not exceed 30 feet in height and shall be articulated
through the use of architectural detailing; finish materials, textures and colors; varying
setbacks. Building massing shall minimize a box -like appearance by creating openings along
the facade. Careful attention shall be paid to the exterior elevations to minimize the bulk of
the larger buildings and maximize opportunities to create a pedestrian -scale environment.
16. Building Design: The building design should be consistent with the attached conceptual
plans. Landscaping and hardscape designs shall be carefully integrated to provide ease of
access, shading, and a pedestrian -friendly design. The residential courtyards shall be richly
landscaped with appropriately sized and designed open space elements.
CONSTRUCTION SIGNS
The Developer shall design, construct and install a construction sign for the Project to comply
with the City of Vernon specifications. The sign shall be installed at a prominent location to be
approved by the City of Vernon or Designee.
DEVELOPMENT APPROVALS AND ENTITLEMENTS
The Developer shall comply with Disposition and Development Agreement (DDA) and
the mitigation measures contained in the Mitigation Monitoring Reporting Program issued by the
City of Vernon and all applicable code, permit, and fee requirements of the United States of
America (including A.D.A. requirements), State of California, and the County of Los Angeles.
The Developer shall submit plans to the City of Vernon for plan check in a timely fashion to
maintain the Schedule of Performance. It shall be the responsibility of the Developer to obtain
all permits and other required approvals and entitlements as are necessary and consistent with the
DDA to ensure the construction of the Project. The Developer shall dedicate and be responsible
for the construction of improvements in public rights -of -way in conformance with the
requirements, if any, of the City of Vernon for the Project. Developer shall take all necessary
steps and sign all necessary documents in recordable form to create, move or abandon easements
and rights of way as may be required by the City of Vernon for the development of the Site in
accordance with this Agreement.
Attachment No. 5-1
1017942.5
ATTACHMENT NO.6
SCHEDULE OF PERFORMANCE
GENERAL
1
Execution of this Agreement. This Agreement
Not less than five (5) days prior to the
shall be executed by the Developer and a copy
City's consideration of the Agreement.
of the executed Agreement shall be sent to the
City.
2
Execution of Agreement by City. er the
Within five (5) days after approval of
Agreement has been approved, the City shall
this agreement by the City, but not later
execute the Agreement.
than March 5, 2013.
FINANCING
3
Submission of 9% Tax Credit Application.
Not later than the due date for first tax
Developer shall complete and submit an
credit application round (currently
application to TCAC for 9% Tax Credits
expected to be March 6, 2013), and not
later than the due date for second tax
credit application round (if necessary)
(currently expected to be July 3, 2013).
4
Submittal of Financing Plan. Developer shall
Not less than ninety (90) days prior to
submit a Final Financing Plan as required by
the scheduled Commencement of
Section 401 of the Agreement, including copies
Ground Lease and close of construction
of all commitment letters and conditions of
financing, or as otherwise required by
approval and demonstrating sufficient debt and
TCAC Regulation 10325(c)(8).
equity commitments required to complete the
Housing Development in accordance with the
Scope of Development.
5
Approval of Financing Plan. City shall approve,
Within thirty (30) days after receipt of
conditionally approve, or disapprove Financing
complete financing plan from Developer
Plan.
and prior to the Commencement of
round Lease.
Attachment No. 6-1
1017942.5
BUILDING APPROVALS
6
Submission of Development Plans to City. The
Within thirty (30) days after receipt of
Developer shall submit Development Plans to
9% Tax Credit allocation.
City for review and evaluation with respect to
the construction of the Housing Development
pursuant to Section 303.
7
City Approval of Development Plans. City shall
Not later than ninety (90) days after
approve, conditionally approve, or disapprove
submission and acceptance as complete.
Development Plans.
8
Application for Land Use Approvals. The
Completed
Developer shall submit applications for all land
use approvals to City pursuant to Section 304.
9
City Approval of Development Plans. City shall
Concurrently with approval of this
approve, conditionally approve, or disapprove
Agreement.
land use approvals.
10
Issuance of Permits. City shall issue grading and
Concurrently with close of financing
building permits.
and Commencement of Ground Lease.
Attachment No. 6-2
1017942.5
ESCROW FOR COMMENCEMENT OF GROUND LEASE
11
Open Escrow. City will open escrow to enter into
Within thirty (30) days after receipt
ground lease.
of 9% Tax Credit allocation.
12
Title Exceptions. The Developer shall submit to
Within thirty (30) days after the
the City its written approval or disapproval of the
Developer receives the Preliminary
exceptions to title per Section 202. City shall
Title Report from the City.
respond in accordance with Section 202.
13
Final Environmental Release. Developer shall
Within sixty (60) days after receipt
complete physical and environmental investigation
of 9% Tax Credit allocation.
of the Site and provide a written release to the City.
14
Deposit of Documents into Escrow.
Not less than three (3) days prior to
The City and Developer shall execute the Ground
Commencement of Ground Lease.
Lease, and shall execute and deposit with Escrow
Agent the Memorandum of Lease, the Regulatory
Agreement, and such other documents required to
be recorded at the Close of Escrow.
15
Close of Escrow. The Close of Escrow and the
Within thirty (30) days after City and
Commencement of Ground Lease shall occur as
Developer have complied with all
specified in Section 203 of this agreement.
conditions precedent to closing as
stated in Section 305 of this
Agreement.
CONSTRUCTION
16
Commencement of Construction. Developer shall
Within thirty (30) days after
commence construction of the Housing
Commencement of Ground Lease.
Development.
17
Completion of Construction. Developer shall
Not later than two (2) years after 9%
complete construction of the Housing Development
Tax Credit allocation.
in accordance with all conditional approvals.
18
Certificate of Occupancy. Developer shall request
Within ten (10) days after
and City shall issue a Certificate of Occupancy for
completion of construction, but not
completion of the construction of the Housing
later than two (2) years after 9% Tax
Development.
Credit allocation.
Attachment No. 6-3
1017942.5
NOTES:
1. Days are calendar days.
2. The City and the Developer may, by mutual written agreement, amend or modify any item
contained herein or the date for performance. The City Administrator (or designee) is hereby
authorized to approve minor amendments as set forth in this Schedule of Performance on
behalf of the City. Any amendments deemed major shall be submitted to the City Council
for consideration.
Attachment No. 6-4
1017942.5
ATTACHMENT NO.7
PREVAILING WAGE AND PUBLIC WORKS REQUIREMENTS
I. Developer's Requirements:
(1) Obtain the prevailing wage rate from the Director of Industrial Relations in
accordance with Labor Code Sections 1771 and 1773.
(2) Specify the appropriate prevailing wage rates, in accordance with Labor Code
Sections 1773.2 and 1777.5.
(A) The posting requirement is applicable for each job site.
EXCEPTION: If more than one worksite exists on any project, then the applicable
rates may be posted at a single location which is readily available to all workers.
(B) If a wage rate for a craft, classification or type of worker is not published
in the Director's general prevailing wage determinations, a request for a special determination
should be made by the awarding body to Chief, Division of Labor Statistics and Research, P.O.
Box 420603, San Francisco, CA 94142, at least 45 days prior to the project bid advertisement
date.
(3) Notify the Division of Apprenticeship Standards, Department of Industrial
Relations. See Labor Code Section 1773.3.
(4) Inform prime contractors, to the extent feasible, of relevant public work
requirements:
NOTE: Requirement information may be disseminated at a preacceptance of bid
conference or in a call for bids or at an award of bid conference.
The public works requirements are:
(A) the appropriate number of apprentices are on the job site, as set forth in
Labor Code Section 1777.5.
(B) workers' compensation coverage, as set forth in Labor Code Sections
1860 and 1861.
(C) keep accurate records of the work performed on public works projects, as
set forth in Labor Code Section 1812.
(D) inspection of payroll records pursuant to Labor Code Section 1776, and as
set forth in Section 16400 (e) of Title 8 of the California Code of Regulations.
Attachment No. 7-1
1017942.5
(E) and other requirements imposed by law.
(5) Withhold monies. See Labor Code Section 1727.
(6) Ensure that public works projects are not split or separated into smaller work
orders or projects for the purpose of evading the applicable provisions of Labor Code Section
1771.
(7) Deny the right to bid on public work contracts to contractors or subcontractors
who have been debarred from bidding on public works contracts, as set forth in Labor Code
Section 1777.7.
(8) Not permit workers on public works to work more than eight hours a day or 40
hours in any one calendar week, unless compensated at not less than time and a half as set forth
in Labor Code Section 1815.
EXCEPTION: If the prevailing wage determination requires a higher rate of pay for
overtime work than is required under Labor Code Section 1815, then that higher overtime rate
must be paid, as specified in subsection 16200(a)(3)(F) of Title 8 of the California Code of
Regulations.
(9) Not take or receive any portion of the workers' wages or accept a fee in
connection with a public works project, as set forth in Labor Code Sections 1778 and 1779.
(10) Comply with those requirements as specified in Labor Code Sections 1776(g),
1777.5, 1810, 1813, and 1860.
II. Contractor and Subcontractor Requirements.
The contractor and subcontractors shall:
(1) Pay not less than the prevailing wage to all workers, as defined in Section 16000
of Title 8 of the California Code of Regulations, and as set forth in Labor Code Sections 1771
and 1774;
(2) Comply with the provisions of Labor Code Sections 1773.5, 1775, and 1777.5
regarding public works jobsites;
(3) Provide workers' compensation coverage as set forth in Labor Code Section 1861;
(4) Comply with Labor Code Sections 1778 and 1779 regarding receiving a portion
of wages or acceptance of a fee;
(5) Maintain and make available for inspection payroll records, as set forth in Labor
Code Section 1776;
Attachment No. 7-2
1017942.5
(6) Pay workers overtime pay, as set forth in Labor Code Section 1815 or as provided
in the collective bargaining agreement adopted by the Director of Industrial Relations as set forth
in Section 16200 (a) (3) of Title 8 of the California Code of Regulations;
(7) Comply with Section 16101 of Title 8 of the California Code of Regulations
regarding discrimination;
(8) Be subject to provisions of Labor Code Section 1777.7 which specifies the
penalties imposed on a contractor who willfully fails to comply with provisions of Section
1777.5;
(9) Comply with those requirements as specified in Labor Code Sections 1810 and
1813; and
(10) Comply with other requirements imposed by law.
Attachment No. 7-3
1017942.5
ATTACHMENT NO.8
SITE MANAGEMENT PLAN
[To Be Inserted]
Attachment No. 8-1
1017942.5
MANAGEMENT PLAN
52nd Drive Apartments
Vernon, California
(.MANAGEMENT
A. Role and responsibility of the Owner and/or delegation of authority to the management agent.
Scope of Responsibilities. The respective responsibilities of 52nd Drive Apartments, (the "Owner")
and Solari Enterprises, Inc. (the "Agent') are described in the Management Agreement. This
Management Plan (the "Plan") is incorporated by reference in to the Management Agreement. This
Plan does not supersede the Agreement. The terms of the Agreement supersede any terms of this
Plan if there are any contradictory provisions, while the terms of this Plan supplement the terms of the
Agreement if any provisions in the Plan are not explicitly included in the Agreement.
The Plan is also a requirement of the Disposition and Development Agreement, Ground Lease and
Regulatory Agreement between the City of Vernon ("City") and Owner. Under these agreements, the
52n0 Drive Apartments are required to be managed in accordance with this Plan.
The Agent will need prior approval from the Owner before taking action as noted below
a) Letting of any large contracts such as exterior painting, remodeling, etc.
b) Disbursements in excess of $3,000 for labor and or materials required to maintain the development.
The Agent must make every effort to keep disbursements within the guidelines of the projected
budget amounts.
2. Change in Management Agent. The Owner maintains a list of property management agents who
have the experience and capacity to manage the site and who are experienced in publicly supported
affordable housing projects.
The Management Agreement provides that the Agreement may be terminated by mutual consent of the
Owner or the Agent with sixty (60) days written notice.
If the Agent changes after occupancy, the Owner shall immediately seek and contract for services with
another agent. The Owner and the Agent shall abide by the procedures outlined in the Management
Agreement. The Owner shall be responsible for providing the new Agent with the scope of
responsibilities for on -going operations.
The City is entitled to reasonably approve changes to the Agent.
52n' Drive Apartments — Management Plan Page 1 of 12
B. Personnel Policy and Staffing Arrangements.
1. Job Titles and Responsibilities. The following personnel will be involved in the management of the
property.
a) Regional Manager: Detailed job description appears in Exhibits.
b) Compliance Specialist: Detailed job description appears in Exhibits.
c) Property Manager: Detailed job description appears in Exhibits.
d) Maintenance: Detailed job description appears in Exhibits.
Agent and all of its personnel are prohibited from lobbying, influencing or attempting to influence any
residents of the 52ntl Drive Apartments, or any other registered voters or residents of the City, with
respect to any matters which require the approval of the City or the electorate of the City.
2. Hiring Policy.
a) Minimum job qualifications for each position are detailed in the job descriptions in Exhibits.
b) Interested applicants may contact the Management Agent's Home Office to establish a time to
come in and complete an application. An applicant will be required to complete a written application
and take a drug test. Skills testing and an oral interview may also be required. The Agent will
Inform each applicant if they were accepted or the rejected for an employment opportunity.
c) Applicants are considered for positions, and employees are treated during their employment without
regard to race, ethnicity, national origin, religion, creed, sex, age, marital or veteran status, medical
condition or handicap. All hiring of personnel shall conform to Equal Employment Opportunity
guidelines.
It is the intent of the Agent to comply with the laws and regulations, as applicable, concerning fair
employment and affirmative action. The Agent will work with the Owner to actively recruit qualified
minority candidates for all jobs. Special efforts will be made to provide information regarding job
openings to minority candidates and contractors through outreach to community organizations,
bulletin boards, newspapers, and other communications media. All hiring materials will indicate that
the Agent is an "Equal Opportunity Employer."
3. Training
Staff will receive comprehensive training by the Management. In addition, the Regional Manager will
provide concentrated training to personnel on a regular basis during the site visits. Training of all
personnel covering the program guidelines and management policies will be carried on an ongoing
basis. In addition, the Agent will inform its staff in writing of all changes in management policies and
requirements immediately after any such changes have been published. The project related personnel
would be sent to relevant management workshops sponsored by various property management
associations and agencies for the purpose of updating and renewing work -related skills.
52n' Drive Apartments — Management Plan Page 2 of 12
4. Employment of Residents
The Agent may give priority to qualified residents of 52nd Drive Apartments and then to members of the
local community in hiring of project personnel, and will make available to the residents all pertinent
information, such as qualifications, remuneration, application procedures, etc.
Depending upon the employment position, unit rent may be affected by employment. If rent is adjusted,
such adjustment shall be included as part of the employees compensation and shall be established as
such in a written work agreement between the Agent and the employee.
C. Plan for Maintaining Adequate Accounting Records and Handling Necessary Forms and Vouchers
1. Project Accounting Basis.
Financial accounting, reports, and records shall be in conformance with standard accrual basis
accounting procedures, and shall be responsive to the guidelines provided by the regulatory agencies
connected with the project.
The Agent shall maintain all accounting records on a computer system at the central office location.
Records of rent collection and all financial transactions will be transmitted to the Home Office and input
into the computer system where a general ledger, cash receipts and disbursements records will be
maintained.
All regulatory reporting documents will be completed in conjunction with the Owner and will be based
upon the requirements of the regulatory agencies. At a minimum, the Owner shall receive monthly
reports concerning the following:
a) Cash status report including cash receipts, disbursements and receivables.
b) List of accounts payable.
c) Comparisons of actual versus budgeted operating costs as well as comparisons with the operating
costs in the previous year.
d) Vacancy report.
2. Operating Disbursements
Disbursements from the operating account shall be made as described in Paragraph 13 of the
Management Agreement. Bills will be paid and accounts will be funded pursuant to the requirements of
the project's Management Agreement and Loan Agreement. Specifically:
a) A purchase order system will be utilized to document most project expenses with the exception of
items and services provided on a regular contractual basis (utilities, trash removal, service
contracts, etc.).
b) Purchase order copies will be matched to invoices and approved by the property manager prior to
payment. Payments will be processed semi-monthly.
c) The Agent and/or Owner shall maintain the following separate accounts:
General Operating Account. The Agent shall maintain an operating account for rent collection and
payment of the project's operating expenses.
52nd Drive Apartments - Management Plan Page 3 of 12
Operating Reserve Account. The Agent shall maintain the operating reserve account. This account
will be initially funded as required by the lenders and investors to the project in the amount
established in the regulatory agreements. Subsequent deposits to this account will be made in
amounts as specified in the annually approved operating budgets. Funds may be transferred from
this account only to cover actual operating expenses in excess of the approved budget amount, or
to compensate for vacancy and bad debt losses in the approved budget amount. Prior approval
must be obtained before withdrawal of funds.
Replacement Reserves. This account will be funded through regular contributions from the
Operating account. The initial contribution to this account will be determined by the lenders and
investors to the project in amount established in the regulatory agreements. The amount of funds
will be based on anticipated capital improvements, project upgrading, and replacement items that
the projects physical assets will require. Prior approval must be obtained before withdrawal of
funds.
Security Deposits. The Agent will maintain a Security Deposit Account. The account shall be
separate from the operating account. (See Section 5 for additional information on the Security
Deposit Account.)
3. Cost Control
Expenses in excess of $3,000 require the Owner's specific approval, except for emergency repairs
where the Agent will communicate with the owner as soon as possible. Purchase contracts in excess
of $2,000 must be put out for three bids.
All reporting and accounting requirements shall be governed by the Management Agreement.
4. Vacancy and Rent Loss Records
As outlined In the Management Agreement, the Agent shall prepare, as part of the monthly reports to
the Owner, an Income/expense statement, and a rent roll showing scheduled and actual rents with a list
of resident delinquencies. Delinquency reports shall indicate whether residents are 30, 60, or 90 days
behind in their rent.
5. Security Deposits
Security deposits will be collected in an amount equal to one (1) month's rent. The Agent shall establish
an interest bearing account for Security Deposits.
The amount of any deductions from the security deposit will be determined by the Agent's Property
Manager under guidelines established by the Agent and approved by the Owner. Security deposits may
be used to pay for resident -caused damages, lost keys or garage door remote controls, delinquent rent,
late fees, legal fees and any other reasonable expense caused directly as a result of a resident's
actions. If no charges are made against a resident's security deposit, a resident shall be entitled to a
refund of a security deposit. Interest shall be included in such refund to the extent required so by any
applicable law. Security deposit refunds will be mailed to a former resident within 21 days of departure.
Any accrued interest on security deposits that is not required by law to be refunded will be made
available for operations and repairs related to the project.
Security deposits shall be maintained in a separate account from the operating and reserve accounts.
Security deposits shall be shown as liabilities on all project reports, and not included as income.
52ntl Drive Apartments — Management Plan Page 4 of 12
Upon vacating a unit, the Agent shall inspect the departing resident's unit to determine whether the
resident household caused.any damages while they occupied the unit. The inspection form prior to
move -in shall be used as the basis of comparison. In the event that there are resident -caused
damages, the Agent shall prepare within 21 days of the vacate date, an estimate of the cost of repairing
the damages and provide the estimate to the resident. Within 21 days of departure, the Agent shall
make the necessary repairs and send the former resident an itemized list of repair costs (if any), and
credit the security deposit against the cost of repairs. The former resident shall be sent a check for the
balance of the security deposit, if any. Should the repair costs exceed the amount of the security
deposit, and then the former resident will be sent an invoice for the excessive cost of the repairs. All
documentation shall be maintained in the former resident's file.
D. Management Plan Updates
The Management Plan shall be updated on the following occasions:
a) Change or modifications of 52nd Drive Apartments' management guidelines, which will be reviewed
annually.
b) Alteration of 52nd Drive Apartments' staffing that necessitates operating procedure revisions.
E. Property and Liability Insurance
The Owner shall arrange for the Project to be insured against loss by fire and such other hazards,
casualties, liabilities and contingencies, and in such amounts and for such periods as required by the
regulatory agencies.
IL OCCUPANCY
A. Unit Breakdown
52nd Drive Apartments will have 44 residential units comprised of 1, 2 and 3 bedroom units serving
households within 30% - 55% Area Median Gross Income Levels. There will also be 1 management unit.
All applications received will be reviewed for all program requirements and eligibility restrictions.
B. Marketing Plans and Procedures
1. Affirmative Plans and Procedures
The Agent will be responsible for marketing and leasing the units. The rental office will be located on
site and the Owner will supply all of the necessary office furniture (desk, file cabinet, chairs, etc.) and
equipment (typewriter, computer, printer calculator etc.).
Units shall be marketed in accordance with Affirmative Fair Housing marketing guidelines. All
advertising for 52nd Drive Apartments shall include prominent use of Equal Housing Opportunity logos,
slogans and/or statements of intent to affirmatively market the units.
Outreach to the community will specifically be through newspapers, local government agencies such as
the City of Vernon, Housing Authority of the County of Los Angeles, Community Organizations and
internet listings. The outreach will be citywide and reach a diverse racial, ethnic and economic mix.
5e Drive Apartments — Management Plan Page 5 of 12
2. Resident Selection
The initial rent -up shall be conducted by the Agent's personnel and supervised by the agent. The Agent
shall utilize staff members that are well trained in eligibility requirements, family composition criteria,
unit size selection processes, and Owner -approved selection criteria. The resident selection process
shall be implemented in a manner which prevents favoritism and outside influences of any kind in the
selection of residents. The following is a summary of resident selection procedures, using a lottery
system:
a) An interest list will be created at the time of 52nd Drive Apartment's groundbreaking.
b) Applications and an information page, regarding the apartments and the location of the upcoming
lottery, will be mailed to all households on the interest list approximately 160 days prior to the
Certificate of Occupancy date.
c) A deadline, approximately 130 days prior the Certificate of Occupancy date, will be set for
completed applications to be submitted to Solari Enterprises, Inc. in order to be included in the
lottery.
d) Only one application per household will be entered into the lottery drawing. Late, incomplete,
duplicate and ineligible applications will not be entered into the lottery drawing.
e) The lottery will be held, approximately 125 days prior to the Certificate of Occupancy date at a
space in the City of Vernon's City Hall, allowing access to those interested in attending.
f) All applications will be placed into individual envelopes. All applications with a preference will be
placed Into a container, mixed and pulled one at a time, in random order. After all of the
applications with a preference have been drawn, all applications without a preference will be placed
into a container, mixed and pulled one at a time, in random order. (Applicants will not be pre-
screened prior to the lottery process).
g) As each application is pulled it will be marked in numerical order, indicating the lottery number.
h) A preference shall be provided for all applicants who are employed or residing In the City of Vernon
or within a 1 mile radius of the development site as measured from the center of the site.
i) All applicants will be mailed a letter notifying them the lottery took place, Inform them of their lottery
number and of their preference, if applicable. The letter will also state that a lottery number does not
guarantee admission or denial to the community.
j) Approximately 120 days prior to the Certificate of Occupancy date initial interview letters will be sent
to applicants. Typically we process 3 — 5 applicants per unit (44 units will result in 132 to 220 letters
being mailed out).
k) Initial interviews will be held at which time the applicants will begin the eligibility process, including
authorizing the release of information, via third -party verification forms related to income, assets,
student status and background check data.
1) Upon determination of eligibility, the applicant will be offered residency, placed on the waiting list or
denied. The waiting list will be updated on a regular basis (every six months). Applicants on the
waiting list will be required to contact the manager (in writing) at least every 6 months in order to
remain on the waiting list.
52nd Drive Apartments — Management Plan Page 6 of 12
m) Any qualified applicants not able to move in will be placed on a waiting list and shall receive a letter
informing them of their status.
n) In determining whether to select an applicant for occupancy, Agent shall apply the same reasonable
and objective standards and criteria that it applies in similar affordable apartment developments that
it manages, and the prevailing standards and criteria for the management of affordable apartment
developments in Los Angeles County. Residents shall not be selected or rejected based upon
outside influences or favoritism of any kind.
o) Those applicants not selected for occupancy shall be provided with written notification stating the
reasons for their ineligibility. Such reasons might include but are not limited to the following: over
income, insufficient Income (inability to pay the rent), and bad credit history (delinquent or unable to
pay on accounts, any judgments, or late payments, although applicant is allowed to explain
reasons). Those applicants rejected for residency shall be provided with an opportunity to appeal.
The appeal process shall allow for the applicant to provide supplemental information to the
application including additional third party verification and/or testimony.
p) The Agent shall attempt to contact those households that have been on the waiting list for the
longest period of time. If a household cannot be contacted after documented attempts, the Agent
shall interview the eligible households that responded to contacts, with preference being given to
those households that have been on the waiting list the longest. The Interview shall include not
only those items listed on the Interview Checklist, but shall explain management practices and
guidelines. Prospective residents will be informed that continued income eligibility and annual
income recertification will be required as a condition of occupancy. Applicants who are deemed
suitable for occupancy shall have the opportunity to inspect the unit to be rented, shall sign an
inspection form and a rental agreement, and shall pay the security deposit.
q) Applicants will then be screened in numeric order of the eligibility list, subject to any preferences
herein stated, to determine if they comply with the secretion criteria to lease a unit. If they meet the
screening and selection criteria they will be offered a unit.
Note - a lottery will be held each year, approximately 30 days prior to the anniversary date of the date
the certificate of occupancy is issued In similar manner as provided above. The eligibility list in place at
the time a unit becomes vacant will be the list that will be used to screen for an applicant to lease the
vacant unit. Those applicants on the current eligibility list will be asked to resubmit an application 60
days prior to the next lottery. Those applicants and any new applicants who have submitted
applications prior to the lottery date will be placed in the lottery. The purpose of the annual lottery is to
provide an equal opportunity to a new applicant to gain a unit in the building and to keep the interest list
current with applicants interested in being a potential resident of the building.
3. The City of Vernon
The lottery process and documentation will be made available to representatives of the City of Vernon
for audit. The City of Vernon will contact Solari Enterprises, Inc. in writing to determine a mutually
agreeable date and time for the City to review the process.
4. Appeals Process
Applicant's that do not meet the Resident Selection Criteria will receive a Letter of Ineligibility.
Applicants have the right to make a written request to Solari Enterprises, Inc. within 14 days of receipt
of the letter to request a meeting to discuss their ineligibility status. Solari Enterprises, Inc. will review
the appeals information and provide a written response within 5 days of the appeals meeting.
5. Pre -Occupancy Orientation
52n° Drive Apartments — Management Plan Page 7 of 12
A pro -occupancy orientation program will be provided for applicants during the interview process. If
applicants are accepted, at the time of the execution of the lease and payment of security deposit, the
Owner and Agent shall re -orient the households on the project. The orientation shall include a full and
detailed review of the project house rules, and will also include a question and answer period during
which the residents can become acquainted with each other as well as the Owner and the Agent.
C. Procedures for Determining Resident Eligibility and for Certifying and Annually Recertifying
Household Income and Size
1. Initial Resident Eligibility
Steps to determine initial income eligibility are described in Section II above.
2. Annual Resident Recertification
Each household will be informed during the interview and orientation process of the requirement to
have household income and composition re -certified annually.
Annual interviews with each household will be scheduled according to a recertification schedule
established by the Agent. Every calendar year every household must be re -certified. The re-
certification procedure will begin 120 days prior to the required time of completion. The full re-
certification process will be almost identical to the initial certification required at move in time.
Households determined to exceed the income limit at the time of their annual recertification, will invoke
the Next Available Unit Rule, as designated by Section 42 of the IRS Code.
3. Resident Occupancy Standards
a) Pets: No pets are allowed in 52nd Drive Apartments.
b) Permissible Absences: Resident families are required to occupy 52nd Drive Apartments as their
primary place of residence. Absences beyond 45 days will be permitted for emergency purposes
only, as long as rental payments are kept current during the absence. Requests for absences must
be submitted to the Agent In writing, giving the reasons for the absence, the dates of the expected
absence, and any other material circumstances that might affect the Agent's decision about the
appropriateness of the absence. The resident will be notified In writing of the decision.
c) Resident Incapacity: In the event that a resident appears to be incapacitated so as to make self
care difficult, the Agent will Immediately contact relatives or will contact referral agencies to assist
the resident. In the event that the resident becomes so incapacitated as to be unable to care for
himself/herself, the County Guardian's Office may be contacted to determine what facility the
resident should be transferred to.
d) Live -In Attendants: Residents with disabilities severe enough to require live-in attendants shall be
required to present written certification from their physician that their disabilities require live-in care.
In that event, the unit must be large enough to accommodate the attendant according to published
occupancy standards.
D. Rent Collection Policies and Procedures
52nd Drive Apartments - Management Plan Page 8 of 12
1. Rent Calculations and Collections
The Owner shall agree to the rent for each unit at the time of lease up in advance. The prospective
resident household shall be informed of the rent prior to executing a lease. Annual rent increases, if
any, shall be approved subject to approval. Residents shall be informed of any rent increases at least
30 days prior to their implementation.
Rent collection procedures are defined in Paragraph 8 of the Management Agreement. Typically, rents
shall be delivered to the Property Manager. The Property Manager shall provide the resident with a
receipt and enter the amount paid into the monthly rent receipt journal. Rents shall be collected by the
Agent and deposited into the operating account.
All rents shall be due on or before the first working day of each month. Rent is considered delinquent
on the second working day of the month. Rents must be paid by cashiers check or money order. No
cash will be accepted.
2. Actions for Late Rents
Residents who have not paid their rent by the second working day of the month will be served a Notice
to Pay Rent or Quit.
Failure to pay rent will result in eviction. The Agent may consult with the Owner prior to initiating any
legal action against any residents. The Agent shall provide the attorney with copies of all documents
and request that an eviction be scheduled with the court. Eviction proceedings must follow procedures
outlined in the California Civil Code. The household will be charged for the cost of any legal actions the
Owner incurs due to the actions of the household.
3. Partial Rent Payments
Partial rent payments will not be accepted unless specific arrangements with the Agent are made in
advance of the time when rent is due. Rent is due in full on the first working day of each month.
4. Recovery of Damages in Excess of Security Deposit
The full amount of back rent and damages will first be established informally and then formally in a
judicial unlawful detainer action so that 52nd Drive Apartments may claim damages as part of the
court's judgment. If the damages are significant and the residents income is determined sufficient, a
collection agency may be contacted to secure the judgment.
E. Procedures for Appeal and Grievance
52ntl Drive Apartments - Management Plan Page 9 of 12
Eviction Procedures
Residents that have violated their lease or other regulations will be given written warnings of the
violations. Should the violation continue, the Agent would inform the Owner that they intend to initiate
eviction procedures.
Evictions for nonpayment of rent are described in Section II.0 (2) above. Eviction for nuisance shall be
undertaken when there is documentable evidence (correspondence, witnesses of illegal activities,
police actions, lease violations, etc.) available that the Agent and the attorney may determine to be
winnable in court. Court actions typically require six to ten weeks for a decision. Fully contested
evictions can take longer, and uncontested evictions, depending upon the workload of the court at the
time, may take slightly less time.
No rent will be collected during any eviction for non-payment actions. If a resident who is in the
process of being evicted for nonpayment of rent desires to pay the rent in full, then the Property
Manager shall confer with the Agent to determine whether rent will be accepted. If rent is accepted, the
resident will be required to pay with money order or a cashier's check only. If it is determined that the
resident is chronically late or has a serious nonpayment problem, then the Agent has the option of
foregoing the rent and continuing with the eviction if the deadline specified in the Pay Rent or Quit
notice has already elapsed.
2. Processing Resident Complaints
There are occasions when problems may arise and it is very important that these problems are
discussed immediately and resolved before they have a chance to become serious. A problem should
first be taken to the Property Manager. If the Property Manager does not resolve it, the resident should
then contact the Regional Manager. If the problem is not resolved at this level, the resident may submit
in writing his/her complaint to the next position of authority, which is the Vice -President / COO for the
management firm. Complaints can be mailed or hand delivered to the Agent and can be signed or
anonymous.
3. Rules Violations
Residents who violate lease agreements, the projects house rules, shall always be notified in writing,
with a request to correct or remedy the violation. Duplicate records will be filed in the resident's file,
with any responses. If the same or other violation occurs or continues, then the resident will be advised
in writing that continued violations may result in eviction. If they still continue, the procedure described
in section E (1) above for nuisance violations will be Initiated.
F. Plans for Enhancing Resident -Management Relations
1. House Rules
House rules and regulations are an attachment to the Standard Lease Agreement. These will be
reviewed with the residents at the time of the initial interview and during orientation prior to move in.
2. Emergency Procedures
All management staff will be trained in emergency procedures and there will be regularly scheduled fire
drills annually. In addition, an emergency procedure sheet will be developed by the Agent and will be
provided to all residents upon move in. This sheet will describe procedures to be followed in the event
of fire, earthquake, or other major occurrence requiring emergency action on the part of management
staff or residents. Periodic resident meetings will be held to keep residents acquainted with emergency
procedures.
III. MAINTENANCE AND SECURITY
52n0 Drive Apartments — Management Plan Page 10 of 12
A. Identification and Repair of Construction Defects
The project architect and the Owners representative will inspect the project during entire construction
process to ensure that no construction defects are missed. If defects are found, the contractor shall be
immediately notified of the defects. Progress payments will not be submitted for payment unless
unconditional lien releases are attached to the contractor's request. The notice of completion will not be
recorded if there are significant defects present. Finally, the contractor's retention will not be paid until all
punch -list items are corrected.
If after Owner notification, the contractor fails to correct defects within a reasonable period of time, then the
owner shall inform the contractor that it will disburse funds from the retention in order to cure the defect.
The owner shall consult with its attorneys before carrying out this action.
B. Identification of Maintenance Staff
All routine janitorial work will be completed by the on -site person employed by the Agent. Any supplemental
or extraordinary janitorial work that is required will either be contracted out to a private janitorial firm or
undertaken by an employee of the Agent and billed to the Project as an additional expense. Maintenance
work will also be done by an employee of the Agent and billed to the project or contracted out to an outside
contractor. Outside contractors will generally be used for emergencies, unusual or specialized repairs, and
landscaping.
The Agent, according to Paragraph 10 of the Management Agreement, shall contract for work requiring a
licensed contractor such as major plumbing, electrical, or mechanical work.
C. Preventive Maintenance Schedule
A preventative maintenance schedule will be prepared and updated by the Agent. The Agent will contract
out for extermination and pest control services. General services will be performed once a month and for
Individual units on an as needed basis.
The exterior and interior of the building will be painted every five years or as needed. All equipment will be
maintained based upon the individual equipment guidelines. There will be annual inspections of all units to
determine maintenance needs. Monthly and weekly inspections of the exterior of the complex will also be
conducted.
D. Resident -Requested Maintenance
A service call form will be completed by the Property Manager. The Property Manager shall review the
requests and determine whether it requires emergency or routine attention. Emergency repairs are those
that cause or may cause significant damage, or make any area unsafe or uninhabitable. Every effort will
be made to correct emergency repairs within 24 hours. Exceptions to this could be when parts must be
ordered to complete the service. Further provisions for repairs are outlined in Paragraph 10 of the
Management Agreement and it will be given to the Property Manager. The Property manager will consult
with the Regional Manager to decide who will be assigned the work depending on the nature and scope of
the work. In the event that damages are resident -caused, the resident will be notified of the amount they
will be charged for the actual cost of repairs.
E. Inspection Forms
52nd Drive Apartments - Management Plan Page 11 of 12
Annual unit inspections will be completed and findings will be documented on the agent's inspection form.
F. Schedule of Anticipated Useful Life and Replacement.
Item
Years Useful Life
Landscaping
5-10
Carpet/Flooring
5-10
Kitchen Appliances
10
Common Appliances
10
Roof
10-15
Mechanical
25-35
G. Surveillance I Controlled Access
52nd Drive Apartments will have adequate exterior lighting and controlled access to the common areas
surrounding the units. Surveillance cameras will be installed within the building, recordings will be able to
be recalled based on date and time of a potential event. The recording will be able to be burned to a
device that can be provided to the local police department as requested for evidence or for their
investigation.
Specifically:
• Exterior Parking lot lighting will be a minimum of 1foot candle.
• Common area courtyards will be a minimum of 2 foot candles.
• The community will be secured with concrete masonry unit wall and fence.
• Community entrances and common areas will have electronic controlled access to residents only.
• Buildings will be pre -wired for surveillance cameras at all common areas and community site
entrances.
• Surveillance system will allow for monitoring and recording from a centralized location.
• Crime prevention through environmental design strategies have been implemented Into the design.
• Signage note surveillance will be posted on the community's main entrances.
Language regarding the community being a crime free community, including no drugs, violence, or crime in
general Is included in the lease. Signage will be posted on -site stating the community participates in a
crime prevention program. Meetings will be scheduled during the year with the residents and police
department to educate residents on crime prevention and to discuss any concerns regarding crime.
All persons are responsible to be aware of their surroundings.
IV. ATTACHMENTS
1. Standard Lease Form
2. Rules and Regulations
3. Operating Budget
52n0 Drive Apartments - Management Plan Page 12 of 12
RENTAL AGREEMENT
■FAni a:c
1. PARTIES AND DWELLING UNIT:
The parties to this Agreement are:
Referred to as the LANDLORD, and
Referred to as the RESIDENT. The LANDLORD leases to the RESIDENT unit number
Located at
In the development known as
2. TERM:
The Initial term of this Agreement shall begin on and end on
Alter the tnitiai Ion ends, the Agreement will continue for successive terms of one month each unless automatically terminated as
permitted by paragraph 23 of this Agreement.
S. RENT:
The Resident agrees to pay $ for the partial month ending an After
that, Resitlent agrees to pay a rent of $ per month. This amount Is due on the 10 day of the
month at
4. CHANGES IN RESIDENT'S SHARE OF REM:
The Resident agrees that the amount of rent the Resident pays may be changed during the term of the Agreement if:
A. The Contract Administrator determines, in accordance with Program procedures, that an increase in rent is needed;
B. The Contract Administrator changes any allowance for utilities or services considered in determining the Residents rent:
C. The. income, the number of persons in the Resident's household or other factors considered in determining the Resident's rent.
D. The procedures for delemtining the Resident's rent change; or
E. The Landlord agrees to Implement changes In the Resident's rent only In accordance with the time frames and administrative
procedures set forth in instructions and regulallons related to administration of the Program. The Landlord agrees to give the
Resident at least thirty (30) days advance written notice of any increase in the Resident's rent, except as noted in paragraph
22. The Notice shall slate the new amount the Resident is required to pay, the dale the new amount is effective, and the
reasons for the change in rent. The Notice will also advise the Resident that he/she may meet with the Landlord to discuss the
rentchange. -
S. CHARGES FOR LATE PAYMENTS:
Rent Is due on or before the to day of the month and late when paid on the V` day of the month. If the Resident does not pay
the lull amount of the rent shown in paragraph 3 by the end of the 5' day of the month, the Landlord may collect a fee of $
on the 8's tlay of the month. The Landlord may not terminate this Agreement for failure to pay late charges, but may terminate this
Agreement for non-payment of rent, as explained in paragraph 23. The charge discussed In this paragraph is in addition to the
regular monthly rent payable by the Resident.
S. LOW4NCOME HOUSING CREDIT:
The premises are to be operated In accordance wilh the requirements of the low-income housing credit Program under Section 42
of the Internal Revenue Code of 1986, as amended (the "Program"). Resident's rights hereunder will be subject to the
requirements that must be met under the Program in order for the Landlord to quality to take the cost of the premises Into basis for
calculation of the Landlord's tax credit. The Resident will cooperate with all LANDLORD requirements related to such compliance
and the Program.
7. EXCESS RENTS:
II it is determined that the premises are not a qualified low-income unit under Section 42 (1) (3) of The Internal Revenue Code
because the rem paid by the Resldems, plus the applicable utility allowance, for the Lease term exceeds the maximum rent
allowed under Section 42 of the Internal Revenue Cade, the Landlord shall Immediately pay to the Resident the amount of such
excess. with Interest. It the Resident no longer occupies the premises when the excess rent determination is made, the Landlord
shall use Its best efforts to locale the Resident for purposes of repaying the excess rent.
8. CONDRION OF DWELLING UNIT:
By signing this Agreement, the Resident acknowledges that the unit is safe, clean and in good condition. The Resident agrees that
all appliances and equipment in the unit are in good vroddng order, except as described on the Unit Inspection Report, which is
Attachment No. 1, paragraph 31 of this Agreement. The Resident also agrees that the Landlord has made no promises to
decorale, alter, repair or Improve the unit, except as listed on the Unit Inspection Report. -
9. CHARGES FOR UTILITIES AND SERVICES:
The following chart describes how the cost of utilities and services related to occupancy of the unit will be paid. The Resident
agrees that these charts accurately describe the utilities and services paid by the Landlord and those paid by the Resident.
A. The Resident must pay for the ulilllles in column (1). Payments should be made directly to the appropriate utility company.
The items in column (2) are included in the Resident's rent.
(1) Put an "if" by any (2) Put an 'k" by any
utility Resident pays Utility utility Included In
directly. Resident's rent.
Heal
Lights
Cooking
Water
Other (Specify)
B. The Resident agrees to pay the Landlord the amount shown below on the date the rent is due.
Show $ Amount Resident pays to Landlord in Addition to Rent.
Parking $
Other $
Other $
10. SECURITY DEPOSIT:
A security deposit in the amount of $ shall be required by the Resident at the time of execution of this Agreement.
The Landlord will told this security deposit for the period the Resident occupies the unit. After the Resident has vacated the unh,
the Landlord will determine whether the Resident Is eligible for a refund of any or all of the security deposit. The amount of the
refund will be delennlned In accordance with the following conditions and procedures.
A. The Resident will be eligible for a refund of the security deposit only If the Resident provided the Landlord with a thirty (30) tlay
written notice of Intent to vacate, required by paragraph 23. unless the Resident was unable to give the notice (or reasons
beyond his/her control.
uouaw omot I
B. After the Resident has vacated the unit, the Landlord will inspect the unit and complete another Unit Inspection Report. The
Landlord will permit the RESIDENT to participate In the Inspection, "he Resident so requests.
C. The Landlord will refund to the Resident the amount of security deposit less any amount needed to pay the cost of:
1) Unpaid rent;
2) Damages that are not due to normal wear and tear and are not listed on the Unit Inspection Report done to the premises
by the Resident, his/her family, guests or agents.
3) Charges for late payment of rent as described in paragraph 5; and
4) Charges for umretumed keys, cards and transmitters.
D. The Landlord will refund the amount computed in paragraph 10-C within twenty-one (21) days alter the Resident has
permanently vacated the unit, returned possession of the unit to the Landlord, and given hlarner new address to the Landlord.
The Landlord will also give the Resident a written list of charges that were subtracted from the deposil. If the Resident
disagrees with the Landlord concerning the amounts deducted and asks to meet with the Landlord, the Landlord agrees to
meet with the Resident and informally discuss the disputed charges.
E. If more than one person rents the unit, the Residents agree that they will work out the delaks of dividing any relund among
themselves. The Landlord may pay the refund to any Resident identified in paragraph 1 of this Agreement.
F. The Resident understands that the Landlord will not count the Security Deposit towards the last months rent or towards repair
charges owed by the Resident in accordance with paragraph 13.
11. KEYS AND LOCKS: -
The Resident agrees not to install additional or different locks or gates on any doors or windows of the unit withoul the written
permission of the Landlord. If the Landlord approves the Resident's request to install such locks, the Resident agrees to provide
the Landlord with a key for each lock. When this Agreemam ends, the Resident agrees to return all keys to the dwelling unit to the
Landlord, The Landlord may charge the Resident $5.00 for each key not returned.
12. MAINTENANCE:
1) Regulady dean all common areas of Iha community;
2) Maintain the common areas and facilities in a safe condition;
3) Avenge for collection and removal of trash and garbage;
4) Maintain all equipment and appliances in sate and working order,
5) Make necessary repairs with reasonable promptness;
6) Maintain exterior lighting in good working order;
7) Provide extermination services, as necessary; and
8) Maintain grounds and shrubs.
The Resident agrees to:
1) Keep the unit clean;
2) Use as appliances, fixtures and equipment in a safe manner and only for the purposes for which they are intended;
3) Not filler the grounds or common areas of the community;
4) Not destroy, deface, damage or remove any pan of the unit, common areas, or community grounds;
5) Give the Landlord prompt notice of any defects in the plumbing, fixtures, appliances, healing and cooling equipment or
any other pan of the unit or related facilllfes; and
6) Remove garbage and other waste from the unit In a clean and sale manner.
13. DAMAGES:
Whenever damage is caused by carelessness, misuse, or neglect on the pad of the Residenl, household members or guests, the
Resident agrees to pay:
A. The cost of all repairs and do so within thirty (30) days after receipt of the Landlord's demand for the repair charges; and
S. Rent for the period the unit is damaged whether or not the unit is habitable. For any such period, the Resident agrees to pay
the rent amount shown in paragraph 3 of this Agreement.
14. RESTRICTIONS ON ALTERATIONS:
The Resident agrees not to do any of the following without first obtaining the Landlord's written permission:
A. Change or remove any part of the appliances, fixtures or equipment in the unit;
B. Paint or install wallpaper or contact paper in the unit;
C. Attach awnings or window guards in the unit:
D. Attach or place any 6xWres, signs, or lances on the building(s), common areas, or the community grounds;
E. Attach any shelves, screen doors, or other permanent improvements In the unit;
F. Install washing machines, dryers, fans, heaters, or air condilloners, dishwasher, freezers: or
G. Place any aerials, amennaz or other electrical connections on the unit.
15. GENERAL RESTRICTIONS:
The Resident must live in the unit and the unit must be the Resident's only place of residence. The Resident shall use the
premises only as a private dwelling for himself/herself and the Individuals listed on the Certification and Recertification of Resident
Eligibility and paragraph 32 of this agreement. The Resident agrees to permit other Individuals to reside or visit for a period of over
three (3) days only after obtaining the prior written approval of the Landlord. The Resident agrees upon threat of eviction not 10:
A. Sublet or assign the unit, or any pan of the unit;
B. Use the unit for unlawful purposes;
C. Use premises for any purpose deemed hazardous by insurance companies carrying Insurance thereon;
D. Engage in or permit unlawful activities in the unit, in Me common areas or on the community grounds;
1) Permit guests or other household members to engage in unlawful activities in the unit, in the common areas or on the
community grounds. These unlawful activities include but are not limited to the possession, use aid/or sale of illegal
drugs and disturbances or acts of violence that damage or destroy the dwelling unit or disturb, gragifi, or injury to other
Residents.
2) The Resident further agrees not to engage personally in unlawful activities in the unit, in the common areas or on the
community grounds. Such activities include but are not limited to those listed In D (1) above.
E. Have pets or animals of any kind in the unit without prior written permission of the Landlord; or
F. Make or permit noises or acts that will disturb the rights or comfort of neighbors. The Resident agrees to keep the volume of
any radio, phonograph, television or musical Instrument at a level, which will not disturb the neighbors.
16. RULES:
The Resident agrees to obey the House Rules, which are Attachment No. 2, paragraph 31 to this Agreement. The Resident
agrees to obey additional rules eslablishad after the effective date of this Agreement it:
A. The rules are reasonably related to the safety, care and cleanliness of the building and the safety, comfort and convenience of
the Residents.
17. RECERTIFICATION:
Every year on or about the 10 day of , the Landlord will request the Resident to report the Income and
composition of the Resident's household and to supply any other information required for the purposes of determining the
Resident's continued Program eligibility, The Resident agrees to provide accurate statements of this Information and to do so by
the date specified in the Landlord's request. The Landlord will very, the information supplied by the Resident and use the verified
utwuamrmu 2
information to determine Program eligibility. The Resident agrees that all information supplied by the Resident Shall be subject to
inspection by representatives from the Tax Credit Allocallon Committee and other funding agencies.
A. If the Resident does not submit the required recertification information by the date specified In the Landlord's request, the
Landlord may impose the following penalties. The Landlord may implement these penaMes only in accordance with the
administrative procedures and time frames specified in handbooks and instructions related to the administration of the
Program.
1) Require the Resident to vacate.
B. The Resident may request to meet with the Landlord to discuss any changes resulting from the recertification processing. It
the Resident requests such a meeting, the Landlord agrees to meet with the Resident and discuss how the Resident's
continued Program eligibility was determined.
18. REPORTING CHANGES BETWEEN RECERTIFICATION:
The Residents shall notify the Landlord immediately in writing, if the household size changes, his or her income increases,
Residents) become a full lime student, or begins to receive HUD assistance. The Landlord may elect not to renew this Lease if
the Resident becomes a full lime student and the Landlord determines that the Resident's student status would disqualify the
household under the Program. The Landlord may adjust the Resident's rent and or utility allowance to reflect the Residents status
if the Resident becomes a HUD -assisted Resident.
19. SIZE OF DWELLING UNIT:
The Resident understands that units are assigned according to the size of the household. If the Resident is or becomes eligible for
a different size unit, and the required size unit becomes available, the Resident agrees to;
A. Move within thirty (30) days after the Landlord notifies him/her that a unit of the required size is available within the community;
or
B. Vacate the community
20. ACCESS BY LANDLORD:
The Landlord agrees to enter the unit only during reasonable hours, to provide reasonable advance notice of Ns/her Intent to enter
the unit, or to enter the unit only alter receiving the Resident's consent to do so, except when emergency siluations make such
notices impossible or except under Paragraph C below.
A. The Resident agrees to permit the Landlord, his/her agents or other persons, when authorized by the Landlord, to enter the
unit for the purpose of making reasonable repairs and periodic inspections.
S. Auer the Resident has given a notice of Inlant to vacale, the Resident agrees to permit life Landlord to show the unit to
Prospective Residents during reasonable hours.
C. If me Resident vacates before this Agreement ends, the Landlord may enter the unit to decorate, remodel, alter or otherwise
prepare the unit for m-occupancy.
21. DISCRIMINATION PROHIBITED:
The Landlord agrees not to discriminate based upon race, national origin, familial status, disability, color, religion, sex.
22, CHANGE IN RENTAL AGREEMENT:
The Landlord may change the terms and condition of this Agreement. The Landlord must notify the Resident. The Resident may
accept the charged terms and conditions by signing the new Agreement or the amendment to the existing Agreement and
returning it to the Landlord. The Resident may reject the changed terms and conditions by giving the Landlord written notice that
he/she Intends to terminate the tenancy. The Resident must give such notice at least thirty (30) days before the proposed change
will go Into Shoot. If the Resident does not accept the amended Agreement, the Landlord may require the Resident to move from
the community, as provided in Paragraph 23.
23. TERMINATION OF TENANCY:
After the first full year of the Lease term, the Resident may notify the Landlord of intent to vacate upon thirty (30) days written
notice.
A. To terminate this Agreement, the Resident must give the Landlord Ihlfty (30) days written notice before moving from the unit.
If the Resident does not give the full thirty (30) days notice, the Resident shall be liable for rent up to the end of the thirty (30)
days to which notice was required or to the dale the unit was re- rented, whichever date comes first.
B. Any termination of this Agreement by the Landlord must be carried our In accordance with agency regulations, State and local
law and the leans of this Agreement. The Landlord may terminate this Agreement for,
I The Resident's material noncompliance with the terms of this Agreement;
2) The Resident's material failure to carry out obligations under any Slate Landlord and Resident Act: or
3) Other cause, which includes, but is not limited to the Resident's refusal to accept the Landlord's purposed change to this
Agreement.
Material noncompliance Includes, but s not limited to, nonpayment of rent; repealed late payments of rent; failure to reimburse
Landlord within thirty (30) days for repairs made under paragraph 13 of this Agreement; repealed interference with the rights and
quite enjoyment of other Residents and on site staff; permihing unauthorized persons to live in the unit; serious or repeated
damage to the unit or common areas; creation of physical hazards; giving the Landlord false information regarding income or other
factors considered in determining the Resident's Program eligibility; failure of the Resident to timely supply all required information
on the income and composition, or eligibility factors, of the Resident household, including failure to meal the disclosure and
verification requirements for Social security numbers.
C. If the Landlord proposes to terminate this Agreement, the Landlord agrees to give the Resident wriffen notice of the proposed
termination. If the Landlord is laminating this Agreement, for other good cause, the termination notice must be received by
the Resident at least thirty (30) days before the date the Resident will be required to vacale from the unit. Notices of proposed
termination for other reasons must be given in accordance with any time frames set forth In State and local law.
D. It an eviction Is initiated, the Landlord agrees to rely only upon those grounds cited in the termination notice required by
Paragraph 23C.
All termination notices must
1) Specify the dale this Agreement will be terminated;
2) State the grounds for termination with enough detail for the Resident to prepare a defense;
3) Advise the Resident of his/her right to defend the action in court;
4) If the Resident requests a meeting to discuss the proposed termination of the Lease Agreement, the Landlord agrees to
meet and discuss the termination with the Resident.
E. Attorney Fees/ Collection Fees: In any action or proceeding arising out of this agreement, the prevailing party shall be entitled
to reasonable attorney's fees and costs. Resident also acknowledges that Landlord may turnover Residem's account to a
collection agency in the event that the Resident fails to pay any and all balances due at move -out and In such event. Resdenl
agrees to pay the service feels) / collection se(s) that are charged to the Landlord by the collection agency for collection
activities.
24. CRIMINAL BACKGROUND INVESTIGATION:
By signing this Lease. to the best of Resident's knowledge, neither the Resident nor any occupant of the household is subject of a
criminal investigation or arrest warrant. The Resident hereby authorizes the Landlord to perform a criminal background
investigation of the Resident or any occupant of the household in the event the Landlord, in is sole discretion, has reason to
believe that the Resident or any occupant Is engaged In criminal activity in the household or at the Community.
25, THE RESIDENT'S REPRESENTATIONS TO LANDLORD:
The Resident represents and warrants that all Information provided to Landlord, including the information provided in the
application for the rental of the Apartment (the "Application), is true, complete and correct. If any information the Resident provides
to Landlord is determined to be false, the Resident will be in breach of this Lease. The Resident understands and agrees that the
Application is hereby made a part of the Lease, and a breach of any representations or warranties in the Application shall be a
breach of this Lease.
26. HAZARDS: -
The Resident shall not undertake, or permit his/her household or guests to undertake any hazardous acts or do anything that will
increase the community's Insurance premiums. It the unit Is damaged by fire, wind, or rain to the extent that the unit cannot be
lived In, and the damage Is not caused or made worse by the Resident, the Resident will be responsible for rent only up to the date
of the destruction. Additional rent will not accrue until the unit has been repaired to a livable condition.
27. PENALTIES FOR SUBMITTING FALSE INFORMATION:
If the Resident deliberately submits false Information regarding income, family composition or other data on which the Resident's
eligibility Is based, the Landlord may require the Resident to vacate.
29. CRIME FREE COMMUNITY:
In consideration of the execution or renewal of a Lease, or of the dwelling unit identified In the Lease, the Landlord and Resident
agree as follows:
A. The Resident, any member of the Resident's household, or guest or other person under the Resident's control shall not
engage in criminal activity, including drug -related criminal adrvity, on or near development premises. "Drug -Related Criminal
AttMty" means the illegal manufacture, sale, distribution, use or possession with the intent to manufacture, sell, distribute, or
use, of a controlled substance as defined in Section 102 of the Controlled Substances Act, 21 US.C. 802.
B. The Resident. any member of the Resident's household, or guest or other person under the Rasidant's control shall not
engage in any act intended to faciltals criminal activity that threatens the health, safety, right to peaceful enjoyment of the
premises by other Residents; any criminal activity that threatens the health, safety, or right to peaceful enjoyment of their
residences by persons residing in the immediate vicinity of the premises: any criminal activity that threatens the health or
safely of on -she property management staff responsible for managing the premises: or any drug related criminal activity on or
near such premises. engaged in by a Resident, any member of the Residents household, or any guest or other person under
the Resident's control shall be ground for termination of tenancy.
C. The Resident or members of the Resident's household will not permit the dwelling unit to be used for, or to facilitale, criminal
aclivily, including drug -related criminal activity, regardless of whether the individual engaging in such activity is a member of
the household or a guest.
D. The Resident or members of the household will not have in possession, angage in the manufacture, sale or dlstribullon of
illegal drugs at any Iocallon whether on or near community premises or otherwise.
E. The Resident, any member of the Resident's household, or guest or other parson under the Resident's control shall not
engage in acts of violence or threats of violence, including, but not limited to, the unlawful discharge of firearms, on or now
community premises.
F. Violation of the above provision shall be a material violation of the Lease and good cause for TERMINATION OF TENANCY.
A single violation of any of the above provision, shall be deemed a serious violation and a material noncompliance with the
Lease. Unless otherwise provided by law, proof of violation shall not require criminal conviction, but shall be by a
preponderance of the evidence.
29. DRUG FREE COMMUNITY:
Under California Landlord/Tenant Law, the use of your apartment for the Illegal sale of drugs and other controlled substances as
defined by the Penal Code and the Health and Safety Codes of the State of California is considered an incurable violation of terms
of the rental agreement and this section of the House Rules and will result In an immediate legal action for your eviction. The
possession, use, sale or distribution of Illegal drugs by you or any of your guests, visitors, friend or relatives in or about the
premises of the apartment complex will not be tolerated and will result in eviction. Any arrest made in your apartment for the use,
sale, distribution or delivery of illegal drugs will be considered grounds for an immediate eviction against your household.
30. CALIFORNIA DEPARTMENT OF JUSTICE PENAL CODE NOTIFICATION:
The California Department of Justice, sheriffs departments, police departments servicing jurisdictions of 200.000 or more and
many other local law enforcement aulhoritin maintain, for pudic access, a database of the locations of persons required to
register pursuant to paragraph (1) of subdivision (a) of Section 290.4 of the Penal Code. The database Is updated on a quavery
basis and Is a source of Information about the presence of these individuals in any neighborhood. The Department of Justice also
maintains a Sex Oflentlar Identification Line though which inquiries about specific individuals they are checking. Information
regarding neighborhoods is not available through the "900" telephone service.
31. CONTENTS OF THIS AGREEMENT:
This Agreemanl and its Attachments make up the entire Agreement between the Resident and Landlord regarding the unit. It any
court declares a particular provision of this Agreement to be invalid or illegal, all other leans of this Agreement will remain in effect
and both the Landlord and the Resident will continue to be bound by them.
32. ATTACHED TO THIS AGREEMENT:
The Residents listed in paragraph 1 of this agreement, certify they have received a copy of this Agreement and the following
Atachmants to this Agreement and understands that these Attachments are pan of this Agreement.
A. Attachment No. 1 —Unit Inspection Report. Initials _ Initials Initials - Initials
B. Attachment No. 2 —House Rules (If any). Initials _Initials _Initials _ Initials
33. AUTHORIZED RESIDENTS:
The following Individuals are the "only' authorized persons to reside in the unit.
34. SIGNATURES:
Signature of Head of Household:
Date:
Signature of Spouse or Co -Head:
- Date:
Signature of Other Resident:
Dale:
Signature of Other Resident:
Date:
Landlord(Aulhonzed Agent:
Date:
ut"t"'mmnou
52nd Drive Apartments
Rules and Regulations
The staff at 52ad Drive Apartments strive to make your living experience here pleasant
and comfortable. The following regulations were designed for your comfort and
convenience, as well as your neighbors. We wish to take this opportunity to tell you
about them:
"Premises" as used in the Rules and Regulations include not only the apartment but all
of the land and improvements including parking lots, driveways and common areas
privately owned by the Owner/Agent and generally referred to as the apartment
community.
SECTION A. PROPERTY/ MOVE -IN INFORMATION
1. Office Hours: The Rental Office is open on the days posted. Office hours are as
posted on the office and/or on the bulletin board. In case of emergency,
Management may be contacted after office hours via answering service/ pager
system.
2. Rent Collections: All rents are due and payable to Management at the Rental Office
on or before the first day of each month. Please make check or money order
payable to the apartment community. Cash payments are not accepted.
3. Late Charges: All rents are collected on the third (3`d) day of the month or thereafter
are subject to a late fee of as specified in your rental agreement. Rent is due on the
first day of the month. Late payment after the first day of the month is a courtesy and
should not be abused. Three late payments in a twelve (12) month period is
considered material non compliance for chronic late payment of rent.
Collection of Late Rent: The following step-by-step procedure will be used to collect
all rent in arrears:
a. A 3 or 10 Day Notice to Pay Rent or Quit will be served, depending on the
funding source at your community.
b. Unlawful Detainer Action will be initiated.
4. Returned / NSF Checks: if a Resident has one returned check, Resident will be
notified that Management will not accept any further personal checks, and rents
thereafter will have to be paid by money order or cashiers check. The returned
check must be paid for with a money order or cashiers check within 24 hours after
Resident's receipt of notice. Any check that is returned is subject to a $25.00
processing fee in addition to the late charge.
5. Lost Keys / Lockouts: Residents locked out after office hours will be charged a fee of
$25 to have their door opened or Resident may call a locksmith at resident's
expense to open the door. Locks will be changed for a fee of $25 per lock. Door and
mailbox keys must be returned to Management when Resident vacates.
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Resident's Initials
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6. Extended Absences: Resident should advise Management of any planned
absence for an extended period of time. "House -sitters" are not permitted without
prior written consent of management.
7. Mail and Newspapers: Only registered Residents are to receive mail. All mail must
contain the full address of your residence, which includes the apartment number as
well as the building number (if applicable). Unwanted or "throw -away" advertising
should be disposed of properly.
8. Apartment Inspection: Residents are required to accompany and assist the
Management staff in the completion of an apartment move -in inspection form. This
form is designed to record the condition of the apartment at the time of move -in and
to help determine the final disposition of the security deposit after terminating
residency. Bi-Annually, Management will enter each apartment for inspection and
will also check the smoke detector(s) and replace the air conditioner/heater air filter,
to properly maintain the unit's equipment. Each resident will be notified of the
inspections with a written notice 24 hours in advance.
Upon vacating, Resident is entitled to an inspection of the apartment to assess
move -out charges. Resident will be given a minimum of a 48-hour notice prior to the
inspection. Resident will have the right to be present for the inspection, approve for
management to conduct the inspection without being present, or waive the right to
the inspection.
9. Water Furniture: Waterbeds are permitted only in accordance with California law
which insurance protecting owner in an amount not less that $100,000, and an
increase in your deposit equal to one-half month's rent. Resident must also install,
maintain and dismantle the bed in accordance with industry standards. Resident
may not have on the premises an aquarium or any equivalent type of device with a
capacity in excess of ten (10) gallons without prior written consent of Landlord.
SECTION B: USE OF PREMISES:
10. Utility Service: Utility service must be maintained in resident's apartment, at
resident's expense AT ALL TIMES. Resident also agrees to cooperate with energy
conservation measures. Failure to maintain utility services or to cooperate with
energy conservation measures will be considered cause for termination of residency.
11. Smoke Detector: Smoke detection device has been installed in each apartment. It is
the Resident's responsibility during residency to periodically test the device.
Resident must inform the Management Representative immediately in writing of any
defect, malfunction or failure of any detector(s). Removing or tampering with a
smoke detector will be considered cause for termination of residency.
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12.1-Insafe Conditions: Resident agrees to report immediately to Management any
accident, injury, damage or loss, or need of service or repairs to water or gas pipes,
electrical writing, drains, toilets, fixtures, or any other property or equipment covered
by the lease, including all breakage, damage, or loss of any kind including but not
limited to water intrusion, water leaks or moisture problems of any kind, damage
from overflow of water from sinks, bathtubs, toilets, or other basins. Resident further
agrees to immediately notify Management of unsafe conditions in the common areas
and grounds of the premises which may lead to damage or injury.
13.Alterations or Additions: Resident shall not make any alterations or additions to the
premises. If any repairs, alterations or additions are necessary, Resident shall notify
Management in writing, Resident shall make no repairs, alterations, exterior
alterations include but are not limited to posting of signs, flags, plants on ledges and
wind chimes, addition to the dwelling structure inside or out without first obtaining
written consent from Management. American flags may be displayed within the laws
of the state and proper flag etiquette. Interior alterations include but are not limited
to, changing light fixtures, painting, hanging wallpaper, etc.
14.Qutward Appearance: Alterations that affect the apartment community's outward
appearance, such as installing personal window coverings, foil on windows, towels,
blankets or clothing draped over balconies or partitions is not permitted. Signs or
advertising materials will not be permitted to be posted. No foil, sign advertisements,
poster, or similar display, shall be affixed to any door, window or exterior wall that
may be visible from the outside of the building by other residents.
15.Antennas: The Federal Communications Commission states that Residents have a
limited right to install a satellite dish or receiving antenna within the leased premises.
Management is allowed to impose reasonable restrictions to such installation. All
requests for installation must be submitted to Management in writing. The rental
agreement must be amended to incorporate requirements and restrictions prior to
any installation. For information on requirements and restrictions, contact
Management. Resident shall not install any external television or radio reception
device nor climb or have others climb upon the roof. A separate deposit is required
prior to installation.
16. BBQs: Due to fire and other safety hazard concerns, no charcoal briquette barbeque
grills, gas or propane grills, cooking/heating instruments, smokers, hibachi grills,
portable gas stoves, electric coil grills, etc. are to be stored or operated in the
apartments or on patios, balconies or breezeway areas. Any use of open flame is
prohibited including but not limited to barbeques and torches.
17. Windows and/or Screens: Residents shall be responsible for replacement and/or
repair of windows and/or screens damaged or removed by resident, members of
Resident's household or guests.
18.Business: Resident shall not use the premises or permit their premises to be used
for any business purpose, without the prior written consent of Management.
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Updated 0013
19.Locks: Residents shall not alter any lock or install a new lock or knocker on any door
of the premises without the written consent of Management; and if installed, they
shall not be removed. In such case consent is given Resident shall provide
Management with a key for the use of Management, pursuant to Management's right
to access to the premises. Locks or chains must be left in place when Resident
vacates.
20. Equipment: No personal dish -washing machine, clothes washing machine, clothes
dryer or other large appliances is permitted in the apartment without prior written
consent of management.
21. Parcels: Resident is responsible for making arrangements for parcel delivery that
does not fit in the provided mail receptacle. Management representatives are not
authorized to sign for parcels. This includes parcels from UPS, Federal Express,
U.S. Postal Service or other mail and delivery services.
SECTION C: USE OF COMMON AREAS
22.The common area entrances, walkways, parking lots and landscaped areas shall not
be obstructed in any manner nor used for storage or any other purpose other than
that for which they were designed. No flea markets, yard sales, consuming alcoholic
beverages, etc. are permitted in the common areas.
23. Notices by Residents must be approved by Management and may be posted only in
the laundry rooms and only on the bulletin boards provided for that purpose.
Management will regulate and approve all items that are to be placed on the bulletin
boards.
24.The Community Room is provided for the exclusive use of the Community's
Residents and their accompanied guests. Most facilities are available when the
facility is open and are to be used at the Resident's own risk. Residents wanting to
use the Community Room for private parties may do so by reserving the room,
completing the Community Room Agreement, and placing a cleaning deposit. Any
person(s) creating a disturbance or using disorderly conduct in the Community
Room will be restricted from the area. Residents will be responsible for their
household members and guests at all times and liable for any and all damages to
the Community Room.
25.Nothing shall be placed or left overnight in the common area, nor shall any linen,
clothing, curtains, rugs, mops, or other items be shaken or hung on or any window,
door, railing, or balcony.
26. All flowerpots on the balconies and in apartments must have a drainage dish
underneath to prevent water damage. No plants may be placed on the railings.
27. Bicycles shall be stored only in the apartments or in the bicycle racks. Bicycle riding
is not allowed within the complex. This includes the walkways and grass areas.
Skateboard riding, scooter riding and rollerblading are also not allowed within the
complex, this includes walkways and parking lot areas.
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28. The mailbox area is to be kept clean and free from debris.
29. Management shall not be responsible for any item intended for delivery to a
Resident that are delivered to or left in any public area.
30.Nothing shall be swept or thrown out of windows or over balconies of the buildings.
Mops, brooms, towels, bicycles and similar items may not be left on
patios/balconies.
31.The patiolbalcony cannot be used as a storage area and must be kept in a clean
and sanitary condition at all times.
32.The open space around the building has been provided for your use and enjoyment.
Any activity that may damage the lawn, plantings, etc., is prohibited and any
damaged will be charged to the responsible Resident.
33.No items, including but not limited to, outdoor furniture or children's wading pools,
shall remain overnight in the common areas.
34.Management is not responsible for any lost or missing articles of Residents or
guests.
35.Great care should be taken when moving furniture on the premises. Any damage to
the premises will be charged to the responsible Resident. Damage to the premises
will be charged to the responsible Resident.
SECTION D: MAINTENANCE/DAMAGE
36.Emergencies: Emergencies affecting the premises should be promptly reported to
Management. Please report emergencies occurring after office hours to the
emergency number as posted at the Rental Office. Residents are cautioned to use
discretion in reporting emergencies after office hours, as only emergencies will
receive attention after regular hours.
37.Service Requests: Routine requests for maintenance will be given to Management in
writing whenever possible, including permission to enter in Resident's absence or a
request for appointment. Scheduled appointments will be set in a 4 hour window.
Management has the right to enter if Management believes. an emergency exists.
Resident agrees to promptly report need of service or repairs to the property or
equipment covered by the lease, including unsafe conditions in the common areas
and grounds of the premises that may be a threat to health and safety or lead to
damage or injury.
24. Sewer Stoppages: The sewer system is adequate to handle all normal waste, but
the system will not handle disposable diapers, feminine products or other such
refuse. Addition of toilet cleansing tabs can cause stoppage. Stoppages resulting
from alterations to equipment, addition of commercial deodorizer and/or resident's
negligence will be cleared at Resident's expense.
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Resident's Initials
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SECTION E: HOUSEKEEPING
25. Standards: Resident shall keep the interior of the apartment clean according to good
housekeeping standards. This includes maintaining all utility services. Resident will
assume full responsibility for keeping their patio, entry doors, entrance walkways,
porches, patios and balconies area cleaned, neatly arranged and free from unsightly
or unused items.
Resident shall keep the premises and such other areas as may be assigned for
Resident's exclusive use, including but not limited to, the apartment fixtures,
appliances, entry doors, windows and screens, sidewalks, parking space(s) and
grounds, in a clean, safe and sanitary condition. Resident shall refrain from shaking,
cleaning, hanging clothes, towels, rugs or other personal property from windows,
balconies or railings.
26. Prevention of Moisture Problems: Moisture -problems must be prevented and treated
immediately to prevent mold. Proper ventilation is essential for preventing mold. If
you should have mold develop on windows, walls, or ceilings, or a musty odor is
present in the carpeting, report these conditions to the rental office immediately
including the window tracks. Condensation, which develops on windows from indoor
moisture, must be wiped down immediately including the window tracks.
Condensation on windows indicates that fresh air is not being circulated in the home
to prevent moisture buildup. Open your windows and air out your home for short
periods of time to keep fresh air present. Excessive running of your heater will cause
condensation in your home. Report any running or dripping faucets, plumbing leaks,
roof leaks, discoloration of walls or water intrusion immediately to the rental office.
27. Pest Control: Resident shall report the need for pest control to Management.
Resident agrees to cooperate with the pest control service and abide by guidelines
given by the pest control service or management.
28. Health and Safety: Resident agrees to comply with all obligations imposed upon
Residents by applicable provisions of State and local building and housing codes
materially affecting health and safety, including maintaining adequate housekeeping
standards.
29.Storage: Garbage cans, bottles, brooms, mops, toys, bicycles, fitness equipment,
cardboard boxes, household furniture, and similar personal property are to be kept
inside the apartment or appropriately designated storage areas and out of view.
Patios and/or balconies are to be used for patio furniture only. Areas located outside
front doors or on stairway landings are part of the common area and cannot be used
for storage.
30.Smoking: Smoking is not permitted in the unit, common areas or grounds of the
community as a whole. Interference with other resident's rights to the enjoyment of
the premises as a result of smoking may be grounds for termination of residency.
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31.Household Odors: Resident acknowledges that odors caused by cooking or use of
strong chemicals will not interfere with other residents rights to the quiet enjoyment
of the premises. A resident agrees to utilize proper fans and ventilation when
cooking.
32.Trash: Resident shall deliver and place all garbage and trash in proper bins at
designated locations. If the bin you normally use is full, please use another bin. To
maximize available space, please break down large objects such as cardboard
boxes. Trash bins and/or enclosures are not to be used for large items such as
furniture, etc. Removal of large items, such as furniture, from the premises is
Resident's responsibility.
33. Recycling: Resident agrees to comply with all present and future laws, orders and
regulations of all state, federal, municipal and local governments regarding the
collection, sorting, separating and recycling of waste products, garbage, refuse and
trash.
SECTION F: SUPERVISION HOUSEHOLD MEMBER/ VISITORS/ GUESTS
34.Guests: Guests staying in excess of 72 hours must register with the office. Resident
may be permitted to have a guest(s) visit their household. However, any adult
person(s) making reoccurring visits or one continuous visit of 14 days and nights in a
45 day period without consent of Management is a violation of the lease. Persons
receiving mail to the premises will be considered occupants. All adult household
members must submit a completed application and qualify for residency.
35.Supervision: Resident agrees that Resident is responsible for the conduct of any
member of their household, visitors and guests, and agrees to pay for any damage
to the premises caused by member of household or guests. Resident shall prevent
household members or guests from tampering, in any way, with the landscape,
sprinkler system or plants, shrubbery, trees or equipment that is appurtenant to the
premises.
36. Walkways: Resident shall not store nor allow any personal household property
outside the apartment in a manner that may be detrimental to the appearance of the
premises or interfere with free passage upon any street or sidewalk in the premises.
Walkways are for pedestrian use. No bicycling, roller skating or in -line skating,
skateboarding, coaster riding, etc. is allowed on walkways. Walkways are to be kept
clear of toys, bicycles, etc.
37. Wading Pools: Use of wading pools on the premises is prohibited.
SECTION G: CONDUCT
38.Loitering: Residents, household members or guests shall not loiter outside the
apartments, after 10:00 PM Residents shall conduct themselves, and cause other
persons who are on the premises with their consent to conduct themselves in a
manner, which will be conductive to maintaining the premises in a decent, safe, and
sanitary condition; and to promote the quiet enjoyment of the premises for all
residents. Resident will not make, or cause to be made, or permit any disturbance or
loud noises in or on the premises, street, or common areas.
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39.Noise: Residents, household members and guests shall not make or allow to be
made any disturbing noises upon the premises by Resident, household members or
guests, etc., nor permit anything to be done by such persons that will interfere with
the rights, comforts, or convenience of other Residents. Residents, household
members and guests are advised to take care when approaching and leaving their
apartment during the quiet time between the hours of 10:00 pm and the following
8:00 am and show consideration of other residents at all times. No Resident shall
play upon or allow to be played upon, any musical instrument or operate or allow to
be operated audio equipment, radio, or television in or on the premises between the
hours of 10:00 pm and the following 8:00 am, if the same shall disturb or annoy
other occupants of the Apartment Community.
40.Threats / Offensive Conduct: To assist in ensuring the safety and quiet enjoyment of
all tenants, Residents, household members and guests shall not engage in offensive
conduct or language on or about the premises. Resident, all members of the
Resident's household and guests shall not cause or threaten to cause serious
physical injury to another person on the premises, or be involved in a fight while on
the premises; commit abuse upon any person on the premises, and will abstain from
any activity which impairs the physical or social environment of the premises.
41.Alcohol / Public Intoxication: Resident shall not, and Resident shall take reasonable
action to prevent all members of Resident's household and guests from, drinking
alcoholic beverages or using illegal substances in or on common areas, walkways or
streets of the premises, or in vehicles parked or moving on the premises.
42.Illegal Activity: Resident, any member of the Resident's household, or a guest or
other person under the Residents control shall not engage in illegal or criminal
activity, nor in any act intended to facilitate illegal or criminal activity, including gang
or drug -related illegal or criminal activity, on or near the premises. Resident, all
members of the Resident's household and guests shall not engage in the
manufacture, sale, or distribution of illegal drugs or be under the influence of any
controlled or, illegal substance at any location, whether on or near the premises or
otherwise, nor permit the dwelling unit to be used for, onto facilitate, any illegal or
criminal activity.
43.Acts of Violence: Resident or members of the household or guests shall not engage
in any acts of violence including but not limited to the display of brandishing, or using
in a threatening manner, any dangerous weapons or objects in or about the
premises. Resident shall not keep or use on or about the premises or project any
explosive, flammable, or repellent device, or otherwise dangerous device, and to
take every care and precaution to prevent fires.
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SECTION H: VECHICLES:
44.Parking / Speed Limits: Resident shall observe, and cause all members of
Resident's household and guests to observe, the posted speed limits on drives in
the premises, to park and cause members of Resident's household and guests to
park only in assigned parking areas; not to block access for emergency vehicles, or
to other residences, and not drive, or park any vehicle on the lawn, driveway, or
other areas for common use in the premises. Resident agrees that any vehicle that
is improperly parked, or in violation of vehicle or parking policies without written
permission of Management may be removed at the expense of the vehicle's owner.
Assigned Parkina: Residents will have assigned parking space(s), that is be used by
the registered vehicle.
45.Vehicle Registration: Resident shall register all household vehicles with
Management. Resident agrees to provide vehicle information (licenses number,
make, model, etc.) and provide updated information in the event of changes.
Vehicles on the premises must be currently registered and properly insured
according to state law.
46. Motorcycles / Trailers / Boats / RVs: Motorcycles are considered vehicles and must
be parked in an appropriately designated parking space. Motorcycles may not be
parked on the sidewalks, in stairwells, on patios, on porches or in any other area not
designated for the parking of vehicles. No recreational vehicles, trailers or boats are
allowed on the premises except with written consent on Management.
47.Inoperable Vehicles: Vehicle maintenance on the premises is prohibited. Residents
and/or guests shall not park vehicles in a state of disrepair on premises. This
includes operational vehicles leaking on parking surfaces. Leaks and spills and/or
damages caused by same are the responsibility of Resident. The owner of any
vehicle that leaks oil in the parking lot will be held responsible for clean-up and/or
damage charges. Non -operable vehicles may be removed at the expense of the
vehicles owner.
48.Washing Vehicles: Residents may wash or spray off vehicles only in designated
areas of the premises. Resident will make every effort to not waste water if a
designated area exists. If no designated area exists, Residents may not wash or
spray off vehicles anywhere on the premises.
SECTION I: PETS:
49. Pets: No pets are allowed in the apartment community.
SECTION J: MOVE -OUT INFORMATION:
50. Personal Property: Resident agrees to remove all personal property when vacating
the premises. All personal property left on the premises when the apartment is
vacated shall be deemed to be property abandoned by Resident and may be
disposed of according to law. All personal property removed from the premises at
the time of physical eviction of Resident shall deemed abandoned if not claimed with
the time prescribed by law, and may be disposed of by Management according to
law thereafter.
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Updated 02J13
51. Move -out Charges: Residents will be charged for damage to the apartment beyond
"normal wear and tear". Repair and replacement damages will be determined by
Management. Please see your Check-in/Check-out sheet for additional information
concerning this matter.
SECTION K: HOLD HARMLESS AND WAIVER:
52.Deposits: Deposits will be refunded when ALL keys are returned and premises are
vacated and the apartment is lift in the same general condition as when first
occupied, with the exception of normal wear and tear, in accordance with state law.
53.Insurance: No insurance is provided by Management for Resident's personal
property or additional living expenses. Resident agrees to indemnify and hold
Management harmless and in no way accountable for any liability for personal injury
or property damage caused or permitted by Resident or any other person on the
premises with Residents consent except as may be caused by the negligence of
Management. The Residents hereby advised and understand that the personal
property of the Resident is not insured by the Management for either damage or
loss, and the Management assumes no liability for any such loss.
Management recommends that the resident secure insurance to protect
him/herself and his/her property.
Management recommends resident maintain at their expense a standard type
of renters homeowner insurance policy or its equivalent, issued by a licensed insurance
company of resident's selection which provides limits of liability of at lease $25,000
personal liability.
In accordance with Provision #16 of the Lease Agreement, these Rules and
Regulations are part of your Lease Agreement.
Resident Signature
Resident Signature
Resident Signature
Resident Signature
Management Representative
Page 10 of 10
Date
Date
Date
Date
Date
Resident's Initials
Updated 02/13
4675 52nd Drive
OPERATING EXPENSES
Year 1
2015
Expenses:
Salaries & Benefits
Manager $ 33,000
Employee Apartment $ 15,506
Employee Burden $ 9.240
Total Salaries & Benefits $ 57,746
Administrative
$
4,000
Advertising/Marketing
$
2.000
Repairs & Maint.
Maintenance Manager
$
20,000
Painting & Cleaning
$
11,250
Repairs & Maint.
$
11,250
Total Admin, Repairs & Mainten $
48.500
Contract Services
Fire Sprinkler/Alarm Service
$ 2,000
Trash
$
9,720
Pest Control
$
3,500
Landscape/Grounds Maintenance
$
9,600
Security Monitor
$
2,500
Total Contract Services
$
27,320
Utilities
Electric
$
14,625
Water & Sewer
$
14,850
Gas
$
13,950
Total Utilities
$
43,425
Management Fees
$
26,813
Legal/Audit
$
11,000
Real Estate Taxes
$
2,000
Insurance
$
12,375
Replacement Reserves
$
13,500
Activity Fee
$
15,000
Total Other
$
80,688
Total Expenses
$
257,680
ATTACHMENT NO.9
RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:
City of Vernon
4305 Santa Fe Avenue
Vernon, California 90058
Attn: City Clerk
This document is exempt from the payment of a recording fee
pursuant to Government Code Sections 6103 and 27383
REGULATORY AGREEMENT
THIS REGULATORY AGREEMENT (the "Agreement") is entered into as of
,201 by and between the CITY OF VERNON, a California
charter city and municipal corporation (the "City"), and [META HOUSING CORPORATION
ENTITY], a California limited partnership (the "Developer").
RECITALS
A. Pursuant to a "Ground Lease" between City and Developer dated
201 , Developer has ground leased from the City certain real property located within the City
of Vernon, as particularly described in the Legal Description attached hereto as Exhibit A, which
is incorporated herein by reference (the "Site").
B. Developer desires to construct a forty-five (45) unit multifamily affordable
housing development on the Site (the "Housing Development"), and to make available and rent
the apartment units within the Housing Development (the "Housing Units') for extremely low,
very low and lower income persons at an affordable rent.
C. Developer and City have entered into a Disposition and Development Agreement
(the "DDA") dated as of February 19, 2013. Subject to the terms and conditions therein, the
Developer has agreed to lease the Site and construct and operate the Housing Development, and
the Developer has agreed to make available and lease two (2) of the Housing Units to Extremely
Low Income Households, fourteen (14) of the Housing Units to Very Low Income Households,
and six (6) of the Housing Units to Lower Income Households, all at an Affordable Rent (as
those terms are defined herein). The execution and recording of this Agreement is a requirement
of the DDA and the Ground Lease.
Attachment No. 9-1
1017942.5
NOW, THEREFORE, the parties hereto agree as follows:
1. Number of Affordable Units. Developer agrees to make available, restrict
occupancy to, and rent two (2) of the Housing Units to Extremely Low Income Households,
fourteen (14) of the Housing Units to Very Low Income Households, and six (6) of the Housing
Units to Lower Income Households, all at an Affordable Rent (the "Affordable Units").
For purposes hereof:
"Extremely Low Income Household" means an annual gross income that does not exceed
the qualifying limits, adjusted for household size and other factors, for an "extremely low-
income family" as defined under the United States Housing Act of 1937 as amended, and as
determined from time to time by HUD for the Los Angeles Metropolitan Statistical Area. If
HUD should cease making such determination, "extremely low income" shall be defined as equal
to or less than 30% of Area Median Income, or City in its reasonable discretion may designate
another definition of "extremely low income" used by any other federal or state agency.
"Lower Income Household" means an annual gross income that does not exceed the
qualifying limits, adjusted for household size and other factors, for a " low-income family" as
defined under the United States Housing Act of 1937 as amended, and as determined from time
to time by HUD for the Los Angeles Metropolitan Statistical Area. If HUD should cease making
such determination, "low income" shall be defined as equal to or less than 60% of Area Median
Income, or City in its reasonable discretion may designate another definition of "low income"
used by any other federal or state agency.
"Very Low Income Household" means an annual gross income that does not exceed the
qualifying limits, adjusted for household size and other factors, for a 'very low-income family"
as defined under the United States Housing Act of 1937 as amended, and as determined from
time to time by HUD for the Los Angeles Metropolitan Statistical Area. If HUD should cease
making such determination, 'very -low income" shall be defined as equal to or less than 50% of
Area Median Income, or City in its reasonable discretion may designate another definition of
"very -low income" used by any other federal or state agency.
2. Duration of Affordability Requirements. The Affordable Units shall be subject
to the requirements of this Agreement for the entire term of the Ground Lease, as it may be
extended. The duration of this requirement shall be known as the "Affordability Period."
3. Household Income Requirements. Developer shall obtain, or shall cause to be
obtained by the Property Manager, a certification from each household leasing an Affordable
Unit demonstrating that such household is an Extremely Low Income Household, Very Low
Income Household or Lower Income Household, as applicable, and meets the eligibility
requirements established for the Housing Unit. Developer shall verify, or shall cause to be
verified by the Property Manager, the income certification of the household.
Attachment No. 9-2
1017942.5
4. Affordable Rent. The maximum Monthly Rent chargeable for the Affordable
Units shall be annually determined in accordance with the following requirements. The Monthly
Rent for the Affordable Units to be rented to Extremely Low Income Households shall not
exceed the maximum rent allowable under Section 42 of the Internal Revenue Code and the rules
and regulations implementing the foregoing (the "Tax Credit Rules") for a tenant earning thirty
percent (30%) of the Los Angeles County area median income for a household size appropriate
to the unit. The Monthly Rent for the Affordable Units to be rented to Very Low Income
Households shall not exceed the maximum rent allowable under the Tax Credit Rules for a
tenant earning fifty percent (50%) of the Los Angeles County area median income for a
household size appropriate to the unit. The Monthly Rent for the Affordable Units to be rented
to Lower Income Households shall not exceed the maximum rent allowable under the Tax Credit
Rules for a tenant earning sixty percent (60%) of the Los Angeles County area median income
for a household size appropriate to the unit.
For purposes of this Agreement, "Monthly Rent" means the total of monthly payments for
(a) use and occupancy of each Affordable Unit and land and facilities associated therewith, (b)
any separately charged fees or service charges assessed by the Developer which are required of
all tenants, other than security deposits, (c) a reasonable allowance for an adequate level of
service of utilities not included in (a) or (b) above, including garbage collection, sewer, water,
electricity, gas and other heating, cooking and refrigeration fuels, but not including telephone
service, and (d) possessory interest, taxes or other fees or charges assessed for use of the land
and facilities associated therewith by a public or private entity other than Developer. In the
event that all utility charges are paid by the landlord rather than the tenant, no utility allowance
shall be deducted from the rent.
5. Site Management Plan; Property Management. The Developer has prepared a
"Site Management Plan" which sets forth in detail the Developer's property management duties,
a marketing plan, a tenant selection process, a security system and crime prevention program, the
procedures for the collection of rent, the procedures for eviction of tenants, the rules and
regulations of the Housing Development and manner of enforcement, a standard lease form, an
operating budget, the identity of the manager of the Housing Development (the "Property
Manager"), the resident services program to be provided pursuant to Section 7 hereof, and other
matters relevant to the management of the Housing Development. The Site Management Plan
shall prohibit the Property Manager from lobbying, influencing, or attempting to influence any
residents of the Housing Development or other registered voters of the City with respect to any
matters which require the approval of the City or the electorate of the City. Any violation of this
Section 706 shall be deemed a material breach of this Agreement.
. The Site Management Plan is attached to the DDA as Attachment No. 8 and
incorporated herein. The Site Management Plan may be revised from time to time with the
approval of the City. The management of the Housing Development shall be in compliance with
the Site Management Plan which is approved by the City.
If the City determines that the performance of the Property Manager is deficient based
upon the standards set forth in the Site Management Plan and in this Agreement, the City shall
provide notice to the Developer of such deficiencies, and the Developer shall use its best efforts
to correct such deficiencies. In the event that such deficiencies have not been cured within the
Attachment No. 9-3
1017942.5
time set forth in the Ground Lease, the City shall have the right to require the Developer to
immediately remove and replace the Property Manager with another property manager or
property management company which is reasonably acceptable to the City, which is not related
to or affiliated with the Developer, and which has not less than five (5) years experience in
property management, including significant experience managing housing facilities of the size,
quality and scope of the Housing Development.
6. Selection of Tenants. Developer shall be responsible for the selection of tenants
for the Housing Units in compliance with lawful and reasonable criteria, as set forth in the Site
Management Plan, and according to a system which provides an agreed upon priority for persons
employed or residing in the City of Vernon or within a 1 mile radius as measured from the center
of the Site. The Site Management Plan shall include a system for the random selection of tenants
from a pool of applicants. Tenants shall meet criteria which is reasonable and customary for
similar multifamily developments. Tenant selection shall be made in an open and public manner.
The tenant selection system in the Site Management Plan shall be designed to prevent favoritism
and outside influences of any kind in the selection process. The tenant selection system shall
provide for due diligence by Developer in evaluation of the applications for eligibility criteria,
including the basis of any requested priority. Representatives of the City shall be entitled to
enter, inspect the records of, and audit the Housing Development with respect to the tenant
selection process as provided in Section 14 hereof. Any violation of the tenant selection system
shall be deemed a material breach of this Agreement,
7. Resident Services. At all times during the Affordability Period, Developer shall
provide, or cause to be provided, activities and programs appropriate to the needs of the residents
of the Housing Development, with the selection of such activities and programs to be determined
by Developer in collaboration with the residents of the Housing Development. The specific
types of social services to be provided shall be submitted to and approved by the City, and may
be revised with the prior approval of the City, which approval shall not be unreasonably
withheld. The annual cost of resident services shall be not less than $15,000, as adjusted
annually by the increase in the CPI during the previous 12 month period.
S. Maintenance. The Developer shall maintain the Housing Development or cause
it to be maintained in a decent, safe and sanitary manner, and in accordance with the standard of
maintenance of first class apartment units within Los Angeles County, California. If at any time
Developer fails to maintain the Housing Development in accordance with this Agreement and
such condition is not corrected within five days after written notice from the City with respect to
graffiti, debris, and waste material, or thirty days after written notice from the City with respect
to general maintenance, landscaping and building improvements, then the City, in addition to
whatever remedy it may have at law or at equity, shall have the right to enter upon the applicable
portion of the Housing Development and perform all acts and work necessary to protect,
maintain, and preserve the Housing Development, and to attach a lien upon the Housing
Development, or to assess the Housing Development, in the amount of the expenditures arising
from such acts and work of protection, maintenance, and preservation by the City and/or costs of
such cure, including a reasonable administrative charge, which amount shall be promptly paid by
Developer to the City upon demand.
Attachment No. 9-4
1017942.5
9. Capital Reserve Requirements. The Developer shall also, or cause the Property
Manager to, annually set aside an amount of Three Hundred Dollars ($300) per Housing Unit (or
such larger amount as may be required by a Housing Development lender), from the gross rents
received from the Housing Development, into a separate interest -bearing trust account in the
name of the Developer (the "Capital Replacement Reserve"); provided, however, to the extent
the Developer is required by any lender to maintain a separate account to hold deposits for
capital reserves, the amount of such deposits shall be credited towards Developer's obligations
under this section. Such amount shall be adjusted annually by the Consumer Price Index of the
Bureau of Labor Statistics of the U.S. Department of Labor for All Urban Consumers, Los
Angeles — Riverside — Orange County, California (all items), 1982-84 = 100, or its successor
index (the "Consumer Price Index"). Funds in the Capital Replacement Reserve shall be used
for capital replacements to the Housing Development fixtures and equipment which are normally
capitalized under generally accepted accounting principles. The non -availability of funds in the
Capital Replacement Reserve does not in any manner relieve the Developer of the obligation to
undertake necessary capital repairs and improvements and to continue to maintain the Housing
Development in the manner prescribed herein. Not less than once per year, Developer, at its
expense, shall submit to the City an accounting for the Capital Replacement Reserve. Capital
repairs to and replacement of the Housing Development shall include only those items with a
long useful life, including without limitation the following: carpet and drape replacement;
appliance replacement; exterior painting, including exterior trim; hot water heater replacement;
plumbing fixtures replacement, including tubs and showers, toilets, lavatories, sinks, faucets; air
conditioning and heating replacement; asphalt repair and replacement, and seal coating; roofing
repair and replacement; landscape tree replacement; irrigation pipe and controls replacement; gas
line pipe replacement; lighting fixture replacement; common area furniture replacement;
common area repainting, and uninsured losses due to casualties such as earthquakes.
10. Relationship to Tax Credit Requirements. Notwithstanding any other
provisions of this Agreement, to the extent that the regulatory agreement executed by the
Developer as a requirement of receiving the Tax Credits (the "Tax Credit Regulatory
Agreement") is less restrictive with respect to the requirements applicable to tenant selection,
tenant income levels and unit rent levels than as provided in this Agreement and the DDA, this
Agreement and the DDA shall control.
11. Prohibited Uses. None of the Housing Units in the Housing Development shall
at any time be utilized on a transient basis, nor shall the Housing Development or any portion
thereof ever be used as a hotel, motel, dormitory, fraternity or sorority house, rooming house,
hospital, nursing home, sanitarium or rest home.
12. Non Discrimination Covenants. Developer covenants by and for itself, its
successors and assigns, and all persons claiming under or through them that there shall be no
discrimination against or segregation of any person or group of persons on account of race, color,
religion, sex, marital status, familial status, disability, national origin, or ancestry in the sale,
lease, transfer, use, occupancy, tenure, or enjoyment of the Housing Development, nor shall
Developer itself or any person claiming under or through it, establish or permit any such practice
or practices of discrimination or segregation with reference to the selection, location, number,
use or occupancy of tenants, lessees, or vendees in the Housing Development.
Attachment No. 9-5
1017942.5
13. Naming Rights. City shall have the exclusive non-commercial right to select the
name of the Housing Development in its sole discretion to honor one or more civic or business
leaders, as the City Council may designate. Developer agrees to cooperate in the placement of a
suitable monument or other feature to memorialize this honor, at the City's expense. Developer
shall use the name selected by City on all exterior and interior project signage, written materials
and letterhead, leases and other project documents, and shall verbally refer to the Housing
Development by the selected name. The parties shall jointly agree in advance on the scheduling
of any official naming ceremonies, and the press announcements regarding such ceremonies, and
both parties shall have the right to participate in any such naming ceremonies.
14. Monitoring and Recordkeeping. Throughout the Affordability Period, prior to
April 15 of each year, Developer shall annually complete and submit to City an audited financial
statement for the Housing Development and a report which includes (i) the name, address,
income and household size of each occupant of an Affordable Unit during the prior year,
identifying the bedroom count and Monthly Rent for such Affordable Unit, (ii) an identification
of vacancies of Affordable Units during the prior year, (iii) the amount deposited into reserve
accounts in the prior year, (iv) the amount and purposes of all expenditures of reserve accounts
during the prior year, (v) the current balance of reserve accounts, (vi) an operating budget for the
current year, (vii) a detailed accounting of operating expenditures in the prior year, and (viii) a
description of and cost of social service programs conducted in the prior year. City agrees that
the Developer may submit reporting forms prepared and submitted in connection with the Tax
Credits, to the extent those forms contain the information required hereunder. Representatives of
the City shall be entitled to enter the Housing Development, upon at least forty-eight (48) hours
prior written notice, to monitor compliance with this Agreement, to inspect and make copies of
the records of the Housing Development, and to conduct an independent audit or inspection of
such records. The Developer agrees to cooperate with the City in making the Housing
Development available for such inspection or audit. Developer agrees to maintain records in
businesslike manner, and to maintain such records for the term of this Agreement.
15. Compliance with Laws and DDA. The Developer shall carry out the operation
of the Housing Development in conformity with the DDA and all applicable laws, including all
applicable state labor standards, City zoning and development standards, building, plumbing,
mechanical and electrical codes, and all other provisions of the City Municipal Code, and all
applicable disabled and handicapped access requirements, including without limitation the
Americans With Disabilities Act, 42 U.S.C. Section 12101, et seq., Government Code Section
4450, et seq., Government Code Section 11135, et seq., and the Unruh Civil Rights Act, Civil
Code Section 51, et seq.
16. Successors and Assigns. This Agreement shall run with the land, and all of the
terms, covenants and conditions of this Agreement shall be binding upon the Developer and the
City and the permitted successors and assigns of the Developer and the City. Whenever the term
"Developer," or "City" is used in this Agreement, such term shall include any other successors
and assigns as herein provided.
17. No Third Party Beneficiaries. This Agreement is made and entered into for the
sole protection and benefit of the City and its successors and assigns, and Developer and its
successors and assigns, and no other person or persons shall have any right of action hereon.
Attachment No, 9-6
1017942.5
18. Partial Invalidity. If any provision of this Agreement shall be declared invalid,
illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions
hereof shall not in any way be affected or impaired.
19. Governing Law. This Agreement and the documents and other instruments
given pursuant hereto shall be construed in accordance with and be governed by the laws of the
State of California. Any references herein to particular statutes or regulations shall be deemed to
refer to successor statutes or regulations, or amendments thereto.
20. Amendment. This Agreement may not be changed orally, but only by agreement
in writing signed by Developer and the City.
21. Notices. Any approval, disapproval, demand, document or other notice
("Notice") which either party may desire to give to the other party under this Agreement must be
in writing and may be given either by (i) personal service, (ii) delivery by reputable document
delivery service such as Federal Express that provides a receipt showing date and time of
delivery, or (iii) mailing in the United States mail, certified mail, postage prepaid, return receipt
requested, addressed to the address of the party as set forth below, or at any other address as that
party may later designate by Notice.
To City: City of Vernon
4305 Santa Fe Avenue
Vernon, California 90058
Attention: City Administrator
Copy to: City Attorney
Copy to: City Director of Community Services and Water
To Developer: [Limited Partnership]
c/o Meta Housing Corporation
1640 A. Sepulveda Blvd., Suite 425
Los Angeles, CA 90025
Attention: John Huskey
With copy to: Bocarsly, Emden, Cowan, Esmail & Arndt, LLP
633 West Fifth Street, 70th Floor
Los Angeles, CA 90071
Attention: Nicole Deddens
With copy to:
Any written notice, demand or communication shall be deemed received
immediately upon receipt; provided, however, that refusal to accept delivery after reasonable
attempts thereto shall constitute receipt. Any notices attempted to be delivered to an address
from which the receiving party has moved without notice shall be effective on the third day from
the date of the attempted delivery or deposit in the United States mail.
Attachment No. 9-7
1017942.5
IN WITNESS WHEREOF, the parties hereto have executed this Regulatory Agreement
effective as of the date and year set forth above.
CITY:
CITY OF VERNON, a California charter city and
municipal corporation
0
ATTEST:
City Clerk
APPROVED AS TO FORM:
Nicholas George Rodriguez,
City Attorney
Kronick Moskovitz Tiedemann & Girard,
Special Counsel to City
Attachment No. 9-8
1017942.5
DEVELOPER:
[META HOUSING CORPORATION LIMITED
PARTNERSHIP]
Attachment No. 9-9
1017942.5
Exhibit "A"
LEGAL DESCRIPTION OF PROPERTY
That real property located in the City of Vernon, County of Los Angeles, State of California, described as
follows:
Lot Nos. 45 through 53 of Tract No. 7923
APN: 6314-002-900 (portion)
Attachment No. 9-10
Exhibit A
1017942.5
STATE OF CALIFORNIA
COUNTY OF
On before one, , 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
Attachment No. 9-11
Exhibit A
1017942.5
(Seal)
STATE OF CALIFORNIA
ss
COUNTY OF
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 acluiowledged 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
Attachment No. 9-12
Exhibit A
1017942.5
(Seal)
CITY CLERK'S OFFICE
INTEROFFICE MEMORANDUM
DATE: February 25, 2013
TO: S. Kevin Wilson, Director of Community Services & Water
FROM: Deborah Juarez, Records Management Assistant
RE: Resolution No: 2013-33 — A Resolution of the City Council of the City of Vernon
Approving a Disposition and Development Agreement by and Between the City of Vernon
and Meta Housing Corporation
Transmitted herewith is a copy of Resolution No. 2013-33 referenced above, which was approved by City
Council on February 19, 2013.
Thank you.
Attachment
c: Resolution No. 2013-33
RECEIVED
RECEIVES y` JAN 3 1 2013
JAN 31 2013 ���» e ��� CITY ADMINISTRATION
CITY CLERK'S,OFFICE STAFF REPORT
Community Services and Water
DATE: February 5, 2013
TO; Honorable Mayor and City Council
4elj
FROM: Samuel Kevin Wilson; Director of Community Services and Water
RE; Approval of Resolutions rind Ordinances Updating the General Plan Land
Use and Housing Elements, amending the Zoning Code, Approving a
Development Agreement with Meta Housing Corporation, and. approving a
Mitigated Negative Declaration
Recommendation
The Projecteo'llect'ively includes: the proposed,45 Unit Affordable Housing Development at•4675
52"d Drive, the Associated Development Agreement and Disposition And Development
Agreement, Proposed General Plan Amendments and Zoning Ordinance and Map Amendments,
It is recommended that in accordance with the California Environmental Quality Act, contained
in Public Resources Code commencing at Section;21000 and the California Code of Regulations,
Title 14, Chapter 3, City Council adopt a Mitigated Negative Declaration subject to the
mitigation measurescontainedin the Mitigation Monitoring Reporting Program for the project.
It is also recommended that the .mitigation monitoring Reporting Program contained in
Attachment 1 be approved. It is further recommended that the City Clerk of the City of Vernon
shall be designated as the custodian of all documents or other materials which constitute this
record of proceedings upon which this decision is made.
It is recommended that the City Council adopt a resolution amending the Land Use Element and
the Housing Element of the General Plan to allow the construction of residential housing units
and an emergency shelter within specified zones of the City. Adopt an ordinance amending the
Citys' Zoning Ordinance and Map setting forth the overlay zones where residential housing and
an emergency shelter would be permitted and establishingcriteria for the construction of the
housing units and emergency shelter.
Lastly, it is also recommended that the City Council approve a Development. Agreement with
Meta Housing Corporation for the construction of residential housing units to be located at4675
52"d Drive in the City of Vernon. A Disposition and Development Agreement will also be
presented to the City Council at the February 19, 2013 City Council meeting.
Backaround
To institute improved governance practices that include expanding the voting population in
Vernon the City intends to amend its General Plan and Zoning Ordinance to permit the
construction of additional housing within the City of Vernon. Additionally City Staff is
recommending that the City enter into a Development Agreement ("DA") and Disposition and
Development Agreement ("DDA") to permit Meta Housing Corporation to construct a 45 unit
apartment complex on the City owned property located at 4675 52"d Drive in the City of Vernon.
Update to General Plan Elements
To allow the housing development project to move forward, amendments to the General. Plan
Land Use and Housing Elements will be required. In addition, amendments to the General Plan
will be made to reflect current State law as described below.
Amendment to the Land Use Element
Two new overlay districts are proposed to be added to the Land Use Element: the Housing
Overlay and the Emergency Shelter Overlay. Each of these overlay districts apply to specific
sites in the City that have been identified as most suitable for these uses (see Exhibit 1). Pursuant
to proposed revised land use policy, the Housing Overlay would permit up to an additional 60
units in the City of Vernon.
Housing Overlay District
As part of the project, thej proposed amendment to the Land Use Element states that the
Housing Overlay District may be applicable only to sites that have been specifically
identified by the City and determined to be the best locations for housing, given surrounding
uses, proximity to services and amenities, and distance from safety hazards. Residential uses
are permitted in this district only pursuant to the terms of a Development Agreement, given
the unique safety constraints in Vernon.
Emergency Shelter Overlay District
Pursuant to S132, codified in Government Code Sections 65582, 65583, and 65589.5e, the
City is required to accommodate emergency shelters by right in at least one zone. To
implement this law, the City proposes to establish the Emergency Shelter Overlay District,
which will apply only to sites that have been specifically identified by the City and
determined to be appropriate locations for emergency shelters.
Housing Element
State law requires that the Housing Element be updated at least every eight years, on a timeline
consistent with the Regional Transportation Plan, unless extended by the legislature. Article
10.6, Section 65580-65589.8, Chapter 3 of Division I of Title 7 of the Government Code sets
forth the legal requirements for a housing element, and. encourages the provision of affordable
and decent housing in suitable living environments for all communities to meet statewide goals.
The 2014-2021 Housing Element update is a policy document that outlines the City's current and
projected future housing needs (as identified by the State Housing and Community Development
Department, or HCD) and the Southern California Association of Governments (SCAG), and the
City's goals, policies, and programs to address those identified needs. Specifically, the element
details:
0 Population characteristics and trends
• Employment characteristics
• The types of households in Vernon
• Special needs populations
• Housing characteristics and trends
• Constraints on the development of new housing
• Housing resources (available vacant and underutilized sites, financial resources)
• How the City will work to meet the Regional Housing Needs Assessment (RHNA)
allocation assigned by SCAG and otherwise achieve housing goals
Given Vernon's status as an industrial city, the Housing Element has, in the past, promulgated
the policy that no new housing will be constructed in Vernon due to the safety risks posed by the
multitude of industries operating there, including many that involve the use, transport, and
production of hazardous materials. The proposed 2014-2021 Housing Element revises that policy
and identifies two potential sites for housing development that have been deemed most suitable.
One of these sites (4675 52nd Drive) is also designated with a Housing Overlay in the Land Use
Element. The Housing Element also addresses new State laws, including SB 2 (codified as
Government Code Section 65583[a][4]), which requires jurisdictions to identify a zone in which
to permit emergency (homeless) shelters by right. The Housing Element identifies an area
designated with an Emergency Shelter Overlay in the General Plan and Zoning Ordinance.
The State Department of Housing and Community Development (HCD) has reviewed the draft
element to determine whether it meets the requirements of State law, and has determined that the
Element is compliant.
Update to Zoning Ordinance and Zoning Map
The City has drafted revisions to the Zoning Ordinance to achieve consistency with proposed
Land Use Element Overlay Districts and the goals, policies, and implementation measures
specified in the General Plan. These revisions include a new Housing Overlay District and
Emergency Shelter Overlay District and related use and development standards, as well as
required findings for these new overlays. Additionally, a new Procedures section has been
created to establish the Development Agreement process as the method for allowing new
housing development. Further, the Amendment incorporates multiple new definitions related to
these amendments.
The Zoning Map is proposed to be amended to identify locations for the Housing and Emergency
Shelter Overlay districts. The Housing Overlay District is proposed to apply to one vacant parcel
located on the east side of the City (4675 52"d Drive). The Emergency Shelter Overlay District is
proposed to apply to a single vacant parcel located in the northwest comer of the City (see Figure
1).
Proposed Residential Project at 4675 52nd Drive
To institute improved governance practices that include expanding the voting population in
Vernon, the City has identified a site at 4675 52"d Drive as appropriate for a new housing
development. The parcel is owned by the City of Vernon. To meet agreed -upon deadlines (with
the State legislature) for achieving new housing development in Vernon, the City issued a
Request for Proposals on April 19, 2012 for housing development on this 2.06-acre site.
Proposals were received in July 2012, all of which proposed exclusively residential use yielding
between 31 and 61 units.
All development proposals were considered. The proposal from Meta Housing Corporation was
selected as most appropriate. The proposal would provide for 45 units. This component of the
project would include project entitlements consisting of a Development Agreement, as required
pursuant to proposed Zoning Ordinance regulations for the new Housing Overlay Zone.
The proposed rental housing development would include nine one -bedroom units, 22 two -
bedroom units, and 14 three -bedroom units. At least 22 units would be affordable to lower -
income households. Additional improvements onsite would include a community building, an
office for property managers and social service providers, laundry room, computer lab, tot lot,
and 74 onsite parking for residents. New driveways, curbs, gutters, sidewalks, street trees, and
street lights and associated landscaping would also be provided. The project would be gated.
The project design utilizes a traditional housing form with pitched roofs, stone veneer, and
stucco. The buildings would be combined into small groups to fit into the adjacent residential
neighborhood (in the City of Maywood). A paseo would connect the individual units and
buildings with parking areas and common areas. The buildings are proposed to be arranged
around a central courtyard common open space. Buildings would be two stories in height.
Parking would be located along the east and west property lines. The parking areas would
provide buffers from the adjacent industrial uses. Exhibits 2, 3, 4, and 5 provide graphic
representations of site plans, floor plans for units, and example architectural features.
The .project is expected to obtain LEED (Leadership in Energy and Environmental Design)
certification, at least at the Silver level. Upon project construction completion, onsite services to
residents are planned 'with the intention of helping tenants maintain stability and prevent
eviction, build life skills, increase income and assets, increase health and well-being, and
improve the educational success of their children. The proposed project includes up to 4,500
square feet of physical space for service amenities. All services would be provided on site.
All previous building on the site have been demolished and removed; the site is currently vacant.
The grounds are predominantly paved with a crushed rock base. The northeasterly 17 feet of the
property are subject to an easement for a rail spur track and utility purposes. In the past, the
property has been used for a number of industrial uses, with the most recent being an appliance
manufacturing facility.
Project construction is anticipated to begin in December 2013, with completion in May of 2015.
Construction will require the import of new clean fill dirt to replace contaminated soils that have
been removed. Additional construction activities include installation of a vapor barrier below
each structure, installation of a venting system, building construction, landscaping, paving, and
infrastructure improvements in the form of curb and gutter, sidewalks, and street trees.
Development Agreement
The City of Vernon and Meta Housing Corporation intend to enter into a Development
Agreement for the construction of a 45 unit housing development in the City of Vernon in
accordance with the proposed zoning ordinance requirements. The Development Agreement sets
forth the permitted uses of the Site, the density and intensity of use thereon, the maximum height
and size of proposed buildings on the Site, and provisions for reservation and dedication of land
for public purposes. The Agreement will commence upon the Effective Date and shall continue
4
in force for a period of five (5) years unless extended or terminated as provided herein. This
Agreement terminates upon the expiration of the term or when the Site has been fully developed
and all of Developer's obligations in connection therewith are satisfied as determined by the
City, whichever occurs fast. During the term of this Agreement, Developer shall have a vested
right to develop the Housing Development in accordance with all ordinances, resolutions, rules,
minute orders, regulations, and official policies of the City applicable to development and
occupancy of the Site in effect on the Effective Date. The Agreement will be annually reviewed
to determine if Meta Housing Corporation has demonstrated good faith compliance with the
terms and conditions of this Agreement. If the City Council finds and determines that the
Developer has complied in good faith with the terms and conditions of this Agreement during the
period under review, the review for that period shall be concluded. If the City Council finds and
determines, on the basis of substantial evidence, that the Developer has not complied in good
faith with the terms and conditions of this Agreement during the period under review, and
Developer has been notified and given an opportunity to cure in accordance with the provisions
of Section 6 below,.the City Council may modify or terminate this Agreement in accordance
with State law.
Disposition and Development Agreement
To facilitate the cooperation between the City and the developer of the proposed 45-unit
affordable housing project, a Disposition and Development Agreement (DDA) has been
proposed by and between the City of Vernon and the developer. The DDA will be presented to
the City Council at the next regularly scheduled meeting on February 19, 2013. This DDA is
currently being negotiated but, will incorporate the following or similar provisions:
1. Conveyance of Land. City will agree to ground lease the Site, for an annual rent equal to
the residual rental value of the Site, to a development entity formed by Meta for the
development and operation of an affordable housing project on the Site (the "Project").
The City has retained the services of Keyser Marston to review the proforma study
prepared by Meta Housing Corporation and perform its own independent economic
analysis to determine the rental value of the property. Through their analysis it has been
determined that the residual rental value would be one dollar ($1.00) per year. The term
of the ground lease would be 65 years. The City will retain the non-commercial naming
rights of the development.
a. The Ground Lease, among other things, includes each of the following terms:
(i) The Ground Lease provides that City will not obtain any loans secured by the Site
unless such loans have been previously approved, in writing, by the Project
Developer.
(ii).The Ground Lease provides that City will own fee title to the land comprising the
Site, and the Project Developer will own fee title to all improvements constructed or
otherwise located on the Site.
(iii)The Ground Lease includes reasonable mortgagee protection provisions as
required by the Project Developer's lenders.
(iv)Pursuant to the terms of the Ground Lease, City, as landlord, will agree to provide
notice of any defaults by the Project Developer under the Ground Lease to the Project
Developer's limited partners and lenders (if required), and allow any such parties the
right to cure a default by the Project Developer under the Ground Lease.
(v) The Ground Lease permits the Project Developer to encumber its leasehold
interest in the Site to secure loans deemed necessary or desirable by the Project
Developer which are reasonably acceptable to City. The City will not be required to
subordinate its fee title in the Site to any construction or permanent loans obtained by
Project Developer.
(vi)The Ground Lease is in accordance with the requirements of Government Code
Section 37380(b)(1), which provides that "a city may lease property owned or held or
controlled by it, or any of its departments or boards for a period exceeding 55 years
but not exceeding 99 years, if all of the following conditions are met: (1) The lease
shall be subject to periodic review by the city and shall take into consideration the
then current market conditions. The local legislative body may, prior to final
execution of the lease, establish the lease provisions which will periodically be
reviewed, and determine when those provisions are to be reviewed."
b. Meta or its affiliate will form a limited partnership or other entity for the Project (the
"Project Developer"). The Project Developer entity will include, as the managing
general partner, Western Community Housing, Inc. (or a limited liability company
wholly owned by Western Community Housing, Inc. or another nonprofit corporation
highly experienced in the development and operation of affordable housing which is
acceptable to the City) ("Development Partner").
c. City will be responsible for creation of a legal parcel for the Site.
d. City will provide Meta with copies of all environmental reports and other information
regarding the physical condition of the Site which is in City's possession. Meta will
have access to the Site prior to closing to conduct environmental inspections and
other due diligence. Upon commencement of the ground lease of the Site to the
Project Developer, the Project Developer will be responsible for all environmental
remediation of the Site at its expense.
e. Closing for the commencement of the ground lease of the Site will occur when the
following conditions have been satisfied: Meta approval of Site condition, closing of
construction financing, receipt of commitments for required permanent financing,
receipt of all required land use entitlements, approval of construction plans by the
City, building and grading permits for the Project are ready for issuance, execution
and deposit of all closing documents, required insurance policies have been obtained,
title insurance has been obtained, required bonds have been secured, and other
reasonable and customary conditions of closing have been satisfied.
2. Project Schedule. The Agreement contains a detailed schedule of milestones for due
diligence activities and approvals; application for and obtaining entitlements; preparation,
submission and City approval of plans; application for and obtaining financing;
satisfaction of conditions to closing; closing; commencement of construction; and
completion of construction.
3. Construction. The Agreement will require that the Project be constructed in accordance
with the development standards set forth in a Development Agreement between the City
and Meta or the Project Developer adopted pursuant to Government Code Section 65864.
The Project will include approximately 9 one bedroom apartment units, 22 two bedroom
apartment units, and 14 three bedroom apartment units, a community building, an office
for Site managers and social service providers, laundry room, computer lab, tot lot, not
less than 74 onsite parking spaces, driveways, curbs, gutters, sidewalks, street trees, street
lights and associated landscaping. The Project will be gated. Three of the apartment
units (one one -bedroom unit, one two -bedroom unit and one three -bedroom unit) will be
accessible in accordance with ADA standards, and all of the ground floor level apartment
units will be adaptable to ADA accessibility standards. The Project will obtain LEED
Silver certification. Developer will be responsible for importing new clean fill dirt,
installation of a vapor barrier below each structure, and installation of a venting system.
The Project Developer will comply with state prevailing wage and apprenticeship
requirements in the construction of the Project.
4. Financing. The parties acknowledge that Low Income Housing Tax Credits and other
sources of financial assistance will be necessary to make the Project economically
feasible. The Project Developer will be required to seek reasonably available funding
sources for the construction of the Project.
a. The Agreement will include a financing plan for the Project. The Project Developer
will apply for and seek to obtain the financing sources contained in the financing
plan.
b. 9% Low Income Housing Tax Credits are contemplated for the Project. Meta will
apply for an allocation of 9% tax credits in the first California Tax Credit Allocation
Committee ("CTCAC") allocation round of 2013. If unsuccessful, Meta will apply
for an allocation of 9% tax credits in the second allocation round of 2013. If
unsuccessful in the first and second allocation rounds of 2013, City will have the right
to terminate the Agreement in its sole discretion; provided that the City may elect in
its sole discretion to authorize Developer to make one or two applications for 9% tax
credits in 2014.
c. As appropriate, the financing plan may provide for the Project Developer to seek and
apply for conventional construction and permanent loans, AHP loans, loans or other
financial assistance from the County of Los Angeles Community Development
Commission, and/or other state and federal sources of affordable housing assistance.
d. The parties do not contemplate that City will make any loans or grants to the Project.
e. Meta will retain any developer fee payable in accordance with the terms of the tax
credit financing. To the extent necessary to make the Project financially feasible,
Meta may be required to defer a portion of the developer fee for the Project.
5. Income and Affordability Requirements. The Project will be subject to affordability
requirements restricting apartment units to income limits and affordable rents.
a. 2 apartment units will be restricted to extremely low income households, 14
apartment units will be restricted to very low income households; and 6 apartment
units will be restricted to lower income households, for a total of 22 "Affordable
Units." Rents for the Affordable Units will be restricted to the maximum rents
permitted by Low Income Housing Tax Credit requirements and/or applicable
funding sources.
b. The Project will be subject to other regulatory requirements related to financing
which is actually obtained for the Project, which may include a CTCAC regulatory
agreement and regulatory agreements related to other public financing obtained for
the Project.
c. Affordability and other ongoing requirements will be set forth in a Regulatory
Agreement to be recorded as an encumbrance to the Site. The City will reasonably
consider subordination of the Regulatory Agreement to the liens recorded for the
benefit of Project Developer's conventional lenders.
6. Site Management. The Project Developer will be required to retain a Site management
firm to manage the Project.
a. City will have approval rights over the identity of the Site manager, and any changes
to the identity of the Site manager. The Site manager and Project manager will be
required to refrain from engaging in any political activity among tenants and tenant
groups.
b. The Agreement will contain a detailed Site management plan which will set forth
procedures for operation of the Project, including procedures for tenant selection, an
eviction policy, staffing schedules, house rules, security plan, and a social service
plan. The Site management plan will include a tenant selection process, which will
provide a method of soliciting tenant applications, initial screening of tenant
applicants, and random selection of pre-screened applicants for initial tenant selection
and ongoing vacancies. The tenant selection shall be through a lottery system which
will be open to the public. The applicants and City will be notified in advance of the
time and location of the lottery.
c. If the Site manager is not properly managing the Project in accordance with the Site
management plan, City will have the right to require the Project Developer to replace
the Site management company or to require the Site management company to change
the employees managing the Project.
7. Maintenance Requirements. The Project will be subject to maintenance requirements for
exterior improvements and landscaping. The Project will maintain a capital replacement
reserve account in a monthly amount to be determined [plus CPI or other inflationary
index] which may be satisfied by capital reserve requirements of financing which has
been obtained for the Project.
S. Remedies.
a. City will have the right to terminate the Agreement prior to completion of the Project
in the event Meta and/or Project Developer fails to perform any obligation of the
Agreement, subject to notice and cure rights, including the failure to meet certain
milestones in the schedule, or Meta and/or Project Developer becomes insolvent or
bankrupt, makes an assignment for the benefit of creditors, is subject to receivership,
or similar circumstances.
b. City, subject to a reasonable notice and cure period, will have the right to terminate
the ground lease and reacquire possession of the Site for reconveyance to another
developer if construction of the Project has not commenced in accordance with the
Agreement schedule, or if construction is suspended after commencement.
c. City will require Project Developer to obtain payment and performance bonds,
provide a letter of credit, or other security for the construction of the Project
reasonably acceptable to the City.
Findings
The City of Vernon Police, Fire and Community Services and Water Departments have
reviewed the proposed residential site development plans for the project and determined that the
project conform with the City adopted codes and polices. In accordance with section 26.4-5 of
the City's new zoning provisions for residential developments certain finding must be made prior
to the approval of a development agreement. It is therefore recommended that the City Council
make the following findings regarding for the proposed 45 unit housing development located at
4675 52nd Drive in the City of Vernon:
a) The design, location, size, and operating characteristics of the 45 unit housing
development is compatible with the existing land uses in the vicinity;
b) The proposed density is consistent with density standards and all applicable policies
contained in the General Plan;
c) The site and site plan are physically suitable in terms of design, location, shape, size, and
the provision of public and emergency vehicle access, and public services and utilities,
including but not limited to fire protection, police protection, potable water, schools,
sewerage, solid waste collection and disposal, storm drainage, and wastewater collection,
treatment, and disposal;
d) On -site traffic circulation for pedestrians and vehicles is designed into the development to
allow residents to move easily through the development and to avoid pedestrian/vehicular
conflicts and further and provides appropriate access for fire and police response and
surveillance.
e) The proposed project provides suitable, usable common and/or private open space that
will meet the passive and/or active recreation needs of the resident. Common open space
areas and setbacks are provided with landscaping and other improvements suitable for the
development proposed;
f) The proposed project provides adequate parking to meet the residents' needs, to avoid
parking impacts on surrounding properties, and to comply with state and federal law;
g) Refuse/recycling collection areas are located to provide easy access to for all residents
and collection vehicles, and to minimize noise impacts on residents;
CEOA
An initial study for the project was performed in compliance with the California
Environmental Quality Act (CEQA) as established in Section 21000 et. seq. of the California
Public Resources Code. The Project collectively includes the proposed 45 Unit Affordable
Housing Development at 4675 52nd Drive, the associated Development Agreement and
Disposition And Development Agreement, Proposed General Plan Amendments and Zoning
Ordinance and Map Amendments. It was determined that all potential environmental
impacts would be less than significant if appropriately mitigated.
Subsequent to publication of the initial study and proposed mitigated negative declaration,
the City met with the applicant for the housing development at 4675 52"d Drive to review the
mitigation measures, as they would be included as conditions of development. Specific
revisions to mitigation measures 4.3-1 and 4.11-2 were made to reflect to practical
construction measures and filtration system maintenance requirements that could still achieve
the desired mitigation regarding air filtration and outdoor noise. The mitigation measures
contained in the Mitigation Monitoring Reporting Program hereby revise the measures
contained in the initial study and proposed mitigated negative declaration. It is
recommended that the City Council find that the revised mitigation measures contained in the
Mitigation Monitoring Reporting Program will achieve the mitigation objectives set forth in
the initial study and proposed mitigated negative declaration, and will reduce impacts to less
than significant levels. Therefore, it is recommended that a mitigated negative declaration be
adopted for the project subject to the mitigation measures set forth in the Mitigation
Monitoring Reporting Program. It is further recommended that the City Council adopt the
Mitigation Monitoring Reporting Program.
Fiscal Impact
The City of Vernon currently owns the property located at 4675 52nd Drive in the City of
Vernon that the proposed housing development will be constructed upon. This 2.06 acre
property has a current market value of approximately $2.25 million. The City of Vernon
retained the services of Keyser Marston to perform an independent market analysis to determine
the residual rental value if the property were to be utilized for a 45 unit low income housing
development. After reviewing the pro forma prepared by Meta Housing Corporation and
performing its analysis it was determined that the housing project would only be viable if there
was financial participation from the City in the form of reduced rental rate. Keyser Marston
determination is that the residual rental rate of the property would have to be at $1.00 per year in
order to make the project feasible. The rental rate will be reviewed from time to time during the
term of the lease to confirm that the City's rental rate is appropriate.
10
Exhibit 2:
Site Plan - Proposed Affordable Housing Project at 4675 52nd Drive
1,9,
IPA
Exhibit 3:
Floor Plans - Proposed Affordable Housing Project at 4675 52nd Drive
r
f
J
13
Exhibit 4:
Rendering - Proposed Affordable Housing Project at 4675 52"a Drive
14
R � £2\� \� (§
90
RECEIVED
FEB 14 2013
CITY ADMINISTRATION
COMMUNITY SERVICES & WATER DEPARTMENT
OFFICE MEMORANDUM
TO: Mark Whitworth, City Administrator
FROM: Samuel Kevin Wilson, Director of Community Services & Water
DATE: February 14, 2013
SUBJECT: Response to comments from South Coast Air Quality Management District
(AQMD) and the City of Maywood regarding the proposed 45-Unit Affordable
Housing Development Project
We have received a letter from South Coast Air Quality Management District ("AQMD")
dated January 25, 2013 and a letter from the City of Maywood dated January 24,2013 regarding the
above -mentioned project. AQMD has submitted written comments (copy of letter attached) regarding
the proposed project site being exposed to significant levels of air pollution from nearby industrial
sources. In response to AQMD's letter the staff has prepared written responses (see attachment). It is
staff's opinion that the concerns that AQMD has raised have been adequately addressed in the
proposed mitigation measures. Therefore, the staff believes we have satisfied any issues or concerns
pertaining to this project.
The letter received from the City of Maywood is regarding the potential impacts from
construction and operations from the proposed project site. In response to their letter the staff has
prepared written responses. It is staff s opinion that the concerns that the City of Maywood has raised
have been adequately addressed in the response letter (see attachment). Therefore, the staff believes
we have satisfied any issues or concerns pertaining to this project.
SKW/sc
Auach=nts
r
lit
,f
4,305 Santa Fe Avenue, Vernon, California 90058
Telephone (323) 583-8811
February 14,2013
G-4
Ian MacMillan
South Coast Air Quality Management District
21865 Copley Drive
Diamond Bar, CA 91765-4182
Dear Mr. MacMillan:
The City thanks the SCAQMD for the continents regarding the air quality impact
assessment performed in support of the proposed low income housing development. The City
feels, as the Lead Agency, that the appropriate significance criteria have been used to assess
potential health impacts to the future residents, and that the development of the proposed site for
residential uses results in less than significant impacts. The City also notes that it has been
conservative in conducting the health risk assessment (HRA) for CEQA purposes, as the CEQA
statute and case law indicate that the focus of the analysis is project impacts on the environment,
"hot the impact of the environment on the project.
The City concurs with the SCAQMD that HRAs for the siting of sensitive land uses
within an existing built environment typically include sources of toxics air contaminants (TACs)
located within one -quarter mile of the project site. It should be noted, the health risk analyses
were originally prepared to aid the City in assessing the suitability of multiple non-specific
potential housing locations within the City of Vernon. To ensure flexibility and maximum
applicability, the health risk analyses included TAC sources within a larger radius of the
candidate sites. Based on the maximum individual cancer risks, the City concluded a number of
health protective design features should be integrated into future development plans, as
appropriate. In addition, the burden threshold was used to assess the relative risks by accounting
for the different future populations each potential housing site could accommodate.
For the reasons stated in the HRA, the City does not believe the incremental cancer risk is
an appropriate threshold for this project. Nonetheless, in response to the SCAQMD's letter, the
City has reviewed the HRA and verified that the individual cancer risks reported in the MND are
highly conservative for the specific project site currently under consideration, as it includes
sources farther than one -quarter mile of the proposed project site. Applying the control
efficiency of an air intake filtration system rated at MERV 8 to the unmitigated screening HRA
risks results in a maximum predicted cancer risk of approximately 12 in one million in the
vicinity of the proposed project site. (This value also accounts for the corrected breathing rate, as
notedbelow.) This cancer risk value included approximately 3,500 feet distance from the 1-710
EE.,chusive y Industriaf
February 14, 2013 Page 2
freeway and the Atlantic Boulevard off -ramp, which is outside of the quarter -mile radius of the
identified project boundaries. Per SCAQMD's suggestion, the City has refined the HRA
modeling to more specifically only include sources within one -quarter mile of the site. Based on
review of site plans and aerial photo measurements; the City notes that a segment of the 1-710
freeway lies within one -quarter mile of the nearest (northeastern) boundary of the proposed
residential development. The majority of the dwelling units will be built more than one -quarter
mile from the freeway. The site -specific dispersion modeling and risk calculations show that
future residents will be exposed to a cancer risk of 6 in one million, which is less than the
threshold of 10 in one million recommended by the SCAQMD. The cancer risk value of one in
six million also takes into account MERV 8 filtration systems which will be installed in the units
as required by mitigation measure 4.3-1, as outlined in the mitigation monitoring reporting
.program for the project.
Detailed dispersion modeling and health risk calculation files were sent to the SCAQMD
for review on or around February 4, 2013.
AQMD RECOMMENDED MITIGATION MEASURES
Review of the HRA has not revealed any significant air quality impacts. The proposed
mitigation continues to be adequate. Mitigation measure 4.3-1 requires installation of MERV 8
filtration systems in each unit and further, that the project manager provide long-term
maintenance of the filters. The mitigation measure does not require positive pressure with the
building's filtered ventilation system in living spaces since provision of the MERV 8 filtration
systems alone is deemed adequate. .
MODELING FILE AVAILABILITY
Comment noted. Detailed dispersion modeling and health risk calculation files were sent
to the SCAQMD for review on or around February 4, 2013.
Health Risk Modeling Parameters
Comment noted. The breathing rate used for future residents should be 21.1 m3/day. The
City notes that the correct breathing rate was used in the HRA to calculate impacts from
stationary sources. The breathing rate was corrected and applied to the refined mobile source
analysis discussed above. Results of the analysis indicated that cancer risk would be below the
10 in one million. threshold recommended by the SCAQMD. Therefore the results discussed
above for the proposed site are consistent with the analysis contained in the MND. Health risk
impacts will remain less than significant, and no mitigation measures are required.
The diesel particulate matter emission rate used in the HRA was based on the current
fleet mix.1 Although future fleet mix will result in reduced DPM emissions, the analysis takes a
conservative approach. Therefore, the City feels that no corrections are necessary.
California Air Resources Board EMFAC 2011 database. httg:JZwww.arb.ca.gov/emfac (Accessed October 2012)
City of Vernon, 4305 Santa Fe Avenue, Vernon, California 90058 — Telephone (323) 583-8811
February 14,2013 Page 3
Sincerel
am el Kevin Wilson, P.E.
Director of Community Services & Water
SKW
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South Coast
Air Quality Management District
21865 Copley Drive, Diamond Bar, CA 91765-4182
(909) 396-2000 • www.aamd.gov
E-Mailed: January 25, 2013 January 25, 2013
KWilson@ci.vemon.ca.us
Mr. Kevin Wilson
City of Vernon
4305 Santa Fe Avenue
Vernon, CA 90058
The South Coast Air Quality Management District (AQMD) staff appreciates the
opportunity to comment on the above -mentioned document. The following comments
are intended to provide guidance to the lead agency and should be incorporated into the
final environmental document as appropriate.
The MND demonstrates that the residents living on the project site will be exposed to
significant levels of air pollution from nearby industrial sources. Specifically, the MND
states that residents at the preferred project site will be exposed to an incremental cancer
risk of 26 in one million, however, the lead agency concludes that the project will result
in less than significant air quality impacts. Further, the Health Risk Assessment (HRA)
contained in the MND appropriately compares the project's cancer risk levels to
AQMD's cancer burden threshold of 0.5 and the AQMD's Maximum Incremental Cancer
Risk (MICR) threshold of 10 in one million. However, it appears that the lead agency
based its significance determination solely on the cancer burden threshold. The AQMD
CEQA significance thresholds are not intended to be individually selected and applied to
projects; therefore, the AQMD staff recommends that the lead agency revise the MND to
ensure that the air quality significance determination is based on all AQMD CEQA
significance thresholds including the MICR value of 10 in one million.
If upon revision of the MND the lead agency determines that the project will have
significant air quality impacts based on the HRA the AQMD staff recommends that the
lead agency include the following mitigation measures in the final CEQA document.
a. Specify conditions to ensure that high efficiency filters will continue to be
maintained and replaced for the life of the project (e.g., through a provision in the
covenants, conditions and restrictions, CC&Rs), and
b. Consider maintaining positive pressure with the building's filtered ventilation
-- - - system in living spaces to reduce infiltration of unfiltered outdoor air.
Mr, Kevin Wilson
January 25, 2013
AQMD staff requests that the lead agency provide the electronic modeling files so that
we can review them more thoroughly. Without these files, we can only offer partial
comments as many details are not available to us. The lead agency may want to revise
the HRA prior to finalizing the CEQA process for this project as there are several
calculation procedures that may have led to spurious results in the HRA. These include
the items identified below.
The breathing rate of 16.2 m3/day in the HRA is lower than the District
recommended rate of 21.14 m3/day (302 L/kg-day). This error results in reported
risks that are too low.
The HRA did not take into account the expected lower Diesel Particulate Matter
(DPM) emissions in future vehicle fleets. This discrepancy results in reported
risks that are too high.
The results from modeling the I-710 freeway are unexpected as DPM accounts for
only —40% of the freeway risk. Typically DPM account for —90% of the risk.
Without access to the modeling files, AQMD staff is not able to verify the validity
of the reported result.
Pursuant to Public Resources Code Section 21092.5, please provide the SCAQMD with
written responses to all comments contained herein prior to the adoption of the final
CEQA document. Further, staff is available to work with the lead agency to address
these issues and any other questions that may arise. Please contact Dan Garcia, Air
Quality Specialist CEQA Section, at (909) 396-3304, if you have any questions regarding
the enclosed comments.
Sincerely,
'W v. 11A44
Ian MacMillan
Program Supervisor, CEQA Inter -Governmental Review
Planning, Rule Development & Area Sources
IM:DG
LAC 130109-04
Control Number
4305 Santa Fe A
Telephone' (323) 583-8811
February 11, 2013
Rocio Lopez
City of Maywood
4319 East Slauson Avenue
Maywood, CA 90270
Dear Mr. Lopez:
G-4
Thank you for providing your comments to the proposed 45 unit affordable housing
development project to be located at 4675 52"d Drive in the City of Vernon. The City of Vernon
hereby responds to the comments and questions you have raised.
C-1: The Site plan does not show the depth of the property,
A: The depth of the property that will be developed is 199.4 feet; please see the attached
site plan.
C-2: The site plan shows a fence located right along the front property line. As the City
of Maywood has residential units immediately to the south of this property; we are
_recommending that any fencing be located behind a front landscaped setback area. Fencing
material and.height should also be called out in the site plan.
A: The City of Vernon has no setback requirements on fencing. However, the City will
work with the developer to see if the fence, can be slightly set back from the street right-of=way.
The attached site plan currently shows the fence will beset back two feet from the back of
sidewalk. Additionally, the Developer will be landscaping the parkway strip in the sidewalk area
while maintaining a pedestrian walkway in compliance with ADA. This will also aid in
softening the look of the fence. The fence and gate material along the street riht o
`-six foot in height and be of wrought iron materials. gf way will be
C-3: The assessor parcel map shows 52"d Drive as a 50 foot wide street. The site plan
indicates that the property line starts 25 feet from the centerline to the subject site property line.
If landscaping is proposed in front of the proposed fence, that would be within the City right of
way. Who will maintain this landscaped setback area?
A: The landscape area in the parkway strip is required to be maintained by the adjoining
property owner in accordance with Sections 22.62 and 22.63 of the City Code.
rE,Xcfusivefy Industrial
February 13, 2013 Page 2
C-4: Please provide us with an actual full scale site planwhich shows fencing materials,
including driveway gates, location of King Avenue'(will the proposed driveway line up with this
street?), proposed front i 4ttdscape setback. (front landscape plan) and public improvements i.e.
existing telephone poles, along 52A Drive.
A: Attached herewith you find a copy of tle plan you have requested. It should be noted
that the City is not requiring the developer to underground the aboveground utilities. Two
additional fire hydrants will be added in and around the frontage of the property. The exact
location of the fire hydrants will be determined by the Vernon Fire Department. The site plan
attached shows the relationship of the site with King and Mayflower Street and the existing
improvements in the sidewalk area.
C-5: Please provide us with a southern elevation of the. proposed project (street view from
52"d Drive).
A: Attached herewith you will find a plan reflecting the southern elevation of the
proposed project. Also attached is a rendering from the 52"d Drive perspective.
C-6: Under Section 4.15 Transportation and Traffic, the Mitigated Negative Declaration
states, under sections a-d that there are No Impacts. The City of Vernon's acceptable level of
service is D, while the City of Maywood's acceptable level of service for local streets is. C. 52"a
Drive in Maywood is a local street. According to the City of Maywood's'Final EIR Land Use
Element, in accordance with the City's LOS standard, which is LOS D for arterial and collector
streets, study intersections that deteriorate to LOS E. or worse are significantly impacted and
mitigation is required.
A: Please note that the analysis in the traffic study was prepared to address several
General Plan and Zoning Ordinance amendments being contemplated by the. City, including
establishment of a Housing Overlay District/Zone that would facilitate development of the
proposed housing project analyzed in the Initial Study. At this time, only proposed amendments
relating to housing are moving forward.
Regarding the acceptable level of services (LOS) used in the analysis, for those streets
located in the City of Vernon the City has used its adopted standard of LOS D. In recent .
discussions with the City of Maywood contract traffic engineer, we learned that the Maywood
also uses the LOS D standard.
The analysis focused on major and collector streets and not local streets such as E. 52"d
Drive. Also, the intersection of Atlantic Boulevard/E. 52"d Drive was not analyzed specifically
for the housing development because in Los Angeles County, the minimum project -added traffic
that is needed before an intersection has to be studied is 50 two-way trips in either the morning
or evening weekday peak hour. As the attached supplementary material (Kunzman Associates,
Inc. letter dated February 4, 2013) indicates, the proposed housing developmentis estimated to
generate 23 morning and 28 evening peak hour trips, below the threshold. Thus, no analysis of
this intersection was warranted.
The projected future conditions of LOS E and F are associated with regional growth and
build -out in Vernon consistent with land use policy. The theoretical intersection impacts are
based on the intersection capacity compared to the number of project trips that are projected at
each intersection. Based on the Los Angeles Department of Transportation Policies and
Procedures, an impact.is considered significant if the project -related increase in the volume -to -
capacity ratio equals or exceeds the thresholds shown below:
City of Vernon, 4305 Santa Fe Avenue, Vernon, California 90058.- Telephone (323) 583-8811
February 13, 2013
Page 3
Level of Service Volume/Ca' aci Incremental Inci
C 0.70-0.79 0.04 or more
D 0.90-0.89 0.02 or more
E/F 0.90 - more . 0.01 or more
In order for the housing development to impact an intersection by one percent, the
intersection of Atlantic Boulevard at District Boulevard would have.to receive 48 project vehicle
trips during the morning or evening peak hour (4,828 X 0.1 = 48.28), and.the intersection of
Atlantic Boulevard at E. 52nd Drive would have to receive 80 project vehicle trips during the
morning or evening peak hour (8,063 X 0.1 = 80.63). Table 3 in the attached Kurtzman
Associates, Inc. letter shows that that the trips associated with the housing development fall well
below the one percent threshold for LOS F. The study area intersections are not projected to be
impacted. The housing development itself will not create significant traffic impacts, nor will it
contribute cumulatively significant impacts.
The comment letter, states that anything over an unacceptable level of service needs to be
mitigated. However, the criteria used are twofold: over an acceptable LOS :and over the
significance threshold. This project does not meet or exceed the significance threshold.
C-7: The Traffic Study does not clearly address the future level of service at the
intersection of 52nd Drive and Atlantic Blvd. It does, however, address the intersection of
District Blvd, and Atlantic Blvd. with a projected level of service between E and F.
A: See response to C-6.
C-8: The MND should therefore address mitigation measures for the proposed
intersection of 52 nd Drive and Atlantic Blvd., particularly for those vehicles turning southbound
and north bound from 52 nd Drive onto Atlantic Blvd.
A: The criteria used are twofold to determine if an intersection is significantly impacted:
over an acceptable LOS and over the significance threshold. This project does not meet or
exceed the significance threshold, therefore no mitigation is required.
C-9: Under section e. Inadequate Emergency Access, it does not address the fact that
there is no emergency access circulation to the rear of the property as parking spaces are
blocking the access. Site pan should show adequate on site emergency access.
A: The Vernon fire Department has reviewed and approved the site plan for the project.
It is their opinion that sufficient emergency access is being provided to the site. In accordance
with section 503.1 of the California Fire Code a fire access road shall extend to within 150 feet
of all portions of the exterior wall of the first story of the building as measured along an approve
route. The fire code permits this distance to be increased if the building is equipped with an
approved automatic sprinkler system. The apartments will.be served with an automatic fire
sprinkler system and therefore the fire department has approved the 150 foot distance to be
increased. Dead end fire roads will lead into each side of the apartment complex within the
parking lots and in compliance with the fire code. The fire department will either be provided
with the keys to access the gates or Knox boxes will be provided to permit access to the parking
City of Vernon, 4305 Santa Fe Avenue, Vernon, California 90058 — Telephone (323) 583-8811
February 13, 2013 Page 4
areas. The maximum distance from the fire road or to; the street right of way to the exterior
portion of any of the buildings is proposed to be 160 feet.
C-10: According to the most updated Assessor Parcel Map, 52nd Drive is 50 feet in width.
The street however appears to be very narrow and there are signs stating "No Parking At Any
Time" along the north side of 52"d Drive in the City of Vernon public right-of-way. We are
concerned that residents and visitors associated with this project may park along the south side
within the City of Maywood, creating a burden to this already narrow street.
A: The site is proposed to have 76 parking stalls. This apartment complex will be for low
and moderate income families. Therefore, it is assumed based on historical data that many of the
residents will be one car families. As such the City is of the opinion that sufficient parking is
being provided onsite for the residents and their visitors and no offsite parking will be required
for the housing development. Attached herewith please find a white paper prepared by the.
Southern California Association of Non -Profit Housing which concludes that it is not necessary
to provide the same parking ratios for market rate apartments compared to. affordable housing
units and concludes, that 1 stall per unit is sufficient. The City of Los Angles only requires 1
parking stall for units containing 2 or less habitable rooms and 1.5.parking stall per unit
containing 3 or more habitable rooms for restricted affordable housing units. The Vernon project
will provide 1.69 stalls per unit. In addition, Applied Planning, Inc. recently prepared a study for
the Salem Apartments in Glendale. There study concluded that if the proposed low income
housing project was outside of the central business district the following parking ratios were
appropriate:
• One -bedroom 1.25 resident spaces plus 0.17 guest space
• One -bedroom 1.50 resident spaces plus 0.17 guest space
• One -bedroom 1.75 resident spaces plus 0.17 guest space
Based on these ratios and given the mix of Vernon's housing units, the Vernon project would
require 76 parking stalls, exactly what is being provided.
Lastly, the City discussed the proposed parking ratios with Solari Enterprises Inc., who
manages over 75 low and moderate income family housing projects in the Southern California
area. This firm routinely performs parking surveys of th€units they manage. They have found
all of the developments that they manage have excess parking spaces during all periods of the
day, with the exception of one development in San Diego, which is parked at 0.5 spaces per unit.
This includes an 80 unit complex with 83 parking stalls, a 78 unit complex with 84 parking stalls
and an 85 unit complex with 134 parking stalls all located in the City of Los Angeles.
The City of Vernon appreciates your concerns and believes that all of the issues that you
have raised have been adequately addressed. If you have any questions please do not hesitate to
contact me.
SKW
Sincerely
vin Wilson, P.E.
irector of Community Services & Water
City of Vernon, 4305 Santa Fe Avenue, Vernon, California 90058 —Telephone (323) 583-8811
KIINZMAN ASSOCIATES, INC.
Q OVER 35 YEARS OF EXCELLENT SERVICE
February 4, 2013
Ms. Laura Stetson
MIG I HOGLE-IRELAND
630 North Rosemead Boulevard, Suite 150
Pasadena, CA 91107
Dear Ms. Stetson:
INTRODUCTION
The firm of Kunzman Associates, Inc. is pleased to provide this project analysis for the 52nd Drive
Apartments project. The proposed project site is located on the north side.of East 52nd Drive and east
of Atlantic Boulevard in the City of Vernon (see Figure 1).
Although this is a technical report, every effort has been made to write the report clearly and concisely.
To assist the reader with those terms unique to transportation engineering, .a glossary of terms is
provided in Appendix A.
PROJECT DESCRIPTION
The project site is proposed to be developed with 45 apartments. Figure 2 depicts the proposed project
site plan. The site is currently vacant and not generating any vehicular trips.
Apartment land use peak traffic volumes occur in the morning and evening when inhabitants are going
to and from work. Mid -day volumes are often shopping oriented or child related, such as home -to -
school and home -to -Little League. The vehicle mix is virtually all passenger vehicles.
GENERAL PLAN LAND USE
The project site is currently projected to be developed with manufacturing land use.
Manufacturing land use will characteristically have fewer employees per acre than most other business
or commercial uses, and fewer non -employee visits. There are pronounced traffic peaks as employees
arrive in the morning and depart in the evening. The vehicle mix is split between passenger vehicles and
heavy trucks.
1111 TOWN & COUNTRY ROAD, SUITE 34
ORANGE CALIFORNIA 92868
. (7141973-93a3
w W W.TRAFFIC-ENGINEER.00Nt
Ms. Laura Stetson
MIG I HOGLE-IRELAND
February 4, 2013
EXISTING TRAVEL LANES AND INTERSECTION CONTROLS
Figure 3 identifies the existing roadway conditions within the study area. The existing number of
through travel lanes, intersection controls, and the intersection geometries are identified.
REQUIREMENT OF A TRAFFIC IMPACT ANALYSIS
In Los Angeles County, the minimum project added traffic that is needed before an intersection has to
be studied is So two way trips in either the morning or evening weekday peak hour.
If a project adds more traffic than the minimum threshold amount to an intersection, then that
intersection has to be analyzed for deficiencies.
DEFINITION OF DEFICIENCY AND SIGNIFICANT IMPACTS
The City of Vernon has an established acceptable Level of Service of D. Level of Service E and F are
unacceptable.
Based on the Los Angeles Department of Transportation Policies and Procedures, an impact is
considered significant if the project -related increase in the volume -to -capacity ratio equals or exceeds
the thresholds shown below:
Significant Impact Threshold for Intersections
Level of Service
Volume/Capacity
Incremental Increase
C
0.70-0.79
0.04 or more
D
0.80-0.89
0.02 or more
E/F
0.90--more
0.01ormore
DETERMINATION OF INTERSECTION CAPACITY
In Los Angeles County, the technique used to calculate Intersection Capacity Utilization is as follows.
Lane capacity is 1600 vehicles per lane per hour of green time for through and turn lanes, except that a
capacity of 2880 vehicles per lane per hour of green time is used for dual turn lanes. A total yellow
clearance time of 10 percent is added. .
To determine the potential capacity of an intersection the appropriate percentage of green time has
been allocated to each turning movement and then multiplied by the lane capacities. The theoretical
capacity of Atlantic Boulevard (NS) at District Boulevard (EW) is 4,828 vehicles per hour and the Atlantic
Boulevard (NS) at East 52nd Drive (EW) is 8,063 vehicles per hour (see Table 1).
W W W.TRAFFIC-ENGINEER.COM
2
Ms. Laura Stetson
MIG I HOGLE-IRELAND
February 4, 2013'
PROPOSED PROJECT TRIP GENERATION
The trips generated by the proposed project are determined by multiplying an appropriate trip
generation rate by the quantity of land use. Trip generation rates are predicated on the assumption that
energy costs, the availability of roadway capacity, the availability of vehicles to drive, and our life styles
remain similar to what we know today. A major change in these variables may affect trip generation
rates.
Trip generation rates were determined for daily traffic, morning peak hour inbound and outbound
traffic, and evening peak hour inbound and outbound traffic for the proposed land use. By multiplying
the trip generation rates by the land use quantity, the traffic volumes are determined. Table 2 shows
the proposed project trip generation based upon rates obtained from the Institute of Transportation
Engineers, Trio Generation 9th Edition, 2012.
The proposed project is proje fed to generate approximately 299 daily vehicle trips, 23 of which will
occur during the morning peak hour and 28 of which will occur during the evening peak hour.
PROPOSED PROJECT TRIP DISTRIBUTION
To'determine the trip distribution for the potential project, peak hour traffic counts of the existing
directional distribution of traffic for existing areas in the vicinity of the site, and other additional
.information on future development and traffic impacts in the area were reviewed. The trip distribution
for the potential project is provided on Figure 4,
THEORETICAL INTERSECTION IMPACTS The theoretical intersection impacts are based on the intersection capacity compared to the number of
project trips that are projected at each intersection.
In order for the project to impact the intersection by one (1) percent, the intersection of Atlantic
Boulevard (NS) at District Boulevard (EW) would have to receive 48 project vehicle trips during the
morning or evening peak hour (4,828 X 0.1 = 48,28), and the intersection of Atlantic Boulevard (NS) at
East 52nd Drive (EW) it would have to receive 80 project vehicle trips during the morning or evening
peak hour (8,063 X 0.1= 80.63), .
Table 3 shows that that the projects trips are well below the one (1) percent threshold for Level of
Service F. The study area intersections are not projected to be impacted.
CONCLUSION
The project does not contribute traffic to the study area greater than or equal to the fifty (50) peak hour
vehicle trip threshold during the morning or evening peak hours.
W W W.TRAFFIC-ENGINEER.COM
3
Ms. Laura Stetson
MIG I HOGLE-IRELAND
February 4, 2013
If the intersections of Atlantic Boulevard INS) at District Boulevard (EW) or Atlantic Boulevard (NS) at
East 52nd Drive (EW) were analyzed, the project does not generate enough vehicle trips to significantly
impact the intersections.
It should be noted that intersection deficiencies in shown in the City of Vernon General Plan Update
Traffic Impact Analysis, dated December 11, 2012, are from the existing land uses and areawide growth
but not the proposed project and the vacant parcels within the City.
It should be noted that the 52nd Drive Apartment project will decrease the potential for heavy truck
traffic along East 52nd Street adjacent to the existing homes of the residents to the City of Maywood.
It has been a pleasure to serve your needs on this project. Should you have any questions or if we can
be of further assistance, please do not hesitate to call at (714) 973-8383.
Sincerely,
KUNZMAN ASSOCIATES, INC.
Carl Ballard, LEED GA
Principal Associate
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KUNZMAN ASSOCIATES, INC.
William Kunzman, P.E.
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Table 2
Trip generation'
Land Use
Quantity
Unit'
Morning
Evening
Daily
Inbound
Outbound
Total
Inbound
Outbound
Total
Trio Generation Rates
DU
0.10
0.41
0.51
0.40
0.22
0.62
6.65
Apartments
Trios Generated
Apartments
45
DU
5
18
23
18
10
28
299
r5ource: Institute of Transportation Engineers, Trlo Generation. 9th Edition, 2012, Land Use Category 220.
2 DU = Dwelling Unit
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Figure 1
Project location Map
Atlantic Boulevard
East 52nd Street
District Boulevard
S2'
aol�
P
Site
King Avenue/
Mayflower Avenue
NTS 5031/1-
KUNZMAN ASSOCIATES, INC.
OVFR 35 VEnRS OF E%Ln TENT SERVICE
0
Figure 2
Site Plan
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KLINZMANAssoc[ATES, INC. 5031/2
OVER 35 YEARS OF EXCELLENT SERVICE
9
Figure 3
Existing Intersection Controls and Through Travel Lanes
East S2nd Street
w
NTS
KUNZMAN
VIdyuvwci MVZIIUc
dAbsos
ddb�os
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Legend
Q =Traffic Signal
vov = Stop Sign
4 =Through Travel Lanes
D = Divided
U = Undivided
>> = Free Right Turn
5031/3
IATES, INC. Intersection reference numbers are in upper left corner of turning movement boxes.
OVER J$ YEARS OF tACELLEKT SERVICE
10
NTS
East 52nd
t��w�MAN ASSOCIATES, I
OVER 3$VFAQS OF -, IF MT SERVICE
Figure 4
Project Trip Distribution
Legend
10%= Percent To/From Project
5031/4,
11
APPENDIX A
GLOSSARY OF TRANSPORTATION TERMS
GLOSSARY OF TRANSPORTATION TERMS
COMMON ABBREVIATIONS
AC:
Acres
ADT:
Average Daily Traffic
Caltrans:
California Department of Transportation
DU:
Dwelling Unit
ICU:
Intersection Capacity Utilization
LOS:
Level of Service
TSF:
Thousand Square Feet
V/C:
Volume/Capacity
VMT:
Vehicle Miles Traveled
TERMS
AVERAGE DAILY TRAFFIC: The total volume during a year divided by the number of
days in a year. Usually only weekdays are included.
BANDWIDTH: The number of seconds of green time available for through traffic in a
signal progression.
BOTTLENECK: A constriction along a travelway that limits the amount of traffic that
can proceed downstream from its location.
CAPACITY: The maximum number of vehicles that can be reasonably expected to pass
over a given section of a lane or a roadway in a given time period.
CHANNELIZATION: The separation or regulation of conflicting traffic movements into
definite paths of travel by the use of pavement markings, raised islands, or other
suitable means to facilitate the safe and orderly movements of both vehicles and
pedestrians.
CLEARANCE INTERVAL: Nearly same as yellow time. If there is an all red interval after
the end of a yellow, then that is also added into the clearance interval.
CORDON: An imaginary line around an area across which vehicles, persons, or other
items are counted (in and out).
CYCLE LENGTH: The time period in seconds required for one complete signal cycle.
CUL-DE-SAC STREET: A local street for turning around. open at one end only, and with special provisions
DAILY CAPACITY: The daily volume of traffic that will result in a volume during the'
peak hour equal to the capacity of the roadway.
DELAY: The time consumed while traffic is impeded in its movement by some element
over which it has no control, usually expressed in seconds per vehicle.
DEMAND RESPONSIVE SIGNAL: Same as traffic -actuated signal.
DENSITY: The number of vehicles occupying in a unit length of the through traffic
lanes of a roadway at any given instant. Usually expressed in vehicles per mile.
DETECTOR: A device that responds to a physical stimulus and transmits a resulting
impulse to the signal controller.
DESIGN SPEED: A speed selected for purposes of design. Features of a highway; such
as curvature, superelevation, and sight distance (upon which the safe operation of
vehicles is dependent) are correlated to design speed.
DIRECTIONAL SPLIT: The percent of traffic in the peak. direction at any point in time.
DIVERSION: The rerouting of peak hour traffic to avoid congestion.
FORCED FLOW: Opposite of free flow.
FREE FLOW: Volumes are well below capacity. Vehicles can maneuver freely and
travel is unimpeded by other traffic.
GAP: Time or distance between successive vehicles in a traffic stream, rear bumper to
front bumper.
HEADWAY: Time or distance spacing between successive vehicles in a traffic stream,
front bumper to front bumper.
INTERCONNECTED SIGNAL SYSTEM: A number of intersections that are connected to
achieve signal progression.
LEVEL OF SERVICE: A qualitative measure of a number of factors, which include speed
and travel time, traffic interruptions, freedom to maneuver, safety, driving comfort
and convenience, and operating costs.
LOOP DETECTOR: A vehicle detector consisting of a loop of wire embedded in the
roadway, energized by alternating current and producing an output circuit closure
when passed over by a vehicle.
MINIMUM ACCEPTABLE GAP: S allest ti a headway between successive vehicles in
a traffic strea into which another vehicle is willin and able to cross or er e.
MULTI -MODAL: More than one ode; such as auto obile, bus transit, rail rapid
transit, and bicycle transportation odes.
OFFSET: The ti a interval in seconds between the be innin of reen at one'.
intersection and the be innin of reen at an adjacent intersection.
PLATOON: A closely rouped cc ponent of traffic that is co posed of several
vehicles ovin , or standin ready to ove, with clear spaces ahead and behind.
ORIGIN -DESTINATION SURVEY: A survey to deter ine the point of on in and the
point of destination for a iven vehicle trip.
PASSENGER CAR EQUIVALENTS (PCE):- One car is one Passen er Car Equivalent. A
truck is equal to 2 or Passen er Car Equivalents in that a truck requires Ion er to
start, oes slower, and accelerates slower. Loaded trucks have a hi her Passen er Car
Equivalent than a pty trucks.
PEAK HOUR: The 60 consecutive inutes with the hi hest nu ber of vehicles.
PRETIMED SIGNAL: A type of traffic si nal that directs traffic to stop and o on a
predeter ined ti a schedule without re and to traffic conditions. Also, fixed ti e
si nal.
PROGRESSION: A ter used to describe the pro ressive ove ent of traffic throu h
several si nalized intersections.
SCREEN -LINE: An i a inary line or physical feature across which all trips are counted,
nor ally to verify the validity of athe atical traffic odels.
SIGNAL CYCLE: The ti a period in seconds required for one co plete sequence of
si nal indications.
SIGNAL PHASE: The part of the si nal cycle allocated to one or ore traffic
ove ents.
STARTING DELAY: The delay experienced in initiatin the ove ent of queued traffic
fro a stop to an avera a runnin speed throu h a si nalized intersection.
TRAFFIC -ACTUATED SIGNAL: A type of traffic si nal that directs traffic to stop and o
in accordance with the de ands of traffic, as re istered by the actuation of detectors.
e
TRIP'. The movement of a person or vehicle from one location (origin) to another
(destination). For example, from home to store to home is two trips, not one.
TRIP!END: One end of a trip at either the origin or destination; i.e. each trip has two
trip -ends. A trip -end occurs when a person, object, or message is transferred to or
from a vehicle.
TRIP GENERATION RATE: The quality of trips produced and/or attracted by a specific
land use stated in terms of units such as per dwelling, per acre, and per 1,000 square
feet of floor space.
TRUCK: A vehicle having dual tires on one or more axles, or having more than two
axles.
UNBALANCED FLOW: Heavier traffic flow in one direction than the other. On a daily
basis, most facilities have balanced flow. During the peak hours, flow is seldom
balanced in an urban area.
VEHICLE MILES OF TRAVEL: A measure of the amount of usage of a section of
highway, obtained by multiplying the average daily traffic by length of facility in miles.
i
Parking Requirements Guide
For Affordable Housing
Developers
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005
Los Angeles, CA 90010
www.scanph.org
02.17.04
Table of Contents
Parking Requirements Fact Sheet
List of Relevant Resources
Best Practices Policies
Example Best Practices Policy - Los Angeles
Sample Southern. California Minimum Parking Requirements
Related Newspaper Articles
page. 3
4
6
7
8
11
{°Rethinking Residential Parking: Myth & Facts" Appendix
A Report by the Non -Profit Housing Association of Northern California
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH:213-480-1249 www.scanoh.ora
-2-
Parking Requirements and the Cost to Affordable Housing
Fear of traffic congestion and overcrowded street parking has led many cities to
establish minimum parking requirements calling for developments to provide
often excessive amounts of off-street parking. Aside from creating excess
parking and adding to congestion by encouraging automobile usage, parking
requirements have a tremendous negative impact on development of all kinds,
especially affordable housing.
Problems for Affordable Housing Developers
Increases Development Costs - Parking requirements drive up the cost of
development, resulting in less units of housing. Needing to spend more on
parking means less funds available to provide housing. Some developments end
up having more space for cars than for people.
Reduces the Potential for Other Amenities and Uses Wastes Land - Parking
requirements also mean that less money and land is available for other purposes.
Childcare facilities, community rooms, and play areas may all be sacrificed in
order to accommodate parking. The possibility for mixed -use, such as ground -
floor retail, are also reduced, leaving other community needs unmet in the name
of parking.
• Less Attractive Desians - Meeting parking requirements becomes a focal point
in the design process and eliminates opportunities to incorporate open space.
With less parking to consider, a building can be designed that more reflects a
neighborhood's context and needs.
Is All This Parking Needed?
No. Parking requirements have largely been arbitrarily determined and do not
usually reflect the verifiable parking needs of the people who will make use of a
development.
• Parking requirements have often been set using a "one -size fits all" approach
using information gathered during peak periods at developments with ample
parking in areas with few public transit options.
The likely residents of affordable housing do not require a great deal of parking.
Studies show that the correlation between income and vehicle ownership is
strong, with the likelihood of owning more than one vehicle increasing with
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH: 213-480-1249 www sconnh ora
3-
income. Low-income families, seniors, and special needs populations are less
likely to require the useof more than one parking space, if that, at all. The need
for parking also decreases for residents in dense areas near transit.
Southern California. Association of Non•Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH: 213-480-1249 www scanah.oto
-4-
Resources
Planning for Residential Parking: A Guide for Housing Developers and Planners.
Website created by NPH to help developers be more effective in arguing for
reduced parking. Contains data, recommendations, and a model for
determining the amount of. parking needed by a specific site.
htip://dcrp ced berkelev edu/studentsZrrusso/parking/Developer%20Manual/in
dex.htm
Donald Shoup
Professor, Urban Planning. UCLA.
Has written numerous reports regarding parking requirements'. Argues for
reduced parking requirements for numerous developments, including
affordable housing.
shoup@ucla.edu
Reports
Parking Requirement Impacts on Housing Affordability
Todd Litman, Victoria Transport Policy Institute. Victoria, B.C„ Canada, 1999.
www.vfpi.org/r)ark-hou.pdf
Pavement Busters Guide: Why and How to Reduce the Amount of Land Paved for
Roads and Parking Facilities
Todd Litman, Victoria Transport Policy Institute. Victoria, B.C., Canada, 2000.
www vtpi ora/pav-bust bdf
Smart Growth Zoning Codes: A'Resource Guide
Local Government Commission. Sacramento, 2003. To order a copy, visit
www.lac.ora
Travel Characteristics of Transit -Oriented Development in California
Hollie Lund (CSU Poly, Pomona), Robert Cervero (UC Berkeley), Richard Wilson
(CSU Poly, Pomona). California, 2004. Please contact SCANPH for a copy.
Rethinking Residential Parking: Myth & Facts
Southern California Association of Non -Profit Housing -
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH: 213-480-1249 wwvv sconoh org
5-
Non -Profit Housing Association of Northern California (NPH). San Francisco, 2001.
www non prof ithousing ora/actioncenter/toolbox/parking/mythsand facts.p'df
Reducing Housing Costs by Rethinking Parking Requirements
San Francisco Planning and Urban Research Association (SPUR).
San Francisco, 1998. www.sipur.org/documents/sipurhsqr)ka.odf
Reports. cont.
Buying Time at the Curb
Donald Shoup, UCLA Department of Urban Planning. Los Angeles, 2003.
www.spipsr.ucla.edu/up/webfiles/buyinatime.ipdf
The High Cost of Free Parking
Donald Shoup, UCLA Department of Urban Planning. Los Angeles, 1997.
www sppsr ucla.edu//dup/people/faculty/Shoup%20Pub%204.pdf
In Lieu of Required Parking
Donald Shoup, UCLA Department of Urban Planning. Los Angeles, 1999.
www sppsr ucla.edu//dup/people/faculty/ShouD7.2OPub%202.pdf
The Trouble With Minimum Parking Requirements
Donald Shoup, UCLA Department of Urban Planning. Los Angeles, 1999.
Housing Shortage/Parking Surplus: Silicon Valley's Opportunity to Address
Housing Needs and Transportation Problems with Innovative Parking Policies
Transportation and Land Use Coalition. San Jose, 2002.
www.transcoolition.ora/reports/housing s/housina shortage home.html
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH:213-480-1249 www.scanoh.ora
Best Practice Policies
Here is a quick list of jurisdictions and practices that can be used as examples:
Combined Reductions in
Parking Requirements
for Affordable Housing
and Proximity to Transit
Parking •kequiremerit
Reductions for '
A ftol d iTpla; H otA,�i h g
Using Square Feet
Rather Than Bedrooms
for Parking
Requirements
City of Los Angeles
City of San Diego
Santa Monica
City of Berkeley
See Next Page
Parking requirements reduced by .25 spaces
Per dwelling unit for Transit Area or Very Low
Income housing (Municipal Code 14205)
R tluCes parking for two 6edroarn affaFc 4b1e ;`
hou_6 unlfs'from 2 paces 0f&. rt fo 1
spayasp�rUnit;,(&eaf,ah�'Os_1ptJgrpppi ,
In R-4 district, parking requirements are 1 per
1,000 ft of gross floor area. This reduces the
penalty that minimum parking requirements
typically have on smaller units. (Section
23D.40 0801
In RE-4, R$D and C 3 D>strinfS
Ness Specldl use Dlsfpdtj, parking rqulrem�nl"
is reduced to I space ner 4 ,.,h,+e
Lower Parking
For 1 bedrooms and studios only, San Jose has
San Jose a 0.5 spaces per unit reduction
Requirements for
in MPRs when
a facility is "All Open Parking" vs. "One -Car' or
Unassigned Parking Lots
'Two -Car Garage" (Municipal Code 20 12.215)
versus Assigned Parking
Spaces
If open lot, parking requirements are 0.3 to 0.4
spaces per p
Sunnyvale- P unit lower than developments
using one -fully enclosed garage. (Municipal
Code 19 46 050)
Allowing Re identldl
)MA�tp Glofd q, V ty;- PQss 1r;fvy��n 20,tilld 4Sf� r,�
�1
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
_
PH: M-480-1249 www scanah ora
-7-
E1tiYAff4NRr,$` ������
to Pw aY�ti� (+nf1 �dr '
,��twsJ�11y
Tray§lt Na
Re'sidentsdha:Discourit:
..,,
One -fifth the regular parking requirement for
housing specifically designed for and
San Francisco
occupied by senior citizens or physically
"By -right" reductions in
handicapped persons. (Article 1.5. Section
parking requirements for
151)
Senior and disabled
housing
25% reduction of parking requirement for
housing exclusively for persons over the age of
Berkeley
sixty-two (62). One space per 5 residents for
nursing homes. (Section 23D.40.080)
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd. Suite 1005, Los Angeles, CA 90010
PH:213-480-1249 www.scanoh.ora
IM.
City of Los Angeles Municipal Code
Chapter 1, General Provisions & Zoning
Section 12.22 A 25 (d)
25. Affordable Housing Incentives/Density Bonuses.
(d) Affordable Housing Production Incentives.
Notwithstanding any provisions of this article to the contrary, density bonus
Projects, and other development projects with any restricted affordable units or
any affordable accessible units, shall be granted the following incentives:
(1) In calculating dwelling units or guest rooms, density shall be rounded
upwards from fractions of one-half (1/2) and more from that permitted by the
applicable zone to allow one additional dwelling unit or guest room.
(2) Parking requirements for each restricted affordable unit only shall be as
follows:
For a project located
within 1,500 feet of a mass
transit station or major bus
route
For a project containing 1
or 2 habitable rooms and
not to-cated within 1,500
feet of a transit station or
major bus route
For a project containing 3
or more habitable rooms
and not located within
1,500 feet of a transit
station or major bus route
For any project containing
units designed for senior
citizens and/or disabled
persons
For a single -room
occupancy hotel
1.00 parking space per
dwell-ing unit, regardless
of the number of
habitable rooms
1.00 parking space per
dwell-ing unit
1.50 parking spaces per
dwelling unit
I0.50 parking space per
dwell-ing unit "or guest
room
0.25 parking space per
dwell-ing unit or guest
room, with a minimum of 5
parking stalls per facility
Southern California Association of Non -Profit Housing
3345 Wilshire Blvd, Suite 1005, Los Angeles, CA 90010
PH: 213-480-1249 www_ scan�4h oro
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RE: W Of binmente on Proposed 46 tlnR-Affordabie Housing Development
L ii.dt 46fi6 52nd Dt(ve—,Vembn,.CA 90068
DearM�:Wllson: ,
We heVe reviewed the City of Vemon'B Mitigated Negative Declaration for the proposed
abdVementfoned'project. While we do not oppose th
comments conoems: e project, we do have the fallowing
-JeRVI ar Sf1e.:suoJect property.
Th • e, site plan 8howe a fence lot :Ated, right _along the front property line. As the City of
Maywood has residential unity immediately to the south of this property, we are
recommending that any fencing be located behind a front landscaped setback area.
Fent ing material and height should elk be called out on the site plan.
• Theassessor;:paroal map shoWe 62nd.DriJe.ae a 60 foot wide street. The site plan
indieatee that the Property -line starts 25 0 i from the street centerline to the subject site
property line, if landsoapin le proposed in -front of the propoeetl fence, that would be
wRhin.the City of Vernon �Igftt=oRvvay, Wh'o;will maintain this landscaped setback area?
• PleBee provitla us with an' actual full .scale. site plan which shows fencing materials,
inclutling .driveway gates, locatlon of Igng Avenue (will the proposed driveway line up
I.nrith`thie street?), proposed front landscaped setback (front landscape plan) and public
improvements, I.e. existing telephone poles, along 52nd Drive.
• Please provide us with a saitham elevation of the proposed project (street view from
52n4`Drive).
• Under Section 4.15 Transportation and Traffic, the Mitigated Negative Declaration
states, under Sections ad, that there are No Impacts. The CRY of Vemon's acceptable
level of service Is D, while the City of Maywood's acceptable level of service for local
streets is C. 52nd Drive In Maywood is a local street. According to the City of
Maywood's Rnal EIR Land Use and Circulation Elements, In accordance with the CRy's
LOS standard, which Is LOS D for arterial and collector streets, study intersections that
deteriorate to LOS E or worse are signRicantly impacted and mitigation is required.
• The Traffic Study does not clearly address the future level of service at the intersection
of 52nd Drive and Atlantic Blind. It does, however, address the intersection of District
Blvd.. and Atlantic Blvd. with a projected level of service between E and F.
"ga/3 - 33
City of Vernon
NOTICE OF PUBLIC HEARING
4305 Santa Fe Avenue
Vernon, CA 90058
(323) 583-8811
ADOPTION OF'A MITIGATED NEGATIVE DECLARATION AND
MITIGATON MONITORING REPORTING. PROGRAM
AND
ADOPTION OF AMENDMENTS TO THE CITY OF VERNON GENERAL PLAN AND ZONING
ORDINANCE, AND APPROVAL OF A DEVELOPMENT AGREEMENT FOR A PROPOSED
HOUSING "DEVELOPMENT LOCATED AT 4675 5211D DRIVE IN THE CITY OF VERNON,
CALIFORNIA (THE "PROJECT")
NOTICE IS HEREBY GIVEN thattlie City of Vernon City Council will hold a Public Floating at 9:00 A.m.
on Tuesday, February 5, 2013, at City hall in the City Council Chambers, 4305 Santa. Fe Avenue, Vernon,
California. no purpose of the hearing is to consider the following matters:
Adoption of a Mitigated Negative Declaration and Mitigation Monitoring Reporting
Program. Pursuant to Public Resources Code Section 21000 of seq. and Government Code
Section 15000 et seq., the City of Vernon prepared an Initial Study to analyr-e the potential
environmental impacts associated with the proposed Project, and the City has determined that
with mitigation measures incorporated, project impacts can be reduced to a less than significant
level. A Mitigation Monitoring Reporting Program has been prepared identifying the
monitoring requirements and documentation.
Focused Amendments to Use Element oftheGeneralPlan. Consider and approve
proposed Amendments to establish a Housing Overlay and an Emergency Shelter Overlay.
Update of the,Housing Element for the2014-2021 Planning Cycle. Consider aid approve
Amendments to the Housing Element of the General Plan to address the requirementsfor the
2014: 2021 Housing Element cycle of the Southern California Association of Governments
region, and to identify sites for potential housing consistent with the Land Use Element.
Focused AnteudmeotstoChapter 26 (Zoning) of the Code of the City of Vernon and the
Zoning Map. Consider and approve an Ordinance amending sections of Chapter 26 to achieve
consistency with the general Plan and in particular,, to establish aHousing Overlay zone and an
Emergency Shelter Overlay zone, and to amend the Zoning Map to apply the two overlay zones.
Development Agreement. Consider and approve an Ordinance establishing a Development
Agreement between the City of Vernon and Meta Rousing Corporation for development of a
housing project at 4675 52'a Drive in the City of Vernon, California.
ALL INTERESTED AND/OR AFFECTED PARTIES are invited to submit written comments in favor of,
or in opposition to, this matter prior to the fine of the heat'y'n or be heard in support of, or opposition to, the
proposed project at the time of the hearing. For inl'orfnatio please contact Kevip Wilson, Community
Services and Water Director at (323) 583-8811,
Date: ,-�f�,A