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CDC - Item 4 - Garvey Avenue Senior Citizen ComplexECONOMIC DEVELOPMENT Memorandum To: Bill Crowe, Executive Director REDEVELOPMENT From: Stephen Copenhaver, GRC REAL ESTATE CONSULTING Date: July 31, 2002 AFFORDABLE HOUSING Subject: Rosemead Commtuty Development Commission consideration of the following actions for the Garvey Avenue Senior Citizen Complex: 1) Assistance and Operating Agreement; 2) Quit Claim of the Rosemead Community Development Commission's interest in the Site. Attached please find a copy of: 1) a Ground Lease by and between the City of Rosemead and the Rosemead Housing Development Corporation ("RHDC"); and 2) an Assistance and Operating Agreement between the City of Rosemead, the Rosemead Housing Development Corporation, and the Rosemead Community Development Commission ("Commission'). The purpose of these documents is to set forth, in contract form, the responsibilities of the ,City, Commission, and the RHDC in the development and operation of the Garvey Avenue Senior Housing complex. The form of the agreements and the ownership and financing structure of the Garvey Avenue project is similar to that utilized for the Angelus Senior Housing complex. The only significant difference in the financing of the two senior projects is that the Garvey Avenue project also benefits from federal funds which were used to help acquire the property. h~ Under the proposed financial structure, the Commission is responsible for both the cost. of development, and after development, any shortfall in operating costs experienced by the RHDC. It is anticipated that all funds expended by the Commission will be from low and moderate income housing set-aside funds. The project ownership structure assumes that the City of Rosemead will hold title to the property and that the Commission will quit claim its interests in the property to the City. The RHDC will lease the property from the City and operate the project as a low-income housing project. Ground Lease payments are initially set at $6,000 per month and escalate at the higher of 2% or the percentage increase in the Consumer soo s. KRAEMER BLVD. Price Index annually. The City may require that the site be re-appraised every five years and set the rent at 10% of the appraised value. The term of the Ground Lease is SUITE 365 55 years. The property and all improvements will revert back to the City at the termination of the Ground Lease. BREA, CA 92821 T: (714) 985-2880 F: (714) 985-2885 COMMISSION AGENDA AUG ? 3 2002 R EIS No. 1~ July 16, 2002 Page 2 The Levine Property Management Company will handle day-to-day management duties for the RHDC and prepare all financial statements, and annual tenant income verifications. Recommendation It is recommended that the Rosemead Community Development Commission: 1) Approve the Assistance and Operating Agreement; 2) Approve quit claim of the Rosemead's Community Development Commission's interest in the housing parcel and authorize the Executive Director to execute the necessary documents. PRECORDING REQUESTED BY AND WHEN RECORDED MAIL TO ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION AND THE CITY OF ROSEMEAD ATTENTION: CITY CLERK/COMMISSION SECRETARY Rosemead, California (Space above for Recorder.) This Agreement is recorded at the request and for the benefit of the Rosemead Community Development Commission and the City of Rosemead, California and is exempt from the payment of a recording fee pursuant to Government Code Section 6103. ASSISTANCE AND OPERATING AGREEMENT THIS ASSISTANCE AND OPERATING AGREEMENT (the "Agreement" hereinafter) is entered into this day of 2002, by and between the ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION, a public body corporate and politic (the "Commission" hereinafter), the CITY OF ROSEMEAD, CALIFORNIA, a municipal corporation (the "City") and ROSEMEAD HOUSING DEVELOPMENT CORPORATION, a California non-profit corporation ("RHDC" hereinafter), with reference to the following: RECITALS A.' Commission is a public body corporate and politic, exercising governmental functions and powers and organized and existing under the Community Redevelopment Law of the State of California. B. City is a municipal corporation organized and existing in the State of California. Assistance and Operating Agreement Page 1 C. RHDC is non-profit California corporation formed for and dedicated to constructing and operating housing within the City of Rosemead which is available at an affordable housing cost to persons and families of very low-income. D. City is fee owner of record of that certain real property (the "Site" hereinafter) located in the City of Rosemead, County of Los Angeles, State of California legally described in Attachment No. 1 attached hereto and incorporated herein by this reference. The Site is the subject of a "Ground Lease" by and between the City and RHDC which provides for the lease of the Site to RHDC and the operation and maintenance thereon of an affordable senior citizen rental housing project on the Site (the Project" hereinafter). The Ground Lease is attached hereto and incorporated herein by this reference as Attachment No. 2. The execution and recordation of this Agreement is a requirement of the Ground Lease. E. This Agreement is entered into by Commission, City and RHDC to encourage the operation of elderly and handicapped housing units available at an affordable housing cost to individuals having a gross income of less than forty percent (40%) of the area-wide median income. F. Commission and City's assistance to cause the Project and RHDC's operation of the Project on the Site, and the fulfillment generally of this Agreement, are in the best interest of the City of Rosemead and the welfare of its residents, and in accordance with the public purposes and provisions of applicable Federal, State and local laws and requirements. NOW, THEREFORE, Commission, City and RHDC agree as follows: Assistance and Operating Agreement Page 2 AGREEMENT 1. ARTICLE 100 COMMISSION ASSISTANCE A. Section 101 Commission Pre-development, Development and Operating Assistance The Commission shall bear the following costs and expenses related to the Project: 1) "Pre-development", "Construction costs related to the Project", and "Pre-operating" costs; and 2) the "Shortfall" occurring between the "Gross Receipts" and the "Operating Expenses" of the Project, all as hereinafter defined. 1. Section 102 Grant of Pre-development, Construction, and Pre-operating Assistance Commission shall grant RHDC amounts sufficient to pay for the following defined "Pre-development", "Construction", and "Pre-operating" costs and expenses related to the Project as set forth here in the Agreement: "Pre-development Costs" means the following costs and expenses: a) all required third-party engineers, architects and other professionals and consultants required to complete the drawings, plans and specifications required by the City of Rosemead (the "Plans and Specifications" hereinafter); b) preparing bid documents, bidding, selecting and retaining the services of all required third-party contractors required to construct the Project and presenting such bid documents and bidders to the City and/or Commission for approval in accordance with this Agreement; c) securing City, Commission or RHDC approval of this Agreement and the Ground Lease (Attachment No. 2); d) permit processing fees and charges of the City and other governmental agencies having jurisdiction over the Project; and e) RHDC staff used in connection with any of the above activities calculated by dividing said staffs compensation, including salary and benefits and the City overhead rate, by the approximate percent of the employee's time expended on said activities. Assistance and Operating Agreement Page 3 "Construction Costs" means the costs and expenses incurred by the Commission to cause the construction of the project for the R.HCD including all third-party contractual costs, expenses and fees of any kind or nature in connection with constructing the Project on the Site, including without limitation contractor's overhead, labor and materials, machinery and equipment for site work, shell buildings, parking structures, interior and exterior improvements, purchasing and installing all signage, finishing, furniture, fixtures and equipment, landscaping, lighting, recreational facilities, public improvements and all other costs and expenses of construction. Construction Costs shall include the cost of RHDC staff used in connection with any of the above activities calculated by utilizing the same formula for RHDC staff as utilized for pre-development activities. "Pre-operating Expenses" means the costs and expenses incurred by RHDC for: a) selecting and retaining the services of an on-site "Manager", as defined hereinafter, for the Project and advertising for, screening and retaining all other personnel required to maintain and operate the Project; b) leasing the Project, including developing the rental agreement and other required documents, advertising the Project, screening applicants and conducting the selection process, as hereinafter defined; c) developing resident programs, operating procedures, rules and regulations, staffing requirements, a budget and other documents and programs required for the operation of the Project on the Site, and presentation of same to City and/or Commission as provided herein for approval; d) RHDC staff used in connection with any of the above activities calculated by dividing the said staffs compensation, including salary and benefits and City overhead rate, by the amount of time spent on said activities. As provided in Section 104 hereof, Commission shall budget unencumbered funds in the amount of the "Pre-development, Construction, and Pre-operating Budget" to be granted to RHDC to pay for the expenses enumerated hereinabove. RHDC agrees that all third-party contractors shall be paid for approved expenses in a timely fashion. RHDC and all parties with which it contracts hereunder shall maintain complete books, accountings and records showing in reasonable detail the activities performed and services provided with respect to the Project and Commission may, from time to time, request such books, accountings and records and reserves the right, at Commission's expense, to perform an audit of same by employing an independent auditor to conduct such audit. If Assistance and Operating Agreement Page 4 Commission's audit results differ in Commission's favor from the invoices for service submitted by such party, then Commission shall not be obligated to fund such difference and RHDC shall be obligated to repay such difference to Commission. RHDC hereby ensures that all contracts entered into by it with third-party contractors shall provide these rights to Commission. 2. Section 103 Operating Shortfall Reimbursement Commission shall reimburse RHDC for the "Shortfall" occurring between the "Gross Receipts" and the "Permitted Operating Expenses" of the Project as hereinafter defined. For the purposes of determining the "Shortfall", the following terms shall have the meanings hereinafter described: a) "Gross Receipts" shall mean any and all income and receipts actually received by RHDC in connection with the use, rental, occupancy and operation of the Project on the Site, including without limitation, all rental and other sums received from the "Tenants" for the rental of the "Units", as the terms are hereinafter defined, including amounts paid on account of late rental charges, forfeited deposits, various programs provided at the Project for the Tenants, and Tenant use of the laundry facilities. b) "Permitted Operating Expenses" shall mean those costs and expenses approved by Commission in the "Annual Budget" in place at the time a "Statement of Income and Expenses", is submitted by RHDC to Commission, all as described hereinbelow, and incurred by RHDC, including lease payments to the City pursuant to the Ground Lease (Attachment No. 2), expenses for utilities, personnel, supplies and equipment used in connection with the maintenance, repair, refurbishing and operation of the Project, including property management fees, program, promotional and leasing expenses, reserves for building maintenance and capital improvements, capital expenses and improvements to the Project and insurance required hereunder and by the Ground Lease (Attachment No. 2). Such "Shortfall" shall be determined on a quarterly basis, the first quarter commencing on that date which City issues a Certificate of Occupancy for the Project and ending on that date which is three (3) months thereafter. In this connection, RHDC shall prepare and submit to Commission within thirty (30) days following the culmination of each such quarter a "Statement of Income and Expenses" providing its accounting of the Shortfall Assistance and Operating Agreement Page 5 showing in detail how the Shortfall was calculated for such quarter and detailed breakdowns of the Gross Receipts and Permitted Operating Expenses. Such Statement of Income and Expenses shall be prepared consistent with generally acceptable accounting principles for multi-family residential projects. Commission shall have thirty (30) days from such submission to review RHDC's Statement of Income and Expenses, and to approve such Statement and reimburse RHDC for such Shortfall. RHDC shall maintain complete books, accountings and records showing in reasonable detail the Gross Receipts and the Permitted Operating Expenses for the Project. The Commission may request such books, accountings and records and reserves the right, at Commission's expense, to perform an audit of same by employing an independent auditor to conduct such audit. 3. Section 104 Management of Project; Management Selection RHDC shall manage or cause the Project to be managed in a prudent and businesslike manner, consistent with first-class, multi-family housing projects and in accordance with the terms of this Agreement. Commission shall have the right, at its sole and exclusive discretion, if Commission has good cause to believe that the Project is being mismanaged in accordance with the terms of this Agreement, to require that RHDC or its approved successor, terminate the services of a given Manager. 4. Section 105 Insurance RHDC shall maintain insurance policies as required by the City attorney, from time to time. Assistance and Operating Agreement Page 6 II. ARTICLE 200 USES A. Section 201 Use of the Site In recognition of City and Commission assistance to be provided hereunder, RHDC covenants and agrees for itself and its successors and assigns, and every successor in interest to the Site or any part thereof, that during construction and thereafter for the life of the Project, but not less than fifty-five (55) years from the date of the City's issuance of a Certificate of Occupancy for the Project (the "Term of the Covenants" hereinafter), RHDC and any approved successors and assigns shall use the Site exclusively for affordable very low income senior citizen rental housing and in accordance with this Assistance and Operating Agreement. III. ARTICLE 300 COVENANTS A. Section 301 Operating and Rental Covenants RHDC covenants and agrees to operate on the Site for the Term of the Covenants the Project consisting of one (1) and two (2) bedroom units designed for occupancy by an on-site "Manager", for rental to "Qualifying Tenants", as hereinafter defined, each of which shall be available at an "Affordable Housing Cost", as that term is hereinafter defined (the "Units" hereinafter). "Affordable Housing Cost" for the purposes of this Agreement shall mean the rental of the Unit, including a reasonable allowance for utility expenses, shall not exceed, forty percent (40%) of the median income adjusted by household size for the rental unit. Gross Income shall include, but not be limited to wages, salaries, overtime, commission, tips, bonuses, unemployment, disability, worker's compensation, severance pay, interest and dividends, social security, annuities, pensions, retirement funds, insurance policies, disabuiltiy or death benefits, alimony, child support, reular contributions or gifts from persons not occupying the unit, and any pulic assistance allowance, including armec service compensation. The Gross Income of each Tenant shall be determined initially by the application for occupancy and annually thereafter by the Executed Certification of Tenant Eligibility and Income Verification to be submitted on an annual basis by each Tenant substantially in a form consistant with the requirements in State and Federal Law. Assistance and Operating Agreement Page 7 RHDC further covenants and agrees: 1) to maintain the above-referenced Units at the stated Affordable Housing Cost for the Term of the Covenants; 2) to refrain from taking any action during such period which may cause the Site to cease to be used for Qualified Tenants, unless specifically required by law or otherwise provided in this Agreement; 3) to use reasonable and good faith efforts to maximize occupancy of the Units on the Site during such period; and 4) to operate uses on the Site only in conformity with all applicable Federal, State and Local laws. RHDC covenants and agrees for itself and its successors and assigns, and every successor in interest to the Site or any part thereof, that RHDC and such successors and assigns shall, subject to the requirements of applicable law, limit the rental of the Units in the Project to persons and households meeting the following minimum criteria: 1) is sixty-two (62) years of age or older for at least one occupant and 45-years or older for co-applicants with the exception of live-in attendants for the handicapped which may be any age; and 2) has a Gross Income of forty (40) percent or less of the area-wide median income adjusted for family size pursuant to Section 8 of the United States Housing Act of 1937 (42 U.S.C. Sec. 14370, or its successor, but in no event less than Eight Thousand Eight Hundred Dollars ($8,800) per year; and 3) ownership of no real estate other than a mobile home and having no more than Twenty Thousand Dollars ($20,000) in liquid assets, including but not limited to stocks, bonds, and cash deposits; and 4) a Rosemead resident for at least six (6) months preceding the date of submission of the application for residency, this criterion applying to each person occupying a Unit in the case of multiple-person households; and 5) maintains suitable health for independent apartment living; and 6) shall not have ;lived in another subsidized unit or benefited from any other rental assistance program for six (6) months prior to submitting an application for residency, and (7) is a qualified alien as defined in Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) or a U.S. citizen. For the purposes of this Agreement a cohabitant is a spouse, or person providing primary physical or economic support to the Qualifying Tenant. Temporary residency of a Unit shall also be permitted, at the request of the Qualifying Tenant or the Qualified Permanent Resident by a person of less than forty-five (45) years of age for a period of up to thirty (30) days in any year. To the extent permissible under State and Federal Laws Qualifying Tenants shall be selected on a first-come first-serve basis in order of submission of applications to the RHDC. Assistance and Operating Agreement . Page 8 All unselected households seeking to become tenants shall be placed on a waiting list and notified as Units become available for occupancy in the order of the waiting list. I Throughout the Term of the Covenants, RHDC shall do each and all of the following: 1) Obtain and maintain or cause to be obtained and maintained on file from each Tenant residing in the Project a copy of such Tenant's executed "Certification of Tenant Eligibility and Income Verification" in substantially the form as Attachment No. 3 attached hereto and incorporated herein by this reference. 2) Permit the Commission to inspect the books and records of RHDC or the management company designated pursuant to this Agreement. 3) Obtain and maintain on file for each Tenant residing in the Project a copy of such Tenant's federal income tax return for the taxable year immediately preceding such Tenant's initial occupancy in the Project or, if such tax return is unavailable, other evidence satisfactory to Commission of income for such year. 4) Prepare and submit to the Commission annually during the Term of the Covenants a "Certification of Continuing Program Compliance", in substantially the form attached as.Attachment No. 4 attached hereto and incorporated herein by this reference, executed by the RHDC and including the percentage of the residential Units of the Project which were occupied by Qualified Tenants at all times during the period since the filing of the last Certification of Continuing Program Compliance. The RHDC or its designated management company will attach to the Commission's copy of the Certification of Continuing Program compliance the Certifications of Tenant Eligibility and Income Verification and any tax returns received from the Tenants occupying Units in the Project. The form of Rental Agreement shall provide for termination of the Rental Agreement with any particular Tenant and consent by such person to immediate eviction for failure to qualify as a Qualified Tenant as a result of any material misrepresentation made by such person with respect to his or her income and income verification. RHDC covenants by and for itself and any successors in interest that there shall be no discrimination against, or segregation of, any persons, or group of person, on account of sex, race, color, creed, marital status, religion, handicap, national origin or ancestry in the enjoyment of the Site, nor shall RHDC itself, or any person claiming under or through it, Assistance and Operating Agreement Page 9 establish or permit 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 and shall remain in effect in perpetuity. RHDC shall refrain from restricting the rental, sale or lease of the Site on the basis of race, color, creed, religion, sex, marital status, ancestry or national origin of any person. All such deeds, leases or contracts shall contain or be subject to substantially the following nondiscrimination or nonsegregation clauses: 1) In deeds: "The grantee herein covenants by and for himself, his heirs, executors, administrators and assigns, and all persons claiming under or through them, that there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the grantee himself, or any persons claiming under or through him, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein conveyed. The foregoing covenants shall run with the land." 2) In leases: "The lessee herein covenants by and for himself, his heirs, executors, administrators and assigns, and all persons claiming under or through him, and this lease is made and accepted upon and subject to the following conditions: "That there shall be no discrimination against or segregation of any person or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the land herein leased nor shall the lessee himself, or any person claiming under or through him, establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or vendees in the land herein leased." 3) In contracts: "There shall be no discrimination against or segregation of any persons or group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national origin in the sale, lease, transfer, use, occupancy, tenure or enjoyment of Assistance and Operating Agreement Page 10 land, nor shall the transferee himself, or any person claiming under or through him, 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 premises." The foregoing nondiscrimination covenants shall remain in effect in perpetuity. IV. ARTICLE 400 A. Section 401 STANDARDS Operating Standards The Manager shall comply with the following standards (the "Standards" hereinafter): 1) Landscape maintenance shall include, but not be limited to: watering/irrigation; fertilization; mowing; edging; trimming of grass; tree and shrub pruning; trimming and shaping of trees and shrubs to maintain a healthy, natural appearance, replacement of diseased or deceased speciments, and safe road conditions and visibility, and not only providing optimum irrigation coverage but also complying with current water conservation techniques; replacement, as needed, of all plant materials; control of weeds in all planters, shrubs, lawns, ground covers, or other planted areas; and staking for support of trees. 2) Clean-up maintenance shall include, but not be limited to: maintenance of all sidewalks, paths and other paved areas in such clean and weed-free condition; maintenance of all such areas free of dirt, mud, trash, debris or other matter which is unsafe or unsightly; removal of all trash, litter and other debris from improvements and landscaping prior to mowing; clearance and cleaning of all areas maintained prior to the end of the day on which the maintenance operations are performed to ensure that all cuttings, weeds, leaves and other debris are property disposed of by maintenance workers. 3) All maintenance work shall conform to all applicable federal and state Occupational Safety and Health Act standards and regulations for the performance of maintenance. Assistance and Operating Agreement Page 11 4) Any and all chemicals, unhealthful substances, and pesticides used in and during maintenance shall be applied only by persons possessing valid California applicators license, and in strict accordance with all governing regulations. Precautionary measures shall be employed recognizing that all areas are open to public access. 5) The Project shall be maintained in good condition and in accordance with the . custom and practice generally applicable to comparable first-class multi-family projects in Los Angeles County, California. The Project shall be maintained in conformance and in compliance with the approved construction and architectural plans and design scheme, as the same may be amended from time to time with the written approval of Commission (and the City, if such approval is required) and reasonable first-class multi-family housing maintenance standards. V. ARTICLE 500 COMPLIANCE WITH LAW A. Section 501 RHDC Compliance with Federal,.State and Local Laws RHDC shall comply with all local, state and federal laws relating to the uses or condition of the Site, private improvements and public improvements. If any new local laws relating to the uses of or condition of the improvements create a condition or situation that constitutes a lawful nonconforming use as defined by local ordinance with respect to the Site or any portion thereof, then so long as the lawful nonconforming use status remains in effect (i.e., until such lawful status is property terminated by amortization as provided for in the new local law or otherwise), RHDC and the Manager shall be entitled to enjoy the benefits of such lawful nonconforming use pursuant to the lawful nonconforming uses ordinance. VII. ARTICLE 600 COVENANTS RUN WITH THE LAND; VIOLATION OF COVENANTS; REMEDIES A. Section 601 Covenants Run with the Land Whenever the word " RHDC is used herein, it shall include any and all successors or assigns, and the provisions hereof are expressly binding upon all such successors or assigns, and the parties agree all such provisions shall run with the land. Commission shall cause a fully executed copy of this Agreement to be recorded in the Office of the Los Angeles Assistance and Operating Agreement Page 12 County Recorder. Notwithstanding the foregoing, in the event RHDC or its successors or assigns, shall convey its interest in all or any portion of the Site, they shall be free from and after the date of recording such conveyance of all liabilities, respecting the performance of the restrictions, covenants or conditions contained in this Agreement thereafter to be performed with respect to the Site, or any part thereof, it being intended that the restrictions, covenants and conditions shall be binding upon the successors or assigns, provided that the conveying party shall remain liable for any actions prior to the date of conveyance. The covenants established in this Agreement shall, without regard to technical classification and designation, be binding for the benefit and in favor of the Commission and/or the City, its successors and assigns, as to those covenants which are for their benefit. Commission and/or City are deemed the beneficiaries of the terms and provisions of this Agreement and of the Covenants running with the land, for and in their own rights and for the purposes of protecting the interests of the community. The Agreement and the covenants shall run in favor of the Commission and/or the City without regard to whether the Commission and/or the City has been, remains, or is an owner of any land or interest therein in the Site. Commission and City shall have the exclusive right, if this Agreement or covenants 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 maybe entitled. VIII. ARTICLE 700 MISCELLANEOUS PROVISIONS A. Section 701 Event of Destruction of Project; Extended Coverage and Casualty Insurance RHDC shall have no obligation to repair or replace any improvements which are damaged or destroyed by fire or other casualty except to the extent of insurance proceeds available to RHDC for such purpose. In this connection; RHDC shall maintain fire and extended coverage casualty insurance (excluding flood and earthquake) for the buildings and structural improvements on the Site for the full replacement cost thereof for the Term of the Covenants. Assistance and Operating Agreement Page 13 Issuance of a Certificate of Occupancy by the City for the Project shall not affect RHDC's obligations under this Section. The foregoing covenants shall remain in effect for the Term of the Covenants. i Assistance and Operating Agreement Page 14 B Section 702 _ Rights of Access .a Commission and City, at their sole risk and expense, reserves the right to enter the Site or any part thereof at all reasonable times during ordinary business hours for the purpose of construction, reconstruction, maintenance, repair or service of any public improvements or public facilities located on the Site, or monitoring RHDC's compliance with the terms and conditions of this Agreement. C. Section 703 Severability If any provision of this Agreement or portion thereof, or the application to any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the remainder of this Agreement, or the application of such provision or portion thereof to any other-persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid provision affects the consideration for this Agreement; and each provision of this Agreement shall be valid and enforceable to the fullest extent permitted by law. D. Section 704 Agreement Binding on Successors and Assigns 1 The covenants and agreements established in this Agreement shall, without regard to technical classification and designation, be binding on the RHDC and any successor in interest to this Agreement, the Site, or any part thereof, for the benefit of and in favor of the Commission, its successor and assigns, and the City. The covenant, with the exception of the nondiscrimination covenants hereof which shall remain in effect in perpetuity, shall remain in effect for the life of the Project, but in no event for less than fifty-five (55) years from the date of the City's issuance of a Certificate of Occupancy for the Project. Assistance and Operating Agreement Page 15 E. Section 705 Prohibition Against Transfer or Assignment of Agreement No voluntary or involuntary successor in interest of RHDC shall acquire any rights or powers under this Agreement except as expressly set forth herein. From the Effective Date of this Agreement through to the expiration of the Term of the Covenants, RHDC shall not assign any of RHDC's rights or obligations under this Agreement without the prior written consent of Commission having been obtained. In the event of an assignment in violation hereof, or of the Ground Lease with City, Commission's obligation to make the payments described in Article 100 hereof shall cease, or may be amended, at the sole and exclusive discretion of Commission. G. Section 707 Effective Date of Agreement The "Effective Date" of this Agreement shall be the Ground Lease (Attachment No. 2), as specified therein. H. Section 708 Amendment or Waiver of Agreement This Agreement may be amended, or any provision hereof -waived, only by written instrument executed by the parties hereto. 1. Section 709 Consistency with Tax Credits To the extent this Agreement is inconsistent with Tax Credit Allocation Committee ("TCAC") regulatory agreement regarding incomes and rents, compliance with the TCAC regulatory agreement shall constitute compliance with this Agreement. Assistance and Operating Agreement Page 16 IN WITNESS WHEREOF, the Commission, City and the RHDC have executed this Agreement. Dated: 2002 COMMISSION By: Chairman CITY By: Mayor RHDC By: Chairman APPROVED AS TO FORM: By: Commission Counsel City Clerk City Attorney Assistance and Operating Agreement Page 17 By: ATTEST: Commission Secretary ATTEST: By: By: STATE OF CALIFORNIA ) ) ss. COUNTY OF LOS ANGELES ) On , 2002, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed this instrument as the Chairman and Commission Secretary, . respectively, of the ROSEMEAD COMMUNITY DEVELOPMENT COMMISSION, and acknowledged to me that said Commission approved and executed it. WITNESS my hand and official seal. (SEAL) STATE OF CALIFORNIA ) ) ss. COUNTY OF LOS ANGELES . ) On . , 2002, before me, the undersigned, a Notary Public in and for said State, personally appeared" and personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed this instrument as the Mayor and City Clerk, respectively, of the CITY OF ROSEMEAD, and acknowledged to me that said City approved and executed it. WITNESS my hand and official seal. (SEAL) Assistance and Operating Agreement Page 18 STATE OF CALIFORNIA ) . ) ss. COUNTY OF LOS ANGELES ) On , 2002, before me, the undersigned, a Notary Public in and for said State, personally appeared and , personally known to me or proved to me on the basis of satisfactory evidence to be the persons who executed this instrument as the of the ROSEMEAD HOUSING DEVELOPMENT CORPORATION, and acknowledged to me that said Corporation approved and executed it. WITNESS my hand and official seal. (SEAL) Assistance and Operating Agreement Page 19 ATTACHMENT NO. 1 Legal Description [Legal Description on file with City Clerk] i i Assistance and Operating Agreement Page 20 ATTACHMENT NO. 2 Ground Lease Assistance and Operating Agreement Page 21 ATTACHMENT NO. 3 TENANT CERTIFICATION OF ELIGIBILITY AND INCOME VERIFICATION Part I General Information 1. Project Name 2. Project Location 3. Landlord's Name Part II - Unit Information 7. Unit No. 8. Mo. Rent $ 9. No. of Bedrooms 10. No. of Occupants Part III Affidavit of Renter I, and I, as applicants for rental of an Affordable Unit in the above-described Project, do hereby represent and warrant as follows: A. (My/Our) adjusted income (anticipated total annual income) does not exceed forty percent (40%) of the area-wide median income for the Los Angeles Primary Metropolitan Statistical Area as such income levels are established and amended from time to time pursuant to Section 8 of the United States Housing Act of 1937 and published by the State Department of Housing and Community Development in the California Administrative Code Assistance and Operating Agreement Page 22 and is not less than Eight Thousand Eight Hundred Dollars ($8,800.00). (UWe) understand r. that the applicable median gross income is $ The following computation includes all income (Uwe) anticipate receiving for the twelve (12) month period beginning on the date (Uwe) execute a rental agreement for an Affordable Unit or the date on which (Uwe) will initially occupy such unit, whichever is earlier. For the renter and all family members, include: (a) amount of wages, salaries, overtime pay, commission, fees, tips and bonuses, and payments in lieu of earnings, such as unemployment and disability compensation, workers' compensation and severance pay (before payroll deductions) $ (b) net income from business or profession or rental of property (without deduction for repayment of debts or expansion of business) $ (c) interest and dividends $ (d) periodic receipts such as social security, annuities, pensions, retirement funds, insurance policies, disability or death benefits, alimony, child support, regular contributions or gifts from persons not occupying the unit $ (e) public assistance allowance or grant plus excess of maximum allowable for shelter or utilities over the actual allowance for such purposes $ (f) regular or special pay and allowances of a member of armed services (whether or to living in the dwelling) who is head of the family or spouse $ Total Eligible Income: $ Note: The following items are not considered income: casual or sporadic gifts; amounts specifically for or in reimbursement of medical expenses; lump sum payment such as inheritances, insurance payments, capital gains and settlement for personal or property Assistance and Operating Agreement Page 23 losses; educational scholarships paid directly to the student or education institution; government benefits to a veteran for education; special pay to a servicemen head of family away from home and under hostile fire; foster child care payments; value of coupon allotments for purpose of food under Food Stamp Act of 1964 which is in excess of amount actually charged the eligible household; relocation payments under Title Il of Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970; payments received pursuant to participation in the following programs: VISTA, Service Learning Programs, and Special Volunteer Programs, SCORE, ACE, Retired Senior Volunteer Program, Foster Grandparent Program, Older American Community Services Program, and National Volunteer Program to Assist Small Business Experience. 2. This affidavit is made with the knowledge that it will be relied upon by the Landlord to determine maximum income for eligibility and (Uwe) deem reliable and that the estimate contained in paragraph 1 is reasonable and based upon such investigation as the undersigned deemed necessary. 3. (I/We) will assist the Landlord in obtaining any information or documents required to verify the statements made in this Part III and have attached hereto copies of federal income tax returns for the past two years. 4. (I/We) acknowledge that (1/we) have been advised that the making of any misrepresentation or misstatement in this affidavit will constitute a material breach of (my/our) agreement with the Landlord to rent the unit and will additionally enable the landlord to initiate and pursue all applicable legal and equitable remedies with respect to the unit and to (me/us). (I/We) do hereby swear under penalty of perjury that the foregoing statements are true and correct. Date . Applicant SUBSCRIBED AND SWORN TO before me this day of (Notary Seal) Assistance and Operating Agreement Page 24 Notary Public in and for the State of California My Commission Assistance and Operating Agreement Page 25 INCOME VERIFICATION (For Social Security Recipients) TO: SOCIAL SECURITY ADMINISTRATION Ladies and Gentlemen: I have applied for an affordable senior housing rental unit located in a redevelopment housing project in the City of Rosemead. Every income statement of a prospective tenant must be stringently verified. Therefore, in connection with my application for a rental unit, I hereby give my consent to release to the Rosemead Housing Development Corporation, the City of Rosemead or the Rosemead Community Development Commission the specific information requested below. SIGNED: SOCIAL SECURITY NUMBER: NAME: CURRENT ADDRESS: PHONE: DATE: DATE SOCIAL SECURITY MONTHLY BENEFITS BEGANIWILL BEGIN: SOCIAL SECURITY MONTHLY BENEFIT AMOUNT $ OTHER BENEFITS (Describe and list dollar amount): $ MEDICARE DEDUCTION: $ ARE BENEFITS EXPECTED TO CHANGE: Yes No Assistance and Operating Agreement Page 26 IF YES, PLEASE STATE DATE AND AMOUNT OF CHANGE: DATE: AMOUNT: IF RECIPIENT IS NOT RECEIVING FULL BENEFIT AMOUNT, PLEASE INDICATE REASON AND DATE RECIPIENT WILL START RECENING FULL BENEFIT AMOUNT: REASON: DATE-OF RESUMPTION: SIGNED: NAME: PHONE: PLEASE RETURN FORM TO : TITLE: DATE: AMOUNT: $ S Assistance and Operating Agreement Page 27 ATTACHMENT NO.4 CERTIFICATION OF CONTINUING PROGRAM COMPLIANCE The of the Rosemead Housing Development Corporation (the "RHDC"), hereby represents and warrants that: 1. He/she has read and is thoroughly familiar with the provisions of the Assistance and Operating Agreement (the "Agreement") by and between the Rosemead Community Development Commission, the City of Rosemead and RHDC of which this certification is an attachment. 2. He/She is authorized by RHDC to complete this form. 3. As of the date of this certificate, the following numbers of completed residential units in the Project are (1) occupied by Qualifying Tenants (as such term is defined in the Agreement) or (2) occupied by a Qualifying Tenant which is also handicapped (as set forth in the Agreement) or (ii) are currently vacant since the date a Qualifying Tenant vacated such unit, as indicated: Occupied Qualifying Tenants No. of Units 11 Occupied by Handicapped Tenants: No. of Units Vacant: No. of Units: By: Title: Assistance and Operating Agreement Page 28 Rosemead Community Development Commission Ogn, CA g177p Te1626.569.2100 Fax 626.307.9218 R(D( gg38 East Valley Boulevard, COMMISSION MEMORANDUM EXECUTIVE DIRECTOR FROM: DATE: AUGUST 12, 2002 VEY pROJLCT ~ ~ COMMISSION AGENDA ITEM-G~ RE: AUGUST 13, _00_ enda refers to a Ground Lease X002 Ag The staff reportfor the attached- Project on the August 13 , _ document that . not . The staff reports for the City and the Rosemead Housing oration both include copies of the Ground Lease. Attached is another copy Development Corporation your Commission Agenda- for If you have any questions, please let me know.