HDC - Item 2 - Consideration of Ground Lease by and Between The City of Rosemead and The Rosemead HDCr
ASSOCIATES ZINC?
M
ECONOMIC DEVELOPMENT
REDEVELOPMENT
REAL ESTATE CONSULTING
'AFFORDABLE HOUSING
To: Bill Crowe, Executive Director
From: Stephen Copenhaver, GRC
Date: July 31, 2002
M
Subject: Rosemead Housing Development Corporation consideration of
the.following actions for the Garvey Avenue Senior Citizen
Complex:
1) Ground Lease by and between the City of Rosemead and
the Rosemead Housing Development Corporation;
2) Assistance and Operating Agreement, .
Soo S. KRAEMER BLVD.
SUITE 365
BREA, CA 92821
T.(714)985 -2880
'(714) 985 -2885
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. .
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
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
55 years. The property and all improvements will revert back to the City at the
termination of the Ground Lease.
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.
HOUSING AGENDA
AUG 13
ITE No. c�•
July 16, 2002
Page 2
Recommendation
It is recommended that the Rosemead Housing Development Corporation:
l) Approve the Ground Lease with the City of Rosemead;
2) Approve the Assistance and Operating Agreement 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
I. 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 RECD 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 REDC 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
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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
herembelow, 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 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.
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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.
1437f), 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.
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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.
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 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,
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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 STANDARDS
A. Section 401 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.
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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 1 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
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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 may be 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
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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.
Assistance and Operating Agreement
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B Section 702 Rights of Access
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
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.
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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.
I. 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.
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IN WITNESS WHEREOF, the Commission, City and the RHDC have executed this
Agreement.
Dated: 1 2002
COMMISSION ATTEST:
By:
Commission Secretary
ATTEST:
0
City Clerk
City Attorney
Assistance and Operating Agreement
Page 17
Chairman
CITY
By:
Mayor
RHDC
By:
Chairman
APPROVED AS TO FORM:
By:
Commission Counsel
By:
Commission Secretary
ATTEST:
0
City Clerk
City Attorney
Assistance and Operating Agreement
Page 17
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]
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 1I -- Unit Information
7. Unit No.
9. No. of Bedrooms 10
S. Mo. Rent S '
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). (I/We) understand
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.
1. 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 (Uwe) 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 expires:
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:
DATE:
CURRENT ADDRESS:
PHONE: �) _
DATE SOCIAL ' SECURITY MONTHLY BENEFITS BEGAN/WILL 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 RECEIVING FULL BENEFIT
AMOUNT:
REASON:
DATE OF RESUMPTION:
SIGNED:
NAME:
PHONE: ()
PLEASE RETURN FORM TO:
TITLE:
DATE:
AMOUNT: $
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
Occupied by Handicapped Tenants: No. of Units
Vacant: No. of Units:
0
Title:
Assistance and Operating Agreement
Page 28
GROUND LEASE
by and -between
CITY OF ROSEMEAD, CALIFORNIA (the 'City ")
and
ROSEMEAD HOUSING DEVELOPMENT CORPORATION,
A CALIFORNIA NON - PROFIT CORPORATION ("RHDC ")
This Lease is made and entered into by and between the CITY OF ROSEMEAD, a
municipal corporation, hereinafter referred to as "City" and ROSEMEAD HOUSING
DEVELOPMENT CORPORATION, a Califomia non -profit corporation hereinafter referred
to as "RHDC ".
1. Definitions of Land and Development
City hereby leases to RHDC and RHDC leases from City that certain site in the
City of Rosemead, County of Los Angeles, State of California described on the "Legal
Description" and shown on the "Site Map" attached hereto and incorporated herein by this
reference as Exhibit Nos. 1 and 2 , respectively (the "Land "). The 'Development" shall include
the Land and a 72 -unit senior citizen complex to be constructed thereon as approved by the
City of Rosemead.
2. Term
The "Term" of this Lease shall be for fifty -five (55) years, commencing on the
Effective Date of this Lease.
3. Rent
For the period commencing with the Effective Date of the Lease to the
expiration of the Term hereof, RHDC agrees to pay City rental, without prior notice or demand
by City, in the sum of Silt Thousand Dollars ($6,000.00) per month in advance on or before the
monthly anniversary date of the Effective Date of the Lease (the "Monthly Anniversary Date"
hereinafter) for each calendar month during the term of this Lease. Said rental shall be paid to
City, without deduction or offset, in lawful money of the United States of America, and such
Ground Lease
Page 1 of 8
payment may be made by means of a check or similar instrument payable to City. City and
RHDC hereby agree that said rental amount is equivalent to ten percent (10 %) of the fair
market value of the Land at the date of City's issuance of a Certificate of Occupancy for the
Development. City may require RHDC to have the Land appraised by an appraiser mutually
selected by City and RHDC every five (5) years to determine the then fair market value of the
Land, and the rental amount shall be increased to ten percent (10 %) of such appraised fair
market value, providing that it is higher than the prior year's rent. Additionally, each twelve
(12) month period following the City's issuance of a Certificate of Occupancy for the
Development (the "Annual Anniversary Date" hereinafter), the rental amount shall be
increased two percent (2 %) per year, or by the percentage increase in the Consumer Price
Index, whichever is higher.
4. Use of Development
The Land leased hereby shall be utilized by RHDC for the purpose of operating
the Development thereon. RHDC shall not use or permit the Development or any part thereof
to be used for any purpose or purposes other than the purpose or purposes for which the Land
is hereby leased. The Development shall be operated in accordance with the Assistance and
Operating Agreement by and among City to which this Lease is an attachment (the "Assistance
and Operating Agreement" hereinafter).
5. Insurance Rates
No use shall be made or permitted to be made of the said Development, nor
acts done, which will increase the existing rate of insurance, or cause a cancellation of any
insurance policy covering said Development, or any part thereof, nor shall RHDC sell, or
permit to be sold, kept, or used, in or about said Development, any article which may be
prohibited by the standard form of fire insurance policies. RHDC shall, at its sole cost and
expense, comply with any and all requirements, pertaining to said Development, of any
insurance organization or company, necessary for the maintenance of reasonable fire and public
liability insurance, covering said Development and appurtenances.
6. Waste
RHDC shall not commit, or suffer to be committed, any waste upon the
Development, or any nuisance, or other act or thing which may disturb the quiet enjoyment of
any tenant in the building.
7. Alterations
Ground Lease
Page 2 of 8
RHDC shall not make, or suffer to be made, any alterations in excess of
$100,000 to said Development, or any part thereof, without the prior written consent of City,
and any additions to, or alterations of, the said Development, except movable furniture and
trade fixtures, shall become at once a part of the realty. RHDC shall keep the Development
free from any liens arising out of any work performed, material furnished, or obligations
incurred by RHDC.
8. Utilities
RHDC shall pay for all gas, heat, light, power, water, telephone service, and all
other services supplied to the Development and assume responsibility for all electricity and
plumbing.
9. Abandonment
RHDC shall not vacate or abandon the Development at any time during the
term; and if RHDC shall abandon, vacate, or surrender said Development, or be dispossessed
by process of law, or otherwise, any personal property belonging to RHDC and left in the
Development shall be deemed to be abandoned, at the option of City, except such property as
may be mortgaged to City.
10. Maintenance
RHDC shall, at its sole cost, keep and maintain said Development and
appurtenances and every part thereof, including windows and skylights, and sidewalks adjacent
to said Development in good and sanitary order, condition and repair.
H. Acceptance of the Land
By entry hereunder, RHDC accepts the Site as is, and agrees on the last day of
the Term hereof, or sooner termination of this Lease, to surrender unto City said Development
with said appurtenances in good condition less reasonable use and wear thereof and damages
by fire, act of God or by the elements excepted, and to remove all of RHDC's signs and
personal property from said Development.
12. Insurance Requirements
RHDC agrees to maintain liability insurance in the amounts recommended by
the City Attorney and confirmed by the City Council to be commensurate with the level of risk.
13. Damages caused by Others
Ground Lease
Page 3 of 8
City shall not be liable for any temporary failure of supply of water, gas, heat,
light, power, air conditioning or janitorial services, nor for the stoppage, leaking or bursting of
any gas, water, steam, sewer or other pipe, or water closet, tank, or other fixture, nor for any
annoyance, inconvenience or damage caused by any electric or other wire, whether upon the
demised Land or in other parts of the Development, nor for any damage caused by water
coming or being upon the Development through the roof, or otherwise, nor for any damage
arising from any act or neglect of the RHDC or any other tenant or occupant of the
Development.
14. Entry by City
RHDC shall permit City and its agents to enter into and upon said
Development during the said term, for any cause.
15. Assignments
With the exception of the rental of the Units in accordance with the Assistance
and Operating Agreement RHDC shall not assign this Lease, or any interest therein, and shall
not sublet the said Development or any part thereof, or any right or privilege appurtenant
thereto, or suffer any other person (the agents and servants of RHDC excepted) to occupy or
use the said Development, or any portion thereof, without the prior written consent of City.
Any such assignment or subletting without such consent shall be void, and shall, at the option
of City, terminate this Lease. This Lease shall not, nor shall any interest therein, be assignable,
as to the interest of RHDC, without the written consent of City. Notwithstanding the
foregoing, for purposes of obtaining tax credits, RHDC shall be entitled to assign its rights and
obligations under this lease to a limited partnership, which RHDC or an entity controlled by
RHDC is the general partner. The covenants and conditions herein contained shall, subject to
the provisions as to assignment, apply to and bind the heirs, successors, executors,
administrators, and assigns of all the parties hereto.
16. Remedies for Breach
in the event of any breach of this lease by RHDC, then City, in addition to the
option to terminate this lease and other rights and remedies it may have, shall have the
immediate right of re -entry and may assume operation of the Development, and may remove all
persons and personal property from the Development. Should City elect to re- enter, as herein
provided, or should City take possession pursuant to legal proceedings or pursuant to any
notice provided for by law, City may either terminate this lease or it may from time to time,
without terminating this lease, re -let said Development or any part thereof for such term or
Ground Lease
Page 4 of 8
terms (which may be for a term extending beyond the term of this Lease) and at such rental or
rentals and upon such other terms and conditions as City in its sole discretion may deem
advisable with the right to make alterations and repairs to said Development.
17. Condemnation
If any part of the Development shall be taken or condemned for a public or
quasi - public use, and a part thereof remains which is suitable of occupation hereunder by
RHDC, this Lease shall, as to the part so taken, terminate as of the date title shall vest in the
condemnor, and the rent payable hereunder shall be adjusted so that the RHDC shall pay to
City each month for the remainder of the term on that portion of the rent as the fractional area
remaining after the condemnation bears to the total area of the Development prior to the date of
condemnation; but in such event City shall have the option to terminate this Lease as of the date
when title to the part so condemned vests in the condemnor. If all the Development, or such
part thereof be taken or condemned so that there no longer remains a portion suitable for
occupation hereunder, this Lease shall thereupon terminate.
18. Time
Time is of the essence of this Lease.
IN WITNESS 'WHEREOF, City and Rosemead Housing Development Corporation
have executed this Lease as of the latest date set forth opposite their respective signatures.
Dated: 1 2002
CITY
la
Mayor
ATTEST:
In
City Clerk
ROSEMEAD HOUSING DEVELOPMENT CORPORATION
LW3
Chairman
Ground Lease
Page 5 of 8
APPROVED AS TO FORM:_
m
City Attorney
Ground Lease
Page 6 of 8
Exhibit No. 1
Legal Description
[Legal Description on file with City Clerk]
Ground Lease
Page 7 of 8
Exhibit No. 2
Site Map
[Site Map on file with City Planning Department]
Ground Lease
Page 8 of 8