2500 - Affordable Housing Agreement for 8601-8623 Mission DriveAFFORDABLE HOUSING AGREEMENT
THIS AFFORDABLE HOUSING AGREEMENT (the "Agreement') is made as of
2023, by and between the CITY OF ROSEMEAD, a California municipal
corporation ("City"), and Mission Villas, LLC , a Delaware limited liability company
Homebuilder"), with reference to the following:
RECITALS
A. Homebuilder is the owner of that certain real property in the City located at 8601
— 8623 Mission Drive , as more particularly described in Exhibit A, attached hereto and
incorporated by this reference (the "Property").
B. The Property is being developed as a for -sale housing development known as
Vesting Tract Map No. 83705 (the "Project') with approximately 37 single family detached and
duplex homes, including approximately eight small lot single family homes and 29 single family
homes on a single lot.
C. The City has adopted a Homeownership Assistance Program (the "Program")
with funds from the Federal HOME Investments Partnership Program to encourage
homeownership for families who may not otherwise qualify to purchase a home. The Program
provides zero interest, forgivable, deferred subordinate deed loans to homebuyers. The Program
loans are for homes with values of up to ninety-five percent (95%) of the area median purchase
price for single family housing, as set forth in the rules for the Program (currently $807,500 for
single family homes), with such maximum amount subject to annual revision.
D. The Program is intended to work in conjunction with other private, state and
federal affordable housing programs, including loans, grants and lender credits as sourced by the
primary lender, and subject to the Program terms.
E. City desires to provide loans from the Program to four Low Income Family
purchasers of homes within the Project, in order to assist those households to purchase homes at
an affordable price.
F. The Homebuilder desires to facilitate the Program by making available a total of
four small lot three-bedroom homes on lots 2, 3, 6 and 7 as more particularly described in
Exhibit B, attached hereto and incorporated by this reference (the "Designated Homes") to be
sold to Low Income Family buyers who are participants in the Program as "Affordable Units".
The remaining homes will be sold on the open market at market prices.
NOW THEREFORE, the parties hereby agree as follows:
AGREEMENT
1. Definitions. For purposes of this Agreement, the terms listed below shall have the
meanings thereafter specified:
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"Affordable Purchase Price" shall mean the maximum purchase price for a home,
which does not exceed ninety-five percent (95°%) of the area median purchase price for single
family housing, in accordance with the rules for the Program. The Affordable Purchase Price is
currently $807,500 for single family homes, pursuant to the standards of the HOME Program,
and is subject to annual adjustment pursuant to the foregoing standards The date of execution of
the purchase and sales agreement shall be the date used to determine the applicable maximum
purchase price.
"Affordable Units" shall mean those Designated Homes which are sold to Low Income
Families at an Affordable Purchase Price in accordance with Section 4 hereof.
"Area Median Income" or "AMI" shall mean the median income for Los Angeles
County, as defined in 24 CFR Part 5, adjusted for family size, as annually established by
regulation of HUD.
"City Loans" means the loans to be made by City to the purchasers of up to four
Designated Homes within the Project pursuant to Section 2 hereof.
"Designated Homes" shall mean the four small lot homes on lots 2, 3, 6 and 7.
"Eligible Household" shall mean a household or individual, as applicable, meeting the
maximum gross income levels set forth in this Agreement as adjusted for household size, and all
of the other eligibility requirements of the Program, as set forth in the Program Policies and
Procedure Manual which has been adopted by the City.
"Homebuilder" means the person or entity defined as such in the introductory paragraph
of this Agreement, and includes all successors and assigns of that person or entity.
"HUD" means the U.S. Department of Housing and Urban Development.
"Individual Purchase Agreement" means the individual purchase agreement entered
into by Homebuilder and the purchaser of a Designated Home.
"Low Income Families" means households whose gross income does not exceed eighty
(80%) percent of the AMI for Los Angeles County, adjusted by household size, as determined
annually by HUD, in accordance with the regulations of the HOME Program.
"Project" shall have the meaning set forth in Recital B.
"Program" shall have the meaning set forth in Recital C.
"Property" shall have the meaning set forth in Recital A.
2. Homeowner Loans. City agrees to make available loans to qualified purchasers
of four Designated Homes within the Project ("City Loans"), up to the maximum per-unit subsidy
amount of the Program (currently $288,094 per home, subject to annual revision). City shall make
available the City Loans to homebuyers who are Low Income Families and Eligible Households,
until the later to occur of (a) the closing of escrow of the fourth Affordable Unit within the Project,
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or (b) forty-eight (48) months following the date of non -appealable approval from the City of the
Vesting Tract Map, Zone Change and General Plan Amendment for the Project. The principal
amount of each City Loan shall be in the amount which the City determines, in its reasonable
discretion, is necessary to enable the purchaser to purchase the Designated Home at an Affordable
Purchase Price.
3. Marketing of Designated Homes. To the extent permitted by state and federal
fair housing laws, specifically without limitation California Government Code Section 12955,
Homebuilder, for a period of for sixty (60) days following Homebuilder's receipt of a Preliminary
Public Report (Pink Report) from the California Department of Real Estate, shall use good faith
efforts to market and qualify Eligible Low -Income Households, that are veterans or persons of
military status, for the four Designated Homes. After this initial Sixty (60) day period, then
Homebuilder, for the next sixty (60) day period, at its reasonable discretion in consultation with
City, and to the extent permitted by state and federal fair housing laws, shall, using good faith
efforts, expand the marketing and qualifying of eligible households for the four Designated Homes
to include Eligible Low -Income Households that reside in City of Rosemead. If Homebuilder has
not obtained sufficient Eligible Low -Income Households during the one hundred twenty (120) day
period described above, then Homebuilder may broaden the marketing of the Designated Homes
to persons beyond the foregoing groups. Upon receipt of a Conditional Public Report (Yellow
Report), Homebuilder shall use good faith efforts to enter into Individual Purchase Agreements
with the selected Eligible Households on a first come first served basis.
4. Initial Sale of Affordable Units
(a) Homebuilder agrees to cooperate with the City and to follow City guidelines
and reasonably consider City recommendations in identifying Eligible Households for the
purchase of the four Designated Homes at not more than an Affordable Purchase Price
("Affordable Units").
(b) Homebuilder has no obligation to sell an Affordable Unit for less than the
maximum Affordable Purchase Price except in the case where the appraisal is for less than the
Affordable Purchase Price, and can decide to sell an Affordable Unit for less than the maximum
Affordable Purchase Price at Homebuilder's sole discretion.
(c) Homebuilder shall provide to the City a certification of the income and
support documentation of the proposed initial purchaser of each Affordable Unit. Homebuilder
shall obtain income documentation from the proposed purchaser of the Affordable Units in
accordance with 24 CFR Part 5 (Part 5 annual income). The City will review income
documentation obtained by Homebuilder to confirm compliance with 24 CFR Part 5. Income
documentation includes but is not limited to all of the following:
(i) Obtain from the proposed purchaser paycheck stubs from the
three (3) most recent months;
(ii) Obtain a true copy of an income tax return from the proposed
purchaser for the three most recent tax years;
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(iii) Obtain an income verification certification from the employer of the
proposed purchaser;
(iv) Obtain an income verification certification from the Social Security
Administration and/or the California Department of Social Services if the proposed purchaser
receives assistance from such agencies; or
(v) Obtain an alternate form of income verification acceptable to the
City, in City's reasonable discretion.
(vi) Obtain copies of most recent 6 months checking and most recent
savings, and other asset accounts.
(vii) Obtain additional documentation to meet the requirements of 24
CFR Part 5 (Part 5 annual income).
(d) Homebuilder shall obtain and provide to the City a certification from the
purchaser that the purchaser shall occupy the Affordable Unit as the purchaser's primary residence,
and which contains all of the other certifications required in accordance with the rules of the
Program.
(e) Homebuilder shall apply the same purchase terms and conditions to
potential buyers of Affordable Units as are applied to all other buyers of Project homes, except as
otherwise required to comply with this Agreement (i.e. income and other eligibility requirements).
(f) Upon receipt of the foregoing information, City shall determine, in its
reasonable discretion, whether each proposed purchaser of an Affordable Unit is eligible for a City
Loan, shall determine the maximum amount of the City Loan for which the proposed purchaser is
eligible, and shall process the application in accordance with the adopted policies and procedures
of the Program.
(g) Each approved purchaser of an Affordable Unit shall execute such
documents for the City Loan as are provided by the City, in accordance with the requirements of
the Program.
5. Property Taxes. Homebuilder and City agree to cooperate with one another
and work together with the Los Angeles County Office of the Assessor to qualify the Affordable
Units for a revised tax basis, allowing for the property tax basis to be calculated pursuant to the
county affordable program. City shall have no liability for any property tax related to the Project
homes and City shall have no liability due to the failure or inability of the Assessor's office to
provide a revised tax basis.
6. Compliance with Laws. Homebuilder shall comply with all applicable laws
relating to this Agreement and the transactions contemplated by this Agreement including, but not
limited to, laws relating to fair housing laws, including the Federal Fair Housing Act, the California
Fair Employment and Housing Act, and the Unruh Civil Rights Act.
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7. Notices. Formal notices, demands, and communications between City and
Homebuilder shall be given either by personal service, by overnight courier, or by mailing in the
United States mail, certified mail, postage prepaid, return receipt requested, addressed to the
principal offices of City and Homebuilder, as follows:
If to Homebuilder(s):
Mission Villas, LLC, care of
Borstein Enterprises
11766 Wilshire Boulevard, Suite 820
Los Angeles, CA 90025
Attn: Erik Pfahler. Senior Vice President
If to City:
City of Rosemead
8838 E. Valley Boulevard
Rosemead, CA 91770
Attention:
Notices shall be considered effective upon receipt, if given by personal delivery; the earlier
of (i) three (3) business days after deposit with United States Mail postage prepaid and properly
addressed, or (ii) the date of actual receipt as evidenced by the return receipt, if delivered by
certified mail; and one (1) day after deposit with the delivery service, if delivered by overnight
guaranteed delivery service postage prepaid and properly addressed. Each party shall promptly
notify the other party of any change(s) of address to which notice shall be sent pursuant to this
Agreement.
8. Homebuilder's Obligation to Refrain From Discrimination. There shall be no
discrimination against or segregation of any person, or group of persons, on account of race, color,
religion, sex, gender, gender identity, gender expression, sexual orientation, marital status, national
origin, ancestry, familial status, source of income, disability, veteran or military status, or genetic
information of any person in the sale, transfer, use, occupancy, tenure or enjoyment of the Project
homes, nor shall Homebuilder itself or any person claiming under or through it establish or permit
any such practice or practices of discrimination or segregation with reference to the selection,
location, use or occupancy of Eligible Household purchasers of the Affordable Units.
9. Conflict of Interest; No Individual Liability. No official or employee of the City
shall have any personal interest, direct or indirect, in this Agreement, nor shall any official or
employee of the City participate in any decision relating to this Agreement which affects such
official's or employee's pecuniary interest in any corporation, partnership or association in which
such official or employee is directly or indirectly interested. No official or employee of the City
shall be personally liable in the event of a breach of this Agreement by the City.
10. No Employee Eligibility. No City employee or City official or their Relative(s)
shall be eligible to participate in purchasing a Designated Home. "Relative" for these purposes
means a spouse, parent or child.
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11. Modification. This Agreement may be modified only by subsequent mutual
written agreement executed by City and Homebuilder or their successors.
12. Governing Law. The laws of the State of California shall govern this Agreement.
Any legal action brought under this Agreement must be instituted in the Superior Court of the
County of Los Angeles, State of California.
13. Assignment of Agreement. This Agreement shall be assignable by Homebuilder
in connection with the sale or transfer of the Project and assumption by the transferee of all
obligations arising from this Agreement. Assignee shall assume the entirety of this Agreement,
including all obligations and Homebuilder shall ensure any assignment shall include all such
requirements of this Agreement. Any assignment of this Agreement shall be preceded by 30 day
notice to City.
14. Severability. Every provision of this Agreement is intended to be severable. If
any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent
jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not be
affected or impaired.
15. Entire Agreement. This Agreement constitutes the entire agreement between the
parties, and integrates all of the terms and conditions mentioned herein or incidental hereto and
supersedes all negotiations or previous agreements between the parties regarding all or any part of
the subject matter thereof.
16. Counterparts. This Agreement may be signed in multiple counterparts, which,
when signed by all parties, shall constitute a binding agreement.
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IN WITNESS WHEREOF, the City and Homebuilder have caused this instrument to be
executed on their behalf by their respective officers hereunto duly authorized as of date first
written above.
City:
CITY OF ROSEMEAD,
a California municipal corporation
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By:
irST:
By.
:-City Clerk
APPROVED AS TO FORM:
HOMEBUILDER:
MISSION VILLAS, LLC,
a Delaware limited liability company
By: BORSTEIN ENTERPRISES,
a California corporation
its Solo-Meniper
B
Name:
Title:
By:
Name:
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5200621.4
EXHIBIT A
LEGAL DESCRIPTION
Parcel I
That portion of Lot 12 in Block 2 of Rosemead, in the City of Rosemead. County of Los Angeles. State of
California. as per map recorded in Book 12 Page 194 of Maps, in the office of the County Recorder of said County.
described as follows:
Beginning at a Ixtint in the southwesterly line of said lar, distant thereon North W' 21' 00" Wcsl 229,87 fcct from
the southeast corner of said lot: thence North 28" 53' 1 �,' Fast 162.14 feet: thence North 890 02' 15" East. 124.80
feel to a point in Ilse easterly litre of said lot: [Renee along said caslcrl% litre North 00' 57' 45' West 457.92 feet.
more or less, to doe most southerly comer of the land described in Deed to Iheodore Swan, recorded in Book 14446
Page 314. Official Records of said County: thence along the southwesterly line of the land described in said Deed.
North 64' 21' 00' Wast 194 56 feet to a point in the caslcdy line of the 5oulhcm California Edison Company's right
of way. shown as Parcel No. 19 on Licensed Sun eyor's Map filed in Book 30 Pace 4. Record of Surveys, in the
office of the County Recorder of said County: thence along said casterh litre- South 00' 22'0 1" Fast 254.20 feel to
an angle point in said easterly line of said Parcel No. 19: thence continuing along said easterly line and the
prolongation thereof South 28" 53' 15' West. 399.39 feet to a point in the southwesterly line of said Lot 12: thence
along said suuthw estcrh' littc South 64' _' 1' 00" Fast 190.00 feet to the point of beginning.
APNs: 5389-009-0.10 and a portion of 5389-009-031
Parcel 2:
That portion of Lot 12 in Block 2 of Rosemead, in the City of Rosemead, County of Lots Angeles. State of
California, as per map recorded in Book 12 Page 194 of Maps. in the office of the County Recorder of said County.
described as follows:
Beginning at a point in the easterly line of said Lot 12. distant thereon South 0` 35' 49" East 254.68 feet from the
northeast comer of said Lot 12: thence North 64" 04' 21" West. parallel w ids Ilse northerly line of said IoL a distance
of 194.56 feet. more or less, to the intersection with the easterly line of the right of way of the Southern California
Edison Company :is shown on map of Records of Survey filed in Book 30 Page, I to 7, inclusive of Record, of
Same y's, records of said Couwa. thence North 890 55' 39" East 173.95 feet to a point in the easterly line of said lot
distant thereon North 0' 35' 49- East 85.23 is ct front the point of beginning: thence S0Udl W 35 49" West 85.23
feet to the point of beginning.
APN: 5389-109-031 (REMAINDER OM
Parcel 3
That portion of Parcel 2. in the City of Rosemead. County of Los Angeles. State of California. as shown on the
Record of Survey Map filed in Book 52 Page 27 of Record of Surveys. in the office of the County Recorder of said
County, described as follows:
Beginning at a point in the southwest line of said parcel which is disumt North 64' 21' 04)" West 169.87 feet from
the southeast corner of said panel. thence continuing along said soulhtval line North 64' 21' 00" Wal 60.00 feet to
the southwesterly corner of said Parcel 2: thence along the westerly line of said parcel North 28' 53' 15" East
162.14 feet to the northwesterly corner of said Parcel 2: thence along the northerly line of said parcel North 89° 02'
15- East 38.00 feet to a point in We said northcrly line which is South ItV 02- 15' N'at 86.80 feet from the
northeast comer of said parcel: thence southwesterly in a direct line to the point of beginning.
APN: 5389-4X)9.029
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EXHIBIT B
SITE MAP
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