The manner in which the Agency shall exercise its powers and perform its duties is and shall be subject to the restrictions upon the manner in which a California city could exercise such powers and perform such duties. The manner in which the Agency shall exercise its powers and perform its duties shall not be subject to any restrictions applicable to the manner in which any other public agency could exercise such powers or perform such duties, whether such agency is a party to this Agreement or not.
Section 5. Fiscal Year.
For the purposes of this Agreement, the term “ Fiscal Year” shall mean the fiscal year as established from time to time by resolution of the Board, being, at the date of this Agreement, the period from July 1 to and including the following June 30, except for the first Fiscal Year which shall be the period from the date of this Agreement to June 30, 20__.
Section 6. Disposition of Assets.
At the end of the term hereof or upon the earlier termination of this Agreement as set forth in Section 2, after payment of all expenses and liabilities of the Agency, all property of the Agency both real and personal shall automatically vest in the Members in the manner and 519
7 amount determined by the Board in its sole discretion and shall thereafter remain the sole property of the Members; provided, however, that any surplus money on hand shall be returned in proportion to the contributions made by the Members.
Section 7. Bonds.
From time to time the Agency shall issue Bonds, in one or more series, for the purpose of exercising its powers and raising the funds necessary to carry o ut its purposes under this Agreement.
The services of bond counsel, financing consultants and other consultants and advisors working on the projects and/or their financing or refinancing or on post -issuance compliance or administration may be used by th e Agency. The expenses of the Board shall be paid from the proceeds of the Bonds, payments made by Bond obligors or other third parties, project revenues, or any other unencumbered funds of the Agency available for such purpose.
Section 8. Bonds Only Limited and Special Obligations of Agency.
The Bonds, together with the interest and premium, if any, thereon, shall not be deemed to constitute a debt of any Member or pledge of the faith and credit of the Members or the Agency. The Bonds shall be only special obligations of the Agency, and the Agency shall under no circumstances be obligated to pay the Bonds except from revenues and other funds pledged therefor. Neither the Members nor the Agency shall be obligated to pay the principal of, premium, if any, or interest on the Bonds, or other costs incidental thereto or related to any project or program financed or refinanced with Bonds, except the Agency from the assets, revenues and funds pledged and available therefor, and ne ither the faith and credit nor the taxing power of the Members nor the faith and credit of the Agency shall be pledged to the payment of the principal of, premium, if any, or interest on the Bonds, or any costs related thereto or to any project or program financed or refinanced thereby, nor shall the Members or the Agency in any manner be obligated to make any appropriation for such payment.
No covenant or agreement contained in any Bond or related document shall be deemed to be a covenant or agreement of any Director, or any officer, employee or agent of the Agency in his or her individual capacity, and neither the Board of the Agency nor any Director or officer thereof executing the Bonds shall be liable personally on any Bond or be subject to any personal liability or accountability by reason of the issuance of any Bonds or by reason of any project or program financed or refinanced with Bonds.
Section 9. Accounts and Reports.
All funds of the Agency shall be strictly accounted for. The Agency shall establish and maintain such funds and accounts as may be required by good accounting practice and by any provision of any Indenture (to the extent such duties are not assigned to a trustee of Bonds). The books and records of the Agency shall be open to inspection at all reasonable times by each Member.
The Treasurer of the Agency shall cause an independent audit to be made of the books of accounts and financial records of the Agency by a certified public accountant or public accountant in complian ce with the provisions of Section 6505 of the Joint Exercise of Powers Act. In each case the minimum requirements of the audit shall be those prescribed by the State Controller for special districts under Section 26909 of the Government Code of the State of California and shall conform to generally accepted auditing standards. When such an audit of 520
8 accounts and records is made by a certified public accountant or public accountant, a report thereof shall be filed as a public record with each Member and als o with the county auditor of each county in which a Member is located; provided, however, that to the extent permitted by law, the Agency may, instead of filing such report with each Member and such county auditor, elect to post such report as a public rec ord electronically on a website designated by the Agency. Such report if made shall be filed within 12 months of the end of the Fiscal Year or Years under examination.
The Treasurer is hereby directed to report in writing on the first day of July, Oct ober, January, and April of each year to the Board and the Charter Members which report shall describe the amount of money held by the Treasurer for the Agency, the amount of receipts since the last such report, and the amount paid out since the last such report (which may exclude amounts held by a trustee or other fiduciary in connection with any Bonds to the extent that such trustee or other fiduciary provided regular reports covering such amounts.)
Any costs of the audit, including contracts with, or e mployment of, certified public accountants or public accountants in making an audit pursuant to this Section, shall be borne by the Agency and shall be a charge against any unencumbered funds of the Agency available for that purpose.
In any Fiscal Year the Board may, by resolution adopted by unanimous vote, replace the annual special audit with an audit covering a two-year period.
Section 10. Funds.
Subject to the applicable provisions of any Indenture, which may provide for a trustee or other fiduciary to receive, have custody of and disburse Agency funds, the Treasurer of the Agency shall receive, have the custody of and disburse Agency funds pursuant to the accounting procedures developed under Sections 3C and 9, and shall make the disbursements required by this Agreement or otherwise necessary to carry out any of the provisions of purposes of this Agreement.
Section 11. Notices.
Notices and other communications hereunder to the Members shall be sufficient if delivered to the clerk of the governing body of each Member; provided that, to the extent permitted by law, the Agency may provide notices and other communications and postings electronically (including, without limitation, through email or by posting to a website).
Section 12. Additional Members/Withdrawal of Members.
Qualifying public agencies may be added as parties to this Agreement and become Charter Members upon: (1) the fil ing by such public agency with the Agency of an executed counterpart of this Agreement, together with a copy of the resolution of the governing body of such public agency approving this Agreement and the execution and delivery hereof; and (2) adoption of a resolution of the Board approving the addition of such public agency as a Charter Member. Upon satisfaction of such conditions, the Board shall file such executed counterpart of this Agreement as an amendment hereto, effective upon such filing.
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9 Qualifying public agencies may also be added as non-Charter Members (“ Additional Members”) of the Agency upon: (1) the filing by such public agency with the Agency of a resolution of the governing body of such public agency requesting to be added as an Additional Member of the Agency, and (2) adoption of a resolution of the Board approving the addition of such public agency as an Additional Member. An Additional Member may limit in the aforementioned resolution the scope of its Additional Membership to what is nec essary or appropriate to facilitate the financing or refinancing of one or more specified projects or programs.
A Member may withdraw from this Agreement upon written notice to the Board; provided, however, that (i) at least one Member shall be a Charter Member, (ii) no such withdrawal shall result in the dissolution of the Agency so long as any Bonds remain outstanding and (iii) no such withdrawal shall cause the loss of the property tax exemption of any project owned by the Agency. Any such withdrawal shall be effective only upon receipt of the notice of withdrawal by the Board, which shall acknowledge receipt of such notice of withdrawal in writing and shall file such notice as an amendment to this Agreement effective upon such filing.
Section 13. Indemnification.
To the full extent permitted by law, the Board may authorize indemnification by the Agency of any person who is or was a Director or an officer, employee or other agent of the Agency, and who was or is a party or is threatened to be made a pa rty to a proceeding by reason of the fact that such person is or was such a Director or an officer, employee or other agent of the Agency, against expenses, including attorneys’ fees, judgments, fines, settlements and other amounts actually and reasonably incurred in connection with such proceeding, if such person acted in good faith in a manner such person reasonably believed to be in the best interests of the Agency and, in the case of a criminal proceeding, had no reasonable cause to believe the conduct of such person was unlawful and, in the case of an action by or in the right of the Agency, acted with such care, including reasonable inquiry, as an ordinarily prudent person in a like position would use under similar circumstances. The Board may purchas e a policy or policies of insurance in furtherance of any indemnification obligation created or otherwise in protection of Directors, officers, employees or other agents.
Section 14. Contributions and Advances.
Contributions or advances of public funds and of the use of personnel, equipment or property may be made to the Agency by the Members for any of the purposes of this Agreement. Payment of public funds may be made to defray the cost of any such contribution or advance. Any such advance may be made subject to repayment, and in such case shall be repaid, in the manner agreed upon by the Agency and the Member making such advance at the time of such advance. It is mutually understood and agreed to that no Member has any obligation to make advances or contributions to the Agency to provide for the costs and expenses of administration of the Agency, even though any Member may do so. The Members understand and agree that a portion of the funds of the Agency that otherwise may be allocated or distributed to the Members and the funds of the Agency constituting fee or other revenues with respect to Bonds or Projects may instead be used to make grants, loans or provide other financial assistance to governmental units and to nonprofit organizations to accomplish any of the governmental unit’s or nonprofit organization's purposes.
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10 Section 15. Immunities.
All of the privileges and immunities from liabilities, exemptions from laws, ordinances and rules, and other benefits which apply to the activity of o fficers, agents or employees of Members when performing their respective functions within the territorial limits of their respective public agencies, shall apply to the same degree and extent to the Directors, officers, employees, agents or other representatives of the Agency while engaged in the performance of any of their functions or duties under the provisions of this Agreement.
None of the officers, agents or employees, if any, directly employed or engaged by the Agency shall be deemed, by reason of t heir employment or engagement by the Agency, to be employed or engaged by any Member or, by reason of their employment or engagement by the Agency, to be subject to any of the requirements of any Member.
Section 16. Amendments.
Except as provided in Sections 3B and 12 above, this Agreement shall not be amended, modified, or altered, unless the written consent of each of the Charter Members is obtained; provided that no amendment shall materially adversely affect the interests of any Additional Member unless the negative consent of that Additional Member is also obtained. To obtain the negative consent of each such Additional Member, the following negative consent procedure shall be followed: (a) the Agency shall provide each suc h Additional Member with a notice at least sixty (60) days prior to the date such proposed amendment is to become effective explaining the nature of such proposed amendment and this negative consent procedure; (b) the Agency shall provide each such Additio nal Member who did not respond a reminder notice with a notice at least thirty (30) days prior to the date such proposed amendment is to become effective; and (c) if no such Additional Member objects to the proposed amendment in writing within sixty (60) d ays after the initial notice, the proposed amendment shall become effective with respect to all Members.
Section 17. Effectiveness.
This Agreement shall become effective and be in full force and effect and a legal, valid and binding obligation of each of the Members on the date that the Board shall have received from two of the Charter Members an executed counterpart of this Agreement, together with a certified copy of a resolution of the governing body of each such Charter Member approving this Agreement and the execution and delivery hereof.
Section 18. Partial Invalidity.
If any one or more of the terms, provisions, promises, covenants or conditions of this Agreement shall to any extent be adjudged invalid, unenforceable, void or voidable for any reason whatsoever by a court of competent jurisdiction, each and all of the remaining terms, provisions, promises, covenants and conditions of this Agreement shall not be affected thereby, and shall be valid and enforceable to the fullest extent permitted by law.
Section 19. Successors.
This Agreement shall be binding upon and shall inure to the benefit of the successors of the parties hereto. Except to the extent expressly provided herein, no Member may assign any right or obligation hereunder without the consent of the other Members. 523
11 Section 20. Miscellaneous.
This Agreement may be executed in several counterparts, each of which shall be an original and all of which shall constitute but one and the same instrument.
The section headings herein are for conveni ence only and are not to be construed as modifying or governing the language in the section referred to.
Wherever in this Agreement any consent or approval is required, the same shall not be unreasonably withheld.
This Agreement shall be governed under the laws of the State of California.
This Agreement, including its recitals which are incorporated herein, is the complete and exclusive statement of the agreement among the Members, which supersedes and merges all prior proposals, understandings, and othe r agreements, whether oral, written, or implied in conduct, between and among the Members relating to the subject matter of this Agreement.
[SIGNATURES ON THE PAGE TO FOLLOW]
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[Signature Page - Joint Exercise of Powers Agreement Relating to the CMFA Special Finance Agency XV] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and attested by their duly authorized representatives as of the day and year first above written.
Charter Member:
California Municipal Finance Authority
By
Name:
Title:
Charter Member:
City of Oxnard
By
Name:
Title:
ATTEST:
City Clerk
APPROVED AS TO FORM:
City Attorney
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[JH Draft 1-25-22]
RECORDING REQUESTED
AND WHEN RECORDED MAIL TO:
475 Sansome Street, Suite 1700
San Francisco, California 94111
Attention: Josh D. Anzel
THIS SPACE IS FOR RECORDERS USE ONLY
PUBLIC BENEFIT AGREEMENT
(Title of Document)
Per Government Code 27388.1 (a)(1) “A fee of $75 dollars shall be paid at the time of recording of every real estate instrument, paper, or notice required or permitted by law to be recorded, except those expressly exempted from payment of recording fees, per each single transaction per parcel or real property. The fee shall not exceed two hundred twenty-five dollars ($225)” Reason for Exemption:
☐ Exempt from fee per GC 27388.1 (a) (2); recorded concurrently “in connection with” a transfer subject to the imposition of documentary transfer tax (DTT). ☐ Exempt from fee per GC 27388.1 (a) (2); recorded concurrently “in connection with” a transfer of real property that is a residential dwelling to an owner-occupier. ☒ Exempt from fee per GC 27388.1 (a) (2) (D); recording fee exempt under GC 27383. ☐ Exempt from fee per GC 27388.1 (a) (1); fee cap of $225.00 reached. ☐ Exempt from the fee per GC 27388.1 (a) (1); not related to real property.
Failure to include an exemption reason will result in the imposition of the $75.00 Building Homes and Job Act Fee.
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RECORDING REQUESTED BY
CMFA Special Finance Agency XV
WHEN RECORDED RETURN TO:
Jones Hall, A Professional Law Corporation
475 Sansome Street, Suite 1700
San Francisco, California 94111
Attention: Josh D. Anzel
THIS DOCUMENT IS EXEMPT FROM RECORDING FEES PURSUANT TO SECTION 27383
OF THE CALIFORNIA GOVERNMENT CODE
PUBLIC BENEFIT AGREEMENT
By and Between
CMFA SPECIAL FINANCE AGENCY XV
and
CITY OF OXNARD
_________________________
Dated as of ________________ 1, 20__
_________________________
Relating to
CMFA SPECIAL FINANCE AGENCY XV
SENIOR ESSENTIAL HOUSING REVENUE BONDS, SERIES 20__A-1
(THE VINES AT RIVERPARK)
CMFA SPECIAL FINANCE AGENCY XV
JUNIOR ESSENTIAL HOUSING REVENUE BONDS, SERIES 20__A-2
(THE VINES AT RIVERPARK)
and
CMFA SPECIAL FINANCE AGENCY XV
SUBORDINATE ESSENTIAL HOUSING REVENUE BONDS, SERIES 20__B (THE VINES AT RIVERPARK)
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1 PUBLIC BENEFIT AGREEMENT
This PUBLIC BENEFIT AGREEMENT (“ Agreement ”) is dated as of ________________ 1, 20__, by and between the CMFA SPECIAL FINANCE AGENCY XV , a joint exercise of powers agency organized and existing under the laws of the State of California (including its successors and assigns, “ Owner”), and the CITY OF OXNARD, a California municipal corporation and general law city (“Host”).
BACKGROUND
WHEREAS, the Owner proposes to issue Bonds (as hereinafter defined) to finance Owner’s acquisition of the certain multifamily rental housing projects (collectively, the “Project”) located at 3040 N Oxnard Boulevard in the City of Oxnard, California, locate d on the real property site described in Exhibit A hereto; and
WHEREAS, the Owner has executed a Regulatory Agreement and Declaration of Restrictive Covenants between Owner and Wilmington Trust, National Association , dated concurrently and recorded in the official records of the County of Ventura, California (the “County”), which imposes requirements upon the Project with respect to maximum income levels of tenants, maximum rents payable by tenants, maintenance of the Project in accordance with industry standards, and certain other matters, and Host is entering into this Agreement in reliance on Owner’s compliance with such requirements; and WHEREAS, the Owner intends to sell the Project at the instigation of the Host or upon the retirement of all Project Debt (as defined herein) pursuant to this Agreement.
AGREEMENT
In consideration of the mutual covenants herein contained, and such other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, Owner and Host mutually agree as follows:
Section 1. Right to Cause Sale . Host shall have the right to cause (“ Sale Right”) the Owner to sell the Property (as herein defined) to Host or Host’s designee upon payment by the Purchaser (as herein defined) of the Sale Price (as herein provided) w ithin the Sale Right Term (as herein defined) and in compliance with and observance of all of the terms and conditions of this Agreement.
Section 2. Definitions. Capitalized terms used in this Agreement shall have the meanings assigned to them in this Section 2; cap italized terms used in this Agreement and not defined in this Section 2 or elsewhere herein shall have the meanings assigned to them in the Indenture (herein defined).
(a) “Bonds” – collectively, (i) the CMFA Special Finance Agency XV Senior Essential Housing Revenue Bonds, Series 20__A-1 (The Vines at Riverpark ), (ii) the CMFA Special Finance Agency XV Junior Essential Housing Revenue Bonds, Series 20__A-2 (The Vines at Riverpark ), and ( iii) the CMFA Special Finance Agency XV Subordinate Essential Housing Revenue Bonds, Series 20__B (The Vines at Riverpark ) (the “ Series B Bonds ”), with such other series and sub -series designations as may be set forth in the Indenture, originally issued to finance Owner’s acquisition of the Project and related transaction costs. The original principal amount of the Series B Bonds shall not exceed $5,000,000. 528
2 (b) “Bond Trustee ” – Wilmington Trust, National Association , or any successor trustee under the Indenture.
(c) “Closing” – shall have the meaning set forth in Section 8 hereof. (d) “Conveyance” – that transaction or series of transactions by which Owner shall transfer, bargain, sell and convey any and all right, title or interest in and to the Property. (e) “Exercise Notice” – shall have the meaning set forth in Section 4(a) hereof. (f) “Extraordinary Costs and Expenses ” – shall have the meaning set forth in the Indenture.
(g) “Host Indemnified Person ” – the Host and each of its officers, governing members, directors, officials, employees, attorneys, agents and members. (h) “Indenture” – the Trust Indenture between Owner, as issuer, and the Bond Trustee, as trustee, pursuant to which the Bonds were issued. (i) “Minimum Sale Price” – means the lowest price at which the Property may be sold, as described in Section 4(c) hereof.
(j) “Outstanding” – with respect to Bonds, as of any given date, all Bonds which have been authenticated and delivered by the Trustee under the Indenture, except: (i) Bonds cancelled at or prior to such date or delivered to or acquired by the Trustee at or prior to such date for cancellation; (ii) Bonds deemed to be paid in accordance with Article IX of the Indenture; and (iii) Bonds in lieu of which other Bonds have been authenticated under the Indenture.
(k) “Owner Indemnified Person ” – the Owner and each of its officers, go verning members, directors, officials, employees, attorneys, agents and members. (l) “Project Administrator” – HomeFed Asset Management LLC (or an affiliate) and its successors and assigns.
(m) “Project Debt ” – any debt secured by the Project and incurred to fina nce or refinance Owner’s acquisition of the Project and related transaction costs, including any portion of the Bonds and any bonds, notes or other indebtedness issued by Owner to improve the Project or to refund the Bonds in whole or in part.
(n) “Property” – means all of Owner’s right, title and interest (which includes fee simple title to the real property) in and to all property and assets used in or otherwise related to the operation of the Project including, without limitation, all real property and inter ests in real property, all tangible and intangible personal property including furniture, fixtures, equipment, supplies, intellectual property, licenses, permits, approvals, and contractual rights of any kind or nature together with the right to own and carry on the business and operations of the Project. (o) “Purchaser” – means the purchaser of the Property in a sale thereof. (p) “Regulatory Agreement” – means the Regulatory Agreement and Declaration of Restrictive Covenants by and between the Owner and the Bond Trustee, relating to the Bonds. 529
3 (q) “Sale Price” – purchase price of the Property to be paid by the Purchaser upon sale of the Property by the Owner pursuant to the Sale Right in compliance with Section 4 hereof or sale by the Owner pursuant to Section 5 hereof. (r) “Sale Right ” – means the right of the Host to cause the Owner to sell the Property pursuant to Section 1 hereof.
(s) “Sale Right Exercise Date ” – the date fifteen (15) years from the issuance of the Bonds.
(t) “Sale Right Term ” – shall commence on the Sale Right Exercise Date and, if not exercised, shall terminate at 11:59 p.m. local time on the date that is the earlier of : (i) fourteen (14) years from the Sale Right Exercise Date or (ii) the date on which no Project Debt remains Outstanding.
(u) “Transaction Costs” – to the extent not otherwise described herein, any costs or expenses of any kind or nature associated with or incurred by Owner and Bond Trustee in connection with the consummation of the Conveyance, regardless of whether such costs and expenses are customarily borne by the seller or purchaser in any such transaction, including but not limited to taxes, recording fees and other impositions, Owner’s and Bond Trustee’s legal and other professional fees, fees for verification agents, bidding agents, escrow ag ents, custodians or trustees, assumption fees, prepayment fees, the cost of the appraisal, brokers’ fees and expenses, surveys, inspections, title commitments, title insurance premiums and other title - related fees, and all amounts required for indemnificat ion of Owner, Trustee and Project Administrator.
Section 3. Effectiveness; Term and Termination . The Sale Right shall become effective on the Sale Right Exercise Date and may be exercised during the Sale Right Term.
Owner agrees that it will not enter into any agreem ent to sell all or any part of the Property during the Sale Right Term other than as may be required by the Indenture (e.g., in the event of default), without the specific written request of the Host and delivery of an Opinion of Bond Counsel to the Owner substantially to the effect that such sale will not, in and of itself, adversely affect the exclusion of interest on the Bonds from gross income for purposes of federal income taxation.
Section 4. Exercise of Sale Right.
(a) Host’s Notice . To exercise the Sale Right, Host shall provide a notice (an “Exercise Notice”) to Owner (with a copy to the Project Administrator) at any time during the Sale Right Term.
(b) Owner’s Best Efforts to Sell . Unless Host notifies Owner in writing that it is withdrawing its Exercise Notice w ithin fifteen (15) business days of delivering the Exercise Notice under Section 4(a) hereof, Owner shall exercise its best efforts to enter into a purchase agreement for the sale of the Property in accordance with Section 7(d) and to sell and convey good and marketable title to the Property to Host or its designee within ninety (90) days following receipt of the Exercise Notice, or as soon as possible thereafter, in accordance with the purchase agreement, but only if it can sell at or above the Minimum Sal e Price. The obligation of the Owner to enter into the purchase agreement for the sale and conveyance of the Property to Host or its designee shall be on a best efforts basis. The Owner shall endeavor to sell the Property at a commercially reasonable price, subject to subsection (c) of this Section, by 530
4 such means as the parties to the purchase agreement shall determine to be suitable for such purpose; provided that Owner shall incur no liability to any party as a result of or otherwise in connection with the sale or failure to sell. Subject to subsection (c), nothing herein shall require or prevent Owner selling the Property subject to the restrictions set forth in the Regulatory Agreement. The Owner shall direct the Bond Trustee in the foregoing as and to the extent necessary or appropriate.
(c) Sale Price. The Sale Price shall be at least equal to the sum of the amounts set forth below (net of any adjustments or prorations of the type described in Section 8(b)) (the “Minimum Sale Price”):
i. an amount sufficient to either prepay, redeem in whole or fully defease for redemption on the earliest call date all Project Debt; plus ii. any fees or other amounts not identified in clause (i) that may be necessary to effect the complete release from and discharge of any lien, mortgage or other encumbrance on the Property; plus
iii. any amounts due to Owner (including the Owner Indemnified Persons, as provided in the Indenture), the Bond Trustee or any predecessor or successor, or any other Person under any indenture, loan agreement , bond, note or other instrument relating to any Project Debt (including, without limitation, indemnification amounts, Owner’s Extraordinary Costs and Expenses, recurrent and extraordinary fees and expenses, and reimbursable costs and expenses of any kind or nature); plus iv. Transaction Costs; minus
v. Any funds held by or for Owner under the Indenture applied to the retirement of Project Debt. Owner may retain such portion of moneys in the Extraordinary Expense Fund or similar fund under the Indenture it deems r easonable as a reserve against future expected costs and expenses of the type described in subparagraph (iii). Owner’s determination of this amount shall be final and incontestable.
Section 5. Mandatory Conveyance. Upon the retirement of all Project Debt, the Owner shall use its best efforts to effect a Conveyance within ninety (90) days thereafter, subject to Section 4(c) hereof. Owner shall give notice to Host of its intent to convey the Property, and Host (or its des ignee) shall have the first right to acquire the Property by delivery of an Exercise Notice to Owner within thirty (30) days after receipt of Owner’s notice. Nothing herein shall require or prevent Owner selling the Property subject to the restrictions se t forth in the Regulatory Agreement.
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5 Section 6. Surplus Cash; Surplus Conveyance Proceeds . Upon a Conveyance of the Property, Owner shall apply the proceeds of such Conveyance (i) to redeem the Bonds then Outstanding, (ii) to prepay, redeem in whole or fully defease any other Project Debt, and (iii) to pay any fees or other amounts listed in Section 4(c)(ii) – (iv). Any proceeds remaining following the foregoing payments (such remaining amounts hereinafter referred to as “ Surplus Conveyance Proceeds ”) shall be transf erred to Host, and Host shall equitably share (within Host’s reasonable discretion) such Surplus Conveyance Proceeds with the other taxing agencies in the County so as to reimburse such taxing agencies for any foregone property tax revenue.
Section 7. Terms of Conveyance.
(a) The Conveyance shall be in the nature of a grant deed to Purchaser in which Owner shall deliver one or more deeds, bills of sale, or other instruments of transfer without recourse or warranty of any kind or nature.
(b) The Property will be conveyed to Purchaser in AS IS CONDITION, WITH ALL FAULTS, and without representations or warranties of any kind or nature as to the condition of the Property, except as may otherwise be set forth in the purchase agreement. (c) There shall be no partial transfer and that , upon consummation of the Conveyance, Owner shall be fully divested of any and all right, title or interest in and to the Property.
(d) Upon Host’s delivery of the Exercise Notice, Owner shall deliver to Purchaser a purchase agreement for the Property, and the parties shall negotiate in good faith towards a mutually satisfactory purchase agreement form and substance satisfactory to Owner and Purchaser and their counsel subject to the terms and conditions of this Agreement. The purchase agreement shall permit Purchaser to conduct physical inspections of the Property and conduct due diligence related to the purchase of the Property, including without limitation its value and physical and environmental condition, and shall provide Purchaser a due diligence approval period of not less than sixty (60) days after the date of the purchase agreement. The purchase agreement shall provide for Owner to deliver to Purchaser copies of all plans, studies, records, reports, governmental notices and approvals, and other wri tten materials related to the use, occupancy or condition of the Property that Owner has in its possession, including without limitation environmental, structural, mechanical, engineering and land surveys. Purchaser shall provide Owner with comments to th e form of purchase agreement within fifteen (15) business days of its receipt thereof, and Owner and Purchaser shall use good faith efforts to negotiate, draft and execute a mutually acceptable purchase agreement as soon as practicable thereafter.
The purchase agreement shall provide for closing for the conveyance to Purchaser of good and marketable title to the Property at the Sales Price within the time set forth in Section 8(a) hereof. 532
6 Section 8. Closing.
(a) The closing of the Conveyance (“ Closing”) shall take place , in the case of a Conveyance pursuant to Section 4 hereof, not later than the ninetieth (90th) calendar day following the Owner’s receipt of the Exercise Notice, or as soon as possible thereafter, and in the case of a mandatory conveyance pursuant to Sect ion 5 hereof, not later than the ninetieth (90th) calendar day following the retirement of all Project Debt, or as soon as possible thereafter.
(b) All general and special real property taxes and assessments, and rents shall be prorated as of the Closing, with Purchaser responsible for all such items to the extent arising or due at any time following the closing. General real property taxes shall be prorated at the time of Closing based on the net general real property taxes for the year of Closing.
Section 9. Recording. This Agreement, and any amendment thereto, shall be recorded with the recorder’s office of the County; provided, that upon termination of the term of this Agreement, Host shall cooperate with Owner to remove any such recorded Agreement or amendment thereto from title to the Property upon Owner’s reasonable request therefor and, in any event, by no later than thirty (30) days after the expiration of the original term of this Agreement.
Section 10. Subordination. This Agreement shall be subordinate to any claim, pledge or interest in the Property securing the Bonds or any Project Debt.
Section 11. Annual Host Charge. On each anniversary of the Issue Date, commencing on the first anniversary thereof, and on the earlier of (i) the Closing of the Conveyance or (ii) the date on which no Project Debt remains Outstanding (which earlier date shall be the final Annual Host Charge due hereunder) , Owner shall pay to Host the Annual Host Charge. The final Annual Host Charge shall be prorated for the actual number of days elapsed since the most recent Annual Host Charge. For purposes of this Section, the term “Issue Date” shall mean the date of issuance of the Bonds, currently expected to occur on _________________, 20__; and the term “Annual Host Charge” shall mean an annual charge payable in arrears in the amount of $108,000, inflated annually for each Annual Host Charge payable after the first anniversary by 2% of the most recent Annual Host Char ge. Host represents, acknowledges and agrees that neither Owner, nor Project Administrator nor their representatives have made any representation or warranty about the validity or enforceability of the Annual Host Charge and that Host has sought and relied exclusively upon its own independent legal advice concerning the same.
Section 12. Assignment. Neither party to this Agreement shall assign its interests, obligations, rights and/or responsibilities under this Agreement without the prior written consent of the other party, except as provided herein.
Section 13. Limitation on Liability.
(a) The Owner and Host shall not be directly, indirectly, contingently or otherwise liable for any costs, expenses, losses, damages, claims or actions, of any conceivable kind on any conceivable theory, under or by reason of or in connection with this Agreement or any sale or Conveyance or failure or price thereof or application of proceeds thereof, except only as to moneys available therefor under and in accordance with the Indenture or this Agreement.
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7 (b) No Owner Indemnified Person or Host Indemnified Person shall be individually or personally liable for the payment of any sum hereunder or be subject to any personal liability or accountability by reason of the execution and delivery of this Agreemen t, or by any proceedings for the sale or Conveyance or failure or price thereof, or Host’s exercise or waiver of same, or otherwise except in the case of such Owner Indemnified Person’s own willful misconduct.
(c) The Bonds will not be a debt, liability or obl igation of Host but rather, solely indebtedness of the Owner, limited to the Trust Estate pledged and available therefor under the Indenture. Under no circumstances shall Host be obligated to (i) provide any financing to acquire or construct the Project o r any refinancing of the Project; (ii) approve any application or request for or take any other action in connection with any planning approval, permit or other action necessary for the acquisition, construction, rehabilitation or operation of the Project; or (iii) make any contribution or advance any funds whatsoever to the Owner.
Section 14. Notices, Governing Law, Binding Effect and Other Miscellaneous Provisions.
(a) Notices. All notices provided for in this Agreement shall be in writing and shall be given to Owner or Host at the address set forth below or at such other address as they individually may specify thereafter by written notice in accordance herewith:
If to Owner or:
Designated Agent
CMFA Special Finance Agency XV
2111 Palomar Airport Road, Suite 320
Carlsbad, California 92011
Attention: Financial Advisor
With a copy to: HomeFed Asset Management LLC
1903 Wright Place, Suite 220
Carlsbad, California 92008
Attention: Chris Foulger, Erin Ruhe and
Shaun Bradley
Email: cfoulger@hfc -ca.com; eruhe@hfc-
ca.com; [email protected]
If to Host: City of Oxnard
300 West Third Street
4th Floor
Oxnard, California 93030
Attention: City Manager
With a copy to: City of Oxnard
Office of the City Attorney
350 West Third Street, Suite 100E
Oxnard, California 93030
Email: [email protected]
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8 Such notices shall be deemed effective upon actual delivery or upon the date that any such delivery was attempted and acceptance thereof was refused, or if mailed, certified return receipt requested, postage prepaid, properly addressed, three (3) days after posting. (b) Consents and Approvals . All consents and approvals and waivers required or asserted hereunder shall be in writing, signed by the party from whom such consent, approval, waiver or notice is requested.
(c) Non-Liability of Host or Owner Officers and Employees . No officer or employee of the Host shall be personally liable to the Owner, or any successor in interest, in the event of any default or breach by Hos t of any obligation of the terms of this Agreement. No officer or employee of the Owner shall be personally liable to Host, or any successor in interest, in the event of any default or breach by Owner of any obligation of the terms of this Agreement. (d) Pronouns. Where appropriate to the context, words of one gender include all genders, and the singular includes the plural and vice versa. (e) Amendments. This Agreement may not be modified except in a written instrument signed by Host and Owner.
(f) Complete Agreemen t; Benefits . This Agreement together with all schedules and exhibits attached hereto and made part thereof supersedes all previous agreements, understandings and representations made by or between the parties hereto. This Agreement shall inure solely and exclusively to the benefit of the Owner and Host, and no other party shall have any right, remedy or claim under or by reason of this Agreement. (g) Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of California, without regard to conflicts of law principles.
All claims of whatever character arising out of this Agreement, or under any statute or common law relating in any way, directly or indirectly, to the subject matter hereof or to the dealings between Owner and any other party hereto, if and to the extent that such claim potentially could or actually does involve Owner, shall be filed and maintained in the Superior Court of California, County of Ventura, California. By executing and delivering this A greement, each party hereto irrevocably: (i) accepts generally and unconditionally the exclusive jurisdiction and venue of such court; (ii) waives any defense of forum non -conveniens; and (iii) agrees not to seek removal of such proceedings to any court or forum other than as specified above. The foregoing shall not be deemed or construed to constitute a waiver by Owner of any prior notice or procedural requirements applicable to actions or claims against or involving governmental units and/or political sub divisions of the State of California that may exist at the time of and in connection with such matter.
(h) [Reserved].
(i) Term. This Agreement shall terminate upon the Conveyance. (j) Captions. The captions used in this Agreement are solely for convenience and shall not be deemed to constitute a part of the substance of the Agreement for purpose of its construction.
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9 (k) Counterparts. This Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an o riginal; and all such counterparts shall together constitute but one and the same Agreement. (l) Regulatory Agreement . Owner shall not amend the Regulatory Agreement to increase the maximum income levels or maximum rents of the Affordable Units, or to revise the percentages of units to be rented as Low Income Units, Median Income Units and Moderate Income Units, without the prior written approval of Host, which approval shall not unreasonably be withheld.
(m) [Reserved.]
(n) Community Facilities District No. 5 . The Owner agrees to pay, and not challenge the validity of, the special taxes levied for Host’s Community Facilities District No. 5. (o) No Challenge to Validity . On behalf of itself and its officers, officials, employees and agents, Owner agrees not to challenge th e validity of th is Agreement or any portion thereof.
[SIGNATURE PAGE TO FOLLOW]
536
[Signature Page – Public Benefit Agreement – The Vines at Riverpark] IN WITNESS WHEREOF , the parties have executed this Agreement as of the date set forth above.
CMFA SPECIAL FINANCE AGENCY XV
By:
Edward J. Becker
Executive Director
537
[Signature Page – Public Benefit Agreement – The Vines at Riverpark]
CITY OF OXNARD
By:
John C. Zaragoza, Mayor
ATTEST:
By:___________________________
City Clerk
APPROVED AS TO FORM:
By:___________________________
City Attorney
538
A Notary Public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
State of California )
County of ______________________ )
On _________________________, before me, ,
(insert name and title of the officer)
Notary Public, personally appeared ,
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature (Seal)
539
EXHIBIT A
LEGAL DESCRIPTION OF REAL PROPERTY
The Land referred to herein is situated in the State of California, County of Ventura, City of Oxnard, and described as follows:
[TO COME]
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[JH Draft 1-25-22]
RECORDING REQUESTED
AND WHEN RECORDED MAIL TO:
Jones Hall, A Professional Law Corporation
475 Sansome Street, Suite 1700
San Francisco, California 94111
Attention: Josh D. Anzel, Esq. THIS SPACE IS FOR RECORDERS USE ONLY
REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
(Title of Document)
Per Government Code 27388.1 (a)(1) “A fee of $75 dollars shall be paid at the time of recording of every real estate instrument, paper, or notice required or permitted by law to be recorded, except those expressly exempted from payment of recording fees, per each single transaction per parcel or real property. The fee shall not exceed two hundred twenty-five dollars ($225)” Reason for Exemption:
☐ Exempt from fee per GC 27388.1 (a) (2); recorded concurrently “in connection with” a transfer subject to the imposition of documentary transfer tax (DTT). ☐ Exempt from fee per GC 27388.1 (a) (2); recorded concurrently “in connection with” a transfer of real property that is a residential dwelling to an owner-occupier. ☒ Exempt from fee per GC 27388.1 (a) (2) (D); recording fee exempt under GC 27383. ☐ Exempt from fee per GC 27388.1 (a) (1); fee cap of $225.00 reached. ☐ Exempt from the fee per GC 27388.1 (a) (1); not related to real property.
Failure to include an exemption reason will result in the imposition of the $75.00 Building Homes and Job Act Fee.
541
RECORDING REQUESTED BY AND
WHEN RECORDED RETURN TO:
Jones Hall, A Professional Law Corporation
475 Sansome Street, Suite 1700
San Francisco, California 94111
Attention: Josh D. Anzel, Esq.
REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
By and Between
CMFA SPECIAL FINANCE AGENCY XV
and
WILMINGTON TRUST, NATIONAL ASSOCIATION,
as Trustee
Dated as of ________________ 1, 20__
Relating to
CMFA Special Finance Agency XV
Senior Essential Housing Revenue Bonds, Series 20__A-1
(The Vines at Riverpark)
CMFA Special Finance Agency XV
Junior Essential Housing Revenue Bonds, Series 20__A-2
(The Vines at Riverpark)
and
CMFA Special Finance Agency XV
Subordinate Essential Housing Revenue Bonds, Series 20__B (The Vines at Riverpark)
542
TABLE OF CONTENTS
Clause Page
Section 1. Definitions and Interpretation ................................ ................................ ............. 1 Section 2. Representations, Covenants and Warranties of the Owner ................................ 4 Section 3. Residential Rental Project ................................ ................................ .................. 4 Section 4. Tenants; Income Requirements ................................ ................................ ......... 5 Section 5. Affordable Rental Requirements; Limitations on Rent Increases; Rent Reductions ................................ ................................ ................................ 7 Section 6. Tax-Exempt Status of Bonds ................................ ................................ ............. 8 Section 7. Requirements of the Owner ................................ ................................ ............... 8 Section 8. Modification of Covenants ................................ ................................ .................. 9 Section 9. Indemnification ................................ ................................ ................................ ... 9 Section 10. Consideration ................................ ................................ ................................ ..... 9 Section 11. Reliance ................................ ................................ ................................ ............. 9 Section 12. Transfer of the Project ................................ ................................ ....................... 9 Section 13. Term ................................ ................................ ................................ .................10 Section 14. Covenants to Run With the Land ................................ ................................ ......11 Section 15. Burden and Benefit ................................ ................................ ...........................11 Section 16. Uniformity; Common Plan ................................ ................................ .................11 Section 17. Default; Enforcement ................................ ................................ ........................12 Section 18. [Reserved] ................................ ................................ ................................ ........12 Section 19. Recording and Filing ................................ ................................ .........................12 Section 20. Reserved ................................ ................................ ................................ ..........13 Section 21. Governing Law; Venue ................................ ................................ .....................13 Section 22. Amendments; Waivers ................................ ................................ ......................13 Section 23. Notices ................................ ................................ ................................ ..............13 Section 24. Severability ................................ ................................ ................................ .......14 Section 25. Multiple Counterparts ................................ ................................ ........................14 Section 26. Limitation on Liability ................................ ................................ .........................14 Section 27. Annual Reporting Covenant ................................ ................................ ..............14
EXHIBIT A DESCRIPTION OF REAL PROPERTY
EXHIBIT B FORM OF INCOME CERTIFICATION
EXHIBIT C FORM OF CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE 543
1 REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
THIS REGULATORY AGREEMENT AND DECLARATION OF RESTRICTIVE COVENANTS (as supplemented and amended from time to time, this “Regulatory Agreement”) is made and entered into as of ________________ 1, 20__, by and between the CMFA SPECIAL FINANCE AGENCY XV, a joint exercise of powers authority duly organized and existing under the laws of the State of California, as issuer of the Bonds (as further defined herein) and as owner of the Project identified herein (together with any successor to its rights, duties and obligations hereunder, the “Owner”), and WILMINGTON TRUST, NATIONAL ASSOCIATION , a national banking association, as trustee (together with its successors in trust and assigns, the “Trustee”).
W I T N E S S E T H:
WHEREAS, pursuant to Chapter 5 of Division 7 of Title 1 of the California Government Code (the “ Act”), the Owner proposes to issue its Senior Essential Housing Revenue Bonds, Series 20__A-1 (The Vines at Riverpark ) (the “Series 20__A-1 Bonds”), Junior Essential Housing Revenue Bonds, Series 20__A-2 (The Vines at Riverpark ) (together with the Series 20__A-1 Bonds, the “Series A Bonds”), and Subordinate Essential Housing Revenue Bonds, Series 20__B (The Vines at Riverpark ) ( together with the Series A Bonds, the “ Bonds”) pursuant to a Trust Indenture, dated as of ________________ 1, 20__ (as supplemented and amended from time to time, the “Indenture”), between the Owner and the Trustee; WHEREAS, a portion of the proceeds of the Bonds will be used to provide, in part, financing for the acquisition of the multifamily rental housing project known as The Vines at Riverpark, located on the real property site described in Exhibit A hereto (as further described herein, the “Project”);
WHEREAS, to satisfy the public purposes f or which the Bonds are authorized to be issued under the Act, and in furtherance of certain specific public purposes of the Owner, previously approved by the Owner’s Resolution No. __-_____________, which include supporting, preserving and providing low in come, median income and moderate income multifamily rental housing in areas in which demand for such housing is not currently being adequately met, certain limits on the occupancy of units in the Project need to be established and certain other requirements need to be met;
NOW, THEREFORE, in consideration of the issuance of the Bonds by the Owner and the mutual covenants and undertakings set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged , the Owner and the Trustee hereby agree as follows:
Section 1. Definitions and Interpretation . Unless the context otherwise requires, the capitalized terms used herein shall have the respective meanings assigned to them in the recitals hereto, in this Section 1, or in the Master Glossary of Terms, dated as of ________________ 1, 20__.
“Administrator” means any administrator or program monitor appointed by the Owner to administer this Regulatory Agreement, and any successor administrator appointed by the Owner. “Area” means the Metropolitan Statistical Area or County, as applicable, in which the Project is located, as defined by HUD.
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2 “Bonds” has the meaning given to it in the recitals hereto. “Certificate of Continuing Program Compliance” means the Certificate to be filed by the Owner with the Administrator, pursuant to Section 4(e) hereof, which shal l be substantially in the form attached as Exhibit C hereto or in such other comparable form as may be provided by the Owner.
“City” means the City of Oxnard, California.
“Closing Date” means ________________, 20__, the date the Bonds are issued and delivered to the initial purchaser thereof.
“Compliance Period” means the period beginning on the Closing Date and ending on the first date on which there are no Bonds Outstanding.
“County” means the County of Ventura, California.
“Deed of Trust” means the Deed of Trust, Assignment of Leases and Rents, Security Agreement, and Fixture Filing dated as of the Closing Date, by the Owner granting a lien on its fee simple interest in the Property, subject to Permitted Encumbrances, to the Trustee for the benefit of the holders from time to time of the Bonds, as the same may be modified, amended or supplemented from time to time, or any deed of trust (or similar security instrument) containing a power of sale clause reflecting a valid, perfected first priority lien on the fee interest in the Project delivered by the Owner to secure the Owner’s obligations to a third-party lender. “Gross Income” means the gross income of a person (together with the gross income of all persons who reside with such person in one reside ntial unit) as calculated in the manner prescribed by Section 8 of the Housing Act.
“Housing Act” means the United States Housing Act of 1937, as amended, or its successor. “HUD” means the United States Department of Housing and Urban Development. “Income Certification” means a Tenant Income Certification and a Tenant Income Certification Questionnaire in the form attached as Exhibit B hereto or in such other comparable form as may be provided by the Owner.
“Low Income Tenant” means a tenant occupying a Low Income Unit. “Low Income Unit” means any available unit if the aggregate Gross Income of all tenants therein does not exceed sixty percent ( 60%) of median gross income for the Area, with adjustments for family size. The determination of an available unit’s status as a Low Income Unit shall be made by the Owner upon commencement of each lease term with respect to such unit, and annually thereafter, on the basis of an Income Certification executed by each tenant. A vacant unit that was most recently determined to be a Low Income Unit in accordance with the previous sentence will remain a Low Income Unit for purposes of Section 4(a)(i) hereof until that unit is reoccupied.
“Management Agreement” means that certain Property Management Agreement, dated a s of the date hereof, by and among the Owner and the Manager. 545
3 “Manager” means the property manager , and any other Person who is an assignee of the initial Management Agreement.
“Median Income Tenant” means a tenant occupying a Median Income Unit. “Median Income Unit” means any available unit if the aggregate Gross Income of all tenants therein does not exceed one hundred percent (100%) of median gross income for the Area, with adjustments for family size. The determination of an available unit’s status as a Median Income Unit shall be made by the Owner upon commencement of each lease term with respect to such unit, and annually thereafter, on the basis of an Income Certification executed by each tenant. A vacant unit that was most recently determined to be a Median Income Unit in accordance with the previous sentence will remain a Median Income Unit for purposes of Section 4(a)(ii) hereof until that unit is reoccupied.
“Moderate Income Tenant” means (i) a tenant occupying a Moderate Income Unit or (ii) an Over Income Tenant if such tenant occupied an available unit on the effective date of this Regulatory Agreement.
“Moderate Income Unit” means any available unit if the aggregate Gross Income of all tenants therein does not exceed one hundred and twenty percent (120%) of median gross income for the Area, with adjustments for family size. The determination of an availa ble unit’s status as a Moderate Income Unit shall be made by the Owner upon commencement of each lease term with respect to such unit, and annually thereafter, on the basis of an Income Certification executed by each tenant. A vacant unit that was most recently determined to be a Moderate Income Unit in accordance with the previous sentence will remain a Moderate Income Unit for purposes of Section 4(a)(iii) hereof until that unit is reoccupied.
“Over Income Tenant” means a tenant occupying an Over Income Unit. “Over Income Unit” means any occupied unit in which the aggregate gross income of all tenants therein exceeds one hundred twenty percent (120%) of median gross income for the Area, with adjustments for family size.
“Project” means the 164-unit multifamily rental housing development to be located in the City on the real property site described in Exhibit A hereto, consisting of those facilities, including real property, structures, buildings, fixtures or equipment situated thereon, as it may at any t ime exist, the acquisition of which facilities is to be financed, in whole or in part, from the proceeds of the sale of the Bonds, and any real property, structures, buildings, fixtures or equipment acquired in substitution for, as a renewal or replacement of, or a modification or improvement to, all or any part of the facilities described in the Deed of Trust.
“Regulations” means the Income Tax Regulations of the Department of the Treasury applicable under the Code from time to time.
“Regulatory Agreement” means this Regulatory Agreement and Declaration of Restrictive Covenants, as it may be supplemented and amended from time to time. “Rental Payments” means the rental payments paid by the occupant of a unit, excluding any supplemental rental assistance to the occupant from the State, the federal government, or any other public agency.
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4 “Tax-Exempt” means with respect to interest on any obligations of a state or local government, including the Bonds, that such interest is excluded from gross income for State of California personal income and federal income tax purposes; provided, however, that such interest may be includable as an item of tax preference or otherwise includable directly or indirectly for purposes of calculating other tax liabilities, including any alternative minimum tax or environmental tax, under the Code.
“TCAC” means the California Tax Credit Allocation Committee. “Transfer” means the conveyance, assignment, sale or other disposition of all or any portion of the Project; and shall also inclu de, without limitation to the foregoing, the following: (1) an installment sales agreement wherein Owner agrees to sell the Project or any part thereof for a price to be paid in installments; and (2) an agreement by the Owner leasing all or a substantial part of the Project to one or more persons or entities pursuant to a single or related transactions.
Unless the context clearly requires otherwise, as used in this Regulatory Agreement, words of any gender shall be construed to include each other gender whe n appropriate and words of the singular number shall be construed to include the plural number, and vice versa, when appropriate.
This Regulatory Agreement and all the terms and provisions hereof shall be construed to effectuate the purposes set forth herein and to sustain the validity hereof.
The titles and headings of the sections of this Regulatory Agreement have been inserted for convenience of reference only and are not to be considered a part hereof and shall not in any way modify or restrict any of t he terms or provisions hereof or be considered or given any effect in construing this Regulatory Agreement or any provisions hereof or in ascertaining intent, if any question of intent shall arise.
The parties to this Regulatory Agreement acknowledge that each party and their respective counsel have participated in the drafting and revision of this Regulatory Agreement. Accordingly, the parties agree that any rule of construction to the effect that ambiguities are to be resolved against the drafting party s hall not apply in the interpretation of this Regulatory Agreement or any supplement or exhibit hereto.
Section 2. Representations, Covenants and Warranties of the Owner. (a) The Owner hereby incorporates herein, as if set forth in full herein, each of the representations, covenants and warranties of the Owner contained in the Tax Certificate and the Indenture relating to the Project.
(b) The Owner hereby represents and warrants that the Project is located entirely within the City.
(c) The Owner acknowledges, represents and warrants that it understands the nature and structure of the transactions contemplated by this Regulatory Agreement; that it is familiar with the provisions of all of the documents and instruments relating to the Bonds to which it is a party or of which it is a beneficiary; that it understands the financial and legal risks inherent in such transactions.
Section 3. Residential Rental Project . For the term of this Regulatory Agreement, the Owner hereby represents, covenants, warrants and agrees as follows:
547
5 (a) The Project will be owned and operated for the purpose of providing multifamily residential rental proper ty. The Owner will own, and cause the Project to be managed and operated, as a project to provide multifamily residential rental property comprised of a building or structure or several interrelated buildings or structures, together with any functionally r elated and subordinate facilities, in accordance with such requirements as may be imposed thereby on the Project from time to time. The Owner shall cause the Project to be maintained in a good, habitable and safe (so as to not threaten the health or safety of the Project’s tenants or their invited guests) condition and repair (reasonable wear and tear excepted) and shall create and fund a Capital Expense Fund and shall cause Capital Repairs to be made on an annual basis during the Compliance Period. Capital Repairs shall include, without limitation, the following: carpet and drape replacement; appliance replacement; exterior painting, including exterior trim; hot water heater replacement; plumbing fixtures replacement, including tubs and showers, toilets, la vatories, sinks, faucets; air conditioning and heating replacement; asphalt repair and replacement, and seal coating; roofing repair and replacement; landscape tree replacement; irrigation pipe and controls replacement; sewer line replacement; water line r eplacement; gas line pipe replacement; lighting fixture replacement; elevator replacement and upgrade work; miscellaneous motors and blowers; common area furniture replacement; and common area and exterior repainting. (b) Except as otherwise approved by the Owner, all of the dwelling units in the Project (except for the units set aside for resident managers or other administrative uses) will be similarly constructed units, and each dwelling unit in the Project will contain complete separate and distinct facilities for living, sleeping, eating, cooking and sanitation for a single person or a family, including a sleeping area, bathing and sanitation facilities and cooking facilities equipped with a cooking range, refrigerator and sink.
(c) None of the dwelli ng units in the Project will ever be used as a hotel, motel, dormitory, fraternity house, sorority house, rooming house, nursing home, hospital, sanitarium, rest home or trailer court or park; provided that the use of certain units for tenant guests on an intermittent basis shall not be considered transient use for purposes of this Regulatory Agreement.
Owner shall not rent dwelling units for a term of 30 days or less, and shall use commercially reasonable efforts to inform residents that short-term rentals of 30 days or less are prohibited. (d) No part of the Project will at any time during the Compliance Period be owned by a cooperative housing corporation, nor shall the Owner take any steps in connection with a conversion to such ownership or use, and the Owner will not take any steps in connection with a conversion of the Project to condominium ownership during the Compliance Period. (e) All of the available units in the Project will be available for rental during the period beginning on the date hereof a nd ending on the termination of the Compliance Period on a continuous basis.
Section 4. Tenants; Income Requirements. The Owner shall comply, or shall cause the Manager to comply, with the following requirements:
(a) During the Compliance Period, except for units occupied by residential managers, for which no income or rent restrictions shall apply, the Owner shall ensure that the following income restrictions are met at all times:
(i) no less than five percent (5%) of the completed residential units in the Project shall be Low Income Units;
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6 (ii) no less than thirty percent (30%) of the completed residential units in the Project shall be Median Income Units; and
(iii) the balance of the completed residential units in the Project shall be Moderate Income Units;
provided, that any unit remaining vacant for at least 30 consecutive days may be offered and leased as a Low Income Unit, Median Income Unit or Moderate Income Unit without regard for the requirements set forth in sub -paragraphs (i), (ii) and (iii) above. For the avoidance of doubt, any vacant unit shall only be offered as a Low Income Unit, Median Income Unit or Moderate Income Unit.
(b) No tenant shall be denied continued occupancy of a unit in the Project because, after admission, the aggregate Gross Income of all tenants in the unit occupied by such tenant increases to exceed the qualifying limit for the respective Low Income Unit, Median Income Unit or Moderate Income Unit initially occupi ed by such tenant . However, if after a tenant’s initial occupancy of a Low Income Unit, Median Income Unit or Moderate Income Unit, as applicable, the aggregate Gross Income of tenants in such unit, as of the most recent determination thereof, exceeds that which is defined for such unit occupied by the same number of tenants, the next available unit of comparable or smaller size shall, subject to the discretion of the Owner and Manager as described in the next succeeding paragraph, be rented (or held vacant and available for immediate occupancy) in a manner that would maintain the unit mix required by Section 4(a) hereof. For the avoidance of doubt, this Section 4(b) shall apply to existing tenants occupying the Project on the Closing Date.
Notwithstanding a ny provision of this Regulatory Agreement to the contrary, the Owner shall verify, or cause the Manager to verify, all tenant incomes at least annually and shall continually re -balance the mix of household incomes by leasing vacant units to Low Income Tenants, Median Income Tenants or Moderate Income Tenants as needed to meet the income set- aside requirements set forth in this Section 4(a).
(c) For the Compliance Period, the Owner shall cause the Manager to obtain, complete and maintain on file Income Certi fications for each tenant, including (i) an Income Certification dated immediately prior to the initial occupancy of such tenant in the unit and a second Income Certification dated one year after the tenant’s initial move -in date, and (ii) thereafter, an a nnual verifiable self -certification with respect to each tenant . The Owner shall, or shall cause the Manager to, provide such additional information as may be required in the future by applicable rules, rulings, policies, procedures, Regulations or other o fficial statements now or hereafter promulgated, proposed or made by the Department of the Treasury or the Internal Revenue Service with respect to Tax -Exempt obligations. Upon request of the Administrator or the Trustee, copies of Income Certifications fo r tenants commencing or continuing occupation of a residential unit shall be submitted to the Administrator or the Trustee, as requested. (d) The Owner shall cause the Manager to verify that the income information provided by an applicant in an Income Certification is accurate by taking one or more of the following steps as a part of the verification process: (1) obtain pay stubs for the three most recent pay periods, (2) obtain an income tax return for the most recent tax year, (3) obtain a credit repo rt or conduct a similar type credit search, (4) obtain an income verification from the applicant’s current employer, (5) obtain an income verification from the Social Security Administration and/or the California Department of Social Services if the applicant receives assistance from either of such agencies, or 549
7 (6) if the applicant is unemployed and does not have an income tax return, obtain another form of independent verification reasonably acceptable to the Owner. (e) The Owner shall prepare and submit or cause the Manager to prepare and submit to the Administrator not less than annually, commencing not less than one year after the Closing Date, a Certificate of Continuing Program Compliance executed by the Owner in substantially the form attached hereto as Exhibit C.
(f) For the Compliance Period, all tenant leases or rental agreements shall be subordinate to this Regulatory Agreement and the Deed of Trust. All leases shall contain clauses, among others, wherein each tenant: (i) certifies the accuracy of the statements made by such tenant in the Income Certification; (ii) agrees that the family income and other eligibility requirements shall be deemed substantial and material obligations of the tenancy of such tenant, that such tenant will comply promptly with all requests for information with respect thereto from the Owner or the Administrator on behalf of the Owner, and that the failure to provide accurate information in the Income Certification or self -certification or refusal to comply with a request fo r information with respect thereto shall be deemed a violation of a substantial obligation of the tenancy of such tenant; (iii) acknowledges that the Owner has relied on the statements made by such tenant in the Income Certification and supporting informat ion supplied by the tenant in determining qualification for occupancy of a Low Income Unit, Median Income Unit or Moderate Income Unit, as applicable, and that any material misstatement in such certification (whether or not intentional) will be cause for i mmediate termination of such lease or rental agreement; and (iv) agrees that the tenant’s income is subject to annual certification in accordance with Section 4(c) and that if upon any such certification the aggregate Gross Income of tenants in such unit e xceeds the applicable income limit under Section 4(b), the unit occupied by such tenant may cease to qualify as a Low Income Unit, Median Income Unit or Moderate Income Unit, as applicable, and such unit’s rent may be subject to increase.
(g) In reviewing and considering applications from prospective tenants, the Owner shall provide a preference to households which include one or more persons who live, work, or have been hired to work in the City, have graduated from a City high school, are employed by a pu blic school district in the City, and/or are employed as a first responder.
Section 5. Affordable Rental Requirements; Limitations on Rent Increases; Rent Reductions. During the Compliance Period, except for units occupied by residential managers, for which no income or rent restrictions shall apply, in addition to the other requirements set forth herein, the Owner hereby agrees that it shall comply , or cause the Manager to comply, with the following:
(a) The Rental Payments for the Low Income Units paid by the tenants thereof shall not exceed 35% of the Low Income limit for the County, adjusted for household size, as published annually by HUD and utilized by TCAC.
(b) The Rental Payments for the Median Income Units paid by the tenants thereof shall not exceed 35% of the Median Income limit for the County, adjusted for household size, as published annually by HUD and utilized by TCAC.
(c) The Rental P ayments for the Moderate Income Units paid by the tenants thereof shall not exceed 35% of the Moderate Income limit for the County, adjusted for household size, as published annually by HUD and utilized by TCAC.
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8 (d) The Owner shall accept as tenants, on th e same basis as all other prospective tenants, qualified low-income persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing program under Section 8 of the Housing Act.
For purposes of this Section 5, base rents shall be adjusted for household size using the following assumptions:
Unit Size Assumed Occupancy
studio 1
one-bedroom 2
two-bedroom 3
three-bedroom 4
four-bedroom 5
(e) The following limitations shall apply to annual rent increases for households occupying available units in the Project:
(i) For a household qualifying as a Low Income Unit, a Median Income Unit, or a Moderate Income Unit, as applicable, but for which annual rent payable is lower than the applicable limit set forth in paragraph (a), (b) or (c) above, respectively, rent shall not be increased more than 4% annually and then only up to the applicable limit set forth in such paragraphs above. (ii) For a household qualifying as a Low Income Unit, a Median Income Unit, or a Moderate Income Unit, as applicable, but for which annual rent payable exceeds the applicable limit set forth in paragraph (a), (b) or (c) above, respectively, rent shall be decreased as soon as practicable to the applicable limit set forth in such paragraphs above.
Except as set forth in Section 13 hereof, the covenants and conditions of this Regulatory Agreement shall be binding upon successors in interest of the Owner.
Section 6. Tax-Exempt Status of Bonds . The Owner hereby represents, warrants and agrees as follows:
(a) The Owner will not knowingly take or permit, or omit to take or cause to be taken, as is appropriate, any action that would adversely affect the Tax -Exempt nature of the interest on the Bonds and, if it should take or permit, or omit to take or cause to be taken, any such action, it will take all lawful actions necessary to rescind or correct such actions or omissions promptly upon obtaining knowledge thereof.
(b) The Owner will file of reco rd such documents and take such other steps as are necessary, in the written opinion of Bond Counsel filed with the Owner, in order to ensure that the requirements and restrictions of this Regulatory Agreement will be binding upon all owners of the Project, including, but not limited to, the execution and recordation of this Regulatory Agreement in the real property records of the County.
Section 7. Requirements of the Owner . In addition to other requirements set forth herein and to the extent not prohibited by the requirements set forth in Sections 4 through 6 hereof, the Owner hereby agrees to comply with each of the requirements set forth in this Section 7, as follows:
551
9 (a) All tenant lists, applications and waiting lists relating to the Project shall at all times be kept separate and identifiable from any other business of the Owner and shall be maintained in a reasonable condition for proper audit.
(b) The Owner shall appoint the Administrator to administer this Regulatory Agreement and to monitor performance by the Owner of the terms, provisions and requirements hereof. In the event that the Administrator resigns or is terminated, the Owner shall, following consultation with the City, appoint a successor A dministrator, experienced and capable, in the judgment of the Owner, of performing the duties under the Project Administration Agreement. The Owner shall comply with any reasonable request made by the Administrator to deliver to any such Administrator any reports, notices or other documents required to be delivered pursuant hereto, and to make the Project and the books and records with respect thereto available for inspection by the Administrator. The fees and expenses of the Administrator shall be paid by the Owner.
Section 8. Modification of Covenants . The Owner and the Trustee hereby agree as follows:
(a) To the extent any amendments to the Act, the Regulations or the Code shall, in the written opinion of Bond Counsel filed with the Trustee and the Owner, retroactively impose requirements upon the ownership or operation of the Project more restrictive than those imposed by this Regulatory Agreement, and if such requirements are applicable to the Project and compliance therewith is necessary to maintain the validity of, or the Tax -Exempt status of interest on the Bonds, this Regulatory Agreement shall be deemed to be automatically amended to impose such additional or more restrictive requirements.
(b) The Owner and the Trustee shall execute, deliver and, if applicable, file of record any and all documents and instruments necessary to effectuate the intent of this Section 8.
Section 9. Indemnification. The Owner and the Trustee will be indemnified as required by and pursuant to the Project Administration Agreement.
Section 10. Consideration. The Owner has agreed to issue the Bonds and to use the proceeds thereof to, among other th ings, finance the acquisition of the Project. In furtherance of the significant public benefits of the Project, the Owner has entered into this Regulatory Agreement and has agreed to restrict the uses to which this Project can be put on the terms and conditions set forth herein.
Section 11. Reliance. The Owner and the Trustee hereby recognize and agree that the representations and covenants set forth herein may be relied upon by all persons, including but not limited to the A dministrator, interested in the legality and validity of the Bonds, in the exemption from California personal income taxation of interest on the Bonds and in the Tax -Exempt status of the interest on the Bonds. In performing their duties and obligations her eunder, the Owner and the Administrator may rely upon statements and certificates of the tenants, and upon audits of the books and records of the Owner pertaining to the Project. In addition, the Owner may consult with counsel, and the opinion of such coun sel shall be full and complete authorization and protection in respect of any action taken or suffered by the Owner hereunder in good faith and in conformity with such opinion.
Section 12. Transfer of the Project . For the Compliance Period, except as permitted by the Indenture or the Public Benefit Agreement, the Owner shall not Transfer the Project, in whole or in part, unless the following conditions are satisfied: (A) the receipt by the Owner and the 552
10 Trustee of evidence acceptable to the Owner and the Trustee that (1) the Owner shall not be in default hereunder, if in effect (which may be evidenced by a Certificate of Continuing Program Compliance), or the transferee reasonably undertakes to cure any defaults of the Owner; (2) the continued operation of the Project shall comply with the provisions of this Regulatory Agreement; (3) all rights, responsibilities and duties of the transferor under the Project Administration Agreement shall have been assigned to th e transferee, or the transferee shall enter into a new project administration agreement in the form of the current Project Administration Agreement; and (4) the person or entity that is to acquire the Project does not have pending against it, and does not have a history of significant and material building code violations or complaints concerning the maintenance, upkeep, operation, and regulatory agreement compliance of any of its projects as identified by any local, state or federal regulatory agencies; (B ) the execution by the transferee of any document reasonably requested by the Owner with respect to the assumption of the Owner’s obligations under this Regulatory Agreement, including without limitation an instrument of assumption hereof and thereof, and delivery to the Owner of an opinion of such transferee’s counsel to the effect that each such document and this Regulatory Agreement are valid, binding and enforceable obligations of such transferee, subject to bankruptcy and other standard limitations affecting creditor’s rights; (C) receipt by the Owner of an opinion of Bond Counsel to the effect that any such Transfer will not adversely affect the Tax -Exempt status of interest on the Bonds; (D) receipt by the Owner of all fees and/or expenses then curren tly due and payable to the Owner.
It is hereby expressly stipulated and agreed that any Transfer of the Project in violation of this Section 12 shall be null, void and without effect, shall cause a reversion of title to the Owner, and shall be ineffective to relieve the Owner of its obligations under this Regulatory Agreement.
Nothing in this Section shall affect any provision of any other document or instrument between the Owner and any other party which requires the Owner to satisfy certain conditions or obtain the prior written consent of such other party in order to Transfer the Project. Upon any Transfer that complies with this Regulatory Agreement, the Owner shall be fully released from its obligations hereunder to the extent such obligations have been fully assumed in writing by the transferee of the Project.
The foregoing notwithstanding, the Project may be transferred pursuant to a foreclosure, exercise of power of sale or deed in lieu of foreclosure or comparable conversion under the Deed of Trust without the consent of the Owner or compliance with the provisions of this Section 12.
For the Compliance Period, the Owner shall not: (1) encumber any of the Project or grant commercial leases of any part thereof, or permit the conveyance, transfer or encu mbrance of any part of the Project, except for (A) encumbrances permitted under the Deed of Trust, or (B) a Transfer in accordance with the terms of this Regulatory Agreement, in each case upon receipt by the Owner of an opinion of Bond Counsel to the effe ct that such action will not adversely affect the Tax-Exempt status of interest on the Bonds (provided that such opinion will not be required with respect to any encumbrance, lease or transfer relating to a commercial operation or ancillary facility that will be available for tenant use and is customary to the operation of multifamily housing developments similar to the Project); (2) demolish any part of the Project or substantially subtract from any real or personal property of the Project, except to the e xtent that what is demolished or removed is replaced with comparable property or such demolition or removal is otherwise permitted by the Deed of Trust; or (3) permit the use of the dwelling accommodations of the Project for any purpose except rental residences.
Section 13. Term. This Regulatory Agreement and all and several of the terms hereof shall become effective upon its execution and delivery, and shall remain in full force and effect for 553
11 the period provided herein and shall terminate as to any provision not otherwise provided with a specific termination date and shall terminate in its entirety at the end of the Compliance Period.
The terms of this Regulatory Agreement to the contrary notwithstanding, the requirements of this Regulatory Agreement shall terminate and be of no further force and effect in the event of involuntary noncompliance with the provisions of this Regulatory Agreement caused by fire or other casualty, seizure, requisition, foreclosure or transfer of title by deed in lieu of foreclosure, change in a federal law or an action of a federal agency after the Closing Date, which prevents the Owner from enforcing such provisions, or condemnation or a similar event, but only if, within a reasonable period, either the Bonds are retired or amounts received as a consequence of such event are used to provide a project that meets the requirements hereof; provided, however, that the preceding provisions of this sentence shall cease to apply and the restrictions contai ned herein shall be reinstated if, at any time subsequent to the termination of such provisions as the result of the foreclosure or the delivery of a deed in lieu of foreclosure or a similar event, the Owner or any related person (within the meaning of Sec tion 1.103 -10(e) of the Regulations) obtains an ownership interest in the Project for federal income tax purposes. The Owner hereby agrees that, following any foreclosure, transfer of title by deed in lieu of foreclosure or similar event, neither the Owner nor any such related person as described above will obtain an ownership interest in the Project for federal tax purposes.
Notwithstanding any other provision of this Regulatory Agreement, this Regulatory Agreement may be terminated upon agreement by the Trustee and the Owner, upon receipt by the Owner of an opinion of Bond Counsel to the effect that such termination will not adversely affect the exclusion from gross income of interest on the Bonds for federal income tax purposes. Upon the termination of th e terms of this Regulatory Agreement, the parties hereto agree to execute, deliver and record appropriate instruments of release and discharge of the terms hereof; provided, however, that the execution and delivery of such instruments shall not be necessar y or a prerequisite to the termination of this Regulatory Agreement in accordance with its terms.
Section 14. Covenants to Run With the Land . Notwithstanding Section 1461 of the California Civil Code, the Owner hereby subjects the Project to the covenants, reservations and restrictions set forth in this Regulatory Agreement. The Trustee and the Owner hereby declare their express intent that the covenants, reservations and restrictions set forth herein s hall be deemed covenants running with the land and shall pass to and be binding upon the Owner’s successors in title to the Project; provided, however, that on the termination of this Regulatory Agreement said covenants, reservations and restrictions shall expire. Each and every contract, deed or other instrument hereafter executed covering or conveying the Project or any portion thereof shall conclusively be held to have been executed, delivered and accepted subject to such covenants, reservations and rest rictions, regardless of whether such covenants, reservations and restrictions are set forth in such contract, deed or other instruments.
Section 15. Burden and Benefit . The Trustee and the Owner hereby declare their understanding and intent that the burdens of the covenants set forth herein touch and concern the land in that the Owner’s legal interest in the Project is rendered less valuable thereby. The City shall be a third party beneficiary of this Regulatory Agreement. For purposes of clarity, there are no other third party beneficiaries.
Section 16. Uniformity; Common Plan . The covenants, reservations and restrictions hereof shall apply uniformly to the entire Project in order to establish and carry out a common plan for the use of the site on which the Project is located. 554
12 Section 17. Default; Enforcement . If the Owner defaults in the performance or observance of any covenant, agreement or obligation of the Owner set forth in this Regulatory Agreement, and if such default remains uncured for a period of 60 days after notice thereof shall have been given by the Manager, the Controlling Party or the Trustee to the Owner, or for a period of 60 days from the date the Owner should, with reasonable diligence, have discovered such default, then the Trustee shall declare an “Event of Default” to have occurred hereunder; provided, however, that if the default is of such a nature that it cannot be corrected within 60 days, such default shall not constitute an Event of Default hereunder so long as (i) the Owner institutes corrective action within said 60 days and diligently pursues such acti on until the default is corrected, and (ii) in the opinion of Bond Counsel, the failure to cure said default within 60 days will not adversely affect the Tax-Exempt status of interest on the Bonds.
Following the declaration of an Event of Default hereunder, the Owner shall have the right, in its sole and absolute discretion, to replace the Manager and terminate the Property Management Agreement in accordance with its terms, and the Trustee, subject to the terms of the Indenture, may take any one or more of the following steps, in addition to all other remedies provided by law or equity:
(a) by mandamus or other suit, action or proceeding at law or in equity, including injunctive relief, require the Owner to perform its obligations and covenants her eunder or enjoin any acts or things that may be unlawful or in violation of the rights of the Trustee hereunder; (b) have access to and inspect, examine and make copies of all of the books and records of the Owner pertaining to the Project; and
(c) take such other action at law or in equity as may appear necessary or desirable to enforce the obligations, covenants and agreements of the Owner hereunder.
The Owner hereby agrees that specific enforcement of the Owner’s agreements contained herein is the only means by which the Trustee may fully obtain the benefits of this Regulatory Agreement made by the Owner herein, and the Owner therefore agrees to the imposition of the remedy of specific performance against it in the case of any Event of Default by the Own er hereunder.
The Trustee and the Owner hereby agree that cure of any Event of Default made or tendered by the Manager shall be deemed to be a cure by the Owner and shall be accepted or rejected on the same basis as if made or tendered by the Owner.
Section 18. [Reserved].
Section 19. Recording and Filing. (a) The Owner shall cause this Regulatory Agreement and all amendments and supplements hereto and thereto, to be recorded and filed in the real property records of the County, and in such other places as the Owner may reasonably deem necessary. The Owner shall pay all fees and charges incurred in connection with any such recording.
(b) The Owner and the Trustee will file of record such other documents and take such other steps as are reasonably necessary, in the opinion of Bond Counsel, in order to ensure that the requirements and restrictions of this Regulatory Agreement will be binding upon all owners of the Project.
555
13 (c) The Owner hereby covenants to include or reference the requirements and restrictions contained in this Regulatory Agreement in any document s transferring any interest in the Project to another person to the end that such transferee has notice of, and is bound by, such restrictions, and, except in the case of a foreclosure or comparable involuntary conversion of the Deed of Trust, whereby the Trustee becomes the owner of the Project, to obtain the agreement from any transferee to abide by all requirements and restrictions of this Regulatory Agreement.
Section 20. [Reserved].
Section 21. Governing Law; Venue . This Regulatory Agreement shall be construed in accordance with and governed by the laws of the State of California applicable to contracts made and performed in the State of California. This Regulatory Agreement s hall be enforceable in the State of California, and any action arising hereunder shall (unless waived by the Owner in writing) be filed and maintained in the Superior Court of California, County of Ventura.
Section 22. Amendments; Waivers . Except as provided in Sections 8(a) hereof, this Regulatory Agreement may be amended only by a written instrument executed by the parties hereto or their successors in title, and duly recorded in the real property records of the County, California, and only upon (i) receipt by the Owner of an opinion from Bond Counsel that such amendment will not adversely affect the Tax -Exempt status of interest on the Bonds and (ii) the written consent of the Controlling Party, who shall receive a copy of any such amendment. (a) Anything to the contrary contained herein notwithstanding, the Trustee and the Owner hereby agree to amend this Regulatory Agreement to the extent required, in the opinion of Bond Counsel, in order that interest on t he Bonds remains Tax -Exempt. The parties requesting such amendment shall notify the other parties to this Regulatory Agreement of the proposed amendment, with a copy of such proposed amendment to Bond Counsel and a request that Bond Counsel render to the O wner an opinion as to the effect of such proposed amendment upon the Tax-Exempt status of interest on the Bonds. This provision shall not be subject to any provision of any other agreement requiring any party hereto to obtain the consent of any other perso n in order to amend this Regulatory Agreement.
(b) Any waiver of, or consent to, any condition under this Regulatory Agreement must be expressly made in writing.
Section 23. Notices. Any notice required to be given hereunde r shall be made in writing and shall be given by personal delivery, overnight delivery, certified or registered mail, postage prepaid, return receipt requested, or by telecopy, in each case at the respective addresses specified in the Indenture, or at such other addresses as may be specified in writing by the parties hereto. Unless otherwise specified by the Administrator, the address of the Administrator is:
To Owner: CMFA Special Finance Agency XV
2111 Palomar Airport Road, Suite 320
Carlsbad, California 92011
Attention: Financial Advisor
Email: [email protected]
With a copy to: HomeFed Asset Management LLC
1903 Wright Place, Suite 220
Carlsbad, California 92008
Attention: Chris Foulger, Erin Ruhe and Shaun Bradley
556
14 Email: [email protected]; [email protected];
[email protected]
With a copy to: City of Oxnard
Office of the City Attorney
350 West Third Street, Suite 100E
Oxnard, California 93030
Email: [email protected]
The Administrator and the Owner may, by notice given hereunder, designate any further or different addresses to which subsequent notices, certificates or other communications shall be sent. Notice shall be deemed given on the date evidenced by the postal or courier receipt or other written evidence of delive ry or electronic transmission; provided that any telecopy or other electronic transmission received by any party after 4:00 p.m., local time of the receiving party, as evidenced by the time shown on such transmission, shall be deemed to have been received the following Business Day.
Section 24. Severability. If any provision of this Regulatory Agreement shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining portions hereof shall not in any way be affected or impaired thereby.
Section 25. Multiple Counterparts. This Regulatory Agreement may be simultaneously executed in multiple counterparts, all of which shall constitute one and the same instrument, and each of which shall be deemed to be an original.
Section 26. Limitation on Liability. Notwithstanding the foregoing or any other provision or obligation to the contrary contained in this Regulatory Agreement, the liability of the Owner under this Regulatory Agreement to any person or entity, including, but not limited to, the Trustee or the Controlling Party and their successors and assigns, is limited to moneys available therefor under and in accordance with the Indenture.
Section 27. Annual Reporting Covenant. No later than January 31 of each calendar year (commencing January 31, 20 __), the Owner agrees to provide to the California Debt and Investment Advisory Commission, by any method approved by the California Debt and Investment Advisory Commission, the annual report information required by Section 8855(k)(1) of the California Government Code. This covenant shall remain in effect until the later of the date (i) the Bonds are no longer outstanding or (ii) the proceeds of the Bonds have been fully spent. 557
[Signature Page – Regulatory Agreement and Declaration of Restrictive Covenants – The Vines at Riverpark]
IN WITNESS WHEREOF, the Owner and the Trustee have executed this Regulatory Agreement by duly authorized representatives, all as of the date first above written.
CMFA SPECIAL FINANCE AGENCY XV
By:
Name: Edward J. Becker
Title: Executive Director
558
[Signature Page – Regulatory Agreement and Declaration of Restrictive Covenants – The Vines at Riverpark]
WILMINGTON TRUST, NATIONAL ASSOCIATION,
as Trustee
By:
Name:
Title:
559
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
)
COUNTY OF _____________ )
On ___________________ before me, ____________________, Notary Public, Personally appeared ___________________________
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, e xecuted the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
560
CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or validity of that document.
STATE OF CALIFORNIA )
)
COUNTY OF _____________ )
On ___________________ before me, ____________________, Notary Public, Personally appeared ___________________________
who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, e xecuted the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature of Notary Public
561
A-1
EXHIBIT A
DESCRIPTION OF REAL PROPERTY
[TO COME]
562
B-1
EXHIBIT B
FORM OF INCOME CERTIFICATION
Effective Date:
Move-In Date:
Household Size:
Floorplan:
Unit:
HOUSEHOLD COMPOSITION
Household Member Name Relationship Birthdate
1 Head
2 3
4 5
6 7
INCOME COMPOSITION (ANNUAL)
Household
Member
Employment /
Wages
Social Security /
Pension
Public
Assistance
Other
Income
1 2
3 4
5 6
7 TOTALS $ $ $ $
TOTAL INCOME $
563
C-1
EXHIBIT C
FORM OF CERTIFICATE OF CONTINUING PROGRAM COMPLIANCE
Witnesseth that on this day of _____________, 20__, the undersigned, on behalf of the CMFA SPECIAL FINANCE AGENCY XV (the “Owner”), does hereby certify with respect to the multifamily rental housing development (the “Project”) that:
1. During the preceding year (i) such Project was substantially and continually in compliance with the Regulatory Agreement and (ii ) ____% of the units in the Project were occupied by Low Income Tenants, ___% of the units in the Project were occupied by Median Income Tenants ____% of the units in the Project were occupied by Moderate Income Tenants.
Set forth below are the unit numbers of Low Income Tenants , Median Income Tenants and Moderate Income Tenants who commenced or terminated occupancy during the preceding month.
Commenced Occupancy Terminated Occupancy
1 1.
2. 2.
3. 3.
4. 4.
5. 5.
6. 6.
7. 7.
8. 8.
9. 9.
10. 10.
11. 11.
12. 12.
13. 13.
14. 14.
15. 15.
16. 16.
17. 17.
18. 18.
19. 19.
20. 20.
Additional units that have commenced or terminated occupancy may be found in an additional attached sheet
2. The units occupied by Low Income Tenants, Median Income Tenants and Moderate Income Tenants are of similar size and quality to other units and are dispersed throughout the Project. Attached is a separate sheet listing the number of each unit and indicating which units are occupied by Low Income Tenants, Median Income Tenants and Moderate Income Tenants, the size, the number of bedrooms of such units and the number of Low Income Tenants, Median Income Tenants and Moderate Income Tenants who commenced occupancy of units during the preceding month.
564
C-2
The representations set forth herein are true and correct to the best of the undersigned’s knowledge and belief.
Date: Owner:
565
CITY COUNCIL AGENDA REPORT
REPORTS
AGENDA ITEM NO. K.6
DATE: March 29, 2022
TO: City Council
FROM: Emilio Ramirez, Housing Director, (805) 385-8094, [email protected]
SUBJECT: Downtown Improvement Program Settlement Funds Update. (0/10/10)
RECOMMENDATION
That the City Council:
1. Receive an update on the implementation of the approved program priorities funded with the Downtown Improvement Program Settlement Funds; and
2. Appropriate $85,716 per fiscal year in FYs 22-23 and 23-24, for a total of $171,432, for homeless outreach coordinator contract services as part of the annual budget process. (Community Services, Public Safety, Housing & Development Committee approved 3-0) Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/eClC8ByP5Qo
BACKGROUND
After a long-standing dispute regarding the disposition of funds earmarked for Downtown Revitalization, a settlement agreement was reached and finalized in April 2015, between the City and developers of Centennial Plaza. The settlement involves the distribution of funds derived from the development of a new RiverPark theater complex at The Collection. Settlement funds are intended to offset the potential impact that the theater complex at the Collection might have on Downtown Oxnard. The settlement funds were placed into a City account entitled “Downtown Improvement Program,” and throughout this report, the settlement money will be referred to as Downtown Improvement Program Settlement Funds (DIPSF).
Previously, the City Council authorized expenditures from this fund for lighting improvements, public restrooms pilot program, tree trimming, Downtown Development Code, Parking Management Plan, Arts Hub, and a Downtown Revitalization Manager. The Downtown Improvement Program Settlement Fund balance at the end of Fiscal Year (FY) 2020-2021 was approximately $4,804,484, which includes interest earned to date.
DISCUSSION
In December of 2019, staff presented to the Council a multi-pronged approach to downtown revitalization which included the following elements:
1. Addressing the impact of homelessness and vagrancy;
2. Seeking private economic investment through the development of city and privately-owned properties; 566
3. Creating a clean and safe environment; and
4. Creating a vibrant downtown environment.
Staff made recommendations for use of the Downtown Improvement Program Settlement Fund for a three-year timeframe which focused on creating a physical and safe environment in order to attract private economic investment.
Despite the fact that the global pandemic had an impact on businesses and hampered development, significant progress in achieving these goals was nevertheless made. The intent of this report is to provide an update on the projects that were approved and funded for FY19-20, FY 20-21, and FY 21-22.
APPROVED AND FUNDED PROJECTS AND PROGRAMS FOR FY19-20, FY 20-21, and FY 21-22 Homeless Outreach: $50,000 approved in Fiscal Year 2019-2020 and $100,000 (Annually for Two Years) In September of 2019, the City issued a Request for Proposals from entities interested in providing homeless outreach and case management services. Following a review of the proposals submitted, the Salvation Army was selected and contracted for the provision of these services for the remainder of the Fiscal Year 2019-2020. Due to the onset of the COVID-19 pandemic, the commencement of the Salvation Army’s outreach and case management services was delayed until May of 2020, when two outreach specialists began work in the field.
The Salvation Army Street Outreach team serves some of Oxnard’s most vulnerable residents, including those who are homeless and living unsheltered. On a typical week, the Salvation Army engages with forty new clients citywide, and provides regular ongoing case management to approximately twenty-five people at a time.
Effective July 1, 2020, with the approval of the DIPSF in the FY 20-21 budget, the scope of services was expanded to include an additional component to provide outreach services focused on the downtown area. The Salvation Army hired additional staff dedicated to the downtown service area commencing June 2021. The DIPSFs are only used to pay for staff dedicated to the downtown area.
The City Council originally approved $250,000 to be spent over three fiscal years. Due to COVID-19 and the delay in hiring the team dedicated to the downtown, the $50,000 approved in Downtown Improvement Program Settlement Funds were not spent in Fiscal Year 2019-2020 and only $700 of the $100,000 programmed in Fiscal Year 2020-2021 were spent. In Fiscal Year 2021-2022, the City has incurred a monthly cost of $7,143 for the downtown street outreach team.
Staff anticipate a total cost of $85,716 for the current fiscal year.
The downtown street outreach team has accomplished the following since June 2021:
1. Contacts: 235
2. Shelter: 120 (about half of these are referrals and half are placements into shelter)
3. Salvation Army ARC treatment (rehab): 10
4. Hygiene bags: 180
5. Food bags: 71
6. Transportation: 30
7. DMV vouchers: 21
They have also successfully helped two of the “Top 10” hard to reach clients complete judicial diversion and they are still currently staying in the shelter working on permanent housing plans.
The "Top 10" persons that the Police Department have identified as having a high volume of police interactions and hardest to engage into services. Although two people seems small, this is actually a huge impact for these two people and 567
for the downtown community.
Because of delays caused by COVID-19, staff asks the Committee to recommend to City Council, as part of the FY budget processes, to appropriate $85,716 in DIPSF in FY 22-23 and $85,716 in FY 23-24. This would total $257,848 for street outreach rather than $250,000 originally approved.
Property Management and Maintenance: $260,000 (One Time) Laundromat (318 W. 5th Street) ($195,000)
It is critical that the City invest in nuisance abatement for the most challenging properties owned within the Downtown.
One such location that presents ongoing challenges is the Laundromat building located at 318 West 5th Street. Over the past few years, this building has regularly experienced break-ins and damage that impact the adjacent properties and the overall Downtown area. In addition, these incidents often require responses from Police, Fire, and Facilities, costing the City significant ongoing expenses. City staff have concluded that the best option is to demolish this building. In 2019, staff recommended, and Council approved, funding for the demolition of the building, at an estimated cost of $195,000.
In Fiscal Year 2020-2021, $14,847 was spent on design fees. The City procured a contractor for such a demolition and a contract was awarded in January 2022 at a cost of $174,773 including contingency fees. Demolition is scheduled to begin by March 2022.
As presented to Council Committee in 2019, staff believes that it will be critical that the demolition of this nuisance property not create a new nuisance in the vacant lot left behind. Therefore, the City will explore temporary uses and community activation of the site and surrounding area to ensure the property is an ongoing asset to the Downtown community. City staff presented potential activation ideas to downtown stakeholders and is preparing to issue a Request for Proposals seeking a service provider that can activate the space after the demolition is complete. $250,000 in American Rescue Plan Act funds have been allocated to activate the subject site, as well as the vacant City-owned site on A Street north of 5th Street.
Downtown Parking Structure ($65,000)
The council authorized $65,000 to address safety concerns and support the ongoing efforts to create a clean and safe environment in the Downtown Parking Structure. To address these concerns, staff suggested updating the security camera system and lighting in the structure. Initial camera system upgrades were estimated to cost $65,000. The City engaged Guidepost Solutions to generate a camera system and design for the structure. During that engagement, and working with Facilities and the Oxnard Police Department, staff realized there was an opportunity and need to improve overall security in the facility as well as realize savings and economies of scale in system and infrastructure deployment by addressing emergency call boxes in the structure at the same time. Guidepost also determined that cabling in the facility will need to be replaced.
In October of 2021, staff amended the engagement with Guidepost to include emergency call box system design in the scope of work. The design drawings for the camera system and the emergency call boxes were submitted for review and final specifications. It is anticipated that the cost to implement the upgraded design with the emergency call boxes will be approximately $157,495. A funding source for the remaining costs has not been identified. Therefore, staff propose to carry these funds over to Fiscal Year 2022-2023 to give staff time to identify a funding source and include it in next year’s budget.
Public Safety: $200,000 (Annually for Three Years)
Downtown Targeted Police Deployment ($200,000)
Downtown businesses and residents were becoming increasingly frustrated at the growing number of incidents that were occurring downtown, including burglaries, trespassing, drug use, public urination, and more. Due to budget cuts, the number of police officers assigned to downtown had been reduced from six to two. Business owners were repeatedly hearing from residents that they no longer felt safe going downtown and business owners were forced to spend more money on safety measures while their customers dwindled. The City drafted stronger ordinances to address vagrancy but continued to lack the police presence to enforce these ordinances. 568
It became clear that it would be extremely difficult to attract private investment into the downtown without addressing these public safety issues. The Oxnard Police Department requested funding from the Downtown Improvement Program Settlement Fund in order to allocate additional police hours to this geographical area. This funding allowed police officers to strategically focus their enforcement efforts and address criminal behavior during the busiest times. The Oxnard Police Department's Central Business District deployment has benefited greatly from these funds, which have resulted in forty additional hours per week dedicated to the Downtown area. These deployments are similar to other communities such as Seabridge and Riverpark that fund additional Police personnel for those areas. These funds cover overtime, which also allows for more weekend coverage and a return to alcohol compliance efforts in the evening hours, which the Oxnard Police Department was doing very little of. Overtime funding, rather than additional authorized officer positions, allows for a more direct impact by choosing the busiest hours and days for selective uniformed enforcement.
By providing additional overtime funding at a rate of $200,000 annually limited to service within the Downtown, the Oxnard Police Department has been able to enhance efforts directed towards the mitigation of both downtown vagrancy and quality of life issues, as well as the ability to conduct business compliance checks related to both Alcohol and Beverage Control and tobacco regulations. From December-2020 to September-2021, officers issued over 500 citations related to violations of various city and state ordinances, focusing on repeat offenders. Additionally, officers made 500 arrests in the form of misdemeanor citations for other violations, including narcotic offenses, penal code violations, and traffic matters. While this may have moved some of the problems elsewhere, this has also given the officers an opportunity to become more familiar with the small number of people responsible for the majority of the issues. Officers were able to continue to conduct business compliance checks prior and during COVID-related shutdowns and reductions, focusing on compliance with both Alcohol and Beverage Control regulations and matters related to Public Health Orders.
Staff and Consultants: Additional $30,000 approved in Fiscal Year 2019-2020 and $90,000 annually for two additional years
In Fiscal Year 2017-2018 and Fiscal Year 2018-2019, the Downtown Improvement Program Settlement Fund allocated sufficient funding for a full-time Downtown Revitalization Manager through April 2019. However, in FY 20-21 and FY 21-22 rather than funding one full-time Downtown Revitalization Manager, funding was appropriated to fund a portion of the salaries of the staff that were dedicating a portion of their time to drive Downtown results. Positions that have received partial funding include the Community Development Director, Economic Development Manager, and the Economic Development Administrative Secretary.
In addition, with Council approval, the City contracted with New City America to provide revitalization services. In Fiscal Year 2019-2020 the contract with New City America was $91,000. In Fiscal Years 20-21 and 21-22, $90,000 each year was allocated from the DIPSF for these services.
New City America worked with the Downtown Oxnard Improvement Association (DOIA) to receive its charitable, 501(c)(3) status, selected an interim Board of Directors and officers and created new working committees. The new DOIA Board has expanded from six Board members with the former Oxnard Downtown Management District to over fifteen.
The Downtown Oxnard Improvement Association now has a functioning Marketing Committee and contracted services with the Downtowners. They also created a system of ongoing maintenance and beautification which was previously done in-house. Through New City America's guidance, the support of City Council, and the DOIA Board, DOIA is poised to be highly productive in the coming year due to its realignment of the budget and giving each Committee a working budget to work with.
STRATEGIC PRIORITIES
This agenda item supports the Economic Development strategy. The purpose of the Economic Development strategy is to focus on the retention and expansion of Oxnard businesses by increasing the skills and employability of our local workforce, invite new business investments, and target site-based redevelopment opportunities.
This agenda item supports the Quality of Life strategy. The purpose of the Quality of Life strategy is to restore and increase quality services and programs that enrich Oxnard's diverse community, promote safe neighborhoods, encourage 569
community engagement, and support our residents in their efforts to improve their quality of life.
This agenda item supports Public Safety strategy. The purpose of the Public Safety strategy is to restore and modernize the delivery of public safety services to provide for the safety of our neighborhoods and health of our community.
FINANCIAL IMPACT
The budget over three years totals $1,787,153; whereas the projected expenses over three years total $1,313,859.
In Fiscal Year 2019-2020 (Year 1), a total of $748,474 was appropriated from the Downtown Improvement Program Settlement Fund for the program priorities described in this report. Actual expenses totaled approximately $344,632.
In Fiscal Year 2020-2021 (Year 2), a total of $538,337 was appropriated and expenses totaled approximately $386,738.
In Fiscal Year 2021-2022 (Year 3), a total of $500,342 is appropriated and $582,489 is projected to be spent.
Staff recommends that the Council appropriate $85,716 per fiscal year in FYs 22-23 and 23-24 for a total appropriation of $171,432 for homeless outreach coordinator contract services. If the Council Committee supports this recommendation, the funding would be appropriated as part of the annual budget processes.
The projected Fiscal Year 2021-2022 ending unassigned fund balance of the Downtown Improvement Program Settlement Fund is estimated to be approximately $4.0 million.
COMMITTEE OUTCOME
The Community Services, Public Safety, Housing & Development Committee approved 3-0 on March 8, 2022, to approve the staff recommendation and to forward the item for Council approval.
Prepared by: Emilio Ramirez, Housing Director
ATTACHMENTS
1. Budget Table - Year 1 - 3 sr.docx
2. Downtown Improvement Program Settlement Funds Update PP Presentation 570
EXHIBIT A
Project
BudgetYear 1FY 19-20
Year 1ActualFY 19-20
BudgetYear 2FY 20-21
Year 2ActualFY 20-21
BudgetYear 3FY 21-22
Year 3ProjectedFY 21-22
Total Budget over 3Years
Total ProjectedActual over 3 Years
Economic DevelopmentStaff Costs(annually)
$147,474 $78,138 $148,337 $73,691 $110,342 $32,000
$406,153 $183,829
Homeless Outreach(annually)
$50,000 $0 $100,000 $700 $100,000 $85,716
$250,000 $86,416
Laundromat(one-time)
$195,000 $0 $0 $14,847 $0 $174,773
$195,000 $189,620
Parking Structure(one-time)
$65,000 $0 $0 $0 $0 $0
$65,000 $0
Police Resources(annually)
$200,000 $198,994 $200,000 $200,000 $200,000 $200,000
$600,000 $598,994
Consultant(annually)
$91,000 $67,500 $90,000 $97,500 $90,000 $90,000
$271,000 $255,000
Totals (approx.) $748,474 $344,632 $538,337 $386,738 $500,342 $582,489 $1,787,153 $1,313,859 571
Downtown Improvement Program
Settlement Funds Update
Emilio Ramirez, Director
Housing Department
City Council
March 29, 2022
572
Background 2
1. April 2015 - Settlement agreement reached and finalized between the City and developers of Centennial Plaza
2. Settlement funds placed into a City account titled Downtown Improvement Program Settlement Funds
3. $6.15 million earmarked for Downtown Revitalization
4. Estimated Fiscal Year 2021 - 2022 ending unassigned fund balance will be approximately $4 million
573
Previously Funded Projects
1. Lighting Improvements
2. Public Restrooms Pilot Program
3. Tree Trimming
4. Downtown Development Code
5. Parking Management Plan
6. Arts Hub
7. Downtown Revitalization Manager
3 574
Framework for Funding Recommendations
On December 3, 2019, Council approved projects associated with the following multi-pronged strategy to revitalize downtown 4 WVCBA Photo
Clean & Safe
575
3 Year Budget Appropriations
1. Homeless Outreach: $50,000 in FY 19-20 and $100,000 in FY 20-21 & FY 21-22
2. Property Management and Maintenance $260,000 (one time) a. Laundromat Building Demolition(318 West 5th Street) $195,000 b. Downtown Parking Structure Improvements: $65,000
3. Downtown Targeted Police Deployment $200,000 (annually for three years)
4. Staff and Consultants
a. City Staff: $147,474 (annually for three years)
b. Through the budget process this has been reduced to more closely match anticipated staff costs
c. New City America: $91,000 FY 19-20; $90,000 in FY 20-21 & FY 21-22
5 576
Homeless Outreach
Street outreach worker hired for downtown
1. Salvation Army Partners with local service providers and law enforcement
2. June 2021, Salvation Army hired staff dedicated to downtown service area only
3. $250,000 budget over three years; $86,416 project to be spent over three years
4. Due to COVID impacts and delays, request previously appropriated funds be extended to Fiscal Years 2022 - 2023 and 2023 – 2024
5. Council approved $250,000 over three years. This request is a $7,848 increase from the original approval
6 FY 19-20 FY 20-21 FY 21-22 FY 22-23 FY 23-24 TOTAL
0 $700 $85,716 $85,716 $85,716 $257,848
577
Homeless Outreach
Downtown Street Outreach:
1. Contacts: 235
2. Shelter: 120
3. Salvation Army ARC treatment: 10
4. Hygiene bags: 180
5. Food bags: 71
6. Transportation: 30
7. DMV vouchers: 21
8. Successfully assisted two of our “Top 10” hard to reach clients complete judicial diversion.
7 578
Property Management and Maintenance
Laundromat (318 W. 5th Street) –
1. $195,000 allocated; $189,620 projected to be spent
2. Demolish building
3. 2020 design fees $14,847
4. 2021 awarded cost of $174,773 which includes contingency and funds for engineering, inspections, survey, and project management
5. Total: $189,620
6. Contract awarded - January 2022
7. Construction to begin by March 2022
8. Activate space – ARPA funds allocated
8 579
Property Management and Maintenance
Downtown Parking Structure - $65,000 allocated; no funds spent
1. Camera system & lighting upgrades recommended for $65,000
2. Scope of Work recommended to include call boxes, cabling, system upgrade. Enhanced plans estimated to cost approximately $158,000
3. Project put on hold while additional funds are identified 9 580
Public Safety
Additional Police Deployment Resources
1. $600,000 allocated over three years; $598,994 projected to be spent over three years
2. 40 hours a week dedicated to the Downtown area
3. Overtime funding allows focus on new ordinances and Oxnard Police Department to return to evening alcohol compliance efforts and COVID business compliance
4. 500+ citations issued for various city and state ordinances between December 2020 to September 202
5. 500+ arrests in the form of misdemeanor citations
6. Small business compliance checks during COVID-1
7. Alcohol and Beverage Control compliance
10 581
Staff and Consultants 11
1. In Fiscal Years 2017-2018 2018-2019, funded a full-time Downtown Revitalization Manager.
2. FYs 19-20, 20-21 and 21-22 funding was appropriated to fund a portion of the salaries of the staff that were dedicating a portion of their time to drive Downtown results.
3. $400,6,153 budget for three years; $183,829 projected to be spent on staffing over three years
582
Staff and Consultants Continued 12
$271,000 budget over three years;
$255,000 projected to be spent over 3 years
OUTCOMES:
501(C)(3) status
Interim Board of Directors
Working committees
Board expansion from 6 to 15
Contracted out Maintenance Services
583
Financial Impact City Downtown Improvement Fund
1. Total allocated over three years: $1,787,153
2. Total projected expenses over three years: $1,313,859 a) Total Fiscal Year 2019-2020 actuals - $344,632
b) Total Fiscal Year 2020-2021 actuals - $386,738
c) Projected Fiscal Year 2021-2022 Annual Costs - $582,489 (estimated)
3. Projected Fiscal Year 2021 - 2022 ending fund balance = $4 million
4. Due to COVID-19 impacts, requesting that $85,716 per year (total of $171,432) be appropriated from the DIPSF for street outreach in Fiscal Year 2022 - 2023 and Fiscal Year 2023 - 2024
13 584
Recommendation 14
That the City Council:
1. Receive an update on the implementation of the approved program priorities funded with the Downtown Improvement Program Settlement Funds; and
2. Appropriate $85,716 per fiscal year in FYs 22-23 and 23-24, for a total of $171,432, for homeless outreach coordinator contract services as part of the annual budget process.
585
CITY COUNCIL AGENDA REPORT
REPORTS
AGENDA ITEM NO. K.7
DATE: March 29, 2022
TO: City Council
FROM: Michael Wolfe, Public Works Director, (805) 385-8055, [email protected]
SUBJECT: FY 2021 American Rescue Plan Act Economic Adjustment Assistance Grant Application Resolution (0/5/5)
RECOMMENDATION
That the City Council:
1. Adopt a resolution authorizing the City Manager to submit an application for an amount not to exceed $5,000,000 in FY 2021 American Rescue Plan Act Economic Adjustment Assistance grant funds for needed equipment, improvements and renovations for the Oxnard Performing Arts & Convention Center; and
2. Approve and authorize the City Manager or designee to execute grant agreements; the Chief Financial Officer or designee to submit financial reports and grant claims and approve budget appropriations for the use of the FY 2021 American Rescue Plan Act Economic Adjustment Assistance grant funds if awarded; and the Director of Public Works or designee to submit non-financial reports.
Please click the following link to view the required Measure M pre-recorded presentation video: https://youtu.be/5p7Y- BEtAak
BACKGROUND
The intent of the Economic Development Administration’s (EDA) FY 2021 American Rescue Plan Act Economic Adjustment Assistance grant is to help communities and regions devise and implement long-term economic recovery strategies through a variety of non-construction and construction projects to assist communities and regions impacted by the coronavirus pandemic. This is the last ARPA grant funding available through the EDA and is highly competitive with an estimated 300 projects to be funded ranging from $500K to $5M in scope, for a total of $500,000,000 to be distributed. EDA encourages the submission of applications based on long-term, regionally oriented, coordinated, and collaborative economic development or redevelopment strategies that foster economic growth and resilience.
Sterling Venue Ventures, the Oxnard Performing Arts Center Corporation, Economic Development Collaborative, and City staff have all reviewed the renovation and equipment needs of Oxnard PACC and the merits of this one-time funding opportunity. The proposal aligns with the EDA’s investment priorities of: 1) Equity, 2) Recovery & Resilience and 3) Workforce Development.
DISCUSSION
Opened in 1968, the Oxnard Performing Arts & Convention Center (Oxnard PACC) is a highly utilized facility serving the needs of Western Ventura County, for conventions, concerts, business meetings, special events, and performances and contributes significantly to the region’s creative economy. Data Arts 2020 ranked Ventura County as one of the nation’s top 10 “arts vibrant” mid-sized communities out of 947 metropolitan areas studied, including 2nd in number of 586
artists per capita, and 4th in number of creative businesses. Yet, Ventura County ranks 624th in the amount of government support for the arts. Under non-pandemic operations, annually, Oxnard PACC welcomes over 350K visitors to over 1,500 events.
With the exception of a theater renovation in the 1990’s, Oxnard PACC - particularly the Convention Center - has suffered from deferred maintenance. Priority equipment and renovation needs identified for this grant opportunity include:
1. Theater roof repairs
2. New paving for sidewalks and outdoor stages (ADA accessibility)
3. Repaving of employee/ back parking lot
4. Handicap railing in theater balcony
5. Updated theater lighting
6. New signage
7. Exterior and interior paint
8. New landscaping
9. New tables, chairs
10. New audio and projection systems for ballrooms
11. Refinishing of Ballroom floors
12. ADA compliant bathrooms in Convention Center
13. Air conditioning in Convention Center
14. Kitchen renovations (Ventura Room, Main Kitchen, Auditorium Lobby)
15. Entrance from PACC to Hobson Park East
16. Updates security and networking systems
17. Shading for courtyards
18. Hazardous material removal (e.g. asbestos) if necessary By investing in these identified needs, Oxnard PACC can operate as a competitive, modern, and multifunctional venue and diversify its revenue streams vis-a-vis augmented programming, rental services and workforce development initiatives.
The timeline to submit an application for this grant is March 31, 2022. As such, staff is recommending submitting the application despite having some uncertainties in order to not miss an opportunity to receive this non-traditional funding. These uncertainties include:
1. As of the date of drafting this staff report, Public Works is waiting for the structural report on the Oxnard PACC theater. After review of this final report, a determination if any or all of the proposed improvements are feasible will need to be made.
2. Public Works already has a number of priority CIP projects underway. Many of those projects have funding deadlines and/or project specific timelines to necessitate future required CIP projects. The exact project-delivery timeframe and/or funding program year for the EDA funds is not certain and needs further clarification by EDA.
If an expedited project timeline is required by EDA for the PACC improvements, a prioritization decision will need to be made or additional staffing in Engineering will be required.
3. The grant recommends a 20% match. Sterling Venue Ventures has agreed to serve as this match as the OPAC nonprofit works to identify additional funding sources.
In consideration of the above uncertainties, it should be noted that if any of these should result in a project impact, the application may be withdrawn, or if awarded the grant, funds may need to be returned to the granting authority.
STRATEGIC PRIORITIES
This agenda item supports the Quality of Life strategy. The purpose of the Quality of Life strategy is to restore and increase quality services and programs that enrich Oxnard's diverse community, promotes safe neighborhoods, encourages community engagement, and supports our residents in their efforts to improve their quality of life. 587
This agenda item supports Economic Development strategy. The purpose of Economic Development strategy is to focus on the retention and expansion of Oxnard businesses by increasing the skills and employability of our local workforce, invite new business investments, and target site-based redevelopment opportunities.
FINANCIAL IMPACT
At the time of report writing, the cost for basic equipment and renovations for Oxnard PACC is estimated to be $5,000,000. The grant would cover 80% of the costs and suggests a 20% match, which Sterling Venue Ventures has committed to provide while the OPAC nonprofit seeks additional sources of funding. There is no City match required for this grant. Ongoing maintenance funding would need to be considered in Fiscal Year 2027-28 after construction is finalized and if the grant is awarded. Annual operations and maintenance cost increases are yet to be determined and will be directly related to the funding amount received and improvements made.
COMMITTEE OUTCOME
This item did not originate in Committee.
Prepared by: Eric Humel, Grants Specialist
ATTACHMENTS
1. OPAC - City Resolution
2. OPAC Grant Match Commitment Letter
3. EDA Tourism Grant
4. Presentation
588
CITY COUNCIL OF THE CITY OF
OXNARD RESOLUTION NO. _____
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
OXNARD APPROVING THE SUBMITTAL OF A GRANT APPLICATION FOR FY 2021
AMERICAN RESCUE PLAN ACT ECONOMIC ADJUSTMENT ASSISTANCE GRANT FUNDS
WHEREAS, City Council Resolution No.12,053 sets out the procedure by which City staff may submit grant applications, following approval by resolution of the City Council; and WHEREAS, the Public Works Department has requested that City Council approve the submittal of an application to the Economic Development Administration for an amount not to exceed $5,000,000 for FY 2021 American Rescue Plan Act Economic Adjustment Assistance grant funds to be used for needed equipment, improvements and renovations for the Oxnard Performing Arts & Convention Center.
NOW, THEREFORE, the City Council of the City of Oxnard resolves to approve the submittal of a grant application by the City Manager to the Economic Development Administration for the purpose of obtaining grant funding for the Oxnard Performing Arts & Convention Center equipment and renovations. The City Council further resolves that the City Manager or designee is authorized to execute grant agreements; the Finance Director or designee is authorized to submit financial reports and grant claims and approve special budget appropriations for the use of grant funds; and the Director of Public Works or his or her designee is authorized to submit non-financial reports.
PASSED AND ADOPTED THIS 31st Day of March, 2022, by the following vote:
AYES:
NOES:
ABSTAIN:
ABSENT:
______________________________
John C. Zaragoza, Mayor
ATTEST: APPROVED AS TO FORM:
___________________________ ______________________________ Rose Chaparro, City Clerk Stephen M. Fischer, City Attorney 589
590
A sustainable leader,
Oxnard Performing Arts
Center Corporation is at
the center of Oxnard's
artistic, educational, and
economic life, inviting
residents to discover,
create, and connect
through engagement
with the arts and each
other.
HONORARY BOARD
Anderson .Paak
Jose Cano
Cola Boyy
Don Lombardi
Carmen Ramirez
BOARD OF DIRECTORS
Gary Blum
Chairperson
Carol Flores-Beck
Vice-Chairperson
Vincent Stewart
Secretary
Leonard Shulman
Treasurer
Gary Davis
Michael Doty
Irma Lopez
Doranda Martin
Marie Villa
EXECUTIVE DIRECTOR
Carolyn Merino Mullin
800 Hobson Way
Oxnard, CA 93030
(805) 385-8147
OxnardPerformingArts.com
@OxnardPerformingArts
@OxnardPACC
@OxnardPACC
ARPA Competitive Tourism Grant
Oxnard Performing Arts & Convention Center
(Oxnard PACC)
Invest in new equipment, fixtures, and lacking basic amenities such as A/C, Renovate outdated existing spaces for more utility and COVID health and safety, Grow creative job sector through Center employment, indirect jobs (concert promoters, event planners, musicians) and career training for youth and young adults. [Phase 2] Build new studio space/s (digital content production, audio engineering/recording) for job training and workforce development, and [Phase 2] Create connectivity with the adjacent park through open-air event space (new construction) for outdoor recreation and entertainment opportunities.
To renovate and expand the Oxnard Performing Arts & Convention Center, a mid-century modern complex with significant deferred maintenance since its 1968 debut. The Center serves as one of the main tourism anchors for the City of Oxnard, a hub for community and creative placemaking and a nexus for the creative workforce dev't. The project would:
1. 2.
3. 4.
5. PROJECT OVERVIEW
BACKGROUND
Location: 1 hr north of L.A., Oxnard PACC is the only anchor of its scale in Western Ventura County (VC), located in the underserved city of Oxnard, CA. Occupies 2 city blocks in a low-income neighborhood in downtown Oxnard
Facility: Built in 1968 by the community, the City-owned Center has a 1,604-seat theater, 2 ballrooms, 5 classrooms, Youth Center, a network of 4 outdoor courtyards, 2 parking lots (500 spaces) and adjoins an 11-acre park
Demographics: Oxnard is an agricultural/urban community of 210K residents (74% Latinx, 85% BIPOC) and home to 20K+ Mixteco & Purepecha indigenous farmworkers.
The Center is used by VC residents at large (846K, 45% BIPOC) and visitors.
Patrons: 350K visitors annually to 1,500+ events and is utilized by 200+ orgs for meetings, trade shows, workshops, conventions, performances, weddings, concerts, etc.
Ticket sales reflect visitorship from 35+ states annually.
Arts Vibrancy: Data Arts 2020 ranks VC as one of the nation’s top 10 “arts vibrant” mid-sized communities out of 947 metropolitan areas studied, including 2nd in # of artists per capita, and 4th in # of creative businesses. Yet, VC ranks 624th in the amount of local gov’t support for the arts. A 2018 VC Community Foundation report found that creative industries contributed $4.9B to VC’s economy (3.8% of VC’s GDP), supported 24,318 jobs in in/direct employment, and now exceeds the value of agriculture production in the region. While the 2020 CARES Act distributed $75M in direct relief to the arts, VC received only .0002% of those dollars. The NEA expedited distribution of the 2020 CARES Act money by sending $40M directly to its grantees, but VC had no grantees and thus did not receive any of those funds.
Vaccine Outreach Anderson .Paak Dia de Muertos
591
“This working-class, super-majority Latino city remains the brown-skinned stepchild of a county where the split between wealthy suburbs and agricultural towns is straight outta the 1950s. So it’s little surprise the coronavirus has dispropor- tionately ravaged Oxnard: The city represents 25% of the County’s population but 40% of its COVID cases and 37% of its deaths.”
- Gustavo Arellano, LA Times Columnist, Feb. 2021
VC jobs created by travel spending = 13,560
Direct Travel Spending in VC ↓ $1.826M (2019) to $917M (2020) Tax receipts generated by travel spending (which funds civic services) ↓ 84M to 35M in 2020.
The city represents 25% of the County’s population but 40% of its COVID cases and 37% of its deaths.
A “Safe City” for immigrants, Oxnard is a hub of industrial agriculture, attracting immigrant communities to work in its fields, the very frontline workers who kept Americans fed during this pandemic.
Oxnard PACC was the 1st VC Covid testing site activated, hosted emergency food + PPE distributions and blood drives, helped with Census and Covid Vaccine outreach, and serves as a Red Cross site during disasters.
Over 80% of Oxnard’s student body receives free or reduced lunch. The dropout rate is 34%, 9% of students are English Learners and 30% of VC children are overweight/obese.
Many of our frontline workers/families are rent burdened, lack affordable housing and live in crowded environments, oftentimes with multiple families living in a single apartment, as is the case in our immediate neighborhood. By activating the adjacent park, which has been plagued by drugs, crime and homelessness, we can provide safe, outdoor recreation for residents and visitors, improve community health, and help revitalize downtown.
TOURISM:
COVID:
RECREATION:
PROJECT OVERVIEW
A COMMUNITY SEVERELY AND DISPROPORTIONATELY IMPACTED BY COVID HISTORICAL CHALLENGES; A ONCE-IN-A-LIFETIME OPPORTUNITY As an underserved community of color, the City of Oxnard has struggled to maintain financial sustainability and has significantly deferred maintenance of Oxnard PACC, with the exception of a theater renovation in the 90s. Severe budget cuts in 2019 nearly closed Oxnard PACC (Oxnard's Carnegie Art Museum did not survive the cuts and remains closed.) 55 staff were laid off. The Center underwent a restructuring, from a city-nonprofit operating model to a nonprofit-private model with a new concert company, that went into effect March 2020; Covid shuttered the theater 2 weeks later. Ticket sales are off by 60%.
Communities of color have to advocate harder and louder to keep arts and culture alive and struggle to find the donor bases other nonprofits/communities in our County have. The City is on its way to financial recovery and stability through new tax increases and stimulus funding, but still has a ways to go before investing in the arts, even more so for the millions needed to repair, renovate and expand Oxnard PACC. A seismic study in Nov. ‘21 shows that the building is structurally sound.
EDA support would help make Oxnard PACC a first class, competitive regional venue that not only drives tourism dollars vis-a-vis events and entertainment, but would enable us to become a nexus for creative jobs through state-of-the-art studios and real world training, experience and mentorship through the theater (i.e.- sound engineering, lighting design, production, streaming, etc). In CA, jobs and the economy: $174.6B Creative Sector, $93.3B Construction, $54B Ag; thus good paying jobs in arts is not only possible, but lucrative. With our mild Mediterranean climate, activating the park is a year-round initiative that expands our programming footprint and increases our revenue streams in a safe, healthy manner. The project would help rehire staff previously laid off, provide employment for local carpenters and construction workers.
592
TEEN ART PROGRAM
Ventura Ballroom, 400 capacity.Needs new curtains, sound system, modernized commercialkitchen.
Carolyn Merino Mullin, Executive Director
Office: 805-385-8147 | Cell: 530-520-5397
[email protected] | www.oxnardperformingarts.com City of Oxnard, OPAC, Economic Development Collaborative, RRM Design Group, Carpenters Union Local 805, LIUNA 585
CONFIRMED PROJECT STAKEHOLDERS
A VIEW OF OXNARD PACC
Cracked concrete stages in the courtyards and throughoutthe sidewalks make the Center unsafe and affectaccessibility and usability.
Exterior of the mid-century modern, 1604-seat theaterNeeds new paint, landscaping, signage, enhanced lighting. Inside the theater which needs an updated fly railsystem, renovated backstage areas, handicap railing, etc.
Two Ballrooms (1,400 capacity) need air-conditioning (afirst!), ADA-compliant restrooms, refinished floors,updated lighting, sound, and curtains, and a modern look.
Where Oxnard PACC meets Hobson Park East. Betterconnectivity between the two and outdoor performancespace would help with park activation and safety.
The commercial kitchen, catering kitchen and foodservice area in the theater all need modernization andcould run culinary workforce development programs. 593
FY 2021 American Rescue Plan Act
Economic Adjustment Assistance Grant
Application Resolution
City Council
March 29, 2022
Eric Humel, Grants Coordinator, City of Oxnard
Carolyn Mullin, Executive Director, OPAC
594
That the City Council:
1. Adopt a resolution authorizing the City Manager to submit an application for an amount not to exceed $5,000,000 in FY 2021 American Rescue Plan Act Economic Adjustment
Assistance grant funds for needed equipment,
improvements and renovations for the Oxnard Performing
Arts & Convention Center; and
2. Approve and authorize the City Manager or designee to execute grant agreements; the Chief Financial Officer or designee to submit financial reports and grant claims and approve budget appropriations for the use of the FY 2021 American Rescue Plan Act Economic Adjustment
Assistance grant funds if awarded; and the Director of
Public Works or designee to submit non-financial reports.
RECOMMENDATION 2
595
● Highly competitive, this is the last of EDA’s ARPA funding. ● The grant help communities impacted by COVID devise & implement long-term economic recovery strategies through non-construction and construction projects.
● Funds 300 projects ranging from $500K to $5M in scope, for a total of $500M to be distributed.
● Sterling Venue Ventures, OPAC nonprofit, Economic Dev't Collaborative, and City staff have all reviewed the
renovation and equipment needs of Oxnard PACC and the
merits of this one-time funding opportunity.
BACKGROUND 3
596
● Under non-pandemic operations, annually, Oxnard PACC
welcomes over 350K visitors to over 1,500 events
(concerts, business mtgs, special events, etc).
● The Center is a highly utilized facility and contributes significantly to the region’s creative economy.
● The County is
○ one of the nation’s top 10 “arts vibrant” mid-sized
communities out of 947
○ 2nd in # of artists per capita and 4th in # of creative businesses.
○ ranks 624th in the amount of government support for
the arts.
DISCUSSION 4
597
Priority equipment and renovation needs identified for this grant include:
1. Theater roof repairs
2. ADA sidewalks and outdoor stages
3. Repaving back parking lot
4. Handicap railing in theater
5. Updated theater lighting
6. New signage
7. Exterior and interior paint
8. New landscaping
9. New tables, chairs
10.New audio and projection (CC)
DISCUSSION 5
11. Refinishing floors
(CC)
12. ADA bathroom (CC)
13. Air conditioning (CC)
14. Kitchen renovations
15. PACC to Park Entrance
16. Security/ networking
systems
17. Shading for courtyards
18. Hazardous material
removal (if necessary)
CC= Community Center
598
Cracked concrete on outdoor stages, outdated furniture, and floors in need of refinishing are some of the issues affecting the Center’s aesthetics, functionality, user experience, and profitability.
6 599
Windstorm damage to Oxnard PACC theater roof.
7 600
Oxnard PACC and Hobson Park East could mutually benefit from better connectivity and a shared entrance.
8 601
● Grant is due 3/31/22. Staff recommends submitting despite uncertainties:
○ Pending structural report for PACC theater. After report review, a determination if any/ all proposed improvements are feasible will need to be made.
○ Public Works has a number of priority CIP projects w/ funding deadlines and/or project timelines.
○ EDA project/funding timeframe needs further clarification. If requiring expediting, a prioritization decision or additional Engineering staffing may be required.
● Grant recommends a 20% match. SVV will serve as a match as the OPAC nonprofit works to identify add'l funding.
● If any of the above results in a project impact, the application may be withdrawn, or if awarded the grant, funds may need to be returned to the EDA.
DISCUSSION 9
602
• At the time of report writing, the cost for basic equipment and renovations for Oxnard PACC is estimated to be
$5,000,000
• The grant would cover 80% of the costs and suggests a 20% match, which Sterling Venue Ventures has committed
to while the OPAC nonprofit seeks additional sources of funding
• There is no City match required for this grant
• Ongoing maintenance funding would need to be
considered in Fiscal Year 2027/28 after construction is finalized and if the grant is awarded.
FINANCIAL IMPACT 10
603
QUESTIONS
11 604