RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
City of San Clemente
910 Calle Negocio
San Clemente, CA 92673
Attn: City Clerk
NO FEE REQUIRED PER GOVT CODE SECTION 27383
(Space above for Recorder’s use only)
APN: 060-031-44
AFFORDABLE HOUSING REGULATORY AGREEMENT AND
DECLARATION OF RESTRICTIVE COVENANTS
(City of San Clemente)
This Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants (the “Agreement”) dated for reference purposes as of ________, 2024, is executed by and between the City of San Clemente, a municipal corporation (“City”) and Friendship Shelter, Inc., a California nonprofit public benefit corporation (the “Owner”).
RECITALS
Owner owns fee title to the land described in Exhibit A attached hereto and incorporated herein by this reference (the “Property”).
The Property is located in the Affordable Housing (“AH”) Overlay District in the City of San Clemente in Orange County, California.
Owner desires to develop the Property for the purpose of rehabilitating and operating a qualified affordable residential rental housing development, and more specifically, long-term supportive housing for individuals experiencing literal homelessness or at risk of homelessness, thereon (the “Project”).
Affordable housing projects are a permitted use in the AH Overlay if the requirements of San Clemente Municipal Code (“SCMC”) section 17.56.090 are met.
SCMC section 17.56.090.F requires every qualified affordable housing project within the City’s AH Overlay have a legally binding agreement between the applicant and the City executed and recorded against the property on which the qualified affordable housing project is to be constructed prior to issuance of building permits to ensure that the requirements of SCMC Chapter 17.56 are satisfied, which agreement shall be binding on all future owners and successors in interest.
The purpose of this Agreement is to satisfy the requirements of SCMC section 17.56.090.F and to regulate and restrict the occupancy, rents, operation and management of the Property and the Project for affordable housing and related uses. The Parties intend the covenants set forth in this Agreement to run with the land and to be binding upon Owner and Owner’s successors and assigns in the Project and the Property for the full term of this Agreement.
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Owner and the City hereby agree as follows:
1. Definitions. The following terms have the meanings set forth in this Section wherever used in this Agreement or attached exhibits. “Actual Household Size” means the actual number of persons in the applicable household. “Adjusted for Family Size Appropriate for the Unit” shall be determined consistent with Section 50052.5(h) of the California Health and Safety Code, subject to the application of federal rules and regulations applicable to Project financing sources, including Section 42(g)(2) of the Internal Revenue Code of 1986 as amended (or successor provision) if applicable to the Project. “Affordable Rent” means a monthly rent less a utility allowance and other fees and charges required to be paid by tenants of the Project on a non-optional basis: (i) for units that are restricted for rental to households with incomes of not more than thirty percent (30%) of AMI (“30% Units”), a monthly rent that does not exceed one-twelfth of thirty percent (30%) of thirty percent (30%) of Area Median Income, Adjusted for Family Size Appropriate for the Unit, (ii) for units that are restricted for rental to households with incomes of not more than fifty percent (50%) of AMI (“50% Units”), a monthly rent that does not exceed one-twelfth of thirty percent (30%) of fifty percent (50%) of Area Median Income, Adjusted for Family Size Appropriate for the Unit, and (iii) for units that are restricted for rental to households with incomes of not more than eighty percent (80%) of AMI (“80% Units”), a monthly rent that does not exceed one-twelfth of thirty percent (30%) of eighty percent (80%) of Area Median Income, Adjusted for Family Size Appropriate for the Unit. “Applicable Requirements” means all applicable California, federal, and City laws, ordinances, statutes, rules, regulations and program requirements, including, but not limited to those of TCAC and HUD. “Area Median Income” or “AMI” means the median income for Orange County, California, as determined by HUD pursuant to Section 8 of the United States Housing Act of 1937 and as published from time to time by the State of California Department of Housing and Community Development (“HCD”) in Section 6932 of Title 25 of the California Code of Regulations or successor provision. “City” means the City of San Clemente, California.
“Effective Date” means the date that this Agreement is recorded in the Official Records. “Emergency Shelter” shall have the same meaning as set forth in SCMC section 17.56.100(F)(1). “Extremely Low Income Household” means a household whose household Gross Income at initial occupancy does not exceed thirty percent (30%) of the Area Median Income Adjusted for Actual Household Size. “Gross Income” means the total anticipated annual income of all persons in a household calculated using the methods set forth in TCAC regulations, or if TCAC regulations do not address such matter, the total anticipated annual income of all persons in a household as defined in 24 CFR 5.609. “HUD” means the U.S. Department of Housing and Urban Development. “Indemnitees” is defined in Section 7.
“Improvements” means renovations to the interior of the building, including the addition of kitchenettes, re-configuration of manager’s unit to create an additional tenant unit and office space, and cosmetic upgrades such as flooring, paint and window coverings. “Long-term” means a period of thirty (30) or more consecutive calendar days of occupancy pursuant to a written agreement. “Low Income Household” means a household whose household Gross Income at initial occupancy does not exceed eighty percent (80%) of the Area Median Income Adjusted for Actual Household Size. “Official Records” means the Official Records of the Orange County Clerk-Recorder. “Owner” means Friendship Shelter, Inc., a California nonprofit public benefit corporation and its successors and assigns. “Project” is defined in Recital C.
“Property” is defined in Recital A
“Qualifying Household” means a household experiencing literal homelessness, or at-risk of homelessness, with an active tenant-based housing Voucher, as the term “Voucher” is defined herein, or that qualifies as an Extremely Low Income Household, a Very Low Income Household or a Low Income Household. “TCAC” means the California Tax Credit Allocation Committee. “Term” is defined in Section 4.
“Very Low Income Household” means a household whose household Gross Income at initial occupancy does not exceed fifty percent (50%) of the Area Median Income Adjusted for Actual Household Size. “Voucher” means tenant-based rental/housing assistance provided through a public housing authority, based on the determination of the housing authority that the individual or family qualifies under an applicable County-provided program’s eligibility category, which must include household income thresholds that meet, or are more restrictive than, those contained in the definitions of Extremely Low Income Household, Very Low Income Household, or Low Income Household, as those terms are defined herein. Upon termination of available housing authority voucher programs, this definition shall include State of California voucher programs that contain similar criteria to the public housing authority voucher programs, as described in this definition.
2. Compliance with Requirements and Regulations. Owner shall comply with all Applicable Requirements and all applicable California, federal, and City laws, ordinances, statutes, rules, regulations and program requirements, with the exception of development standards allowed to deviate from City ordinances due to application of waivers or concessions requested and approved pursuant to State Housing Laws, which include, the request to increase density of the development to 11 units, with one manager’s unit, and reduce the required setbacks of the development to two (2) feet from the front property line and three (3) feet from the rear property line, as approved by the City Council through the adoption of Resolution No. ______ on __________, 2024.
3. Use and Affordability Restrictions. Owner agrees that, at all times during the Term of this Agreement, the Property will be used solely for the operation of a multifamily rental housing development in compliance with the Applicable Requirements and this Agreement. Throughout the Term, a minimum of eleven (11) residential units in the Project shall be occupied, or if vacant, available for occupancy, by Qualifying Households at Affordable Rents. Throughout the Term, pursuant to SCMC section 17.56.090(C)(1), a minimum of fifty-one percent (51%) of the housing units in the Project shall be reserved for households earning no greater than fifty percent (50%) of Orange County Median Income by household size. Throughout the Term, Owner agrees that operating an Emergency Shelter on the Property is prohibited. Notwithstanding any contrary provision of this Agreement, if other Project lenders, Project investors, or regulatory agencies require stricter household income eligibility or affordability requirements than those imposed hereby, the stricter requirements pertaining to rent limitations, income limits, and occupancy requirements applicable shall prevail during such time that such requirements apply to the Project. The occupancy of each unit in the Project shall not exceed two persons.
4. Term of Agreement. The Term of this Agreement will commence on the Effective Date and shall continue in effect until the thirtieth (30th) anniversary of the date that rehabilitation of the Project is completed as evidenced by the City Building Inspector’s sign off following the final inspection of the Improvements. If such date cannot be ascertained, the Term shall end on the thirty-second (32nd) anniversary of the Effective Date.
5. Tenant Selection. Owner shall adopt written tenant selection policies that: (a) are reasonably related to program eligibility and the applicant’s ability to perform the obligations of the lease; (b) are consistent with the purpose of providing housing for Qualifying Households; and (c) provide for prompt written notification to any rejected applicant of the grounds for rejection. To the extent permitted by Applicable law, Owner shall give a preference in the rental of the residential units restricted under this Agreement to applicants who are 1) confirmed to have resided in San Clemente for the previous twelve (12) months and 2) residing in South Orange County.
6. Long-term Supportive Housing For Individuals Experiencing Homelessness. Owner has elected to operate the Project as long-term supportive housing for individuals experiencing homelessness (or at risk of homelessness) who are holding a housing Voucher. Given this criteria and the current methods used to grant Vouchers as a part of homelessness response, Owner anticipates that many tenants will have disabling conditions. And as such, to the extent applicable, the Project will be operated at all times in accordance with (a) the Unruh Act, including without limitation California Civil Code Sections 51.2, 51.3, and 51.4; (b) the federal Fair Housing Act, 42 U.S.C. Section 3607(b) and 24 CFR 100.304; (c) the California Fair Employment and Housing Act, Government Code Section 12900 et seq., and (d) all other applicable laws and regulations. Owner shall develop and implement appropriate verification procedures to ensure compliance with this Section 6, and shall provide City with a copy of such verification procedures. Owner shall enter into a written agreement with Qualifying Households that provides for a tenancy or occupancy of a minimum of thirty (30) consecutive calendar days and that does not limit the maximum tenancy or occupancy to a period of six (6) months or fewer.
7. Indemnification. To the greatest extent permitted by law, Owner shall indemnify, defend (with counsel approved by City) and hold the City and its elected and appointed officers, officials, employees, agents, consultants, contractors and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding, penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising from or related to the Project, any Project approval (including but not limited to any environmental determination), this Agreement, or Owner’s or Owner’s employees’, agents’, contractors’, subcontractors’ or volunteers’ failure to comply with applicable legal requirements or this Agreement. This indemnity obligation shall not extend to any Claims arising solely from the gross negligence or willful acts of the Indemnitees. The indemnity provisions of this paragraph shall apply whether or not any insurance policies have been determined to be applicable to any such Claims, and shall survive the expiration or other termination of this Agreement.
8. Fair Housing; Nondiscrimination. Owner shall comply with all applicable fair housing and civil rights requirements with respect to the marketing, rental, and operation of the Project, including the obligations to affirmatively further fair housing and adhere to the site selection and neighborhood standards set forth in 24 CFR §§ 1.4(b)(3) and 941.202, as applicable. Owner shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, the Project, or any portion thereof, on the basis of race, color, religion, creed, sex, sexual orientation, gender identity, disability, marital status, ancestry, or national origin of any person. Owner covenants for itself and all persons claiming under or through it, and this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955, and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property or part thereof, nor shall Owner or any person claiming under or through Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in, of, or for the Property or part thereof. Owner shall include such provision in all deeds, leases, contracts and other instruments executed by Owner, and shall enforce the same diligently and in good faith. Owner shall include a statement in all advertisements, notices and signs for the availability of units for rent to the effect that Owner is an Equal Housing Opportunity Provider.
9. Federal Accessibility Requirements. Owner shall comply with all applicable federal accessibility requirements under the Fair Housing Act and the implementing regulations at 24 CFR Part 100, Section 504 of the Rehabilitation Act of 1973 and the implementing regulations at 24 CFR Part 8, and Titles II and III of the Americans with Disabilities Act and the implementing regulations at 28 CFR Parts 35 and 36, respectively.
10. Income Certification. Owner or Owner’s authorized agent shall obtain from each household prior to initial occupancy of each restricted unit, and on every anniversary thereafter, a written certificate containing all of the following in such format and with such supporting documentation as City may require:
(a) The identity of each household member; and
(b) The total household gross income.
Owner shall retain such certificates for not less than five (5) years, and upon City’s request, shall provide copies of such certificates to City and make the originals available for City inspection.
11. Rental Charges. Total charges for rent, utilities and related services for each unit in the Project shall not exceed the Affordable Rent for the unit. If upon recertification, a tenant’s income exceeds the Qualifying Household limit for the applicable unit type, Owner may increase the rent for such tenants to no more than 30% of the tenant’s monthly income less utility and other mandatory charges.
12. Parking. The parking requirements for the Project includes 12 standard parking spaces and 1 accessible space, for a total of 13 parking spaces.
13. Management Responsibilities. Owner is responsible for all management functions with respect to the Project, including, without limitation, the selection of tenants, certification and recertification of household size and income, evictions, collection of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and security. Property management shall also monitor the use of parking spaces within the development to assure that the parking spaces are provided, maintained and used in accordance with the terms of this Agreement. The City shall have no responsibility over management of the Property or the Project.
14. Review of Management Policies and Marketing Plan and Resident Services Plan. If not previously provided, not later than ninety (90) days following commencement of rehabilitation of the Improvements, Owner shall submit for City review and approval, a plan for marketing and managing the Property (“Marketing and Management Plan”). The Marketing and Management Plan shall address in detail how Owner plans to market the Project to prospective Qualified Households in accordance with fair housing laws and this Agreement, Owner’s tenant selection criteria, how Owner plans to certify the eligibility of Qualifying Households, and the social services to be provided to residents of the Project. The Plan shall also describe the management team and shall address how Owner and the management entity plan to manage and maintain the Property and the Project, and shall identify the social services provider. The Plan shall include the proposed management agreement, social services agreement, and the form of rental agreement that Owner proposes to enter into with Project tenants. The Plan shall also address how Owner and the management entity will monitor the use of parking spaces within the Project to assure that the parking spaces are provided, maintained and used in accordance with the terms of this Agreement. Owner shall abide by the terms of the Marketing and Management Plan in marketing, managing, and maintaining the Property and the Project, and throughout the term of this Agreement, shall submit proposed modifications to City for review and approval, such approval not to be unreasonably withheld, conditioned or delayed.
15. Repair, Maintenance and Security. Throughout the term of this Agreement, Owner shall at its own expense, maintain the Property and the Project in good physical condition, in good repair, and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with all applicable state, federal, and local laws, ordinances, codes, and regulations. Without limiting the foregoing, Owner agrees to maintain the Project and the Property (including without limitation, the residential units, common areas, meeting rooms, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair, abandoned vehicles/appliances/bicycles, and illegal activity, and shall take all reasonable steps to prevent the same from occurring on the Property or at the Project. Owner shall prevent and/or rectify any physical deterioration of the Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property and the improvements located thereon in good condition and repair. Owner shall provide adequate security measures for the Project, including without limitation, the installation of adequate lighting and deadbolt locks.
16. City’s Right to Perform Maintenance. In the event that Owner breaches any of the covenants contained in Section 15, and such default continues for a period of ten (10) days after written notice from City (with respect to graffiti, debris, and waste material) or thirty (30) days after written notice from City (with respect to landscaping, building improvements and general maintenance), then City, in addition to any other remedy it may have under this Agreement or at law or in equity, shall have the right, but not the obligation, to enter upon the Property and perform all acts and work necessary to protect, maintain, and preserve the improvements and the landscaped areas on the Property. All costs expended by City in connection with the foregoing, shall constitute an indebtedness secured by the Deed of Trust, and Owner shall pay such sums to City upon demand. All such sums remaining unpaid thirty (30) days following delivery of City’s invoice therefor will bear interest at the lesser of 10% per annum or the highest rate permitted by applicable law.
17. Fees, Taxes, and Other Levies. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens and levies applicable to the Property or the Project, including without limitation possessory interest taxes, if applicable, imposed by any public entity, and shall pay such charges prior to delinquency. Owner shall not be required to pay any such charge so long as (a) Owner is contesting such charge in good faith and by appropriate proceedings, (b) Owner maintains reserves adequate to pay any contested liabilities, and (c) on final determination of the proceeding or contest, Owner immediately pays or discharges any decision or judgment rendered against it, together with all costs, charges and interest. The foregoing is not intended to impair Owner’s ability to apply for any applicable exemption from property taxes or other assessments and fees.
18. Insurance Coverage. Throughout the Term, Owner shall comply with the insurance requirements set forth in Exhibit B to this Agreement, which is incorporated fully herein by this reference, and shall, at Owner’s expense, maintain in full force and effect insurance coverage as specified in Exhibit B.
19. Inspection and Records. Owner shall maintain records that clearly document Owner's performance of its obligations to operate the Property and the Project in accordance with this Agreement. Owner shall submit any records to the City within ten (10) business days of the City's request. Owner shall permit the City to enter and inspect the Property and the Project for compliance with obligations under this Agreement upon seventy-two (72) hours advance notice delivered to Owner or Owner's management agent and to the tenants of any residential units that will be inspected.
20. Annual Report. By not later than April 30 of each year, Owner shall submit to the City a report for the preceding calendar year showing the information necessary to allow the City to determine Owner's compliance with this Agreement, and within thirty (30) days after receipt of a written request, Owner shall provide any other information or completed forms requested by the City in order to comply with the reporting requirements of the City. Without limiting the generality of the foregoing, the annual report submitted by Owner pursuant to this Section shall at a minimum, include the following information for each dwelling unit in the Project: (i) unit number; (ii) number of bedrooms; (iii) current rent and other charges; (iv) dates of any vacancies during the previous year; (v) number of people residing in the unit; (vi) total household income of the residents in each unit; (vii) documentation of source of household income; (viii) lease commencement and termination dates, (ix) initial move-in date, and (x) the identity of each household member and the age of each household member or other basis upon which each household member qualifies for occupancy in permanent supportive housing.
21. Monitoring Fee. Following completion of construction of the Project, as evidenced by City’s issuance of a final certificate of occupancy or equivalent, Owner shall be obligated to pay to City an annual fee (the “Affordable Housing Monitoring Fee”) in the amount of $80 per restricted unit. The Affordable Housing Monitoring Fee is payable annually on the same date that the Annual Report is due pursuant to Section 19 above. City shall have the right to file a lien against the Project if the Affordable Housing Monitoring Fee is not paid when due and remains unpaid thirty (30) days following the date that City provides written notice of the delinquency. The Affordable Housing Monitoring Fee will increase annually by three percent (3%) over the prior year.
22. Recordation; No Subordination. This Agreement shall be recorded in the Official Records of Orange County against the Property. Owner hereby represents, warrants and covenants that with the exception of easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, deed of trust, or other interest in the Property or the Project. If at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to this Agreement, upon the request of City, Owner hereby covenants and agrees to promptly undertake all action necessary to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 22, and to provide such evidence thereof as City may request.
23. Default and Remedies; Lender Cure Rights. In the event of any breach of any agreement or obligation under this Agreement by Owner, the City shall provide written notice to Owner and Lender of such breach. Owner and Lender shall have an opportunity to cure such breach within thirty (30) days from Owner's and Lender’s receipt of such written notice or such longer period of time as the City determines is necessary to cure the breach if Owner or Lender diligently undertakes to cure such breach. If Owner fails to complete a timely cure of the specified breach, the City may proceed with any remedy provided under the City Documents or allowed by law or in equity to enforce the terms of this Agreement. A cure by the Lender shall be accepted or rejected on the same basis as if made or tendered by Owner. City shall provide a copy of any notice of default hereunder to the Lender, if any, or to such other address provided to the City in writing, concurrently with the provision of such notice to Owner.
24. Effectiveness Succeeds Conveyance of Property and Repayment of Loans. This Agreement will remain effective and fully binding for the full term hereof regardless of (i) any sale, assignment, transfer, or conveyance of the Project or the Property, or any part thereof or interest therein, (ii) any payment, prepayment or extinguishment of the Loan or the Note, if any, or (iii) any reconveyance of the Deed of Trust, if any.
25. Binding Upon Successors; Covenants to Run with the Land. Owner hereby subjects its interest in the Property and the Project to the covenants and restrictions set forth in this Agreement. The City and Owner hereby declare their express intent that the covenants and restrictions set forth herein shall be deemed covenants running with the land and shall be binding upon and inure to the benefit of the heirs, administrators, executors, successors in interest, transferees, and assigns of Owner and City, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest therein. Any successor-in-interest to Owner, including without limitation any purchaser, transferee or lessee of the Property or the Project (other than the tenants of the individual dwelling units within the Project) shall be subject to all of the duties and obligations imposed hereby for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties and obligations set forth herein, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument. Owner agrees for itself and for its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City.
26. Reconveyance. Upon the termination of this Agreement, the Parties agree to execute and record appropriate instruments to release and discharge this Agreement; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to the termination of this Agreement upon the expiration of the term.
27. Miscellaneous.
27.1 Amendments. This Agreement may be amended or modified only by a written instrument signed by both Parties and recorded in the Official Records of Orange County.
27.2 Governing Law; Venue. This Agreement shall be interpreted under and be governed by the laws of the State of California, except for those provisions relating to choice of law and those provisions preempted by federal law. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of Orange County, California. Owner waives any rights that it may have under California Code of Civil Procedure §394.
27.3 Attorneys' Fees and Costs. In the event that any legal or administrative action is commenced to interpret or to enforce the terms of this Agreement, the prevailing party in any such action shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action.
27.4 Consents and Approvals. Any consent or approval of the City required under this Agreement may be provided by the City Manager of the City or his or her designee unless the City Manager determines that the matter requires approval by the City Council.
27.5 Notices. Notices delivered pursuant to this Agreement shall be delivered by registered or certified mail, postage prepaid, return receipt requested, or delivered personally, to the principal offices of Owner and the City as follows:
CITY:
OWNER:
City of San Clemente
910 Calle Negocio
San Clemente, CA 92673
Attn: City Manager
Friendship Shelter, Inc.
24361 El Toro Road, Suite 215
Laguna Woods, CA 92637
Attn: Chief Executive Officer
27.6 Relationship of the Parties. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or principal and agent with one another. The relationship of Owner and City shall not be construed as a joint venture, equity venture, partnership or any other relationship. City neither undertakes nor assumes any responsibility or duty to Owner (except as expressly provided in this Agreement) or to any third party with respect to the Project. Owner shall have no authority to act as an agent of City or to bind City to any obligation.
27.7 No Third Party Beneficiaries. There are no third party beneficiaries under this Agreement.
27.8 Assignment of Enforcement Rights. The City may, but is not required to, assign any or all of its enforcement rights under this Agreement.
27.9 Waiver. Any waiver by the City of any obligation in this Agreement must be in writing. No waiver will be implied from any delay or failure by the City to take action on any breach or default of Owner or to pursue any remedy allowed under this Agreement, the City Documents, or applicable law. Any extension of time granted to Owner to perform any obligation under this Agreement shall not operate as a waiver or release from any of its obligations under this Agreement. Consent by the City to any act or omission by Owner shall not be construed to be consent to any other or subsequent act or omission or to waive the requirement for the City's written consent to future waivers.
27.10 Further Assurances. The Parties shall execute, acknowledge and deliver to the other such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement.
27.11 Severability. Every provision of this Agreement is intended to be severable. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired.
27.12 Headings; Construction; Statutory References. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language of this Agreement shall be construed as a whole according to its fair meaning and not strictly for or against any Party. All references in this Agreement to particular statutes, regulations, ordinances or resolutions of the United States, the State of California, or the City of San Clemente shall be deemed to include the same statute, regulation, ordinance or resolution as hereafter amended or renumbered, or if repealed, to such other provisions as may thereafter govern the same subject.
27.13 Entire Agreement; Exhibits. This Agreement, together with the other City Documents contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto.
27.14 Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be an original and all of which together shall constitute one agreement.
27.15 Signatories. Each signatory and Party hereto hereby warrants and represents to the other Party that it has legal authority and capacity and direction from its principal to enter into this Agreement, and that all resolutions or other actions have been taken so as to enable it to enter into this Agreement.
SIGNATURES ON FOLLOWING PAGE.
IN WITNESS WHEREOF, City and Owner have caused this Affordable Housing Regulatory Agreement and Declaration of Restrictive Covenants to be executed by their duly authorized representatives as of the date first written above.
CITY:
CITY OF SAN CLEMENTE, a municipal corporation
By: __________________________________
Andy Hall, City Manager
Approved as to form:
_____________________________________
Elizabeth A. Mitchell, City Attorney
Attest:
_____________________________________
City Clerk
OWNER:
Friendship Shelter, Inc., a California limited partnership By: __________________________________
Dawn Price, CEO
By: __________________________________
Tom Salinger, Secretary
SIGNATURES MUST BE NOTARIZED.
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 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_____________________________
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 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_____________________________
Exhibit A
LEGAL DESCRIPTION
The property address is 2435 South El Camino, San Clemente, CA, located in Orange County, CA.
APN#060-031-44
LOTS 188, 189 AND 190 OF TRACT NO. 938, IN THE COUNTY OF ORANGE, STATE OF CALIFORNIA, AS SHOWN ON A MAP THEREOF RECORDED IN BOOK 29 PAGES 22-25 INCLUSIVE OF MISCELLANEOUS MAPS, IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY.
Exhibit B
INSURANCE REQUIREMENTS
Throughout the term of this Agreement, Owner shall obtain and maintain the following policies of insurance and shall comply with all provisions set forth in this Exhibit. (a) Commercial General Liability. Owner (and until issuance of the final certificate of occupancy or equivalent for the Project, all contractors and subcontractors working on behalf of Owner on the Project) shall keep in full force and effect a commercial general liability policy including coverage for bodily injury, property damage, products, completed operations and contractual liability coverage with coverage limits in an amount equal to the greater of: (a) the amounts required by the construction and permanent lenders for the Project, or (b) Two Million Dollars ($2,000,000) each occurrence, Four Million Dollars ($4,000,000) annual aggregate, together with Ten Million Dollars ($10,000,000) excess liability coverage or such other policy limits as City may require in its reasonable discretion; provided however, the coverage requirements for subcontractors shall be Two Million Dollars ($2,000,000) per occurrence, Four Million Dollars ($4,000,000) annual aggregate. Defense costs shall be paid in addition to the limits. Such policy or policies shall be written on an occurrence basis that affords coverage at least as broad as Insurance Services Office "occurrence" form CG 0001 and shall name the Indemnitees as additional insureds. The coverage requirements set forth in this paragraph shall apply to any Owner Controlled Insurance Program (“OCIP”) used by Owner, and shall apply to any exclusions from any such OCIP (e.g., for off-site fabrication). The policy shall contain no endorsements or provisions (1) limiting coverage for contractual liability; (2) excluding coverage for claims or suits by one insured against another (cross-liability); or (3) containing any other exclusion(s) contrary to the terms or purposes of this Agreement. (b) Automobile. Owner (and until issuance of the final certificate of occupancy or equivalent for the Project, all contractors and subcontractors working on behalf of Owner on the Project) shall maintain a comprehensive automobile liability coverage in the amount of Two Million Dollars ($2,000,000), combined single limit including coverage for owned, hired, and non-owned vehicles with coverage at least as broad as Insurance Services Office Form CA 0001 covering "Any Auto" (Symbol 1), or the exact equivalent. Automobile liability policies shall name the Indemnitees as additional insureds. (c) Worker’s Compensation; Employer’s Liability. Owner shall furnish to City evidence satisfactory to City that Owner (if it has any employees) and any contractor or subcontractor with whom Owner or the general contractor has contracted for the performance of work on the Property or otherwise pursuant to this Agreement, carries statutory Workers’ Compensation insurance and Employer’s Liability insurance in a minimum amount of One Million Dollars ($1,000,000) per accident. (d) Builder’s Risk. Upon commencement of construction work and continuing until issuance of the final certificate of occupancy or equivalent for the Project, Owner and all contractors working on behalf of Owner shall maintain a policy of builder's all-risk insurance in an amount not less than the full insurable cost of the Project on a replacement cost basis with a lender’s loss payable endorsement for the benefit of City. (e) Professional Liability/Errors and Omissions. Owner shall require the Project architect, engineer, and general contractor to maintain Professional Liability/Errors and Omissions (“E&O”) insurance with limits not less than Two Million Dollars ($2,000,000) each claim. The City’s Risk Manager may approve lower limits for professionals that will provide a limited scope of services for the Project. Certificates evidencing this coverage must reference both the Owner and the Indemnitees. Covered professional services shall specifically include all work to be performed under the Agreement and delete any exclusions that may potentially affect the work to be performed (for example, any exclusions relating to lead, asbestos, pollution, testing, underground storage tanks, laboratory analysis, soil work, etc.). If the professional liability/errors and omissions insurance is written on a claims made form: (i) the retroactive date must be shown and must be before the Effective Date, (ii) insurance must be maintained and evidence of insurance must be provided for at least three (3) years after completion of Project construction, and (iii) if coverage is cancelled or non-renewed and not replaced with another claims made policy form with a retroactive date prior to the Effective Date, Owner must purchase, or require the provision of, extended period coverage for a minimum of three (3) years after completion of construction. (f) Pollution Legal Liability. Owner shall require the general contractor to carry pollution liability insurance to provide third-party coverage for bodily injury, property damage, cleanup, and related defense costs, with limits not less than One Million ($1,000,000) per occurrence or claim and Two Million ($2,000,000) policy aggregate. If the policy provides coverage on a claims-made basis, the retroactive date must be shown and must be before the Effective Date. (g) Property. Owner shall maintain property insurance covering all risks of loss (including earthquake and flood (if required)) for 100% of the replacement value of the Project with deductible, if any, in an amount acceptable to City, with a lender’s loss payable endorsement for the benefit of City. (h) Insurance Providers. Companies writing the insurance required hereunder shall be licensed to do business in the State of California. Insurance shall be placed with insurers with a current A.M. Best's rating of no less than A:VII. (i) Evidence of Insurance; Endorsements; Policies. Prior to the Effective Date of this Agreement, Owner shall furnish City with certificates of insurance in form acceptable to City evidencing the required insurance coverage required under paragraphs (a) through (f) above, duly executed endorsements evidencing the Indemnitees status as lender’s loss payable / additional insured (except for E&O and Workers’ Compensation policies), and all other endorsements and coverage required hereunder pertaining to such coverage. Prior to City’s issuance of a final certificate of occupancy or equivalent for the Project, Owner shall furnish City with certificates of insurance in form acceptable to City evidencing the insurance coverage required under paragraph (g) above with a duly executed endorsement evidencing City’s status as lender’s loss payable.
All insurance certificates shall contain a statement of obligation on the part of the carrier to notify City of any material adverse change, cancellation, termination or non-renewal of the coverage at least thirty (30) days in advance of the effective date of any such material adverse change, cancellation, termination or non-renewal. Upon City’s request, Owner shall, within thirty (30) days of the request, provide or arrange for the insurer to provide to City, complete certified copies of all insurance policies required under this Agreement. City’s failure to make such request shall not constitute a waiver of the right to require delivery of the policies in the future. (j) Additional Insured Endorsements. The additional insured endorsements for the general liability coverage shall use Insurance Services Office (ISO) Form No. CG 20 09 11 85 or CG 20 10 11 85, or equivalent, including (if used together) CG 2010 10 01 and CG 2037 10 01; but shall not use the following forms: CG 20 10 10 93 or 03 94. (k) Reinstatement. If any insurance policy or coverage required hereunder is canceled or reduced, Owner shall, within five (5) days after receipt of notice of such cancellation or reduction in coverage, but in no event later than the effective date of cancellation or reduction, file with City a certificate showing that the required insurance has been reinstated or provided through another insurance company or companies. Upon failure to so file such certificate, City may, without further notice and at its option, procure such insurance coverage at Owner’s expense, and Owner shall promptly reimburse City for such expense upon receipt of billing from City. Owner shall require all persons and entities that are required to provide professional liability/E&O coverage pursuant to paragraph (e) above to use best efforts to reinstate the required coverage limits in the event coverage under such policies is reduced. (l) Primary Coverage; Waiver of Subrogation; Annual Aggregate Limits. All coverage shall be primary insurance and shall not be contributing with any insurance, or self-insurance maintained by City, and the policies shall so provide. Each insurance policy shall contain a waiver of subrogation for the benefit of the City. Owner agrees to waive subrogation rights for commercial general liability, automobile liability, and worker’s compensation against Indemnitees regardless of the applicability of insurance proceeds, and agrees to require all contractors and subcontractors to do likewise. With the exception of E&O policies, if any of the required insurance is provided under a form of coverage that includes an annual aggregate limit or provides that claims investigation or legal defense costs are included in such annual aggregate limit, such annual aggregate limit shall be three times the applicable occurrence limits specified above. (m) Deductibles/Retentions. Any deductibles or self-insured retentions shall be declared to, and shall be subject to approval by the City’s Risk Manager. At the option of and upon request by the City’s Risk Manager if the Risk Manager determines that such deductibles or retentions are unreasonably high, either the insurer shall reduce or eliminate such deductibles or self-insurance retentions as respects the Indemnitees or Owner shall procure a bond guaranteeing payment of losses and related investigations, claims administration and defense expenses. (n) Adjustments. The limits of the liability coverage and, if necessary, the terms and conditions of insurance, shall be reasonably adjusted from time to time (not less than every five (5) years after the Effective Date nor more than once in every three (3) year period following completion of Project construction) to address changes in circumstances, including, but not limited to, changes in inflation and the litigation climate in California, provided that such adjustments are consistent with generally prevailing requirements for residential multi-family developments similar to the Project and located in the Orange County area. Within thirty (30) days following City’s delivery of written notice of any such adjustments, Owner shall provide City with amended or new insurance certificates and endorsements evidencing compliance with such adjustments. (o) Additional Insured Coverage; Liability Limits. For all liability insurance required by this Agreement, except E&O and Workers’ Compensation policies, Owner (and Owner’s contractors, as applicable) shall obtain endorsements that name the Indemnitees as additional insured in the full amount of all applicable policies, notwithstanding any lesser minimum limits specified in this Agreement. This Agreement requires Owner (and Owner’s contractors) to obtain and provide for the benefit of the Indemnitees, additional insured coverage in the same amount of insurance carried by Owner (or Owner’s contractors, as applicable), but in no event less than the minimum amounts specified in this Agreement. In the event that Owner (or Owner’s contractors as applicable) obtains insurance policies that provide liability coverage in excess of the amounts specified in this Agreement, the actual limits provided by such policies shall be deemed to be the amounts required under this Agreement. Without limiting the foregoing, the limits of liability coverage specified in this Agreement are not intended, nor shall they operate, to limit City’s ability to recover amounts in excess of the minimum amounts specified in this Agreement. 1 6
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Affordable Housing Regulatory Agreement 13
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EXHIBIT A