Building Horizons/Afford Housing 981998/99 AFFORDABLE HOUSING AGREEMENT
BY AND BETWEEN
LA QUINTA REDEVELOPMENT AGENCY,
AND
BUILDING HORIZONS,
CONT.BDH
AGENCY
DEVELOPER
ORIGINAL
,gz
I.
II.
II
Table of Contents
[100]
SUBJECT OF AGREEMENT ........................................ 1
A.
[ 101 ]
Purpose of Agreement ........................................ 1
B.
[102]
The Redevelopment Plan ...................................... 1
C.
[103]
The Site...................................................I
D.
[104]
Parties to the Agreement ...................................... 2
1.
[105] The Agency .................. ......................2
2.
[106] The Developer........................................2
3.
[107] Prohibition Against Change in Ownership, Management and
Control of Developer and Prohibition Against Transfer
of the Site............................................2
E.
[108]
Representations by the Developer ............................... 3
[200]
AGENCY ASSISTANCE ........................................... 4
A.
[201 ]
Acquisition and Construction Financing .......................... 4
B.
[202]
Conditions Precedent to the Funding of Acquisition Financing ........ 4
C.
[203]
Home Buyer Loan and Second Trust Deed ........................ 5
D.
[204]
Acquisition of the Site ........................................ 5
E.
[205]
Escrow....................................................6
F.
[206]
Conveyance to Eligible Persons and Families ...................... 7
[300]
DEVELOPMENT OF THE SITE ...................................... 7
A.
[301]
Development of the Site .......................................
7
1.
[302] Scope of Development ..................................
7
2.
[303] Site Plan .............................................
8
3.
[304] Review and Approval of Plans, Drawings, and Related Documents
8
4.
[305] Cost of Development ...................................
9
5.
[306] Construction Schedule ..................................
9
6.
[307] Indemnity, Bodily Injury and Property Damage Insurance ......
9
7.
[308] City and Other Governmental Agency Permits ..............
10
8.
[309] Rights of Access .....................................
10
9.
[310] Local, State and Federal Laws ...........................
10
10.
[311 ] Anti -Discrimination ...................................
10
11.
[312] Taxes and Assessments ................................
11
B.
[313]
Prohibition Against Transfer of the Site, the Buildings or Structures
Thereon and Assignment of Agreement ....... :.................
11
C.
[314]
Right of the Agency to Satisfy Other Liens on the Site(s) After Title
Passes....................................................11
D.
[315]
Certificate of Completion ....................................
11
CONT.BDH
IV. [400]
USE
OF THE SITE ...............................................
12
A.
[401 ]
Affordable Housing .........................................
12
B.
[402]
Uses In Accordance with Redevelopment Plan; Nondiscrimination ....
19
C.
[403]
Effect of Violation of the Terms and Provisions of this Agreement After
Completion of Construction ...................................
20
D.
[404]
Maintenance of the Site ......................................
21
V. [500]
DEFAULTS AND REMEDIES ......................................
21
A.
[501 ]
Defaults -- General ..........................................
21
B.
[502]
Legal Actions .................................... .........21
1.
[503] Institution of Legal Actions .............................
21
2.
[504] Applicable Law ......................................
22
3.
[505] Acceptance of Service of Process ........................
22
C.
[506]
Rights and Remedies Are Cumulative ...........................
22
D.
[507]
Inaction Not a Waiver of Default ...............................
22
E.
[508]
Remedies and Rights of Termination ...........................
22
1.
[509] Damages............................................22
2.
[510] Specific Performance ..................................
23
3.
[511 ] Right of Termination by the Developer ....................
23
4.
[512] Termination by the Agency .............................
23
F.
[513]
Remedies of the Parties for Default After Closing of the Acquisition
Escrow...................................................24
1.
[514] Termination and Damages ...............................
24
VI. [600]
GENERAL PROVISIONS ..........................................
24
A
[601 ]
Notices, Demands and Communications Between Parties ...........
24
B. -
[602]
Conflicts of Interest .........................................
24
C.
[603]
Enforced Delay; Extension of Times of Performance ...............
24
D.
[604]
Non -Liability of Officials and Employees of the Agency and the
Developer.................................................25
E.
[605]
Entire Agreement, Waivers ...................................
25
VII. [700] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY
.....................................................................26
CONT.BDH
Attachment No. 1
Attachment No. 2
Attachment No. 3
Attachment No. 4
Attachment No. 5
Attachment No. 6
Attachment No. 7
Attachment No. 8
Attachment No. 9
Attachment No. 10
Attachment No. 11
CONT.BDH
ATTACHMENTS
Scope of Development
Schedule of Performance
Developer Promissory Note
Developer Deed of Trust
Declaration of Conditions, Covenants and Restrictions
Certificate of Completion
Maximum Sales Price Example
Certificate of Proposed Transferee
Notice of Intent to Transfer
Request for Approval of Proposed Transferee
Assumption Agreement
AFFORDABLE HOUSING AGREEMENT
This Affordable Housing Agreement ("Agreement") is entered into by and between LA
QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic (the "Agency") and
BUILDING HORIZONS, a California nonprofit public benefit corporation (the "Developer"). The
Agency and the Developer (collectively referred to as the "Parties") hereby agree as follows:
I. [100] SUBJECT OF AGREEMENT
A. [ 101 ] Purpose of Agreement
The purpose of this Agreement is to effectuate the Redevelopment Plan (as hereinafter
defined) for the La Quinta Redevelopment Project (the "Project") by providing for the improvement
of certain property situated within the Project Area of the Project (the "Project Area"), by assisting
in the financing of the acquisition and development of two parcels (the "Site") situated within the
Project Area, including the completion of a single-family home on each parcel and the long-term
maintenance of such housing at an affordable housing cost for persons and households of low and
moderate -income, all as more fully described in this Agreement. The Agency financial assistance
in this Agreement shall be utilized to effectuate a portion of the Agency's overall affordable housing
program pursuant to the requirements of California Health and Safety Code Section 33334.2 to
expend twenty percent (20%) of its increment funds to improve, increase and preserve the
community's supply of low- and moderate housing. The acquisition and development of the Site and
the occupancy of the units as developed by households of limited incomes all as provided in this
Agreement are in the vital and best interests of the City of La Quinta (the "City") and the health,
safety and welfare of its residents, and in accord with the public purposes and provisions of
applicable state and local laws and requirements under which the Project has been undertaken.
B. [102] The Redevelopment Plan
The Redevelopment Plan for Project Area No. 1 (the "Redevelopment Plan") was
approved and adopted by Ordinance No. 43 of the City Council of the City of La Quinta on
November 29, 1983 and amended by Ordinance No. 258 on December 20, 1994 and Ordinance No.
264 on March 7, 1995; said ordinance as amended and the Amended Redevelopment Plan are
incorporated herein by reference.
C. [103] The Site
The "Site" shall consist of two parcels of real property within the Project Area in the
City of La Quinta, County of Riverside. The Site shall be acquired by the Developer. A maximum
of two (2) detached, single-family homes will be developed on the Site (one on each parcel) in
accordance with the "Scope of Development" and by the times set forth in the "Schedule of
Performance," which are attached hereto as Attachment Nos. 1 and 2, respectively, and incorporated
herein by reference.
CONT.BDH
Any material change, as reasonably determined by the Agency, in the Scope of
Development (Attachment No. 1) or in the approved site plan which affects the size, quality, or type
of development proposed for one or more of the parcels shall require the written approval of the
Agency, which approval may be contingent upon the review and renegotiation of all of the economic
and financial terms of this Agreement and such other matters as the Agency shall deem appropriate.
D. [104] Parties to the Agreement
[105] The Agencv
The Agency is a public body, corporate and politic, exercising governmental
functions and powers and organized and existing under Chapter 2 of the Community Redevelopment.
Law of the State of California, Division 24 of the California Health and Safety Code, the principal
office of the Agency is located at 78-495 Calle Tampico, La Quinta, California 92253, or such other
address as Agency shall hereafter designate in writing to Developer.
"Agency", as used in this Agreement, includes the La Quinta Redevelopment
Agency and any and all assignees of or successors to its rights, powers and responsibilities.
2. [ 106] The Developer
The Developer, Building Horizons, is a California nonprofit public benefit
corporation. The principal office and mailing addresses of the Developer for purposes of this
Agreement is P.O. Drawer 10320, Indio, California 92202.
By executing this Agreement, each person signing on behalf of the Developer
warrants and represents to the Agency that the Developer has the full power and authority to enter
into this Agreement, that all authorizations required to make this Agreement binding upon the
Developer have been obtained, and that the person or persons executing this Agreement on behalf
of the Developer are fully authorized to do so.
Whenever the term "Developer" is used in this Agreement, such term shall
include any and all nominees, assignees, or successors in interests as herein provided.
[107] Prohibition Against Change in Ownership. Management and Control
of Developer and Prohibition Against Transfer of the Site
The qualifications and identity of the Developer are of particular interest to
the Agency. It is because of these qualifications and identity that the Agency has entered into this
Agreement with the Developer. Consequently, no person, whether a voluntary or involuntary
successor of Developer shall acquire any rights or powers under this Agreement nor shall the
Developer assign all or any part of this Agreement or the Site without the prior written approval of
CONT.BDH 2
the Agency. A voluntary or involuntary sale or transfer of any interest in the Developer of the Site
prior to the issuance of a Certificate of Completion for the Improvements with respect to such Site
shall be deemed to constitute an assignment or transfer for the purposes of this Section 107, and the
written approval of the Agency shall be required prior to effecting such an assignment or transfer.
Any purported transfer, voluntarily or by operation of law, except with the prior written consent of
the Agency, shall render this Agreement absolutely null and void and shall confer no rights
whatsoever upon any purported assignee or transferee. Prior to the issuance of a Certificate of
Completion for the Improvements, the Developer shall not, except as permitted by this Agreement,
assign or attempt to assign this Agreement or any rights or duties herein, nor make any total or partial
sale, transfer, conveyance, or assignment of the whole or any part of the Site or the Developer
Improvements thereon, without the prior written approval of the Agency.
Notwithstanding any other provision of this Agreement to the contrary,
Agency approval of an assignment or this Agreement or transfer of the Site or any interest therein
shall not be required in connection with the conveyance or dedication of any portion of the Site to
the City of La Quinta or other appropriate governmental agency, including public utilities, where the
granting of such easements permits or facilitates the development of the Site.
This Section 107 shall become inapplicable for each Site as to which the
Agency has issued a Certificate of Completion pursuant to Section 316 of this Agreement.
E. [108] Representations by the Developer
The Developer represents and warrants to the Agency as follows:
1. The Developer is duly established and in good standing under the laws of the
State of Cafifornia and has duly authorized, executed and delivered this Agreement and any and all
other agreements and documents required to be executed and delivered by the Developer in order
to carry out, give effect to, and consummate the transactions contemplated by this Agreement. This
Agreement is enforceable against the Developer in accordance with its terms.
2. The Developer does not have any contingent obligations or contractual
agreements which could adversely affect the ability of the Developer to carry out its obligations
hereunder.
3. There are no pending or, so far as is known to the Developer, threatened, legal
proceedings to which the Developer is or may be made a party or to which it or any of its property
is or may become subject, which have not been fully disclosed in the material submitted to the
Agency, which could adversely affect the ability of the Developer to carry out its obligations
hereunder.
4. There is no action or proceeding pending or, to the Developer's best
knowledge, threatened, looking toward the dissolution or liquidation of the Developer and there is
no action or proceeding pending or, to the Developer's best knowledge, threatened by or against the
Developer which could affect the validity and enforceability of the terms of this Agreement, or
adversely affect the ability of the Developer to carry out its obligations hereunder.
CONT.BDH 3
5. The Developer has, and will as required by its obligations hereunder, dedicate,
allocate and otherwise make available, sufficient financial and other resources to perform its
obligations under this Agreement.
Each of the foregoing items 1 to 5, inclusive, shall be deemed to be an ongoing
representation and warranty and shall survive the close of escrow for the Site(s). The Developer
shall advise the Agency in writing if there is any change pertaining to any matters set forth or
referenced in the foregoing items 1 to 5, inclusive.
II. [200] AGENCY ASSISTANCE
The "Agency Assistance" shall be comprised of two components: .(I) acquisition and
construction financing, and (2) second trust deed assistance for the low or moderate income buyer.
A. [201 ] Acquisition and Construction Financing
(I) Agency shall provide financing in a total amount not to exceed of Two
Hundred and Ten Thousand Dollars ($210,000) for the acquisition of both parcels of the Site and
the complete construction of both housing units by Developer pursuant to the terms of the Scope of
Development (Attachment No. 1), the Schedule of Performance (Attachment No. 2) and the
Developer Promissory Notes and Developer Deed of Trusts (Attachments Nos. 3 and 4, attached
hereto and incorporated herein by this reference);
(ii) Each parcel shall have a separate Developer Promissory Note and Developer
Deed of Trust;
(iii) Agency Funds for each Developer Promissory Note in an amount not to
exceed $105,000 for each of the housing units shall be dispersed directly to escrow for the
acquisition costs portion and the remaining amount shall be disbursed according to a combination
of a construction schedule and invoice documentation to be approved by the Agency Executive
Director;
(iii) The Developer Promissory Note for each property of the Site shall bear no
interest and shall be due and payable upon the sale of the corresponding lot to an Eligible Person or
Family as defined in Section 401.
B. [202] Conditions Precedent to the Fundingof Acquisition Financing
Prior to and as conditions to funding any portion of the Developer Promissory Note,
the Developer shall complete each of the following by the respective times established therefor in
the Schedule of Performance (Attachment No. 2):
1. the Developer shall not be in default of this Agreement;
2. the Developer provides to the Executive Director insurance certificates
conforming to Section 308 of this Agreement;
CONT.BDH 4
3. the Developer shall have executed and deposited with escrow for delivery to
the Agency the Developer Promissory Note for each lot (Attachment No. 3);
4. the Developer shall have executed and deposited with escrow for recordation
and delivery to the Agency the Declaration of Conditions, Covenants and
Restrictions concerning the use of and maintenance of the Site for each lot
(Attachment No. 5) and the Developer Deed of Trust for each lot; and
The foregoing items numbered 1 to 5, inclusive, together constitute the "Conditions
Precedent to the Agency funding of the acquisition portion of the Developer Promissory Note."
C. [203] Home Buyer Loan and Second Trust Deed
Home Buyer Assistance funds shall be in the form of a promissory note ("Buyer
Promissory Note") secured by a second trust deed ("Buyer Second Trust Deed") to assure the
affordability of the housing unit to low and moderate income buyers as defined in Section 401
hereof. The amount of second trust deed funds available shall be determined at the time of
qualifying the proposed low or moderate income buyer of the unit. The final amount shall be
approved by the Executive Director in compliance with the Agency Board's goals and policies for
its affordable housing program.
The basic form of the Buyer Promissory Note and the Buyer Second Trust Deed shall
be that form currently approved for use by the Agency for its affordable housing program at the time
of the sale of the units to the buyers. The form may need revision at a staff level to be current with
Fannie Mae, HUD or other government or lender requirements. Basic terms of the Buyer Promissory
Note shall include: (I) zero percent interest; (ii) 30-year term; (iii) no payments due unless sale to
a nonqualified buyer triggers payment under equity share provision; (iv) assumability to a qualified
buyer, and (v) full credit of all payments at end of term if all conditions, covenants and restrictions
have been followed.
The Agency Assistance has been funded from the Agency's Low and Moderate
Income Housing Fund. Accordingly, Developer acknowledges and agrees that the use of the Site
shall be subject to all of the income and affordability restrictions set forth in this Agreement, and the
Declaration of Covenants, Conditions and Restrictions (Attachment No. 5).
D. [204] Acquisition of the Site
The Developer will acquire a fee simple marketable interest to the Site. The cost of
the Developer to acquire each parcel, including consideration payable to owners, relocation benefits
or assistance, escrow charges, premiums for title insurance and other closing costs, appraisal fees,
preliminary title reports, reasonable attorneys fees, and other related charges shall be approved in
advance by the Executive Director and included in the site cost calculation as allowable costs to be
advanced under the Developer Promissory Note dispersement schedule as approved by the Executive
Director.
CONT.BDH 5
E. [205] Escrow
The Developer agrees to open an escrow or escrows (the "Acquisition Escrow(s)")
with Dixie Escrow Co., or with another mutually agreeable escrow company (the "Escrow Agent"),
by the time established therefor in the Schedule of Performance (Attachment No. 2). This
Agreement constitutes the lenders escrow instructions for the financing of the Site acquisition and
a duplicate original of this Agreement shall be delivered to the Escrow Agent upon the opening of
the Acquisition Escrow. The Escrow Agent is hereby empowered to act under this Agreement, and
the Escrow Agent, upon indicating within five (5) days after the opening of the Acquisition Escrow
its acceptance of the provisions of this Section 205, in writing, delivered to the Agency and the
Developer, shall carry out its duties as Escrow Agent hereunder.
The Agency shall pay into the Acquisition Escrow the total amount of the purchase
price for each lot in the Site and the following fees, charges and costs for each lot promptly after the
Escrow Agent has notified the Agency of the total amount of such purchase price, fees, charges and
costs, but not earlier than ten (10) days prior to the scheduled date for closing the Acquisition
Escrow:
The Escrow fee; and
2. Cost of drawing the grant deed;
3. Recording fees;
4. Notary fees;
The title insurance policy; and
6. Any transfer tax and any state, county or city documentary stamps.
The Escrow Officer shall notify the Agency when all outstanding documents
including the grant deed to the Developer, the Developer Trust Deed and the Declaration of
Conditions Covenants and Restrictions have executed and submitted to Escrow by the applicable
party. The Agency shall provide the funds pursuant to the Developer Promissory Note directly to
Escrow within three (3) business days of the notice by Escrow that all other contingencies to the
closing have been met and the above documents are ready to record.
The Escrow Agent is authorized to utilize the Agency funds provided pursuant to the
Developer's Promissory Note for the above acquisition costs on the condition of the immediate
recording of the Developer's Deed of Trust (Attachment No. 4) and the Conditions, Covenants and
Restrictions (Attachment No. 5) after recording of the grant deed vesting title in the Developer's
name.
CONT.BDH 6
All funds received in this Acquisition Escrow shall be deposited by the Escrow
Agent, with other escrow funds of the Escrow Agent in an interest -earning general escrow account
or accounts with any state or national bank doing business in the State of California. Such funds
may be transferred to any other general escrow account or accounts. All disbursements shall be
made by check of the Escrow Agent.
If this Acquisition Escrow has not closed within three working days of the receipt by
Escrow of the Agency funds then said funds shall be returned to the Agency unless written
authorization to retain the funds is provided by the Agency Executive Director.
Any amendment to these lender's escrow instructions shall be in writing and signed
by the Agency. At the time of any amendment, the Escrow Agent shall agree to carry out its duties
as Escrow Agent under such amendment.
The liability of the Escrow Agent in the capacity of escrow holder with respect to the
Agency is limited to performance of the obligations imposed under it under this Section 205 of this
Agreement.
F. [206] Conveyance to Eligible Persons and Families
At such time as the Developer conveys each parcel of the Site to Eligible Persons and
Families, it shall assure that the Conditions, Covenants and Restrictions (Attachment No. 5) remain
of second seniority to the lien of any financing, and that the Second Deed of Trust is recorded in a
second lien position, behind the lien securing purchase money financing. The conveyances of lots
shall be accomplished by grant deed which sets forth the affordability and nondiscrimination
provisions in the form to be approved by the Agency Executive Director and Agency Counsel prior
to transfer of property to Eligible Person or Family.
II. [300] DEVELOPMENT OF THE SITE
A. [301] Development of the Site
1. [302] Scope of Development
Each parcel of the Site shall be developed as a detached, single-family housing
unit as provided in the Scope of Development (Attachment No. 1). The development of the Site
shall include both public improvements and private improvements on the Site and public
improvements off -site required in the normal course of City review by the City associated with the
development of the Site (collectively, the "Improvements").
Upon close of the Acquisition Escrow, the Developer shall commence and
complete construction of the Improvements for each individual lot of the Site by the respective times
established therefor in the Schedule of Performance (Attachment No. 2).
CONT.BDH 7
The Scope of Development (Attachment No. 1) shall include any plans and
specifications submitted to the City and/or Agency for approval, and shall incorporate or show
compliance with all mitigation measures.
2. [303] Site Plan
By the time set forth therefor in the Schedule of Performance (Attachment No.
2), the Developer shall prepare and submit to the City for its approval a Site Plan and related
documents which conform to requirements of the City and which contain the overall plan for
development of the Site in sufficient detail to enable the City to evaluate the proposal for conformity
to the requirements of the La Quinta Municipal Code and this Agreement. The Site shall be
developed as established in this Agreement and such documents, except as changes may be mutually
agreed upon between the Developer and the Agency. Any such changes shall be within the
limitations of the Scope of Development (Attachment No. 1).
The landscaping and finish grading plans shall be prepared by a professional
landscape architect or registered civil engineer who may be the same firm as the Developer's
architect or civil engineer.
During the preparation of all drawings and plans, staff of the City and the
Agency and the Developer shall hold regular progress meetings to coordinate the preparation of,
submission to, and review of drawings, plans and related documents by the City. The staff of City
and the Agency and the Developer shall communicate and consult informally as frequently as is
necessary to insure that the formal submittal of any documents to the Agency can receive prompt and
speeding consideration.
3. [304] Review and Approval of Plans. Drawings, and Related Documents
The Agency and the City shall have the right of planning, including plan
check, review of all plans and submissions, including any changes therein.
During each stage of the processing of plans for the Improvements, the
Agency and the City shall have the right to require additional information and shall advise the
Developer if any submittal of plans or drawings is not complete or not in accordance with
City/Agency procedures. If the Agency or the City determines that such a submittal is not complete
or not in accordance with procedures, such tender shall not be deemed to constitute a submittal for
purposes of satisfying the Schedule of Performance (Attachment No.2).
If the Developer desires to make any substantial changes in the construction
plans after their approval by the Agency and the City, the Developer shall submit the proposed
change to the Agency and the City for their approval. If the construction plans, as modified by the
proposed change, conform to the requirements of this Section 305 and the Scope of Development
(Attachment No. 1), the Agency and the City will approve the proposed change and notify the
Developer in writing within thirty (30) days after submission to the Agency and the City.
CONT.BDH 8
4. [305] Cost of Development
All costs for planning, designing, and constructing the Improvements shall
be borne exclusively by the Developer. The Developer shall also bear all costs related to discharging
the duties of the Developer set forth in this Agreement. The Developer assumes the responsibility
to construct, and shall let contracts for or cause to be constructed, all off -site public improvements
developed pursuant to this Agreement, substantially in conformity with procedures used by the
Agency when competitive bidding is deemed to be required. The Developer shall be responsible for
all fees associated with development of the Improvement, including, but not limited to, school
facilities fees and impact fees.
5. [306] Construction Schedule
The Developer shall commence and complete the Improvements by the
respective times established therefor in the Schedule of Performance (Attachment No. 2).
6. [307] Indemnity. Bodily Injury and Property Damage Insurance
The Developer shall defend, assume all responsibility for and hold the Agency
and the City, and their respective officers, agents and employees, harmless from all claims or suits
for, and damages to, property and.injuries to persons, including accidental death (including attorneys
fees and costs), which may be caused by any of the Developer's activities under this Agreement,
whether such activities or performance thereof be by the Developer or damage shall accrue or be
discovered before or after termination of this Agreement. The Developer shall take out and maintain
during the life of this Agreement a comprehensive liability policy in the amount of One Million
Dollars ($1,000,000) combined single limit policy, including contractual liability, as shall protect
the Developer, the City, and the Agency from claims for such damages.
Coverage shall be primary and not contributing with any policy or coverage
maintained by or obtained by the Agency, and an appropriate endorsement shall so state. The policy
shall contain a waiver of subrogation. Insurance coverage furnished by the Developer pursuant to
this Section 308 shall conform to this Section 308 and shall pertain to all activities on the Site and
adjacent public rights -of -way surrounding the Site and all work on off -site public improvements.
Developer shall furnish or cause to be furnished to the Agency a certificate
of insurance from the insurer evidencing compliance with this Section 308 and providing that the
insurer shall not change or modify the policy without thirty (30) days' prior written notice to Agency.
In the alternative, Developer may show proof of a certificate of consent to self -insure issued by the
Director of Industrial Relations according to California Labor Code Section 3800.
The Developer additionally agrees to and shall save the Agency and the City
and their officers, employees and agents harmless from and assume all responsibility for any and all
liability or responsibility for damage, costs losses, or suit arising in any manner from the approval
of this Agreement or the development and activities conducted pursuant to this Agreement. This
obligation and indemnification shall constitute a covenant running with the land throughout the life
of the Redevelopment Plan.
CONT.BDH 9
7. [308] City and Other Governmental Agency Permits
Before commencement of construction or development of any buildings,
structures or other works of improvement upon the Site or in connection with any off -site
improvement, the Developer shall, at its own expense, secure or cause to be secured any and all
permits which may be required by the City or any other governmental agent affected by such
construction, development or work. It is understood that the Developer's obligation is to pay all
necessary fees and to timely submit to the City final drawings with final corrections to obtain
building permit; the Agency will, without obligation to incur liability or expense therefor, use its best
efforts to expedite issuance of building permits and certificates of occupancy for construction that
meet the requirements of the City Code.
8. [309] Rights of Access
For purpose of assuring compliance with this Agreement, representatives of
the Agency and the City shall have the right of access to the Site without charges or fees, at normal
business hours during the period of this Agreement for the purposes of this Agreement, including,
but not limited to, the inspection of the work being performed in constructing the Improvements, so
long as they comply with all safety rules. Such representatives of the Agency or of the City shall be
those who are so identified in writing by the Executive Director of the Agency. The Agency shall
hold the Developer harmless from any bodily injury or related damages arising out of the activities
of the Agency and the City as referred to in this Section 310.
9. [310] Local, State and Federal Laws
The Developer shall perform under this Agreement and carry out its
performance under this Agreement, including without limitation the construction of the
Improvements, in conformity with all applicable federal and state laws and local ordinances,
including all applicable federal and state labor standards, as to the Site, provided, however,
Developer and its contractors, successors, assigns, transferees, and lessees are not waiving their
rights to contest any such laws, rules or standards.
10. [311 ] Anti -Discrimination
Pursuant to Section 33435 and 33050 of the California Community
Redevelopment Law, the Developer for itself and its successors and assigns, agrees, that in the
construction of Improvements on the Site or other performance under this Agreement, the Developer
will not discriminate against any employee or applicant for employment because of sex, marital
status, race, color, religion, ancestry, or national origin.
CONT.BDH 10
11. [312] Taxes and Assessments
After the Agency Conveyance the Developer shall pay prior to delinquency
all real estate taxes and assessments on the Site so long as the Developer retains any interest thereon.
Prior to the Developer Conveyance, the Developer shall remove or have removed any levy or
attachment made on any of the Site or any part thereof, or assure the satisfaction thereof within a
reasonable time but in any event prior to said sale or transfer. Notwithstanding the above, the
Developer shall have the right to contest the validity or amounts of any tax, assessment, or
encumbrance available to the Developer in respect thereto.
B. [313] Prohibition Against Transfer of the Site. the Buildings or Structures Thereon
and Assignment of Agreement
Except as to the sale of any home to an owner -occupant in accordance with this
Agreement, the Developer shall not, except as may be expressly permitted by this Agreement,
without prior approval of the Agency, make any total or partial sale, transfer, conveyance of, or enter
into any assignment or ground lease of or refinance the whole or any part of the Site or of the
buildings or structures on the Site. This prohibition shall not be deemed to prevent the granting of
temporary or permanent easements or permits to facilitate the development of the Site or to prohibit
or restrict the sale of "Restricted Units" to "Eligible Persons or Families" (as defined in Section 401)
in conformity with Section 401 of this Agreement.
C. [314] Right of the Agency to Satisfy Other Liens on the Sites) After Title Passes
After the Agency Conveyance and prior to the completion of construction, and after
the Developer has had written notice and has failed after a reasonable time, but in any event not less
than forty-five (45) days, to challenge, cure, adequately bond against, or satisfy any liens or
encumbrances on the Site which are not otherwise permitted under this Agreement, the Agency shall
have the right but no obligation to satisfy any such liens or encumbrances. Notwithstanding the
above, the Developer shall have the right to contest the validity or amounts of any tax, assessment,
or encumbrance available to the Developer in respect thereto.
D. [315] Certificate of Completion
Promptly after the completion of all of the Improvements and their sale to Eligible
Persons or Families (as defined in Section 401 hereof) in conformity with this Agreement (as
determined by the Executive Director of the Agency), upon the written request of the Developer
relating only to those Site as to which construction has been completed in accordance with this
Agreement the Agency shall furnish the Developer with the Certificate of Completion (in the form
attached hereto as Attachment No. 6) which evidences and determines the satisfactory completion
of the construction, development and sale to an Eligible Person or Family, as to any single-family
home, pursuant to the provisions and covenants specified in this Agreement, the Redevelopment
Plan and the California Community Redevelopment Law.
CONT.BDH 11
The issuance and recordation of a Certificate of Completion (Attachment No. 6) with
respect to the Improvements shall not supersede, cancel, amend or limit the continued effectiveness
of any obligations relating to the maintenance, or uses, or payment of monies, or any other
obligations, except for the obligation to complete construction of the Improvements as of the time
of the issuance of such applicable certificate.
If the Agency refuses or fails to furnish a Certificate of Completion after written
request from the Developer, the Agency shall, within forty-five (45) days of the written request,
provide the Developer with a written statement of the reasons the Agency refused or failed to furnish
such Certificate of Completion.
Upon issuance of a Certificate of Completion (Attachment No. 6) for the
Improvements, construction of such Improvements as to any single-family home shall be deemed
to have been completed in conformity with this Agreement. The Certificate of Completion
(Attachment No. 6) is not a notice of completion as referred to in Section 3093 of the California
Civil Code. The issuance of a Certificate of Completion shall not affect the continued effectiveness
of the Developer Deed of Trust (Attachment No. 4) and the Declaration of Conditions, Covenants
and Restrictions (Attachment No. 5) recorded pursuant to this Agreement.
IV. [400] USE OF THE SITE
A. [401 ] Affordable Housing
1. Number of Units.
Developer shall develop two (2) detached, single-family homes (the
"Restricted Units") within the Project Area and shall develop all on -site and off -site public
improvements connected therewith, all as described and set forth in the Scope of Development
(Attachment No. 1). Developer shall restrict each of the units for sale to a Low or Moderate Income
Household pursuant to the applicable income and affordability provisions contained herein. The
Developer further covenants and agrees that the above -referenced occupancy, ownership and
affordability requirements shall bind and be enforceable against the Site for the period of thirty (30)
years commencing with the acquisition of each respective parcel by the Developer with the
simultaneous recording of the Conditions, Covenants and Restrictions (Attachment No. 5).
2. Definitions.
(a) "Affordable Housing Cost" shall be that purchase price which would
result in maximum monthly housing payments for a thirty (30) year mortgage for that portion of the
purchase price which is to be paid in the form of loan proceeds under currently prevailing mortgage
loan rates or the interest rate of any below -market mortgage program for which such purchaser has
obtained a first trust deed loan, for the low or moderate income group calculated pursuant to Health
and Safety Code Section 50052.5, which sets forth the following formula:
CONT.BDH 12
Lower Income Households - whose gross incomes exceed the maximum
income for very low income households and do not exceed seventy percent (70%) of the area median
income adjusted for family size, the product of thirty percent (30%) times seventy percent (70%) of
the area median income adjusted for family size appropriate for the unit. In addition, for any lower
income household that has a gross income that equals or exceeds seventy percent (70%) of the area
median income adjusted for family size, it shall be optional for any state or local funding agency to
require that affordable housing cost not exceed thirty percent (30%) of the gross income of the
household.
Moderate Income Households - not less than twenty-eight percent (28%) of
the gross income of the household, nor more than the product of thirty-five percent (35%) times the
greater of one hundred ten percent (110%) of area median income adjusted for family size
appropriate for the Affordable Unit, or the gross income of the household for households earning
greater than one hundred percent (110%) and not more than one hundred twenty percent (120%) of
the area median income adjusted for family size.
(b) "Affordability Period" shall be thirty (30) years from the date of
transfer to an Eligible Person or Family.
(c) "Eligible Person or Family" shall mean any person or family who
meets the income qualifications for Moderate Income Households.
(d) "Lower Income Household" shall mean a household earning not
greater than eighty percent (80%) of Riverside County median income, as determined by the United
States Department of Housing and Urban Development from time to time, as set forth in Health and
Safety Code Section 50093.
(e) "Moderate Income Household" shall mean a household earning not
greater than one hundred twenty percent (120%) of Riverside County median income, as determined
by the United States Department of Housing and Urban Development from time to time, as set forth
in Health and Safety Code Section 50093.
(f) "Owner" shall mean Developer and any successor in interest of
Developer to any lot of the Site except where a provision of this Agreement expressly excludes
Developer from the definition of owner.
(g) "Proposed Transferee" shall mean a person or family determined to
be an Eligible Person or Family to whom the Developer or any successor Owner desires and
proposes to Transfer a Restricted Unit.
(h) "Purchase Housing Cost" or an Eligible Person or Family purchasing
a Restricted Unit shall include all of the following associated with that Restricted Unit, estimated
or known as of the date of their proposed sale of the Restricted Unit:
CONT.BDH 13
(i) Principal and interest on a mortgage loan including any
rehabilitation loans, and any loan insurance fees associated therewith.
property improvements.
(ii) Property taxes and assessments.
(iii) Fire and Casualty insurance covering replacement value of
(iv) Any homeowner association fees.
Monthly housing cost of a purchaser shall be an average of estimated costs for the next twelve (12)
months.
(i) "Restricted Unit" shall mean a dwelling unit, which shall be a single-
family residence, subject to the restrictions of this Agreement (including, without limitation, the
Declaration of Conditions, Covenants and Restrictions (Attachment No. 5)).
0) "Sales Price" shall mean all sums paid by a purchaser to a seller for,
or in conjunction with, the acquisition of a Restricted Unit, including the purchase price designated
in any purchase agreement, consideration for personal property and all other costs and fees paid by
the purchaser to or for the benefit of the seller.
(k) "Transfer" shall mean any sale, assignment, conveyance, lease or
transfer, voluntary or involuntary, of any interest in a Restricted Unit. Without limiting the
generality of the foregoing, Transfer shall include (i) a transfer by devise, inheritance or intestacy
to a party who does not meet the definition of Eligible Person or Family; (ii) a life estate; (iii)
creation of a joint tenancy interest; (iv) a gift of all or any portion of a Restricted Unit; or (v) any
voluntary conveyance of a Restricted Unit. Transfer shall not include transfer to a spouse in a
dissolution proceeding; however any subsequent Transfer shall be subject to this restriction.
(1) "Transferee" shall mean any natural person or entity who obtains
ownership or possessory rights in a Restricted Unit pursuant to a Transfer.
3. Sales of Restricted Units. Developer agrees that Developer shall sell each
Restricted Unit to an Eligible Person or Family at an Affordable Housing Cost (the "Developer
Conveyance") and that during the Affordability Period each subsequent resale of a Restricted Unit
by the then -Owner thereof shall be to an Eligible Person or Family at an Affordable Housing Cost.
Developer agrees that the Conditions, Covenants and Restrictions (Attachment No. 5) giving effect
to the foregoing restriction shall be recorded against each lot of the Site concurrently with the
Acquisition Escrow. Developer agrees to commence to market each Restricted Unit not later than
the completion of construction of each Restricted Unit; each Restricted Unit shall be sold to an
Eligible Person or Family prior to issuance of a Certificate of Completion as to any such Restricted
Unit for purposes of Section 322 hereof.
CONT.BDH 14
For purposes of satisfying the requirement that all of the Restricted Units shall be
occupied by Eligible Persons or Families: (a) an individual or family who qualifies as an Eligible
Person or Family at the time he or she first takes title to a Restricted Unit will be deemed an Eligible
Person or Family as long as he or she continues to hold title to such Restricted Unit even though the
Eligible Person or Family subsequently ceases to meet the income or other requirements of an
Eligible Person or Family, and (b) when an Owner releases title to a Restricted Unit, such unit will
be considered as occupied by an Eligible Person or Family if it is held vacant and available for such
occupancy until title is transferred to another Eligible Person or Family, at which time the status of
the new Owner as an Eligible Person or Family is to be determined.
4. Restrictions on Transfer by Sale of the Restricted Property or Any Restricted
Unit.
(a) For the duration of the Affordability Period, Developer, for itself and
any subsequent Owner, hereby subjects the Site to certain restrictions and limits the price at which
Developer or any other Owner may sell and/or resell the Site and the persons to whom Developer
or any other Owner may sell the Site.
(b) DEVELOPER AND ANY OTHER OWNER UNDERSTANDS
THAT THE DETERMINATION OF THE SALES PRICE CAN BE MADE ONLY AT THE TIME
OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES,
PROPERTY TAXES AND OTHER FACTORS THAT CANNOT BE ACCURATELY
PREDICTED AND THAT THE SALE PRICE PERMITTED HEREUNDER MAY NOT
INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL
PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. DEVELOPER AND
ANY OTHER OWNER FURTHER ACKNOWLEDGE THAT, AT ALL TIMES IN SETTING THE
SALES PRICE, THE PRIMARY OBJECTIVE OF THE AGENCY AND THIS AGREEMENT IS
TO PROVIDE HOUSING TO ELIGIBLE PERSONS OR FAMILIES AT AFFORDABLE
HOUSING COST. THE SALES PRICE MAY BE LESS THAN OTHER SIMILAR PROPERTIES
WHICH HAVE NO RESTRICTIONS.
I Z-) � tzs I
Develop s Initials
(c) Transfer of a Restricted Unit. Developer and any successor Owner
may transfer a Restricted Unit only in strict accordance with the provisions of this Agreement.
Specifically, during the Affordability Period, Owner may transfer a Restricted Unit (i) only to an
Eligible Person or Family and (ii) only if the Purchase Housing Cost does not exceed Affordable
Housing Cost for the Eligible Person or Family; and (iii) only if the Transfer has previously been
approved in writing by the Agency.
CONT.BDH 15
In order to comply with this Subsection 4(c), Developer and any successor
Owner must calculate the Affordable Housing Cost for the Proposed Transferee of the Restricted
Unit in accordance with the definition set forth in Subsection 2(a) of this Section 401. After
calculating the Affordable Housing Cost for the Proposed Transferee, the Owner must ensure that
the sum of the Sales Price and all costs listed in the definition of Purchase Housing Cost set forth
in Subsection 2 of Section 401 does not exceed that Affordable Housing Cost. The Calculation of
the Sales Price under this Subsection 4(c) is illustrated by example in Attachment No. '7 attached
hereto.
(d) In the event that after a good faith effort as defined in the Buyer
Promissory Note, the successor Owner is unable to obtain an Eligible Person or Family to transfer
the Restricted Unit, then after the required notice to and approval by the Agency Executive Director
the owner may sell the Restricted Unit to a noneligible party subject to the equity share provisions
of the Buyer Promissory Note and the Covenants, Conditions and Restrictions would be released.
(e) Notwithstanding anything to the contrary in this Section 401, at close
of the Developer Conveyance Escrow transferring the Restricted Unit from the Developer to the
Proposed Transferee (the "Initial Owner"), the Initial Owner shall execute a Buyer's Promissory Note
as approved by the Executive and Agency Counsel which Promissory Note shall be secured by a
Second Deed of Trust. The Buyer's Promissory Note shall be non -interest bearing. The principal
amount shall be equal to the amount of the Agency Assistance necessary for the Individual or Family
to qualify for the Lender's loan and ensure the affordability requirements are met as approved by the
Executive Director in accordance with the Agency's affordable housing program policies. The Note
Amount shall be due and payable according to its terms including any applicable equity sharing
provision. However, should the Initial Owner transfer the Restricted Unit to an Eligible Person,
Family at Affordable Housing Cost, the Transferee shall assume the Developer Promissory Note
(Attachment No. 3) and Agency shall extend the due date of the Note Amount until the next Transfer
of the Restricted Unit. The foregoing provisions will apply to every successive Transfer during the
Affordability Period.
5. Process to Complete Transfer by Sale of Restricted Units. Upon the Transfer
by sale of a Restricted Unit, the following procedures shall apply:
(a) Notice to City: Owner shall send to the Agency in care of the La
Quinta Housing Department (or its successor), at P.O. Box 1504, La Quinta, California 92253, the
forms attached hereto as Attachment Nos. 9 and 10 fully completed and executed by the Owner and
the Proposed Transferee (the "Notice of Intent to Transfer" and "Approval Request").
(b) Qualification of Proposed Transferee. No Transfer shall occur unless
and until determination is made based on the Certificate in the form of Attachment No. 8 attached
hereto ("Certificate") and attachments thereto, that the Proposed Transferee (i) intends to occupy the
Restricted Unit as the Proposed Transferee's principal residence and (ii) is an Eligible Person or
Family. Each Proposed Transferee shall submit a Certificate to the Developer certifying its intent
with regard to the occupancy of the Restricted Unit and as to the truth and accuracy of all
CONT.BDH 16 .
information supplied as to the Gross Income (calculated as set forth in 25 Cal. Code of Regs.,
Section 6914) of the Proposed Transferee ("Proposed Transferee's Certificate"). Developer or
subsequent owner shall certify pursuant to Attachment No. 8 hereof the information provided on the
Proposed Transferee's Certificate pursuant to direction on that Certificate. Developer or subsequent
owner shall be entitled to rely on the information on the Proposed Transferee's Certificate and
attachments thereto in making the determination required by this subsection 5(b) unless the
Developer or subsequent owner has knowledge of, or a reasonable basis for belief as to the
inaccuracy or falsehood of the Proposed Transferee's Certificate.
(c) The Sales Price for the Restricted Unit shall not exceed the maximum
price at which the Purchase Housing Cost to be paid by the Proposed Transferee would not exceed
Affordable Housing Cost. The calculation of the Sales Price under this subsection is illustrated by
example in Attachment No. 7 attached hereto. However, in determining Affordable Housing Cost,
the family size of the Proposed Transferee shall be deemed to be persons in the case of a 1 bedroom,
3 persons for a 2 bedroom, 4 persons for a 3 bedroom, or 5 persons for a 4 bedroom Restricted Unit.
If the actual family size of the Proposed Transferee is larger, then the actual family size shall be used.
(d) Certificates from Parties. With respect to each sale of a Restricted
Unit, Developer or subsequent owner shall submit to the Agency, not later than four (4) weeks prior
to close of escrow on the sale of a Restricted Unit, a certificate that (I) the Developer or subsequent
owner has made the affirmative determinations required by Section 4(a) above and (ii) the Sales
Price conforms with Section 4(b) above. The Developer or subsequent owner shall concurrently
submit to the Agency the Proposed Transferee's Certificate and all attachments thereto and all other
documents or material with regard to information required by Sections 4(a) and/or (b) above,
whether or not relied on by the Developer. Further, the Developer or subsequent owner and
Proposed Transferee each shall certify in writing, in a form acceptable to the Agency, that the
Transfer shall be closed in accordance with, and only with, the terms of the sales contract and other
documents submitted to and approved by the Agency and that all consideration delivered by the
Proposed Transferee to Developer or subsequent owner has been fully disclosed to the Agency. The
written certificate shall also include a provision that, in the event a Transfer is made in violation of
the terms of this Agreement or false or misleading statements are made in any documents or
certificate submitted to the Agency for its approval of the Transfer, the Agency shall have the right
to file an action at law or in equity to seek termination and/or rescission of the sales contract and/or
declare the sale void, notwithstanding the fact that the Transfer may have closed and become final
as between Developer or subsequent owner and its Transferee. In the event Developer for the initial
transfer or subsequent owner for each following transfer fails to comply with Sections 4(a) or 4(b)
above, any costs, liabilities or obligations incurred by the Developer or subsequent owner and its
Transferee for the return of any monies paid or received or for any costs and legal expenses, shall
be borne Jointly and severally by the Developer and its transferee and such parties shall hold the City
and Agency harmless and reimburse their expenses, legal fees and costs for any action and City
and/or Agency take in enforcing the terms of this Section 401.
(e) Execution of Promissory Note and Second Deed of Trust.
Notwithstanding anything to the contrary in this Agreement, at close of Escrow of the sale of the
Housing Unit from the Developer to the Buyer, the Buyer shall execute a Buyer Promissory Note
which shall be secured by a Second Deed of Trust. Said Second Deed of Trust shall be subordinate
CONT.BDH 17
to any mortgage(s) obtained by the Owner for the purpose of securing funds to be applied to the
Sales Price of the Housing Unit. The Buyer Promissory Note shall be non -interest bearing. The
principal amount of the Promissory Note shall be an amount equal to the amount actually given as
cash plus an Agency Equity Share Amount which becomes applicable only in the event that the
Buyer is unable after good faith efforts to find an Eligible Person or Family to transfer the home at
Affordable Housing Cost. In the event that the Buyer has provided the Agency with evidence of
their good faith efforts then Agency may approve the sale to a nonqualified buyer and release the
covenants by receiving in addition to the cash amount originally provided the additional Agency
Equity Amount as provided under the terms of the Buyer Promissory Note.
So long as the Transferee purchasing the Housing Unit from the Owner is an Eligible
Person or Family and the Sale of the Housing Unit is made at a price which is not in excess of
Affordable Housing Cost, the Transferee shall assume the obligations. of the Owner under the
Promissory Note and Second Deed of Trust to repay the Agency Equity pursuant to the Promissory
Note by execution of an assumption agreement in the form set forth as Attachment No. 11 of this
Agreement, together with other written documentation satisfactory to the Agency, and Agency shall
extend the due date of the Agency Equity pursuant to the Note Amount until the next Transfer of the
Housing Unit by said Transferee. At such next Transfer, the Agency will again extend the due date
of the Agency Equity pursuant to the Note Amount if the Sale or Transfer complies with the
requirements of this Section. So long as each Transferee from the Owner and each subsequent
Owner: (1) is an Eligible Person or Family, (2) acquires the Housing Unit at an Affordable Housing
Cost, and (3) assumes the obligations of the predecessor Owner as aforesaid; then the Agency agrees
to extend the due date of the Agency Equity pursuant to the Note Amount and the transferring Owner
shall not be required to pay the Agency Equity potion of the Note Amount upon transfer of the
Housing Unit.
The Agency Equity payment requirement is intended as a penalty against the Owner,
to capture a portion of the equity in the Restricted Property for the benefit of the Agency/Holder, in
the event that the Owner makes a sale of the Restricted Property to a Buyer that is not an Eligible
Person or Family. This equity recapture requirement is intended to be a cumulative remedy, together
with all other remedies available to the Agency/Holder to compensate for the removal of the
affordable housing covenants of the Grant Deed and this Agreement on the Housing Unit, to
compensate the Agency for the administrative costs of operating the housing program of the Agency
and to provide funds to the Agency to further assist low and moderate income persons in the
provision of housing. In the event the equity recapture provisions of the Promissory Note are found
by a court or administrative agency of competent jurisdiction to be in contravention of law or
administrative regulation, the Applicable Percentage shall be reduced to the maximum percentage
allowable by applicable law or administrative regulation, or may be otherwise modified by judicial
decree or order so as to comply with applicable law.
(f) Written Consent of Agency Required Before Transfer. During the
Affordability Period the Restricted Property or the Restricted Unit, as the case may be, and any
interest therein, shall not be conveyed by any Transfer except with the express written consent of the
Agency, which consent shall be given only if the Transfer is consistent with the Agency's goal of
creating, preserving, maintaining and protecting housing in the City of La Quinta for Eligible Persons
CONT.BDH 18
and Families and shall be in accordance with the provisions of this subsection 5. This provision shall
not prohibit the encumbering of title for the sole purpose of securing financing of the purchase price
of the Restricted Unit.
(g) Delivery of Documents. Upon the close of the proposed Transfer, the Owner
and Transferee, as applicable, shall provide the Agency with a certified copy of the recorded
Assumption Agreement, a copy of the final sales contract, settlement statement, escrow instructions,
all certificates required by this subsection 5 and any other documents which the Agency may request.
6. Covenants of Owner. The Owner of each Restricted Unit by acceptance of
a deed to the Restricted Unit covenants and agrees that, at all times during the Affordability Period,
its Restricted Unit will be continuously occupied by Owner as its principal residence, and shall not
be rented, subleased, or subject to any other business arrangement, whereby consideration shall be
paid by any occupant of a Restricted Unit to the Owner of the Restricted Unit; provided, if the
Restricted Unit is occupied by an Eligible Person or Family, the family members whose income was
considered in determining the eligibility of that family may make monetary contributions toward the
Purchase Housing Costs of the Restricted Unit. Owner agrees that it shall not record or cause the
recordation of any deed of trust (a "Further Encumbrance") securing a note having an original
principal sum which, when added to the sum of the principal amount(s) of any notes secured by any
deeds of trust against the Restricted Property as of the date of recordation of the Further
Encumbrance, exceeds the fair market value of the Restricted Property.
B. [4021 Uses In Accordance with Redevelopment Plan: Nondiscrimination
The Developer covenants and agrees for itself, its successors, its assigns, and every
successor in interest to the Site or any part thereof that the Developer and such successors and
assignees, shall devote the Site to the uses specified in the Redevelopment Plan, the Grant Deed
(Attachment No. ___), the Declaration of Conditions, Covenants and Restrictions (Attachment No.
5) and this Agreement for the periods of time specified therein. The foregoing covenants shall run
with the land.
The Developer covenants by and for itself and any successors in interest that there
shall be no discrimination against or segregation of any person or group of persons on account of
race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease, sublease,
transfer, use, occupancy, tenure or enjoyment of the Site, nor shall the Developer itself or any person
claiming under or though it establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use or occupancy of tenants, lessees,
subtenants, sublessees or vendees of the Site. The foregoing covenants shall run with the land.
The Developer shall refrain from restricting the rental, sale or lease of the property
on the basis of race, color, creed, religion, sex, marital status, national origin or ancestry of any
person. All such deeds, leases or contracts shall contain or be subject to substantially the following
nondiscrimination or nonsegregation clauses:
CONT.BDH 19
l . In deeds: "The grantee herein covenants by and for himself or herself, his or
her heirs, executors, administrators and assigns, and all persons claiming under or through his or her
heirs, executors, administrators and assigns, and all persons claiming under or through them, that
there shall be no discrimination against or segregation of, any person or group of persons on account
of race, color, creed, religion, sex, marital status, national origin or ancestry in the sale, lease,
sublease, transfer, use, occupancy, tenure or enjoyment of the land herein conveyed, nor shall the
grantee himself or herself or any person claiming under or though him or her, establish or permit any
such practice or practices of discrimination or segregation with reference to the selection, location,
number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in the land herein
conveyed. The foregoing covenants shall run with the land."
2. In leases: "The lessee herein covenants by and for himself or herself, his or
her heirs, executors, administrators and assigns, and all persons claiming under or through him or
her, and this lease is made and accepted upon and subject to the following conditions:
"There shall be no discrimination against or segregation or any person or
group of persons on account of race, color, creed, religion, sex, marital status, ancestry or national
origin in the leasing, subleasing, transferring, use, occupancy, tenure or enjoyment of the premises
herein leased nor shall the lessee himself or herself, or any person claiming under or through him or
her, establish or permit any such practice or practices of discrimination or segregation with reference
to the selection, location, number, use or occupancy of tenants, lessees, sublessees, subtenants or
vendees in the premises herein leased."
3. In contracts: "There shall be no discrimination against or segregation of, any
person, or group of persons on account of race, color, creed, religion, sex, marital status, ancestry
or national origin, in the sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the
premises, nor shall the transferee himself or herself or any person claiming under or through him or
her, establish or permit any such practice or practices of discrimination or segregation with reference
to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or
vendees of the premises."
The covenants established in this Agreement and the deeds of conveyance for the Site
shall, without regard to technical classification and designation, be binding for the benefit and in
favor of the Agency, its successors and assigns, the City and any successor in interest to the Sites,
together with any property acquired by the Developer pursuant to this Agreement, or any part thereof.
The covenants against racial discrimination shall remain in effect in perpetuity.
C. [403] Effect of Violation of the Terms and Provisions of this Agreement After
Completion of Construction
The Agency is deemed the beneficiary of the terms and provisions of this Agreement
and of the covenants running with the land, for and in its own rights and for the purposes of
protecting the interests of the community and other parties, public or private, in whose favor and for
whose benefit this Agreement and the covenants running with the land have been provided. The
Agreement and the covenants shall run in favor of the Agency, without regard to whether the Agency
CONT,BDH 20
has been, remains or is an owner of any land or interest therein in the Site or in the Project Area. The
Agency shall have the right, if this Agreement or covenants are breached, to exercise all rights and
remedies, and to maintain any actions or suits at law or in equity or other property proceedings to
enforce the curing of such breaches to which it or any other beneficiaries of this Agreement and
covenants may be entitled.
D. [404] Maintenance of the Site
The Developer shall maintain the improvements on the Site in conformity with the
La Quinta Municipal Code and the requirements of the Declaration of Conditions, Covenants and
Restrictions (Attachment No. 5), and shall keep the Site free from any accumulation of debris or
waste materials.
The Developer shall also maintain the landscaping required to be planted under the
Scope of Development (Attachment No. 1) in a healthy and attractive condition. If, at any time,
Developer fails to maintain the Site or any portion thereof, and said condition is not corrected as
soon as reasonably possible after written notice from the Agency, either the Agency or the City may
perform the necessary maintenance and Developer shall pay such costs as are reasonably incurred
for such maintenance.
Upon the close of each Developer Conveyance, the Developer's obligations under this
Section 404 with respect to such Site shall be assumed by the Transferee of such Site. This covenant
shall run with the land and shall remain in effect for the term of the Redevelopment Plan.
V. [500] DEFAULTS AND REMEDIES
A. [501 ] Defaults -- General
Subject to the extensions of time set forth in Section 603, failure or delay by either
party to perform any term or provision of this Agreement constitutes a default under this Agreement.
A party claiming a default shall give written notice of default to the other party, specifying the
default complained of and the actions required to correct such default.
Except as otherwise expressly provided in Sections 508 and 509 of this Agreement,
the claimant shall not institute proceedings against the other party if the other party within thirty (30)
days from receipt of such notice immediately, with due diligence, commences to cure, correct or
remedy such failure or delay and shall complete such cure, correction or remedy as soon as
reasonably practicable after receipt of such notice.
B. [502] Legal Actions
[503] Institution of Legal Actions
In addition to any other rights or remedies and subject to the restrictions in
Section 501, either party may institute legal action to seek specific performance of the terms of this
Agreement, or to cure, correct or remedy any default, to recover damages for any default, or to obtain
CONT.BDH 21
any other legal or equitable remedy consistent with the purpose of this Agreement. Such legal
actions must be instituted in the Superior Court of the County of Riverside, State of California, in
an appropriate municipal court in that county, or in the Federal District Court in the Central District
of California.
2. [504] Applicable Law
The laws of the State of California shall govern the interpretation and
enforcement of this Agreement.
;. [505] Acceptance of Service of Process
In the event that any legal action is commenced by the Developer against the
Agency, service of process on the Agency shall be made by person service upon the Executive
Director or in such other manner as may be provided by law.
In the event that any legal action is commenced by the Agency against the
Developer, service of process on the Developer shall be made by personal service upon any officer
or director of the Developer and shall be valid whether made within or without the State of
California or in such other manner as may be provided by law.
C. [506] Rights and Remedies Are Cumulative
Except as otherwise expressly stated in this Agreement, the rights and remedies of
the parties are cumulative, and the exercise by either party of one or more of such rights or remedies
shall not preclude the exercise by it, at the same or different times, of any other rights or remedies
for the same default or any other default by the other party.
D. [507] Inaction Not a Waiver of Default
Any failures or delays by either party in asserting any of its rights and remedies as to
any default shall not operate as a waiver of any default or of any such rights or remedies, or deprive
either such party of its right to institute and maintain any actions or proceedings which it may deem
necessary to protect, assert or enforce any such rights or remedies.
E. [508] Remedies and Rights of Termination
1. [509] Damages
If either party defaults with regard to any of the provisions of this Agreement,
the non -defaulting party shall serve written notice of such default upon the defaulting party. If the
default is not cured or commenced to be cured by the defaulting party within forty-five (45) days
after service of the notice of default (or within such other period as is set forth herein), the defaulting
party shall be liable to the other party for any damages caused by such default.
CONT.BDH 22
2. [510] Specific Performance
If either party defaults under any of the provisions of this Agreement, the non -
defaulting party shall serve written notice of such default upon the defaulting party. If the default
is not cured and/or commenced to be cured by the defaulting party within forty-five (45) days of
service of the notice of default, or such other time limit as may be set forth herein with respect to
such default, the non -defaulting party as its option may thereafter (but not before) commence an
action for specific performance of terms of this Agreement.
3. [511 ] Right of Termination by the Developer
In the event that the Agency does not fund the portion of the Developer
Promissory Note for the acquisition costs in the manner and condition, and by the date established
in this Agreement and the Schedule of Performance (Attachment No. 2), and any such failure shall
not be cured within thirty (30) days after written demand by the Developer then, at the option of the
Developer, upon written notice thereof to the Agency, all provisions of this Agreement shall
terminate and be of no further force and effect; thereafter, neither the Agency nor the Developer shall
have any further rights against or liability to the other with respect to this Agreement.
Notwithstanding the above, developer would be entitled to the return of any Acquisition Deposit for
a site not transferred pursuant to Section 202 herein.
Note:
4. [512] Termination by the Agency
In the event that prior to the Agency funding of the Developer Promissory
(a) The Developer (or any successor in interest) assigns or attempts to
assign the Agreement or any rights therein or in the Site(s) in
violation of this Agreement; or
(b) There is a charge in the ownership of the Developer contrary to the
provisions of Section 107(a) hereof; or
(c) The Developer does not submit certificates of insurance, construction
plans, drawings and related documents as required by this Agreement,
in the manner and by the dates respectively provided in this
Agreement therefor, and such default or failure shall not be cured or
commenced to be cured within forty-five (45) days after the date of
written demand therefor by the Agency; or
(d) The Developer fails to satisfy the Conditions Precedent to the
Conveyance by the time established therefor in the Schedule of
Performance (Attachment No. 2); or
(e) The Developer is otherwise in default under this Agreement and such
failure is not cured or commenced to be cured within thirty (30) days
of demand therefor by the Agency;
CONT.BDH 23
then, at the option of the Agency, upon such written notice thereof to the Developer as may be set
forth above, this Agreement shall be terminated, and thereafter neither party shall have any further
rights or liability against the other under this Agreement.
F. [513] Remedies of the Parties for Default After Closing of the Acquisition Escrow
1. [514] Termination and Damages
After the Close of the Acquisition Escrow, if the Developer or the Agency
defaults with regard to any of the provisions of this Agreement, the nondefaulting party shall serve
written notice of such default upon the defaulting party. If the default is not cured or commenced
to be cured (and diligent efforts toward curing the default) by the defaulting party within thirty (30)
days after service of the notice of default, the defaulting party shall be liable to the other party for
any damages caused by such default.
VI. [600] GENERAL PROVISIONS
A [601 ] , Notices. Demands and Communications Between Parties
Written notices, demands and communications between the Agency and the
Developer shall be sufficiently given if delivered by hand or dispatched by registered or certified
mail, postage prepaid, return receipt requested, to the principal offices of the Agency and the
Developer at the addresses specified in Section 105 and 106, respectively. Such written notices,
demands and communications may be sent in the same manner to such other addresses as either party
may from time to time designate by mail as provided i this Section 601.
Any written notice, demand or communication shall be deemed received immediately
if delivered by hand and shall be deemed received on the tenth (loth) day from the date it is
postmarked if delivered by registered or certified mail.
B. [602] Conflicts of Interest
No member, official or employee of the Agency shall have any personal interest,
direct or indirect, in this Agreement, nor shall any member, official or employee participate in any
decision relating to the Agreement which affects his personal interests or the interests of any
corporation, partnership or association in which he is directly or indirectly interested. No member,
official or employee of the Agency shall be personally liable to the Developer, or any successor in
interest, in the event of any default or breach by the Agency, or for any amount which may become
due to the Developer or successor or on any obligations under the terms of this Agreement.
C. [603] Enforced Delay. Extension of Times of Performance
In addition to specific provisions of this Agreement, performance by either party
hereunder shall not be deemed to be in default, and al performance and other date specified in this
Agreement shall be extended, where delays or defaults are due to: war; insurrection; strikes;
lockouts; riots; floods; earthquakes; fires; casualties; acts of God; acts of the public enemy;
epidemics; quarantine restrictions; freight embargoes; lack of transportation; governmental
CONT.BDH 24
restrictions or priority; litigation; unusually severe weather; inability to secure necessary labor,
materials or tools; delays of any contractor; subcontractor or supplier; acts or omissions of the other
party; acts or failures to act of the City of La Quinta or any other public or governmental agency or
entity (other than the acts or failures to act of the Agency which shall not excuse performance by the
Agency); or any other causes beyond the control or without the default of the party claiming an
extension of time to perform. Notwithstanding anything to the contrary in this Agreement, an
extension of time for any such cause shall be for the period of the enforced delay and shall
commence to run from the time of the commencement of the cause, if notice by the party claiming
such extension is sent to the other party within thirty (30) days of the commencement of the cause.
Times of performance under this Agreement may also be extended in writing by the mutual
agreement of Agency and Developer.
Notwithstanding the foregoing portion of this Section 603, the Developer is not
entitled pursuant to this Section 603 to an extension of time to perform because of past, present, or
future difficulty in obtaining suitable construction financing for the development of the Site or
because of the physical condition or suitability of the Site for the purposes of this Agreement.
D. [604] Non -Liability of Officials and Employees of the Agency and the Developer
No member, official or employee of the Agency or the City shall be personally liable
to the Developer, or any successor in interest, in the event of any default or breach by the Agency
or the City or for any amount which may become due to the Developer or its successors, or on any
obligations under the terms of this Agreement.
No officer, director or employee of the Developer shall be personally liable to the
Agency or the City, or any successor in interest, in the event or breach by the Developer.
E. [605] Entire Agreement, Waivers
This Agreement is executed in three (3) duplicate originals, each of which is deemed
to be an original. This Agreement includes pages 1 through 27 and Attachment Nos. 1 through 11,
which constitutes the entire understanding and agreement of the parties. Each of the foregoing
Attachments are incorporated herein by reference.
This Agreement integrates all of the terms and conditions mentioned herein or
incidental hereto, and supersedes all negotiations or previous agreements between the parties or their
predecessors in interest with respect to all or any part of the subject matter hereof.
All waivers of the provisions of this Agreement must be in writing by the appropriate
authorities of the Agency and the Developer, and all amendments hereto must be in writing by the
appropriate authorities of the Agency and the Developer.
In any circumstance where under this Agreement either party is required to approve
or disapprove any matter, approval shall not be unreasonably withheld.
CONT.BDH 25
VII. [700] TIME FOR ACCEPTANCE OF AGREEMENT BY AGENCY
This Agreement, when executed by the Developer and delivered to the Agency, must be
authorized, executed and delivered by the Agency on or before C;t/ , 1998 or this
Agreement shall be void, except to the extent that the Developer shall con ent in writing to a further
extension of time for the authorization, execution and delivery of this Agreement. The date of this
Agreement shall be the date when it shall have been signed by the Agency.
IN WITNESS WHEREOF, the Agency and the Developer have signed this Agreement on
the respective dates set forth below.
Dated: S- S 5'�?
ATITEST:
UNDRA L. JUHOLA, Agency Secretary
APPROVED AS TO FORM:
C.
DAWN HONEYWELL, Agency Counsel
Dated: %0 CIE
LA QUINTA REDEVELOPMENT
public body corporate and politic
By.
RON PERKINS, Chairman
AGENCY, a
BUILDING HORIZONS, a California nonprofit
public benefit corporation
I2
Its:
2t6 0 -7 ✓� � / ��C�D
CONT.BDH 26
ATTACHMENT NO. 1
SCOPE OF DEVELOPMENT
DEVELOPMENT
Development shall cause the construction and installation of a single family home on each
lot of the Site. The homes shall be approximately 1,400 square feet in size. The homes shall be
developed in accordance with four bedroom floor plans and site elevations which have been or which
shall have been approved by the City and the Agency. Unit amenities include front
landscaped/irrigated yards; interior laundries with sink and cabinets; kitchens that feature tile
countertops, dishwashers, built-in ranges, oak cabinetry, and nooks/pantries; tile roofs; and concrete
block perimeter fencing.
The Developer shall complete all of the improvements set forth in this Scope of Development
(Attachment No. 1) to be constructed on each lot. All of the improvements to be described in part
IV of this Scope of Development, constitute the "Improvements."
The developer shall commence and complete the Improvements by the respective times
established therefor in the Schedule of Performance (Attachment No. 2).
II. DEVELOPMENT STANDARDS
The following development standards shall apply to the Developer Improvements:
A. Building Setbacks. Minimum building setbacks for building and parking areas shall
be as required by the Redevelopment Plan and approved by the Agency, and shall conform to the La
Quinta City Code (the "City Code").
B. Building Coverage. The amount of land within the Site covered by buildings shall
be as required by the Redevelopment Plan and local zoning.
C. Building Height. Buildings shall not exceed the height as may be limited by the
Redevelopment Plan and local zoning.
D. Landscaping. The Developer shall provide and, pending the sale of the Site, maintain
landscaping on the Site.
Landscaping shall be subject to approval by the City's Planning Department prior to
planting.
E. Utilities. Sewer drainage and utility lines, conduits or systems shall not be
constructed or maintained above the ground level of the Site. Storm drainage for all hard surfaced
areas shall be drained or may be sheet flowed to storm sewers. All non -polluted waste water, such
as waste air conditioning water, shall be drained to the storm or sanitary drainage systems as
permitted by local codes.
CONT.BDH
F. Building Materials. All exterior walls shall be painted or covered by the Developer
with color(s) and materials subject to approval by the City's Community Development Department.
In satisfaction of this requirement, the Developer shall submit a color and materials board for
approval by the Agency.
G. Building Design. Buildings shall be constructed such that the Developer
Improvements shall conform to the City Code, and shall be effectively and aesthetically designed.
III. PUBLIC IMPROVEMENTS AND UTILITIES
The Developer, at its own cost and expense, with the exception of the Agency Assistance as
provided in Section 201 of the Agreement, shall provide or cause to be provided the public
improvements as required by the City pursuant to the usual City building permit requirements for
off -site improvements to residential development within the time set forth for the completion of the
Developer Improvements in the Schedule of Performance (Attachment No. 4).
Those of the improvements required to be provided pursuant to this part III of this Scope of
Development (Attachment No. 1) constitute the "Off -Site Improvements."
IV. DEMOLITION AND SOILS
In accordance with Section 211 of the Agreement, the Developer shall at its cost take all
actions necessary to render the Site entirely suitable for such development, including any demolition
and soils work.
V. AMENDMENTS
Any material change, as reasonably determined by the Agency, in the Scope of Development
(Attachment No. 1) or in the approved site plan which affects the size, quality, or type of
development proposed for one or more of the Site shall require the written approval of the Agency,
which approval may be contingent upon the review and renegotiation of all of the economic and
financial terms of this Agreement and such other matters as the Agency shall deem appropriate.
It shall be up to the discretion of the Agency Executive Director whether a proposed material
change to this Scope of Development requires approval by the Agency Board or whether such change
may be approved in writing by the Agency Executive Director.
CONT.BDH 2
ATTACHMENT NO. 2
SCHEDULE OF PERFORMANCE
GENERAL PROVISIONS
Execution of Agreement by Agencv.
The Agency shall approve and execute
this Agreement, and shall deliver one
(1) copy thereof to the Developer.
II. CONSTRUCTION DOCUMENTS
AND BUILDING PERMITS
Submittal of Site Plan. Developer
shall prepare and submit to the
Agency the Site Plan for the two units.
Submission of Complete Construction
Drawings and Landscaping Plan.
Developer shall submit to the Agency
complete Construction (working)
Drawings for the two units.
4. Obtaining_of Building Permits.
Developer shall satisfy all
requirements necessary to obtain al
building and other permits needed to
commence construction of the
Improvements for each unit.
III. ACQUISITION OF SITE
5. Conditions Precedent. All Conditions
Precedent to funding the acquisition
are satisfied.
6. Acquisition of Site. The acquiring of
the Site is effected.
Not later than thirty (30) days after the
date of execution and submission of three
(3) copies of this Agreement by the
Developer.
Within thirty (30) days after the execution
of this Agreement by the Agency.
Not later than thirty (30) days after
Agency approval of Site Plan.
Not later than thirty (30) days after
Agency approval of Complete
Construction (working) Drawings and
Landscaping Plan.
Not later than sixty (60) days after
execution of this Agreement by the
Agency.
As soon as reasonably possible after
satisfactory fulfillment of the Conditions
Precedent to the Agency Assistance and
funding of the Developer loan.
CONT.BDH
IV. CONSTRUCTION PHASE
7. Commencement of Construction.
Developer shall commence
construction of the Improvements for
each Site.
8. Completion of Construction.
Developer shall complete construction
of all of the Improvements for each
lot.
V. TRANSFER STAGE
9. Sales of Residences. Each Residence
shall be sold to an Eligible Person or
Family.
10. Partial Certificates of Completion.
Certificates of Completion for each lot
shall be recorded simultaneous with
the transfer to an Eligible Person or
Family.
Not later than thirty (30) days after
Developer acquisition of each lot.
Within two hundred seventy (270) days
after the commencement of construction
for each lot.
Within six (6) months from issuance of
certificate of occupancy.
Minor revisions to this Schedule of Performance may be approved in writing by the Agency
Executive Director.
CONT.BDH 2
ATTACHMENT NO. 3
DEVELOPER PROMISSORY NOTE
$105,000 La Quinta, California
FOR VALUE RECEIVED, BUILDING HORIZONS, INC., collectively, "Maker" promise
to pay to LA QUINTA REDEVELOPMENT AGENCY, a public body corporate and politic
("Holder") at La Quinta, California, or at such other address as Holder may direct from time to time
in writing, the sum of $105,000 (the "Note Amount"), together with interest thereon at the rate set
forth herein. All sums payable hereunder shall be payable in lawful money of the United States of
America. This Developer Promissory Note ("Note") is made in connection with the provision by the
Holder of funds equal to the approved Acquisition Costs and Construction Costs pursuant to that
certain Affordable Housing Agreement by and among Maker and the Holder, dated as of
, 1998 (the "Agreement").
1. Disbursements. The Note Amount shall be disbursed pursuant to Sections 201 and
205 of the Agreement. The record of such disbursements shall be recorded from time to time by the
Agency Executive Director or his designee on Exhibit A to this Developer Promissory Note.
2. Obligation to Pay. The Note Amount shall be due and payable in full upon the
Developer conveyance of the property.
3. Prepayment of Note Amount. Maker may prepay to Holder the full Note Amount at
any time prior to the due date of the Note Amount without penalty.
4. Securitv. This Note is secured by a Developer Deed of Trust by and between Maker,
as trustor, and Holder, as beneficiary (the "Developer Deed of Trust").
5. Holder May Assign. Holder may, at its option, assign its right to receive payment
under this Note without necessity of obtaining the consent of the Maker.
6. Makers Assignment Prohibited. In no event shall Maker assign or transfer any
portion of this Note without the prior express written consent of the Holder, which consent may be
given or withheld in the Holder's sole discretion.
7. Attorneys' Fees and Costs. In the event that any action is instituted with respect to
this Note, the prevailing party promises to pay such sums as a court may fix for court costs and
reasonable attorneys' fees. Holder's right to such fees shall not be limited to or by its representation
by staff counsel and such representation shall be valued at customary and reasonable rates for private
sector legal services.
8. Time of the Essence. Time is of the essence of the performance of all obligations
under this Promissory Note.
CONT.BDH
9. Non -Waiver. Failure or delay in giving any notice required hereunder shall not
constitute a waiver of any default or late payment, nor shall it change the time for any default or
payment.
10. Successors Bound. This Note shall be binding upon the parties hereto and their
respective heirs, successors and assigns.
BUILDING HORIZONS, a California nonprofit
public benefit corporation
Dated:
Its:
•
LA QUINTA REDEVELOPMENT AGENCY, a
public body corporate and politic
Dated:
THOMAS P. GENOVESE, Executive Director
ATTEST:
SAUNDRA L. JUHOLA, Agency Secretary
"HOLDER"
CONT.BDH 2
EXHIBIT "A" TO
ATTACHMENT NO. 6
DISBURSEMENT RECORD
Disbursement Amount Date Acknowledgment of
Receipt of Maker
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
CONT.BDH 3
ATTACHMENT NO.4
CONSTRUCTION DEED OF TRUST
[To be approved by Agency Counsel and Executive Director
for recording prior to funding under the Developer Promissory Note]
CONT.BDH
ATTACHMENT NO. 5
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
LA QUINTA REDEVELOPMENT AGENCY )
78-495 Calle Tampico )
La Quinta, California 92253 )
Space above for recorder.
This Agreement is recorded at the request and
for the benefit of the Agency and is exempt
from the payment of a recording fee pursuant
to Government Code Section 6103.
LA QUINTA REDEVELOPMENT AGENCY
By:
Its:
Dated:
1998
DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS
THIS DECLARATION OF CONDITIONS, COVENANTS AND RESTRICTIONS
is made this day of , 1998, by BUILDING HORIZONS, a California nonprofit
public benefit corporation, as declarant (the "Developer"), with reference to the following:
A. The Developer is fee owner of record of that certain real property located in the City
of La Quinta, County of Riverside, State of California legally described in the attached Exhibit "A"
(the "Property"),which is comprised of (__) parcels ("Parcels"). The Property comprises
the Site which is the subject of an agreement, further described herein, for the development,
operation and maintenance of the Property for moderate -income housing. The Property is to be used
for the development of single-family housing units and subsequent occupancy as a primary residence
by households meeting certain income qualifications, all in conformity with this Declaration and an
Affordable Housing Agreement between the Developer and the Agency dated as of , a copy
of which is on file with the Agency as a public record (the "Agreement").
B. The Property is within the Redevelopment Project (the "Project") in the City of La
Quinta and is subject to the provisions of the Redevelopment Plan for the Project adopted by
Ordinance No. 43 on November 29, 1995, and amended by Ordinance No. on ,
199_ by the City Council of the City of La Quinta.
CONT.BDH 2
C. The La Quinta Redevelopment Agency ("Agency") and the Developer have entered
into an Affordable Housing Agreement dated as of , 199_ concerning the development
and use of the Property (the "Agreement") which Agreement is on file with the Agency as a public
record and is incorporated herein by reference and which Agreement provides for the execution and
recordation of this document.
D. Developer deems it desirable to impose a general plan for the use and maintenance
of the Property, and to adopt and establish covenants, conditions and restrictions upon the Property
for the purpose of enforcing and protecting the value, desirability and attractiveness thereof.
E. Developer will convey title to all portions of said Property (including each Parcel)
subject to certain protective covenants, conditions, and restrictions hereinafter set forth.
NOW, THEREFORE, Declarant hereby covenants, agrees and declares that all of the
Property shall be held, sold, conveyed, hypothecated, encumbered, used, occupied and improved,
subject to the following covenants, conditions, restrictions and easements which are hereby declared
to be for the benefit of the whole Property. These covenants, conditions, restrictions and easement
shall run with the Property and shall be binding on all parties having or acquiring any right, title or
interest in the Property or any part thereof (including each Parcel) and shall inure to the benefit of
each owner thereof and their successors and assigns, and are imposed upon the Property and every
part thereof (including each Parcel) as a servitude in favor of each and every Parcel as the dominant
tenement or tenements.
NOW, THEREFORE, THE DEVELOPER AGREES AND COVENANTS AS FOLLOWS:
A. Low or Moderate Income Restrictions
1. Number of Units.
Developer shall develop two (2) detached, single-family homes (the
"Restricted Units") within the Project Area and shall develop all on -site and off -site public
improvements connected therewith, all as described and set forth in the Scope of Development
(Attachment No. 1). Developer shall restrict each of the units for sale to a Low or Moderate Income
Household pursuant to the applicable income and affordability provisions contained herein. The
Developer further covenants and agrees that the above -referenced occupancy, ownership and
affordability requirements shall bind and be enforceable against the Site for the period of thirty (30)
years commencing with the acquisition of each respective parcel by the Developer with the
simultaneous recording of this document.
2. Definitions.
(a) "Affordable Housing Cost" shall be that purchase price which would
result in maximum monthly housing payments for a thirty (30) year mortgage for that portion of the
purchase price which is to be paid in the form of loan proceeds under currently prevailing mortgage
loan rates or the interest rate of any below -market mortgage program for which such purchaser has
obtained a first trust deed loan, for the low or moderate income group calculated pursuant to Health
and Safety Code Section 50052.5, which sets forth the following formula:
CONT.BDH 3
Lower Income Households - whose gross incomes exceed the maximum
income for very low income households and do not exceed seventy percent (70%) of the area median
income adjusted for family size, the product of thirty percent (30%) times seventy percent (70%) of
the area median income adjusted for family size appropriate for the unit. In addition, for any lower
income household that has a gross income that equals or exceeds seventy percent (70%) of the area
median income adjusted for family size, it shall be optional for any state or local funding agency to
require that affordable housing cost not exceed thirty percent (30%) of the gross income of the
household.
Moderate Income Households - not less than twenty-eight percent (28%) of
the gross income of the household, nor more than the product of thirty -five percent (35%) times the
greater of one hundred ten percent (110%) of area median income adjusted for family size
appropriate for the Affordable Unit, or the gross income of the household for households earning
greater than one hundred percent (110%) and not more than one hundred twenty percent (120%) of
the area median income adjusted for family size.
(b) "Affordability Period" shall be thirty (30) years from the date of
transfer to an Eligible Person or Family.
(c) "Eligible Person or Family" shall mean any person or family who
meets the income qualifications for Moderate Income Households.
(d) "Lower Income Household" shall mean a household earning not
greater than eighty percent (80%) of Riverside County median income, as determined by the United
States Department of Housing and Urban Development from time to time, as set forth in Health and
Safety Code Section 50093.
(e) "Moderate Income Household" shall mean a household earning not
greater than one hundred twenty percent (120%) of Riverside County median income, as determined
by the United States Department of Housing and Urban Development from time to time, as set forth
in Health and Safety Code Section 50093.
(f) "Owner" shall mean Developer and any successor in interest of
Developer to any lot of the Site except where a provision of this Agreement expressly excludes
Developer from the definition of owner.
(g) "Proposed Transferee" shall mean a person or family determined to
be an Eligible Person or Family to whom the Developer or any successor Owner desires and
nronoses to Transfer a Restricted Unit.
(h) "Purchase Housing Cost" or an Eligible Person or Family purchasing
a Restricted Unit shall include all of the following associated with that Restricted Unit, estimated
or known s of the date of their proposed sale of the Restricted Unit:
(I) Principal and interest on a mortgage loan including any
rehabilitation loans, and any loan insurance fees associated therewith.
CONT.BDH 4
property improvements.
(ii) Property taxes and assessments.
(iii) Fire and Casualty insurance covering replacement value of
(iv) Any homeowner association fees.
Monthly housing cost of a purchaser shall be an average of estimated costs for the next twelve (12)
months
(I) "Restricted Unit" shall mean a dwelling unit, which shall be a single-
family residence, subject to the restrictions of this Agreement (including, without limitation, this
document).
0) "Sales Price" shall mean all sums paid by a purchaser to a seller for,
or in conjunction with, the acquisition of a Restricted Unit, including the purchase price designated
in any purchase agreement, consideration for personal property and all other costs and fees paid by
the purchaser to or for the benefit of the seller.
(k) "Transfer" shall mean any sale, assignment, conveyance, lease or
transfer, voluntary or involuntary, of any interest in a Restricted Unit. Without limiting the
generality of the foregoing, Transfer shall include (I) a transfer by devise, inheritance or intestacy
to a party who does not meet the definition of Eligible Person or Family; (ii) a life estate; (iii)
creation of a joint tenancy interest; (iv) a gift of all or any portion of a Restricted Unit; or (v) any
voluntary conveyance of a Restricted Unit. Transfer shall not include transfer to a spouse in a
dissolution proceeding; however any subsequent Transfer shall be subject to this restriction.
(1) "Transferee" shall mean any natural person or entity who obtains
ownership or possessory rights in a Restricted Unit pursuant to a Transfer.
3. Sales of Restricted Units. Developer agrees that Developer shall sell each
Restricted Unit to an Eligible Person or Family at an Affordable Housing Cost (the "Developer
Conveyance") and that during the Affordability Period each subsequent resale of a Restricted Unit
by the then -Owner thereof shall be to an Eligible Person or Family at an Affordable Housing Cost.
Developer agrees that these Conditions, Covenants and Restrictions giving effect to the foregoing
restriction shall be recorded against each lot of the Site concurrently with the Acquisition Escrow.
Developer agrees to commence to market each Restricted Unit not later than the completion of
construction of each Restricted Unit; each Restricted Unit shall be sold to an Eligible Person or
Family prior to issuance of a Certificate of Completion as to any such Restricted Unit for purposes
of Section 322 of the Agreement.
For purposes of satisfying the requirement that all of the Restricted Units shall be
occupied by Eligible Persons or Families: (a) an individual or family who qualifies as an Eligible
Person or Family at the time he or she first takes title to a Restricted Unit will be deemed an Eligible
Person or Family as long as he or she continues to hold title to such Restricted Unit even though the
Eligible Person or Family subsequently ceases to meet the income or other requirements of an
Eligible Person or Family subsequently ceases to meet the income or other requirements of an
CONT.BDH
Eligible Person or Family, and (b) when an Owner releases title to a Restricted Unit, such unit will
be considered as occupied by an Eligible Person or Family if it is held vacant and available for such
occupancy until title is transferred to another Eligible Person or Family, at which time the status of
the new Owner as an Eligible Person or Family is to be determined.
4. Restrictions on Transfer by Sale of the Restricted Property or Any Restricted
Unit.
(a) For the duration of the Affordability Period, Developer, for itself and
any subsequent Owner, hereby subjects the Site to certain restrictions and limits the price at which
Developer or any other Owner may sell and/or resell the Site and the persons to whom Developer
or any other Owner may sell the Site.
(b) DEVELOPER AND ANY OTHER OWNER UNDERSTANDS
THAT THE DETERMINATION OF THE SALES PRICE CAN BE MADE ONLY AT THE TIME
OF THE PROPOSED TRANSFER, TAKING INTO CONSIDERATION INTEREST RATES,
PROPERTY TAXES AND OTHER FACTORS THAT CANNOT BE ACCURATELY
PREDICTED AND THAT THE SALE PRICE PERMITTED HEREUNDER MAY NOT
INCREASE OR DECREASE IN THE SAME MANNER AS OTHER SIMILAR REAL
PROPERTY WHICH IS NOT ENCUMBERED BY THIS RESTRICTION. DEVELOPER AND
ANY OTHER OWNER FURTHER ACKNOWLEDGE THAT, AT ALL TIMES IN SETTING THE
SALES PRICE, THE PRIMARY OBJECTIVE OF THE AGENCY AND THIS AGREEMENT IS
TO PROVIDE HOUSING TO ELIGIBLE PERSONS OR FAMILIES AT AFFORDABLE
HOUSING COST. THE SALES PRICE MAY BE LESS THAN OTHER SIMILAR PROPERTIES
WHICH HAVE NO RESTRICTIONS.
Developer's Initials
(c) Transfer of a Restricted Unit. Developer and any successor Owner
may transfer a Restricted Unit only in strict accordance with the provisions of this Agreement.
Specifically, during the Affordability Period, Owner may transfer a Restricted Unit (I) only to an
Eligible Person or Family and (ii) only if the Purchase Housing Cost does not exceed Affordable
Housing Cost for the Eligible Person or Family; and (iii) only if the Transfer has previously been
approved in writing by the Agency.
In order to comply with this Subsection 4(c), Developer and any successor
Owner must calculate the Affordable Housing Cost for the Proposed Transferee of the Restricted
Unit in accordance with the definition set forth in Subsection 2(a) of this Section . After
calculating the Affordable Housing Cost for the Proposed Transferee, the Owner must ensure that
the sum of the Sales Price and all costs listed in the definition of Purchase Housing Cost set forth
in Subsection 2 of Section 401 does not exceed that Affordable Housing Cost. The Calculation of
the Sales Price under this Subsection 4(c) is illustrated by example in Attachment No. — of the
Agreement.
CONT.BDH 6
(d) In the event that after a good faith effort as defined in the Buyer
Promissory Note, the successor Owner is unable to obtain an Eligible Person or Family to transfer
the Restricted Unit, then after the required notice to and approval by the Agency Executive Director
the owner may sell the Restricted Unit to a noneligible party subject to the equity share provisions
of the Buyer Promissory Note and the Covenants, Conditions and Restrictions would be released.
(e) Notwithstanding anything to the contrary in this Section _, at close
of the Developer Conveyance Escrow transferring the Restricted Unit from the Developer to the
Proposed Transferee (the "Initial Owner"), the Initial Owner shall execute a Buyer's Promissory Note
as approved by the Executive and Agency Counsel which Promissory Note shall be secured by a
Second Deed of Trust. The Buyer's Promissory Note shall be non -interest bearing. The principal
amount shall be equal to the amount of the Agency Assistance necessary for the Individual or Family
to qualify for the Lender's loan and ensure the affordability requirements are met as approved by the
Executive Director in accordance with the Agency's affordable housing program policies. The Note
Amount shall be due and payable according to its terms including any applicable equity sharing
provision. However, should the Initial Owner transfer the Restricted Unit to an Eligible Person,
Family at Affordable Housing Cost, the Transferee shall assume the Promissory Note (Attachment
No. 8 to the Agreement) and Agency shall extend the due date of the Note Amount until the next
Transfer of the Restricted Unit. The foregoing provisions will apply to every successive Transfer
during the Affordability Period.
5. Process to Complete Transfer by Sale of Restricted Units. Upon the Transfer
by sale of a Restricted Unit, the following procedures shall apply:
(a) Notice to City: Owner shall send to the Agency in care of the La
Quinta Housing Department (or its successor), at P.O. Box 1504, La Quinta, California 92253, the
form attached hereto as Attachment No. _ fully completed and executed by the Owner and the
Proposed Transferee (the "Approval Request").
(b) Qualification of Proposed Transferee. No Transfer shall occur unless
and until determination is made based o the Certificate in the form of Attachment No. _ attached
hereto ("Certificate") and attachments thereto, that the Proposed Transferee (I) intends to occupy the
Restricted Unit as the Proposed Transferee's principal residence and (ii) is an Eligible Person or
Family. Each Proposed Transferee shall submit a Certificate to the Developer certifying its intent
with regard to the occupancy of the Restricted Unit and as to the truth and accuracy of all
information supplied as to the Gross Income (calculated as set forth in 25 Cal. Code of Regs.,
Section 6914) of the Proposed Transferee ("Proposed Transferee's Certificate"). Developer or
subsequent owner shall certify pursuant to Attachment No. 13 hereof the information provided on
the Proposed Transferee's Certificate pursuant to direction on that Certificate. Developer or
subsequent owner shall be entitled to rely on the information on the Proposed Transferee's Certificate
and attachments thereto in making the determination required by this subsection 5(b) unless the
Developer or subsequent owner has knowledge of, or a reasonable basis for belief as to the
inaccuracy or falsehood of the Proposed Transferee's Certificate.
CONT.BDH 7
(c) The Sales Price for the Restricted Unit shall not exceed the maximum
price at which the Purchase Housing Cost to be paid by the Proposed Transferee would not exceed
Affordable Housing Cost. The calculation of the Sales Price under this subsection is illustrated by
example in Attachment No: 13 attached hereto. However, in determining Affordable Housing Cost,
the family size of the Proposed Transferee shall be deemed to be persons in the case of a 1 bedroom,
3 persons for a 2 bedroom, 4 persons for a 3 bedroom, or 5 persons for a 4 bedroom Restricted Unit.
If the actual family size of the Proposed Transferee is larger, then the actual family size shall be used.
(d) Certificates from Parties. With respect to each sale of a Restricted
Unit, Developer or subsequent owner shall submit to the Agency, not later than four (4) weeks prior
to close of escrow on the sale of a Restricted Unit, a certificate that (I) the Developer or subsequent
owner has made the affirmative determinations required by Section 4(a) above and (ii) the Sales
Price conforms with Section 4(b) above. The Developer or subsequent owner shall concurrently
submit to the Agency the Proposed Transferee's Certificate and all attachments thereto and all other
documents or material with regard to information required by Sections 4(a) and/or (b) above,
whether or not relied on by the Developer. Further, the Developer or subsequent owner and
Proposed Transferee each shall certify in writing, in a form acceptable to the Agency, that the
Transfer shall be closed in accordance with, and only with, the terms of the sales contract and other
documents submitted to and approved by the Agency and that all consideration delivered by the
Proposed Transferee to Developer or subsequent owner has been fully disclosed to the Agency. The
written certificate shall also include a provision that, in the event a Transfer is made in violation of
the terms of this Agreement or false or misleading statements are made in any documents or
certificate submitted to the Agency for its approval of the Transfer, the Agency shall have the right
to file an action at law or in equity to seek termination and/or rescission of the sales contract and/or
declare the sale void, notwithstanding the fact that the Transfer may have closed and become final
as between Developer or subsequent owner and its Transferee. In the event Developer for the initial
transfer or subsequent owner for each following transfer fails to comply with Sections 4(a) or 4(b)
above, any costs, liabilities or obligations incurred by the Developer or subsequent owner and its
Transferee for the return of any monies paid or received or for any costs and legal expenses, shall
be borne Jointly and severally by the Developer and its transferee and such parties shall hold the City
and Agency harmless and reimburse their expenses, legal fees and costs for any action and City
and/or Agency take in enforcing the terms of this Section
(e) Execution of Promissory Note and Second Deed of Trust.
Notwithstanding anything to the contrary in this Agreement, at close of Escrow of the sale of the
Housing Unit from the Developer to the Buyer, the Buyer shall execute a Buyer Promissory Note
which shall be secured by a Second Deed of Trust. Said Second Deed of Trust shall be subordinate
to any mortgage(s) obtained by the Owner for the purpose of securing funds to be applied to the
Sales Price of the Housing Unit. the Buyer Promissory Note shall be non -interest bearing. The
principal amount of the Promissory Note shall be an amount equal to the amount actually given as
cash plus an Agency Equity Share Amount which becomes applicable only in the event that the
Buyer is unable after good faith efforts to find an Eligible Person or Family to transfer the home at
Affordable Housing Cost. In the event that the Buyer has provided the Agency with evidence of
their good faith efforts then Agency may approve the sale to a nonqualified buyer and release the
covenants by receiving in addition to the cash amount originally provided the additional Agency
Equity Amount as provided under the terms of the Buyer Promissory Note.
CONT.BDH 8
So long as the Transferee purchasing the Housing Unit from the Owner is an Eligible
Person or Family and the Sale of the Housing Unit is made at a price which is not in excess of
Affordable Housing Cost, the Transferee shall assume the obligations of the Owner under the
Promissory Note and Second Deed of Trust to repay the Agency Equity pursuant to the Promissory
Note by execution of an assumption agreement in the form set forth as Attachment No. — of this
Agreement, together with other written documentation satisfactory to the Agency, and Agency shall
extend the due date of the Agency Equity pursuant to the Note Amount until the next Transfer of the
Housing Unit by said Transferee. At such next Transfer, the Agency will again extend the due date
of the Agency Equity pursuant to the Note Amount if the Sale or Transfer complies with the
requirements of this Section. So long as each Transferee from the Owner and each subsequent
Owner: (1) is an Eligible Person or Family, (2) acquires the Housing Unit at an Affordable Housing
Cost, and (3) assumes the obligations of the predecessor Owner as aforesaid; then the Agency agrees
to extend the due date of the Agency Equity pursuant to the Note Amount and the transferring Owner
shall not be required to pay the Agency Equity potion of the Note Amount upon transfer of the
Housing Unit.
The Agency Equity payment requirement is intended as a penalty against the Owner,
to capture a portion of the equity in the Restricted Property for the benefit of the Agency/Holder, in
the event that the Owner makes a ale of the Restricted Property to a Buyer that is not an Eligible
Person or Family. This equity recapture requirement is intended to be a cumulative remedy, together
with all other remedies available to the Agency/Holder to compensate for the removal of the
affordable housing covenants of the Grant Deed and this Agreement on the Housing Unit, to
compensate the Agency for the administrative costs of operating the housing program of the Agency
and to provide funds to the Agency to further assist low and moderate income persons in the
provision of housing. In the event the equity recapture provisions of the Promissory Note are found
by a court or administrative agency of competent jurisdiction to be in contravention of law or
administrative regulation, the Applicable Percentage shall be reduced to the maximum percentage
allowable by applicable law or administrative regulation, or may be otherwise modified by judicial
decree or order so as to comply with applicable law.
(f) Written Consent of Agency Required Before Transfer. During the
Affordability Period the Restricted Property or the Restricted Unit, as the case may be, and any
interest therein, shall not be conveyed by any Transfer except with the express written consent of the
Agency, which consent shall be given only if the Transfer is consistent with the Agency's goal of
creating, preserving, maintaining and protecting housing in the City of La Quinta for Eligible Persons
and Families and shall be in accordance with the provisions of this subsection 5. This provision shall
not prohibit the encumbering of title for the sole purpose of securing financing of the purchase price
of the Restricted Unit.
(g) Delivery of Documents. Upon the close of the proposed Transfer, the Owner
and Transferee, as applicable, shall provide the Agency with a certified copy of the recorded
Assumption Agreement, a copy of the final sales contract, settlement statement, escrow instructions,
all certificates required by this subsection 5 and any other documents which the Agency may request.
CONT.BDH 9
6. Covenants of Owner. The Owner of each Restricted Unit by acceptance of
a deed to the Restricted Unit covenants and agrees that, at all times during the Affordability Period,
its Restricted Unit will be continuously occupied by Owner as its principal residence, and shall not
be rented, subleased, or subject to any other business arrangement, whereby consideration shall be
paid by any occupant of a Restricted Unit to the Owner of the Restricted Unit; provided, if the
Restricted Unit is occupied by an Eligible Person or Family, the family. members whose income was
considered in determining the eligibility of that family may make monetary contributions toward the
Purchase Housing Costs of the Restricted Unit. Owner agrees that it shall not record or cause the
recordation of any deed of trust (a "Further Encumbrance") securing a note having an original
principal sum which, when added to the sum of the principal amount(s) of any notes secured by any
deeds of trust against the Restricted Property as of the date of recordation of the Further
Encumbrance, exceeds the fair market value of the Restricted Property.
B. Use Restrictions. The Property shall be occupied and used as follows:
1. The single-family home on each Parcel ("Unit") shall be used only for private
dwelling purposes and for no other purposes. The Units shall not be leased, subleased, rented or
otherwise; rather, each Unit shall be the principal dwelling of the owner thereof and his family.
2. There shall be no structural alternation, construction or removal of any
structure on any Parcel (other than repairs or rebuilding permitted herein) without the approval of
the appropriate City departments or the Agency and in conformance with the City Code.
C. Maintenance. The exterior areas of each Parcel shall be kept free of rubbish, debris
and other unsightly or unsanitary materials.
Each Owner shall have the affirmative obligation to prevent the occurrence on the
Parcel owned by such Owner of what might be considered a fire hazard or a condition dangerous to
the public health, safety and general welfare; or constitute an unsightly appearance or otherwise
detract from the aesthetic and property values of neighboring properties. The following minimum
performance standards for the maintenance of the Unit and landscaping on each Parcel shall be
adhered to by each Owner.
(1) Landscaping on the Property shall be absent of the following:
(a) Lawns with grasses in excess of six (6) inches in height.
(b) Untrimmed hedges.
(c) Dying trees, shrubbery, lawns and other plant lift from lack of water
or other necessary maintenance.
(d) Trees and shrubbery grown uncontrolled without proper pruning.
CONT.BDH 10
(e) Vegetation so overgrown as to be likely to harbor rats or vermin.
(f) Dead, decayed or diseased trees, weeds and other vegetation.
(g) Inoperative irrigation system(s).
(2) Yard areas shall be maintained so as to be absent of the following:
(a) Broken or discarded furniture, appliances and other household
equipment stored in yard areas for periods exceeding one (1) week.
(b) Packing boxes, lumber, trash, dirt and other debris stored in yards for
unreasonable periods in areas visible from public property or
neighboring properties.
(3) No building, wall or fence may be left in an unmaintained condition so that
any of the following exist:
(a) Buildings abandoned, boarded up, partially destroyed or left
unreasonably in a state or partial construction.
(b) Unpainted buildings or buildings with peeling paint in such a
condition as to
I. Cause dry rot, warping and termite infestation; or
ii. Constitute an unsightly appearance that detracts form the
aesthetic or property values of neighboring properties.
(c) Broken windows, constituting hazardous conditions and/or inviting
trespassers and malicious mischief.
(d) Damaged garage doors that may become inoperative or unsafe to
operate.
(e) Graffiti remaining on any portion of the property for a period
exceeding ten (10) days.
(f) Building interiors and exteriors shall be maintained to meet standards
of similar residential property in the City of La Quinta.
D. City's Right of Review and Enforcement.
The City of La Quinta (the "City") and the Agency shall be made a party to this
Declaration for the limited purpose as specified herein as follows:
CONT.BDH 11
1. Changes or amendments to this Declaration must be submitted for
City/Agency review and approval.
2. In the event of inaction by any Owner, the City and Agency are hereby granted
expedient power to enforce all provisions of this Declaration including, but not limited to, the
maintenance of the Improvements and all yards, buildings and landscaping areas within the Site.
E. Miscellaneous Provisions.
1. If any provision of this Declaration or portion thereof, or the application to
any person or circumstances, shall to any extent be held invalid, inoperative or unenforceable, the
remainder of this Declaration, or the application of such provision or portion thereof to any other
persons or circumstances, shall not be affected thereby; it shall not be deemed that any such invalid
provision affects the consideration for this Declaration; and each provision of this Declaration shall
be valid and enforceable to the fullest extent permitted by law.
2. This Declaration shall be construed in accordance with the laws of the State
of California.
3. This Declaration shall be binding upon and inure to the benefit of the
successors and assigns of the Developer.
4. In the event action is instituted to enforce any o the provisions of this
Declaration, the prevailing party in such action shall be entitled to recover fro the other party thereto
as part of the judgment, reasonable attorney's fees and costs.
F. The covenants and agreements established in this Declaration shall, without regard
to technical classification and designation, be binding on each Owner and any successor in interest
to the Property, or any part thereof (including each Parcel) for the benefit of and in favor of the
Agency, its successor and assigns, and the City of la Quinta, and shall remain in effect for thirty (30)
days from the date of the recording of this document).
IN WITNESS WHEREOF, Owner has executed this instrument the day and year first
hereinabove written.
Dated:
BUILDING HORIZONS, INC., a California
corporation
By:
Its:
"OWNER"
CONT.BDH 12
EXHIBIT "A" TO
ATTACHMENT NO. 5
THE PROPERTY
(To Be Inserted)
CONT.BDH 13
ATTACHMENT NO. 6
CERTIFICATE OF COMPLETION
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
LA QUINTA REDEVELOPMENT AGENCY
78-495 Calle Tampico
La Quinta, California 92253
Attn: Executive Director
Space above for Recorder's use.
CERTIFICATE OF COMPLETION OF CONSTRUCTION AND DEVELOPMENT
WHEREAS, by an Affordable Housing Agreement dated , 1998, by and between
the LA QUINTA REDEVELOPMENT AGENCY, a public body, corporate and politic (hereinafter
referred to as the "Agency") and BUILDING HORIZONS, INC. (collectively referred to as the
"Developer"), the Developer has constructed improvements upon the real property (the "Site"),
legally described on the attached Exhibit A, by constructing or causing to be constructed the
improvements thereon according to the terms and conditions of said Affordable Housing Agreement
(the "Agreement"); and
WHEREAS, pursuant to Section 314 of the Agreement, promptly after completion of the
Improvements the Agency shall furnish the Developer with a Certificate of Completion upon written
request therefor by the Developer; and
WHEREAS, the issuance by the Agency of the Certificate of Completion shall be conclusive
evidence that the construction of the Improvements conforms to the Agreement; and
WHEREAS, the Developer has requested that the Agency furnish the Developer with the
Certificate of Completion; and .
WHEREAS, the Agency has conclusively determined that the construction of the
Improvements conforms to the Agreement;
NOW, THEREFORE:
1. As provided in the Agreement, the Agency does hereby certify that the construction
of the Improvements required to be constructed on the Site described in Exhibit "A" hereto has been
satisfactorily performed and completed, and that such development an construction work complies
with the Agreement.
CONT.BDH I
2. This Certificate of Completion does not constitute evidence of compliance with or
satisfaction of any obligation of the Developer to any holder of a mortgage or any insurer of a
mortgage security money loaned to finance the work of construction if improvements and
development of the Site, or any part hereof. This Certificate of Completion is not a notice of
completion as referred to in Section 3093 of the California Civil Code.
3. This Certificate of Completion does not denote completion of any work required to
be completed, other than on the Site.
4. The Deed of Trust recorded as document no. among the official land records
of the County of Riverside and those Conditions, Covenants and Restrictions recorded as Document
No. among the official land records of the County of Riverside shall remain in full force and
effect.
IN WITNESS WHEREOF, the Agency has executed this Certificate as of this _ day of
. 1998.
LA QUINTA REDEVELOPMENT AGENCY
THOMAS P. GENEVESE, Executive Director
ATTEST:
SAUNDRA L. JUHOLA, Agency Secretary
CONT.BDH 2
NOTARY
CONT.BDH
ATTACHMENT NO. 7
MAXIMUM SALES PRICE ILLUSTRATION
[This shall be prepared when Developer ready to
start sales of units]
CONT.BDH
ATTACHMENT NO. 8
CERTIFICATE OF PROPOSED TRANSFEREE
THIS FORM MUST BE DELIVERED TO THE OWNER BEFORE PROCEEDING WITH ANY
TRANSFER OF THE PROPERTY.
,19
1. The Proposed Transferee is
Names:
Current
Address:
Telephone Number:
2. The address of the property which the proposed transferee desires to purchase is
(the "Property"), which wasbuilt
in the La Quinta Redevelopment Project Area No. 1.
3. The proposed transferee represents, warrants and covenants the following:
(a) The proposed transferee has never previously owned a single-family home.
(b) The Property will be the principal residence of the proposed transferee.
(c) The combined maximum annual income in the current year for all household
members of the proposed transferee is $ (This figure must reflect income form
all sources.)
(d) The proposed transferee will deliver to the Agency a signed financial statement on
a form acceptable to the Agency.
4. The proposed transferee's household consists of the following persons who will reside in the
Property:
CONT.BDH I
Adults (18 or over) - [name of each]:
Minors (under 18) [name of each]:
5. The proposed transferee must submit to the Owner, on a form available from the Owner, an
income certification so the Owner may determine if the proposed transferee is an Eligible Person or
Family.
6. A true and correct copy of the proposed transferee's most recent tax return to the U.S. Internal
Revenue Service is attached hereto.
7. The terms of the proposed transfer are:
(a) Sales price of $ . This sales price is based on the maximum price at
which the Purchase Housing Cost of the Proposed Transferee would not exceed Affordable Housing
Cost. The calculation of the Sales Price under this section is illustrated in Attachment No. _ to
the Agreement.
IN ORDER TO ANSWER QUESTION 2(b) YOU MUST CALCULATE THE PROPOSED
SALES PRICE BASED ON AFFORDABLE HOUSING COST, TAKING INTO
CONSIDERATION ALL ITEMS LISTED IN THE DEFINITION OF PURCHASE HOUSING
COST.
(b)
Price of any personal property being sold by the Owner to the proposed transferee:
(if none, so state)
(c) The price of $
of Owner. (If no, so state).
to be paid by the proposed transferee for any services
(d) All other amounts of money or other consideration, if any, concerning the Property
or any other matter to be paid by the proposed transferee to the Owner: $ (if none, so state).
(e) Sources of payment of sales price:
Sales price $
Cash down payment $
CONT.BDH 2
I st loan $
2nd loan $
Other (describe) $
Total $
(f) The financing obtained by the proposed transferee to purchase the Property is as
follows:
1st Loan:
Loan amount: $
Monthly payments: $
Interest rate
If variable interest, describe adjustment mechanism:'
Due date:
Balloon payment amount:
Points and fees:
Lender:
Lender's address:
2nd Loan:
Loan amount: $
Monthly payments: $
Interest rate
If variable interest, describe adjustment mechanism:
CONT.BDH 3
Due date:
Balloon payment amount:
Points and fees:
Lender:
Lender's address:
Other Loans: (describe, if none, so state)
(g) The monthly Purchase Housing Cost to be paid by the proposed transferee:
1 st loan monthly payment:
2nd loan monthly payment:
Other loans monthly payment:
Taxes and assessments (1/12 of
yearly taxes and assessments):
Insurance (1/12 of yearly
premium):
Homeowner's dues:
Total:
8. A true and correct copy of the purchase and sale or other agreement between the owner and
the proposed transferee is attached hereto.
I declare under penalty of perjury under the laws of the State of California that the foregoing
is true and correct.
PROPOSED TRANSFEREE:
Date
CONT.BDH 4
signature
signature
print name print name
street address telephone
City state zip code
CONT.BDH
Developer's Certification
Based on the Proposed Transferee's Certificate above, and all documents attached hereto, Developer
hereby certifies that:
(1) Proposed Transferee is an Eligible Person or Family; and
(2) The monthly Purchase Housing Cost to be paid by the Proposed Transferee shall not
exceed the monthly Affordable Housing Cost.
[Capitalized terms used above are defined in the Agreement to which this certificate is
attached.]
OWNER:
[Name]
Date:
CONT.BDH 6
ATTACHMENT NO. 9
NOTICE OF INTENT TO TRANSFER
NOTICE OF INTENT TO TRANSFER MUST BE DELIVERED TO
THE LA QUINTA REDEVELOPMENT AGENCY PRIOR TO
PROCEEDING WITH ANY TRANSFER OF THE PROPERTY.
From:
To: La Quinta Redevelopment Agency
c/o City of La Quinta
Housing Department
La Quinta, CA 92253
Attn: Development Officer
Re:
La Quinta, CA (the "Property")
Redevelopment Project Area
(street address)
("Owner")
Owner desires to [sell, convey, transfer by inheritance or devise, lease, gift, otherwise
transfer] (circle appropriate words) the Property.
If the Agency has a program to help locate an Eligible Family, does the Owner want the
Agency to help look for an Eligible Person or Family to buy the Property?
Yes
No
Date:
Signature of Owner
U
Day time telephone of Owner
Date:
Signature of Owner
Day time telephone of Owner
CONT.BDH I
ATTACHMENT NO. 10
REQUEST FOR APPROVAL OF PROPOSED TRANSFEREE
THIS FORM MUST BE DELIVERED TO THE LA QUINTA REDEVELOPMENT AGENCY
BEFORE PROCEEDING WITH ANY TRANSFER OF THE PROPERTY
19
La Quinta Redevelopment Agency
c/o City of La Quinta
78-495 Calle Tampico
La Quinta, CA 92253
Attn: Development Officer
Redevelopment Project Area
Re: Request for Approval of Proposed Transferee
To Whom It May Concern:
The undersigned is the owner of real property in La Quinta, located at
(the "Property"), which was built
within the Redevelopment Project Area.
, The Owner now desires to transfer the Property and by this letter is requesting the City of La
Quinta to approve the proposed transferee.
1. The Proposed Transferee is
Names:
Current
Address:
Telephone Number:
CONT.BDH I
2. The terms of the proposed transfer are
(a) Sales price of $ . This sales price is based on the lesser of
(I) Fair market value; or
(ii) The maximum price at which the Purchase Housing Cost of the
Proposed Transferee would not exceed Affordable Housing Cost.
The calculation of the Sales Price under this subsection (ii) is
illustrated in Attachment No. _ to the Agreement.
IN ORDER TO ANSWER QUESTION 2(b) YOU MUST CALCULATE THE PROPOSED
SALES PRICE BASED ON AFFORDABLE HOUSING COST, TAKING INTO
CONSIDERATION ALL ITEMS LISTED IN THE DEFINITION OF PURCHASE HOUSING
COST.
(b) Price of any personal property being sold by the Owner to the proposed transferee:
$ (If none, so state)
(c) The price of $_
of Owner. (If none, so state).
to be paid by the proposed transferee for any services
(d) All other amounts of money or other consideration, if any, concerning the Property
or any other matter to be paid by the proposed transferee to the Owner: $ (if none, so state).
(e) Sources of payment of sales price:
Sales price $
Cash down payment $
1 st loan $
2nd loan $
Other (describe) $
Total $
(f) The financing obtained by the proposed transferee to purchase the Property is as
follows:
CONT.BDH 2
I st Loan:
Loan amount: $
Monthly payments: $
Interest rate
If variable interest, describe adjustment mechanism:
Due date:
Balloon payment amount:
Points and fees:
Lender:
Lender's address:
2nd Loan:
Loan amount: $
Monthly payments: $
Interest rate
If variable interest, describe adjustment mechanism:
Due date:
Balloon payment amount:
Points and fees:
Lender:
Lender's address:
CONT.BDH 3
Other Loans: (describe, if none, so state)
(g) The monthly Purchase Housing Cost to be paid by the proposed transferee:
1 st loan monthly payment:
2nd loan monthly payment:
Other loans monthly payment:
Taxes and assessments (1 / 12 of
yearly taxes and assessments):
Insurance (1 / 12 of yearly
premium):
Homeowner's dues: $
Total: $
3. The proposed transferee represents, warrants and covenants the following:
(a) The Property will be the principal residence of the proposed transferee.
(b) The combined maximum annual income for all household members of the proposed
transferee is $ . (This figure must include at sources of income).
(c) The proposed transferee will deliver to the Agency a signed financial statement on
a form acceptable to the Agency.
4. The proposed transferee's household consists of the following persons who will reside in the
Property:
Adults (18 or over) - [name of each]:
CONT.BDH 4
Minors (under 18) [name of each]:
5. The proposed transferee must submit to the Owner, on a form available from the Owner, an
income certification so the Owner may determine if the proposed transferee is an Eligible Person or
Family.
6. A true and correct copy of the proposed transferee's most recent tax return to the U.S. Internal
Revenue Service is attached hereto.
7. A true and correct copy of the purchase and sale or other agreement between the owner and
the proposed transferee is attached hereto.
I declare under penalty of perjury under the laws of the State of California that the foregoing
is true and correct.
OWNER:
Date
signature
print name
street address telephone
City state zip code
signature
print name
CONT.BDH 5
PROPOSED TRANSFEREE:
Date
signature
print name
street address telephone
City state zip code
signature
print name
CONT.BDH
ATTACHMENT NO. 1 I
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
LA QUINTA REDEVELOPMENT AGENCY )
78-495 Calle Tampico )
La Quinta, California 92253 )
Space above for recorder.
ASSUMPTION AGREEMENT
This Assumption Agreement is entered into by:
The La Quinta Redevelopment Agency ("Agency")
Date of Agreement:
FACTS
("Selling Owners")
('Buying Owners")
A. Selling Owners are all of the owners of property commonly known as
, La Quinta, California (the "Property") and more particularly
described in Exhibit A attached hereto and incorporated herein by reference.
B. The Property is subject to the Affordable Housing Agreement between the Agency
and Building Horizons, Inc., a California nonprofit public benefit corporation, dated as of
(the "Agreement", a copy of which is on file with the Agency as a public
record and is incorporated herein by reference, the Grant Deed recorded at Book , Page Series
M of the official land records of Riverside County (the "Grant Deed"), and that certain
Second Deed of Trust recorded at Book , Page _, Series No. of the official land records
of Riverside County (the "Deed of Trust", and those Conditions, Covenants and Restrictions,
recorded at Book , Page , Series No. _ of the Official Records of Riverside County (the
"Restriction"). The Agreement, the Deed of Trust, and the Restriction restricts the sales price that
can be charged for the Property and the persons to whom the Property can be sold.
CONT.BDH
C. Buying Owners desire to purchase the Property. Buying Owners understand that the
Restriction will limit the purchase price they can receive when they sell the Property and will limit
the people to whom they can sell the Property.
D. Buying Owners are able to purchase the Property because the purchase price of the
Property may be less than other similar property without Restrictions. For this reason Buying
Owners desire to purchase the Property.
E. In order to purchase the Property, Buying Owners must assume all obligations of the
Owner under the Agreement, the Deed of Trust, and the Restriction and must agree to bound by al
provisions in the Restriction.
NOW, THEREFORE, Buying Owners agree as follows:
1. Acknowledgment of Limitation on Future Price. BUYING OWNERS
UNDERSTAND THAT WHEN BUYING OWNERS DESIRE TO SELL OR TRANSFER THE
PROPERTY THAT THE ALE PRICE CAN BE DETERMINED ONLY AT THE TIME OF THE
PROPOSED TRANSFER TAKING INTO CONSIDERATION INTEREST RATES, PROPERTY
TAXES AND OTHER FACTS THAT CANNOT BE PREDICTED ACCURATELY AND THAT
THE SALES PRICE MAY NOT INCREASE OR DECREASE IN THE SAME MANNER AS
OTHER SIMILAR PROPERTY THAT IS NOT ENCUMBERED WITH THE AGREEMENT, THE
DEED OF TRUST, AND THE RESTRICTION, BUYING OWNERS ALSO ACKNOWLEDGE
THAT ALL TIMES IN SETTING THE SALES PRICE THE PRIMARY OBJECTIVE OF THE
AGENCY AND THE RESTRICTION IS TO PROVIDE HOUSING TO ELIGIBLE PERSONS OR
FAMILIES AT AFFORDABLE HOUSING COST. THE SALE PRICE, WHEN BUYING
OWNERS DECIDE TO SELL THE PROPERTY, WILL LIKELY BE LESS THAN OTHER
SIMILAR PROPERTIES WHICH HAVE NO RESTRICTIONS.
Buyer's Initials
2. Understand the Agreement. the Deed of Trust, and the Restriction. Buying Owners
represent that they have read the Restriction and fully understand the Agreement, the Deed of Trust,
and the Restriction.
3. Owner Occupancy. Buying Owners agree that they will occupy the Property as their
primary residence and that they will comply with all provisions of the Agreement, the Deed of Trust
and the Restriction relating to the occupancy of the Property.
4. Assumption of Obligations Under the Agreement the Deed of Trust and the
Restriction. As a material consideration to the Agency in approving Buying Owners, Buying Owners
hereby assume al obligations of the Owner (as defined in the Agreement, the Deed of Trust, and the
Restriction), related to the Property set forth in the Agreement, the Deed of Trust, and the
Restriction. Buying Owners agree to be bound by all duties and obligations of the Owner in the
Agreement, the Deed of Trust, and the Restriction and agree to comply with all provisions thereof
CONT.BDH 2
for the term of the Agreement, the Deed of Trust and the Restriction. Buying Owners agree as set
forth above in order to have the benefit of the restricted purchase price for which the Property is
offered.
5. Remedies. Upon the occurrence of an Event of Default, the Agency shall have the
following remedies:
(a) Specific Performance. The Agency shall have the right to bring an action for
specific performance of this Agreement to require the Developer to comply whit the terms and
provisions of this Agreement. Developer acknowledges that it is the intention of Developer and the
Agency that these provisions be specifically enforceable to maintain the supply of affordable housing
for Eligible Persons and Families.
(b) Application to Court. The Agency may apply to a court of competent
jurisdiction for an injunction prohibiting a proposed Transfer in violation of this Agreement, for a
declaration that a Transfer is void or for any other such relief as may be appropriate.
(c) All Remedies Available and Cumulative. Upon the occurrence of an Event
of Default, the Agency shall have the right to exercise all the rights and remedies, and to maintain
any action at law or suits in equity or other real property proceedings, to enforce the provisions of
this Assumption Agreement, the Agreement, the Restriction and the Deed of Trust, and to cure any
Event of Default or violation hereof. No delay in enforcing the provisions thereof as to any Event
of Default or violation shall impair, damage or waive the right of the Agency to enforce the
provisions of this Agreement in the future or any continuing or new breach or violation of any of the
covenants or restrictions contained in this Assumption Agreement, the Agreement, the Restrictions,
and the Deed of Trust. All rights and remedies, including without limitation those set forth in
Section (a) above, of any party legally entitled to enforce this Assumption Agreement, the
Agreement, the Restrictions, and the Deed of Trust, shall be cumulative and the exercise of any such
right or remedy shall not impair or prejudice and shall not be a waiver of the right to exercise any
other such right and remedy.
IN WITNESS WHEREOF, the parties have executed this Assumption Agreement to be
effective on the date of recordation of a deed conveying the Property to Buying Owners.
Date
Date
Buying Owner
Buying Owner
Based on information provided by Selling Owners and Buying Owners and on Buying
Owners execution hereof, the La Quinta Redevelopment Agency hereby approves Buying Owners
to purchase the Property subject to this Agreement.
CONT.BDH 3
LA QUINTA REDEVELOPMENT AGENCY
Date
Name:
Title:
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