The URL can be used to link to this page

Home My WebLink AboutAffordable Housing AgreementRECORDING REQUESTED �4: FIRST t�NIERIC,�\ TITLE COMPANY is document the enefit of the City of Arroyo Grande nd is exempt from recording fees ursuant to Government Code Sect 103 and 27383. :ORDING REQUESTED B� of Arroyo Grande ✓HEN RECORDED MAIL TO: ity of Arroyo Grande ommunity Development Director 14 East Branch Street .O. Box 550 rrovo Grande. CA 93421 .,� ; j� O JULIE RODEWALD San Luis Obispo Counry—Clerk/Recorder Necordetl at ihe repuest of First American Title Company DOC# I IIII II II 2006086702 IIIIIIIIIIIIII III _ 1_ DG 12/08120�6 8:07 AM Ti[les: 1 Pages: 3$ Fees 0.00 Taxes 0.00 ome�s o.00 PAID $0.00 AFFORDABLE HOUSING AGREEMENT WHEREAS, THIS AGREEMENT is made and entered into this Z�i�day of November, 2006, by and between the CITY OF ARROYO GRANDE, a municipal corporation (the "City"), and Vista Roble LLC, a California limited liability company, whose principal offices are located at 139 W. Branch, Arroyo Grande, California (collectively the "Developer"), collectively referred to as "the Partie.s'; and WHEREAS, Developer is the owner and developer of approximately 29.46 acres of real property that is described in the attached Exhibit A(the "Property"); and WHEREAS, Developer proposes to develop and construct fifteen (15) residential units and associated improvements, (the "ProjecY'), on the above-described Property, and to set aside Lots 16 through 19, inclusive, of the Property for future development of four (4) moderate-income units; and WHEREAS, Lots 16 through 19 are required to include four (4) moderate-income affordable housing unit(s) (collectively, the "Affordable Units") pursuant to the Conditions for Approval for Resolution No. 3732 (Vesting Tentative Tract Map Case No. 02-005); and WHEREAS it is the intention of Developer and the City to set forth in greater detail and specificity within this separate document the terms and conditions for producing and selling affordable ownership housing within the Project; and WHEREAS, it is the intention of Developer and the City that this Agreement run with the title of the Property and be binding on all parties that have or will acquire any right, title, or interest in said Property prior to the sale of the Affordable Units to individual home buyers. Affordable Housing Agreement � Grace Iane Residrntial Subdivision Page 1 November 2006 � `.r NOW, THEREFORE, in consideration of the foregoing, and of the mutual terms and covenants hereinafter set forth, the parties hereby agree that Developer shall produce and sell Affordable Units as described in this Agreement. 1.0 Definitions. Depending upon their context, certain words and phrases used in this Agreement shall have the same meaning as the definitions that are included in the Affordable Housing Ordinance. Other words and phrases used in this Agreement shall have the meanings that are defined below: 1.1 "Above Moderate Income" means Above Moderate Income as defined in the Affordable Housing Ordinance. 1.2 "Administering Agency" means the San Luis Obispo Housing Authority, or any other agency as determined by the City Council, which has experience in the administration of affordable housing programs. 1.3 "Affordable Housing Ordinance" means Chapter 16.80 of the Arroyo Grande Municipal Code as adopted by the Arroyo Grande City Council by Ordinance No. 514 C.S. on March 31, 2000. 1.4 "Affordable Unit(s)" means, depending upon the context, means either one or more of the affordable ownership housing units, the development and sale of which are regulated by this Agreement. 1.5 "AgreemenY' means this Affordable Housing Agreement. 1.6 "Eligible Purchaser" means a household that is qualified by the Administering Agency as meeting the requirements of this Agreement for the purchase of an Affordable Unit. 1.7 "Maximum Allowable Sales Price" means the maximum price at which an Affordable Unit may be sold under the Affordable Housing Ordinance. The Maximum Allowable Sale Price established for each Affordable Unit is the absolute maximum price that the Developer or individual may charge for the unit or may receive as compensation for the unit. The Developer or individual owner may not charge or receive any additional amount or compensation for an Affordable Unit regardless of whether the additional amount is 1) for options, upgrades or additional improvements to the unit, 2) paid through escrow or outside of escrow, 3) paid prior to, after or as part of the purchase escrow or 4) paid in cash or in kind. 1.8 "Median Income" means the median family income of City of Arroyo Grande households as defined in section 50093 of the California Health and Safety Code and annually estimated by the US Department of Housing and Urban Development. Affordable Housing Agreement Grace Lane Residential Subdivision Page 2 November 2006 .� .1 1.9 "Moderate income" means households defined in section 50093 of the California Health and Safety Code. 1.10 "Unrestricted Fair Market Value" means the amount that an Affordable Unit could sell for if its sales price and occupancy were not restricted under the Affordable Housing Ordinance. The City may, at its sole option, require that the Unrestricted Fair Market Value be established through an appraisal by an MAI or other qualified appraiser. 2.0 Compliance with Affordable Housinq Aqreement. Developer shall comply with this Affordable Housing Agreement, all of the applicable requirements and conditions of the Affordable Housing Ordinance and any special terms, conditions, requirements and/or waivers that were specifically applied to the Project as part of the City's approval of the Project. 3.0 Number. Location and Distribution of Affordable Units. The Developer shall develop four (4) Affordable Units which shall be reserved for moderate-income households. 4.0 Pricina of Affordable Units. Developer shall sell each Affordable Unit for no more than the Maximum Allowable Sales Price set for the unit as established by the City pursuant to the Affordable Housing Ordinance. Developer shall notify City thirty (30) days prior to offering each Affordable Unit for sale to allow City adequate time to calculate and notify Developer of the Maximum Allowable Sales Price for the unit and the income limits for Eligible Purchasers. The method for calculating the Maximum Affordable Sales Price is described in Exhibit B of this Agreement and shall be calculated based upon the moderate-income limits provided by the County of San Luis Obispo in its monthly bulletin summarizing the County's "Affordable Housing Standards." 5.0 Recordation and Release of Aqreement. This Agreement shall be recorded against the title to the Property prior to the recordation of the Final Subdivision Map(s) for the Project. Upon the recordation of a Final Subdivision Map(s), the City shall release from this Agreement all parcels created by the Final Subdivision Map(s) that are not designated as Affordable Units. 6.0 Marketinq and Sales of Affordable Units. Provisions 6.1 to 7.0 within this Agreement shall relate to the marketing and sales of affordable houses as described within this Agreement. 6.1 General Provisions. Except where this Agreement provides otherwise, Developer shall follow the procedures and comply with the requirements of the Arroyo Grande Municipal Code when marketing and selling the Affordable Units. Affordable Housing Agreemen[ Grace Lane Residrntial Subdivision Page 3 November 2006 � � 6.2 Particiaation in Affordable Housinq Proqrams. Developer shall to the greatest extent reasonably possible participate in the available local, State and Federal affordable housing programs. 6.3 Verification of Buver Eliqibilitv. Prior to the close of escrow for the sale of each Affordable Unit, the Developer shall provide verification to the City that the buyer's income does not exceed the maximum allowed for the Moderate-Income Level for that unit. Incomes shall be verified (or previous verifications shall be updated) no earlier than sixty (60) days prior to close of escrow. The San Luis Obispo Housing Authority, or similar non-profit entity, shall qualiry owners. 6.4 Individual Requlatorv, Securitv and Disclosure Documents. Prior to the sale of each Affordable Unit, Developer shall ensure that: 6.4.1 The buyer and the City sign a Buyer's Occupancy and Resale Agreement with Option to Purchase (hereinafter "Resale AgreemenY'), which is in the form that is attached as Exhibit C to this Agreement. The Resale Agreements shall be recorded against the title to each unit immediately following the liens for any loans that are obtained by the homebuyer to finance the purchase of the unit. 6.4.2 The buyer signs a Deed of Trust, which is in the form that is attached as Exhibit D to this Agreement, to secure pertormance of the Buyer's obligations under the Resale Agreement and, should the buyer fail to comply with the terms of the Resale Agreement, payment of Excess Sales Proceeds. The Deed of Trust shall be recorded against the title to the unit following the liens for any loans that are obtained by the homebuyer to finance the purchase of the unit. 6.4.3 The buyer signs a Disclosure concerning the Affordable Housing Ordinance, the Resale Agreement and the Deed of Trust, which is in a form that will be provided or approved by the City. 7.0 Default. The City of Arroyo Grande shall have the first opportunity to purchase an affordable unit that has a defaulted loan. 8.0 Other Provisions. The following terms and conditions shall also apply to this Agreement and the development and sale of the Affordable Units that are governed by this Agreement. 8.1 Term of Aqreement. This Agreement of shall remain in force until six (6) months following the sale of the last Affordable Unit to an Eligible Purchaser. Affordable Housing Agreement Grace fane Residrntlal Subdivision Page 4 November 2006 � ..� 8.2 Term of Affordabilitv. Each Affordable Unit shall remain affordable for a minimum period of thirty (30) years from the date of its sale by Developer to an Eligible Purchaser pursuant to a 30-year restrictive covenant to be recorded against the Property which shall specify that the affordability of the Affordable Units shall remain in place for a rolling thirty-year period, not to exceed 90 years, through a deed restriction to be recorded against each Affordable Unit, or equivalent restrictive covenant(s) and deed restriction(s) as approved by the City Attorney. 8.3 Arrovo Grande Municipal Code. Unless the text of this Agreement specifies otherwise, any reference to a Section number is a reference to the Arroyo Grande Municipal Code. 8.4 No Joint Venture or Partnershia. Nothing contained in this Agreement or any document executed with this Agreement shall be construed as creating a joint venture or partnership between the City and Developer. 8.5 Reportinq and Comaliance Monitorinq. Compliance with the requirements of this Agreement covering the initial sale of the Affordable Units shall be reported to the City by the Developer and certified by a third party such as a Certified Public Accountant approved by the City Manager. Annual reports shall be submitted to the City by an independent agency, such as the San Luis Obispo County Housing Authority, verifying continuing compliance with the requirements of this Agreement. Developer shall provide the City with other reports as reasonably required by the City to verify compliance with this Agreement. 8.6 A�pointment of Other Aqencies. At its sole discretion, City may designate, appoint or contract with any other public agency, for-profit or non-profit organization to perform the City's obligations under this Agreement. 8.7 Burden to Run with Propertv. The covenants and conditions herein contained shall apply to and bind the heirs, executors, administrators, successors, transferees, and assignees of all the parties having or acquiring any right, title or interest in or to any part of the Property and shall run with and burden the Property until terminated or released in accordance with the provisions hereof. Prior to the issuance of building permits, the Developer shall expressly make the conditions and covenants contained in this Agreement a part of any deed or other instrument conveying any interest in the Property. Notwithstanding anything to the contrary set forth in this Agreement, individual purchasers of units pursuant to any approved public report in compliance with the California Subdivided Lands Act, and mortgage lenders holding deeds of trust on such individual units after sale to such purchasers, shall not be subject to the terms of this Agreement; and the terms of this Agreement shall be of no further force or effect with respect to such completed unit on the date of the recordation of a deed to the individual purchaser. Affordable Housing Agreemen[ Grace lane Residential Subdivision Page 5 November 2006 � .,� 8.8 Hold Harmless. Developer will indemnify and hold harmless (without limit as to amount) City and its elected officials, officers, employees and agents in their official capaoity (hereinafter collectively referred to as "Indemnities"), and any of them, from and against all loss, all risk of loss and all damage (including expense) sustained or incurred because of or by reason of any and all claims, demands, suits, actions, judgments and executions for damages of any and every kind and by whomever and whenever made or obtained, allegedly caused by, arising out of or relating in any manner to the development of the Property or the sale of units on the Property, and shall protect and defend Indemnities, and any of them with respect thereto. 8.9 Insurance. Developer shall obtain, at its expense, comprehensive general liability insurance for the development of the Property naming Indemnities as additional named insureds with aggregate limits of not less than Two Million Dollars ($2,000,000) for bodily injury and death and property damage, including coverage for contractual liability and products and completed operations purchased by Developer from an insurance company duly licensed to engage in the business of issuing such insurance in the State, with a current BesYs Key Rating of not less than A-VII, such insurance to be evidenced by an endorsement which so provides and delivered to the City Clerk prior to the issuance of any building permit for the development of the Property. 8.10 Recordinq of Aareement. The parties hereto shall cause this Agreement to be recorded against the Property in the official Records of the County of San Luis Obispo. 8.11 Third Partv Beneficiaries. This Agreement is made for the sole protection and benefit of City, and their permitted Successors. No other person shall have the right of action based on any provision of this Agreement. 8.12 Aaolicable Law. This Agreement shall be construed and enforced in accordance with the laws of the State of California. Any dispute arising out of this Development Agreement shall be determined by the State Courts of the County of San Luis Obispo. 8.13 Partial Invaliditv or Unenforceabilitv. If any provision of this Agreement shall be determined by a court to be invalid and/or unenforceable, or if any provision of this Agreement is rendered invalid or unenforceable according to the terms of any statute of the State of California which became effective after the effective date of this Agreement, then the remaining provisions of this Agreement shall nevertheless remain in full force and effect. Affordable Housing Agreement Grace Iane Residentlal Subdivision Page 6 November 2006 �.. ... 8.14 Notices and Corresoondence. Any notices and correspondence conceming this Agreement shall be sent to the parties at the following address: � City of Arroyo Grande P. O. Box 550 Arroyo Grande, CA 93421 Attn: City Manager IN WITNESS WHEREOF, this Agreement idersigned as of the date set forth below. �Jis�o,,�ob\2 l.�-C Vista Roble LLC 139 W. Branch Arroyo Grande, CA Attn: Greg Nester has been duly executed by the / O D TE DATE CITY: ��%� — i� ..- APPROVED AS TO FORM AND LEGAL EFFECT: TIM THY J. C L, City Attomey Affordable Housing Agreemen[ Grace Iane Residential Subdivision Page 7 November 2006 � STATE OF CALIFORNIA ) ) SS COUNTY OF SAN LUIS OBISPO ) On �.,��,�...,,.h�� Z acol before me, l�� 1r. .�}dc`1 �� o��- ^� P� b1,• � personally appeared ,S�e9er�1�/#d'a�S�personally known to me to be the person whose name is subscribed to the within instrument and acknowledged to me that he executed the same in his authorized capacity and that by his signature on the instrument the entity upon behalf of which the person acted, executed the instrument. WITNESS my hand and o�cial seal. Signature `�y_� �� (/ STATE OF CALIFORNIA ) )SS COUNTY OF SAN LUIS OBISPO ) On �D� �pm ba✓ 5,��O 6 before me, IJe L-��r•. L � InJ¢�r �h� ny�.- l�o+e�-, Pc�bi�� personally appeared S+�e J.ar -�'AMs personally known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/hed their authorized capacity(ies) and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument. WITNESS my hand and official seal. Signature ,(_j,�,l',..KR-h7�..'LL �it-«�� Affordable Housing Agreemen[ Grace Lane Residential Subdivision Page 8 � � r..:.,.� � � - - ,;� �",1t-_ � � `� � , ;' �� M1 • . : ... ��: (The above area for official notarial seal) DEBORAH LEE WEICHINGER Commission # 1384436 � i y Notary Public - Californla � San Luis Obispo County — My Comm. F�ires Dec 11, 2006 (The above area for official notarial seal) Nwember 2006 � Exhibits Exhibit A - Legal Description Exhibit B- Calculation of Maximum Allowable Sales Prices Exhibit C- Form of Resale Agreement Exhibit D- Form of Deed of Trust ... ) Affordable Housing Agreement Grace lane Residrntial Subdivision Page 9 Novemba 2006 � Exhibit A Legal Description AFFORDABLE HOUSING LOTS .., LOTS 16-19 OF TRACT 2236 IN THE CITY OF ARROYO GRANDE, COUNTY OF SAN LUIS OBISPO, STATE OF CALIFORNIA, ACCORDING TO THE MAP RECORDED , 2006, IN BOOK OF MAPS AT PAGES , IN THE OFFICE OF THE COUNTY RECORDER OF SAID COUNTY. �, Exhibit B ... MAXIMUM ALLOWABLE SALES PRICE CALCULATION FOR MODERATE INCOME UNIT The maximum allowable sales price calculation for a moderate-income unit shall be based on the affordable housing standards issued monthly by the San Luis Obispo County Department of Planning and Building. As of October 3, 2006 the sales price for a moderate income 3-bedroom unit was $248,040. The prevailing interest rate used to calculate the maximum allowable sales price shall be determined by the City at its sole discretion. Below are the steps to calculate the maximum allowable sales price. The price of the unit shall be determined at the time of sale. 1. Determine the annual Arroyo Grande Moderate or Lower Income Limit for a household size that is one person larger than the number of bedrooms in the affordable unit; 2. Multiply the income limit determined in the previous step by thirty percent (30%) to obtain an annual housing allowance of thirty percent (30%) of income; 3. Divide the annual housing allowance determined in the previous step by twelve (12) to determine the monthly housing allowance; 4. Using a standard amortization table or formula, calculate the loan amount that can be repaid over thirty (30) years with equal monthly payments equal to the monthly housing allowance using the prevailing interest rate for thirty (30) years, and assuming a fully amortized fixed rate mortgage; and 5. Divide the loan amount calculated in the previous step by 0.95 to determine the Maximum Allowable Sales Price assuming a five percent (5%) down payment. � Exhibit C Form of Resale Agreement � (A copy of the proposed individual Resale Agreement follows this page)