20-1454ORDINANCE NO.20- 1454
AN ORDINANCE OF THE CITY OF DENTON AUTHORIZING THE CITY MANAGER TO
EXECUTE A FUNDnqG AGREEMENT BETWEEN THE CITY OF DENTON AND THE
DENTON AFFORDABLE HOUSING CORPORATION TO PROVIDE HOME
INVESTMENT PARTNERSHIP PROGRAM FUNDS FOR REHABILITATION OF FOUR (4)
RENTAL ACCESSIBLE UNITS IN DENTON, TX; AUTHORIZING THE EXPENDrruRE
OF FUNDS NOT TO EXCEED $72,250; AND PROVIDING AN EFFECTIVE DATE.
WHEREAS, the City Council of the City of Denton recognizes the need to assist low and
moderate-income families in securing safe, sanitary and decent housing; and
WHEREAS, the City has received funds from the U.S. Department of Housing and Urban
Development under the National Affordable Housing Act of 1990 as amended; and
WHEREAS, the City Council approved the 2019 Action Plan for Housing and
Community Development which includes an authorized budget expenditure of funds for rental
rehab of Denton Affordable Housing Corp. rental units; and
WHEREAS, the City has adopted a budget for such funds included therein an authorized
program budget for expenditure of funds, for operating costs and project funding for the Denton
Affordable Housing Corporation (“DAHC”); and
WHEREAS, the City Manager has determined that the DAHC is the only locally-certified
Community Housing Development Organization (“CHDO”) that includes the required number of
low income citizens from the City or representatives of the low income community on its board of
directors necessary to satisfy federal requirements to serve the City’s geographical area and that
DAHC has provided management services to the City to provide affordable housing within the City
which as significantly benefited the community; and
WHEREAS, DAHC has a demonstrated history of significant service to the community in the
area of affordable housing; and
WHEREAS, this Agreement, therefore, qualifies as a sole source procurement in accordance
with §252.022(7)(D of the TEX. LOC. GOV’T CODE and does not need to be competitively bid;
and
WHEREAS, DAHC is a locally-based non-profit organization and this Agreement is also
authorized by §373.005 of the TEX. LOC. GOV’T CODE to meet the needs and objectives of the
City’s Consolidated Plan for Housing & Community Development; and
WHEREAS, the City Council deems it in the public interest to enter into an agreement for an
affordable housing program with the DAHC; NOW, THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS:
SECTION 1. The findings and recitations in the preamble of this ordinance are
incorporated herein by reference as true and as if fully set forth in the body of this ordinance.
Page 1
SECTION 2. The City Manager is hereby authorized to execute the attached Agreement
between the City of Denton and Denton Affordable Housing Corporation to provide affordable
housing noted therein.
SECTION 3. The City Council hereby authorizes the City Manager to expend funds in the
manner and amount specified in the Agreement, not to exceed $72,250.00, and to take any other
actions necessary to complete the City’s obligations under the Agreement.
SECTION 4. This ordinance shall become effective immediately upon its passage and
approval.
secondeP;y'rleFFIo;PT:: :A grdinance was m,ate:d=aT,U=„ L,'!:,~dC„d ,pp„,,da::
the following vote b - O
Aye Nay Abstain Absent
leMayor Chris Watts:
Gerard Hudspeth, District 1 :
Keely G. Briggs, District 2:
Jesse Davis, District 3 :
John Ryan, District 4:
Deb Armintor, At Large Place 5
Paul Meltzer, At Large Place 6:
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PASSED AND APPROVED this the b+D d,y .f Oc+ob er , 2020
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Gerard Hudspeth, Mayor Pro Tem
ATTEST:
ROSA RIOS, CITY SECRETARY
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APPROVED AS TO LEGAL FORM
AARON LEAL, CITY ATTO *{~
AGREEMENT BETWEEN THE CITY OF DENTON AND
AND DENTON AFFORDABLE HOUSING CORPORATION.
This Agreement between the City of Denton and Denton Affordable Housing Corporation
("Agreement") is made and entered into by and between the City of Denton, a Texas municipal
corporation ("CITY"), acting by and through its City Manager, pursuant to ordinance, and Denton
Affordable Housing Corporation Denton, Texas a non-profit corporation, (’'OWNER"), acting by
and through the Executive Director.
This HOME Agreement is entered into as of this CD th day of C)C+obe_c , 2020 by
and between City of Denton, a Texas municipal corporation (CITY) and Denton Affordable
Housing Corporation (OWNER).
WHEREAS, CITY is the administrator of HOME Investment Partnership Program funds (HOME
Funds) received from the U. S. Department of Housing and Urban Development (HUD) under Title
II of the Cranston-Gonzalez National Affordable Housing Act of 1990, as amended (the Act); and
WHEREAS, the purpose of the HOME Investment Partnership Program (the HOME Program)
is to increase the supply of decent, safe, sanitary, and affordable housing for very low income,
low income and moderate-income households; and
WHEREAS, CITY has designated the Community Development Division as the City division
responsible for the administration of this Agreement and all matters pertaining thereto; and
WHEREAS, OWNER proposes to use HOME funds for an eligible project under the HOME
Regulations whereby OWNER will rehab Two (2) duplexes - four (4) accessible rental units
housing project in Denton, Texas, to be known as 440/442 and 444/446 Strata (the PROJECT), in
the city of Denton; and
WHEREAS, the CITY has recommended approval of a forgivable payment loan to OWNER,
subject to the terms specified herein below, and
WHEREAS, CITY wishes to engage Denton Affordable Housing Corporation to carry out the
project as specified in this Agreement;
NOW, THEREFORE, the parties hereto agree, and by the execution hereof are bound, to the
mutual obligations and to the performance and accomplishment of the conditions hereinafter
described.
1. CHDO Provisions
A. CHDO Designation
Denton Affordable Housing Corporation has been designated by CITY as a Community
Housing Development Organization (CHDO) as defined under 24 CFR 92.2 and shall serve as
the (OWNER) of the Project as such role is defined under 24 CFR 92.300(a).
B. Certification of Current and Continuing CHDO Status
Denton Affordable Housing Corporation hereby acknowledges that this Project is being
funded with HOME funds reserved specifically for CHDOs and certifies that as of the date of
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this Agreement it meets the definition of a CHDO under 24 CFR 92.2. Denton Affordable
Housing Corporation further certifies and agrees that it will continue to operate its affairs
such that it continuously meets the CHDO definition for the life of this Agreement and will
notify CITY immediately if any change in circumstance results in it no longer meeting these
criteria at any time during the term of this Agreement. It further will provide documentation
to CITY as may be requested from time to time to document that it continues to comply with
the CHDO definition.
C. Tenant Grievance Procedures and Tenant Participation
OWNER will operate the Project in compliance with 24 CFR 92.303 and will adhere to a fair
lease and grievance procedure approved by CITY and follow a program of tenant participation
in management decisions. OWNER will update these procedures from time to time as may be
appropriate or required by CITY and will report to CITY on their implementation.
In order to assure compliance with the Project Requirements of the HOME Program (as
defined Title 24 of the Code of Federal Regulations, Part 92, Subparts E and F), OWNER agrees
to submit annually the following documentation to City for review and approval:
•
•
A copy of the tenant application and a description of the tenant qualification process to
include Tenant Selection Procedures that OWNER will utilize to verify tenant incomes.
A copy of the lease agreement form. OWNER agrees to attach to its standard lease
agreement form, the Mandatory Lease Addendum to control over any conflicting
prohibited lease terms, a copy of which is attached hereto as Attachment C, which must
be completed by OWNER and every tenant household in connection with the execution
of the lease and upon the City's request.
•OWNER hereby agrees to verify all income, assets, household characteristics, and any
other circumstances that affect tenant eligibility in accordance with 24 CFR Part 5.
Further, OWNER shall assist the City in acquiring tenants' consent and release
authorization for purposes of determining or auditing tenant income eligibility or for
verifying related information from depository or private source of income, or any Federal,
State, or local agency ("source documentation").
•
•
A copy of OWNER's plan for tenant participation in management decisions and fair lease
and grievance procedures.
If applicable, a copy of OWNER's procedures for marketing the availability of accessible
units to eligible persons such that reasonable, nondiscriminatory steps are taken in
making the accessible units that become available are offered to persons who require the
accessibility features.
2. THE PROJECI
A. Project Description
The Project is a planned Two (2) duplexes - four (4) accessible rental units rental rehab
located in Denton, Texas at 440/442 and 444/446 Strata, Denton, TX 76205.
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A summary of the Project, including unit breakdowns, unit and on-site amenities, and key
financing sources and terms, is attached as Attachment A and B.
B. Tasks and Schedule
To ensure that the Project progresses adequately toward completion, OWNER must achieve
the following benchmarks.
1. Final Plans and Specifications: No later than October 1, 2020 and prior to initiating
construction activity, OWNER must provide evidence to CITY that all Code and Physical
Requirements will be met (see Section 8. CONSTRUCTION, PROPERTY STANDARDS AND
MANAGEMENT) .
2.Construction: Unless otherwise extended by CITY, OWNER must begin construction on
the Project no later than October 1, 2020 and substantially complete construction within
twelve (12) months. Per the requirements of 24 CFR 92.2, in any event OWNER must begin
construction no later than twelve (12) months from the date of execution of this
Agreement.
3. Cost Certification: Within one hundred-twenty (120) days of completing construction,
OWNER must provide a cost certification prepared by an independent certified public
accountant outlining the final sources and uses of all funds or a summary and backup of
bids
4.Completion Report: Prior to final disbursement of funds, OWNER must provide CITY with
demographic data on the initial occupants of all HOME-assisted units in the Project in
order to complete the Project in HUD’s IDIS system. If the Project is not completed in
HUD’s IDIS system within twenty-four (24) months of the date of execution of this
Agreement, CITY may cancel its commitment of funding, and the OWNER shall repay any
HOME funds previously advanced for the Project. In any case, if the Project is not
completed in HUD’s IDIS system within four years of the date of this Agreement, the
Project will be considered terminated prior to completion and per the requirements of 24
CFR 92.205(e), and all HOME funds must be repaid by the OWNER.
5.Absolute Lease-Up Deadline: All HOME units must be occupied within eighteen (18)
months of Project Completion, as defined in section 2.A. herein. Any HOME unit that is
not occupied within eighteen (18) months will be deemed ineligible pursuant to 24 CFR
92.252, and the OWNER will repay any HOME funds attributable to those units based
upon a revised cost allocation analysis completed by CITY.
C. Budget
1 HOME Investment: Conditioned upon the availability of HOME Program Funds, and
OWNER’s compliance with the conditions set out herein, CITY intends to provide up to
Seventy-two thousand, two hundred and fifty dollars ($72,250) in HOME funds to OWNER
toward eligible project costs. In no case will CITY’s funding of the Project be less than
$1,000 per HOME-assisted unit or more than the maximum per-unit subsidy allowed
under 24 CFR 92.250(a). The maximum subsidy limits are based on bedroom size:
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Select Bedrooms Available (Amounts are effective 7/1/2019.)
D 0-bedroom units are $42,411; and
[] 1-bedroom units are $164,203; and
D 2-bedroom units are $198,034; and
n 3-bedroom units are $253,490; and
[] 4-bedroom+ units are $282,398.
3. TERM
The term of this Agreement shall begin on the date represented by the date of the last signature
of either party executing the Agreement, and shall expire upon completion of both the HOME
Affordability Period and Extended Use Period, as those terms are defined below.
The HOME Affordability Period, and the Covenant Running with the Land as outlined in section
6.A.4, shall continue irrespective of any payment/payoff of the HOME Forgivable Payment Loan.
Failure of the Project to meet all applicable HOME requirements for the entire HOME
Affordability Period will result in a requirement that all HOME funds be repaid.
A.HOME Affordability Period: As a rehab rental project, the HOME Affordability Period
during which OWNER must maintain compliance with all applicable HOME rules shall
begin with initial occupancy of the Project and shall run for ten (10) years following the
date on which the Project has met the requirements for Project Completion outlined in
24 CFR 92.2, which will require that construction be complete, all HOME funds have been
disbursed by CITY and drawn from the US Treasury, and required completion data has
been entered in HUD’s IDIS system.
B Establishment of Affordability Completion: Upon entering all required information in
HUD’s IDIS system, CITY will notify OWNER of the actual date of Project Completion and
the exact date of the expiration of the HOME Affordability Period, which shall be
calculated based on the date of Project Completion. If necessary, OWNER shall execute
an amendment to the Covenant Running with the Land identifying the exact dates of
expiration of the HOME Affordability Period and Extended Use Period.
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C. Extension of Agreement: Request for an extension must be in writing and is to be
submitted to the Community Development Division, 601 E. Hickory Street, Suite B,
Denton, TX 76205.
4. RESPONSIBILITIES
A.OWNER hereby accepts the responsibility for the performance of all services and activities,
described in the Work Statement attached hereto as Attachment A and incorporated herein
as if set forth at length, in accordance with the Program Budget attached hereto as
Attachment B and incorporated herein as if set forth at length, and as otherwise set forth
herein, in a satisfactory and efficient manner as determined by CITY, in accordance with the
terms herein.
B. OWNER's executive director shall be OWNER's representative responsible for the
management of all contractual matters pertaining hereto, unless written notification to the
contrary is received from OWNER, and approved by CITY.
C. The CITY's Housing Programs Manager will be CITY's representative responsible for the
administration of this Agreement.
D. OWNER shall comply with 2 CFR Part 200, Uniform Administrative Requirements, Cost
Principals and Audit Requirements for Federal Awards, Final Guidance, and the regulations
found at 24 CFR Part 92.
E. OWNER shall not request disbursement of funds until they are needed for payment of eligible
costs. The amount of each request will be limited to the amount needed as per 24 CFR 92.504
(c)(3)(viii).
F. OWNER understands that, in accordance with 2 CFR Part 200, suspension or termination may
occur if the OWNER materially fails to comply with any term of this agreement. The
agreement may also be terminated for convenience.
G. OWNER shall not change the Program Budget without prior written approval from the CITY.
5. CITY'S & OWNER'S OBLIGATIONS
A.
B.
CITY shall provide funds in the amount of Seventy-two thousand, two hundred and fifty
dollars ($72,250) or less in project funds to the OWNER for specific housing projects and
programs as described in the Work Statement, Attachment A.
OWNER agrees to hold and save harmless the CITY, its officers and employees from any and
all loss, cost, or damage of every kind [including, property damage, bodily injury or death],
nature or description arising under this Agreement.
C Environmental Review. CITY shall be responsible for performing an environmental review to
insure necessary compliances are met.
HOME Funds will not be paid and costs cannot be incurred until CITY has conducted and
completed an environmental review and completed an Environmental Review Record as
required by 24 CFR Part 58. The environmental review may result in a decision to proceed
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with, modify, or cancel the project. Further, OWNER will not undertake or commit any funds
to physical or choice limiting actions, including if applicable, property acquisition, demolition,
movement, rehabilitation, conversion, repair or construction prior to the environmental
clearance. Any violation of this section will (i) cause this AGREEMENT to terminate
immediately; (ii) require OWNER to repay to CITY any HOME Funds received and forfeit any
future payments of HOME Funds; and (iii) OWNER must pay 10% of the HOME Funds to CITY
as liquidated damages. The Parties agree that CITY’s actual damages in the event of OWNER
violating this section are uncertain and would be difficult to ascertain and may include a
finding by HUD, a repayment of funds to HUD by CITY or otherwise impact the CITY’s HOME
grant or other Federal grant funds. Therefore, the Parties agree that payment of 10% of the
Loan amount by OWNER to CITY under this section is liquidated damages and not a penalty.
D. Mitigation.
OWNER must take the mitigation actions if required. Failure to complete the required
mitigation action is an event of default under this AGREEMENT.
This Agreement and the payments made hereunder are contingent upon receipt of U.S.
Department of Housing and Urban Development funds pursuant to the HOME Investment
Partnerships Program, and shall terminate immediately, not withstanding the provisions of
Article XIX hereof, should such funds be discontinued for any reason.
E.
F. Upon dissolution of the OWNER any remaining funds or assets derived from the expenditure
of the CITY's funds, hereinafter sometimes described as the CITY's HOME funds, proceeds or
HOME-funded projects, must be immediately reallocated to the CITY.
6. FORM OF FINANCING AND DISBURSEMENTS
A. Form and Terms of Assistance
1.HOME Forgivable Payment Loan: CITY will provide HOME funding as a construction to
permanent Forgivable payment loan to the Project. The term of the HOME Forgivable
Payment Loan will commence at execution of the Mortgage and Note and continue for a
term of ten (10) years from the date of Project Completion as outlined in 24 CFR 92.2,
which will require that construction be complete, all HOME funds have been disbursed by
CITY and drawn from the US Treasury, and required completion data has been entered in
HUD’s IDIS system.
The HOME Forgivable Payment Loan will carry (0%) interest (provided there is no default)
and shall be forgiven following expiration of the HUD-mandated minimum affordability
period of ten (10) years, to commence on the date of project completion in described
herein
2. Security: The HOME Forgivable Payment Loan must be secured by a promissory note, a
first-position mortgage on the Property.
OWNER agrees to execute any and all notes, security agreements, financing statements,
affordability covenants, builder's and mechanic's liens and deeds of trust and any other
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documents or amendments that are consistent with this Agreement and are reasonably
necessary for perfection of City's lien or lien interests in the form submitted by Counsel
for the City. OWNER further agrees to cooperate with the City in re-signing any
documents to correct errors or omissions, if any, in any form or legal document required
by the City or HUD.
3.Title Search/Insurance: Prior to the start of project, CITY will perform a preliminary title
search. Should any items on the search arise, OWNER shall provide a title insurance policy
insuring the Property. OWNER shall provide a title insurance policy insuring the Property
in standard form issued by a title company authorized to do business in the State of Texas
and acceptable to CITY. The name of the insured shall be City of Denton, a Texas municipal
corporation. The policy shall show fee simple title to the Property in OWNER, subject only
to such exceptions as CITY may approve, be in the full amount of CITY's loan, contain a
comprehensive coverage endorsement and such other endorsements as CITY may require
and shall insure that the mortgage constitutes a valid Texas Department of Housing &
Community Affairs, lst position lien on the Property, and that the Property is free of all
liens, encumbrances, restrictions or other matters of any kind whatsoever, with only such
exceptions from coverage as are satisfactory to CITY.
4.Covenant Running with the Land: OWNER must record a covenant running with the land,
in form satisfactory to CITY, that provides a means for enforcement of the affordability
restrictions of 24 CFR 92.252. CITY’s covenant running with the land must be senior to all
other financing liens, including the first mortgage from Texas Department of Housing &
Community Affairs, and CITY’s mortgage referenced above, and be enforceable against all
successors in interest to OWNER.
5. Reserved
Guarantees shall include, at a minimum, the following terms:
A guarantee of completion, ensuring that OWNER will construct, equip, and complete
the Project free and clear of liens substantially in accordance with the plans and
specifications by the date called for in section 2.B.2. Failure to complete the Project
under these terms will result in OWNER’s and Guarantors’ obligation to
(i) pay all costs and expenses incurred in completing any unfulfilled obligations and
(ii) pay to or reimburse CITY for all expenses incurred by CITY with respect to its
carrying out any of OWNER’s unfulfilled obligations. This guarantee will expire
upon CITY’s final inspection and approval of the Project’s construction.
•An ongoing guarantee of performance, ensuring that the Project will be operated in
compliance with all applicable federal, state, and local laws or ordinances or
regulations, including but not limited to HOME regulations and fair housing laws.
During the HOME Affordability Period, failure to maintain the Project in compliance
with all applicable laws, or the inability to correct instances of noncompliance, will
result in a requirement that the OWNER and Guarantors satisfy any repayment
obligation to HUD incurred by CITY under 24 CFR 92.503(b).
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• Aguarantee of annual deposits to a Replacement Reserve for the Project in an amount
consistent with the Loan Documents.
B. Disbursement
CITY’s HOME Loan is intended as construction and permanent financing. OWNER may request
disbursements no more than monthly and not less than quarterly from CITY during the
construction period in accordance with the terms set forth in this section.
Notwithstanding anything herein, CITY will draw HOME funds as needed to directly reimburse
itself for certain project-related soft costs applicable to the Project. These include but may
not be limited to costs incurred by CITY in the underwriting, review, and oversight of the
Project prior to completion and will include internal costs of CITY staff and external costs of
CITY consultants. All CITY project-related soft costs will be included in the total HOME
investment and incorporated into the HOME Forgivable Payment Loan.
Further, CITY shall retain the right to review and approve all draws for the Project, regardless
of whether the HOME Forgivable Payment Loan will be used to fund any given draw. For
draws being funded by other construction or permanent funding sources, CITY shall be
provided with the draw not less than 10 days prior to any monthly inspection and provided
with the opportunity to approve or object to the draw prior to payment by any funding
source
1. Conditions of Construction Draws: Proceeds of the HOME Loan will only be released to
OWNER for actually incurred HOME-eligible project costs. The obligation of CITY to
approve any draw or to make any disbursement of HOME funds is subject to the
satisfaction of the following conditions at the time of making such disbursement:
a. OWNER shall not be in default under the terms of this Agreement or of any of the
Loan Documents, and no event shall exist, which by notice, passage of time, or
otherwise would constitute an event of default under this Agreement or any of the
Loan Documents.
b. The Project shall not have been materially damaged by fire or other casualty.
c. CITY shall have received evidence satisfactory to CITY that all work and improvements
requiring inspection by any governmental authority having jurisdiction have been
inspected and approved by such authorities and by any other persons or entities
having the right to inspect and approve construction.
d. OWNER shall have submitted at least ten (10) days prior to the date a disbursement
is desired a completed disbursement and such other appropriate source
documentation as may be required by CITY including, without limitation, the
following:
0 Statements identifying all contractors, subcontractors and suppliers along with
their addresses, and identifying all labor and materials furnished to date along
with the amounts paid to date and the balances due and any change orders, as
well as sworn lien waivers executed by the contractors, subcontractors, and/or
suppliers covering all labor and materials identified in the prior request for
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disbursement approved by CITY, said sworn statements and sworn lien waivers
to be dated no less than five (5) days precedent to the date of the requested
disbursement, or such other documentation or supporting evidence as shall
enable the Title Company to issue an endorsement to the title policy, including
receipts or other vouchers showing payments for labor, payments to
subcontractors and payments to material suppliers.
0 Evidence satisfactory to CITY that the Project and the contemplated use thereof
are permitted by and comply with all applicable use or other restrictions and
requirements in prior conveyances, zoning ordinances, or regulations that have
been duly approved by the municipal or other governmental authorities having
jurisdiction; that the required building permits and other permits have been
obtained as required; and that no environmental impact statement is required or
that such environmental impact statement has been properly filed and approved.
o Appropriate certifications of compliance in all respects with labor standards and
prevailing wage requirements applicable under federal law.
o Such other supporting evidence as may be requested by CITY or its agent to
substantiate all payments which are to be made out of the relevant disbursement
and/or to substantiate all payments then made with respect to the Project.
e. CITY shall have determined that all HOME requirements pertaining to the
disbursement of funds have been met, including but not limited to monitoring of Davis
Bacon Wage Rate Determination compliance as described in Section 9. G- Compliance
with Davis-Bacon Act.
f. An inspection of work completed will need to be completed by Community
Development Division staff prior to request for reimbursement.
g. No determination shall have been made by CITY that the undisbursed amount of the
loan is less than the amount received to pay all costs and expenses of any kind that
reasonably may be anticipated in connection with the completion of the Project.
2.Conditions of Final Disbursement: in addition to the requirements set forth in section
6.B.1, CITY shall require the following prior to the final disbursement of funds, the request
for which shall not be submitted before completion of the Project, including all landscape
requirements and offsite utilities and streets and correction of defects in workmanship
and/or materials:
Evidence satisfactory to CITY that the Project has been completed lien free and
substantially in accordance with the plans and specifications;
• Review and final settlement of the cost certification described below.
Such other supporting evidence as may be requested by CITY or its agent to
substantiate all payments which are to be made out of the final disbursement
and/or to substantiate all payments then made with respect to the Project.
3. Limitation on Draw Requests:
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a. In all cases, OWNER may not request disbursement of HOME funds until funds are
needed for the payment of eligible costs, and all disbursement requests must be
limited to the amount needed at the time of the request.
b. Notwithstanding anything herein to the contrary, no disbursements for materials
stored will be made by CITY unless OWNER shall advise CITY of its intention to so store
materials prior to their delivery. It is specifically agreed that the propriety of
disbursements for materials stored shall be determined in CITY's sole discretion.
In addition to any other requirements CITY may impose, any disbursement for
materials stored will require, at minimum:
• Certification from the General Contractor (and, as applicable, any subcontractors)
that
o The materials for which payment is requested are consistent with the Project’s
plans and specification and have been purchased specifically for incorporation
into the Project;
o The Contractor (or subcontractor as applicable) is in actual possession of and
has clear, marketable title to the materials and that such materials are not
subject to any lien by the supplier or manufacturer; and
o The materials are appropriately stored on-site and fully insured against theft,
damage, or other loss OR that materials stored off-site are located in a
licensed, bonded, and insured warehouse where they are fully insured against
theft, damage, or other loss.
•Submission of documentation (such as invoices, receipts, shipping manifests, or
insurance policies) satisfactory to CITY supporting the certifications;
That any disbursement for materials stored are otherwise subject to the contract’s
standard retainage provisions;
C.The parties covenant and agree that in the event that CITY discovers a misstatement
in any affidavit, statement, or certificate furnished pursuant to this Agreement, it shall
make no further disbursements until such misstatement has been corrected; that CITY
assumes no liability to the OWNER for mechanic's lien claims; that if at any time during
the course of construction, the total of the unpaid disclosed cost of construction, as
indicated by the column totals on the general contractor's sworn statement, exceeds
the amount of the undisbursed development sources, CITY shall not be under
obligation to make further disbursement under the terms of the Agreement until the
OWNER has deposited with CITY the sum necessary to make the available funds equal
to the unpaid disclosed cost of construction; and that if, after the first disbursement,
a further title search reveals a subsequently arising exception over which the title
insurance company is unwilling to insure, CITY shall discontinue disbursement until
the exception has been disposed of to the CITY’s satisfaction.
4. Withholding Payment: city shall withhold payment on any reimbursement request that
does not include the required complete documentation.
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5.Disbursement of OWNER's Funds: if CITY shall at any time in good faith determine that
the undisbursed amount of available funding is less than the amount required to pay all
costs and expenses of any kind which reasonably may be anticipated in connection with
the completion of the Project and shall thereupon send written notice thereof to OWNER
specifying the amount required to be deposited by OWNER with CITY or its agent to
provide sufficient funds to complete the Project, the OWNER agrees that it will, within
five (5) calendar days of receipt of any such notice, deposit with CITY or its agent, in a
noninterest bearing account, the amount of funds specified in the CITY’s notice. OWNER
agrees that any such funds deposited with CITY or its agent may be disbursed by CITY or
its agent, before any further disbursement from CITY, to pay any and all costs and
expenses of any kind in connection with completion of the Project.
C. Reserves and Other Accounts
For Existing Rental Units, please provide the following yearly budgets:
Replacement Reserve Account Operating Reserve Account
Per TDHCA Requirements Per TDHCA RequirementsExisting Rental Units
1. Term of Reserve Accounts: All required Reserve Accounts must be maintained for the full
term of this Agreement or while CITY HOME Forgivable Payment Loan is outstanding,
whichever is longer.
2.2.3.5 CITY Approval and Access: Any withdrawal or transfer from Reserve Accounts shall
require the written approval of CITY, by and through its designee. CITY’s approval or
request for additional information to substantiate the need for the withdrawal or transfer
shall be provided within ten (10) business days of its receipt of a request for such action.
OWNER must establish the Reserve Accounts to require the signature of CITY designee
and OWNER for all withdrawals and transfers. Further, OWNER shall authorize the
financial institutions in which Reserve Accounts are held to provide CITY, when requested,
verified statements reflecting account balances and transactions.
D. Operating Receipts and Expense Account
The OWNER shall establish and maintain an Operating Receipts and Expense Account to be
reviewed by CITY during monitoring visits. All rents and other receipts of the Project shall be
deposited in the name of the OWNER and the Project. The OWNER shall, upon collection of
all Project receipts from whatever source derived from the operation of the Project,
hereinafter referred to as "Operating Receipts," forthwith deposit the same in the Operating
Receipts and Expense Account. Thereafter, on a monthly basis the OWNER shall pay, or cause
to be paid, in a timely manner out of Operating Receipts of the Project, in the order and
priority as set forth below unless otherwise directed by CITY, at its sole option, in writing:
a. All of the real estate tax and insurance premium escrow payments required of the
OWNER, which payments shall be deemed to be part of the "Operating Expenses" of the
Project for the purpose of this Agreement; and
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b. The fee of the Project’s managing agent as set forth in the Management Agreement
between the OWNER and said managing agent; and
C.All remaining "Operating Expenses" of the Project (which specifically exclude the
Forgivable Payment Loan principal, interest, and annual fee payments), including but not
limited to, taxes other than those for which an escrow payment is required under this and
any permitted senior mortgage, maintenance, fuel, management, water and sewage,
administration, electricity, legal, audit, and all other current expenses, unless other funds
for payment are set aside or deferment of payment has been approved by CITY; and
d. All of the amortized principal, interest, and premium, if any, required to be paid under
the Note and Mortgage to CITY and to {enter name of other Lenders}; and
e. Att amounts required to be deposited with a designated depository in the Replacement
Reserve account, as set forth in this Agreement.
E. Occupant Security Deposits
The OWNER is further required to segregate or cause to be segregated (i) all occupant security
deposits, to be held in an interest bearing depository account (hereinafter referred to as the
“Security Depository Account”), and (ii) an amount equal of the aggregate of all special funds
required by CITY to be maintained by or with respect to the Project.
7. HOME PROGRAM REQUIREMENTS
A. Affordability Period Requirements
The Project must comply with all requirements of 24 CFR 92.252, in particular requiring the
HOME- assisted units be income and rent restricted for the duration of the Project’s HOME
Affordability Period (see Section 3. Term A.). The Project must also maintain compliance with
the physical standards of 92.251 and be operated consistent with applicable tenant
protection, affirmative marketing, and fair housing requirements of Subpart F of 24 CFR 92.
B. Designation of HOME Units
Two (2) duplexes – four (4) rental units project will be designated as HOME-assisted. The
restrictions of this section shall apply throughout the term of this Agreement. The CITY
reserves the right to adjust the number of HOME-assisted units if the sources and uses of
funds change during development of the Project. The HOME units will be Fixed Units as
defined in 24 CFR Part 92.252.
The HOME Units rented or available for rent to households whose annual incomes do not
exceed 80% of area median income ("AMI"), as set annually by HUD with adjustments for
family size (" High-HOME Eligible Tenant"), shall be 3 units ("High-HOME Units").
1 Income Restrictions: All High-HOME units must be offered for occupancy exclusively to
tenants with household incomes at or below 80% of the Area Median Income (AMI) as
adjusted for household size. The most current income chart must be used when
determining eligibility for a prospective tenant or determining the income at
recertification for in-place tenants.
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The Project must utilize the definition of annual income defined in 24 CFR Part 5.609
(often referred to as the “Section 8“ definition). Prior to signing a lease with any tenant,
OWNER must obtain and examine at least two months of source documents evidencing
household income.
As a reference, OWNER should consult the most recent version of the HUD publication:
Technical Guide for Determining Income and Allowances for the HOME Program.
OWNER acknowledges that the HOME Income Limits are released by HUD on independent
schedules.
2. Income Verification.
OWNER must use the definition of annual income used by 24 CFR 5.609 to establish
tenant income eligibility. OWNER shall use the most current HUD Income Guidelines.
OWNER must verify that all tenants of HOME Units are HOME Eligible Households with
full Tenant Documentation at the time the initial lease for a HOME Unit is executed
Tenants must certify the number of people in tenant’s household along with such
person’s names and ages. OWNER shall obtain financial information on all members of a
tenant’s household.
OWNER must verify the income of the tenants of the HOME Units annually after the initial
lease is executed, but may use a CITY-approved tenant self-certification form as Tenant
Documentation. Notwithstanding the foregoing, OWNER must verify the income
eligibility of all HOME Eligible Households with full Tenant Documentation every 6th year
of the Affordability Period.
OWNER must maintain copies of Tenant Documentation as required under this
AGREEMENT.
CITY will review Tenant Documentation during the Affordability Period as part of its
monitoring.
3. Rent Restrictions: The gross rent for each High-HOME unit may not exceed the High-
HOME rent, as adjusted for unit size and published annually by HUD.
4. Re-verifying Incomes: OWNER shall re-verify the income of in-place tenants using at least
two months of source documentation not less than every 6th year of the HOME
Affordability Period. In years when source documentation is required, all in-place tenants
must be re-verified regardless of how long they have been in place.
5. Treatment of Over-Income Tenants: in the event an in-place tenant, upon re-verification
of the tenant’s income, has a household income above the applicable 80% AMI HOME
Income Limit for Low-HOME or High-HOME tenants, the OWNER shall take the following
actions
• if the High-HOME tenant’s income at re-verification increases to greater than 80%
AMI, then the OWNER will first increase the rent for the over-income tenant to the
lesser of i) 30% of the tenant’s adjusted income or ii) the “market rent" for the unit
(i.e. what the unit would be projected to rent for in the local market absent any
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income or rent restrictions imposed by HOME, LIHTC, or other such programs). The
OWNER must also substitute another unit that is comparable or larger by either i)
designating another unit in the Project occupied by an eligible High-HOME tenant or
ii) renting the next available unit as a High-HOME unit.
6. CITY Approval of Rent, Utility Allowances, and Fees: Pursuant to the requirements of
92.252(d) and (f), CITY must approve the rents and utility allowances applied to the
Project on an annual basis. The OWNER may not increase the rents of HOME-units
without prior approval of CITY.
Additionally, the OWNER shall provide a fee schedule, consistent with requirements of
section 6.C.2 below for review and approval by CITY on an annual basis. Any mandatory
tenant fees not otherwise approved by CITY shall be considered rent and are subject to
the gross rent limits outlined herein.
C. Project Requirements
OWNER must operate the Project in compliance with the requirements of Subpart F of 24 CFR
92
1 Lease: OWNER must have a written lease with each tenant of a HOME-assisted unit, in a
form acceptable to CITY. If directed by CITY, OWNER shall include CITY’s HOME Lease
Addendum, as may be updated from time to time, on all HOME leases. The lease must, at
a minimum, provide all HOME tenants with at least 30 days written notice prior to i)
increasing the rent or ii) terminating or refusing to renew the lease.
All tenants must be offered leases with a minimum period of one (1) year. OWNER cannot
terminate or refuse to renew the lease of any tenant for other than good cause. In
particular, good cause does not include an increase in a tenant’s income or a tenant’s
failure to accept or participate in supportive services being offered now or in the future
to residents of the Project.
Good cause for terminating or refusing to renew the lease shall include material violations
of the lease or violations of applicable federal, state, or local laws.
The lease may not include any provisions prohibited by 24 CFR 92.253(b):
•
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Lease may not include agreement by tenant to allow landlord to take, hold or sell
tenant’s personal property without notice and a court decision on the rights of the
parties.
Lease may not include agreement by the tenant to excuse owner or owner’s agents
from responsibility for any action or failure to act, whether intentional or negligent
acts
•
•
•
Lease may not authorize landlord to institute a lawsuit without notice to the tenant.
Lease may not include agreement by tenant to waive a jury trial or right of appeal.
Lease may not include an agreement by tenant to pay legal costs of court proceeding
even if the tenant prevails in those proceedings regardless of outcome.
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•
Lease may not include an agreement by the tenant to be sued, to admit guilt or to a
judgment in favor of the owner in a lawsuit brought in connection with the lease.
Lease may not include an agreement by the tenant that the owner may evict the
tenant or household members without instituting civil court proceedings in which the
tenant has the opportunity to present a defense, or before a court decision on the
rights of the parties.
•
•
Lease may not include an agreement by the tenant to waive the tenant’s right to
appeal or otherwise challenge in court a court decision in connection with the lease.
Lease may not include an agreement by the tenant to accept supportive services that
are offered.
2. Revised Lease Forms.
OWNER shall provide CITY copies of revised lease forms within 30 days of any change to
its lease form. All changes to OWNER’s lease form shall comply with this agreement.
3.Prohibition on Certain Fees to Tenants: OWNER shall not charge tenants fees to cover
operating costs of the Project or administrative costs related to complying with the HOME
program. Specifically, rental project OWNERs may not charge tenants fees that are not
customarily charged to tenants of rental housing (e.g., laundry room access fees).
However, OWNER may charge fees approved by CITY for the following:
Reasonable application fees to prospective tenants;
• Fees or penalties related to the late payment of rent, non-sufficient funds or returned
checks, or the like provided such fees are determined by CITY to be customary for
rental housing projects in the area and not excessive;
• Parking fees to tenants only if such fees are determined by CITY to be customary for
rental housing projects in the neighborhood and not excessive; and
• Fees for services such as bus transportation or meals, as long as the services are
voluntary and fees are charged only for services provided.
4. Voluntary Services: OWNER must ensure that any supportive services being offered to
tenants of the Project are voluntary. Tenants may not, as a condition of their initial lease
or continued occupancy, be required to accept, participate in, or comply with the
requirements of any supportive services program.
5 Tenant Selection Plan: OWNER must develop a tenant selection plan meeting the
requirements of 24 CFR 92.253(d). OWNER cannot refuse to lease to a holder of a Section
8 Housing Choice Voucher, recipient of HOME Tenant Based Rental Assistance, or a
prospective tenant receiving similar assistance under another federal, state, or local
program solely because of the tenant or prospective tenant’s participation in such
program. The tenant selection plan will be subject to review and approval by CITY both
prior to initial occupancy of the HOME-assisted units and during the term of this
Agreement.
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•The tenant selection policy must be consistent with the purpose of providing housing
for very low and low-income persons. The tenant selection policy must provide for:
o Selection of tenants from a written waiting list in the chronological order of their
application, insofar as is practicable;
o Prompt written notification to any rejected applicant of the grounds for such
rejection; and
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Bi-lingual leasing and management assistance.
Holders of rental assistance subsidies (such as HUD’s Housing Choice Voucher or
similar subsidy) must not be excluded from renting a unit in the project.
The tenant selection policy must address non-discrimination and affirmative
marketing as discussed in section 8.E.
•OWNER must market Accessible Units in the following order:
0 Within the project to persons requiring an accessible unit.
0 To persons on the waiting list requiring an accessible unit.
0 To the general community for persons requiring accessible unit.
0 To persons that do not require an accessible unit.
•The tenant selection policy must (i) address the lease requirements described in this
agreement that address managing HOME Unit requirements, and must comply with
state and local tenant/landlord laws.
6.Conditions for Faith-Based Organizations: Faith-based organizations are eligible to
participate in the HOME program on the same basis as any other organization but must
comply with the requirements of 24 CFR 92.257. Among other requirements, OWNER may
not engage in inherently religious activities such as worship, religious instruction, or
proselytization, as part of the Project. If OWNER does engage in such religious activities,
those activities must be offered separately from the HOME-assisted housing, and
participation by tenants of the Project must be voluntary. Additionally, OWNER shall not
discriminate against a tenant or prospective tenant on the basis of religion or religious
belief
Separation of Explicitly Religious Activities: OWNER retains its independence and may
continue to carry out its mission, including the definition, development practice, and
expression of its religious beliefs, provided that it does not use HOME Funds to support
or engage in any explicitly religious activities (including activities that involve overt
religious content such as worship, religious instruction, or proselytization), or in any other
manner prohibited by law.
Explicitly Religious Activities: if OWNER engages in explicitly religious activities (including
activities that involve overt religious content such as worship, religious instruction, or
proselytization), the explicitly religious activities must be offered separately, in time or
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location, from the programs or activities supported by HOME Funds and participation
must be voluntary for tenants of a HOME-funded unit.
8. coNSTRUcrioN, PROPERTY STANDARDS AND MANAGEMENT
A. Construction Schedule.
OWNER will construct the Required Improvements in accordance with the schedule set forth
in the attached Attachment A. OWNER shall not begin construction until CITY sends a Notice
to Proceed. OWNER’s failure to meet the Construction Schedule or the Completion Deadline
shall be an event of default. OWNER may not change the Construction Schedule without the
CITY’s prior written approval, which approval shall be in the CITY’s reasonable discretion,
1. Written Cost Estimates, Construction Contracts and Construction Documents.
OWNER shall furnish CITY with the written cost estimates, construction contracts and
construction documents (collectively, the “Construction Documents”) all of which shall
describe the construction of the Required Improvements in sufficient detail so that CITY
can perform inspections. CITY shall review and approve written cost estimates and
determine that costs are reasonable prior to the commencement of construction.
2.Construction Inspections.
CITY will conduct progress and final inspections of construction of the project to ensure
that the work is done in accordance with the applicable building codes and the
Construction Documents. The construction of the project must pass a HUD Compliance
Inspection Report and any other applicable HUD-required inspections during the
construction period, along with any applicable final inspection approval from the CITY
building inspectors at the completion of the construction of the project.
B. Property Standards.
OWNER shall comply with the following as applicable during the construction of the Required
Improvements: (i) the Property Standards in 24 CFR Part 92.251(a), (ii) accessibility standards
under 24 CFR Part 92.251(a)(2)(i), (iii) any City property standards, and (iv) all other applicable
accessibility standards for the project.
The Project must also be maintained in compliance with the requirements of 24 CFR 92.251.
C. Construction Codes.
The Plans and construction for the Required Improvements shall (i) conform to all applicable
Federal, state, city and other local laws, ordinances, codes, rules and regulations, including
the HOME Regulations; (ii) meet all City building codes; (iii) meet the Energy Conservation
requirements as required by the State of Texas in Chapter 11 of the International Building
Code; (iv) if new construction, must conform to the Model Energy Code published by the
Council of American Building Officials; and (v) must pass a HUD Compliance Inspection Report
and inspection by City’s inspectors.
D. Lead-Based Paint Requirements.
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OWNER will comply with any applicable Federal lead-based paint requirements including lead
screening in buildings built prior to 1978 in accordance with 24 CFR Part 92.355 and 24 CFR
Part 35, subparts A, B, J, K, M, and R, and the Lead: Renovation, Repair and Painting Program
Final Rule, 40 CFR Part 745, in the construction and/or rehabilitation of the Required
Improvements.
Approval of Plans and Specifications by CITY Not Release of Responsibility.E.
Approval of the Plans by CITY shall not constitute or be deemed (i) to be a release of the
responsibility or liability of OWNER or any of its contractors or subcontractors, or their
respective officers, agents, employees and lower tier subcontractors, for the accuracy or the
competency of the Plans or the Construction Documents, including, but not limited to, any
related investigations, surveys, designs, working drawings and specifications or other
documents; or (ii) an assumption of any responsibility or liability by CITY for any negligent act,
error or omission in the conduct or preparation of any investigation, surveys, designs, working
drawings and specifications or other documents by OWNER or any of its architects,
contractors or subcontractors, and their respective officers, agents, employees and lower tier
subcontractors.
F.Contractor, Subcontractor and Vendor Requirements.
OWNER will use commercially reasonable efforts to ensure that all contractors or vendors
utilized by OWNER or subcontractors utilized by OWNER’s general contractor are
appropriately licensed and such licenses are maintained throughout the construction of the
Required Improvements and the operation of the project when applicable. OWNER shall
ensure that all contractors utilized by OWNER, subcontractors utilized by OWNER’s general
contractor in the construction of the Required Improvements, or vendors utilized by OWNER
in the operation of the project are not debarred or suspended from performing the
contractor’s, subcontractor’s or vendor’s work by the City, the State of Texas, or the Federal
government. For purposes of this AGREEMENT, the term “vendors" does not include
suppliers or materialmen. OWNER acknowledges that 2 CFR Part 200 forbids OWNER from
hiring or continuing to employ any contractor, subcontractor or vendor that is listed on the
Federal System for Award Management, www.sam.gov (“SAM"). OWNER must confirm by
search of SAM that all contractors, subcontractors or vendors are not listed by SAM as being
debarred, both prior to hiring and prior to submitting a Reimbursement Request which
includes invoices from any such contractor, subcontractor, or vendor. Failure to submit such
proofs of search shall be an event of default, if not cured within any applicable notice or cure
period. In the event that CITY determines that any contractor, subcontractor or vendor has
been debarred, suspended, or is not properly licensed, OWNER or OWNER’s general
contractor shall immediately cause such contractor, subcontractor or vendor to immediately
stop work on the project and OWNER shall not be reimbursed for any work performed by
such contractor, subcontractor or vendor. However, this section should not be construed to
be an assumption of any responsibility or liability by CITY for the determination of the
legitimacy, quality, ability, or good standing of any contractor, subcontractor or vendor.
G. Additional Construction Requirements.
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a)The Project must also be constructed in compliance with the accessibility requirements
of 24 CFR 8 which implements Section 504 of the Rehabilitation Act of 1973. Additionally,
if the Project is a “covered multifamily dwelling,” as defined in 24 CFR 100.201, the Project
must also meet the design and construction requirements of 24 CFR 100.205 regarding,
among other things, accessibility to the building and common areas.
In particular, OWNER must ensure that the construction of the units in the Project wiI
satisfy requirements for both physically accessible units and those accessible for tenants
with sensory (i.e. hearing or visual) impairments. Based on the {enter number of units in
words} (XX) unit Project, a minimum of {enter number of units in words} (X) units must be
physically accessible and a minimum of {enter number of units in words} (X) units must
be accessible for tenants with sensory impairments.
b) OWNER must prohibit the use of lead-based paint construction of the project.
C)OWNER will require its contractors to comply with all rules, regulations, ordinances, and
laws bearing on its conduct of work on the Project. OWNER will require its contractors to
stop construction if ground disturbance related to this Project results in the discovery of
any bones, artifacts, foundations, or other indications of past human occupation and
notify both the State Historic Preservation Office and CITY immediately.
H. Ongoing Maintenance of the Project.
OWNER must maintain the Project in compliance with all applicable state and local codes and
ordinances throughout the term of this Agreement. CITY has determined that the following
local codes apply to the ongoing occupancy and maintenance of the Project:
• 2018 the ICC Property Maintenance Code
Additionally, OWNER must maintain the Project in compliance with the Housing Quality
Standards (HCIS) in 24 CFR 982.401. In the event of a conflict between state and local codes
and Has, the stricter standard will apply.
As a matter of clarificationras applied by CITY, include compliance with the HUD’s Uniform
Physical Conditions Standards (UPCS). UPCS is generally a more stringent standard than Has,
but in the event a conflict on any given inspectable item or building component, the stricter
standard shall apply.
1.Property Management.
CITY must approve any professional property management company employed by OWNER
for the project. Property is managed by OWNER.
9. COMPLIANCE WITH OTHER FEDERAL REQUIREMENTS, APPLICABLE LAWS AND
REGULATIONS.
A. The CITY and OWNER agree to perform their duties arising pursuant to the Agreement in
compliance with the U.S. Department of Housing and Urban Development HOME Investment
Partnerships Program regulations at 24 CFR 92 and 2 CFR Part 200.
B. Other Federal Requirements.
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OWNER agrees to develop and operate the Project in full compliance with other related
federal requirements.
C. Compliance with All Applicable Laws and Regulations.
OWNER agrees to comply fully with all applicable laws and regulations that are currently in
effect or that are hereafter amended during the performance of this AGREEMENT. These
laws include, but are not limited to:
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HOME Investment Partnerships Act as set out above
Title VI of the Civil Rights Act of 1964 (42 U.S.C. Sections 2000d et seq.) including
provisions requiring recipients of federal assistance to ensure meaningful access by
person of limited English proficiency
The Fair Housing Act, Title VIII of the Civil Rights Act of 1968 (42 U.S.C. Sections 3601 et
seq.>
Executive Orders 11063, 11246 as amended by 11375 and 12086 and as supplemented
by Department of Labor regulations 41 CFR, Part 60
The Age Discrimination in Employment Act of 1967
The Age Discrimination Act of 1975 (42 U.S.C. Sections 6101 et seq.)
The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (42
U.S.C. Sections 4601 et seq. and 49 CFR Part 24) ("URA")
Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. Sections 794 et seq.) and 24 CFR
Part 8 where applicable
National Environmental Policy Act of 1969, as amended, 42 U.S.C. sections 4321 et seq.
("NEPA") and the related authorities listed in 24 CFR Part 58.
The Clean Air Act, as amended, (42 U.S.C. Sections 1251 et seq.) and the Clean Water Act
of 1977, as amended (33 U.S.C. Sections 1251 et seq.), related Executive Order 11738 and
Environmental Protection Agency Regulations at 40 CFR Part 15. In no event shall any
amount of the assistance provided under this AGREEMENT be utilized with respect to a
facility that has given rise to a conviction under the Clean Air Act or the Clean Water Act.
Immigration Reform and Control Act of 1986 (8 U.S.C. Sections 1101 et seq.) specifically
including the provisions requiring employer verifications of legal status of its employees
The Americans with Disabilities Act of 1990 (42 U.S.C. Sections 12101 et seq.), the
Architectural Barriers Act of 1968 as amended (42 U.S.C. sections 4151 et seq.) and the
Uniform Federal Accessibility Standards, 24 CFR Part 40, Appendix A
Regulations at 24 CFR Part 87 related to lobbying, including the requirement that
certifications and disclosures be obtained from all covered persons
Drug Free Workplace Act of 1988 (41 U.S.C. Sections 701 et seq.) and 24 CFR Part 23,
Subpart F
Executive Order 12549 and 24 CFR Part 5.105(c) pertaining to restrictions on participation
by ineligible, debarred or suspended persons or entities
Regulations at 24 CFR Part 882.708(c) pertaining to site and neighborhood standards for
new construction projects
Regulations at 24 CFR Part 983.6 for Site and Neighborhood Standards Review
Section 6002 of the Solid Waste Disposal Act, as amended by the Resource Conservation
and Recovery Act
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Guidelines of the Environmental Protection Agency at 40 CFR Part 247
For contracts and subgrants for construction or repair, Copeland "Anti-Kickback" Act (18
U.S.C. 874) as supplemented in 29 CFR Part 5
For construction contracts in excess of $2,000, and in excess of $2,500 for other contracts
which involve the employment of mechanics or laborers, Sections 103 and 107 of the
Contract Work Hours and Safety Standards Act (40 U.S.C. 327A 300) as supplemented by
29 CFR Part 5
Lead-Based Paint Poisoning Prevention Act (42 U.S.C. 4801 et seq.), as amended by the
Residential Lead-Based Paint Hazard Reduction Act of 1992 (42 U.S.C. 4851 et seq.) and
implementing regulations at 24 CFR Part 35, subparts A, B, M, and R
Regulations at 24 CFR Part 92, Home Investment Partnerships Program Final Rule
Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards, 2 CFR Part 200 et seq.
Federal Funding Accountability and Transparency Act of 2006, (Pub.L. 109-282, as
amended by Section 6205(a) of Pub.L. 110-252 and Section 3 of Pub.L. 113-101)
Federal Whistleblower Regulations, 10 U.S.C. 2409, 41 U.S.C. 4712, 10 U.S.C. 2324, 41
U.S.C. 4304 and 41 U.S.C. 4310.
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D. Agreement Not Constituting Commitment of Funds.
Notwithstanding any provision of this AGREEMENT, the Parties agree and acknowledge that
this AGREEMENT does not constitute a commitment of HOME Funds, and that such
commitment or approval may occur only upon satisfactory completion of environmental
review and receipt by CITY of an authorization to use grant funds from HUD under 24 CFR
Part 58
E.Affirmative Marketing.
OWNER must adopt and implement affirmative marketing procedures for the Project
consistent with the requirements of 24 CFR 92.351. OWNER must submit an Affirmative Fair
Housing Marketing Plan (AFHMP), using form HUD-935.2A, or on another such form as CITY
may reasonably require, for CITY review prior to marketing and leasing the HOME-assisted
units
The procedures and requirements must include methods for informing the public, owners
and potential tenants about fair housing laws and policies so as to ensure that all individuals
are given an equal opportunity to participate in the project without regard to sex, age, race,
color, creed, nationality, national origin, religion, handicap status, disability, familial status,
sexual orientation, gender identity, gender expression or transgender. The procedures shall
include methods to be used by OWNER to inform and solicit applications for tenancy from
person in the housing market area who are not likely to apply for the housing without special
outreach (e.g., through the use of community organizations, places of worship, employment
centers, fair housing groups, or housing counseling agencies.) The procedures and
requirements must designate an individual who will be responsible for marketing the project
and must establish a clear application screening plan. OWNER’s affirmative marketing
procedures must be submitted to CITY for approval prior to implementation; provided
however, CITY shall have no responsibility for affirmative marketing of the project.
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CITY reserves the right to require OWNER to update the Project’s AFHMP from time to time
to ensure it remains appropriate given potentially changing demographic characteristics of
the market area and is updated based on the operational experience with the Project.
OWNER shall keep records describing actions taken to affirmatively market the HOME Units
and the project sufficient to enable CITY to assess the results of the affirmative marketing.
Compliance with the Uniform Relocation Act: Displacement, Relocation, and Acquisition.F.
OWNER shall comply with the Uniform Administrative Requirements, Cost Principals and
Audit Requirements for Federal Awards, Final Guidance as described in 2 CFR Part 200.
OWNER will take all reasonable steps to minimize the displacement of persons (families,
individuals, businesses, nonprofit organizations, and farms) as a result of the Project.
Additionally, OWNER will assure compliance with appropriate relocation and real property
acquisition requirements as provided in 24 CFR 92.353.
G. Labor Standards - Compliance with Davis-Bacon Act.
The Project is subject to the requirements 24 CFR 92.354. Because there are fewer than
eleven (11) HOME-assisted housing units, the prevailing wage standards of the Davis-Bacon
Act do not apply.
As applicable, OWNER will ensure that its contracts for construction contain a provision
requiring that not less than the wages prevailing in the locality, as predetermined by the
Secretary of Labor pursuant to the Davis-Bacon Act (40 USC 276a-5), will be paid to al
laborers and mechanics employed in the development of affordable housing involved.
OWNER further will ensure that such agreements must also be subject to the overtime
provisions, as applicable, of the Work Hours and Safety Standards Act (40 USC 327-332).
OWNER shall comply with regulations issued under these Acts and with other federal laws
and regulations pertaining to labor standards and HUD Handbook 1344.1 (Federal Labor
Standards Compliance in Housing and Community Development Programs), as applicable.
CITY shall require certification as to compliance with the provisions of this section and will
monitor the Project and its records for such compliance before making any payment under
this Agreement.
H. Use of Contractors and Subcontractors
OWNER will ensure and maintain records demonstrating that none of the contractors or
subcontractors involved in the development of the Project are suspended, debarred, or
otherwise prohibited from participating in federally-assisted contracts. OWNER will further
ensure that its contractors include parallel provisions in their subcontracts, provide and
maintain records showing that subcontractors are not suspended, debarred, or otherwise
prohibited from participating in federally-assisted contracts.
OWNER understands and agrees that all terms of this AGREEMENT, whether regulatory or
otherwise, shall apply to any and all contractors, subcontractors and vendors of OWNER
which are in any way paid with HOME Funds or who perform any work in connection with the
project. OWNER shall cause all applicable provisions of this AGREEMENT to be included in
and made a part of any contract or subcontract executed in the performance of its obligations
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hereunder, including its obligations regarding the Affordability Requirements and the HOME
Regulations during the Affordability Period. OWNER shall monitor the services and work
performed by its contractors, subcontractors and vendors on a regular basis for compliance
with the Affordability Requirements, the HOME Regulations and Agreement provisions.
OWNER is responsible to cure all violations of the HOME Regulations committed by its
contractors, subcontractors or vendors. CITY maintains the right to insist on OWNER’s full
compliance with the terms of this AGREEMENT and the HOME Regulations and OWNER is
responsible for such compliance regardless of whether actions to fulfill the requirements of
this AGREEMENT or the HOME Regulations are taken by OWNER or by OWNER’s contractors,
subcontractors or vendors. OWNER acknowledges that the provisions of this section shall
survive the earlier termination or expiration of this AGREEMENT and be applicable for the
length of the Affordability Period and for 5 years thereafter.
OWNER shall, at a minimum, search at www.sam.gov to verify that each contractor and
subcontractor is not listed as an excluded party.
1.Certification Regarding Lobbying.
OWNER certifies that it will not and, to the best of its knowledge, has not used Federally
appropriated funds to pay any person or organization for influencing or attempting to
influence an officer or employee of any Federal agency, a member of Congress, officer or
employee of Congress, or an employee of a member of Congress in connection with obtaining
any Federal contract, grant or any other award. OWNER further agrees that it shall disclose
any lobbying with non-Federal funds that takes place in connection with obtaining any
Federal award.
J. OWNER Procurement Standards.
OWNER shall ensure that procurement of materials and services is done in a cost effective
manner. OWNER shall comply with all applicable federal, state and local laws, regulations,
and ordinances for making procurements under this AGREEMENT. OWNER shall establish
written procurement procedures to ensure that materials and services are obtained in a cost
effective manner
K. Cost Principles/Cost Reasonableness.
The eligibility of costs incurred for performance rendered shall be determined in accordance
2 CFR Part 200.402 through 2 CFR Part 200.405, as applicable, regarding cost reasonableness
and allocability.
L.Financial Management Standards.
OWNER agrees to adhere to the accounting principles and procedures required in 2 CFR Part
200, as applicable, utilize adequate internal controls, and maintain necessary supporting and
back-up documentation for all costs incurred in accordance with 2 CFR Part 200.302 and Part
200.303
M. Uniform Administrative Requirements.
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OWNER will comply with the Uniform Administrative Requirements, Cost Principles, and
Audit Requirements for Federal Awards in 2 CFR Part 200, as applicable, or any reasonably
equivalent procedures and requirements that CITY may require.
N. Compliance with FFATA and Whistleblower Protections.
OWNER shall provide CITY with all necessary information for CITY to comply with the
requirements of 2 CFR 300(b), including provisions of the Federal Funding Accountability and
Transparency Act (“FFATA") governing requirements on executive compensation and
provisions governing whistleblower protections contained in 10 U.S.C. 2409, 41 U.S.C. 4712,
10 U.S.C. 2324, 41 U.S.C. 4304 and 41 U.S.C. 4310.
OWNER shall provide CITY its DUNS number prior to the payment of any HOME Funds.
O. Internal Controls.
In compliance with the requirements of 2 CFR 200.303, OWNER shall:
1.Establish and maintain effective internal control over the HOME Funds that provides
reasonable assurance that OWNER is managing the HOME Funds in compliance with
federal statutes, regulations, and the terms and conditions of this AGREEMENT. These
internal controls shall be in compliance with guidance in “Standards for Internal Control
in the Federal Government" issued by the Comptroller General of the United States or the
“Internal Control Integrated Framework”;
2. Comply with federal statutes, regulations, and the terms and conditions of this
AGREEMENT;
3. Evaluate and monitor OWNER’s compliance with statutes, regulations and the terms and
conditions of this AGREEMENT;
4. Take prompt action when instances of noncompliance are identified including
noncompliance identified in audit findings; and
5. Take reasonable measures to safeguard protected personally identifiable information and
other information that HUD or CITY designates as sensitive or OWNER considers sensitive
consistent with applicable federal, state, local and tribal laws regarding privacy and
obligations of confidentiality.
P. Copyright and Patent Rights.
No reports, maps, or other documents produced in whole or in part under this AGREEMENT
shall be the subject of an application for copyright by or on behalf of OWNER. HUD and CITY
shall possess all rights to invention or discovery, as well as rights in data which may arise as a
result of OWNER’s performance under this AGREEMENT.
Q. OWNER agrees to ensure that all HOME-assisted housing or housing identified as match for
the HOME program meets all affordability requirements identified in 24 CFR 92 Subpart F as
applicable.
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R.If it is determined that the use of the funding provided by the CITY does not meet the
requirements of the U.S. Department of Housing and Urban Development HOME Investment
Partnerships Program, the OWNER shall reimburse the CITY for the costs determined to be
disallowed under the U.S. Department of Housing and Urban Development HOME Investment
Partnership Program regulations.
S. OWNER shall comply with all applicable Federal laws and regulations at 24 CFR 92 subpart H.
Subpart H prescribes procedures for compliance in the following areas: nondiscrimination
and equal opportunity, affirmative marketing, displacement and relocation, labor relations
and conflict of interest.
T. OWNER agrees that all housing assisted under this agreement will meet the property
standards requirements in 24 CFR 92.251 and the lead-based paint requirements in 24 CFR
92.355 upon project completion.
U. OWNER agrees to comply with all project requirements in 24 CFR Part 92, Subpart F.
V. OWNER certifies that it is not currently listed on the General Services Administration's List of
Parties Excluded from Federal Procurement or Non-procurement Programs in accordance
with Executive Orders 12549 and 12689 and will not enter into agreements to expend Federal
funds with OWNERs that are currently listed.
W. OWNER agrees to comply with the maximum per unit subsidy limits, underwriting
requirements and subsidy layering limits in 24 CFR 92.250.
X. OWNER agrees to comply with all applicable Federal laws, laws of the State of Texas and
ordinances of the City of Denton.
10. REPRESENTATIONS
A. The CITY is providing funding to the OWNER in order to promote the development of
affordable housing for low-income households. Use of funds for programming will meet this
stated goal.
B. The CITY is the only agent authorized to designate changes to the Program Budget or to
approve specific projects and programs authorized pursuant to the non-administration
portion of the Program Budget.
C.
D.
OWNER assures and guarantees that it possesses the legal authority, pursuant to any proper,
appropriate and official motion, resolution or action passed or taken, to enter into this
Agreement.
The person or persons signing and executing this Agreement on behalf of OWNER, do hereby
warrant and guarantee that he, she, or they have been fully authorized by OWNER to execute
this Agreement on behalf of OWNER and to validly and legally bind OWNER to all terms,
performances and provisions herein set forth.
CITY shall have the right, at its option, to either temporarily suspend or permanently
terminate this Agreement if there is a dispute as to the legal authority of either OWNER or
the person signing the Agreement to enter into this Agreement. OWNER is liable to CITY for
E
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any money it has received from CITY for performance of the provisions of this Agreement if
CITY has suspended or terminated this Agreement for the reasons enumerated in this section.
F.OWNER agrees that the funds and resources provided OWNER under the terms of this
Agreement will in no way be substituted for funds and resources from other sources, nor in
any way serve to reduce the resources, services, or other benefits which would have been
available to, or provided through, OWNER had this Agreement not been executed.
11. PROGRAM INCOME
A. CHDO: Any program income/proceeds from the project will be considered CHDO proceeds
that may be retained by the OWNER and must be used in conformance with 24 CFR
§92.300(a)(2), for other housing activities to benefit low-income families.
B. HOME program income is defined as all fees and interest payments on HOME assisted
units/projects and any interest income on deposited HOME funds or program proceeds
collected by the OWNER. Program income may be retained by the OWNER to be used for
HOME-eligible activities included in the Work Statement included herein as Attachment B.
C.Use of the funds on projects or programs other than those identified in this Agreement, must
be approved in writing by the CITY. Any income retained and used by the OWNER must be
available to the CITY as a matching contribution for the HOME program. Upon request,
OWNER will approve appropriate certifications stating that funding is available as a HOME
program match to the CITY.
12. MAINTENANCE OF RECORDS
A.OWNER agrees to maintain records that will provide accurate, current, separate, and
complete disclosure of the status of the funds received pursuant to this Agreement and
pursuant to any other applicable Federal and/or State regulations establishing standards for
financial detailed support and justification for each expenditure. Nothing in this section shall
be construed to relieve OWNER of fiscal accountability and liability under any other provision
of this Agreement or any applicable law. OWNER shall include the substance of this provision
in all subcontracts.
B. OWNER agrees to retain all books, records, documents, reports, and written accounting
policies and procedures pertaining to the operation of programs and expenditures of funds
pursuant to this Agreement for the period of time and under the conditions specified by CITY.
C. Nothing in the above subsections shall be construed to relieve OWNER of responsibility for
retaining accurate and current records, which clearly reflect the level and benefit of services,
provided pursuant to this Agreement.
D.At any reasonable time and as often as CITY may deem necessary, the OWNER shall make
available to CITY, or any of its authorized representatives, all of its records and shall permit
CITY, or any of its authorized representatives to audit, examine, make excerpts and copies of
such records, and to conduct audits of all contracts, invoices, materials, payrolls, records of
personnel, conditions or employment and all other data relating to the program requested
by said representatives.
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E.The OWNER shall give the City of Denton, the U.S. Department of Housing and Urban
Development, or any of their duly authorized representatives, access to and the right to
examine all books, accounts, records, reports, files and other papers belonging to or in use
by the OWNER pertaining to this Agreement. Such rights to access shall continue as long as
the OWNER is required to retain the records.
13. REPORTS AND INFORMATION
A. OWNER shall provide quarterly financial and beneficiary reports that shall contain such
records, data and information as CITY may request and deem pertinent to matters covered
by this Agreement. OWNER shall provide any additional information as requested by the CITY
within 10 days.
B. An audit must be conducted in accordance with 2 CPR Part 200 as applicable. OWNER shall
submit a copy of said audit to the Community Development Division within thirty days of
receipt of the completed report.
C. General Requirements.
OWNER agrees to provide reports to CITY and to maintain records documenting compliance
with this Agreement, the loan documents and regulatory agreements, the HOME rule, and al
other applicable federal, state, and local laws and regulations. OWNER also agrees to provide
CITY, HUD, HUD’s Office of Inspector General, the Comptroller General of the United States
(aka the U.S. Government Accountability Office or “GAO"), or their representatives access to
the Project and its records for the purpose of monitoring OWNER’s compliance with
applicable requirements.
D. Reports
OWNER shall submit periodic reports to CITY on the progress and performance of the Project.
CITY reserves the right to unilaterally alter, supplement, or otherwise modify the frequency
or content of required reports as needed to maintain adequate oversight of the Project,
address changes to HOME regulations, or to address findings related to noncompliance by
the Project.
Initially, CITY may require reports as follows:
1.Prior to the commencement of construction, OWNER shall report not less than quarterly
on progress toward commencement of construction. Quarterly reports will be due on the
15th of the month following the end of the prior quarter (e.g. by April 15th reports on the
first quarter are due). During the construction period, OWNER shall report monthly on
progress, submit invoices being paid, and provide evidence of appropriate lien waivers to
CITY regardless of whether OWNER is requesting a disbursement from CITY during that
month;
2. Upon reaching Stabilized Occupancy, OWNER shall report on the occupancy and financial
status of the Project not less than annually.
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Annual reports shall include a HOME Rental Project Compliance Report, utility allowance
documentation, an Affirmative Fair Housing Marketing Plan, Tenant Selection Policy, and
a copy of the Lease Agreement. Additionally, OWNER shall submit copies of its annual
project audit, prepared by an independent certified public accountant, within one
hundred-twenty (120) days of the end of its fiscal year.
All reports pertaining to leasing and occupancy shall include, but will not be limited to, a
statistical report reflecting the actual number of persons served, the types of services
provided and the actual number of persons receiving those services, and a narrative
description of assistance provided, in addition to the aforementioned statistics, that
includes a statement regarding the progress made toward meeting performance goals.
E. Change in Reporting Requirements and Forms.
CITY retains the right to change reporting requirements and forms at its reasonable
discretion. CITY will notify OWNER in writing at least 30 days prior to the effective date of
such change, and the Parties shall execute an amendment to the Agreement reflecting such
change if necessary.
F.Recordkeeping and Inspections
OWNER shall maintain detailed records of all persons served pursuant to this Agreement.
Representatives of CITY, HUD, or their designees may examine any records or information
accumulated pursuant to this Agreement.
During the Period of Affordability, CITY will conduct on-site inspections to verify compliance
with 24 CFR 92.252 as required by 24 CFR 504. All confidential information shall be treated
as such by all aforementioned CITY or HUD representatives or designees.
OWNER shall maintain administrative and financial records as required by 24 CFR 92.508,
applicable to the activities to be carried out under this agreement, including but not
necessarily limited to:
1. Property description and location;
2. Records regarding project requirements that applies for the duration of the period of
affordability (all of Subpart F of 24 CFR);
3. Documentation that the amount of investment in each housing unit is in compliance with
the requirements in 24 CFR 92.205(c) and maximum subsidy limits in 24 CFR 92.250;
4. Information about contractors, vendors and other lenders to include but not necessarily
be limited to verification of non-debarment and suspension, verification of qualifications
and experience, legally binding contracts and agreements, invoices and payment records
and related correspondence. (See: 24 CFR Part 24);
5. Financial information including, but not necessarily limited to, audits and related
correspondence, accounting and financial records, indirect cost analyses, and operating
budgets;
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6.
7.
Project records in accordance with 24 CFR 92.508(a)(3) that demonstrate that each HOME
assisted renter and each housing unit leased meets the requirements of the HOME
program .
Other Records that include documentation of compliance with other federal
requirements in accordance with 24 CFR 92.508 that includes the following requirements
to the extent applicable to the funded activity:
•
•
•
•
•
•
Documentation of efforts to affirmatively further fair housing;
If applicable, records documenting compliance with federal law regarding
displacement, relocation and property acquisition in accordance with the URA;
Records demonstrating compliance with labor requirements set out in 24 CFR 92.354,
including contract provisions and payroll records (as applicable);
Records concerning lead-based paint set out in 24 CFR Part 35;
Records supporting requests for waivers of the conflict of interest prohibition set out
in 24 CRF 92.356 (if applicable);
Records demonstrating compliance with flood insurance requirements under 24 CFR
92.352
8. Records related to any decision to terminate the lease of a tenant or refuse to renew the
lease of a tenant, including documentation of the specific lease violations leading to
termination or non-renewal.
G. Records Retention
OWNER shall retain all applicable administrative and project records and records pertinent
to other federal requirements, as specified in Section 92.508 of the HOME Final Rule, for a
period of five (5) years after the termination of all activities funded under this agreement. In
this context funded activities extend throughout the period of affordability as stipulated in
24 CFR 92.252 and 92.508.
Records for non-expendable property acquired with HOME Program Funds shall be retained
for five (5) years after the period of affordability.
Notwithstanding the above, if there are litigation, claims, audits, negotiations or other actions
that involve any of the records cited and that have commenced before the expiration of the
five (5) year period, such records must be retained until completion of the actions and
resolution of all issues, or the expiration of the five (5) year period, whichever occurs later.
H.Inspections
OWNER will provide CITY, applicable federal authorities, and their representatives with
access to the Project for the purposes of conducting physical inspections, including individual
apartments, common spaces, and the grounds. CITY will conduct periodic physical inspections
during construction to ensure the Project is progressing and construction activity meets
applicable property standards. After construction completion, CITY will inspect the Project
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annually or on another schedule it determines to ensure that the Project is being maintained
in compliance with all appropriate property standards.
1.CITY Reserves the Right to Audit.
CITY reserves the right to perform an audit of OWNER’s project operations and finances at
any time during the term of this AGREEMENT and during the Affordability Period and for 5
years thereafter, if CITY determines that such audit is necessary for CITY’s compliance with
the HOME Regulations or other CITY policies, and OWNER agrees to allow access to all
pertinent materials as described herein. If such audit reveals a questioned practice or
expenditure, such questions must be resolved within 15 business days after notice to OWNER
of such questioned practice or expenditure. If questions are not resolved within this period,
CITY reserves the right to withhold further funding under this and/or other Agreement(s) with
OWNER. IF AS A RESULT OF ANY AUDIT IT IS DETERMINED THAT OWNER HAS FALSIFIED ANY
DOCUMENTATION OR MISUSED, MISAPPLIED OR MISAPPROPRIATED HOME FUNDS OR
SPENT HOME FUNDS ON ANY INELIGIBLE ACTIVITIES, OWNER AGREES TO REIMBURSE CITY
THE AMOUNT OF SUCH MONIES PLUS THE AMOUNT OF ANY SANcrioNS, PENALTY OR OTHER
CHARGE LEVIED AGAINST CITY BY HUD BECAUSE OF SUCH ACTIONS.
14. INSURANCE
A. OWNER shall observe sound business practices with respect to providing such bonding and
insurance as would provide adequate coverage for services offered under this Agreement.
B.The premises on and in which the activities described in Attachment A are conducted, and
the employees conducting these activities, shall be covered by premise liability insurance,
commonly referred to as "Owner/Tenant" coverage with CITY named as an additional
insured. Upon request of OWNER, CITY may, at its sole discretion, approve alternate
insurance coverage arrarlgernents.
C. OWNER will comply with applicable workers’ compensation statutes and will obtain
employers' liability coverage where available and other appropriate liability coverage for
program participants, if applicable.
D.OWNER will maintain adequate and continuous liability insurance on all vehicles owned,
leased or operated by OWNER. All employees of OWNER who are required to drive a vehicle
in the normal scope and course of their employment must possess a valid Texas driver's
license and automobile liability insurance. Evidence of the employee's current possession of
a valid license and insurance must be maintained on a current basis in OWNER's files.
E. Actual losses not covered by insurance as required by this section are not allowable costs
under this Agreement, and remain the sole responsibility of OWNER.
F. The policy or policies of insurance shall contain a clause which requires that CITY and OWNER
be notified in writing of any cancellation or change in the policy at least thirty (30) days prior
to such change or cancellation.
G. Insurance will be carried on all housing units under construction and until such time as the
new homeowner takes possession and obtains homeowner insurance.
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15. EQUAL OPPORTUNITY
A. During the performance of this Agreement, the OWNER is subject to Executive Order 11246,
as amended, and, therefore, agrees to the following:
1.The OWNER will not discriminate against any employee or applicant for employment
because of race, color, religion, sex, national origin, or familial status. The OWNER will
take affirmative action to ensure that applicants who are employed are treated during
employment without regard to their race, color, religion, sex, national origin, or familial
status, concerning such employment, upgrading, demotion, or transfer; recruitment or
recruitment advertising; layoff or termination; rates of pay or their apprenticeship. The
OWNER agrees to post in conspicuous places, available to both employees and applicants
for employment, notices to be provided by the CITY setting forth provisions of this
nondiscrimination clause.
2. The OWNER, in all solicitations or advertisements for employees placed by national origin,
or familial status.
B In accordance with Sections 24 CFR 92.350 and 92.351 of the HOME regulations, except for
specific exceptions allowing elderly designated projects to apply age restrictions, no person
shall on the ground of race, color, religion, sex, disability, familial status, national origin, or
age be excluded from participation in, be denied the benefits of, or be subjected to
discrimination under any program activity funded in whole or in part from HOME funds. In
addition, OWNER shall develop, operate, and maintain the Project in accordance with the
following:
1.The requirements of the Fair Housing Act (42 U.S.C. 3601-20) and implementing
regulations at 24 CFR Part 100; Executive Order 11063, as amended by Executive Order
12259 (3 CFR 1958 B1963 Comp., P. 652 and 3 CFR1980 Comp., P. 307) (Equal Opportunity
in Housing) and implementing regulations at 24 CFR Part 107; and of the Civil Rights Act
of 1964 (42 U.S. C. 200ad) (Nondiscrimination in Federally Assisted Programs) and
implementing regulations issued at 24 CFR Part 1;
The prohibitions against discrimination on the basis of age under the Age Discrimination
Act of 1975 (42 U.S.C. 6101-07) and implementing Regulations at 24 CFR Part 146, and
the prohibitions against discrimination against handicapped individuals under Section 504
of the Rehabilitation Act of 1973 (29 U.S.C. 794) and implementing regulations at 24 CFR
Part 8;
2.
3 The requirements of 24 CFR 5.105(a)(2) requiring that HUD-assisted housing be made
available without regard to actual or perceived sexual orientation, gender identity, or
marital status and prohibiting OWNERs (or their agents) from inquiring about the sexual
orientation or gender identity of an applicant for, or occupant of, HUD-assisted housing
for the purpose of determining eligibility for the housing or otherwise making such
housing available. This prohibition on inquiries regarding sexual orientation or gender
identity does not prohibit any individual from voluntarily self-identifying sexual
orientation or gender identity;
31
4. The requirements of Executive Order 11246 (3 CFR 1964-65, Comp., p. 339) (Equal
Employment Opportunity) and the implementing regulations issued at 41 CFR Chapter 60;
The nondiscrimination requirements of section 282 of the HOME Investment Partnerships
Act at title II of the Cranston-Gonzales National Affordable Housing Act, as amended;
5. The requirements of Section 3 of the Housing and Urban Development Act of 1968 (U.S.C.
170lu) as evidenced by submission of Form HUD-60002 which the OWNER shall complete
and return to CITY within ninety days of the date of this agreement, that:
•To the greatest extent feasible, opportunities for training and employment arising in
connection with the planning and carrying out of any project assisted with HOME
funds be given to low-income persons residing within the unit of general local
government or the metropolitan area as determined by HUD, in which the project is
located; and
To the greatest extent feasible, contracts for work to be performed in connection with
any such project be awarded to business concerns, including but not limited to
individuals or firms doing business in the field of planning, consulting, design,
architecture, building construction, rehabilitation, maintenance, or repair, which are
located in or owned in substantial part by persons residing in the same metropolitan
area as the project.
0 14.11.2 OWNER Responsibilities for Section 3 Requirements.
CITY and OWNER understand and agree that compliance with the provisions of
Section 3, the regulations set forth in 24 CFR Part 135, and all applicable rules and
orders of HUD shall be a condition of the federal financial assistance provided to
the project binding upon CITY and OWNER, and their respective successors,
assigns, contractors and subcontractors. Failure to fulfill these requirements shall
subject OWNER and its contractors and subcontractors and their respective
successors and assigns to those sanctions specified by the grant agreement
through which federal assistance is provided and to such sanctions as are specified
by 24 CFR Part 135. OWNER’s responsibilities include:
0
0
0
Implementing procedures to notify Section 3 residents and business concerns
about training, employment, and contracting opportunities generated by Section
3 covered assistance;
Notifying potential contractors working on Section 3 covered projects of their
responsibilities;
Facilitating the training and employment of Section 3 residents and the award of
contracts to Section 3 business concerns;
o Assisting and actively cooperating with the Neighborhood Services Department in
making contractors and subcontractors comply;
o Refraining from entering into contracts with contractors that are in violation of
Section 3 regulations;
32
o Documenting actions taken to comply with Section 3; and
o Submitting Section 3 Annual Summary Reports (form HUD-60002) in accordance
with 24 CFR Part 135.90.
o Section 3 Reporting Requirements.
In order to comply with the Section 3 requirements, OWNER must submit the
forms Section 3 Reporting Forms and take the following actions:
•Report to the CITY all applicants for employment, and all applicants for
employment by contractors and any subcontractors on a quarterly basis. This
shall include name, address, zip code, date of application, and status
(hired/not-hired) as of the date of the report.
•Advertise available positions to the public for open competition and provide
documentation to CITY with the quarterly report that demonstrates such open
advertisement, in the form of printout of Texas Workforce Commission
posting, copy of newspaper advertisement, copy of flyers and listing of
locations where flyers were distributed, and the like.
• Report to the CITY all contracts awarded by contractors and any
subcontractors on a quarterly basis. This shall include name of contractor
and/or subcontractor, address, zip code, and amount of award as of the date
of the report.
6.Subcontracting with Small and Minority Firms, Women’s Business Enterprises: The
requirements of Executive Orders 11625 and 12432 (concerning Minority Business
Enterprise), and 12138 (concerning Women's Business Enterprise). OWNER must make
efforts to encourage the use of minority and women's business enterprises in connection
with HOME-funded activities. OWNER will cooperate with CITY in its minority outreach
program to ensure the inclusion, to the maximum extent possible, of minorities and
women, and entities owned by minorities and women, in the procurement of property
and services including; without limitation, real estate firms, construction firms, financial
institutions, investment banking firms, underwriters, accountants, and providers of legal
services
• in order to comply with the reporting requirements of 24 CFR Part 92.508 (a)(7)(ii),
OWNER must submit the form Contract and Subcontract Activity Reporting Form for
each contract or subcontract with a value of $ 10,000 or more paid, or to be paid, with
HOME funds. This form shall be submitted with the final Reimbursement Request.
7. The nondiscrimination requirements of Section 282 of the HOME Investment Partnerships
Act at title II of the Cranston-Gonzales National Affordable Housing Act, as amended.
No Discrimination in Employment during the Performance of this AGREEMENT.
Non-discrimination: OWNER agrees to post notices containing this policy against
discrimination in conspicuous places available to applicants for employment and
employees. All solicitations or advertisements for employees, placed by or on the behalf
33
of the OWNER, shall state that all qualified applicants will receive consideration for
employment without regard to race, color, national origin, religion, or sex.
During the performance of this AGREEMENT OWNER agrees to the following provision,
and will require that its contractors, subcontractors and vendors also comply with such
provision by including it in all contracts with its contractors and vendors:
[Contractor’s, Subcontractor’s or Vendor’s Name] will not unlawfully discriminate against
any employee or applicants for employment because of race, color, sex, gender, religion,
national origin, familial status, disability or perceived disability, sexual orientation, gender
identity, gender expression or transgender. [Contractor’s, Subcontractor’s or Vendor’s
Name] will take affirmative action to ensure that applicants are hired without regard to
race, color, sex, gender, religion, national origin, familial status, disability or perceived
disability, sexual orientation, gender identity, gender expression or transgender and that
employees are treated fairly during employment without regard to their race, color, sex,
gender, religion, national origin, familial status, disability or perceived disability, sexual
orientation, gender identity, gender expression or transgender. Such action shall include,
but not be limited to, the following: employment, upgrading, demotion or transfer,
recruitment or recruitment advertising, layoff or termination, rates of pay or other forms
of compensation, and selection for training, including apprenticeship.
8. OWNER’s Contractors and the ADA.
In accordance with the provisions of the Americans With Disabilities Act of 1990 ("ADA"),
OWNER warrants that it will not unlawfully discriminate on the basis of disability in the
provision of services to the general public, nor in the availability, terms and/or conditions
of employment for applicants for employment with, or employees of OWNER. OWNER
WARRANTS IT WILL FULLY COMPLY WITH ADA’S PROVISIONS AND ANY OTHER
APPLICABLE FEDERAL, STATE AND LOCAL LAWS CONCERNING DISABILITY AND WILL
DEFEND, INDEMNIFY AND HOLD CITY HARIVILESS AGAINST ANY CLAIMS OR ALLEGATIONS
ASSERTED BY THIRD PARTIES, coNTRAcroRS, SUBCONTRACTORS OR VENDORS AGAINST
CITY ARISING OUT OF OWNER’S AND/OR ITS coNTRAcroRs’, SUBCONTRACTORS’,
VENDORS’, AGENTS’ OR EMPLOYEES’ ALLEGED FAILURE TO COMPLY WITH THE ABOVE-
REFERENCED LAWS CONCERNING DISABILITY DISCRIMINATION IN THE PERFORMANCE OF
THIS AGREEMENT.
16. CONFLICr OF INTEREST AND VIOLATIONS OF CRIMINAL LAW
A.OWNER covenants that neither it nor any member of its governing body presently has any
interest, direct or indirect, which would conflict in any manner or degree with the
performance of services required to be performed under this Agreement. OWNER further
covenants that in the performance of this Agreement, no person having such interest shall
be employed or appointed as a member of its governing body.
B. OWNER further covenants that no member of its governing body or its staff, OWNERs or
employees shall possess any interest in or use this position for a purpose that is or gives the
34
appearance of being motivated by desire for private gain for themselves, or others,
particularly those with which they have family, business, or other ties.
C.No officer, member, or employee of CITY and no member of its governing body who exercises
any function or responsibilities in the review or approval of the undertaking or carrying out
of this Agreement shall participate in any decision relating to the Agreement which affects
his/her personal interest or the interest in any corporation, partnership, or association in
which he/she has direct or indirect interest.
D. No officer, employee, agent, or consultant of OWNER (known as covered persons) may
occupy a HOME-assisted affordable housing unit in the Project. However, this provision does
not apply to an employee or agent of OWNER who occupies a housing unit in the Project as
a project manager or maintenance worker.
Notwithstanding, CITY may approve a waiver to allow a covered person to occupy a unit in
the Project based on a written request from OWNER if, in CITY’s sole discretion, a waiver
would be appropriate under the provisions of 24 CFR 92.356(f)(2).
While the conflict of interest provisions in 24 CFR 92.356 do not technically apply to OWNER’s
procurement of goods and services associated with the development or operation of the
Project, OWNER agrees to notify CITY in writing and seek CITY approval prior to entering into
any contract with an entity owned in whole or in part by a covered person or an entity owned
or controlled in whole or in part by OWNER, the General Partner, any of the underlying
individual OWNERs of the General Partner, or any of the Guarantors. CITY will review the
proposed contract to ensure that the contractor is qualified and that the costs are reasonable.
Approval of an identity of interest contract will be in CITY’s sole discretion.
17. POLITICAL OR SECIARIAN AcrlVITY
A. None of the performance rendered hereunder shall involve any political activity (including,
but not limited to, any activity to further the election or defeat of any candidate for public
office) or any activity undertaken to influence the passage, defeat or final content of
legislation.
B. None of the performance rendered hereunder shall involve or benefit in any, manner any
sectarian or religious activity.
18. WARRANTIES
OWNER represents and warrants that:
A. All information, reports and data heretofore or hereafter requested by CITY and furnished to
CITY, are complete and accurate as of the date shown on the information, data, or report,
and, since that date, have not undergone any significant change without written notice to
CITY
B. Any supporting financial statements heretofore requested by CITY and furnished to that since
said date, there has been no material change, adverse or otherwise, in the financial condition
of OWNER.
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C. No litigation or legal proceedings are presently pending or threatened against OWNER.
D. None of the provisions herein contravenes or is in conflict with the authority under which
OWNER is doing business or with the provisions of any existing indenture or agreement of
OWNER.
E. OWNER has the power to enter into this Agreement and accept payments hereunder, and
has taken all necessary action to authorize such acceptance under the terms and conditions
of this Agreement.
F. None of the assets of OWNER is subject to any lien or encumbrance of any character, except
for current taxes not delinquent, except as shown in the financial statements furnished by
OWNER to CITY.
G. Each of these representations and warranties shall be continuing and shall be deemed to have
been repeated by the submission of each request for payment.
19. COVENANTS
A. OWNER agrees to take appropriate measures to enforce the affordability requirements on
property assisted with HOME funds. Property liens or other forms of enforcement, with the
City of Denton as Trustee, must remain with the property for the required affordability
period
B.During the period of time that payment may be made hereunder and so long as any payments
remain unliquidated, OWNER shall not, without the prior written consent of the Housing
Programs Manager or his/her authorized representative:
(1) Mortgage, pledge, or otherwise encumber or suffer to be encumbered, any of the assets
of OWNER now owned or hereafter acquired by it, or permit any pre-existing mortgages,
liens, or other encumbrances to remain on, or attached to, any assets of OWNER which
are allocated to the performance of this Agreement and with respect to which CITY has
ownership hereunder.
(2) Sell, assign, pledge, transfer or otherwise dispose of accounts receivables, notes or claims
for money due or to become due.
(3) Sell, convey, or lease all or substantial part of its assets.
(4) Make any advance or loan to, or incur any liability for any other firm, person, entity or
corporation as guarantor, surety, or accommodation endorser.
(5) Sell, donate, loan or transfer any equipment or item of personal property purchased with
funds paid to OWNER by CITY, unless CITY authorizes such transfer.
C. OWNER agrees, upon written request by CITY, to require its employees to attend training
sessions sponsored by the Community Development Division.
20. MONITORING AND EVALUATION
A. CITY shall perform on-site monitoring of OWNER’s performance under this Agreement.
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B. OWNER understands and agrees that it will be subject to monitoring by CITY for compliance
with the HOME Regulations, the terms of this AGREEMENT and the Loan Documents during
the Affordability Period. OWNER will provide reports and access to project files as requested
by CITY during the Affordability Period and for 5 years after it ends.
C. OWNER agrees to cooperate fully with CITY in the development, implementation and
maintenance of record-keeping systems and to provide data determined by CITY to be
necessary for CITY to effectively fulfill its monitoring and evaluation responsibilities.
D. OWNER agrees to cooperate in such a way so as not to obstruct or delay CITY in such
monitoring and to designate one of its staff members to coordinate the monitoring process
as requested by CITY staff.
E. CITY shall provide a written evaluation of contract performance to the OWNER within 30 days
of the monitoring.
F. Within 60 days of notification by the CITY, the OWNER shall provide complete responses
include a statement acknowledging any corrective action required to be taken due to City of
Denton monitoring findings and concerns.
G. OWNER shall submit copies of any fiscal, management, or audit reports by any of OWNER’s
funding or regulatory bodies to CITY within five (5) working days of receipt by OWNER.
H.Representatives of CITY, HUD, HUD Office of the Inspector General, and the United States
Comptroller General shall have access during regular business hours, upon at least 48 hours
prior notice, to OWNER’s offices and records and to OWNER’s officers and agents that are
related to the use of the HOME Funds and the requirements of the HOME Regulations during
the Affordability Period, and to OWNER’s officers, agents, employees, contractors,
subcontractors and vendors for the purpose of such monitoring
1.In addition to other provisions of this AGREEMENT regarding frequency of monitoring, CITY
reserves the right to perform desk reviews or on-site monitoring of OWNER’s compliance with
the terms and conditions of this AGREEMENT and the Loan. After each monitoring visit, CITY
shall provide OWNER with a written report of the monitor’s findings. If the monitoring report
notes deficiencies in OWNER’s performance, the report shall include requirements for the
timely correction of said deficiencies by OWNER. Failure by OWNER to take the action
specified in the monitoring report may be cause for suspension or termination of this
AGREEMENT as provided herein, or CITY may take all actions allowed in the Loan Documents.
J.OWNER shall annually provide to CITY the results of any state or federal monitoring related
to the project including any monitoring by TDHCA. Such results shall be submitted annually
to CITY with the submission of its annual audit and financial statements.
K. This shall be applicable for the duration of the Affordability Period and shall survive the earlier
termination or expiration of this AGREEMENT.
21. DIRECrORS' MErrINGS
A. OWNER shall ensure that the CITY is notified of all meetings, regular and special called, of the
board of directors. Notice should be received by the CITY at least 72 hours prior to the
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meeting. Such notice shall include an agenda and a brief description of the matters to be
discussed.
B. OWNER understands and agrees that CITY representatives shall be afforded access to all of
the Board of Directors' meetings.
C. Minutes of all meetings of OWNER's governing body shall be available to CITY within ten (10)
working days of approval.
22. NEPOTISM
OWNER shall not employ in any paid capacity any person who is a member of the immediate
family of any person who is currently employed by OWNER, or is a member of OWNER's
governing board. The term "member of immediate family" includes: wife, husband, son,
daughter, mother, father, brother, sister, in-laws, aunt, uncle, nephew, niece, step-parent, step-
child, half-brother and half-sister.
23. SUSPENSION OF FUNDING
A.Upon determination by CITY of OWNER's failure to timely and properly perform each of the
requirements, time conditions and duties provided herein, CITY, without timiting any rights it
may otherwise have, may, at its discretion, and upon ten (10) working days written notice to
OWNER, withhold further payments to OWNER. Such notice may be given by mail to the
Executive Officer and the Board of Directors of OWNER. The notice shall set forth the default
or failure alleged, and the action required for cure.
B.The period of such suspension shall be of such duration as is appropriate to accomplish
corrective action, but in no event shall it exceed thirty (30) calendar days. At the end of the
suspension period, if CITY determines the default or deficiency has been satisfied, OWNER
may be restored to full compliance status and paid all eligible funds withheld or impounded
during the suspension period. If, however, CITY determines that OWNER has not come into
compliance, this Agreement may be terminated under section 23 of this Agreement.
24. TERMINATION
A.The CITY shall have the right to terminate this Agreement, in whole or in part, at any time
whenever the CITY determines that the OWNER has failed to comply with any term of this
Agreement. The CITY shall notify the OWNER in writing thirty (30) days prior to the date of
termination, the effective date of such termination, and in the case of partial termination,
the portion of the Agreement to be terminated. Property shall be subject to disposition.
B. The CITY shall have the right to terminate this Agreement for convenience, in whole or in part
by written notification to the OWNER which shall include the reason for such termination,
the effective date and the portion to be terminated.
C. The OWNER shall have the right to terminate this Agreement for convenience, in whole or in
part, by written notification to the CITY, which shall include the reason for such termination,
the effective date and the portion to be terminated.
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D. If, in the case of a partial termination, it is the determination of CITY that the remaining
portion of the award is not sufficient to accomplish the project as described in the Work
Statement, CITY may require that the entire grant be terminated.
E. Default.
The actions noted below shall constitute an event of default by OWNER hereunder. CITY may
give written notice of default to the OWNER, by registered or certified mail, addressed to the
address stated in this Agreement, or such other address as may subsequently, upon
appropriate written notice thereof to CITY, be designated by the OWNER as its legal business
address. :
1.
2.
3.
4.
Failure to comply with the terms and conditions hereof;
Failure to comply with HOME Program regulations, fair housing laws, and other federal
requirements related to the Project;
A default by OWNER under any other of the Loan Documents; and
Any event of fraud, misrepresentation, gross negligence, or willful misconduct by OWNER
in the execution or performance of this Agreement or in its application for participation
in the HOME Program.
F. Remedies.
In the event of default by OWNER hereunder, which is not cured within thirty (30) days of the
mailing of written notice by CITY as described in section 23.E, CITY may seek any combination
of the following remedies:
1. Withhold any further payments to be made under this Agreement until such time as
OWNER's breach has been cured in accordance with the terms and conditions of any cure
period provided by CITY (but CITY may, in its sole discretion, make disbursement after the
occurrence of an Event of Default without thereby waiving its rights and remedies
hereunder);
2. Apply to any appropriate court, State or Federal, for specific performance, in whole or in
part, of the covenants and agreements contained herein, or for an injunction against any
violation of such covenants and agreements;
3.Enter upon the Property and take possession thereof, together with the Project then in
the course of construction, and proceed either in its own name or in the name of the
OWNER, as the attorney-in-fact of the OWNER (which authority is coupled with an
interest and is irrevocable by the OWNER), to complete or cause to be completed the
Project, at the cost and expense of the OWNER;
4. Require the use of or change in professional property management;
5. Require the replacement of the General Partner of OWNER;
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6. Pursue the appointment of a receiver to collect rents and profits or to take possession of
the Project;
7.Declare immediately due and payable all unpaid principal, accrued interest and annual
fees on the Note, together with all other sums payable thereunder and the same shall
thereupon be immediately due and payable without presentment or other demand,
protest, notice of dishonor or any other notice of any kind, all of which are hereby
expressly waived;
8. Apply sanctions set forth in 24 CFR 92, if determined by CITY to be applicable;
9. Apply to any appropriate court, State or Federal, for such other relief as may be
appropriate and allowed by law, since the injury to CITY arising from a default under any
of the terms of this Agreement would be irreparable and the amount of damage would
be difficult to ascertain; and
10. Terminate this Agreement by giving written notice to OWNER of such termination and
specifying the effective date of such termination. If the Agreement is terminated by CITY
as provided herein, OWNER shall have no claim of payment or claim of benefit for any
incomplete project activities undertaken under this Agreement.
Any delay by CITY in exercising any right or remedy provided herein or otherwise afforded by
law or equity shall not be a waiver of or preclude the exercise of such right or remedy. All
such rights and remedies shall be distinct and cumulative and may be exercised singly, serially
(in any order) or concurrently, and as often as the occasion therefore arises.
G. Termination for Convenience
In addition to the termination provision, this Agreement may be terminated by CITY upon
thirty (30) days written notice. In the event of termination under this section, OWNER shall
have no claim of payment or claim of benefit for any incomplete project activities undertaken
under this Agreement and shall not be entitled to, and hereby waives, all claims for lost profits
and all other damages and expenses.
In terminating in accordance with 2 CFR 200, Appendix II, this AGREEMENT may be
terminated in whole or in part only as follows:
1.
2
By CITY with the consent of OWNER in which case the Parties shall agree upon the
termination conditions, including the effective date and in the case of partial termination,
the portion to be terminated; or
By OWNER upon written notification to CITY setting forth the reasons for such
termination, the effective date, and in the case of partial termination, the portion to be
terminated. In the case of a partial termination, CITY may terminate the Contract in its
entirety if CITY determines in its sole discretion that the remaining portion of the Contract
to be performed or HOME Funds to be spent will not accomplish the purposes for which
this AGREEMENT was made
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H. Failure to Submit Required Reports and Documentation During Affordability Period.
If OWNER fails to maintain all records and documentation as required in section 12, or fails
to submit any report or documentation required by this AGREEMENT after the Required
Improvements are completed, or if the submitted report or documentation is not in
compliance with this AGREEMENT or the HOME Regulations as determined by CITY, CITY will
notify OWNER in writing and the OWNER will have 30 calendar days from the date of the
written notice to obtain or recreate the missing records or documentation, or submit or
resubmit any such report or documentation to CITY. If OWNER fails to maintain the required
reports or documentation, or submit or resubmit any such report or documentation within
such time, CITY shall have the right to terminate this AGREEMENT effective immediately upon
written notice of such intent with no penalty or liability to CITY. In the event of termination
under this Section 11.3, any HOME Funds paid to OWNER must be repaid to CITY within 30
days of termination. Failure to repay such HOME Funds will result in CITY exercising all legal
remedies available to CITY under this AGREEMENT and the Loan Documents.
1.In General.
1.Subject to Section 8, and unless specifically provided otherwise in this AGREEMENT,
OWNER shall be in default if OWNER breaches any term or condition of this AGREEMENT.
In the event that such a breach remains uncured after 30 calendar days following written
notice by CITY (or such other notice period as may be specified herein), or if OWNER has
diligently and continuously attempted to cure following receipt of such written notice but
reasonably required more than 30 calendar days to cure, as determined by both Parties
mutually and in good faith, CITY shall have the right to elect, in CITY’s sole discretion, to
(i) extend OWNER’s time to cure, (ii) terminate this AGREEMENT effective immediately
upon written notice of such intent to OWNER, or (iii) pursue any other legal remedies
available to CITY.
2 CITY’s remedies may include:
o Direct OWNER to prepare and follow a schedule of actions for carrying out the affected
activities, consisting of schedules, timetables and milestones necessary to implement
the affected activities, including extending the Affordability Period.
o Direct OWNER to establish and follow a management plan that assigns responsibilities
for carrying out the remedial activities.
o Cancel or revise activities likely to be affected by the performance deficiency, before
expending HOME Funds for the activities.
o Reprogram HOME Funds that have not yet been expended from affected activities to
other eligible activities or withhold HOME Funds.
o Direct OWNER to reimburse CITY in any amount of HOME Funds not used in accordance
with the HOME Regulations.
o Suspend reimbursement of HOME Funds for affected activities.
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o Any other appropriate action including but not limited to any remedial action legally
available such as declaratory judgment, specific performance, damages, temporary or
permanent injunctions, termination of this AGREEMENT or any other contracts with
OWNER, and any other available remedies.
0 In the event of termination under this Section 8.5, all HOME Funds awarded but unpaid
to OWNER pursuant to this AGREEMENT shall be immediately rescinded and OWNER
shall have no further right to such funds and any HOME Funds already paid to OWNER
must be repaid to CITY within 30 days of termination. Failure to repay such HOME
Funds will result in CITY exercising all legal remedies available to CITY under this
AGREEMENT or the Loan Documents.
J. No Funds Disbursed while in Breach.
OWNER understands and agrees that no HOME Funds will be paid to OWNER until all defaults
are cured to CITY’s satisfaction.
K. No Compensation After Date of Termination.
In the event of termination, OWNER shall not receive any HOME Funds in compensation for
work undertaken after the date of termination.
L. Rights of CITY Not Affected.
Termination shall not affect or terminate any of the existing rights of CITY against OWNER, or
which may thereafter accrue because of such default, and this provision shall be in addition
to any and all other rights and remedies available to CITY under the law and Loan Documents
including, but not limited to, compelling OWNER to complete the Required Improvements in
accordance with the terms of the Contract. Such termination does not terminate any
applicable provisions of this AGREEMENT that have been expressly noted as surviving the
term or termination of this AGREEMENT. No delay or omission by CITY in exercising any right
or remedy available to it under this AGREEMENT shall impair any such right or remedy or
constitute a waiver or acquiescence in any OWNER default.
M. Waiver of Breach Not Waiver of Subsequent Breach.
The waiver of a breach of any term, covenant, or condition of this AGREEMENT shall not
operate as a waiver of any subsequent breach of the same or any other term, covenant or
condition hereof.
N. Civil, Criminal and Administrative Penalties.
Failure to perform all the Contract terms may result in civil, criminal or administrative
penalties, including, but not limited to those set out in this AGREEMENT.
O. Termination for Cause.
1. CITY may terminate this AGREEMENT in the event of OWNER’s default, inability, or failure
to perform, subject to notice, grace and cure periods. In the event CITY terminates this
AGREEMENT for cause, all HOME Funds awarded but unpaid to OWNER pursuant to this
AGREEMENT shall be immediately rescinded and OWNER shall have no further right to
42
such funds and any HOME Funds already paid to OWNER must be repaid to CITY within
30 calendar days of termination. Failure to repay such HOME Funds will result in CITY
exercising all legal remedies available to CITY under this AGREEMENT or the Loan
Documents. OWNER ACKNOWLEDGES AND AGREES THAT IF CITY TERMINATES THIS
AGREEMENT FOR CAUSE, NEITHER OWNER NOR ANY AFFILIATES OF OWNER SHALL BE
CONSIDERED FOR ANY OTHER CITY CONTRACT FOR HOME FUNDS FOR A MINIMUM OF 5
YEARS FROM THE DATE OF TERMINATION. This provision shall not apply to the Investor.
2.OWNER may terminate this AGREEMENT if CITY does not provide the HOME Funds
substantially in accordance with this AGREEMENT. In such event, the termination of the
Contract shall have the effect of returning the Parties to their respective circumstances
as existed prior to the execution of this AGREEMENT, and no terms or obligations shal
survive the date of termination, including but not limited to, reporting, inspections or the
Affordability Period.
3.CITY may terminate this AGREEMENT if OWNER defaults on the FWHFC Loan.
P. Dissolution of OWNER Terminates Contract.
In the event OWNER is dissolved or ceases to exist, this AGREEMENT shall terminate. In the
event of termination under this Section, all HOME Funds are subject to repayment and/or
CITY may exercise all of its remedies under this AGREEMENT and the Loan Documents.
Q. Reversion of Assets.
In the event this AGREEMENT is terminated with or without cause, all tangible personal
property owned by OWNER that was acquired or improved with the HOME Funds shall belong
to CITY and shall automatically transfer to CITY or to such assignees as CITY may designate.
R. Notice of Termination under Subordination Agreements.
CITY shall not terminate this AGREEMENT without first giving notice and opportunity to cure
as required in the Subordination Agreements.
S. Notice to Investor of Default.
CITY shall furnish Investor with notice of any default under this AGREEMENT at the address
shown below.
25. INDEMNIFICATION
A.It is expressly understood and agreed by both parties hereto that CITY is contracting with
OWNER as an independent OWNER and that as such, OWNER shall save and hold CITY, its
officers, agents and employees harmless from all liability of any nature or kind, including costs
and expenses for, or on account of, any claims, audit exceptions, demands, suits or damages
of any character whatsoever resulting in whole or in part from the performance or omission
of any employee, agent or representative of OWNER.
B. OWNER agrees to provide the defense for, and to indemnify and hold harmless CITY its
agents, employees, or OWNERs from any and all claims, suits, causes of action, demands,
damages, losses, attorney’s fees, expenses, and liability arising out of the use of these
43
contracted funds and program administration and implementation except to the extent
caused by the willful act or omission of CITY, its agents, employees, or OWNERs.
C.OWNER hereby agrees to reimburse, indemnify and save and hold CITY and its successors and
assigns harmless from and against any damage, liability, loss, penalty, charge, cost or
deficiency, including but not limited to any repayment obligation to HUD incurred by CITY
under 24 CFR 92.503(b), reasonable attorney's fees, and other costs and expenses incident
to monitoring, remedial actions, proceedings or investigations and the defense of any claim,
arising out of, resulting from or related to, and to pay to CITY or its successor in interest, on
demand, the full amount of any sum which CITY or its successor has paid or becomes
obligated to pay on account of:
1. Any misrepresentation, omission, or the breach of any representation or warranty of the
OWNER under the Loan Documents;
2. Any failure of the OWNER to fully perform or observe or cause to be performed or
observed any term, provision, covenant, or agreement to be performed or observed by
the OWNER, or after an assumption, by a subsequent OWNER, pursuant to the Loan
Documents;
3. Any claims, assessments, or liabilities for charges, penalties, liens, taxes, or deficiencies
arising from or relating to the use and operation by the OWNER, or after an assumption,
OWNER’s successors to the Property or Project; or
4.The manufacture, generation, storage, use, treatment, transportation, or disposal of solid
waste, or any toxic or hazardous materials, substances, or pollutants either directly or
indirectly by the OWNER or any of their past or present affiliates on the Property
described on Attachment A, which occurs prior to possession passing from the OWNER
pursuant to a Sheriffs Deed upon completion of a foreclosure or upon acceptance of a
Deed in Lieu of Foreclosure.
The provisions of this section shall survive the termination of this HOME Agreement, the
other Loan Documents, the payment of CITY Forgivable Payment Loan, and the liabilities and
the exercise of any right or remedy under the Loan Documents.
26. IMMIGRATION NATIONALITY Acr.
CITY actively supports the Immigration & Nationality Act (INA) which includes provisions
addressing employment eligibility, employment verification, and nondiscrimination. OWNER
shall verify the identity and employment eligibility of all employees who perform work under this
AGREEMENT. OWNER shall complete the Employment Eligibility Verification Form (1-9), maintain
photocopies of all supporting employment eligibility and identity documentation for all
employees, and upon request, provide CITY with copies of all 1-9 forms and supporting eligibility
documentation for each employee who performs work under this AGREEMENT. OWNER shall
establish appropriate procedures and controls so that no services will be performed by any
employee who is not legally eligible to perform such services. OWNER shall provide CITY with a
certification letter that it has complied with the verification requirements required by this
44
AGREEMENT. OWNER shall indemnify CITY from any penalties or liabilities due to violations of
this provision. CITY shall have the right to immediately terminate this AGREEMENT for violations
of this provision by OWNER.
27. NOTICE
For purposes of this Agreement, all official communications and notices among the parties shall
be deemed made as of the date mailed if sent postage paid to the parties and address set for
below:
TO CITY:TO OWNER:
Housing Programs Manager
City of Denton
601 E. Hickory Street
Denton, Texas 76205
President, Board of Directors
Denton Affordable Housing Corp
1104 Dallas Drive #229
Denton, Texas 76205
28. VENUE
This Agreement shall be interpreted in accordance with the laws of the State of Texas and
venue of any litigation concerning this Agreement shall be in a court of competent jurisdiction
sitting in Denton County, Texas.
IN WITNESS OF WHICH this Agreement has been executed on this the b++\day of
(n)(T, \ obe,r 2020.
CITY OF DENTON DENTOVAFFORDABLE FJ6
BY
RG CORPa
TODD HILEM–AN, CITY MANAGER BARBARA RODMAN, PRESIDENT
ArrEST:ArrEST:
BY /)an
ROSA RIOS, CITY SECRETARY
BY
A
BOARD SECRETARY
DENTON AFFORDABLE HOUSING CORP.
i\lllllltll THIS AGREEMENT HAS BEEN BOTH
REVIEWED AND APPROVED as to financial
and operational obligations and business
terms.
45
bh
lignatu re
APPROVED AS TO LEGAL FORM
AARON LEAL CITY ATrORN
Community Services Manager
Title
Community Development
Department
D,t, Sig,,d, DsI: BA
46
ATrACHMENT A
WORK STATEMENT
Description of improvements: HOME funds will be used to pay costs associated with
improvements to rehab Two (2) duplexes – four (4) accessible rental units at 440/442 and
444/446 Strata. The following improvements will be completed, based on cost and funding
availability:
1. Replacements and Upgrades to Mechanical, Plumbing, and Electrical Systems.
2. Replacement of Millwork, Cabinets, and Doors.
3. Replacement of flooring throughout.
4. Additional Attic Insulation.
5. Kitchen Rehab
6. Bathroom rehab
7. Replace light fixtures including ceiling fans
8. Accessiblity
9. Accessible items (ex. Appliances, fixtures, etc.)
10. Roof Replacement
47
ATrACHMENT B
HOME FUNDS BUDGET
Construction costs:Seventy-two thousand, two hundred and fifty dollars ($72,250.OO)
Please note: if other funding sources and improvements are included in this project, prior to
the start of construction, OWNER shall provide the Community Development Division with a
total project budget, documentation of all funding sources and commitments, and a project
planning/construction schedule.
48
ATrACHMENT C
HOME Investment Partnerships Program
LEASE ADDENDUM
This lease addendum adds the following paragraphs to the lease between a tenant and an
owner of rental housing assisted with HOME Investment Partnerships Program (HOME) funds,
as specified under HOME Federal HUD Regulations 24 CFR 92.
Conflict with Other Provisions of the Lease. In case of any conflict between the provisions of
this Addendum and other sections of the Lease, the provisions of this Addendum shall prevail.
A. Lead Paint Disclosure. For property built prior to January 1, 1978, owner shall provide
tenant with an EPA approved lead hazard information booklet and execute the Lead Based
Paint Acknowledgement Disclosure form.
B. Lease. The lease between a tenant and an owner of rental housing assisted with HOME
funds must be for not less than one year, unless by mutual agreement between the tenant
and the owner.
C Prohibited Lease Terms. The lease may NOT contain any of the following provisions:
(1)Agreement to be sued. Agreement by the tenant to be sued, to admit guilt, or to a
judgment in favor of the owner in a lawsuit brought in connection with the lease;
(2)Treatment of property. Agreement by the tenant that the owner may take, hold, or sell
personal property of household members without notice to the tenant and a court
decision on the rights of the parties. This prohibition, however, does not apply to an
agreement by the tenant concerning disposition of personal property remaining in the
housing unit after the tenant has moved out of the unit. The owner may dispose of this
personal property in accordance with State law;
(3) Excusing owner from responsibility. Agreement by the tenant not to hold the owner or
the owners agents legally responsible for any action or failure to act, whether
intentional or negligent;
(4) Waiver of notice. Agreement of the tenant that the owner may institute a lawsuit
without notice to the tenant;
(5) Waiver of legal proceedings. Agreement by the tenant that the owner may evict the
tenant or household members without instituting a civil court proceeding in which the
tenant has the opportunity to present a defense, or before a court decision on the
rights of the parties;
(6) Waiver of a jury trial. Agreement by the tenant to waive any right to a trial by jury;
(7) Waiver of right to appeal court decision. Agreement by the tenant to waive the tenant’s
right to appeal, or to otherwise challenge in court, a court decision in connection with
the lease; and
(8) Tenant chargeable with cost of legal action regardless of outcome. Agreement by the
tenant to pay attorney's fees or other legal costs even if the tenant wins in a court
49
proceeding by the owner against the tenant. The tenant, however, may be obligated to
pay costs if the tenant loses.
D.Termination of Tenancy. An owner may not terminate the tenancy or refuse to renew the
lease of a tenant of rental housing assisted with HOME funds except for serious or repeated
violation of the terms and conditions of the lease; for violation of applicable Federal, State,
or local law; for completion of the tenancy period for transitional housing; or for other good
cause. To terminate or refuse to renew tenancy, the owner must serve written notice upon
the tenant specifying the grounds for the action at least 30 days before the termination of
tenancy.
E.Annual Income Review. During the duration of lease the tenant agrees to cooperate with
the required recertification of annual household income determination process and sign a
release of information form. Owner may terminate the lease or refuse to renew the lease
for failure to cooperate, if the tenant does not respond within thirty days of the initial
notification to recertify. Providing false information and/or failure to cooperate is a
violation of the lease and can result in termination of the lease.
F. Tenant Income and Rent Restrictions. Owner and tenant acknowledge that as a participant
in the HOME program the rents charged by the Owners are subject to the HOME Rent
Limits. Should a tenant’s household income exceed the applicable HOME limits their rent
will be increased according to the HOME regulations.
G. Inspection. Owner retains the right, and to permit the City of Denton Community
Development Division and the Department of Housing and Urban Development (HUD), to
inspect HOME-assisted units during the affordability period. Tenants must receive at least
twenty-four (24) hour notice for inspections.
H. Housing Standards. Owner agrees to maintain the building and premises in compliance with
all applicable building and/or occupancy codes of the City of Mesa. Furthermore, building
and premises must comply with HUD Housing Quality Standards or additional standards as
adopted by the City of Denton.
I. Fair Housing and Non-Discrimination. The Fair Housing act prohibits discrimination in
housing upon the basis of Race, Color, National Origin, Disability, Sex, Religion, and Familial
Status
Owner or authorized representative and tenant(s) have reviewed the above information and
agree to the terms of this Lease Addendum and hereby acknowledge the receipt of a signed
and dated copy hereof.
Owner/Agency Date Tenant Date
Tenant Date
50
Tenant
Tenant
Date
Date
51