HomeMy WebLinkAboutStaff Report 3.B 10/16/2017DATE: October 16, 2017
Agenda Item #3.B
TO: Honorable Mayor and Members of the City Council through City Manager
FROM: Sue Castellucci, Housing Administrator
SUBJECT: Resolution Approving an Exclusive Negotiating Agreement with Petaluma
Ecumenical Properties, Inc (PEP Housing) in Connection with the Development
of Affordable Housing on City -Owned Property at 951 Petaluma Boulevard South
(A.P.N. 008 -530 -007), and Authorizing the City Manager to Execute on Behalf of
the City the Exclusive Negotiating Agreement and Other Related Documents.
RECOMMENDATION
It is recommended that the City Council adopt the attached Resolution Approving an Exclusive
Negotiating Agreement with Petaluma Ecumenical Properties, Inc (PEP Housing) in Connection
with the Development of Affordable Housing on City -Owned Property at 951 Petaluma
Boulevard South (A.P.N. 008 -530 -007), and Authorizing the City Manager to Execute on Behalf
of the City the Exclusive Negotiating Agreement and Other Related Documents.
BACKGROUND
The parcel at 951 Petaluma Blvd South was acquired by the City in 2011 with former Petaluma
Community Development Commission (RDA) Low - Moderate Housing Set Aside (LMH) funds.
The intention was to develop affordable housing. Under the dissolution of the redevelopment
agency, the parcel was transferred from the RDA to the City. The use of RDA LMH funds
requires that the project must be for households with incomes of not more than 80% of area
median income.
In April 2017, the City solicited a request for proposals for the development of an affordable
housing project on the property. The City received proposals from, Eden Housing, PEP Housing
and Impact Development Group., The proposals were evaluated by staff and presented to the
City Council in Closed Session on June 5'h. Direction was announced out of Closed Session for
staff to focus on the PEP Housing proposal. Over the last several months, staff has been working
with PEP Housing to develop an Exclusive Negotiating Agreement to be signed by both parties.
DISCUSSION
The Exclusive Negotiating Agreement (ENA) has been executed by PEP Housing and is
Attachment #2 to this staff report. The purpose of this agreement is to establish the procedures
and standards for the negotiation of a potential Disposition and Development Agreement (DDA)
that would address terms and conditions regarding disposition of the Property; development of
the project and the affordability and occupancy restrictions that would apply to the project.
The term of the ENA is 180 days from execution of the agreement by all parties PEP Housing
can, however, at its sole discretion exercise the option to extend the Term by an additional 90
days. The City Manager shall have the authority to agree to any further extensions if in his
judgment, sufficient progress toward execution of a mutually acceptable DDA has been made to
merit such an extension. Within that term, both parties will negotiate the completion of a DDA
that will describe the terms and conditions that will govern the conveyance and development of
the property.
Through the ENA, the City is being provided liability protection for preliminary project activity
on the 951 Petaluma Blvd. South property. In exchange, the City agrees to reimburse PEP
Housing for the cost of studies prepared by third parties during the term of the ENA equal to the
aggregate amount of rent that PEP Housing pays to the City during the term of the agreement.
The tasks to be completed during the term of the ENA are as follows:
1. Submittal of Site and Conceptual Plans.
2. Schedule of Performance to be incorporated into the DDA.
3. Developer shall conduct due diligence activities, including but not limited to planning,
soils report, hazardous materials report, financial feasibility and title inspection.
4. Progress Reports shall be made advising the progress on studies being made and matters
being evaluated with respect to this Agreement.
FINANCIAL IMPACTS
The cost to reimburse PEP Housing for the studies is estimated to be between $12,000 if the
ENA remains in effect for the initial 180 day term or up to $18,000 if the term is extended for an
additional 90 days. The revenues that will fund the expenditures are paid from lease payments
made by PEP Housing on the 951 Petaluma Blvd South property during the term of the
agreement. All costs are attributable to the Housing Successor Fund.
ATTACHMENTS
1. Resolution
2. Exclusive Negotiating Agreement (Exhibit A to the Ordinance)
ATTACHMENT #1
RESOLUTION NO._
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PETALUMA
APPROVING AN EXCLUSIVE NEGOTIATING AGREEMENT WITH PETALUMA
ECUMENICAL PROPERTIES, INC (PEP HOUSING) IN CONNECTION WITH THE
DEVELOPMENT OF AFFORDABLE HOUSING ON CITY -OWNED PROPERTY AT
951 PETALUMA BOULEVARD SOUTH (A.P.N. 008 -530 -007), AND AUTHORIZING
THE CITY MANAGER TO EXECUTE ON THE BEHALF OF THE CITY THE
EXCLUSIVE NEGOTIATED AGREEMENT AND OTHER.
WHEREAS, the parcel at 951 Petaluma Blvd South (the "Property ") was acquired by the
City in 2011 with former Petaluma Community Development Commission (RDA) Low -
Moderate Housing Set Aside (LMH) funds with the intention to develop affordable housing; and
WHEREAS, The City has solicited and evaluated development proposals for the
Property, and based upon such evaluation, has selected PEP Housing ( "Developer ") as the entity
with which to enter into exclusive negotiations for development of the Property; and
WHEREAS, the Agreement does not obligate the City to execute a DDA or convey the
Property, or any portion thereof, to Developer, nor does it grant Developer the right to develop
the Project on the Property; and
WHEREAS, the purpose of this Exclusive Negotiating Agreement is to establish the
procedures and standards for the potential disposition and development agreement ( "DDA ") that
would address terms and conditions regarding the disposition of the Property; the development
of the affordable housing project and affordability and occupancy restrictions.
hereby:
NOW THEREFORE BE IT RESOLVED that the City Council of the City of Petaluma
Finds that the Exclusive Negotiating Agreement is necessary to develop the city -owned
property at 951 Petaluma Blvd. South.
2. Approves the Exclusive Negotiating Agreement between PEP Housing and the City of
Petaluma, a copy of which is attached in Exhibit A.
3. Authorizes the City Manager to execute the agreement in accordance with Exhibit A, and
any other related documents necessary to complete this transaction. .
3
PASSED AND ADOPTED AT A REGULAR MEETING OF THE CITY COUNCIL OF
THE CITY OF PETALUMA ON , 2016 BY THE FOLLOWING
VOTE:
AYES:
NOES:
ABSTAIN:
ABSENT:
ATTEST:
City Clerk
11
ATTACHMENT #2
EXHIBIT A
EXCLUSIVE NEGOTIATING RIGHTS AGREEMENT
This Exclusive Negotiating Rights Agreement (this "Agreement ") is entered into effective
as of September , 2017 (the "Effective Date "), by and between the City of Petaluma, a
municipal corporation as the housing successor -(the "City ") and Petaluma Ecumenical Properties,
a California nonprofit public benefit corporation (the "Developer "). City and Developer are
collectively referred to herein as the. "Parties."
RECITALS
A. The City represents that it owns the real property located at 951 Petaluma
Boulevard South, known as Sonoma County Assessor's Parcel No. 008 -530 -007, and more
particularly described in Exhibit A attached hereto (the "Property "). Transfer of the Property to
the City, in its capacity as the housing successor to the former Petaluma Community Development
Commission, was approved by the _Oversight Board to the Petaluma Community Development
Successor Agency by Resolution 2014 -02. The transfer of the Property to the City as housing
successor and the Oversight Board's approval of such transfer were described in the State
Controller's Petaluma Community Development Asset Transfer Review Report published in
February 2015.
B. The City has solicited and evaluated development proposals for the Property, and
based upon such evaluation, has selected Developer as the entity with which to enter into exclusive
negotiations for development_ of the Property.
C. Developer has proposed developing the Property with an affordable housing
development for seniors and senior veterans that will include rental apartments and
complementary uses (the "Project ").
D. The purpose of this Agreement is to establish the procedures and standards for the
negotiation of a potential disposition and development agreement ( "DDA ") that would address
terms and conditions regarding: (i) the disposition of the Property from the City to Developer, (ii)
Developer's development of the Project on the Property, and (iii) affordability and occupancy
restrictions that would apply to the Project. As more fully set forth below, this Agreement does not
obligate the City to execute a DDA or convey the Property, or any portion thereof, to Developer,
nor does it grant Developer the right to develop the Project on the Property. ,
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants and agreements contained
in this Agreement and for other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Parties agree as follows:
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ARTICLE I
EXCLUSIVE NEGOTIATIONS
1.1 Incorporation of Recitals. The Parties acknowledge the truth of the foregoing Recitals
which are hereby incorporated into this Agreement.
1.2 Good Faith Negotiations. During the Term of this Agreement, the Parties shall act
diligently and in good faith to negotiate a DDA that will describe the terms and conditions that
would govern the conveyance of the Property and the development of the Project. Such terms and
conditions shall include, without limitation: (i) disposition price and terms for conveyance of the
Property, (ii) conditions precedent to the conveyance of the Property, (iii) requirements pertaining
to development of the Project, including without limitation, site remediation if applicable,
entitlements, design, density, phasing and development schedule, (iv) requirements regarding
affordability and occupancy restrictions, and (v) Project financing.
1.3 Term. The term of this Agreement ( "Teem ") shall be 180 days, commencing on the
Effective Date. Developer in its sole discretion, has the option to extend the Term once by an
additional 90 days by written notice to the City ( "Option Notice "). The Option Noitce shall be
delivered to the City no later than end of day the last day of the Term. Delivery may be by email,
personal or overnight delivery, or U.S. Mail. Further, the City's City Manager shall have the
authority to agree to any further extension on behalf of the City if in City Manager's judgment,
sufficient progress toward execution of a mutually acceptable DDA has been made to merit such
extension. In addition, upon mutual written agreement of the Parties, the Term shall be extended
as reasonably necessary for preparation and review of any supplemental environmental
documentation that City determines is required prior to City Council consideration of a proposed
DDA.
If a DDA has not been executed by the Parties by the expiration of the Term as such may be
extended pursuant to this Section, this Agreement shall terminate, and neither Party shall have any
further rights or obligations under this Agreement except as may be expressly stated herein. If a
DDA is executed by the Parties, then upon such execution, this Agreement shall terminate, and
except as to such provisions of this Agreement that expressly survive termination, all rights and
obligations of the Parties shall be as set forth in the executed DDA and related documents.
1.4 Exclusive Negotiations. During the Term, the City shall not negotiate with any entity other
than the Developer regarding disposition and development of the Property, nor will City solicit or
entertain bids or proposals to do so.
1.5 Identification of Developer and City Representatives. The Developer's representative to
negotiate the DDA and related documents is Mary Stompe, Executive Director. The City
representative to negotiate the DDA and related documents is John Brown, City Manager. Either
Party may designate a substitute representative by giving written notice to the other Patty.
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ARTICLE II
NEGOTIATION PERIOD TASKS
2.1 Tasks. The Parties shall use reasonable good faith efforts to accomplish their respective
responsibilities set forth in this Section within the Term and in accordance with the schedule set
forth in Exhibit B. The Parties acknowledge that the schedule set forth in Exhibit B has been,
established to support negotiation and execution of a mutually acceptable DDA prior to the
expiration of the Term.
(a) Financing and Costs of Project. Developer has provided the City with a
preliminary financial analysis for the development and
(b) operation of the proposed Project as part of the RFP submission. The
financial analysis and proposed financing sources shall be refined after any
DDA is executed or as otherwise provided in the DDA.
(b) Site and Conceptual Plans. Developer shall submit to the City conceptual plans for
the development of the Property ("Conceptual Plans "). The City shall review and comment on
the Conceptual Plans in a timely manner.
(c) Schedule of Performance. The Developer and the City agree to negotiate a
schedule of performance to be incorporated into the DDA, which shall specify Project
development milestones, including without limitation the date by which an application for
planning approvals will be submitted, the date by which financing commitments will be obtained
for the Project, and the dates for the commencement and completion of Project construction
(including any proposed phasing thereof).
(d) Due Diligence. During the Term, the Developer shall conduct due diligence
activities, including but not limited to planning, soils report, hazardous materials report, financial
feasibility analysis, and title inspection.
(e) Physical Adequacy Determination. The Developer shall conduct physical due
diligence activities to determine whether the Property is suitable for the Project, taking into
account the geotechnical and soils conditions, the presence or absence of toxic or other hazardous
materials, the massing of the proposed Project improvements and applicable parking requirements,
and other environmental and regulatory factors that the Developer deems relevant. If, in the
Developer's judgment based on such investigations and analyses, the Property is not suitable for
development of the Project, the Developer may deliver written notice to the City prior to the
expiration of the Term of its determination ("Termination Notice "). Upon delivery of such
Termination Notice, this Agreement shall be terminated without further action of either Party, and
thereafter neither Party shall have any further duties, obligations, rights, or liabilities under this
Agreement except as expressly provided herein.
(f) Title Inspection. Within thirty (30) days following the Effective Date, Developer
shall obtain a Preliminary Title Report (the "Preliminary Title Report ") for the Property. If the
Developer objects to any exception appearing on the Preliminary Title Report or arising after the
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IN
date of the Preliminary Title Report, Developer may object to such exception in writing, and the
Parties shall determine whether such exception may be removed and /or whether the title company
will issue an endorsement to address such exception. If Developer objects to exceptions affecting
title to the Property and the Parties are unable to agree upon an acceptable method of addressing
such exceptions, Developer may deliver a Termination Notice to City, and upon delivery of such
notice, this Agreement shall be terminated without further action of either Party, and thereafter
neither Party shall have any further duties, obligations, rights, or liabilities under this Agreement
except as expressly provided herein.
2.2 Reports and Studies.
(a) During the Term, Developer may prepare, at Developer's sole expense (subject to
Paragraph (c) of this Section 2.2), any studies, surveys, plans, specifications, test results, analyses,
cost estimates, reports, and other documents prepared or commissioned by Developer with respect
to the Project or the Property ( "Developer's Studies ") Developer deems necessary or desirable in
Developer's discretion, to determine the suitability of the Property for the proposed Project. Such
Developer's Studies may include, without limitation, title investigation, relocation analyses,
marketing, feasibility, soils, seismic and environmental studies, financial feasibility analyses, and
design studies. Developer shall provide to City without representation or warranty, copies of all
non - privileged Developer's Studies upon Termination. Developer agrees to include in all contracts
for the preparation of any non - privileged Developer's Studies a provision that will permit City to
have the right to use and rely upon each such study and report. Developer's obligation to provide
reports and studies pursuant to this Section 2.2(a) shall survive the expiration or earlier termination
of this Agreement.
(b) The City shall provide the Developer with copies of all reports, studies, analyses,
correspondence and similar documents prepared for or by, or commissioned by the City with
respect to the Property but excluding confidential, privileged, or proprietary information, promptly
following execution of this Agreement with respect to documents in its possession or under its
reasonable control, and promptly upon their completion with respect to any subsequently prepared
documents. The City makes no representation or warranty as to the accuracy or completeness of
any such materials.
(c) Upon receipt of invoices accompanied by such additional documentation as City
may reasonably require, City agrees to reimburse Developer for the cost of Developer's Studies
prepared by third parties during the Term in the maximum aggregate amount equal to the rent
payable by Developer to City during the Term pursuant to that certain Lease of the Property
executed by and between City as landlord and Developer as tenant (the "Lease "). The Parties
acknowledge that the rent payable pursuant to the Lease is equal to Two Thousand Dollars
($2,000) per month and that the maximum aggregate amount that City will provide pursuant to this
Paragraph (c) is equal to Twelve Thousand Dollars ($12,000) if this Agreement remains in effect
for the initial 180 day Term, or Eighteen Thousand Dollars ($18,000) if the Term is extended for
an additional 90 days pursuant to Section 1.3 above.
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Upon request by Developer, City will provide the funds described in this Paragraph (c) as a
no- interest predevelopment loan that will be forgiven if Developer does not proceed with
development of the Property.
2.3 Environmental Review. During the Term, the City and the Developer shall review
existing environmental documentation to ascertain whether it adequately addresses the proposed
Project. Based upon that analysis, the City shall prepare or cause to be prepared the appropriate
environmental documentation required by the California Environmental Quality Act ( "CEQA ")
for consideration of approval of the DDA and any planning approvals required for the Project;
provided, that nothing in this Agreement shall be construed to compel the City to approve or make
any particular findings with respect to such CEQA documentation. The Developer shall provide
such information about the Project as may reasonably be required to enable the City to prepare or
cause preparation and consideration of any CEQA - required document, and shall otherwise
reasonably cooperate with the City to complete this task. If the DDA and /or the Project requires
NEPA compliance, the Parties will cooperate to ensure compliance with NEPA. To the extent
CEQA or NEPA does not require documents or process to be completed during the Term and /or
prior to execution of the DDA, such documents or process may be completed subsequent to
execution of the DDA, subject to the DDA terms and applicable law.
2.4 Progress Reports. From time to time as reasonably agreed upon by the Parties, each Party
shall make oral or written progress reports advising the other Party on studies being made and
matters being evaluated with respect to this Agreement and the proposed Project.
ARTICLE III
LIMITATIONS ON EFFECT OF AGREMENT; COMPLIANCE WITH CEQA
3.1 Limitation on Effect of Agreement. This Agreement does not impose a binding obligation
on City to convey any portion of, or interest in, the Property to Developer, nor does it obligate City
to provide any financing or to grant any approvals or authorizations required for the proposed
Project. This Agreement does not obligate either the City or the Developer to enter into a DDA or
to enter into any other agreement. Any DDA resulting from negotiations pursuant to this
Agreement shall become effective only if and after such DDA has been considered and approved
by the City Council of the City of Petaluma ( "City Council ") and executed by duly authorized
representatives of the City and the Developer. No agreement drafts, actions, deliverables or
communications arising from the performance of this Agreement shall impose any legally binding
obligation on either Party to enter into a DDA, nor shall any such documents, actions or
communications constitute any oral-or implied agreement by either Party to enter into any other
agreement. The Parties acknowledge that the final form of any agreement governing the
development of the Property may contain matters not covered in this Agreement, and the
provisions herein are not intended to exclude or preclude any other issues that may arise during
negotiations.
3.2 Compliance with CEQA. Without limiting the generality of Section 3.1, Developer
expressly acknowledges that any proposed DDA resulting from the negotiations contemplated
hereby shall become effective only if such DDA is approved by the City Council following
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FA
compliance with all applicable notice and hearing requirements and compliance with all other
requirements of law, including without limitation, CEQA, and if applicable, NEPA. The Parties
acknowledge that the Project description set forth in this Agreement is preliminary in nature and
shall be described in further detail in the DDA to be negotiated during the Term. The Parties
acknowledge that development of the Property for the Project will require the grant of
discretionary land use entitlements subject to the City's normal review and approval process, that
the Project must comply with CEQA; and if applicable, NEPA, and that nothing in this Agreement
is intended to or shall be interpreted as the grant of any approvals for development of the Project or
the Property, or the modification or waiver of any City procedures or requirements. Without
limiting the foregoing, the Parties acknowledge that the City retains discretion to (i) modify the
Project as City may, in its discretion, determine to be necessary to comply with CEQA, and if
applicable, NEPA, (ii) select other feasible alternatives and /or impose mitigation measures to
avoid ,or minimize significant environmental impacts; (iii) balance the benefits of the Project
against any significant environmental impacts prior to taking final action, if such impacts cannot
otherwise be avoided; and /or (iv) determine not to proceed with the Project.
ARTICLE IV
RIGHT OF ENTRY; INDEMNITY
4.1 Right of Access. During the Term, Developer and its consultants shall have the right of
reasonable access to the Property during normal business hours for the purposes of inspection,
environmental assessments, soils testing, and similar work. Developer shall provide City with
reasonable advance notice prior to entry on the Property, and shall provide not less than 24- hours'
notice of any intent to conduct borings or other invasive testing. City's advance written approval
shall be required for the conduct of borings or other invasive testing. Developer agrees that unless
City agrees otherwise in writing, Developer shall repair, restore, and return the Property and all
improvements located thereon to their condition immediately prior to any such testing at
Developer's sole cost and expense. Prior to entry onto the Property, Developer shall provide
evidence satisfactory to City that Developer and its consultants carry liability insurance consistent
with City requirements, naming the City as an additional insured. Developer shall at all times keep
the Property free and clear of all liens and encumbrances related to Developer's inspection
activities on the Property.
4.2 Indemnity. Developer shall indemnify, defend, and hold the City and its elected and
appointed officers, officials, employees, consultants, agents and representatives (collectively, the
"Indemnitees ") harmless from and against all liability, loss, cost, claim, demand, action, suit,
legal or administrative proceeding, penalty, deficiency, fine, damage and expense (including
without limitation reasonable attorneys' fees and costs) (all of the foregoing, collectively
"Claims ") arising out of the entry onto the Property in connection with the Development ^by
Developer and Developer's agents, employees, consultants, representatives and contractors
( "Developer Parties ") except to the extent any such Claim results from the Indemnitees' gross or
active negligence or willful misconduct. Developer shall not be obligated to indemnify the
Indemnitees against Claims arising in connection with pre - existing environmental or other
conditions or the presence or release of Hazardous Materials in, on, under or from the Property, to
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the extent the same were not caused by Developer or Developer's Parties and are not exacerbated
by the activities of such parties on the Property.
Developer's defense and indemnity obligations pursuant to this Section 4.2 shall survive
the expiration or earlier termination of this Agreement. Nothing in this Section 4.2 is intended to,
or shall be interpreted to, amend or modify any obligation of Developer to indemnify City or the
other Indemnitees pursuant to and in accordance with the Lease.
4.2.1 Definitions. As used in this Agreement, "Hazardous Materials" means any
chemical, compound, material, mixture, or substance that is now or may in the future be defined or
listed in, or otherwise classified pursuant to any Environmental Laws (defined below) as a
"hazardous substance ", "hazardous material ", "hazardous waste ", "extremely hazardous waste ",
infectious waste ", toxic substance ", toxic pollutant ", or any other formulation intended to define,
list or classify substances by reason of deleterious properties such as ignitability, corrosivity,
reactivity, carcinogenicity, or toxicity. The term "hazardous material" shall also include asbestos
or asbestos - containing materials, radon, chrome and /or chromium, polychlorinated biphenyls,
petroleum, petroleum products or by- products, petroleum components, oil, mineral spirits, natural
gas, natural gas liquids, liquefied natural gas, or synthetic gas usable as fuel, perchlorate, and
methyl tert butyl ether, whether or not defined as a hazardous waste or hazardous substance in the
Environmental Laws.
As used in this Agreement, "Environmental Laws" means any and all federal, state and
local statutes, ordinances, orders, rules, regulations, guidance documents, judgments,
governmental authorizations or directives, or any other requirements of governmental authorities,
as may presently exist, or as may be amended or supplemented, or hereafter enacted, relating to the
presence, release, generation, use, handling, treatment, storage, transportation or disposal of
Hazardous Materials, or the protection of the environment or human, plant or animal health,
including, without limitation, the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of
1986 (42 U.S.C. § 9601), the Hazardous Materials Transportation Act (49 U.S.C. § 1801 et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. § 6901 et seq.), the Federal Water
Pollution Control Act (33 U.S.C. § 1251 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the
Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Oil Pollution Act (33 U.S.C. § 2701
et seq.), the Emergency Planning and Community Right -to -Know Act (42 U.S.C. § 11001 et seq.),
the Porter - Cologne Water Quality Control Act (Cal. Water Code § 13000 et seq.), the Toxic Mold
Protection Act (Cal. Health & Safety Code § 26100, et seq.), the Safe Drinking Water and Toxic
Enforcement Act of 1986 (Cal. Health & Safety Code § 25249.5 et seq.), the Hazardous Waste
Control Act (Cal. Health &Safety Code § 25100 et seq.), the Hazardous Materials Release
Response Plans & Inventory Act (Cal. Health & Safety Code § 25500 et seq.), and the
Carpenter - Presley- Tanner Hazardous Substances Account Act (Cal. Health and Safety Code,
Section 25300 et seq.).
ARTICLE V
DEFAULT AND REMEDIES
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5.1 Default. Upon either Party's breach of this Agreement, the nondefaulting Party shall give
written notice of a default to the defaulting Party, specifying the nature of the default and the
required action to cure the default. If a default remains uncured thirty (3 0) days after receipt by the
defaulting Party of such notice, the non - defaulting Party may, as its sole remedy, terminate this
Agreement, and upon such termination the rights and obligations of the Parties hereunder shall
terminate except as expressly provided otherwise in this Agreement. Without limiting the
generality of the foregoing, neither Party shall be entitled to recover damages for a default
hereunder. Developer's failure to accomplish the tasks set forth in Exhibit B within the time
periods specified therein shall entitle City to terminate this Agreement, unless the Parties agree to
modify the deadlines set forth in Exhibit B.
5.2. Notwithstanding any other provision in this Agreement, termination of this Agreement for
any reason, whether through default or otherwise, shall not waive any rights the Parties may have
outside of this Agreement.
ARTICLE VI
GENERAL PROVISIONS
6.1 Notices. Formal notices, demands and communications (other than day to day routine
communications) between the City and the Developer shall be sufficiently given if, and shall not
be deemed given unless: (i) dispatched by certified mail, postage prepaid, return receipt requested,
(ii) sent by express delivery or overnight courier service with a delivery receipt, or (iii) personally
delivered with a delivery receipt, to the office of the Parties shown as follows, or such other
address as the Parties may designate in writing from time to time:
City: City of Petaluma
11 English Street
Petaluma, CA 94952
Attention: City Manager
Developer: Petaluma Ecumenical Properties
951 Petaluma Boulevard South
Petaluma, CA 94952
Attention: Executive Director
Such written notices, demands and communications shall be effective on the date shown on the
delivery receipt as the date delivered or the date on which delivery was refused.
6.2 Costs and Expenses. Except as explicitly set forth in this Agreement, each Party shall be
responsible for its own costs and expenses in connection with any activities and negotiations
undertaken in connection with this Agreement, and the performance of each Party's obligations
under this Agreement.
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6.3 No Commissions. Each Party represents and warrants to the other that is has not retained
the services of any broker, agent or finder with respect to the Property, has not entered into any
agreement, and has no obligation to pay, any real estate commission in connection with the
transactions contemplated by this Agreement. Each Party agrees to hold the other Party harmless
from and against any claim for commission, fee, or other remuneration by any broker, agent, or
finder under any claimed retainer for services with respect thereto. The City shall not be liable for
any real estate commissions or brokerage fees that may arise from this Agreement or any DDA that
may result from this Agreement, unless the City retains a broker, agent or finder. The provisions
of this Section shall survive termination of this Agreement.
6.4 Governing Law; Venue. This Agreement shall be governed by and construed in
accordance with the laws of the State of California without reference to conflicts of laws
principles. Venue for any action under this Agreement shall be in Sonoma County, California.
6.5 Entire Agreement; Amendments. This Agreement constitutes the entire agreement of the
Parties regarding the terms of this Agreement and supersedes all prior or contemporaneous
agreements and understandings, oral or written, between the Parties with respect to such terns.
This Agreement may be amended only by a written instrument executed by the Parties or their
permitted successors in interest.
6.6 Assignment. The qualifications and identity of Developer are of particular concern to City.
It is because of those unique qualifications and identity that City has entered into this Agreement
with Developer. Accordingly, except as provided below, Developer may not transfer or assign its
rights under this Agreement by operation of law or otherwise to any other person or entity, without
the prior written approval of City which approval shall be granted or withheld in the City's sole
discretion. Any purported voluntary or involuntary assignment of Developer's rights under this
Agreement without such City written approval shall be null and void. Notwithstanding the
foregoing, City shall not unreasonably withhold its consent to Developer's assignment of its rights
and obligations under this Agreement to an entity wholly controlled by Developer, pursuant to an
assignment agreement approved by the City.
6.7 Non - Recourse to Agents. No member, official, employee, agent, or consultant of either
Party shall be personally liable to the other Party, or any successor in interest or person claiming
by, through or under such other Party, in the event of any default or breach, or for or on account of
any amount which may be or become due, or in any claim, cause or obligation whatsoever under
the terms of this Agreement.
6.8 No Third Party Beneficiaries. This Agreement is made and entered into solely for the
benefit of the City and the Developer, and no other person or entity shall have any right of action
under or by reason of this Agreement.
6.9 Actions by the City. Whenever this Agreement calls for or permits the approval, consent,
authorization or waiver of the City, the approval, consent, authorization, or waiver of the City
Manager of the City shall constitute the approval, consent, authorization or waiver of the City
without further action of the City Council.
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6.10 Relationship of the Parties. The subject of this Agreement is a private development with
neither Party acting as the agent of the other Party in any respect. None of the provisions in this
Agreement shall be deemed to render the City a partner in the Developer's business, or joint
venturer or member in any joint enterprise with the Developer. The Parties agree that nothing in
this Agreement shall be deemed or interpreted to create between them the relationship of lessor
and lessee, of buyer and seller, or of partners or joint venturers.
6.11 Authority; Disclosure. Developer warrants that none of its principals, officers, partners,
joint venturers, employees, associates, or affiliates who have any economic interest in this
Agreement or the contemplated development of the Property or the Project, have a familial,
financial, or other material relationship with any elected or appointed official or employee of the
City. Each person executing this Agreement on behalf of Developer does hereby covenant and
warrant that (a) Developer is created and validly existing under the laws of California,
(b) Developer has and is duly qualified to do business in California, (c) Developer has full
corporate power and authority to enter into this Agreement and to perform all of Developer's
obligations hereunder, and (d) each person (and all of the persons if more than one signs) signing
this Agreement on behalf of Developer is duly and validly authorized to do so. The City warrants
and represents that it is the owner of the Property, and that it has full authority to take the actions
herein with respect to the Property.
6.12 Severability. If any term or provision of this Agreement or the application thereof shall, to
any extent, be held by a court of competent jurisdiction to be invalid or unenforceable, such term
or provision shall be ineffective to the extent of such invalidity or unenforceability without
invalidating or rendering unenforceable the remaining terms and provisions of this Agreement or
the application of such terms and provisions to circumstances other than those as to which it is held
invalid or unenforceable unless an essential purpose of this Agreement would be defeated by loss
of the invalid or unenforceable provision.
6.13 Captions; Interpretation. This Agreement shall be interpreted as though prepared jointly
by the Parties. Titles and captions are for convenience of reference only and do not define,
describe or limit the scope or the intent of this Agreement or any of its terms.
6.14 Countez arts. This Agreement may be executed in counterparts, each of which shall be
deemed an original but all of which together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first
written above.
DEVELOPER:
PETALUMA ECUMENICAL PROPERTIES, a
Califor is onprof p blic benefit corporation
�#
t
By. ,
Name:
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I-X
Title: % '
CITY:
CITY OF PETALUMA, a municipal corporation
0
John C. Brown, City Manager
Approved as to
Eric Danly, City A
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M
Exhibit A
PROPERTY
[Attach legal description,]
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Exhibit B
SCHEDULE OF PERFORMANCE
Effective Date
September 13, 2017
Conceptual Design Plan submittal
November 15, 2017
Preliminary Financial Analysis submittal
Done
Completion of Due Diligence studies
February 28, 2018
Expiration of 180 Day Exclusive Negotiating Period
March 12, 2018
Developer must exercise Option Notice no later than:
March 12, 2018
Expiration of Extended 90 day Term (If Extended)
December 11, 2018
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