HomeMy WebLinkAboutResolution 2022-074 N.C.S. 05/16/2022
Resolution No. 2022-074 N.C.S. Page 1
Resolution No. 2022-074 N.C.S.
of the City of Petaluma, California
RESOLUTION APPROVING A RESIDENTIAL DENSITY BONUS AGREEMENT FOR THE 890 CO-OP LOCATED AT 890 PETALUMA BOULEVARD NORTH FILE # PLSR-2021-0011 WHEREAS, on June 3, 2021, Matthew Ridgway, on behalf of the property owner, the 890 Co-Op LLC,
submitted an application for Site Plan and Architectural Review and a Residential Density Bonus for the 890
Coop Project, including demolition of the existing one-story, 1,148 square foot vacant food-service building to construct a two and three-story, 10,512 square foot mixed-use project with 3,230 square feet of commercial floor area on the ground floor, seven dwellings on floors two and three, and associated amenities and site improvements, on a 16,590 square foot parcel (all areas are approximate) at 890 Petaluma Boulevard North; and
WHEREAS, on April 12, 2022, the Planning Commission held a duly noticed public hearing to consider the request for Site Plan and Architectural Review and a Residential Density Bonus, at which time all interested parties had the opportunity to be heard; and
WHEREAS, on April 12, 2022, the Planning Commission considered the staff report, dated April 12, 2022,
and adopted Resolution 2022-05 to make findings to approve Site Plan and Architectural Review and to make a recommendation to the City Council to approve a Residential Density Bonus Agreement; and WHEREAS, compliance with the California Environmental Quality Act (CEQA) was completed on April 12,
2022, when the Planning Commission determined that the project was compliant with CEQA Guidelines Section
15183; and WHEREAS, approving a residential density bonus agreement does not constitute a “project” within the meaning of Section 15378 of the California Environmental Quality Act Guidelines, because it is an administrative
activity has no potential for resulting in physical change in the environment; and
WHEREAS, on May 16, 2022, the City Council considered the staff report that recommended that the City Council approve a residential density bonus agreement; and
WHEREAS, per IZO Section 27.030.A.2, a project that reserves at least five percent (5%) of the total units
for Very Low Income (VLI) households is entitled to a density bonus and concessions; and WHEREAS, the proposed project includes at least 14% of the total units for VLI households, and consistent with California Government Code Section 65915(f)(2), the project is eligible for a density bonus of 46.25%, and
per California Government Code Section 65915(d)(2)(B) and IZO Section 27.040.D, the project is eligible for
two concessions; and WHEREAS, while this project is eligible for a density increase to allow as many as 11 dwellings, per California Government Code Section 65915(f), the applicant has not requested an increase in density above what
is allowed in the Mixed Use land use designation; and
WHEREAS, the applicant has proposed two concessions: a concession to increase the building height above the 30-foot height limit in the MU1A zoning district and a concession to reduce the on-site parking requirement and stall dimensions; and
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WHEREAS, per California Government Code Section 65915(d)(1), the concessions requested by the applicant shall be granted unless, based upon substantial evidence, the City finds that the concession or incentive does not result in identifiable and actual cost reductions for rents for very low-income households, the concession or incentive would have a specific, adverse impact, as defined in California Government Code Section
65589.5(d)(2), upon public health and safety or the physical environment or on any real property that is listed in the California Register of Historical Resources and for which there is no feasible method to satisfactorily mitigate or avoid the specific, adverse impact without rendering the development unaffordable to low-income and moderate-income households, or the concession or incentive would be contrary to state or federal law; and
WHEREAS, IZO Section 27.090 requires applicants for a Density Bonus, concession and/or incentive to enter into a Residential Density Bonus Agreement with the City, and that this agreement be approved by the City Council; and WHEREAS, IZO Section 27.090 provides the requirements for a Residential Density Bonus Agreement,
which have been incorporated into the draft Residential Density Bonus Agreement for the project. NOW THEREFORE, BE IT RESOLVED by the City Council of the City of Petaluma as follows: 1. The foregoing recitals are true and correct and incorporated herein as findings of the Resolution.
2. Based on its review of the entire record herein, the City Council makes the following findings: a. That approving a residential density bonus agreement does not constitute a “project” within the meaning of Section 15378 of the California Environmental Quality Act Guidelines, because it is an
administrative activity has no potential for resulting in physical change in the environment. b. The proposed project includes at least 14% of the total units for VLI households, and consistent with California Government Code Section 65915(f)(2), the project is eligible for a density bonus of 46.25%, and per California Government Code Section 65915(d)(2)(B) and IZO Section 27.040.D, the project
is eligible for two concessions.
c. While this project is eligible for a density increase to allow as many as 11 dwellings, per California Government Code Section 65915(f), the applicant has not requested an increase in density above what is allowed in the Mixed Use land use designation.
d. The City complied with California Government Code Section 65915(d)(2)(B) by granting the project the following Concessions to: i. Increase building height to exceed the 30-foot building height maximum allowed in the MU1A zoning district; and
ii. Reduce on-site parking standards to: a) reduce the on-site parking requirement to zero; and b)
reduce the width for nine parking spaces to be less than the nine-foot minimum. e. Per California Government Code Section 65915(d)(1), the concessions requested by the applicant shall be granted unless, based upon substantial evidence, the City can find that the concession or incentive
does not result in identifiable and actual cost reductions for rents for very-low income households, the concession or incentive would have a specific, adverse impact, as defined in California Government Code Section 65589.5(d)(2)1, upon public health and safety or the physical environment or on any real property that is listed in the California Register of Historical Resources and for which there is no
1 A specific, adverse impact means a “significant, quantifiable, direct, and unavoidable impact, based on objective, identified written public health or safety standards, policies, or conditions as they existed on the date the application was deemed complete.
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feasible method to satisfactorily mitigate or avoid the specific, adverse impact without rendering the development unaffordable to low-income and moderate-income households, or the concession or incentive would be contrary to state or federal law.
f. For the reasons stated in the May 16, 2022, City Council staff report, the concessions for height and parking will result in identifiable and actual cost reductions. In addition, there is no evidence in the record to show that the concessions would have a specific, adverse impact upon public health and safety or physical environment or any real property that is listed on the California Register of Historical Resources. Finally, granting these concessions will not be contrary to state or federal law.
g. The Project is consistent with all requirements for a Density Bonus with a Concession as outlined in IZO Chapter 27 (Residential Density Bonus) and California state density bonus law. 3. Based on its review of the entire record herein, including the May 16, 2022, City Council staff report, all
supporting, referenced, and incorporated documents, and all comments received, the City Council hereby approves the Residential Density Bonus Agreement attached as Exhibit A hereto and incorporated herein by reference and authorizes the City Manager or her designee to execute the Residential Bonus Agreement.
Under the power and authority conferred upon this Council by the Charter of said City.
REFERENCE: I hereby certify the foregoing Resolution was introduced and adopted by the
Council of the City of Petaluma at a Regular meeting on the 16th day of May 2022,
by the following vote:
Approved as to
form:
__________________________
City Attorney
AYES: Mayor Barrett, Vice Mayor Pocekay, Barnacle, Fischer, Healy, King, McDonnell
NOES: None
ABSENT: None
ABSTAIN: None
ATTEST: ______________________________________________
City Clerk
______________________________________________
Mayor
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RECORDING REQUESTED BY:
CITY OF PETALUMA
When Recorded, Return to: Office of the City Clerk
City of Petaluma 11 English Street
Petaluma, CA 94952
Recording requested Pursuant to Government Code Sections 27383 & 6103 – NO FEE
APN: 006-051-076-000
AFFORDABLE HOUSING & DENSITY BONUS
REGULATORY AGREEMENT
AND
DECLARATION OF RESTRICTIVE COVENANTS
by and between
THE CITY OF PETALUMA
AND
890 Co-Op LLC
EXHIBIT A
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This Affordable Housing & Density Bonus Regulatory Agreement and Declaration of Restrictive Covenants (this “Agreement”) is entered into effective as of Enter Date (“Effective
Date”) by and between the City of Petaluma, a California municipal corporation and charter city
(“City”) and the 890 Co-Op LLC (“Owner”). The City and the Owner are collectively referred to herein as the “Parties.”
RECITALS
A. Owner is the owner of the real property located at 890 Petaluma Boulevard North in
the City of Petaluma, California, known as Sonoma County Assessor’s Parcel No. 006-051-076-
000, and more particularly described in Exhibit A attached hereto (the “Property”).
B. Owner intends to construct, own, and operate a residential development on the Property consisting of seven (7) dwellings (the “Project”).
C. On April 12, 2022, the Planning Commission of the City of Petaluma (“Planning
Commission”) considered Site Plan and Architectural Review and Density Bonus for the project
and recommended approval of the Density Bonus to the City Council as outlined in Planning Commission Resolution No. 2022-05.
D. On May 16, 2022, the City Council of the City of Petaluma (“City Council”) considered the Planning Commission’s recommendation and the Density Bonus as requested by the
Owner and approved the Density Bonus for the Project subject to subsequent Planning Commission
approval of Site Plan and Architectural Review and the execution and recordation of this Agreement.
E. This Agreement implements California Government Code Section 65915 et seq. (the “Density Bonus Statute”) and Petaluma Implementing Zoning Ordinance Chapter 27 (the
“Density Bonus Ordinance”). Pursuant to the Density Bonus Statute and the Density Bonus
Ordinance, Owner has agreed to provide one (1) dwelling in the Project as a below market-rate dwelling that will be available to Very-Low Income (VLI) Households at Affordable Rent (the “BMR Unit”). Pursuant to the Density Bonus Ordinance, Owner is required to enter into and record this Agreement in the Official Records of the County of Sonoma for the benefit of City.
F. The purpose of this Agreement is to satisfy the requirements of the Density Bonus
Ordinance and to regulate and restrict the rental of the BMR Unit. The Parties intend the covenants set forth in this Agreement to run with the land and to be binding on the Project, the Owner and Owner’s successors and assigns for the full term of this Agreement.
NOW THEREFORE, in consideration of the foregoing, and other valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows.
1. Incorporation of Recitals; Definitions.
1.1 Incorporation of Recitals; Acknowledgement. The Parties acknowledge the truth of the foregoing Recitals which are hereby incorporated into this Agreement. Owner acknowledges and agrees that the City has granted concessions for the Project, including a concession to increase
the building height above the 30-foot height limit in the MU1A zoning district and a concession to
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reduce the on-site parking requirement and stall dimensions, and that therefore, the City has the legal authority to impose rent and income eligibility requirements on the BMR Unit pursuant to the
Density Bonus Statute and the Density Bonus Ordinance.
1.2 Definitions. The following terms shall have the meanings set forth in this Section wherever used in this Agreement or the attached exhibits.
“Actual Household Size” means the actual number of persons in the applicable household.
“Affordable Rent” means a monthly housing expenses, including a reasonable allowance
for utilities, for Rental Restricted Affordable Units reserved for Very Low-Income Households,
shall not exceed the following calculations: 50 percent of the area median income for Sonoma County, adjusted for household size, multiplied by 30 percent and divided by 12.
“Area Median Income” or “AMI” means the area median income for Sonoma County, California, adjusted for Actual Household Size, as determined by the United States Department of
Housing and Urban Development (“HUD”) and as published from time to time by the State of
California Department of Housing and Community Development (“HCD”) in Section 6932 of Title 25 of the California Code of Regulations or successor provision published pursuant to California Health and Safety Code Section 50093(c).
“Assumed Household Size” means with respect to the BMR Unit, the ‘loft’ dwelling would
accommodate a household up to a maximum of three persons (two people per bedroom plus one).
“BMR Unit” means any one of the four ‘loft’ dwellings facing Petaluma Boulevard North (as approved April 12, 2022, by the Planning Commission) that is required to be rented to Eligible Households at Affordable Rent in accordance with the Density Bonus Ordinance and this Agreement.
“Claims” is defined in Section 11.
“Density Bonus Ordinance” means the City of Petaluma Implementing Zoning Ordinance Chapter 27.
“Density Bonus Statute” means California Government Code Section 65915 et seq.
“Effective Date” is the date set forth in the preamble to this Agreement.
“Eligible Household” means a household that qualifies as a Very Low-Income Household.
“Gross Income” shall have the meaning set forth in Section 6914 of Title 25 of the California Code of Regulations as such section may be revised from time to time.
“Indemnitees” is defined in Section 11.
“Marketing and Management Plan” is defined in Section 3.7.
“Official Records” means the Official Records of the Sonoma County Recorder.
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“Project” is defined in Recital B.
“Property” is defined in Recital A.
“Very Low-Income Household” means a household whose Gross Income does not exceed
the qualifying limit applicable to Sonoma County for very low-income households as determined by the U.S. Department of Housing & Urban Development pursuant to Section 8 of the United States Housing Act of 1937 and as published from time to time by the State of California Department of Housing and Community Development (“HCD”) in Section 6932 of Title 25 of
the California Code of Regulations or successor provision published pursuant to California
Health and Safety Code Section 50093(c).
2. Affordability Restrictions.
2.1 Affordability Requirements. For a term of fifty-five (55) years commencing upon the date of issuance of a final certificate of occupancy or equivalent for the Project, the Project’s
BMR Unit shall be rented at Affordable Rent and occupied (or if vacant, available for occupancy)
by Eligible Households. In the event that following initial occupancy of the BMR Unit, a tenant’s household Gross Income increases so that the tenant no longer qualifies as an Eligible Household, Owner may raise the tenant’s rent to an amount net of utilities, that is the lesser of the rent for a comparable market-rate dwelling in the Project or one-twelfth (1/12th) of thirty percent (30%) of
the tenant’s household Gross Income; provided however, Owner must rent the next available unit
in the Project that complies with the definition of BMR Unit to an Eligible Household at an Affordable Rent.
2.2 Rent for Restricted Unit. Rent for the BMR Unit shall be limited to Affordable Rent.
2.3 No Condominium Conversion; No Short-Term Rentals. Owner shall not convert the
BMR Unit to condominium or cooperative ownership or sell condominium or cooperative rights to
the BMR Unit during the term of this Agreement. The BMR Unit must be occupied as the tenant’s principal residence. Subleases and assignments are not permitted except to Eligible Households at an Affordable Rent.
2.4 Design; Amenities. The design, appearance, and general quality of the BMR Unit
shall be comparable to that of the market rate dwellings in the Project. The BMR Unit may have
different interior finishes and features than market-rate dwellings in the Project so long as such finishes and features are durable, of good quality, compatible with market-rate dwellings, and consistent with contemporary standards for new housing. The BMR Unit must contain a dishwasher, refrigerator, garbage disposal, and cooking facilities. The BMR Unit need not contain
optional upgrades and luxury items, and Owner may install such optional upgrades and luxury items
in market-rate dwellings in the Project. The City shall have the right to inspect the BMR Unit to determine whether it has been constructed in accordance with this Section. Occupants of the BMR Unit shall have access to all Project amenities and recreational facilities available to occupants of the Project’s market-rate dwellings.
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3. Tenant Selection.
3.1 Marketing BMR Unit; Use of County List of Prospective Tenants. Owner shall offer
the BMR Unit for rent at the same time or sooner than the market-rate dwellings in the Project are
offered for rent. Owner agrees to use any list maintained by the Sonoma County Housing Authority for the Section 8 Housing Choice Voucher program or similar program.
3.2 Income Verification. Prior to entering into a commitment to rent or lease the BMR Unit, Owner shall provide a certification to City in form approved by City pursuant to which Owner
shall certify that Owner has obtained, and reviewed information provided by the prospective tenant
regarding the prospective tenant’s household income and status as an Eligible Household, and that Owner has no knowledge that the prospective tenant does not qualify as an Eligible Household. In connection with such certification, prospective tenants shall be required to provide written certification of household income, including without limitation, such documents as income tax
returns for the previous calendar year, W-2 statements, and pay stubs to Owner, and City shall have
the right to inspect such documentation pursuant to Section 4.4 below. California Tax Credit Allocation Committee income verification forms will be used to verify tenants for the BMR Unit. (Attachment C)
3.3 Compliance with Fair Housing Laws. Owner shall comply with all state and federal
fair housing laws, rules, regulations and guidelines in the marketing and rental of the dwellings in
the Project. Owner shall accept as tenants of the BMR Unit, on the same basis as all other prospective tenants, persons who are recipients of federal certificates or vouchers for rent subsidies pursuant to the existing Section 8 program or any successor thereto. Owner may require prospective tenants to complete an application and credit and background check provided that the prospective
tenants of market-rate dwellings in the Project are subject to the same application and credit and
background check.
3.4 Non-Discrimination. Owner shall not restrict the rental, sale, lease, sublease, transfer, use, occupancy, tenure or enjoyment of the Property, or any portion thereof, on the basis of race, color, religion, creed, sex, sexual orientation, disability, marital status, ancestry, or national
origin of any person. Owner covenants for itself and all persons claiming under or through it, and
this Agreement is made and accepted upon and subject to the condition that there shall be no discrimination against or segregation of any person or group of persons on account of any basis listed in subdivision (a) or (d) of Section 12955 of the Government Code, as those bases are defined in Sections 12926, 12926.1, subdivision (m) and paragraph (1) of subdivision (p) of Section 12955,
and Section 12955.2 of the Government Code, in the sale, lease, sublease, transfer, use, occupancy,
tenure or enjoyment of the Property or part thereof, nor shall Owner or any person claiming under or through Owner establish or permit any such practice or practices of discrimination or segregation with reference to the selection, location, number, use or occupancy of tenants, lessees, subtenants, sublessees or vendees in, of, or for the Property or part thereof. Owner shall include such provision
in all deeds, leases, contracts and other instruments executed by Owner, and shall enforce the same
diligently and in good faith.
3.5 Marketing and Management Plan; Restrictions on Subleasing and Assignment. In marketing the BMR Unit, Owner shall comply with Section 3.1 above. Owner shall provide to City the form of rental agreement that Owner proposes to use in renting the BMR Unit for City’s review
and approval prior to marketing the BMR Unit. The lease or rental agreement for the BMR Unit
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shall include a provision that prohibits subleasing or assignment of the lease or rental agreement other than to an Eligible Household at an Affordable Rent.
3.6 No Short-Term Rentals. Prospective tenants of the BMR Unit must sign a written
statement acknowledging their agreement that the BMR Unit must be occupied as the tenant’s principal residence, that the unit may not be subleased except to an Eligible Household at an Affordable Rent, that the tenant may not make the unit available for short term rental, and that the tenant is required to annually sign a written statement certifying compliance with all of the
foregoing requirements.
4. Reporting Requirements; Access to Information; Inspections.
4.1 Tenant Certification. Owner or Owner’s authorized agent shall obtain from each household prior to initial occupancy of the BMR Unit, and on every anniversary thereafter, a written certificate containing all of the following in such format and with such supporting documentation
as City may reasonably require: (a) the identity of each household member; (b) the tenant’s total
household Gross Income; and (c) a certification that the tenant is occupying the BMR Unit as the tenant’s principal residence. Owner shall retain such certificates for not less than five (5) years, and upon City’s request, shall make the originals available for City inspection.
4.2 Annual Report; Inspections. Following completion of Project construction, by not
later than April 30 of each year during the term of this Agreement, Owner shall submit an annual
report (“Annual Report”) to the City in form satisfactory to City, together with a certification that the Project is in compliance with the requirements of this Agreement. The Annual Report shall, at a minimum, include the following information for the BMR Unit: (a) unit number; (b) current rent and other charges; (c) dates of any vacancies during the previous year; (d) the number of people
residing in the unit; (e) total household Gross Income of the tenant; and (f) documentation of source
of household income. Owner shall include with the Annual Report, an income certification for each household based upon documentation verifying tenant eligibility as described in Section 4.1, and such additional information as City may reasonably request from time to time in order to demonstrate compliance with this Agreement.
4.3. Maintenance of Records.
(1) Owner shall maintain tenant leases, income certifications and other matters related to the leasing of the BMR Unit for a period of five (5) years after the final date of occupancy by the tenant.
(2) Records must be kept accurate and up-to-date. City shall notify Owner of
any records it deems insufficient. Owner shall have fifteen (15) calendar days from such notice to
correct any specified deficiency in the records, or, if more than fifteen (15) days shall be reasonably necessary to correct the deficiency, Owner shall begin to correct the deficiency within fifteen (15) days and diligently pursue the correction of the deficiency as soon as reasonably possible.
4.4 Access to Records; Inspections.
(1) With at least 48 hours’ notice, during normal business hours, Owner shall
provide City and its authorized agents and representatives access to any books, documents, papers,
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and records of the Project relating to the BMR Unit for the purpose of making audits, examinations, excerpts, and transcriptions.
(2) With at least 48 hours’ notice, during normal business hours and as often as
may be deemed necessary, City and its authorized agents and representatives shall be permitted access to, and the right to examine, the Project and the Property, and to interview employees and tenants, of the Project, for the purpose of verifying compliance with applicable regulations and compliance with the conditions of this Agreement.
5. Term of Agreement.
5.1 Term of Restrictions. This Agreement shall remain in effect until the fifty-fifth (55th) anniversary of the issuance of the final certificate of occupancy or equivalent for the Project, unless the term is extended by written agreement of the Parties.
5.2 Effectiveness Succeeds Conveyance of Property. This Agreement shall remain
effective and fully binding for the full term hereof regardless of any sale, assignment, transfer, or
conveyance of the Property or the Project or any part thereof or interest therein.
5.3 Reconveyance. Upon the termination of this Agreement, the Parties agree to execute and record appropriate instruments to release and discharge this Agreement; provided, however, the execution and recordation of such instruments shall not be necessary or a prerequisite to the
termination of this Agreement upon the expiration of the term.
6. Binding Upon Successors; Covenants to Run with the Land. The City and the Owner hereby declare their express intent that the covenants and restrictions set forth in this Agreement shall run with the land and shall be binding upon all successors in title to the Property, regardless of any sale, assignment, conveyance or transfer of the Property, the Project or any part thereof or interest
therein. Any successor-in-interest to Owner, including without limitation any purchaser, transferee
or lessee of the Property or the Project (other than the tenants of the individual dwellings or commercial space within the Project) shall be subject to all of the duties and obligations imposed hereby for the full term of this Agreement. Each and every contract, deed, ground lease or other instrument affecting or conveying the Property or the Project or any part thereof, shall conclusively
be held to have been executed, delivered and accepted subject to the covenants, restrictions, duties
and obligations set forth herein, regardless of whether such covenants, restrictions, duties and obligations are set forth in such contract, deed, ground lease or other instrument; provided, however, that upon the expiration of the term of this Agreement, said covenants and restrictions shall expire. This Agreement shall bind any successor, heir or assign of the Owner, whether a change in interest
occurs voluntarily or involuntarily, by operation of law or otherwise. Owner agrees for itself and
its successors that in the event that a court of competent jurisdiction determines that the covenants herein do not run with the land, such covenants shall be enforced as equitable servitudes against the Property and the Project in favor of City.
Without limiting the generality of the foregoing, Owner and City hereby declares their
understanding and intent that:
(a) The covenants and restrictions contained in this Agreement shall be construed as covenants running with the land pursuant to California Civil Code section 1468 and not as conditions
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which might result in forfeiture of title by Owner;
(b) The burden of the covenants and restrictions set forth in this Agreement touch and concern
the Property in that the Owner’s legal interest in the Property and all improvements thereon
are rendered less valuable thereby;
(c) The benefit of the covenants and restrictions set forth in this Agreement touch and concern the land by enhancing and increasing the enjoyment and use of the Property by the BMR Unit tenants; and
(d) All covenants and restrictions contained herein without regard to technical classification or
designation shall be binding upon Owner and its successors in interest for the benefit of the City, and such covenants and restrictions shall run in favor of the City for the entire period during which such covenants and restrictions shall be in force and effect, without regard to whether the City is an owner of any land or interest therein to which such covenant and
restrictions relate.
7. Property Management; Repair and Maintenance.
7.1 Management Responsibilities. Owner shall be responsible for all management functions with respect to the Property and the Project, including without limitation the selection of tenants, certification and recertification of household income and eligibility, evictions, collection
of rents and deposits, maintenance, landscaping, routine and extraordinary repairs, replacement of
capital items, and security. City shall have no responsibility for management or maintenance of the Property or the Project.
7.2 Repair, Maintenance and Security. Throughout the term of this Agreement, Owner shall at its own expense, maintain the Property and the Project in good physical condition, in good
repair, and in decent, safe, sanitary, habitable and tenantable living conditions in conformity with
all applicable state, federal, and local laws, ordinances, codes, and regulations. Without limiting the foregoing, Owner agrees to maintain the Project and the Property (including without limitation, the dwellings, common areas, meeting rooms, landscaping, driveways, parking areas and walkways) in a condition free of all waste, nuisance, debris, unmaintained landscaping, graffiti, disrepair,
abandoned vehicles/appliances, and illegal activity, and shall take all reasonable steps to prevent
the same from occurring on the Property or at the Project. Owner shall prevent and/or rectify any physical deterioration of the Property and the Project and shall make all repairs, renewals and replacements necessary to keep the Property and the improvements located thereon in good condition and repair. Owner shall provide adequate security measures for the Project, including
without limitation, the installation of adequate lighting and deadbolt locks.
7.3 Fees, Taxes, and Other Levies. Owner shall be responsible for payment of all fees, assessments, taxes, charges, liens, and levies applicable to the Property or the Project, including without limitation possessory interest taxes, if applicable, imposed by any public entity, and shall pay such charges prior to delinquency. However, Owner shall not be required to pay any such
charge so long as (a) Owner is contesting such charge in good faith and by appropriate proceedings,
(b) Owner maintains reserves adequate to pay any contested liabilities, and (c) on final determination of the proceeding or contest, Owner immediately pays or discharges any decision or judgment rendered against it, together with all costs, charges and interest.
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7.4 Insurance Coverage. Throughout the term of this Agreement Owner shall comply with the insurance requirements set forth in Exhibit B, and shall, at Owner’s expense, maintain in
full force and effect insurance coverage as specified in Exhibit B.
7.5 Property Damage or Destruction. If any part of the Project is damaged or destroyed, Owner shall repair or restore the same, consistent with the occupancy and rent restriction requirements set forth in this Agreement. Such work shall be commenced as soon as reasonably practicable after the damage or loss occurs and shall be completed within one year thereafter or as
soon as reasonably practicable, provided that insurance proceeds are available to be applied to such
repairs or restoration within such period and the repair or restoration is financially feasible. If this provision conflicts with the requirements of senior lenders, the requirements of such lenders shall prevail.
8. Recordation; No Subordination. This Agreement shall be recorded in the Official Records
of Sonoma County. Owner hereby represents, warrants and covenants that with the exception of
easements of record, absent the written consent of City, this Agreement shall not be subordinated in priority to any lien (other than those pertaining to taxes or assessments), encumbrance, or other interest in the Property or the Project. If at the time this Agreement is recorded, any interest, lien, or encumbrance has been recorded against the Project in position superior to this Agreement, upon
the request of City, Owner hereby covenants and agrees to promptly undertake all action necessary
to clear such matter from title or to subordinate such interest to this Agreement consistent with the intent of and in accordance with this Section 8, and to provide such evidence thereof as City may reasonably request.
9. Mortgagee Protection. No violation of any provision contained herein shall defeat or render
invalid the lien of any mortgage or deed of trust made in good faith and for value upon all or any
portion of the Project or the Property, and the purchaser at any trustee’s sale or foreclosure sale shall not be liable for any violation of any provision hereof occurring prior to the acquisition of title by such purchaser. Such purchaser shall be bound by and subject to this Agreement from and after such trustee’s sale or foreclosure sale. Promptly upon determining that a violation of this Agreement
has occurred, City shall give written notice to the holders of record of any mortgages or deeds of
trust encumbering the Project or the Property that such violation has occurred.
10. Default and Remedies.
10.1 Events of Default. The occurrence of any one or more of the following events shall constitute an event of default hereunder (“Event of Default”):
(a) Owner’s failure to maintain insurance on the Property and the Project as
required hereunder, and the failure of Owner to cure such default within five (5) days;
(b) Subject to Owner’s right to contest the following charges, Owner’s failure to pay taxes or assessments due on the Property or the Project or failure to pay any other charge that may result in a lien on the Property or the Project, and Owner’s failure to cure such default within
twenty (20) days of delinquency, but in all events prior to the imposition of any such tax or other
lien;
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(c) A default arises under any loan secured by a mortgage, deed of trust or other security instrument recorded against the Property and remains uncured beyond any applicable cure
period such that the holder of such security instrument has the right to accelerate repayment of such
loan;
(d) Owner’s default in the performance of any term, provision or covenant under this Agreement (other than an obligation enumerated in this Section 10.1), and unless such provision specifies a shorter cure period for such default, the continuation of such default for ten
(10) days in the event of a monetary default or thirty (30) days in the event of a non-monetary
default following the date upon which City shall have given written notice of the default to Owner, or if the nature of any such non-monetary default is such that it cannot be cured within thirty (30) days, Owner’s failure to commence to cure the default within thirty (30) days and thereafter prosecute the curing of such default with due diligence and in good faith, but in no event longer
than sixty (60) days from the date of delivery of the notice of default.
10.2 Remedies. Upon the occurrence of an Event of Default and its continuation beyond any applicable cure period, City may proceed with any of the following remedies:
(a) Bring an action for equitable relief seeking the specific performance of the terms and conditions of this Agreement, and/or enjoining, abating, or preventing any violation of
such terms and conditions, and/or seeking declaratory relief;
(b) For violations of obligations with respect to rents for the BMR Unit, impose as liquidated damages a charge in an amount equal to the actual amount collected in excess of the Affordable Rent;
(c) Bring an action for damages or pursue any other remedy allowed at law, or
in equity;
(d) Pursue any remedy available under the Density Bonus Ordinance.
Each of the remedies provided herein is cumulative and not exclusive. The City may exercise from time to time any rights and remedies available to it under applicable law or in equity, in addition to, and not in lieu of, any rights and remedies expressly provided in this Agreement.
11. Indemnity. To the greatest extent permitted by law, Owner shall indemnify, defend (with
counsel approved by City) and hold the City and its elected and appointed officers, officials, employees, agents, consultants, contractors and representatives (collectively, the “Indemnitees”) harmless from and against all liability, loss, cost, expense (including without limitation attorneys’ fees and costs of litigation), claim, demand, action, suit, judicial or administrative proceeding,
penalty, deficiency, fine, order, and damage (all of the foregoing collectively “Claims”) arising
directly or indirectly, in whole or in part, as a result of or in connection with Owner’s construction, management, or operation of the Property and the Project or any failure to perform any obligation as and when required by this Agreement. Owner’s indemnification obligations under this Section 11 shall not extend to Claims to the extent resulting from the gross negligence or willful misconduct
of Indemnitees. The provisions of this Section 11 shall survive the expiration or earlier termination
of this Agreement.
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12. Miscellaneous.
12.1 Amendments. This Agreement may be amended or modified only by a written
instrument signed by both Parties.
12.2 No Waiver. Any waiver by City of any term or provision of this Agreement must be in writing. No waiver shall be implied from any delay or failure by City to take action on any breach or default hereunder or to pursue any remedy allowed under this Agreement or applicable law. No failure or delay by City at any time to require strict performance by Owner of any provision of this
Agreement or to exercise any election contained herein or any right, power or remedy hereunder
shall be construed as a waiver of any other provision or any succeeding breach of the same or any other provision hereof or a relinquishment for the future of such election.
12.3 Notices. Except as otherwise specified herein, all notices to be sent pursuant to this Agreement shall be made in writing, and sent to the Parties at their respective addresses specified
below or to such other address as a Party may designate by written notice delivered to the other
parties in accordance with this Section. All such notices shall be sent by: (a) personal delivery, in which case notice is effective upon delivery; (b) certified or registered mail, return receipt requested, in which case notice shall be deemed delivered upon receipt if delivery is confirmed by a return receipt; or (c) nationally recognized overnight courier, with charges prepaid or charged to
the sender’s account, in which case notice is effective on delivery if delivery is confirmed by the
delivery service.
City: City of Petaluma 11 English Street Petaluma, CA 94952
Attention: City Manager
Owner: 890 Co-Op LLC 17680 Neeley Road Guerneville, CA 95446-9130
12.4 Further Assurances. The Parties shall execute, acknowledge and deliver to the other
such other documents and instruments, and take such other actions, as either shall reasonably request as may be necessary to carry out the intent of this Agreement.
12.5 Parties Not Co-Venturers; Independent Contractor; No Agency Relationship. Nothing in this Agreement is intended to or shall establish the Parties as partners, co-venturers, or
principal and agent with one another. The relationship of Owner and City shall not be construed as
a joint venture, equity venture, partnership or any other relationship. City neither undertakes nor assumes any responsibility or duty to Owner (except as expressly provided in this Agreement) or to any third party with respect to the Project. Owner and its employees are not employees of City but rather are, and shall always be considered independent contractors. Furthermore, Owner and its
employees shall at no time pretend to be or hold themselves out as employees or agents of City.
Except as City may specify in writing, Owner shall not have any authority to act as an agent of City or to bind City to any obligation.
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12.6 Action by the City. Except as may be otherwise specifically provided herein, whenever any approval, notice, direction, consent or request by the City is required or permitted
under this Agreement, such action shall be in writing, and such action may be given, made or taken
by the City Manager of the City of Petaluma or by any person who shall have been designated by the City Manager, without further approval by the City Council.
12.7 Non-Liability of City and City Officials, Employees and Agents. No member, official, employee or agent of the City shall be personally liable to Owner or any successor in
interest, in the event of any default or breach by the City, or for any amount of money which may
become due to Owner or its successor or for any obligation of City under this Agreement.
12.8 Headings; Construction; Statutory References. The headings of the sections and paragraphs of this Agreement are for convenience only and shall not be used to interpret this Agreement. The language of this Agreement shall be construed as a whole according to its fair
meaning and not strictly for or against any Party. All references in this Agreement to particular
statutes, regulations, ordinances or resolutions of the United States, the State of California, or the City of Petaluma shall be deemed to include the same statute, regulation, ordinance or resolution as hereafter amended or renumbered, or if repealed, to such other provisions as may thereafter govern the same subject.
12.9 Time is of the Essence. Time is of the essence in the performance of this Agreement.
12.10 Governing Law; Venue. This Agreement shall be construed in accordance with the laws of the State of California without regard to principles of conflicts of law. Any action to enforce or interpret this Agreement shall be filed and heard in the Superior Court of Sonoma County, California or in the Federal District Court for the Northern District of California.
12.11 Attorneys' Fees and Costs. If any legal or administrative action is brought to interpret
or enforce the terms of this Agreement, the prevailing party shall be entitled to recover all reasonable attorneys' fees and costs incurred in such action.
12.12 Severability. If any provision of this Agreement is held invalid, illegal, or unenforceable by a court of competent jurisdiction, the validity, legality, and enforceability of the
remaining provisions shall not be affected or impaired thereby.
12.13 Entire Agreement; Exhibits. This Agreement, together with the Loan Agreement, the Note and the Deed of Trust contains the entire agreement of Parties with respect to the subject matter hereof, and supersedes all prior oral or written agreements between the Parties with respect thereto. Exhibits A and B attached hereto are incorporated herein by this reference.
12.14 Counterparts. This Agreement may be executed in multiple counterparts, each of
which shall be an original and all of which together shall constitute one agreement.
SIGNATURES ON FOLLOWING PAGES.
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IN WITNESS WHEREOF, the Parties have executed this Affordable Housing & Density Bonus Regulatory Agreement and Declaration of Restrictive Covenants as of the date first written
above.
OWNER:
________________________, a ____________________
By: _______________________________
Print Name: _______________________________
Title: _______________________________
CITY:
City of Petaluma, a California municipal corporation and charter city
By: _______________________________
Peggy Flynn, City Manager
ATTEST:
_____________________________
Kendall Rose, City Clerk
APPROVED AS TO FORM:
_____________________________
Eric W. Danly, City Attorney
SIGNATURES MUST BE NOTARIZED.
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CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.
STATE OF CALIFORNIA
COUNTY OF _____________________
On ______________ before me, _______________________ (here insert name and title of the officer), personally appeared _________________________ who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature _______________________________ (Seal)
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CALIFORNIA ALL-PURPOSE ACKNOWLEDGMENT
A notary public or other officer completing this certificate verifies only the identity of the individual who signed the document to which this certificate is attached, and not the truthfulness, accuracy, or
validity of that document.
STATE OF CALIFORNIA
COUNTY OF _____________________
On ______________ before me, _______________________ (here insert name and title of the officer), personally appeared _________________________ who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within instrument
and acknowledged to me that he/she/they executed the same in his/her/their authorized
capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Signature _______________________________ (Seal)
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Exhibit A
PROPERTY
Real property situated in the City of Petaluma, County of Sonoma, State of California, State of California described as follows:
Insert legal description.
APN: 006-051-076-000
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Exhibit B
INSURANCE REQUIREMENTS
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Exhibit C
Income Verification Form
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