HomeMy WebLinkAbout2013-443 Housing - Habitat for Humanity for Affordable Housing Bond Program $144,304 /J�o 41 Fl
NORTH CAROLINA
AFFORDABLE HOUSING BOND
DEVELOPMENT AGREEMENT
ORANGE COUNTY
This is an AGREEMENT between Orange County, a general local governmental unit of
the State of North Carolina, (hereinafter referred to as the "County") and HABITAT FOR
HUMANITY, ORANGE COUNTY, NORTH CAROLINA, INC., a North Carolina non-profit
org ion ereinafter referred to as "Owner"). The effective date of this Agreement is
WITNESSTH
WHEREAS,the County, in the implementation of the Orange County Affordable Housing
Bond Program solicited applications for funding for affordable housing projects from interested
organizations;and
WHEREAS, Habitat for Humanity, Orange County, North Carolina intends to construct
one (1) duplex affordable rental development targeted for disabled and elderly families earning
less than 80% of the area median income, and which will remain affordable for low and
moderate income families as described in an application for Orange County Affordable Housing
Bond Program funds on file in the County's Housing, Human Rights, and Community
Development Office(hereafter"the Project");and
WHEREAS, on November 20, 2012 the Orange County Board of Commissioners
awarded the Owner $144,304 in FY 2001 Orange County Affordable Housing Bond funds to
assist in the development of the property described more particularly described in EXHIBIT A
attached hereto and made a part of this Agreement(hereinafter referred to as "the Property"); and
NOW, THEREFORE, in consideration of the mutual covenants, promises, and representations
contained herein, it is agreed between the parties hereto as follows:
I. USE OF BOND FUNDS
1. The Owner shall perform the projects or tasks related to its allocation of Bond funds as
provided in Exhibit B and within the proposed budget outlined in Exhibit C. Exhibits B and C
are hereby made a part of this Agreement and are incorporated by reference, as it now reads or as
it may be modified by the parties.
2. The Owner may not request disbursement of funds under this Agreement until the funds
are needed for payment of eligible costs in accordance with Exhibit C. The amount of each
request must be limited to eligible costs as determined by Orange County staff.
3. Said funds shall be disbursed by check payable to the Owner.
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H. AMOUNT OF BOND FUNDS/LOAN TERMS
The County shall make available to the Owner up to One Hundred Forty-Four Thousand Three
Hundred Four Dollars ($144,304) pursuant to this Agreement. Said funds shall be disbursed by
the County to the Owner for performance of the services described in Exhibit B. The Orange
County Affordable Housing Bond Loan funding will be provided in the form of a direct zero
interest loan deferred for a period of 30 years. Loan funds will be secured by a Deed of Trust
and Promissory Note.
III. LIEN POSITION
Orange County hereby acknowledges that the terms and conditions of its (i)Affordable Housing
Bond Development Agreement, (ii) Promissory Note and (iii) Deed of Trust and Security
Agreement(collectively referred to as "Orange County Loan Documents") for the Property shall
be and are expressly subordinated to the following exceptions to title that encumber the property:
(1) Declaration of Restrictive Covenants recorded in Book 2186, Page 213, Orange County
Registry and (2) Declaration of Restrictive Covenants, Conditions and Restrictions for Rusch
Hollow Subdivision recorded in Book 3619,Page 171, Orange County Registry.
IV. TIMELINESS
The Owner shall complete the Project within twelve (12) months from the date of this
Agreement. However, in the event of any alterations or additions or of circumstances beyond the
control of the Owner, which in the opinion of the Director of the County's Department of
Housing, Human Rights and Community Development will require additional time for
completion of the Project, then in that case, the time of completion shall be extended by the
County Manager in writing for a period of time not to exceed six (6) months. Any further
extensions will require the approval of the Orange County Board of County Commissioners.
V. DURATION OF THE AGREEMENT
This Agreement will remain in effect for the Period of Affordability established below.
VI. AFFORDABILITY REQUIREMENTS
Owner agrees to lease the Project dwelling units to families whose income does not
exceed 80% of the area median income by family size, as determined by the U.S. Department of
Housing and Urban Development and as amended from time to time. Residential leases will not
exceed one year in term.
Each of the Project dwelling units must remain affordable for a period of ninety-nine
years. The Owner retains full responsibility for compliance with the affordability requirement
for each of the Project dwelling units, unless affordability restrictions are terminated due to the
sale of the Property to a non-qualified buyer in which event the Resale Provisions of this Section
of this Agreement pertain. The Owner shall assure compliance with affordability of each of the
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Project dwelling units as provided in the Declaration on the Property. This Declaration shall
constitute and remain a lien on the Property during the period of affordability.
It is further the responsibility of the Owner to rerecord the Declaration of Restrictive
Covenants periodically and no less often than one day less than every 30 years from the date
hereof for the purpose of renewing the rights of first refusal in the Property or portion thereof
including any leasehold interest in the Property or portion thereof. Orange County retains the
right to, periodically and every 30 years after the first recording of the Declaration of Restrictive
Covenants on the Property to register, with the Register of Deeds of Orange County, a notice of
preservation of the Restrictive Covenants on the Property as provided in North Carolina General
Statute § 4784 or any comparable preservation law in effect at the time of the recording of the
notice of preservation. It is the intent of this Agreement that the 99 year duration of this
Declaration of Restrictive Covenants be accomplished and that any future owner of the Property,
Owner, and Orange County will do what is necessary to ensure that the same is not extinguished
by N.C. Gen. Stat. § 41-29 or any comparable law purporting to extinguish, by the passage of
time, preemptive rights in the Property and by the Real Property Marketable Title Act or any
comparable law purporting to extinguish, by the passage of time, non possessory interests in real
property. Any future owner, Owner and Orange County agree to do what each must do to
accomplish the 99-year duration of this Declaration of Restrictive Covenants.
Resale Provisions
The Owner shall assure compliance with affordability of each of the Project dwelling units
through the Declaration of Restrictive Covenants. The Declaration of Restrictive Covenants
shall include at least the following elements in their resale provisions for the Improvements:
If Owner no longer uses the Property as rental property or is unable to continue ownership, then
the Owner must sell, transfer, or otherwise dispose of its interest in the Property only to an
agency with similar interest in affordable housing and serve families with incomes not exceeding
80%of the area median household income by family size, as determined by the U.S. Department
of Housing and Urban Development at the time of the transfer. The non-profit fund, foundation,
or corporation of like purposes must have established its tax-exempt status under Section 501 (c)
(3)of the Internal Revenue Code.
However, if the Property is sold, transferred, or otherwise disposed of to other than an agency
with similar interest in affordable housing during the term of affordability, the Right of First
Refusal provision of the County's Long-Term Housing Affordability Policy must be followed
and the net sales proceeds (sales price less: (1) selling cost, (2) the unpaid principal amount of
the original first mortgage and (3) the unpaid principal amount of the initial County contribution
and any other initial government contribution secured by a deferred payment promissory note
and deed of trust)or"equity"will be divided 50150 by the seller of the Property and the County.
The resale provision shall remain in effect for the full affordability period—99 years.
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VII. OWNER PERFORMANCE UNDER THIS AGREEMENT
Owner agrees and authorizes the County to conduct on-site reviews, examine client and
contractor records, client applications and to conduct any other procedures or practices to assure
compliance with these provisions.
Owner agrees to not violate any State or Federal laws, rules or regulations regarding a direct or
indirect illegal interest on the part of any employee or elected official of the Owner in the Project
or payments made pursuant to this Agreement.
Owner agrees that to the best of its knowledge, neither the Project nor the funds provided
therefore, and the personnel employed in the administration of the program shall be in any way
or to any extent engaged in the conduct of political activities in contravention of Chapter 15 of
Title 5, United States Code,referred to as the Hatch Act.
Owner shall adopt the audit requirements of the Office of Management and Budget (hereinafter
"OMB") Circular A-110, "Grants and Agreements with Institutions of Higher Education,
Hospitals, and Other Nonprofit Organizations," and Circular A-122, "Cost Principles for
Nonprofit Organizations," and OMB Circular A-133, "Audits of Institutions of Higher Education
and Other Non-Profit Institutions." Owner shall submit to the County copy of said audit report.
Owner shall permit the authorized representatives of the County, HUD and the Comptroller
General of the United States to inspect and audit all data and reports of the Owner relating to its
performance under the Agreement.
The County shall provide, upon request, copies of all laws, regulations and orders cited in this
Agreement.
Owner and County shall at all times observe and comply with Title 24 CFR Part 92 and all
applicable laws, ordinances or regulations of the Federal, State, County, and local government,
which may in any manner affect the performance of this Agreement, and Owner shall perform all
acts with responsibility to the County in the same manner as the County is required to perform
all acts with responsibility to the Federal government.
Owner hereby assures and certifies that it will comply with the regulations, policies, guidelines
and requirements with respect to the acceptance and use of Bond funds in accordance with the
policies'of the County.Also,Owner certifies with respect to the Project that:
1. The Project will be conducted and administered in compliance with:
Title VI of the Civil Rights Act of 1964(Pub. L. 88-352, 42 U.S.C. Sec 2000d et seq.) and
implementing regulations issued at 24 CFR Part I;
Title VIII of the Civil Rights Act of 1968 (Pub. L. 90-208, 42 U.S.C. Sec 2000d at seq.), as
7amended; and that the Owner will administer all programs and activities related to housing and
community development in a manner to affirmatively further fair housing;
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Section 109 of the Housing and Community Development Act of 1974, as amended; and the
regulations issued pursuant hereto;
Section 3 of the Housing and Urban Development Act of 1968, as amended;
Executive Order 11246-Equal Opportunity, as amended by Executive Orders 11375 and 12086,
and implementing regulations issued at 41 CFR Chapter 60;
Executive Order 11063-Equal Opportunity in Housing, as amended by Executive Order 12259,
and implementing regulations at 24 CFR Part 107;
Section 504 of the Rehabilitation Act of 1973 (Pub. L. 93-112), as amended, and implementing
regulations when published in effect;
The Age Discrimination Act of 1975 (Pub. L. 94135), as amended, and implementing regulations
when published for effect;
The Fair Housing Act(42 U.S.C. 3601-20);
VIII. ADMINISTRATION AND REPORTING REQUIREMENTS
1. Owner shall submit to the County a quarterly Progress Report no later than the fifth day
of the months of January,April;July;October until the activity has been reported completed.
2. After completion, the Owner is responsible for verifying the income of prospective
tenants and maintaining eligibility data. Owner shall maintain tenant files as part of its Books
and Records as required and for the period of time required by Section VI of this Agreement.
The Owner must provide the County an initial occupancy report verifying the income eligibility
of all tenants at the time of initial lease-up. The Owner must then furnish the County with an
annual report on the Project dwelling units by July 31 of each year thereafter certifying that all
tenants earn less than 60% of the area median income by family size, as determined by the US
Department of Housing and Urban Development and as amended from time to time.
Miscellaneous Provisions
a. Termination of Agreement. The full benefit of the Project will be realized only
after the completion of the affordability periods for all Project dwelling units. It is the County's
intention that the full public benefit of the Project shall be completed under the auspices of the
Owner for the assisted units as follows:
In the event that the Owner is unable to proceed with any aspect of the Project in a timely
manner, and County and the Owner determine that reasonable extension(s) for completion will
not remedy the situation, then the Owner will retain responsibility for requirements for any
dwelling units assisted and County will make no further payments to the Owner.
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In the event that the Owner, prior to the contract completion date, is unable to continue to
function due to, but, not limited to, dissolution or insolvency of the organization, its filing a
petition for bankruptcy or similar proceedings, or is adjudged bankrupt or fails to comply or
perform with provisions of this agreement, then the Owner shall, upon the County's request,
convey to the County the Property assisted with Bond funds. Conveyance shall be at the sole
discretion of County and on a Project dwelling unit by Project dwelling unit basis.
Conveyance shall be on the terms set forth herein:
Conveyance shall occur within thirty (30) days of County and the Owner's agreement of the
Owner's inability to continue as a viable organization. The Owner shall convey the Property to
the County by general warranty deed, free and clear of all liens and encumbrances of record
except those which create a beneficial interest in County (Declaration of Restrictive Covenants
and Deed of Trust).
e. Default, Remedies. This Agreement may be terminated by a non-defaulting
party upon an event of default hereunder, after written notice thereof and thirty (30) days grace
period in which the defaulting party may act to cure. As used herein, the term "an event of
default" shall mean and refer to a failure or act of omission by either party with respect to any
undertaking, obligation, covenant or condition as set forth in this Agreement. With respect to
any event of default, the non-defaulting party may exercise any right available to it at law or in
equity with respect to such default.
f. Books and Records. The Owner shall maintain records of its loan requirements
under this contract for a period of not less than the completion of the affordability periods for all
Project dwelling units.
L The Owner shall ensure access to records and financial statements, as necessary,
to provide effective monitoring and evaluation of project performance. Additionally, the Owner
shall submit a copy of its annual audit to the County.
ii. Upon reasonable advance notice, County or its authorized representatives may
from time to time inspect, audit, and make copies of any of the Owner records that relate to this
contract. If any audit by County discloses that payments to the Owner were in excess of the
amount to which the Owner was entitled under this contract, the Owner shall promptly pay to
County the amount of such excess. If the excess is greater than 1% of the contract amount, the
Owner shall also reimburse County its reasonable costs incurred in performing the audit.
iii. The Owner shall maintain files of all tenants, regardless of length of occupancy,
residing in assisted units. Documentation shall verify eligibility for federal assisted housing at
the point of initial tenancy and every subsequent year thereafter for the period of affordability.
Information maintained shall include: tenant income level;name of family members; ethnic data;
family type—e.g. female head of household; disability status;and monthly rent.
iv. The Owner shall maintain records verifying the affordability of the dwelling units.
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g. Notices. Any Notice shall be in writing and shall be given by depositing the same
in the United States mail, post-paid and registered or certified, and addressed to the party to be
notified, with return-receipt requested, or by delivering the same in person to an officer or
principal of such party. Notice deposited in the mail in the manner here in above described shall
be effective upon mailing. For purposes of Notice, the addresses of the parties shall, unless
changed as hereinafter provided, be as follows:
i. To the County: Orange County
c/o Housing, Human Rights and Community
Development
Department
P.O.Box 8181
Hillsborough,NC 27278
ATTN: Director
ii. To the Owner: Habitat for Humanity,
Orange County,North Carolina, Inc.
88 Vilcom Center Dr.#L110
Chapel Hill,NC 27514
Either the County or the Owner may change the person or address to which any future Notice
shall be given as herein provided.
h. No Assignment. No transfer or assignment of the interest of the Owner in this
Agreement shall occur without the prior written consent of the County; neither may the Owner
assign this Agreement without the prior written consent of County.
L Conflict of Interest. The Owner shall be aware of and observe the requirements
of the Orange County Affordable Housing Bond Program which provides that no member of the
Orange County Board of Commissioners shall be admitted to any share or part of this Agreement
or to any benefit to arise from the same. The Owner shall also be aware of and observe the
requirements which states that no member, officer, or employee of Orange County or its
designees or agents, no member of the governing body of the locality who exercised any
functions or responsibilities with respect to the program during his/her tenure or for one year
thereafter, shall have any private interest, direct or indirect, in this contract or any subcontract, or
the proceeds thereof, for work to be performed in connection with the program assisted under the
agreement.
j. Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
k. Indemnification. To the extent legally possible, the Owner shall indemnify and
hold County, its officers, agents, and employees, harmless from and against any and all claims,
actions, liabilities, costs, including attorney fees and other costs of defense, arising out of or in
any way related to any act or failure to act by the Owner, its employees, agents, officers, and
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contractors in connection with this contract. In the event any such action or claim is brought
against County, the Owner shall, upon County's tender, defend the same at the Owner's sole cost
and expense, promptly satisfy any judgment adverse to County or to County and the Owner
jointly, and reimburse County for any loss, cost, damage, or expense, including attorney fees
suffered or incurred by County.
1. Subcontracting. The Owner shall not subcontract work under this Agreement, in
whole or in part, without the County's prior written approval. The Owner shall require any
approved subcontractor to agree, as to the portion subcontracted, to comply with all applicable
federal, state, and local laws, rules, ordinances, and regulations at all times and in the
performance of the work and to comply with all applicable obligations of the Owner specified in
this contract. Notwithstanding County's approval of a subcontractor, the Owner shall remain
obligated for full performance of this contract and County shall incur no obligation to any
subcontractor the Owner shall indemnify, defend, and hold County harmless from all claims of
its contractors.
m. No Joint Venture or Agency. The County and the Owner each agree and
acknowledge that nothing contained herein or otherwise, including,without limitation, any act of
the County or the Owner under this Agreement, shall be deemed or construed to create any
relationship of joint venture,partnership or agency between the parties.
n. Effect of Waiver or Forbearance. No failure by the County to insist upon the
strict performance of any term or condition of this Agreement, or to exercise any right or remedy
upon the breach by the Owner of any of its obligations, agreements, or covenants hereunder,
shall be a waiver of such affected term or condition or of such breach; nor shall any forbearance
by the County to seek a remedy for any breach by the Owner be a waiver by the County of its
rights and remedies with respect to that or any other breach.
o. Governing Law. This Agreement shall be construed in accordance with and
governed by the laws of the State of North Carolina. Any litigation arising out of this Agreement
shall be brought in courts sitting in North Carolina,with venue in Orange County.
P. Severability. The provisions of this Agreement are independent of and separable
from each other, and no provision shall be affected or rendered invalid or unenforceable by the
fact that for any reason any other provision may be invalid or unenforceable in whole or in part.
If any provision of this Agreement or the application thereof to any person or circumstances
shall, to any extent, be or become invalid or unenforceable,the remainder of this Agreement, or
the application of such provision to persons or circumstances other than those as to which it is
held invalid or unenforceable, shall not be affected thereby, and each provision of this
Agreement shall be valid and be enforced to the fullest extent permitted by law. The County and
The Owner agree to substitute for such provision of this Agreement or the application thereof
determined to be invalid or unenforceable, such other provision as most closely approximates, in
a lawful manner, such invalid, illegal or unenforceable provision. If the County and the Owner
cannot agree, they shall apply to a court of competent jurisdiction to substitute such provision as
the court deems reasonable and judicially valid, legal and enforceable. Such provision
determined by the court shall automatically be deemed part of this Agreement ab initio.
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q. Equal Opportunity. The Owner shall not discriminate against any employee or
applicant for employment because of race, color, religion, sex, national origin, political
affiliation or belief, age,handicap,or familial status in the implementation of the Project.
r. Headings. Headings are for convenience only and shall not be used to interpret or
construe its provision.
S. Gender; Singular and Plural. As used herein, the neuter gender includes the
feminine and masculine. The masculine includes the feminine and neuter, and the feminine
includes the masculine and neuter and each includes a corporation, partnership or other legal
entity when the context so requires. The singular number includes the plural and vice versa,
whenever the context so requires.
t. Recording. The parties hereto agree that upon notice to the other and at its own
cost and expense, a party may record this Agreement in the Office of Register of Deeds for
Orange County.
U. Compliance with Laws. To the extent applicable, each party hereto agrees to
comply with all laws, ordinances and regulations affecting the Property from and after the date
hereof. Without limiting the generality of the foregoing, the Owner shall comply with all
federal, state and local laws, regulations and ordinances applicable to the expenditure of funds
provided by the County,to purchase and develop the Property.
V. Publicity; Signage. The Owner agrees to provide such publicity with respect to
the County's participation in the development of the Property as the County shall reasonably
require. Any signage at the Property shall acknowledge the County's role and contribution.
W. Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original but all of which together shall constitute one and the
same instrument.
X. No Third Party Rights. The parties hereto covenant and agree that nothing
contained in this Agreement or any act by the County or the Owner shall be deemed or construed
by the parties or any third party to create any relationship of third party beneficiary, including
third party principal or agent, or to create any right, claim or cause of action against the County,
the Owner or any of their respective officers, agents or employees by any third party.
Y. Performance of Government Functions. Notwithstanding anything in this
Agreement which may be to the contrary, nothing contained in this Agreement shall in any way
stop, limit or impair the County from exercising or performing any regulatory, policing or
governmental powers or functions with respect to the Property including, without limitation,
inspection of the Property in the performance of such functions.
Z. Duration of Agreement. This Agreement shall be effective on the date of
execution and shall remain in effect during the period of affordability required by the recorded
Declaration of Restrictive Covenants.
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IN WITNESS WHEREOF,the parties hereto, intending to be legally bound, have set their hands
and seals on the day and year first above written.
ORANG O Y,NOR C OLINA
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V
iC-J�Iald IA(b�.�'�1 �ll'fe�'r rn ru's
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ATTEST:
Do&ia Vakrr
Clerk to the Board of Commissioners
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jAette e to form and legality 17 52
a
ore, Sta AttorneyOrth taco`
This document has been preaudited in accordance with the N.C. Local Government and Fiscal
C of Act. y� y
ty Clarence Grier,Finance Director
HABITAT FOR HUMANITY,
ORANGE CO Y.NORTH CAROLINA,INC.
By: �----�
Z.c e Vice- PKS;alenf
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EXHIBIT A
Property Description
Rusch Hollow Lot 3 in the Orange County,North Carolina, Register of Deeds Office, Plat Book
96, Page 84 and extended by recombination to include Lot 3A as shown on the Recombination
Plat Lot 3 Rusch Hollow & Lot 3, Block A, "Property of Roberts Construction Company" and
recorded in Plat Book 101,Page 91:
BEGINNING at an iron in the Southwest corner of Lot 3, Rusch Hollow, as shown as Plat Book
96,Page 84, Orange County Registry;running from said beginning point North 66°21' 27"West
203.27 feet to an iron, thence South 0° 03' 34" East 43.89 feet to an iron, thence South 56° 14'
27" East 175.66 feet to an iron, thence North 33° 50' 07" 72.22 feet to the place and point of
BEGINNING, containing 10,431 square feet,more or less.
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EXHIBIT B
Scone of Services
Services to be provided are in accordance with the September 8, 2012 Orange County Affordable
Housing Bond Application and the Performance Agreement entered into by Habitat for
Humanity,Orange County,North Carolina and the Town of Chapel Hill dated July 1, 2013.
All construction will be completed in compliance with applicable state and local building codes
and ordinances.
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EXHIBIT C
Proiect Budaet
Habitat for Humanity of Orange County
Pronosed Budeet for Construction of Rusch Hollow Duplex
Appliances $ 2,000
Porch/Deck $ 1,300
Electrical $ 5,950
Equipment Rental $ 1,300
Framing, Siding,Windows,Roofing $ 33,500
Floor Covering $ 6,400
Foundation(materials and labor) $ 3,250
Grading/Footing $ 12,500
HVAC $ 10,200
Insulation $ 6,400
Interior Trim&Cabinets $ 5,250
Misc. $ 1,000
Paint $ 750
Permits and Fees $ 13,220
Plumbing $ 11,250
Sewer, Water Line&Tap-On Fees $ 8,546
Sheetrock $ 6,750
Utilities $ 1,350
Yard&Landscape $ 1,500
Driveway $ 4,750
Total Direct Costs $ 137,166
Insurance-B1drs.Risk $ 1,100
Survey Closing Costs $ 1,500
Administration/overhead @5%of direct cost $ 6,858
Total Cost $ 146,624
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