Loading...
HomeMy WebLinkAboutAgenda - 12-19-1995 - VIII-E r 1 ORANGE COUNTY BOARD OF COMMISSIONERS Action Agenda Item No VIM-g ACTION AGENDA ITEM ABSTRACT Meeting Date: December 19, 1995 SUBJECT: HOME Program - Development Agreement -------------------------------- ------------------------------- DEPARTMENT: Housing/Comm. Dev. PUBLIC HEARING YES NO —x- -------------------------------- ------------------------------- ATTACHMENT(S) : INFORMATION CONTACT Development Agreement Tara L. Fikes, x 2490 TE LE PHONE NUMBER Hillsborough 732-8181 Chapel Hill 968-4501 Mebane 227-2031 Durham 688-7331 ----------------------------------------------------------------------- PURPOSE: To approve the Development Agreement with the Orange Community Housing Corporation (OCHC) for the Carr Court HOME Program activity. BACKGROUND: In the 1995-96 Orange County HOME Program, approximately $162, 000 in HOME funds was designated for the acquisition of the two multifamily buildings (eight units total) in the Carr Court neighborhood in Carrboro. Plans have been made to renovate these apartments utilizing private financing. Developers of this project are Orange Community Housing Corporation (OCHC) and an interested local builder Arne Gray. Since the HOME funds will be expended by OCHC, Orange County as lead entity for the Consortium must enter into a legally enforceable agreement between the County and OCHC requiring OCHC to carry out the proposed activities in accordance with applicable HOME Program regulations. This document has been forwarded to the County Attorney for review. RECOMMENDATION: The Manager recommends approval of the Development Agreement with the Orange Community Housing Corporation for the Carr Court Project and authorize the Chair to sign the document on behalf of the Board upon approval by the County Attorney. e 2 NORTH CAROLINA ORANGE COUNTY DEVELOPMENT AGREEMENT 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 ORANGE COMMUNITY HOUSING CORPORATION, a North Carolina nonprofit corporation (hereinafter referred to as "OCHC"). The date of this Agreement is December 19, 1995. WITNESSETH WHEREAS, the Orange County HOME Consortium has designated $162,000 in FY 1995 HOME funds for the purpose of conveying these funds to OCHC to acquire and develop the Carr Court Townhomes, which property is more particularly described in Exhibit A attached hereto and made a part of this Agreement (hereinafter referred to as the "Property"); and WHEREAS, the County is the lead entity of the Orange HOME Consortium, so designated in an agreement dated August 27, 1992, and amended January 26, 1993, and July 28, 1993, and as such is the lead entity in a representative capacity for all members of the Orange HOME Consortium for the purposes of carrying out the HOME Program in accordance with the Title II of the Cranston-Gonzalez National Affordable Housing Act (Pub. L. 101-625), (42 U.S.C. 3535(d.) et. seq.) (hereinafter referred to as the "Act"), and as further defined in the Federal Program Requirements provided by the U.S. Department of Housing and Urban Development; and WHEREAS, OCHC intends to purchase and develop the Property for the purpose of constructing homeownership opportunities for first-time homebuyers. NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto do agree as follows: 1. OCHC agrees to purchase the property for a total price of $143,800 using HOME funds from the County for this purpose, such funds to be provided prior to the date of the closing of the purchase of the property. The County also agrees to fund closing costs, including but not limited to attorney fees, title and recording fees, prorated taxes, appraisal and survey fees, and other reasonable costs associated with purchasing the subject property, using HOME funds up to a total of $161,000. OCHC agrees to develop and sell the townhomes at a price not to exceed the current NC Housing Finance Agency maximum existing home sales price in effect at the time of purchase. Any HOME funds not used to complete the purchase of the property may be drawn by OCHC for other eligible project costs, as indicated in the Project Budget attached to and a part of this document with the exception of administrative fees. 3 2. The purchase of the lots by OCHC with HOME funds shall be secured by a note from OCHC to the County and a deed of trust constituting a first lien on the property purchased which deed of trust shall designate Orange County as the secured party/beneficiary. The note and deed of trust shall be in the form of the documents that are attached to and a part of this document. Orange County agrees to subordinate its mortgage interest on each lot to private construction financing acquired by OCHC in order to complete the project. 3. OCHC agrees to contract with Ame Gray, an interested private developer, to complete improvements on the property. The improvements will consist of converting the eight (8) existing units into six (6) townhome units that can be sold as individual townhomes, and further agrees to coordinate and supervise the distribution of construction loan funds. OCHC and Orange County acknowledge that Mr. Gray was selected through a non-competitive bidding process by the Orange County HOME Consortium as the participating private partner. 4. OCHC agrees to secure financing for the construction of the project, subject to the availability of favorable financing. 5. OCHC agrees to prepare a marketing plan prior to the closing date for the purchase of the property, which will be incorporated into this document upon approval of the Orange County HOME Program Consortium. The Consortium recognizes the difficulty in determining marketing strategy, thus the plan will include activities to be undertaken by other parties. 6. Once potential purchasers are identified through marketing efforts specked in the marketing plan, OCHC will perform all activities necessary to complete the sale, including but not limited to: prequalifying the potential purchasers for a mortgage, obtaining credit information, providing homeownership education, preparing a sales contract and other necessary documents. Orange County agrees to provide legal services for preparation of townhome documents and homeowners association documents necessary to be able to sell the homes prior to the completion of construction. OCHC will fund the cost of all other legal services in the attached Project Budget from other sources, including the HOME funds. 7. In the event the townhomes constructed at Carr Court are not sold at a date 18 months from the date of closing of the purchase of the property, OCHC may elect to (a) continue to market the properties for sale to eligible buyers, or (b) attempt to secure tenants who may qualify for lease-to-purchase programs and be qualified to purchase the property within 2 years form the date of tenancy, converting the construction loans outstanding to permanent mortgages. OCHC must notify Orange County on a date 12 months from the date of the closing of the purchase of the property of its intentions in the event the townhomes are not sold by that date. 4 8. In the event the townhomes constructed at Carr Court are not sold at a date 24 months from the date of closing of the purchase of the property, OCHC may elect to (a) sell the remaining properties to a private investor with no restrictions and repay the HOME funds outstanding; (b) sell the remaining properties to a private investor for use as affordable rental units subject to the restrictions found in the HOME Program, subject to approval of the sale and transfer of the loan obligations to the private investor by Orange County; or (c) retain ownership of the units and maintain them as rental units subject to the restrictions found in the HOME program. OCHC must notify Orange County on a date 20 months from the date of the closing of the purchase of the property of its intentions in the event the townhomes are not sold by that date. 9. OCHC agrees to sell the homes to qualified buyers whose incomes do not exceed 80% of the area median income by family size, as determined by the U.S. Department of Housing and Urban Development and amended ftm time to time. At the closing of the sale to a homebuyer of each lot, OCHC shall repay the County, $26,833.33 in the form of a credit to the homebuyer. The credit to the homebuyer shall be documented by a promissory note from the homebuyer to the County which note shall be secured by a deed of trust on the property naming the County as beneficiary. The County agrees to subordinate its mortgage interest on each lot to a first lien private mortgage acquired by the buyer. The period of affordability for HOME funds in accordance with the Acts, its regulations and State Program Requirements shall be 15 years from the date of execution of this Agreement. The default interest rate shall be 7% per annum. OCHC shall provide to Orange County prior to closing the sale of each home documentation, satisfactory to the County, verifying the income of each buyer. 10. Miscellaneous Provisions. a. Termination of Agreement. The obligations of the parties hereunder and the specific obligation of OCHC to purchase the Property and construct homes thereon shall terminate upon the completion of the sale of the targeted six townhomes to qualified buyers. Continuing obligations of the buyers shall be contained in the note and deed of trust to be recorded at the time of closing of the sale of each home. Notwithstanding the foregoing, the parties hereto may terminate this Agreement at any time by a mutual agreement to that effect in writing. b. 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. 5 C. Books and Records. Each party shall keep and maintain books, records and other documents relating directly to the receipt and disbursement of grant funds and the fulfillment of this Agreement. Each party agrees that any authorized representative of the County, the State, the U.S. Department of Housing and Urban Development and Comptroller General of the United States shall, at all reasonable times, have access to and the right to inspect, copy, audit and examine all of the books, records and other documents relating to the grant and the fulfillment of this Agreement for a period of three (3) years following the completion of the Project. d. Conflict with HOME Agreement. Notwithstanding anything herein to the contrary, the parties hereto acknowledge the due execution of a HOME Program Agreement between the County and the U.S. Department of Housing and Urban Development and agree that any conflict between the provisions, requirements, duties or obligations of this Agreement and the HOME Agreement shall be resolved in favor of the HOME Agreement. e. 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 Go Housing and Community Development Department P.O. Box 8181 Hillsborough, NC 27278 ATTN: Director ii. To OCHC: Orange Community Housing Corporation P.O. Box 307 Carrboro, NC 27510-0307 ATTN: Executive Director Either the County or OCHC may change the person or address to which any future Notice shall be given as herein provided. f. No Assignment. No transfer or assignment of OCHC's interest in this Agreement shall occur without the prior written consent of the County. 6 g. Binding Effect. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns. h. Entire Agreement; Modification. This Agreement, with all exhibits and attachments hereto, constitutes the entire agreement between the County and OCHC. No modification or amendment to this Agreement shall be binding upon either party unless made in writing and executed by each party. i. No Joint Venture or Agency. The County and OCHC each agree and acknowledge that nothing contained herein or otherwise, including, without limitation, any act of the County or OCHC under this Agreement, shall be deemed or construed to create any relationship of joint venture, partnership or agency between the parties. j. 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 OCHC 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 OCHC be a waiver by the County of its rights and remedies with respect to that or any other breach. k. 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. I. 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 OCHC 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 OCHC 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. r 7 M. Equal Opportunity. OCHC shall not discriminate against any employee or applicant for employment because of race, color, religion, sex, national origin, political affiliation or belief, age, or handicap. n. Headings. Headings are for convenience only and shall not be used to interpret or construe its provision. o. 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. P. 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. q. 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, OCHC 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. r. Publicity; Signage. OCHC 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. S. 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 on and the same instrument. t. No Third Party Rights. The parties hereto covenant and agree that nothing contained in this Agreement or any act by the County or OCHC 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, OCHC or any of their respective officers, agents or employees by any third party. U. 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, c 8 policing or governmental powers or functions with respect to the Property including, without limitation, inspection of the Property in the performance of such functions. 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. COUNTY OF ORANGE, NORTH CAROLINA (SEAL) Moses Carey, Jr., Chairman Orange County Board of Commissioners ATTEST: Beverly A. Blythe Clerk to the Board of Commissioners NORTH CAROLINA ORANGE COUNTY This is to certify that on this day personally came before me Beverly A. Blythe, with whom I am personally acquainted, and being by me duly sworn, says that Moses Carey, Jr., is the Chairman of the Orange County Board of Commissioners, and that she the said Beverly A. Blythe, is the Clerk to the Board of Commissioners of the County of Orange, the body politic and corporate named within and which executed the foregoing instrument; that she knows the common seal of said County; that the seal affixed to said instrument is said common seal; that the name of Orange County was subscribed thereto by the said Chairman of the Orange County Board of Commissioners and that the said Chairman of the Orange County Board of Commissioners and said Beverly A. Blythe subscribed their names hereto and said common seal was affixed, all by order of the Board of County Commissioners of Orange County and that said instrument is the act and deed of Orange County. Witness my hand and notarial seal, this the day of 199_. Notary Public My commission expires: 9 ORANGE COMMUNITY HOUSING CORPORATION (SEAL) Keith Cook, Chair Board of Directors ATTEST: Keith Aldridge, Secretary Board of Directors NORTH CAROLINA ORANGE COUNTY I, Notary Public in and for the above named County and State, do hereby certify that on this day personally appeared before me Keith Aldridge, with whom I am personally acquainted, who, being by me duly sworn, says at she is Secretary and that Keith Cook is Chair of the Board of Directors of Orange Community Housing Corporation, a North Carolina corporation, and that by authority duly given and as the act of the corporation, the foregoing instrument was signed in its name by its President, sealed with its corporate seal and attested to by its Secretary. Witness my hand and notarial seal, this the day of 199_ Notary Public My commission expires: