HomeMy WebLinkAbout2020-043-E Housing - Community Home Trust 200 Culbreth Park development agreement1
NORTH CAROLINA
DEVELOPMENT AGREEMENT
ORANGE COUNTY
This is an AGREEMENT between ORANGE COUNTY, a body politic and corporate, a
political subdivision of the State of North Carolina, (hereinafter referred to as the “County”), and
ORANGE COUNTY, NORTH CAROLINA, a general local governmental unit of the State of
North Carolina, (hereinafter referred to as the “County”) and COMMUNITY HOME TRUST
INC., a North Carolina non-profit corporation (hereinafter referred to as “CHT” or “Owner”).
The effective date of this agreement is __01/23/2020____________.
WITNESSTH
WHEREAS, on May 18, 2018, the Orange County HOME Consortium designated up to
Sixty Thousand Dollars ($60,000) in FY 2018-19 HOME Funds, for the purpose of homebuyer
financial assistance for up to two (2) families in the Northside and Pine Knolls neighborhood of
Chapel Hill; and
WHEREAS, the County is the lead entity of the Orange County HOME Consortium, so
designated in an agreement dated July 1, 2011 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, CHT submitted a request, memorialized in a writing dated December 10,
2019 for the reallocation of FY 2018-19 HOME funds to assist in the acquisition of property for
resale to a household earning less than 80% of the HUD area median income; and
WHEREAS, on December 2, 2019 the Orange County Board of County Commissioners
approved CHT’s request and reallocated $15,000 to CHT for the aforementioned purpose; and
WHEREAS, CHT has proposed to utilize the aforementioned funding to support the
acquisition of the property the located at 200 Culbreth Park Drive in Chapel Hill, NC, hereinafter
referred to as the “Property” or “the housing unit” and more specifically described in EXHIBIT
A; and
WHEREAS, CHT plans acquire and assist in the resale of the Property to a homebuyer
earning no more than 80% of the HUD area median income as described in their Request for
HOME funds for 200 Culbreth Park Drive, Chapel Hill, NC 27517, dated December 10, 2019,
which request is incorporated by reference into this Agreement, and hereinafter referred to as the
Project. Their December 10, 2019 request is on file in the office of the Orange County Department
of Housing and Community Development; and
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WHEREAS, the Property would be held in a Community Land Trust (CLT), ensuring
affordability of the home for at least 99 years; and
WHEREAS, notwithstanding any provision of this Agreement, the County and the Owner
hereto agree and acknowledge that this Agreement does not constitute a commitment of funds or
site approval, and that such commitment of funds or approval may occur only upon satisfactory
completion of an environmental review and receipt by Orange County of a Release of Funds from
the U.S. Department of Housing and Urban Development under 24 CFR Part §58 if applicable.
The parties further agree that the provision of such funds to the project is conditioned on Orange
County’s determination to proceed with, modify, or cancel the project based on the results of a
subsequent environmental review.
NOW, THEREFORE, in consideration of the mutual covenants, promises, and representations
contained herein, it is agreed between the parties hereto as follows:
1.CHT agrees to convey the housing unit to a homebuyer with income of 80% or less 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 sale. A housing unit will consist of a 99-
year ground lease (renewable for an additional 99 years) to the housing unit and a warranty
deed to any improvements on the leased premises.
2.The period of affordability will be at least 99 years and will be secured by a CHT Ground
Lease of the housing unit with restrictions to ensure compliance. Further security shall be in
the form of a Declaration of Restrictive Covenants (Exhibit D) that will make the County a
third party beneficiary of and successor to the long term affordability remedies in the Ground
Lease in the event of a failure of or inability of CHT to enforce the long term affordability
remedies in the Ground Lease.
3.CHT is responsible for soliciting CHT Ground Lease tenants for the housing unit. CHT and/or
the Ground Lease tenants shall be responsible for securing permanent mortgage financing for
the housing unit.
4.CHT is responsible for verifying the income of the Ground Lease tenants, explaining the land
trust program and the CHT Ground Lease to potential tenants and certifying by written
documentation signed by the tenants that the program requirements have been fully explained.
CHT shall maintain purchaser files as part of its Books and Records as required and for the
period of time required by Section 15.F. of this Agreement.
5.At the time of resale of the housing unit, CHT will convey the housing unit to a qualified
homebuyer. The housing unit will consist of a 99 year Ground Lease (renewable for an
additional 99 years) to the project dwelling unit. The Ground Lease, the form of which is
Exhibit E hereto, provides for the long term affordability (at least 99 years) of the housing
unit and provides remedies to insure the long term affordability of the housing unit. All
Exhibits, attachments and addendums annexed hereto or referred to herein are hereby
incorporated into and made a part of this Agreement as if set forth herein, as it now reads or
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as it may be modified by the Parties. CHT hereby declares and covenants, on behalf of itself
and all future owners of the Property, that, during the term of the Declaration of Restrictive
Covenants, the County is a third party beneficiary of and successor to each and every remedy
intended to insure the long term affordability of the housing unit that is provided for in the
Ground Lease and may, in the event of the failure or default of the Lessor in the Ground Lease
to insure the long term affordability of the housing unit as provided for in the Ground Lease,
exercise all rights and remedies available to the Lessor in the Ground Lease for that purpose.
6.The housing unit must have a value that does not exceed 95% of the area median purchase
price for that type of housing.
Value must be established by one of the following methods:
i. An appraisal by a qualified appraiser.
ii. Tax assessments may be used to establish value, but only if they are current and
can be computed at 100% of market value.
7.USE OF HOME FUNDS/SUBSIDY TYPE
A. CHT shall perform the projects or tasks related to its allocation of HOME funds as
provided in Exhibit B, Scope of Services; Exhibit C, Project Budget; the Declaration of
Restrictive Covenants the form of which is attached as Exhibit D; and the Ground Lease,
the form of which is attached as Exhibit E. All Exhibits, attachments and addendums
annexed hereto or referred to herein are hereby incorporated into and made a part of this
Agreement as if set forth herein, as it now reads or as it may be modified by the Parties.
B. CHT may not request disbursement of funds under this Agreement until the funds are
needed for payment of eligible costs. The amount of each request must be limited to the
amount needed for eligible costs as determined by Orange County staff and may not
exceed the amount needed.
C. Said funds shall be disbursed by check payable to CHT.
D. HOME funds provided will be as a fixed subsidy in the form of a deferred loan.
8. AMOUNT OF HOME FUNDS/GRANT TERMS
The County shall make available to the Owner up to Fifteen Thousand Dollars ($15,000) at
an interest rate of zero percent (0%) pursuant to this Agreement. The funding provided by
the County will be provided as a fixed subsidy in the form of a deferred loan. The investment
will be secured by a forty (40) year Deed of Trust and Promissory Note, forgivable at the end
of forty (40) years. This Deed of Trust, recorded in the Orange County Registry, and
Promissory Note shall constitute a lien on the Property.
Said funds shall be disbursed by the County to CHT for performance of the services described
in Exhibit B.
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9. LIEN POSITION
Orange County hereby acknowledges that the terms and conditions of its (i) HOME Program
Development Agreement, (ii) Promissory Note, (iii) Deed of Trust and Security Agreement,
and (iv) Declaration of Restrictive Covenants (collectively referred to as the “Orange County
Loan Documents”), for CHT shall not be subordinate to any other documents. The Declaration
of Restrictive Covenants (EXHIBIT D) described in Section 11 of this Agreement shall be
recorded prior to the Deed of Trust.
10. TIMELINESS
CHT shall complete the Project within six (6) months from the date of this Agreement.
However, in the event of any alterations or additions or circumstances beyond the control of
the Owner, which in the opinion of the Director of the County’s Department of Housing 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. CHT will be responsible for
providing status reports to the County quarterly detailing the project activities until project
completion. In addition, CHT agrees to furnish to the County a copy of its annual audit
performed by a certified public accountant within 90 days of the end of each fiscal year until
the Project is complete.
The Project completion date is the closing date of the Ground Lease by a qualified buyer of
the last of the Project dwelling units. In the event that CHT is unable to proceed with any
aspect of the project in a timely manner, and County and CHT determine that reasonable
extension(s) for completion will not remedy the situation, then the Termination of Agreement
provisions of this Agreement (Section 15.D.) shall pertain. CHT may, at its option, submit a
written request for a delay of completion for County approval. The County may, at its option,
approve any delay in the completion date or declare CHT in default.
CHT shall monitor the housing units for affordability for the period of affordability –
ninety-nine (99) years and, if renewed, an additional ninety-nine years. Final contract
completion date shall be the end date of the last affordability period.
11. DURATION OF THE AGREEMENT AND AFFORDABILITY REQUIREMENT
This Agreement will remain in effect for the Period of Affordability. Upon termination or
expiration of this Agreement, CHT shall transfer to the County any HOME funds on hand at
the time of expiration and accounts receivable attributable to the use of HOME funds.
Housing assisted with HOME funds must meet the affordability requirements of 24 CFR
92.254. Under this Agreement, each housing unit must remain affordable for a period of
ninety-nine years. CHT retains full responsibility for compliance with the affordability
requirement for assisted housing units. CHT shall assure compliance with affordability of
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assisted housing units by having recorded, no later than the time it leases the first of the
housing units, a "Declaration of Restrictive Covenants" on the Property, the form of which is
attached as Exhibit D to this Agreement. To further assure compliance with the affordability
requirements the Ground Lease shall be made an attachment to the Declaration of Restrictive
Covenants and recorded therewith. All other security documents should be recorded
thereafter.
This Declaration shall constitute and remain a first lien on the Property during the period of
affordability, unless otherwise provided by law or unless otherwise agreed by County.
It is further the responsibility of CHT to rerecord the Declaration of Restrictive Covenants no
later than one day before the expiration of 30 years of the date of its lease of each of the
housing units in the event the homeowner leasing the housing unit from CHT is still the owner
of the housing unit at the time of the rerecording. County retains the right to periodically and
every 30 years after the first recording of the Declaration of Restrictive Covenants 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 § 4713-4 or any
comparable preservation law in effect at the time of the recording of the notice of preservation.
It is the intent of this Section of this Agreement that the 99 year affordability requirement
contained herein be accomplished and that CHT and the County will do what is necessary to
ensure that the same is not extinguished 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. CHT and the County agree to do what each must do to accomplish the 99 year
affordability requirement.
12. RESALE PROVISIONS. CHT shall assure compliance with long term affordability of
assisted housing units as provided for in the Ground Lease, which Ground Lease shall, as to
resale provisions, remain in substantially the form of the current version of the Ground Lease,
a copy of which is an exhibit to the Declaration of Restrictive Covenants, for at least 99 years.
13. CHT PERFORMANCE UNDER THIS AGREEMENT
A. CHT 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.
B. CHT 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 CHT in the
Project or payments made pursuant to this Agreement.
C. CHT 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.
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D. CHT shall comply with audit requirements contained in 2 CFR, Subpart F which
requires CHT to have an annual audit conducted within nine (9) months of the end of
their fiscal year, if CHT has an aggregate expenditure of more than $750,000 in federal
funds in a fiscal year. CHT shall submit to the County copy of said audit report. CHT
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 CHT relating to
its performance under the Agreement. Any deficiencies noted in audit reports must be
fully cleared by the CHT within thirty (30) days after receipt of same.
If CHT is not required to perform an audit per the 2 CFR, Subpart F requirements, it must
have and maintain adequate internal financial/cash management principles and reporting
policies.
E. County shall provide, upon request, copies of all laws, regulations and orders cited in this
Agreement.
F. CHT 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
CHT 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.
G. CHT hereby assures and certifies that it will comply with the regulations, policies,
guidelines and requirements with respect to the acceptance and use of HOME funds in
accordance with the policies of the County. Also, CHT certifies with respect to the Project
that it will be conducted and administered in compliance with:
1. Title VI of the Civil Rights Act of 1964 (Pub. L. 88-352, 42 U.S.C.§§ 2000d et
seq.) and implementing regulations issued at 24 CFR Part I;
2. Title VIII of the Civil Rights Act of 1968 (Pub. L. 90-208, 42 U.S.C. §§ 2000d
at seq.), as amended; and that Habitat will administer all programs and activities
related to housing and community development in a manner to affirmatively
further fair housing;
3. Section 109 of the Housing and Community Development Act of 1974, as
amended; and the regulations issued pursuant hereto;
4. Section 3 of the Housing and Urban Development Act of 1968, as amended;
5. Executive Order 11246-Equal Opportunity, as amended by Executive Orders
11375 and 12086, and implementing regulations issued at 41 CFR Chapter 60;
6. Executive Order 11063-Equal Opportunity in Housing, as amended by Executive
Order 12259, and implementing regulations at 24 CFR Part 107;
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7. Section 504 of the Rehabilitation Act of 1973 (Pub. L. 93-112), as amended, and
implementing regulations when published in effect;
8. The Age Discrimination Act of 1975 (Pub. L. 94135), as amended, and
implementing regulations when published for effect;
9. The Fair Housing Act (42 U.S.C. 3601-20);
10. Title II of the American Disabilities Act;
H. CHT certifies by executing this Agreement that they have not been identified, and have
not utilized the services of any agent or subcontractor identified, on the list created by
the State Treasurer pursuant to G.S. 147-86.58. By executing this Agreement CHT
certifies that they have not been identified, and have not utilized the services of any
agent or subcontractor identified, on the list created by the State Treasurer pursuant to
G.S. 147-86.81. By executing this Agreement CHT affirms they are and shall remain in
compliance with Article 2 of Chapter 64 of the North Carolina General Statutes.
14. ADMINISTRATION AND REPORTING REQUIREMENTS
CHT 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.
15. MISCELLANEOUS PROVISIONS
A. Uniform Administrative Requirements. The Owner must comply with the applicable
uniform administrative requirements of 24 CFR §92.505.
B. Other Program Requirements. CHT must carry out each activity in compliance with
all Federal laws and regulations described in 24 CFR, Part 35 subparts A, B, J, K, M, and
R, as applicable; 24 CFR, Part 92, subpart F for homeownership projects, including but
not limited to the applicable property standards at 92.251; and 24 CFR, Part 92, subpart
H except that the subrecipient does not assume the responsibilities for environmental
review or intergovernmental review. Applicable property standards shall apply throughout
the period of affordability.
C. Affirmative Marketing. If HOME funds will be used for housing containing five (5) or
more assisted units, CHT must prepare and submit an Affirmative Marketing Plan to the
County, in accordance with 24 CFR 92.351.
D. 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 CHT for the assisted units as follows:
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1. In the event that CHT is unable to proceed with any aspect of the Project in a timely
manner, and County and CHT determine that reasonable extension(s) for completion
will not remedy the situation, then CHT will retain responsibility for requirements for
any dwelling units assisted and County will make no further payments to the CHT.
2. In the event that CHT, 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 CHT shall, upon the
County’s request, convey to the County the Property assisted with HOME 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:
a. Conveyance shall occur within thirty (30) days of County and CHT's agreement
of CHT’s inability to continue as a viable organization.
b. CHT 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. Notwithstanding and in addition to
the above, in accordance with 24 CFR 85.43, this Agreement may be suspended or
terminated by the County if CHT materially fails to comply with any term of the
Agreement. Remedies for breach of the provisions of this Agreement include but are not
limited to repayment of any funds deemed to be expended in an ineligible manner.
Repayment of HOME fund is required if the housing does not meet the affordability
requirements for the Period of Affordability.
F. Books and Records. CHT shall maintain records of its grant requirements under this
contract for a period of not less than five (5) full fiscal years following the contract
completion date.
1. CHT shall ensure access to records and financial statements, as necessary, to provide
effective monitoring and evaluation of project performance. Additionally, CHT shall
submit a copy of its annual audit to the County.
2. Upon reasonable advance notice, County or its authorized representatives may from
time to time inspect, audit, and make copies of any of CHT' records that relate to this
contract. If any audit by County discloses that payments to CHT were in excess of the
amount to which CHT was entitled under this contract, CHT shall promptly pay to
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County the amount of such excess. If the excess is greater than 1% of the contract
amount, CHT shall also reimburse County its reasonable costs incurred in performing
the audit.
3. CHT shall maintain files of all purchasers residing in assisted units. Documentation
shall verify eligibility for federal assisted housing at the initial occupancy.
Information maintained shall include: tenant income level; name of family members;
ethnic data; family type – e.g. female head of household and disability status.
4. CHT shall maintain records verifying the affordability of the dwelling units.
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 and Community Development
Department
P.O. Box 8181
Hillsborough, NC 27278
ATTN: Director
ii. To CHT: Community Home Trust
109 Conner Drive, Suite 1000
Chapel Hill, NC 27514
ATTN: Executive Director
Either the County or CHT 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 CHT on this Agreement shall
occur without the prior written consent of the County; neither may CHT assign this
Agreement without the prior written consent of County.
I. Conflict of Interest. CHT agrees to abide by the provisions of 24 CFR 92.356(f) and 24
CFR 570.611, as applicable, with respect to conflicts of interest, and covenants that it
presently has no financial interest and shall not acquire any financial interest, direct or
indirect, that would conflict in any manner or degree with the performance of services
required under this Agreement. CHT further covenants that in performance of this
Agreement no person having such a financial interest shall be employed or retained by
CHT hereunder. These conflicts of interest provisions apply to any person who is an
employee, agent, consultant, or elected official or appointed official of the County, or any
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designated public agencies or subrecipients that are receiving funds under the County
HOME Investment Partnership Program.
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, CHT 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 CHT, its employees, agents, officers, and
contractors in connection with this contract. In the event any such action or claim is
brought against County, CHT shall, upon County's tender, defend the same at CHT’s sole
cost and expense, promptly satisfy any judgment adverse to County or to County and CHT
jointly, and reimburse the County for any loss, cost, damage, or expense, including
attorney fees suffered or incurred by the County.
L. Subcontracting. CHT shall not subcontract work under this Agreement, in whole or in
part, without the County's prior written approval. CHT 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 CHT specified
in this contract. Notwithstanding County's approval of a subcontractor, CHT shall remain
obligated for full performance of this contract and County shall incur no obligation to any
subcontractor. CHT shall indemnify, defend, and hold County harmless from all claims
of its contractors. By executing this Agreement Owner affirms that they and any
subcontractors of Owner are and shall remain in compliance with Article 2 of Chapter 64
of the North Carolina General Statutes. Owner also certifies that they have not been
identified, and have not utilized the services of any agent or subcontractor, on the list
created by the State Treasurer pursuant to G.S. § 147-86.58.
M. No Joint Venture or Agency. The County and CHT each agree and acknowledge that
nothing contained herein or otherwise, including, without limitation, any act of the County
and CHT 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 CHT 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 CHT 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.
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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 CHT 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 CHT 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.
Q. Equal Opportunity. CHT 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, CHT 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. CHT 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 on and the
same instrument.
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X. No Third Party Rights. The parties hereto covenant and agree that nothing contained in
this Agreement or any act by the County or CHT 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, CHT 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 Act under 24 CFR
Part 92.
AA. Training. The Owner agrees to attend training and/or technical assistance
workshops provided by the County related to the administration of this Agreement and
that the Department of Housing and Community Development deems mandatory.
BB. Entire Agreement and Signatures: The parties have read this Agreement and
agree to be bound by all of its terms, and further agree that it constitutes the complete and
exclusive statement of the Agreement between the parties unless and until modified in
writing and signed by the parties. Modifications may be evidenced by telefacsimile
signature. This Agreement together with any amendments or modifications may be
executed electronically. All electronic signatures affixed hereto evidence the consent of
the Parties to utilize electronic signatures and the intent of the parties to comply with
Article 11A and Article 40 of North Carolina General Statute Chapter 66.
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.
[SIGNATURE PAGE TO FOLLOW]
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SIGNATURE PAGE
ORANGE COUNTY, NORTH
___________________________________
COMMUNITY HOME TRUST, INC.
CAROLINA
_________________________________
.LPEHUO\6DQFKH], President Bonnie Hammersley, County Manager
This document has been pre-audited in accordance with the N.C. Local Government and Fiscal
Control Act.
Gary Donaldson, Finance Director
___________________________
Approved as to form and legality
____________________________
Anne Marie Tosco, Staff Attorney
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EXHIBIT A
PROPERTY DESCRIPTION
PIN: 9787-18-1780
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EXHIBIT B
SCOPE OF SERVICES
HOME funds will be used to assist with the acquisition of a house located at 200 Culbreth Park
Drive, Chapel Hill, North Carolina.
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Exhibit C
PROPOSED BUDGET
Proposed Uses of Funds
Acquisition $15,000
Total Uses of Funds $15,000
Sources of Funds
Orange County HOME funds $15,000
Total Sources of Funds $15,000
CHT may not request disbursement of funds under this Agreement until the funds are needed for
payment of eligible costs. The amount of each request must be limited to eligible costs as
determined by the County’s Housing and Community Development Department (“HCD").
Funds may be shifted between line items of the Project without prior approval of the County only
to the extent of “Minor Adjustments,” defined as actions which do not result in a change in the
Project and so long as such Minor Adjustments do not exceed ten percent (10%) of the line item
total from which the funds are being removed or to which the funds are being added, there is no
increase to the Total Renovation Cost specified in the above budget, and there are only minor
changes to the Plans and Specifications.
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Exhibit D
Prepared by and return to: Anne Marie Tosco, Orange County Attorney’s Office
P.O. Box 8181; Hillsborough, NC 27278
DECLARATION OF RESTRICTIVE COVENANTS
THIS DECLARATION OF RESTRICTIVE COVENANTS (Declaration), dated
________________, by Community Home Trust, Inc. of Orange County, NC, Inc. for itself and
its successors and assigns (“Owner”), is given as a condition precedent to the award of Orange
County HOME Investment Partnership Program funds.
RECITALS:
WHEREAS, on May 18, 2018, the Orange County HOME Consortium designated up to
Sixty Thousand Dollars ($60,000) in FY 2018-19 HOME Funds, for the purpose of homebuyer
financial assistance for two (2) families in the Northside and Pine Knolls neighborhood of Chapel
Hill; and
WHEREAS, the County is the lead entity of the Orange County HOME Consortium, so
designated in an agreement dated July 1, 2011 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, CHT submitted a request dated December 10, 2019 for the reallocation of
FY 2018-19 HOME funds to assist in the acquisition of property for resale to a household earning
less than 80% of the HUD area median income; and
WHEREAS, on December 2, 2019 the Orange County Board of County Commissioners
approved the December 10, 2019 request and reallocated $15,000 to CHT for the aforementioned
purpose; and
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WHEREAS, CHT has proposed to utilize the aforementioned funding to support the
acquisition and resale of the property the located at 200 Culbreth Park Drive in Chapel Hill, NC,
hereinafter referred to as the “Property,” and more specifically defined in EXHIBIT A; and
WHEREAS, CHT plans to assist in the resale of the Property to a homebuyer earning less
than 80% of the HUD area median income as described in their Request for HOME funds for 200
Culbreth Park Drive, Chapel Hill, NC 27517, dated December 10, 2019, which request is
incorporated by reference into this Agreement, and hereinafter referred to as the Project. Their
December 10, 2019 request is on file in the office of the Orange County Department of Housing
and Community Development; and
WHEREAS, notwithstanding any provision of this Agreement, the County and the Owner
hereto agree and acknowledge that this Agreement does not constitute a commitment of funds or
site approval, and that such commitment of funds or approval may occur only upon satisfactory
completion of an environmental review and receipt by Orange County of a Release of Funds from
the U.S. Department of Housing and Urban Development under 24 CFR Part §58 if applicable.
The parties further agree that the provision of such funds to the project is conditioned on Orange
County’s determination to proceed with, modify, or cancel the project based on the results of a
subsequent environmental review.
WHEREAS, as particularly described herein, the Property will be held by CHT, ensuring
affordability of the project dwelling unit for at least 99 years; and
WHEREAS, CHT has signed this Declaration agreeing to the terms of this Declaration,
its obligations pursuant to this Declaration and agreeing to the terms of the Development
Agreement between the County and CHT of even date; and
NOW, THEREFORE, in consideration of the mutual covenants, promises, and
representations contained herein, it is agreed between the parties hereto as follows:
SECTION 1 REPRESENTATIONS, COVENANTS AND WARRANTIES OF OWNER
CHT hereby represents, covenants and warrants as follows:
a. Subject to the requirements of the DEVELOPMENT AGREEMENT between CHT and
County dated _______, which is hereby incorporated by reference and made a part of this
Agreement, and this Declaration, CHT may sell, transfer, or exchange the Property to a non-
profit fund, foundation, or corporation of like purpose which is organized and operated
exclusively for charitable and educational purposes and which has established its tax exempt
status under Section 501(c)(3) of the Internal Revenue Code, or to the County, but Owner shall
notify in writing and obtain the agreement of any buyer or successor or other person acquiring
the Property or any interest therein, that such acquisition is subject to the requirements of this
Declaration and to the requirements of the DEVELOPMENT AGREEMENT and the Federal
HOME Investment Partnership Program. CHT agrees that County may void any sale, transfer,
or exchange of the Property or any portion of the Property if the buyer or successor or other
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person fails to assume in writing the requirements of this Declaration and the requirements of
the DEVELOPMENT AGREEMENT.
b. Contemporaneously with the execution, delivery and recording of this Declaration, CHT
will acquire good and marketable title to the Property, free and clear of any lien or encumbrance
(except encumbrances created pursuant to this Declaration or other encumbrances permitted by
Orange County).
c. CHT warrants that it will not accept title to the Property subject to and will not execute any
other declaration with provisions contradictory to, or in opposition to, the provisions hereof, and
that in any event, the requirements of this Declaration are paramount and controlling as to the
rights and obligations herein set forth and supersede any other requirements in conflict herewith.
SECTION 2 TERM OF DECLARATION
a. This Declaration (and the terms of affordability specified herein) applies to the Property
immediately upon the recordation of this Declaration. CHT and all subsequent owners of the
Property shall comply with all covenants herein. This Declaration shall terminate ninety-nine years
after the Project completion date as specified in the DEVELOPMENT AGREEMENT.
SECTION 3 RECORDING AND FILING; COVENANTS TO RUN WITH THE LAND
a. CHT shall cause this declaration and all amendments hereto to be recorded and filed in the
Office of the Register of Deeds of Orange County upon its execution. CHT shall pay all fees and
charges incurred in connection therewith.
b. CHT intends, declares and covenants, on behalf of itself and all future owners of the
Property during the term of this Declaration, that this Declaration and the covenants and
restrictions set forth in this Declaration regulating and restricting the use, occupancy and transfer
of the Property (1) shall be and are covenants running with the land, encumbering the Property for
the term of this Declaration, binding upon all present and future owners of the Property; (2) are
not personal covenants of Declarant; and (3) shall bind all present and future owners (and the
benefits shall inure to the County and any prospective owner of the Property) and its respective
successors and assigns during the term of this Declaration. For the term of this Declaration, each
and every contract, lease, deed or other instrument hereafter executed conveying the Property or
portion thereof shall expressly provide that such conveyance is subject to this Declaration,
provided, however, the covenants contained herein shall survive and be effective regardless of
whether such contract, lease, deed, or other instrument hereafter executed conveying the Property
or portion thereof provides that such conveyance is subject to this Declaration. It is further the
responsibility of CHT to rerecord this Declaration 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.
The County retains the right to, periodically and every 30 years after the first recording of the
Ground Lease created in Attachment B hereof, register, with the Register of Deeds of Orange
County, a notice of preservation of the Restrictive Covenants on the Property as provided in North
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Carolina General Statute § 47B-4 or any comparable preservation law in effect at the time of the
recording of the notice of preservation. It is the intent of this Section 3 of this Declaration that the
99 year duration of this Declaration of Restrictive Covenants be accomplished and that any future
owner of the Property, CHT 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 of the Property, CHT and Orange County will to do
what each must do to accomplish the 99 year duration of this Declaration of Restrictive Covenants.
SECTION 4 ENFORCEMENT OF AFFORDABLE HOUSING REQUIREMENTS
a. At the time of resale of the project dwelling unit, CHT will convey a housing unit to
qualified homebuyer. Each housing unit will consist of a 99 year Ground Lease (renewable for
an additional 99 years) to the project dwelling unit. The Ground Lease, the form of which is
Attachment B hereto, provides for the long term affordability (at least 99 years) of the housing
unit and provides remedies to insure the long term affordability of the housing unit. CHT hereby
declares and covenants, on behalf of itself and all future owners of the Property, that, during the
term of this Declaration, the County is a third party beneficiary of and successor to each and
every remedy intended to insure the long term affordability of the housing unit that is provided
for in the Ground Lease and may, in the event of the failure or default of the Lessor in the
Ground Lease to insure the long term affordability of the housing unit as provided for in the
Ground Lease, exercise all rights and remedies available to the Lessor in the Ground Lease for
that purpose.
b. CHT covenants that it will not knowingly take or permit any action that would result in a
violation of the affordability requirements of the DEVELOPMENT AGREEMENT. Orange
County, together with any future owner of the Property may execute and record any amendment
or modification of this Declaration necessary to insure the successful completion of the Project
and the long term affordability (at least 99 years) of the housing units on the Property and such
amendment or modification shall, to the extent permitted by law, either relate back to the date of
recording of this Declaration or not as necessary to carry out the intent of this Declaration, and
be binding on third parties granted rights under this Declaration. CHT expressly covenants and
agrees to rerecord this Declaration periodically and no less often than one day less than every 30
years from the date hereof for the purpose of renewing the Lessor’s option to purchase and right
of first refusal, that are contained in the Attachment B Ground Lease, in the Property or portion
thereof including any leasehold interest in the Property or portion thereof.
c. CHT acknowledges that the primary purpose for requiring compliance by CHT with
restrictions provided in this Declaration is to assure compliance with the long term affordability
requirements of the HOME INVESTMENT PARTNERSHIP PROGRAM, AND BY REASON
THEREOF, CHT, IN CONSIDERATION FOR RECEIVING HOME INVESTMENT
PARTNERSHIP PROGRAM FUNDS FOR THE PROPERTY, HEREBY AGREES AND
CONSENTS THAT THE COUNTY SHALL BE ENTITLED, FOR ANY BREACH OF THE
PROVISIONS HEREIN, AND IN ADDITION TO ALL OTHER REMEDIES PROVIDED BY
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LAW OR IN EQUITY, TO ENFORCE BY SPECIFIC PERFORMANCE CHT’S
OBLIGATIONS UNDER THIS DECLARATION IN A STATE COURT OF COMPETENT
JURISDICTION, WITH VENUE IN ORANGE COUNTY. CHT hereby further specifically
acknowledges that the beneficiaries of CHT’s obligations hereunder cannot be adequately
compensated by monetary damages in the event of any default hereunder. If legal costs are
incurred by the County, such legal costs, including attorney fees and court costs (including costs
of appeal), are the responsibility of, and may be recovered from the CHT.
SECTION 5 MISCELLANEOUS
a. Severability. The invalidity of any clause, part, or provision of this Declaration shall not
affect the validity of the remaining portions thereof.
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b. 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 herein 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 and Community Development Department
P.O. Box 8181
Hillsborough, NC 27278
ATTN: Director
ii. To Declarant: To CHT:
Community Home Trust
109 Conner Drive, Suite 1000
Chapel Hill, NC 27514
ATTN: Executive Director
c. Governing Law. This Declaration shall be governed by the laws of the State of North
Carolina and, where applicable, the laws of the United States of America.
IN WITNESS WHEREOF, CHT has caused this Declaration to be signed by its duly
authorized representative, on the day and year first above written.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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Community Home Trust, Inc.
By:____________________________________
.LPEHUO\6DQFKH], President
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 _________________ with whom I
am personally acquainted, who, being by me duly sworn, says that he is ____________ of
Community Home Trust, Inc., a North Carolina corporation, and that by authority duly given and
as the act of the corporation, the foregoing instrument was signed by him on behalf of the
corporation.
Witness my hand and notarial seal, this the _________day of _______________, 20___.
_________________________________
Notary Public
My commission expires: ___________________
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ATTACHMENT A
Property Description
PIN: 9787-18-1780
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ATTACHMENT B
Ground Lease
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EXHIBIT E
GROUND LEASE AGREEMENT
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