HomeMy WebLinkAbout2004-09-27 City Council (2)FROM:
City of Palo Alto
C ty Manager’s Report
HONORABLE CITY COUNCIL
CITY MANAGER DEPARTMENT: PLANNING AND
COMMUNITY ENVIRONMENT
DATE:SEPTEMBER 27, 2004 CMR: 404:04
SUBJECT:APPROVAL OF AN AGREEMENT IN THE AMOUNT OF $113,672
WITH PALO ALTO HOUSING CORPORATION AND PAHC
APARTMENTS, INC. FOR FUNDS ALLOCATED DURING FISCAL
YEAR 2003/04 UNDER THE COMMUNITY DEVELOPMENT
BLOCK GRANT PROGRAM (SECOND AGREEMENT)
RECOMMENDATION
Staff recommends that the City Council approve and authorize the City Manager or his
designee to execute the attached second agreement in the amount of $113,672 with Palo
Alto Housing Corporation and PAHC Apartments, Inc. to replace the domestic water
supply system at Oak Manor Townhouses located at 630 Los Robles Avenue.
BACKGROUND
PAHC applied for fiscal year 2003/04 Community Development Block Grant (CDBG)
funding to assist in replacing the water supply system at Oak Manor Townhouses on
behalf of PAHC Apartments, Inc. On May 12, 2003, the City Council approved
allocating $113,672 in fiscal year 2003/04 CDBG funds to the Oak Manor domestic
water system project. The agreement was previously approved by the City Council on
March 22, 2004. However, after City Council approval, some minor errors were
discovered in the agreement.
DISCUSSION
The attached second agreement reflects the changes that were made to the original
agreement. The revisions include changing the name of the entity from Palo Alto
Housing Corporation Apartments, Inc. to PAHC Apartments, Inc. and making changes to
the use, occupancy and rent restrictions to correspond with the restrictions in the original
agreement.
CMR: 404:04 Page 1 of 2
RESOURCE IMPACT
The $113,672 of the agreement will be funded with federal CDBG funds provided
through the U.S. Department of Housing and Urban Development (HUD). Repayment of
the loan will not be required unless the property is sold or the program terminated or
changed to a use that has not been approved by the City prior to July 1, 2033.
POLICY IMPLICATION
The revisions to the original contract do not represent any change to City policies.
ENVIRONMENTAL REVIEW
HUD environmental regulations for the CDBG program is contained in 24 CFR 58
"Environmental Review Procedures for Title I Community Development Block Grant
Programs." The Oak Manor Townhouses domestic water system project meets the
conditions specified for exemption under 24 CFR Part 58.34.
ATTACHMENTS
Attachment A:Agreement Between the City of Palo Alto and Palo Alto Housing
Corporation (PAHC) and PAHC Apartments, Inc. for Funds
Allocated During Fiscal Year 2003/04 Under the Community
Development Block Grant Program (Second Agreement)
PREPARED BY: ~@~~’~’" ~
E~Z~~~~/~ARCIA, Associate Planner-CDBG
APPROVED BY: _/./’][[A ~-/~ ~
ST~fE" ~I~I~LIE, Dir~-~tor of Planni~munity Environment
EMILY HAR~SO~s~-stant ~nager
Cc:Palo Alto Housing Corporation
CMR: 404:04 Page 2 of 2
AGREEMENT BETWEEN THE CITY OF PALO ALTO AND
PALOALTO HOUSING CORPORATION (PAHC)~AND PAHC
APARTMENTS, INC. FOR FUNDS ALLOCATED DURING
FISCAL YEAR 2003/04 UNDER THE COMMUNITY
DEVELOPMENT BLOCK GRANT PROGRAM
(SECOND AGREEMENT)
This Agreement No. is entered into
, 2004, by and between the CITY OF PALO ALTO, a
chartered city and a municipal corporation of the State of
California (~City"), and PALO ALTO HOUSING CORPORATION, a
corporation duly organized and existing under the Nonprofit
Corporation Law of the State of California (~PAHC"), and PAHC
APARTMENTS, INC., a corporation duly organized and existing
under the Nonprofit Corporation Law of the State of California
("PAHCA, INC.").
RECITALS~
WHEREAS, the City has applied for and received funds
("Funds") from the Government of the United States under Title I
of the Housing and Community Development Act of 1974; and
WHEREAS, PAHCA, INC. is a private non-profit
organization which develops and operates low and moderate income
housing in the City; and
WHEREAS, PALO ALTO HOUSING APARTMENT CORPORATION,
INC., is a controlled affiliate of PALO ALTO HOUSING
CORPORATION, with identical boards of directors; and
WHEREAS, PAHC has requested funds to replace the
domestic water supply system at Oak Manor Townhouses (the
"Project") located at 630 Los Robles Avenue, Palo Alto,
California which is owned by its controlled affiliate~ PAHCA,
Inc. but managed by PAHC; and
WHEREAS, City wishes to lend,funds to PAHCA, INC., and
forgive the loan if certain conditions are met by PAHC and
PAHCA, INC., for the purposes set forth in this Agreement, and
any exhibits thereto; and
WHEREAS, City has approved and authorized the
provision of up to One Hundred Thirteen Thousand Six Hundred
Seventy Two Dollars ($i13,672~ drawn from FY 2003/04 CDBG funds
040316 syn 8250088
1
to PAHCA, INC. for the purposes and under the terms contained
herein; and
WHEREAS, the City neither warrants or makes any
representations as to the quality, method or adequacy of the
work products or services to be provided to PAHCA, INC. under
the terms and conditions of this Agreement, except with respect
to compliance with Federal Regulations.
WHEREAS, on May i, 2004, the parties entered into
Agreement No. C04104144 for funds allocated during fiscal year
2003/04 under the Community Development Block Grant Program
(First Agreement). This Second Agreement supersedes the First
Agreement in its entirety.
NOW, THEREFORE, in consideration of the covenants,
terms, conditions, and provisions set forth in this Agreement,
the parties agree:
SECTION i. SECOND AGREEMENT
This Second Agreement supersedes the First Agreement
in its entirety.
SECTION 2. TERM
2.1 Time of Performance. This Agreement shall
commence on the day above written and terminate on December 31,
2033. The term of this agreement and the provisions herein
shall be extended to cover any additional time period during
which the PAHCA, INC. remains in control of Funds or other
assets including program income.
SECTION 3.SCOPE OF SERVICE
3.1 Activities.PAHCA, INC. shall replace the
domestic water supply system at Oak Manor Townhouses at 630 Los
Robles Avenue, in Palo Alto ("Project"), as more fully described
in Exhibit ~A" which is incorporated herein by reference and
made a part of this agreement.
3.2 Provision of Funds. The City agrees to make a
loan to PAHCA, INC. of the principal amount of One Hundred
Thirteen Thousand Six Hundred Seventy-Two Dollars ($113,672)
drawn from its CDBG funds for Phase I of the Oak Manor
Townhouses Domestic Water System project as shown on the
attached scope of services ("Exhibit A"). Phase I shall include
the replacement of water mains from meter with the 2-1/2" RPP
040316 syn 8250088
device, tie into all branch lines below plumbing with isolation
ball valves, two branch lines for every two units°
The city shall not provide any funding for Phase II
costs which shall include the plumbing of internal units (total
of 33) from new branch lines to all fixtures as per
specifications. Repair sheetrock to paint-ready surface.
PAHC agrees to perform construction management
services for Phase I and Phase II of the project, including
coordinating the work of the construction contractors at no
cost. In the event that the amounts payable by PAHCA, .INC., to
any and all sources for the Project-Phase I costs shall exceed
the sum $113,672, then PAHCA, INC. shall be solely responsible
for paying any and all amounts in excess of $113,672 and the
City shall not be obligated to loan any amount in excess of the
commitment set forth herein. City shall make funds available to
PAHCA on the following basis:
(i)
(2)
City has reviewed and approved the bidding
process and the contract for the rehabilitation .
work; and
PAHCA, INC. has provided City with a copy of the
actual invoice(s) for work done and performed in
accordance with this Agreement;
(3)Project is in compliance with all Federal, State
and City Rules and Regulations.
3.3 Performance Monitoring.The City will ~monitor
the performance of PAHC and PAHCA,INC. against~ goals and
performance standards required herein.CITY will retain a
consultant who will monitor labor to be performed pursuant to
this Agreement according to Davis-Bacon Act standards
(~Consultant") CITY will be responsible for directing all work
to be performed by Consultant, and Consultant will report
directly to CITY. PAHCA, INC. agrees that CITY shall charge the
cost of the Labor Monitoring Consultant against the project
funds. .Total cost for such labor monitoring services will not
exceed Ten Thousand Dollars ($i0,000) and will be paid from the
project funds. Any unexpended funds, after payment of all labor
monitoring costs, may be used by PAHCA, INC. for project
construction costs for Phase I, only. Substandard performance
as determined by the City will constitute non-compliance with
this Agreement. If action to correct such substandard
performance is not taken by PAHC and PAHCA, INC. within a
040316 syn 8250088
reasonable period, of time after being notified by the City,
contract suspension or termination procedures will be initiated.
SECTION 4. TRANSFER OF FUNDS AND SECURITY
4.1. City Loan. City shall pay to PAHCA, INC. a sum
of money in an amount not to exceed One Hundred Thirteen
Thousand Six Hundred Seventy Two Dollars ($113,672) for the
purposes set forth in Section 3 and Exhibit ~A". Payment of
such sum shall be evidenced by a promissory note (~Note"), in
the form attached hereto as Exhibit ~B" and incorporated herein
by this reference. The entire sum transferred, and any part of
it, shall, at the option of City, become immediately due and
payable upon the occurrence of any of the following conditions:
(i)The failure by PAHC and PAHCA, INC. to commence
and complete the Project services set forth in
this Agreement before the termination date of
June 30, 2005;
(2)PAHC’s and PAHCA, INC.’s breach in performance of
the Project or any of the terms of this agreement
between City and PAHCA, INC.;
(3)A use by PAHCA, INC. of the Project, prior to
October i, 2033, which violates the applicable
provisions of City’s Charter, ordinances, or
regulations, or which is not an ~eligible
activity" under the Program of the Housing and
Community Development Acts of 1974 and 1977, as
amended, and the regulations issued pursuant
thereto, by HUD or a successor agency; or
(4)An uncured default under this Agreement or the
Note.
This shall be a simple interest, noncompounding loan
with interest at three percent (3%) per annum. It is agreed
that the loan shall be payable in monthly installments over ten
(i0) years. However, all payments of interest and principal
shall be deferred until October i, 2023, as long as PAHC and
PAHCA, INC. continue to comply with all terms and conditions of
this Agreement. If at any time any of the above conditions are
not met, City has the right to demand repayment of the One
Hundred Thirteen Thousand Six Hundred Seventy-Two Dollars
($113,672), plus all accrued interest and any other costs or
amounts due.
040316 syn 8250088
4
4.2 Use, Occupancy and Rent Restrictions.
PAHCA, Inc. shall operate and maintain the Project as
a 9ental housing complex for occupancy by Very Low Income
Households and Low-Income Households. Without derogating the
importance of PAHCA, Inc.’s compliance with the other provisions
of this Agreement, PAHCA, Inc.’s compliance with Section 4.2 is
of particular importance to City and is one of the principal
reasons for which City agreed to make the Project loan to PAHCA,
Inc.
4.2.1 Very Low-Income Units
(a)At all times during the term of this Agreement,
at least seventeen (17) of the Units shall be
rented and occupied by, Or if vacant, made
available for rental and occupancy by, Very Low-
Income households, as certified according to
Section 4.3 immediately prior to each Tenant’s
initial occupancy and annually thereafter~ Very-
Low Income means a household whose annual income,
adjusted for household size, does not exceed the
Very-Low limit as published annually for Santa
Clara County by the California Tax Credit-
Allocation Committee (CTCAC).
(b)Subject to Section 4.3 below, the maximum monthly
Rent charged to each of the Tenants of the Very.
Low-Income Units shall not exceed 50% of the
average rent for the 100% Area Median Income
level, as published annually for the Santa Clara
County based on the size of the actual unit.
The current maximum rents for 2 and 3 bedroom
units are listed in the following table:
CALIFORNIA TAX CREDIT ALLOCATION COMMITTEE
2004 Maximum Rents
Santa Clara County
Effective:February 9, 2004
2 Bedroom 3 Bedroom
100% Income Level $2,386 $2,758
50% Income Level $1,193 $1,379
040316 syn 8250088
(c)Owner may designate any seventeen (17) of the
Project’s thirty-three (33) Units as the required
Very Low-Income Units and may change the
designated Very Low-Income Units from time to
time, as vacancies occur and Tenant incomes and
household composition changes.
(d)If a household ceases to qualify as Very Low
Income, as required by this Agreement, the
household may be included in the Low Income
category, if they do not exceed the Low Income
limits. If a household’s status changes from
Very Low Income to Low Income, the next vacancy
shall be filled by a Very Low Income household to
restore the unit balance.
4.2.2 Low-Income Units
(a)At all times during the term of this Agreement,
not more than fifteen (15) of the Units shall be
rented and occupied by, or if vacant, made
available for renta! and occupancy by, Low-Income
households, as certified according to Section 3.3
immediately prior to each Tenant’s initial
occupancy and annually thereafter. Low Income for
the purposes of this agreement means a household
whose annual income, adjusted for household size,
does not exceed 66% (sixty-six percent) of the
Area Median Income for Santa Clara County.
(b)Subject to Section 4.3 below, the maximum monthly
Rent charged to each of the Tenants of the Very
Low’Income Units shall not exceed 66% (sixty-six
percent) of the average rent for the 100% (one-
hundred percent) Income Level, as published
annually for Santa Clara County by the California
Tax Credit Allocation Committee (CTAC) based on
the size of the actual unit. The current CTAC
maximum rents for 2 and 3 bedroom units are
listed in the following table:
CALIFORNIA TAX CREDIT ALLOCATION COMI~ITTEE
2004 Maximum Rents
Santa Clara County
Effective: February9, 2004
2 Bedroom
100% Income Level $2,386
66% Income Level $1,575
3 Bedroom
$2,758
$1,820
040316 syn 8250088
6
(c)A household will cease to qualify for tenancy if
their income exceeds 140% of the highest income
eligible upon entering the unit. Upon exceeding
the 140% threshold, the household will be given
90 days to vacate the unit.
4.2.3 Other Units
(a)The remaining one (i) Unit is not required to
comply with the rent and occupancy restrictions
of this Section 4.2 if it is occupied by a
resident manager, as a condition of. employment.
4.2.4 Units Occupied by Section 8 Assisted
Households
Units occupied by Section 8 Assisted Households shall
be considered to be qualified Very Low or Low-Income Units based
on each household’s annual income as certified pursuant to
regulations and procedures of the Section 8 Assistance Program.
Notwithstanding anything to the contrary contained.in Section
3.2.1 or 3.2.2, the Rent for Units occupied by Section 8
Assisted Households shall be set pursuant to Section 8
regulations and procedures.
4.2.5 Vacancies
Vacancies shall be filled in a manner to maintain the
allocation of units as described in this Agreement.’ Seventeen
(17) units shall .be maintained for Very Low Income households;
fifteen (15) units shall be maintained by Low Income Households;
and one (i) unit shall be maintained for a resident manager.
4.2.6 Noncompliance
A failure by PAHCA, Inc to maintain the rent
affordability and occupancy restrictions required by this
Agreement will constitute a default of this Agreement. The
Project will comply with the affordability covenants,
notwithstanding a temporary noncompliance with the provisions of
this Article, if the noncompliance arises as a result of an
increase in the income of any Tenant, and if the next vacancy is
filled in accordance with this Agreement.
040316 syn 8250088
4.2.7 Lease Provisions
PAHCA, Inc. shall include in the leases or rental
agreements for all Units occupied by Very Low Income or Low
Income Households a provision which authorizes PAHCA, Inc. to
immediately terminate the tenancy of any Tenant after PAHCA,
Inc. determines that one or more members of such Tenant’s
household has misrepresented any fact material to the Tenant’s
qualification for occupancy. Each lease or rental agreement
shall provide that the Tenant is subject to the requirement for
the execution of an annual income certification in accordance
with Section 3.3 below, and that, if the Tenant’s income
increases above the applicable income limits, such Tenant’s Rent
may be increased.
4.3 Income Certification
PAHCA, Inc. will obtain, complete and maintain on
file, immediately prior to initial occupancy and annually
thereafter, an income certification from each Tenant renting any
of the Very Low-Income and Low-Income Units. PAHCA, Inc. shall
make a good faith effort to verify that the income provided by
an applicant or occupying household, in an income certification.
is accurate in accordance with the CDBG Regulations. Copies of
tenant income certifications shall be made available to the
City, including its designated representatives= and HUD upon
request.
SECTION 5.NOTICES
5.1 Communications. All notices, correspondence, and
other communications concerning this Agreement shall be directed
to the parties’ duly authorized representatives at the addresses
set forth below or at any other addresses as may be noticed, in
writing:
CITY:City of Palo Alto
Department of Planning &
Community Environment
Attn: CDBG Coordinator
250 Hamilton Avenue
Palo Alto, CA 94301
PAHCA, INC.PAHC Apartments, Inc.
Attn: President, Board of Directors
725 Alma Street
Palo Alto, CA 94301
040316 syn 8250088
and
PAHC :Palo Alto Housing Corporation
Attn: Executive Director
725 Alma Street
Palo Alto, CA 94301
SECTION 6. SPECIAL CONDITIONS
6.1 Compliance with Federal Regulations. PAHC and
PAHCA, INC. agree to comply with the requirements of the Housing
and Urban Development regulations concerning Community
Development Block Grants (24 CFR Part 570) and all federal
regulations and policies issued pursuant to these Regulations.
PAHCA, INC. further agrees to utilize Funds available under this
Agreement to supplement rather than supplant Funds otherwise
available.
6.2. National Objectives.PAHC and PAHCA, INC.
certify that the activities carried out with funds provided
under this Agreement will meet the CDBG Program’s National
Objective of benefiting low/moderate income persons as defined
in 24 CFR, Part 570.208.
6.3 PAHC and PAHCA, INC. shall procure all
subcontractors, consistent with Federal . procurement
requirements. All bid documents must be reviewed and approved
by the City or its designee before being made available to the
public. PAHCA, INC. shall sign a written agreement(s) with
selected subcontractor(s), and shall direct,manage and
reimburse all project subcontractors.
SECTION ~7.GENERAL CONDITIONS
7.1 General Compliance. PAHC and PAHCA, INC. agree
to comply with all applicable federal, state, county,and
municipal laws, ordinances, resolutions, rules, policies,and
regulations ("Laws") governing the Funds provided underthis
Agreement.
7.2 Independent Contractor. Nothing contained in
this Agreement is intended to, or shall be construed in any
manner, as creating or establishing the relationship of .employer
and employee between the parties. PAHC and PAHCA, INC. shall at
all times remain independent contractors with respect to the
services to be performed under this Agreement. The City shall
be exempt from payment of all unemployment compensation, FICA,
040316 syn 8250088
retirement, life and/or medical insurance and workers’
compensation insurance as PAHC and PAHCA, INC. is an independent
contractor.
7.3 Hold Harmless. PAHC and PAHCA, INC. shall hold
harmless, defend and indemnify the City, its council members,
officers and employees from any and all claims, actions, suits,
charges and judgments whatsoever that arise out of PAHC’s and
PAHCA, INC.’s performance or nonperformance of the Services or
subject matter called for in this Agreement.
7.4 Insurance and Bonding. PAHCA, INC., at its sole
cost and expense, shall obtain and maintain during the term of
this Agreement, insurance as more fully described in Exhibit "C"
which is incorporated herein by reference and made a part of
this Agreement. PAHCA, INC. shall comply with the bonding and
insurance requirements of Attachment B of OMB Circular A-II0,
Bonding and Insurance.
7.5 Funding Recognition. PAHC and PAHCA, INC. shall
ensure recognition of the role of the City in providing services
through this Agreement. All activities, facilities and items
utilized pursuant to this Agreement shall be prominently labeled
as to funding source. In addition, PAHC and PAHCA, INC. will
include a reference to the support provided herein in all
publications made possible with Funds made available under this
Agreement.
7.6 Amendments. The parties may amend this Agreement
at any time provided that such amendments make specific
reference to this Agreement, and are executed in writing, and
signed by their duly authorized representatives. Such
amendments shall not invalidate this Agreement, nor relieve or
release any party from its obligations under this Agreement. At
any time during the term of this Agreement, the City, in its
discretion, may amend this Agreement to conform with federal,
state or local governmental guidelines, policies and available
funding amounts, or for any other reasons. If such amendments
result in a change in the funding, the scope of Services, or
schedule of, the activities to be undertaken as part of this
Agreement, such modifications will be incorporated only by
written amendment signed by the parties.
7.7 Suspension or Termination.
7.7.1 Either party may terminate this Agreement at
any time by giving written notice to the other party of such
termination and specifying the effective date thereof at least
040316 syn 8250088
10
30 days before .the effective date of such termination. If
PAHCA, INC. terminates the Agreement, all sums transferred to
PAHCA, INC. pursuant to this Agreement and the Note shall become
immediately due and payable to City. Partial termination of the
Scope of Services described in Exhibit ~A" may only be
undertaken with the prior approval of the CITY.
7.7.2 The CITY may also suspend or terminate this
Agreement, in whole or in part, if PAHC and PAHCA, INC.
materially fail to comply with any covenant, term, condition, or
provision of this Agreement, or with any of the rules,
regulations or provision referred to herein; and the CITY may
declare PAHC and PAHCA, INC. ineligible for any further
participation in CITY contracts, in addition to other remedies
as provided by Law. In the event ther4 is probable cause to
believe PAHC and PAHCA, INC. are in noncompliance with any
applicable rules or regulations, the CITY may withhold up to
fifteen percent (15%) of the Funds until such time as PAHC and
PAHCA, INC. are found to be in compliance by the City, or are
otherwise adjudicated to be in compliance.
SECTION 8.ADMINISTRATIVE REQUIREMENTS
8.1 Financial Management.
8.1.1 Accounting Standards. PAHC and PAHCA, INC.
agree to comply with Attachment F of OMB Circular A-II0 and
agree to adhere to the accounting principles and procedures
required therein, utilize adequate internal controls and
maintain necessary source documentation for all costs incurred.
8.1.2 Cost Principles. PAHC and PAHCA, INC. shall
administer its program in conformance with OMB Circulars A-122,
~Cost Principles for Non-Profit Organizations," or A-21, "Cost
Principles for Educational Institutions," as applicable. These
principles shall be applied for all costs incurred whether
charged on a direct or indirect basis.
8.2 Documentation and Record-Keeping.
8.2.1 Records to be Maintained. PAHC and PAHCA, INC.
shall maintain all records required by the federal regulations
specified in 24 CFR Section 570.506, and that are pertinent to
the activities to be funded under this Agreement. Such records
shall include, but are not limited to:
(a)Records providing a
activity undertaken;
full description of each
040316 syn 8250088
11
(b)
(c)
Records demonstrating that each activity
undertaken meets a National Objective of the CDBG
Program;
Records required to determine the eligibility of
activities;
(d)Records required to document the acquisition,
improvement, use or disposition of real property
acquired or improved with CDBG assistance;
(e)Records documenting compliance with the fair
housing and equal opportunity component of the
CDBG Program;
(f)Financial records as required by 24 CFR Section
570.502, and OMB Circular A-II0; and
(g)Other records necessary to document compliance
with Subpart K of 24 CFR Part 570.
8.2.2 Retention. PAHC and PAHCA, INC. shall retain
all records pertinent to expenditures incurred under this
Agreement for a period of four (4) years after the termination
of all activities funded under this Agreement, or after the
resolution of all federal audit findings, whichever occurs
later. Records for non-expendable property acquired with Funds
under this Agreement shall be retained for four (4) years after
final disposition of such property. Records for any displaced
person must be kept for four (4) years after he or she has
received final payment. Notwithstanding the above, if there is
litigation, claims’, audits, negotiations or other actions that
involve any of the records cited and that have started before
the expiration of the four-year period, then such records must
be retained until completion of the actions and resolution of
all issues, or the expiration of the four-year period, whichever
occurs later.
8.2.3 Client Data.PAHC and PAHCA, INC. shall
maintain confidential records of client data demonstrating
client eligibility for services.Such data shall include, but
not be limited to, client name,address, income level or other
basis for determining eligibility, and ethnicity. Such
information shall be made available to the City’s monitors or
their designees for review upon request in order to determine
compliance with the Agreement.
040316 syn 8250088
12
8.2.4 Disclosure. PAHC and PAHCA, INC. understand
that client information collected under this Agreement is
private and the use or disclosure of such information, when not
directly connected with the administration of the City’s or
PAHC’s and PAHCA, INC.’s responsibilities with respect to
Services provided under this Agreement, is prohibited by the
laws of the State of California, unless written consent is
obtained from such person receiving the service and, in the case
of a minor, that of a responsible parent or guardian.
8.2.5 Property Records. PAHC and PAHCA, INC. shall
maintain real property inventory records which clearly identify
properties purchased, improved or sold. Properties retained
shall continue to meet eligibility criteria and shall conform
with the ~changes in use" restrictions specified in 24 CFR
Section 570.503(b) (8), as applicable.
8.2.6 National Objectives. PAHC and PAHCA, INC.
agree to maintain documentation that demonstrates that the
activities carried out with Funds provided under this Agreement
meet the CDBG Program’s national objective of benefiting low
and moderate income persons, as defined in 24 CFR Section
570.208.
8.2.7 Close-Outs. PAHC’s and PAHCA, INC.’s
obligation to the City shall not end until all close-out
requirements are completed. Activities during this close-out
period shall include, but are not limited to, making final
payments, disposing of CDBG Program assets (including the return
of all unused materials, equipment, unspent cash advances,
program income balances, and receivable accounts to the City),
and determining the custodianship of records.
8.2.8 Audits and Inspections. All of the PAHC’s and
PAHCA, INC.’s records with respect to any matters covered by
this Agreement shall be made available to the City, grantor
agency, their designees or the Government of the United States,
at any time during normal business hours, as often as the City
or grantor agency deems necessary, to audit, examine, and make
excerpts or transcripts of all relevant data. Any deficiencies
noted in audit reports must be fully cleared by the PAHC and
PAHCA, INC. within 30 days after receipt by the PAHC and PAHCA,
INC.. Failure of the PAHC and PAHCA, INC. to comply with the
above audit requirements will constitute a violation of this
Agreement and may result in the withholding of future payments.
PAHC and PAHCA, INC. agree to have an annual agency audit
conducted in accordance with current City policy concerning the
040316 syn 8250088
13
PAHC’s and PAHCA, INC.’s audits, and as applicable, OMB Circular
A-133.
8.3 Procedures Concerning Reporting and Payments°
8.3.1 Budgets. PAHC and PAHCA, INC. shall submit a
detailed budget of a form and content prescribed by the City for
its approval. The parties may agree to revise the budget from
time to time in accordance with existing City policies.
8.3.2 Program Income. Any income or earnings
received by BORROWER which are directly generated from the use
of Community Development Block Grant funds hereinafter "Program
Income" shall be reported by BORROWER to City on a quarterly
basis. All Program Income shall: (i) be used solely to offset
the operating expenses of the activities funded under this
Agreement; (2) be subject to all the provisions of this
Agreement; and (3) be expended prior to submission of a Request
for Reimbursement. Any Program Income on hand when this
Agreement expires or terminates or any Program Income received
after this Agreement expires or terminates, shall be promptly
paid to CITY. CITY may, at its option, require remittance of
Program Income cash balances at the end of each fiscal year.
a. All rents or other payment collected from project
tenants during the term of this Agreement shall be used by
BORROWER solely to further project activities.
b. Rents or other income collected which remains
unspent at the end of the term of this Agreement shall be used
by BORROWER solely to further project activities or shall be
reimbursed to CITY.
c. Rents or other income received after the term of
this Agreement shall not be subject to this Agreement.
8.3.3 Reversion of Assets. Upon the expiration of
this Agreement, Borrower shall transfer to CITY and CDBG Funds
on hand at the time of expiration and any accounts receivable
attributable to the use of CDBG Funds, except as allowed under
Section 15, Program Income. Any real estate property under
BORROWER’S control that was acquired or improved in whole or in
part with CDBG Funds in excess of Twenty-Five Thousand Dollars
($25,000) must either be used to meet one of the national
objectives in 570.208 for a period of five years or be disposed
of in a manner that results in the CITY being reimbursed in the
amount of the current fair market value of the property less any
040316 syn 8250088
14
portion of the value attributable to expenditures of non-CDBG
funds for acquisition of, or improvement to, the property.
8.3.4 Indirect Costs. If indirect costs are chargedl
PAHC and PAHCA, INC. shall develop an indirect cost allocation
plan for determining the appropriate City share of
administrative costs and shall submit such plan to the City for
approval, in a form specified by the City.
8.3.5 Payment Procedures. The City will pay to
PAHCA, INC. funds available under this Agreement based upon
information submitted by the PAHCA, INC. and consistent with any
approved budget and City policy concerning payments. With the
exception of certain advances, payments will ~be made for
eligible expenses actually incurred by PAHCA, INC., and not to
exceed actua! cash requirements. Payments will be adjusted by
the City in accordance with advance fund and program income
balances available in the PAHCA, INC. accounts. The City shall
withhold ten percent (10%) of funds from each reimbursement
request from PAHC, Inc. The ten percent (10%) of withheld funds
shall be released at the completion of the pro3ect and when
PAHCA, Inc. has demonstrated to the City that all CDBG
requirements, which include but are not limited to: prevailing
wages and labor standards and equal opportunity requirements,
which include but are not limited to prevailing wages and labor
standards and equal opportunity requirements have been met. In
addition, the City reserves the right to liquidate Funds
available under this Agreement for costs incurred by the City on-
behalf of PAHCA, INC.
8.3.6 Progress Reports. PAHC and PAHCA, INC. shall be
responsible for filing periodic reports, including but not
limited to monthly activity reports and weekly certif’ied wage
payment reports which evaluate the manner in which the project
is achieving its goals and objectives according to standards
established by City. The report shall be on forms approved by
City and shall be filed within five (5) days of the request by
the City.
8.4 Procurement.
8.4.1 Compliance. PAHC and PAHCA, INC. shall comply
with current City policy concerning the purchase of equipment
and shall maintain inventory records of all non-expendable
personal property as defined by such policy as may be procured
with Funds provided herein. All program assets, including,
without limitation, unexpended program income, property, and
040316 syn 8250088
15
equipment, shall revert to the City upon termination of this
Agreement. .
8.4.2 OMB Standards. PAHC and PAHCA, INC. shall
procure materials in accordance with the requirements of
Attachment 0 of OMB Circular A-II0, Procurement Standards, and
shall subsequently follow Attachment N of OMB Circular A-II0,
Property Management Standards, as modified by 24 CFR
470.502(b) (6) covering utilization and disposal of property.
8.4.3 Travel. PAHC and PAHCA, INC. shall obtain
written approval from the City for any travel outside the
metropolitan area with Funds provided under this Agreement.
8.4.4 Relocation. PAHC and PAHCA, INC. agree to
comply with (a) the Uniform Relocation Assistance and Real
Property Acquisition Policies Act of 1970, as amended (URA), and
implementing regulations at 49 CFR Part 24 and 24 CFR
570.606(b); (b) the requirements of 24 CFR 570.606(c) governing
the Residential Antidisplacement and Relocation Assistance Plan
under section 104(d) of the HCD Act; and (c) the requirements in
CFR 570.606(d) governing optional relocation policies. PAHCA,
INC. shall provide relocation assistance to persons (families,
individuals, businesses, nonprofit organizations and farms) that
are displaced as a direct result of acquisition, rehabilitation,
demolition or conversion for a CDBG-assisted project. PAHC and
PAHCA, INC. also agrees to comply with applicable City
ordinances, resolutions and policies concerning the displacement
of persons from their residences.
SECTION 9. PERSONNELAND PARTICIPANT CONDITIONS
9.1 Civil Rights.
9.1.1 Compliance.PAHC and PAHCA, INC. agree to
comply with all federal, state, and local laws, including,
without limitation, Title VI of the Civil Rights Act of 1964, as
amended, Title VIII of the Civil Rights Act of 1968, as amended,
Section 104(b) and Section 109 of Title I of the Housing and
Community Development Act of 1974, as amended, Section 504 of
the Rehabilitation Act of 1973, the Americans with Disabilities
Act of 1990, the Age Discrimination Act of 1975, Executive Order
11063, and Executive Order 11246, as amended by Executive Orders
11375 and 12086.
9.1.2 Nondiscrimination. PAHC and PAHCA, INC. will
not discriminate against any employee or applicant for
employment because of race, skin color, gender, age, religion,
040316 syn 8250088
16
disability, national origin, ancestry, sexual orientation,
housing status, marital status, familial status, weight or
height of such person° PAHC and PAHCA, INC. will take
affirmative action to ensure that all employment practices are
free from such discrimination and in compliance with all
Federal, State and local directives and executive orders
regarding nondiscrimination in employment. Such employment
practices include, but are not limited to the following:
hiring, upgrading, demotion,transfer, recruitment or
recruitment advertising, layoff,termination, rates of pay or
other forms of compensation,and selection for training,
including apprenticeship. PAHC and PAHCA, INC. agree to post in
conspicuous places, available to employees and applicants for
employment, notices to be provided by the contracting agency
setting forth the provision of this nondiscrimination clause.
9.1.3 Land Covenants. This Agreement is subject to
the requirements of Title VI of the Civil Rights Act of 1964, as
amended, and 24 CFR Part 570.601 and 602. In regard to the
sale, lease, or other transfer of land acquired, cleared or
improved with assistance provided under this Agreement, PAHC and
PAHCA, INC. shall cause or require a covenant running with the
land to be inserted in the deed or lease for such transfer,
prohibiting discrimination as herein defined, in the sale, lease
or rental, or in the use or occupancy of such land, or in any
improvements erected or to be erected thereon, providing that
the City and the United States are beneficlaries of and entitled
to enforce such covenants. PAHC and PAHCA, INC., in undertaking
their obligation to carry out the CDBG Program assisted
hereunder, agree to take such measures as are necessary to
enforce such covenant, and will not themselves so ~discriminate.
9.1.4 Section 504. PAHC and PAHCA, INC. agree to
comply with any federal regulations issued pursuant to and in
compliance with Section 504 of the Rehabilitation Act of 1973
(29 U.S.C. 706), as amended, which prohibit discrimination
against the disabled in any federally assisted program. The
City shall provide PAHC and PAHCA, INC. with any guidelines
necessary for compliance with that portion of the regulations in
force during the term of this Agreement.
9.2 Affirmative Action.
9.2.1 Compliance With California Constitution.
Article I Section 31 of the California Constitution, adopted by.
the People of the State of California as Proposition 209
1996, prohibits the City from discrimination or the grant of
preferential treatment on the basis of race, sex, color,
040316 syn 8250088
17
ethnicity or national origin in public employment, public
education, and public contracting. Article I, Section 31 (e)
provides that nothing in Section 31 shall be interpreted as
prohibiting actions which must be taken to establish or maintain
eligibility for any federal program where ineligibility would
result in a loss of federal funds to the City. The provisions
of this Section 9.2 are those necessary to establish and
maintain eligibility for federal funds. At such time as any
provision of this Section 9.2 is not required to establish and
maintain such eligibility, that provision shall be waived by
City. If PAHC and PAHCA, INC. believe any provision of this
Section 9.2 should be waived under this Section 9.2.1, PAHC and
PAHCA, INC. shall provide notice to City in writing, identifying
the provision for which a waiver is sought and the legal basis
for the waiver. City shall respond to the request for waiver
within thirty days after notice is received.
9.2.2 Approved Plan. The PAHCA, INC. agrees that it
shall be committed to carry out pursuant to the City’s
specifications an affirmative action program in keeping with the
principles as provided in Executive Order 11246 (September 24,
1965). The City shall provide affirmative action guidelines to
PAHC and PAHCA, INC. to assist in the formulation of such
program. PAHC and PAHCA, INC. shall submit a plan for an
affirmative action program for approval prior to the award of
Funds.
9.2.3 Women and Minority Business Enterprises. PAHC
and PAHCA, INC. will use their best efforts to afford minority
and women-owned business enterprises the maximum practicable
opportunity participate in the performance of this Agreement.
As used in this.~ Agreement, the term ~minority and female
business enterprise" means a business at least fifty-one percent
(51%) owned and controlled by minority group members or women.
For the purpose of this definition, "minority group members" are
Afro-Americans, Spanish-speaking, Spanish surname or Spanish-
heritage Americans, Asian-Americans, and American Indians. PAHC
and PAHCA, INC. may rely on written representations by
businesses regarding their status as minority and female
business enterprises in lieu of an independent investigation.
9.2.4 Access to Records. PAHC and PAHCA, INC. shall
furnish and cause each of its contractors or subcontractors to
furnish all information and reports required hereunder and will
permit access to its books, records and accounts by the City,
HUD or its agent, or other authorized federal officials for
purposes of investigation to ascertain compliance with rules,
regulations and provisions stated herein.
040316 syn 8250088
18
9.2.5 Notifications. PAHC and PAHCA> INC. will send
to each labor union or representative of workers with which it
may’have a collective bargaining agreement or other contract or
understanding, a notice, to be provided by the agency
contracting officer, advising the labor union or worker’s
representative of PAHC and PAHCA, INC.’s commitments hereunder,
and shall post copies of the notice in conspicuous places
available to employees and applicants for employment.
9.2.6 EEO/AA Statement. PAHC and PAHCA, INC. will,
in all solicitations or advertisements for employees placed by
or on behalf of PAHC and PAHCA, INC., state that they are an
Equal Opportunity or Affirmative Action Employers.
9.2.7 Subcontract Provisions. PAHC and PAHCA, INC.
will include the provisions of Sections 8.1 and 8.2 in every
subcontract or purchase order, specifically or by reference, so
that such provisions will be binding upon each contractor or
subcontractor or vendor.
9.3 Employment Restrictions.
9.3.1 Prohibited Activity. PAHC and PAHCA, INC. are
prohibited from using Funds provided herein or personnel
employed in the administration of the CDBG Program for political
activities, sectarian or religious activities, or lobbying,
political patronage, and nepotism activities.
9.3.2 Labor Standards. PAHC and PAHCA, INC. agree to
comply with the requirements of the Secretary of Labor in
accordance with the Davis-Bacon Act, as amended, the provisions
of Contract Work Hours, the Safety Standards Act, the Copeland
"Anti-Kickback" Act (40 U.S.C. 276a-276a-5; 40 U.S.C. 327 and 40
U.S.C. 276c and all other applicable Laws pertaining to labor
standards insofar as those acts apply to the performance of this
Agreement. PAHC and PAHCA, INC. shall maintain documentation
which demonstrates compliance with the hour and age requirements
of this part. Such documentation shall be made available to the
City for review upon request.
PAHC and PAHCA, INC. agree that, except with respect
to the rehabilitation or construction of residential property
containing less than eight (8) units, all contractors engaged
under contracts in excess of $2,000 for construction, renovation
or repair of any building or work financed, in whole or in part,
with assistance provided under this Agreement, shall comply with
the federal requirements adopted by the City pertaining to such
040316 syn 8250088
19
contracts and with the applicable requirements of the
regulations of the Department of Labor, under 29 CFR Parts i,
3, 5 and 7 governing the payment of wages and ratio of
apprentices and trainees to journeymen; provided, that if wage
rates higher than those required under the regulations are
imposed by state or local laws, nothing hereunder is intended to
relieve PAHC and PAHCA, INC. of their obligation, if any, to
require payment of the higher wage. PAHC and PAHCA, INC. shall
cause or require to be inserted in full, in all such contracts
subject to such regulations, provisions meeting the requirements
of this paragraph.
9.3.3 ~Section 3" Clause.
(a)Compliance with the provisions of "Section 3"
regulations set forth in 24 CFR Part 135, and all
applicable rules and orders issued hereunder
prior to the execution of this Agreement, shall
be a condition of the federal financial
assistance provided under this Agreement and
binding upon the City, PAHC and PAHCA, INC. and
any contractor or subcontractor. Failure to
fulfill these requirements shall subject the
City, the PAHCA, INC. and any contractor or
subcontractor, their successors and assigns, to
those sanctions specified by the agreement
through which federal assistance is provided.
PAHC and PAHCA, INC. certify and agree that no
contractual or other disability exists which
would prevent compliance with these requirements.
PAHC and PAHCA, INC. further agrees to comply
with these ~Section 3" requirements and to
include the following language in all
subcontracts executed under this Agreement:
~The work to be performed under this agreement is
a project assisted under a program providing
direct federal financial assistance from HUD and
is subject to the requirements of Section 3 of
the Housing and Urban Development Act of 1968, as
amended, 12 U.S.C. 1701. "Section 3" requires
that to the greatest extent feasible
opportunities for training and employment be
given to low and very low income residents of the
project area and contracts for work in connection
with the project be awarded to business concerns
that provide economic opportunities for low and
040316 syn 8250088
2O
(b
very low income persons residing in the
metropolitan area in which the project is
located."
PAHC and PAHCA, INC. further agree to ensure that
opportunities for training and employment arising
in connection with a housing rehabilitation
(including reduction and abatement of lead-based
paint hazards), housing construction, or other
public construction project are given to low and
very low income persons residing within the
metropolitan area in which the CDBG-funded
project is located; where feasible, priority
should be given to low and very low income
persons within the service area of the project or
the neighborhood in which the project is located,
and to low and very low income participants in
other HUD programs; and award contracts for work
undertaken in connection with a housing
rehabilitation (including reduction and abatement
of lead-based paint hazards), housing
construction, or other public construction
project are given to business concerns that
provide economic opportunities for low and very
low income persons residing within the
metropolitan area in which the CDBG-funded
project is located; where feasible priority
should be given to business concerns which
provide economic opportunities to low and very
low income residents within the service area of
the neighborhood in which the project is located,
and to low and very low income participants in
other HUD programs.
PAHC and PAHCA, INC. certify and agree that no
contractual or other legal incapacity exists
which would prevent compliance with these
requirements.
PAHC and PAHCA, INC. agree to send to each labor
organization or ~epresentative of workers with
which it has a collective agreement or other
contract or understanding, if any, a ~notice
advising the labor organization or worker’s
representative of its commitments under this
~Section 3" clause and shall post copies of the
notice in conspicuous places available employees
and applicants for employment or training.
040316 syn 8250088
21
(c)PAHc and PAHCA, INC. will include this ~Section
3" clause in every subcontract and will take
appropriate action pursuant to the subcontract
upon a finding that the contractor or
subcontractor is in violation of regulations
issued by the grantor agency.PAHC and PAHCA,
INC. will not subcontract with any contractor or
subcontractor where it has notice or knowledge
that the latter has been found in violation of
regulations under 24 CFR Part 135 and will not
let any subcontract unless the contractor or
subcontractor has first provided it with a
preliminary statement of ability to comply with
the requirements of these regulations.
9.4 Conduct.
9.4.1 Assignability. PAHC and PAHCA, INC. shall not
assign or transfer any interest in this Agreement without the
prior written consent of the City; provided, however, that
claims for money due or to become due to PAHCA, INC. from the
City under this Agreement may be assigned to a bank, trust
company, or other financial institution without such approval.
Notice of any such assignment or transfer shall be furnished
promptly to the City.
9.4.2 Hatch Act. PAHC and PAHCA, INC. agrees that no
Funds provided, nor personnel employed under this Agreement,
shall be in any way or to.any extent engaged in the conduct of
political activities in violation of Chapter 15 of Title 5 of
the United States Code.
9.4.3 Conflict of Interest. PAHC and PAHCA, INC.
agree to abide by the provisions of 24 CFR Section 570.611 with
respect to conflicts of interest, and covenants that they
presently have no financial interest and shall not acquire any
financial interest, direct or indirect, which would conflict in
any manner or degree with the performance of Services required
under this Agreement. PAHC and PAHCA, INC. further covenants
that in the performance of this Agreement, no person having such
a financial interest shall be employed or retained by PAHC and
PAHCA, INC. hereunder. These conflict of interest provisions
apply to any person who is an employee, agent, consultant,
officer, or elected official or appointed official of the City,
or of any designated public agencies or PAHCA, INC.s which are
receiving Funds under the CDBG Program.
040316 syn 8250088
22
9.4.4 Subcontracts.
(a)PAHC and PAHCA, INC. shall not enter into any
subcontracts with any agency or individual in the
performance of this Agreement without the written
consent of the City prior to the execution of
such subcontracts.
(b)PAHC and PAHCA, INC. will monitor all subcontract
services on a regular basis to assure contract
compliance. Results of monitoring efforts shall
be summarized in written reports and supported
with documented evidence of follow-up actions
taken to correct areas of noncompliance.
(c)PAHC and PAHCA, INC. shall cause all of the
provisions of this Agreement in its entirety to
be included in and made a part of any subcontract
executed in the performance of this Agreement.
(d)PAHC and PAHCA, INC. shall undertake to ensure
that all subcontracts let in the performance of
this Agreement shall be awarded on a fair and
open competition basis. Executed copies of all
subcontracts shall be forwarded to the City along
with documentation concerning the selection
process.
9.4.5 Lobbying.
PAHC and PAHCA, INC. hereby certify that:
(a)No Federal appropriated funds have been paid or
will be paid, by or on behalf of it, to any
person for influencing or attempting to influence
an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or
an employee of a Member of Congress in connection
with the awarding of any Federal contract, the
making of any Federal grant, the making of any
Federal loan, the entering into of any
cooperative agreement, and the extension,
continuation, renewal, amendment,or modification
of any Federal contract, grant, loan, or
cooperative agreement;
(b)If any funds other than Federal appropriated
funds have been paid or will be paid to any
040316 syn 8250088
23
person for influencing or attempting to influence
an officer or employee of any agency, a Member of
Congress, an officer or employee of Congress, or
an employee of a Member of Congress in connection
with this Federal contract, grant, loan, or
cooperative agreement, it will complete and
submit Standard Form-LLL, ~Disclosure Form to
Report Lobbying," in accordance with its
instructions;
It will require that the language of paragraph
(d) of this certification be included in the
aware documents for all subawards at all tiers
(including subcontracts, subgrants, and contracts
under grants, loans, and cooperative agreements)
and that all PAHCA, INC.s shall certify and
disclose accordingly; and
(d)Lobbying Certification - Paragraph d
This certification is a material representation
of fact upon which reliance was placed when this
transaction was made or entered into. Submission
of this certification is a prerequisite for
making or entering into this transaction imposed
by section 1352, Title 31, U.S. Code. Any person
who fails to file the required certification
shall be subject to a civil penalty of not less
than $i0,000 and not more than $i00,000 for each
such failure.
9.4.6 Copyrights. If this Agreement results in any
copyrightable material, the City or grantor agency, or both,
reserves the right to royalty-free, non-exclusive and
irrevocable license to reproduce, publish or otherwise use and
to authorize others to use, the work for government purposes.
9.4.7 Religious Organizations. PAHC and PAHCA, INC.
agrees that Funds provided under this Agreement will not be
utilized for religious activities, to promote religious
interests, or for the benefit of a religious organization in
accordance with the federal regulations specified in 24 CFR
Section 570.200(j).
SECTION i0.ENVIRONMENTAL CONDITIONS
i0.i Air and Water. PAHC and PAHCA, INC. agree to
comply with the following regulations insofar as they apply to
040316 syn 8250088
24
the performance of this Agreement: Clean Air Act, 42 U.S.C.
7401, et seq.; Federal Water Pollution Control Act, as amended,
33 U.S.C. 1251, et seq., as amended, 1318 relating to
inspection, monitoring, entry, reports, and information, as well
as other requirements specified in said Section 114 and Section
308, and all regulations and guidelines issued thereunder; U.S.
Environmental Protection Agency regulations pursuant to 40 CFR
Part 50, as amended°
10.2 Flood Disaster Protection. In accordance with
the requirements of the Flood Disaster Protection Act of 1973
(42 USC 4001), PAHC and PAHCA, INC. shall assure that for
activities located in an area identified by FEMA as having
special flood hazards, flood insurance under the National Flood
Insurance Program is obtained and maintained as a condition of
financial assistance for acquisition or construction purposes
(including rehabilitation).
10.3 Lead-Based Paint. PAHC and PAHCA, INC. agree
that any construction or rehabilitation of residential
structures with assistance provided under this Agreement shall
be subject to HUD Lead-Based Paint Regulations at 24 CFR Part 35
et seq. as amended. Such regulations, effective September 15,
2000, set requirements for notification, evaluation and
reduction of¯ lead-based paint hazards in residential property
being assisted with Community Development Block Grant Funds.
10.4 Historic Preservation. PAHC and PAHCA, INC.
agree to comply with the historic preservation requirements set
forth in the National Historic Preservation Act of 1966, as
amended (16 U.S.C. 470) and the procedures set forth in 36 CFR
Part 800, Advisory Council on Historic Preservation Procedures
for Protection of Historic Properties, insofar as they apply to
the performance of this Agreement. In general, this requires
concurrence from the State Historic Preservation Officer for all
rehabilitation and demolition of historic properties that are
fifty years old or older or that are included on a federal,
state, or local historic property list.
SECTION ii.SEVERABILITY
If any provision of this Agreement is held invalid,
the remainder of the Agreement shall not be affected thereby and
all other parts of this Agreement shall nevertheless be in full
force and effect.
040316 syn 8250088
25
IN WITNESS WHEREOF, the parties hereto have by their
duly authorized representatives executed this Contract on the
date first above written.
ATTEST:CITY OF PALO ALTO
City Clerk
APPROVED AS TO FORM:
Senior Asst. City Attorney
APPROVED:
Assistant City Manager
Director of Administrative
Services
Director of Planning and
Community Environment
Insurance Review
Mayor
Title: ~’~°~T/4W£~
Taxpayer I.D. No. 23-7050326
Name:
Attachments:
EXHIBIT ~A":
EXHIBIT "B":
EXHIBIT ~C":
Tit i e : ~) ~z~,J~e~~
Taxpayer I.D. No. 94-2262125
(Compliance with Corp. Code § 313 is
required if the entity on whose behalf
this contract is signed is a corporation.
In the alternative, a certified corporate
resolution attesting to the signatory
authority of the individuals signing in
their respective capacities is
acceptable )
SCOPE OF SERVICES &TIME SCHEDULE
PROMISSORY NOTE
INSURANCE
040316 syn 8250088
26
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF CALIFORNIA~
COUNTY OF SANTA CLARA
On ~o~h~)%~tk , before me, the undersigned,
\ .a notary public an ~n~l for said .County, personally appeared
~lly known t~o me~ (or ~oved to me on the basis of
satisfactory evidence) to be the person(s) whose name(s) &re
subscribed to the within instrument, and acknowledged to me that
he/~they executed the same in his/ ~Zheir authorized
capacity(ies), and that by hise~their signature(s) on the
instrument the person(s), or the entity upon behalf .of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
040316 syn 8250088
27
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF CALIFORNIA )
)
COUNTY OF SANTA CLARA )
On ~e~e~{~~k , before me, the undersigned,
a notary Dubli~ in .and~ for .said County, personally appeared
pe~ally kn~~ (or pro~ed to me on the ba~ of
~dence) to be the person(s) whose name(s)i~.are
subscribed to the within instrument, and acknowledged to me that
he.they executed the same in his/ ~ their authorized
capacity(ies), and that by his/~their signature(s) on the
instrument the person(s), or the e-h--tity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
040316 syn 8250088
28
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF CALIFORNIA )
)
COUNTY OF SANTA CLARA )
On .._~~~)~)(’~(~, before me, the undersigned,
a notary public in and for, said County, personally appeared
~iI-~ known to~~ (or proved to me on the basis of
satisfa~ory evidence) to be the person(s) whose name(s) ~are
subscribed to the within instrument, and acknowledged to methat
~she/they executed the sas~_~in ~. her/their authorized
capacity(ies), and that by Qhis/~her/their signature(s) on the
instrument the person(s), or t~ entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
040316 syn 8250088
29
CERTIFICATE OF ACKNOWLEDGMENT
(Civil Code § 1189)
STATE OF CALIFORNIA )
)
COUNTY OF SANTA CLARA )
On ~.~~,’e~ , before me, the undersigned,
a notary public lO and fQI sald County, personally appeared
~lly "’known~(or proved to me on the basis~ of
sates ac ory evidence) to be the person(s) whose name(s) ~are
subscribed to the within instrument, and acknowledged to me that
authori~she/they executed the sam~e in ~ her/their zed
and that by h~/her/their~ signature(s) on the
instrument the person(s), or the entity upon behalf of which the
person(s) acted, executed the instrument.
WITNESS my hand and official seal.
~ MyCc~w~. ~ O~ 26, 2007
040316 syn 8250088
3O
EXHIBIT "A"
PALO ALTO HOUSING CORPORATION, OAK MANORTOWNHOUSES
DOMESTIC WATER SYSTEM
SCOPE OF SERVICES
Palo Alto Housing Corporation (PAHC) is a community-based non-
profit agency that develops and operates low and moderate income
housing in the City of Palo Alto. PAHC’s activities involve the
administration of the City’s Below market Rate purchase program,
development and acquisition of rental housing, property
management, and general housing advocacy. PAHC Apartments, Inc.
(PAHCA, Inc.) is a non-profit entity that owns several
properties located throughout the City.
This project consists of replacing the domestic water supply
system at Oak Manor Townhouses. Oak Manor Townhouses is a 33-
unit apartment property. 22 of the units are assisted under the
Section 8 Moderate Rehabilitation Program. CDBG funding will be
provided for Phase I of the project. The major tasks that
PAHCA, Inc. will perform in connection with the project include,
but are not limited to, the following:
Apply for City required permits and!or variances based on
proposed modifications to existing housing units;
o Prepare bid specifications in accordance with federal
regulations including but not limited to, prevailing wage
and competitive bid requirements;
o Select contractor;
Attend pre-construction conference; and
Complete all components of Phase I, which includes:
a.Replacement of water mains from meter with the 2-1/2"
reduced pressure principle valve device;
b.Trench new mains to property;
c.Run new mains to all boilers; and
do Run new main and tie onto existing risers to each
unit.
040316 syn 8250088
1
Competitive Bid Process
All contracts and subcontracts shall be awarded through a fair
and open competitive bidding process. The process shall be
reviewed and approved by City. PALO ALTO HOUSING CORPORATION
and PAHC APARTMENTS, INC. will use its best efforts to afford
minority and women-owned business enterprises the maximum
practicable opportunity to participate in the contracts let in
the performance of this project. Executed copies of all
contracts shall be supplied to City along with documentation
concerning the selection process.
Prevailing Wage and Federal Labor Standards
PALO ALTO HOUSING CORPORATION and PAHC APARTMENTS, INC., its
contractors and subcontractors shall comply with the Federal
Davis-Bacon Act Prevailing Wage requirements including inserting
the applicable wage decision into the bid documents, and all
contracts awarded under this Agreement. PAHC and PAHCA, Inc.,
the selected contractor and any subcontractors will participate
in a pre-construction conference with City to review Davis Bacon
compliance requirements, including reporting and monitoring.
Timeline:
The project will attempt to adhere to the following timetable:
September 20, 2004
April 15, 2004
Council contract approval
Meeting with City Staff to review
project specifications
August 15, 2004
October i, 2004
Bid Specifications Available/Ad in
paper ~
City Contract signed
September 15, 2004 Bid opening and contractor selection
October 15, 2004 Pre-construction conference
November i, 2004 Start of Construction
March i, 2005 Work Completed
040316 syn 8250088
EXItXBXT
FORM OF NOTE
PROMISSORY NOTE FOR REHABILITATION
SECURED BY
DEED OF TRUST ANDASSIGNMENT OF RENTS AS MODIFIED
(COMMUNITY DEVELOPMENT BLOCK GRANT FUNDS)
$113,672.00 Date:~~~ ~ . 2004
’ P~Io Alto, California
FOR VALUE RECEIVED, the undersigned, PAHC APARTMENTS,
INC., a corporation organized under the Nonprofit Benefit
Corporation Law of the State of California ("Maker"), hereby
promises to pay to the CITY OF PALO ALTO ("Holder"), or order,
at its Office of Revenue Collections, 250 Hamilton Avenue, Palo
Alto, California, or at such other place as may be designated in
writing by the Holder, the prinicipal sum of One Hundred
Thirteen Thousand Six Hundred Seventy-Two Dollars ($113,672.00)
("Loan Amount"), together with accrued, unpaid interest thereon,
from the date of this PROMISSORY NOTE FOR REHABILITATION (the.
"Note"), until paid, at the rate of three percent (3%) interest
per year, on a simple interest basis, on the unpaid principal
balance, as required hereunder, or as required under the Amended
Agreement referenced below.
ADDITIONAL TERMS AND CONDITIONS
i. This Note is made in connection with the agreement
between Holder and Maker entitled "Agreement No. Between
The City Of Palo Alto and PAHC Apartments, Inc. (PAHCA, Inc.)
For Funds Allocated During Fiscal Year 2003/04 Under The
Community Development Block Grant Program" (~Agreement"),
pursuant to which Holder provided to Maker a portion of the
funds to be used by Maker to rehabilitate the apartment complex
known as Oak Manor Townhouses at 630 Los Robles Avenue, Palo
Alto, California (the ~Property"). Maker will operate the
Property in accordance with the terms and conditions of the
Agreement. All terms, conditions, agreements and provisions,
including the convenants, representations, and terms of default
and remedies for default set forth in the Agreement are
incorporated herein by reference, and made a part hereof.
2. This Note evidences the obligation of the Maker to
make full payment of the Loan Amount to the Holder, in
accordance with the provisions of this Note and the Agreement.
1
040913 syn 8~88
Such funds are to be used solely by the Maker, together with
funds obtained by Maker for other sources, to rehabilitate the
Property, as more fully described in the Agreement.
3. This Note is secured by a Deed of Trust and Assignment
of Rents recorded against the Property (the ~Deed of Trust").
4. At any t’ime, and from time to time, the Maker may
prepay to the Holder the principal sum of this Note, or any part
thereof, without penalty.
5. Payment of principal and interest on this Note shall
be deferred from the date of its execution to that date which is
October i, 2023 as defined in the Agreement.
Notwithstanding any provision of this Note or the
Agreement, this Note shall become due and payable immediately,
without notice or demand, in the event all or any part of the
Property,or all or any part of the Maker’s interest in the
Project,(a) is sold, transferred, assigned or otherwise
conveyed,or (b) is further encumbered without the prior written
consent of Holder.
6. The Maker and any other maker, co-maker, endorser,
guarantor, and any other party to this Note (collectively,
"Obligors"), and each of them:(i) waive notice of default
(except as provided in Section i0) notice of acceleration,
notice of nonpayment, presentmentfor payment, demand, protest,
notice of demand, notice of protest, notice of nonpayment, and
any other notice required to be given under the law to the
Obligors: (ii) consent(s) to any and all delays, extensions,
renewals, or other modifications of this Note or waivers of any
term hereof or release or discharge by the Holder of any of the
Obligors or release, substitution, or failure to act by the
Holder, from time to time, and agree(s) that no such action,
failure to act, or failure to exercise any right or remedy on
the part of the Holder shall in any manner affect or impair the
obligations of any Obligor or be construed as a waiver by the
Holder of, or otherwise affect, any of the Holder’s rights under
this Note or the Agreement, under any endorsement or guaranty of
this Note; and (iii) (jointly and individually, if more than
one) agree(s) to pay, on demand, any and all costs and expenses
of collection of this Note or of any endorsement or any guaranty
hereof, including attorney’s fees.
No extension of time for payment of this Note or any
portion thereof made by agreement of Holder with any person now
or hereafter liable for the payment of this Note shall operate
040913 syn 8250088
to release or discharge liability of Maker under this Note,
either in whole or in part.
7. The pleading of any statute of limitations as a
defense to any demand against the Maker is ~expressly waived by
the Maker. -
8. If any default is made hereunder, the Maker promises
to pay the Holder’s reasonable attorneys’ fees and other related
costs and expenses incurred by the Holder in connection with the
enforcement of any rights of the Holder. The Holder’s right to
such fees shall include but not be limited to, its
representation by staff attorneys of the Holder’s office of the
City Attorney, and such representation shall be valued at the
customary and reasonable rates for private sector legal
services.
9. The occurrence of any of the following shall
constitute an event of default under this Note: (i) the Maker
fails to pay any amount due hereunder within fifteen (15) days
of its due date; or (ii) any default by the Maker under the
Agreement; or (iii) any default by Maker under the Modification
of Deed of Trust.
Upon the occurrence of any event of default, or at any time
thereafter, at the option of the Holder hereof, the entire
unpaid principal and interest owing on this Note shall become
immediately due and payable. This option may be exercised any
any time following any such event, and the acceptance of one or
more installments thereafter shall not constitute a waiver of
such option with respect to any subsequent event. The Holder.’s
failure in the exercise of any other right or remedy hereunder
or under any agreement which secures the indebtedness or is
related thereto shall not affect any right or remedy and no
single or partial exercise of any such right to remedy shall
preclude any further exercise thereof.
If the outstanding unpaid principal balance of this Note is
not paid within thirty (30) days of demand therefor, the Maker
shall pay to the Holder in addition to interest at the
Applicable Interest Rate, interest equal to one percent (1%) of
the unpaid principal amount, or the highest rate permitted by
law, whichever is less, per calendar month, or fraction thereof.
If this Note be reduced to judgment, such judgment shall bear
the statutory interest rate on judgments.
i0. The Holder shall not exercise any right or remedy
provided for herein because of any default of the Maker unless,
in the event of a monetary default, the Maker shall have failed
3
040913 syn 8250088
to pay the outstanding sums within a period of thirty (30)
calendar days after notice that payment was due. In the event
of an uncured nonmonetary default, the Holder shall have first
given written notice thereof to the Maker, and the Maker shall
have failed to cure the nonmonetary default within a period of
thirty (30) days after the giving of such notice of such
default; provided that if the nonmonetary default cannot be
cured within thirty (30) days and the Maker proceeds diligently
and uses best efforts to cure such default until it shall be
fully cured within no more than ninety (90) days after the
giving of such notice, then the Holder shall not exercise any
right or remedy provided for herein until such 90-day period
shall expire; provided, however, the Holder shall not be
required to give any such notice or allow any part of the grace
period if the Maker shall have filed a petition in bankruptcy or
for reorganization or a bill in equity or otherwise initiated
proceedings for the appointment of a receiver of its assets, or
if the Maker shall have made an assignment for the benefit of
creditors, or if a receiver or trustee is appointed for the
Maker and such appointment or such receivership isnot
terminated within forty-five (45) days of such appointment.
With respect to any right to cure or cure period in this
Section i0, performance of a cure by any affiliated entity or.
partner of the Maker shall have the same effect as would like
performance by the Maker.
ii. Any notice, demand, or other communi~cation required.
hereunder shall not be deemed sufficiently given, unless sent by
certified mail, postage prepaid, return receipt requested, or by
express delivery service or overnight courier service, to the
principal office of the addressee, or at such other address as
may be designated, fin writing, from time to time:
Holder:City of Palo Alto
250 Hamilton Avenue
Palo Alto, CA 94301
Attn: City Clerk
Maker:PAHC Apartments, Inc.
725 Alma Street
Palo Alto, CA 94301
Attn: President, Board of Directors
The delivery shall be effective on the date shown on the
delivery receipt or the date on which the delivery was refused.
040913 syn 8250088
12. This Note shall be nonrecourse against the 0bligors.
No judgment, or execution thereof, entered in any action, legal
or equitable, on this Note shall be enforced directly against
the Maker or any officer, director or employee of the Maker, but
shall be enforced only against the collateral described in the
Modification of Deed of Trust, and such other or further
security as, from time to time, may be hypothecated for this
Note. The foregoing limitation shall not be applicable in the
event of (a) fraud by the Maker or any material
misrepresentation made by the Maker to the Holder in the Amended
Agreement, this Note, the Modification of Deed of Trust, or any
other document or instrument delivered in connection with the
Loan, or (b) the sale or transfer or other conveyance or
encumbrance of the Property, or any interest therein, without
the Holder’s prior written consent, or (c) the sale or transfer
or other conveyance or encumbrance of all or any part of Maker’s
interest in the Project without the Holder’s prior written
consent. Furthermore, the foregoing limitation shall not be
applicable to the extent of any loss incurred by the Holder due
to (a) misappropriation by the Maker of any rents (including,
without limitation, the application of rents to other than
operating expenses and debt service), security deposits,
insurance or condemnation proceedings, or (b) the diversion or
other misappropriation by Maker of any funds from any reserve
account maintained in connection with the Project. The Holder
shall not in any way be prohibited from naming the Obligors, or
any of them, or any person holding under or through them as
parties to any actions, suit or other proceedings initiated by
the Holder to foreclose or otherwise realize upon any other lien
or security interest created under the Modification of Deed of
Trust, and further provided, however, that nothing in this
Section 12 shall be deemed to prejudice the rights of the Holder
to recover any funds or payments which were diverted or
misappropriated by’ the Obligors, or any of them.
13. The covenants, agreements, terms, and conditions of
this Note shall inure to, and shall be binding on, .the
successors and assigns of the Obligorso
//
//
//
//
040913 syn 8250088
5
EXECUTED BY MAKER by its duly authorized representative in
Palo Alto, County of Santa Clara, State of California, on the
date first above written.
By :
Name:
Taxpayer I.D. No. ~-~~%~
040913 syn 8250088
FORM 410
Certification of..Nondiscrimination: As suppliers of goods
or services to the City~o~ Palo Alto, the firm and
individuals listed below certify that they do not
discriminate in employment with regard to age, .race, color,
religion, sex, national origin, ancestry, disability, or
sexual preference; and that. they are in compliance with all
Federal, State and local directives and executive orders
regarding nondiscrimination in employment.
Date:
Title of Officer Signing:
Signature: