HomeMy WebLinkAboutMINUTES - 11132012 - C.33RECOMMENDATION(S):
APPROVE and AUTHORIZE the Director of Conservation and Development, or designee, to execute a
Memorandum of Understanding for $600,000 with the City of Concord, as successor agency to the Redevelopment
Agency of the City of Concord, for the County to facilitate the acquisition, rehabilitation, and sale of two homes to
very-low income families. The term of the contract is from the date all parties have approved the MOU until June 30,
2013. (No impact to General Fund)
FISCAL IMPACT:
No fiscal impact to the General Fund. All funds are City of Concord funds.
BACKGROUND:
The County Department of Conservation and Development administers a housing acquisition and rehabilitation
program through its Neighborhood Stabilization Program (NSP). Through NSP, the County works with approved
developers to purchase and rehabilitate vacant foreclosed homes in certain parts of Contra Costa County that have
been devastated by foreclosure. Once rehabilitated, the houses are sold to very-low, low, and
APPROVE OTHER
RECOMMENDATION OF CNTY ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE
Action of Board On: 11/13/2012 APPROVED AS RECOMMENDED OTHER
Clerks Notes:
VOTE OF SUPERVISORS
AYE:John Gioia, District I Supervisor
Candace Andersen, District II
Supervisor
Mary N. Piepho, District III
Supervisor
Karen Mitchoff, District IV
Supervisor
Federal D. Glover, District V
Supervisor
Contact: Kara Douglas,
674-7880
I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board
of Supervisors on the date shown.
ATTESTED: November 13, 2012
David Twa, County Administrator and Clerk of the Board of Supervisors
By: Carrie Del Bonta, Deputy
cc:
C. 33
To:Board of Supervisors
From:Catherine Kutsuris, Conservation & Development
Date:November 13, 2012
Contra
Costa
County
Subject:Memorandum of Understanding between Contra Costa County and the City of Concord for $600,000 to Provide Two
Homes to Very-Low Income Households
BACKGROUND: (CONT'D)
moderate income households.
The former Redevelopment Agency of the City of Concord has replacement housing obligations that have not yet
been met. Specifically, the Redevelopment Agency of the City of Concord was required to produce two very low
income units. The City of Concord, as successor agency to the Redevelopment Agency of the City of Concord
(Successor Agency), included $600,000 as an enforceable obligation on its Recognized Obligation Payment
Schedule for the period from July 1, 2012, through December 31, 2012 to acquire, rehabilitate, and sell the
replacement units.
The City desires to work with the County to identify, acquire, rehabilitate and sell to qualified buyers two homes
in Concord. All amounts expended by the County to cause a property to become a Replacement Unit, including
staff time, will paid by the Successor Agency. The MOU is attached in its substantially final form.
CONSEQUENCE OF NEGATIVE ACTION:
If the Board of Supervisors does not approve this contract, the program will be delayed or cancelled, and the
County will not receive the administrative fees that are earned through implementation of this program.
CHILDREN'S IMPACT STATEMENT:
This MOU will support the development of safe, decent, affordable housing and will support indicator 3: Families
are Economically Self-Sufficient.
ATTACHMENTS
Concord MOU
Signature Page
OAK #4852-4861-2113 v4 1
MEMORANDUM OF UNDERSTANDING
This memorandum of understanding (“MOU”) is dated ______________, 2012, and is
between the CITY OF CONCORD, as successor agency to the Redevelopment Agency of the City
of Concord (the “Successor Agency”), and the COUNTY OF CONTRA COSTA (the “County”).
R E C I T A L S
A. Upon the effectiveness of AB1 x26, which dissolved redevelopment agencies in
the State of California, the former Redevelopment Agency of the City of Concord had
replacement housing obligations under the Health & Safety Code that had not yet been met.
Specifically, the Redevelopment Agency of the City of Concord was required to produce two
very low income units (the “Replacement Units”).
B. In order to provide for the Replacement Units, the Successor Agency included
funds in the total amount of Six Hundred Thousand Dollars ($600,000) to acquire and create the
Replacement Units as an enforceable obligation on its Recognized Obligation Payment Schedule
for the period from July 1, 2102, through December 31, 2012 (“ROPS II”). The ROPS II was
approved by the Successor Agency’s Oversight Board on April 4, 2012, and the Amended ROPS
II was ratified by the Successor Agency’s Oversight Board on August 2, 2012, by Resolution No.
12-006 and approved by the Department of Finance. The amount of Six Hundred Thousand
Dollars ($600,000) to produce the Replacement Units is an approved enforceable obligation of
the Successor Agency.
C. The County has an existing purchase and rehabilitation program under which it
works with approved developers to purchase and rehabilitate vacant foreclosed homes in certain
parts of Contra Costa County that have been devastated by foreclosure. Once rehabilitated, the
houses are sold to low, moderate, or middle income households that satisfy certain income
parameters. Together, these activities are the “County Program.”
D. The Successor Agency desires to work with the County to identify, acquire,
rehabilitate and sell to qualified buyers, the Replacement Units. All amounts expended by the
County to cause a property to become a Replacement Unit (the “County’s Costs”) are the
responsibility of the Successor Agency. The County’s Costs include, but are not limited to, (i)
the total cost of acquiring the property, (ii) the total cost of rehabilitating the property, (iii) the
fee charged by the Developer, (iv) the County’s administrative expenses, including out-of-pocket
expenses, staff time, and legal expenses, and (v) the actual closing costs paid through escrow by
the title company upon the sale of a Replacement Unit.
E. Hearts and Hands of Compassion, a California nonprofit public benefit
corporation (the “Developer”) is an approved developer under the County Program. Using funds
provided by the County through the County Program, the Developer has acquired and
rehabilitated a property at 1197 Arch Court in the City of Concord (the “Arch Court Affordable
Unit”). The Successor Agency and the County believe that the Arch Court Affordable Unit may
satisfy the Successor Agency’s criteria for a Replacement Unit.
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F. In addition to the Arch Court Affordable Unit, the Successor Agency seeks the
County’s assistance in acquiring, rehabilitating and selling one as-yet-unidentified residential
property as a Replacement Unit.
G. The Successor Agency and the County desire to work together to enable the
Successor Agency to meet its obligation to provide Replacement Units.
The parties therefore agree as follows:
A G R E E M E N T
1. Term. This MOU is effective on the date (i) the Successor Agency, the County
and the Successor Agency’s Oversight Board have each approved the MOU, and (ii) the State of
California approves of, or fails to timely object to, this MOU. This MOU terminates when the
obligations set forth herein have been satisfied, unless earlier terminated by the mutual written
agreement of the parties. Upon termination of this MOU, neither party has any further rights or
obligations hereunder.
2. Replacement Unit Criteria. The parties will work together to identify
Replacement Units that meet the following criteria:
2.1 The house is located in the City of Concord.
2.2 The house is vacant.
2.3 The house is a single-family residence.
2.4 The County’s Costs are estimated to be $300,000 or less.
2.5 The house can be sold to a Very Low Income Household at an Affordable
Housing Cost.
3. County Responsibilities.
3.1 With respect to the Arch Court Affordable Unit, the County shall do the
following:
3.1.1 The County shall cause the Arch Court Affordable Unit to be
rehabilitated and shall maintain closing statements, invoices and receipts for the amounts
incurred and expended.
3.1.2 The County will assist the Successor Agency identify a household
whose annual income does not exceed the qualifying limits set for "very low income households"
in Section 50105 of the California Health and Safety Code, or any successor statute thereto (a
“Very Low Income Household”), to purchase the Arch Court Affordable Unit.
3.1.3 The County shall assist the Successor Agency arrange for the sale
of the Arch Court Affordable Unit to the Very Low Income Household identified by the
OAK #4852-4861-2113 v4 3
Successor Agency at an “Affordable Housing Cost,” as defined in Health and Safety Code
Section 50052.5, or any successor thereto that is in effect at the time of the sale.
3.1.4 The County shall record or cause to be recorded an affordable
housing covenant, in a form provided by the Successor Agency, against the Arch Court
Affordable Unit
3.1.5 Upon the close of escrow for the sale of the Arch Court Affordable
Unit to the selected Very Low Income Household, the County shall reimburse the Successor
Agency (i) the amount that results from subtracting the County’s Costs from the $300,000.00
provided to the County by the Successor Agency pursuant to Section 4.1.1., and (ii) the net
proceeds of the sale of the Arch Court Affordable Unit; provided, however, if the County’s Costs
exceed $300,000, the amount of the net proceeds of the sale reimbursed to the Successor Agency
will be reduced by the amount of such excess.
3.2 With respect to the as-yet-unidentified affordable unit, the County shall do
the following:
3.2.1 In cooperation with the Successor Agency, the County shall
endeavor to locate a house within the boundaries of the City of Concord that satisfies the criteria
of a Replacement Unit.
3.2.2 Once the County and the Successor Agency have identified a
property with the potential to be a Replacement Unit, the County shall submit to the Successor
Agency a financial pro forma and an estimated budget for the acquisition and rehabilitation of
the proposed Replacement Unit.
3.2.3 Upon the approval of the proposed property and the estimated
budget by the Successor Agency, the proposed property will be the “Second Replacement
Unit.” Once the Second Replacement Unit has been approved by the Successor Agency, the
County will enter into a loan agreement with the Developer that will enable the Developer to
acquire and rehabilitate the Second Replacement Unit (the “Developer Loan Agreement”).
3.2.4 The County shall cause the Developer Loan Agreement to include
provisions that require the Developer to provide insurance in the amounts and manner set forth
below:
(a) Worker's Compensation insurance to the extent required by law,
including Employer's Liability coverage, with limits not less than One Million Dollars
($1,000,000) each accident.
(b) Comprehensive General Liability insurance with limits not less
than Two Million Dollars ($2,000,000) each occurrence combined single limit for Bodily Injury
and Property Damage, including coverages for Contractual Liability, Personal Injury, Broadform
Property Damage, Products and Completed Operations.
(c) Comprehensive Automobile Liability insurance with limits not less
than One Million Dollars ($1,000,000) each occurrence combined single limit for Bodily Injury
and Property Damage, including coverages for owned, non-owned and hired vehicles, as
OAK #4852-4861-2113 v4 4
applicable; provided, however, that if the Developer does not own or lease vehicles for purposes
related to the purchase and rehabilitation of the Second Replacement Unit, then no automobile
insurance shall be required.
(d) Property insurance covering the Second Replacement Unit, in form
appropriate for the nature of such property, covering all risks of loss, excluding earthquake, for
one hundred percent (100%) of the replacement value, with deductible, if any, acceptable to the
County, naming the County and the Successor Agency as Loss Payees, as their interests may
appear. Flood insurance shall be obtained if required by applicable federal regulations. Blanket
Fidelity Bond covering all officers and employees, for loss of any of the proceeds of a loan made
by the County to the Developer in connection with the Second Replacement Unit (the “Loan”)
that is caused by dishonesty, in an amount not less than the amount of the Loan naming the
County a Loss Payee, as its interests may appear.
The Developer shall cause any general contractor, subcontractor, or agent
working on the Second Replacement Unit under direct contract with the Developer or
subcontract to maintain insurance of the types and in at least the minimum amounts described in
subsections (a), (b), and (c) above, except that the limit of liability for comprehensive general
liability insurance for subcontractors shall be One Million Dollars ($1,000,000), and shall require
that such insurance shall meet all of the general requirements of subsections (f), (g), and (h)
below, including, without limitation, the requirement of subsection (g). Liability and
Comprehensive Automobile Liability insurance to be maintained by such contractors and agents
pursuant to this subsection shall name as additional insureds the County, the Successor Agency,
their officers, agents, employees and members of their governing bodies.
(e) The required insurance shall be provided under an occurrence
form, and Developer shall maintain the coverage described in subsections (a) through (d)
continuously so long as the Loan is outstanding. Should any of the required insurance be
provided under a form of coverage that includes an annual aggregate limit or provides that
claims investigation or legal defense costs be included in such annual aggregate limit, Borrower
shall cause such annual aggregate limit to be three times the occurrence limits specified above.
(f) Comprehensive General Liability, Comprehensive Automobile
Liability and Property insurance policies are to be endorsed to name as an additional insured the
County, the Successor Agency, their officers, agents, employees and members of their governing
bodies.
(g) All policies are to be endorsed to provide thirty (30) days prior
written notice of cancellation, reduction in coverage, or intent not to renew to the address
established for notices to the County and Successor Agency.
3.2.5 The County shall cause the Developer Loan Agreement to include
a provision that requires the Developer to indemnify, defend and hold the County and the
Successor Agency harmless against all claims made against them and expenses (including
reasonable attorneys' fees) that arise out of or in connection with the purchase or rehabilitation of
the Second Replacement Unit and the marketing and sale of the Second Replacement Unit,
except to the extent such claim arises from the grossly negligent or willful misconduct of the
OAK #4852-4861-2113 v4 5
County, the Successor Agency, or their agents or employees. The provisions of this Section
3.2.5 will survive the expiration of this MOU.
3.2.6 The County shall work with the Developer to cause the Second
Replacement Unit to be rehabilitated. The County shall maintain closing statements, invoices
and receipts for the amounts incurred and expended.
3.2.7 The County will assist the Successor Agency identify a Very Low
Income Household to purchase the Second Replacement Unit.
3.2.8 The County shall assist the Successor Agency arrange for the sale
of the Second Replacement Unit to the Very Low Income Household identified by the Successor
Agency at an Affordable Housing Cost.
3.2.9 The County shall record or cause to be recorded an affordable
housing covenant, in a form provided by the Successor Agency, against the Second Replacement
Unit.
3.2.10 Upon the close of escrow for the sale of the Second Replacement
Unit to the selected Very Low Income Household, the County shall reimburse the Successor
Agency the amount that results from subtracting the County’s Costs from the $300,000.00
provided to the County by the Successor Agency pursuant to Section 4.2.2., and (ii) the net
proceeds of the sale of the Second Replacement Unit; provided, however, if the County’s Costs
exceed $300,000, the amount of the net proceeds of the sale reimbursed to the Successor Agency
will be reduced by the amount of such excess.
4. Successor Agency Responsibilities.
4.1 With respect to the Arch Court Affordable Unit, the Successor Agency
shall do the following:
4.1.1 The Successor Agency shall provide funds in the amount of
$300,000.00 to the County for the acquisition and rehabilitation of the Arch Court Affordable
Unit.
4.1.2 With the County’s assistance, the Successor Agency shall choose a
Very Low Income Household to purchase the Arch Court Affordable Unit and shall do all things
required of it to facilitate a timely sale of the Arch Court Affordable Unit to such purchaser.
4.1.3 Successor Agency shall provide an affordable housing covenant
between the Successor Agency and the selected Very Low Income Household purchaser, to be
executed by the Successor Agency and purchaser and recorded against the Arch Court
Affordable Unit. The Successor Agency is responsible for the ongoing monitoring of and
compliance with the terms of the covenant.
4.2 With respect to the Second Replacement Unit, the Successor Agency shall
do the following:
OAK #4852-4861-2113 v4 6
4.2.1 The Successor Agency shall cooperate with County to identify the
Second Replacement Unit and shall review and approve a pro forma budget for the acquisition
and rehabilitation of the Second Replacement Unit.
4.2.2 The Successor Agency shall provide funds in the amount of
$300,000.00 to the County for the acquisition and rehabilitation of the Second Replacement Unit.
4.2.3 With the County’s assistance, the Successor Agency shall choose a
Very Low Income Household to purchase the Second Replacement Unit and shall do all things
required of it to facilitate a timely sale of the Second Replacement Unit to such purchaser.
4.2.4 Successor Agency shall provide an affordable housing covenant
between the Successor Agency and the selected Very Low Income Household purchaser, to be
executed by the Successor Agency and purchaser and recorded against the Second Replacement
Unit. The Successor Agency is responsible for ongoing monitoring of and compliance with the
terms of the covenant.
5. No Partnership; No Agency. The parties acknowledge and agree that this MOU
does not create a partnership, joint venture or similar entity, and that no such partnership, joint
venture or similar entity has been created by or between the Successor Agency and the County.
6. Indemnification. The Successor Agency shall indemnity, defend, and hold
harmless the County, and its officers and employees from and against any and all claims, costs,
and liability, including reasonable attorneys’ fees, to the extent caused by, or arising directly or
indirectly out of, or connected with, the services of the County or its agents, servants, or
employees under this agreement (the “Claims”), except for (a) Claims covered by the
Developer’s insurance and indemnification, or excluded based on County’s grossly negligent or
willful misconduct, provided pursuant to Section 3.2.4 and Section 3.2.5; (b) Claims covered by
the Developer’s insurance and indemnification of County with respect to the Arch Court
Affordable Unit; or (c) Claims arising through the gross negligence or willful misconduct of the
County or its officers or employees. The terms of this Section 6 shall survive the termination or
expiration of this MOU.
7. Notices. All correspondence regarding this MOU, including invoices, payments,
and notices, are to be delivered by deposit in the United States mail (first-class with postage
prepaid) and directed to the following persons at the following addresses:
Successor Agency: City Manager
City of Concord
1950 Parkside Drive
Concord, CA 94519
Telephone: (925) 671-3150
OAK #4852-4861-2113 v4 7
County: Catherine O. Kutsuris, Director
County of Contra Costa
Department of Conservation & Development
30 Muir Road
Martinez, CA 94553
8. Applicable Laws. The parties shall comply with all applicable statutes,
ordinances, laws, rules, regulations and requirements under Federal, State, County, City and
other local authority applicable to the implementation of this MOU.
9. Amendments to MOU. This MOU may only be modified in writing by an
amendment signed by the parties.
10. Assignment. This MOU may not be assigned by either party.
11. Governing Law; Venue. The interpretation, validity and enforcement of this
MOU is governed by and is to be construed under the laws of the State of California, excluding
its conflict of laws rules. Any suit, claim or legal proceeding of any kind related to this MOU
must be filed and heard in a court of competent jurisdiction in Contra Costa County, California.
12. Authority to Enter into MOU. The individuals executing this MOU on behalf of
the Successor Agency and the County each represent and warrant that they have the right, power,
legal capacity and authority to enter into and to execute this MOU.
13. Entire Agreement; Counterparts. This MOU contains the entire understanding of
the parties with respect to the subject matter hereof and supersedes all prior and
contemporaneous agreements and understandings, oral and written, between the parties with
respect to such subject matter. This MOU may be executed in multiple counterparts, each of
which is an original and all of which together constitute one agreement.
OAK #4852-4861-2113 v4 8
The parties are executing this MOU as of the date and year first above written.
COUNTY:
COUNTY OF CONTRA COSTA
By: ________________________________
Aruna Bhat, Deputy Director
Community Development
APPROVED AS TO FORM:
SHARON L. ANDERSON, County Counsel
By: ________________________________
Kathleen M. Andrus
Deputy County Counsel
SUCCESSOR AGENCY:
CITY OF CONCORD, AS SUCCESSOR
AGENCY TO THE REDEVELOPMENT
AGENCY OF THE CITY OF CONCORD
By: ________________________________
Valerie Barone, Interim City Manager
ATTEST:
By: ________________________________
Mary Rae Lehman, City Clerk
APPROVED AS TO FORM:
By: ________________________________
Mark Coon, City Attorney