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HomeMy WebLinkAboutMINUTES - 10222002 - C72 s TO: BOARD OF SUPERVISORS , r�r y �. "lcontra Costa FROM: Dennis M. Barry, AICP County Community Development Director DATE: October 22, 2402 SUBJECT: Somerset Affordable Homes Property Transfer: 242 Portola Drive SPECIFIC REQUEST(S) OR RECOMMENDATIONS(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS As the Board of Supervisors: 1. ADOPT Resolution to Convey Real Property, Assessor's Parcel 203-061-031 to the Contra Costa County Redevelopment Agency. 2. AUTHORIZE the Director of Community Development, or his designee, to enter into the legal documents required for the transfer of said properties to the Contra Costa County Redevelopment Agency. 3. AUTHORIZE the Deputy Director-Redevelopment, on behalf of the County, to enter into Buyer Resale Agreement with the ultimate purchasers of the said properties. As the Governing Body of the Redevelopment Agency: 1. AUTHORIZE the Contra Costa County Redevelopment Agency(Agency)to accept conveyance of the following real property from the County of Contra Costa(County): assessor's parcels 203-061- 031, 2. AUTHORIZE the Deputy Director-Redevelopment,or his designee,to enter into the legal documents required for the transfer of title of above properties from the County to the Agency pursuant to California Health and Safety Code Section 33449. CONTINUED ON ATTACHMENT: X YES SIGNATURE: ;'•. fECOMMENDATION OF COUNTY ADMINISTRATOR bMMENDATION OF BOAAD COMMITTEE ; ,__-APPROVE OTHER I `p ,f SIG"ti€ATURE(S).-/ _ ', ,. � y ACTION OF BOARD ON PPROVED AS RECOMMENDED OTHER VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A UNANIMOUS (ABSENT /U TRUE AND CORRECT COPY OF AN AYES: NOES: ACTION TAKEN AND ENTERED ON THE ABSENT: ABSTAIN: _ MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE SHOWN. Contact: Kara Douglas, 335-1253 ATTESTED s�'ez- ,emsaY Orifi: Community Development JOHN SWEETEN, CLERK - cc: County Administrator OF THE BOARD OF SUPERVISORS County Counsel AND COUNTY ADMINISTRATOR Auditor-Controller BY yF{ �> , DEPUTY .FISCAL IMPACT No General Fund or Redevelopment Agency impact. This program utilizes the Affordable Housing Special Revenue Fund(Fund 111300, Org. 1596) to acquire the properties from sellers; the properties are resold to eligible buyers. The Affordable Housing Special Revenue Fund is reimbursed net of transaction costs. BACKGROUND/REASONS FOR RECOMMENDATIONS In accordance with the terms of a Development Agreement between the County and Dame Construction Company(1993), Dame agreed to provide 23 Affordable Units in the Somerset Homes development in exchange for development approvals, including a density bonus,received from the County. As required by the Agreement, the Affordable Units were sold to qualified moderate-income households at below-market prices providing a homeownership opportunity to the purchaser. Purchasers of the affordable units were required to enter into a Buyer's Purchase Agreement which provided the County with the right of first refusal to acquire, or to assign its right to acquire the unit at a predetermined price, in the event of resale. Purchasers are required to notify the County when they intend to sell their units. The purpose of the resale restriction is to provide the County with an opportunity to maintain the affordability of the unit for another moderate-income household. An owner of an affordable unit in the Somerset Homes development informed the County that she wished to sell her unit. In order to preserve the affordable units, the County purchased the property. A buyer for the property has been identified. State law requires Counties to sell property at auction, unless below-market property is being sold to eligible buyers. The former is not practicable to maintain affordability, and the latter requires a 30- year terns of affordability, which is in conflict with the Somerset program 15-year terra. Redevelopment agencies are not subject to these requirements; therefore, in order to facilitate the timely sale of these properties to eligible households, the County wishes to transfer the properties to the Redevelopment Agency. The Agency is scheduled to accept conveyance of the properties from the County on October 22, 2002, and to convey the property to an eligible household at a public hearing on November 5, 2002. A revised Buyer's Resale Agreement, which is the Agreement between the purchaser of the affordable unit and the County, has been prepared. The new Agreement re-defines the program, and clarifies the roles and responsibilities of the County and the owner in the event of resale during the term of affordability. KD HAkdouglas\NevABoard Orders\2002\S-mt prop tran.doe THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA Adapted this Resolution on October 22, 2002, by at least a four-fifths vote as follows: AYES: S,rn SORS UUM%, MM, WSMM , =M AM cIaIA NOES: NM ABSENT: jjM ABSTAIN: RESOLUTION NO. 2002/.674 (Gov. Corse § 25365) SUBJECT: Conveyance of Real Property Assessor's Parcel 203-061-031 (1596-3540) Danville Area (CP No. 2002-68) The Board of Supervisors of Contra Costa County RESOLVES THAT: Contra Costa County acquired certain real property in the Danville area, located at 242 Portola Drive, for the purpose of maintaining affordability of homes through the Somerset Density Bonus Program, This Board intends to convey to the Contra Costa County Redevelopment Agency said real property, described in Exhibit "A" attached hereto, in order to facilitate timely resale to eligible households. Proceeds from resale will be used to reimburse the Affordable Housing Special Revenue Fund, the source of funding for the original purchases. This Board hereby APPROVES and AUTHORIZES the conveyance of said property to the Contra Costa County Redevelopment Agency, pursuant to Government Code Section 25365,and the Board Chair is hereby AUTHORIZED to execute a Grant Deed on behalf of the County conveying said property to the Redevelopment Agency. The Board also AUTHORIZES the Deputy Director-Redevelopment to execute,on behalf of the County, the buyers' resale agreements imposing fifteen (15)year resale restrictions on the homes at the time of their sale to existing homebuyers, pursuant to the Somerset Density Bonus Program, in substantially the form attached hereto, with modifications as are approved by the Deputy Director- Redevelopment. I hereby certify that this is a true and correct copy of an action taken and entered on the LLO:eh minutes of the Board of Supervisors on the O.tGrp,DateRea(Propl2002-FilesOOs&RESIBRIO PORTOLA.doc date shown. Orig.Dept.: Public works(€ /P) Contact: L.Lucy Owens(313-2229) ATTESTED: 0CMM 21 cc: County Administrator JOHN SWEETEN, lerkof the Board of Auditor-Controller Supervi rs and County Administrator Assessor's Office Community Development Dept. Board Orders Clerk,Adm. BY `a Deputy RESOLUTION NO. 2002/674 "Exhibit A" Legal Description The land referred to herein is situated in the State of California, County of Contra Costa, unincorporated area, and is described as follows: Lot 31, as shown on Subdivision 7763, filed June 3, 1993, in Book 366 of Maps at Page 4, Contra Costa. County Records. Reserving unto the Grantor: All oil, gas, casinghead gasoline and other hydrocarbon substances of any bind below a point 500 feet below the surface of the lands,together with the right to take, remove,pass through and dispose of all said oil, gas, casinghead gasoline and other hydrocarbon and mineral substances,but without any rights whatsoever to enter upon the surface of said land or upon any part of said lands within 500 feet from the surface thereof, Assessor's Parcel No.: 203-061--031 C-:\GrpData\Rea]Prop\2002-Fates\02-7\ExhibitA-Lucy.doc } Recorded at the request of Centra Costa County Return to: Contra Costa County Real Property 255 Glacier Drive Martinez, CA 94553 Attention: L. Lucy Owens Assessor`s. Parcel No. 203-061-031 GRANT DEED For valuable consideration, receipt of which is hereby acknowledged, CONTRA COSTA COUNTY, a political subdivision of the State of California, Grants to the CONTRA COSTA COUNTY REDEVELOPMENT AGENCY,a body corporate and politic existing under the laws of the State of California,the following described real property in the unincorporated area of the County of Contra Costa, State of California. FOR.DESCRIPTION SEE EXHIBIT"A"ATTACHED HERETO)AND MADE A PART HEREOF, CONTRA COSTA COUNTY Dated t � � C ai , 13oard of Supervisors STATE OF CALIFORNIA ) COUNTY OF CONTRA COSTA } On QLLJ21 �a; before me,John Sweeten,Clerk of the Bard of Supervisors and County Administrator, Contra Costa County,personally appeared who is personally known to me (or proved to me on the basis of satisfactory evidence)to be the person(s)whose name(s)is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacitoes), and that by his/her/their signature(s)on the instrument the person(s), or the entity upon behalf of which the person )acted,executed the instrument. By: Deputy Clerk LLO:eh G.tCrpData%RealProp''2002-Filesl02-10ide3portola.doc 10;x/02 "Exhibit All Legal Description The land referred to herein is situated in the State of California, County of Contra Costa, unincorporated area, and is described as follows. Lot 31, as shown on Subdivision 7763, filed June 3, 1993,in Book 366 of Maps at Page 4, Contra.Costa County Records. Reserving unto the Grantor: All oil, gas, casinghead gasoline and other hydrocarbon substances of any kind below a point 500 feet below the surface of the lands,together with the right to take,remove,pass through and dispose of all said oil, gas, casinghead gasoline and other hydrocarbon and mineral substances,but without any rights whatsoever to enter upon the surface of said land or upon any part of said lands within 500 feet from the surface thereof. Assessor's Parcel No.: 203-061-031 G:\GrpData\RealPmp\2002-Files\02-7\ExhibitA-Lucy.doc BUYER'S RESALE AGREEMENT CONTRA COSTA COUNTY DENSITY BON-US PROGRAM ADMINISTRATIVE CHECKLIST (Remove Upon Completion) BLANC LINES: CHECKLIST Owner's Name and Address of Horne Purchased,p. I Date, p. 1, first paragraph Owner's Name, p. 1, first paragraph First Lender's Name, p. 2, Recital F Execution Date and Recording Date of First Lender Deed of Trust,p. 2,Recital F Home Address, p. 3, Section 2 Original Purchase Price of Home, p. 7, Section 11.A. Signatures,p. 18 Include Exhibit A, Property Description Notary e63t30t123603.4 1/23;99 RECORDING REQUESTED PURSUANT TO GOVERNMENT CODE SECTION 27383 When Recorded Mail To: County of Centra Costa Community Development Department 651 Pine Street, 4th Floor, North Wing Martinez, CA 94553-0006 Attn: Deputy Director-Redevelopment BUYER'S RESALE AGREEMENT CONTRA COSTA COUNTY DENSITY BONUS PROGRAM (Somerset Hames) Owner: Home: This Buyer's Resale Agreement(the "Agreement") is entered into as of this th day of __,20 by and between the County of Contra Costa(the "County") and � (the '"Owner"). RECI'T`ALS A. California Density Bonus Law(California Government Code Sections 65915 - 65917)requires the County to grant density bonuses to developers who agree to construct affordable housing units as part of their developments. The California Density Bonus Law requires the County to ensure continued affordability of density bonus units for a minimum of ten years.. B. Dame Construction Company,the developer of the Somerset Domes (the "Developer"), was granted a density bonus by the County and entered into a Developer Agreement dated April 28, 1993 to implement the requirements of the California Density Bonus Law. Pursuant to the Developer Agreement, the Developer sold fifteen percent(15%)of the Somerset Homes units to low and moderate income households at affordable prices (the "Density Bonus Units"). 863\30\123603.4 11/23/99 1 C. Owner intends to purchase the property located at in the County of Contra Costa and more particularly described in Exhibit A attached hereto and incorporated herein(the "Home"). The Home is one of the Density Bonus Units which has been transferred to the County by the original purchaser. The County has transferred the Horne to the Contra Costa County Redevelopment Agency(the "Agency") in order that the Agency may sell the Home to the Owner. D. Pursuant to the California Density Bonus Statute, the County is required to ensure the continued affordability of the Home as a Density Bonus Unit, and the County and the Agency therefore require the Owner to execute this Agreement as a condition of the Owner's purchase of the Home. The Owner has agreed to execute and comply with this Agreement in consideration of the Agency's agreement to sell the Home to the Owner at an affordable price which is below the fair market value of the Home. E. The purpose of this Agreement is to place resale controls on the Home and to require the payment of any excess proceeds of sale to the County. This Agreement also provides the County an option to purchase the Home at a restricted price, given in consideration of the economic benefits to the Owner resulting from purchase of the Horne at a below market price under the County's Density Bonus Program. F. The Owner is receiving a first mortgage loan (the "First Mortgage Loan") from (the "First Lender"). The First Mortgage Loan is secured by a deed of trust dated , 20 , executed by the Owner in favor of First Lender and recorded in the County of Contra Costa on , 20. and assigned Recorder's Serial No. (the "First Mortgage Deed of Trust"). G. This Agreement shall be secured by a deed of trust on the Home(the "County Deed of Trust"). This Agreement and the County Deed of Trust shall be subordinate to the lien of the First Mortgage Deed of Trust. NOW,THEREFORE, in consideration of the benefits received by the Owner and the County hereunder, the Owner and the County agree, as follows: I. DEFINMONS The following terms are specially defined for this Agreement and their definitions can be found in the sections indicated below: A. "Agreement" - First sentence of the Agreement on page I B. "County" - First sentence of the Agreement on page I 863\30\123603.4 /1/23199 2 C. "County Deed of Trust" - Recital G D. "County Option" - Section 10 E. "Eligible Capital Improvements" - Section I IA(2) F. "Eligible Purchaser" - Section I2B G. "Excess Sales Proceeds" - Section 13 H. "Fair Market Value" - Section 1113 1. "First County Response Notice" - Section 8 J. "First Lender" -Recital F K. "First Mortgage Deed of Trust" -- Recital F L. "First Mortgage Loan" -Recital F M. "Horne" - Recital C and Section 2 N. "Market Purchaser" - Section 12E O. "Marketing Period" - Section I2A P. "Maximum Sales Price" - Section I I Q. "Owner" - First sentence of the Agreement on Page I R. "Owner"s Notice of Failure to Locate Eligible Purchaser" - Section 12E S. "Owner"s Notice of Intent to Transfer" - Section 7 T. "Restricted Future Sales Price" - Section 1 IA U. "Second County Response Notice" - Section 12E Y. "Transfer" - Section 6 2. DESCRIPTION OF PROPERTY This Agreement concerns the real property commonly known as , California ,which is more fully described in Exhibit A attached hereto and incorporated in this Agreement by reference (the "Home"). 1//23159 3 3. OWNER CERTIFICATION-S,« OWNER OCCUPANCY REQUIREMENT The Owner certifies that the financial and other information previously provided in order to qualify to purchase the Home is true and correct as of the date first written above. The Owner shall occupy the Home as the Owner's principal place of residence. The Ower shall be considered as occupying the Home if the Owner is living in the unit for at least ten (10)months out of each calendar year. The Owner shall provide an annual written certification to the County that the Owner is occupying the Home as his or her principal place of residence. 4. LEASING OF HOME The Owner shall not lease the Home to another party. Any lease in violation of this Agreement is prohibited. 5. MALNTE-NANTCE AND INSURANCE REQUIREMENTS A. The Owner shall maintain the Home, including landscaping, in good repair and in a neat,clean and orderly condition and will not commit waste or permit deterioration of the Home. E. The Owner shall maintain a standard all risk property insurance policy equal to the replacement value of the Home (adjusted every five(5)years by appraisal, if requested by County), naming the County as an additional insured. Additional insurance requirements are set forth in Section 5 of the County Deed of Trust. 6. RESTRICTIONS ON RESALE OF THE HOME Any Transfer of the Home will be subject to the provisions of this Agreement including, without limitation, the County Option described in Section 10 below. "Transfer"means any sale, assignment or transfer, voluntary or involuntary, of any interest in the Home, including,but not limited to, a fee simple interest, a joint tenancy interest, a life estate, a leasehold interest, or an interest evidenced by a land contract by which possession of the Home is transferred and Owner retains title. Any Transfer without satisfaction of the provisions of this Agreement is prohibited. Transfers by devise or inheritance to an existing spouse, domestic partner, child, surviving joint tenant, or a spouse as part of a dissolution proceeding, or in connection with marriage shall not be considered a Transfer for the purposes of this Agreement. 7. NOTICE OF IN-TENDED TRANSFER;-PREPARATION. OF HOME FOR SALE A. In the event the Owner intends to Transfer or vacate the Home, the Owner shall promptly give the County written notice of such intent(the "Owner's Notice of Intent to 86313MI23803.4 1/123/99 4 Transfer"). The Owner's Notice of Intent to Transfer shall be sent to the County by certified mail, return receipt requested at the address provided in Section 30 of this Agreement. The Owner's Notice of Intent to Transfer shall include the information necessary for the County to determine the Restricted Future Sales Price of the Home, including the following information: (1) the address of the Property; (2) the date of purchase of the Howie by the Owner; (3) the purchase price of the Home paid by the Owner at the time of his/her purchase; (4) a copy of the HUTS-1 Settlement Statement or equivalent document from the close of escrow on the Owner's purchase of the Home; (5) if Owner has made Eligible Capital Improvements to the Horne that he/she wishes to include in the calculation of Restricted Future Sales Price, a description of the improvements, the date the improvements were made, a copy of the letter granting prior County approval of the improvements, evidence of cost of the improvements, and an appraisal of the value added to the Home by the Eligible Capital Improvements; (6) the date on which Owner intends to vacate Home; (7) the date Home will be placed on the market; and (8) the name and phone number of the person to contact to schedule inspection of the Home by the County. E. The Owner may not wish to contract with a real estate broker to sell the Home until the Owner has received the First County Response Notice pursuant to Section 8A below, as the services of a broker will not be required if the County exercises the County_ption to purchase the Home pursuant to Sections 8A and 10 below. C. Fallowing delivery to the County of the Owner's Notice of Intent to Transfer, the Owner shall prepare the Home for sale, as follows: (1) within thirty(39) days of delivery of the Owner's Notice of Intent to Transfer, the Owner shall obtain and deliver to the County a current written report of inspection of the Home by a licensed structural pest control operator; (2) within the sooner of(a) sixty(64)days from the date of delivery of the Owner's Notice of Intent to Transfer, or(b)prior to close of escrow on the Transfer, the Owner shall repair all damage noted in the pest report including damage caused by infestation or infection by wood-destroying pests; 863\30\123603.4 11/23199 5 (3) within thirty(30) days of the date of the Owner's Notice of Intent to Transfer, the Owner shall allow the County, or its designee, to inspect the Home to determine its physical condition; (4) if the Home is vacant, the Owner shall maintain utility connections until the close of escrow on the Transfers (5) in the event of County purchase of the Home, the Owner shall permit a final walk-through of the Home by the County in the final three(3)days prior to close of escrow on the Transfer. 8. COUNTY RESPONSE TO OWNER'S NOTICE OF INTENDED TRANSFER The County shall respond in writing(the "First County Response Notice")to the Owner's Notice of Intent to Transfer within sixty(60) days of County receipt of a complete Owner's Notice of Intent to Transfer that includes all information required under Section. 7 above. The County Response Notice shall inform the Owner of the County's election to proceed under one of the following two alternatives; A. County Exercise of Counjy Purchase Option. The First County Response Notice may notify the Owner that the County elects to exercise the County Option to purchase the Home, as granted in Section 10 below, and shall include the County's calculation of the Maximum Sales Price to be paid by the County pursuant to Section I I below and the Transaction Fee to be paid by the Owner pursuant to Section 10 below. E. Owner Sale at Restricted Sale Price to Eligible Purchaser. Alternatively, the First County Response Notice may notify the Owner that the County will not at this time exercise the County Option to purchase the Home and that the Owner may proceed to sell the Home to an Eligible Purchaser at a price not to exceed the Maximum Sales Price,pursuant to the procedure set forth in Section 12 below. In this event,the First County Response Notice shall include the following information: (1)the maximum qualifying income for an Eligible Purchase; (2)the certifications required of an Eligible Purchaser; and(3)the Maximum Sales Price the Owner may receive for the Horne, calculated by the County pursuant to Section I I below. 9. OWNER ACKNOWLEDGMENT OF COUNTY RESPONSE NOTICE No later than. seven(7)days following the date of the First County Response Notice, the Owner shall acknowledge in writing to the County that he/she has received the County Response Notice and still intends to Transfer the Home. 88M0\123603A 11/23/99 6 10. COUNTY PURCHASE OPTION The Owner agrees that the County shall have the option to purchase the Horne (the "County Option") for an amount equal to the lesser of: (i)the Fair Market Value of the Horne, or (ii) the Restricted Future Sales Price as set forth in Section 11 of this Agreement. The County may, instead of purchasing the Home itself, assign its right to purchase the Home pursuant to the County Option to another public agency, a nonprofit corporation, or to an Eligible Purchaser. The Owner shall pay the County a transaction fee equal to six percent(6%)of the sales price if the County(or its assignee) exercises the County Option and purchases the Home. The County Option may be exercised at two separate times as follows: a. The County Option may be exercised by the County in the First County Response Notice, as described in Section gA above,to be sent by the County to the Owner within sixty(60) days of the County's receipt of a complete Owner's Notice of Intent to Transfer. If the First County Response Notice notifies the Owner that the County will exercise the County Option to purchase, the County shall purchase the Home within ninety(94) days of the date of the First County Response Notice. b. The County Option may also be exercised by the County in the Second County Response Notice (as described in Section 12E below), to be sent by the County to the Owner within fifteen (15)days of receipt of the Owner's Notice of Failure to Locate Eligible Purchaser. If the Second County Response Notice states that the County will exercise the County Option, the County shall purchase the Home within seventy-five (75) days of the date of the Second County Response Notice. IL DETERMINATION OF MAXIMUM SALES PRICE FOR COUNTY PURCHASE OR RESTRICTED SALE If the County exercises the County Option, or if the Owner sells to an Eligible Purchaser, the maximum sales price(the "Maximum Sales Price")that the Owner shall receive from the County or the Eligible Purchaser for purchase of the Home shall be the Restricted Future Sales Price or the Fair Market Value, whichever is less. A. Restricted Future Sales Price. (1) The Restricted Future Sales Price of the Home means the sales price of the Home at the time of purchase by the Owner, which was ( ), increased by the percentage of increase in the Median Income from the date of the original purchase of the Horne by the Owner to the date of receipt by the County of the Owner's Notice of Intent to Transfer, and, where applicable, adjusted pursuant to subsection (2)below to reflect the value of capital improvements or the cost of deferred maintenance. "Median Income" shall refer to the median yearly income, adjusted for a household size of four, in the Oakland Primary Metropolitan Statistical Area as published by the California Department of Housing and Community Development("HCD"), or, in the event such income determination is no longer published by HCD, or has not been updated for a period of at 863;s0\123603.4 19/23199 7 least eighteen(1 8)months, the County may use or develop such other reasonable method as it may choose in order to determine the median yearly income in Contra Costa County. (2) Where applicable, the Restricted Future Sales Price shall include an upward adjustment reflecting the value of any substantial structural or permanent fixed improvements which the Owner has made to the Home after purchase of the Home. No such adjustment shall be made except for improvements: (a)made or installed by the Owner which conformed with applicable building codes at the time of installation; (b)approved in writing in advance by the County or its designee; and(c)whose initial costs exceed one percent(1%) of the purchase price paid for the Home by the Owner. Improvements meeting the above requirements are referred to in this Agreement as "Eligible Capital Improvements." The adjustment to the Restricted Future Sales Price for such Eligible Capital Improvements shall be limited to appraised increases in value to the Home as a result of the improvements (pursuant to an appraisal performed as described in Section 11B below) and not the cost of construction of the improvements to the Home. The Restricted Future Sales Price shall include a downward adjustment, where applicable, in an amount necessary to repair any violations of applicable building,plumbing, electric, fire or housing codes or any other provisions of the Contra Costa County Building Code, as well as any other repairs needed to put the Home into a "sellable condition". Items necessary to put a Home into sellable condition shall be determined by the County or its designee, and may include cleaning, painting and making needed structural, mechanical, electrical,plumbing and fixed appliance repairs and other deferred maintenance repairs. B. Fair Market Value. In certain circumstances it may be necessary to determine the fair market value of the Home (the "Fair Market Value"). These circumstances include: (1) where the parties wish to determine if the Restricted Future Sales Price exceeds the Fair Market Value in order to determine the Maximum Sales Price pursuant to Section 11; (2)where the Owner is selling the Home to an Market Purchaser at an unrestricted price pursuant to Section 12E; (3)where the parties wish to determine the value of Eligible Capital Improvements in order to calculate the Restricted Future Sales Price pursuant to Section 11A; and(4)where the Owner wishes to refinance the First Mortgage Loan as described in Section 23 below. If it is necessary to determine the Fair Market Value of the Home, it shall be determined by a certified MAI or other qualified real estate appraiser approved in advance by the County. If possible, the appraisal shall be based upon the sales prices of comparable properties sold in the market area during the preceding three-month period. The cost of the appraisal shall be shared equally by the County and the Owner, unless the appraisal is obtained from a new purchaser, or unless the appraisal is necessary because the Owner wishes to refinance the First Mortgage Loan pursuant to Section 23 below, in which event the Owner shall pay the cost of the appraisal. In the event that the Owner has made capital improvements to the Home(which have been approved in advance by the County pursuant to Section 11 A of this Agreement)which have increased the value of the Home or if damage or deferred maintenance has occurred while the Owner owned the Home which has decreased the value of the Home, the appraisal shall specifically ascribe a value to these adjustment factors and state what the fair market value of the Herne would be without such adjustments by utilizing the procedures outlined in Section I IA.above for calculating the Restricted Future Sales Price. Nothing in this section shall preclude the Owner 863130\123603.4 11/23199 8 and the County from establishing the Fair Market Value of the Home by mutual agreement in lieu of an appraisal pursuant to this section. 12. SALE OF HOME BY OWNER IF COUNTY DOES NOT EXERCISE COUNTY OPTION TO PURCHASE In the event the First County Response Notice notifies the Owner to proceed to sell the Home to an Eligible Purchaser at a price not exceeding the Maximum Sales Price, the Owner may proceed to sell the Horne in compliance with the following requirements; A. Marketing Period. The Owner shall have sixty(60) days from,the date of the First County Response Notice(the "Marketing Period")to market the Home and find an Eligible Purchaser. During the Marketing Period,the Owner shall use bona fide goodfaith efforts to sell the Home to an Eligible Purchaser in compliance with this Section 12, including keeping the Home in an orderly condition, making the Home available to show to agents and prospective buyers, and providing buyers with Eligible Purchaser requirements, including income qualifications and the County's form of disclosure statement summarizing the terms of the buyer's resale agreement. If the Owner has not located an Eligible Purchaser within this sixty (60)day marketing period, the Owner may request an additional sixty(60)day marketing period. A proposed purchaser("Proposed Purchaser"),who the Owner believes will qualify as an Eligible Purchaser, shall be referred to the County for an eligibility determination. B. Eligible Purchaser. A Proposed Purchaser shall qualify as an "Eligible Purchaser" if he or she meets the following requirements, as determined by the County: (1) Intent to Owner Oce . The Proposed Purchaser shall certify that he or she will occupy the Home as his or her principal place of residence throughout his or her ownership. (2) Agreement to Sign buyer's Resale Agreement and to Cooperate with Coup The Proposed Purchaser shall agree to sign a buyer's resale agreement restricting future resale of the Home and shall agree to cooperate fully with the County in promptly providing all information requested by the County to assist the County in monitoring the Proposed Purchaser's compliance with the buyer's resale agreement. (3) Income-Eligibility. The combined maximum income for all household members of the Proposed Purchaser shall not exceed one hundred twenty percent (120%) of the median yearly income, adjusted for household size, for a household in Contra Costa County as published by the California Department of Housing and Community Development("HCD") pursuant to Health and Safety Code Section 50093. In the event such income determinations are no longer published by HCD, or are not updated for a period of at least eighteen (1 S)months,the County shall provide other income determinations which are reasonably similar with respect to method of calculation to those previously published by HCD. The income of a household shall be calculated in accordance with 25 California Code of Regulations Section 6914 or a successor state housing regulation that sets forth a method of calculation of household income. 863/305/1 23603.4 11/23/99 9 C. Maximum Sales Price. The purchase price for the sale of the Home by the Owner to the Eligible Purchaser shall not exceed the Maximum Sales Price calculated by the County pursuant to Section 11 above, as set forth in the First County Response Notice. D. Disclosure and Submittals. The Owner and the Proposed Purchaser shall provide the following information and documents to the County: (1) The name, address and telephone number in writing of the Proposed Purchaser. (2) A signed financial statement of the Proposed Purchaser in a form acceptable to the County and any other supporting documentation requested by the County. The financial information shall be used by the County to determine the income eligibility of the Proposed Purchaser. (3) The proposed sales contract and all other related documents which shall set forth all the terms of the sale of the Home. Said documents shall include at least the following terms: (a)the sales price; and (b)the price to be paid by the Proposed Purchaser for the Owner's personal property, if any, for the services of the Owner, if any, and any credits, allowances or other consideration, if any. (4) A written certification, from the Owner and the Proposed Purchaser in a form acceptable to the County that the sale shall be closed in accordance with the terms of the sales contract and other documents submitted to and approved by the County. The certification shall also provide that the Proposed Purchaser or any other party has not paid and will not pay to the Owner, and the Owner has not received and will not receive from the Proposed Purchaser or any other party, money or other consideration, including personal property, in addition to what is set forth in the sales contract and documents submitted to the County. The written certification shall also include a provision that in the event a Transfer is made in violation of the terms of this Agreement or false or misleading statements are made in any documents or certification submitted to the County, the County shall have the right to foreclose on the Home or file an action at law or in equity as may be appropriate. In any event, any costs, liabilities or obligations incurred by the Owner and the Proposed Purchaser for the return of any moneys paid or received in violation of this Agreement or for any of the Owner's and/or the Proposed Purchaser's costs and legal expenses, shall be borne by the Owner and/or the Proposed Purchaser and they shall hold the County and its designee harmless and reimburse the County's and its designee's expenses, legal fees and costs for any action they reasonably take in good faith in enforcing the terms of this Agreement. (5) An executed buyer's resale agreement and deed of trust from the Proposed Purchaser in forms provided by the County. The recordation of the new deed of trust and buyer's resale agreement shall be a condition of the County's approval of the proposed sale. 863\341123603.4 11123193 10 (6) the name of the title company escrow holder for the sale of the Home,the escrow number, and name, address, and phone number of the escrow officer. (7) Upon the close of the proposed sale, certified copies of the recorded County deed of trust and buyer's resale agreement, a copy of the final sales contract, settlement statement, escrow instructions, and any other documents which the County may reasonably request. E. Failure To Locate Eligible Purchaser; Unrestricted Sale. If, despite bona fide good faith marketing efforts, the Owner is unable to locate an Eligible Purchaser during the Marketing Period and any extensions to the Marketing Period granted by the County, the Owner shall provide written notice to the County of this fact(the "Owner's Notice of Failure to Locate Eligible Purchaser"). Within fifteen (15) days of receipt of the Owner's Notice of Failure to Locate Eligible Purchaser, the County shall provide a second response notice to the Owner(the "Second County Response Notice") stating either(1)that the County will exercise the County Option to purchase the Home pursuant to Section 10, or(2)that the Owner may Transfer the Home to a person of the Owner's choosing(a "Market Purchaser")who is not an Eligible Purchaser, at an unrestricted price(supported by an MAI or other qualified appraisal), but shall pay all Excess Sales Proceeds to the County as set forth in Section 13 below. If the Owner Transfers the Home pursuant to this Section 12E, the purchaser shall not be required to execute a buyer's resale agreement, and the County shall reconvey the liens of this Agreement and the County Deed of Trust from the Home,provided that the Owner pays the Excess Sales Proceeds to the County pursuant to Section 13 below. The Owner shall provide the County with the following documentation associated with such a Transfer: (1) the name and address of the purchaser; (2) the final sales contract and all other related documents which shall set forth all the terms of the sale of the Home. Said documents shall include at least the following terms: (a)the sales price; and (b)the price to be paid by the Market Purchaser for the Owner's personal property, if any, for the services of the Owner, if any, and any credits, allowances or other consideration, if any. (3) a written certification, from the Owner and the Market Purchaser in a form acceptable to the County that the sale shall be closed in accordance with the terms of the sales contract and other documents submitted to and approved by the County. The certification shall also provide that the Market Purchaser or any other party has not paid and will not pay to the Owner, and the Owner has not received and will not receive from the Market Purchaser or any other party, money or other consideration, including personal property, in addition to what is set forth in the sales contract and documents submitted to the County. The written certification shall also include a provision that in the event a Transfer is made in violation of the terms of this Agreement or false or misleading statements are made in any documents or certification submitted to the County, the County shall have the right to foreclose on the Home or file an action at law or in equity as may be appropriate. In any event, any costs, liabilities or obligations incurred by the Owner and the Market Purchaser for the return of any moneys paid or received in violation of this Agreement or for any costs and legal expenses, shall be borne by the Owner 863130\123503.4 111!23/99 and/or the Market Purchaser and they shall hold the County and its designee harmless and reimburse their expenses, legal fees and costs for any action they reasonably take in good faith in enforcing the terms of this Agreement. (4) a copy of the MAI or other qualified appraisal for the Home. (5) upon the close of the proposed sale, a copy of the final sales contract, settlement statement, escrow instructions, and any other documents which the County may reasonably request. 13. PAYMENT TO COUNTY OF EXCESS SALES PROCEEDS If the Owner Transfers the Horne at an unrestricted price pursuant to Section 12E above, or if the Owner makes a Transfer in violation of this Agreement, the Owner shall pay the Excess Sales Proceeds to the County. For purposes of this Agreement, "Excess Sales Proceeds" shall mean ninety-four percent(94%) of the amount by which the gross sales proceeds received by the Owner from the new purchaser exceed the Maximum Sales Price for the Home (in the amount that was stated in the First County Response Notice). This amount shall be a debt of the Owner to the County, secured by the County.Deed of Trust. The Owner acknowledges that the County shall have no obligation to cause reconveyance of this Agreement or of the County Deed of Trust until the Excess Sales Proceeds are paid to the County. The County shall utilize the Excess Sales Proceeds for County affordable housing programs. The Owner and the County acknowledge that the formula for calculation of the amount of Excess Sales Proceeds due from the Owner to the County is intended to cause the Owner to receive the same net sales proceeds (following payment by Owner of a standard broker's commission) from sale of the Home at an unrestricted price to an Market Purchaser as the Owner would receive from sale of the Home to the County or to an Eligible Purchaser at the Maximum Sales Price. 14. DEFAULTS A. The following events shall constitute a Default by the Owner under this Agreement: (1) The County determines that the Owner has made a misrepresentation to obtain the benefits of purchase of the Home or in connection with its obligations under this Agreement, (2) The Owner fails to owner occupy the home, as required pursuant to Section 3 above, and such failure continues following written notice by the County and sixty(60) days opportunity to cure following the date of such notice. (3) The Owner makes a Transfer in violation of this Agreement; 663\30\1236£33.4 31/23/99 12 (4) The Owner otherwise fails to comply with the requirements of this Agreement and such violation is not corrected to the satisfaction of the County within ten (10) days after the date of written notice by the County to the Owner of such violation, or (5) A notice of default is issued under First Mortgage Loan or other financing secured by the Horne. (6) A lien is recorded against the Home other than the lien of a bone fide mortgage loan. B. Upon a declaration of Default by the County under this Agreement, the County may: (1) Declare all Excess Sales Proceeds immediately due and payable without further demand and may invoke the power of sale under the County Deed of Trust; (2) Apply to a court of competent jurisdiction for such relief at law or in equity as may be appropriate; (3) Declare a Default under the County Deed of Trust and pursue all County remedies under the County Deed of Trust; and (4) Exercise the County Purchase Caption Upon Default as described in Section 16 below. 15. NOTICE OF DEFAULT AND FORECLOSURE A request for notice of default and any notice of sale under any deed of trust or mortgage with power of sale encumbering the Home shall be recorded by the County in the Office of the Recorder of the County of Contra Costa for the benefit of the County. The County may declare a Default under this Agreement upon receipt of any notice given to the County pursuant to Civil Code Section 2924b, and may exercise its rights as provided in Sections 14 and 16. In the event of default and foreclosure, the County shall have the same right as the Owner to cure defaults and redeem the Home prior to the foreclosure sale. Nothing herein shall be construed as creating any obligation of the County to cure any such default, nor shall this right to cure and redeem operate to extend any time limitations in the default provisions of the underlying deed of trust or mortgage. If the County failed to file the request for notice of default, the CountyEs right to purchase the Home shall commence from the date a notice of default is given by the County to the Owner. 863;30\123603.4 11/23/99 13 16. .PURCHASE OPTION UPON DEFAULT Notwithstanding, and in addition to,the remedies provided the County in Section 14, and the County Option provided to the County in Section 10, the Owner hereby grants to the County the option to purchase the Home following written notice by the County to the Owner of the declaration of a Default by the County under this Agreement. This option to purchase is given in consideration of the economic benefits received by the Owner resulting from ownership of the Home made possible by the County's Density Bonus Program. The County shall have thirty(30)days after a Default is declared to notify the Owner and the First Lender of its decision to exercise its option to purchase under this Section 16. Not later than ninety(90) days after the notice is given by the County to the Owner of the County's intent to exercise its option under this Section 16,the County shall purchase the Home for the Maximum Sales Price calculated in the manner set forth in Section 11. 17. NONLUBILITY OF THE COUNTY A. No Obligation to Exercise Option. The County shall have no obligation to exercise any option granted it under this Agreement. In no event shall the County become in any way liable or obligated to the Owner or any successor-in-interest to the Owner by reason of its option to purchase under Sections 10 and 16 nor shall the County be in any way obligated or liable to the Owner or any successor-in-interest to the Owner for any failure to exercise its option to purchase. B. Nonliability for Negligence. Loss. or Damage. Owner acknowledges, understands and agrees that the relationship between Owner and the County is solely that of an owner and an administrator of a County density bonus program, and that the County does not undertake or assume any responsibility for or duty to Owner to select, review,inspect, supervise, pass judgment on, or inform Owner of the quality, adequacy or suitability of the Home or any other matter. The County owes no duty of care to protect Owner against negligent, faulty, inadequate or defective building or construction or any condition of the Home and Owner agrees that neither fawner, or Owner's heirs, successors or assigns shall ever claim, have or assert any right or action against the County for any loss,damage or other matter arising out of or resulting from any condition of the Home and will hold the County harmless from any liability, loss or damage for these things. C. Indemnity. Owner agrees to defend, indemnify, and hold the County and the Contra Costa County Redevelopment Agency(Agency")harmless from all losses, damages, liabilities, claims, actions,judgments, costs, and reasonable attorneys fees that the County or Agency may incur as a direct or indirect consequence of: (1)Owner's default,performance, or failure to perforin any obligations as and when required by this Agreement or the Deed of Trust; or(2)the failure at any time of any of Owner's representations to the County to be true and correct. 663\30\123603.4 11123105 14 18. RESTRICTIONS ON FORECLOSURE PROCEEDS If a creditor acquires title to the Home through a deed in lieu of foreclosure, a trustee's deed upon sale, or otherwise,the Owner shall not be entitled to the proceeds of sale to the extent that such proceeds otherwise payable to the Owner when added to the proceeds paid or credited to the creditor exceed the Maximum Sales Price. The Owner shall instruct the holder of such excess proceeds to pay such proceeds to the County in consideration of the benefits received by the Owner through purchase of the Hoare under the County's Density Bonus Program. 19. RESTRICTION ON INI SURANCE PROCEEDS If the Hoare is damaged or destroyed and the Owner elects not to rebuild or repair the Home,the Owner shall pay the County the portion of any insurance proceeds received by the Owner for such destruction or damage which is in excess of the Maximum Sales Price calculated pursuant to Section 11 above. 20. TERM OF AGREEMENT All the provisions of this Agreement, including the benefits and burdens, run with the Home and this Agreement shall bind, and the benefit hereof shall inure to,the Owner, his or her heirs, legal representatives, executors, successors in interest and assigns, and to the County and its successors,until the earlier of(i) fifteen(15) years from the date of purchase of the Home by Owner, or(ii)the date of Transfer of the Home to the County or another purchaser in compliance with this Agreement. 21. SUPERIORITY OF AGREEMENT The Owner covenants that he or she has not, and will not, execute any other agreement with provisions contradictory to or in opposition to the provisions hereof, and that, in any event, this Agreement is controlling as to the rights and obligations between and among the Owner, the County and their respective successors. 22. SUBORDLNIATION Notwithstanding any provision herein,this Agreement shall not diminish or affect the rights of the First Lender under the First Lender Deed of Trust or any subsequent First Leader deeds of trust hereafter recorded against the Home in compliance with Section 22 of this Agreement. Notwithstanding any other provision hereof, the provisions of this Agreement and the County Beed of Trust shall be subordinate to the lien of the First Lender Deed of Trust and shall not impair the rights of the First Lender, or.such lender's assignee or successor in interest, to 883\3MI23603.4 11/23/99 15 exercise its remedies under the First Lender Deed of Trust in the event of default under the First Lender Deed of Trust by the Owner. Such remedies under the First Lender Deed of Trust include the right of foreclosure or acceptance of a deed or assignment in lieu of foreclosure. After such foreclosure or acceptance of a deed in lieu of foreclosure, this Agreement and the County Deed of Trust shall be forever terminated and shall have no further effect as to the Home or any transferee thereafter; provided, however, if the holder of such First Lender Deed of Trust acquires title to the Horne pursuant to a deed or assignment in lieu of foreclosure, this Agreement and the County Deed of Trust shall automatically terminate upon such acquisition of title, only if (i)the County has been given written notice of default under such First Lender Deed of Trust with a sixty(60) day cure period and(ii)the County shall not have cured the default within such 60-day period or commenced to cure and given its firm commitment to complete the cure in form and substance acceptable to the First Lender. 23. REFINANCE OF FIRST MORTGAGE LOAN The County agrees to subordinate this Agreement and the County Deed of Trust to a deed of trust securing a refinanced First Mortgage Loan provided that, following such refinance,the principal amount of all debt secured by the Home will not exceed ninety percent(90%) of the :Maximum Sales Price determined in accordance with Section 11 above. 24. NONDISCRIMLVATION The Owner covenants by and for itself and its successors and assigns that there shall be no discrimination against or segregation of a person or of a group of persons on account of race, color,religion, creed, age, disability, sex, sexual orientation, marital status, ancestry or national origin in the sale,transfer,use,occupancy, tenure or enjoyment of the Horne,nor shall the Owner or any person claiming under or through the Owner establish or permit any such practice or practices of discrimination or segregation with reference to the use, occupancy, or transfer of the Home. The foregoing covenant shall run with the land. 25. RIGHTS OF BENEFICIARIES UNDER DEEDS OF TRUSTS This Agreement shall not diminish or affect the rights of the County under the County Deed of Trust. Notwithstanding any other provision in this Agreement to the contrary,this Agreement shall not diminish or affect the rights of the California Housing Finance Agency("CHFA"), United States Department of Housing and Urban Development("HUD"), the Federal National Mortgage Association("FNMA"), or the Veterans Administration("VA")under the First Mortgage Deed of Trust or any subsequent First Lender deeds of trust hereafter recorded against the Home in compliance with Section 23 above. 863\30\123603.4 11/23/99 16 Notwithstanding any other provisions in this Agreement to the contrary, all of the provisions of this Agreement shall terminate and have no further force and effect upon the occurrence of one of the following events: A. Title is acquired by CHFA, HUD, FNMA, VA, the First Lender or another party upon foreclosure of a deed of trust to the First Lender or CHFA, or a deed of trust insured by HUD or guaranteed by VA. B. Title is acquired by another party by a deed in lieu of foreclosure of the First Lender, CHFA, or FNMA deed of trust. 26. HUD FORBEARANCE RELIEF Notwithstanding other provisions of this Agreement, the County Option on Default pursuant to Section 16 above shall not be exercised by the County when a deed of trust insured by HUD is secured by the Home, and: (i)the owner is undergoing consideration by HUD for assignment forbearance relief; or(ii)the owner is undergoing consideration for relief under HUD's Temporary Mortgage Assistance Payment(TMAP)program. 27. INVALID PROVISIONS If any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect,then such provision or provisions shall be deemed severable from the remaining provisions contained in this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. 28. CONTROLLING LAW The terms of this Agreement shall be interpreted under the laws of the State of California. The venue for any legal action pertaining to this Agreement shall be Contra Costa County, California. 29. NO WAIVED. No delay or omission in the exercise of any right or remedy of County upon any default by Owner shall impair such right or remedy or be construed as a waiver. The County's failure to insist in any one or more instance upon the strict observance of the terms of this Agreement shall not be considered a waiver of the County's right thereafter to enforce the provisions of the Agreement. The County shall not waive its rights to enforce any provision of this Agreement unless it does so in writing, signed by an authorized agent of the County. 863130\123603.4 11123!99 17 30, NOTICES All notices required herein shall be sent by certified mail, return receipt requested or express delivery service with a delivery receipt and shall be deemed to be effective as of the date received or the date delivery was refused as indicated on the return receipt as follows: To the Owner: At the address of the Home. To the County: Contra Costa County Redevelopment County 65I Fine Street, 4th Floor,North Wing Martinez, CA 94553 Attn: Deputy Director- Redevelopment The parties may subsequently change addresses by providing written notice of the change in address to the other parties in accordance with this Section. 31, INTERPRETATION OF AGREEMENT The terms of this Agreement shall be interpreted so as to avoid speculation on the Home and to insure to the extent possible that its sales price and mortgage payment remain affordable to persons and families of moderate income. 32. EXHIBITS Any exhibits referred to in this Agreement are incorporated in this Agreement by such reference. IN WITNESS WHEREOF,the parties have executed this Agreement on or as of the date first written above. COU'VTY: OWNER: By: Title: (Type Name and Title) (Type Name) 863\30\123603.4 11123/99 18 EXHIBIT A (Legal Description of the Home) 863\300123603.4 11123199 A-1 STATE OF CALIFORNIA } ) ss COUNTY OF CONTRA COSTA ) On , 20, before me, , personally appeared personally known to me(or proved to me on the basis of satisfactory evidence)to be the person(s)whose name(s)is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/leer/their authorized capacity(ies), and that by his/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. STATE OF CALIFORNIA ) )ss COUNTY OF CONTRA COSTA ) On , 20—,before me, ,personally appeared personally known to me(or proved to e on the basis of satisfactory evidence)to be the person(s)whose name(s) is/are subscribed to the within instrument and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies),and that by his/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. 86MM123603.4 1112W99