14-139 Regulatory Agreement and Declaration Restrictive Covenants (CDBGGrant-Le Beaulieu) OFFICE OF THE CITY CLERK
CITY HALL
10300 TORRE AVENUE •CUPERTINO, CA 95014-3255
TELEPHONE: (408)777-3223• FAX: (408)777-3366
C lJ P E RT I N® WEBSITE:www.cupertino.org
August 7, 2014
Mid-Penn
Attention: Matthew Louis
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Re: Community Development Block Grant ((:DBG) Program City/Non-Profit Capital
Housing Project contract. Regulatory agreerrLent and Declaration of Restrictive
Covenants-Le Beaulieu Apartments. CDBG Grant Agreement-Le Beaulieu Apartments.
A fully executed copy of the agreements for consultant services with the City of
Cupertino is enclosed. If you have any questions or need additional information, please
contact the Community Development Department at (408) 777-3308.
Sincerely,
Andrea Sanders
Senior Office Assistant
City Clerk's Office
Enclosure
cc: Community Development
RECORDING REQUESTED BY
AND WHEN RECORDED MAIL TO:
City of Cupertino
Community Development Department
10300 Torre Avenue
Cupertino, CA 9.5014
Attn: Senior Housing Planner
No fee for recording pursuant to
Government Code Section 27383
REGULATORY AGREEMENT AND
DECLARATION OF RE�►TRICTIVE COVENANTS
(CDBG Grant- Le Beaulieu Apartments)
This Regulatory Agreement and Declaration of Restrictive Covenants (the "Agreement")
is made and entered into as of July 1, 2014, by and between the City of Cupertino, a municipal
corporation("City"), and Cupertino Community Housing for the Disabled, Inc., a California
nonprofit public benefit corporation("Owner").
RECITALS
A. This Agreement is entered into pursuant to the Grant Agreement (as defined in
Section 1.1 below), entered into as part of Owner's rehabilitation of the real property located at
10092 Bianchi Way, Cupertino, as more particularly described in Exhibit A attached here to (the
"Property"). The Property is improved with improved with a twenty-seven(27) units of
multifamily rental housing in seven(7) separate buildings, commonly referred to as the Le
Beaulieu (the "Development"). The Owner intends on rehabilitating fifteen(15) of the units of
multifamily rental housing and to snake specified improvements to the exterior and common
areas of the Development to address security, accessibility, and safety concerns. Capitalized
terms used but not defined in this Agreement shall have the meanings set forth in the Grant
Agreement.
B. As set forth in the Grant Agreement, the rehabilitation of the Development is
being funded utilizing the proceeds of funds received by the City from the United States
Department of Housing and Urban Development("HUD") under the Community Development
Block Grant("CDBG") program.
C. The City entered into the Grant Agreement with Owner on the condition that the
Development be maintained and operated in accordance with restrictions concerning
affordability, operation, and maintenance of the Development that are set forth in this Agreement
and in the Grant Agreement.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
I
D. In consideration of the Grant Agreement, Owner agrees to observe all-the terms
and conditions set forth below.
E. THEREFORE, City and Owner hereby agrees as follows.
ARTICLE 1
DEFINITIONS
1.1 Definitions.
When used in this Agreement, the following terms shall have the respective meanings
assigned to them in this Article 1.
(a) "Assumed Household Siz(;" means the actual number of persons in the
applicable household.
(b) "Adjusted Income" mean,the total anticipated annual income of all
persons in the Tenant household as calculated in accordance with 24 C.F.R. Section 5.611.
(c) "CDBG" means the Community Development Block Grant program under
Title I of the Housing and Community Development Act of 1974 (42 U.S.C. 5301 et. seq.), as
amended.
(d) "CDBG Grant" means the.financing provided to the Owner by City
pursuant to the Grant Agreement.
(e) "CDBG Regulations" means the statutory and regulatory provisions that
govern the CDBG program under Title I of the Housing and Community Development Act of
1974 (42 U.S.C. 5301 et. sew.), as amended including 24 C.F.R. Part 570 et seq.
(f) "City-Assisted Units" means seven (7) units on the Property designated as
assisted by the City.
(g) "Development" has the meaning set forth in Recital A.
(h) "Grant Agreement" means the Grant Agreement between Owner and City,
dated of even date herewith, evidencing the Grant.
(i) "HUD" has the meaning set forth in Recital B.
0) "Median Income" means-the median gross yearly income, adjusted for
Actual Household Size as specified herein, in-the Santa Clara County, California, as published
from time to time by HUD. In the event that such income determinations are no longer
published, or are not updated for a period of at least eighteen(18) months, the City shall
provide the Owner with other income determinations which are reasonably similar with respect
to methods of calculation to those previously published by HUD.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
(k) "Official Records" means the official land records of the County of Santa
Clara, Catifornia.
(1) "Property" has the meaning set forth in Recital A.
(m) "Rent" means the total of monthly payments by the Tenant of a City-
Assisted Unit for the following: use and occupancy of the City-Assisted Unit and land and
associated facilities, including parking; any sel')arately charged fees or service charges assessed
by Owner which are required of all Tenants, other than security deposits; an allowance for the
cost of an adequate level of service for utilities,paid by the Tenant, including garbage
collection, sewer, water, electricity, gas and other heating, cooking and refrigeration fuel, but
not telephone service or cable television; and C1ny other interest, taxes, fees or charges for use
of the land or associated facilities and assessed by a public or private entity other than Owner,
and paid by the Tenant.
(n) "Tenant" means a household legally occupying a City-Assisted Unit.
(o) "Term" means the teen of this Agreement which commences as of the
date this Agreement is recorded in the Official Records and ends on the twentieth(20th)
anniversary thereof.
(p) "Very Low Income Household" means a Tenant household with an
Adjusted Income that does not exceed fifty percent (50%)of Median Income, with adjustments
for smaller and larger families, except that HUD may establish income ceilings higher or lower
than fifty percent(50%) of Median Income on,the basis of HUD findings that such variations
are necessary because of prevailing levels of construction costs or fair market rents, or
unusually high or low family incomes.
(q) "Very Low Income Rent" shall mean the maximum allowable rent for a
Very Low Income Unit pursuant to Section 2.t(a) below.
(r) "Very Low Income Units" shall mean the City-Assisted Units which,
pursuant to Section 2.2(a) below, are required to be occupied by Very Low Income
Households.
ARTICLE 2
AFFORDABILITY AND OCCUPANCY COVENANTS
2.1 Occupancy Requirements.
All of the City-Assisted Units shall be rented to and occupied by or, if vacant, available
for occupancy by Very Low Income Households. At initial occupancy, affordability by bedroom
type shall be met in accordance with the following:
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
Unit Size Very Low
Income
1 Bedroom 5
2 Bedroom 2
Total 7
Owner agrees to use its best efforts to maintain the distribution shown in the above chart for the
Term of this Agreement.
2.2 Allowable Rent.
(a) Very Low Income Rent. The Rent paid by Tenants of the Very Low
Income Units shall not exceed thirty percent (30%) of fifty percent (50%) of Median Income
("Very Low Income Rent").
2.3 Increased Incomes of Tenant.
(a) Non- ualifying Household. If, upon recertification of the income of a
Tenant,the Owner determines that a former Very Low Income Household has an Adjusted
Income exceeding the maximum qualifying income for a Very Low Income Household, such
Tenant shall be permitted to continue occupying the Unit and, upon expiration of the Tenant's
lease and upon sixty (60) days written notice, the. Rent shall be increased to the lesser of one-
twelfth(1/12th) of thirty percent (30%) of the actual Adjusted Income of the Tenant, or fair
market rent. Owner shall not be required to evict an otherwise qualified household due to an
increase in household income above the limit set:forth herein for a Very Low Income Household.
When the Tenant vacates the Unit the Owner shall rent the Unit to a Very Low Income
Household to comply with the requirements of Section 2.1 above.
(b) Termination of Tenancy. Upon termination of occupancy of a City-
Assisted Unit by a Tenant, such City-Assisted Unit shall be rented to Very Low Income
Household, or a Low-Income Household, as applicable, to comply with the requirements of
Section 2.1 above.
2.4 Units Available to the Disabled. In compliance with Section 504 of the
Rehabilitation Act of 1973 (29 USC 794 et. seq.'), City-Assisted Units shall to the maximum
extent feasible be accessible to and usable by in(li.viduals with handicaps.
ARTICLE 3
INCOME CERTIFICATION AND REPORTING
3.1 Income Certification.
Owner will obtain, complete, and maintain on file, annual income certifications from
each Tenant renting any of the City-Assisted Units. Owner shall make a good faith effort to
verify the accuracy of the income provided by the applicant or occupying household, as the case
may be, in an income certification. To verify the. information, Owner shall take two or more of
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
the following steps: (i) obtain a pay stub for the most recent pay period; (ii) conduct a credit
agency or similar search; (iii) obtain an income verification form from the applicant's current
employer; (iv) obtain an income verification form from the Social Security Administration
and/or the California Department of Social Services if the applicant receives assistance from
either of such agencies or(v) if the applicant is unemployed and does not have a tax return,
obtain another form of independent verification. Owner shall also complete and/or have the
Tenants of the City-Assisted Units complete and sign the "Income Computation and
Certification" and the "Owner's Certification of Household Income" both of which are attached
hereto as Exhibit B and/or any other forms related to Tenants' income provided to Owner by the
City or that provide income information that is sufficient to determine an applicant's income as
required by this Section 3.1. Copies of Tenant income certifications shall be available to the City
upon request.
3.2 Reporting Requirements.
Owner shall submit to the City annual reports in a form approved by the City, no later
than one hundred twenty (120) days after the end of Owner's fiscal year. The reports shall
contain such information as the City may require-, including, but not limited to, the following:
(a) A statement of the fiscal condition of the Property, including a financial
statement indicating surpluses or deficits in operating accounts for the period covered, a
detailed itemized listing of income and expenses, and the amounts of any Property reserves.
The report due after the end of each fiscal year shall contain an audited version of this
statement. Such audit shall be prepared in accordance with the requirements of the City and
certified at the Owner's expense by an independent Certified Public Accountant licensed by the
State of California. The Owner shall also follow audit requirements of the Single Audit Act
and OMB Circulars A-122 and 110.
(b) The substantial physical defects in the Property, if any, including a
description of any major repair or maintenance work undertaken in the reporting period.
(c) The occupancy of the Property indicating:
(1) A listing of current Tenants' names, income levels, rent charged
and paid, move-in dates, and the race and ethnic groups of Tenants;
(2) General management performance, including Tenant relations and
other relevant information.
Upon request of the City, Owner shall fumish, within fifteen(15) days, copies of all
Tenant agreements for the City-Assisted Units. Within fifteen (15) days after receipt of a written
request from the City, Owner shall also submit any other information or completed forms
requested by the City in order to comply with re]')orting requirements of HUD, (provided,
however, that the Owner shall in no event be obligated to provide any information that it cannot
legally obtain as a housing provider), the State of California, or any other government entity or
lender to Owner.
FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDEG Regulatory Agreement and Declaration of Restrictive Covenants
3.3 Additional Information.
Owner shall provide any additional information reasonably requested by the City. The
City shall have the right to examine and make copies of all books, records or other documents of
Owner which pertain to the Property.
3.4 Records.
Owner shall maintain complete, accurate and current records pertaining to the Property
and all those records set forth in the Grant Agreement, and shall permit any duly authorized
representative of the City to inspect records, including records pertaining to income and
household size of Tenants. All Tenant lists, applications and waiting lists relating to the
Development shall at all times be kept separate C-Lnd identifiable from any other business of
Owner and shall be maintained as required by the City, in a reasonable condition for proper audit
and subject to examination during business hours by representatives of the City. Owner shall
retain copies of all materials obtained or produced with respect to occupancy of the City-Assisted
Units for a period of at least five (5) years.
3.5 On-site Inspection.
The City shall have the right to perfonn yin on-site inspection of the Property when
deemed necessary by the City, and subject to the rights of the Tenants, at least one (1) time per
year upon reasonable notice to the Owner. Owner agrees to cooperate in such inspection and
request Tenants cooperate with such inspections.
ARTICLE 4
OPERATION OF THE PROPERTY
4.1 Residential Use.
Owner shall operate the Development as rental multifamily affordable housing in
accordance with Article 2 of this Agreement. The Development shall be operated only for
residential use. No part of the Property may be operated as transient housing.
4.2 Compliance with Grant Agreement.
Owner shall comply with all the terms and provisions of the Grant Agreement.
4.3 Taxes and Assessments.
Owner shall pay all real and personal property taxes, assessments and charges and all
franchise, income, employment, old age benefit, withholding, sales, and other taxes assessed
against it or payable by it, at such times and in such manner as to prevent any penalty from
accruing, or any lien or charge from attaching to the Property; provided, however, that Owner
shall have the right to contest in good faith, any such taxes, assessments, or charges. In the event
Owner exercises its right to contest any tax, assessment, or charge against it, Owner, on final
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
determination of the proceeding or contest, shall immediately pay or discharge any decision or
tdgment rendered against it, together with all costs, charges and interest.
4.4 Property Tax Exemption.
Owner shall not apply for a property tax exemption for the Property under any provision
of law except California Revenue and Taxation ;)ection 214(8), without the prior written consent
of the City.
4.5 Tenant Selection Plan.
Tenant selection shall be conducted in conformance with HUD guidelines.
ARTICLE 5
PROPERTY MANAGEMENT AND MAINTENANCE
5.1 Management Responsibilities.
The Owner is responsible for all management functions with respect to the Development
and Property, including without limitation the selection of Tenants, certification and
recertification of household size and income, evictions, collection of rents and deposits,
maintenance, landscaping, routine and extraordinary repairs, replacement of capital items, and
security. The City shall have no responsibility over management of the Development and
Property. The Owner shall retain a professional property management company approved by the
City in its reasonable discretion to perform its management duties hereunder.
5.2 Management Agent; Periodic Reports.
The Property shall at all times be managed by an experienced management agent
reasonably acceptable to the City, with demonstrated ability to operate residential facilities like
the Property in a manner that will provide decent, safe, and sanitary housing (as approved, the
"Management Agent"). The Owner shall submit:for the City's approval the identity of any
proposed Management Agent and if applicable, the management agreement between Owner and
the Management Agent (the "Management Agreement"). The Owner shall also submit such
additional information about the background, experience and financial condition of any proposed
management agent as is reasonably necessary for the City to determine whether the proposed
management agent meets the standard for a qualified management agent set forth above. If the
proposed management agent meets the standard for a qualified management agent set forth
above, the City shall approve the proposed management agent by notifying the Owner in writing.
Unless the proposed management agent and proposed management agreement is disapproved by
the City within thirty(30) days, which disapproval shall state with reasonable specificity the
basis for disapproval, it shall be deemed approved.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
5.3 Periodic Performance Review.
The City reserves the right to conduct an annual (or more frequently, if deemed necessary
by the City) review of the management practices and financial status of the Property. The
purpose of each periodic review will be to enable.the City to determine if the Property is being
operated and managed in accordance with the requirements and standards of this Agreement.
The Owner shall cooperate with the City in such reviews.
5.4 Replacement of Management Agf;nt.
If, as a result of a periodic review, the City determines in its reasonable judgment that the
Property is not being operated and managed in accordance with any of the material requirements
and standards of this Agreement, or, if applicable, the Management Agreement,the City shall
deliver notice to Owner of its detennination that the Property does not satisfy the requirements of
this Agreement, such notice may include a request to cause replacement of the Management
Agent, including the reasons therefor. Within fifteen (15) days after receipt by Owner of such
written notice, City staff and the Owner shall meet in good faith to consider methods for
improving the financial and operating status of the Property, including, without limitation,
replacement of the Management Agent.
If, after such meeting and not less than thirty (30) days opportunity to cure, City staff
recommends in writing the replacement of the Management Agent, Owner shall promptly
dismiss the current Management Agent(subject-to any applicable notice and cure periods in the
Management Agreement or this Agreement), and shall appoint as the Management Agent a
person or entity meeting the standards for a management agent set forth in Section 5.2 above and
approved by the City pursuant to Section 5.2 above.
Any contract for the operation or management of the Property entered into by Owner
shall provide that the Management Agent may be. dismissed and the contract terminated as set
forth above. Failure to remove the Management Agent in accordance with the provisions of this
Section shall constitute default under this Agreement, and the City may enforce this provision
through legal proceedings as specified in Section 6.8 below.
5.5 Approval of Management Policies.
The Owner shall submit its written management policies with respect to the Property to
the City for its review, and shall amend such policies in any way necessary to ensure that such
policies comply with the provisions of this Agreement.
5.6 Property Maintenance.
The Owner shall, for the entire Term of this Agreement, maintain all interior and exterior
improvements, including landscaping, on the Property in good condition and repair (and, as to
landscaping, in a healthy condition) and in accordance with all applicable laws, rules,
ordinances, orders and regulations of all federal, state, county, municipal, and other
governmental agencies and bodies having or claiming jurisdiction and all their respective
FY 2014-15 Cupertino Conmuinity Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
departments, bureaus, and officials, and in accordance with the following maintenance
conditions:
The Owner shall, for the entire Term of this Agreement, maintain all interior and exterior
improvements, including landscaping, on the Property in good condition and repair (and, as to
landscaping, in a healthy condition) and in accordance with all applicable laws, rules,
ordinances, orders and regulations of all federal, state, county, municipal, and other
governmental agencies and bodies having or claiming jurisdiction and all their respective
departments, bureaus, and officials, and in accordance with the following maintenance
conditions:
(a) Landscaping. The Owner shall have landscape maintenance performed on
a regular basis, including replacement of dead or diseased plants with comparable plants. Owner
agrees to adequately water the landscaping on th,, Property. No improperly maintained
landscaping on the Property is to be visible from public streets and/or rights of way;
(b) Yard Area. Owner shall not leave any yard areas on the Property
unmaintained, including:
(1) broken or discarded furniture, appliances and other, household
equipment stored in yard areas for a period exceeding one (1) week;
(2) packing boxes, lumber trash, dirt and other debris in areas visible
from public property or neighboring properties; and
(3) vehicles parked or stored in other than approved parking areas.
(c) . The Owner shall not leave any buildings located on the
Property in an unmaintained condition so.that any of the following exist:
(1) violations of state flaw, uniform codes, or City ordinances;
(2) conditions that constitute an unsightly appearance that detracts
from the aesthetics or value of the Property or constitutes a private or public nuisance;
(3) broken windows;
(4) graffiti (must be removed within 72 hours); and
(5) conditions constituting hazards and/or inviting trespassers, or
malicious mischief.
(d) Sidewalks. The Owner shall maintain, repair, and replace as necessary all
public sidewalks adjacent to the Development.
The City places prime importance on quality maintenance to protect its investment and to
ensure that all City-assisted affordable housing projects within the City are not allowed to
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
deteriorate due to below-average maintenance. Tlorinal wear and tear of the Property will be
acceptable to the City assuming the Owner agrees to provide all necessary improvements to
assure the Property is maintained in good condition. The Owner shall make all repairs and
replacements reasonably necessary to keep the improvements in good condition and repair.
In the event that the Owner breaches any of the covenants contained in this Section and
such default continues for a period of fifteen business (15) days after written notice from the City
with respect to graffiti, debris, waste material, and general maintenance or thirty (30) days after
written notice from the City with respect to landscaping and building improvements, then the
City, in addition to whatever other remedy it may have at law or in equity, shall have the right to
enter upon the Property and perform or cause to be performed all such acts and work necessary
to cure the default. Pursuant to such right of entry, the City shall be permitted (but is not
required)to enter upon the Property and perform.all acts and work necessary to protect,
maintain, and preserve the improvements and landscaped areas on the Property, and to attach a
lien on the Property, or to assess the Property, in the amount of the expenditures arising from
such acts and work of protection, maintenance, and preservation by the City and/or costs of such
cure, which amount shall be promptly paid by the Owner to the City upon demand.
(e) Safety Conditions. The Owner acknowledges that the City places a prime
importance on the security of City-assisted projects and the safety of the residents and
surrounding community. The Owner shall implement and maintain throughout the Term the
following security measures in the Development:
(1) to the extent feasible employ defensible space design principles
and crime prevention measures in the operation of the Development including, but not limited to,
maintaining adequate lighting in parking areas and pathways;
(2) use its best efforts to work with the City Police Department to
implement and operate an effective neighborhood watch program; and
(3) provide added security including dead-bolt locks for every entry
door, and where entry doors are damaged, replace them with solid-core doors.
(f) The City shall have the right to enter on the Property and/or contact the
City Police Department if it becomes aware of, or is notified of, any conditions that pose a
danger to the peace, health, welfare or safety of-i.he Tenants and/or the surrounding community,
and to perform, or cause to be performed, such acts as are necessary to correct the condition.
5.7 Asset Management.
The Owner is responsible for all asset management functions with respect to the Property,
including without limitation the oversight of the Management Agent, maintaining accurate and
current books and records for the Property and promptly paying costs incurred in connection
with the Property. The City shall have no responsibility over asset management of the Property.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CD13G Regulatory Agreement and Declaration of Restrictive Covenants
ARTICLE 6
MISCELLANEOUS
6.1 Lease Provisions.
In leasing the City-Assisted Units, Owner shall use a HUD approved lease form and
shall, among other matters:
(a) provide for termination of the lease and consent by the Tenant to
immediate eviction for failure: (i) to provide any information required under this Agreement
or reasonably requested by Owner to establish or recertify the Tenant's qualification, or the
qualification of the Tenant's household, for occupancy in the Property in accordance with the
standards set forth in this Agreement, or (ii) to qualify as a Very Low Income Household or a
Low Income Household as a result of any material misrepresentation made by such Tenant
with respect to the income computation.
(b) be for an initial tenn of not less than one (1) year, unless by mutual
agreement between the Tenant and Owner (and only if allowed by all financing sources), and
provide for no increase in Rent during such year. After the initial year of tenancy, the lease
may be month-to-month by mutual agreement of Owner and the Tenant.
6.2 Lease Termination.
Any termination of a lease or refusal to renew a lease for a City-Assisted Unit shall be in
conformance with the CDBG Regulations and shall be preceded by not less than sixty (60) days
written notice to the Tenant by the Owner specifying the grounds for the action.
6.3 Nondiscrimination.
(a) The Property shall be operated at all times in compliance with the
provisions of: (i)the Unruh Act; (ii) the California Fair Employment and Housing Act; (iii)
Section 504 of the Rehabilitation Act of 1973; (iv) the Fair Housing Act, as amended; and (v)
any other applicable law or regulation(including the Americans With Disabilities Act, to the
extent applicable to the Property). Owner shall agree to indemnify, protect, hold harmless and
defend (with counsel reasonably satisfactory to City) City, and its boardmembers, officers and
employees, from all suits, actions, claims, causes of action, costs, demands,judgments and
liens arising out of Owner's failure to comply with applicable legal requirements related to
housing for persons with disabilities. The provisions of this subsection will survive expiration
of the Tenn or other termination of this Agreement, and remain in full force and effect.
(b) All of the City-Assisted Units shall be available for occupancy on a
continuous basis to members of the general pul3lic who are income eligible. Owner shall not
give preference to any particular class or group of persons in renting or selling the City-
Assisted Units [other than disabled heads of households]. The Owner herein covenants by and
for Owner, assigns, and all persons claiming udder or through the Owner, that there shall be no
discrimination against or segregation of, any p(.rson or group of persons on account of race,
color, creed, religion, sex, sexual orientation, n:iarital status, national origin, source of income
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
(e.g., SSI), ancestry, or disability, in the leasing, subleasing,transferring, use, occupancy,
tenure, or enjoyment of any City-Assisted Unit:nor shall Owner or any person claiming under
or through Owner, establish or permit any such practice or practices of discrimination or
segregation with reference to the selection, location, number, use, or occupancy, of tenants,
lessees, sublessees, subtenants, or vendees of any City-Assisted Unit or in connection with the
employment of persons for the construction, operation and management of any City-Assisted
Unit. Notwithstanding the above, with respect to familial status, the above should not be
construed to apply to housing for older person, as defined in Section 12955.9 of the
Government Code and other applicable sections of the Civil Code as identified in Health and
Safety Code Section 33050(b).
(c) The Owner will accept as Tenants, on the same basis as all other
prospective Tenants, persons who are recipients of federal certificates for rent subsidies
pursuant to the existing housing program unde)c Section 8 of the United States Housing Act, or
its successor. The Owner shall not apply selection criteria to Section 8 certificate or voucher
holders that are more burdensome than criteria applied to all other prospective Tenants, nor
shall the Owner apply or permit the application of management policies or lease provisions
with respect to the Property which have the effect of precluding occupancy of City-Assisted
Units by such prospective Tenants.
6.4 Term.
The provisions of this Agreement shall apply to the Property for the entire Term even if
the entire Grant is repaid, or forgiven, in full prior to the end of the Tel-in. This Agreement shall
bind any successor, heir or assign of Owner, whether a change in interest occurs voluntarily or
involuntarily, by operation of law or otherwise, Except as expressly released by the City. The
City makes the Grant on the condition, and in consideration of, this provision, and would not do
so otherwise.
6.5 Compliance with the Grant Agreement and Program Requirements.
Owner's actions with respect to the Property shall at all times be in full conformity with:
(i) all requirements of the Grant Agreement all requirements imposed on projects assisted under
the CDBG Program as contained in the CDBG Regulations.
6.6 Notice of Expiration of Term.
(a) At least six (6) months prior to the expiration of the Term, Owner shall
provide by first-class snail, postage prepaid, a notice to all Tenants containing (i)the
anticipated date of the expiration of the Term, (ii) any anticipated increase in Rent upon the
expiration of the Term, (iii) a statement that a copy of such notice will be sent to the City, and
(iv) a statement that a public hearing may be held by the City on the issue and that the Tenant
will receive notice of the hearing at least fifteen(15) days in advance of any such hearing.
Owner shall also file a copy,of the above-described notice with the Housing Director of the
City.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
(b) In addition to the notice required above, Owner shall comply with the
requirements set forth in California Government Code Sections 65863.10 and 65863.11. Such
notice requirements include: (i) a twelve (12) month notice to existing tenants, prospective
tenants and Affected Public Agencies (as defined in California Government Code Section
65863.10(a), which would include the City Manager) prior to the expiration of the Term, (ii) a
six (6) month notice requirement to existing tenants, prospective tenants and Affected Public
Agencies prior to the expiration of the Term; (Hi) a notice of an offer to purchase the Property
to "'qualified entities" (as defined in California Government Code Section 65 863.11(d)), if the
Property is to be sold within five (5) years of the end of the Term; (iv) a notice of right of first
refusal within the one hundred eighty (180) day period that qualified entities may purchase the
Property.
6.7 Covenants to Run With the Land.
The City and Owner hereby declare their express intent that the covenants and
restrictions set forth in this-Agreement shall run with the land, and shall bind all successors in
title to the Property, provided, however, that on the expiration of the Tenn of this Agreement
said covenants and restrictions shall automatically expire. Each and every contract, deed or other
instrument hereafter executed covering or conveying the Property or any portion thereof, shall be
held conclusively to have been executed, delivered and accepted subject to such covenants and
restrictions, regardless of whether such covenants or restrictions are set forth in such contract,
deed or other instrument, unless the City expressly releases such conveyed portion of the
Property from the requirements of this Agreement. Notwithstanding the automatic expiration of
this Agreement set forth above, upon the expiration of the Term, the Parties hereby agree to
execute and record in the Official Records such document(s) as may be necessary to evidence the
termination and release of this Agreement as an encumbrance against the Property.
6.8 Enforcement by the City.
If Owner fails to perform any obligation under this Agreement, and fails to cure the
default within thirty (30) days after the City has notified Owner in writing of the default or, if the
default cannot be cured within thirty (30) days, jailed to coinrnence to cure within thirty (30)
days and thereafter diligently pursue such cure and complete such cure within ninety (90) days,
the City shall have the right to enforce this Agreement by any or all of the following actions, or
any other remedy provided by law:
(a) Revoking the Grant. The City may declare a default under the Grant
Agreement and, revoke the Grant. City and Owner agree and acknowledge that the
enforcement by the City of Owner's obligations to repay the Grant shall in no event constitute
the collection of, or enforcement of, monetary damages, and in the event of any conflict
between the requirements of this Section 6.8(a.) regarding Owner's obligation to repay the
Grant in accordance with the Grant Agreement, and the prohibition on the monetary damages
set forth in Section 6.8(b), the requirements of this Section 6.8(a) shall control.
(b) Action to Compel Performance. The City may bring an action at law or in
equity to compel Owner's performance of its obligations under this Agreement; and/or for
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
injunctive relief, provided, however, in no event shall the City be entitled to bring an action at
law or in equity for monetary damages due to Owner's breach or default under this Agreement.
(c) Special Remedy for Breach of Use Requirement. Pursuant to 24 C.F.R.
570.503(b)(7)(ii), if Owner substantially changes the use of the Property to a use that fails to
meet a national objective as defined in 24 C.F.R 570.208, City may require Owner to pay to
City the fair market value of the Property based on an appraisal. Such appraisal shall be
performed by an appraiser selected by the City and shall take into consideration the Owner's
new use of the Property (that is not permitted bly this Agreement). Funds recovered from
Owner pursuant to this subsection shall be credited: (1) by the City against any remaining
amount of the CDBG Grant. City and Owner agree and acknowledge that the payment of any
funds to City pursuant to this Section 6.8(c) shall in no event constitute the collection of, or
enforcement of, monetary damages, and in the event of any conflict between the requirements
of this Section 6.8(c), and the prohibition on the monetary damages set forth in Section 6.8(b),
above,the requirements of this Section 6.8(c) shall control.
6.9 Attorneys' Fees and Costs.
In any action brought to enforce this Agreement, the prevailing party shall be entitled to
all costs and expenses of suit, including reasonable attorneys' fees. This Section shall be
interpreted in accordance with California Civil Code Section 1717 and judicial decisions
interpreting that statute.
6.10 Recording and Filing.
The City and Owner shall cause this Agreement, and all amendments and supplements to
it, to be recorded in the Official Records. To the extent necessary, the City and the Owner shall
execute, and cause the recordation in the Official Records, of any additional document necessary
to evidence the termination and release of the Original Agreement as an encumbrance against the
Property.
6.11 Governing Law.
This Agreement shall be governed by the laws of the State of California.
6.12 Waiver of Requirements.
Any of the requirements of this Agreement may be expressly waived by the City in
writing, but no waiver by the City of any requirement of this Agreement shall, or shall be
deemed to, extend to or affect any other provision of this Agreement.
6.13 Amendments.
This Agreement may be amended only by a written instrument executed by all the parties
hereto or their successors in title, and duly recorded in the real property records of the City of
Alameda.
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CDBG Regulatory Agreement and Declaration of Restrictive Covenants
6.14 Notices.
Formal notices, demands, and conununications between the Parties shall be sufficiently
given if and shall not be deemed given unless dispatched by registered or certified mail, postage
prepaid, return receipt requested, or delivered by express delivery service, return receipt
requested, or delivered personally, to the principal office of the Parties as follows:
City: City of Cupertino
Community Development Department
10300 Torre Avenue
Cupertino, CA 95014
Attention: Senior Housing Planner
Owner : Cupertino Community Housing for the Disabled, Inc.
303 Vintage Park Drive, Suite 250
Foster City, CA 94404
Attention: Executive Director
Such written notices, demands and communications may be sent in the same manner to such
other addresses as the affected Party may from time to time designate by mail as provided in this
Section. Receipt shall be deemed to have occurs-ed on the date shown on a written receipt as the
date of delivery or refusal of delivery (or attempted delivery if undeliverable).
6.15 Severability.
If any provision of this Agreement shall'be invalid, illegal or unenforceable, the validity,
legality and enforceability of the remaining portions of this Agreement shall not in any way be
affected or impaired thereby.
6.16 Multiple Originals; Counterparts.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
6.17 Revival of Agreement after Foreclosure.
This Agreement shall be revived according to its original terms if, during the original
Tenn, the owner of record before the foreclosure, or deed in lieu of foreclosure, or any entity that
includes the former owner or those with whom the former owner has or had family or business
ties, obtains an ownership interest in the Property or Property.
6.18 Subordination.
This Agreement may be subordinated to one or more liens securing financing approved
by the City.
1.5
FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CD13G Regulatory Agreement and Declaration of Restrictive Covenants
_ i
6.19 Multiple Originals; Counterpart.
This Agreement may be executed in multiple originals, each of which is deemed to be an
original, and may be signed in counterparts.
WHEREAS, this Agreement has been entered into by the undersigned as of the date first
above written.
CITY:
CITY OF C�r'7 O, a mu icipal corporation
By:
David. Brandt, City Manager
APPROVED AS TO FORM
AND LEGALITY:
Carol Korade, City Attorney
ATTEST:
Grace Schmidt, City Clerk
OWNER:
CUPERTIT40 COMMUNITY HOUSING FOR THE
DISABLED, INC., a California nonprofit public benefit
corporation
By: VIVIIA1 7�471--'--Z�
. a' e . ra lin, ssistant Secretary
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FY 2014-15 Cupertino Community Housing For The Disabled,Inc.CD13G Regulatory Agreement and Declaration of Restrictive Covenants
STATE OF CALIFORNIA )
COUNTY OF
On AVj v-4- before me, e_vt ke_Ae Sq Uaf R , Notary:Public,
personally appeared PoLyi ck �mX I. who proved to me on the
basis of satisfactory evidence to be the person( ] whose nam0(9 are subsc 'bed to the within
instrument and acknowledged to met e she/they executed e same i his er/their
authorized capacity(ipf, and that by i /her/their signaturef K) on the instru ent the perso ice, or
the entity upon behalf of which the person�4 acted, executed the instrument.
I certify UNDER-PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
KIRSTEN RENEE SOUARCIA .
Commission# 1906898
Z �® Notary Public-California z
Santa Clara County >
Kotary Public
My Comm. Expires Oct 4, 2014
STATE OF CALIFORNIA )
COUNTY OF �CaJ_-zec7 )
On �9_q, o y/4 , before me, f'6 Re- iT't Notary Public,
personally Ippeared A Q/` f t 1.e,� r=v—a v kJ c." , who proved to me on the
basis of satisfactory evidence to be the person(s) whose name(s-) is/-ar-e subscribed to the within
instrument and acknowledged to me that he/sh-&they executed the same in. his/her-/their
authorized capacity(i-es-), and that by his/leer-4the r signature(s) on the instrument the person(s), or
the entity upon behalf of which the person(s) acted, executed the instrument.
I certify UNDER PENALTY OF PERJURY under the laws of the State of California that the
foregoing paragraph is true and correct.
WITNESS my hand and official seal.
CAROL PERRIG0
-� Commission # 1923993
Notary Public -California z U
z •` - D Notary Public
z � San Mateo County
' My Comm. Expires Feb 3, 2015
394\09\1495811.2
EXHIBIT A
LEGAL DESCRIPTION OF THE PROPERTY
The land referred to is situated in the County of�;anta Clara, City of Cupertino, State of
California, and is described as follows:
PARCEL ONE:
Beginning at a point on the east lisle of Stelling Road, distant thereon South 424.77 feet from the
intersection thereof with the Southerly line of a 30 foot strip of land conveyed by Southern
Pacific Company, a corporation to County of Santa Clara, by deed dated April 5, 1937 and
recorded December 7, 1937 in Book 853 of Official Records, Page 248, said point being the
Southwesterly corner of said land conveyed by Bank of America to Peter Bianchi by Deed dated
April 10, 1941 and recorded April 28, 1941 in Book 1038 of Official Records, Page 156; thence
along the Southerly line of said Bianchi parcel N. 89 deg. 57' 00 E. 143.50 feet to the true point
of beginning; thence continuing N. 89 deg. 57' 100" E. 323.45 feet; thence parallel with Stelling
Road North 252.77 feet; thence parallel with the Southerly line of said Bianchi parcel S. 89 deg.
57' 00" W. 159.95 feet; thence parallel with Stelling Road South 189.02 feet; thence parallel with
the Southerly line of said Bianchi parcel S. 89° deg. 57' 00" W. 163.50 feet; thence parallel with
Stelling Road South 63.75 feet to the true point: of beginning. Said parcel is also shown on the
Record of Survey filed March 27, 2006, in Book 798 of Maps, Page 44, Santa Clara County
Records.
PARCEL TWO:
A right of way for ingress and egress over that certain parcel of land 40 feet wide, the center line
of which is described as follows:
Beginning at a point in the Southerly line of the 30 foot strip of land conveyed by Southern
Pacific Company to the County of Santa Clara by Deed dated April 5, 1937 and recorded
December 7, 1937 in Vol. 853 of Official Records, Page 248, Santa Clara County Records, said
point of beginning being distant along said line; Easterly 20 feet from the Westerly line of the
parcel of land conveyed by the Bank of America to Peter.Bianchi by Deed dated April 10, 1941
and recorded April 28, 1941 in Vol. 1038 of Official Records, Page 156, Santa Clara County
Records; thence Southerly and parallel with said Westerly line and the Southerly prolongation
thereof, 424.77 feet to the Southerly line of said lands so conveyed to Bianchi.
APN's 359-07-010, 019 and 020
A-1
394\09\149811.2
EXHIBIT B ,
FORM INCOME COMPUTATION AND CERTIFICATION
AND OWNER'S CERTIFICATION OF HOUSEHOLD INCOME
I, the Undersigned, certify that I have read and answered fully, and truthfully each of the following
questions for all persons in the household who are to occupy a room in this house for which application
is made.
Occupant s Name Social Security# Age Place of Employment Annual Income
1.
2.
3.
4.
5.
6.
7.
TOTAL:
The total anticipated annual household income* for the twelve (12) month period
beginning this date (the sum of the final colunul): $
Signed: Date:
Head of Household
The anticipated annual Income as determined under 24 CFR 5.609(b) and (c), and as verified under
Attachrnent A .
B-1
394\09\1495811.2
ATTACHMENT A
Owner's Certification of Household Income
Household Name
I certify, as Owner/Management Agent fbr that I have
verified this Household's Income by using the following:
1. Tax returns
2. Place of employment verification
3. Pay stubs
4. Notarized statement from lessee
5. Other(please describe)
Owner/Management Agent
Date
B-2
394\09\1495811.2