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HomeMy WebLinkAboutContract 43332 (2)CITY SECRETARY CONiRAC7' NO. June 14, 2012 Tarrant County Housing Partnership 3204 Collinsworth Street Fort Worth, Texas 76107 Attention: Donna Van Ness, President Reference: Tarrant County Housing Partnership South Hemphill Heights Dear Ms. Van Ness: We are pleased to present for your review the following amended terms, conditions, and requirements based on the application of Tarrant County Housing Partnership, a Community Housing Development Organization ("CHDO"), for funding. SUMMARY OF TERMS City of Fort Worth will make a deferred payment loan to CHDO of up to $507,404.51 for the development of up to four single-family infill houses located within the South Hemphill Neighborhood ("Project"). The houses will be located at 3015 S. Adams, 2841 College Avenue, 2716 Travis Avenue, and 2708 S. Jennings Avenue (the "Sites") . The loan funds will be divided amongst the Sites, and CHDO agrees to execute a separate contract and loan documents for each Site. The terms outlined below will apply to each of the 4 contracts and 4 sets of loan documents. SUMMARY OF TERMS BORROWER Tarrant County Housing Partnership, Inc. ("TCHP") GUARANTORS N/A OFFICIAL RECORD CITY SECRETARY LENDER City of Fort Worth ("City") Ft WORTH, TX AMOUNT Up to $507,404.51 in HOME Investment Partnerships Program Grant funds for eligible construction and other development costs as defined in 24 CFR 92.206 ("Loan"). The Loan will be a deferred payment loan that will be forgivable if Borrower fulfills all conditions contained in the contract that must be executed between CHDO and City setting forth both parties' obligations for the Project ("Contract"). USE/PROJECT The project consists of the acquisition, rehabilitation and/or demolition, depending on the condition of the existing structures, plus new construction, if necessary, of up to four single-family -20-12 Al 0:3 i houses. The houses will be 3-bedrooms, 2-baths with rear detached garage ranging between 1200 and 1600 square feet. The house must be sold to a HOME -eligible homebuyer that earns at or below 80% of the Area Median Income ("AMI') as determined by the United States Department of Housing and Urban Development ( `HUD"). The house must be sold to an eligible buyer within 6 months of construction completion, or Borrower must repay all HOME funds to City. INTEREST RATE 0% DEVELOPER FEE TERM PAYMENT/ REPAYMENT DRAW PERIOD RECORDKEEPING Upon closing of the housing unit to an income eligible buyer, the CHDO will be paid a 10% developer fee based on the cost of construction, and the remaining proceeds will be returned to the City. 1. The term of the Loan is 2 years. 2. The term of the Contract is 1 year beginning on the date of Contract execution The term of the Contract requires completion of construction but does not require completion of the sale of the house to a HOME -eligible buyer The completed house must be insured and maintained and remain vacant while being actively marketed for sale 3. The Contract or the Loan terms may be extended for up to 6 months if Borrower requests an extension and Lender determines such extension is necessary to complete the Proj ect. Payment will be deferred through the Loan term. The Loan is forgivable if all conditions in the Contract are met. Borrower will be entitled to make requests for draws, on a reimbursable basis, during the Contract term. Draws will only be approved for HOME eligible costs in accordance with 24 CFR 92.206. Draws will occur as scheduled and defined in the Contract. City will disburse funds upon receipt of satisfactory documentation and due diligence satisfaction. Borrower must maintain records that will provide accurate, current, separate, and complete disclosure of the status of the funds received pursuant to the Contract and pursuant to any other applicable Federal and/or State regulations establishing standards for financial management. CLOSING COSTS Borrower will provide financial and beneficiary reports that will contain such records data and information as City may request pertinent to matters covered by the Contract. Required report format/template and /or instructions will be provided in the Contract. Borrower will provide any additional information as requested by the City within 10 days of date of receipt of written request. The Loan is to be closed at no cost to the City. Borrower shall be responsible for all costs associated with this transaction, including title insurance, attorney fees, filing fees, closing costs, etc. TITLE INSURANCE Borrower will pay the cost of a mortgagee's title insurance policy insuring the amount of the Loan. SUMMARY OF CONDITIONS CONDITIONS TO LOAN i. This Conditional Commitment does not constitute a FUNDING commitment of funds or site approval, and any commitment of funds or approval may occur only upon satisfactory completion of an environmental review and receipt by the City of a release of funds from HUD under 24 CFR Part 58. The parties further acknowledge that the provision of any funds to the Project is conditional on the City's determination to proceed with, modify or cancel the Project based on the results of a subsequent environmental review. ii. PARTIES ARE PROHIBITED FROM UNDERTAKING OR COMMITTING ANY FUNDS TO PHYSICAL OR CHOICE -LIMITING ACTIONS, INCLUDING PROPERTY ACQUISITION, DEMOLITION, MOVEMENT, REHABILITATION, CONVERSION, REPAIR OR CONSTRUCTION PRIOR TO THE COMPLETION OF ENVIRONMENTAL REVIEW AND RECIEPT OF THE RELEASE OF FUNDS FROM HUD. VIOLATION OF THIS PROVISION WILL RESULT IN THE, DENIAL OF FUNDS UNDER THIS CONDITIONAL COMMITMENT. A NOTICE TO PROCEED FROM THE CITY WILL BE ISSUED WHEN THE ENVIRONMENTAL CLEARANCE HAS BEEN RECEIVED. iii. Award of funds is conditioned upon City Council approval of award of HOME funds for the Project and receipt of HOME funds from HUD for the Project. FULL TIME Borrower will have a minimum of 1 full-time employee who STAFF REQUIREMENT works solely for Borrower. ELIGIBLE COSTS Eligible costs to be paid for by these funds will be stipulated in the Contract and are defined under 24 CFR 92.206. COLLATERAL AUDITS HAP OTHER REQUIREMENTS Upon execution of Contract, the City will place a valid first lien Deed of Trust on the Site. This lien will be released when the house is purchased from Borrower by a HOME eligible homebuyer for use as his or her primary residence Borrower will maintain records according to the recordkeeping requirements outlined above. Upon receipt of reasonable written notice by the City and as often as City may deem necessary, Borrower will make available to the City all of its records and will permit City to conduct audits of all contracts, invoices, materials, payrolls records of personnel, conditions of employment and all other data relating to the stated Project. Borrower must require each homebuyer to utilize a minimum of $1,000.00 from the City's Homebuyer Assistance Program (` HAP") for down payment assistance to ensure that the house remains affordable for 5 years from the date the project status is changed to complete in HUD's IDIS reporting system ("Affordability Period"). Failure to require down -payment assistance will result in required repayment by CHDO of the total of HOME funds awarded. If HOME funds are to be used for property acquisition or demolition then construction must begin within 12 months of purchase date or the date on which structures are demolished. ii. Construction work on the Proj ect must begin within 6 months of the date of Contract execution or the Contract will terminate. iii. Borrower will be liable for and will promptly pay all fees Borrower incurs, including expenses and charges incurred in connection with the negotiation and preparation of the documents governing or securing the Loan, and other expenses incurred in connection with the Project constructed with the Loan, including appraisal and Texas Commission on Environmental Quality (TCEQ) INSURANCE REQUIREMENTS environmental fees, whether or not the Loan closes. iii. Documentation must be acceptable in all respects to the City and its counsel. iv. All permits and approvals must be in place prior to funding of the Loan. v. All construction contracts, plans surveys, etc. must be approved by the City and assigned as additional collateral. Approval is subject to a pre -construction review of plans, specifications and cost estimates. vi. Borrower must agree to any reasonable teams and conditions that are necessary to ensure City and Borrower remain in compliance with all applicable federal, state and City laws, regulations and ordinances regarding the Project. vii. Borrower agrees to ensure that all HOME -assisted housing or housing identified as match for the HOME program meet all affordability requirements identified in 24 CFR 92.254. Borrower must maintain and present to the City on a semi-annual basis, a General Liability Insurance in the amount of $500,000 each occurrence $1,000,000 aggregate limit. Borrower is to maintain and present to the City on a semi-annual basis, a Business Automobile Liability Insurance as follows $1,000,000 each accident on combined single -limit basis, or $250,000 Property Damage $500,000 Bodily Injury per person per occurrence $2,000 000 Aggregate Borrower and Borrower s general contractor ( `Contractor") to maintain, and present to the City on a semiannual basis, Workers' Compensation insurance as follows: Statutory Limits Employers Liability $100,000 each accident/occurrence $100,000 disease/per employee $500,000 disease policy limit Contractor is to maintain and present to the City Builders Risk insurance. The Builder's Risk insurance must be acceptable to the City, and must be a valid policy at all times during the Loan. Contractor is to maintain property and flood insurance (if required), in form and amount satisfactory to the City for the Project during the life of the Loan. If applicable, insurance must be evidenced by a valid binder/policy. Certificates of insurance COMPLIANCE WITH FEDERAL STATE AND LOCAL LAWS are not acceptable. The City will be named as Mortgagee and as Additional Insured Party. The policy will also provide for 30-day prior notification to the City of cancellation Borrower agrees that as a certified Community Housing Development Organization they will comply with 24 CFR 92.300 and 92.301. If it is determined that the use of the funding provided by the City for the stated Project does not meet HOME requirements Borrower will reimburse the City for the Project costs determined to be ineligible and/or disallowed under the HOME regulations Borrower agrees that the Project will meet the property standards requirements in 24 CFR 92.251 and lead -based paint standards in 24 CFR 92.355, as well as City building standards. Borrower must comply with displacement and relocation requirements at 24 CFR 92.504 and 92.353. Borrower certifies that it is not currently listed on the General Services Administration's List of Parties Excluded from Federal Procurement or Non -procurement Programs in accordance with Executive Orders 12549 and 12689 and will not enter into agreements to expend Federal Funds with contractors that are currently listed. Borrower must comply with all prescribed procedures regarding nondiscrimination and equal opportunity, affirmative marketing, displacement and relocation, labor relations, lead -based paint and conflict of interest provisions described in 24 CFR 92 subpart H 24 CFR 92.504, Chapter 17, Article III Division 3 - Employment Practices of the City Code, and Chapter 17, Article III, Division 4 — Fair Housing of the City Code. Borrower must comply with all applicable Federal laws, laws of the State of Texas and ordinances of the City of Fort Worth Organizations that are directly funded under the HOME program may not engage in inherently religious activities as defined under 24 CFR 92.257 Borrower must agree to any reasonable terms and conditions as necessary in order to ensure City and Borrower remain in compliance with all federal regulations, state laws, and local ordinances regarding the Project. Any funds disbursed against this Conditional Commitment will be subject to the City's receipt of satisfactory documentation of the Loan and due diligence satisfaction This Conditional Commitment is confidential and is intended solely for the use of Tarrant County Housing Partnership. No other person or parties has any rights whatsoever with respect to the above teinis and conditions. These terms can be modified or other terms negotiated between the parties upon mutual agreement. To cause this Conditional Commitment to remain in effect, the Contracts between the City and Borrower must be executed on or before December 31, 2012. Any extension of such date must be in writing and signed by the City. In order for this Conditional Commitment to become effective, an original must be executed by Borrower and any Guarantors and returned to the City on or before June 13, 2012. Any extension of such time for acceptance must be in writing and signed by a City representative. We hope the foregoing is responsive to your needs and that you will accept this offer. Please indicate your acceptance with your signature below and by returning a signed copy to: City of Fort Worth Housing and Economic Development Department 1000 Throckmorton Fort Worth, TX 76102 Attn: Charletra, Development Project Coordinator Sincerely, Fernando Costa Assistant City Manager Approved as to form and legality: Ua'ln Guzman Assistant City Attorney p� Q�oaoop�j►�� The undersigned hereby accepts the foregoing Conditional Commitment and the terms and requirements herein set for and agrees to be bound thereby. BORROWER Tarrant County Housing Partnership, Inc. Signed: nna an Ness President Date: (Ph LPh OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX